In January, the House Committee on Labor headed by Representative Randolph Ting proudly announced a breakthrough in the “security of tenure” (SOT) legislative issue. House Bill 6908, which was essentially based on the bill filed by Rep. Raymond Mendoza, was overwhelmingly approved by the House plenary 199-7. The House is now awaiting for the approval of a similar bill from the Senate.
If both chambers are able to forge unity on the SOT issue, the widespread practice of labor-only contracting (LOC), a system where manpower agencies pretend that they are the workers’ employers when they are not, is likely to be reduced. HB 6908 reinforces the Department of Labor and Employment’s (DOLE) campaign against scalawag agencies. Last year, Labor Secretary Silvestre Bello issued Department Order 174, which tightens the qualification rules for job contractors and pushes for stricter inspection of company practices in labor contracting arrangements.
HB 6908 makes it easier for a complainant to establish the existence of prohibited LOC. In particular, the following reason is deemed sufficient: proof that the agency has no substantial capital or proof that the agency had no control over the work process or proof that the work outsourced is directly related to the business of the employer. Under the existing provisions of the Labor Code, all these three conditions must be present, all-in conditionalities which naturally favor lawyers of non-compliant agencies and employers. Two more reform measures are added: strict qualification standards (seven in all) in the licensing of agencies and non-termination of agency workers without “just cause” and due process.
Still, some trade unions are not satisfied with the above House Bill. They seek an outright declaration by the legislature and the executive branches that any form of outsourcing, job contracting and other forms of flexible hiring arrangements, collectively dubbed as “contractualization” or “casualization”, is unlawful and should be banned outright. This is the essence of their angry complaint against President Rodrigo Duterte, who promised to end the “endo” system within months of his presidency and who promised to issue an EO ending contractualization this year.
At any rate, it is clear that the trade unions, militant and vocal as they are on the rights of wage workers, have succeeded in making the “endo” issue a national policy issue. They have forced DOLE to issue DO 174, which is far more restrictive than the DOs on the prohibited LOC and permitted job contracting issued by previous Administrations (DO 10 under Ramos, DO 18-2 under Macapagal-Arroyo, and DO 18-A under Aquino II). If HB 6908 becomes a law, this should be credited to their militant and sustained campaign to put more teeth in the government’s crackdown on the widespread abuse of job contracting arrangements.
But the big question: where are the rights for the most numerous, the workers in the huge catch basin of the labor market: the workers in the informal sector (IS) or informal economy (IE). They account for more than half of the employed and yet they are not covered by the Labor Code of the Philippines, which has no book or chapter dealing with the informals.
The Constitution is quite explicit that all workers, without exception, are entitled to social and labor protection. Section 3, Article XIII, of the charter states:
“Section 3. The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all.
“It shall guarantee the rights of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted activities, including the right to strike in accordance with the law. They shall be entitled to security of tenure, humane conditions of work, and a living wage. They shall also participate in policy and decision-making processes affecting their rights and benefits as may be provided by law.”
And yet, to date, there is no established system of recognizing and registering IS/IE workers’ organizations, there is no established system acknowledging the rights of IS/IE workers to engage in concerted activities and bargain collectively to press for their collective interests, and there is no established system of consultation on policies and programs that affect them. It appears that to past legislators and policy makers, “labor” simply means wage workers in the formal labor market. This is obviously the reason why “labor laws” are generally focused on the existence of “employer-employee relations” in organized establishments and on the rules governing trade union formation and collective bargaining. The IS/IE workers have become invisible based on this framework. Hence, the IS/IE workers are not covered by the Labor Code of the Philippines, which should be aptly re-titled Formal Sector Labor Code.
Ironically, despite decades of unionism and collective bargaining, certain labor rights are enjoyed only by a minority in the formal sector. According to the ILO Manila 2017 “diagnostics on decent work”, there were 1,126 unions with collective bargaining agreements (CBAs) that covered a total 200,476 workers. Que lastima! This CBA coverage is less than half of one percent of the total employed of 40 million in 2017.
Clearly, there is so much to be done in the formal sector in terms of organizing and recognizing workers rights. But one should not lose sight of the bigger labor market picture: the rights of the poorest and most numerous are missing and unrecognized.
This is why the hearings conducted by Senate Labor Chairman Joel Villanueva are timely and important. Senate Bill 1135 filed by Senator Grace Poe, reinforced by those filed by Senators Sonny Angara and JV Ejercito, seek the establishment of a system of registering organized IS/IE workers and enterprises, a system of consultation with these workers and enterprises through the Informal Economy Development Council (national level) and Workers in Informal Employment Local Development Councils (LGU level), and a system of crafting development plans for the IS/IE in consultation with the IS/IE workers. In addition, the basic rights of the IS/IE workers, including their rights to livelihood and security at work are recognized in the proposed legislation.
The bill of Senator Poe is entitled “An Act Providing for a Magna Carta of Workers, Enterprises and Organizations in the Informal Economy”.
The above Magna Carta initiative of Senator Poe and company is not new. Through the efforts of a broad coalition of IS/IE workers organizations called MAGCAISA, similar bills had been filed in the 13th, 14th, 15th and 16th Congresses. No progress. Is it not time that such an urgent bill seeking protection for the country’s most numerous be passed?
In a consultation meeting with House Labor Chairman Randolph Ting by the MAGCAISA officers, the former expressed concern over the possibility that the Magna Carta shall allow informal and ambulant vendors to occupy the streets freely, thus, subverting existing jurisprudence that these streets are “beyond the commerce of man”. The reality, however, is that the Magna Carta does not promote street invasion by the informal vendors. What the Magna Carta seeks precisely is a system of policy consultation and coordination through the proposed national and local development councils for the IS/IE workers. With such a system of consultation and coordination, there will be stronger government-IS/IE worker partnership in various societal concerns such as cleanliness, health and safety, traffic discipline, etc., as well as partnership in building a more inclusive and sustainable Philippines.