PEZA to appeal FIRB’s thumbs down of WFH extension

The Philippine Economic Zone Authority (PEZA) is not giving up on pushing for the extension of the work-from-home (WFH) scheme for IT-business process outsourcing (IT-BPO) firms located in economic zones.

This, after the Fiscal Incentives Review Board (FIRB) denied requests to extend remote-work arrangements beyond March 31, 2022.

“PEZA will still file its appeal for reconsideration on the denial by the FIRB. We hear the concerns of our investors and their workers and we will continue to lobby on it. For the meantime, I call upon our enterprises to follow the decision of the FIRB to avoid any penalties,” said PEZA director general Charito Plaza.

“While PEZA as a regulatory agency has to abide by the FIRB’s decision, our locators should already start planning the transition period for their return to office, with workers starting to report on site as decided by the FIRB,” she said.

The PEZA chief said the investment promotion agency remains positive of the FIRB's reconsideration as the IT-BPO sector is one of the biggest contributors to the country's employment and investments as well as digital and technology transfer.

The FIRB, during its February 21 meeting, upheld its Resolution No, 19-21, which allows firms in economic zones to implement work-from-home (WFH) arrangements for 90% of their workforce only until March 31, 2022.

This means that IT-BPO firms’ WFH arrangements will cease by the end of the month and all workers should return for on-site duty beginning April 1, 2022.

Plaza said PEZA has been receiving messages from workers of registered IT-BPOs raising concerns about costs, health, and safety regarding the return to office mandate.

Hybrid model

With this, the agency is supporting the proposal of the IT & Business Process Association of the Philippines (IBPAP)—the umbrella organization of the country’s IT-BPO industry— for a hybrid working arrangement for PEZA-registered IT-BPO companies.

“We are constantly in talks with IBPAP to still look into ways to include WFH or a hybrid work model in the IT-BPO sector’s operation in the Philippines. We should learn from the likes of India, one of our top competitors for IT-BPOs, wherein they are adjusting its policies and tax breaks to adopt hybrid work arrangement,” said Plaza.

Hybrid work model is a flexible model in which employees can work from both onsite and offsite locations.

In this arrangement, the employer and employees can agree on the percentage of WFH and those physically reporting to office depending on the position or functions of the employee.

“PEZA and IBPAP are doing their best effort to have the FIRB consider immediately the hybrid work scheme with its three schedules proposed to adopt the 60:40, 40:60, or 50:50 staggered implementations and let the new administration determine the appropriate work scheme considering the suggestion,” said Plaza.

IBPAP president and CEO Jack Madrid earlier said that “as IT-BPM employees have an overwhelming preference for a balanced, hybrid work arrangement, we are working with our government partners [like PEZA] to provide the industry a smooth transition to onsite operations towards a WFH/hybrid model in the longer term.”

Plaza cited the following reasons why PEZA is supporting a hybrid working model:

•     The increase of fuel and gas prices and its effect in increasing prices of goods is making transportation costly for workers
•     The pandemic is not yet over although we are now in Alert Level 1
•     The IT-BPOs invested during the pandemic for the equipment and enabling their workers to do WFH in a way that going back to 100% onsite should not be a sudden and immediate move
•     Adopting WFH also has benefits for decongesting traffic.

“The recommendation is consistent with the Telecommuting Law (RA 11165) — a legislation since 2018 that recognized ‘working from an alternative workplace with the use of telecommunication and/or computer technologies’ — which preceded the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act (RA 11534),” said Plaza.

She added that “this is in line with the emerging alternative work schemes implemented by India and other economies realizing that remote work is here to stay and as an innovative solution to be able to sustain particularly their booming IT services industry.”

Plaza said the PEZA will support IBPAP in its bid to present to the FIRB its proposal for a hybrid working model in IT-BPOs and the timeline they will implement this.

She noted that the validity of the national state of calamity is effective up to September 2022.

“We need to consider that we are not only dealing with the impact of the COVID pandemic, but also the domino effect of the ongoing war in Ukraine and Russia on the global market. The least we can do is help bring back our thriving economy, but not at the expense of our investors who help keep our economy afloat,” she said.—AOL,GMA News