NEDA urges improvements in Security of Tenure bill

MANILA, Philippines — The National Economic and Development Authority (NEDA) has informed President Duterte of the need to improve the Security of Tenure bill to balance the interests of businesses and workers.

In a briefing yesterday, Socioeconomic Planning Secretary and NEDA chief Ernesto Pernia said that in its current form, the bill may be a deterrent to attracting investments and employing more workers.

Pernia said the agency provided its comment to the bill last month when its input was solicited.

The business sector, he said, also met with President Duterte to provide data to support their opposition to the bill that seeks to end illegal labor contractualization.

“We gave our comments. Essentially there is a need for tweaking to address some of the provisions,” said Pernia. “It has to benefit not only the workers, but also the employers because if investments are deterred, there will be less job opportunities.”

Part of the consideration for NEDA’s recommendation to the President is the rapid growth in the country’s labor force that would need to be given jobs.

Data from the Philippine Statistics Authority show that the country’s labor force – comprising members of the population aged 15 and above – has grown to 72.54 million from 71.02 million in the same month last year.

“We have a very high labor force growth. We really have to keep up with so many workers coming on stream,” said Pernia said.

As the bill necessitates finetuning, Pernia said it should be refined in the 18th Congress like what was done to the coco levy fund bill that had been refiled and identified as a priority bill by President Duterte in his SONA.

“Like I said before, it has to be fair between workers and employers because if you want jobs to be available, you need investments,” he said. “Also from the employee side they said its not adequate. It can be difficult to please everybody.”

The bill lapses into law on July 27 if no action is taken.

Business groups have urged President Duterte to veto the bill and instead modernize labor regulations to suit the needs of labor-intensive industries.

The groups argued that the bill is already made redundant by existing laws that protect workers from illegal contractualization. It also goes against the constitutional rights of businesses to contract labor as part of their management prerogative, they said.

Joining the call for a veto of the bill are the American Chamber of Commerce of the

Philippines, Australian-New Zealand Chamber of Commerce, Canadian Chamber of Commerce of the Philippines, European Chamber of Commerce of the Philippines, IT and Business Process Association of the Philippines, Japanese Chamber of Commerce and Industry of the Philippines, Inc., Korean Chamber of Commerce Philippines, Makati Business Club, Management Association of the Philippines, Philippine Association of Multinational Companies Regional Headquarters Inc., Philippine Chamber of Commerce and Industry, Semiconductor & Electronics Industries in the Philippines Inc. and Foundation for Economic Freedom.

The groups said the bill could have the opposite effect on job creation and security of tenure as enterprises may choose to eliminate the low-skilled jobs currently contracted out to service providers by using automation and artificial intelligence, redesigning work processes, or transferring work to more investor-friendly foreign destinations.

The groups also urged the easing of restriction on foreign investments that can significantly generate jobs in the country.