Labor Code of the Philippines

Agriculture and agrarian coverage expansion

Article 6 provides that agricultural workers enjoy the rights and benefits granted by the Code to nonagricultural workers, in addition to rights conferred by Republic Act No. 3844 (as amended), otherwise known as the Code of Agrarian Reforms of the Philippines.
Article 6 expressly integrates agricultural worker protections into the labor framework of the Code.

Tenant emancipation as labor policy

Article 7 states that emancipation of the tiller from bondage is an objective linked to addressing grievances that created violent conflict and social tension.
Article 8 deems tenant-farmers on private agricultural lands primarily devoted to rice and corn under share crop or lease tenancy (whether classified as landed estate or not) to be owner of a family-size farm:
- 5 hectares if not irrigated, or
- 3 hectares if irrigated.
Article 8 allows the landowner to retain an area of not more than 7 hectares if cultivating it or will now cultivate it.
Article 9 sets land value for transfer to the tenant-farmer at 2 1/2 times the average harvest of 3 normal crop years.
Article 9 requires payment of the total cost (including interest at 6% per annum) by the tenant in 15 equal amortizations.
Article 9 provides that in case of default, amortizations due are to be paid by the farmers’ cooperative with a right of recourse against the tenant-farmer.
Article 9 provides that the Government guaranties amortizations through shares of stock in government-owned and government-controlled corporations.
Article 10 bars issuance of title to tenant-farmers unless and until the tenant becomes a full-fledged member of a duly recognized farmers’ cooperative.
Article 10 restricts transferability of titles acquired pursuant to Presidential Decree No. 27 or the Government’s land reform program: title is not transferable except by hereditary succession or to the Government, in accordance with provisions of the Code, the Code of Agrarian Reforms, and other existing laws and regulations.
Article 11 requires the Department of Agrarian Reform to promulgate necessary rules and regulations to implement Chapter II.

Pre-employment policy and institutions

Article 12 establishes the State policy for pre-employment to promote and maintain full employment through improved manpower training, allocation and utilization.
Article 12 requires protection of citizens seeking work locally or overseas by securing the best possible terms and conditions of employment.
Article 12 directs regulation of movement of workers and the employment of nonresident aliens, and strengthening of public employment offices through phasing out private fee-charging employment agencies.
Article 12 mandates careful selection of Filipino workers for overseas employment to protect the Philippines’ good name abroad.
Article 16 creates an Overseas Employment Development Board to undertake a systematic program for overseas employment of Filipino workers (other than seamen) in excess of domestic needs and to protect rights to fair and equitable employment practices.
Article 20 creates a National Seamen Board to establish and maintain a comprehensive seamen training program, provide free placement services, secure best possible terms and conditions, secure full implementation of seamen employment contracts, and maintain a complete registry of seamen.

Definitions for recruitment, agencies, and workers

Article 13 defines “Private fee-charging employment agency” as any individual or entity engaged in recruitment and placement for a fee, whether charged to workers, employers, or both.
Article 13 defines “Private non-fee-charging employment agency” as recruitment and placement free of charge, whether from workers or employers or both.
Article 13 defines “Recruitment” as canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, including referrals, contact services, promising employment, and advertising for employment locally or abroad whether for profit or not; it deems recruitment when two or more persons are in any manner promised or offered employment for a fee by the one making the offer or promise.
Article 13 defines “Worker” or “Employee” to include any individual employed or any person hired to perform service of any kind for valuable consideration, including household or domestic helpers and crew members of vessels or seamen.
Article 13 defines “Immigrant worker” as a person working in a foreign country by virtue of an immigrant visa or resident permit distinct from a work permit or working visa.
Article 13 defines “License” as a document issued by the Department of Labor authorizing operation of a private fee-charging employment agency.
Article 13 defines “Authority” as the document issued by the Department of Labor authorizing operation of a private non-fee-charging employment agency.
Article 13 defines “Seamen” as all persons employed on any vessel engaged in maritime navigation.

