Is government helping or hurting business?

This week, about 2,000 HR executives and managers shall convene in Waterfront Lahug for our three-day 56th Annual Convention. My topic as one of the convention speakers is an assessment of how government is helping or hurting business by its laws and regulatory interventions.

There is a difference between what people want and what they really need. Also, what the whole country demands are not necessarily good for the whole nation in the long run. Politicians are quick to cater to what’s popular, often neglecting long-range and far-reaching consequences of their acts. Senators and congressmen were very fast in submitting bills to the Senate and House, even when the opening of Congress will still be on the third Monday of this month. Most of these bills, with all due respect, were not well thought of, and are just knee-jerk reactions to popular clamor and spontaneous appeasement of the much-expectant and too-demanding crowd.

The senate president revived his old proposed legislation for the compulsory 14th month pay, and there is now an approved bill waiting for the president's signature on the New Security of Tenure Law. Of course, everyone wants to receive another month’s salary, which would require employers to pay for 14 months for only 12 twelve months of actual work. Can employers really afford this additional financial cost of doing business? Considering that more than 95% of our employers nationwide are medium-scale, small-scale and micro, that legislation may, in the long-run, kill the goose that lays the golden eggs.

Giant companies may be able to absorb the additional cost, although they have to do a lot of adjustments. But small and struggling service companies may be pushed to the brink of bankruptcy and financial ruin. Such a law may result to retrenchments and closures of small business, thus, become anti-labor in the long run.

The Security of Tenure Law is intended to abolish contractualization, and thus shall kill the business of service and job contracting, including those that are licensed and legitimate. There is even an attempt to do away with fixed-term employment, thus even universities can no longer appoint deans for a limited tenure of three or two years. Deans will stay as deans forever, even beyond their periods of excellence, when they reach their level of incompetence, and until retirement, resignation, dismissal, or death. That would be bad news for academic institutions. The law also seeks to do away with seasonal jobs, like temporary work during planting, harvesting, and milling season in the sugar industry.

It’s good the president hasn’t yet signed the New Security of Tenure bill into law. There is a need to reexamine its philosophy, need, use, and relevance. Our senators and congressmen shouldn’t be myopic and politically motivated. They should listen to NEDA, DOLE, DTI, economists and finance experts, not just labor leaders, progressive rabble rousers, and agitators. They need a balanced perspective, and a long-ranged view of the socio-economic conditions of our third-world economy.

It is high time for our politicians to listen to industry leaders and economic think tanks, so they shall come to the awakening that not all that’s popular is right. I invite you to attend our convention and give your views on the role of government in globalized economy. It will be a very heated debate and exchange of views.