Question & AnswerQ&A (Act No. 3957)
The short title of the law is the "Private Employment Agency Law" as stated in Section 1 of Act No. 3957.
An employment agency or employment agent is any office or person who for monetary consideration directly or indirectly procures, looks for, or offers to procure employment or a contract for employment, or an employee, laborer or servant for another person. This includes associations, firms, or companies procuring employment for their members or others (Section 2).
No person shall establish, direct, or manage an employment agency without first securing a license issued by the Director of Labor and approved by the Secretary of the corresponding Department (Section 3). The application must include personal or corporate details, accompanied by payment of the prescribed tax and a bond, and comply with other procedural requirements (Sections 4 and 5).
The payment schedule varies: agencies in Manila pay 100 pesos per annum; in provinces, 50 pesos. If the agency also procures employees for foreign countries, the fee is higher: 1,500 pesos in provinces and 2,500 pesos in Manila, plus 25 pesos annually to the city or provincial treasurer and 1 peso per appointment (Section 7).
Each license takes effect on the first day of the month issued and expires on December 31 of the same year. Renewal applications must be made to continue the license (Section 9).
No, the law prohibits establishing employment agencies in hotels, boarding houses, or buildings where liquors or intoxicating beverages are sold (Section 10).
The contract must be in a language understood by the applicant, executed before a clerk of court or justice of the peace free of charge, who must explain the contract, verify debts or obligations, and certify compliance. Non-compliance may result in reprimand or removal (Section 11).
Agencies must keep two registers: one for applicants for employment, recording language, application date, fee received, employment details, references; another for applicants for employees, noting application date, type of employee requested, persons sent, employment outcome, and fees (Section 12).
Fees cannot exceed 20% of the applicant's wages during the first year, to be collected only after the applicant has secured the employment and after the first month's wages are received. Fees may be paid in monthly installments of 20% of monthly wages (Section 15).
Violations may result in fines from 25 to 200 pesos, imprisonment from one month to six months, or both. For sending a woman to a house of ill fame or exposing her to corruption, imprisonment ranges from six months to six years. The court may also cancel the violator's license and permanently disqualify them (Section 21).
The president, director, administrator, or manager of the corporation, firm, or company is criminally liable for violations committed by the entity (Section 22).
No, the law does not apply to those employers who recruit laborers for their own plantation, estate, or factory, provided they are not engaged independently as recruiters and they inform the Bureau of Labor of their designated agents (Section 19).