Endo.du30

ENDO
by Alfredo Primicias III
1 | P a g e
In partial fulfillment of PA 208- Prof. Alicia Celestino
Thursdays 530pm| University of the Philippines| NCPAG
1st
Semester 2018- 2019
Table of Contents
Table of Contents .................................................................................................................................1
INTRODUCTION.....................................................................................................................................2
ENDO.....................................................................................................................................................4
IMPORTANCE OF WORK........................................................................................................................4
SECURITY OF TENURE............................................................................................................................5
GLOBALIZATION....................................................................................................................................6
FOCUS ON PUBLIC SERVICE...................................................................................................................6
CONCLUSION.........................................................................................................................................7
References................................................................................................................................................8
APPENDIXES..............................................................................................................................................9
Executive Order No. 51, May 2018 ......................................................................................................9
DOLE DO No. 174..................................................................................................................................9
Permissible Contracting or Subcontracting arrangements:................................................................9
Effect of Violation of the Provisions on the Rights of Contractor’s Employees...............................10
PH Labor Code Article 280 defines regular employment:...............................................................10

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INTRODUCTION
“The simple definition of the jobs issue is lack of job opportunities. A more nuanced view is the inability of the
common person to earn a decent living through productive employment or self- employment. The job issue has many
dimensions. For the nonpoor, unemployment for them is about investing time and money in job search. It is looking
or waiting for a job that best fits their ambitions, skills and temperament. Viewed this way, the job challenge is a
middle- class issue. For the poor, however, jobs are about survival. Unlike the middle class, the poor cannot afford
to be unemployed for long periods. That is why the poor and those with low levels of education have relatively low
rates of employment. What matters for them is how to earn more from time spent on work.”
De Dios, N and Dinglasan, K. 2014.
Just how good is unemployment as measure of welfare?
A Policy Note. UPSE Discussion Paper No. 2014- 01. Diliman: University of the Philippines School of Economics
As an Industrial Relations advocate1, this reporter has a personal conviction in ending contractualization.
Therefore, when presidential nominee Rodrigo Duterte made this as one of his electoral promises, this
reporter never hesitated to be a believer. Indeed, the proper time has come to end the suffering of our
sisters and brothers in the labor front.
Lately, President Duterte has hugged national news once more as he pronounced, “I am asking Congress
to pass legislation ending the practice of contractualization once and for all. As I would like to do the
impossible, that power is not vested upon me by the Constitution and neither will I make both ends meet
even if I violate the laws to achieve that purpose. It's not part of my territory.”2 Through this end, the DOLE3
has directed companies like PLDT4 and Jollibee5 to regularize thousands of workers.
Digging deeper into this social, economic and political paradigm, several reforms through executive and
department orders have been declared to rationalize full implementation, yet it seems to be insufficient to
enforce total ban on illegal contractualization, “Read my lips, I understand that this does not satisfy all
sectors. I share their sentiment; I truly do.”6
Still, the President claims that the campaign has led to the regularization of more than 300,000 workers.
But what is ENDO?7
Initially referred to the practice of hiring workers for 5-5-5 or three consecutive employment cycles of five
months each, which escapes becoming regular employees that consequently results to not being covered
by labor standards on minimum wage, statutory benefits and the constitutional right to unionize, among
others.
The IBON Foundation has precisely described this as "the prevalence of jobs that are insecure, low-paying,
and lacking in benefits."8
1
Class 2018, Master in Industrial Relations major in Human Resources Management. UP- School of Labor and
Industrial Relations, Diliman.
2
https://news.abs-cbn.com/business/07/23/18/once-and-for-all-end-contractualization-duterte-tells-congress
3
Department of Labor and Employment
4
Philippine Long Distance Telephone
5
Leading QSR- quick service restaurant, 100% Filipino
6
https://www.philstar.com/headlines/2018/07/24/1836355/duterte-calls-congress-end-labor-contractualization#Wb6de3iriRIif6Uw.99
7
End of Contractualization
8
https://www.philstar.com/headlines/2018/07/24/1836355/duterte-calls-congress-end-labor-contractualization

