End of Endo? Anti-Endo Bill Passes Third Reading in Senate

The Philippines may see the end of contractual employment, more commonly known as "Endo."

Endo, which refers to the end of contract of employment, is a legal loophole sometimes used by companies in order to cut costs. In this practice, workers are terminated before their sixth month of employment, the period required by law for workers to be regularized and start receiving benefits.

Senate Bill 1826, also known as Endo Bill, guarantees workers' security of tenure preventing labor-only contracting.

"We want to give workers peace of mind when it comes to their employment status," said Senator Joel Villanueva in an interview with ABS-CBN.

The Senate's Endo Bill defines labor-only contracting as the supplying, recruiting, and placement of workers of a contractor to a contractee; when workers supplied to a contractee perform tasks or activities that are listed by the industry to be directly related to the core business of the contractee, and where the contractee has direct control and supervision of the workers supplied by the contractor.

Stricter Scrutiny by the Department of Labor and Employment

The Endo Bill also gives sharper teeth to the Department of Labor and Employment or DOLE, which will be given the power to scrutinize companies who apply for license for job contracting.

Under the Endo bill, workers are classified into four types: regular, probationary, project, and seasonal. There would be no more contractual workers, should the bill pass into law. Outsourcing workers will still be legal, but have to pass through industry tripartite councils who will determine what kinds of roles can only be outsourced.

Regular Workers' Benefits

Under current laws, regular employees enjoy the following benefits:

Social Security Coverage

Private companies are required by law to register all regular employees in the Social Security System, which provides retirement and health benefits.

PhilHealth Insurance

Workers for public and private companies shall be enrolled in the Philippine Health Insurance Corporation or PhilHealth, which sets aside contributions for medical insurance.

Membership in the Home Development Mutual Fund or Pag-IBIG

Pag-IBIG is the government agency tasked with providing low-interest housing loans to Filipinos. These loans are payable up to thirty years. All public and private firms are mandated to contribute to the fund in behalf of their regular employees.

13th Month Pay

All rank-and-file employees who have worked for at least one month during the calendar year are entitled to a 13th-month pay equivalent to one-twelfth of their basic annual salary, which they should receive not later than December 24. It is mandatory and is treated as a separate sum from the optional Christmas bonus.

Leaves

Service leaves, vacation leaves, sick leaves, maternity benefits, and other types of paid leaves are enjoyed by regular employees. If Endo Bill becomes law, all contractual employees may be regularized and enjoy these benefits.