THE FISCAL Incentives Review Board (FIRB) has rejected a request to allow outsourcing companies to implement work-from-home measures based on total revenues, instead of a set percentage of their workforce.
“The Philippine Economic Zone Authority’s (PEZA) proposal is not consistent with the emerging economic strategy of the government to gradually and safely reopen the economy,” Finance Assistant Secretary Juvy C. Danofrata said in a Viber message on Wednesday.
She said FIRB members think the resolution the board had issued is “a reasonable one considering that activities registered with PEZA or any other economic zones should actually be conducted within their ecozones.”
The FIRB last month released guidelines that would continue to allow business process outsourcing (BPO) companies in economic zones to extend their work-from-home (WFH) arrangements until March 2022.
Under the guidelines, outsourcing firms are allowed to have most of their workforce at home until March 2022, but they must have 10% of their employees on site.
This revises a work-from-home setup that would have ended last month, when the national state of calamity was originally scheduled to end. President Rodrigo R. Duterte extended the state of calamity until September 2022.
Under the old rules, PEZA-registered BPO companies could have work-from-home operations to the extent of “up to 90% of their total revenues.”
PEZA had sent letters asking FIRB co-chairmen Finance Secretary Carlos G. Dominguez III and Trade Secretary Ramon M. Lopez to retain the previous guidelines.
PEZA Director-General Charito B. Plaza said the new rules requiring part of the workforce to report to the ecozones could cause problems because many employees are still wary about reporting to the o
ce amid a surge in COVID-19 cases.
The new rules, she said, would “defeat the purpose of the extension of the work-from-home arrangement which is to limit the mobility of workers and lessen the pressure on public transport.”
Ms. Plaza did not immediately reply to a Viber message seeking comment.
Meanwhile, an official of the Information Technology and Business Process Association of the Philippines (IBPAP) is proposing legislation to support hybrid work arrangements in the industry.
“A continuation of this policy is important to us. This may not be the right ratios. There should be an agreement between the industry and the government as to what the best balance is,” Celeste B. Ilagan, IBPAP Board Trustee, said at a virtual briefing on Wednesday.
“The legislation that will institutionalize the Philippines’ response to this global working trend is necessary. It can be done with an amendment to a certain portion of Republic Act (RA) No. 11534 or the Corporate Recovery and Tax Incentives for Enterprises Act that will allow us to be able to freely and liberally work from home and continue to enjoy our perks as exporters,” she added.
Ms. Ilagan also cited RA No. 11165 or the Telecommuting Act as a law that could be amended to help the industry.
“It has been there even before the (COVID-19) pandemic. At that time, employers had not adjusted to the thought of a lot of employees working from home. The pandemic proved that it can be implemented well and safeguards can be put into place,” she said.
“There are existing laws that can be amended to specifically address the work-from-home vision of the industry for the long term, not just during the pandemic,” she added.
IBPAP Chairman Benedict C. Hernandez said the industry is “cautiously optimistic” about its target of hitting 1.43 million full-time employees and revenues worth $28.8 billion this year.
“We must keep in mind that for this to become a reality, the sector needs to redesign the future through our key strategic imperatives on digitalization, talent, policy shaping, country marketing and infrastructure,” he said.
The IBPAP is set to hold its 13
International Innovation Summit (IIS) on Nov. 16, 17, 18, 23 and 24, which will talk about how the sector is forming new points of contact in a world driven by change and connected from multiple global locations. The summit also aims to solidify the country’s position as a top investment destination for IT-BPM services. —
Jenina P. Ibañez
Revin Mikhael D. Ochave