THIRTEENTH CONGRESS OF THE REPUBLIC) 
OF THE PHILIPPINES 
1 
Third gegular Session 
1 
S E N A T E  
Introduced by Senator QsmeAa 111 
EXPLANATORY NOTE 
Never in the country's labor history has so many Filipinos toiled in ambulant and 
hawking chores to earn their living. Despite the tangible strides in the economic front, 
unemployment persists to stalk the country. While there are some who directly gain 
from the necessary economic gains of the government, the majority does not. This 
compounds the widespread hunger prevailing in the Philippines. 
As a consequence to this odious and unpleasant reality, Filipinos, in their 
indigenousness and ingenuity, pursue unconventional, but decent means of livelihood 
- peddling their wares, hawking their merchandise, offering their services, and 
numerous other unorganized, undirected, individual menial tasks to generate income. 
Thus, in the urban and big rural centers, one finds numerous hawkers, vendors, 
peddlers, and the like cajoling, enticing or coaxing passers by who care to stop or 
listen to vend their wares or offer their services. 
These people are those which we call the informal workers of society. They are 
so called because they are undocumented, unregistered, uninsured, untaxed, 
undeclared, disorganized, uncontrolled and left to their own volition in the pursuit of 
their means of maintaining life. Oftentimes, they get exploited by unscrupulous 
capitalists who happen to transact business with them. 
By their very nature and operation, workers belonging to the informal sector are 
excluded from the coverage of the Labor Code and other pieces of social legislation. 
As a result, they are subject to exploitation by businesses and factories which often 
resort to subcontracting, low wages, long hours of work, absence of fringe benefits, 
and the like. Moreover, women and children who fall into this sector are likewise 
vulnerable to exploitation from wholesalers, moneylenders and corrupt police 
authorities through "kotong" or extortion. Furthermore, the absence of a monitoring 
system and regulations to protect their respective working environment have made 
them exposed to health and safety risks. 
Moreover, this bill introduces an integrated, holistic and comprehensive policy 
instrument for the Informal Sector to bring them into the mainstream of Philippine 
economy . 


In view of the great effect and impact this sector has on our society, this 
proposed bill Magna Carta for the Workers in the Informal Sector seeks to promote 
and protect their interests by providing adequate and timely social, economic and legal 
services, as well as mechanisms that shall protect their rights and provide benefits to 
ensure a dignified existence and economic advancement. 
In view of the foregoing, the early passage of this bill is earnestly sought 
SE%GIO R. OSMERA 111 
Senator 


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THIRTEENTH CONGRESS OF THE REPUBLIC) 
OF THE PHILIPPINES 
1 
Third Regular Session 
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Introduced by Senator Osmeiia 111 
AN ACT 
PROVIDING FOR A MAGNA CARTA FOR THE WORKERS IN THE INFORMAL 
SECTOR, ESTABLISHING A MECHANISM FOR ITS IMPLEMENTATION AND FOR 
OTHER PURPOSES 
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled: 
TITLE I 
GENERAL PROVISIONS 
Chapter I 
Framework and Principles 
SECTION 1. Short Title. - This Act shall be known as the “Magna Carta for the 
Workers in the Informal Sector”. 
SEC. 2, Declaration of Policy. - It is hereby declared the policy of the State: 
(a) To promote and improve the total well-being of the poorest and the 
marginalized low level income earners in the country who are engaged in 
economic activities under the Informal Sector, hereinafter referred to as IS; 
(b) To promote and protect the interests of the IS by providing adequate and 
timely social, economic and legal services, as well as mechanisms that shall 
protect their rights and provide benefits to ensure their dignified existence 
and economic advancement; and 
(c) To recognize the rights of every worker in the IS especially women and 
children, to protect them from abuse, economic exploitation and hazardous 
work that prejudice their physical, mental and spiritual well-being. 


