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THE PHILIPPINE LABOR MARKET TEST IN A GLOBAL WORKING WORLD: RE-EXAMINING PERSPECTIVES FROM THE CONSTRUCTION, TOURISM AND FINANCIAL SERVICES SECTORS WORKING WORLD TRIALOGUE SERIES 3.08 PROCEEDINGS OF THE FORUM 2008 Institute for Labor Studies With the support of Friedrich Ebert-Stiftung Philippine Office Research Team Kurt D. Romaquin Mary Grace L. Riguer Brenalyn A. Peji Stephanie B. Tabladillo Ma. Antonietta B. Alarde Creative Team Katherine B. Brimon Linartes M. Viloria Larry O. Dizon Cynthia R. Cruz Executive Director
Institute for Labor Studies 5th Floor, DOLE Building, General Luna Street, Intramuros, Manila, Philippines Tel. no. (632) 527-3447 Fax no. (632) 527-3491 www.ilsdole.gov.ph
Working World Trialogues Since its launch in September 2008, the Institute for Labor Studies (ILS) has conducted three forums under the platform of the Working World Trialogue Series: Square PegRound Hole Challenge: Solving the Mismatch (September 23, 2008); Green Jobs: Working with Climate Change (September 30, 2008); and The Philippine Labor Market Test in a Global Working World: Re-examining Perspectives from the Construction, Tourism and Financial Services Sectors (November 10, 2008). 1. What is the Working World Trialogues? A Trialogue is three parties conversing; these parties consist not only of the traditional tripartite parties that Department of Labor and Employment (DOLE) is accustomed to engage with (i.e., labor, employer). They may include other government agencies outside the labor and employment portfolio or other stakeholders concerned about issues at hand. 2. What are the key features of the Trialogue? Co-produced While labor and employment challenges are within DOLE areas of concern, the solutions are not incumbent upon DOLE alone. The idea is to move beyond organizational boundaries to pursue strategies for faster and more effective results. The working world has also changed and the issues have become more complex and interlocking; thus, there is the need to look at collaborative solutions. In co-producing, stakeholders increase their capacity without requiring additional resources. Issue-driven A Trialogue is more of a rapid assessment. Before ILS goes deeper into issues and subjects them to a Trialogue for discussion, it will seek to determine first the extent to which the issues can be resolved. User-defined Before ILS embarks on a Trialogue, it would first determine a defined end-user, which could just be the Institute, because it needs to know more about the issues, or policy makers and lawmakers. Demonstrable use A Trialogue is not about grand designs, but about practical solutions to issues. Cooperative inquiry As a cooperative inquiry, there is high practitioner involvement. Resource persons are experts in their fields of specialization. As a cooperative inquiry, a Trialogue is experiential (based on experience), presentational (for sharing of ideas) and practical (toward practical solutions). Research with and not research on The driver is the stakeholders collective interest about the issue at hand.
CONTENTS
I. OVERVIEW II. OPENING SPEECHES
Labor Market Test Policy vis--vis Multilateral, Regional, Bilateral Trade Agreements Towards Enhancing the Competitiveness of the Filipino Workers Setting Standards for Liberalization
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OVERVIEW
Commitments. On January 1, 1995, the Philippines acceded to the World Trade Organization (WTO), paving the way for the country to make binding commitments toward an open market economy and freer trade, both in goods and in services. Apart from the General Agreement on Trade in Services (GATS), the Philippines is a signatory to the ASEAN Framework Agreement on Services (AFAS) and a party to several bilateral free trade agreements (FTAs) or economic partnership agreements (EPAs) including the Japan-Philippines Economic Partnership Agreement (JPEPA) recently ratified by the Philippine Senate. At the plurilateral level, negotiations are ongoing for ASEANAustralia-New Zealand FTA (AANZFTA), ASEAN-Korea, ASEAN-China, ASEANIndia, and ASEAN-EU. In general, commitments under Mode 4 or Movement of Natural Persons of GATS, AFAS, and bilateral FTAs/EPAs demand liberalization of the country s labor market test provision. The test, more commonly referred to as economic needs test in GATS, restricts the entry of foreign nationals seeking to engage in employment. In the Philippines, the labor market test is enunciated in Article 401 of the Philippine Labor Code which requires that before a non-resident alien be issued an employment permit, there must first be a determination of the non-availability of a person in the Philippines who is competent, able and willing at the time of application to perform the services for which the alien is desired. This preference for Filipino labor is premised mainly on the Philippine Constitution2 which provides that the State shall promote the preferential use of Filipino labor, domestic materials and locally
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