'End endo' bill needs tweaking – NEDA

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Metro Manila (CNN Philippines, July 24) — The National Economic and Development Authority (NEDA) has recommended some adjustments to the bill prohibiting labor contracting, which lapses into law this week.

"We were asked to give comments, we submitted. Essentially just a tweaking, there's need for some tweaking, adjustment in some of the provisions," Socioeconomic Planning Secretary Ernesto Pernia said in a media briefing Tuesday.

He did not specify NEDA's recommendations, but stressed that "we have to be sure that the law benefits not only workers but also the employers."

Pernia explained, if the businessmen "shy away from investing because of the Security of Tenure bill, then it's not good for the workers, there will be less job opportunities."

President Rodrigo Duterte has until July 27 to either sign or reject the proposed Security of Tenure Act, which requires businesses to directly hire employees and effectively prohibits the practice of outsourcing workers through manpower agencies. Otherwise, it lapses into law.

Pernia said the President can also veto some of the provisions, meaning the measure will be sent back to Congress. Speaking to the media right after his fourth State of the Nation Address, Duterte said he was still studying the measure.

Thirteen members of the Joint Foreign Chambers and Philippine Business Groups earlier asked Duterte not to enact the bill, which mandates an employer-employee relationship, where the company would either have to absorb or regularize workers. It also states that all employees, except those on probationary status, will be treated like regular, including project and seasonal employees, entitling them to benefits received by regular workers.

But the business chambers argued that the decision to hire regular or temporary workers should be solely their call. They also warned that the proposed measure could dampen overall economic activity, saying that some firms may opt to remove low-skilled work altogether, to be replaced by automation and advanced technology. Worse, companies may choose to relocate to "more investor-friendly" locations abroad.

READ: Duterte to consider business groups' call vs. 'endo endo' bill – Palace

Duterte certified the bill as urgent as early as September 2018, allowing lawmakers to fast-track its passage. Labor groups have called on him to fulfill his campaign promise of ending all forms of illegal contractualization or "endo."

"Endo" or "end of contract" is a highly contested form of contractualization widely practiced in the country – workers are hired for not more than five months, so employers don't need to regularize them on the sixth month as mandated by the Labor Code. It strips millions of workers of all the benefits granted to regular employees by law.

CNN Philippines' Melissa Lopez contributed to this report.