The Grey Chronicles

2010.November.4

Force Leave or Forced Leave? II



This post is a continuation of yesterday’s topic, Force Leave or Forced Leave?, regarding the plea of Global Steel Philippine (SPV-AMC) Inc. Labor Union-AWATU [GLOSPILU-AWATU] stating: “We, the GSPI regular workers are on FORCE LEAVE since June 4, 2010 and no regular source of income since then.”.

The Compressed Workweek, one of the Flexible Work Arrangements specified in DOLE Advisory No. 2 Series of 2009 [DA 02] is but a revival of another Department Order No. 021-90 [DO 21] entitled “Guidelines On The Implementation Of Compressed Workweek” issued last 31 August 1990. The rationale then for the implementation of a compressed workweek (CWW) was to avert further damage to the economy brought about by the oil crisis at that time.

Atty. Emerico O. De Guzman (2009), Senior Partner, ACCRALAW, claimed, however, “fifteen years after DO 21 and notwithstanding the issuance of DA 02, there are still legal issues surrounding the implementation of a CWW scheme.” These are:

1. The constitutional right of employees against involuntary servitude:

Recognizing this basic right of employees, DO 21 provided as a condition for implementation of the CWW scheme that the employees must voluntarily agree to work more than eight hours a day and the total work hours in a week should not exceed their normal weekly hours of work prior to adoption of the compressed workweek arrangement.

Under DA 02, probably realizing the administrative difficulties in securing the individual assent of the employees, Labor Secretary Patricia O. Sto. Tomas decreed that the CWW scheme may be implemented with the express and voluntary agreement of a mere majority of the covered employees or their duly authorized representatives. This agreement may be expressed through collective bargaining or other legitimate workplace mechanisms of participation such as labor-management councils, employee assemblies or referenda.

The requirement of DA 02 mandating majority consent might not altogether foreclose all legal issues arising from the implementation of a compressed workweek arrangement. In any case, since administrative regulations, such as DA02, are presumed to be valid until annulled, employers can continue to rely on the favorable provisions of DA02 until they are set side by competent authority. [Emphasis added.]

2. The right to overtime pay:

“One of the conditions under DO 21 for the implementation of the CWW scheme is that “If an employee is permitted or required to work in excess of his normal weekly hours of work prior to the adoption of the compressed workweek scheme, all such excess hours shall be considered overtime work and shall be compensated in accordance with the provisions of the Labor Code or applicable Collective Bargaining Agreement (CBA).” However, DO 21 also allows employees to waive their overtime premium pay for work performed in excess of the usual eight hours of work a day.

However, in DA 02, it is expressly declared that “unless there is a more favorable practice in the firm, work beyond eight (8) hours will not be compensable by overtime premium provided the total number of hours worked per day shall not exceed twelve (12) hours”. In effect, DA 02 did away with the waiver requirement under DO 21.

3. CWW effect on what is considered “practice” under Article 100.

“DA 02 provides that “unless there is a more favorable practice existing in a firm, work beyond eight (8) hours will not be compensable by overtime premium provided the total number of hours worked per day shall not exceed twelve (12) hours. In any case, any work performed beyond twelve (12) hours a day or forty-eight (48) hours a week shall be subject to overtime premium.”

The Supreme Court held in the case of Globe Mackay Cable v. NLRC (G.R. 74156, 29 June 1988) that for the rule against diminution of supplements or benefits to apply, it must be shown that the grant of the benefit has ripened into a practice over a long period of time, that the practice is consistent and deliberate, and that the practice is not due to error in the construction or application of a doubtful or difficult question of law. Thus, where the benefits are not deliberately given but are instead given by force of policy issuances of the DOLE, as in the case of overtime pay under a CWW scheme, then, arguably, the grant of said benefits cannot possibly ripen into a company practice.

