On 5 March 2020, the Philippine Economic Zone Authority (PEZA) issued PEZA Memorandum CircularNo. 2020-011 (Circular) which authorizes PEZA-registered Ecozone IT Enterprises to take courses of action and implement alternative work arrangements in response to the coronavirus (COVID-19) situation in the Philippines.
Ecozone IT Enterprises may immediately implement their courses of action without need to obtain prior approval of the PEZA. However, they must comply with the conditions of the Circular, which includes the filing of a letter-attestation to PEZA within seven days from implementation of courses of action under the Circular.
What the Circular says
Generally, PEZA-registered enterprises may only operate within their respective PEZA-registered areas of operations, which must be located within a PEZA Economic Zone/ IT Park or IT Building. Prior PEZA approval must be secured before PEZA enterprise may implement alternative work arrangements including allowing its employees to work remotely from their home or from other locations.
Recognizing the need for Ecozone IT Enterprises to implement urgent preventive and pre-emptive measures to protect the health and welfare of employees and to ensure continued service delivery in the event of a large-scale emergency situation due to COVID-19, the Circular allows Ecozone IT Enterprises to immediately implement any of the following courses of action without need to secure prior PEZA Letter of Authority (LOA):
1. work from home by certain employees delivering critical services;
2. work from home by certain employees exhibiting symptoms akin to a person infected with COVID- 19 but physically able to work;
3. work from home by a group or groups of employees suspected of exposure to persons exhibiting symptoms of COVID-19 infection;
4. re-assignment/ re-distribution of employees to other PEZA-registered facilities of the Ecozone IT Enterprise in other PEZA IT Parks/ Centers;
5. assignment of certain employees to work in facilities/ buildings that are not PEZA-registered IT Parks/ Centers;
6. increase in the number of employees covered in the LOA for the Business Continuity Plan (BCP) previously issued by PEZA to the Ecozone IT Enterprise; and,
7. other justifiable and reasonable courses of action, including pre-emptive action, to respond to COVID-19.
Within seven days from implementation of a course of action pursuant to the Circular, the Ecozone IT Enterprise must submit a letter (Letter) addressed to the PEZA Director General signed by / emailed from any of the Ecozone IT Enterprise’s top three officials attesting to the following, among other requirements:
a) particulars of courses of action / implementation and the justification / objective of said course of action;
b) that the employees assigned to work outside the PEZA-registered offices of the Ecozone IT Enterprise have been properly informed of the said temporary re-assignment, and shall receive from the Ecozone IT Enterprise the same work load and the same salary and benefits, including overtime and night differential compensation.
c) that the Ecozone IT Enterprise shall be responsible and accountable for data privacy requirements, and shall adequately inform the re-assigned employees of applicable data privacy rules and regulations while working outside of their base offices;
d) that the Ecozone IT Enterprise, shall, for those employee assigned to work from home, observe applicable provisions, rules and regulations of the Telecommuting Act (Republic Act No. 11165); and
e) that the temporarily re-assigned employees, and equipment and other assets of the Ecozone IT Enterprise brought out of its PEZA-registered facility shall be brought back to their base office/ facility immediately after the COVID-19 situation has been declared by the Philippine authorities as resolved.
The Letter must be accompanied by
a) a list of equipment and other assets brought out of the PEZA-registered facility of the Ecozone IT Enterprise; and
b) a copy of the bond to cover 150% of the amount of duties and taxes (if imported) and VAT (if locally sourced) that would otherwise have been due on the equipment and other assets brought out of the PEZA-registered facility of the Ecozone IT Enterprise.
The PEZA shall issue a Letter of Authority (LOA) on the basis of the Letter, provided that pending the issuance of the LOA, the Ecozone IT Enterprise may proceed to implement its courses of action.
Validity of the Circular
The Circular and any LOA issued pursuant to its authority shall be valid until 31 July 2020, unless extended by the PEZA. An extension on the validity of the Circular shall correspondingly and automatically extend the validity of the LOAs issued pursuant thereto.
Actions to consider
ECOZONE IT Enterprises which are preparing contingency measures or course(s) of action to ensure business continuity in the midst of the COVID-19 situation in the Philippines must take note of the requirements under the Circular, to ensure that they implement such actions in compliance with PEZA regulations.