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Taken from CNN Philippines, below is a brief narration of the Presidential promise, and the actions made
to realize its fruition:9
1. Labor Secretary Silvestre Bello III later clarified that what Duterte meant by terminating
contractualization was -- "No more unlawful, illegitimate contractualization."
2. April 2016: Presidential candidates promise to end labor contractualization but Duterte's pitch
during an April 24 debate stands out, as he says he can do it in a week. "I will talk to the House
Speaker and the Senate President... I will talk to the majority: You need to pass this bill immediately.
I need it first week of my administration," Duterte says.
3. May 2016: Duterte, who promised "genuine change" and campaigned on a hardline anti-crime,
anti-drug platform, wins the May 9 presidential polls.
4. June 2016: Duterte takes his oath as the 16th President of the Philippines. It marks the start of
labor groups' call for him to make good on his campaign promise to end "endo."
5. July 2016: The President delivers his 1st State of the Nation Address or SONA, does not mention
ending contractualization.
6. August 2016: Duterte reiterates the call for an end to contractualization, even threatening to close
companies who refuse to stop the practice.
7. On his 100th day in office: Duterte's promise to eradicate "endo" seems far-fetched, labor groups
protest. They slam the Labor Department's draft order on contractualization, saying it does not
prohibit all forms of contractualization. The draft Department Order 168 requires a higher capital
for agencies hiring contractual workers and will fine those who violate its provisions.
8. March 2017: Some labor leaders walk out of a meeting with Labor officials and employer groups,
angry at the final draft of the department order. It mandates manpower agencies, instead of the
principal employers, to regularize workers, and allows contractualization for seasonal and project-
based jobs.
9. March 2017: Bello signs Department Order 174, the much-awaited rules on contractualization. The
order bans labor-only contracting, outsourcing work due to a strike, and "555" or "endo." Labor
groups stage nationwide protests, arguing that the order actually favors employers and allows
manpower agencies to reabsorb workers if employers do not regularize them. Employers warn the
order may result in thousands of job cuts across industries.
10. July 2017: Bello admits his department has failed to end contractualization within the
administration's first year in office, pointing out the lack of manpower to do so. "We've failed to
regularize the contractual as much as we wanted to," Bello says.
11. February 2018: Duterte has promised to sign an EO banning illegal forms of contractualization by
March, Bello says. In a February 26 speech, however, Duterte seeks a compromise saying he
cannot force "capitalists" to end contractualization. "Don't make it hard for them to run the business
the way they like it because that's their money.
12. April 2018: The administration announces the President is no longer signing any Executive Order
but leaves the contractualization issue to Congress.
13. May 2018: Duterte announced he has signed the executive order banning illegal contractualization.
The order bans contracting and sub-contracting.
9
Santos, E. Ending 'endo': How's Duterte's campaign promise? CNN Philippines, 24 April 2018.
http://cnnphilippines.com/news/2018/04/24/president-rodrigo-duterte-dole-endo-contractualization-kmu.html

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In retrospection10:
1. To implement the Department of Labor and Employment’s Department Order 18- A was issued in
2011. This covered all private companies who are engaged in contracting or subcontracting. This
specifically mandates all third-party service providers to
a. fully comply with minimum wages and general labor standards
b. payment of social security premiums
c. security of tenure
d. self- organization
e. enter and participate in a collective bargaining agreement
f. right to strike
2. Department Order 174 was signed in March 2017 and superseded DO 18- A. This new Department
Order defines the scope of permissible and non- permissible contracting and subcontracting. The
law states that
a. contracting or subcontracting is legitimate if the contractor is registered with DOLE
b. engaged in an independent business
c. free from control of the principal company
d. has substantial capital and or investment (not engaged in labor- only contracting which
singularly means that labor- only contracting is illegal)
ENDO
The defeat of several presidential aspirants (Roxas, Poe, etc.) may have not seen it coming when the very
nerve of the proletariats helped President Duterte win the race. Henceforth, labor leaders and their political
allies pushed for an immediate end to employment “contractualization,” a popular reformist policy. “The
idea is for the government to tighten and reduce, if not prohibit, the use of temporary employment contracts
(or TEC) and job outsourcing.”11
Why is there a strong political demand to end contractualization and outlaw all forms of TECs?
Despite positive trends on various economic factors, poverty persisted which led a popular perception that
employers largely profited from the rapid economic growth leaving the workers to scarcer resources and
livelihood opportunities. Therefore, by ending contractualization, advocates believe that the laborer’s
economic situation would improve. “TECs are portrayed as a cause of workers’ hardships and
exploitation.”12
IMPORTANCE OF WORK
When you have a constitution that pictures labor as the primary social economic force. Also, if you have a
state that protects labor and cares for it as the human component of production, and partner with capital
resulting to a fruitful social and economic relationship (Benedicto, 2007), then employment becomes a
critical key to nation building.
But how about those who are destitute among us, are jobs about survival?
10
Page 162. Tolentino M. Contractualization: Will it ever end? Philippine Journal of Labor and Industrial Relations.
Vol 35, 2018. University of the Philippines- School of Labor and Industrial Relations.
11
page 71, Ch. 5, Paqueo V. and Orbeta, A Beware of the “End of Contractualization!” Battle Cry. Unintended
Consequences: The Folly of Uncritical Thinking.
12
Ibid.

