Trade Unions Today: Fortifying Tripartism In The Age of Globalization

In his broad-to-specific discussion, evaluation and comparative analysis of trade unions in the Philippines and in Southeast Asia, Dr. Virgel C. Binghay started off his track from Marx, Jose, Sydney, Webbh, Perlman, Dunlop, Ofreneo and Kerr’s ideas. He compartmentalized all insights on trade unions. For one, Marx pointed out trade unions as socialist’s movement against the capital mode of production. Sydney and Webbh focused on trade unions as economic and conditions of work advocates. For Dunlop, trade unions centers on wage maximization and employment prospects. On the other hand Perlman (1958), viewed trade unions holistically as revolutionary movement, democratic and political organization, economic institution, and psychology defense to early industrialism. Locally, Dr. Binghay also featured Dr. Ofreneo’s classification such as economic, political and ideological unionism.
Dr. Binghay rooted his discussion from early struggle in the Philippines as he featured the nascent form of trade unionism during Isabelo Delos Reyes’ foundation of Union Obrera Democratica Filipina in 1902. He then progressed from trade unionism under the American regime the republic act administration. Subsequently, it may be inferred from this transition that trade unions remained a form of struggle for the workers’ demands (which may obviously be inescapable). Although the American government had created the Bureau of Labor (BOL), the suppressed strike or workers only erupted after war. This had become more vicious during the Presidential Decree regime where Dr. Binghay emphasized the State domination in Tripartism. In pursuit of this subtle and repressive ideology, Trade Union Congress of the Philippine had been established. At the latter part of his discussion, Dr. Binghay laid all the challenges and room for improvements down for trade unions. He obtained his propositions from the Overseas Filipino Workers (OFWs) and Southeast Asian labor struggle.


Expecting hope from unification of trade unions in the country, workers however had only Buklod ng Manggagawang Pilipino (BMP), Killusang Mayo Uno (KMU) and Partido Komunista ng Pilipinas in frontline. As gleaned from Bitonio’s weigh on labor flexibility and workers’ representation, he mentioned that even union movement has also been saddled with fragmentation and factionalism. He said, “Hundred of unions adhering to different ideologies have proliferated in the Philippines. The 113 union respondents in the 2000 PLFS (Philippine Labor Flexibility Survey) alone were affiliated to 38 trade unions or labor centers. Standing says that representation security is derived from a sense of community among workers. In a globalizing work environment, a fragmented union movement divided in groups with dissimilar interests has undetermined collective strength.”
Simply put, Dr. Binghay’s views on ineffective trade unions may be caused by internal and external differences among them – this also includes rivalries in and outside the trade union. Moreover, it is noteworthy to mention that even trade unions have had docketed of cases which tainted their reputation and integrity. Some of these are illegal disbursements of funds, fraudulent transaction and poor performance of union officers. It would be affirmative to say that these trade union officers and workers themselves must be equipped with modern dispute settlement methods. Undeniably, workers would usually resort at relying to these union representatives instead of finding alternatives in resolving their conflicts. This has been one of the main reasons why Dr. Binghay’s submission pf emerging actors should be relevant.
Dr. Binghay also put his consternation on the surface as he mentioned about the dwindling number of trade union. He particularly cited Bitonio’s (2005) article concerning challenges and choices facing the Philippine labor movement in the 21st century as far as the unions are concerned. These challenges would range from automation of business process, global competition, economic liberalism, numerical and functional flexibility, technological advancement, and de-collectivization by employers. In addition to this, Bitonio cited labor cost flexibility in line, which pertains to relaxing or removing of restraints in order to prevent labor cost from adjusting. Trade unions failed to contend with drastic changes in economic development. The gradual decrease of unions doesn’t mean extinction of the same in globalization. Perhaps, it would be essential for trade unions to evolve and adapt flexibility on the brighter side. In wider sense Dr. Binghay would like the trade unions of today to adapt to changes.
In order to cope with these changes and challenges, Dr. Binghay contributed some strategies [as mentioned: reinvention, retooling and retraining] of trade unions. He suggested creating information system for the labor market, empowering of women, encouraging unions to be socio-economic partners and unifying no less than the labor movement. In this beam Multi-National Enterprises (MNEs) must also join this action in order to accentuate social responsibility above all. To fortify this, Dr. Binghay brought the Church, Non-Government Organization (NGO), Public Organization and the academe into light. It must realized though that the Church herein shouldn’t be confined to the Roman Catholic Church. For more NGOs, corporate social responsibility should embrace the spirit of helping the unskilled and the unemployed. In exhausting all other social mechanisms aside from trade unions, OFWs and its participating organizations may also play a vital role in helping them – prior to leaving the country, during their stay abroad and upon their repatriation. It’s about time for the State to establish workers’ representation for each country and for every type of job abroad.
Nevertheless, trade unions in the Philippine have been contrasted to those of Southeast Asian countries. Drawing from Dr. Binghay’s comparative analysis, Cambodia and Singapore have been embracing a single national trade union for all workers while other countries such as Indonesia, Malaysia and Thailand. These countries nonetheless experience the same struggle at the same time as the Philippines. The Philippines, on the brighter side, may also adapt best practices from Southeast Asian countries besides learning from their (likewise) difficult times.
Trade union as garnered from Trade Unions Today can only represent the workers’ aspirations to a larger extent. Indeed, unions do not exist alone at the national level. Workers nowadays need more concrete to realistic assistance of the society. It must be stressed that Tripartism as stipulated in Article 275 of the Philippine Labor Code should be limited to in aggregating employers, employees and Government representation in pursuit of industrial peace – for economic and social development based on social justice. It may be a cliché to just explain Social Justice in Article 13, Section 3 of the Philippine Constitution in the context of deciding in favor of labor in case of doubt or giving full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all.
Conversely, the State shall not only regulate the relations between workers and employers, recognizing the right of labor to its just share in the fruits of production and the right of enterprises to reasonable returns on investments, and to expansion and growth. Perhaps, it is high time to include all the sectors of society in uplifting and protecting the labor. Moreover, the NGOs and the academe for example may give rise to new knowledge and training among the unskilled workers who according to Bitonio are prone to non-regular employment. Likewise, Technical Education and Skills Development Authority (TESDA) alone cannot forever bear the hardships of the unskilled. Social Justice therefore can be extended to Labor Management Cooperatives and the emerging actors in industrial relations system. In the age of neo-liberal globalization, John Dunlop’s actors in this system may be restraining in exhausting all social mechanisms that could strengthen workers’ representation and empowerment.
Dr. Binghay’s insights may be germane to Labor flexibilization[1] (one of the by-products of globalization has limited the labor in establishing an organization). If employees would be working virtually through the Internet as they were hired on a project-basis, unionism would be difficult to be organized. Trade unions must also realize the importance of not showing submissiveness to these technological advances. Instead they themselves must use the Internet as organizing instruments (e.g. streaming videos, chat, blog, online forum, email, etc.). These modern instruments may be incorporated in a workplace since it is not only the management representatives should be afforded with internal and external communication and opportunity for organization. On the other hand, trade unions should realize that these technological tools would make their lives easier when dealing and finding the emerging actors in industrial relations system.
All told, amidst changing perspectives on work brought about by globalization and technological advances, not only the State and employers face the challenges of reinventing, retooling and retraining in an organization. Employees also experience the suffering or satisfaction of labor flexibility to a greater impact. They need to cope with more exacting workplace which requires no less than competitiveness. One’s knowledge, skills, values and practices nowadays should be honed purposely for work objectives. Employees at large as represented by trade unions may be deemed as recipients of changes at work – driven by internal or external conditions such as, economic environment, quality management innovations and socio-political hegemony. Workers rely too much on trade unions that the latter doesn’t’ have the liberty of time to linger and drown in the age of globalization. Trade unions of today must be fortified with emerging actors in industrial relations system and set aside rivalries once and for all. Dr. Binghay’s call for trade union change must hence remain.

Literature Cited:

Bitonio, Benedicto Ernesto Jr. 2000. “Unions in the Brink: Issues, Challenges, Choices Facing the Philippine Labor Movement in the 21st Century,” (Proceeding of the National Conference on Philippine Industrial Relations on November 18-19, 1999). UP SOLAIR Library.

Bitonio, Benedicto Ernesto Jr. “Workers Representation Amidst Labor Flexibility: Insight from the Philippine Experience.” Department of Labor and Employment. Philippines.

[1] Flexibilization happens when employees resort to range of non-regular and flexible labor and production arrangements in response to changes in the economic environment.

Philippine Economic Growth:
An Art of Deception
And Delusion

“There was of course room for vast deception”
--- Motley


In the ambit of argument, persuasion, defined as appeal in the emotion, can be a practical way to escape from conviction or any appeal to reason. Conversely, conviction has the same effect in shading a persuasive statement. Learning from these concepts, it can be recalled how Gloria Macapagal Arroyo used persuasion in touching the emotions of many just to get away from the “Hello Garci” issue. It can be remembered, that her public apology, although an indication of guilt, had been a clear persuasion in attempt to win back the people’s trust and heart. The countenance of her face in National TV speaks only of remorse. Due to her malicious intent to dupe everyone, the Filipino concept of hiya, pagpapakumbaba, at pagbabagong-loob, which has been entrusted to her by the democratic nation, got tainted.

