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Industrial Relations and Collective Bargaining in the Philippines

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Industrial Relations and Collective Bargaining in the Philippines Working Paper No. 41 International Labour Office (ILO) DIALOGUE Route des Morillons 4 CH -1211 Geneva 22 Switzerland Industrial relations Tel.: (+41 22) 799 70 35 Fax: (+41 22) 799 87 49 and collective bargaining [email protected] www.ilo.org/dial in the Philippines Benedicto E.R. Bitonio, Jr. Industrial and Employment Relations Department November 2012 (DIALOGUE) ILO Regional Office for Asia ISSN 2226-7433 DIALOGUE and the Pacific Working Paper No. 41 Industrial relations and collective bargaining in the Philippines Benedicto E.R. Bitonio, Jr. Industrial and Employment Relations Department International Labour Office, Geneva ILO Regional Office for Asia and the Pacific November 2012 Copyright © International Labour Organization 2012 First published 2012 Publications of the International Labour Office enjoy copyright under Protocol 2 of the Universal Copyright Convention. Nevertheless, short excerpts from them may be reproduced without authorization, on condition that the source is indicated. For rights of reproduction or translation, application should be made to ILO Publications (Rights and Permissions), International Labour Office, CH-1211 Geneva 22, Switzerland, or by email: [email protected]. The International Labour Office welcomes such applications. Libraries, institutions and other users registered with reproduction rights organizations may make copies in accordance with the licences issued to them for this purpose. Visit www.ifrro.org to find the reproduction rights organization in your country. ILO Cataloguing in Publication Data Bitonio, Benedicto Ernesto R. Industrial relations and collective bargaining in the Philippines / Benedicto Ernesto R. Bitonio ; International Labour Office, Industrial and Employment Relations Department. - Geneva: ILO, 2012 1 v. (DIALOGUE working paper; ISSN: 2226-7433; 2226-7840 (web pdf) ; No.41) International Labour Office; Industrial and Employment Relations Dept collective bargaining / social dialogue / labour relations / enterprise level / Philippines 13.06.5 The designations employed in ILO publications, which are in conformity with United Nations practice, and the presentation of material therein do not imply the expression of any opinion whatsoever on the part of the International Labour Office concerning the legal status of any country, area or territory or of its authorities, or concerning the delimitation of its frontiers The responsibility for opinions expressed in signed articles, studies and other contributions rests solely with their authors, and publication does not constitute an endorsement by the International Labour Office of the opinions expressed in them. Reference to names of firms and commercial products and processes does not imply their endorsement by the International Labour Office, and any failure to mention a particular firm, commercial product or process is not a sign of disapproval. ILO publications and electronic products can be obtained through major booksellers or ILO local offices in many countries, or direct from ILO Publications, International Labour Office, CH-1211 Geneva 22, Switzerland. Catalogues or lists of new publications are available free of charge from the above address, or by email: [email protected] Visit our web site: www.ilo.org/publns Printed in Switzerland Foreword This paper is part of a series of national studies on collective bargaining and effective responses to the crisis conducted under the ILO Global Product on Supporting collective bargaining and sound industrial and employment relations , in close collaboration between the Industrial and Employment Relations Department (DIALOGUE) at ILO headquarters, the ILO Regional Office for Asia and the Pacific, and the ILO Decent Work Team for South Asia. The national studies seek to examine the impact of the crisis on industrial relations and collective bargaining institutions; and identify the ways in which collective bargaining was used to mitigate the effects of the crisis and the outcomes as they relate to employment, wages, working time and employment relations. They identify good practices in this regard and consider the implications for balanced and effective recovery. The paper provides a comprehensive analysis of the industrial relations trends and developments in the Philippines. It highlights the limited roles that industrial relations played in dealing with the global crisis. Both trade union density and collective bargaining coverage are low. The effects of collective bargaining are confined to the enterprise level where negotiations actually take place. Given its long history, the country’s industrial relations system itself is mature and stable, supported by the Labour Code and a comprehensive set of social legislation, but this also limits the scope of adaptation for change. The paper concludes that the industrial relations system requires renewal and reforms to make it more effective and sustainable, identifying specific areas that can be the target of reforms, including labour market governance, labour standards, wages and productivity, collective bargaining and dispute settlement. Such reforms should be through tripartism and social dialogue. DIALOGUE working papers are intended to encourage an exchange of ideas and are not final documents. The views expressed are the responsibility of the author and do not necessarily represent those of the ILO. We are grateful to Benedicto E.R. Bitonio, Jr. for undertaking the study, and commend it to all interested readers. Yoshiteru Uramoto Moussa Oumarou Regional Director Director, Industrial and Employment Relations Department iii Contents Foreword .............................................................................................................................. iii Introduction ............................................................................................................................ 1 Problems and assumptions ................................................................................................ 1 Organization and methodology ......................................................................................... 1 1. Pre-crisis and post-crisis economic situation and challenges ........................................... 3 1.1 GDP growth and effects of the global crisis ........................................................... 3 1.2 Employment and effects of the global crisis .......................................................... 4 1.3 Labour productivity, employment and wages......................................................... 6 1.4 Overseas employment .......................................................................................... 10 1.5 The crisis and its effects: Policy challenges ......................................................... 10 2. National-level institutions in industrial relations, collective bargaining, tripartism and social dialogue ......................................................................................... 11 2.1 Evolution and institutionalization of the industrial relations system: Policy periods ....................................................................................................... 11 2.2 Trade union and collective bargaining structure and coverage ............................ 15 2.2.1 General characteristics ............................................................................. 15 2.2.2 Union and collective bargaining structure ............................................... 15 2.2.3 Labor Code and policy changes, 1986–90: Long-term significance ....... 16 2.2.4 Trade union and collective bargaining performance ............................... 17 3. Philippine industrial relations after the crisis: Impact and policy innovations ............... 19 3.1 General impact of the crisis .................................................................................. 19 3.2 Policy initiatives and innovations in recent years ............................................... 20 3.2.1 Strengthening tripartism and social dialogue........................................... 20 3.2.2 Dispute settlement ................................................................................... 21 3.3 Labour productivity and wages ............................................................................ 27 3.4 Labor Code amendments ...................................................................................... 28 4. Collective bargaining trends at the enterprise level ....................................................... 29 4.1 Trends from the BLES profiles ............................................................................ 29 4.1.1 Recurrence of general historical patterns ................................................ 29 4.1.2 Trends in economic benefits .................................................................... 30 4.1.3 Trends in non-economic benefits ............................................................. 31 4.1.4 Trends in working hours .......................................................................... 32 4.2 Productivity-based bargaining .............................................................................. 32 4.2.1 A missing piece in Philippine industrial relations ................................... 32 v 4.2.2 Exceptional cases: Convergence of collective bargaining and productivity .............................................................................................. 34 5. The role of industrial relations institutions in promoting inclusive growth ...................
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