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The poor cannot afford to be unemployed. Workers who are vulnerable and precarious brought by illiteracy,
poor health and unfair distribution of opportunities rely on informal economy only when competition in the
formal economy makes earning and living a tough pursuit (De Dios, 2014). No wonder that the importance
of jobs has always been the central mission of the ILO13 led by Prof. Ranis of Yale University in the 1960s.
Yet, despite of our country’s accelerated economic growth14, the phrase “jobless growth” has become a
popular term to denote economic growth without decreasing poverty level, unemployment and
underemployment (Paqueo, 2014).
SECURITY OF TENURE
This puzzle has always been a furious debate among radical and moderate thinkers. On one hand, you
have a crystal clear constitutional mandate ensuring security of tenure for workers which no less than the
frameworks of the Labor Code breathe this statutory right. Then on the other hand the powerful entitlement
of capitalists to have management prerogative.
It was only during the 1987 Philippine Constitution that workers in private employment began to be covered
by the security of tenure (Bacungan, 1976):
The State shall afford protection to labor, promote full employment and equality in employment, ensure
equal work opportunities regardless of sex, race or creed, and regulate the relations between workers and
employers. The State shall assure rights of workers to self- organization, collective bargaining, security of
tenure, and just and humane conditions of work. The State may provide for compulsory arbitration.15
The argument is fundamentally anchored on how competitive the nation is as compared to other countries16:
1. Out of 144 countries, the Philippines ranks 91 on the LME (labor market efficiency) scale.
2. The Philippines has relatively low scores in
a. hiring and firing- 3.4 on a scale of 1- 7
b. redundancy costs (weeks of salary)
c. flexibility in wage determination- 4.8 on a scale of 1- 7
3. The PH appears costly relative to labor average productivity: 0.69 compared to SG’s 0.23,
Malaysia’s 0.37 and China’s 0.33
We Filipinos are placed in a competitive disadvantage when parameters on labor cost and flexibility on
labor regulations and standards are considered. The current labor market is characterized by inefficiency
due to costly and inflexible regulatory environment. This is unfavorable to economic efficiency,
competitiveness and jobs- generating growth (Paqueo).
Fluctuating business cycles and unstable global markets on products and services force investors and
capitalists to look for reasonable alternatives to cut down on labor cost, and TECs have become an efficient
mechanism to realize this in the complicated web of the value chain.
13
International Labor Organization
14
In 2010, the BPO industry reached the US9B revenue target and employed about 530,000 full-time employees.
From 2004 to 2009, the average shares of tourism in GDP and in total employment were 6.12% and 9.68%
respectively.
Source: Page 158. Tolentino M. Contractualization: Will it ever end? PH Journal of Labor and IR. Vol 35, 2018. UP-
SOLAIR.
15
Section 9, Article II, New Constitution
16
Page 78, Ch. 5. Paqueo V. and Orbeta, A. Beware of the “End of Contractualization!” Battle Cry. Unintended
Consequences: The Folly of Uncritical Thinking.