In one way or another, GMA’s drip affected her future undertakings such as her bragging about the Philippine economic growth of 6%. At first glance, this information may be as sparkling as the Philippine orient pearls but a close examine on this economic report may reveal some deception and delusion – a distressing truth that resides in subliminal level. What now can actually be inferred and expected from GMA’s assertion? Can the Filipino people rely on economic figures alone?





Demystifying Deception and Delusion

As expected, the Arroyo administration would either prove that there has been a simple ascending and descending trend in the statistics of the economy. It would always aver that figures range within the target or it may be compared from the previous year. Unemployment rate for example fell to 7.4 percent in April 2007 from 8.2 percent a year ago. An impulsive acceptance of this data won’t say that much until one can verify that unemployment decreased in NCR above all regions. Apparently, jobs won’t arrive soon in rustic places. Metro Manila, obviously, owes and dictates the source of progress indication. The rest of the economic results are perhaps marginalized in the provinces where the true struggle for progress deteriorates. The location in an economic statistics therefore can do hide limitations.

Aside from this, the importance and impact of determinants such as age (young vs. old), sex (male vs. female), educational attainment (tech/voc vs. professional), industry, and other circumstance cannot be stressed in presenting an economic growth. Say, there are more young employed than that of adults; there are more employed than that of female; and there are more professional employed than that of tech/voc. NEDA could have provided the distribution or deviation across these determinants in a graph to give a better picture of what the rise/fall in statistics wants to imply. Indeed, for the purpose of reporting, the administration laid down raw and vague data which are subject to different interpretation. Hence, unless the attributed report comes out, the statistics remains moot.





Insult of Inflation

True economic growth must be felt by people as the cliché goes. With the 0.3 percent rise in inflation rate as reflected by high prices of fuel, light, water, and other merchandise, the poor doesn’t talk about purchasing power anymore instead, they’d rather deal with survival. It’s futile to blame the demand of the recent national election and fiesta celebrations as the culprit of such an increase knowing that economic liberalization, high fiscal deficits, and among other determinants have already set the destination of inflation rate. Once inflation rate increased, it takes a recession to stoop this. Worse, basic commodities are mostly affected as this hits masa who suffers most in this price hike.

That NEDA reiterates the price growth is within the projections can be taken as bluff since its adverse effects directly concern the wage in question. Needless to say, the 313-350 Php/day wage is way off the 678.54/day cost of living set by NEDA. Perhaps, the NEDA together with DBCC’s (Development Budget Coordination Committee) report [again] is just trying to mollify the ache in people’s pocket. It won’t tell that inflation rise weakens the purchasing power nor commodity prices can no longer be regulated.

Foreign Portfolio’s Ready To Go

Cyberservices have proliferated drastically in the past five years accommodating the big chunk of the unemployed [mostly] from NCR. Contact centers led this leap from their main base [in other countries] to outsourcing [in the Philippines]. It attracted more portfolio investors who would run businesses in the Philippines specially when the country is in good economic and political condition.

Portfolio investors or the so call clients found their niche in contact centers. They usually coordinate with Site Directors of a contact center and later engage in a project-based account. Since the contact centers’ revenue earns capital inflows from foreign firms, the capital account benefits as well. With this, NEDA admitted that foreign portfolio made a huge contribution to the appreciation of the peso against the dollar. Currently, this investment has risen to 5.9 billion from 2.74 billion in the same months last year. BSP Governor Armando Tetangco Jr. even said that portfolio investment can be credited for the recent strengthening of peso as its strongest in almost seven years.

In the late nineties, it can be recalled the Fidel V. Ramos favored this kind of investment as he espouses the principles of "Tiger Cub Economy in Asia" amidst the Southeast Asian crisis. However, in the end, this economy collapsed and left the Philippine currency at its lowest since the country struggled to be industrialized. It also failed to sustain the number of foreign investor due to political instability.

Foreign investments therefore although deemed as good peso booster, have been proven to damage the economy for many reasons. For one, portfolio investors may just leave the country if the political situation seems shaky. This will in turn hang the economy until its free fall because of sudden pull out of investment. In contrary, it is advisable to just get direct investment as it would last and create a more stable business partnership. Another would be, foreign investors act as speculators as well. They’re responsible for manipulating the money flow in exchange rates. They could pull-in and pull-out investments should they find a greener pasteur in other multinational companies.

False Hopes In Employment

Job opportunities emerged as the contact center booms in the industry. Paradoxically, these opportunities may be ephemeral in form since job placements are usually offered by portfolio investors and subcontracting groups which have scattered around the cities. In this case, employees are usually not protected by sudden cease of the project. Foreign employers would usually terminate the employees without affording due process. They (most of the times) rely on interpreting the labor laws by themselves.

On the economic side, temporary employment leads only to fast lay off of employees. This is in contrast of building a strong republic aim of GMA. Workers can hardly find a job which will give them the opportunity to be a regular status as they are entitled to statutory benefits. Moreover, productivity is somehow hampered when the employers put more premiums on termination than retention. The government and private sector should realize that it costs much more to rehire and retrain than keep an employee.

One should not be fooled that supplying more job opportunities alone will foster economic growth in the country. At the end of the day, the quality of job and the duration of one’s employment must be considered as important as feeding the hungry nation.

Economic Figures In The Long Run

Statistics served by the economic measuring bodies may only be beneficial to those who favor the administration when giving figures as only necessary. Going back to the argument of persuasion, GMA can longer appeal to the emotion of the people now that social reality becomes more palpable in respect to the groaning economy. Figures alone will not resolve the issue of increasing temporary jobs, leaving portfolio investors, and rising inflation rate. There might be joy in engaging with foreign investments and competition but it must be emphasized that borrowed token outside the county offers an interim success. For now, no matter how the Philippines has been sold out, the government can only repress the state through deception and delusion.

Work: As Perceived and Experienced In A Relative Context

In his ever phenomenal Manifesto of the Communist Party (1888), Marx divulged the most horrible experience of work in the realm of modern Bourgeoise. The agglomeration of population, concentration of production and centralization of property by the Bourgeoise sustained the exploitative meaning of work – as applied to Proletarians. Thus, wherever there is work, cash nexus exists.[1] It can be drawn from Marx’s idea that human exist to live as people work to live. He even opposed the formulation of minimum wage in that modern Bourgeoise acquire most of the property, while workers struggle to apportion the surplus value – so enough for one to live a day. Paradoxically, since Bourgeoise set the trend of global consumerism, workers nevertheless would give the surplus value back to the centralized production. This has been Marx’s contribution to the definition of work upon realizing the significance of transition from feudal to modern Bourgeoise mode of production. Indeed, his proposal is culturally and historically specific which may be relatively meaningful.

Westwood (1992), on the other hand, deviated from the centric meaning of work. He emphasized that work is not necessarily confined to paid, employed work. Work is important to people on different levels, and varied meanings may therefore be attached to it. In the same way, work can clearly be important materially and economically, but also socially and psychologically. He even extended the attachments to work by relating it to culture, religion, ethics, family, occupation, class, technology, its aim and structure. People, in this perspective, work not for money alone – this however may be identified by looking at the intrinsic (and extrinsic) meaning of work.

On a psychological point of view, employees continue to work if they are so passionate, challenged and fulfilled. This describes the relationship between motivation [inner motivation] and employees’ work. Anne Bruce (1999) even associated motivation with human drives which emanates from biological necessity. She identified motivation as intrinsic and extrinsic independently. She explains that intrinsic factors motivate people from within such as personal interests, desire and fulfillment. Extrinsic factors outside of people conversely influence internal needs, wants and subsequent behaviors such as rewards, promotions and praise. Working for some may be a choice and need not be a requirement to live – this is only true when work means an absolute source of living. Likewise, this doesn’t support the argument that people work to live since there are people who work just to be identified in a social class. Others pursue their passion (e.g. in arts) without worrying about monetary rewards.

While it’s somehow true that most people work to live [which may be just a fragment of truth], it can also be worth noting that some people neither work to live nor live to work. Depending on one’s perception and experience, work can be meaningful or not all as seen from its diverse arguments. Like existence, work is deeply embedded in the process of understanding humanity. Work therefore has its material and ideological meaning.

---

[1] Marx described cash nexus as the monetary relationship between Proleterian and Bourgeoise.

