Kevin Hince and

Jacqui Lynch

Labour Relations and Tripartism: The Relevance of the Philippines Model to the
Micro-states of the South Pacific
Kevin Hince and Jacqui Lynch
Abstract: The paper incorporates a statement of intent in respect to a long-term multi-stage
research project. The project will involve basic research, identification of related policy issues
and mechanisms for information transfer/education. This paper, the first report of the
project, also incorporates a synthesis of relevant background information and results of
research to date. The overall project is firmly rooted in a research-based, applied-policy
development, implementation and evaluation tradition. The project has two inter-related
objectives. First, the identification of the underlying values, constructs, institutions and
processes of the tripartite/social partner model of industrial relations that has evolved within
the Philippines in the period post-1986. Second, the identification/assessment of economic,
social/cultural, legal, political and other support and constraints to the transference of the
Philippines model to various Pacific micro-states. The research has been funded by grants
from the Internal Research Grants fund and the Faculty of Commerce and Administration,
Victoria University of Wellington.

Introduction
Industrial relations is about the relationships and inter-relationships between workers, groups of
workers (unions), managers and employers, groups of managers or employers (employers'
associations), industrial tribunals and government. Working within these relationships and interrelationships, the participants seek to establish the terms and conditions of employment, and the
way in which the employment relationship is to operate. Wages, hours of work, the length of the
standard working week, leave, issues of occupational health and safety, the conditions under which
workers are hired, fired and disciplined are some of the substantive issues that will be dealt with in
these inter-relationships.
There will also be many procedural issues to be dealt with, the most important being the
establishment of processes for preventing disagreements before they arise, for seeking to resolve
such disagreements that do arise, and, of course, to operate and administer the agreements that
emerge from the relationships.
It must be recognised that these relationships and inter-relationships of workers, unions,
employers, tribunals and government do not take place in a vacuum, but within the context of the
economic, social, cultural, political, legal, historical, geographical and technological environment of
the time and place.
The role expected of government is especially important, for government will inevitably be (and
more so in developing micro-states) a significant employer, as well as being responsible for
establishing national objectives and priorities, and for making and enforcing laws, not just in
respect to labour relations, but for the overall good order and government of the nation.
Government, through law-making, policy-setting and action as the dominant employer, will be
critical in creating, establishing, or perhaps imposing, the philosophies or value base upon which
action is predicated.
Papua New Guinea, Solomon Islands, Fiji, Western Samoa, Kiribati, Vanuatu, Tonga and the Cook
Islands with prior colonial relationship with the United Kingdom, Australia or New Zealand and all
English speaking (albeit with the bilingual case French/English of Vanuatu) are the micro-states
providing case evidence, and the focus of policy issues raised in this project. Debate as to the
philosophic or value base, and the appropriate form, structure and operational characteristics of
labour relations is an ongoing and common feature to each of these countries. The central issue is
which model, or adaption thereof, should and can be emulated.
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The Philippines industrial relations system: the American heritage

