FIRB says WFH only temporary, pushes for fully reopening economy

The Fiscal Incentives Review Board (FIRB) continues to resist calls from certain sectors for a more permanent scheme allowing work-from-home (WFH) or work-from-anywhere (WFX) in information technology and business process outsourcing (IT-BPO) firms and registered business enterprises (RBEs).

In a statement issued April 28, Department of Finance (DOF) Assistant Secretary Juvy Danofrata said that “the current situation already allows us to direct our policies towards fully reopening the economy.”

“Given the increasing vaccination rate of Filipinos nationwide, we can now undertake safety measures for the physical reporting of employees,” Danofrata added, “In fact, the President has ordered all government agencies and instrumentalities to adhere to the one hundred percent (100 percent) on-site workforce under Alert Level 1.”

To recall, the FIRB decided via Resolution 19-21 to allow WFH for up to 90 percent of the IT-BPO workforce until March 31, 2022, while retaining the fiscal incentives available for companies located in economic zones.

This comes as the Philippine Economic Zone Authority (PEZA) continues to accept applications for letter of authority from PEZA-registered BPOs and RBEs seeking to implement an extended hybrid work arrangement. If granted, the said approval would remain in effect until September 12, 2022, the stipulated end date of the state of calamity in the Philippines by virtue of President Rodrigo Duterte’s Proclamation No. 1218.

In an earlier statement, DOF Secretary and FIRB Chairman Carlos Dominguez III clarified that BPOs are allowed to adopt WFH arrangements moving forward, and that the decision on which particular work arrangement to approve is an exercise of corporate management discretion.

“However, they must give up the tax incentives they currently enjoy because the law is clear on this,” the DOF secretary stressed.

In relation to this, multinational firm Concentrix has retained its WFH scheme for employees despite the “return to office” or “back to office” mandate in the Philippines which began on April 1, 2022.

“Because if the employee is the one really attending to the needs of the customers of our clients and they are happy where they are, the customers will also be satisfied,” said Concentrix Regional General Counsel in the Asia and Pacific and Data Privacy Officer Michael Montero in an online interview with the Philippine Daily Inquirer.

In a company survey last March which covered 10,000 of their workers, Concentrix found that the decision to stay of 80 percent of them would be affected by enforcing the return to office mandate. By sustaining a hybrid setup which allows WFH, however, Concentrix risks losing its fiscal incentives.

“We tied those two (conclusions) together. The clients are the ones who prefer it. The employees also want it,” he added, “By and large, we need to retain the status quo.”

This reaffirms what Concentrix Senior Vice President and Country Manager Amit Jagga earlier announced in an interview with CNN Philippines: Concentrix decided to let go of its fiscal incentives to keep the benefits of hybrid work.

“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.”

According to him, over a million BPO workers currently contribute to the economy under the hybrid work model.