Title
Philippine Dual Training System Law
Law
Republic Act No. 7686
Decision Date
Feb 25, 1994
The Dual Training System Act of 1994 aims to strengthen vocational and technical education in the Philippines by implementing a system that combines in-plant and in-school training, creating a pool of well-trained operators, craftsmen, and technicians for the economy.
dual training system
vocational education
technical education

Policy and objectives

  • The State policy under Section 2 is to strengthen manpower education and training to ensure an ever-growing supply of educated and skilled manpower with appropriate skills and desirable work habits and attitudes.
  • The Act adopts the Dual Training System in duly accredited vocational and technical schools in cooperation with accredited agricultural, industrial and business establishments as a preferred means of producing well-trained operators, craftsmen, and technicians for the economy (Section 2).
  • The Act’s objectives under Section 3 include:
    • encouraging increasing utilization of the dual system in technical and vocational education and training by both public and private schools within the existing education system;
    • encouraging increasing levels of investment in technical and vocational education and training by both public and private sectors, especially in rural areas;
    • enhancing employability and productivity by equipping graduates with analytical and creative thinking, problem-solving abilities, manipulative competencies meeting occupational standards, and values and attitudes emphasizing work ethics, quality orientation, discipline, honesty, self-reliance, and patriotism; and
    • strengthening cooperation between agricultural, industrial and business establishments and educational institutions by designing and implementing relevant training programs in close coordination with concerned local government units (Section 3).

Core definitions and scope

  • The Act applies to:
    • all public and private educational institutions/training centers; and
    • agricultural, industrial and business establishments that are duly accredited to participate in the dual training system (Section 6).
  • The Act defines “Appropriate Authority” as the government entity in charge of formal technical and vocational education training (Section 4).
  • The Act defines “Dual Training System” as an instructional delivery system combining in-plant training and in-school training based on a training plan collaboratively designed and implemented by:
    • an accredited dual system educational institution/training center; and
    • accredited dual system agricultural, industrial and business establishments,
      with prior notice and advice to the concerned local government unit (Section 4).
  • Under Section 4, the two instructing parties do not operate independently; they coordinate their efforts, with establishments primarily through practical training and the educational institution through adequate theoretical instruction (specific, general, and occupation-related).
  • The Act defines “Trainee”, “Accredited Dual Training System Educational Institution/Training Center”, “Establishments”, and “Accredited Dual Training System Agricultural, Industrial and Business Establishments” as stated in Section 4 (Section 4).

Institutionalization, planning, and coordination

  • The dual training system is institutionalized in the Philippines in accordance with the Act (Section 5).
  • The appropriate authority must plan, set standards, coordinate, monitor, and allocate resources in support of implementation of the system (Section 7).
  • Every accredited educational institution/training center must establish an industrial coordinating office to supervise in-plant training (Section 7).
  • The industrial establishment must furnish the educational institution with necessary information for supervision (Section 7).
  • The industrial coordinating office must be headed by an industrial coordinator at least of officer level rank and may be assisted by other personnel as necessary for effective discharge of functions (Section 7).

Status of trainee; employment priority

  • For the duration of training, a trainee is considered not an employee of the business/industrial establishment but a trainee of both the accredited educational institution/training center and the accredited establishment(s) (Section 8).
  • Workers/union of the establishment must have been duly informed in advance of the agreement establishing the trainee’s dual status (Section 8).
  • A trainee who successfully completes a training program in a particular establishment is entitled to priority of employment in that establishment (Section 8).
  • The appropriate authority must keep a roll of successful trainees for purposes of identifying them for employment (Section 8).

Rights and duties of parties

  • Participating agricultural, industrial and business establishments must:
    • ensure necessary abilities and knowledge are imparted and provide training systematically under an approved training plan;
    • appoint a training officer to implement the plan;
    • make available free of charge consumable materials and basic hand tools and equipment necessary for training;
    • allow the trainee to attend in-school training and to sit for examinations;
    • require the trainee to keep report book(s) up-to-date and inspect such books;
    • ensure the trainee is encouraged to develop personality and is protected from physical or moral danger;
    • entrust the trainee with jobs related to the purpose of training and commensurate with capabilities;
    • pay the accredited educational institution/training center the trainee’s daily allowance; and
    • allow the trainee necessary time-off for in-school training (Section 10).
  • Trainees must exert every effort to acquire the abilities and knowledge needed to achieve the training purpose and must:
    • carefully perform entrusted training jobs;
    • participate in training programs for which time-off is granted;
    • follow training instructions given by the training officer or other authorized persons;
    • observe rules of behavior in training premises;
    • use tools, instruments, machines, and other equipment with due care;
    • not reveal business or trade secrets learned during training; and
    • keep record books up-to-date (Section 11).
  • Accredited educational institutions/training centers that entered into memoranda of agreement must:
    • jointly design, implement, and evaluate the training plan with accredited establishments;
    • provide theoretical instruction specific, general, and occupation-related;
    • appoint industrial coordinators to supervise in-plant training;
    • pay the trainee the trainee’s daily allowance; and
    • perform other tasks and activities necessary to further the training objectives (Section 12).

