THE incoming Duterte administration will be stricter on contractualization, particularly among mall operators, where salespersons are hired then fired by the fifth month to avoid promoting them to regular status by the sixth month as required by law, the incoming Labor and Employment secretary said Friday.
Despite the country’s laws disallowing the practice of contractualization—a labor contract system that is good only for five months, incoming Labor secretary Silvestre Bello III admitted that many employers, particularly mall operators, usually find a way to circumvent labor laws.
“Mall operators usually circumvent the contractualization law. After five months, they would replace you so there won’t be any security of tenure,” Bello said in an ABS-CBN interview.
“It’s not right. There’s a penalty, and you can stop their operations [if they are found guilty],” he added.
Latest statistics from the Labor Department showed that the country has almost 35-million contractual workers out of 67.1-million workers as of 2016.
Contractualization or “endo” (end of contract) or “555” is a work arrangement whereby workers are only hired for only about five months without security of tenure, monetary, non-monetary and social protection benefits.
The law requires regularization or termination of those employed for six months.
During the last presidential debate, Duterte vowed to put an end to contractualization.
Bello said that while the “endo” (end of contract) or the “555” work arrangement is illegal, he said he would review the practice of most malls not to hire salespersons directly but go through employment agencies.
Bello said that he will also review labor laws which consider other forms of subcontracting as “lawful” that most businessmen use as excuses to circumvent the spirit of the law.
Laws on temporary contracting cover industries which are project-based by nature, such as business process outsourcing, car manufacturing, construction and even entertainment.
In May, the Trade Union Congress of the Philippines said that while the Philippines had one of the best performing economies in Asia, workers have not benefitted from the growth, partly because of the widespread use of contractual labor.
Many employers undermine the Labor Code by hiring workers through third-party manpower agencies and cooperatives, the TUCP said.