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Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

EIGHTEENTH CONGRESS
First Regular Session

House Bill NO274

Introduced by DIWA Party-list Representative Hon. Michael Edgar Y. Aglipay

EXPLANATORY NOTE

Every year, the Business Process Outsourcing (BPO) industry is always expected
to generate billions in earnings and hundreds of thousands of jobs. The Information
Technology and Business Process Association of the Philippines predicts that the
Philippine information technology and business process management (IT-BPM) and
global in-house center (GIC) industries will generate $25. billion by this year (2016)
and provide direct employment to 1.3 million Filipinos, while supporting 3.2 million
indirect jobs.

Without question, the BPO industry will play a major role in the economy of the
nation and the livelihoods of millions of Filipinos for the foreseeable future. However,
current legislation has not yet been adapted to take into account the special
characteristics of the BPO industry, and the special needs of BPO workers. This
refiling of House Bill 156 of DIWA Party-list filed during the 17 Congress, aims to
rectify this omission, and bring Philippine laws up to date with regard to this vital new
industry.

MICHAEL FDGAR/Y. AGLIPAY
Representdtive, DIWA Party-list.

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Republic of the Philippines
HOUSE OF REPRESENTATIVES
‘Quezon City, Metro Manila

EIGHTEENTH CONGRESS
First Regular Session

House Bill No.0274

Introduced by DIWA Party-list Representative Hon. Michael Edgar Y. Aglipay

AN ACT ENSURING THE WELFARE AND PROTECTION OF BUSINESS PROCESS
OUTSOURCING (BPO) WORKERS IN THE PHILIPPINES

Be it enacted by the Senate and House of Representatives of the Republic of the Philippines in
Congress assembled:

SECTION 1. Short Title. - This Act shall be known as the "BPO Workers’ Act"

SECTION 2. Declaration of Policy. - I t is hereby declared the policy of the State to
protect the rights, and promote the welfare of workers in the Business Process Outsourcing
(BPO) industry and to take appropriate steps to recognize such rights and welfare, while
taking into account the special characteristics of the industry. The State shall strive to
improve and promote their social and economic status, living and working conditions, terms
of employment, professional growth and career development.

SECTION 3. Coverage. - This Act shall cover all employees in the Business
Processing Outsourcing industry.

SECTION 4. Definition of Terms. - For purposes of this Act, the following terms
shall be understood as follows:

a) “Business Process Outsourcing (BPO) is defined as the delegation of se
type business processes to a third-party service provider.
into the

b) following sectors: call centers, back office services, data transcription,
animation, software development, engineering development and game
development. Most BPO companies engage in shift work to complete their 24-

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ice-
is generally divided



hour work cycle.

©) “Call Center” also known as contact center, refers to a central customer
service operation where agents - whatever their designation - handle business-
related telephone calls, and other IT- related non-voice activities, on behalf of a
client.

4) “Employer” includes any person or enterprise acting directly or indirectly in
the interest of an employer, in relation to an employee, and shall include
government-owned or controlled corporations and institutions, as well as non-
profit private institutions or organizations. Indirect employees or contractors
shall also be considered “employers” in this Act.

©) “Employee” shall mean any person hired, permitted or suffered to work by an
employer

©) “Health” shall connote a sound state of the body and mind of the worker,
which enables him to perform his job normally, in a state of well-being.

) “Safe or safety” shall refer to the physical or environmental conditions of work
or employment, which substantially comply with the prescribed Standards, as
defined below.

8) “Work Accident” shall mean an unplanned or unexpected occurrence that may
‘or may not result in personal injury, property damage, work stoppage or
interference or any combination thereof: which arises out of and in the course
or employment.

h) “Work Injury” shall mean any injury or occupational illness suffered by a
person, which arises out of or in the course of employment

i) “Occupational Iliness” shall mean any illness caused by environmental factors,
the exposure, to which is characterized or peculiar to a particular process, trade
‘or occupation, and to which an employee or worker is not ordinarily subjected
to, or exposed to, outside of or away from such employment.

i) “Workplace” means the office, premises or work site, where the workers are
habitually employed and shall include the office or place where the workers,
who have no fixed or definite work site, regularly report for assignment in the
course of their employment.

k) “Approved” shall mean acceptable to the Secretary of Labor and Employment,
as indicated in writing, after a proper examination showing compliance with
prescribed Standards.

}) “Code” shall mean Presidential Decree 442, the Labor Code, as amended.

m) “Agencies” shall mean government agencies mandated to monitor, administer,
promote, and ensure health and safety regulations and standards. ‘These
agencies are the Department of Labor and Employment, Bureau of Working
Conditions, Employees Compensation Commission and Occupational Safety
and Health Center.

n) “Department” shall mean the Department of Labor and Employment.

