Question & AnswerQ&A (DOLE DEPARTMENT ORDER NO. 3, S. 2001)
Department Order No. 10, Series of 1997 is hereby revoked effective immediately upon the issuance of Department Order No. 3, Series of 2001.
Labor-only contracting is prohibited under Department Order No. 3, Series of 2001.
Labor-only contracting occurs where the contractor or subcontractor merely recruits, supplies, or places workers to perform a job, work, or service for a principal and the contractor does not have substantial capital or investment to perform the job on its own account and the workers perform activities directly related to the principal's main business.
The two elements are: (a) The contractor or subcontractor does not have substantial capital or investment to perform the job under its own account and responsibility; and (b) The employees supplied perform activities directly related to the principal's main business.
No, the order explicitly states that it does not impair the rights or diminish the benefits of parties to existing contracting or subcontracting arrangements subject to relevant labor and civil law provisions.
Articles 5 and 106 of the Labor Code, as amended, are cited as the basis for the order.
It became effective fifteen days after publication in two newspapers of general circulation.
Prior consultations must be conducted with all concerned sectors, particularly the Tripartite Industrial Peace Council (TIPC).
The TIPC is the body that will be consulted prior to formulating new guidelines implementing Articles 106 to 109 of the Labor Code.
The order was signed by Patricia A. Sto.Tomas, Secretary of Labor and Employment.