Stop contractualisation of regular jobs in banks!
We, the rank and file employees of the banking and financial industry, call on President Rodrigo Roa Duterte to stand by his promise on ending contractualisation, outsourcing in Banks. We vehemently protest Department of Labor and Employment’s issuance of Department Order 174 which, similar to D.O. 18-A of
We vehemently protest Department of Labor and Employment’s issuance of Department Order 174 (DO174) which, similar to D.O. 18-A of Aquino, legitimizes contractualisation and outsourcing schemes that diminish regular bank employment and busts our unions.
BSP Issuance of Circular 268 of 2000
The passage of Circular No. 268, more popularly known as the “Outsourcing of Banking Functions” was issued by the Banko Sentral ng Pilipinas (BSP) on December 5, 2000 after approval by the Monetary Board on November 24, 2000 to implement Section 55.1 (e) of Republic Act No. 8791, otherwise known as the General Banking Law of 2000.
We account that in totality by the end of August of 2012, a total of 90 banking functions have been identified outsourceable. These functions comprise 90 percent of our unions’ membership.
On 3 August 2012, BSP issued a new circular, Circular 765, seemingly addressing the concerns of the employees. Services normally associated with placement of deposits and withdrawals including the recognition based on records of movements in the deposit accounts, granting of loans and extension of other credit exposures, position-taking and market risk-taking activities, managing of risk exposures and strategic decision-making positions can no longer be outsourced. With this, it remains that 90 percent of our unions’ membership could be wiped out through outsourcing.
Moreover, the Circular 765 give banks leeway to outsource functions to third-party automatically without the approval of the Monetary Board provided CAMELS composite rating of “3” is achieved. It, further, enumerated that only five (5) banking functions that should remain plantilla positions and the rest of the functions being non-inherent are outsourceable. This would mean 90% of regular rank and file positions lost for international banks while as much as 80% for local banks.
BSP harps on the inclusion of Section 55.1 under item E of the General Bank of 2000 that it is a prohibited act to outsource inherent banking functions. BSP later on, through its circular, defined “inherent” in the favor of bank corporations without the consultation with the stakeholders particularly us, the bank employees.
Adding more insult to injury is the implied disclosure of Section 2.2 of the Circular, and we quote,“Banks cannot outsource management functions”. It is crystal clear to our mind that BSP shows favorable concessions with bank owners in protecting their investments rather than protecting employees’ rights under the law.
Recent Outsourcing Activities in Banks
This scheme resulted in redundancy and termination of employment of many regular employees. This scheme, at the same time, pushed to lower wage among bank employees. It pushed unions to lose membership and thus weaken its bargaining power. Many have become contractual workers in banks. And thus, these workers are not included in the benefits of the Collective Bargaining Agreement (CBA).
On 16 October 2013, seventeen (17) bargaining members’ positions were declared as redundant hence, along with it, the termination of the employees carrying those posts.
Another batch of the same scheme of PBCom announced on April 2014 declared six (6) rank and file posts as redundant. These posts are from the Messengerial Department and the Credit Documentations Section.
These schemes resulted to the severance of employment of two (2) union officers.
The outsourcing of HSBC started in 2008 involving the closure of Customer Sales Inbound function. In 2009, HSBC outsourced about 450 functions to Global Service Center- HDPP (HSBC Data Processing Philippines), a third party agency. Migration followed in 2013 for Payment Investigation and Corporate Real Estate.
Since December of 2009, the union members under the collective bargaining agreement plummeted from around 770 to 265 in March 2015. The Union lost more than two-thirds of its membership in 5 years.
HSBC, again, announced outsourcing of other functions of Collection effective June 2015 slicing another 50 positions from the bargaining unit.
Three (3) rank-and-file positions were declared redundant effective 31 December 2016 as the supposed last tranche of affected positions of Project Green.
HSBC’s bargaining unit members are at 123 as of March 2017.
RCBC, Standard Chartered, Security Bank
Membership of the Union in RCBC fell from 3200 in 1996 to just 1200. Standard Chartered union members are now around 70 from 314 in 2008. Security Bank Employees Union registering 800, are at 100 union members at present.
BPI Group (Main and the Family Savings Bank)
In the recently implemented processing of checks through Check Image Clearing System (CICS), BPI announced that there will be seventy-seven (77) positions which will be redundant where affected position-holders will be redeployed on a best effort basis. Unisys, a third party service provider, will assume the encoding of checks.
Breach of Confidentiality of Bank Information
We are also raising the alarm that with the outsourcing of banking functions, there is a breach of the Security of Bank Information which is protected under the Bank Secrecy Law. Through outsourcing, bank share or transfer bank information to third party agencies which the proliferation of spamming bears as a result.
Bank unions protest against contractualisation
From the inception of these schemes in the Banks in the year 2000 until August of 2012, bank employees protested, rallied over and called repeal of BSP 268 and succeeding outsourcing circulars. Such, Resolution of the RTIPC and various Resolutions from Congress and the continued cases and grievances raised by unions made such scheme so popular amongst us.
Employees, under the Philippine Constitution, have the Right to Security Tenure. Article XIII Section 8 it is stated that “It is state policy to assure all workers to Security of Tenure.”
In contrast, the Aquino Government through the Department of Labor and Employment strengthened outsourcing and contractualisation by the issuance of the department order 18-A. However, contractual obligations of Banks with Labor Unions under the Collective Bargaining Agreement in the early 2000s have adhered to Department Order 18-02.
DOLE Department Order 174 under the Duterte administration will allow contractualisation, outsourcing to persist. It allows the continuation of the outsourcing schemes and legitimizes the existence of “agencies”. Agencies break the chain of employee-employer relationship with capitalists that suppresses the right of employees to a living wage, right to association and right to collective bargaining.
At any rate, it must be remembered that under Article 280 of the Labor Code, an employment is deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer. We are guaranteed under the Philippine Constitution Article XII Sec 3: “The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all.”
This provision, the Social Justice Provision and the Equal Protection of Labor and Capital Provision of the Philippine Constitution, is being undermined by the “Outsourcing Schemes in the Banking Sector”, – the BSP Circular 268 and its related succeeding circulars, at the expense of the labor.
Our aggrupation has 21 roster-member bank unions. The Secretariat are from Hongkong and Shanghai Bank Ind. Labor Union (HBILU), Philippine National Bank Employees Association (PEMA), Planters Development Bank Employees Association (PDBEA), now with Chinabank Savings and BPI Metro Manila Employees Union (BPI EU –MM).