FIFTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
First Regular Session 
) 
) 
) 
SEN~Te 
S. No. 
·i!43.l 
'~.l. " 
) 
Introduced by Senator Miriam Defensor Santiago 
EXPLANATORY NOTE 
The Constitution, Article 2, Section 18 provides: "The State affinns labor as a primary 
social economic force. It shall protect the rights of workers and promote their welfare." 
This state policy is reiterated in Article 13, Section 3 which provides that the State shall 
afford full protection to labor; guarantee the right of workers to security of tenure, humane 
conditions of work, living wage and participation in policy and decision-making processes 
affecting their rights and benefits as may be provided by law. 
"Living wage" is defined as one that ensures a "decent standard of human existence 
beyond mere subsistence level". On the other hand, "minimum wage" is defined as the basic pay 
or daily wage plus cost of living allowance received by a worker, not falling under the 
exemptioils as provided under the Wage Rationalization Act. 
The minimum wage fixed by law is lower than the ideal living wage. Compliance by 
corporations and other work establishments has remained a persistent problem. 
In 1995, non-compliance was estimated to be 53%. It dropped to 20% m 1999 but 
increased to almost 30% the following year. The succeeding years showed a continued 
resurgence of minimum wage violations which DOLE estimated to be 45%, but this data only 
represents the finns that the Department has inspected and found to have violated wage 
regulations. Admittedly, as it remains undennanned to conduct consistent monitoring and 
enforcement strategies, the estimates of noncompliance can go as high as 60%, reverting to the 
trends of the mid-1990s, despite a dearth of enforcement and compliance studies on this matter. 
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With enhanced monitoring by the DOLE and the proposed amendments under this bill it 
is expected that the mantle of protection we can stretch for our workers will be much more 
assured. 
This qill was originally filed by President Benigno S. Aquino III during the Fourteenth 
Congress. 
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FIFTEENTH CONGRESS OF THE REPUBLIC 
) 
OF THE PHILIPPINES 
) 
First Regular Session 
) 
SENATE 
S.No. 2433 
Introduced by Senator Miriam Defensor Santiago 
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AN ACT 
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INCREASING THE PENALTIES FOR NON-COMPLIANCE OF THE 
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PRESCRIBED INCREASES AND ADJUSTMENTS IN THE WAGE RATES OF 
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WORKERS, AMENDING FOR THE PURPOSE REPUBLIC ACT NO. 6727, 
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OTHERWISE KNOWN AS THE "WAGE RATIONALIZATION ACT" 
Be it enacted by the Senate and the House of Representatives of the Philippines in 
Congress assembled: 
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SECTION I. Section 12 of Republic Act 6727, as amended by Republic Act No. 8188, is 
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hereby fmiher amended to read as follows: 
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Section 12. Any person, corporation, trust, firm, partnership, association 
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or entity which refuses or fails to pay any of the prescribed increases or 
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adjustments in the wage rates made in accordance with this Act shall be punished 
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by a fine [not less than Twenty-five thousand pesos (P25,OOO) nor more than One 
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hundred thousand pesos (PIOO,OOO)] NOT. LESS THAN ONE HUNDRED 
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THOUSAND PESOS (PIOO,OOO.OO) PLUS MORAL DAMAGES NOT 
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EXCEEDING THIRTY THOUSAND PESOS (P30;OOO.OO) FOR EACH 
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AFFECTED WORKER AND THE COSTS OF LITIGATION INCLUDING 
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ATTORNEY'S FEES or imprisonment of not less than two (2) years nor more 
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than four (4) years, or both such fine and imprisonment at the discretion of the 
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court: Provided, That any person convicted under this Act shall not be entitled to 
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the benefits provided for under the Probation Law. 
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The employer concerned shall be ordered to pay an amount equivalent to 
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double the unpaid benefits owing to the employees: Provided, That payment of 
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indemnity shall not absolve the employer from the criminal liability imposable 
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under this Act. 
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If the violation is committed by a corporation, trust or firm, partnership, 
, 
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association or any other entity the penalty of imprisonment shall be imposed upon 
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the entity's responsible officers, including, but not limited to, the president, vice-
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president, chief executive officer, general manager, managing director or partner." 
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IN CASES WHERE A FINE IS DECREED BY THE NATIONAL 
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LABOR RELATIONS COMMISSION (NLRC) AGAINST PERSON/S 
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WHO VIOLATED THE PROVISIONS OF THIS ACT AND CANNOT BE 
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IMMEDIATELY SATISFIED BECAUSE OF REFUSAL TO PAY, OR IN 
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CASE OF THE UNAVAILABILITY OR INADEQUACY OF FUNDS, THE 
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BANK DEPOSITS, FINANCIAL INTERESTS AND OTHER PERSONAL 
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PROPERTY NOT CAP ABLE OF MANUAL DELIVERY IN THE 
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POSSESSION OR CONTROL OF THIRD PARTIES OF THE OWNER IN 
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CASE OF SOLE PROPREITORSHIP OR THE ASSETS OF THE 
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CORPORATION, ASSOCIATIONS OR ANY OTHER ENTITY, SHALL 
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BE AUTOMATICALLY GARNISHED. 
IF SUCH PROPERTIES ARE 
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NOT ENOUGH, MOVABLE AND IMMOVABLE PROPERTIES MAYBE 
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LEVIED TO SATISFY FULLY THE IMPOSED FINES. 
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SECTION 2. The penalties provided under this Act shaH also be applicable in cases 
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involving workers hired by contractors undertaking infrastructure projects under R.A. No. 6685 
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and in relatiqn to DOLE Order No. 19, with respect to any violation in the payment of wages or 
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its appropriate wage increases. 
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SECTION 3. Separability Clause. - If any provision of this Act shaH be declared 
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unconstitutional, any other provision not affected thereby shall remain in fuH force and effect. 
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SECTION 4. Repealing Clause. - All laws', decrees, orders, rules and regulations, or 
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parts thereof inconsistent with this Act ate hereby repealed or amended accordingly. 
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• 
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SECTION 5. Effectivity. - This Act shall take effect fifteen (15) days after its publication 
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in at least two (2) national newspapers of general circulation. 
Approved, 
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