Flexible Work Arrangements

The sudden onset of the COVID-19 pandemic in 2020 forced most businesses to implement telecommuting and work-from-home arrangements to adapt to the evolving rules and quarantine protocols of the government. During this transition, companies had to invest heavily not only in information technology infrastructure (servers, laptops, software) but also in restructuring their business and human resource processes to address the challenges of conducting remote work.

Now that the country is gaining ground in its fight against the COVID-19 pandemic, we are slowly seeing things go back to normal. Having seen the benefits of working from home, however, some businesses and their employees would like to continue to operate under alternative work arrangements.

This resistance is particularly evident in Business Process Outsourcing (BPO) activities under the Philippine Economic Zone Authority (PEZA). During the early months of the pandemic, the latter’s Financial Incentives Review Board (FIRB), through its Resolution No. 19-21, allowed registered businesses to enjoy their tax incentives while implementing work-from-home arrangements until 31 March 2022.

Earlier this year, the PEZA Board moved for the extension of the applicability of FIRB Resolution No. 19-21, which was unfortunately denied by the FIRB Board.

Because of this, some companies in the IT-BPM sector are considering opting out of their tax incentives in favor of keeping work-from-home arrangements. Other companies are considering the adoption of alternative work arrangements such as compressed workweek schedules where the employees shall be required to report to work for less than (6) working days while maintaining the required forty-eight (48) hours per week by increasing workday hours up to twelve (12) hours per day.

In adopting alternative work arrangements, we would like to remind everyone of two (2) pertinent issuances by the Department of Labor and Employment (DOLE).

DOLE Department Advisory No. 04-10

The Department of Labor and Employment (DOLE) Department Advisory (DA) No. 04-10 or the Guidelines on the Adoption of Flexible Work Arrangements provides for the rules and limitations when conducting the compressed work week.

Under DOLE DA No. 04-10, the employer is required to notify the DOLE, through the Regional Office which has jurisdiction over the workplace, of the adoption of any flexible work arrangement prior to the implementation thereof. The notification should include details such as the reason for adopting the flexible work arrangement, the total number of employees affected, the previous work schedule, the new schedule to be implemented, and how the voluntary agreement of the majority of the employees was taken.

The Report Forms needed for the notice can be downloaded here: CWW Notice or BWC-WHSD Form

DOLE Department Order No. 202, series of 2019

Telecommuting, as defined under Republic Act No. 11165 (also known as the “Telecommuting Act”), refers to a “work arrangement that allows an employee in the private sector to work from an alternative workplace with the use of telecommunication and/or computer technologies.” An alternative workplace refers to a location other than the regular workplace.

An employer in the private sector may offer a Telecommuting Program to its employees on a voluntary basis and upon such terms mutually agreed on. The conditions in the Telecommuting Program must not be less than the minimum labor standards provided by law, including compensable work hours, minimum number of hours, overtime, rest days, entitlement to leave benefits, social welfare benefits, and security of tenure.

Since the telecommuting arrangement involves the use of technology for telecommunication, data privacy is crucial. Both the employer and the employee must agree on the minimum standards that will protect personal information and shall utilize available technology to promote security and privacy. Corollary to this, Republic Act No. 10173 or the Data Privacy Act of 2012 shall have suppletory effect.

Under DOLE DA No. 202-19, the employer shall notify DOLE on the adoption of a telecommuting work arrangement by submitting the prescribed report form to the nearest DOLE Field or Provincial office having jurisdiction over the area where the principal office is located. If the employer has branches or operational units outside the region of its principal office, each branch or operational unit shall also submit its respective report to the same.

The Report Form needed for this can be downloaded here: Telecommuting Report Form