Recruitment promotion, phase-out, and boards’ structure

Article 14 empowers the Secretary of Labor to organize and establish new employment offices, create a nationwide job clearance and information system, develop programs facilitating occupational/industrial/geographical mobility and relocation assistance, and require submission of employment information prescribed by the Secretary.
Article 15 requires the Department of Labor to phase out within four (4) years from Code effectivity all private fee-charging employment agencies, including those engaged in overseas recruitment and placement for personal services or vessel crew.
Article 15 provides that after phase-out completion, no person or entity shall directly or indirectly engage for profit or any pecuniary or material advantage in any recruitment or placement activity.
Article 15 allows continued operations of non-fee-charging employment agencies or placement services undertaken by schools, or civic or charitable organizations, or by employers for their own use under rules to be promulgated by the Secretary of Labor.
Article 16 attaches the Overseas Employment Development Board to the Department of Labor for policy and program coordination and efficient conduct of its duties.
Article 17 specifies the Board composition: the Secretary of Labor as Chairman and representatives from the Department of National Defense, Department of Foreign Affairs, Central Bank, and Department of Justice.
Article 17 provides that the Board is assisted by a Secretariat headed by an Executive Director appointed by the President upon recommendation of the Secretary of Labor; it states specified salary and allowance amounts for the Executive Director and a per diem of P100 per meeting for the Chairman and members.
Article 18 gives the Overseas Employment Development Board power to impose and collect fees from workers and employers concerned or both, with proceeds accruing to a special fund used exclusively for promotion of the Board’s objectives.
Articles 20–23 establish the National Seamen Board’s functions, composition, per diem (P100), Secretariat structure, and fee-collection authority analogous to the Overseas Employment Development Board, and require issuance of rules and regulations to carry out its functions.

Licensing and authorization to recruit

Article 24 prohibits any individual or entity from engaging in private fee-charging employment agency business without a license from the Department of Labor.
Article 24 prohibits any individual or entity from operating a private non-fee-charging employment agency without an authority from the Department of Labor.
Article 25 prohibits travel agencies from engaging in recruitment and placement of workers for overseas employment whether for profit or not.
Article 25 requires the Secretary of Labor to issue rules establishing requirements and procedures for issuance of licenses or authorities.
Article 25 preserves existing authorities or licenses to hire or recruit workers on Code effectivity: they remain valid for the duration indicated unless sooner cancelled, revoked, or suspended for cause by the Secretary of Labor, and may be renewed upon holder compliance with the Code and implementing rules.
Article 26 requires that no license or authority be issued or renewed except in favor of Filipino citizens or corporations/partnerships/entities at least 60% of whose authorized capital stock is owned and/or controlled by Filipino citizens.

Capital, fees, bond, and limits on fees

Article 27 requires applicants for licenses (and currently licensed recruiters) for overseas employment to have minimum capitalization or assets of PHP 150,000 for private individuals and PHP 150,000 paid-up capital for corporations, partnerships, or other entities.
Article 28 prohibits issuance of a license or authority in favor of any person other than the one in whose favor it was issued and prohibits operation outside the place stated in the license or authority.
Article 28 prohibits transfer, conveyance, or assignment of a license or authority; it allows changes like transfer of business address, appointment/designation of agent/representative, or establishment of additional offices only with prior approval of the Department of Labor.
Article 29 requires payment of an annual license fee:
- PHP 2,000 for recruitment for local employment, and
- PHP 6,000 for recruitment for overseas employment.
Article 30 requires posting of bonds by private fee-charging employment agencies:
- For overseas employment: cash bond of PHP 10,000 and surety bond of PHP 50,000.
- For local employment: cash bond of PHP 5,000 and surety bond of PHP 25,000.
Article 30 gives the Secretary of Labor exclusive power to determine, decide, order, or direct payment from/application of the cash and surety bond for claims or injuries covered and guaranteed by the bond.
Article 31 bars charging recruitment fees until the worker obtains employment through the agency’s efforts or has actually commenced employment.
Article 31 requires any such fee to be covered with an approved receipt clearly showing the amount paid, and it directs the Secretary of Labor to promulgate a schedule of allowable fees.

Foreign exchange remittance requirement

Article 32 requires mandatory remittance of a portion of foreign exchange earnings by all contract workers abroad to their families, dependents, and/or beneficiaries in the Philippines.
Article 32 directs that remittance is in accordance with rules and regulations by the Secretary of Labor after consultation with the committee on mandatory remittance of foreign exchange earnings established under Letter of Instruction No. 90 dated June 16, 1973.