Memorandum of agreement and trainees’ allowance

  • Before an individual establishment begins dual training with a trainee (or the trainee’s representative), the establishment must provide the educational institution/training center and the trainee with a copy of the signed agreement (Section 14).
  • The memorandum of agreement must set forth, among others:
    • the training plan;
    • the nature and objective of the training;
    • the commencement and duration of training, including total in-school and in-plant training hours;
    • the normal daily training hours;
    • the trainee’s allowance and the applicable rate, which in no case shall start below seventy-five percent (75%) of the applicable minimum daily wage for days spent in the establishments (Section 14);
    • the rights and obligations of the parties in addition to those in Sections 10, 11, and 12;
    • the trainee’s status under Section 8;
    • the conditions for termination of the training agreement;
    • the performance, monitoring, and evaluation system; and
    • other essential particulars mutually beneficial to all parties (Section 14).

Insurance; revolving fund; non-diminution

  • Every agricultural, industrial and business establishment undertaking training must sign a life and/or accident insurance policy covering the life of the trainee, naming as beneficiaries the insured and the trainee’s spouse, children or parents (Section 15).
  • Establishments must pay the premiums for the insurance policy (Section 15).
  • The accredited educational institution/training center may retain as a revolving fund the amount paid by the accredited establishments representing actual dual training expenses; the fund must be used to improve system operation (Section 16).
  • Nothing in the Act reduces or diminishes any privilege already enjoyed by parties under existing laws, decrees, or executive orders (Section 13).

Incentives, tax deductions, and tax-free imports

  • Participating agricultural, industrial and business establishments may deduct from taxable income fifty percent (50%) of the system expenses paid to the accredited educational institution/training center for the establishments’ trainees (Section 9).
  • The deduction under Section 9 is subject to:
    • the expenses not exceeding five percent (5%) of the establishments’ total direct labor expenses; and
    • the deduction in no case exceeding Twenty-five million pesos (P25,000,000) a year (Section 9).
  • Donations for operation of the system are deductible from taxable income of donors (Section 9).
  • The Department of Finance must issue necessary rules and regulations for the tax incentives in Section 9 (Section 9).
  • Donations, contributions, bequests, subsidies, or financial aid for system operation are allowable deductions from donors’ income for income tax purposes and are exempt from donor’s tax, subject to conditions under the National Internal Revenue Code, as amended (Section 18).
  • Essential equipment, apparatus, and materials imported by accredited dual training private educational institutions are exempt from taxes and duties (Section 18), if:
    • the importation is certified by the appropriate authority;
    • the items are actually, directly, and exclusively used in connection with the dual training system and unauthorized use subjects the accredited dual training private educational institutions to payment of taxes and duties due thereon; and
    • the items are not available locally in sufficient quantity of comparable quality and at reasonable prices (Section 18).
  • Taxes and duties pertaining to importations of accredited government and dual training educational institutions are deemed automatically appropriated (Section 18).
  • The Department of Finance must formulate rules and regulations to implement Section 18 (Section 18).

Implementing rules and administrative accountability

  • The appropriate authority and the Department of Finance must issue necessary rules and regulations for effective implementation within ninety (90) days after the Act’s effectivity, upon prior consultation with business and industry concerned (Section 17).
  • Violation of Section 17 subjects the concerned official/s to liability under Republic Act No. 6713, the “Code of Conduct and Ethical Standards for Public Officials and Employees,” and other existing administrative and/or criminal laws (Section 17).

Funding and appropriations; separability; repeal

  • For initial implementation, One million pesos (P1,000,000) is charged against the current year’s appropriation of the contingency fund (Section 19).
  • Thereafter, amounts needed for continued implementation must be included in the annual General Appropriations Act (Section 19).
  • If any provision of the Act is declared invalid or unconstitutional, the remaining provisions are not affected (Section 20).
  • All laws, decrees, orders, rules and regulations, or parts inconsistent with the Act are repealed or modified accordingly (Section 21).

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