Philippine President Rodrigo Duterte has vetoed a measure that would have ended companies’ practice of hiring workers on short-term contracts, breaking a campaign promise.
Philippine law allows firms to hire workers to meet demand at peak times by using five-month contracts, to avoid a six-month rule that requires permanent job status alongside health and other benefits.
Duterte, 74, ran for election in 2016 on an anti-elite agenda, vowing to end the practice where firms terminate contracts every five months to avoid paying staff the same as regular employees.
“Security Tenure Bill vetoed by the president,” presidential spokesman Salvador Panelo announced. Duterte had called the bill urgent in September.
He said the president would pursue his campaign pledge but urged Congress to pass a law favourable to both staff and businesses.
The bill was due to become law today (Saturday). To override a presidential veto requires a two-thirds vote in each house of Congress.
Trade unions said Duterte risked losing his working-class supporters.
Duterte remains popular midway through his six-year term, with Manila-based pollster Pulse Asia reporting in June that he had an approval rating of 85 per cent.
“It really hurts us because this is the president’s campaign promise,” said Alan Tanjusay of the Associated Labour Unions-Trade Union Congress of the Philippines, the country’s largest union.
“‘He said, ‘I need a law to address contractualisation’, and now that there is a law, he vetoed the bill’,” Tanjusay told the media.
Workers’ “hope and aspirations for higher-paying jobs are shut by Mr Duterte himself”, Tanjusay added.
“He risks hurting his mass base. We can strongly say these workers are the diehard Duterte believers who believed their lives would change under his presidency.”
Both houses had overwhelmingly approved the legislation, despite warnings by employers that it could harm the Philippine economy.
Lobby groups said it would raise business costs, limit the numbers hired and scare off foreign investors.
Foreign direct investment of US$9.8 billion into the Philippines last year was tiny compared with the sums sent to Thailand and Indonesia. Manila hoped to cut red tape and overhaul infrastructure to increase foreign interest.
“The passage of the bill could have a negative impact to the Philippine economy and to the workers whom the bill aims to protect,” business representatives, including foreign business chambers, said in a joint statement.
“The bill impinges on management prerogatives anchored on the constitution, and it excludes contract workers hired by government agencies,” they added.
The Philippines is looking to boost foreign investment. Picture credit: Wikimedia
