Labor Code of the Philippines Overview

A set of laws protecting workers, promoting employment and human resource development, and ensuring industrial peace in the Philippines.

The Labor Code comes into effect six months after its official announcement.

The government protects workers, promotes jobs, and ensures fair working conditions, equality, and the right to organize.

The Code guarantees rights like self-organization, collective bargaining, job security, and fair working conditions.

When a law has possible interpretations, it should favor workers.

Agencies like the Department of Labor will create specific rules to make the Labor Code work.

This law generally applies to all employees, with a few specific exceptions.

The code aims to improve conditions for farm workers by changing land ownership.

Tenant farmers cultivating rice and corn on private land are considered owners of a portion of land, typically 5 hectares for non-irrigated or 3 hectares for irrigated land.

Landowners can retain a maximum of 7 hectares if actively cultivating or planning to cultivate the land.

Land value for transfer to tenant farmers is set at 2.5 times the average harvest of the 3 years before October 21, 1972.

Land purchase by tenant farmers to be paid in 15 equal annual installments with 6% interest.

Farmers' cooperatives will pay for defaulting tenant-farmers' land amortizations.

Government safeguards land payments with shares in government corporations.

Tenant-farmers must become full cooperative members before receiving land title.

Land acquired under Presidential Decree No. 27 can transfer through inheritance or to the government only.

The Department of Agrarian Reform will regulate implementation of land reform.

Promote full employment through better manpower training and allocation.

Protect workers' rights by ensuring favorable employment conditions.

Allow workers to choose jobs in accordance with national interests.

Manage and control worker movement within and outside the country.

Regulate hiring of foreign workers by setting registration/work permit systems.

Strengthen and rationalize public employment systems for better workforce planning.

Insure careful selections of Filipino workers overseas to uphold Philippines abroad.

Developed and implemented by the government to boost employment opportunities.

Registration and licensing system for private recruitment agencies to ensure fair labor practices for Filipino workers, overseas and locally.

Registration and work permit system to control the employment of foreigners.

A system providing data to inform manpower planning.

System to help match people with suitable jobs.

Central database of worker skills.

Government body to promote overseas employment for Filipinos and protect their rights.

Prohibition against employers hiring Filipinos for overseas jobs directly, except in specific exemptions.

A department to support and connect with overseas Filipino communities.

Government body for Filipino seafarers overseas.

Free placement services for Filipino seafarers.

Board's authority over disputes between seamen employers.

Regional offices handle employer-employee issues for Filipino overseas workers.

Public employment offices are the only ones who can recruit workers for employment, excluding some exemptions.

Minister of Labor can charge fees for services, deposited for specific purposes.

Labor Attachés protect Filipino workers overseas, assist with employment issues, fight exploitation and discrimination, and ensure contract terms comply with Philippine labor laws.

Labor Attachés, labor reporting officers, and Philippine diplomatic or consular officials verify that overseas employment contracts comply with Philippine labor laws.

Filipino workers abroad must remit a portion of their foreign exchange earnings to their families or dependents in the Philippines.

The OEDB promotes the welfare of overseas Filipino workers by regulating recruitment and placement activities.

The OEDB is composed of government officials, representatives of different departments, workers' and employers' organizations, and the Executive Director.

The NSB regulates seafarer recruitment and placement, promoting the welfare of Filipino seamen.

The NSB is composed of government officials, representatives, and the Executive Director, focusing on maritime employment.

Private companies can participate in the recruitment and placement of overseas Filipino workers, but under strict guidelines and regulations.

Travel agencies are forbidden from recruiting workers for overseas employment, whether for profit or not.

Only Filipino citizens or corporations with majority Filipino ownership are authorized to recruit and place workers overseas.

Recruitment agencies need to have sufficient capitalization as determined by the Secretary of Labor.

No, a recruitment license cannot be transferred or assigned to any other individual or entity.

The Secretary of Labor sets fees for registration and obtaining a recruitment license.

Recruitment agencies must post cash and surety bonds to ensure compliance with regulations and worker rights.

