Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

‘SEVENTEENTH CONGRESS
First Regular Session

5728

HOUSE BILL NO.

oo

INTRODUCED BY REPRESENTATIVE ALFRED VARGAS

—

EXPLANATORY NOTE

The Philippines has established itself as the preferred location for information technology
and business process outsourcing (IT-BPO) services due to the Filipinos’ competitive advantage in
language skills and cultural affinity. The country is now the number one IT-BPO industry in the
world, surpassing India in 2010. The Philippine IT-BPO industry currently employs 1.2 million
People and is the second largest source of income for the country’s economy.

However, contact centers in the country are posting a high attrition rate of almost 50% per
Year. According to the Contact Center Association of the Philippines and International Labor
Organization, IT-BPO agents cite the nature of night-shift work as the primary cause why ‘many IT-
PO workers leave the industry. Moreover, this particular peculiarity of the BPO industry is also
linked to the health and occupational safety concerns of the IT-BPO workers, such as, but not
limited to, sleep disorders, fatigue, eye strain, voice and hearing problems, and Psychological stress,
‘These issues must be addressed to uplift the welfare and morale of the IT-BPO workers which will,
in turn, ensure the continuous growth of the IT-BPO industry in the Philippines.

This bill seeks to protect the labor rights and welfare of the greatest asset of the IT-BPO
industry ~ its workers. It consists of two parts. The first part enumerates the general employment
Standards in the IT-BPO industry. Among the rights and benefits accorded to the IT-BPO employees
include, but not limited to the protection from understaffing and overloading mandatory
reBularization, right to self-association, freedom from excessive company bond, and security of
entre. The second part seeks to promote occupational health and safety in the BPO industry which
includes the formulation of occupational health and safety (OHS) standards and creating OHS
representatives in the workplace that will monitor the health conditions in the office.

To ensure that the Philippines and its people can fully reap and enjoy the economic benefits
siven by the IT-BPO sector, the passage of this bill is earnestly sought.


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS

First Regular Session

INTRODUCED BY REPRESENTATIVE ALFRED VARGAS

ENSURING THE RIGHTS, WELFARE AND SAFETY OF THE WORKERS IN THE INFORMATION
TECHNOLOGY AND BUSINESS PROCESS OUTSOURCING (IT-BPO) INDUSTRY IN THE
PHILIPPINES

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

SECTION 1. Short Title. - This Act shall be known as the “IT-BPO Workers’ Rights, Welfare
and Safety Act’.

SECTION 2.Declaration of Policy.-Itis the policy of the State to protect the rights, and
Err BPO) welfare of workers in the Information Technology and Business Procexs Outsourcing
{(T-BPO) industry. The State shall strive to promote and enharce the working conditions, terms of
employment, professional growth and career development of employees,

SECTION 3.Coverage. - This Act shall cover all employees in the IT-BPO industry,

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

a) “Information Technology and Business Process Outsourcing” (IT-BPO) describes
the whole outsourcing industry in the Philippines. is the delegation of one or

5) “Call Center” refers to a centralized office for receiving and transmitting
eduests by telephone or Internet. Call center operations include, but are nee
limited to, the granting of incoming product support, information inquiries from
ceo nrgrs: and outgoing calls for telemarketing, clientele, product services, and
debt collection,

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


@ “Employee” shall refer to any person employed by an employer in a
temporary/probationary or permanent capacity.

©) “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
Sr employment, which substantially comply with the prescribed Standards, as
defined below.

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

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

i) “Workplace” means the office,

') “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.

n) “Department” shall mean the Department of Labor and Employment.
©) “Secretary” shall mean the Secretary of Labor and Employment.
P) “Bureau” shall mean the Bureau of Working Conditions,

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


") “Standards” shall mean the Occupational Safety and Health Standards and
regulations, as described in Section 19,

5) “Enforcement Officer” shall mean the industrial safety engineer, the labor
regulation officer, or any duly authorized representatives of the Secretary to
enforce the Standards.

‘) “Authorized Representative” shall mean and include any employees or official of
pther government agencies empowered by the Secretary of Labs and
Employment to enforce the provisions of the Standards,

4) “Workplace Occupational Health and Safety Representative” (WOHSR) is defined
in Section 22 of this Act.

¥) “Registered Interested Party” shall mean any duly registered non-stock non-
rofit organization advocating occupational health and safety (Oks).

