Based on the Labor Code Article 106 Section 3 (APPENDIX A), In legitimate contracting, there exists a trilateral relationship under which there is a contract for a specific job, work or service between the principal and the contractor or subcontractor, and a contract of employment between the contractor or subcontractor and its workers.
Hence, there are three parties involved in these arrangements, the principal which decides to farm out a job or service to a contractor or subcontractor, the contractor or subcontractor which has the capacity to independently undertake the performance of the job, work or service, and the contractual workers engaged by the contractor or subcontractor to accomplish the job work or service. Contracting or labor contracting is the replacing of regular workers with temporary workers who receive lower wages with no or less benefits.
These temporary workers are also known as contractual, probationary, trainees, apprentices, helpers, casuals, piece rate employees, agency-hire, and project employees. They do the work regular workers for a specified and limited period of time, usually less than six months. The work they do is “desirable and necessary” for the company’s survival, but they never become regular employees even if they get rehired repeatedly under new contracts. (Wikipilipinas.
org) While contractual employment is allowed under Article 106 of the Labor Code of the Philippines, this clause has been used and abused over time and led to the contracting of labor. (Wikipilipinas. org) At present our country is having a large population of unemployed individuals. As stated in the blog of Dr. Jose Mario B. Maximiano one way to decrease the impact of unemployment in our country is to offer contractual jobs to individuals. The problem is contractual jobs are not for the long term. Some of the contractual employees are not aware of their rights and privileges as well.
According to the blog of Dr. Jose Mario B. Maximiano, contracting has become the main form of labor in many Philippine businesses, a good reason why there are hardly any labor unions in the country or why most workers are not organized in the new millennium. Contractual workers cannot afford to join unions because they are at the mercy of their employers. Many laws protecting workers protect only regular employment. The aim of the report is to be able to inform the users of the report about the social responsibilities of the business entities towards contractual employees.
To be able to evaluate if contractual employees have enough knowledge about their rights and privileges and if their employers are properly exercising such social responsibilities towards them as well. The information needed would be the social responsibilities towards contractual employees and the characteristics of good working conditions under this type of employment. In order to obtain this information, the researchers will gather pieces of information from books, internet and other resources regarding social responsibilities towards employees.
The researchers will also conduct interviews in order evaluate whether employees have enough knowledge about their rights and privileges and if their employers exercise social responsibilities towards the employees. These interviews will be conducted to the contractual employees of different department stores in San Fernando City La Union. At the end of the report, the reporters expect that the users of the information are fully guided with the social responsibilities towards contractual employees and be able to know their rights and privileges in entering in such type of employment.