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House passes on second reading bill banning ‘endo’

THE House of Representatives on Wednesday approved on second reading a bill banning contractualization in the private sector.

Following a voice vote, the chamber approved House Bill (HB) No. 7036 or the proposed Security of Tenure Act.

HB 7036 seeks to strengthen the security of tenure of private-sector employees by amending Presidential Decree No. 442 or the Labor Code of the Philippines.

The measure prohibits labor-only contracting, while granting the Secretary of Labor, after consultation with the National Tripartite Industrial Peace Council, the right “to make appropriate distinctions” between labor-only contracting and legitimate job contracting.

Under the measure, labor-only contracting exists when the contractor does not have substantial capital or investment in the form of tools, equipment, machinery in the work premises; the contractor has no control over the workers’ methods and means of accomplishing their work; or the contractor’s workers are performing activities which are directly related to the principal business of the employer.

The bill mandates regular employment as a general principle and prohibits “fixed-term employment except in the cases of overseas Filipino workers, workers on probation, (and) relievers who are temporary replacements of absent regular employees.”

The measure also requires the rights and benefits of relievers, project and seasonal employees to be at par with regular employees. All workers must be treated equally and enjoy equal rights and obligations, according to the bill.

The bill also provides for the licensing of job contractors, with corresponding penalties for unlicensed entities.

President Rodrigo R. Duterte in 2019 vetoed an anti-endo measure, saying that it “broadens the scope and definition of prohibited labor-only contracting, effectively proscribing forms of contractualization that are not particularly unfavorable to employees involved.” — Kyle Aristophere T. Atienza

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