Maximizing The Minimum Wage Fixing
In The Philippines


Much has been created and passed in the legislative body in order to aggregate the minimum wage fixing concerns of various employer and employee representatives in the Philippines. There are labor laws on procedures on wage fixing as far as Republic Act 6727 is concerned. From its general provisions and procedures, labor laws thereby discussed the vital role of tripartite organizations together with the National Wages and Productivity Commission (NWPC) in resolving wage issues. On the other side, minimum wage fixing may be attributed to the concept of social justice to ensure the workers’ protection without prejudice to the employer – who owns the production and labor wage according to Karl Marx. However, these undertakings are considered primarily by the government, one can barely see the fruit of current minimum wage fixing since Kilusang Mayo Uno (KMU), ANAKBAYAN, and BAYAN MUNA, and among other progressive groups continue to question the minimum wage of 350 Php. Many would push through with the issue of living wage instead of the existing minimum wage as the former would allow the people to reproduce life rather than just sustain it. Moreover, there have been proposals that living wage should be set at around 600Php.

With all these in mind, hence, this attempts to examine and reinforce the existing minimum wage fixing in the Philippines. Two reasons should cover these actions: 1) It may not be timely and may be costly for the country to revise its existing laws and programs on wage fixing. 2) Strengthening wage institutions would be a pragmatic way to foster the Philippine value of “Pakikiisa”, “Pakikiramay”, “Bayanihan” and “Pakikisama” on the positive light.

A Question of Praxis on Minimum Wage Laws

While the Labor Code affirms Minimum Wage Fixing in pursuant to R.A. 6727, “An Act to Rationalize Wage Policy Determination by Establishing the Mechanism and Proper Standards” to promote conduct of wage and productivity studies and set standards/criteria for minimum wage fixing, it can never be denied that Wage Orders issued by the Board shall be enforced by the appropriate Regional Office of the Department of Labor and Employment. As always asserted, the government would simply cite these provisions to assure the workers’ ideas are counted. Going back to the issue of living wage, it may be noted that the Philippine minimum wage system supports the Communist’s view on material requirement in order to sustain existence – therefore, a question of “do you live to exist or do you exist to live?”

Paradoxically, 315Php wouldn’t be enough to contain the definition of living wage. Say, an ordinary worker together with his family won’t be able to save an amount of the day now that consumer price index is at high rate – this is not limited to goods only but of services. Apparently, this may not stoop down unless a miracle recession would reset everything else in the economic terms. Thus, pragmatically, the minimum wage [up to 325Php] can only be sufficient for an unmarried person. A married person in an extended or nuclear family can only survived his needs and wants – if tight budget would permit so. Alas, minimum wage in this light will be subjected to constraints considering the criterion of wage fixing to induce industries to invest in the countryside.

Thus, the minimum wage fixing must also be fixated in the central region of the country. If call center employees have already experienced an improvement in standards of living, the marginalized places remain unaffected and uninformed of this information. This weakens the fact that improvements in the standards of living are one of the labor laws’ criteria, in respect to wage fixing.

As regards the prevailing wage levels as wage fixing consideration, it is evident that NCR has the highest wage rate offer as compared with other regions. Urban and provincial wage disparities have been a concern where unequal work opportunities and compensation defeat the purpose of social justice. Wage shouldn’t vary on one location to another alone as this may create resentment and inferiority complex in some labor sector. Prevailing wage as much as possible should be justified for cause and reason therefore as it tries to uplift the standards of living of everyone; if not warranted, prevailing wage must not course of course of the State. Prevailing Wage, hence, must be equated [or least justified] or in proportion with other regions. This might start the change of perception on “minimum wage” as a “cheap wage”. This will further decentralised worker distribution across the islands.

Fair return on capital and capacity to pay of employees and effects of employment generation, family income, and equitable distribution of wealth as other criteria for minimum wage fixing, may not be felt by many workers. However, if employer and employers will work hand and hand with the government, great capital distribution in the society can be achieved. Unfortunately, most employees and employers have not participated and been represented in most labor assemblies as examined as follows:

“Nevertheless, the lack of representational status on the labour side in tripartite bodies, not only weakens its voice on important labour market issues, but denies representation to a large constituency of workers. The challenge for labour, therefore, is not only to overcome this divisive tendency, but to broaden its organizational appeal to all segments of the labour force in order to become a formidable partner in social dialogue”.

Minimum wage fixing, if maximized and used well, may promote a better distribution of labor costs. However, labor laws with regard to this policy must be implemented strictly in order to consolidate the appeal of every employee and as well as the employers. It is through an efficient tripartite cooperation can the labor market be bargained accordingly. As far as the figures would tell, collective bargaining and labor organizations in the Philippines have not reached its maximum number – not strong enough to dictate the labor price. Labor law implementation must be therefore strengthened to enforce the working class and to encourage the employers to take the minimum wage into the living wage level.

A Social Justice Feel on Minimum Wage Fixing

Now that minimum wage fixing can be taken into a higher level of distribution and reinforcement, it can also be integrated in this attempt the importance of social justice as embedded in the Philippine Constitution. Social Justice as defined in the context of State, shall assure the rights of workers to self-organization, collective bargaining, security of tenure, and just and humane conditions of work. Whereas, programs on productivity would be futile without everyone experiencing the equal share of labor, this is to regard the labor organization constraints in the country.

Inherent Filipino values like “Pakikiisa”, “Pakikiramay”, “Bayanihan” and “Pakikisama” and the concept of tripartite, collective bargaining, and to a larger picture, the right to self-organization in the Labor Code are attuned. When proper consultation and dialogue on wage fixing are present in every wage fixing, the government invites a more progressive and experimental way of solving wage differences. In this way, street rallies among trade union organization may also be shunned lest transformed into a positive tone. Wage differences are may be inevitable, but collective ideas can only contain the urge for material.

Government and non-government allies must advocate the role of trade unions and other labor organizations’ in raising the workers’ issues which directly affect wage variation. One of which is health and safety among workers. Call center health hazards, for example, can be highlighted in this concern since employees depriving from sleep not only will suffer a lot repercussions but women working at night pay another legal implications on the other end. Given that call center wages dominate among other industries in the Philippines, its current wage rate doesn’t mean any better when one’s health is at danger. Simply put, goods market when broke can be regained, but labor market when jeopardised can no longer be revived and high wage for the latter is pointless. Hence, wage fixing means social responsibility and encompasses social justice as well.

The Impact of Contact Centers’ Labor Processes

On Philippine Industrial Relations System:
An Experience of Control and Commitment

by Bammer C. Pilar

Abstract

The case study on discipline (control) showed that rules and regulations have been interpreted and implemented differently and inconsistently in a contact center. A survey of 500 Technical Support Representatives (which represent rank and file employees) revealed some “unfair and unequal” exercise of discipline. Contact center’s corrective measures disclosed some violations of due process. Disciplinary notices have been misused while penalties have been imposed inappropriately. These omissions may be linked to business strategies and technological advances (e.g. Call Center Management System). Such compromised disciplinary procedures only contributed to high and flawed attrition [both resignation and termination]. Moreover, foreign clients themselves have indirect contributory actions pertaining to these procedures, principally in the realm of social justice versus employment at will.

Motivation (commitment) on the other hand, did not relate that much to compensation and benefits but of work related and personal issues. Burnout syndrome and search for better opportunities dominated the reasons of employees for leaving the company. Most rank and file respondents emphasized that personal happiness with their peers encouraged them to stay in the firm. Paradoxically, it has been found out that contact center’s management approach to motivation put more premium on profit oriented goal. It nevertheless addressed to strengthen the commitment of employees.

In general, control and commitment as experienced in contact center also offered some inspections on labor market such as workers’ protection against foreign exploitation, employment security, right to self-organization and health concerns.

I. Constant Changes In Contact Centers

The emergence of contact center industry in the Philippines has contributed a lot to changing the employment perspective of most Filipino employers and employees because of its dynamic labor processes. Contact centers, through wage efficiency, offer enticing compensation and benefits packages just to fill the slots of overwhelming manpower needs. Even so the monetary sources are supported by outsourcing profits; the “high salary” offer of these contact centers remains to curb the expenses of companies such as the United States and United Kingdom (OSHC, 2005).

As seen in newspapers, billboards, and among other medium of advertisement, contact centers may have been spending a lot just to invite job applications. It even extended its recruitment strategies by promoting refer-a-friend program and holding social activities. Likewise, schools and malls have been invaded by contact center recruitment teams to hold job expositions. Indeed, although contact centers have been relatively new in the industry, these firms hold the record for being the “sunshine industry” (Hernandez, 2006).

While in actual employee selection, contact centers consider its fast-phase assessment to hit account specific quota. Some centers would as much as possible contain the hiring of labor in one day or may be in a few hours. In order to carry this out, recruitment departments have been compelled to do the evaluation of applicants abruptly. In some cases, the use of technology (e.g. computer operated examination) is just one way to resolve the tempo of selection. This has been somehow the root of quality versus quantity issues of labor at the end of each engagement.

