Ghost Month: August 11 - September 6

Phil Long Distance Telephone Co.

DoLE insists PLDT should regularize workers without conditions

THE Department of Labor and Employment (DoLE) on Wednesday reiterated that telecommunications giant PLDT, Inc. should regularize the contractual workers of its service providers.

“Consistent with the Resolution dated 10 January 2018 and the Resolution dated 24 April 2018, this Office clarifies that pursuant to existing laws, the regularization of workers as a result of the finding of labor-only contracting takes effect by operation of law, and is not subject to any condition,” the DoLE said in an order dated July 11.

In January, DoLE ordered PLDT to regularize over 7,300 employees of its service contractors, after finding these were engaging in labor-only contracting schemes. It also ordered 38 service contract providers of PLDT to cease and desist from providing services to the telecommunications companies.

The DoLE denied PLDT’s appeal in April.

“We will inform that many of the service providers, ’yung nagprovide ng workers (the ones who provide the workers), are owned by the officers or executives of PLDT. This probably explains why they are trying to delay because it will cause loss of income in the part of the executives,” Labor Secretary Silvestre H. Bello III said during a press conference on Wednesday.

Mr. Bello said PLDT has tried to circumvent the DoLE order by asking the employees to re-apply.

“(This) is not the right action on their part because our decision is that all the 7,000+ are already employees of PLDT,” he said.

PLDT declined to comment, saying it has not received DoLE’s latest clarificatory order.

The company has filed a petition for certoriari before the Court of Appeals (CA), questioning the legality and validity of the DoLE order, saying that aspects of the order are “inconsistent with applicable law, jurisprudence, and the documentary and testimonial evidence.”

PLDT said 23 affected service contractors have also questioned the decision before the CA.


...good for TEL

CA nullifies order for PLDT to regularize at least 7,000 workers

The Philippine Long Distance Telephone Company (PLDT) has managed to get relief from the Court of Appeals, which nullified an order from the Department of Labor and Employment (DOLE) for the company to regularize 7, 344 workers that it hired from third-party contractors.

In its ruling. dated July 31, 2018, but made public only on Monday, the appeals court’s 10th Division, through Associate Justice Edwin Sorongon, nullified the resolution issued by DOLE last January requiring PLDT to regularize workers involved in the following:
  • business process outsourcing (BPO) services
  • information technology (IT) services
  • IT support services and applications development
  • janitorial, messengerial and clerical services
  • back office support and office operations
  • sales
  • medical, dental, engineering and other professional services

The court said it could not find any concrete evidence that the more than 7,000 workers should be regularized.

It noted that, in coming up with the order, records had shown that DOLE’s regional director “heavily relied” on the interviews of some employees and then applied them to all other workers and employees who were not actually interviewed.

“It is highly conjectural, if not purely speculative, to consider the individual circumstances of some workers who were interviewed to be exactly similar to the factual circumstances pertaining to the other contractors’ workers,” the appeals court said.

“Such findings cannot constitute the substantial evidence required to prove the existence of employer-employee relationship or labor-only contracting,” the court added.

The court added that PLDT did not violate any law when it decided not to regularize the BPO and IT support personnel.

It noted that DOLE Department Circular No. 1, series of 2017, actually exempted such services from the coverage of Department Order No. 174, which defined labor-only contracting.

This meant “there is no basis for [the] inclusion” of the employees of the contractors rendering IT support services for PLDT in the regularization order.

Neither were personnel who render medical, dental, engineering and other professional services covered by regularization.

The court said they were “independent contractors” because of their “unique skills and talents” meant the PLDT management “lack[ed]… control over the means and methods in the performance of their work.”

“This group of employees is expected to provide professional service based on their independent discretion as such professionals,” read the decision.

Like the BPO and IT support personnel, the professionals are also exempted from DOLE Department Circular No. 001-17 from coverage in its regularization orders.

Similarly, the sales agents who were paid on commission basis could not be covered by the regularization order because of the same circular.

The court stressed that “the consistent and long settled rule in jurisprudence is that those who are paid on a commission basis are not employees.”

At the same time, the court remanded the case to the DOLE-NCR office for the review and proper determination of the monetary award on the labor standard violations of PLDT and to conduct further proceedings, consistent with its decision.

The court said that while it commiserated and appreciated the toil and hardships of the employees that will be affected by its ruling, “this sense of compassion should also be coupled with a sense of fairness and justice to all the parties concerned.”

“Hence, while social justice has an inclination to give protection to the working class, the cause of the labor sector is not upheld at all times as the employer has also the right entitled to respect in the interest of simple fair play,’ it added.

The CA said Labor Secretary Silvestre Bello III in issuing the assailed orders did not make his own independent consideration of the law and facts of the controversy, but rather he simply accepted the views of his NCR director.

Concurring in the decision were Associate Justices Sesinando E. Villon and Maria Filomena D. Singh.

Meanwhile, PLDT issued a statement said it was already studying the Court of Appeals decision “to determine the company’s appropriate next steps.”


...good na rin na magpapasok ng investors sa naluluging Voyager venture nila...pero bumaba naman ang earnings report kaya panget pa din

Foreign investor group eyes majority stake in PLDT unit

A GROUP of foreign private equity investors is looking to acquire a majority stake in Voyager Innovations, Inc., according to PLDT Chairman, President and CEO Manuel V. Pangilinan.

