Law Summary
Public and Private Employment Offices (Arts. 15 and 16)
- Public employment offices under the Department of Labor handle recruitment and placement.
- Private recruitment is prohibited except for certain exempted entities such as schools, civic organizations, or employers for their own use under Secretary of Labor regulations.
Creation and Powers of Overseas Employment Development Board (Art. 17)
- Established to manage overseas employment (excluding seamen) promoting Filipino workers' welfare.
- Powers include skills development, employment terms compliance, registries, and establishing offices abroad.
Ban on Direct Hiring for Overseas Employment (Art. 18)
- Employers must hire Filipino overseas workers only through the Overseas Employment Development Board, with exemptions.
Registration of Emigrants (Art. 19)
- Individuals emigrating abroad must register with the Board before applying for a passport.
- The Board maintains a data bank and promotes emigrants' welfare.
National Seamen Board and Jurisdiction (Art. 20)
- Established to develop seamen programs, placement, employment terms, registries, and regulating hiring agents.
- Has original and exclusive jurisdiction over legal matters involving Filipino seamen for overseas employment.
Role of Foreign Service in Worker Protection (Art. 21)
- Philippine labor attaches and diplomatic officials assist Filipino workers abroad, ensure contract compliance, gather employment data, and protect rights.
Mandatory Foreign Exchange Remittance (Art. 22)
- Filipino workers abroad must remit part of their foreign earnings to beneficiaries in the Philippines under Secretary of Labor rules.
Composition and Secretariat of the Boards (Art. 23)
- Boards include government and sectoral representatives and are attached to the Department of Labor.
- Executive Directors appointed by the President aid the Boards.
Boards' Rule-Making and Fee Collection Powers (Art. 24)
- Boards authorize regulations and collect fees from employers, which fund their objectives.
Licensing and Regulation of Employment Agencies (Arts. 25, 27, 28, 30, 31)
- Private non-fee agencies require authority; fee-charging agencies require licenses.
- No new fee-charging agency licenses after Code effectivity; phase out within 4 years.
- Licenses only for Filipino citizens or entities majority-owned by Filipinos.
- Capitalization and bond requirements to ensure compliance.
Reporting, Regulatory and Visitorial Powers (Arts. 33, 36, 37)
- Secretary of Labor may require employment reports.
- Regulatory authority over recruitment and placement with power to inspect, require reports, and enforce compliance.
Jurisdiction and Penalties (Arts. 38, 39)
- Violations subject to concurrent jurisdiction of military tribunals or regular courts.
- Penalties include imprisonment, fines, revocation of licenses, forfeiture of bonds.
- Corporations held liable through officers; alien officers subject to deportation.
National Manpower and Youth Council (Arts. 45, 50, 52, 53, 54)
- Composition includes Cabinet members and private sector representatives.
- Establishes industry boards for manpower development.
- Provides incentives for labor training through tax deductions.
- Secretariat responsible for manpower planning, program implementation, and regional coordination.
- Regional offices assess local manpower needs and administer training.
Apprenticeship Provisions (Arts. 61, 62, 68, 70)
- Apprenticeship agreements must adhere to Secretary of Labor rules; wage rates start at not less than 75% of minimum wage.
- Signing and ratification procedures; minors require parental or authorized representative consent.
- Employers primarily responsible for aptitude testing; Department of Labor may assist.
- Apprenticeship is voluntary except under national security or economic development needs.
- Foreign technicians’ employer companies must set apprenticeship programs.
Employment Standards and Work Conditions (Arts. 82, 83, 86, 87, 91, 92, 93, 94, 95)
- Coverage excludes government employees, managerial staff, family members dependent on employer, domestic helpers, and piece-rate workers.
- Normal work hours capped at 8 hours/day; health personnel have specific schedules and compensation for 6-day work weeks.
- Night shift differential minimum 10%; overtime paid at 125% of regular wage; higher rates for holiday/rest day overtime.
- Weekly rest day of at least 24 consecutive hours required, scheduled by employer respecting religious preferences.
- Conditions for requiring work on rest days include emergencies, machinery maintenance, abnormal workloads, and continuous operations.
- Compensation rules for work on rest days, Sundays, and holidays defined with minimum premium pay.
