Primer on the PROPOSED INDUSTRIAL ENGINEERING LAW OF 2006 and Other Initiatives

Transcription

1 Primer on the PROPOSED INDUSTRIAL ENGINEERING LAW OF 2006 and Other Initiatives 1. What is the proposed Industrial Engineering Law of 2006? The proposed IE Law of 2006 is a bill submitted to the Honorable Members of the Philippine Senate and House of Representatives intended to regulate the practice of Industrial Engineering in the Philippines. Once approved, any person or persons who wished to practice IE shall be required to secure a Certificate of Registration from the Board of Industrial Engineering, after passing a written IE Licensure examination or other requirements as provided for by law, before he or they can actually practice IE in the Philippines. 2. What is the motivation for pushing for the Industrial Engineering Law? This initiative is motivated by an urgent call upon all Industrial Engineers (IE) and student IEs to realize and understand their; a. Social responsibility by protecting the employees welfare and the employers interests, and b. Vital role in nation building and sustainable development through the adoption, development and implementation of effective programs in productivity improvement, industrialization and full and efficient use of resources. The above causes are more important than enhancing the IEs professional image in the eyes of the public or adding credibility and respect among the society or being at par with other licensed engineers or professionals. 3. In what manner can an IE demonstrate his social responsibility? As a trained professional in Time and motion studies and other Work measurement techniques, an IE recognizes his social relevance by ensuring that the production output or quotas or output levels are properly established and implemented. This has greater importance for employees whose wages are paid by results, pakyaw basis, piece-rates or other nontime work or those who may be subjected to incentive programs. In addition, an IE can help protect the employees welfare by determining appropriate working hours and rest periods (allowances) particularly for those workers who are subjected to extreme working conditions. Primer on the Proposed Industrial Engineering Law of 2006 and Other Initiatives Page 1 of 6 4. Give concrete examples on the conditions stated above. A number of industries have adopted payment of wages by results, per piece or pakyaw basis. This is evident when a company pays its employees a fixed amount for every case produced or every unit completed. In an actual study, this arrangement or set-up is adopted; Without any supporting Time and Motion or other workload studies being conducted; Inaccurate or miscalculated standards set; Wrong application of Payment by results or piece-rates to the prejudice of the minimum wage earners; and In a number of cases, workload studies are conducted by non-industrial Engineers 5. What are the direct consequences of inaccurate standards or misapplication of Payment by results? The following are the direct results: a. If the quota/standard set is too HIGH, the worker may not even earn the minimum wage. If the quota/standard set is too LOW, the earnings will be disproportionately high. Consequently, resulting to higher labor costs for the employers. b. A wrong application of payment by results or piece-rate may limit or deprive the workers opportunity to earn at least the minimum wage. Example, a number of piece-rate workers were advised to go home because there are no or insufficient amount of raw or packaging materials; or at any time after they started working, the equipment stops due to machine trouble. In these instances, the piece-rate worker goes home with a lesser income, the worse, empty-handed. 6. Give another example where an Industrial Engineer can be of help. In an actual study, a group of regular employees work inside a cold storage (with temperatures below freezing point). As practiced, they are required to work inside the storage for one (1) hour, then, allowed to rest for another hour to thaw (defrost). Surprisingly, a group of contractual employees are subjected to the same working conditions but are allowed only to rest for thirty (30) minutes. Why such a discrimination? In such case, no studies have ever been conducted to determine if the exposure time is appropriate nor the rest period optimal.

