Features case studies of labor-management social partnership in unionized and non-unionized setting in the Philippines.

1. Social Partnership
Models: Challenges to
IR Actors
Dean Jorge V. Sibal
UP SOLAIR

2. Rationale for Employer-Labor
Social Partnership
 Labor intensive operations shifted to less
developed countries due to lower labor cost.
 Contractualization and the race to the
bottom wage rates have been very
detrimental to labor.
 The result is jobless growth and more
poverty (ILO, UNDP, ADB and the WB)

3. The Emerging New IR Models
 Governments, employers and labor groups
have utilized various interventions to
counter the negative effects of labor
flexibilization.
 These IR interventions use transformational
methods that enhance competitiveness and
productivity side-by-side with decent work
through more participative rather than
adversarial employer-labor relationship.

4. HRD employee participation as
coping up mechanisms
 At the firm level, Kuruvilla and Erickson
(2000) spoke of another pathway where
countries and industries can tread to
enhance quality and productivity.
 This is a functional form of flexibility that is
HRD-driven employer-labor social
partnership. The focus is on employee
participation and skill formation.

5. Philippine adjustment measures
 Domestic firms cope with structural,
social, and economic changes of
globalization thru:
 investment in HRD (53.3%); and
 improvement in quality of products and
services (79.8%)
(1999 DOLE Industrial Relations at the
Workplace Survey)

6. Definition of Social Partnerships
1. Proactive cooperation, conflict
resolution & problem-solving among
employers, employees & other
stakeholders
2. Outputs & outcomes are mutually
beneficial to the social actors in terms
of economic, social & political
empowerment

7. Characteristics of Social
Partnerships
1. Not Legalistic, prioritize use of
behavioral processes
2. Goals are industry productivity &
decent work for competitiveness

8. Characteristics of Social
Partnerships
3. Promotes theory Y or organized
relations with employees through
unions & other labor organizations.
Employee participation is also known as
employee involvement or worker
participation in management

9. Mechanisms for employee
participation in decision making
J. Gordon Autocratic Participa- Democratic Laissez-
tive Faire
IR/HRM Unilateral Consulta- Work Committee
Practices Decision tive, Councils, System
Making/ Bi/Triparti Co-
Unitary te (QCs, determina-
TFs, LMCs, tion, ESOPs
CBAs)
PLACES OF SMEs, Japan, Europe, Socialist
PRACTICE developing USA Germany, countries,
S countries USA state
enterprises

10. Basic Model of Social Partnership

11. Social Partnership Mechanisms
in the Philippines
1. Suggestion scheme, meeting, task force
2. Consultation- OSH Committee, SDWT, QC,
LMC
3. Collective Bargaining, Collective Negotiation
4. Gain-sharing- Employee Coop & Enterprise,
Profit Sharing, ESOP
5. Work Council, Employee representation in
the governing board

12. worker participation
in decision making
Practices Filipino Foreign w/ Union- Non-
-owned -owned Foreign ized union
equity ized
Number surveyed 26.774 1,200 2,180 3,291 20,86
3
1. Safety & health committee 44.5% 69.1% 58.1% 61.1% 44.7%
2. Suggestion schemes 38.0 47.6 50.0 41.9 38.8
3. Quality & productivity circles 29.4 36.6 32.3 40.2 28.4
4. Productivity improvement 28.4 35.7 37.0 40.1 27.9
committee
5. Grievance machinery 24.6 36.2 36.7 40.1 27.9
6. L-M council/committee 18.4 24.2 35.9 54.4 14.9
7. Joint committee & task force 16.9 32.2 25.5 26.0 17.2

14. LMC at Ebara Benguet, Inc
 Fostering principles of social partnership
and strategic management (dubbed as
“Partnership for Quality, Productivity
and Profitability” or PQP2).
(Jose Gatchalian)

15. LMC at Ebara Benguet, Inc-
Stages of Implementation
I – Series of dialogues between consultants,
management and labor
II – Strategic planning for quality & organizing
the quality steering committee
III – Promotion of PQP2 company-wide, with
group training on problem-solving techniques,
teamwork, principled CBA negotiations, etc.
and activation of the quality improvement
teams
IV – Evaluation.

