THE Department of Labor and Employment (DOLE) admitted on Wednesday that possible higher tariffs and the potential passage of the Keep Call Centers in America Act pose risks to employment in the Philippines, which remains one of the world’s largest business process outsourcing (BPO) hubs.
Labor Secretary Bienvenido Laguesma said the department aims to conduct a preliminary assessment of employment risks to determine the possible factors to labor market instability, as the country faces global trade uncertainties and the potential passage of the US legislation seeking to curb call center outsourcing.
‘Externally, we are seeing [risks from] the possible imposition of higher tariffs. There is also the possibility that the Keep Call Centers in America bill will become law,’ Laguesma said in a budget briefing, adding that the labor department is closely monitoring these external developments.
The Keep Call Centers in America Act, filed in the United States by Senators Ruben Gallego and Jim Justice, aims to curb the outsourcing of call center operations by imposing stricter rules on firms that transfer a significant portion of their services overseas.
Under the proposed bill, companies that relocate at least 30 percent of their operations abroad would be placed on a public registry. Those listed could lose access to federal grants and loans, face penalties if they continue outsourcing while holding federal contracts and be deprioritized in future government bidding.
The bill also includes a consumer transparency clause that, one year after its enactment, would allow American customers to know if the call center agent assisting them is located outside the United States and to request a transfer to a US-based representative.
BPO Industry Employees Network (BIEN) earlier said that the proposed legislation could trigger widespread job losses in the Philippines, which hosts one of the largest call center workforces in the world.
The Center for Trade Union and Human Rights (CTUHR) also previously urged the Marcos administration to prepare protection measures for call center agents, warning that if passed, the law could lead to a ‘massacre of jobs’ in the country’s BPO industry.
DOLE meets stakeholders
According to Laguesma, DOLE had already met with the Contact Center Association of the Philippines on Tuesday to discuss industry concerns and determine how the government could provide support.
‘It’s not only related to the continuous increase in wages and the narrowing of profit margins, there were also other concerns mentioned.We see both external and internal factors that could become burdens or could dampen not only the expansion of the industry but also the entry of investors,’ Laguesma said.
‘Since it would be difficult if the review takes too long, we can probably come up with a preliminary assessment,’ Laguesma said.
The preliminary risk assessment, he said, may serve as a guide to address these issues.
He added that the department also maintains regular dialogue with the Information Technology and Business Process Association of the Philippines to gather more concrete information on the industry’s outlook, including how its partner firms assess the Philippines as an investment destination.