2 7. How can an IE be of help? With the help of the government, an IE can be of service to these lowly workers and at the same time protect the employers interest by requiring or influencing the concerned stakeholders to conduct appropriate studies (workload, time and motion studies, ergonomics, etc.) only by registered IEs in all; a. Piece-rate, payment by results or pakyaw arrangements b. Functions or tasks where a worker is subjected to strenuous or extreme working conditions. 8. What is the vital role of IEs in nation building and sustainable development? Known as productivity and efficiency experts, an IE, with the support of every key personnel in the organization, can effectively drive and implement effective cost-saving programs, productivity incentive schemes and other initiatives intended to fully utilize existing resources. 9. In what manner can an IE significantly contribute to the country s productivity programs? With the help of the government and the private sector, the industry can benefit from the IE potential by making better use of his skills, knowledge and proficiency. This can be validly seen by encouraging industry players to tap IEs in (to name a few): Setting-up, maintaining or continuously improving manufacturing standards and service levels Identifying or developing alternative raw and packaging materials, without sacrificing quality, to better improve cost of goods See Section Sec 4 of proposed bill for details 10. Is there a need to pass a bill to enjoy the IE promise? Yes, because without the effect and force of a law, there will be no compelling reason or driving force for the employers, businessmen, academe or even the government to take advantage of the IE skill, knowledge and proficiency for the benefit and protection of all parties concerned. Consequently (if approved), No Workload studies, payment by results or Strenuous/Extreme tasks will ever be approved or accepted in any government offices or agencies unless the same is supported by appropriate studies, conducted and reports signed by Registered Industrial Engineers. Primer on the Proposed Industrial Engineering Law of 2006 and Other Initiatives Page 2 of Is there a law or laws taking advantage of the IE skills but not necessarily recognizing the IE professional? Yes, the following laws, rules or regulations recognizes the benefits of Time and Motion studies in protecting the employees welfare and in increasing productivity. However, in all instances, the Industrial Engineer is not recognized as the person or group of persons professionally trained to conduct time and motion studies. To name a few; Art. 101, Philippine Labor Code The Secretary of Labor shall regulate the payment of wages by result xxx in order to ensure the payment of fair and reasonable wage rates, preferably through time and motion studies xxx. This is formerly adopted in the implementing rules of Presidential Decree (PD)1614 Sec 3 [g](1) Sec (8) Implementing Rules in Book III, Rule VII, Labor Code The Department of Labor shall use all available devices, including the use of Time and Motion studies and consultation with representatives of employers and workers organizations. RA 6971/Productivity Incentives Act of In order to sustain rising levels of wages and enhance competitiveness, businesses are encouraged to adopt productivity improvement schemes such as time and motion studies, good housekeeping, quality circles, labor management cooperation as well as implement gain-sharing programs. 12. Is there a rule or regulation issued by the government that contradicts an established IE principle? What is the legal implication? Yes, Sec (8) [b] of the Implementing rules in Book III, Rule VII of the Labor Code defines the basis of setting up the standard output and defines an Average worker. Basis: The performance of an ordinary worker of minimum skill or ability. Definition: An Ordinary worker of minimum skill or ability is the i. Average worker ii. Of the lowest producing group representing 50% of the total number of employees engaged in similar employment in particular establishment, excluding learners, apprentices and handicapped workers employed therein. If we follow strictly the above definition, the standard output established will be defective. It establishes a standard below the performance of an average

3 employee. Consequently, this will be costly for the employer since the standards set is lower than what should be. Legal Consequence: In case of conflict between any established practice and that required by a law, the law prevails. 13. What is then the effect of the passage and approval of the IE Bill? All rules and regulations issued pursuant to this law shall be binding on the employers, the academe, the industry and even to the government. (NOTE: The Following Questions presume that the Proposed Bill will be approved and adopted in toto or with slight modification) 14. If the bill is approved, who shall conduct the IE Licensure Examination? All examinations shall be conducted and supervised by the Board of Industrial Engineering, hereinafter referred to as the Board, under the Professional Regulation Commission (PRC) 15. Is taking the IE Licensure examination mandatory? No, just like any other engineering board exams, the IE licensure exam is not mandatory. An IE graduate may or may not take the IE Licensure exam. 16. What is included in the Practice of IE? Among others, the following will be considered as a practice of the IE profession; a. Conduct, preparation or implementation of Time and Motion studies or other workload measurements; b. Setting-up or implementation of Payment by results, piece-rates, or other nontime works; c. Other activities requiring IE knowledge, skill and proficiency; d. Etc See Sec. 4, Scope of Practice (Proposed IE Law) for more details. 