“This week, we signed a non-binding, fairly-formed and detailed term sheet with certain foreign investors, who will take an investment position and management participation in Voyager,” he said in a press briefing on PLDT’s first-half results on Thursday.

The telecommunications giant has four weeks to finalize deal with the foreign group over the Voyager investment.

“Once the definitive documents are signed, two things will happen: one, we will make a disclosure to the stock exchange, and secondly, we will notify the Philippine Competition Commission (PCC) with this particular investment to be approved by the PCC,” Mr. Pangilinan said.

The sale of Voyager, which registered a P1.3-billion loss in the first six months of 2018, is expected to have a positive impact on PLDT’s financials.

“It’s likely to produce a significant gain to the accounts of PLDT. I think if we can expedite the approval from the PCC, it is likely that we can see the gain some time in the fourth quarter of 2018,” Mr. Pangilinan said.

As the digital innovations unit of PLDT, Voyager manages PayMaya Philippines, Inc., Smart Money, FINTQ, Lendr and freenet.

“Since this will involve as well a significant amount to be injected into Voyager, it could fund the operations of Voyager on expanding in the next three to four years,” the PLDT chairman added.

Mr. Pangilinan declined to name the investors, except to say they are involved in financial technology.

PLDT is likely to remain the single largest investor in Voyager with its investment of P9 billion to P10 billion so far, but Mr. Pangilinan said the foreign investors as a group would take a majority share when the deal is done. He added PLDT will retain a 45% stake in Voyager.

On Thursday, the telecommunications giant reported its attributable net income dropped 58% to P4.862 billion in the second quarter, from P11.56 billion during the same period a year ago. Last year’s figure included proceeds from the sale of its equity interest in Beacon Electric Asset Holdings, Inc.

For the first half, attributable net income fell 29% to P11.76 billion, “primarily due to lower net income from wireless and other businesses, partly offset by higher net income from fixed line business.”

Excluding non-recurring items, the six-month core profit dropped 25% to P13.13 billion. PLDT maintained a full-year core income guidance of P23-P24 billion, excluding Voyager.

“We have stayed on the growth path through the mid-point of this year by banking chiefly on the momentum of our Home and Enterprise businesses. Our Individual Wireless business has taken further steps forward, making gradual additions to its revenues and subscriber base,” Mr. Pangilinan was quoted in a Thursday statement as saying.

Revenues rose 5% to P41.73 billion in the April to June period, bringing the six-month tally 4% higher to P82.2 billion.

The company said this was “primarily due to higher revenues from data services in the fixed line business, as well as higher non-service revenues from the wireless and fixed line businesses, partially offset by lower revenues from mobile and home broadband services in the wireless business.”

For the first half, data/broadband and digital services accounted for P39.6 billion in revenues, representing 54% of the total service revenues.

Fixed broadband revenues grew 58% to P13.2 billion; mobile internet rose 29% to P12.3 billion; and corporate data and data center generated P10.9 billion in revenues, up 13%.

By business unit, PLDT Home recorded a 14% increase in revenue during the January to June period to P18 billion, fuelled by a strong demand for fiber-powered broadband service.

PLDT Enterprise revenues went up 9% to P18.7 billion in the first half, driven by higher wireless data, cloud and other services.

The Individual Wireless business group’s revenues jumped 2% to P29.9 billion, as mobile data revenues grew.

Mr. Pangilinan said PLDT conducted a pilot test with Ericsson for its 5G roll out on Wednesday, targeting to launch this in early 2019.


...this is good news for TEL investors Smile

PLDT, Smart on track to meet data service targets

PLDT, Inc. and wireless subsidiary Smart Communications, Inc. said the group is on track to meet its 2018 targets for the expansion of fixed and wireless networks in the country.

In a statement over the weekend, the telecommunications giant said it has already put up 12,600 Long-Term Evolution (LTE) base stations all over the Philippines and has reached 1.86 million ports for its fiber-power fixed broadband network.

PLDT is targeting to deliver high-speed wireless data services to over 90% of the country, and to increase its fixed broadband network capacity to 2.2 million ports — both by end-2018.

“As of end-June, Smart has installed more than 3,900 LTE base stations, increasing the total count by 45% to over 12,600, and enabling Smart to improve its Long Term Evolution (LTE) coverage, as well as to activate LTE-Advanced (LTE-A), which offers even higher data speeds and capacity,” it said.

It added the same period also saw the company expand to 5.07 million homes the coverage of its fiber-power fixed broadband network, “(boosting) its capacity to 1.86 million ports, nearing its full-year target of 2.2 million ports.”

The company said the roll-out of its fiber optic transmission and distribution network was instrumental in the expansion of its fixed and wireless networks. In the six-month period, PLDT said its fiber footprint has increased to 204,000 kilometers after mounting more than 29,000 kilometers of fiber cable.

“These expansion projects greatly enhance Smart’s mobile network by providing high-capacity fiber connections for LTE base stations,” it said.

The company noted the continuous expansion of its data business is the main driver of its revenues during the first half of the year, growing 4% to P82.2 billion.

“Moving forward, our task is to accelerate our digital pivot by pursuing whenever possible converged digital initiatives across our business segments — Home, Individual Wireless, and Enterprise,” PLDT Chief Revenue Officer Ernesto R. Alberto said in the statement.

PLDT said P31.5 billion of the company’s P58-billion capex for 2018 is allotted for the wireless network, while P26.5 billion is set for the fixed line network.


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