Worse than Malu Fernandez controversy

02/09/08
Posted under Readers' Blog Posts

IF your answer is yes to one or more of the following questions, then this article is for you:

1. Were you affected by the Malu Fernandez controversy?
2. Do you know anyone who is an overseas Filipino worker? (OFW)
3. Do you have a relative who is an OFW?
4. Do you believe that many Filipinos are working abroad because of the lack of opportunities here in the Philippines?
5. Do you believe that OFWs help the Philippine economy?
6. Do you believe that the present administration is corrupt and there has to be some changes?
7. Are you an OFW, or an ex-OFW, or are you planning to become an OFW?

If you said yes to any of these, read on…

Perhaps you’ve heard of the controversial memorandum (1) of the Philippine Overseas Employment Administration (POEA) regarding the Guidelines on the Direct Hiring of Filipino Workers. Please allow me to explain to you why OFWs need your support against this memorandum. We really need your help! Please forward our plea for help to as many people as possible.

Who are the ‘direct hire’ OFWs?

There are two ways to get a job overseas. You can either go through an authorized recruitment agency in the Philippines or you can directly contact the employer. Obviously, those who can directly communicate with the foreign employer don’t have to go through a recruitment agency and so the process is referred to as “direct-hire” and they are called “direct-hires.”

OFWs who go through a recruitment agency usually have to pay their recruiter a placement fee and/or a commission. While those who are direct-hires sometimes take greater risks by staying in a foreign country (sometimes as tourists) and then by God’s grace and through their contacts, they find work. Some direct-hires find work while still in the Philippines when the employer comes to the Philippines to screen applicants.

Both ways of finding work have their own advantages and disadvantages, depending on the jobsite, employer, work, and the contract. (2) There are those who say that it’s important to go through a recruitment agency because they make sure that the employer is a good one. Recruitment agencies also look after you when you’re already in your jobsite. On the other hand, there are others who think that they can do away with recruitment agencies. They think they can deal directly with their employers and they can handle their own problems. And if not, they can always run to the Philippine embassies for help. That’s why they’re there, right?

If you were to choose between the two, which one do you prefer: Go through a recruitment agency or directly deal with the employer?

There is another important thing that we should keep in mind when it comes to the definition of direct-hires. Let’s say an OFW who went through a recruitment agency in their first overseas job finishes their contract with their employer. If he/she decides to find another job overseas with another employer, he/she is now a “direct-hire.”

Before Memorandum No. 4

Let’s say, an employer in the Middle East needs to hire an engineer. A Filipino engineer, who has just finished his contract with another employer, applies for the job. He came highly recommended by his previous employer and so he was accepted in the job. His new employer offered him a salary of $1,000 a month. He was more than happy to take the job, especially because if he can’t find work, he will be forced to go back to the Philippines. They signed the contract and the OFW starts working the next day. Simple, right? That’s direct-hiring!

Enter Memorandum No.4!

Memorandum No.4 (Series of 2007) signed by POEA Administrator Rosalindo Dimapilos-Baldoz took effect on January 15, 2008. All employers, whether individuals or companies, must abide by the so-called “guidelines.”

Let’s go back to the story of our Filipino engineer. Now, according to this memorandum, he can’t start working for his new employer. Not yet! First, his employer has to register with POEA. But there’s no need to worry, because the process will not take longer than one month. One month! You mean to say that the Filipino engineer has to wait for a month before he can start working! That’s okay, says POEA. I’m sure his family can wait for a month before he can send money for their food and utilities.

But there’s more to it. There are more requirements that the employer has to submit. Here are the other requirements:

1. The employer must submit the following documents to POEA:
a) copies of their business registration, license, and identification paper
b) sample contracts for the OFW
c) proof that the OFW won’t be charged a placement fee (hello? it’s called “direct-hire”)

2. Pay a “performance bond” equivalent to the worker’s salary for three months. The performance bond will be used to guarantee compliance of the employer of the contract. So, the performance bond will serve as a penalty fee for the employer in case there’s a breach of contract by the employer. It’s not clear in the memorandum if this performance bond will be given in full to the direct-hire OFW.

In the case of our OFW engineer, his employer has to pay $3,000 ($1,000 x 3 months) which is approximately P120,000. This sum is to be paid even before the OFW starts work. Wow!

3. Provide a “repatriation bond” in the amount of $5,000 or approximately P200,000. This money is to be used for the direct-hire’s repatriation expenses in case the contract is terminated. Also, in case the OFW dies while overseas, this money is going to be used to bring the remains back to the Philippines.

I thought the government considers OFWs as our modern-day heroes. Then how come they can’t even afford to bring back the remains of OFWs who die while working overseas. I thought this is why OFWs are required to pay their PhilHealth even though they’re not in the Philippines.