Prohibited recruitment and related misconduct

Article 33 makes it unlawful for any individual, entity, licensee, or authority holder to charge or accept any amount beyond the Secretary of Labor’s schedule of allowable fees, or to make a worker pay any amount greater than the amount the worker actually receives as a loan or advance.
Article 33 prohibits furnishing or publishing false notices, information, or documents related to recruitment or employment.
Article 33 prohibits giving false notice, testimony, information, or documents or committing any act of misrepresentation to secure a license or authority.
Article 33 prohibits inducing or attempting to induce a worker already employed to quit in order to offer that worker to another, unless the transfer is designed to liberate the worker from oppressive terms and conditions of employment.
Article 33 prohibits influencing or attempting to influence any person or entity not to employ any worker who has not applied through the recruiter’s agency.
Article 33 prohibits recruitment or placement of workers in jobs harmful to public health or morality or to the dignity of the Republic of the Philippines.
Article 33 prohibits obstructing or attempting to obstruct inspection by the Secretary of Labor or duly authorized representatives.
Article 33 requires compliance with reporting duties; it makes it unlawful to fail to file reports on status of employment, placement vacancies, remittance of foreign exchange earnings, separation from jobs, departures, and other matters or information required by the Secretary of Labor.
Article 33 prohibits substituting or altering employment contracts approved and verified by the Department of Labor from actual signing up to and including the expiration period without Department of Labor approval.
Article 33 prohibits a recruiter from becoming officer or member of the board of any corporation engaged in travel agency or being engaged directly or indirectly in management of a travel agency.
Article 33 prohibits withholding or denying travel documents from applicant workers before departure for monetary or financial considerations other than those authorized under the Code and implementing rules.

Suspension, cancellation, and official protection abroad

Article 34 requires that the Secretary of Labor have authority to suspend or cancel licenses or authorities to recruit for overseas employment for violations of rules and regulations issued by the Secretary of Labor, Overseas Employment Development Board, and National Seamen Board, or violations of the Code and other Presidential decrees, the Revised Penal Code, the Anti-Dummy Law, general orders, and letters of instruction.
Article 35 directs that Philippine labor attaches/labor reporting officers, through the Department of Foreign Affairs or Philippine diplomatic or consular officials concerned, must provide counseling assistance to Filipino workers within their jurisdiction even without prior instructions.
Article 35 requires ensuring Filipino workers are not exploited or discriminated against, gathering and analyzing employment information and trends for dissemination to the Department of Labor and Department of Foreign Affairs, and performing continuous/special research and recommendations on employment market aspects within their jurisdiction.
Article 35 authorizes labor attaches to perform such other duties as required from time to time.

Labor regulatory powers and concurrent jurisdiction

Article 36 gives the Secretary of Labor power to restrict and regulate recruitment activities within the Code’s coverage and to issue orders and promulgate rules and regulations to carry out Code objectives and implementation.
Article 36 allows the Secretary of Labor, when public interest requires, to direct persons or entities covered to submit reports on status of employment, placement, vacancies, job requisition details, separation from jobs, wages, and other terms and conditions.
Article 36 authorizes inspections of premises, books of accounts, and records by the Secretary of Labor or duly authorized representatives, and it allows requiring regular submissions on prescribed forms and acting on violations.
Article 37 provides that violations of Title I and its implementing rules fall within the concurrent jurisdiction of the Military Tribunals and regular courts, with the court that first assumes jurisdiction excluding the other.
Article 37 provides that employer-employee relations matters, including money claims arising from Title I, fall under the original and exclusive jurisdiction of the National Labor Relations Commission.

Criminal penalties and automatic consequences

Article 38 provides imprisonment penalties and fines for violations under Title I:
- Licensees/authority holders found violating, or causing another to violate Title I or its implementing rules: imprisonment of not less than two (2) years nor more than five (5) years, or a fine of not less than PHP 2,000 nor more than PHP 30,000, or both, at the discretion of the court.
- Persons not licensees/authority holders found violating Title I provisions: imprisonment of not less than four (4) years nor more than eight (8) years, or a fine of not less than PHP 5,000 nor more than PHP 35,000, or both, at the discretion of the court.
Article 38 provides that conviction causes automatic forfeiture of the bond (cash and surety) in favor of the special fund for the Overseas Employment Development Board or the National Seamen Board, as the case may be.
Article 38 provides that conviction causes automatic revocation of the license or authority and all permits and privileges granted under Title I.
Article 38 provides that if the offender is a corporation, partnership, association, or entity, the penalty is imposed upon the guilty officer or officers.
Article 38 provides that if the guilty officer is an alien, he shall be deported without further proceedings, in addition to penalties prescribed.