The Industrial Peace Act 1953 enacted by the Philippines legislature emphasised bipartite relations
through free collective bargaining. The legislation protected the employee rights to organise and
bargain collectively and simplified the procession for recognition (and registration) of trade unions.
The Court of Industrial Relations was to exercise jurisdiction over labour practices, and the
application and interpretation of the labour law. A conciliation service was established within the
Department of Labor with jurisdiction in both disputes of interest and disputes of right. Voluntary
arbitration was available in disputes of interest, with compulsory arbitration limited to disputes
affecting minimum wages and essential industries. Albeit with some modifications (for example,
union registration), it was the American Wagner Act New Deal model of industrial regulation.
The legislation also borrowed from the Taft Hartley Act 1947, outlawing closed shops, and
secondary boycotts and introducing the potential for 60 day cooling-off periods after strike threats.
The influence of the colonial power had continued into the post-colonial period; and unionism,
collective bargaining (bipartism) and the institutionalisation of dispute settlement became central to
the Philippines model of industrial relations. The Industrial Peace Act 1953 also introduced a basis
for tripartism, but it was not until the passage of the Labor Code (1974) that such arrangements
were formalised and became part of the processes of government policy formation. The Labor Code
also sought to enhance the business unionism, bipartite-bargaining model of labour relations.
The number of registered unions and coverage of collective bargaining surged in the period
immediately following the introduction of the Industrial Peace Act. American funding was made
available for education on collective bargaining, and related labour relations issues. However, in
the industrial context of the Philippines the transplanted model of exclusive representation and
enterprise bargaining led to a large number of small, weaker unions. Further weaknesses resulted
from the incompatibility of the enterprising bargaining model and the dominant employment sector
of small family business units. Organisation remained restricted to larger corporations, and interand intra-union rivalry was further increased by political differences. Federation of unions failed to
tackle these difficulties, and in fact further exacerbated problems as rival federations emerged.
The banning of the left-wing/communist federation, the Congress of Labor Organisation, was part of
a thrust to shift the Philippines trade union movement from a political base to a business unionism
model.
Labour relations developed and maintained a strong legalistic basis, and lawyers began to
dominate. Nevertheless, it is argued (Ofreneo, 1995: 215) that the legislative structure, together
with minimum wage protection and an embryo social security system covering employees, did lead
to a (generally) stable labour relations climate in the initial years. Patterns did change in the 1970s
and early 1980s, as the Marcos administration shifted from a democratic base to martial law.
Falling real wages and the general slowdown in the economy contributed to growing labour unrest,
especially after the devaluation of the peso in 1962 and 1970 (Ofreneo, 1995: 277). The declaration
of martial law, in September 1972, brought about a raft of restrictions on union activity
(particularly on strike action), and the reintroduction of compulsory arbitration. In exchange
employers were not allowed to dismiss workers without government permission. The Labor Code of
1974 prohibited government employees, supervisory employees, employees of not operating for
profit organisations and security guards from organising for the purposes of collective bargaining.
Wages were effectively frozen by government decree after going through the motions of calling
tripartite conferences . These repressive measures could be linked to the decline in strike activity
during the 1970s. However, the combination of political, social and economic upheaval in the early
1980s led to a resurgence in labour unrest. From a total of 155 strikes involving 33,638 workers in
1983, the number of strikes rose to 581 involving 169,479 workers in 1986 (Bureau of Labour and
Employment Statistics, DOLE).
The instability continued after the return of democracy with the Aquino administration in 1986 and
the further implementation of market-oriented structural adjustment policies. Initially the Aquino
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administration adopted a hard-line stance to stem industrial unrest, but State policy, developed
under the 1987 Constitution began to positively promote a social partnership model of labour
relations, and labour-management co-operation programs at enterprise level.
Positive benefits from the labour relations model evolved from the American heritage, enhanced by
the elements of the Labor Code, had to wait until the transition from martial law occurred in the
late 1980s. Nevertheless, the base of the modern Philippines industrial relations system had been
established, and transition to a more indigenous adaptation became a goal of the post-1986
administration.

The Philippines industrial relations system: the contemporary model

Transition forces
The emerging Philippines model of industrial relations is firmly focused on enhancing tripartite and
bipartite relations as a key pre-requisite for promoting industrial peace and productivity. Whilst
tripartism was involved under martial law to control the union movement and maintain downward
pressure on wages, it has now shifted to focus on building effective representative involvement in
consultative and decision-making processes. Since 1986 a range of social contracts has been
developed to facilitate constructive approaches to industrial relationships. The Tripartite Industrial
Peace Council, established in 1990, provides for regular regional and national tripartite
conferences, covering an expanding range of issues including, for example, productivity incentives,
social security and tax-exempt benefits for employees.
In 1992 the government facilitated the signing of a Social Contract for Development Based on
Justice and Peace between the Employers' Confederation of the Philippines (ECOP), the Trade
Union Congress of the Philippines (TUCP) and Labor Advisory Consultative Council (LACC). The
social contract focused on the promotion of industrial peace through strengthening tripartite and
bipartite mechanisms as well as encouraging welfare and employment development (Ofreneo, 1995:
316).
Worker and employer representatives are actively involved in the implementation of labour and
social policies and programs through their appointment to tripartite bodies. Dispute settlement,
minimum wage fixing, workers' compensation and training and skills development are some of the
issues covered by specific tripartite bodies, such as the National Labor Relations Commission and
National Wage Council.
Further, the social partners have representation on or are consulted by important policy-making
bodies, including the Energy Regulatory Board, the central bank, and the panel negotiating with
the IMF-World Bank to ensure that the principles agreed at national tripartite meetings are taken
into account (Tripartite Technical Committee on Structural Adjustment, 1994: 12).

