OFWs slam 6-month advance payment to Pag-IBIG

August 10, 2010

By Jerome Aning
Philippine Daily Inquirer
First Posted 22:49:00 08/10/2010

Filed Under: News, Government offices & agencies

MANILA, Philippines—Overseas Filipino workers and their recruiters alike are up in arms over the compulsory six-month contribution OFWs are now forced to make to the Home Development Mutual (Pag-IBIG) Fund even before they could leave to start work abroad.

The OFW group Migrante International described the mandatory contribution as another form of “legalized kotong (unjust exaction) as well as “bawal na pag-ibig (forbidden love),” puns on the original, and still popular, name of the fund, which was “Pagtutulungan sa Kinabukasan: Ikaw, Bangko, Industriya at Gobyerno.”

“This added burden is unfair, unreasonable and we question its real intent,” said Migrante chair Garry Martinez in a statement.

Martinez called on the government to stop the implementation of Republic Act No. 9679, saying that “if the President has the interest and welfare of OFWs at heart, he should first conduct consultations with OFWs before imposing more questionable and onerous fees.”

Martinez said they also plan to bring the OFWs’ opposition to the attention of Vice President Jejomar Binay, chair of the Housing and Urban Development Coordinating Council.

The Philippine Overseas Employment Administration recently issued a memorandum compelling OFWs to pay, upon registration and deployment, an initial membership contribution of P600 for six months as a prerequisite to the issuance of their Overseas Employment Certificate.

The circular became effective on Aug. 1 as a result of RA 9679, or the Home Development Mutual Fund Law of 2009, which places informal sectors under mandatory Pag-IBIG coverage.

Martinez said RA 9679 states the fund should come from the “mandatory contribution support of the employers.”

It also states that “failure or refusal of the employer to pay or remit … shall not prejudice the right of the covered employee to the benefits.”

He said the law became “muddled and misleading” in its implementing rules and regulations.

“These irregularities once again entail the virtual passing on of fees meant for the employers to the OFWs. Despite what is clearly stated in the law, the government unfortunately has no soundproof mechanism to ensure that the employers would pay their share. Moreover, can we really count on the employer to pay the contribution of the OFW since, sometimes, the employer would not even pay wages?” he said.

For its part, the Philippine Association of Service Exporters Inc. said it had no objection to the mandatory Pag-IBIG membership for OFWs but to the implementing rules.

Pasei president Victor Fernandez Jr. said Pag-IBIG was a way for OFWs to save for the future, build assets and provide a tangible “sense” or reason for working overseas and making worthwhile their sacrifice of being away from their loved ones.

What Pasei objects to is why overseas employers are being used as membership implementors and why the compulsory contribution is tied to the processing and documentation of OFWs’ travel papers, he said.

“Why will the OFWs be deprived of their right to employment if they do not pay before their departure? Why can’t they just be made a member before departure and be made to pay when they are onsite?” he said.

Fernandez also wondered how the six-months advance payment figure was arrived at. “Why not three months? Why not one year in advance? Why not payment depending on the duration of the contract? Why not monthly paid by beneficiaries instead?” he said.

He said the law did not specifically provide for the advance compulsory contribution “because it was not intended” to be that way.

“There is a cosmetic agenda here,” he said.

Furthermore, Martinez said, the OFWs were being forced to make contributions when they were not even assured of receiving housing benefits. He cited a section of the law that states that only members with the “ability to pay” would be granted housing loans.

“How will the fund’s board of trustees determine if OFWs have the ability to pay? It now appears that not all who pay can avail of a housing loan. What if you’re just an OFW with small earnings or a contractual employee and cannot afford the monthly amortization? You’re paying for nothing. This is really an illegal exaction,” Martinez said.