) ‘Shift Work” shall mean the employment practice designed to make use of the
FA hours of the day. Employees are given schedules which correspond tos a,
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 6.Access to Relevant Information. -It is the duty of IT-BPO companies to ensure
that their employees have access to relevant information to equip them with the knowledge with
regard to their rights, welfare and condition. IT-BPO employees must nor re restrained from
Organizing or attending activities, such as, but not limited to workshops, seminars, and the like.

SECTION 7. Protection from Understaffing or Overloading. - There shall be no
understaffing or overloading of IT-BPO employees. Companies must mer overwork the employee
and or over-extend his services beyond what is specified in the employment contract.

SECTION 9. Right to Self-Association. -It shall be unlawful for any person or company to
restrict the rights of IT-BPO employees to self-organization, collective bargaining and negotiations,
and participate in policy and decision-making processes affecting their rights and benefits.



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

SECTION 12. Hours of Work. - The hours of work for IT-BPO employees shall be governed
by the provision of the Code, as supplemented by other applicable lane as well as this Act.

SECTION 13. Overtime Work. - IT-BPO employees may be required to render services
beyond their required working hours in cases provided for in the Code; Provided, that the employee
is paid for the overtime work with an additional compensation equivalent to not less than his

SECTION 14. Night Shift Differential. - 1T-BPO employees shall be paid a night shift
differential of not less than ten percent (10%) of their regular wage for each hour of work
Performed between nine o'clock in the evening and six o'clock in the morning.

SECTION 15. Work on Holidays. - IT-BPO employees may be required to work on days
Gesignated 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 18. Employers Obligation - Article 106 of the Code expressly prohibits “labor
pnly” contracting. Employers engaging independent contractors to perform work on their behalf
have a duty to minimize the health and safety risk of the contractors employees. This is because
they are deemed to be employees for the purposes of the Code, as well this Act, and because
employers have a duty to protect third parties at or near their workplace. A failure to maintain a

SECTION 19. Occupational Health and Safety Standards and Regulations for IT-BPO
Employees. - Pursuant to its mandate, the Department of Labor and Employment is tasked to
¢stablish Occupational Health and Safety Standards for IT-BPO work. The Standards shall adhere to
ine Prevailing standards of health and safety for IT-BPO work and ethan similar employment.
Minimum provisions in the Standards must be in agreement with the recommendations of the
International Labor Organization's recommendations.


SECTION 20. The Nature of IT-BPO Night-Shift Work. - Establishments engaged in shift
work to complete their 24-hour work cycle expose their employees to heal and security risk, as
well as unnatural stresses, and such a night shift work is considered to be hazardous under this Act.

SECTION 23. Workplace Policy on Occupational Health and Safety. - Each establishment
shall formulate their own occupational health and safety (OHS) policy, which adheres at minimum

17 BPO companies shall be responsible in informing their employees about the OHS policy.
‘They shall disseminate informational materials to the employees free of charge.

SECTION 24. Occupational Health Program. - The company Physician shall formulate and
implement a comprehensive occupational health program for the benefit of sil employees.

SECTION 25. Health Insurance. - IT-BPO employees are entitled to free medical
Thay uation upon commencement of employment, and annually during the tenure of employment.
ney shall also be provided with full health insurance, the coverage of which ctuaih be agreed upon
by the employer and its employees,

and their dependents shall also be compensated for injuries, medical complications, illness,
disability and death arising from, and related to, their work in accordance co existing laws, labor
Policies, guidelines or circular as the case may be. The employees compensation commission shall
Promptly process any claims for/by injured, disable deceased employees or their dependents,


SECTION 28. Penal Provision. - Any person or company who violated the provision of this
Act shall be punished with a fine of not less than One Hundred Thousand Pesos (P 100,000) and/or
imprisonment of not less than two (2) months but not more than (1), or both, at the discretion of
the court.

SECTION 29. Separability Clause. - If any provision of this act is declared unconstitutional,
the same shall not affect the validity and effectivity of the other provisions hereof.

SECTION 30. Repealing Clause. - All laws, executive orders, presidential decrees,
Presidential proclamation, rule and regulations or parts thereof inconsistent with the provisions of
this act are hereby repealed or modified accordingly.

SECTION 31. Effectivity Clause - This act shall take effect fifteen (15) days from its
publication in the official gazette or at least two (2) national newspaper of general circulation.

Approved.