Nonresident alien employment permits

Article 39 requires any alien seeking admission to the Philippines for employment purposes, and any employer seeking to engage the alien for employment in the Philippines, to obtain an employment permit from the Department of Labor.
Article 39 provides that the employment permit may be issued after determination of the non-availability in the Philippines of a competent, able, and willing person at the time of application to perform the desired services.
Article 39 provides that for an enterprise registered in preferred areas of investments, the employment permit may be issued upon recommendation of the government agency supervising that registered enterprise.
Article 40 provides that after issuance of an employment permit, the alien shall not transfer to another job or change employer without prior approval of the Secretary of Labor.
Article 41 requires employers employing nonresident foreign nationals on Code effectivity to submit within 30 days a list of their names, citizenship, foreign and local addresses, nature of employment, and status of stay to the Secretary of Labor.
Article 41 directs the Secretary of Labor to determine entitlement to an employment permit based on the submitted list.

Human resources development framework

Article 42 makes it the objective of the Human Resources Development Title to develop human resources, establish training institutions, and formulate plans and programs ensuring efficient allocation, development, and utilization of national manpower to promote employment and accelerate economic and social growth.
Article 43 defines “Manpower” as the portion of the nation’s population with actual or potential capability to contribute directly to the production of goods and services.
Article 43 defines “Entrepreneurship” as training for self-employment or assisting individual or small industries within the Title’s purview.
Article 44 attaches the National Manpower and Youth Council to the Department of Labor for policy and program coordination and sets the Council composition, including ex officio members and private sector members appointed by the President for terms of three (3) years.
Article 44 provides that Council members are entitled to per diems of P100 for each meeting and payment of travel expenses, for not more than 30 meetings within one (1) year, and provides the Executive Director has no vote.
Article 45 requires the Council to formulate a long-term national manpower plan, update it annually, submit it to the President for approval, and treat it as controlling for manpower development across the country in accordance with the national development plan.
Article 46 requires the Council to establish a National Manpower Skills Center and regional and local training centers under Council rules and regulations.
Article 47 requires establishment of national skills standards for industry trades by the Council in consultation with employers and workers organizations and appropriate government authorities.
Article 48 mandates Council administration through its Secretariat for instructor training, entrepreneurship development, and training in vocations, trades, and other employment fields; it also authorizes the Council to administer ongoing technical assistance programs and grants-in-aid for manpower and youth development.
Article 48 requires coordination of all manpower training schemes with the Council, including regulation to conform with national development programs, with existing government and private training programs to be reported to the Council.

Employment service and training incentives

Article 50 requires the Council to utilize the Department of Labor’s employment service for placement of Council graduates.
Article 50 requires the Bureau of Employment Services to assist in unemployment and underemployment measurement, local manpower resource surveys and occupational studies (including inventory of the labor force), maintain a national register of technicians free of charge, and maintain an up-to-date system of employment information.
Article 51 grants an incentive of an additional deduction from taxable income equal to one-half (1/2) of the value of labor training expenses incurred for developing or upgrading the productivity and efficiency of unskilled labor or for management development programs.
Article 51 requires that the training program be approved by the Council and limits the deduction to not exceeding 10% of direct labor wage.
Article 52 creates Council Secretariat governance, including an Executive Director appointed by the President on recommendation of the Council, with Secretariat offices and detailed qualification and term requirements for key officials.
Article 53 requires creation of regional manpower development centers to determine manpower needs in their jurisdictions, provide data to central planners, recommend programs, administer and supervise Secretariat training programs within the region, and perform other duties assigned by the Council.
Article 54 authorizes the Council to set aside a portion of its appropriation for consultants and/or private organizations for research and publication, and to avail of other government agencies as required.

Skills and apprenticeship programs for employment

Article 55 requires the Council to define broad functions and issue rules and regulations to implement this Title.
Article 56 sets apprenticeship program objectives: meet the economy’s demand for trained manpower; establish a national apprenticeship program with employer, worker, and government/non-government participation; and establish apprenticeship standards to protect apprentices.
Article 57 defines:
- “Apprenticeship” as practical on-the-job training supplemented by related theoretical instruction,
- “apprentice” as a worker covered by a written apprenticeship agreement,
- “apprenticeable occupation” as a trade/occupation requiring more than three (3) months practical training plus related theoretical instruction, and
- “apprenticeship agreement” as the contract where employer trains the apprentice and apprentice accepts training terms.
Article 58 requires apprenticeship qualification: at least 14 years of age; vocational aptitude/capacity shown through appropriate tests; and ability to comprehend and follow oral and written instructions.
Article 59 limits employers’ authority to employ apprentices only in apprenticeable trades and occupations approved by the Secretary of Labor.
Article 60 requires apprenticeship agreements (including wage rates) to conform with Secretary of Labor rules and regulations; it allows wage rates below legal minimum wage only under apprenticeship programs duly approved by the Department of Labor, with the Department to develop standard model programs.
Article 61 requires apprenticeship agreement signing by the employer/agent (or authorized representative of recognized organizations), and by the apprentice; it requires parental/guardian signature for minors, binding through stipulated termination, and requires ratification by appropriate apprenticeship committees (if any) and furnishing copies to both employer and apprentice.
Article 62 permits apprenticeship programs to use any of the following venues: entirely by and within sponsoring firm/entity; entirely within Department of Labor training center or other public training institution; or initial fundamentals in a training center with subsequent actual work participation in the sponsoring firm/entity in the final stage.
Article 63 permits sponsoring of apprenticeship programs by single employer/firm, by a group/association, or by a civic organization, with actual training undertaken in specified premises or a Department of Labor or public training institution.
Article 64 requires investigation of violations of apprenticeship agreements upon complaint of interested persons or on its own initiative by the appropriate Department of Labor agency or authorized representative.

