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

SEVENTEENTH CONGRESS
Third Regular Session

House Bill No& 978

Introduced by DIWA Party-list Representative Pepito M. Pico

EXPLANATORY NOTE

Every year, the Business Process Outsourcing (BPO) industry generates billions in
earnings and hundreds of thousands of jobs. As of 2017, the BPO industry has employed 1.15
million employees. It is predicted that the industry’s projected total income range will reach
$40 to $55 Billion by 2020 and will further increase employment in the coming years.

Without question, the BPO industry plays a major role in the Philippine economy by
providing a sustainable employment to millions of Filipinos. While we have a promising future
for the BPO industry, 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 bill is meant to rectify this omission, and bring Philippine laws up to date with
regard to this vital new industry.

PERITO M. PICO
Representatlve, DIWA Party-list

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

SEVENTEENTH CONGRESS
Third Regular Session
8578

House Bill No.

Introduced by DIWA Party-list Representative Pepito M. Pico

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. - It 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 service-
type business processes to a third-party service provider. It is generally divided
into the 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-
hour work cycle.

b) “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.

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c) “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.

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

e) “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.

g) “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 Illness” 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.

1) “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.

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

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

t) “Authorized 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

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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 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

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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 shall 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, 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

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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 shall 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.

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

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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
unconstitulional, 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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