Contractualization is the practice of hiring workers for a period of about five months before they are relieved of their job assignments, only to be replaced by another employee who is willing to go through the same process. This manner of employment strips the worker of his right to security of tenure and other benefits enjoyed by a regularly employed individual. It is for this reason that Filipinos are clamoring to put an end to this labor practice (deemed “unlawful” by many).
On the contrary, contractualization has, to a certain extent, contributed to making our country attractive to investors because they know they can get relatively cheap labor costs here. Pinoy workers, on the other hand, agree to be employed on contractual basis instead of not being employed at all. Often, individuals who have limited educational attainment and work experiences are drawn into this cycle (although contractualization is also practiced even in government agencies and offices) as it gives them an opportunity to earn a living in spite of not having ample academic training and the necessary skills and work experiences.
In view of the above, we endeavored to research on the most probable advantages and disadvantages of putting an end to contractual employment in the country. Who will truly benefit from this move? Who will suffer the consequences?
- Employees enjoy security of tenure and can look forward to a considerable retirement package after years of serving their employer.
- Companies’ investments on training and developing its people are maximized as they capitalize on employees’ loyalty and retention.
- Issues on security of trade information and business insights can be better addressed as there would be lesser staff turn-over.
- If a company could not afford to replace its contractual workforce with regular employees, it will be left with no choice but to pass the workload to its regular employees. Overworked employees, albeit paid the necessary overtime fees, may soon become lethargic and unproductive.
- Unemployment rates may skyrocket as job application requirements become more stringent and discriminating. Employers will most certainly require that applicants possess skills and talents worthy of the regular compensation they are mandated to provide.
Last Monday, the President issued a tall order for business firms, corporations, and agencies to cease placing its workers under contractual status, unless they are prepared to battle it out with him and lose their “money and their pants”.
Tell us what you think about the government’s directive to abolish contractualization. On which side of the barricade do you stand?
Is there even a barricade to begin with?