Calls in a contact center may be received or transmitted to the customer of which may be classified as inbound and outbound respectively. Inbound call simply means a customer service representative or a technical service representative receives a call from customers; while outbound agents on the other hand, are sales representatives call up to offer or educate the customers. Calls in inbound are classified and then thrown into different splits or corresponding areas of concerns. “Leads” on the contrary, are what outbound agents consider as customers.

Inbound and outbound calls are not quite distinct in function. A representative for an inbound call may, for instance after resolving a customer’s issue, offer a product or provision. This gives an inbound representative to do an outbound task such as the opportunity to promote, offer and sell. If it so requires, a representative instead of doing an outbound task may transfer the call to the right department or split (e.g. billing, activation and troubleshooting). Likewise, an outbound representative may also attend to general customer concerns but the protocol requires one to transfer the call instead.

An actual call is subjected to monitoring and listening-in by authorized representatives of the company such as Quality Assurance Analyst (QAA), Supervisor (Team Leader for some), Line Managers, Clients and Human Resources Department Representatives. For the purpose of performance evaluation or disciplinary action, calls are usually recorded for reviewing. Sometimes, as agreed upon engagement, the employee should not divulge any information that may be acquired from attending to calls.

Labor transformation occurs differently in contact centers in that it transforms labor through training. While employee selection alone cannot just satisfy some account specific requirements, one has to undergo product training to be ideally equipped as one hits the actual taking of calls in production area or operations. Training phase should purportedly build an agent’s knowledge and confidence as one attends to calls from offshore.

Aside from this, contact centers offer miscellaneous activities and assistance. Company concerts, forums, medical assistance raffle draws, sport fest, corporate social responsibility activities and educational programs intend to boost the employees’ morale and drive – as many would regard as “perks”. However, these may be center or account specific because other perks may not be included in an employee’s package upon engagement.

Resultantly, many workers from non-call centers industry continuously shift toward call center firms in exchange of high compensation and perhaps to seek for better opportunities. Even the state has adjusted to these contact center requirements as it shifted the curriculum of the country’s educational system to focus on English, Math, and Sciences (OSHC, 2005). Some would say that Filipinos’ communication skills can be easily neutralized as compared to other raise. Thus, one’s command of English has to be excellent in industry that becomes more selective in job recruitment. Manifestly, this change in perception and movement pinned on call center industry are realistic and potent. This has been expressed in concrete performance ratings (Hernandez, 2004). Alternatively, call centers have been recently built outside the urban sphere to gear up for a more flexible employment and workplace mobility.

Paradoxically, the attrition rate (resignation and termination), or the number of call center agents who are leaving their companies is at 35 percent, the above 8.3 percent attrition rate the industry has set as acceptable. Thus, the Contact Center Association of the Philippines (CCAP) warned that the labor shortage worsened in recent times. That is, from a five percent hiring rate, call center operators are reporting three percent hiring rate for applicants (Villafania, 2006). Pico (2006) recently sustained this idea that despite contact centers’ lucrative pay packages, attrition runs as high as 45%. This phenomenon however can hardly be explained without closely looking at a specific contact center experience.

II. Significance

The plethora of call center resources in the internet mostly talks about management’s performance, profit, and business opportunity from a foreign point of view. In most articles, it can be read that this industry rises rapidly such that new strategies have been generated to maximize the potential of human capital and the firm’s financial constraints. However, the issue of motivation and control in the industry has not that been tackled yet.

The beginning of contact center research in the Philippines can be attributed to its fresh entrance in the industry. Because of contact center research scarcity in the Philippines, studies have been so far confined in OSH issues (OSHC, 2005) and call center agents’ commitment and willingness to stay in their firms (Manegdeg, 2007). To further the study on commitment or willingness to stay, this research attempts to discuss motivation (commitment) as labor process.

In his study, Manegdeg even encouraged case studies to further investigate on agents’ willingness to stay in a firm. It turned out to be that employees are not so affected by influencing factors such as compensation, employment relationship, incentives and work pressures. Employees supposedly tend to stay if they are so passionate, challenged, fulfilled at work. This describes the relationship between motivation [inner motivation] and employees’ work. Anne Bruce (1999) even associated motivation with human drives which emanates from biological necessity. She identified motivation as intrinsic and extrinsic independently. She considered intrinsic factors motivate people from within such as personal interests, desire and fulfillment. Extrinsic factors outside of people however influence internal needs, wants, and subsequent behaviors such as rewards, promotions and praise.

Conversely on discipline, grievances resolution showed a great deal for employees to stay since employee and employer relationship can either be harmonious or conflicting. Torrington and Huat (1999) further defined discipline as a process of regulating human activity to produce a controlled performance. They include organisation framework of control in the disciplinary system to ensure compliance with the rules and regulations. Three (3) elements may be briefly drawn from this definition:

1) Rules and Arrangements – acceptable to both employer and to the employee

2) Managerial control of individual performance and small group performance

3) Self-discipline – individual control of one’s own performance; where managerial control should provide learning.

Discipline (control) and motivation (commitment) may only be examined in the context of contact center industry’s high attrition rate and fast growth which affects many – the Filipino youth in particular. On the other hand, use of control and commitment strategies in a contact center may unfold either adverse or beneficial effects among employees – which examine the center’s establishment of compensation and performance and disciplinary rules as discussed by Dunlop (1958). Optimistically, this study may be expected to offer a deep understanding of contact center’s labor processes in connection to Philippine Industrial Relations System and its challenges in the local and global stance.

III. General Objectives

This study aims at evaluating the labor processes in a contact center. This paper specifically proposes to:

1. Introduce the company’s profile and its business outlook.

2. Determine the firm’s general policies to elaborate the concept of discipline (list of offenses and penalties and disciplinary procedures)

3. Verify strategies on employee motivation such as in the area of compensation and benefits, key performance indicators, coaching and action plans

4. Ascertain the perspective of management and rank-and-file employees on control and commitment.

5. Evaluate the operations management and employees’ overall perspective on control and commitment.

IV. Methods

A preliminary survey of the firms’ (contact center) labor processes has been conducted to obtain some information with reference to its entire context: recruitment stages, training period, production activities, disciplinary procedures and motivation strategies. To sustain this, company reports have been verified such as company rules and regulations, recruitment’s targets report, Incident Report Database, Weekly Case Status Report, Contact Center Management System, Records Management and Compensation and Benefits Reports. A few confidentiral statistics have been omitted objectively in order not to divulge confidential information.

The study used a combination of survey and personal interview among management representatives in operations and rank and file employees in order to know their perspectives on discipline and motivation. The survey used random sampling of at least ten (10) respondents in order to obtain some perspectives on disciplinary procedures. The respondents have been asked to give at least five (5) words which may be related to discipline (control) and motivation (commitment) separately. They were also told to give their procedures and concept of these key terms. The study then used lexical analysis [a method in psychology of language] to classify and identify the intenseness and range of words given by the respondents.

Five hundred (500) employees’ exit interview forms have been also obtained to measure the reasons for leaving the contact center. These respondents are a mixture of terminated or resigned employees from training period until the actual production phase. Queries in exit interview forms include reasons for leaving the company, management, compensation and benefits evaluation. Consolidated data from the survey have been used to substantiate some points and issues with reference to labor processes in the contact center.

V. Area and Scope

The chosen contact center has currently five (5) sites. For the purpose of this research, the site which currently has 3 technical accounts will be examined exclusively. Technical accounts site runs more than 700 employees. To be more specific in this contact center, the actors as proposed by Dunlop (1958) have been identified distinctively: training phase composes of one (1) Manager, pool of Trainers and rank-and-file trainees. Operations or production floor has four (4) Call Center Managers, seven (7) assistant managers, 770 supervisors and almost 1, 800 Technical Support Representatives (who graduated from training and are deemed as rank-and-file employees).

Other management workforces or support group behind this site and accounts are Quality Assurance Analysts, Workforce Management, Human Resources Department, Communications Specialists and IT Department. These are main subjects in determining and experiencing control and motivation: simply, the managers and the managed.

As regards resources which are available in site, the research focuses to obtain year-to-date or from January to June of 2007 reports. This includes most recent company policies, key performance indicators, appraisal forms, compensation and benefits packages and other ways to control and motivate employees. Past reports however may be mentioned as point of comparison only in order to give a better understanding of company’s labor process through time.

VI. Company Profile: Context of the Contact Center

The chosen contact center was founded in the 1970s in one of the European countries. It aims to deliver better and more profitable customer relationships for both national and international companies. Its contact center network is made up of 179 contact centers which operates 36,900 workstations in 36 countries. The contact center in the USA was founded in 1993 by its CEO. It is ranked as one of the 10 fastest growing contact centers in the US for the past consecutive eight (8) consecutive years. It manages a total of 26 contact centers with offshore locations in Mexico, Argentina, Canada, India and the Philippines.