- Workers entitled to regular holiday pay except small retail/service establishments; extra pay for holiday work.
- Service incentive leave of 5 days with pay after one year of service with exceptions.
Prohibition Against Elimination or Diminution of Benefits (Art. 99)
- Existing employee benefits at law promulgation not to be reduced or eliminated.
Attorney’s Fees and Retaliatory Measures (Arts. 110, 117)
- Attorney’s fees capped at 10% of recovered wages in unlawful withholding cases.
- Employers prohibited from retaliating against employees who file complaints, testify, or institute proceedings.
Wage Studies and Minimum Wage Adjustment (Art. 119)
- Continuous wage rate studies by Wage Commission.
- Recommendations for wage adjustments if minimum salaries insufficient for health and wellbeing.
Enforcement and Visitorial Powers (Art. 127)
- Secretary of Labor empowered to inspect, investigate, order compliance, issue execution writs, and suspend operations.
- Stoppage orders subject to prompt hearing; employers liable for wages during stoppage if faulted.
- Obstruction of orders is unlawful; temporary injunctions against enforcement orders are prohibited.
- Violating government employees subject to dismissal.
Classification and Employment of Women and Minors (Arts. 137, 138, 139)
- Women working substantially under employer control in nightlife and similar establishments considered employees.
- Minimum employment age set at 15; under 15 only with parental responsibility and no schooling interference.
- Persons 15-18 subject to regulated working hours; prohibited from hazardous work.
- Prohibition against age discrimination in employment terms.
Distribution of Service Charges
- Service charges in hotels, restaurants, and similar establishments distributed 85% to employees and 15% to management; employee share equally divided.
- If abolished, employee share integrated into wages.
Definitions Substantive Amendments (Art. 166)
- Precise definitions of dependents and salary credit computations for benefits provided.
Compulsory Coverage and Benefits (Arts. 167, 173, 176, 190, 191, 193)
- Compulsory coverage in State Insurance Fund for employers and employees under 60; optional for older employees.
- System’s subrogation rights in third-party legal liability cases.
- Powers to appoint staff, acquire property, enter contracts, and perform necessary acts.
- Detailed computation formulae for disability income benefits and death benefits with options for beneficiaries.
Jurisdiction of Labor Arbiters and Commission (Art. 216)
- Labor Arbiters have exclusive jurisdiction over unfair labor practices, collective bargaining deadlocks, money claims except some social benefits, and other labor relation cases.
- Commission acts as appellate body.
Execution and Contempt Powers (Arts. 223, 224)
- Secretary of Labor and Commission empowered to issue writs of execution, appoint sheriffs, impose fines for compliance enforcement.
- Secretary has contempt powers to enforce Code provisions.
Labor Case Procedures and Arbitration (Arts. 227, 230, 239, 241, 261, 262)
- Labor Arbiters only entertain cases indorsed by Bureau or Regional Director.
- Collective agreements must designate arbitrators; arbitration awards final and executory with limited appeal rights.
- Restrictions on fee deductions from employees without written authorization.
- Grievance procedures to be followed for disputes arising from collective agreements.
Tripartism and National Labor Policy (Arts. 265, 267)
- Tripartite labor relations policy promoting representation and voluntary codes of conduct.
- Prohibition of strike fund collections; requirement of authority for layoffs and establishing union membership criteria.
- No docket fees on labor standards disputes; other fees may be assessed with conditions.
Employment Security and Regularization (Arts. 268, 269, 270, 271)
- Law applies to all establishments.
- Security of tenure requires just cause or authorization for termination; unjust dismissal entitles reinstatement and back wages.
- Employment deemed regular when performing necessary business activities unless seasonal or project-based.
- Casual employment defined by exclusion; one-year continuous or broken service converts casual employee to regular.
- Probationary period limited to six months; termination allowed for failure to qualify as regular employee.
Transitional and Repealing Provisions (Arts. 283, 289)
- Claims and actions before Code effective date governed by prior laws.
- Pending cases transferred to corresponding new labor bodies.
- Pre-existing worker’s compensation cases processed under former laws.
Severability and Effectivity
- Invalid provisions do not affect remainder of law.
- Repeals inconsistent laws, rules, and orders.
- Immediate effectivity upon promulgation.