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The bipartite relationship has also been enhanced with an evolutionary refocus on areas of cooperation and common interest. Collective bargaining is still the central pillar of the bipartite
system, but enhanced mediation services and a strong policy, and organisationally supported
program of voluntary arbitration, have been developed.
The concept of Labor-Management Committees, consultative mechanisms at the plant and firm
level, represent a further adaptation of the original bipartite model, and extend the co-operative,
collaborative nexus of social partnership to the factory floor. The LMC movement incorporates
elements of the lengthy tradition of democratic industrial relationships of the Scandinavian, West
German participatory models, and the plant level production cooperation focus of modern Japanese
industry, whilst building on an underlying Filipino cultural base of social co-operation.
Constitutional-legal base
The right to organise, collective bargaining and the right to strike (together with the restoration of
the rights of government employees to form unions) are guaranteed in the 1987 Constitution. The
Constitution also incorporates specific provisions aimed at protecting against unfair or
unauthorised dismissal.
Republic Act No. 6715, 1989 provides the statutory basis of the industrial relations institutions and
processes. The Labor Code, the Implementing Rules of the Labor Code, and Supreme Court
decisions are further elements of the regulation of labour-management relations in the formal
sector.
The Philippines ratified ILO Convention No. 98 (Right to Organise and Collective Bargaining, 1949)
in 1953, and Convention No. 87 (Freedom of Association and Protection of the Right to Organise,
1948) in 1957. It is one of just six member states in the Asia-Pacific region to have ratified the
latter convention. ILO Convention No. 144 on tripartism was ratified by the Philippines in 1991.
Elements of the model: the social partnership
Tripartism is a declared State policy. The Labor Code requires the Secretary of Labor to call
regional, industrial and national conferences of government, worker and employer representatives
for the consideration and adoption of voluntary codes of principles designed to promote industrial
peace based on social justice or to align labor movement relations with established priorities in
economic and social development (Republic Act No. 6715, 1989, Article 275b).
Tripartite activities are convened under the auspices of the Tripartite Industrial Peace Council,
which is chaired by the Labor Secretary and composed of 12 representatives each from the tripartite
sectors. Structural adjustment issues underpin much of the activity. Effort is ongoing to conduct
conferences/consultations on a regular rather than ad hoc basis, with consistent representation.
The Department of Labor and Employment (DOLE) and its associated agencies and bureaus,
provide the main government representation at these meetings. The DOLE also plays a critical role
in policy advocacy, employment promotion (especially related to safety net provisions), labour law
enforcement and various operational aspects of labour-management relation. Specific sections of
DOLE include:
National Labor Relations Commission (NLRC)
compulsory arbitration

in charge of deciding labour cases through

National Conciliation and Mediation Board involved with the settlement of labour disputes
through conciliation, mediation and the promotion of voluntary approaches to labour dispute
prevention and settlement
Bureau of Labor Relations handles appeal cases from decisions of the mediator-arbitrators
on intra-union disputes, and also the processing and registration of national unions and federations
Labor Inspectorate
Labor-Management Consultation promotion

