Virgin Job Orders, Shady Rules & Money Making Scheme (Billion Peso Business) in POEA - Time to Investigate, Wake-Up Call !!!

Wazzup Pilipinas!

Here is an open letter to the POEA Administrator and the DOLE Secretary concerning the issues of Virgin Job Orders, Shady Rules and Money-Making Schemes supposedly happening within POEA


24 July 2018

Bernard Olalia
POEA Administrator

Silvestre H. Bello III
DOLE Secretary, Chairman

CC: ​ARISTODES R. RUARO, Deputy Administrator, Licensing and Adjudication
CC: VILLAMOR VENTURA S. PLAN, Deputy Administrator, Employment and Welfare
CC: LEVINSON C. ALCANTARA, OIC - Pre-Employment Services Office
CC: ARLEEN S. BASAS, OIC - Adjudication Office
CC: RIA CORAZON S. LANO, Director IV - Licensing and Regulation Office
CC: Sherilyn G. Malonzo, Director II-AIRB
CC: Rommelson E. Abbang, Chief Operations and Surveillance Division
CC: Lynda Llave, OIC, Licensing Branch
CC: Esteban Arnel O. Allarde, OIC - Adjudication Branch
CC: Marieta S. Labong-Dela Cruz, Director II, Recruitment and Regulation Branch


Dear Admin. Olalia,

We would like to bring to your attention the ongoing impalement of the agencies under probationary period which is covered under the new POEA rules revised on April, 2016.

We understand that POEA has a vital role in implementing the government policy of providing full protection to Overseas Filipino Workers (OFW). And allow us therefore to acknowledge both the POLO and POEA for serving the needs of our OFWs in and outside the Philippines.

However, this is a fitting opportunity to raise our concern about the POEA rules particularly the upgrading of a provisional POEA license to a full license to the recruitment agencies.

In the POEA revised rules, the provisional POEA license agency must acquire at least 100 Virgin Job Orders and deployed 100 workers within two (2) years of operations. The condition for a Virgin Job Order is from a foreign principal who have an existing business registered at their respective country with more than one (1) year and have never engaged with any recruitment agency in the Philippines.

In the previous POEA rules, the Virgin Job Order is for any foreign principal who have not worked with any recruitment agency in the Philippines as well as the foreign principals that are registered at the POEA and have deployed workers to any recruitment agency but found inactive for 6 consecutive months.

This a clear concern that Some Board Members​ deliberately find an opportunity to complicate the process of Virgin Job Orders and there’s a big loophole - who benefits from this revision made by the
POEA?

There are various countries who deploy workers overseas and their government has no conditional clause pertaining to Virgin Job Order in the recruitment industry. This is yet an another “Only in the Philippines”​ contorted ways. We have this poignant unattainable requirement which pretense corruption inside the POEA. In our opinion, the whole Virgin Job Order should be abolished and probationary license to regular license must be based on 100 deployment without imposing a conditional validity.

As a recruitment agency (provisional or with full license), the POEA mandates that a recruitment agency shall set up an escrow account to cover possible future liabilities arising from claims of overseas contract workers due to employment contract violations. The release of escrow which is deposited in a POEA-accredited bank is ordered by either the POEA or the National Labor Relations Commission.

Recruitment Agency spends so much resources and efforts just to set up its operations. As you are aware, any business has an incubation period. Most of the investment done for accruing the licenses, office setup, staffing, overseas marketing expenses, etc, the return of investment (ROI) is estimated in 4 to 5 years’ time.

Please allow us to outline below how challenging it is to acquire Virgin Job Orders considering the market conditions for the past 3 years. The labor market has been drastically slow, this can be seen on the total Job Orders and deployment of the existing agencies have acquired.

Having said that, how much more challenging in getting Virgin Job Orders?

1. Virgin Accounts have hesitations in working with provisional POEA license agency as there is no solid track record yet. This is especially when we go after the big companies. Vendor Registration requires an excellent track record and they usually ask some client testimonials which provisional agencies do not have.

2. In relation to item #1, some foreign principals try to use this opportunity to their advantage to get a favorable recruitment fees which leads the agencies to a compromising situation. Some may even demand to a free recruitment cost due to lack of track record and credibility. Indeed a tough competition on Virgin Job Orders. The new agencies are forced to take the orders due to the time constraint preset conditions set by POEA​. This is creating an unhealthy competition between the agencies and also an opportunity to compromise on the POEA deployment rules such as the documentation, insurance fees to be paid by the client and alike​. POEA has issued more than 100 provisional license to recruitment agencies in the past 2 years. That being said, getting Virgin Job Orders is really very tight competition in the market with all the agencies competing to get the total 10,000 Virgin Job Orders.​ Now the news is spread in the existing labor market that there are many agencies who are willing to take job orders free of cost from Philippines including free ticket provided by agencies for deployment​. ​Nevertheless to say the 100 Nos Virgin Job order scheme is adversely affecting the business ​of all the POEA licensed agencies.

POEA IS SETTING THE RULES AND FORCING THE AGENCIES TO BREAK THE RULES !!

