Philippine Labor export as Government policy

Posted by Belarmino Dabalos Saguing

Rome, Italy 22 October 2014

From the aticle The Philippines' Culture of Migration 

by Maruja M.B. Asis  JANUARY 1, 2006

Historical Background

After more than three centuries of Spanish colonial rule, the revolution waged by Filipinos in 1896 almost led to the end of Spanish rule. After a year of fighting, the revolutionaries and the Spanish authorities signed a truce in December 1897, and General Emilio Aguinaldo went into exile in Hong Kong.

The Spanish-American War broke out in February 1898, sparked by the United States' support for Cuba's fight against Spain. This spilled over into the Philippines. An American fleet led by Admiral George Dewey arrived in Manila, defeating Spanish forces in the Battle of Manila Bay on May 1, 1898.

Upon the urging of Admiral Dewey to resume the fight against Spain, General Aguinaldo returned to Manila on May 18, 1898. General Aguinaldo's forces liberated several towns south of Manila and declared independence from Spain on June 12, 1898. More American forces arrived, and the Spaniards surrendered Manila to the Americans that August.

On December 10, 1898, the Treaty of Paris was signed between the United States and Spain, formally ending the Spanish-American War. Under the treaty, the United States paid Spain to take control of the Philippines. Cuba, Puerto Rico, Guam, and the Mariana Islands were ceded to the United States as well.

Filipinos resisted American rule, and the ensuing Philippine-American War, which began in 1899, dragged on even after it "officially" ended with the capture of General Aguinaldo in 1901, followed by the establishment of a civil government throughout the Philippines in 1902. The Philippines became independent in July 1946, after the Japanese invasion and occupation of World War II.

For much of the 20th century, "international migration" for Filipinos meant going to the United States and its Pacific territories. The first batch of Filipino workers arrived in the U.S. territory of Hawaii on December 20, 1906 to work on sugarcane and pineapple plantations.

More workers, mostly single men, followed; others left Hawaii to work in agriculture in California, Washington, and Oregon, or the salmon canneries of Alaska. On the mainland, low-wage service work in the cities — waiters, busboys, or domestic work — provided alternative jobs between agricultural seasons or when other jobs are not available. Some 4,000 Filipinos were employed in the merchant marine, but this employment possibility ceased with the 1937 passage of a law requiring the crew of U.S. flag vessels to be at least 90 percent American citizens.

According to one estimate, approximately 120,000 Filipino workers came to Hawaii between 1906 and 1934. Another estimate puts the number of Filipinos arriving in the United States between 1907 and the 1930 at 150,000, the majority of whom were in Hawaii. A small number of scholars, known as pensionados, also immigrated to the United States before the 1920s. They were either sponsored by the U.S. government or by missionary-related programs. Some were sent by rich families to study and a few were self-supporting students. Those who returned assumed important positions in Filipino society while others remained in the United States.

Because the Philippines was a U.S. colony, the movement of Filipinos to the United States was considered internal migration and Filipino migrants were "nationals" (but not citizens). It was not until the passage of the 1934 Tydings-McDuffie Law (also known as the Philippines Independence Act of 1934), which provided for the granting of Philippine independence in 10 years' time, that the Philippines became subject to immigration quotas. The 1934 law limited the Philippines to 50 visas per year, and migration dropped off dramatically.

But even so, there was an exception clause: in case of a labor shortage, the governor of Hawaii was authorized to hire Filipino workers. As nationals, Filipinos were entitled to American passports and could enter and leave the country freely. World War II intervened and further migration to the United States stalled. Between 1946 and the mid 1960s, about 10,000 to 12,000 Filipinos came to Hawaii as workers, military personnel, and war brides.

It was not until the 1965 Immigration and Nationality Act, when nationality-based restrictions were struck down, that Filipino immigration grew and diversified.

Other countries of settlement also dismantled their pro-European immigration policies in the 1960s and 1970s, paving the way for Filipinos to enter Canada, Australia, and New Zealand under family or skills-based provisions. The Philippines eventually became one of the top 10 sending countries in these traditional immigration countries.

Filipinos also settled in countries that are not traditional countries of immigration, such as Germany and Japan, through marriage or work-related migration. This permanent migration, however, was overshadowed by the larger and thornier temporary labor migration that started in the 1970s.

