Gaps in the ILO -DOLE decent work programming

January 24, 2019

AER-Industrial Policy Team

By Rene Ofreneo – January 24, 2019

The  Manila  Office  of the  International  Labor  Organization  (ILO)  and the  Department of Labor and  Employment (DOLE) have  drafted  a Decent  Work Country  Program (DWCP) for  2018-2024.  The  overall thrust  of  the  DWCP is to promote  full and  productive decent work for  all Filipinos. The term “decent  work” has been  defined by ILO as  work obtained  in conditions  of freedom, dignity, equality and  security. 

The  ILO’s Decent Work Agenda  was launched in 1999-2000 by then ILO Director-General Juan  Somavia.  It was  partly  a response  to the  rising tide  of labor  anger against the  excesses of  neo-liberal globalization.  A vivid expression of this  anger  was  the riotous collapse of the 1999  Ministerial  Conference of the  World Trade  Organization  (WTO) in Seattle.  Trade  unions, civil society organizations and governments  of  a number  of developing countries  opposed  to  imbalances under global free trade shut down the Seattle Ministerial and the  succeeding  WTO   Ministerial  Conferences (in 2003 in  Cancun, in 2005 in  Hong Kong,  etc.).  

The  goals  of  the  DWCP are laudable  — creation of jobs for  all workers, guarantees  in the  exercise  by all workers  of  their  rights, extension of social protection  to all  workers, and productive social dialogue  for the  benefit of all  workers.  As the authors  of  the  DWCP  put it, the appropriate development  approach in achieving the  foregoing is  through  the  adoption of the  whole-of-government or  whole-of-society approach.  Inclusive.  Walang maiiwan at  walang makakaligtaan.

The  problem  is  how  to translate the  foregoing into  reality.  A  perusal of the draft  DWCP  and  the  accompanying  draft priority matrices indicates  that there are gaps, serious gaps in the decent work programming undertaken  by DOLE and  the  ILO Manila Office.

First, the  DWCP is  overwhelmingly focused  on the  traditional target of the DOLE  work program: the  paid  workers in the  narrow  formal labor market. The large  informal  economy or sector, which accounts for  at  least  two-thirds  of  the  labor force per estimate  by the Employers  Confederation  of the Philippines,  is  given  only marginal  attention.  For example, there is hardly  any  discussion  on the recognition of the  rights  of  informal sector workers’ associations,  such  as  those  formed  by transport workers, vendors, fisherfolk, farmers, home-based  workers and  so on and  so forth.  Where is the whole-of-government or whole-of-society approach to development?

One  ready explanation  for  the  failure  of  the  DWCP authors to consider the situation of  the informal sector is  the  well-entrenched system of  tripartism in industrial relations and in the  ILO  system itself.  As a  backgrounder,  tripartism is a product of  the 2nd  Industrial Revolution.  The ILO founders then imagined that the then emerging industrial  society  based  on  mass  production would be represented  by only three major social partners – government, industrial  employers and organized industrial workers.  However, the world of  work has not  developed  this way. Instead, what we see is  the  uneven and segmented development of  the economy and labor market in almost  all countries.  Thus,  western  scholars  are  now  talking of  “varieties of  capitalism” and “varieties  of  trade unionism”.

In  the Philippines,  we  have the formal/informal divide in the  labor market, with each sector divided further into so many distinct segments.  The  2017  ILO  Diagnostics  on  Decent  Work in the  Philippines  is quite telling:   just  a  little  over 200,000 workers,  out  of  a  labor  force of 42 million to 43 million in 2016, were  covered by collective bargaining  agreements.  Hence, large segments of  the  formal labor market are invisible  in the  tripartite system.  More  so the workers  in the  huge  informal labor  market.  Many employers, mostly those  belonging to the  MSME  galaxy (99.6 percent of  the registered enterprises), are also not  represented in the  tripartite system.

