New work environment

Even before the pandemic, work from home had been one of the proposals on the table to address the chaotic transportation situation in Metro Manila. The major hindrance to implementing it was our lousy broadband facilities outside the central business districts.

Fast forward to today… the pandemic lockdowns forced offices, including our dollar earning BPOs, to try work from home. BPOs invested in providing employees with reliable connection and moved some facilities to homes. It worked.

Forcing them to quickly return to the office is not as easy as flicking a switch. They have to manage the transfer of facilities, and their people have to adjust to the changed regime. Their request, as endorsed by PEZA, to allow work from home up to the end of September is reasonable.

Indeed, even property consulting firm Colliers has raised concerns that the Philippines may become less competitive than India, a principal competitor, that still encourages work-from-home arrangements.

The Fiscal Incentives Review Board (FIRB) does not have a really good reason for requiring the BPOs enjoying PEZA privileges to return to their offices by month end or lose their tax perks. For one thing, the pandemic is not really over and even the DOH is saying a spike in cases can happen any time.

For another, our transport services are still getting up to speed from two years of minimal operations. The EDSA bus carousel system is plagued by late payments of service contract fees.

The drivers, one letter writer complained to me, do not receive their P300 stipend on time, lugi raw sila at umuuwi na lang sila pagkatapos ng tatlo hanggang apat na ikot sa Carousel.

The bus conductor told the letter writer that normally, they would call it a day as early as 1 pm. No wonder commuters have difficulty catching a ride late at night when BPO workers need public transportation most. Or, the buses are overcrowded, with no social distancing.

Of course the DOF economic managers have cars.

The lame reason the economic managers cite for ordering employees to return to their physical offices is they will speed up the recovery of the economy by spending on food, transportation, and other incidental expenses.

One big problem of companies is that many of their employees have adjusted to working from home. They will need time to make arrangements for househelp and baby sitters to allow them to go back to the office.

Many employees will choose to quit altogether causing disruption of operations. Companies will also lose their investments in training them.

Now that many workers have seen how to combine work and home responsibilities, they will just look for companies willing to take them on WFH basis.

Then there is our horrible traffic situation and inadequate public transportation system. Spending four or more hours a day commuting is a nightmare many now know they don’t have to suffer. The high cost of gasoline is another disincentive to leave WFH.

A good way to get back to the old normal is to go hybrid first. Maybe working three days in the office and two days from home would be a good start. Most worrisome to BPOs is the risk of losing competitiveness, as one industry executive pointed out:

“On a macro level, the competitiveness of the country’s outsourcing industry may also be at risk as it competes with other markets (e.g., India) where increased WFH allowance may provide the advantage of stronger employee retention, engagement, and performance.”

The DOF says reluctant firms can always give up their perks if they can’t go back to the office by month end.

The “our way or the highway” approach of our economic managers is pathetic. It seems they are in panic mode, trying to leave an economy fully recovered from the pandemic before June 30. That’s unreasonable.

The IT-BPM industry is one of just two main pillars of our economy, and it must be helped to remain competitive. It has consistently been an integral contributor to the country’s economic output. Our rules must be quick to adapt to the evolving needs of the industry and their employees.

The BPOs grew revenues by 1.4 percent to $26.7 billion in 2020 despite the pandemic-induced hard lockdowns. Shifting to WFH mode enabled them to do that. It also expanded headcount by 1.8 percent.

In 2021, industry revenues grew by 12 percent to $28.8 billion, while headcount expanded by eight percent to 1.4 million workers. The BPO industry is the largest employer in the private sector.

The FIRB/DOF says they want to revive the economy quickly, but they shouldn’t do that by handicapping the BPO industry.

Our government should realize that even if WFH was initially just a remedial response to the pandemic, it is now an alternative mode for workers. Higher productivity with this remote setup has been reported.

This is why Rep. Joey Salceda wants a “working compromise” on the DOF’s FIRB order against WFH BPOs.

“The work-from-home setup has made the BPO sector more inclusive, especially for parents with young children and those who care for loved ones at home,” Rep. Joey said.

Salceda seems unimpressed that there will be tax losses if WFH arrangements remain. He wants to get “a sense of the scale of the tax leakage that the FIRB is worried about. I just want to know the costs and benefits of the policy they’re insisting on.”

Presidential candidate Manny Pacquiao has the same concern.

“Our BPO workers are still helping our economy even if they are on WFH because they would still need to eat, spend money to relax, buy clothes, and many other things. They are helping other business sectors instead of spending most of their money on fares and fuel,” Pacquiao said.

Contrary to the DOF’s claim, Pacquiao said WFH arrangements “have no or have very little effect on the country’s micro, small and medium enterprises because BPO workers would still require their services even if they are working in their own homes.”

It seems PacMan has a better understanding of economics than the technocrats at DOF. Oh well.

Boo Chanco’s email address is [email protected]. Follow him on Twitter @boochanco