The prevalence and influence of Artificial Intelligence (AI) is nothing short of revolutionary. While it appears that AI does not yet have one official definition, it can colloquially be referred to as technology that allows machines or computers to utilise human-like intelligence to learn, create, analyse, and perform other functions or activities that were previously thought to be only exclusive to humans.
Undoubtedly, one aspect of life that has been or is increasingly being affected by AI is the workplace. On one hand, the use of AI may prove beneficial for employers as it may enhance productivity, efficiency, and maximise profits. On the other hand, its use could adversely affect members of the workforce who may be displaced as a result of the introduction of AI in the work process.
Currently, the Philippines has legal mechanisms in place that are intended to balance the seemingly competing interests of capital and labour.
Development and training programmes
In 2022, the Philippine Digital Workforce Competitiveness Act was enacted in response to the rapid transformation of the workplace due to advances in technology brought about by AI and automation. This Act provides for a framework that shall ensure that all Filipino workers have access to and are provided with digital skills and competencies that are at par with global standards and shall encourage innovations and entrepreneurship. This Act also established an Inter-Agency Council composed of various governmental agencies that shall be the primary planning, coordinating, and implementing body in the promotion, development, and enhancement of the competitiveness of the Philippine digital workforce.
Evaluating employee performance
In May 2024, an Advisory Opinion was rendered by the National Privacy Commission (NPC) which determined that employers in the Business Process Outsourcing (BPO) industry may use AI-powered tools to analyse call recordings and emails to automatically score BPO employees and rank them against other employees to identify opportunities for coaching and development, among others. However, considering that the use of AI for such purpose would involve the processing of employees’ personal information, the NPC provided guidelines to ensure that the processing thereof on the basis of legitimate interest would not run contrary to the Philippines’ Data Privacy Act.
First, the NPC confirmed that the use of automated scoring to evaluate employee performance can be considered as a legitimate interest since it directly contributes to the employer’s goal of improving its services. Second, the employer should ensure that the means to fulfil such legitimate interest must be adequate, relevant, suitable, necessary, and not excessive in relation to the declared and specified purpose. Finally, the employer should be aware that the employee whose personal information is being processed through the use of AI has the right to object to the same. Nonetheless, the employer may still proceed with the processing of personal information despite the objection if it can determine and prove the appropriate lawful basis or compelling reason to continue such processing.
Separation of employment
Considering that employees in the Philippines enjoy the right to security of tenure, employees cannot just simply be separated from employment by reason of the introduction of AI in the workplace. Such employees may only be separated due to authorised causes provided under Article 298 of the Labour Code. Particularly, these grounds include the installation of labour-saving devices, redundancy, or retrenchment to prevent losses.
For each of these grounds, the employer bears the heavy burden to convincingly prove that specific facts exist to justify the separation of employment. Moreover, it must be shown that both the affected employee and the appropriate office of the Department of Labour and Employment (DOLE) is notified in writing at least 30 days prior to the effectivity of the separation. Lastly, employers are likewise obliged to pay these employees separation pay.
Proposed legislation
Notwithstanding the availability of the foregoing legal mechanisms, it appears that the public is clamouring for more protection. In response to this, on 7 November 2023, a lawmaker proposed to legislate the Protection of Labour Against Artificial Intelligence Automation Act.
As currently worded, it appears that the proposed legislation will generally make it more burdensome for employers to augment its manpower complement as a result of the introduction of AI in the workplace.
For instance, while the proposed legislation recognises the employers’ prerogative to adopt AI as part of their workflows, employers will be required to formulate an AI Governance Policy to provide employees with guidelines for AI adoption and usage in the workplace. The proposed legislation also prohibits employers from using AI or automated systems as their sole or primary basis in the hiring and termination of employees. Moreover, contrary to what is already provided in Article 298 of the Labour Code, the proposed legislation prohibits the use of AI and automation technologies to replace human workers if it results in displacement, loss of security of tenure, or unemployment unless an equivalent alternative employment opportunity for affected human workers are made available. Relatedly, in case of retrenchment, the proposed legislation envisions that prior approval from the DOLE is required.
Unlike the above-mentioned NPC Advisory Opinion which applies specifically to employees in the BPO industry, the proposed legislation provides guidelines for all employers in conducting employee evaluations and performance assessments using AI.
Most importantly, the proposed legislation seeks to impose criminal liability upon any person who knowingly does, permits, or causes to be done any violation thereof. In particular, the responsible person may be punished with imprisonment of not less than six months to six years. Additionally, if the offender is a foreign national, he/she may be deported.
While the contents of the proposed legislation may, at first glance, appear alarming, it is still very much in its infancy. Nevertheless, given its potential impact on employment in the Philippines, it deserves to be closely monitored.