DO168 to worsen rather than end contractualization — KMU

Like firecrackers about to explode, this is how the KMU federation leaders depict the workers' brewing anger at the delay in banning contractualization. (Photo by M. Salamat / Bulatlat)
Like firecrackers about to explode, this is how the KMU federation leaders depict the workers’ brewing anger at the delay in banning contractualization. (Photo by M. Salamat / Bulatlat)


“We cannot accept the continued legalization of contractualization and proliferation of agencies.”

MANILA — Workers are increasingly becoming disappointed with President Duterte’s still unrealized promises. “Six months is more than enough time for the Duterte administration to have implemented some changes,” said Jerome Adonis, KMU Secretary General. But until today, contractualization, which President Duterte promised to end, is still happening all over the country and even growing in scale. And it doesn’t seem about to end given the new contractualization policy drafted by the Department of Labor and Employment (DOLE), according to various workers’ groups.

In a press conference Wednesday Jan 4 in Quezon City, leaders of national labor center Kilusang Mayo Uno condemned the newly minted draft policy on contractualization submitted last week to the president by the Labor Department.

The new policy called Department Order no. 168 (DO168) features provisions that, the KMU said, will never end but only worsen the exploitative employment setup.

They still have to get a copy of the said contractualization policy. There is none yet as of this writing on the website of DOLE. “We have written labor officials for a copy, but we still haven’t got a copy of DO 168,” said Lito Fadriquelan, president of Ilaw-Buklod ng Manggagawa, a federation allied with KMU.

The labor leaders asked the president to reject the said new contractualization policy and instead push Labor Secretary Silvestre Bello III to implement the president’s marching orders on ending contractualization.

Contractualization to worsen under DO168 – KMU

Based on media reports, the changes in the old contractualization policy included raising the required seed capital of manpower agencies from P3million to P5 million ($60,472 to $100,786); imposing a fine on agencies found violating the DO; regularizing the workers but at the same time saying their employer-employee relationship is with the agency and not with the principal; allowing contractuals to unionize and negotiate a collective bargaining agreement. It also directs agencies to provide support to workers if their contract is not renewed and they failed to find another job in three months.

But, the KMU leaders said, these are just sugar coating to the problem of continued contractualization. “All these do not reflect the workers’ unified calls to ending contractualization; at best these are just sugar coating for an even worse implementation of contractualization,” they said.

The main problem with the new contractualization policy stems from the continued legality of manpower agencies and the legalization of employers’ claims denying the employer-employee relationship between the contractual and the principal. George San Mateo, national president of transport group PISTON, said the DO168 is worse (than DO 18-A) because it not only legitimizes contractualization, it removes the employer-employee relationship between the contractual and the principal.

“If workers can be regularized and their rights to form a union can be recognized, why not just regularize them under their principal?” asked Doods Gerodias, leader of Alliance of Democratic Labor Organizations (ADLO), a federation affiliated with the KMU.

“Regarding what they’re saying about allowing contractuals to unionize and bargain, to whom will the workers go to ask for a wage hike? Will the service provider negotiate on their behalf with the principal companies?” Gerodias asked.

DO168 Bulatlat Photo
KMU leaders urge workers to let their voices be heard until the DOLE junk DO168. (

It is not the third-party manpower agencies that profit from the workers’ labor power but the principal, said Adonis. As such, workers can only truly negotiate for a wage hike with the principal and not with the agencies. Adonis explained that in fact, the agencies’ profit comes from the amount that they take out of the workers’ salaries. “They are just another layer of exploiters,” he added.

On top of being an instrument in pushing down wages, the manpower agencies facilitate the principal’s escape from its responsibility to the workers, such as ensuring their occupational health and safety, job security, benefits and retirement pay. “We cannot accept the continued legalization of contractualization and proliferation of agencies,” said Gerodias. He said these agencies are aiding principal companies in “killing off the workers’ rights to be regularized and in limiting the benefits the workers can enjoy.” In fact, he said, many labor agencies are dummies of big companies.

The new labor policy is not the answer to the workers’ demands to end contractualization once and for all, the KMU concluded.

Serving a warning to Pres. Duterte

Jerome Adonis of KMU warned that should the president approve the new contractualization policy, then it means he is in agreement with it and is not really serious at fulfilling his promises to workers. If that were the case, “He will soon face also the workers’ growing wrath and protests,” Adonis said.

He urged Labor Secretary Bello to stop trying to wash his hands off his “betrayal” of the workers’ united position against contractualization.

Adonis said it is not true that the Labor Department has its hands tied by existing laws. If the Labor Secretary can issue a policy legalizing contractualization (as what happened in DO 18-A), then he (or she) can also withdraw it, the KMU said. Doing just that is one of the KMU’s “concrete, doable proposals toward ending contractualization” that they submitted to the Labor Department as soon as Bello took office.

The labor center is now seeking a dialogue with President Duterte.

The KMU predicts that the DO168 will result in more and more workers being hired through manpower agencies under the “legalized contractual employment schemes.” These, in turn, will result in more extreme labor exploitation as the DO’s permitted removal of employer-employee relationship “gives capitalists greater freedom to siphon super profits,” Adonis warned. He urged all workers to unite and make their voices heard “until the Labor department junks its anti-worker department order.”

On January 6, various workers’ unions are set to hold what they call as “Metrowide Breaktime Protests.” Across Metro Manila, workers will gather to protest outside their workplaces during their break. On January 11, the KMU plans to form a human barricade in front of the Department of Labor and Employment (DOLE) main office in Intramuros, Manila.

They called on all Filipino workers to show their outrage against the Labor department’s “betrayal” of their demand for regular jobs. The “Workers are not stupid, they’re just hungry,” said Nenita Gonzaga, KMU Vice President. (

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