PEZA Cautions Workers Against Underground BPOs with No Security of Tenure, Says it is a “Loss to the Government”

The Philippine Economic Zone Authority’s director-general Charito Plaza has called for Business Process Outsourcing (BPO) firms to implement hybrid work setups again, and cautions against unregistered and “underground” BPO firms trying to lure workers away from registered firms without the security of tenure.

Plaza has informed the House’s tax-writing panel of unregistered IT-BPO firms evading the government and luring employees with higher salaries without the security of tenure and calls on registered BPOs to allow its employees to go back to hybrid work setups. As of now, the Fiscal Incentives Review Board (FIRB) is standing by its imposed orders for the resumption of BPOs’ onsite operations in order to keep their tax incentives.

“Nangyayari na po ngayon nakikipag-agawan ang mga underground IT-BPO sa employment. They are offering P30,000 to P40,000 for the IT workers, your honor,” Plaza states. “So mas lalo tayong nalulugi doon kung hindi natin i-allow yung hybrid at lalong madagdagan yung mga underground na mga IT-BPO who are not registered. So it’s a loss to the government.” the director-general also adds.

According to the Department of Finance (DOF), revisions to the Tax Code will need to be implemented first for BPOs to retain their tax incentives if under the hybrid work setup. Finance assistant secretary Juvy Danofrata says, ”We are not disallowing work from home – the CREATE [Corporate Recovery and Tax Incentives for Enterprises Law] has nothing to do with work from home, any work arrangement. But if you are registered in an economic zone, Section 309 said that the activity must be rendered inside the zone. That’s our basis.”

In order to retain workers preferring the remote work setup, IT-BPOs must keep their hybrid or WFH setup, with some BPOs already choosing to forego their tax incentives to keep their WFH setup. Currently, the Bureau of Internal Revenue (BIR) is conducting inspections to check the onsite work activities of IT-BPOs to ensure that they are operating at 100% capacity.

Source: ABS CBN News