The Department of Labor and Employment (DOLE) has imposed a moratorium on the processing of new applicants for contractors and subcontractors, as the Duterte administration prepares to stop contractualization.
Labor Secretary Silvestre H. Bello III issued Department Order 162 suspending all pending applications for registration of contractors or subcontractors, although existing licenses will continue to be honored by the government until revoked.
“All certificates of registration of contractors/subcontractors issued prior to this order shall be respected, unless otherwise revoked through the exercise of the enforcement and adjudicatory powers of the secretary of labor and employment or his duly authorized representative,” Bello’s order read.
However, labor groups continued to press the Duterte administration to make good on its promise to stop contractualization by repealing Department Order 18-A, which they perceive as a loophole used by employers to defeat the constitutional right of workers to security of tenure.
Under Department Order 18-A, a contractor or subcontractor is not deemed to be engaged in the illegal practice of labor-only contracting for as long as such contractor or subcontractor has at least P3 million in capital in the form of tools, machinery, equipment and real estate.
The security of tenure of workers would only be with respect to the licensed contractors or subcontractors which engaged them, and not with respect to the corporations where they are actually rendering the service.
According to militant group Anakbayan, these laws, which allow the operations of contractors and subcontractors, should be repealed, otherwise, the pronouncements against the illegal practice of “endo” or end-of-contract fixed-term arrangements with workers will be a mere “empty show.”
“We challenge the President to take decisive steps against contractualization at the policy level by passing a law that criminalizes the employment scheme and junking policies like the Herrera law, DOLE Order 18-A Series of 2011, and Executive Order 366, which allows contractualization,” Anakbayan Chairman Vencer Crisostomo said in a statement.
“Contractualization leaves the workers’ families with almost nothing, places employees constantly under the fear of the instability of their jobs, leads to underskilled workers who have not developed during their six-month short employment, and prevents them from forming unions to further their rights,” he added.
On Monday Mr. Duterte reiterated his policy against contractualization and warned corporations to follow labor laws and not wait for any inspection, which could result in the closure of their factories.