OJT as disguised exploitation

Finally, someone high up in government has raised the alarm about the rise of on-the-job training (OJT) requirements as a cover for unpaid or underpaid labor. Vice President Jejomar Binay has rightly called our attention to a phenomenon that opens the door to the exploitation of Filipino students. Abroad, such internships have been called the modern-day form of slave labor.

I hope the Commission on Higher Education (CHEd) will respond forthwith. It is complicated. If the OJT trade has flourished all these years, that only shows that it is in fact tolerated even by the students and their parents, and promoted by the schools.

VP Binay has alerted the CHEd to reports that students in hotel and restaurant management or other tourism-related courses are required to complete OJTs abroad as part of their studies. He was concerned that while they were made to perform the work of regular employees, they were paid little or no compensation at all. “These students are considered interns or trainees and are given training allowance but are being made to work full-time,” Binay said.

I have personally met many such Filipino trainees in Singapore, where they work in restaurants in fancy hotels. I am sure that these international chain hotels are professionally run, and that they meet local laws and standards for the treatment of employees. But I think that’s precisely where the problem lies. It is possible that the OJT interns actually fall through the cracks of both Philippine and host-country regulations. The interns are left unprotected by immigration and labor safeguards.

For instance, are they within reach of the protective arm of the Philippine Overseas Employment Agency? In other words, in the eyes of Philippine law, are they considered overseas Filipino workers, or are they akin to exchange students who spend time abroad for a fixed term? Just look at the government offices involved in this inquiry. VP Binay is also the presidential adviser on OFW concerns, and he addressed his concerns to the CHEd. This demonstrates the dual nature of the OJTs and the slippery modes of regulation. OJT interns are OFWs in almost every way except in law.

On the other side of the ocean, does the OJT arrangement merely enable the host-country employer to circumvent minimum wage laws? After all, theoretically speaking, the employer is in fact giving the untrained student an opportunity to learn. Why should the teacher pay the student? The employer is at best required to pay an allowance for the sustenance of the trainee, an amount that, by whichever reckoning, is well below minimum wages in the host country, but well above Philippine wages such that the Pinoy trainee has no reason to complain.

The CHEd has meanwhile announced that the Singapore OJT placements have been suspended for the past two years. There also exists a 2010 CHEd set of guidelines on “Student Internship Abroad Program … with Practicum Subject.” For instance, it requires “foreign partner entities” to cover the airfare, health insurance and housing costs of the trainees. Significantly, the CHEd requires the foreign host to pay at least 75 percent of the local minimum wages, plus uniforms and meals while on duty.

Those rules are pretty impressive but the solution merely underscores the problem. I’m sure the foreign “partners” still find it cheaper to hire our OJT trainees because, otherwise, why shell out round-trip airfare for a foreigner when local hire is available? Finally, I notice that there are local OJT placements even in local hotels in the Philippines. In other words, the risk of exploitation exists just as badly, or even worse, for Philippine-bound trainees.

The local schools are actually complicit in this entire scheme. One, they hold the power to draw the curriculum and to decide that, pedagogically speaking, you need OJT to learn how to wait tables. Two, in doing so, they actually structure the tourism industry to have a steady supply of OJT trainees year in, year out. In effect, the schools offer an army of discounted proles at bargain-basement prices, and everybody plays along.

Everybody, that is, including the parents. The kids and their parents see the OJT as an opportunity to break into the industry, as a de facto career placement program and, in the meantime, at least a way for the student to earn a little and augment the family budget.

That is why Binay’s inquiry is necessary. This is a practice that is self-perpetuating. The market sustains the supply and demand chain for OJTs. Both sides profit from the arrangement, the end-users legitimately (from cheap labor), the schools illegitimately (from contracting out their graduates to their hand-picked “accredited” hotels). And even the victims gain something: academic credits, allowances, if not a regular job. In the absence of a complainant, come to think of it, in the absence of a victim, only the government is in a position to step in, investigate and regulate.

I hope that, at the minimum, Binay’s query will lead to two reforms. First, by the schools, that they shorten the practicum requirement. These trade schools scarcely realize that, by elevating the hands-on OJT, they actually obsolesce themselves since all they can offer is “hands-off” classroom instruction. I have seen so many curricula drafted mindlessly and sanitized by academic bureaucrats. Second, by the lawyers and regulators, to enable our OJT trainees to get the most remuneration possible abroad and recognize them in all candor as quasi-OFWs.

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