Philippines Labor Management QA

Email: mnl4ww@evershinecpa.com
or
Contact by Viber or Skype during working hours of the Philippines time zone.
For Philippines going-out cases, the coordinator window will be:
Manila Branch of Evershine BPO Service Corp. in Taiwan
Project Manager Meiling Wu, who speaks both English and Tagalog.
Viber: +886966173105
Skype: wumeiling25

LRC – Philippines Labor Regulations

LRC-CA-20.10
What must be included in the contents of a labor contract in Philippines?

Evershine RD:
According to Labor Code, 1974 (as amended), art. 281.
The Labor Code does not contain specific requirements for employment contracts.

LRC-CA-20.11
Do the Philippines arrange labor contracts in the fixed term?
What should be the length of the labor contract in the Philippines?

Evershine RD:
According to Labor Code, 1974 (as amended), art. 281.
Employees can be hired for a trial period.
The maximum trial period is 6 months unless a worker is involved in an apprenticeship program and a longer period is stipulated.

LRC-CA-20.20
What is the minimum age for hiring new employee in Philippines?

Evershine RD:
According to Labor Code, 1974 (as amended), art. 18, 40, 139.
Children younger than 15 years of age cannot be employed except by parents or guardians and only then if the employment does not interfere with schooling.
Children aged 15 to 17 may be employed for a reasonable number of hours as determined by the labor secretary.
Youths under 18 cannot be employed in dangerous jobs.

LRC-CA-20.40
Is it a requirement for employers in the Philippines to conduct a pre-employment background check?

Evershine RD:
According to Occupational Safety and Health Standards, 1989, S 1966.02.
The Occupational Safety and Health Standards require physical examinations for all workers when they enter the labor force or change jobs and periodically during their employment.

LRC-CA-20.50
Is the Non-Competition indemnity clause in labor contract in Philippines has legal effect?

Evershine RD:
The Labor Code does not address non-competition agreements.

LRC-CA-40.05
What are the regulations on Gender Discrimination in employment specifically for female workers in Philippines?

Evershine RD:
According to Labor Code, 1974 (as amended), art. 135.
Employers are prohibited from discriminating against women in conditions of employment, including paying them less than male employees for work of equal value or providing them with fewer opportunities for promotion, training or study and scholarship grants solely on account of their sex.
Employers are prohibited from firing a female employee because of her pregnancy or while she is on leave or in confinement due to her pregnancy.
It is also unlawful for an employer to discharge a woman or refuse her return to work for fear that she may again be pregnant.

LRC-CA-50.10
Can the employer in the Philippines collect, or process data transmitted by employees over the internet?

Evershine RD:
According to Data Privacy Act, Regulations, 2016, Rule IV.
Monitoring and surveillance of employees are subject to the following principles:

•   the employee must be aware of the nature, purpose, and extent of the processing of his or her personal data, including the risks and safeguards involved, the identity of the personal information controller, his or her rights as a data subject, and how these rights can be exercised
•   any information and communication relating to the processing of personal data should be easy to access and understand, using clear and plain language
•   the monitoring must be lawful and fair; and
•   the processing of the information must be adequate, relevant, suitable, necessary, and not excessive in relation to a declared and specified purpose.

LRC-CA-60.10
What are the regulations on working hours in the Philippines?

Evershine RD:
According to Labor Code, 1974 (as amended), arts. 83, 85, 91, 93.
A normal workday is 8 hours.
Employees are entitled to at least 24 consecutive hours off from work after 6 consecutive workdays.

LRC-CA-60.30
What are the regulations on overtime hours in Philippines?
What is the overtime premium rate in Philippines?

Evershine RD:
According to Labor Code, 1974 (as amended), art. 87.
Any work hours more than 8 hours in a day:

Holiday pay is applicable for private-sector employer except retail and service establishments employs less than 10 workers:

LRC-CA-60.50
Is it common to pay 13^th month’s salary in the Philippines?

Evershine RD:
According to Presidential Decree No. 851, 1975, S 1.
Under a 1976 presidential decree and later amendments, employers are required to pay employees who work at least 1 month during the calendar year an extra month’s pay —the “13th month pay”—no later than Dec. 24.
The 13th month pay cannot be less than one-twelfth of the total basic salary earned by an employee in a calendar year.

LRC-CA-70.10
What are the regulations on general leave policy for employees in the Philippines?

Evershine RD:
According to Labor Code, 1974 (as amended), art. 95.
Every employee of a business with 10 or more employees who has worked for that employer for at least a year is entitled to 5 days of leave paid at his or her regular rate, known as “service incentive leave”.
Unused service incentive leave may be cashed in at the end of the year.