The Philippine contact center was founded in 1996 as a joint venture between the international contact center and a group of Filipino entrepreneurs. The center in the Philippines is a preferred service provider of major local clients. Year 2003 marked the expansion of this center by servicing the US clients through outbound calls. Year 2004, it expanded to 1,000 + workstations to handle inbound calls from the US. Inbound calls make up to the top industry support that is telecommunications. Year 2005, the contact center handles Internet Service Provider, Computer Software/Hardware and other technological accounts – the second large industry supported by the company.

Employee Engagement: Pre-Employment

The Recruitment team as separate department in the company does the advertisement strategies of employment invitation. It uses media or referral program to promote job applications. They encourage walk-in applicants, thus the recruitment department has been established near a commercial area. This only means that even the contact center recruitment team adapts and considers location as vital business stratagem. The Company recruitment process may be summarized as follows: Initial Individual or Group Interview, Computer Examination for Account 1 and Account 2, Computer Exam, Final Interview and Job Offer. Successful applicants who will make it through the final interview are given hired slips containing the offered salary, pre-employment requirements, and training schedule.

Site Profile

The technical account site was established in 2006. As mentioned, it has over 700 employees at least for operations manpower count. Accounts in site serve for international clients and customers. Operation starts between at 10pm and ends at around 10am, Philippine time.

Status of Employment

Technical Support Representatives (TSR) in all three accounts render services on a project-basis. Thus, the employment is co-terminus with the duration of the account which usually lasts for a year and a few months. The extension or termination of employment would be only prompted in accordance with the employees’ contract and written agreement (refer to the amendment clause of Appendix 2). That is, the contact center may not be establishing regularity within the duration of the project unless determined and agreed upon evaluation.

Task Description

TSRs must be able to meet the requirements and do the responsibilities as stipulated in the project employment contract as follows:

(a) Handle inbound/outbound calls.

(b) Respond to customer calls using product knowledge.

(c) Resolve customer questions and issues.

(d) Work to build customer confidence in the brand.

(e) When applicable, promote opportunities for additional products and services.

(f) Perform such additional work as may be required by the company from time to time under the terms and conditions, and according to the directions, instructions and control of the company.

Other standards of evaluation that may be agreed upon engagement read as:

Table 1: Work Standards of Evaluation

a. Working relationship / Cooperation with co-employees b. Attendance/Punctuality c. Quality of work d. Quantity of work

e. Skills required in the specific nature of work f. Initiative and interest in work g. Leadership h. Obedience i. Aptitude

Training Period

TSR may embark on actual call handling in the production floor after successfully passing training lessons and evaluation. A trainee based on the project employment agreement is allowed only 1 absence or a total of eight (8) hours absence during the training period. A infraction of which automatically subjects an employee to termination. Likewise, a trainee is already deemed ineligible to continue the program in case of poor performance.

Working Hours

Employees in the production floor work for eight (8) to ten (10) hours a day or a minimum total of forty (40) hours per week. This may be scheduled anytime between four (4) to six (6) days a week, from Monday to Sunday. As such, an employee may be on rest day on a Monday and next would be on a Saturday. The contact center determines, changes and reduces the work schedule as exigencies of the project may require for supposedly valid business reasons. At all times, the contact center observes the requirements of law in scheduling work hours. The workforce management together with the mission control team work together in schedule forecasting. This is to avoid manpower curtailment in operations. Both forces tie up to maintain orderliness of call log-in and outs.

Business Outlook

As one of the leading contact centers in the Philippines, it gears up to expanding and establishing new sites not only in NCR but in other regions as well. Like any other contact centers, it has put up one site in Bacolod and now, it aims to capture prospective employees in the southern portion of Metro Manila. This expansion may be attributed to the number of clients investing in the company.

Each account requires a specific number of workstations, type of working place and other related technicalities for the business. Most of the time clients would themselves do the ocular inspection of the site in order to assure the quality of facilities in the production area (e.g. call handlers, personal computers, internet speed and headsets). On the other hand, account clients abroad participate in monitoring and listening in to the calls of TSRs. They also do teleconference with operations managers, Human Resources and Information and Technology Department. This complexity in coordination affects the phase and definition of work in operations. To be more specific, their convention sets call quotas, call flows (step-by-step and standard spiels), product, provisions and metric targets. The communication courses from top management to bottom rank and file employees. Other modes of communication may be through infrequent surveys and exit interviews of resigned and terminated employees.

VII. Company Rules and Regulations: A Whip of Discipline

During the first day orientation, HR practitioners discuss the company rules and regulations and contract provisions among the new employees. All proposals may be signed and agreed by employees at their own volition which pertains to non-adhesion clause. Subsequently, HR practitioners disseminate the company book of rules and regulations to everyone for a common reference, knowledge and acceptance (refer to Appendix 1). HR practitioners would always remind the new hired employees not to dare touch the “hot stove” (violation) for it will cause burn (sanction).

Any violation as documented in an Incident Report or the “show cause notice” goes to an employee’s 201 file for documentation. A calendar quarter prescribes a certain disciplinary action. For example, written or final warning for violation of schedule adherence policy sometime in January will eventually prescribe on March of the same year. If similar offense has not been committed within the calendar period (January until March), on April the lowest penalty may imposed again; for suspension, a longer prescriptive period applies. In some cases the pervasiveness and the gravity of offense will not be saved by the calendar quarter; as such call avoidance and fraudulent are bound to Zero Tolerance Policy (ZTP). For the first violation of such an offense, a recommendation of final warning or termination may be initiated. Major offenses and their corresponding range of sanctions may be categorized as follows:

Table 2: List of Offenses and Penalties

Offense	Penalty
Unsatisfactory Work Performance (UWP)	Written Warning to Termination
Absenteeism (Unscheduled)/ “No Call, No Show” (Without notification) (NCNS)	Written Warning to Termination
VCP (Violation of Company Policies)	Verbal Warning to Termination
Fraud	Final Warning to Termination
Tardiness	Verbal Warning to Termination
Call Avoidance	Final Warning to Termination

Generally, sanctions are as follows:

Table 3: Major Penalties/Sanctions

Major Penalties

Verbal Counseling

Written Warning

Final Notice

Suspension

Termination

Endorsed to HR

Agreements in Memo/Mandatory Commitment

Agreements, since distributed and acknowledged upon engagement, further set the “do’s and don’ts” inside the company premises. From time to time, memoranda are disseminated through e-mail, posters and sign sheets. The management ensures that signed documents find its way to the employees’ respective 201 files (employee’s individual records folder) for future reference. Similarly as mentioned, an incident report incurred by an employee is inserted in 201 file together with other conformed agreements.

The Execution of Employee Discipline

Technological advantage has been embraced by the management for reasons that may be advantageous to both the employer [and clients in one way or another] and the employees. Contact Center Management System (CCMS), is a system tool to address the performance and program issues of the company. One is given a username and password to get access to this system. CCMS Administrator however may or may not allow some access points in the system for a specific user. To further uphold the confidentiality of information policy, other tools may be restricted depending on the user. With CCMS, employees are able to benchmark their own performance (e.g. metrics) while this also offers to track one’s attendance, personal information and employment history (from training to production details).

On the other hand, management and the client use CCMS in order to track employees’ overall progress. Termination and resignation queue of CCMS can readily disable an employee’s access to logins and from taking calls. This queue however may be triggered only by HR Employee Relations upon receipt of proper documentation from the operations (e.g. Incident Reports with attachments and resignation letters) and after observing procedural due process [through employee’s written explanation, Return to Work Order Notice(RTWO), disciplinary conference and Notice of Decision(NOD)].

VIII. Compensation, Benefits and Incentives: A Motivation Package

General company compensation and benefits are contained in a sign sheet called “Annex A”. As such, it includes the basic pay, sign on bonus, attendance bonus, vacation and sick leave earnings and health insurance coverage. The basic pay for a technical account employee ranges from 15K to 16K Pesos (subjected to government mandated taxes) depending on one’s call center experience. At least 6 (six) months of stay from previous contact center is considered a valid experience. Granted upon passing the training period, an employee receives 2, 500.00 Pesos of sign on bonus. Another sign on bonus of 2, 500.00 Pesos is given after 60 days from date hired.

Because management so desires that attendance policy is adhered, it entitles an employee a 3, 500.00 Pesos monthly attendance bonus (AB) if the following conditions are met in production (or technically successfully passing the training period): 1) staffed time or equivalent to 160 work hours are completed without filing a vacation 2) perfect attendance is defined as having only 1 count of tardiness which should not be more than thirty (30) minutes into their shift, no under time and no absences for one month in production based on the payroll cut-off dates as defined by the Accounting Department. 3) Tardiness, under time or absence due to natural calamities or emergency cases are considered as exempt and will not forfeit an employee’s claim for attendance bonus if supported by documents (e.g. hospital records and death certificate). 4) Such emergency cases are deducted from an employee’s vacation leave credits. 5) Vacation leaves will not forfeit an employee’s eligibility provided that the vacation leave was filed and approved one week before the intended 6) Filed sick leave generally forfeits one from receiving the attendance bonus.

