For millions of Filipinos seeking better opportunities overseas, signing an employment contract is a crucial step toward a brighter future. However, a serious threat called contract substitution continues to endanger the rights and welfare of Overseas Filipino Workers.
This article explains what contract substitution is, how it happens, why it is illegal, and how Filipino workers can protect themselves from this exploitative practice.
What is contract substitution?
Contract substitution is a form of contract fraud where an OFW is forced to sign a new employment contract—usually with less favorable terms—after already agreeing to a POEA-approved contract in the Philippines. This typically occurs:
- Upon arrival in the host country, before starting work
- After the worker has already begun employment
- Sometimes even before deployment, but after initial documentation
The substituted contract often reduces salary, removes benefits, increases working hours, or otherwise worsens the conditions compared to the original agreement.
How Does Contract Substitution Happen?
Contract substitution usually follows this pattern:
1. Signing in the Philippines
The worker signs a contract with the foreign employer (or their recruitment agency) in the Philippines. This contract is verified and approved by the Philippine Overseas Employment Administration (POEA), ensuring that it meets minimum labor standards.
2. Arrival abroad
Upon arrival in the host country, the worker is presented with a new contract—sometimes under pressure or threat of job loss—that contains terms less favorable than those in the original, POEA-approved contract.
3. Coercion
The worker is often told that signing the new contract is necessary to start or keep the job. Fear of losing the opportunity, financial debts from recruitment fees, and the pressure to support family back home make it difficult for OFWs to refuse.
Why is contract substitution illegal?
The Philippine government strictly prohibits contract substitution. Under Republic Act No. 8042, as amended by RA 10022 (Migrant Workers and Overseas Filipinos Act), and POEA regulations, it is illegal to substitute or alter, to the worker’s prejudice, employment contracts already approved and verified by the Department of Labor and Employment (DOLE) or POEA, from signing up to the contract’s expiration, without DOLE approval.
- Any side agreement or new contract that reduces salary or benefits below POEA-approved standards is void and unenforceable.
- Recruitment agencies and employers who engage in contract substitution can face blacklisting, fines, and criminal charges.
- The law applies to all OFWs, whether land-based or sea-based (seafarers).
Why Does Contract Substitution Persist?
Despite strict laws, contract substitution remains a problem due to several factors:
- Vulnerability of workers: Many OFWs are in debt from recruitment fees, desperate to keep their jobs, and far from home support systems.
- Weak enforcement in host countries: Not all countries have strong labor protections for migrant workers. Some lack bilateral agreements with the Philippines, making enforcement difficult.
- Power imbalance: Employers and agencies may threaten deportation or blacklisting, making workers feel powerless to resist.
- Lack of awareness: Some workers are not fully aware of their rights or the terms of their original contract.
Real-world examples
- A domestic worker signs a contract in Manila for a $400 monthly salary, but upon arrival in the Middle East, is forced to accept $250 and longer hours.
- A nurse is promised free accommodation and transportation, but the new contract abroad removes these benefits, increasing living costs.
- A seafarer’s contract is altered after boarding, reducing overtime pay and increasing workload.
These are not isolated incidents—they reflect a pattern seen across various industries and countries employing Filipino workers.
What should Filipino workers do?
Before Leaving the Philippines
Understand your contract
Read and understand every clause of your POEA-approved contract. Ask questions if anything is unclear.
Keep copies of signed contracy
Secure multiple copies of your signed contract and supporting documents. This can be helpful in case disputes arise related to benefits and worker’s rights.
Attend Pre-Departure Orientation
The Pre-Departure Orientation Seminar (PDOS) provides vital information on your rights and what to do in case of contract issues.
Upon arrival abroad
Do not sign a new employment contract
If presented with a new contract with less favorable terms, do not sign it. Insist on the original, POEA-approved contract.
Seek help immediately if coerced to sign a new contract
Contact the nearest Philippine Embassy, Consulate, or Philippine Overseas Labor Office (POLO) if you are pressured to sign a substituted contract.
Document everything
If you are coerced, keep records—messages, emails, or witnesses—that can support your case.
If you have already signed a substituted contract
Report the incident
Approach the Philippine Embassy or POLO for assistance. They can help you file a complaint and mediate with your employer.
File a case
You may file a complaint against the recruitment agency or employer with POEA or DOLE upon your return to the Philippines.
Know your rights: Remember, substituted contracts that reduce your benefits are void under Philippine law.
What are the penalties for contract substitution?
- For recruitment agencies: Suspension or cancellation of license, blacklisting, fines, and criminal charges under RA 8042 as amended.
- For employers: Blacklisting from hiring Filipino workers, administrative sanctions, and possible criminal liability.
- For workers: Workers who withdraw from deployment due to contract substitution are entitled to a refund of fees and may claim damages.
How can the government help?
The Philippine government, through the Department of Migrant Workers (DMW, formerly POEA) and the Department of Foreign Affairs (DFA), provides the following support:
- Legal assistance: Help in filing complaints and pursuing legal action.
- Welfare services: Shelter, repatriation, and counseling for distressed workers.
- Blacklisting and sanctions: Enforcement of penalties against violators to deter future abuses.
International Perspective
The International Labour Organization (ILO) and International Organization for Migration (IOM) consider contract substitution an indicator of forced labor and urge governments to combat this practice. Many countries have signed international agreements to protect migrant workers, but enforcement varies.
Key tips for Filipino workers
Never surrender your rights
Do not sign any document that reduces your salary, benefits, or working conditions.
Stay informed
Regularly check updates from DMW, DFA, and trusted OFW support groups.
Report abuses
Early reporting increases the chances of intervention and justice.
Share knowledge
Educate fellow workers about contract substitution and their rights.
Conclusion
Contract substitution is a serious violation of OFW rights and a persistent threat to the well-being of Filipino workers abroad. By understanding what it is, how it happens, and how to respond, you can protect yourself and help others.
Always remember: your POEA-approved contract is your shield—do not let anyone take it away or replace it with something less. If you face contract substitution, seek help immediately. The law is on your side.