BPOs move away from ecozones to keep WFH for workers

Information technology and business process outsourcing (IT-BPO) firms are reportedly beginning to move away from ecozones administered by the Philippine Economic Zone Authority (PEZA) as they either register with the Board of Investments (BOI) or have their companies listed as normal corporations to help retain their employees working from home. This in response to the “return to office” or “back to office” scheme being mandated in the Philippines starting April 1.

Earlier, the Fiscal Incentives Review Board (FIRB) decided via Resolution 19-21 to allow the hybrid work scheme until March 31, 2022, with work-from-home (WFH) or work-from-anywhere (WFX) available for up to 90 percent of BPO workers.

“What we’ve been telling them is the same incentives if you fall under the BOI-covered incentives under the different tiers then maybe just register with the BOI because that business model works for you,” said Department of Finance Assistant Secretary Paola Alvarez in an interview with CNN Philippines, “We have other locators who are now deregistering from PEZA and registering as normal corporations.”

From 2016 to 2019, Alvarez noted that IT-BPO firms have enjoyed an average of PHP 26.30USD 0.45INR 38EUR 0.43CNY 3 billion in total tax incentives. She also cited that there are locators willing to comply with the mandate to operate in ecozones.

In a separate interview also with CNN Philippines, Concentrix Senior Vice President and Country Manager Amit Jagga announced that Concentrix decided to let go of its fiscal incentives to keep the benefits of hybrid work. According to him, over a million BPO workers currently contribute to the economy under the hybrid model.

“Most of our sites are with PEZA. It is becoming tough. While the government wants us back, and we are happy to operate, but out staff really want to be home,” Jagga explained, “This will not only create an impact on the overall competitiveness of the Philippines, but it will also create an impact on our staff.”

Concentrix has reportedly registered two of its new sites with the BOI. At the moment, around 35 percent of Concentrix employees are working on site, while the remaining 65 percent still work through the hybrid setup.

For their part, Department of Trade and Industry (DTI) Undersecretary Ruth Castelo clarified in a Laging Handa Briefing that their department can review for those who would file exemptions to the FIRB decision, “Pwede naman silang manghingi ng exemption kung talagang mai-justify nila, they can request DTI – Secretary Lopez will look into it – para kung makakapag-exempt. But ang thrust talaga natin is to encourage economic activity.”

Meanwhile, PEZA has called for BPO companies to abide by the FIRB regulations as they continue to campaign for the implementation of an extended hybrid work setup.

“PEZA supports the hybrid work scheme as it’s been proven effective in the last three years of pandemic. What we can do is to recommend this for the next administration to address. As of now, we have to abide by the existing laws and the decision of the FIRB and help to put the economy back to normal,” said PEZA Director General Charito Plaza, who has also expressed intent on following how other nations such as India conducted their hybrid schemes.

To recall, PEZA has reportedly coordinated with the IT & Business Process Association of the Philippines (IBPAP) in proposing three hybrid work arrangements for the BPO industry implemented in staggered phases: 60 percent (onsite)-40 percent (WFH), 40 percent (onsite)-60 percent (WFH) or an equal 50-50 percent share for onsite and WFH arrangement.

On the side of BPO workers, the BPO Industry Employees’ Network (BIEN) Pilipinas cited that little preparation has been done for the transition to return to office.

“Wala pong naging workers’ consultation, so biglaan na lang ‘yung desisyon nila na bumalik on site,” said BIEN Treasurer Arcy Parayno, “Regarding tax incentives, sana hindi lang companies nabibigyan, pati ang BPO workers kasi katulad noong nakaraang lockdown, wala namang natanggap na ayuda ang mga BPO workers.”

BIEN is also advocating a salary increase, particularly for those who will return to their workplaces. They, however, bucked the threat earlier made by some BPO workers’ groups that there will be “mass resignation.”

“Sa hirap ng buhay ngayon, lalo na may banta pa rin ng Covid at ang taas ng mga bilihin, hangga’t maaari ayaw namin magkaroon ng mass resignation,” Parayno added.

It was the Alliance of Call Center Workers (ACW) which earlier revealed its survey of members regarding their response to the FIRB decision. A poll done by the group revealed that 157 of their members are mulling resignation from their jobs if the work-from-home (WFH) or work-from-anywhere (WFX) scheme will no longer be allowed, 117 are undecided, and 37 members indicated that they will stay in their work even if they have to go back to their offices.

Contrary to BIEN’s claim, however, the FIRB has maintained that they have done the consultations with the IT-BPO sector “even prior to its August 2021 meeting where Resolution 19-21 was adopted.”