17. What and who composes the Board? There shall be created a Board of Industrial Engineering under the supervision and control of the PRC composed of a Chairman and two (2) members to be appointed by the President of the Philippines. Any of them may serve for a maximum term of six (6) years. 18. What are the qualifications of the Board? Disqualifications? a. A natural-born citizen and resident of the Philippines; Primer on the Proposed Industrial Engineering Law of 2006 and Other Initiatives Page 3 of 6 b. Holder of at least a BSIE, or BS Industrial and Management Engineering (BSIME); c. Must be in the practice of IE for the last ten (10) years; d. Member of good standing of the Accredited Professional IE Organization; Disqualification: e. A person who does not have any pecuniary interest, directly or indirectly, in any university, college, school or institution conferring an academic degree necessary for admission to the practice of IE or where review classes in preparation for the licensure exam is being offered or conducted; f. Nor shall he be a member of the faculty or of the administration thereof; g. At the time of his appointment to the Board 19. When and Where shall the Licensure be conducted? a. Examination of candidates shall be given every 2 nd week of November each calendar year on the dates and venues prescribed by the Commission. For this purpose, the first examination shall be scheduled on the 2 nd week of November b. Whenever the number of applicant-examinees justifies the conduct of an exam, the examination may also be given on the 2 nd week of May every year, as may be determined by the Board and subject to the approval of the Commission. 20. What is the Scope of the IE Licensure? The IE Licensure covers only the IE fundamental subjects necessary to test the minimum standards required of the Industrial Engineer. New topics may also be added to encourage IE examinees and practitioners to look for areas wherein the IE profession can be of significant influence. Recognizing the varied application of IE principles, the Board shall issue general guidelines as to the topics or subjects to be included or excluded in a particular exam (As practiced in BAR examinations) at least five (5) months prior to the scheduled date of the exam. See Sec 15 of the Proposed Bill. 21. What is the passing rate of the IE Licensure Exam? To be considered pass, the examinee should obtain an average of at least 70%, with no grades lower than 50% in any subject. He shall then be called, Registered Industrial Engineer.

4 Conditional Pass If an examinee garnered an average of at least 70% of at least the majority of the subjects given, he shall receive a conditional credit for the subjects passed; provided, that he shall take the exam in the failing subjects within two (2) years from the preceding exam; provided further; That he should obtain an average of at least 75% and a rating of at least 65% in all subjects reexamined. Any candidate who failed in three (3) attempts shall be required to take a refresher course of at least 24 units of the subjects given in the IE exam before he can take another exam. 22. Who shall take the IE Licensure Exam? Any person, who wish to practice IE and has the following qualifications, may take the IE Licensure exam: a. Citizen of the Philippines; b. Of Good Moral Character; c. Holder of a BSIE or BSIME degree; d. He has not been convicted of an offense involving moral turpitude by a court of competent jurisdiction; e. Has obtained the BSIE or BSIME degree as of school year onwards. 23. Who may or may not take the IE Licensure Exam but still allowed to practice IE? Mode of acquiring License? The following person or persons may or may not take the IE licensure exam: a. Past and Incumbent officers of the Accredited Professional IE organization in recognition of their impeccable leadership and valuable contribution in uplifting the recognition and image of the IE profession, Provided, petition to the board must be made within the 1 st year after the adoption of this act. b. Members of the faculty of any university, school or institution conferring the BSIE or BSIME degree; Provided, That such faculty is taking a fulltime load for at least 6 consecutive semesters or 4 consecutive trimesters at the time of application. Petition shall be submitted to the board within the 1 st year after the effectivity of this act. Primer on the Proposed Industrial Engineering Law of 2006 and Other Initiatives Page 4 of 6 c. Those who obtained the BSIE or BSIME degree as of the school year or earlier; Provided that he shall earn a corresponding IE Technical Skills Upgrade programs equivalent to 15 units. Completion of such units must be made within 3 years from the adoption of this act. d. The following activities shall have the corresponding Units: i. Attendance in National or Regional Convention of IEs- 5 units ii. Attendance in Gen. Membership meetings, trainings or symposia recognized by the Accredited Professional IE organization 3 units iii. A Masters or Doctorate degree in IE; or being a resource speaker in any major IE gathering; or Election and Service of the Full term as an officer of the Accredited Professional IE Organization 10 units 24. What happens if the above persons do not observe the prescribed periods? They shall loose the benefits granted under this law and shall be required to take the IE Licensure exam if they wish to practice IE after such period. 