16. LMC at Ebara Benguet, Inc-
Evaluation of Results
 Measured production volume, rejection rate by
weight, and profit and loss statement at period
intervals
 Quantitative results showed that production
volume significantly increased, rejection rates
by weight drastically reduced, bottom line
profit reflected positive yield, while actual loss
were reduced substantially.

17. ESOP effects on employee
commitment and productivity
 Employees in 4 domestic firms exhibited
higher organizational commitment and
greater productivity levels
(Aganon 1997)

18. Top Phil. Telecommunications
Company
 Guanzon (2006) assessed the readiness of a
top Philippine telecommunications company
and 3 of its suppliers to the global standards
of Social Accountability 8000.
 This management –initiated intervention was
intended not only to prepare the company for
global competition but also to “guarantee the
basic rights of workers and to improve their
working conditions”.

19. Top Phil. Telecommunications
Company
 The focus of the study was on
compliance with international standards
of child labor, forced labor, health and
safety, freedom of association and
collective bargaining, discrimination,
disciplinary practices, working hours,
remuneration, and management
systems.

20. Top Phil. Telecommunications
Company
 Guanzon concluded that the Philippine
telecommunications company obtained
a high level readiness to SA 8000 which
was equal to the compliance level of its
two multinational suppliers. It has
higher readiness achievement
compared to its 3rd supplier.

21. The transformation of industrial
relations at PAL
 PAL’s adversarial relations with its 3
unions led by the PAL Employees
Association resulted to a crippling strike
in 1998. This eventually caused PAL’s
closure.
(Salas-Zsal 2006)

22. The transformation of industrial
relations at PAL
 PAL’s reopening in September 1998 under
State receivership was conditioned on an
employer-union partnership which
featured the ff:
 union-management cooperation
 employee stock option program
 union representation in the Board in
exchange of a 10-year suspension of the
collective bargaining process.

23. The transformation of industrial
relations at PAL
 Today, after less than 9 years of
employer-union partnership, PAL is in
the pink of health and has recently
been freed from receivership status.

25. Labor-Management Cooperation Practices
in Unionized Workplaces
a. Central Azucarera Don Pedro, Inc.,
Nasugbu, Batangas
b. Mabuhay Vinyl Corporation, Iligan City
c. Energizer Philippines, Mandaue, Cebu
d. Del Monte Philippines, Inc., Bukidnon

26. Employee CB Employee Co- EE
Consultation management Rep.
Compa QC LMC CBA Coop. Enter ESOP ERGB
ny prise
1.CAD QC/ LMC CBA ESOP
PI OSHC
2.Ma OSHC IPC CBA Coop
buhay
3.Ener TPM- ERC CBA
gizer AC
4.Del LMC CBA
Monte

27. Central Azucarera
Don Pedro, Inc. (CADPI)
 Started with very autocratic leadership,
labor-management relationship was
unfriendly, adversarial and legalistic.
 Batangas Labor Union (BLU) organized in
1954 which led to two crippling strikes in
1959 and 1971 due to bargaining deadlocks.
Helicopters brought food to non-striking
workers while strikers cut the drinking water
to the factory site.

28. CADPI
 The scope of LMC at CADPI was expanded
to low-cost subdivision and housing project,
skills training, LMC Day celebration every
May 1st, giving out Model Workers awards,
strategic planning, job evaluation and
adjustment of allowances, giving service
awards for retirees, etc.

