11/6/2018 The missing workers' rights | BusinessMirror

The missing workers’ rights   

By Rene E. Ofreneo - July 25, 2018

Ending the “endo” issue cropped up in the President’s third State of

the Nation Address (Sona). Before he assumed office, the President
promised the trade union movement that he would slay the monster
called “contractualization”. The trade unions complain that the
President has failed to fulfil his promise.

However, in his Sona, President Duterte announced what the

Administration has accomplished in this area: the regularization of more than 300,000 workers as a
result of the Department of Labor and Employment’s (Dole) intensified campaign against “labor-only
contracting” (LOC). At the same time, the President acknowledged that giving workers the needed
protection against “contractualization” is a difficult one. A law on job security is needed. And so, he is
now asking Congress to pass a security of tenure (SOT) law.

However, it is doubtful if Congress shall be able to pass an SOT law that pleases all the representatives
of the three sectors of the tripartite system – trade unions, employers and government. The tripartite
debates on “prohibited” LOC and the “permitted” job contracting are as old as the Labor Code, which
was promulgated in 1974 or 44 years ago. The reported House consensus on SOT rules revolves
around the tighter rules on what constitutes LOC. Specifically, LOC entities are third-party agencies
who pretend they are the employers even if they do not possess the capital and equipment to do
business and they do not have control over the work process or the means and methods as to how
work shall be conducted.

The truth is that “contractualization” is a complex phenomenon in the labor market, compounded by
the reality that most businesses want cheaper labor to be able to compete in a globalized and
deregulated economy. In the contractualization process, most workers recruited by employers and
third-party agencies end up as temporaries, probationaries, “project employees”, “trainees” and so on.
The idea, to borrow from the language of labor economists, is to “flexibilize” the hiring arrangement in
a way that it becomes easy for employers “to hire and fire” workers without incurring expensive legal
obligations or earning the ire of militant unions.

Under globalization, the “flexibilized” workers in the organized or formal sector of the economy have
become the overwhelming majority in the sector’s work force. A “diagnostics” study by the ILO
Manila Office (2017) shows that “trade union and collective bargaining outcomes have been poor”.  In
July 2016, there were 17,245 registered unions in the private sector. Only 1,126 of these unions have
collective bargaining agreements (CBAs), which covered then a total of 200,476 workers. This CBA
coverage is less than half of one percent of the total employed (41.7 million)! Moreover, the study
shows that the CBA rates have been going down from 2003 onward.
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The above statistics partly explains why the trade unions are vociferously against any and all forms of
contractualization, which is collectively dubbed as the “endo” problem.  Under the existing practice of
unionism and collective bargaining, employers insist that only the “regular” or permanent employees
can exercise these rights. The “non-regular” or “endo” workers are excluded. Thus, every collective
bargaining process usually starts with a definition of who should be included and excluded in the scope
of the CBA. There are even prolonged legal skirmishes on who should be considered an “employee”,
as interpreted or defined by the country’s labor jurisprudence. Countless cases handled by the court
system recognize only the right of regular or permanent employees to join a union for collective
bargaining purposes.

And yet, the Constitution is explicit on the universality of the rights to union formation and collective
bargaining. Section 3, Article XIII, provides for the following:

“The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full
employment and equality of employment opportunities for all.

 “It shall guarantee the rights of all workers to self-organization, collective bargaining and negotiations, and peaceful
concerted activities, including the right to strike in accordance with law.  They shall be entitled to security of tenure,
humane conditions of work, and a living wage…”

Clearly, having an SOT law for those doing “regular” work in the formal sector of the economy is an
extremely limited way of addressing the “contractualization” phenomenon. An enabling law to help the
non-regulars enjoy the same rights is in order. As pointed out in previous articles, the universal rights
to join union and bargain collectively are rights being enjoyed by the “dispatched” and “part-time”
workers in Japan and other countries.

And one should not forget the rights of the most numerous in the labor force – the informal workers
such as the home-based workers, vendors, farmers, fisherfolk, indigenous tribal people, landless rural
poor and so on. In India, one of the biggest and internationally recognized unions is the Self-
Employed Women Association (SEWA), whose members are able to promote their collective welfare
such as setting up their own women’s bank and negotiating with the State governments on their
entitlements as citizens for certain services such as education and housing.

Some Philippine civil society and people’s organizations are trying to emulate what SEWA has
successfully done in some states of India. But from time to time, these POs and CSOs are confronted
with problems about their “legal personalities” and certain national and local rules that restrict or
adversely affect their livelihoods and self-help welfare initiatives.  There are no formal laws recognizing
the basic rights of informal sector workers to form unions or organizations and advance their collective
interests in a manner similar to what SEWA and the trade unions have been doing.

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This is the reason why an alliance of informal sector organizations has been pushing for a “Magna
Carta for Workers in the Informal Economy” (MCWIE) legislation. Progressive members of Congress
have been filing the MCWIE bill since the 13th Congress. A reform-minded Duterte Administration,
seeking to reinforce its image as pro-people, should certify this bill as urgent, alongside the SOT bill for
those in the formal sector.

One must also hasten to add: the 44-year-old Labor Code needs a legislative overhaul.  Paging the new
Speaker of the House and the new Senate President!

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Rene E. Ofreneo

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