Becoming a Labor Exporter

The Philippines' ascent as a major labor exporter in Asia and worldwide is based on various factors. When large-scale labor migration from the Philippines started in the 1970s, the "push" factors were very strong but made worse by the oil crisis in 1973. Among others, economic growth could not keep up with population growth. The country was hard pressed to provide jobs and decent wages and had severe balance of payment 

problems.

At the same time, the oil-rich Gulf countries needed workers to realize their ambitious infrastructure projects. With supply and demand factors converging, the Philippines was ripe for large-scale labor migration, an opportunity the Marcos government recognized. The framework for what became the government's overseas employment program was established with the passage of the Labor Code of the Philippines in 1974.

The Philippines' foray into organized international labor migration was supposed to be temporary, lasting only until the country recovered from its economic problems. However, the continuing demand for workers in the Gulf countries and the opening of new labor markets in other regions, especially in East and Southeast Asia, fueled further migration.

On the supply side, the push factors have not abated. The absence of sustained economic development, political instability, a growing population, double-digit unemployment levels, and low wages continue to compel people to look abroad.

The flow of overseas foreign workers (OFWs), numbering a few thousand per year in the early 1970s, has grown to hundreds of thousands (see Table 1). In 2004 alone, 933,588 OFWs left the country. Based on trends, it is expected that the number of deployed OFWs will hit the one million mark in 2005.

The data on deployed workers include seafarers, who account for some 20 percent of all OFWs leaving the country every year (see Table 2). Filipinos dominate the industry: 25 percent of the world's seafarers are from the Philippines.

As of December 2004, the stock of overseas Filipinos include some 3.2 million permanent settlers (the majority of whom are in the United States), about 3.6 million temporary labor migrants (called OFWs), with Saudi Arabia hosting close to a million, and an estimated 1.3 million migrants in an unauthorized situation. The latter tend to be mostly in the United States and Malaysia.

Women are very visible in international migration from the Philippines. They not only compose the majority of permanent settlers, i.e., as part of family migration, but they are as prominent as men in labor migration. In fact, since 1992, female migrants outnumbered men among the newly hired land-based workers who are legally deployed every year.

The majority of female OFWs are in domestic work and entertainment. Since these are unprotected sectors, female migration has raised many concerns about the safety and well-being of women migrants. Female OFWs can also be found in factory work, sales, and nursing.

Among the top 10 destinations of OFWs, Hong Kong, Kuwait, Singapore, Italy, United Arab Emirates, Japan, and Taiwan are dominated by women OFWs. In Hong Kong, for example, more than 90 percent of OFWs are women (Table 2).

How Labor Export Works

With its low rate of foreign investment and a steady reduction in development assistance, the government, not just its people, has come to rely on overseas employment as a strategy for survival. After years of pushing the official line that it does not promote overseas employment, the government set a target in 2001 of deploying a million workers overseas every year, a goal it is likely to meet in 2005.

Since the 1970s, the government and the private sector each have played a role in the labor export process. The Philippine Overseas Employment Administration (POEA) grew out of the Overseas Employment Development Board and the National Seamen Board in the then Ministry of Labor and Employment. POEA became the government agency responsible for processing workers' contracts and predeployment checks, as well as for licensing, regulating, and monitoring private recruitment agencies.

When the overseas program started, the government participated in recruiting and matching workers and employers. Due to demand for workers and the large numbers involved, the government relinquished the placement of workers to private recruitment agencies in 1976. There is a placement branch within the POEA, but it only accounts for a small number of all OFWs placed with foreign employers.

On the private-sector side, there are more than 1,000 government-licensed recruitment and manning agencies in the Philippines (and an unknown number of unlicensed ones) that match workers with foreign employers. In the Philippines, recruitment agencies refer to those that find jobs for aspiring land-based migrant workers; manning agencies refer to those that engage in recruiting and finding jobs for seafarers.

Recruitment agencies charge migrant workers "placement fees" for the service that they provide. Manning agencies are not supposed to charge placement fees as these fees are assumed by the principal or employer, but there are cases of known violations.

Although there is a standard placement fee for most destinations (except for special markets such as Taiwan) which is equivalent to one month's salary plus 5,000 Philippine pesos (about US$94) for documentation, this is routinely violated. The excessive fees are a burden to migrants and put them in a vulnerable situation because they are already in debt before they leave. When they are abroad, they go without any salary for a period of time, and they are forced to bear harsh working and living conditions in order to repay their loans.