Fees for recruitment and placement services are paid by the workers seeking employment overseas.

When illegal recruitment significantly harms the Philippine economy, it can be considered economic sabotage.

A person with a recruitment license breaking the rules faces up to five years in prison, a fine of P50,000, or both.

Someone without a recruitment license who breaks the rules faces up to eight years in prison, a fine of P100,000, or both.

If a company breaks the rules, the responsible officer will face the penalties, and if they are a foreigner, they will be deported.

Getting convicted of a labor violation means losing your recruitment license, permits, and any cash or surety bonds you put up.

Foreigners working in the Philippines need an employment permit from the Department of Labor, proving no Filipino is qualified for the job.

A foreigner with an employment permit can't change jobs or employers without the Labor Secretary's approval.

Companies employing foreign workers must provide a list of them to the Department of Labor for permit evaluation.

The program aims to develop skills, establish training institutes, and plan how to use the nation's workforce for economic and social growth.

This council, with representatives from various government departments and private organizations, plans how to use the country's labor force effectively.

This long-term plan outlines how to best use the country's workforce for jobs, self-employment, and economic development.

The part of the population that can contribute to producing goods or services.

This refers to training individuals to start their own businesses or helping small companies.

The National Manpower Plan guides the development of human resources in the entire country, ensuring a good match between skills and jobs.

A government-established center dedicated to promoting skill development in the Philippines. It offers training programs and helps create national skills standards.

These boards are established to involve employers and workers directly in developing manpower development programs, setting standards for trades, and helping the Council achieve its goals.

The administrative and operational heart of the Council. It manages various offices and departments to implement the Council's policies and functions.

The National Manpower Skills Center is designed to promote the development of skills in the Philippines by establishing training programs and fostering national skills standards.

The Council sets national skills standards in consultation with employers' and workers' organizations, as well as relevant government agencies.

The Secretariat, headed by a Director-General, manages various offices like the National Manpower Skills Center, regional offices, and others to carry out the Council's objectives.

Industry Boards play a vital role in helping the Council develop manpower development programs, establish trade and skills standards, and involve employers and workers directly in achieving the Council's objectives.

The Council sets fees for the industry boards, and this funding scheme ensures their maintenance and operations.

The Council, through its Secretariat, provides grants and assistance programs for overseas Filipino workers.

The Director-General must be a natural-born Filipino citizen, hold a master's degree, and have significant experience in national planning and human resource development.

The Council utilizes the Department of Labor's employment service to help place graduates of its training programs into jobs.

Companies can deduct half the cost of approved labor training expenses from their taxable income, up to 10% of their direct labor wage.

The Director-General is appointed by the President of the Philippines on the recommendation of the Secretary of Labor.

The Council Secretariat coordinates and implements manpower development programs, manages various offices, and carries out the Council's policies and functions.

A private employment agency cannot charge any fee to a job seeker until they are placed in a job. This fee is capped by a schedule set by the Secretary of Labor and must be clearly documented with a receipt.

These practices are illegal: charging more than authorized fees, providing false recruitment information, inducing workers to quit their jobs without a valid reason, obstructing inspections, withholding travel documents for payment.

The Secretary of Labor can restrict and regulate the activities of all recruitment agencies, issuing orders and rules to ensure fair practices.

The Secretary of Labor or their representatives can inspect recruitment agencies' premises, books, and records, request reports, and address any violations of the Labor Code.

Any recruitment activity conducted by unlicensed or unauthorized individuals or entities, including the prohibited practices mentioned earlier, is deemed illegal.

Penalties for illegal recruitment vary depending on the scale. If committed by a syndicate or in large scale, it's considered economic sabotage and can lead to imprisonment.

The Secretary of Labor can order the arrest of illegal recruiters if their activities threaten national security. They can also conduct searches, seize evidence, and close down illegal recruitment businesses.

The Minister of Labor has the authority to suspend or revoke a recruitment agency's license if they violate rules or laws.

Generally, Filipino workers cannot be hired directly for overseas jobs. Employers must go through licensed agencies, with some exceptions.