29. CADPI
 one of the best model of employer-labor social
partnership.
 efficient sugar milling and refining plants and one
of the most profitable in the industry
 2007 DOLE-NCMB and PHILAMCOP Hall of Fame
award, 2000 Hall of Fame Pro-Active
Achievement Award of the DTI Center for
Industrial Competitiveness, 1999 ECOP Kapatid
Award and the 1997 Sikap-Gawa Industrial Peace
award of the Bishop-Businessmen’s Conference
on Human Development on LMC category.

30. Mabuhay Vinyl Corporation
 LMC is called Industrial Peace Council (IPC)
after it became part of the company’s
strategic plans.
 Mabuhay IPC’s basic missions: industrial
peace; people empowerment and continuous
improvement; and address environment and
community issues and concerns.

31. Mabuhay Vinyl Corporation
 Team building and collective bargaining
negotiations and implementation are part of
IPC’s agenda
 dissemination of IPC activities are coursed
through the company newsletter (MVC
Pipeline), IPC bulletin boards, and various
company meetings- planning, regular,
department/section, and “magtanong sa
pangulo”

32. Energizer Philippines
 LMC started in 2000 with pro-active
leadership: team-based culture; open
communications to foster trust and harmony;
harmonious labor-management relations; and
union commitment to company programs.
 The Employee Relations Committee (ERC)
reversed the adversarial labor management
relationship: a strike in 1988; bargaining
deadlocks in 1994 and 1997; and a string of
grievance cases. Plant productivity of the
company was on the downtrend during these
periods.

33. Energizer Philippines
 No strikes and no lock-outs
 Zero grievance records since 2000
 5 days collective bargaining negotiations for
the 2005-2008 CBA
 No cases in outside venues
 The benefits of industrial peace based on
savings on work hours are: P500,000 for
speedy CB negotiations; P3 million for
absence of labor disputes; and P5 to P6
million for zero strike.

34. Del Monte Philippines
 LMC started as a CBA provision in 1983 but
did not become active.
 In 2001, the LMC was re-launched with the
opening of the plantation-wide sportsfest.
 It started as communication mechanisms and
activities revolved around sports, socials,
safety and grievance handling.

35. Del Monte Philippines
 Now, livelihood and income generating
projects are concerns of LMC
 Involved in community relations CSR
projects like tree planting, Pasko sa
Baryo (“Christmas at the Village”)
program, and Pineapple Pre-school
Learning Center.

36. Practices in Non-Manufacturing
Unionized Workplaces
 Bank of Philippine Islands, Makati City
 GMA Network, Inc., Quezon City
 Manila Electric Company, Pasig City
 University of the Philippines, Quezon City
 SM Shoe Mart, Manila

37. Employee CB Employee Co- EE
Consultation management Rep.
Com QC LMC CBA Coop Enter ESO ERGB
pany prise P
5. BPI OSHC LMC CBA
6.GMA OSHC LMC CBA Coop
7.Mera OSHC LMC CBA Coop Mesala ESOP
lco , etc
8. UP Com- Coun- CNA Coop PF BOR
mittee cil Reps
9. SM OSHC CBA

38. Bank of Philippine Islands
 Partners with 24 rank-and-file unions
nationwide
 Mechanisms used for industrial peace
and harmony- collective bargaining,
labor management conferences, open
communications /open door policy, and
training program on value-based labor
relations.

39. GMA Network, Inc.
 3 decades of employer and union
partnership operating on mutual trust
and cooperation

40. GMA Network, Inc.
 Jointly decides and consults through:
collective bargaining; organization of
company events; the GMA 7 Employees
Multipurpose Cooperative; the GMA
Kapuso Foundation; communications
mechanisms; occupational health and
safety committees; and
grievance machinery.

41. Manila Electric Company
 Transformed hostile and legalistic union-
management relations to an HRD-focused
employer-union partnership
 MERALCO has high regard for the
employees’ primary role in boosting the
company’s productivity.
 Partners with the academe, notably UP
and AIM

42. Manila Electric Company
 MERALCO has reinforced employer-union
cooperation in other HR productivity
interventions such as the LMC, pension
fund, voluntary separation program,
employees’ savings and loan association,
multi-purpose cooperative, health
maintenance plan, mutual benefit
association, livelihood training for
employees’ dependents, etc.