Another government agency, the Overseas Workers Welfare Administration (OWWA), provides support and assistance to migrants and their families. All processes and requirements up until the point of departure are handled by the POEA, while the OWWA assumes responsibility for the workers' welfare while they are employed abroad. POEA and OWWA are under the Department of Labor and Employment.

A separate agency, the Commission on Filipinos Overseas (CFO), provides programs and services to permanent emigrants. CFO was transferred from the Department of Foreign Affairs to the Office of the President in 2004.

Among the countries of origin in Asia, the Philippines offers a fairly comprehensive package of programs and services covering all phases of migration, from predeparture to on-site services to return and reintegration. Although the government could improve its implementation of these programs, the programs demonstrate the government's efforts to balance the marketing of workers with protection.

Some of these initiatives, such as the predeparture orientation seminars for departing workers and the deployment of labor attachés and welfare officers to countries with large OFW populations, are good practices that other countries of origin have also implemented.

Protecting Workers Abroad

The irregular operations of recruitment agencies in the Philippines and their counterparts in the countries of destination are one of the sources of vulnerabilities for migrant workers. Excessive placement fees, contract substitution, nonpayment or delayed wages, and difficult working and living conditions are common problems encountered by migrant workers, including legal ones.

Migrant women face particular vulnerabilities. Aside from the usual problems that plague migrants, their jobs in domestic work and entertainment usually mean long working hours, surveillance and control by employers, and abusive conditions, including violence and sexual harassment. Given the "private" context in which they work, the problems encountered by migrant women in these sectors go unnoticed.

In general, compared to other national groups, Filipino workers are relatively better protected because they are more educated, more likely to speak English, and they are better organized. NGOs for migrants in the Philippines and their networks abroad not only provide services and support to migrants, but, more importantly, they advocate for migrants' rights

The development of a legal and institutional framework to promote migrant workers' protection is also an important factor. The Philippines was the first among the countries of origin in Asia to craft a law that aims "to establish a higher standard of protection and promotion of the welfare of migrant workers, their families and overseas Filipinos in distress." Although there had been discussions about a Magna Charta for migrant workers for some time, it was not until 1995 that the Migrant Workers and Overseas Filipinos Act (also known as Republic Act or RA8042) was finally passed.

The tipping point was the national furor in 1995 over the execution of Flor Contemplación, a domestic worker in Singapore, who many Filipinos believed was innocent despite her conviction for the deaths of her Singaporean ward and another Filipino domestic worker. This was a factor in fast-tracking the passage of RA8042.

Briefly, the law's provisions include:

• the deployment of workers in countries that ensure protection, including the banning of deployment if necessary;
• providing support and assistance to overseas Filipinos, whether legal or in an unauthorized situation;
• imposing stiff penalties for illegal recruiters;
• free legal assistance and witness protection program for victims of illegal recruitment;
• the institution of advisory/information, repatriation, and reintegration services;
• the stipulation that the "protection of Filipino migrant workers and the promotion of their welfare, in particular, and the protection of the dignity and fundamental rights and freedoms of the Filipino abroad, in general, shall be the his/her priority concerns of the Secretary of Foreign Affairs and the Philippine Foreign Service Posts;"

the establishment of the Migrant Workers and Other Overseas Filipinos Resource Centers in countries where there are large numbers of Filipinos;

and the creation of the Legal Assistant for Migrant Workers Affairs (now the Office of the Undersecretary of Migrant Workers Affairs) and the Legal Assistance Fund.

The haste with which RA8042 was passed has resulted in some problematic provisions, leading to calls for amendments. For example, in the Declaration of Policies, it is mentioned that "the State does not promote overseas employment as a means to sustain economic growth and achieve national development." Some sectors, such as the NGO community, believe the state does promote labor migration.

One controversial provision is Section 29, which deals with the deregulation of recruitment activities. If this were implemented, the regulatory functions of the POEA would have been phased out in 2001, that is, within five years of the law becoming effective. NGOs are against the deregulation plan because the playing field already is highly uneven. The recruitment agencies, on the other hand, are pushing for deregulation.

