Friday, July 11, 2008 Violations mar image of entire contracting industry - lawyer
A TORONTO-BASED electronics manufacturing services provider attributes part of its success on its wise choice of job contractor.
Celestica Philippines Inc. has outsourced its janitorial work and security force to job contractors.
But Celestica senior manager Jeoffrey Escala said companies must consider only legitimate businesses for job contracts.
When a company (principal company) resorts to subcontracting, it farms out the performance of a part of its business to another (the subcontractor). To perform the outsourced task of the principal company, the subcontractor hires its own employees.
Escala said that a contractor is legitimate if it is registered with the Securities and Exchange Commission, Department of Trade and Industry, and the Department of Labor and Employment (Dole). It must also have a business permit, among others.
But even if these requirements are complied with, lawyer Michelle Mendez-Palmares lamented that many contractors are guilty of violating the law. These violations, she added, provides the job contracting industry a bad image.
“It’s a competitive industry. However, there are contractors who (in their desire to secure a contract) sacrifice the contract rate. How could they survive with low rates amid rising prices of fuel and basic commodities? They get it from their employees and earn a lot. In the end, everybody becomes a victim,” she said.
Court order
Palmares, also president and general manager of Centurion Security Agency Inc., disclosed that some contractors are not afraid of notices from quasi-judicial agencies, like Dole, in cases when they fail to pay their employees.
A court order, she said, is what will compel them to fulfill obligations stipulated in the contract.
Escala, also president of the Mactan Export Processing Zone Human Resource Association, admitted that his company does not focus so much on the contract price, but gives more weight to the contractor’s track record of complying with the law.
“(We understand) that we are jointly liable for the contractual employees.
So our company inspects contractors and regularly check if they comply with legal requirements,” he said.
Escala and Palmares were speakers in the First Industry Forum on Job Contracting held at Parklane International Hotel yesterday. The event was organized by the Cebu Chamber of Commerce and Industry Inc., Philippine Economic Zone Authority and Berkeley Systems Management Inc.
Escala urged companies to treat contractual employees like their regular personnel, even when their wages and benefits differ, and to foster healthy working conditions for them.
“If you can give more, the better. In the case of Celestica, we give more,” he said.
Palmares admitted there are movements by contractual security guards to form themselves into a union, as they have the right to self-organization, but putting them together is difficult because of differences in wages.
“They also realized that there is no need to do so as they are given what is mandated by the law. Employers are also becoming wiser as they would ask contractors to provide them copies of remittances to SSS and other documents to prove that they are paying their employees,” she said. (NRC)