This office provides support and connects with overseas Filipino communities, helping with issues they might face abroad.

This body focuses on Filipino seafarers working overseas, offering support and regulating their employment conditions.

Regional offices handle employer-employee disputes for Filipino workers overseas, providing a local point of contact.

Generally, public employment offices are the primary recruiters for all jobs, except for specific exemptions.

The fees collected are deposited into a fund dedicated to specific purposes, supporting the government's initiatives for workers.

The Secretariat manages the manpower development plan, allocates resources, implements programs, and reports progress to the Council.

The Council, not the Secretariat, approves the manpower plan and resource allocation.

These offices assess local manpower needs, provide data to the national planners, and recommend regional programs.

The Council can hire consultants and organizations for research and publications to support its work.

The goal of the apprenticeship program is to train skilled workers to meet the economy's needs.

An apprentice is a worker learning a trade through on-the-job training and theoretical instruction.

A job requiring more than 3 months of on-the-job training and theoretical instruction.

A contract between the employer and apprentice outlining training terms and wages.

To be an apprentice, one needs to be at least 14 years old, have vocational aptitude, and understand instructions.

Only highly technical industries can employ apprentices and only in approved occupations.

Agreements include wage rates, conform to Labor rules, and have a maximum period of six months.

Both the employer and apprentice sign the agreement, minors require parental consent.

These committees ratify apprenticeship agreements and ensure compliance.

Apprentices may start below minimum wage, but never below 75% of it, under approved programs.

The Department of Labor creates standardized guidelines for apprenticeship programs.

Different ways to organize apprenticeship programs, like in-house training, public training centers, or combination approaches.

A firm, group, or organization can sponsor an apprenticeship program, providing training for apprentices.

Apprentice training can happen at the sponsor's premises, designated firms, or government training centers.

The Department of Labor can investigate if someone violates an apprenticeship agreement.

If you disagree with a Department of Labor decision, you can appeal to the Secretary of Labor within 5 days.

You can't go directly to court for issues with an apprenticeship agreement; you must resolve it through the Department of Labor first.

Employers or organizations with apprenticeship programs are in charge of selecting apprentices through aptitude tests, or the Department of Labor can help.

Apprentices can get theoretical instruction from their employer or a government agency.

Apprenticeship programs are usually voluntary, but the President can make them compulsory in specific trades if there's a severe need for skilled workers.

Businesses can deduct half of their training costs from their taxes if the apprenticeship program is recognized.

The Secretary of Labor can allow apprentices to work without pay if their school or training program requires it.

Learners are trainees in non-apprenticeable jobs, learning skills on the job for a shorter duration than apprentices.

Companies can hire learners when skilled workers aren't available, it's needed to prevent job losses, and it won't cause unfair competition.

When employers hire learners, they must have a written agreement with them, outlining details like duration, wages, and potential future employment.

Learners working the first 2 months of training become regular employees if training ends early due to the employer's fault.

Learners working on piece-rate jobs during training must be paid the full rate for their completed work.

Handicapped workers are individuals whose ability to earn a living is limited due to age, physical, or mental impairments.

Handicapped workers can be hired if it's necessary to prevent job losses and doesn't create unfair competition in wages.

Employers hiring handicapped workers must have a written agreement including details about the worker, wage, duration, and tasks

Handicapped workers can be apprentices/learners if their disability doesn't affect their ability to do the job.

Normal workday is 8 hours except for certain health workers in large cities and hospitals with specific extra pay rules.

Hours worked include time on duty, at the workplace, and time when the employee is allowed to work even if it's not required.

Employers must provide employees at least 60 minutes for their regular meals.

Workers on night shifts must receive at least 10% extra pay for each hour worked between 10 PM and 6 AM.

Overtime (beyond 8 hours) gets standard hourly wage plus 25% extra. Overtime on holidays/rest days gets even higher pay.

Being short on hours one day cannot be made up by working longer hours another day. Leave time doesn't excuse paying overtime.

Employers can require overtime during emergencies, but must pay the standard overtime rates.

'Person' includes individuals, partnerships, associations, corporations, trusts, legal representatives, or any organized group.