Overall, RA8042 has not been a complete failure. Some provisions have been implemented well (e.g., there are various information programs in place); some need to be fine-tuned, notably programs dealing with returning migrants and their reintegration in the local economy. There are also moves to amend certain sections of the law.

The Office of the Undersecretary of Migrant Workers Affairs, under the Department of Foreign Affairs, provides assistance to migrant workers who encounter legal problems abroad, while the National Labor Relations Council handles employment-related problems such as money claims.

In addition to government initiatives, the efforts of NGOs, church-based organizations, and migrants' organizations, as well as transnational and international efforts directed at promoting and protecting migrants' rights, help provide an "antidote" to the dangers of migration.

Among the countries of origin in Asia, the Philippines is also a leader in introducing several migration-related laws. These include:

the Anti-Trafficking in Persons Act of 2003, which establishes policies and institutional mechanisms to provide support to trafficked persons;

the Overseas Absentee Voting Act of 2003, which gives qualified overseas Filipinos the right to vote in national elections; and

the Citizenship Retention and Reacquisition Act of 2003, which allows for dual citizenship.

In terms of commitments to international norms and standards concerning migrants, the Philippines is one of 34 countries (as of October 27, 2005) that has ratified the UN Convention on the Rights of All Migrant Workers and Their Families. It is also one of 95 countries (as of November 6, 2005) that has ratified the UN Protocol to Prevent, Suppress and Punish Trafficking in Persons, Especially Women and Children.

Remittances

Aside from easing unemployment, Filipinos who choose to work abroad send home remittances that have become an important pillar of the Philippine economy (see Table 3). In 2004, according to the Bangko Sentral ng Pilipinas, remittances sent through formal channels amounted to US$8.5 billion. In 2005, remittances are expected to reach US$10 billion.

For the families of migrant workers, remittances are generally spent on fulfilling the basic needs of the family, better housing, educational opportunities for children, and starting or investing in small businesses. According to a 2005 World Bank report, the Philippines is the fifth-largest recipient of remittance flows after India, China, Mexico, and France.

The government encourages migrant workers to send remittances through banks. A study by the Asian Development Bank found that 80 percent of Filipino respondents regularly remit through banks or other regulated sectors. Among other reasons, lower remittance costs help explain the greater use of regulated channels than was the case in the past.

The Bangko Sentral ng Pilipinas is also working on enforcing minimum standards for banks and other players in the remittance business to protect OFWs and their families from fly-by-night operators, excessive fees, unfair foreign currency conversion, and delivery problems.

Looking Ahead

Within the Philippines, there has been much speculation about the costs of migration: the problems borne by migrants, anxieties about the destabilizing impacts of migration on families, apprehensions about materialism, and so forth. Although it is acknowledged that migrants and their families have benefited from labor migration, mostly because of remittances, the economic impacts beyond the family level are less tangible.

And while it is acknowledged that remittances have buoyed the country's economy, the development impacts have not been clearly felt. Some question what the country has to show for more than three decades of overseas employment.

In a strange twist, the Philippines has become so successful as a labor exporter that it has failed to develop and strengthen development processes. The target to send a million workers every year is a telling indicator that migration will be an important part of the country's future development plans and prospects.

Even without government involvement, labor migration from the Philippines likely will persist thanks to social networks, social capital, and social remittances that have flourished. Filipino society has become migration-savvy, having developed the ability to respond and to adjust to the changing demands of the global labor market.

Anticipation of future demand for nurses, for example, has resulted in the proliferation of nursing schools and a remarkable increase in student enrollment in nursing programs in recent years. Even doctors are studying to be nurses to have better chances of working abroad. This is a concrete example of how perceptions of the international labor market have also woven their way into the educational and work aspirations of Filipinos.

Individuals make decisions based on perceptions of what would be beneficial for them. But those decisions can have a cumulative effect on communities and the country. In the nursing example, the proliferation of nursing programs (which puts into question the quality of training), the specter of an oversupply of nurses, and the potential mismatch between skills needed and available human resources are some societal-wide concerns that must be considered and must be weighed vis-à-vis individual aspirations.

While the Philippines cannot stop people from leaving, the country will need to explore how migration can be an instrument for development. In this regard, the Philippines can learn much from international discussions and reflections on migration and development taking place in other countries.