0) “Secretary” shall mean the Secretary of Labor and Employment.

p) “Bureau” shall mean the Bureau of Working Conditions.

4) “Director” shall mean the Director of the Bureau of Working Conditions.

1)“Standards” shall mean the Occupational Safety and Health Standards and
regulations, as described in Section 18.

s) “Enforcement Officer” shall mean the industrial safety engineer, the labor

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regulation officer, or any duly authorized representatives of the Secretary
charged to enforce the Standards.

1)“duthorized Representative” shall mean and include any employees or officials
‘of other government agencies empowered by the Secretary of Labor and
Employment to enforce the provisions of the Standards.

u) “Workplace Occupational Health and Safety Representative" (WOHSR) is
defined in Section 21 of this Act.

v) “Registered Party” shall mean any duly registered non-stock non-profit
organization advocating occupational health and safety (OHS).

w) “Shift Work” shall mean the employment practice designed to make use
of the 24 hours of the day. Employees are given schedules which correspond to
a 24-hour work cycle. The term shift work includes both long-term night shifts
and work schedules in which employees change or rotate shifts.

PART ONE: GENERAL EMPLOYMENT STANDARDS

SECTION 5. Standard of Treatment. - The employer and the supervisors must, at all
times, treat the BPO worker in a just and humane manner and ensure and provide that rights
and benefits of BPO workers be accorded them as mandated by the Code. Abusive language,
physical violence or any act which debases the dignity of a person shall not be used against the
employee.

SECTION 6. Access to Relevant Information. - The State shall ensure the BPO
companies allow their workers and employees access to relevant information to make them
understand their rights, benefits, obligations, conditions and realities attending to their
profession. BPO companies shall not restrain their employees from organizing or attending
activities, such as, but are not limited to, workshops and symposia, that seek to equip BPO
workers with relevant information with regard to their rights, welfare and conditions.

SECTION 7. Protection from Understaffing or Overloading. — There shall be no
understaffing or overloading of BPO workers. The ratio of BPO worker to client quota or
quantitative targets shall be such as to reasonably effect a sustained quality of service at all
times without overworking the worker and over-extending his/her services beyond what is
stipulated in the employment contract, or what is allowed as the worker's regular hours of work
‘The employer may request the employee to perform tasks beyond the duties stipulated in the
employment contract; Provided, That the employee consents and that such tasks are duly
compensated by the employer with an additional pay of not less than 25% of the regular rate
per hour.

SECTION 8. Regularization. — All BPO workers shall be considered regular
employees upon the completion of their sixth month of employment as trainee or apprentice,
or upon the completion of a maximum probationary training period of six months.

SECTION 9. Right to Self-Association. - It shall be unlawful for any person or
company to restrict the right of BPO workers to join, organize, or assist organizations, to
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collective bargaining and to participate in the deliberation of issues and in the formulation of
policies that affect them, in accordance with the Code.

SECTION 10. Freedom from Excessive Company Bond. - It shall be unlawful for
any person or company to compel a BPO worker to commit to a company bond, imposing an
unreasonable fee to be paid by the employee upon leaving the company before a specified
length of time.

SECTION 11. Protection from Discrimination. - BPO workers shall be protected
from discrimination by reason of sex, sexual orientation, age, political or religious belief, civil
status, pregnancy, physical characteristics or disability, or ethnicity.

SECTION 12. Hours of Work. - The hours of work for BPO workers shalll be
governed by the provisions of the Code, as supplemented by other applicable laws as well as
this Act.

SECTION 13. Work on Holidays. - BPO workers may be required to work on days
designated as non-working holidays in the Philippines given the nature of their profession;
Provided, That the employer shall duly compensate the employee's work on such days in
accordance to existing laws with regard to holiday pay.

SECTION 14. Leave Benefits. - BPO workers shall be entitled 10 all leave benefits and
privileges, such as but not limited to maternity, paternity, vacation and sick leaves, as provided
for under existing laws: Provided, that upon separation of the employee from service, they
shall be entitled to all accumulated leave credits with pay. No employee may be terminated
based solely on unapproved leaves without affording the employee due process in an
administrative proceeding.

SECTION 15. Transportation Benefits. - In the absence of or in the lack of safe and
adequate public transportation services in BPO workers’ places of work, they shall, at least
between 9:00 p.m. and 6:00 a.m., be entitled to safe transportation service, which may include,
but are not limited 10 shuttle services, to and from the place of work to designated drop-off
points, to be provided by the company in order to facilitate the safe commute of employees at
vulnerable times.

SECTION 16. Security of Tenure. - No employee may be terminated except for just
cause as may be provided by the Code and other existing laws and after due process in an
administrative proceeding as provided for under the law.

