Formerly known as PLDT Company, PLDT Inc. is among the leading and largest telecommunication companies in the Philippines that offers a wide range of telecommunications and digital services across the country from fixed to wireless connections with varied prepaid and postpaid payment schemes. PLDT was established on November 29, 1928 through Act No. 3436 that was signed by then American Governor-General Henry L. Stimson (“Today in Philippine History,” 2012). The first owners of the company were Americans, and Theodore Vail Halsey was its first president. Then finally by 1968, PLDT became a Filipino-controlled company with its leadership under Ramon Cojuangco and his group of Filipino industrialists and businessmen.
Of its long history of innovations, business ventures and partnerships, one of PLDT’s significant events is when its subsidiary Mabuhay Philippine Satellite Corp. successfully launched Agila II, the country’s first communications satellite. PLDT also established partnerships with international telecom giants AT&T, Oracle Corp. and NTT Communications Corp. of Japan.
By 1998, PLDT announced the entry of First Pacific Co. Ltd. that acquired 17.5-percent of its stake. Then, Manuel V. Pangilinan, a well-known Filipino tycoon and First Pacific executive officer became the President and Chief Executive Officer of PLDT up to the present. Currently, Pangilinan is also the concurrent Chairman of PLDT and its subsidiary Smart Communications, Inc (“Management Committee,” n.d.). Aside from Smart, the company also acquired Digitel Mobile Philippines, Inc. or commercially known as Sun Cellular in October 2011.
For the year ended 2019, PLDT reported revenues of Php 169,187 million, expenses of Php 129, 786 million and net income of Php 22,786 million. The company also reported as of December 31, 2019 total assets of Php 525,027 million, total liabilities of Php 408,737 million and total equity of Php 116,290 million (PLDT Inc., 2020).
In quest of business upgrade and savings increase, PLDT and its subsidiary Smart Communications, Inc. (Smart) inked million-dollar outsourcing contract. The companies entered the US$300 million seven-year Managed Transformation Agreement on January 24, 2018 with the multinational Missouri-based company Amdocs, a leading provider of software and services to communications and media companies (PLDT Inc. and Subsidiaries, 2018). According to Amdocs:
The Managed Transformation Agreement among PLDT, Smart and Amdocs involves transformation services which include the development of state-of-the-art, digital capabilities for Convergent Sales Operations, Digital Customer Experience across multiple channels, and Service Fulfillment and Network Rollout Systems, among others. The Agreement also involves managed services that cover the operation and modernization of the IT [Information Technology] environment of PLDT and SMART encompassing application development and maintenance across critical IT components, such as Customer Relationship Management, Billing, Subscription and Campaign Management, amongst others. (2018)
Moreover, Amdocs stated that PLDT and Smart upgrades come with the integration of artificial intelligence (AI), machine learning and other advanced technologies in the companies’ business technology systems.
As reflected on PLDT’s consolidated financial statements, generally the agreement aims “to upgrade PLDT’s business IT systems and improve its business processes and services, aimed at enhancing consumer satisfaction, reducing costs and generating increased revenues” (PLDT Inc., 2018). In a report by Chrisee Dela Paz (2018) on Rappler, Manuel V. Pangilinan said that with this outsourcing move, the companies will be able to boost their growth and position themselves “to take the lead in the next wave of digital innovation”. As Pangilinan added, “it is a partnership in real terms”. In this outsourcing transaction, PLDT and Smart were advised by the firms Allen & Overy, SyCipLaw and Deloitte Consulting Southeast Asia (Dela Paz, 2018).
By pursuing the outsourcing agreement and therefore reducing manpower of its IT department, PLDT projected Php 7 billion savings over the next few years (Amojelar, 2018). However, due to the said reduction in PLDT’s IT manpower brought by its outsourcing decision, the company is facing backlash from employee unions. To note that according to Pangilinan, PLDT has more than 1,000 staffs in its back-office IT operations as reported in the article by Dela Paz (2018). Of this figure, there is no report stating the exact number of employees that will be affected by PLDT’s outsourcing move. In the same year 2018, together with the news of its outsourcing decision, PLDT announced that the company’s IT units were offered career opportunities as regular employees in Amdocs. Pangilinan was even optimistic by saying that the displacement “represents a unique chance for these IT people to further build their careers in one of the leading software and services companies in the world” (Dela Paz, 2018). But the Gabay ng Unyon sa Telekomunikasyon ng mga Superbisor (GUTS) condemns PLDT’s move to outsource its IT department and the other departments of the company as well (BicolToday.com, 2018). According to the same article from BicolToday, the employees are even “threatened and forced to sign new contracts with the outsourcing company Amdocs,” and “letters from top bosses of PLDT were sent to each affected employee to sow fear and intimidate the employees”. The employees affected by the displacement only had until April 2 of 2018 to work in PLDT. And according to an article by Kenneth Roland Guda (2018) from pinoyweekly.org, the company has already started to condition the minds of their employees about their outsourcing scheme since 2016. In Guda’s article, GUTS president Charlito Arevalo was reported to say that an initial of 88 PLDT supervisors under the IT Department were given notice by the company that they will be removed as regular employees and will be relocated to contracting agency Amdocs. Protests and strikes were then executed by GUTS and the union Manggagawa sa Komunikasyon ng Pilipinas (MKP), with the latter complaining about PLDT’s history of contractual employment.
The Department of Labor and Employment (DOLE) ordered PLDT in a series of issued orders from July 3, 2017, followed by DOLE Secretary Silvestre H. Bello III resolutions dated January 10 and April 24 of 2018, to regularize 7,344 workers from 38 of PLDT’s third party service contractors (PLDT Inc., 2018). PLDT questioned the regularization orders and on July 31, 2018 the Court of Appeals released its 47-page decision. According to the said decision, the court voided DOLE’s order for PLDT to regularize its manpower of janitors, messengers, clerks, call center and sales agents, personnel in IT support services, back office support and office operations, among others (Depasupil, 2018). According to the same news article by William Depasupil (2018), the Court of Appeals only considered regularization for workers of contractors performing installations, repairs, and maintenance services of the company’s lines. Furthermore, the article reported that the Court of Appeals stated that “PLDT did not violate any law when it did not regularize the business processing outsourcing (BPO) and information technology (IT) support personnel,” and that “contracting out services is not illegal per se” (Depasupil,2018).
The latest update that the researcher can find regarding PLDT’s aforementioned labor issue is referenced from a 2019 news article by Samuel P. Medenilla (2019) on BusinessMirror’s website. According to Medenilla’s article, DOLE elevated its pending workers regularization case against PLDT to the Supreme Court.
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