DOLE releases new order as first step towards ending ‘endo’

  • DOLE issued a new department order as first step towards ending “endo”
  • The new order suspends new applications for third-party service providers
  • DOLE will now focus on investigating compliance of existing contractors and subcontractors

The Department of Labor and Employment (DOLE) has issued a new department order that would suspend the registration of new labor contractors and subcontractors; effectively becoming the very first step towards ending that practice of “endo” in companies.

DOLE Secretary Silvestre Bello issued Department Order No. 162, s. of 2016, that mandates regional offices to suspend any new applications from third-party service providers and instead allow only the 5,000 to 6,000 contractors and subcontractors which have already been registered with the department.

“All certificates of registration of contractors/subcontractors issued prior to this order shall be respected. Contracts entered into by duly contractors/subcontractors prior to the issuance of this Order shall not be impaired or diminished consistent with the provisions of the Labor Code, the Civil Code, and existing jurisprudence,” Bello ordered in his memorandum, as previously quoted by Tempo.

However, existing third-party service providers can have their licenses revoked should they be found to violate government regulations.

With this new issuance, DOLE can now focus on ensuring whether or not such service providers follow labor laws, as well as cracking down on fly-by-night contractors.

DOLE Undersecretary Joel Maglunsod pointed out that the new rules is in line with the campaign promise of President Rodrigo Duterte to end the practice of “contractualization” among industries.

“If we will accept new applicants, it will contradict the marching orders of the President…now that we are confined with those existing, it will be easier for us in conducting the necessary assessment,” Maglunsod explained to Manila Bulletin.

DOLE targets cutting cases of contractualization by half by the end of the year.

Meanwhile, the organizations of private employers and human resource practitioners, the Employers Confederation of the Philippines (ECOP) and the People Management Association of the Philippines (PMAP) have signed on the joint Labor Law Compliance Code for Employers; expressing support for the new administration’s promise to end the illegal practice of “endo.”