43. University of the Philippines
Good practices in social partnership in
governance namely:
1) voluntary austerity program;
2) provident fund managed by the
employees; and
3) democratic representation at the
Board of Regents, the University’s
highest policy making body.

44. University of the Philippines
The 11 regents include the University
President as Co-Chairperson:
 7 seats are allotted to the major
stakeholders- one seat each for faculty,
students, staff (employees) and the
alumni association President;
 3 seats for professionals (2 should be
alumni);
 3 seats for government

45. Practices in Unionized Workplaces
in the Regions
 Holcim Philippines, Inc., La Union
 Holcim Philippines, Inc., Lugait, Misamis
Oriental
 Philippine Associated Smelting
Corporation, Isabel, Leyte
 Coca Cola Bottlers Phils.-Ilocos Plant,
Ilocos Norte

46. Employee CB Employee Co- EE
Consultation management Rep.
Com QC LMC CBA Coop Enter ESO ERGB
pany prise P
10. OSHC LMC CBA
Holcim
11. OSHC LMC CBA
Pasar C
12. OSHC WIP CBA
Coke

47. Holcim Philippines, Inc.
 LMC has developed good relations with the
local community, and improved labor-
management climate.
 Good labor-management relations impacts
directly on profitability, productivity, job
security and quality of life.
 LMC was institutionalized in the CBA on May
11, 1957

48. Philippine Associated Smelting
and Refining Corporation
The successful social partnership brought
improvements in the workplace-
 recreational facilities,
 sports programs and regular bus services for
employees and dependents,
 labor education initiated by the union,
 safety and health programs (P13 million),
scholarship for dependents, skills and
competency-based training programs (P15.5
million),
 medical services with a hospital, etc.

49. Practices in Non-Unionized
Workplaces
 Ford Motor Company Philippines, Sta.
Rosa, Laguna
 Moog Control Corp., Baguio City
 SPI Technologies, Inc., Paranaque City
 United Laboratories, Inc., Mandaluyong
City

50. Employee CB Employee Co- EE
Consultation management Rep.
Com QC LMC CBA Coop Enter ESO ERGB
pany prise P
13. PP / OBM
Ford SMT
14. OSHC ERC Coop PS
Moog
15. SPI OSHC EC Coop
16. OSHC EC UBF PS
Unilab

51. Ford Motor Company Philippines
 Social partnership in Ford is inculcated
through shared corporate values and open
door policy in communications. Conflicts are
resolved through various communications
mechanisms such as the corrective action
process, people development committee, HR-
department meetings, manufacturing
functional meetings, lunch with HR Director,
Usapang Ford, SMT steering committee and
partners’ pillars.

52. Moog Controls Corporation
 No time clocks but the employees report
accurately their performances.
 Profit sharing program that returns a
significant part of the company’s earnings to
the employees.
 Employee relations committees (ERCs),
continuous peer training and performance
reviews, performance and conduct counseling
and disciplining, grievance machinery,
employee volunteer welfare committees and
an employee cooperative.

53. United Laboratories, Inc.
 Employees Council (EC) was set up in
1959 to serve as the voice of the
employees and a partner of
management in providing for the needs
and improving the quality of life of
employees.
 Profit sharing program, etc.

55. Challenges to the IR Actors
 The country has numerous successful
practices and experiences on employer-
labor social partnership.
 There is no theoretical guidance on
which combination of interventions in
social partnership may prove effective
in achieving organizational productivity.

56. Challenges to the IR Actors
 In the meantime, the problems of
enterprises and labor in preserving and
expanding workplaces and jobs in the
country need daringness in planning and
implementing employer-labor partnership
interventions.

