Senate bill seeks stop to labor-only contracting

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A bill that aims to stop labor contractualization that denies workers security of tenure guaranteed by the Constitution has been filed by Sen. Aquilino Pimentel 3rd.

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Pimentel, in filing Senate Bill (SB) 3030, stated that the Philippine Constitution provides that “the State affirms labor as a primary social economic force,” and that “it shall protect the rights of workers and promote their welfare.”

SB 3030 seeks to amend Presidential Decree 442 or the Labor Code of the Philippines to strengthen the prohibition against labor-only contracting.

The labor code prohibits labor-only contracting or an arrangement where a contractor or sub-contractor merely recruits, supplies or places workers to perform a job, work or service for a principal.

But, according to Pimentel, there are employers who wantonly circumvent labor laws through a system that is designed to prevent workers from attaining regular employment and security of tenure.

He said some employers manage to get away with it by terminating employment every five months and thereafter rehiring the same workers for the same duration, or by denying the existence of employer-employee relationship by engaging the services of workers either from workers’ cooperatives or manpower services.

“These prevalent practices of labor contractualization have made it difficult for workers to attain the security of tenure guaranteed by the Constitution,” Pimentel noted.

In his proposal, the senator seeks to prohibit employers from taking undue advantage of the economic situation or lack of bargaining strength of the employees or undermining their security of tenure.

He wants to make it unlawful for employers to require contractual employees from discharging functions that are currently being performed by regular employees and to strengthen the prohibition against employers who require contractual employees to sign as precondition to employment or continued employment an antedated resignation letter, a blank payroll and a waiver or labor standards, including minimum wages and social or labor benefits.

“The proposed measure will put an end to the malpractice that has victimized tens of thousands of workers nationwide,” Pimentel said.

Sen. Ferdinand Marcos Jr. earlier condemned the practice of contractualization, particularly the so-called “5-5-5” labor contract, which, according to him, is becoming an industry standard.

Under the “5-5-5” scheme, a contractual employee is hired and fired every five months by employers.

“There is one contractual worker for every three rank-and-file among the country’s entire workforce who are underpaid and barred from receiving additional financial benefits on top of their basic pay,” said Marcos, who expressed willingness to assist the Labor department if he is elected Vice President next year.

Marcos also noted that contractualization is becoming rampant but the Department of Labor and Employment (DOLE) seems to turn a blind eye to it.

“There is a need to put a tight grip on the compliance of laws governing contractual employees. This should go hand in hand with strict monitoring from DOLE,” he said.

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11 Comments

  1. Oh my gosh, what a miracle of all miracles ….. really miracles do still come true, especially before and during election years …. Hallelujah & praises to high heavens for these senators that they suddenly wakes up from their hibernated state and voila remember the case of the downtrodden laborer. Well you can see what election year can do.

  2. This is the pride of the pest government. Most politicians and government officials don’t really care about the welfare of the people except their own and their family’s royal lifestyles.

    But thank to Senator Pimentel III.

    Hopefully this law will really contain provisions that is genuinely for the benefits of the Filipino workers and not watered down to a useless law.

  3. mR. Pimentel , isa ka sa nakinabang sa 555 system ng dilawang gobyerno. Panahon ni Marcos walang ganyan na contractualization, dahil isa ako sa nabiyayaaan ng regular employment.. After EDSA 1 revolution, everything has changes. Like the contract of OCW , (OFW), during marcos time, there is no contract for OFW of more than 1 year. All categories for OFW , the contract between employer and employee is only 11 months +1 month vacation total of 1 year plus 5% increased of the basic salary of OFW.. This is the policy of POEA for those who want to take Filipino workers out of our country. Ngayon narinig mo lang na sinabi ni Bong Bong Marcos na kapag naging Vice President si BBM gagawin ni BBM lahat matanggal lang ang contractualization na ginawang batas ni Alvarez during Corykong evil woman..I will never forget what EDSA 1 revolution done to my beloved country..

  4. Damn on Labor Secretary Baldoz for her silence on this clear violation of labor law for almost six years. Can’t blame her. She’s a good follower of her principals: the Ayalas, the Aboitizes, the Sys, the Aranetas, the Roxases, at iba pa. ALL OLIGARCHS!!!

  5. Am with you this time Mr. Koko. Finally, a meaningful action for the benefit of “endo” or “555” employees. This is LONG OVERDUE!!!!

  6. Sen. Pimentel:

    You are just misguided. Security of tenure is a socialist measure. As all socialist measure, this one will dumb down the public a bit more politically and economically. Security of tenure guarrantees that incompetentents can’t be fired ti be replaced with more capable workers.

    Capable and efficient will be hard hit by this measure. Their upward mobility will be hampered, as the incompetent above them can’t be fired and potential openings somewhere are also staffed with incompetents who can’t be fired.

    This kind of measure is just an appeal to emotion. It’s heart breaking to see someone gets fired. That is the obvious. What is not obvious is the efficient and capable person who is jobless because he was not able to get the job of the incompetent because the incompetent can’t be fired. This scenario is present is government agencies. Incompetents with secured tenure sitting pretty while the casuals doin all the hard work with delayed salaries and reduced bonuses.

    What can security of tenure really do? The job is there. It will always be needing one person to do it. Get that. One person will always be doing the job. We might as well give it to the most deserving by not limiting ourself to fire incompetents.

    • You are the one who is most misguided. Who told you that regular workers cannot be fired? Where did you get that? The issue here is the ‘wholesale/collective’ denial of these workers to become regulars- qualified or not.

  7. Danilo Quilisadio on

    I commend Sen. Aquilino Pimentel 3rd for filing a bill that seeks to put an end to labor-only contrtacting. Labor-only contracting not only denies workers’ security of tenure, it also denies them the benefits of regular employment. Labor contracting only used to be an exception to the general rule. Now it seems to be the general rule. Even big companies like San Miguel Corp. and Coca Cola are already into it. How the Dept. of Labor allowed this to happen is beyond me. Imagine working for 5 months at a time only and while working as such, you are already looking for another job 5 months later. What a miserable life!

    • foreignobservor on

      Fully agree. How can an employee learn to take pride in their work if they know their position is only good for five months?
      Employees just put in time if the are on contract,doing as little as possible which means customer service is next to non existant.
      DOLE,you all should be ashamed of yourselves,you all should be fired for allowing this contractual hiring garbage.