Cha Cha means more wage cuts and lay-offs, says KMU

May. 15, 2009

Davao Today

DAVAO CITY The Kilusang Mayo Uno (KMU) in Southern Mindanao is wary of the proposal to amend the Constitution to open up the countrys resources to foreign companies, saying such proposal will only result to unfair working conditions for workers.

Arman Blas, KMU-Southern Mindanao spokesperson, said salary deductions, lay-offs and unfair flexible labor conditions that workers experience right now will worsen if government allow foreign companies to come in.

He reiterated the KMUs stand against constitutional amendments which would give multi-national companies greater control over our economy.

He said many cases of lay-offs and retrenchments were not caused by huge losses suffered by companies but because of the unchecked flexible labor practices by big companies, most of them foreign-owned. Flexible labor practices, which include contractual schemes, allow companies to save on cost because they would be spared from paying for workers security benefits companies are required to pay for keeping a regular workforce.

KMU national secretary-general Wilson Baldonaza said workers from poor countries like the Philippines bear the burden of the global economic crisis as foreign companies operating here extract more profits by paying their workers very low wages. He also said that the Department of Labor and Employment (Dole) and the Arroyo administration have been on the side with big businesses, exacerbating the abuses suffered by workers.

( photo by Barry Ohaylan)

“It is not true that labor flexible schemes, such as wage cuts, reduced shifts, forced leaves, contractualization and others, are the only solutions to prevent mass lay-offs,” he said.

KMU defines labor flexibilization as innovations in the work system introduced by companies. They include labor-only-contracting, subcontracting and the hiring of casuals and contractuals. In the Philippines, flexibilization is usually associated with the hiring of contractual labor, an unjust practice that undermines workers rights, according to KMU. Contractual workers, who earn 17 to 34 percent less than their regular counterparts, do not have the security and other benefits that regular employees enjoy.

Blas also called the job fairs that the government organize nationwide in time for the labor day as publicity stunt. He said was a slap to millions of the overworked, underpaid and heavily exploited workers in the country. “Job fairs cannot solve the perennial problem of unemployment and low wages,” Blas said.

The National Economic Development Authority (NEDA) data showed 40,000 Filipinos from the countrys export processing zones have lost their jobs as an effect of the global economic crisis. NEDA projected 800,000 more workers will be jobless by the end of the year. The NEDA projections did not include yet the 20,000 overseas Filipino workers (OFWs) recently retrenched as a result of the global financial crisis. Some 4.3 million Filipinos were already unemployed even before the crisis erupted.

Over 3,000 workers and affiliates of KMU ally groups took to the streets on labor day to demand for a stop of labor contractual scheme and the regularization of workers. They also asked for the social and insurance benefits to displaced OFWS, an across-the-board wage increases to workers in both the public and private sectors. They also asked the government to set up price control mechanisms, the removal of 12 percent tax on utilities, a crackdown on government corruption.

Our demands continued to be ignored by the Arroyo government, Blas said. Arroyo wants to remain in power by kowtowing to the interest of big capitalists and ignoring the demands of workers. (CJ Kuizon/

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