While the WPP pay-out is the largest to date, it's unlikely to be the last in the current climate where few appear to be jumping ship to new jobs. What is prompting turnover rates to shoot up is the streamlining and cost-cutting underway as ad agencies grapple with a market slowdown, brought on partly by the global downturn and political uncertainties surrounding the unprecedented corruption trial of a former president.
Against this backdrop, agency observers believe more redundancies are on the cards since the year is projected to produce flat growth or, at best, a negligible increase in billings, continuing last year's dismal pattern. Based on published rate card figures, total adspend last year increased by 13.3 per cent to 69.8 billion pesos. But since monitored spend does not take discounts into account, it's widely believed that growth was flat, especially if inflation is factored in.
As such the "resignations
are raising eyebrows, especially since a number have ended up in court. Some of the separations have been amicable, but an increasing number - as reported in the local press - have resulted in court action.
For ad agencies, it's something of a rude awakening. Labour laws in the Philippines are tight, and favour the employee rather than the employer.
"Agencies are going to have to be very careful about the way they serve their walking papers,
said one former agency employee, who won compensation following an unfair dismissal case.
Last year, Hemisphere Leo Burnett gave cash compensations to three creatives, headed by Dino Mojica. The three alleged that Burnett failed to give them due notice. They had been with Burnett for between four and 10 years.
"If they had told me my performance was poor, I would have quietly gone,
one of the three said. "But they made me stay on for three months without giving me work. After we sent them our demand letter, the second wave of terminations stopped."
But Burnett Manila chief executive officer, Michael Constantine, said: "If a person is performing woefully, they are given opportunities to improve.
If it doesn't work out then we try to strike an amicable arrangement based on resignation and settlement."
Another case that is being talked about, but hasn't ended up before the courts, involves FCB Worldwide's Dennis Garcia, who was responsible for a number of popular San Miguel beer commercials.
He resigned his post as executive creative director earlier this year, just before FCB made a pitch for the brewer's account. Two other creative staff quit with Garcia, but one has since decided to stay put.
Garcia declined to comment, but Greg Garcia, Dennis' brother and former managing director and chief creative officer of Hemisphere Leo Burnett, spoke of a general "lack of respect
for creatives from management.
"It's hard for creatives to work if there is no healthy respect for them. Dennis was the only constant at FCB. For the other two to join him in resigning without a job - that's a statement in itself,
he said.
Other people movements in the agencies are seen to be part of the so-called annual rigodon, an allusion to a Filipino-Spanish dance in which participants regularly change partners.
The agency rigodon usually follows payment of the annual 13th month bonus.
But, by and large, it appears that staff turnover these days has less to do with the rigodon and is more the result of current economic realities - that could make for a very bumpy ride in agency-staff relations.
