JEDDAH, 9 March 2007 — The Saudi Philippine Business Council has endorsed the “ladderized salary scheme” being proposed by the biggest group of Philip-pine recruitment agencies as an alternative to the controversial new rules imposed by the Philippine Overseas Employment Agency (POEA) on the hiring of Filipino domestic helpers.

In a letter dated Feb. 25, 2007, to the Philippine Association of Service Exporters Inc. (PASEI), SPBC Chairman Waleed Al-Swaidan said his group found the proposal “acceptable and reasonable” and that they were open to more discussions on the matter.

Al-Swaidan was referring to a compromise being sought by PASEI, which supports the policy requiring household workers to undergo proper training and to secure a certificate of competency, but wants a rationalized salary scheme in lieu of an across-the-board $400 monthly minimum.

In an earlier letter dated Jan. 27, Al-Swaidan warned that the POEA’s new rule setting the minimum monthly salary for domestic helpers from the Philippines for an overseas job to $400, from the previous $200, would have a disastrous effect on the entire industry.

Specifically, he said, the new minimum salary was “exaggerated” and may lead employers not to pay the full amount, which would cause misunderstandings between the employer and employee.

He said the rule could also increase the problem of contract substitution, in which the employer forces an employee to sign a contract different from what had been approved by the POEA.

Worse, employers in the Kingdom may refrain from hiring domestic helpers from the Philippines since there are countries offering a lower rate, Al-Swaidan warned in his letter.

Reform Package

The increased minimum salary is part of a package of reforms hatched late last year by the POEA Governing Board, whose members include representatives of service exporters, seafarers, land-based overseas contract workers, and the private sector.

The other components of the package include setting the minimum age for hiring of HSWs at 25, providing training and requiring an assessment certificate for HSWs, and requiring employers to provide certain documents if they want to hire Filipino HSWs.

HSW is defined to mean not just domestic helpers but any Filipino worker hired for household-related work, including gardeners, caregivers, live-in cooks, dressmakers and babysitters.

The new rules have proved to be contentious, with some would-be OFWs joining some recruitment agencies in Manila in a bid to pressure the government to backtrack.

Other groups, particularly those championing the rights and protection of overseas workers, found the package to be long overdue but worried over how some countries might react.

In what was seen as a possible counter-measure, employers in the Kingdom are now reportedly no longer allowed to deal directly with Philippine recruitment agencies — they have to pass through Saudi recruitment agencies, who will then act as middlemen.

Loreto Soriano, president of LBS Recruitment Solutions Inc. and former PASEI president, had said the new layer to the requirements for the deployment of Filipino workers will lengthen the process and might cost about $100 more.

He said this new requirement has not been officially communicated to the Philippine government but it had already been put into in effect.

Middle Ground

PASEI President Victor E. R. Fernandez Jr., in his reply to Al-Swaidan, noted that his group had written President Gloria Macapagal Arroyo on Dec. 17, 2006, to say that while they were all for upgrading the skills and qualifications of HSWs “by providing additional training and by conducting assessment of their core competencies” so they can command a good pay, they wanted a middle ground on the minimum pay issue.

The group proposed the following graduated salary scheme in place of an across-the-board entry level minimum of $400:

• Minimum of $200 for ordinary, all-around first-timer HSWs;

• $300 for HSWs cum sewer, dress-maker, cook, or babysitter;

• $400 for HSW cum tutor, governess or caretaker.

PASEI said higher salaries, upon contract renewal, could even be negotiated between the employer and employee.

It said that “although the concern and motive” of the POEA’s new rule was “very noble,” it could “cause havoc” in the overseas employment industry” with everyone, including midwives and teachers, joining the “mad dash” to apply as household workers in view of the minimum entry level salary of $400 even for those trained only for a few days or weeks.

“The POEA will actually be promoting inadvertently the deployment of domestic helpers,” said the letter signed by Fernandez. It said the $400 minimum entry pay for HSWs would also create distortion and disparity of wages, with an ordinary skilled carpenter or construction worker, electrician or a semi-skilled worker, cleaner or janitor becoming disadvantaged vis-à-vis an HSW.

PASEI also warned that seasoned or experienced Filipino HSWs who are receiving a salary lower than $400 could develop ill-feelings toward a new comer who is going to be paid $400.

The PASEI further expressed concern that while Taiwan, Hong Kong and Israel may be able to comply with the minimum salary requirement, it could result in the following problems in other countries.

• Rampant contract substitution. For want to work abroad, an HSW connives with the foreign employer by signing a $400 monthly salary contract just to comply with the POEA rule, but will sign another “true” contract agreeing to receive a much lower monthly salary.

• Increase in “repro” of job orders. An applicant’s contract would be processed as a cleaner or janitress at a lower salary to avoid the minimum salary rule for HSWs, but the worker will actually be a domestic helper.

• Increase in illegal recruitment activities. Employers, to avoid paying $400, will require their HSWs not to be documented as a contract worker nor be processed by the POEA. They will be made to travel abroad on a visit or tourist visa or under the so-called direct-hiring or “free” visa, thus depriving the worker of coverage of the OWWA membership.