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Bureau of Labor and Employment Statistics
National Wages and Productivity Commission
The Institute for Labor Studies (a research section, also incorporating the Labor Policy
Development and Evaluation Division.
Linked with moves to strengthen the bipartite relationship, government has also strengthened its
third party role in mediation, and voluntary arbitration. Government has also retained a direct,
interventionist role, in specific national interest disputes. A presidential decree can bring
intervention in industrial disputes in public utilities or export processing zones. In such cases the
Secretary for Labor assumes jurisdiction, strike, lock-out or associated activity is immediately
enjoined and the matter is referred to the National Labor Relations Commission for compulsory
arbitration. It should be noted, however, that membership of the NLRC is tripartite. The NLRC
also acts in cases of unfair labour practices, unfair dismissal, labour law enforcement and
interpretation issues.
The main employer grouping is the Employers Confederation of the Philippines (ECOP) which links
the Chamber of Commerce, Chamber of Industries and Personnel Management Association. ECOP
dates from the Marcos years emerging in response to a call for unified employer representation in
tripartite policy-making forums. Post-1986 government attempted to broaden input from small and
medium sized employing units. Such efforts are aimed at facilitating the decentralisation of
tripartism, with associated increased employer and labour input at industry and regional levels.
Low compliance with labour standards in the small-medium size firms was one catalyst for these
actions. To date, success has been limited, and organised employers remain that much less
representative.
Fragmentation of unions and a large informal sector are two significant factors limiting
representative input by labour. Union registration is obtained by meeting the test of being a
legitimate labor organisation . Recognition as a bargaining agent follows a majority vote in a
certification election, triggered by a written request of a minimum of 20 per cent of the members of
a bargaining unit. Legal status and exclusive representation follow success in the ballot.
In aggregate some 12 to 15 per cent of the 26 million work force are union members. However,
organisation only involves the work force in the formal sector. Membership of unions and union
federations in 1992 was estimated as 1,135,000 workers (Honculada cited by Ofreneo in Verma et
al., 1995: 211). Ofreneo argues that the limited size of the formal sector means only about 2.2
million workers are organisable into unions. Members are organised by some 8,000 unions, which
in turn are linked into some 155 industry regional (and sub-industry, sub-regional) federations.
The Trade Union Congress of the Philippines (TUCP) is the largest national centre coordinating
input from a large number of these federations. The Aquino government has broadened union
representation in tripartite discussion to involve non-TUCP union federations and other
independent labour organisations. Specific effort has been made to incorporate the more left and
militant labour grouping associated with the Labor and Advisory Consultative Council (LACC).
Progress has been slow, past divisions have been both lengthy and deep, but the central focus is
towards the fullest possible involvement of the tripartite social partners. The key feature is, of
course, the commitment to the philosophic base of social partnership, a commitment supported
constitutionally, legislatively and institutionally by government, and enhanced by the other pillars
of the emerging Philippines model
the bipartite vehicles of collective bargaining and labourmanagement co-operation at the enterprise level.