4. And the last requirement to get the registration process started is the submission of a Medical Insurance Certificate

Isn’t it common practice that the application for medical insurance gets started as soon as the employee starts working? I think this is also true for companies in the Philippines. And isn’t it true that it takes a while before the insurance company releases the medical insurance certificate. Sometimes, it even takes about three months before the document is released. Wow!

In other words

If you were an employer looking for foreign workers, would you really go through the trouble of doing all the above requirements? Would you be willing to set aside $8,000 or approximately P320,000 so your Filipino employee can start working for you?

I do admire our government’s high regard for our OFWs. They really believe that employers will jump through hoops to get a Filipino worker.

I really hope that employers will do all these things to get a Filipino worker. But what if they don’t? What if there are so many foreign workers in the global market these days that they can easily get workers from other countries whose governments don’t have ridiculous requirements? What if they decide not to hire Filipino workers? Who is going to be directly affected by this? Who is going to suffer?

Who is going to suffer?

It’s fairly obvious that our OFWs are the ones who will be badly affected by this memorandum and I am one of them. Whether you are an engineer, teacher, domestic helper, nurse, doctor, or any other overseas employee, as long as you hold a Philippine passport and you have a job overseas, you will suffer because of this memorandum. If you don’t lose your job now, you’ll have trouble looking for a job later.

Families who rely on remittances of their OFWs will also be badly hit by this memorandum. How can OFWs send money home if they don’t have a source of income because they have no work? We all know that many OFWs have mouths to feed and siblings to help send to school.

Another victim of this memorandum will be our economy. OFWs brought in $15 billion to our economy in 2007.(3) This amount of money is not to be taken lightly. If you think that the call center industry is helping our economy, then multiply it by five times and it will match the amount of money brought in by OFWs.

And how will this affect small and big business companies in our country? Well, let’s try to simplify it for everyone. Less employers mean less work for our OFWs. Less work means fewer OFWs. Fewer OFWs means less remittance. Less remittance means less “spending power” of Filipinos. Less spending power means less money for other things. People will only have money for their basic needs and commodities. Other businesses will close and there will be less jobs for the millions of Filipinos who are working in the Philippines. So they will start to look for work overseas but they won’t be able to find any. All thanks to Rosalinda Baldoz’s Memorandum Circular No.4.

So who’s going to suffer from this memorandum? You! Me! Everyone!

What should we do?

If you ask me, the first thing we should demand is the immediate resignation of Rosalinda Dimapilos-Baldoz, the POEA administrator who signed Memorandum Circular No.4. This memorandum is evidence that she doesn’t understand the needs of OFWs and she does not deserve to be at the helm of POEA.

Our second demand should be the immediate revocation of Memorandum Circular No.4. We should all join the mass protest action. It’s clear that we will all suffer because of this new policy on direct-hires. Don’t hesitate to take it to the streets. That’s the only way we can get their attention. Let’s show them that we are serious in demanding for the resignation of Baldoz and the revocation of the memo.

If in case you can’t join the mass protest action, here are other ways you can help this urgent cause:

1. E-mail your relatives, friends, and every one you know and ask them to join the protest. Forward the link to this post and other posts about this issue to your friends. There’s also a Filipino version of this post.

2. Text all your contacts and ask them to support our protest.

3. Support the Senate inquiry of Senator Manny Villar (4). E-mail Senator Manny Villar at mb_villar@yahoo.com or go to his website, www.mannyvillar.com.ph

4. Support the Congress resolution of Representative Teddy Casino of Bayan Muna party-list (5)

5. Sign the online petition (6)

6. Blog and comment in blogs about Baldoz and her memorandum. When Malu Fernandez spoke badly about the OFWs, we were quick to point out her wrongs and we succeeded. More than ever, our OFWs need your help. Please hear our plea.

My friend, let’s take action! Let’s demand for the resignation of Rosalinda Baldoz and for the revocation of Memorandum No.4!

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Notes:
(1) POEA Memorandum Circular No.4 - Guidelines on the Direct Hiring of Filipino Workers
(2) Magandang ipalabas ng POEA ang kanilang statistics kung ilang OFW ang dumaan sa recruitment agency at ilan ang direct-hire.
(3) Top international economist says Philippine economy has to grow 14% to stop OFW exodus, Positive News Media, Jan 31, 2008
(4) $5K bond hinders Pinoys’ search for better opportunities - Villar seeks Senate inquiry on new direct-hire guidelines
(5) Solon wants memo on OFW hiring scrapped, Feb 3, 2008, GMANews.TV
(6) Online Petition - Abolition of (POEA) Memorandum Circular No. 4