MANILA – The Department of Labor and Employment has announced that it is looking on how to ‘secure’ the rights and social protection benefits of security guards.
Labor Secretary Rosalinda Baldoz said that her department is now solidifying the guidelines toward voluntary compliance of security agencies with general labor standards to ensure social welfare and protection of security guards.
Baldoz, who noted the recent meeting of DOLE officials and the Philippine Association of Detective and Protective Agency Operators (PADPAO) Inc., said the first step needed is to address the perennial problem of cutthroat competition among private security agencies.
“The DOLE has already established a partnership with PADPAO. This partnership, hopefully, will result in an extensive action plan to strengthen the implementation of the Private Security Agency Law (RA 5487) to ensure that minimum rates prescribed by law for standard salaries and benefits for security guards will not be compromised by any form of undercutting practices,” Baldoz said.
During the meeting, PADPAO president Ramon Bergado impressed upon the DOLE the dire need to amend the Government Procurement Policy Board (GPPB) rules to include a provision on agency fees or administrative expenses.
“This is to set a reasonable cap to prevent the undercutting of contract rates during public bidding,” he said. The government is one of the largest procurers of security services from private security agencies (PSAs).
The GBBP, based on the Government Procurement Reform Act, issues to government offices the bidding requirements of security contracts, which should be complied with by security bidders with regards to observance of prevailing minimum wages, social benefits, and correct payment of mandated taxes.
With the agency fee cap lacking on the GPPB rules, some security agencies offer bids way below the mandated contract rate by reducing the agency fee from 25 percent to the barest minimum of 2 percent. Consequently, minimum wages and other benefits of security guards are affected — reduced by winning bidders — to make up for the reduced fee.
“This ‘race-to-the-bottom’ practice is detrimental to security guards. With a benchmark on the agency fee or administrative overhead, which is part of the security contract, we are setting a standardized baseline and lowest possible rate in any security services bidding, be it a government or a non-government client. Hence, no undercutting practice will be allowed,” Baldoz explained.
The proposed agency fee cap placement complies with the provisions set forth in RA 5487, which strictly prohibits PSAs from engaging in cutthroat competition and from undercutting contract rates with existing minimum wage laws. Further, provisions on the entitlement of benefits, such as SSS, Pag-Ibig, and Phil-Health shall be closely examined, particularly the remittances and retirement benefits of security guards as covered by RA 7641.
Baldoz disclosed that the DOLE will facilitate a meeting between the PADPAO and the Department of Budget and Management once the proposed amendments to the GPPB guidelines and computation of administrative costs of PSAs are finalized.
“We shall also be coordinating with the Commission on Audit (COA) as we look into the contracts of security services entered into by government agencies to ensure compliance of contract price with the prescribed law under the GPPB,” Baldoz said.
Taking action on alleged PSA malpractices, Baldoz said the DOLE will be signing a memorandum of understanding with the Philippine National Police Supervisory Office for Security and Investigation Agencies (PNP-SOSIA) to enact a joint inspection on security agencies by the end of every month to identify PSAs that are engaging in contract rate undercutting practices.
Toward a holistic and long-term action plan, the DOLE also committed to educate PSAs, as well as janitorial service companies, on existing labor standards and social welfare laws through continuing Labor Education Seminars starting this December.
“We see the need to educate PSAs and service companies on labor-related requirements to lessen violations on minimum wage laws and other statutory provisions on wage and benefits. Education on labor laws is a must not only for labor standards and occupational safety and health standards compliance, but also toward industry self-governance,” Baldoz emphasized.