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The Department of Labor and Employment has recently increased the focus on facilitating the
establishment of industry tripartite councils, geared towards addressing the concerns of particular
industries. Such councils are also seen as providing a potential springboard for the adoption of
labour-management cooperation schemes at the enterprise level.
The tripartite partners,
individually and collectively, appear committed to ongoing progress. A forward looking, integrated
program for future policy and action, was developed (by tripartite discussion and consensus
building) at a National Tripartite Seminar on Workplace Labor-Management Cooperation and
Consultation, held in Manila in February 1995. It was noted (Baldoz, 1996) that the often highly
emotional debates on the ideology underpinning labour-management co-operation were absent from
the discussions.
Areas of consensus included:
recognition, and acceptance, that unions and collective bargaining can co-exist with labourmanagement co-operation schemes
(moreover) an acceptance of active union involvement in the operation of such schemes
government was expected to maintain a positive role in education, facilitation and
encouragement.
Elements of the model: collective bargaining
Collective bargaining, operating at the enterprise or plant level is the cornerstone of organised
industrial relations in the Philippines. Nevertheless, the absence of union organisation in the
dominant informal sector, and weakness in the smaller formal sector, results in a very low coverage
of collective bargaining agreements (CBAs). In March 1996, 3,322 CBAs extended coverage to
384,000 workers (Baldoz, 1996:8), about 1 per cent of the total workforce (albeit a higher proportion
approximately 17 per cent of the workforce in the organisable , formal sector. An apparent
discrepancy/anomaly between union membership and CBA coverage estimates can be explained by
artificially boosted union membership figures (see Deery and Mitchell, 1993: 231), failure of unions
to achieve representation and the existence of a social role in areas of the labour movement.
Government acts to establish and monitor the rules for bargaining, and provide technical and
awareness education. DOLE agencies also have an interventionist role in disputes, but the
emphasis is on facilitation, and encouragement for self-determination (mediation and voluntary
arbitration). Procedures for collective bargaining are provided by the Republic Act No. 6715, the
New Labor Relations Law, 1989.
Recognition and exclusive representation procedures, including the process of election petition and
certification ballot are established. Representation has a five year term. Labour organisations
must have rules meeting basic provisions for internal democracy (secret ballot, majority support for
action and protective/appeal procedures). Refusal to bargain with a recognised agent is an unfair
labour practice. Collective agreements must include a grievance procedure. Agreements freely
entered into cannot be interfered with, except where jurisdiction is allowed in the Labor Code (for
example, interpretation, grievance or unfair labour practice issues). Collective agreements are
limited to a maximum three year term, and a file of agreement, and related matters is maintained
by a DOLE section, the Bureau of Industrial Relations.
If differences cannot be resolved by direct bargaining the National Conciliation and Mediation
Board (NCMB) can intervene, at the request of either party or at its own initiative. Acts by the
parties which may disrupt or impede settlement are prohibited during Board supervised
proceedings. A 30 day cooling-off period is required by law after an impasse is reached in disputes
of interest. Fifteen days cooling-off is required in cases of unfair labour practices. Strike ballots
must be conducted and a further seven-day period must elapse are reporting ballot results, before a
strike can be declared. Voluntary arbitration is now a central pillar supporting bipartite
determination in labour-relations in the Philippines.
It can also be noted that tripartite mechanisms have begun to simulate the collective bargaining
process at industry or regional level, especially in relation to minimum wages, thus providing an
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indirect influence on workplaces without collective bargaining agreements.
The 1987 Constitution has clearly confirmed the right of workers in the public sector to organise
and engage in collective activities, including strike actions. Collective bargaining, however,
remains a right which is still to be clearly defined, with guidelines and procedures yet to be fully
established. Currently government employees are prohibited from engaging in strikes for the
purpose of changing terms and conditions of employment (Deery and Mitchell, 1993: 228).
Public sector unions in the Philippines do not normally register as legitimate labour organisations
under the Labor Code, but as registered employees organisations under Executive Order 180s.8.
Public sector agencies and unions negotiate collective negotiation agreements rather than
collective bargaining agreements but the difference is not formally enunciated. One difference, it
is suggested (Effron, 1994) is that while collective bargaining agreements are clearly enforceable,
the enforcement of collective negotiation agreements is uncertain, and fraught with potential
technicalities.
Elements of the model: voluntary arbitration
Positive support for voluntary arbitration is based on acceptance of the principles that when labourmanagement differences arise they should be settled at the workplace by the parties themselves;
and that when deadlocks do occur resolution should be by a third party chosen by both sides, and in
