Labor party calls for strict regulation of labor standards in BPO industry

Press Release

August 2, 2012

The Partido ng Manggagawa (PM) today called on the government to strictly monitor and enforce labor standards in the business process outsourcing (BPO) industry in the wake of the abrupt closure of a call center in Cebu City which left more than 600 workers without jobs and with unpaid wages, benefits and unremitted social security contributions.

“In the SONA of President Benigno Aquino III he applauded the BPO industry but behind this so-called sunrise industry lurks storm clouds that batter workers’ working conditions. Within an industry which prides itself with above-standard systems are substandard practices that are common in other businesses. The Labor Department and other agencies cannot be complacent that all is well for workers in the BPO industry. But the best regulator of labor standards are empowered workers and so we call for representatives to be elected by workers with the mandate to talk with management regarding working conditions, terms of employment, employee benefits and work load including setting of quotas, metrics and performance indexes,” said Renato Magtubo, PM national chairperson.

PM is assisting the employees of Direct Access Corporation, a locator in the Asiatown IT Park in Cebu City, which shutdown without due notice last July 30 to the surprise of its workforce. In arguably the first such protest among BPO workers, hundreds of Direct Access employees spontaneously held a rally last Monday in the prestigious ecozone.

Dennis Derige, PM-Cebu spokesperson, announced that the scheduled teleconference today between leaders of the Direct Access workers and the US-based owner was postponed for tomorrow. He also explained that no agreement was reached yesterday at mediation called by the National Conciliation and Mediation Board, and a meeting with the Cebu tripartite industrial peace council. “Direct Access workers welcome the offer of employment at other BPO companies even as they press for their demands with the different institutions that are intervening. They demand justice for workers, the payment of some PhP 6.4 million in wages and other emoluments, and the company’s culpability for violations of labor laws,” Derige insisted.

Magtubo recognized that numerous studies have called attention to health and safety concerns specific to the BPO industry, especially due to the graveyard working shift prevalent in call centers. “BPO companies must provide health insurance that is on top of the mandatory Philhealth membership and guarantees wider coverage and better benefits that especially address call center-specific health issues and afflictions.”

“Further, government must push for industry-wide standards for wages, benefits and entitlements that is well above the minimum set by law and commensurate to the dollar-earning nature of the BPO sector.” Magtubo argued. In the SONA, President Aquino mentioned that the BPO industry already employs more than 600,000 workers and earns revenues of some PhP 11 billion, equivalent to 5% of the country’s GDP.