PART TWO: OCCUPATIONAL HEALTH AND SAFETY
STANDARDS AND REGULATIONS

SECTION 17. Employers’ Obligation. Article 106 of the Code expressly prohibits
“labor only" contracting. Employers engaging independent contractors to perform work on
their behalf have a duty to minimize the health and safety risks of the contractor's
employees. This is because they are deemed to be employees for the purposes of the Code,

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as well as this Act, and because employers have a duty to protect third parties at or near their
workplace. A failure to maintain a safe workplace for the contractor's employees may
constitute a contravention of the employer's general duly under the Law.

SECTION 18. Occupational Health and Safety Standards and Regulations for
BPO Workers. - Pursuant to its mandate, the Department of Labor and Employment is
tasked to establish Occupational Health and Safety Standards (Standards) for BPO work.
The Standards shall adhere to the prevailing standards of health and safety for BPO work
and other similar employment. It is imperative that, the minimum provisions in the
Standards meet the International Labor Organizations recommendations. The Standards
should be reviewed annually by the agencies, WOHSR, and registered interested parties, and
must include provisions related to the Enforcement Officers and Authorized
Representatives, as well as the WOHSR as defined below.

SECTION 19. The Nature of BPO Night-Shift Work. - Establishments engaged in
shift work to complete their 24-hour work cycle expose their employees to health and
security risks, as well as unnatural stresses, and as such night- shift work is considered to be
hazardous under this Act.

SECTION 20. Compliance with the Standards. - The Standards shall be strictly
enforced in all establishments operating in the country. Compliance with the provisions of
the Standards shall be mandatory and subject to inspections by Enforcement Officers and/or
‘Authorized Representatives, as shall be outlined in the Standards.

SECTION 21. Workplace Occupational Health and Safety Officer. — From
among the employees, a Workplace Occupational Health and Safely Officer (WOHSO) shall
be elected for the purposes of consultation and in-house monitoring of the Standards. The
WOHSO shall review the measures taken to ensure the health, safety, and welfare of the
employees; investigate and attempt to resolve any matters that may be a risk to health and
safety at the place of work. The employees may elect more than one WOHSO representative
upon approval by the Department. The powers, functions, and manner of election the
WOHSO shall be included in the Standards, subject to the following guidelines: (a) that all
‘employees are entitled to vote in an election of the WOHSO; (b) that the powers of a
WOHSO shall include, but not be limited to, the powers to inspect any part of the
workplace, and to require the establishment of a health and safety committee.

SECTION 22. Workplace Policy on Occupational Health and Safety. - Each
establishment shall formulate their own occupational health and safety policy, which adheres
at minimum to the Standards as defined in Section 18 of this Act. Any additional safety
measures deemed appropriate to the nature of the localized work environment may also be
included, pending approval by the Bureau. The policy must be reviewed annually by the
employers, the WOHSO and an Enforcement Officer or Authorized Representative.

All employees shall be informed of the OHS policy. Informational materials such as posters,
brochures and similar devices shalll be distributed to die employees free of charge.

SECTION 23. Health Program. The company physician shall, in addition to his

duties stated in the Labor Code, develop and implement a comprehensive occupational
health program for the benefit of all employees.

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SECTION 24. Health Insurance. All employees are entitled to free full medical
examination upon commencement of employment, and annually during the tenure of
‘employment. The establishment shall provide full health insurance to the employees, the
coverage of which shall be agreed upon by the company and its employees.

SECTION 25. Work-Related Injuries, Sickness and Death Compensation. All
employees and their dependents shall be also be compensated for injuries,
medical complications, illness, disability and death arising from, and related to,
their work, in accordance to existing laws, labor policies, guidelines or circulars
as the case may be. The Employees Compensation Commission shall promptly
process any claims for/by injured, disabled, deceased employees or their
dependents.

SECTION 26. Prohibition Against Elimination or Diminution of Benefits. —
Nothing this Act shall be construed 10 eliminate or diminish in any way existing
benefits being enjoyed by BPO employees at the time of the effectivity of this
Act, or benefits beyond the minimum standards set forth by this Act.

SECTION 27. Penal Provision. - Any person or company who violates the
provisions of this Act shall be punished with a line of not less than One Hundred
‘Thousand Pesos (P100,000) and/or imprisonment of not less than two (2) months
but not more than one (1), or both, at the discretion of the Court.

SECTION 28. Separability Clause. - If any provision of this Act is declared
nal, the same shall not affect the validity and effectivity of the other
provisions hereof.

SECTION 29. Repealing Clause. - All laws, executive orders, presidential
decrees, presidential proclamations, rules and regulations or parts thereof
inconsistent with the provisions of this Act are hereby repealed or modified
accordingly.

SECTION 30. Effectivity Clause. - This Act shall take effect fifteen (15) days
from its publication in the Official Gazette or at least two (2) national newspapers
of general circulation.

Approved,

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