Labor Pains

sometime late december (2007) i got a call from mem and she asked me if i knew anything about a thousand people that got laid off from Western Watts. i was honestly caught off guard as i make it my responsibility to monitor industry movement and something this big should have made a beep somewhere in my radar.

early this year i called up a friend whose son works for Western Watts and confirmed that people were laid off sometime just before Christmas last year. Last week a commentary by Bobby Nalzaro in SunStar reported about a thousand people were laid off. the reports indicate that the company terminated the services of people due to gross incapacity to meet performance standards as set by the company.

what a lot of bull.

any decent performance management system allows for an employee to be coached and provided ample warning of roughly two months before decisions to terminate services are served. this is backed up by documented reports on performance, coaching sessions as well documented warnings served and acknowledged by the employee in question.

but to terminate a thousand employees almost within days leading up to christmas is something that baffles my mind, if not callously barbaric.

with survey or market research services taking a nosedive in the US as the USD continues to drop, my personal theory is that Western Watts is finding the cost of maintaining operations has become expensive.

that or the company has hired grossly incompetent managers and supervisors - where else can you "suddenly" conclude that a thousand employees are not performing and should be terminated from the company? what is happening in human resource?

article 282 of the Philippine Labor Code (click on link to download a copy) titled "Termination by Employer" outlines the conditions where an employer can terminate the services of an employee:

  1. Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in connection with his work;

  2. Gross and habitual neglect by the employee of his duties;

  3. Fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized representative;

  4. Commission of a crime or offense by the employee against the person of his employer or any immediate member of his family or his duly authorized representatives; and

  5. Other causes analogous to the foregoing.
these are all legitimate reasons for termination of employment.

on the other hand, any of the provision should be supported by proper documentation and procedures supported by a formal performance management process. it is illegal to terminate services if any of the conditions are not met:
  1. the company does not have any documented performance management process that shows performance targets, frequency of review and coaching for the employee, documented policies, escalation of warning leading to termination

  2. documented discussion of performance that shows the employee did not meet the performance standard

  3. proof that the company provided training, coaching and support to the employee to reasonably perform the tasks set and achieve performance targets

  4. proper procedure complying to the escalation of warnings leading to termination
the state provides the proper framework to protect the employee - on the other hand,
  1. majority are not aware of their rights as an employee and the proper process for termination
  2. where to seek help and arbitration in a case where an employer unlawfully terminates employment
Here's the Contact Information for the Department of Labor and Employment:

Regional Office No.7
2nd Floor, GMC Plaza Building
cor. M.J. Cuenco Ave. and Legaspi St., Cebu City
(032) 2530638, 2549415
Fax (032)2539512

the labor code also provides a framework for termination of services due to closure of establishment or reduction of personnel (article 283, Closure of Establishment and Reduction of Personnel) that allows an employer to protect the business in the case of loss of client, improvement of processes and systems leading to redundancy, or bankruptcy. The employee needs to understand that there are still provisions to this with the necessary compensation laid out in detail by the labor code.

my personal conspiracy theory is that the employees were terminated under the guise of performance so the company does not take a hit in terms of compensation as well as repercussion in terms of bad press related to reduction in business.

this whole scenario is made more complicated by the fact that Western Watts is still going through with full page ads looking for new victims, errr, employees.

this post goes out to everyone who has relatives in the BPO/call center industry. know your rights and forward this to people who may yet fall victim to companies that abuse our rights to fair and just treatment. alternately, email me at for questions related to this post.

protecting this industry does not only mean that we market ourselves for new business, but to ensure that new business coming in protects the resource that is most important in the organization: the people.


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