Prohibition on Forcing Laborers to Buy Goods

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Act No. 3958: Prohibition on Forcing Laborers to Buy Goods

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Title Supreme Court: Prohibition on Forcing Laborers to Buy Goods

Law: Act No. 3958

Decision Date: Dec 2, 1932

Philippine Jurisprudence case highlights the prohibition on employers forcing employees to use tokens or objects as payment, nullification of contracts that attempt to circumvent this prohibition, the requirement for employers to pay salaries on specific dates, and the legal consequences for failing to comply with these provisions.

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Prohibition on Payment of Wages in Non-Legal Tender

Employers cannot pay or cause to be paid wages, either before or after payday or in part, using tokens, tickets, chits, or any objects other than the legal tender currency of the Philippine Islands.
Negotiations involving chits, tickets, or other objects representing prepaid wages not yet due are also prohibited.

Nullification of Contracts Defeating the Act's Purpose

Any contract wherein a laborer agrees to accept payment in tokens, tickets, or other non-cash objects, or any contract designed to defeat the purposes of this Act, shall be null and void.

Mandatory Payment Schedule for Employees

Employers are required to pay their employees’ salaries on the fifteenth or last day of every month, or on Saturday of every week, allowing only a two-day extension.
Failure to pay within these periods constitutes a violation of the Act, except if the employer proves that payment was impossible.

Effective Date

The Act became effective upon its approval on December 2, 1932.

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