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GLOBALIZATION
With a history of having a social order that is fragmented, comes the fiercest phenomenon prevalent today
that further pulls industrial peace between capitalists and workers down to decay— globalization. The
country’s forcable entry to free trade liberal market had left the nation unprepared and ill equipped to face
the challenges of unanticipated effects. The Philippine Labor Code and labor standards were not designed
to cope with the enormous effects both to the business and labor sectors. Labor, that used to be the
protected sector of society and one of the partners of economy, continue to suffer the most (Bello, 2011).
As a result, globalization drives the force toward more flexibility at work. Faced with intense competition,
higher revenue targets and maximizing production capabilities consequently have made firms create
measures to transform structures on technology, machines, costs and labor.
Protectors of decent work refute flexible work arrangements, particularly contractualization since this “has
degraded the growth of trade unions and consequently derailed the avenues of representation for workers
and that such business strategies are opposed to guarantees of security of tenure for workers.”17 Moreover,
due to high unemployment rate, the effects have been18:
1. unskilled workers (women and youth) are vulnerable to accept lower than minimum wages
2. rampant violations of employment agreement and statutory benefits
3. frequent displacement without due process
in the realm of agriculture, another brutal reality that has caused panic due to globalization and market
liberalization is the worsening shortage of rice which is our staple food. As an agricultural country, the
business of food production is in total in shambles19:
1. Employment in the sector continues to decline.
2. There’s a full- blown crisis in the production, importation and distribution of rice aggravated by the
government’s policy of agricultural deregulation.
3. Local industries are barely surviving due to trade liberalization.
4. Social inequality is spreading across regions and social strata. There is a huge gap between
domestic and export industries; between industries, and between cities and rural areas.
5. There is “enclave growth” as a product of export industries located in enclave industrial zones.
Indeed, the growing prosperity of an elite few and a sprouting middle class have shattered all economic
and social gains, if any, from globalization. Instead it has added poverty and misery to the masses
(Ofreneo, 1995). In a globalized and liberalized world, markets and industries are wrapped to survive rapid
changes causing tumultuous shifts on policies, procedures and systems affecting the entire network of
business and labor. In the face of economic changes and adjustments borne by globalization, can workers
still rely on traditional methods and avenues of representation and collective action (Bitonio)?
FOCUS ON PUBLIC SERVICE
Little focus has been directed on the national government when in fact one third of its workforce are holding
informal jobs (Cabegin, 2018). Several government units (i.e. National Government Agencies, Local
Government Units, Government Owned or Controlled Corporations, Government Financial Institutions,
State Universities and Colleges) have “gravely abused their prerogative powers in hiring job order or
contract of service workers that is in violation of Civil Service rules and regulations (e.g. 2002 Civil Service
Commission Resolution No. 020790: Policy Guidelines for Contract of Service).”20 The practice on hiring
17
page 1, Bello B. The Rising Incidence of Contractualization: Threat to Security of Tenure, UP NCPAG, 31 March
2011.
18
Ibid.
19
page 7, Ofreneo, R. Globalization and the Filipino Working Masses. Nationalist Studies, 1995.
20
page 56. Cabegin, E. Incidence and Micro- Determinants of Informal Employment in the Philippines. Philippine
Journal of Labor and Industrial Relations. Vol 35, 2018. UP- SOLAIR.

