Government stands pat on return to office of IT-BPM workers

MANILA, Philippines — The Cabinet-level Fiscal Incentives Review Board (FIRB) is standing pat on its decision to require all workers in the information technology and business process management (IT-BPM) sector to return to office by April 1.

Finance Secretary and FIRB chairman Carlos Dominguez III yesterday said IT-BPM enterprises should instruct their workers to report on site by April 1 to comply with FIRB Resolution 19-21.

Under the directive, the IT-BPM industry was allowed to maintain as much as 90 percent of its labor force under a work-from-home (WFH) arrangement until March 31 only.

Dominguez pointed out that remote work was allowed to protect IT-BPM employees from contracting the COVID virus at the height of the pandemic, but a return to office can now be pursued as the vaccination program has reached more than half of the population.

“The work-from-home arrangement is only a time-bound temporary measure adopted during the surge of the COVID-19 pandemic. Given the increasing vaccination rate of Filipinos nationwide, we can now undertake safe measures for physical reporting of employees, including workers in the IT-BPM firms operating within ecozones and freeports,” Dominguez said.

The Philippine Economic Zone Authority had earlier proposed that the WFH arrangement for IT-BPM firms be extended without the required 10 percent onsite capacity and risk of losing their incentives until Sept.12.

The FIRB warned IT-BPM firms that failure to comply with the order will lead to the suspension of their fiscal incentives.

Further, Dominguez announced that the FIRB rejected the petition to lift the moratorium against economic zone development in Metro Manila. The board upheld Administrative Order 18 signed by President Duterte in 2019 preventing developers from putting up new economic zones in the nation’s capital.

The FIRB said the presidential order complements the government’s strategy to force investors to the countryside as promoted under the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act.

Under the CREATE Act, exporters locating in Metro Manila can only secure up to 14 years of tax perks, while those operating in rural areas can get up to 17 years of incentives.

Meanwhile, the Information Technology and Business Process Association of the Philippines (IBPAP) said it is seeking a smooth transition to onsite operations and will be continuing its push for a hybrid work model in the long term.

IBPAP president and chief executive officer Jack Madrid said in a statement yesterday that while the group supports the need to fully reopen the economy, it also has to consider the interest of its employees.

“As IT-BPM employees have an overwhelming preference for a balanced, hybrid work arrangement, we are working with our government partners to provide the industry a smooth transition to onsite operations toward a WFH or hybrid model in the longer term,” he said.

IBPAP has been pushing for government support in terms of being allowed to continue the WFH arrangement without affecting their incentives.It said this is key to the industry’s continued growth and to be able to compete with other players where flexible rules and regulations are being implemented to allow firms to implement the hybrid work model or combination of onsite and WFH. – Elijah Felice Rosales