Vacation Leave credits are earned at the rate of 1.25 days per month from date of hiring. A fraction of leave credits earned computed from the date of hiring may be availed by the employee upon completion of 6 months service up to 31 December of the same year and the other half upon a year of employment. In contrast, 15 Sick Leave credits are earned after a year of employment. Thus, qualified employees are required to schedule 2/3 of their respective vacation leave credits for the calendar year before 1 January of each year. The employee’s Department Manager has the prerogative to adjust the employee’s VL Schedule according to the operational requirements of the department. The following scheme applies for Vacation Leave:

Table 4: Vacation Leave Scheme

Month of Hire	Month of Regularization	VL Credits Upon Regularization	VL Credits for Year 2*	VL Credits for Year 3 onwards
July	January	7.5	15.00	15.00
August	February	7.5	13.75	15.00
September	March	7.5	12.50	15.00
October	April	7.5	11.25	15.00
November	May	7.5	10.00	15.00
December	June	7.5	8.75	15.00
January	July	7.5	7.50	15.00
February	August	7.5	6.25	15.00
March	September	7.5	5.00	15.00
April	October	7.5	3.75	15.00
May	November	7.5	2.50	15.00
June	December	7.5	1.25	15.00

*VL credits in addition to leaves carried over from the first year.

Aside from Social Security System (SSS) and Philhealth entitlement to different kinds of loan and hospitalization, the company has engaged in health maintenance organization. This covers employees’ with health benefits except for pre-existing conditions and other disease not covered by the health company. A corresponding insurance is given to an employee as a tenure benefits which amounts to 100, 000 Pesos or more depending on rank and position.

Key Performance Indicators

Technical Support Representatives’ (TSR) metrics or score requirements relatively vary from those of Customer Service Representatives’ (CSR) and Telesales Representatives (Outbound/Sales). Although, these representatives should all comply with the Call flow procedures (from greeting to closing remarks), Average Handling Time (AHT), Customer Treatment, and Transfer, TSRs are more expected to resolve technical issues with little emphasis on handling time. This simply describes the importance of resolution in every call to avoid customers from calling back [First Call Resolution (FCR)].

It is during the training that the target scores must be attained by trainees: 40% Call Quality, 25% Communication, 15% Attendance, 20% for product simulations and other requirements. Conversely, TSRs in the production area are expected to be so knowledgeable of the account’s products. This necessitates that TSRs should have product knowledge which combines with excellent communication skills and unrelenting customer service. Call avoidance, illegal call transfer and rudeness to customers therefore are just some negations of the aforementioned good qualities. It is expected that TSRs can accommodate more or less than 50 calls in just a shift and are able to email or document customers’ issues in the call summary – which may be mailed electronically or informed to a supervisor in case of irresolution.

To reward the performance of an employee, an appraisal scheme applies as follows:

Table 5: Performance Appraisal Scale

1	2	3	4	5
Unsatisfactory Performance	Improvement Desired	Meets Expectations	Exceeds Expectations	Outstanding Performance

Table 6: Performance Appraisal Attributes

Dependability

Initiative

Job Knowledge

Problem Solving

Productivity

Quality

Interpersonal Skills

Teamwork

Work Environment

Attendance and Punctuality

Each attributable has a corresponding grade based on scale, abovementioned. The average of these ten (10) attributes must have a corresponding basic salary on the following scheme:

Table 7: Equivalent Salary Increase of Performance Appraisal Rating

Rating	Equivalent Annual Basic Salary Increase
> 4.49 <>	12.50%
> 3.99 <>	12%
> 3.49 <>	10%
> 2.99 <>	8%
2.99 & below	no salary increase

Action Plan and Coaching Strategies

Boosting the performance of employees is just one of the responsibilities of supervisors and managers in operations. This usually happens anytime if so needed. Supervisors may for example track and coach TSRs as regards the number of resolution and handling time before, during, or after a call. Since calls are monitored by supervisors and Quality Assurance Department, results of a call can be accessible for future coaching. Furthermore, at the end of shift, “haggle” on the other side, is another way to gather a team and discuss some areas for improvement with supervisor or managers. Most of the time, instructions among TSRs are done verbally otherwise documented for corrective action.

Non-Monetary Compensation

In most occasions, whether it may be a foreign or Philippine holiday, the contact center holds a company wide event to satisfy all employees. These include but not limited to raffle draws, performance competition, yearly sports activities, parties, concerts, freebies giving and food treats but employee recognition as well. Those who have remained in service for 5 years are rewarded a token, company watch, or cash; while those who exceeded company’s expectations are recognized. Moreover, team buildings are equally encouraged and supported by management. This aims to give employees time to celebrate, recreate and bond with teammates.

Other non-monetary compensation may be drawn [indirectly] from: 1) amenities provided by the company such as shuttle service, 24/7 employee lounges (e.g. sleeping quarters, karaoke, arcade, fitness gym, billiard and darts) and food services. 2) Room for promotion in production since the movement on the floor is fast. 3) Social responsibility program that will somehow make the employees realize their potential to help those who are less in life.

IX. Findings and Discussion

Perspectives and Issues on Control (Discipline)

Rules and regulations in the company code of conduct and good behavior specifies how the management representatives should go about the disciplinary process. It embodies major provisions of the Philippine Labor Code on labor relations. It must nevertheless be noted that there are conflicting perspectives as regards its implementation and interpretation.

First, penalty should follow the verbal, written, suspension, final warning and termination progression. In most cases, one of these has been omitted to speed up the dismissal of employee. Based on company rules and regulations, the contact center intends to incorporate some business outlook into the realm of employee discipline. From list of offenses and penalties, the progression of discipline skips suspension to warrant the employee’s termination. Operations would as much as possible not allow an employee to linger during the days of suspension as this will add to unproductively. Huiskamp through Barbash (1995) described this type of employment relationship as management’s cost efficiency principle while employees tend to control costs (since guided by social principle).

As observed in an Incident Report serving procedure, an employee is given a written warning without giving an employee a chance to be heard; the show cause notice goes directly into an employee’s 201 file for documentation for future reference. Thus, an employee who received the Incident Report for a minor offense [say] didn’t have the chance to contest what was pre-judged by a superior. There was also an instance when a superior would serve a second Incident Report of insubordination when one just refused to sign the first report. A further examination on this, discloses eight (8) out of ten (10) management representatives doesn’t realize that an Incident Report or any show cause notice is merely an allegation. Thus, corresponding attachments (pieces of evidence of evidence) should be submitted together with an Incident Report to support the allegations (e.g. computer screenshots, call audio files, video recording, evaluation sheet, written commitment, coaching sheets and action plan).

Second, seven (7) out of ten (10) employees consider an Incident Report a “threat” and not a corrective stimulus since no or insufficient coaching is given prior to its service. Most of them suggest that management should promote “fair and equal” treatment among employees regardless of rank and position. Most TSRs are also discouraged when an Incident Report stays in their 201 file, thus may affect their future undertakings (e.g. job application in other firms or job bid for a higher position). The “clean slate” action or exclusion of Incident Report in one’s 201 file after the commission of an offense has prescribed, never happens physically as inspected in the records section. Hence, during job bid applications, the disciplinary history is yet mentioned. In a larger scale, those who were terminated can no longer reapply for the same account in other company because of “black listing” system initiated by the clients themselves. The Contact Center Management System allows clients and management partners alike to track an employee’s history [which makes it easy to decide whether an employee is eligible for rehire or not without referring to the 201 file].

Third, coaching for performance related issues and other minor offenses may be abrupt in the contact center. The idea that clients will not be satisfied if the overall output of the site fells short of the targets led most supervisors to presume the termination of an employee. Some Incident of Reports as seen in the database confirms a short interval of show cause notice issuance – usually it takes more or less than a week before another Incident Report is served to an employee for a similar or different offense. This occurs when management and clients forces TSRs to produce a satisfactory outcome in no time. An Incident Report issuance is abused in order to put more pressure among the rank and file employees. In the same way, operations management strictly tracks the number of absences and tardiness per occurrence to avoid further loss in revenue. Unfortunately, the amount of loss as stipulated is not so defined by the management.

Fourth, instead of serving an incident report per occurrence, it became a habit for some supervisors to pile up all the offenses and served them at once in a report [since most Incident Reports therefore are used to supposedly boost the performance of employees because of its threat element]. This has become bad faith on management’s end for not observing the progression of discipline that is, the imposition of a lowest penalty prior to a higher sanction.

Fifth, the culture of fast-phase movement in the contact center affected its corrective action procedures unjustifiably. Approximately 2,000 Incident Reports filed in the Human Resources Department as of June 2007 only proves that the use of show cause notice is hyped. It has been noted that even the use of penalty should be inspected and corrected such as Preventive Suspension which rises to almost 80. It must be realized that an employee may only be placed under Preventive Suspension if his continued employment poses a serious and imminent threat to the life and property of the employer or of his employees.[1]Therefore, Preventive Suspension should not be imposed for minor cases such as violation of call standard procedures of TSRs. This penalty may be too harsh for a rank and file employee who was not reposed trust and confidence unlike those of management representatives. Equally, an estimated 220 pro-forma notices or one-page termination (in contrast with the twin notice rule) during the training period, in the middle of the year also shows the statistics of termination without procedural due process.