whose competence, integrity and sense of fairness they have absolute trust.
Voluntary arbitration was introduced in the Philippines as early as 1953 and institutionalised in
the 1974 Labor Code. For many years its operation was hampered by legal and procedural
problems, lack of funding support to finance sustained promotional and educational activities,
including the continued training of accredited voluntary arbitrators, and by the general adversarial
context of the times. Compulsion was a preferred and dominant regulatory tool.
The 1987 Constitution provided for the positive promotion of voluntary modes in settling disputes
signalling a marked departure from the previous emphasis on compulsory resolution. The National
Conciliation and Mediation Board was created in the same year to administer the voluntary
arbitration program. The Tripartite Voluntary Arbitration Advisory Council was attached to the
NCMB, primarily to play an educational role for practitioners. Voluntary arbitrators are accredited
by DOLE and include judges, law professors, industrial relations practitioners, clergymen and
prominent members of the community.
In 1989, Republic Act No. 6715 amended the Labor Code to further strengthen the voluntary
arbitration framework. Amendments provided, inter alia, that voluntary arbitrators have original
and exclusive jurisdiction to hear and decide all unresolved grievances arising from the
interpretation or implementation of the Collective Bargaining Agreement, and those arising from
the interpretation or enforcement of company personnel policies . Even unfair labour practices and
CBA deadlocks can now be resolved through voluntary arbitration upon agreement of the parties.
A special fund to subsidise the cost of the process was also set up. The informality and reduced
legalism of voluntary arbitration is considered more appropriate to Filipino culture than
compulsion.
The National Conciliation and Mediation Board reported that 295 cases had been submitted to
voluntary arbitration in 1995, a 3 per cent increase on the previous year, and bringing the total
number of cases handled to 1,460 since formation (NCMB, 1995: 7). While NCMB initiatives
continue to be the main source of cases referred for voluntary arbitration, the board has noted an
increasing awareness and maturity on the part of labour and management as to the merits of the
system. An increasing number of cases are being submitted directly by the parties. Most of the
cases in 1995, as in previous years, involved employee discipline (190) and contract interpretation
(81). Other issues raised included: interpretation of wage orders (9), wage distortion issues (9)
other issues related to wage and salary administration (2) and collective bargaining deadlock (4).
In 1995 the Tripartite Voluntary Arbitration Advisory Council established an expedited procedure
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for one-day voluntary arbitration of labour-management disputes of simple cases . It also made the
Special Voluntary Arbitration Fund more accessible to parties to labour disputes, particularly trade
unions.
Elements of the model: labour-management co-operation (LMCs)
The Labor Code 1974 required all collective bargaining agreements to contain provisions for labourmanagement cooperation directed towards the improvement of the quality of worklife and
productivity enhancement. These mechanisms were to focus on areas not traditionally covered by
collective bargaining. The Department of Labor and Employment was charged with promoting
these schemes. It is now accepted, however, that progress was minimal
efforts were more of
paper compliance or just lip service. Dominant elements of the general political and economic
context, together the adversarial nature of industrial relationships, mitigated against success.
Progress was minimal, government agency support was more nominal than real. However, positive
changes have emerged post-1986, with the changed political environment and the philosophy and
reality of the new Constitution.
Article XIII, Section 3 of the 1987 Constitution granted workers the right to participate in the
decision-making processes in the establishments where they are employed. Republic Act No. 6715,
1989 put this policy into statute by providing for the establishment of labour-management councils
(LMCs) on matters which directly affected workers' rights, benefits and welfare, with elected
worker representatives in both unionised and non-unionised firms. The DOLE was required to:
conduct awareness campaigns on the need for labour-management councils
assist workers and employers in setting up labour-management cooperation mechanisms
provide facilitators in LMC meetings
monitor activities of LMCs.
The task of promoting labour-management cooperation fell to the NCMB for unionised
establishments, and to the regional offices of DOLE for non-unionised firms.
Self-help, assistance by private agencies and employer bodies (the Personnel Management
Association of the Philippines, for example, was a positive force), and efforts of the NCMB has
resulted in the establishment of some 709 LMCs nationwide since 1988. Almost all of these operate
in unionised firms. Progress in the non-unionised sector has been minimal to date, and where it is
occurring there is an emerging suspicion that management is using these mechanisms to prevent
unionisation. Small-scale and family ownership has also mitigated against unionisation, collective
bargaining and the establishment of LMCs in a large sector of the Philippines industry.
However, whilst the philosophies of social partnership, tripartism and bipartism, within a context of
political democracy are accepted as cornerstones of industrial relations and industrial stability,
progress towards industrial democracy will be maintained. Hince et al. (in preparation) reports
cases and assesses progress in more detail.

