Tuesday, October 26, 2021
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PEZA wants IT-BPO sector exempt from new WFH guidelines

  • The Philippine Economic Zone Authority is seeking to exempt information technology-business process outsourcing companies from new work-from-home guidelines
  • Under Fiscal Incentives Review Board Resolution No. 21-19, employees under WFH arrangements should not exceed 90% of the total workforce of registered IT-BPO enterprises until March 31, 2022
  • Instead of total workforce, PEZA wants gross revenue temporarily reinstated as basis for IT enterprises’ WFH arrangement
  • The appeal is anchored on the threat posed by the highly contagious COVID-19 Delta variant on workers returning to the worksite

The Philippine Economic Zone Authority (PEZA) is asking the finance and trade departments to exempt information technology-business process outsourcing (IT-BPO) companies from new work-from-home (WFH) guidelines of the Fiscal Incentives Review Board (FIRB).

In a letter to Finance Secretary Carlos Dominguez and Trade Secretary Ramon Lopez, PEZA backed the request of its IT-BPO locators to reconsider maintaining the WFH arrangement PEZA implemented at the beginning of the pandemic under Memorandum Circular (MC) No. 2020-011 dated March 5, 2020. The MC was further extended under various MCs until September 12, 2021.

Under the PEZA directives, registered IT enterprises were allowed to engage in WFH operations to the extent of up to 90% of their total revenues.

The PEZA Board last July recommended extension of the WFH arrangement. Under Resolution No. 21-206 dated July 6, 2021, PEZA requested that the extension of the WFH arrangement be based on the gross revenue of IT enterprises.

The FIRB, which has authority over investment promotions agencies like PEZA, approved the extension, and PEZA released MC 2021-049 in adherence to the directives of FIRB.

However, with the recent release of FIRB Resolution No. 21-19, the number of employees under WFH arrangements should now not exceed 90% of the total workforce of the registered IT-BPO enterprises until March 31, 2022.

PEZA noted this essentially means IT-BPO companies should maintain at least 10% of their total employees onsite.

“This directive poses a problem because a number of employees are understandably hesitant to report to work because of the surge in the number of infections and the over-capacity of the hospitals in case they get infected by the virus. While the enterprises are grateful for the extension of the WFH arrangement, the health and safety of their employees is still their primordial consideration,” explained Plaza.

She noted the appeal of IT enterprises is anchored on the threat posed by the highly contagious COVID-19 Delta variant.

The PEZA chief added: “This will defeat the purpose of the extension of the WFH arrangement which is to limit the mobility of workers and lessen the pressure on public transport because they will contribute to the number of people outside even if it is possible for them to perform their jobs within the confines of their respective homes.”

Accordingly, PEZA appealed to the FIRB to reinstate the basis of the threshold of the WFH arrangement to gross revenue, instead of total workforce, as a temporary measure available to IT enterprises. This is to support the companies’ recovery and protect their employees from the risks of contracting COVID-19 in the workplace.

The revenue-based computation of the threshold will afford more protection to employees and is more in keeping withthe intent of the resolution, PEZA noted.

Likewise, the IT & Business Process Association of the Philippines (IBPAP) said the clarification on the threshold is “a fair treatment considering that any breach that might happen would only be due to compelling circumstances such as putting the health and safety of employees as more paramount.

“In light of the recent surges in COVID cases, our member companies are heeding the call of the national government to place as many of their employees under WFH as possible so as not to expose them to the risk of catching COVID-19 when going out to work.”

IBPAP further explained, “Our members are registered enterprises that aim to maintain their export revenue commitments and keep their people to ensure seamless delivery of services. However, there are factors affecting revenue and employee attrition that are beyond the control of the enterprise.”

As such, PEZA also requested for leniency from the FIRB in imposing penalty on the enterprises struggling to comply with the latest directive.

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