Grave implications of contractualization in fast food firms
The decision by DOLE NCR Regional Director Henry Jalbuena, ordering Jollibee to absorb almost 6,500 contractual workers as regular employees caused an immediate impact on the value of its equity shares in the stock market. Many players lost a lot of money and such a very disturbing development is bound to create more shocking and far-reaching implications for stockholders across the food business industry. Of course, my good friend, Jalbuena was only doing his job under the guidance of the DOLE undersecretaries and the secretary himself. Malacañan had been asking for results, and Jalbuena delivered.
This decision, and many other DOLE and NLRC rulings, make foreign investors rethink of investing in other ASEAN nations. If that happens, the biggest losers will be the working class and the government. The Philippines' standing vis-a-vis the World Economic Forum's Global Competitiveness Index has been sliding down. And the top problems besetting our country, in terms of being an investment destination, are the instability and the restrictiveness of labor and economic policies. Add to that our regressive tax policies and very high tax rates both for employers and employees. This decision is exacerbating our economy.
HR managers and lawyers of similarly fast food chains are now bracing for similar decisions. Jalbuena is just among the first ones to release his decision, other regions are expected to follow. Earlier, Jalbuena's predecessor Johnson Cañete, reportedly ordered PLDT to regularize thousands of contractuals. Regional Director Zenaida Campita of southern Tagalog region is well-known for her advocacy for regularization, as many companies in CALABARZON are always on their toes since Regional Office 4-A is perceived by the management sector as too unforgiving. I am now helping a lot of companies file their appeals to the office of the DOLE Secretary, then the Court of Appeals, and ultimately the Supreme Court.
To have a balanced view, we need to be fair to DOLE officials. They are just doing their jobs. In fairness, there are really functions that cannot be contracted away because they are directly related to the main business of the principal employer. There are also agencies and cooperatives that are fly-by-night; not sufficiently capitalized and without offices. Above all, some contractors cheat their workers in wages and benefits, and don't remit to SSS, Employees Compensation, PhilHealth and Pag-IBIG. DOLE has to cancel the registrations of these bad eggs, albeit they are a minority, majority follow the rules. We cannot blame DOLE if some principals and their agencies are declared labor-only contractors.
The Jollibee decision is just a tip of the iceberg. Down there where the rubber meets the road, many scoundrels and rascals in the manpower business deserve DOLE's own "tokhang" and summary execution. I can only say that most of the PALSCON (Philippine Association of Legitimate Contractors) member-agencies are the more professional ones. Let us expect more "blood" to spill.
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