LRC-CA-70.20
What are the public holidays in the Philippines?
What is the overtime premium rate during public holiday in the Philippines?

Evershine RD:
According to Labor Code, 1974 (as amended), art. 93-94.
Employees are entitled to the following 8 paid holidays:

•   Jan. 1: New Year’s Day
•   Maundy Thursday
•   Good Friday
•   Bravery Day
•   Labor Day
•   Independence Day
•   Christmas Day
•   Rizal Day

In addition, the government each year announces several special holidays, which are unpaid days off and may change from year to year.
These have included:

•   Chinese New Year
•   End of Ramadan
•   Festival of Sacrifice
•   Monday nearest Aug. 21: Ninoy Aquino Day
•   Last Monday in August: National Heroes Day
•   Nov. 1-2: All Saints Day
•   Monday nearest Nov. 30: Bonifacio Day
•   Dec. 24: Christmas Eve
•   Dec. 31: Last Day of the Year

The Philippines recognizes various holidays that are categorized as either regular holidays or special (nonworking) days.

LRC-CA-70.30
What is the maternity leave policy for female employee in the Philippines?

Evershine RD:
According to Act Increasing Maternity Benefits, No. 7322.
Female employees are entitled to 105 days of paid maternity leave.
For cases of miscarriage or emergency termination of pregnancy, the employee is entitled to 60 days paid leave (78 days paid leave for Cesarean delivery).
Single mothers are entitled to an additional 15 days of paid maternity leave, and all new working mothers can take an extra 30 days of unpaid leave.
Female employees receive benefits equivalent to 100% of their average daily salary.
Female employees have the option to allocate up to 7 days leave to the child’s father, regardless of whether the father is married to the female employee.
An employee who already has 4 children cannot get maternity leave for any further pregnancies.

LRC-CA-70.40
What is the paternity leave policy for male employee in the Philippines?

Evershine RD:
According to Republic Act, No. 8187, 1996, S 2.
Every employer must grant 7 days of paid paternity leave to all married male employees- regardless of employment status (eg: probationary, regular, contractual, project-based)- after the birth of a child or a wife’s miscarriage.
The leave can only be used for the employee’s first four children.
Additionally, female employees have the option to allocate up to seven days of their maternity leave to be used by the child’s father.

LRC-CA-70.50
What are the provisions on sick leave, bereavement leave and personal leave for employees in Philippines?

Evershine RD:

According to Republic Act, No. 8972, 1997, S 14

Sick leave

The Labor Code does not provide for sick leave, but employers usually provide this through collective bargaining agreements.
Workers who have used up or do not have any sick leave but have made at least 3 months of contributions into the Social Security System in the prior 12 months and whose injury or illness leaves them unable to work for at least 4 days are eligible for the social security sickness benefit.
The sickness benefit pays about 90 percent of average salary for up to 120 days in a calendar year.

According to Republic Act, No. 8972, 2000, SS 6-8.

Other leave
Solo parents- defined as single parents, parents otherwise left alone with the responsibility of parenthood because of the disability or imprisonment of a spouse or abandonment by a spouse or another family member who alone assumes responsibility for the care of a child- are entitled to 7 days of paid leave a year after their first year of service with an employer.
Employers must also accommodate solo parents through such measures as flexible work schedules and cannot discriminate against them.

LRC-CA-70.60
What are the regulations on pension benefits and social security insurance benefits for employee in the Philippines?

Evershine RD:
According to Social Security Law, Republic Act, No. 8282, 1997, S 12-B.
There are several forms of retirement benefits, including those provided by employers in collective bargaining agreements, those required under the Labor Code and those paid under the Social Security System.
Retirement is compulsory at age 65. Employees aged 60 or older who have made contributions for at least 120 months can also retire with benefits.
The minimum retirement pay due employees under the Labor Code is one half month’s salary for every year of service.
Retirement provisions in collective bargaining agreements must at a minimum provide this level of benefits.
In addition, retirees receive benefits from the Social Security System. Those who have made at least 120 monthly contributions into the system receive a monthly pension, the amount depending on how many contributions they have made, how many years they have been in the system and how many dependent children they have.

LRC-CA-70.70
What are the regulations on Workers’ Compensation for employee in Philippines?

Evershine RD:
According to Social Security Law, Republic Act, No. 8282, 1997, SS 13-14.

LRC-CA-80.05
Can the employee in the Philippines join labor union?