An 'Employer' is anyone acting directly or indirectly for the benefit of an employer, including the government and its branches, corporations, and non-profit organizations.

An 'Employee' is anyone hired by an employer.

'Agriculture' includes farming, cultivation, growing and harvesting crops, raising livestock, and farm-related tasks, excluding processing of certain products.

'Employ' means to suffer or permit someone to work.

A 'Wage' is any remuneration or earnings, in money, payable to an employee for work done or to be done, including the value of benefits.

'Fair and reasonable value' of benefits does not include any profit for the employer.

The Labor Code does not apply to farm tenancy or leasehold, domestic service, home-based needlework, or cottage industries duly registered by law.

Regional Tripartite Wages and Productivity Boards determine minimum wage rates for each region.

The Labor Code cannot reduce or eliminate employee benefits that were already in place.

The Secretary of Labor regulates 'payment by results' wages, like piecework, to ensure fairness, preferably using time and motion studies or worker/employer consultations.

Employers cannot pay wages with promissory notes, vouchers, tokens, or anything other than legal tender.

Wages must be paid at least twice a month at intervals not exceeding sixteen days, but can be paid every two weeks instead.

Wages must be paid at or near the place of work, unless the Secretary of Labor prescribes otherwise.

It's illegal for an employer to take money from an employee's wages as a condition of employment.

An employer can't punish a worker for filing a complaint or testifying about illegal work practices.

It's illegal to provide false information in any report related to labor laws or regulations.

This government body advises the President and Congress on wages, incomes, and productivity.

The Commission sets guidelines for wages, studies labor issues, and recommends policies for productivity improvement.

The Commission reviews wage levels set by regional boards to ensure they match national development plans and guidelines.

The employer is ultimately responsible for paying wages to all employees working on a project, even if the work is done by a contractor or subcontractor.

When an employer and contractor are both legally responsible for paying workers, and each can be sued for the full amount – even if the other party doesn't pay.

When a person supplies workers to an employer without significant capital or investment in tools, equipment, or facilities, and the workers do work directly related to the employer's main business.

The person or intermediary supplying the workers is seen as the employer's agent, and the employer is directly responsible to the workers.

When a person, partnership, or corporation contracts with an independent contractor for work, they are considered an indirect employer and are also responsible for worker wages.

An employer or indirect employer can require a contractor to provide a bond equal to the cost of labor, guaranteeing payment to workers if the contractor defaults.

Both the employer and contractor are considered direct employers and share responsibility for any labor code violations, even if they are separately contracted.

Workers' unpaid wages and monetary claims have top priority in a company's bankruptcy, before government or other creditor claims.

The guilty party may be charged attorney's fees equaling 10% of the recovered wages.

It's illegal to demand or accept more than 10% of recovered wages as attorney's fees in wage recovery cases.

Employers can only deduct from wages for insurance premiums, union dues, or when legally authorized.

Employers can require deposits for lost or damaged tools only when the practice is common in the industry or when the Secretary of Labor approves it.

Deductions from worker deposits for losses can only happen after a hearing where employee responsibility is clearly shown.

It's illegal to withhold wages, or force a worker to give up part of their wages through threats or coercion.

An employee may be required to work beyond regular hours in certain situations, such as emergencies, urgent repairs, preventing loss of goods, or completing important tasks.

Employees working overtime must be paid additional compensation according to the Labor Code. This pay is calculated based on their regular wage.

The 'regular wage' used to calculate overtime pay includes only the employee's cash wage, excluding any benefits or allowances from the employer.

Every employee is entitled to a minimum of 24 consecutive hours of rest after working six consecutive days. The employer decides the rest day, respecting religious preferences.

An employer can require work on a rest day in cases of emergency, urgent repairs, or when special circumstances demand it.

Employees working on their scheduled rest day are entitled to an additional 30% of their regular wage as compensation.

Employees working on Sundays receive an additional 30% of their regular wage, specifically when Sunday is their established rest day.

Employees working on holidays are paid twice their regular rate. The law lists specific holidays.