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The hypothesis(es)
The initial hypothesis is that the emerging industrial relations model in the Philippines is an
appropriate, relevant and, in fact, preferred model for adaption and adoption in the micro-states of
the modern South Pacific. The hypothesis is, perhaps better expressed in three parts. First, the
tripartite, bipartite accommodation model operating at national and enterprise level in the
Philippines is in tune with the traditional, cultural norms of the South Pacific societies. Further,
that model will provide a better performing economic model, with greater social cohesiveness, than
alternative approaches.
Second, tripartism and bipartism in industrial relations emerged in the Philippines in the latter
days of colonialism and earliest days of a post-colonial society. It was adaptive of the American
heritage. Immediate success became overshadowed by traumatic contextual changes involving
mounting overseas debt, and the Marcos regime and martial law. The restoration of democratic
government after the coup of 1986 was followed by a re-emphasis of the tripartite/bipartite
philosophy with constitutional, legislative, and institutional support. After a period of readjustment this approach has led to sustainable industrial peace and stability, and is demonstrably
contributing to the catalogue of economic progress (industrialisation, competitiveness and economic
growth) that is being documented.
A third part to the hypothesis can place the total debate in a more precise position. If the microstates of the South Pacific believe, as is the general position, that an Asian model(s) or approach is
the way of future economic progress, then an awareness may need be created that the
authoritarian, non-collectivist, control focus type is not the only Asian model. Perhaps the
Philippines, with a clear, distinct and different approach to industrial relations, may be the more
appropriate case to emulate.
In the Philippines strike levels, the overt measure of industrial peace/conflict, have declined to
exceptionally low levels. Whilst 904 strike notices were issued in 1995 only 10 per cent resulted in
stoppages. A similar level of activity (44 strikes) occurred in the first six months of 1996.
Intuitively (at this stage) the increased inward flow of foreign investment and the expansion of
industrial output in the Philippines can be linked to stability in industrial relations. In addition to
these economic gains labour involvement in policy-making can also be linked to the recent
enhancement of legislative protection for several groups of highly vulnerable workers, notably
homeworkers and overseas workers.
Baldoz (1996) attributes the recent development and maintenance of stability in labour and
management relations to a number of factors, including:
increasing effectiveness in the use of tripartite mechanisms, at various levels of the economy,
for consultation on policy issues affecting labour and employment
efficiency, credibility and effective use of the government machinery for dispute settlement,
particularly conciliation-mediation, voluntary arbitration and the grievance machinery
sustained promotion of the concepts and processes involved in workers' participation in
decision-making processes to include both collective bargaining and labour-management
cooperation schemes
growing maturity of both labour and management to respect each others' rights and
compliance with their respective obligations
government efforts through policies and legislation that liberalise the labour relations system,
particularly in the area of trade union administration.
Clearly further issues remain to be addressed. The trade union movement remains fragmented and
weak. Labour and employer input often lacks representativeness, especially from the informal,
agricultural and small business sectors. Poor secretariat support and lack of permanence of
representatives often minimises effectiveness of both union and employer input. Some government
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actions, including the declaration of essential industries to end disputes, have increased levels of
distrust. The growth in export processing zones with constraints on union activities, and
increasing use of labour casualisation, are placing further pressures on the organising task of
labour and lead to ongoing concerns about worker vulnerability. Initiatives aimed at enhancing
labour-management co-operation at the enterprise level are often (and clearly with both historical
and contemporary reasons of good cause) viewed with suspicion by workers, unions, and on occasion
by management. Nevertheless, the social partnership model, emphasising constructive joint and
collective approaches to issues at all levels, is now central to the ongoing search for solutions and
applications within the industrial relations system of the Philippines.
Each of the micro-states of the South Pacific region has a strongly indigenous culture of
communalism, all-embracing dialogue and consensus building. Those States subjected to British,
Australian or New Zealand colonial rule had a legislative base focused on collectivism and bipartite
relations (albeit with an overriding paternalistic role for the State) in the conduct of labour
relations. Whilst control was a core rationale of government behaviour in the industrial
relationships of the colonial era the legislation was reflective of the late 19th and early 20th century
Anglo-Saxon model, albeit of a less voluntaristic nature than the basic British model.
However, more recently pressures to industrialise, attract foreign investment, increase productivity
levels and competitiveness (more often than not based on compliant cheap labour) have created an
environment where less democratic, participative and inclusive relationships have emerged. The
luxury of independent trade unions and collective bargaining is being questioned more frequently
and more widely. Diminished emphasis on social partners input, on structures which diminish
autonomous action, and which subordinate both management and labour to increasing degrees of
government control, are occurring (Hess, 1986: 230; Hince, 1995 various). Countries of the Asian
region which have experienced rapid industrial and economic growth with similar or more
controlled labour relations institutions and processes are being looked to as potential role models.
The real challenge, for the micro-states of the South Pacific, is to resolve the dilemma by reconciling
the indigenous cultural base with the needs of modernisation. The hypothesis is that the Philippine
model of social partnership, tripartite and bipartite relations functioning at all possible levels of
interaction is a viable, realistic and more sustainable model to emulate.
Subsequent stages of this applied policy based research will seek to:
identify more precisely the contribution of the Philippines social partnership approach to the
stability of industrial relations, and economic and social progress in that nation, overall, and in
individual enterprises
identify and assess the economic, social/cultural, legal and political constraints and support
for the transference of the Philippines approach to the micro-states of the South Pacific
outline the mechanisms for development, information transfer, policy development and
implementation of the appropriate model in specific nation States.

References
Baldoz, R.D. (1996) The current status of LMC in the Philippines. Discussion paper for the
Seminar on Labor Management Consultation: A Strategy for Productivity Improvement, Pasig
City, Philippines, September 5-6, 1996.
Deery, S.J. and Mitchell, R.J. (1993) Labour Law and Industrial Relations in Asia. Australia:
Longman Cheshire.
Effron, J.E. (1994-95) Collective negotiation agreements in the public sector: what do they really
mean? Philippine Journal of Labor and Industrial Relations XVI (1 & 2).
Employers Confederation of the Philippines (1996) Country Report for the Asian Pacific Regional
Tripartite Seminar on Workplace Labour-Management Consultation and Cooperation. Bangkok,
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