Philippines: Philippine Economic Zone Authority issues guidelines on alternative work arrangements during enhanced community quarantine

Following the declaration by the Philippine government that the Greater Manila area or “NCR Plus” (comprising Metro Manila, Bulacan, Rizal, Cavite and Laguna) will be placed under enhanced community quarantine (ECQ) from 29 March 2021 until 4 April 2021 (unless further extended), the Philippine Economic Zone Authority (PEZA) on 27 March 2021 issued PEZA Memorandum Circular No. 2021-024 (“Circular“), allowing ecozone IT enterprises to implement courses of action to ensure continuity of operations and non-interruption of services during the ECQ period.

What the Circular says

The Circular authorizes ecozone IT enterprises to implement the following courses of action during the ECQ period, without need to obtain a prior letter of authority from PEZA:

1. Allow its employees to work from: (a) home; (b) other PEZA-registered sites of the IT enterprise; (c) PEZA-registered IT parks/centers where the IT enterprise has no registered facility; or (d) other sites/buildings that are not PEZA-registered IT centers
2. Bring-out IT equipment and other related assets/peripherals from its PEZA-registered sites for deployment to its employees who are working from home or at alternative work sites

Requirements

Ecozone IT enterprises that wish to the avail of the alternative arrangements under the Circular must comply with the following requirements:

1. Within the day following its implementation of any alternative arrangements, the ecozone IT enterprise (through any of its top three officers as identified in its Ecozone Monthly Performance Reports (EZMPRs) submitted to PEZA) must send an email to its PEZA Zone Administrator/ Zone Manager/ Officer-in-Charge, to notify the latter of the following:
   1. specific course/s of action and arrangement/s implemented, indicating: (i) whether employees will be working from home, at the ecozone IT enterprises’ other sites, or other non-PEZA registered sites/buildings; and (ii), in the case of another building or site, the building or site name and location
   2. for movement of IT equipment: (i) date of actual withdrawal of IT equipment; (ii) a generic description of the equipment withdrawn from the PEZA-registered site and deployed to employees for alternative work arrangements; and (iii) the number of units thereof

   The ecozone IT enterprise must send a separate email notification to PEZA for each day that equipment and assets are brought out of its PEZA-registered facility.

   1. Within seven days from withdrawal of the IT equipment from its PEZA-registered site, the ecozone IT enterprise must submit the following documents (by email) to its PEZA Zone Administrator/ Zone Manager/ Officer-in-Charge:
      1. the corresponding PEZA Permit Form 8106 (Farm-out permit application) and required annexes thereto, covering the IT equipment brought out of its PEZA-registered site
      2. list of all IT equipment brought out of its PEZA-registered site, with information on quantity, source, acquisition cost and book value thereof, duly certified by a responsible officer or authorized representative of the ecozone IT enterprise
      3. a surety bond to cover 150% of the amount of duties and/or VAT on the IT equipment brought out of its PEZA-registered site; enterprises must coordinate with the Bureau of Customs through the PEZA Zone Administrator/ Zone Manager/ Officer-in-Charge to secure the bond within the seven-day period.
      1. The employees assigned to work outside their base office shall be informed of their temporary work location (if other than their homes) prior to deployment.
      2. All employees deployed to work from home / other sites shall receive the same work load, salary and benefits, including overtime and night differential compensation, among others, that they are entitled to under their existing contracts of employment in their base offices.
      3. The ecozone IT enterprise shall observe and comply with all applicable labor laws, rules and regulations relative to said deployed employees.
      4. The ecozone IT enterprise shall be responsible and accountable for data privacy in accordance with applicable laws, rules and regulations, and it shall adequately inform its deployed employees of data privacy rules and regulations while working outside their base offices.
      5. The ecozone IT enterprise shall comply with applicable provisions and requirements, rules and regulations of the Telecommuting Act (R.A. No. 11165).
      6. Work-from-home operations or from other sites permitted under this Circular, as well as any IT equipment deployed for such alternative work arrangement shall be returned to the PEZA-registered site of the ecozone IT enterprise in accordance with guidelines to be issued by PEZA.
      7. The ecozone IT enterprise renders PEZA free and harmless from any liability or accountability for any issues that may arise in case of noncompliance by the concerned ecozone IT enterprise with the requirements under the Circular.

      Actions to consider

      Ecozone IT enterprises that implement alternative work-from-home / remote work arrangements during the ECQ period must ensure to file the necessary notices and permits with PEZA, as required by and within the timelines provided in the Circular.

      While PEZA has issued the Circular to assist ecozone IT enterprises to manage their operations during the ECQ period, noncompliance with the requirements of the Circular may result in the imposition of applicable penalties in accordance with PEZA’s rules and regulations.

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      Maria Christina Macasaet-Acaban is a partner, and the head of the Corporate & Commercial Practice Group, the Healthcare Industry Group, and the Competition Focus Group, in Quisumbing Torres, a member firm of Baker & McKenzie International. She is a member of Baker & McKenzie International's Asia Pacific Healthcare Steering Committee, and the Asia Pacific Competition Steering Committee. She has 19 years of experience advising and representing multinational corporations on domestic and cross-border transactions.

      Joemyl Baloro is an associate in Quisumbing Torres' Corporate & Commercial Practice Group. Prior to joining the Firm, he was an Attorney in the Merger Review Division of the Philippine Competition Commission for almost two years. He was also a Legal Counsel for Corporate & Compliance of a multinational beverage company.