Observation (CEACR) - adopted 2012, published 102nd ILC session (2013)

Labour Clauses (Public Contracts) Convention, 1949 (No. 94) - Philippines (Ratification: 1953)

Article 2 of the Convention. Insertion of labour clauses in public contracts. Further to its previous comment, the Committee notes the Government’s reference to Order No. 18-A of 14 November 2011 of the Department of Labour and Employment concerning Rules implementing sections 106–109 of the Labour Code. The Government indicates that a service agreement concluded under this Order between a principal employer (who may be any person or entity, including government agencies and government-owned and controlled corporations), and a contractor (defined as any person or entity engaged in a legitimate contracting or subcontracting arrangement providing either services, skilled workers, temporary workers, or a combination of services to a principal employer), must include a clause ensuring compliance with all the rights and benefits of the employees under the Labour Code, such as provision of safe and healthful working conditions, leave, rest days, overtime pay, 13th month pay, separation pay and retirement benefits.

The Committee observes, however, that Department Order No. 18-A does not pertain specifically to public procurement operations but rather to contracting and subcontracting arrangements in general and also that section 8 of the Order merely reaffirms that workers engaged under a service agreement enjoy the full coverage of the Labour Code in terms of wages, working time and social security benefits. As the Committee has indicated on numerous occasions, the fact that the general labour legislation is applicable to workers engaged in the execution of public contracts does not in any way exempt the Government from providing for the inclusion in public contracts of the labour clauses envisaged by the Convention. Such inclusion ensures the protection of workers in cases in which the legislation only establishes minimum conditions of work (e.g. minimum pay rates) which may be exceeded by general or sectoral collective agreements. Moreover, even if collective agreements were applicable to workers engaged in the execution of public contracts, the implementation of the Convention remains of full value because its provisions are designed precisely to ensure the specific protection needed by those workers. For example, the Convention requires the adoption by the competent authorities of measures, such as the advertisement of specifications, to ensure that tenderers have advance knowledge of the terms of the labour clauses. It also requires notices to be posted in conspicuous places at the workplace to inform workers of the conditions of work applicable to them. Finally, it provides for sanctions in the event of non-compliance with the terms of labour clauses, such as the withholding of contracts or the withholding of payments due to contractors, which may be more directly effective than those applicable for violations of the general labour legislation.

The Committee understands that the Government is currently considering the possibility of receiving technical assistance from the Office in the framework of a time-bound programme aimed at capacity building on international labour standards and reporting obligations. The Committee hopes that the Government will seize this opportunity in order to formulate either legislative provisions or administrative instructions and circulars which would fully incorporate the provisions of the Convention into the domestic public procurement regulatory framework. The Committee requests the Government to keep the Office informed of any progress made in this regard.