25. Are IEs registered by virtue of this law recognized to practice IE outside the Philippines? Generally, professional regulation laws apply locally. Unless, the regulatory law of such foreign country recognizes licensed Filipino IEs, Filipino IEs cannot legally work as IEs in such country. In the same manner, foreign IEs cannot practice legally in the Philippines if their government does not recognize Filipino IEs. This is what we call Reciprocity laws. (This explains why, generally, Filipino doctors and lawyers, are not allowed to practice as such in the US or any other country were laws prohibit them from practicing as such) As of today, no Philippine law that prohibits any foreign IE from practicing here in the Philippines. If this bill will be approved, only Filipino IEs can practice IE here in the Philippines subject to the exemptions provided for in Sec 29 of the proposed bill. 26. Are duly executed contracts entered into by and between Philippine corporations and another foreign private corporations binding between the parties? How about other parties? Yes, the contract is binding only between them but does not bind other third parties.

5 Example, If Philippine Company A enters into a contract between a private Chinese Company B to the effect that both parties will recognize their respective employees as of equal competence and skills, such agreement binds them. However, such agreement does not bind the Chinese government or other Chinese companies. Same effect here in the Philippines. The problem arises if there is a Chinese law or when the Chinese government adopts a law prohibiting the hiring or recognition of foreign professionals other than their citizens. In such case, the contract becomes ineffective. Only official acts of one government, such as a law, binds another government, its people and other entities. International agreements are governed by International laws and not by private contracts. 27. Were there similar initiatives undertaken in the past? Did they prosper? Yes, there were a number of attempts to regulate the practice of IE, however, none of them proper. One of them is the Herrera Bill. The said bill have obvious defects. It proposed that the IE shall be supervised by the Department of Public works and Highways and shall report to Mechanical Engineering. It faced a strong opposition. 28. What is now the status of the proposed IE Law of 2006? On-going discussions, clarifications and technical research are undertaken by and in coordination with our Honorable Members of the Philippine Senate and the House of Representatives. Both representatives have now copies of the proposed bill for further evaluation. 29. What will happen to the proposed bill? The proposed bill, once, entered into the calendar of Congress will pass through three (3) readings; 1st Reading: The bill is enrolled and entered in the calendar. At this stage, the bill shall be assigned a House Bill Number or a Senate Bill Number. 2nd Reading: After the 1 st reading, it shall be referred to a committee for further evaluation. This is the most crucial stage. Public hearings will be conducted and oppositions and supporters will be heard. It will be criticized, amended, revised or adopted in toto (entirely) by Congress. 3rd Reading: At this stage, the bill will be voted upon by members of Congress. Related Initiatives in the Senate and in the House of Primer on the Proposed Industrial Engineering Law of 2006 and Other Initiatives Page 5 of 6 Representatives shall be reconciled. Once passed, it shall be forwarded to the President for approval. 30. What are the disadvantages of adopting IE Licensure? Being an official act of the government, it will take a longer time and process of scrutiny and assessment before it can be legally adopted. This is intended to ensure that the welfare and safety of the public, in general, is protected. 31. How can you be of help? If you embrace and believe the noble cause of this move (see Item 2-13), you can be of significant help by disseminating the truth behind the issues of IE Licensure, in any of the following; By helping us in the dissemination of the Truth behind the issues of the IE Licensure among your IE colleagues, clubs or friends; By Signing a Statement of Support (a pro-forma is herein attached) and sending the same to us for consolidation; By volunteering to gather the signatures within your area of influence and send the same to us for consolidation. 32. Is the proposed IE Law 2006 effective? Not yet! Until and unless, the Philippine Senate and House of Representative adopt and approve the bill, it still remains a proposal. 33. What is the rationale then of circulating this primer? This is intended to inform and educate all Industrial Engineers and student IEs of the real issues behind the different modes of IE regulation. This further seeks for better understanding, support and endorsement to expedite the legislative process. 34. Are there any other initiative offered to regulate the IE profession? Yes, the Philippine Institute of Industrial Engineers (PIIE) Manila, adopted and approved an IE Certification program way back in October Since that time, no specific guidelines have ever been released.

