MANILA - Amid calls from workers nationwide to put a stop to contractualization, Labor Secretary Silvestre Bello III on Labor Day admitted that a ban on the practice is not yet legally possible.

"What they want is total ban [on] contractualization, which is not legally possible right now. The rule is there should be no contractualization but the law allows exceptions," he told reporters in Davao City Monday.

Bello explained that the law allows contractual setups for seasonal workers and project-based employees like janitors and security guards.

He however said there is a proposed bill in Congress already that seeks a total ban on the practice.

The Labor department has begun implementing Department Order 174, which seeks to regulate labor-only-contractualization.

According to DOLE, DO 174 will end the practice of "endo" wherein employment contracts are deliberately terminated before the sixth month to avoid paying benefits that are due to regular workers.

Analysts have warned that small businesses will be forced to lay off workers or hold off on hiring new employees because of the department order.-- with a report from Angelo Caballero, ABS-CBN News