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non- elective and non- political appointed positions has resorted to offer lower monetary benefits compared
to market and delegation of regular functions to agency employees, which entirely circumvent the law. Due
to this considerable abuse, the Civil Service Commission, the Commission on Audit and the Department of
Budget and Management issued the joint circular no 1-2017 that describes the rules and regulations
governing contract of service workers and job order workers in government.
CONCLUSION
The need to protect welfare of workers (public or private) is an enshrined human right. The resulting effects
will enhance positive social value, foster constructive family interests and develop communities. Protecting
the rights of workers also creates incentives to learn more firm- specific skills that ensures higher industry
participation and productivity. Indeed, the welfare of workers, especially the poor, the illiterate to less
educated, the young and women must be held on a pedestal so that the nation can truly claim that Change
Has Come!
These 12- Point Job Program by the Jobs Expansion and Development Initiative will somehow provide
more avenues to protect the rights of workers21:
1. Simplifying labor dispute resolution processes to cut the time, cost, inconvenience and uncertainty
involved;
2. Making the rules on hiring and firing decisions more flexible, leaving the firms and workers to
negotiate and work out agreements that are mutually beneficial;
3. Instituting measures that will minimize the imposition of labor regulations and practices detrimental
to and discriminatory against the poor and other disadvantaged populations;
4. Allowing firms to hire low- skilled and poor workers who want to voluntarily opt out of the mandatory
minimum wage norm, recognizing that it hurts rather than helps them;
5. Experimenting with a Singaporean style policy- providing limited grants to targeted ultrapoor
workers whose market- determined wages fall far too short of a predetermined social norm on
decent wages;
6. Transforming the consultation process from a tripartite into a quadripartite system that would give
the poor, unemployed, underemployed and self- employed direct representation in the
determination of labor regulations and policies;
7. Encouraging labor unions to focus on raising the competencies and productivity of workers to
achieving decent wages;
8. Lengthening of 2 years from 6 months the compulsory regularization of young workers to expand
their learning experience and build their skills on the job;
9. Ensuring quality implementation of the K- 12 reform; undertaking institutional reform of the
Technical Education and Skills Development Authority as articulated in the 2011 Economic Policy
Monitor of PIDS; and pursuing ongoing Commission on Higher Education initiatives like the United
Student Financial Assistance System for Higher and Technical Education (UNIFAST) aimed at
improving access to quality higher education and production of good research;
10. Implementing the extension of demand- side education assistance of the 4Ps to HS students and
complementing it with policies and programs that facilitate OTJ training and employment in private
enterprises;
11. Promoting research and development activities in support of this proposed 12- point program,
including piloting and testing of innovative approaches; and
12. Facilitating the emergence of well- organized coalition of stakeholders devoted to finding and
promoting approaches that effectively advance the interest of the poor workers now being excluded
from gainful job opportunities.
21
pp 38- 39, Paqueo, V. B. et. al. Labor Policy Analysis for Job Expansion and Development. Discussion Paper Series
No. 2014- 34. PH Institute for Development Studies, July 2014.

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References
ABS- CBN News. 'Once and for all,' end contractualization: Duterte tells Congress, 23 July 2018.
https://news.abs-cbn.com/business/07/23/18/once-and-for-all-end-contractualization-duterte-tells-congress
Bacungan, F. M. Foreword, Blas F. Ople, Secretary, DOLE: The Security of Tenure Law in the Philippines.
UP Law Center, 1976.
Bello, B. C. The Rising Incidence of Contractualization: Threat to Security of Tenure. UP, NCPAG. 31
March 2011.
Benedicto, E. R., et. al. The Changing Nature of Work in Asia: The Philippines. Chandos Pub., Oxford,
2007.
Bitonio, E. Workers Representation Amidst Labor Flexibility: Insight from the Philippine Experience.
Department of Labor and Employment.
Brimon, K. B. Flexibility and Security at work: Seeking a Balance of Interests. Institute of Labor Studies
(ILS), Discussion Paper Series of 05- 201.
Cabegin, E. Incidence and Micro- Determinants of Informal Employment in the Philippines. Philippine
Journal of Labor and Industrial Relations. Vol 35, 2018. University of the Philippines- School of Labor and
Industrial Relations.
Cinco, M. Contractual workers go on strike. Philippine Daily Inquirer, 25 May 2016.
Dakilla. Statement of Support to PALEA’s Fight Against Contractualization. 1 October 2011.
https://dakilapilipinas.wordpress.com/tag/contractualization/
De Dios, N & Dinglasan, K. Just How Good is Unemployment as Measure of Welfare? A Policy Note.
UPSE Discussion Paper No. 2014- 01. Diliman: University of the Philippines School of Economics.
Lanzona, L. & Paqueo, V. Trading Off Worker Flexibility for Job Security: Missed Opportunities for More
and Better Jobs. Unintended Consequences: The Folly of Uncritical Thinking.
Ofreneo, R. E. Globalization and the Filipino Working Masses. Nationalist Studies, 1995.
Paqueo, V. B. Labor Policy Analysis for Job Expansion and Development. Discussion Paper Series No.
2014- 34. Philippine Institute for Development Studies, July 2014.
Paqueo V. & Orbeta, A. Beware of the “End of Contractualization!” Battle Cry. Unintended Consequences:
The Folly of Uncritical Thinking.
Philippine Constitution. Section XI, Article II.
Ramos, M. & Santos T. Digong: End ‘endo’, or I Kill You. Inquirer.net. 1 October 2016.
http://newsinfo.inquirer.net/803183/digong-end-endo-or-i-kill-you
Romero, A. PhilStar.Com. Duterte calls on Congress to end Labor Contractualization. 24 July 2018.
https://www.philstar.com/headlines/2018/07/24/1836355/duterte-calls-congress-end-labor-contractualization#Wb6de3iriRIif6Uw.99
https://www.philstar.com/headlines/2018/07/24/1836355/duterte-calls-congress-end-labor-contractualization
Santos, E. Ending 'endo': How's Duterte's campaign promise? CNN Philippines, 24 April 2018.

