Labor Contractualization

Topics: Employment, Trade union, Tarlac City Pages: 11 (3571 words) Published: October 3, 2012
Chapter 1


Contractualization has become the main form of labor in many Philippine businesses, a good reason why there are hardly any labor unions in the country or why most workers are not organized in the new millenium. Contractual workers cannot afford to join unions because they are at the mercy of their employers. Many laws protecting workers protect only regular employment (Herrera, 2006). On the local scene, the general public is sounding the alarm on the steady growth of both unemployment and underemployment. The concrete situation of millions of sales ladies in our department stores and giant malls, some factory workers, house helpers, carpenters, gasoline boys, workers in the barber shops and parlors, whose jobs are “permanently temporary,” simply because they are contractuals. They have no stable jobs, no SSS, no medical insurance, no security of tenure—not to mention the 6 million Overseas Filipino Workers who are employed on a contract-to-contract basis, more than 70 percent of whom are domestic helpers and entertainers stationed in four corners of the globe. In the technical sense, contractualization is a form of underemployment. The right to adequate work and full employment is essential to all men and women of legal age, as swimming is essential to a fish and flying to a bird (well, most birds). This basic right springs from our intrinsic nature to self-preservation and our innate obligation to support our family, both of which are in accordance with the divine plan. Although underemployment (contractualization and part-time jobs) continues to exist in many various ways, there are no reasons adequate enough to justify it. The key principle is that full employment is a fundamental right of every citizen, which means the right to be protected from unemployment and underemployment is basic. The harsh reality, however, appears to contradict this idealism embodied in our constitution. Ever since the Philippines jumped into the GATT-WTO bandwagon, times have been especially difficult for labor. The name of the game is cheap labor. In order to attract foreign investors—aspiring to be competitive as they say with our Asian neighbors—we have to provide the cheapest labor possible. And this cheap labor comes through contractualization of jobs and services. It appears that contractualization is a scheme that allows capitalists to replace their workforce with ease according to market demands. This translates to maximization of profits for the company, but for the laborers, this system denies them the security and benefits of a regular job while being paid very low wages. Labor flexibilization schemes, such as part-time/contractual labor, subcontracting parts of the production process among smaller enterprises, subcontracting certain on-site services to other firms, agency labor-only contracting, and piece rate compensation strategies, have resulted in the stagnation in the number of unionized workers. The number of workers covered by collective bargaining agreements (CBA) has actually declined (Tuaño & Aldaba, 2000). Contractualization and other schemes of flexible hiring have led to the increase of non-unionizable workers. Unions are stripped of bargaining power as they lose control over production and workers (Tujan, undated). Villaseñor (2000) testifies that only the unionized regular workers are assured of permanent employment and income. A group of temporary workers is maintained as reserve labor force, to be called on any day that the production quota or fieldwork requires additional workers. A grower who acts as labor contractor does the hiring. Applicants are not required to submit any document. Neither are they given written copies of a contract. Instead, their names are simply listed alphabetically. Shoemart, as SM was originally known as, is the Philippines' leader in the retail industry and comprises of the SM Group of Companies. SM Group is a retail...
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