Contractualization is Illegal – Herrera

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Former senator and Trade Union Congress of the Philippines president Ernesto Herrera on Wednesday said contractualization is illegal, dismissing misunderstanding that the law he authored—Republic Act 6715—allowed labor-only contracting.

“Actually, former senator Herrera’s law declared illegal contractualization,” said OFW Family Party List Rep. Roy Seneres, who joined labor union officials in a news conference on Wednesday at Manila Yacht Club on Roxas Boulevard in Manila.

Herrera said his law was totally misunderstood since it actually was the martial-law era Article 106, Presidential Decree 422, that was used by the Department of Labor and Employment to justify job contracting.

Job contracting is widely used in retail sales jobs by mall owners. Sales and other personnel are hired by a sub-contracting firm, which is contracted by the mall owners, companies or distributors to provide them with manpower. An employee is made to sign a contract every five months. Labor law says an employee who has worked for six months shall be automatically made a regular employee. A contractual employee is deprived of several benefits such as insurance and maternity benefits.


Seneres said he has co-authored a bill in the House of Representatives that will no longer allow labor contracting.

Meanwhile, TUCP vice president and former Labor Secretary Ruben Torres, also president of the BPO Workers’ Association of the Philippines, said health and safety are the major concerns of the more than 1 million call center agents in the country.

He cited BPO workers having to adjust to time zones on the job has resulted in coronary ailments, diabetes and alcoholism, among others.

Torres said the Labor department has to attend to concerns of call center agents about formation of labor unions among their ranks.

Lee watch
Herrera also declared that TUCP is keeping a close watch on the syndicated estafa charges filed against property developer Delfin Lee and other Globe Asiatique Realty Holdings Corp. officers for defrauding the Home Development Mutual Fund (Pag-IBIG) of P6.6 billion using ghost borrowers and phony documents.

“We want the strongest [legal]prosecution possible to assure a conviction, because the Pag-IBIG funds that were embezzled represent the hard-earned contributions of workers,” he said.

Pag-IBIG collects some P2.7 billion in monthly contributions from 13.5 million workers at a rate of P200 per member, including the employer’s share.

It released some P6.6 billion in loans for some 9,000 homes supposedly built by Globe Asiatique.

It later turned out that Globe Asiatique had sold many of the homes to more than one buyer using bogus papers, and that a large number of units were never completed, or remain unoccupied.

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