Evershine RD:
According to Labor Code, 1974 (as amended), arts. 243-246.
Both the constitution and the Labor Code guarantee workers’ right to organize and the law prohibits anyone from interfering with this right through either coercion or discrimination.
Under the Labor Code, managers and most civil servants are banned from joining unions.
Supervisory employees cannot join the same labor organization as rank-and-file workers, but they are permitted to form their own labor organizations.
Intermittent workers, itinerant workers, the self-employed and rural workers may also join to form labor organizations.

LRC-CA-80.06
How to handle labor dispute in Philippines?

Evershine RD:
According to Labor Code, 1974 (as amended), arts. 247-248.
The parties to a labor dispute are encouraged to use voluntary conciliation/mediation or whatever grievance processes are laid out in a collective bargaining agreement.
If the parties do not wish to use conciliation or the process does not resolve the dispute, the matter can be taken to labor arbiters at the National Labor Relations Commission.
Arbiter decisions can be appealed to the NLRC, whose decisions are binding on the parties.
Cases involving alleged unfair labor practices by employers or labor organizations can be taken to National Labor Relations Commission arbiters.
Parties found guilty may be subject to criminal prosecution.

LRC-CA-90.10
What are the regulations on workplace safety and health for employee in Philippines?

Evershine RD:
According to Occupational Safety and Health Standards, 1989 (as amended), SS 1041-1042.
The law allows workers to refuse to work if hazards arise in their workplace.
It also requires employers to establish a committee to implement and monitor the company’s safety and health program.
The committee must be led by an employee and composed of a safety officer, medical personnel, and union representatives.
Employers must provide a range of free medical services that vary depending on the size of the employer and in some cases the type of work.

LRC-CA-100.10
What are the circumstances that an employer can terminate an employee in Philippines?

Evershine RD:
According to Labor Code, 1974 (as amended), arts. 279-282.
Termination by an employer generally requires just cause and due process.
Termination is justified for any of the following causes:

•   serious misconduct or willful disobedience connected to work-related duties
•   gross and habitual neglect of work duties
•   fraud or willful breach of trust
•   commission of a crime or offense against the employer, an immediate member of the employer’s family or employer representatives and
•   similar types of behavior.

In addition to just cause and termination of workers on probation, the Labor Code allows for dismissal in cases of redundancy, the closure of a business or if an employer learns that an employee has a disease that makes his or her continued employment unlawful or harmful to the worker’s own health or the health of co-workers.

LRC-CA-100.11
What is the notification period for terminating an employee in Philippines?
How much is the severance pay?

Evershine RD:
According to Labor Code, 1974 (as amended), art. 283-284.
Employees are entitled to 1 month’s notification with an explanation prior to the intended date of dismissal and to a chance—accompanied by representatives—to defend themselves.
Under the Labor Code, separation pay is required only in cases of layoffs, business closure or termination because of a disease.
Employees terminated because of redundancy are entitled to 1 month’s pay for every year of service.
If an employer is restructuring to prevent losses or is closing a business, terminated employees are entitled to 1 month’s pay or 1/2 month’s pay for every year of service, whichever is higher.
If an employer terminates an employee for reason of disease, the employee is entitled to one month’s pay or 1/2 month’s pay for every year of service, whichever is higher.

LRC-CA-100.12
What is the reporting requirement for employers in Philippines to notify the termination of employees to competent authority?

Evershine RD:
According to Labor Code, 1974 (as amended), art. 152.
When required by public interest, the secretary of labor may direct companies to submit a report on the status of employment, including job vacancies, details of job requisitions, separation from jobs, wages, other terms and conditions of employment and other employment data.

LRC-CA-100.20
What are the regulations on mass layoffs in the Philippines?

Evershine RD:
According to Labor Code, 1974 (as amended), art. 283.
The Labor Code requires an employer to provide 1 month’s written notification of termination due to the installation of labor-saving devices, redundancy, retrenchment to prevent losses or the closing of a business.
Affected employees are entitled to separation pay; the amount of such pay is determined by the reason for termination.

LRC-CA-100.30
What is the time limit for employers in the Philippines to pay employees upon termination?

Evershine RD:
It should be pay at the time of final payment which is within 30 days from the effective date of termination unless there is a more favorable company policy, or agreement with employer.

Contact Us

Manila Evershine BPO Service Limited Corp.
E-mail: mnl4ww@evershinecpa.com
or
Contact by Viber or Skype in working hours of Philippines time zone.
For Philippines going-out cases, the coordinator window will be:
Manila Branch of Evershine BPO Service Corp. in Taiwan
Project Manager Meiling Wu, who speaks both English and Tagalog.
Viber: +886966173105
Skype: wumeiling25

or
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please send an email to HQ4mnl@evershinecpa.com
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Email address:dalechen@evershinecpa.com
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