57. Benefits from social partnership
 Increased productivity;
 Industrial peace- no strike and no lock out,
minimal to zero grievances, minimal union-
initiated labor cases; speedy collective
bargaining negotiations, etc.;
 Better communications between labor and
management; and
 Above industry compensation and benefits.

58. Policy Recommendations
1. While social employer-labor
partnership is fast being implemented
in large Philippine enterprises as
shown in this paper, there is need to
cascade these good practices to the
smaller firms that employs the bigger
bulk of the labor force.

59. Policy Recommendations
2. Employer initiatives in promoting good
practices of corporate social responsibility
(CSR) should be supported not only by their
employees but also by other stakeholders.
This was illustrated in both unionized and
non-unionized establishments shown in this
paper. Another example of this initiative is
SM’s “Big Brother, Small Brother”
partnership in job preservation and job
creation.

60. Policy Recommendations
3. The various social accords among employers,
trade unions and government like the
“Social Accord for Industrial Peace and
Stability” signed in October 4, 2004 by
ECOP, trade union federations (TUCP, FFW
and TUPAS) and DOLE should be
transformed into concrete activities,
projects and programs and not limited to
contract signing and publicity events.

61. Policy Recommendations
4. The operations of the Tripartite
Industrial Peace Council (TIPC) should
be expanded to provincial, city,
municipality, barangay and industry
levels.

62. Policy Recommendations
5. Trade union organizing and collective
bargaining through RA No. 9481 should be
supported by the social partners. As
illustrated in the case studies, employers
and trade union cooperation contributes to
productivity and decent work. For those
who opted for non-unionized form of social
partnership, alternative interventions
featured in this paper has resulted to the
same outcomes- industry productivity, labor
empowerment and improved working
conditions.

63. Policy Recommendations
6. The campaign of the IR actors for
patronage of locally-made products
following Philippine quality standards
and the campaign against smuggling
are effective mechanisms for job
creation and job preservation. This is
another area ripe for social
partnership interventions.

64. Policy Recommendations
7. The voluntary adoption of ESOP in
Philippine enterprises can be refiled at
the Philippine Congress now that the
success of ESOP’s experiences in the
country especially on PAL has shown
very positive results.

65. Policy Recommendations
8. Employee representation in the
governing boards of government
corporations like those at the
University of the Philippines and
tripartite representation at the GSIS,
SSS, ECC, OWWA, etc. should be
expanded to other state corporations,
and possibly encouraged for adoption
in private enterprises.

66. Policy Recommendations
10. Voluntary compliance with the Philippine
Quality Award Act (under RA No. 9013)
should be given more incentives by the
social actors. The PQA standards should be
divided into various categories similar to the
ISO standards (ISO 9000, 14,000, etc.). The
social actors especially the civil society
should campaign for patronage of PQA
complaint enterprises.

67. Policy Recommendations
10. Philippine retailers like SM should also
champion compliance to all Philippine
standards like DO No. 57-04 for labor
standards, PS standards of DTI for
electrical products, BFAD standards for
food and drugs, ban in selling pirated
DVDs and CDs of local films and music
and other smuggled products.

68. Policy Recommendations
11. The Securities and Exchange
Commission should encourage elected
employee representatives as possible
occupants of the 2 seats allotted for
independent directors for publicly-
listed firms.

69. Policy Recommendations
12. Social partnership should also be expanded
among principals and subcontactors and
suppliers. Big enterprises should extend
educational and technical assistance to
subcontractors and suppliers to enable them
to comply with local and international
quality standards in exchange for
continuous patronage of their products and
services.

70. In closing, Pope John XXIII
(1961)
 “…the relations between the employers and
directors on the one hand, and the employees
on the other, be marked by appreciation,
understanding, a loyal and active
cooperation, and devotion to an undertaking
common to both, the work is considered and
effected by all members of the enterprise, not
merely as a source of income, but also as the
fulfillment of a duty and the rendering of a
service. This also means that the workers
may have their say in and make their
contribution