April 1 return-to-office deadline bucked by BPOs

The business process outsourcing (BPO) industry—which created over 20,000 new jobs despite the recession in 2020 thanks to work-from-home arrangements—is asking for a few more months before most of its workforce returns to the office. But the government wants them all back by April 1.

“It’s not easy to transition back after two years of working from home. [That’s] moving basically [more than] 1 million employees from their homes so suddenly,” said Jack Madrid, president of the IT & Business Process Association of the Philippines (IBPAP), in a Zoom interview with the Inquirer last week.

Government guidelines placed earlier in the pandemic allowed the BPO industry, the largest employer in the private sector, to keep its tax breaks while having up to 90 percent of its employees work from home. This will last only up to the end of March, according to the Fiscal Incentives Review Board (FIRB), a deadline that IBPAP wants extended until September.

More jobs added

Working from home has helped the industry thrive despite persistent lockdowns, creating 23,000 new jobs in 2020, just when the crisis pushed the country’s unemployment rate to a 15-year peak. Its workforce grew further by 8 percent in 2021, said Madrid, noting that this added about 100,000 new jobs. Revenues also increased by around 12 percent last year, which, according to IBPAP data, reached a total of $28.8 billion.

“We have discovered that our work, the work of our industry, the work being done by the 1.4 million Filipinos, can be done at home,” said Madrid, who got appointed the top post in the industry group late in 2021. “We were able to achieve that without sacrificing productivity and customer satisfaction ratings, based on what we have gathered. I think we did not lose any business. In fact, we grew.”

The Inquirer reached out to the FIRB for comment last week, but Department of Finance (DOF) Assistant Secretary and FIRB secretariat head Juvy Danofrata had not yet replied as of press time. The FIRB is headed by Finance Secretary and FIRB chair Carlos Dominguez III. The Department of Trade and Industry (DTI), which is also part of the FIRB, had previously commended the role of the BPO industry in the economy especially during the pandemic.

Praise from Lopez

“This is the only sector that didn’t lay off workers and even continued to hire during this pandemic. This is helping the economy in its recovery efforts, in saving jobs, and contributions to dollar revenue generation,” said DTI Secretary Ramon Lopez, also FIRB vice chair, in a statement in May 2021. He said this when the industry got included among the priority sectors for vaccination.

BPO firms abroad, including those in the Philippines’ biggest competitor India, will likely continue to have many of their employees working from home even after the pandemic, according to a previous Inquirer interview with officials of the Everest Group, a research firm that advises Global 1,000 companies in outsourcing their services. The Indian government is already adjusting its policies and tax breaks to support BPOs working from home. The Philippines, said the officials, should do the same or get left behind.

“India even has a special program encouraging remote work by providing incentives to workers to return to their hometowns,” Madrid said, when asked for his observations about the Philippines’ top competitor. “If we just look at India alone, I think we should be concerned if we’re not going to follow suit.” INQ