Antiquated laws drag down RP trade, says DTI

MANILA, Philippines—The Department of Trade and Industry is pushing for the amendment of the Labor Code, which contains provisions that it said are making the country increasingly uncompetitive in the global arena.

During Thursday’s Philippine Business Conference and Expo, Trade Secretary Gregory Domingo said the country’s labor laws needed to be “relaxed” to drive investments.

“The stricter the law, the less competitive we are. We have to relax a bit some of our labor laws to be more competitive,” Domingo said. “The more restrictive you are, the less investments you’ll get. We have to strike a balance.”

With the current Labor Code, those currently employed are able to take advantage of relatively good benefits, he said, adding that many others are, however, being rendered unemployed due to the many restrictions of the law.

A provision of the law that needs to be reviewed touches on security of tenure, Domingo said. He said this provision might be a tough one to handle, given the political repercussions it may bring about.

“I would have to check with other countries’ laws, but I think we are one of the few countries with a security of tenure provision,” he said. “We recognize that laborers need protection. It’s a question of up to what degree.”

Domingo said a review of labor laws in other parts of the world would have to be done to give the government an idea of which provisions would have to be amended or scrapped.

Earlier in the year, before the Aquino administration assumed leadership, the Employers Confederation of the Philippines (Ecop) drafted a resolution calling for the amendment of some provisions of the Labor Code, to keep the law in step with globalization and the changing labor landscape in the country.

The group noted that since the Labor Code’s inception in 1974, the world of business and trade had already evolved, making the law antiquated and unresponsive to some of the changes in the global landscape.

“The archaic and counter-productive provisions of the Labor Code continue to hamper growth and economic development of the country, hinder the promotion of new investments and employment opportunities, and limit or restrict the avenues by which business can exercise management prerogative; the Labor Code, thus, needs to be revised,” the group said.

One of the provisions the group wants stricken out is Article 130, which prohibits women from doing work at night. Ecop also wants to change the provisions on contracting and subcontracting because these do not promote “dynamic and flexible work arrangements” necessary to boost business efficiency and productivity. -Abigail L. Ho, Philippine Daily Inquirer