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[OPINION] Harassed

DEMAND AND SUPPLY – Boo Chanco – The Philippine Star
June 1, 2022 | 12:00am


The IT-BPM industry can’t wait for the new administration to take over. They are hoping they will get a better hearing and appreciation of the industry’s work arrangement problems with the new government.

The past few months had been a nightmare for many of the industry members. They feel harassed as teams of BIR and Customs agents swoop down on their offices to enforce the DOF’s order to bring back to the office 100 percent of their workforce.

Customs people have assessed them back duties for equipment imported under the prevailing perks that are not in their premises. The BIR is disallowing any tax incentive if their workforce are not in the office by the end of March.

It doesn’t matter that PEZA, the agency regulating them, has allowed them a phased period of returning work back to the office. The industry is asking until the end of September to bring all their staff back.

Other than the physical problem of dismantling computers and other equipment from the homes of their workers and setting them up again in the office, the BPOs are also worried they will lose some of their best staff who prefer to work at home.

It’s obvious the DOF officials just want them to give up their perks so more taxes can be collected. But industry leaders told me most of their members still need their perks to remain profitable. I am told they will shift some clients to their branches abroad if it’s more profitable there.

The law being cited by DOF was actually designed for manufacturing industries. Because they enjoy duty perks on importation of equipment and raw materials, it is important to ensure these are not diverted to the local market.

But when we were trying to create the BPO industry here, our officials creatively interpreted the law to allow them to declare buildings outside the export processing zone as compliant. There really isn’t any raw materials involved. We are just talking about computers and communication equipment.

The pandemic and the lockdowns imposed by the government forced the BPOs to innovate and try work from home arrangements. It worked, to their surprise.

WFH is here to stay. The earlier we adjust our rules to accommodate this worldwide development, the better it will be for our investors and our workers. I am told by BPO industry spokesmen that allowing them to adapt to global work trends, like WFH, will help propel the growth of our BPO industry.

Actually, all that the industry is asking for now is a phased approach to help them transition, with minimal disruptions to operations. But DOF won’t hear of it.

The DOF is eager to show they are quickly reopening the economy. They think that with BPO workers back in the office, malls won’t look like columbariums and restaurants may start to recover as well.

But DOF shouldn’t be this stubborn. IT-BPM industry leaders told me they stand to lose their competitiveness without hybrid. That will have a negative impact on job creation and export revenue generation.

“In the absence of a stable hybrid work model policy, we stand to miss out on the opportunity to capture a bigger slice of the $ 500 billion addressable global services market,” one spokesman told me.

Globally, 70 percent of IT-BPM organizations are likely to operate in hybrid mode in the future. Hybrid work is increasingly integrated in the business solutions offered by service providers.

Global and local studies show higher productivity and engagement in a hybrid setting. One study reveals that productivity improved by as much as 47 percent because of the savings in commuting time and the improvement in work-life balance.

This is a particular concern in NCR due to our dysfunctional public transport system. Massive traffic jams are forcing their workers to spend at least four hours a day stuck in traffic. And with higher fuel costs, commuting from home to office has also become more expensive.

Some workers say they cannot afford the cost of going back to the office. Transport costs from fares to gasoline have gone up since the pandemic started. Food costs in restaurants have also increased since.

The gradual return of BPO employees to the offices will give transport officials time to get their act together on public transport availability. It will also ease traffic jams. This will help reduce fuel consumption and allow workers to spend more money on food and other necessities.

The most productive employees who plan to resign can easily get job assignments in the gig economy without having to leave home. They will end up in the underground economy because they will get paid through tech payments platforms that the BIR has no way of monitoring.

The one other big advantage of WFH is that staff can work outside of Metro Manila where cost of living is lower, even if their BPO company is based in NCR. This creates new income streams that will support the growth of provincial economies.

Global IT-BPM clients have embraced the hybrid work models in their operations and have made it a requirement for engaging with their partners in the Philippines. The Philippine IT-BPM industry is likely to lose business to other competing locations if we fail to adapt to the new ways of working.

“Our competitors in global services locations, including India have begun revisiting their remote work policies to reflect the emerging work trend. Policy makers and legislators in competing locations such as India, Poland, and Malaysia have made it a priority to institutionalize flexible work arrangements beyond COVID-19,” industry leaders told me.

Right now the foreign principals of our BPOs are in panic mode, feeling harassed by the visits of BIR and Customs agents. Because the BIR and Customs are notorious for dealing when they “raid” a company, foreign managers are particularly sensitive. They worry the optics may spark investigations in their home countries where strict anti corruption laws prevail.

Feeling harassed today may become a reason to leave and that’s bad news for the people they employ. Not difficult to be reasonable. Maybe the next set of officials will be.