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Sicat, G. Labor Issues in the Philippine Development during Blas Ople’s time. UPSE Discussion Paper
No. 0402, Q.C. University of the Philippines School of Economics.
Tolentino, M. Contractualization: Will it ever end? Philippine Journal of Labor and Industrial Relations. Vol
35, 2018. University of the Philippines- School of Labor and Industrial Relations.
APPENDIXES
Executive Order No. 51, May 2018
IMPLEMENTING ARTICLE 106 of the LABOR CODE of the PH, as amended, TO PROTECT THE RIGHT
TO SECURITY OF TENURE OF ALL WORKERS BASED ON SOCIAL JUSTICE IN THE 1987 PH
CONSTITUTION
Coverage: All parties including cooperative engaged in any contracting or subcontracting arrangement.
Prohibition: Contracting or sub-contracting, when undertaken to circumvent the worker’s right to security of
tenure, self- organization and collective bargaining and peaceful concerted activities pursuant to the 1987
PH Constitution.
Violation of this Act: the principal engaged in any arrangement in violation of this Order shall be considered
the direct employer of the contractor’s or subcontractor’s workers for all purposes.
Source: page 5, Labor Policy Reforms and IR Chronicles, People Management Association of the
Philippines, 2018.
DOLE DO No. 174
ABSOLUTE PROHIBITION AGAINST LABOR- ONLY CONTRACTING
Labor- only contracting refers to an arrangement where:
A.
I. The contractor or subcontractor does not have substantial capital (in case of corporation,
partnerships and cooperatives: paid- up capital stocks/ shares at least Five Million pesos; in the
case of single proprietorship: a net worth of at least Five Million pesos) or
II. The contractor or subcontractor does not have the investment in the form of tools, equipment,
machineries, supervision, work premises, among others; and
III. The contractor’s or subcontractor’s employees recruited, and place are performing activities which
are directly related to the main business operation of the principal;
B. The contractor or subcontractor does not exercise the right ot control over the performance of the work
of the employee.
Philippines, 2018.
Permissible Contracting or Subcontracting arrangements:
1. The contactor or subcontractor is engaged in a distinct and independent business and undertakes
to perform the job or work on its own responsibility, according to its own manner and method;
2. The contractor or subcontractor has substantial capital to carry out the job farmed out by the
principal on his account, manner and method, investment in the form of tools, equipment,
machinery, supervision;
3. In performing the work farmed out, the contractor or subcontractor is free from the control and/ or
direction of the principal in all matters connected with the performance of the work except as to the
result thereto; and

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4. The service agreement assures compliance with all the rights and benefits for all the employees of
the contractor or subcontractor under the labor laws.
Philippines, 2018.
Effect of Violation of the Provisions on the Rights of Contractor’s Employees
The Principal shall be rendered the direct employer of the employees of the contractor or subcontractor.
Employees of the contractor shall be absorbed by the principal as its regular employees.
Solidary Liability. In the vent of violation of any provision of the Labor Code, including the failure to pay
wages, there exist a solidary liability on the part of the principal and the contractor for purposes of enforcing
the provisions of the Labor Code and other social legislation, to the extent of the work performed under the
employment contract.
Philippines, 2018.
PH Labor Code Article 280 defines regular employment:
“as the provision of written agreement to the contrary notwithstanding and regardless of oral agreement of
the parties; employment is categorized as regular where the employee has been engaged to perform
activities which are necessary or desirable in the business of the employer.”
Source: Azucena C. Jr. Everyone’s Labor Code. QC. Rex Printing Co. Inc., 2012.

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