Aussie Company Loses Court Case Against Filipino Contractor

Hi,

If you are running a business in Australia, you need to spend two minutes digesting this article. If you are not running a business in Australia, it’s still worth paying attention anyway.

If you are a client of Frontline or any other reputable BPO in the Philippines, this case won’t apply to you. You have nothing to worry about.

However…

If you directly contract with staff in the Philippines, or are thinking about doing that in the future, I can only say the same thing I’ve been saying since 2011 – you are better off engaging a BPO in your offshore strategy.

Recently, a case between Joanna Pascua and Doessel Group Pty Ltd was heard by the Fair Work Commission (FWC) in Australia. The company lost both initially and on appeal.  

The case concerns Joanna Pascua, a Philippine citizen and resident, who was working for an Australian business as a paralegal for about two years before they dismissed her.

She launched a case in the Australian system to claim she was an Australian employee, not a contractor…even though about two years earlier she entered a contractual arrangement with the company. But Joanna decided to move the goal posts.

The irony of the situation is that she worked for an Aussie legal firm, and their own contracts were, in my opinion, sloppy. The contract used in the case wasn’t even signed.

This case has been covered by many BPOs and legal firms, so if you want to dig in a bit deeper, you don’t have to look far to read an article or blog post about it.

The ABC in Australia, wrote an article titled ‘This Filipino woman struck a blow against Australian businesses ‘exploiting’ offshore workers’.

Exploiting? Give me a break.

Joanna was paid AU$18 an hour, which put her equivalent local earnings at over PHP100k a month – several multiples of an average salary in the Philippines.

But according to the Aussie media, she was exploited. Most Philippine locals would find this proposition completely ridiculous. As the owner of the respondent company in this case rightly pointed out, she earned more than a pilot earns in the Philippines.

What about the short-sightedness of this choice to take the company to court? How many businesses will avoid the Philippines now? If all they see is this case and garbage reporting by the media, I wouldn’t blame them for avoiding an offshore employee.

Which is why I’m writing about this case – to get the message out there. Almost all people here are good, loyal people who will add value to your business.

I’ve spent over ten years promoting the Philippines as an ideal destination to hire talent. What Joanna did was an embarrassment. It wasn’t a victory. It was a disgrace.

If you engage with people in the Philippines directly as contractors, be careful. Your risk profile has now changed. I have always advocated for hiring people in the Philippines via a reputable BPO (such as Frontline!), but now it would be foolish to do otherwise.

By engaging a reputable BPO, all the employer-related obligations are taken care of. Employees are protected by a strong labor code in the Philippines, taxes and other payments are correctly remitted to the government, employees are given generous health insurance, and all other employee-related matters are taken care of.

Mark

PS – in case you missed the links above, it’s worth spending a few minutes reading the key parts of the initial case, along with the appeal. I have linked both below for your convenience.

• Initial case: Click here
• Appeal: Click here