Changes in Philippine labour relations policy: Convergence or divergence of productivity, flexibility and welfare?

In the first decade of the present century, a succession of changes to Philippine labour law and jurisprudence sought to contribute to productivity and social welfare by introducing greater industrial relations flexibility, based on collective bargaining and voluntary dispute settlement. The article examines whether these changes actually resulted in any shift from a rights-based system for resolving industrial disputation to a system based on workplace-level interest-based negotiation, and whether they were accompanied either by higher labour productivity or by improved social welfare. The analysis draws on a conceptual framework that identifies coherent national labour regulation systems as being based on a convergence of three institutional approaches – to the operation of labour markets, of labour relations and of social security. Broadly, such labour regulation systems can be classified as either civil law or common law based. The Philippine labour regulation system is shown to have a hybrid basis, whose origins are briefly traced by identifying the legacy of the colonial and post-colonial phases, the martial law era and the restoration of democracy in 1986. Whereas Australia, another hybrid system, appears to have achieved some coherence in changes to the regulation of industrial relations, labour markets and social welfare, in the Philippines, such changes have not converged. In the 1990s, efforts to mitigate the traditional legalistic and adversarial character of industrial relations through liberalisation of restrictions on the right to organise were cross-cut by the effects of the growing labour market flexibility that resulted from integration into the global economy. Legal changes between 1999 and 2011 have not fostered voluntary self-organisation of distributive bargaining at enterprise level. Union membership, collective bargaining coverage and numbers of workers involved in notified or actual industrial action have declined, while reliance on compulsory arbitration and monetary compensation claims has remained high. Labour productivity has not improved. Within the context of globalisation, the labour market is increasingly characterised by numerical flexibility and a prevalence of small enterprises. High unemployment levels and a large informal sector indicate divergence between the systems for regulating labour and welfare.