FIRB temporarily extends work-from-home arrangement for IT-BPM enterprises

The Fiscal Incentives Review Board (FIRB) temporarily extended the work-from-home (WFH) arrangement for Information Technology and Business Processing Management (IT-BPM) enterprises until the interagency body makes a final decision next week.

“Considering the Sept. 12, 2022 expiration of the resolution, it is just fair that we extend the WFH arrangement for IT-BPM companies until we finalize a resolution addressing the issue,” Finance Secretary Benjamin E. Diokno, who is also the FIRB chairperson, said in a statement.

Mr. Diokno issued a memorandum which provisionally extended the current arrangement allowing IT-BPM enterprises in Philippine Economic Zone Authority’s (PEZA) economic zones to have 30% of their workforce conduct offsite work.

The PEZA’s request to extend the WFH arrangement is one of the agenda items at the FIRB’s next meeting on Sept. 15.

“Given the long-standing issue on the WFH extension for the IT-BPM sector, we hope the decision of the Board will finally bring clarity to the matter,” DoF Undersecretary and FIRB Technical Committee Chairperson Antonette C. Tionko was quoted as saying.

“We listen to our stakeholders and see the WFH arrangement to be the new business model of most of the registered business enterprises. Hence, the discussion on this matter in the next FIRB meeting requires a more permanent measure from the inter-agency body,” she added.

FIRB Resolution No. 017-22, which expires on Sept. 12, allows PEZA-registered IT-BPM firms to have WFH arrangements for 30% of their workforce, while still enjoying fiscal incentives guaranteed by the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act.

Last month, PEZA said the WFH extension for IT-BPM enterprises until March 2023 has been “approved in principle” but pending “further clarification” from the Department of Finance and the Board of Investments.

Earlier this month, Finance Assistant Secretary and FIRB Secretariat Head Juvy C. Danofrata said in a statement that the PEZA’s decision lacked legal basis as existing laws do not give investment promotion agencies the power to unilaterally approve WFH arrangements.

IT and Business Process Association of the Philippines (IBPAP) President and Chief Executive Officer Jack Madrid last week said the FIRB’s stand is “short-sighted and inconsistent with the objective of attracting and retaining investors in the country’s biggest job-generating industry and contributor of foreign exchange revenue.”

“The long-standing impasse with the FIRB and its very public exchanges with PEZA on the matter of WFH/hybrid work is not only detrimental to our narrative of industry agility, innovation and resilience, but also to our positioning of the Philippines as the IT-BPM investment destination of choice,” Mr. Madrid said.