In January 2009, Labor Secretary Marianito Roque urged employers to adopt flexible work arrangements to minimize the effects of the global financial crisis on local employment. Roque said, however, that the adoption of flexible arrangements should be voluntary, thus, it must have the consent of both management and employees (Tan, GMANews.TV, 2009). Soriano (2009) notes:

“The DOLE recognizes the desirability and practicality of flexible work arrangements that may be considered by employers after consultation with the employees by taking into account the adverse consequences of the situation on the performance and financial condition of the company.” [Emphasis added.] (Soriano, 2009).

Global Steel Philippines (SPV-AMC), Inc. [GSPI] started No Scheduled Work [NSW] in November 2008. On 04 December 2008, GSPI’s personnel went on Forced Leave, but they could not avail of their respective leave credits. Interestingly, both instances predate the DOLE’s most recent call for companies to adopt a flexible work arrangements. Similarly, a total of 320 firms from across all industries, with the manufacturing sector leading, availed of allowable flexible work arrangements covering the period October 2008 — May 2009 (Molina, 2009).

In February 2009, Anakpawis Partylist Rep. Rafael Mariano demanded the rescinding of DoLE Advisory No. 2 because it ”only legalized the rampant flexible working conditions already taking place in companies.

“With the DoLE Advisory No. 2, the government gave companies the blanket authority to further exploit workers and violate their rights and welfare. The only ones who stand to gain with these work arrangements are employers. Workers will be left with lesser take home pay, fewer benefits and even more exploited.”

“With the financial crunch heavily affecting export companies, employers complain more about the high cost of doing business in the Philippines. Their corporate instincts would then dictate them to further lower production costs and maximize their workforce through flexible labor conditions in order to squeeze out more profits.” (Pinoy Press, 2009) [Emphasis added.]

In July 2009, the Institute for Labor Studies issued an rapid appraisal of Flexible Work Arrangements [FWA] which found, among others:

“The elements that facilitated the FWA implementation, namely, transparency in the financial condition of the firm, objectivity in selecting the workers to be affected by the FWA scheme, open and continuous dialogue with workers, and the assurance of reverting to ordinary work schedules when business condition normalizes, are revealing guideposts that may be considered in the review of DA 02-09.”

Moreover, Representatives Maglunsod and Mariano (2009) filed House Resolution No. 1234 urging the Department of Labor and Employment [DOLE] to immediately lift DOLE Advisory No. 2 [DA 02] as well as strenuously remind DOLE to issue [sic] orders violative of existing laws. Annotations : Maybe the Representatives meant: NOT to issue such orders?


Notes:

De Guzman, Emerico O. (2009). Legal Issues Arising From Varying Compressed Workweek Arrangements. ACCRALAW, 04 February 2009. back to text.

Department of Labor and Employment [DOLE] (2009). Department Advisory No. 2 Series of 2009. Manila: Department of Labor and Employment [DOLE], 29 January 2009. back to text.

House of Representatives (2009). Congressional Record, Plenary Proceedings of the 14th Congress, Third Regular Session. Vol. 1, No. 2. Manila: House of Representatives, 28 July 2009. p. 8. back to text.

Molina, Ryan Herman H. (2009). A Rapid Appraisal of Flexible Work Arrangements as a Global Financial Crisis Adjustment Measure. ILS inSights Policy Briefing. Issue 9. Manila: Institute for Labor Studies, July 2009. 2pp. back to text.

Pinoy Press (2009). Solon Demands Revocation of DOLE Advisory No. 2. Pinoy Press, 13 February 2009. back to text.

Soriano, Maria Teresa M. (2010). Department of Labor and Employment’s Response to the Impact of the Financial Crisis, Asia-Pacific Social Science Review. 9:1 Manila: De La Salle University, 2009. pp. 47-50. back to text.

Tan, Kimberly Jane T. (2009). Employers asked to adopt flexible work arrangements. GMANews.TV, 30 January 2009. back to text.

Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 LicenseDisclaimer: These posts do not necessarily represent any organization’s positions, strategies or opinions; refer to this blog’s self-imposed rules: A New Year; New Rules. Unless otherwise expressly stated, posts are licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License. Comments are moderated to keep the discussion/s relevant and civil. Readers are responsible for their own statement/s.

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