December 3, 2013

Joint Foreign Chambers Statement on National Apprenticeship Program Reform

The Joint Foreign Chambers wrote to House of Representatives Labor Committee Chairman Karlo Alexei Nograles on November 18, 2013 in support of House Bills 1594 and 2227, reforming the National Apprenticeship Program. These bills deserve urgent consideration by the Congress in view of the extremely high unemployment rates among young Filipinos. Regrettably, the level of investment - both foreign and domestic - has for too long been insufficient to create enough decent jobs to meet the growing supply of young workers in the country. If this growing crisis for the young people of the country continues without the government providing solutions, their future would be bleak forcing many to seek work abroad, others to be idle and dependent and perhaps increasingly engaged in criminality and even rebellion with insurgent groups. The Technical Education and Skills Development Authority for almost two decades has administered an apprenticeship program that could be the basis for one part of the solution to the challenge of increasing employment for Filipino youth. The current program allows apprentices to be trained by a private firm for up to six months and to receive a fee of 75% of the applicable minimum wage. Approximately 25,000 apprentices have participated in this program. Such a small number indicates the importance of reforming the program so that it can provide a means of better long-term jobs for much larger numbers of young Filipinos - perhaps in the millions. One important reform would be to allow the period of training of the apprentice to be much longer than in the current law. A revitalized and reformed apprenticeship program can provide sufficient time for young workers to gain knowledge and skills while providing the companies where they work sufficient time to give them the right training and to assess their individual working skills. At the end of the apprenticeship period, many of the apprentices may be offered employment directly in the factory or office where they have been trained. Alternatively, if not so employed, they nevertheless benefit from the training and have knowledge and skills that have increased their chances to work in another company or even to begin an entrepreneurial career. As a national policy companies should be encouraged to train more apprentices than needed for the workforce. Twice the training cost for those apprentices that will not be offered employment after the apprenticeship period is completed and will be released as trained professionals into the labor market, can be deducted from taxable income.

The Arangkada Philippines Project (TAPP)

www.arangkadaphilippines.com

Funds must be made available for internal branding during the implementation of this law. The internal branding has to be directed to: a. Parents/relatives or friends financing the education of the youth, explaining that many jobs do not require college degrees; a successful apprenticeship program followed by work experience can easily be complemented by targeted studies later, often with financial support by the employer; b. Companies advertising job openings should explain that not all jobs advertised need a college degree as a minimum requirement; companies need to understand that a successful high school graduate completing an apprenticeship is going to be a better-skilled and more loyal employee than a college graduate that still needs to be trained and will continuously look for alternative employment, believing that he/she should have hired for a higher position. Section 11 of the two bills contains a requirement for the Apprenticeship Contract to include training allowances prescribed by industry subsectors through tri-partite consultations which in no case shall start below seventy-five percent (75%) of the applicable minimum wage. The JFC suggested that this requirement be modified with the phrase Provided, however, that, contributions to the apprentice by national and/or local government shall be considered in computing the 75%.

The Arangkada Philippines Project (TAPP)

www.arangkadaphilippines.com