Sixth, (as almost related to the fifth finding) technological advances like use of Contact Center Management System (CCMS) may be feared to be speeding up the lay-off process of employees unlawfully. Supervisors or Managers can just click on the termination queue of the system to disengage the login of employees even due process has not been afforded yet to an employee. Any pieces of evidence like scorecards or even resignation letters must be presented first to the Human Resources Department to prove an allegation.

Lastly, there exists an invisible ideology of “employment at will” in operations management. HR practitioners admitted that they face challenges with foreign representatives: one (1) Site Director and three (3) Account Managers. Series of labor orientation have been so far conducted by HR practitioners in order to rectify some dissonance between foreign and local ways of labor management. The results of these orientations can only offer a few remedies in that foreign management representatives report directly to those foreign clients through telephone or video conference. The clients themselves as mentioned are involved in disciplinary actions. Their involvement adds pressure on line managers to enforce penalties which often conflicts with existing rules and regulations. Consequently, HR Employee Relations staff and external lawyers act as fire extinguishers of full blown cases which continue to pile up outside the State’s quasi-judicial bodies. As a result, NLRC cases of the firm thus run from 5 to 7 on the average.

Diversity in Discipline

Inconsistencies in corrective actions are imposed differently during training period and in production stage. The provisions in the employment contact states allow trainees to be absent once or a total of eight (8) hours. The Training Department explicate that the account can not make up for the trainees’ absence as the main cause of manpower supply delay. In addition, one’s failure of major examination during training merits termination for the first offense. If a trainee has a valid reason or appeal for an excessive absence, the management resorts at either rescheduling (for another batch of training and putting an employee on floating status) or transferring an employee to another technical account. Worse, (which happens most of the time), terminating an employee is the last remedy.

Resignation/separation by an employee during the training period and some cases in production may be granted however the 15-day notice is waived. This gives employees an idea to leave the company anytime soon beside the fact that the contact center had put aside the employment bond during training. Thus, the resignation went up as high as that of termination during training. For the month of June 2007, attrition during training is 193 over 740 new hire as shown below:

Table 8: Total Attrition on Training Period

May 27-June 23, 2007 Attrition	Resignation	No Call, No Show		Termination	Total Attrition
TRAINING	14		0	13		55

A closer look into the termination process during the training period reveals that due process is blatantly violated. After an Incident Report has been served to a trainee, who allegedly failed a major examination, a pro-forma (one page notice) termination is readily issued. It doesn’t’ adhere to the twin notice requirement as stipulated in Articles 277 and 279 and of the Labor Code. The Philippine Constitution in Section 3 of Article 13 so declare that State shall afford protection labor as embodied in the social justice principal. Samson (2004) moreover reiterated the in case of doubt, Supreme Court shall decide in favor of labor and this has been already exemplified in many jurisprudence.

Also, the question of quality vis-à-vis the quantity of hired employees of Recruitment Department may be blamed since most trainees fail the basic subject in training – the US 101 class. Recruitment officers, since quota at the end of the day has been set upon them, hire more just to fill the manpower needs even the qualification of hires is compromised. The company spends more and more for new hires since attrition rate won’t stop from rising. It could somehow consider efficiency wage to minimize its cost per effective unit of labor employed (McConnell, 1999). The graph shows how the year-to-date hires of the contact center (see comments below):

Table 9: Recruitment’s Monthly Hires

Month	Applicants 2007
January	1813
February	1657
March	1956
April	2207
May**	4328
June*	5301
July	5634
August	4641

*A technical account for the month of June averages 33 hires per week.

** On May, the said account even fell short of 2 more hires.

In contrast, the management only observes due process on endorsed cases from operations. On a weekly basis, there are at around 50 endorsements for termination. In a Weekly Case Status Report from June to September, the site yields more or less 31 cases, all coming from training and production.

The case statistics may be unusual as it fluctuates from time to time. Closed cases – classified as termination, reinstatement, suspension, or resignation – averages at 23 while it leaves more or less 8 pending cases. Three (3) of which are issues of Call Avoidance, eleven 11 No Call, No Show, and 17 cases of performance related issues. In 4 months there are at least 2-3 constructive/illegal dismissals as identified by HR Employee Relations team. These dismissals and labor management challenges mainly happen due to the following circumstances:

1. Lack of labor relations management skills and orientation among supervisors and even line managers.[2]
2. Lack of coordination of operations management with HR practitioners.[3]
3. Uncontrolled disciplinary procedures in production due to its large scale[4]
4. Personal rivals in production where low performers are isolated.
5. Client pressures that an employee should be removed from the account as soon as possible even only an Incident Report has just been served or even at the show cause notice stage.
6. Pressure arises when supervisor have to force TSRs to hit the scores/metrics as soon as possible [as mandated].
7. Diverse perceptions on discipline between management and rank-in-file employees.

A survey among management representatives links discipline with carrying out the company rules and regulations in order to correct an employee’s behavior. Lexical analysis reveals the language of management as regards discipline barely gives a humane treatment but of standards and convention (refer to Table 10). Words like rules, policies, process, order, restraint, decorum, proper, requirement and principles may be described as rule-based or “by-the-book” in nature. These words evidently dominate the perception on discipline. Support, self-control and acceptance which are less emphasized may be taken as sounding humane and light in nature.

Table 10: Management's Associated Words With Discipline

Certainly, words coming from management representatives themselves reinforce dissatisfaction avoidance-hygiene (KITA) factors of motivators mentioned by Herzberg (2003). According to Herzberg employees tend to dislike these factors such as the idea of company policy and administration, supervision, interpersonal relationships, working conditions, salary, status and security.

Perspectives and Issues on Motivation (Commitment)

Willing To Stay: A Non-Monetary Drive

Basic salary rate of TSRs is relatively higher than those of CSRs. There can be no doubt that money can be a good source of motivation among employees. In the case at bar neither salary alone nor benefits package (e.g. health insurance and vacation/sick leave credits) and amenities motivates the employees to stay in the company. Their commitment to work may be reflected on the following responses as seen from exit interviews of 500 employees who resigned or may be terminated by the company:

Table 11: Six Major Reasons for Leaving the Company from 500 Respondents

Better Opportunities	Pursue Studies	Personal and Family Matters	Work Issues	Health Reasons	End of Contract
84	65	99	81	76	95

Ninety-ninety (99) respondents top the reasons for leaving the Company which may be due to personal reasons. This may also be attributed to location problems and family matters. Personal matters and better opportunities categories even so correlate respectively. Search for better opportunities and personal reasons include some employees who leave the company in exchange for better compensation and benefits package, sound management (without “dirty politics or biases”), better relationship with superiors and new environment/profession.

With reference to health reasons, survey shows that burnout syndrome as the primary cause of employee departure from the company. The second cause for leaving are those diagnosed employees as having low-blood pressure and hypertension. Lastly, work issues as catalyst for leaving have been attributed to those employees who/with: 1) have a pending case 2) have been treated unfairly in production 3) haven’t seen any room for career growth 4) have issues with superiors 5) have been discouraged by poor working environment 6) have been affected by erratic work schedule (split rest days/mandatory overtime). These are just some challenges for the management to look into in order to strengthen the employee’s commitment at work and in the company.

Performance Indicators and Appraisal: Challenges In Work Organization

Model of work organization as depicted in the center challenges the employees’ performance indicators and appraisal. Call center organization identified by Batt and Moynihan’s (2002) matches the company’s adoption of professional service production model. Two elements are equally important in this model: 1) customer management and 2) consistent service quality. Since the site has three (3) technical accounts, the work organization puts more importance not on sale but customers’ issue resolution and professional service orientation.

Performance indicators and appraisal may be quite broad and different from what is required on production. TSRs in production focus more on issue resolution while performance indicators require them to meet, exercise and show attributes: dependability, initiative, job knowledge, problem, solving, productivity, quality, interpersonal skills, teamwork, work environment, attendance and punctuality. Fair enough for some to consider these attributes but objectivity and broadness of appraisal should not invite score manipulation. To resolve this, it would be better for the management/supervisors to attach scores of employees for further justification.

Epico (2006) mentioned that two most considerations in the call center labor process are 1) the quantity of calls 2) the quality of the agent-customer interactions. Peer scores can also be good way to support the weight of scores. On the other hand, “weaknesses” and “strengths” at the last portion of the appraisal form must only be discussed well. Clarifying and explaining these expectations to the employee may be one way to avoid “unfair and unequal” treatment before and after the assessment.

