House passes bill banning labor-only contracting

(Philstar.com), 1 Dec 2020

MANILA, Philippines — With a vote of 204 in favor, seven against and three abstentions, the House of Representatives passed Tuesday a bill banning labor-only contracting in the private sector, a move which some lawmakers said would not completely ban the “abusive” practice of contractualization in the country.

House Bill No. 7036 seeks to prohibit labor-only contracting, which it defined to be existing in the following circumstances:

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The contractor does not have substantial capital or investment in the form of tools, equipment, machineries, work premises and others
The contractor has no control over the workers’ methods and means of accomplishing their work
The workers recruited and placed by the contractor are performing activities which are directly related and necessary to the principal business of the employer
Fixed-term employment is also prohibited under the proposal, except for overseas Filipino workers, workers on probation, relievers who are temporary replacements of absent regular employees whose engagements shall not exceed six months, project employees and seasonal employees.

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The bill provides that the rights and benefits of relievers, project and seasonal employees should be at par with regular employees.

Rep. France Castro (ACT Teachers party-list) said that this provision actually gives a “legal cover” for contractualization.

“Where’s the justice in the government’s legitimization of businesses’ invention of artificial seasons like ‘Valentine’s season,’ ‘back-to-school season,’ and others as an excuse not to hire regular employees?” Castro said in voting against the proposal.

Castro and her other colleagues in the leftist Makabayan bloc in the House also pointed out that the proposal, which changes the definition of a regular worker from someone who is “usually necessary or desirable” to someone who is “directly related and necessary” to a business is detrimental to contractual workers hoping to be regularized.

“The simple change in parameters actually has far-reaching consequences and dooms the hopes of millions of contractual workers for regularization,” Rep. Arlene Brosas said.

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Among President Rodrigo Duterte’s key campaign promises is to end short-term hiring, colloquially known as “endo,” short for “end of contract.”

Endo is an abusive labor practice where a worker is hired for up to five months to skirt a labor law granting permanent tenure on the sixth month of service. The practice leaves many Filipino workers unprotected and without benefits.

In the 17th Congress, the legislature passed a similar measure which sought to end the practice, but Duterte vetoed it saying that the bill effectively banned other forms of contractualization that do not particularly harm employees. — Xave Gregorio