Press Release / Labor And Employment

Villanueva Releases Committee Report on ‘Endo’ Bill


Senator Joel Villanueva, chair of the Senate committee on labor, employment, and human resources development, on Wednesday released the committee report on Senate Bill No. 1826 or the "Security of Tenure and End of Endo Act of 2018".
Once passed into law, the measure would remove the ambiguities in the Labor Code, which is the source of circumventions, and: (a) prohibit labor-only contracting, and provide penalties for violation (b) limit job contracting to licensed and specialized services, (c) classify workers into regular and probationary employees--and treat project and seasonal employees as regular employees, (d) provide security of tenure, (e) clarify standards on probationary employment, and (f) provide "Transition Support Program" for employees while they are not at work or transitioning in between jobs.
“Being caught in the cycle of intermittent 'endo' with no prospect of permanency derogates the Constitutionally guaranteed rights of workers, especially the right to security of tenure,” said Villanueva, principal author of the bill.
Villanueva said that in the process of producing the measure, "we learned the conflicting and contrasting interests of the different stakeholders. But we also learned that these interests converge. We all want economic growth, we want increase in productivity and we want better quality of life and we want certainty both in doing business and in employment."
"We believe that what we are proposing is consistent to these principles agreed upon by all stakeholders. Ending 'endo' is not anti-business. Guaranteeing the right to security of tenure gives our workers certainty and social protection. It makes them more efficient and more productive which is the primary concern of every business. Being pro-worker and pro-industry at the same time is not an impossibility," the senator stressed.
- Prohibition on labor-only contracting
Under the measure, Villanueva maintained the absolute prohibition on labor-only contracting. Labor-only contracting happens when a job contractor merely recruits and supplies workers to a contractee or the workers supplied by the job contractor are performing activities which are directly related to the core business of the said contractee or are under the control and supervision of the contractee.
Villanueva said that in cases of labor-only contracting, the job contractor shall be considered merely an agent, and the contractee shall be responsible to the workers as if the workers were directly employed by the contractee.
Further, in all cases where labor-only contracting is present, the workers shall be regularized by the contractee, retroactive to the date they were first deployed to the said contractee, without prejudice to any criminal, civil, or administrative case against the labor-only contractor and the contractee.
The bill also seeks to impose a fine of P5 million against any labor-only contractor. The secretary of labor and employment shall also have the power to preventively or permanently close the operations of any labor-only contractor.
"Ang 'endo' at labor-only contracting ay labag sa karapatan ng mga manggagawa. Dapat na po itong tuldukan sapagkat hangga’t nakalutang po ang isyu ng 'endo' at pang-aabuso sa kontraktwalisasyon, patuloy na maiipit ang mga manggagawa, nasasakripisyo ang trabaho, hindi makakausad ang bayan," Villanueva said.
"Kapag dehado ang mga manggagawa, walang panalo. Lahat po ay talo kabilang na ang mga mamumuhunan at negosyo. Ang mas makataong pagtrato sa ating mga manggagawa at pamamalakad ng ating mga negosyo ay nakatutulong sa husay at pagiging produktibo ng ating mga negosyo at ekonomiya. Kaya ang paglutas ng problemang 'endo' ay hindi lamang interes ng ating mga manggagawa kung hindi interes din ng mga investors at business owners—nating lahat," the senator added.
- Licensing of specialized contractors
The measure further provides for the licensing and regulation of contractors for specialized work, job or services, and imposes penalties for violations including the cancellation of license and administrative penalty for responsible Department of Labor and Employment (DOLE) officer who licensed a non-compliant contractor.  
Under the bill, the contractor must show proof of expertise and specialization by showing, among others, a core of competent professionals or skilled workers especially trained to carry out the job, work or service or track record in such field of specialization. 
The contractor must also prove that it has a paid-up capital or net worth of at least P5 million, which may be increased through tripartite consultation.
The license fee should not be lower than P100,000 and should be valid for three years and may be renewed upon compliance prescribed by the DOLE.
- Simplifying classification of workers
On the status of employment, all employees, except those under probationary employment, are deemed regular, including project and seasonal employees.
In project and seasonal employment, workers are called to work from time to time and temporarily laid-off during the completion of the project or off-season.
However, Villanueva emphasized that the "No work, No pay" policy applies under this provision.
"Halimbawa, sa pagpasok ng buwan ng Hunyo, tiyak na may mga manggagawa sa mga beach resorts na male-lay-off dahil off-season o tag-ulan na naman. Sa ngayon, ang mga manggagawang ito’y walang kaseguruhan na sa susunod na summer season, magkakaroon sila ng trabaho sa parehong resort. Sa atin pong panukala, ang mga seasonal employees ay may kaseguruhan na may babalikan silang trabaho sa parehong season sa susunod na taon," the senator explained.
"Samantala, ang mga project-based workers naman ay regular din sa buong durasyon ng proyekto at may proteksyon o garantiya sila na hindi matatanggal sa trabaho nang walang malinaw na dahilan at proseso," Villanueva added.
Meanwhile, probationary employment shall not exceed six months from the first day of service regardless of the nature of work to be performed. A probationary employee may be terminated if he or she fails to qualify to the standards set by the employer which shall be made known to the employee at the time of his or her engagement.
Villanueva further noted that the measure ensures that a worker who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights, full back wages, allowances, benefits, and the like. The employer shall also have the burden of proving that the termination is with rightful cause and due process.
The bill also seeks to establish a "Transition Support Program" (TSP) in the form of cash assistance for workers who are not at work or transitioning in between jobs conditioned on skills development or skills upgrading.
An affected worker may only avail of the benefits under TSP once a year.
"Inukit po natin ang ating ipinapanukalang batas na may pagsasaalang-alang sa higit sa nakararaming bilang ng mga manggagawa, lalo na iyong walang unyon at mga nasa informal sector--upang maipagbigay alam sa lahat ng mga manggagawa sa informal sector at mga nangangailangan ng serbisyo na ang mga benepisyong nakasaad sa Labor Code at social welfare laws ay minimum standards na dapat ipinapatupad, at maipagtanggol sila sa mga pang-aabuso sa kontraktwalisasyon na siyang nagpapalaki sa bilang ng mga manggagawang nahuhulog sa hanay ng inpormalidad," the senator stressed.
"We thank our colleagues in the Senate for their extensive comments and valuable inputs to this measure and for joining us in our consultations with the labor unions, and for their willingness to introduce amendments and improve this measure," the senator said.
"End Endo!” is the resounding call of Filipino workers nationwide. Certainly, we need a law that will not only uphold our workers' basic labor rights and restore dignity of work, but also a law that will promote quality employment without jeopardizing business operations but rather create more stable jobs for the Filipino people,” Villanueva said.