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SIXTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
First Regular Session 
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SEP 1 0 1\11:01 
SENATE 
Senate Bill No. 1592 
RECJ:;IVED HY:-f-
-----------------------------------------------------------
INTRODUCED BY SEN. JINGGOY EJERCITO ESTRADA 
EXPLANATORY NOTE 
Section 9 of RA 6727, otherwise known as the Wage Rationalization Act, 
provides that the Department of Labor and Employment shall conduct inspections 
as often as possible within its manpower constraint of the payroll and other 
financial records kept by the company or business to determine whether the 
workers are paid the prescribed wage rates and other benefits granted by law or 
any Wage Order. 
However, there are only about 100 labor inspectors tasked to inspect 
almost 1,000,000 establishments nationwide. The lack of labor inspectors partly 
explains the low rate of compliance with existing wage orders and labor laws. 
Their low salaries lends credence to the perennial accusations by the labor 
sector, and sometimes, even ,by. the employer sector, that some labor inspectors 
are prone to corruption and extortion. 
It has been posited that the Philippines has enough labor laws and social 
legislation. The problem is purportedly in their implementation and enforcement. 
This bill seeks to ensure that existing labor laws and social legislations are 
complied with, even as new ones are being enacted. 
Hence, the urgent passage of this bill is fervently requested. 
GOY EJERCITO ESTRADA 
Senator 


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SIXTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
) 
) 
First Regular Session 
'13 
SEP 1 0 All:Oi 
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SENATE 
Senate Bill No. 1 S 9 2 
RrX'J!:IVED IP';_.~_ 
INTRODUCED BY SEN. JINGGOY EJERCITO ESTRADA 
AN ACT 
STRENGTHENING THE INSPECTION FUNCTION OF THE DEPARTMENT OF 
LABOR AND EMPLOYMENT, AMENDING FOR THIS PURPOSE REPUBLIC 
ACT NO. 6727, OTHERWISE KNOWN AS THE WAGE RATIONALIZATION 
ACT, AND FOR OTHER PURPOSES 
Be if enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled: 
SECTION 1. Section 9 of Republic Act No. 7627, otherwise known as the 
Wage Rationalization Act, is hereby amended to read as follows: 
"Sec. 9. The Department of Labor and Employment shall 
conduct inspections as, often· ,as possible within its manpower 
constraint of the payroll and other financial records kept by the 
company or business to 
determine whether the workers are paid 
the prescribed wage rates and other benefits granted by law or any 
Wage Order. In unionized companies, the Department of Labor and 
Employment inspectors shall always be accompanied 
by 
the 
president or any responsible officer of the recognized bargaining 
unit of any interested union in the conduct of the inspection. In 
non-unionized companies, establishments or businesses, the 
inspection shall be carried out in the presence of a worker 
representing the workers in the said company. The workers' 
representative shall have the right to submit his own findings to the 
Department of Labor and Employment and to testify on the same if 
he cannot concur with the findings of the labor inspector. 
"FOR THIS PURPOSE, THE FORMER POSITION OF 
LABOR INSPECTOR IS HEREBY ABOLISHED, AND A NEW 
POSITION OF LABOR INSPECTOR, WITH THE SALARY GRADE 
OF 21, IS HEREBY CREATED IN THE FOLLOWING RATIO: ONE 
(1) LABOR INSPECTOR FOR EVERY MUNICIPALITY, AND AT 
LEAST TWO (2) LABOR INSPECTORS FOR EVERY CITY. 
"IN ADDITION TO THEIR REGULAR FUNCTIONS, LABOR 
INSPECTOR SHALL HAVE THE AUTHORITY TO INITIATE AND 
FILE CRIMINAL ACTIONS AGAINST PERSON, CORPORATION, 
TRUST, FIRM, PARTNERSHIP, ASSOCIATION OR ENTITY 
WHICH 
REFUSES 
OR 
FAILS 
TO 
PAY ANY 
OF 
THE 
PRESCRIBED INCREASES OR ADJUSTMENTS IN THE WAGE 
RATES MADE IN ACCORDANCE WITH THIS ACT. THEY SHALL 
ALSO HAVE THE POWER TO ISSUE SUBPOENA, ADMINISTER 
OATH 
OR 
AFFIRMATION, 
AND 
CALL 
UPON 
LAW 


ENFORCEMENT 
AGENCIES 
TO 
ASSIST 
THEM 
IN 
CONDUCTING INSPECTIONS. 
"THE FUNDS NECESSARY TO CREATE THE NEW 
POSITION OF LABOR INSPECTOR SHALL BE TAKEN FROM 
THE INTERNAL REVENUE ALLOTMENT OF THE LOCAL 
GOVERNMENT UNITS CONCERNED. 
"ALL 
PERSONNEL 
OF 
THE 
ABOVE 
ABOLISHED 
POSITION 
SHALL CONTINUE TO FUNCTION IN A HOLDOVER 
CAPACITY AND 
SHALL BE PREFERENTIALLY CONSIDERED 
FOR APPOINTMENTS 
TO OR PLACEMENT IN THE NEW 
POSITION OF LABOR INSPECTOR; 
PROVIDED THAT THEY 
QUALIFY UNDER THE CRITERIA TO BE PRESCRIBED BY THE 
SECRETARY OF LABOR AND EMPLOYMENT. 
"ANY LABOR INSPECTOR SEPARATED FROM THE 
SERVICE AS A RESULT OF THE ABOLITION OF POSITION 
PURSUANT TO 
THIS 
ACT 
SHALL 
BE 
ENTITLED 
TO 
APPROPRIATE SEPARATION PAY AND RETIREMENT AND 
OTHER BENEFITS ACCRUING TO THEM UNDER 
EXISTING 
LAWS. 
IN 
LIEU THEREOF, AT THE OPTION 
OF THE 
EMPLOYEE, HE SHALL BE PREFERENTIALLY CONSIDERED 
FOR EMPLOYMENT IN THE GOVERNMENT OR IN ANY OF ITS 
SUBDIVISIONS, 
INSTRUMENTALITIES, 
OR 
AGENCIES, 
INCLUDING GOVERNMENT-OWNED 
OR 
CONTROLLED 
CORPORATIONS ANp JHE..II~ SUBSIDIARIES." 
SEC. 2. This Act shall take effect fifteen (15) days after its complete 
publication in the Official Gazette or in at least two (2) national papers of general 
circulation, whichever comes earlier. 
Approved,