Business leaders support stopping ‘endo’, but not legal contracting

LOCAL and foreign business organizations in the Philippines have vowed to support the administration’s fight against “endo” or end of contract abuses, but they maintained that contractualization in itself is “good” and a legitimate practice.

As the Senate hearings on endo started yesterday, Philippine Retailers Association (PRA) president lawyer Paul A. Santos said the retail sector is supportive of President Rodrigo Duterte’s stand on labor, but believes that the government should also respect the rights of the employers.

“What the President is simply saying is for employers in retail, manufacturing, services, etc. to respect the rights of the all employees, regardless of their employment status,” Santos said, and that these employees should receive mandatory benefits including social security, maternity leave and other forms of leave, and 13th month pay whether they are regular, probationary or term employees.

Endo, Santos said, is the abuse of contractualization. Employees, in this case, are terminated every five months and then rehired for the same duration, depriving them of mandatory benefits.

On Wednesday, Sen. Joel Villanueva, the Senate committee on labor, employment, and human resources chair, said they will study the proposed measures filed by some of the senators, including Sen. Juan Miguel Zubiri who filed a resolution directing the panel to conduct an inquiry into the practice of contractualization and sub-contractualization.

“The abuse, I am against it. We have evidence of 555 (endo),” said European Chamber of Commerce of the Philippines (ECCP) vice president Henry Schumacher in a separate interview.

“However, we also have come to realize that as technology moves very fast, we need specialists who, at a certain time, will fix things and then be released later,” added Schumacher, referring to project-basis workers or consultants.

Cebu Chamber of Commerce and Industry (CCCI) president Melanie Ng also previously noted that flexibility or job-switching is becoming the trend where having a long tenure is now “less of a benefit,” as technology has given workers more options and opportunities.

They reiterated that contractualization in itself is legal.

“What a lot of our members (in the retail business) have expressed concern about is that under the labor code, employers also have certain rights. Retailers urge the government to respect their rights as employers under the law. It goes both ways,” Santos said.

Under Labor Code Articles 106 to 109, the government allows contracting and sub-contracting agreements.

The Department of Labor and Employment, for its part, has also issued Department Order 18-A, identifying the illegal forms of contractualization, yet did not ban it altogether.

Under the Duterte administration, Labor Secretary Silvestre H. Bello III said Dole will review the department order, and warned that by 2017, endo and other illegitimate forms of contracting must be eliminated.

Erring establishments found to have practiced endo, according to Dole, will be closed down, as stated in directives sent to Dole regional offices.

Workers hired under the endo system may also file cases against their employers before the National Labor Relations Commission (NLRC).


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