Business leaders ask Duterte to veto ‘end endo’ bill

July 17, 2019 at 09:45

Business leaders ask Duterte to veto ‘end endo’ bill

Melissa Luz Lopez | CNN Philippines | July 16, 2019

Metro Manila (CNN Philippines, July 16) — Private companies have appealed to Malacañang not to sign the proposed law that will outrightly ban labor contracting.

In a statement, 13 members of the Joint Foreign Chambers and Philippine Business Groups asked President Rodrigo Duterte to veto Senate Bill 1826, better known as the Security of Tenure (SOT) bill.

The measure requires businesses to directly hire employees and effectively prohibits the practice of outsourcing workers through manpower agencies. This effectively creates an employer-employee relationship, where the company would either have to absorb or regularize workers.

It also states that all employees, except those on probationary status, will be treated like regular, including project and seasonal employees, entitling them to benefits received by regular workers. The services of any laborer cannot be terminated without just and unauthorized cause.

The bill was sent to Malacañang on June 27, according to Senate records. This kicked off a 30-day window for the President to act on the measure — either to sign it, reject it, or let it lapse into law.

READ: DOLE reveals Top 20 companies found or suspected to be engaged in labor-only contracting


For the business chambers, existing rules are already strict enough in terms of labor policies.

“First, the SOT bill is redundant as there are previously approved laws that already protect workers from endo, it impinges on management prerogative anchored on the Constitution,” the business groups said in a statement on Tuesday. For them, the decision to hire regular or temporary workers is solely their call.

“The regularization of the remaining workers can be achieved through the continuous implementation of both laws,” they added.

The letter was signed by the American Chamber of Commerce of the Philippines, Australian-New Zealand Chamber of Commerce, Canadian Chamber of Commerce of the Philippines, European Chamber of Commerce of the Philippines, Foundation for Economic Freedom, IT and Business Process Association of the Philippines, Japanese Chamber of Commerce and Industry of the Philippines, Inc., Korean Chamber of Commerce Philippines, Makati Business Club, Management Association of the Philippines, Philippine Association of Multinational Companies Regional Headquarters, Inc., the Philippine Chamber of Commerce and Industry, and the Semiconductor & Electronics Industries in the Philippines Inc.

Their claim stems from Duterte’s Executive Order 51 issued in May 2018 and a department order issued by Labor Secretary Silvestre Bello III two years ago, which they said “already expressly prohibit the practice of labor-only contracting.”

Ending the practice of labor contracting was among the campaign promises of President Rodrigo Duterte, who has been in power since 2016.

READ: Ending ‘endo’: How’s Duterte’s campaign promise?

Walk the talk

The private sector leaders added that the bill unduly targets them, and stays mum about the national government who also have its fair share of contractual, coterminous, and job-order workers — over 700,000 personnel, according to estimates.

“Equal opportunity is not given to private employers as it isolates them by increasing the cost of doing business that could hinder their operations and slow down growth,” they stressed.

The business chambers also warned that the proposed measure could dampen overall economic activity, saying that some firms may opt to remove low-skilled work altogether, to be replaced by automation and advanced technology. Worse, companies may choose to relocate to “more investor-friendly” locations abroad.

Bello said on July 4 that the bill may be signed by the President “anytime soon,” dubbing it as a landmark legislation for the administration. The Labor chief has recommended the enactment of the measure.

Duterte has certified the SOT bill as urgent in September 2018, allowing lawmakers to fast-track its passage.


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