Labor groups support NAPC in seeking Duterte’s EO vs contractualization

NAPC against contractualization
‘No to contractualization’ calls bring diverse labor groups to NAPC. (Photo by M. Salamat / Bulatlat)

“Contractualization aggravates poverty and widens the gap between the rich and the poor.”


MANILA — Labor union leaders showed their united stand against all forms of contractualization as they welcomed the initiatives of the National Anti-Poverty Commission (NAPC) to push for policies toward ending it. In a press conference in Quezon City on Thursday, April 27, they praised the NAPC and expressed their enthusiasm at working with NAPC to raise the issue of contractualization come their next en banc meetings with President Rodrigo Duterte.

The Nagkaisa Labor Coalition, Kilusang Mayo Uno and other labor organizations expressed hopes that in the next meetings with the president, who promised to end contractualization, they would be able to correct the “mistaken approach” of Labor Department Order 174.

NAPC’s Formal Labor and Migrant Workers Sectoral Council is drafting proposals for an Executive Order banning contractualization. They hoped President Duterte would sign it after meeting with labor groups and with NAPC on May 15.

Contractualization is an employment scheme under many names but with a uniform setup: workers are hired and often continue working in the same company for years, but their true employer evades admitting the direct employer-employee relationship between them by using manpower agencies or labor cooperatives and cabo, and so the workers never become regular on the job under their true employers.

The setup makes it easier for employers to hire and fire workers, bring down wages, and prohibit, crush or limit unions. No thanks to contractualization, an employed person has many alternative descriptions rather than being just an employee: he or she may be project-hired, an agency worker, a direct-hired contractual, a job-order employee, a seasonal contractual, and in the end, what they described as “permanent contractual.”

Being a contractual has come to mean being denied wage hikes and a host of benefits that any long-term employee is expected to enjoy as per the Labor Code. It also makes it harder to form unions because employers could simply refuse to renew contracts, or else drop altogether the agencies supplying them with workers.

“Contractualization aggravates poverty and widens the gap between the rich and the poor. It traps workers in the vicious cycle of insecure, underpaid and unprotected employment,” said Secretary Liza Maza, lead convenor of NAPC.

Pushing to actualize Duterte’s promise to end contractualization

In one of his campaign sorties before he became president, Duterte said about his plans on contractualization:

“I don’t care if you will get angry with me, but I am not open to a compromise. Contractualization must go. It is anti-people.”

During the first NAPC en banc meeting with the basic sectors on January 30, 2017, and during his dialogue with labor leaders on February 27, 2017, he reiterated that “Contractualization is anti-poor.” And, he said, he will not renege on his promise.

However, the Labor Department Order 174 issued by Labor Secretary Silvestre Bello III fell short of Duterte’s no-compromise ending of contractualization. No labor group approves of the DO 174. To them, the main reason it fails is the fact that it only regulates contractualization. Their experience with the government allowing one form of contractualization to happen and supposedly banning other forms has only meant virtually giving license to rampant contractualization. Even after some painstaking campaigns to expose cases of illegal contractualization, the workers ended up being declared regular only on paper.

Much like the position of labor groups, NAPC finds that any measure that regulates instead of prohibits contractual employment will not only give employers and manpower providers a chance to circumvent the law but also denies the workers their constitutional and statutory rights.

NAPC Secretary Liza Maza also appealed to the media to try to move away from the thinking that if you give workers their due then there will be worse unemployment.

“It is as if we can never have full employment, when it’s a possibility if you implement genuine land reform and pursue national industrialization,” Sec. Maza said.

“What we need is a sweeping institutional reform in order to fulfill the commitment made by President Duterte in providing all workers a just, humane and decent work,” added Sec Liza Maza.

NAPC believes that to end exploitation and modern-day slavery, the issuance of an executive order should be based on the Constitutional demand of full protection, security of tenure, humane condition of work as well as living wage and income for the workers.

On their next en banc meeting with sectors and the president on May 15, NAPC intends not only to raise the issue of contractualization and request the president to issue an executive order prohibiting all its forms of contractualization and guaranteeing security of tenure. They hope President Duterte will also certify House Bill 4444 or the “Security of Tenure Act of 2016” and House Bill 556 or “An Act Prohibiting the Practice of Labor Contractualization and Promoting Regular Employment” as urgent bills.

Speaking at the joint press conference with NAPC and other labor groups, KMU Vice-Chairperson Roger Soluta expressed hopes that the NAPC’s position will strengthen President “Duterte’s commitment to end all forms of contractualization, against the strong opposition from the neoliberal triumvirate of Budget Secretary Benjamin Diokno, Finance Secretary Carlos Dominguez and NEDA Director Ernesto Pernia.”

Labor Secretary Bello has reportedly not commented on NAPC’s drafting of an EO against contractualization, but he would attend the en banc meeting of sectors and the President on May 15.

In a separate interview, Labor Undersecretary Joel Maglunsod was apologetic about the limitations of the DO 174.

“I am just one progressive in a sea of neoliberals in the Labor Department,” he said. Still, he hopes workers could take advantage of the other provisions of the DO 174 such as its ban on agency hiring as a means to avoid regularization of workers. Although others at the Labor Department have told him to stop acting and thinking as a KMU leader, ‘you’re now in DOLE,’ they told him, Maglunsod still welcomes the protesting workers and urges them to form more unions, more labor alliances and organizations, to strengthen their protests and amplify their calls. (

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