Apprenticeship appeals, remedies, and incentives

Article 65 allows appeals to the Secretary of Labor from the decision of the authorized agency within five (5) days from receipt; the Secretary’s decision is final and executory.
Article 66 requires exhaustion of administrative remedies before instituting any action for enforcement of apprenticeship agreements or damages for breach.
Article 67 assigns primary responsibility for aptitude testing of applicants to employers/entities with duly approved apprenticeship programs; it requires the Department of Labor to perform aptitude testing free of charge when employers lack adequate facilities.
Article 68 allows theoretical instruction within the plant to be done by the employer, but if the employer cannot assume responsibility, it may be delegated to an appropriate government agency.
Article 69 establishes voluntary apprenticeship program organization by employers and authorizes compulsory apprenticeship training when national security or economic development requirements demand it, as determined by the Secretary of Labor, with rules promulgated as needed; it provides that the number of apprentices for factories and industrial enterprises depends on exigencies.
Article 70 grants an additional taxable income deduction equal to one-half (1/2) of the value of labor training expenses incurred for developing the productivity and efficiency of apprentices, provided the program is duly recognized by the Department of Labor.
Article 70 limits the deduction to not exceed 10% of direct labor wage, and it requires that the person/enterprise availment must pay apprentices the minimum wage.
Article 71 authorizes the Secretary of Labor to approve hiring of apprentices without compensation when required by the school or training program curriculum or as a prerequisite for graduation or board examination.

Learners and handicapped workers rules

Article 72 defines learners as persons hired as trainees in semiskilled and other non-apprenticeable industrial occupations learnable through on-the-job practical training in a period not exceeding three (3) months.
Article 73 allows hiring learners only when no experienced workers are available, employment of learners is necessary to prevent curtailment of employment opportunities, and employment does not create unfair competition in labor costs or impair or lower working standards.
Article 74 requires a learnership agreement with included terms: learner names/addresses; learnership duration not exceeding three (3) months; wage/salary starting at not less than 75% of the applicable minimum wage; and commitment to employ as regular employees upon completion if learners so desire.
Article 74 provides that learners who work during the first two (2) months are deemed regular employees if training is terminated by the employer before the end of the stipulated period through no fault of the learner.
Article 74 requires learnership agreements to be subject to inspection by the Secretary of Labor or authorized representatives.
Article 75 requires learners in piece or incentive rate jobs during training to be paid in full for work done.
Article 76 subjects violations of the Learners Chapter or its implementing rules to the general penalty clause of the Code.
Article 77 defines handicapped workers as those whose earning capacity is impaired by age or physical or mental deficiency or injury.
Article 78 allows employment of handicapped workers when necessary to prevent curtailment of employment opportunities and when it does not create unfair competition in labor costs or impair or lower working standards.
Article 79 requires an employment agreement for handicapped workers with included terms: names/addresses; wage rate not less than 75% of the applicable legal minimum wage; duration of employment; and work to be performed; it requires subjecting the agreement to inspection by the Secretary of Labor or authorized representatives.
Article 80 allows handicapped workers, subject to appropriate Code provisions, to be hired as apprentices or learners if their handicap does not effectively impede performance of job operations in the particular occupations hired.
Article 81 subjects violations of the Handicapped Workers Chapter or its implementing rules to the general penalty clause.

Working time, rest days, and overtime pay

Article 82 applies Working Conditions and Rest Periods provisions to employees in all establishments and undertakings (whether for profit or not), but it excludes government employees, managerial employees, field personnel, domestic servants, persons in personal service, workers paid by results when output rates are fixed by