Tough call for BPOs
Compel your employees to physically report for work or lose your tax perks.
That’s the challenge that business process outsourcing (BPO) companies located in economic zones and information technology parks have to address soon.
The Department of Finance (DOF) had ordered them to discontinue their work-from-home (WFH) arrangements and direct their employees to go back to their offices by April 1, otherwise they will forfeit the tax breaks they are currently enjoying.
To date, BPO companies have provided employment to some 1.3 million Filipinos in different parts of the country and contribute approximately $30 billion every year to the national coffers.
According to the DOF, the Tax Code requires those companies to do business exclusively within their assigned areas and that the resumption of office work would help the micro, small and medium enterprises (MSME) that support them.
The Alliance of Call Center Workers (ACW), a recently organized group of BPO employees, had expressed their opposition to the order.
It said BPO employees living in the provinces were reluctant to return to their offices because they have to rent accommodations in Metro Manila and that the WFH setup enabled them to support the MSMEs in their places of residence. And if the DOF insists on its order, many of their members may opt to resign from their jobs.
The ACW also said that at least four BPO companies were willing to forgo their tax incentives so they could continue with their WFH system of operation.
Whether or not those claims are true is a big question mark. For practical reasons, the BPO firms concerned have refrained from commenting on ACW’s statements lest they earn the DOF’s ire and invite adverse reaction.
Barring any change of heart by the DOF, those companies have only two days from today to figure out a way to continue to operate profitably (which is helped by the tax breaks) without risking the possible loss of some employees due to resignations or suffer from low morale by employees who comply with the order.
Note that the success of any business rests primarily on the efficiency and dedication of its employees. Without them, management would be unable to meet its financial objectives.
Considering the demands of BPO work, which range from odd working hours to obnoxious customers to stressful working conditions, it is in the BPO firms’ best interests to do everything possible to encourage their tried and tested staff to stay on the job.
For many BPO employees, working from the comfort of their homes had been a boon. They were spared the agony of the daily commute (with its attendant security risks) or, if that is a real pain in the neck, the cost of renting a boarding house or apartment near the office.
Having experienced the benefits of WFH, the level of enthusiasm or efficiency of these employees may dip if they are made to contend (once again) with the problems that are expected to arise if they return to their offices to do the same things they have been able to do well in their comfort zone.
And if they think it is not worth going back to prepandemic work arrangements, they may simply decide to resign and seek employment in companies that can make use of their expertise.
Getting replacements for them may be easy in light of the present high rate of unemployment, but there are drawbacks in new hires.
Aside from incurring training costs, the efficiency of BPO operations could suffer some “downtime” as the new employees learn the proper way to meet the requirements of BPO customers or clients.
It’s a tough judgment call for the BPO firms subject to the DOF order.
They have to decide whether their tax breaks can compensate for the possible resignation of some of their employees, or whether the productivity of employees on WFH status can offset the increase in their tax obligations with the forfeiture of their tax perks.
In resolving this question, it is best to remember that “the greatest asset of a company is its people.” INQ
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