MANILA – What do the likes of SM, Jollibee and PLDT, among many other top 1,000 corporations, have in common?
During peak seasons, they hire workers on a temporary basis, a practice known as “Endo” or end-of-contract.
As one of his campaign promises, President Rodrigo Duterte vowed to end the practice, and he is expected to fulfill that promise as soon as he returns from his visit to Japan this week.
In one of the rare occasions when the majority and the minority in both the Senate and the House of Representatives acted in unison, the bill that would put an end to endo was forwarded to Malacanang for President Duterte’s signature this week.
So united were the two chambers of Congress that the House simply adopted the Senate version (Senate bill 1826), which was passed with a 15-0 vote last week. No bicameral conference committee was necessary.
The apparent end to labor-only contracting is expected to be welcomed by the country’s labor organizations, but the business community is not happy at the development. And neither are members of the economic cluster of the Duterte cabinet, who had earlier spoken out against the measure.
The Employees Confederation of the Philippines (ECOP) warned that the law would harm the chances of enticing more local and foreign investors to expand their operations. ECOP president Donald Dee defended labor-only contracting as a “business model” that was accepted all over the world.
End endo, Dee said, “does not make sense.”
The Philippine Chamber of Commerce and Industry agreed with ECOP, as did the American Chamber of Commerce of the Philippines.
In the Duterte cabinet, Finance Secretary Carlos Dominguez and Trade Secretary Ramon Lopez had expressed misgivings about ending endo.
The country’s largest labor organization, the Trade Union Congress of the Philippines, fully supported the bill.
However, more extreme labor organizations were not totally satisfied with the version submitted for Mr. Duterte’s signature as some forms of sub-contracting will still be allowed.
Private companies can still farm out jobs to third parties, which can then provide workers exclusively for them. Security guards and janitorial services are included.
The practice of endo evolved when local companies found a need for temporary workers during peak seasons, when demand for their products or services are higher.
Labor organizations, however, claimed that many private companies abused the practice by skirting Philippine labor laws, which state that any worker employed by a company automatically becomes a regular employee after completing six months of continuous service.
Some of the largest companies would simply hire workers and end their employment before the sixth month, only to rehire the same employees after a short period.
Workers could therefore be connected with companies for years, but remain contractuals due to the endo practice.
A variation of the endo practice is common in the Middle East, where millions of Filipinos are employed. They may commonly be “under contract” for two years, and are then sent home after their contract expires. The overseas Filipino workers are then allowed to return to their employer under a new contract, usually under the same terms and conditions.