However, DOLE  and  ILO need not  abandon or set aside tripartism to  be  able to reach out to the  formal  and  informal  sectors of  the  labor  market  and all major segments of  the labor force  under each sector.  What  is needed is  to set up new  institutions  or  mechanisms of consultation,   dialogue and  representation  that  will allow  workers  in  all these  sectors and  segments  of the labor force to have a  voice.  A system  of  multi-partism is clearly in order. 

In this  regard,  the  DWCP authors should  have looked  into the proposed  Magna Carta for Workers in  the Informal Economy (MACWIE), a bill pending in  Congress.  It provides, among  other things, for a system of  recognizing  the  rights  of  informal workers and a  system of registering informal worker associations.  The  Philippines should also learn from  India, which  has recognized  the rights of  women in the informal economy  to associate and  has  allowed  them  to register their organizations  as unions.  Thus, the biggest unions in India today are non-factory associations such as the Self-Employed Women Association  (SEWA) based in Ahmedabad. The International Trade Union Confederation  (ITUC) has  now recognized these  associations of  home-based  workers,  street vendors, non-corporate construction workers, and waste recyclers  as unions.

As to labor market governance in the  formal  sector, the system of representation and  social dialogue can be improved, broadened and deepened.  First, in the  case of the public sector, it is about time  that an enabling law on public sector industrial relations be enacted.  Unionism and collective negotiations in  the public sector are relatively ineffective because there are no enabling  laws, especially on  grievance and  dispute  settlement.  Second, there should be a system of recognizing  the rights of non-regular workers to form associations and bargain.  The non-regulars, including  the “endos” and the numerous agency and  project workers, easily  outnumber the  regulars.  In Japan,  they now have unions of dispatched and  part-time workers.

Thirdly, there is a provision in the Labor Code, which  states that “workers shall have the right…to participate  in  policy and  decision-making processes of  the establishment where they are employed insofar as said  processes will directly affect their rights, benefits, and  welfare.” (paragraph 2, Article 255 [renumbered  as Article  267]).  In short,  all major  establishments,  unionized  or  not, are  mandated to develop a system of employee consultation in  the formulation  of  personnel policies. To make this provision work, the  DOLE  secretary can issue the needed  rules and  regulations, as indicated in the said  Article.  But what  will prevent the  DWCP authors  from pointing this out in the draft program and even  suggesting an enabling law?

There are also some  points raised in  the DWCP, which need  to be fleshed  out or clarified.  For example, job creation is often equated to increased  participation in the global  value chains (GVCs).  Is this really  the way forward to job creation?  Are  GVCs, including the offshored business processes, not in danger of shrinking  under the  Fourth Industrial Revolution due  to the rise  of the  robots, artificial intelligence  and other technological  advances?  Are the DWCP authors  aware that labor market analysts are now discussing the phenomenon of “re-shoring”, meaning outsourced  industrial  facilities being brought back by the  multinationals  to  their home  countries because the technology revolution  is making global outsourcing superfluous?  Thus, by  2024,  it is possible that the country might even see less, not  more, GVC jobs.

On another  front, the  DWCP  hails  the jobs  creation potential  of the  build-build-build (BBB) infrastructure program with its  trillion-peso budget.  But should the  BBB program not  be   subjected  to the parameters of  decent work standards?  For  example, are there guarantees  that BBB construction  workers shall be given  decent  wages and decent work conditions?  Will there be BBB projects for the urban poor and  rural poor communities?  And  yes, are  we building infras mainly  for the  benefit of the  rich and  developed  communities?  If so, how  will Philippine  society  look like in 2024 or in 2030 or  in 2040, when the country is  supposed  to become  a developed middle-class economy?

Finally, to make  jobs  decent for as  many, if  not all, Filipino workers, the government should  also pay attention  to urgent social and  economic reforms such as  agrarian  reform, aquatic reform, housing reform, education reform and so on. These  socio-economic reforms  are  most  needed in the  informal  economy to  make  jobs and  livelihoods decent and sustainable. Again, discussion of  these  reforms in the DWCP is minimal. 

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