It has been noticed that supervisors serve the performance appraisal quickly without laying expectations down and explaining the scores to the employee. Torrington and Huat’s (1999) appraisal may be adopted in order to resolve this concern. In their performance appraisal interview discussion, the following steps may be considered: 1) Appraisee briefing 2) Encounter (factual review and positive reinforcement) 3) Joint Action. They also emphasized that rapport with the appraisee should be established first where listening and throwing some open-ended questions could lighten up some expectations or score interpretations.

Moreover on commitment, most TSRs enjoy their stay in the contact center because of their peers. Five (5) out of ten (10) prefers to remain as TSR and not get promoted since they get bonuses and over-time pay with lesser fatigue that those supervisors who would extend their stay beyond their regular working hours just to finish some administrative tasks: payroll, attendance sheet, supervisor’s packet and reports. Some of them appreciate the fact there exists no employment bond but they see themselves leaving the company at their own convenience. The fact that there are other contacts centers around makes them feel secured to eventually leave their posts.

Based on lexical analysis, the management’s language of motivation is depicted in Table 12. Words such as goals and leadership reflect the management’s idea of motivation on the broader side; while, feedback, dedication, reason, excitement, eagerness, drive, rewards and inspiration best explain motivation toward an individual needs.

Table 12: Table 13: Management's Associated Words With Motivation

Although the company has been treating employees with bonuses, concerts, food treats and sports activities, it has been noticed that it lacked special learning opportunities. Ann Bruce (1999) suggested training, seminar and workshops to encourage personal and professional development – and often increases motivation as well. These suggestions may somehow tell that employees are given more opportunities to use their new skills. On the contrary, TSRs have standard spiels and do redundant actions which promotes little to no learning at all.

These tools may be used by the contact center in resolving the attrition rate. It has been found out that no retention program or succession planning has been established by the management in order to keep the employees. The idea of “commitment” as shown by the analysis can only be reflected indirectly on “dedication”. Motivation in the contact center, however, is still profit oriented which in contrast, doesn’t address to what the employees are responding in respect to their concept of commitment.

X. Conclusion and Recommendations

The concept of discipline (control) in the contact center reflects misuse and misinterpretation in procedures. Management representatives use Incident Reports to regulate employees’ activities to produce a controlled performance however threatening, fast, and [sometimes] malicious. This departs from the essence of training and coaching which should be done progressively. Alas, lack of coaching and action plan contributes to high attrition of the company.

The presence of alien employees in the management group, clients and Contact Center Management System (CCMS) as technological agent influence the operations’ perspective on discipline [and even motivation as well]. Instances when supervisors and managers who terminate an employee CCMS during the investigation stage should be stopped. The use of this system must be calibrated with proper disciplinary procedures.

HR practitioners currently try to penetrate and harmonize foreign conflicting labor process with that of the Philippine Labor Code provisions in the center. Perhaps, the meaning of social justice and International Labor Organization’s (ILO) work regulations (as well its declaration on freedom of expression and association) ILO must be reiterated to resolve these conflicting ideologies. Although business outlook and profit-making may be equally important in the contact center, it must not compromise with humane working conditions. Such justifications on mandatory overtime, break schedule, and work environment may be brought into light.

Regulation of alien employment in contact center may be tackled as well in future case studies. Torrington and Huat (1999) exemplified application of levy on prospective foreign employees in Singapore. Articles 12, 16, and 269 in the Labor Code have been so provisioned to regulate alien employment in the country. Thus, it would be better if the contact center inspects its alien employment/client organizations. Management may go over the rights and limitations of alien employees [if the Secretary of Labor has so granted them permit] to avoid Philippine labor laws circumvention.

Besides substantive and procedural due process, management authorities may also incorporate disciplinary interview during employee coaching (Torrington and Huat, 1999). Disciplinary interview as suggested includes 1) collecting of evidence 2) statement of the facts 3) Following up the interview. The center must apprehend that employee discipline means shared responsibility by operations management, HR practitioners and rank and files employees collectively. Conversely, fast work environment can never be an excuse to omit some provisions on labor’s right to be heard during coaching, warning, and imposing of sanction. It has also been noted that there exists no appeal clause in the contact center’s employment contact once a Notice of Decision (NOD) has been served.

The results of TSRs’ response on motivation (commitment) agree to Manegdeg’s (2007) conclusion that employees’ willingness to stay may not be influenced by compensation, employment relationship, incentives and work pressures. It can be recalled that willingness to stay according to him braces up if employees work passionately with challenge and fulfillment. Epico (2006) supported the idea that “burnout” is not a remote possibility which concerns employees’ quality of life. TSRs in the contact center can nevertheless achieve passion, challenges, and fulfillment if 1) grievance machinery has not been established yet 2) room for learning doesn’t break their repeated/redundant actions in production 3) the nature of job has taken its toll on their health 4) coaching means abruptness and disciplining posts threat, inconsistencies, and omission of due process 5) and performance indicators and appraisal scheme may not be aligned with operations and work organization.

From this specific contact center experience, some issues in Philippine labor market as discussed by Epico (2006) have been supported by this case study. First, contact center employment has been deemed as recruiting people with excellent communications, customer service, and technical skills. This study however shows that burnout out syndrome among TSRs proves Taylor and Bain (1999) research that routinization, repetitiveness, and general absence of employee control have become salient features of the call center labor process. This challenges contact centers to foster a different learning experience among employees who suffer the monotony of taking in calls.

Second, the study strengthens Epico’s observation that problems and objections of labor process has met in onshore locations in developed countries have been also seamlessly exported in the Philippines. It must be emphasized though that this exportation goes beyond workflows but [perhaps] diverse disciplinary beliefs as well [deliberately or not]. Third, high attrition may not be blamed solely on pouching of recruitment staff, exhausting job experience and staying temporarily tendency (parking) of employees. Covert and inappropriate disciplinary and motivation procedures in a contact center could also be one of the reasons for high attrition – which might concern contact center labor sustainability in the future.

Lastly, the study openly accepts the idea of promoting workers’ right to self-organization – as supported by Articles 234, 243, and 251 of the Labor Code. Unfortunately, the contact center’s employment contract doesn’t declare about employees’ right to self-organization. There might be other hidden concerns in a contact center which could only be obtained through employees themselves – if only they have an organization to rely on. Certainly, cooperation among the actors of industrial relations (the State, manager and employees) has a significant role in resolving these contact center’s challenges.

XI. References

Books

Batt, R. & Moynihan, L. (2002). The Viability of Call Centre Production Models. Human Resource Management Journal, 12(4), 14-34.

Bruce, Pepition. 1999. Motivating Employees. USA: Mc-Graw Hill.

De Leon, Hector. 1997. Textbook on the Philippine Constitution. Quezon City: Rex Bookstore.

Dunlop, John. (1958). Industrial Relations System. Boston: Harvard Business School. p. 43-132.

Huiskamp, Rein et al. 1995. “Regulating the Employment Relationship: An Analytical Framework,” in Comparative Industrial and Employment Relations. p. 16-37.

Mconell, Brue, et al. Contemporary Labor Economics. 1999. Singapore: McGraw-Hill.

Miranda, Gregorio. 2000. Labor Management Relations. Navotas, Metro Manila: Navotas Press.

Ober, Nicholson, Herzberg.et al. 2003. Harvarrd Business Review on Motivating People. USA.

Samson, Anna Rhea. 2004. Working With Labor Laws. Quezon City: Ateneo De Manila Press.

Torrington and Huat. 1994. Human Resource Management For Southeast Asia. Singapore: Prentice Hall.

Journals

Priyatna, Sale, Sarmiento, et al. 2005. Philippine Journal of Industrial Relations. Vol. XXV, Nos. 1&2.

Teodosio, Macaranas, Binghay, et al. 2006. Philippine Journal of Industrial Relations. Vol. XXV, Nos. 1&2.

Article, Papers, and Reports

Bitonio Jr., Benedicto Ernesto. 2007. The Changing Nature of Work in Asia: The Philippine (Globalization and Work in Asia). UP SOLAIR: Chandros Publishing.

Hernandez, Deanne. 2004. Challenges for Call Center Industry. Philippine Daily Inquirer. p.17.

Villafania, Alexander. 2006. Call Center Labor Shortage Bearing Down On RP. Philippine Daily Inquirer. p.13.

The Occupational Safety and Health Center, Department of Labor and Employment. 2006. Case Study on the Health and Working Conditions in a Contact Center. UP SOLAIR library.

Unpublished Materials

Manegdeg, Reynold. 2007. Study of Call Center Agents’ Commitment and Willingness to Stay. UP SOLAIR library.

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[1] Section 8, Rule XXIII, Book V, Omnibus Rules Implementing the Labor Code.

[2] Also, fast promotion in operations means another labor orientation for new management members. It takes some time for management novices to balance some ideas in operations and labor relations.

[3] As observed, the separation of HR practitioners’ rooms/floor from the production floors adds up to organizational barrier.

[4] Refer to the company profile as mentioned.