No to contractualization; Yes to a national minimum wage! - Philippines 2019

"I’m Analou Paquera, 27 years old and currently working in the UNI ELEMENTS ENTERPRISES located in Malanday, Valenzuela City (Manila metropole). I was born in Cotabato, Mindanao and I choose to migrate to go in Manila to look for a better job because of lack of opportunities in my province. I am working in UNI ELEMENT since 2015 as part of the production line. I make the chemicals that are necessary to produce liquid soap and bath soap.
In 2015, my salary was 250PHP (4,5 euros) for 12 hours of work. I had no benefits like SSS (social security), PhilHealth or any other social insurance. In the company there are many violations of the labour law by the employer, lack of overtime payment, 13th month pay. The workers are also exposed to the chemicals without protective equipment, which are very harmful. In 2019, I met the organizer of Young Christian Workers (YCW) in Malanday Valenzuela with my fellow workers and we have shared about of all the young workers in the UNI ELEMENTS Factory. We decided to organize my fellow workers to change our reality.
We filed a case in the Department of Labor and Employment (DOLE) for the violation of the minimum wage regulations, for the non-remittance of our social insurance benefits and to get our underpaid salary of a period of almost 5 years. After negotiating with the employer and the DOLE, we finally got our unpaid salary. My employer paid me 45.000 pesos (800 USD) back pay. He was also forced to increase my daily salary from 250 pesos (4,5 euro) to 700 pesos (12,5 euro).
Our experience in organizing to demand salary increase was not easy. We have faced many challenges in organizing dialogue and negotiations with the employer and the DOLE, because we didn’t know before how to do it. But YCW helped us by sharing their own experience on how to deal with this. As of now, we still need to continue to organize the workers here in UNI ELEMENTS because even though my salary was increased, my job status is still as contractual worker.”

Political, economic and social context of the Philippines
Throughout 2019, the Philippino government continued curtailing the freedom of speech and association of human and labour rights activists, independent journalists and trade unions. With Executive Order 70 the red-tagging of progressive workers’ organizations as communist and terrorist organizations has intensified. The authorities have already used EO70 to target local unions in areas where there are Chinese investments.  At the International Labour Conference in Geneva the ILO decided to schedule a high-level mission to the Philippines for an investigation into the killing of 43 labour activists in the last 3 years, a mission which to date the Philippino authorities has not yet allowed to enter the country. In the meantime, due to the passing of the Tax Reform for Acceleration and Inclusion Act (TRAIN) in 2018 prices of basic goods and services continued to rise in 2019. One study found that the law can create a monthly loss of up to 3.000 pesos (± 53 euro) per family. Last year the Expanded Maternity Leave was adopted, extending maternity leave with full pay from 60 to 105 days. A Universal Health Care Act was also passed, supposedly lowering out-of-pocket health expenses but according to the partner organizations, this law will only contribute to the further commercialization and privatisation of public health care services.

Putting an end to contractualization in Philippines

Contractualization, while in most cases illegal, is a commonly used practice in Philippino companies to give workers temporary employment for just less than 6 months preventing them to be regularized. Short-term contract workers do not have the same benefits as regularized workers, such as social security, health insurance (Philhealth), unpaid leaves, a 13th month bonus. Moreover, contractual workers will be less eager to become a union member as they risk not having their contract renewed. While the Philippino president had vowed to phase out contractualization and has signed an executive order to that end, in reality the practices of labour-only contracting and job contracting are still omnipresent in Philippino companies. 

KMU decided to focus their campaign against contractualization on mass filings for regularization, which appeared to be much more effective than individual legal aid to the workers. Contractual workers would file a document to the Department of Labour and Employment that they want their company to be investigated on compliance with the regulations on contractual work and security of tenure and that they want to be regularized as permanent workers. The lists that were filed contained some 2.900 to 3.000 companies with 300.000 workers which could be up for regularization. In some cases (Coca Cola, Magnolia), several hundreds of workers managed to become permanent workers, while others were not granted such status.

Due to the attention that was given to the campaign against contractualization, the All Workers’ Unity (an alliance of labour centers advocating for a national minimum wage and for an end to contractualization), could not make substantial progress on the demand for higher minimum wages. 

Philippines in numbers in 2018: Main results

Labour standards:
Health workers: In 2018 the AHW reached out to some 110.920 health workers and Philippino patients (of which 54 % women and 51% young people). Through social media and campaign materials some 100.000 health workers  were informed about the issues of public sector health workers, such as contractualization and privatization of hospitals. In four hospitals, a new collective negotiations agreement has been ratified with another hospital, negotiations are ongoing, potentially creating better union rights for 5.127 health workers. Bill n°7437 prohibiting the privatization of public hospitals and public health services was passed in the House of Representatives.
Young workers: In 5 locations (Manila, Negros, Ilo-ilo, Cebu, Camarines Norte) 1.488 young people (young workers, students, of which 39 % women) were organized and trained by the YCW on basic labour rights, contractualization, the TRAIN – law, social and economic problems of youth and how to overcome them.
National minimum wage and social protection for workers in the private sector: Trade union confederation KMU raised the awareness of 44.298 Philippino workers (of which 49% women and 49% young people) on the need for a national minimum wage and the end to contractualization. 1.062 workers, some of them working in expert-processing zones or multinational companies,  participated in different activities: basic training, mobilizations, legal assistance.
Joint advocacy: The three WSM partner organisations are key partners in the All Workers’ Unity, an alliance of different labour centers who are advocating for a national minimum wage of 16.000PHP/month in the public sector, 750PHP/day in the private sector and against contractualization. In 2018, the campaign of the alliance reached some 40.000 workers (of which 25% women and 30% young workers).

Partner organizations in the Philippines: AHW (Alliance of Health Workers’ unions), KMU (trade union confederation), YCW Philippines (young workers’ organisation), Philippines Synergy network (core organisations of the AWU – All Workers’ Unity)
Budget 2018: 75.627,76 euro
Donor: DGD, LBC-NVK
Program: 2017-2021