3. Virgin Job Orders ideally comes from new market / country. This leads to another crucial step as we do not have POLO or Philippine Embassy in new market / country. The client with the help of the recruitment agency need to check the nearest POLO or Philippine Embassy that is within the jurisdiction of that particular country. Some clients may not be as cooperative because of this tedious process.

At times, POLO or POEA issues deficiencies which may also vary due to constant
changes in the rules. This back and forth, oftentimes prevents us in pushing through in getting a Virgin Job Order. Most recruitment agencies under provisional POEA license are doing every means possible and yet it will just be gone to be wasted. Currently, to accredit a Virgin Job Order from a new market is taking more than 3 to 4 months and much of the hurdles are faced at the POLO office nevertheless to point out upon verifying the documents and the delay at the POEA accreditation department now surpass more than 60 days.

On another note, we would like to know the stand and how POEA will address the following situations:

1. What will happen to the OFWs that has been deployed by the agencies with provisional license that has been expired and where not given the extension?

2. What will happen to the Virgin Job Orders and other principals that the expired agency acquired? If these foreign employers will just be taken granted, this will give a very bad impression with the Philippine Agencies​ & POEA.

3. During the probationary period the agencies are allowed to acquire any type of job orders. When an agency is suspended or canceled the other agencies can acquire these Job orders without assuming any responsibility on the deployment. The severity for deployment cases on Virgin Job Orders ​are more and the agencies are left out of business to handle this matter. POEA still can count on the escrow deposits and the Culprits​ inside POEA can make more money with various inside trading deals​. This is just an icing to the other ongoing corruptions happening inside the POEA.

Evidently, POEA is ridden with termites​ just waiting for an opportunity.

3. Currently there are more than 100 Recruitment Agencies that are under the provisional POEA license. On a rough estimate, the recruitment agencies spent 20M to 30M on its 2 years operations
(100 x PHP30M = PH 3 Billion ). As per the new rule, if the recruitment agencies do not comply the condition of a Virgin Job Order their license will be cancelled, and all their efforts gone in vain with huge financial implication on the agency owners. We have solid information that some group inside POEA is using this opportunity to get all the leads on their clients and sell to the different existing agencies. We are aware of this inside trade as this has been a practice for a very long time. A convenient way for the corrupt inside POEA to extort more money from several agencies.

4. Currently there are agencies who have requested for an extension since January, 2018​ of their provisional license but got denied based on the new rules. This has been the scenario for the last 8 months​. The licensing department is keeping a blind eye on this matter and deliberately delaying a
resolution ​with various burocatic reasons. Furthermore, the grievances of the agencies have been addressed by the Private Sector Representative, Ms. Estrelita S. Hizon​. She supports and recommends to the board to approve the request for extension of provisional license with a minimum number of 50 Virgin Deployment. If the respected board member in any way aware about the issues that the agencies are facing just to get the Virgin Job Order, she should recommend for an extension without any preset conditions. POEA should be aware about the intention​ behind this recommendation and request by this governing board member who also owns an agency business.

Moreover, we would like to bring this to your attention regarding a syndicate and their agents with the support of few Board Members, Directors and Officers from POEA threatening and extorting an exorbitant amount of money from the newly licensed agencies to fix the extension or to fix the provisional to regular license with various offers. All these point to the licensing department and the key decision makers there who are deliberately delaying an immediate resolution to end this money
making scheme at POEA. Any further delay, we will be forced to expose the names of the culprits benefiting from the 100 Virgin job order schemes.

We believe that your leadership on this matter would send a powerful message to the POEA that could prevent further mishap.

We respectfully ask you to urge the governing board members to uphold its responsibility to protect the OFWs as well as the recruitment agencies and employers, and to specifically ask POEA to take the following key steps:

● The condition in the provisional license pertaining to the 100 Virgin Job Orders should not be limited to 2 years or the Virgin concept should be completely abolished. There should not be a conditional clause of non-extension of license.

● There is a long back and forth thread about the issue and compliance between the agency and the employer. In this note, we made a lot of critical decisions because of the disruptive influence of requirements which we cannot able to see the importance of these requirements. It will only lead to employer’s decision not to hire a Filipino Workers that can result to significant rise of unemployment rate of Overseas Filipino Workers. To sum things up, it is a big risk because of this process and procedure. We believe that we are losing opportunities for the Filipino Workers because of the tedious procedure.

For some workers, going abroad is the only option. It can be improved significantly if only POEA can take a strong stand and commitment. Commitment in setting the rules by promoting Filipino Workers, providing fair rules to the recruitment agencies, and fast track the accreditation procedure. It’s very surprising that POEA is an ISO Certified organization and yet the turnaround time seems to be sluggish.

● We would also like to appeal for the revision on set rules for those agencies having provisional license where the 100 Virgin Job Orders are required. We believe that this is not vital in promoting Filipino Workers and getting employers across the globe.

The POEA must send a clear and powerful signal as the governing body that protects the interest for all the concerning parties as state above. We sincerely hope that we have conveyed a very exigent matter that needs your speedy action.

We are expecting an immediate intervention on the extension of the provisional license of these recruitment agencies who are not just affected but are also being exploited by the POEA Officials pertaining to the 100 virgin Job order scheme.


Sincerely,

Dalisay T. Bernal