Philippines President Rodrigo Duterte vetoed the Security of Tenure Bill on July 26, which seeks to regulate the practice of job contracting (labour hire) in the country.
Popularly known as endo (literally, “end of contract”) or contractualisation, job contracting is the practice of supplying workers to corporations through a third-party manpower agency. The agency assumes the role of employer, freeing companies from legal obligations to their workers. This includes denying the workers’ right to collectively bargain when they form a union.
This unjust scheme results in precarious employment, leading to short-term jobs, termination without cause and union busting. This happens when a company ends its contract with the labour-hire agency.
One of Duterte’s campaign promises in the 2016 election was to end contractualisation — a bold promise that added to his popularity among workers.
However, instead of abolishing it, the Department of Labor and Employment (DOLE) issued a departmental regulatory order (DO 174) that allows for “permissible” job contracting.
The Security of Tenure Bill, authored by majority bloc senator Joel Villanueva, reiterates the regulatory provisions of DO 174, including the licensing of labour-hire agencies, thereby codifying job contracting into law.
Socialist labour centre, Solidarity of Filipino Workers (Bukluranng Manggagawang Pilipino, BMP) opposed the bill for its expressed legalisation of third-party job contractors, which the existing Labor Code is silent on. Several other labour organisations followed suit and opposed the bill.
A salient provision of the Security of Tenure Bill, which affirms a number of existing Labor Code regulations, is the prohibition of contracting out jobs that are “directly related” to the business of the employer, whilst allowing contracting on non directly related jobs.
In vetoing the bill, Duterte said: “Businesses should be allowed to determine whether they could outsource certain activities or not, especially when job contracting will result in economy and efficiency in their operations, with no detriment to the workers, regardless of whether this is directly related to their business.
“Our goal … has always been to target the abuse while leaving businesses free to engage in those practices.”
In a recent briefing, Labor Secretary Silvestre Bello III said Duterte had instructed him to submit a “new version” of the Security of Tenure Bill that would “serve the purpose of workers and business[people]”.
In response, BMP president Luke Espiritu said: “In effect, Duterte wants zero regulation of job contracting.
“If he believes that businesses should be free and unregulated in practicing contractualisation, and if Duterte’s shameless pro-capitalist agenda will be legalised, then the Filipino workers are damned to sweatshop labour a la Bangladesh or Manchester in the 1800s.”
Espiritu added that the decades-long practice of contractualisation had resulted in precariousness, de-unionisation and growing social inequality.
“This will result in more poverty, insecurity and hunger, while Filipino capitalists become ultra-rich multi-billionaires," Espiritu said.
“Before the neoliberal era, the Philippines was a hotbed of militant unionism that benefited millions of workers. Now that we are de-unionised, workers will be more restless and Duterte’s pronouncement will result in numerous strikes after years of dormancy, as is happening right now.”
Since August 2018, BMP has organised seven strikes, all due to union busting resulting from contractualisation.