6 IE CERTIFICATION PROGRAM BY THE PIIE CERTIFICATION BOARD (Items 35 to 39 are Pertinent Information taken from the PIIE website as PIIE s official explanation of their proposed Certification program) 35. What is an IE Certification program? An IE Certification is a voluntary process, which validates an individual s qualifications in the field of IE professional practice. 36. What are its primary objectives? Why Get Certified? It encourage an IE practitioner to be certified for the following reasons: Mark of a Professional Enhanced status in the eyes of the public Adds credibility and respect 37. Give detailed explanation of the above objectives? Mark of a Professional Help promote a clearer public awareness and understanding of the role of IEs in society. And to aid in ensuring that fellow IEs perform their services in a manner, which recognizes as paramount public health and safety. Employers look to licensure or certification in evaluating the advancement potential of employees. Enhanced status in the eyes of the public Equates the IE with other professionals licensed in other fields. Assurance that the individual IE has passed at least a minimum screen of competence. Adds credibility and respect It polishes one s reputation as a qualified IE. 38. Who shall administer the IE Certification program? The IE Certification program shall be undertaken by the PIIE Certification Board, Inc., a private corporation organized primarily for the purpose of regulating the IE profession. 39. What are the modes of the IE Certification program? The program offers two (2) levels: Level 1: The Certified IE (CIE) Primer on the Proposed Industrial Engineering Law of 2006 and Other Initiatives Page 6 of 6 Designation for associate practice; Applies a general breadth of knowledge to analysis and evaluation. He should exhibit the minimum standards of competency for IE practice. The scope of practice is limited to the use of commonly accepted tools and techniques for the analysis and enhancement of performance in existing systems. Level 2: Professional IE (PIE) Designation for professional practice; The PIE applies and develops methodologies for analyzing, designing, testing and evaluating systems. The professional practitioner addresses complex problems and advanced IE technologies and methods in his area of specialization. Areas of specialization: Production and Manufacturing, Systems, Operations Research, Human Factors and Ergonomics, and Quality Engineering, among others. 40. What is the nature of the IE Certification program? Being a private initiative undertaken by a private corporation, Board of Trustees resolutions, policies and procedures are merely recommendatory. It does not bind Industrial Engineers who are not members of PIIE, as a professional organization; more so, it does not bind the government, other corporations or entities unless it enters into a contract with the latter. 41. Assuming that a person gets certified, what is his social responsibility then? None. Again, being a private initiative, employers, the academe, businessmen, other professional entities and the government cannot be compelled to recognize Certified or Professional IEs. However, the above stakeholders may voluntarily or by virtue of a contract give such recognition. 42. Would it be able to address the concerns raised in items 2-13? With the efforts of the PIIE Certification Board, they may be able to address the identified concerns. However, considering the recommendatory nature of their actions, it may be very difficult to seek compliance. 43. What is the advantage of IE Certification? Disadvantage? Being run by a private corporation, policies, procedures or guidelines may be adopted in lesser period of time and effort. Unfortunately, such policies, procedures or guidelines may be changed anytime at the whims of the Board of Trustees of such corporation.