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Towards this end, the State shall come up with an integrated, holistic and 
comprehensive policy instrument for the IS that shall promote the following: 
(I) 
Enhancement of entrepreneurial skills and capabilities for more productive 
and self-reliant members of the sector; and 
(2) A continuing process of consultation and dialogue with said sector to 
maximize the available reform intervention services. 
SEC. 3. Definition of Terms. - As used in this Act, the following terms shall 
Daily Basis - per day mode of paying a private worker as bilaterally agreed 
upon by both the employer and the worker; 
Employer - a natural person, or group, or partnership of people for which a 
paid worker renders productive employment or service. This includes any 
person acting in the interest of an employer, directly or indirectly; 
Hazardous work or condition - any activity or circumstance where a 
worker is exposed to any risk which constitutes an imminent danger to 
hislher health and safety; 
Informal Sector (IS)- a category of individuals or partnership of people 
involved in any business activity or enterprise whose total assets, inclusive 
of the capital investments, must not be more than Ten Thousand Pesos 
(PlO,OOO.OO) for single proprietorship and Twenty-five Thousand Pesos 
(P25.000) for partnership ventures or whose annual income does not 
exceed Thirty-five Thousand Pesos (P35,OOO.OO) and One Hundred Fifty 
Thousand Pesos (PI 50,000.00), 
respectively; 
"Kasambahay" or household helper ~ 
any person, who is to be engaged, 
is engaged or has been engaged locally, in a salaried capacity under a 
full-time basis, paid directly by the employer, and undertaking tasks 
ascribed as normal household chores within a specific household. This 
include6 maids, cooks, houseboys, family drivers and babysitters (yaya) 
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who provide daily service to a single, specik household, either on a live-in 
or live-out basis; 
Micro-entrepreneur - includes side walk and fish vendors and small scale 
farmers and fisher folks; 
Monthly Basis - the per month mode of paying a private worker as 
bilaterally agreed upon by both the employer and the worker; 
“Pakyaw” Basis - refers to the pre-contracted wholesale mode of paying a 
private worker as bilaterally agreed upon by both the employer and the 
worker; 
Self-employed worker - refers to any person, whether male or female, who 
is to be engaged, is engaged or has been engaged locally and paid 
directly by the homeownerlemployer to provide services to either a single 
or a number of households on a contractual or day-to-day basis. This 
includes gardeners, laundry women and household helpers hired on a 
day-to-day basis, provided that they do not report for work to a single 
household for four (4) days a week or more, otherwise they shall be 
classified as “kasambahay”; 
Worker - a general term to mean either or both the self-employed or paid 
employee covered under the provisions of this Act; 
Worker of minor age - refers to children from Fifteen (15) to seventeen 
(17) years of age engaged in productive employment under a valid 
contract of employment; and 
Working hours - the period of time within which a worker is required to 
work regardless of whether or not there are actual tasks being undertaken. 
SEC. 4. Framework and Principles. - The government shall encourage the 
organization, establishment, strengthening and expansion of the various business 
activities or enterprises under the IS in the barangay level preferably unified under a 
municipal/city, provincial, regional and national federationlassociation. In this regard it 
shall pursue a policy of minimum regulation towards the IS and it shall encourage the 
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development of ingenuity and the entrepreneurial spirit among the citizenry. The local 
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government units (LGUs) and their respective attached agencies shall, after considering 
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the recommendations that the Department of Trade and Industry (DTI) may provide, 
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simplified procedural rules and requirements in the registration, availrnent of financial 
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grants, incentives, and government assistance, among others. The LGUs shall 
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encourage the private sector to assist in its implementation by participating in 
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government programs for the IS. 
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Chapter 11 
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Coverage, Qualifications and Accreditation 
SEC. 5. Coverage of the IS. -This Act shall cover members of the IS who are 
employed or working either as micro-entrepreneur, paid worker or self-employed as 
defined herein. Provided, however, That the aforesaid micro-entrepreneur, paid worker 
or self-employed qualify under the minimum requirements set forth in this Act. 
For purposes of this Act, the term IS shall cover the following: 
(a) Micro-entrepreneurs: 
(i) 
(ii) 
sidewalk vendors, fish vendors; and 
small scale farmers and fisher folks; 
(b) Employed/Self-Employed: 
(i) 
(ii) 
barbers. manicurists, pedicurists; 
(iii) 
pedicab/tricycle drivers; 
(iv) 
jeepney drivers; 
(v) 
taxi drivers; 
(vi) 
local domestic helpers or “kasarnbahay” 
carpenters, plumbers, electrician, mason, house painters; and 
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(vii) 
welders, mechanics 
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SEC. 6. 
Registration; Payment. - IS business enterprises shall, upon 
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registration, pay Fifty (P50.00) pesos to the municipality or city where it is to be 
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established during the first year of its operation. The fee shall cover the cost for the 
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issuance of the license to operate. 
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Those with net assets before financing amouriting to not more than 
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P25,OOO.OO or monthly income of not 
more 
than P 2,000.00 .... 
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P180.00; 
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(b) 
Those 
with net assets before 
financing 
of 
more 
than P 
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25,000.00 
but 
not exceeding P 100,000.00 or monthly income 
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of P 2,000.00 but not exceeding P 5,000.00 .... P 360.00; 
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(c) 
Those with net assets before financing of mom than P 100,000.00 
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but not exceeding P 400,000.00 or monthly income of more 
than P 
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5,000.00 but not exceeding 
P 10,000.00 .... 
P 720.00; and 
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(d) 
Those 
with 
net assets 
before 
financing of 
more 
than 
P 
SEC. 7. Annual Dues. - IS business enterprises shall pay their annual dues to 
the municipal or city treasurer where they are registered anld accredited, starting on 
their second year of operation, based on the following schedule: 
(a) 
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400,000.00 or monthly income of more than P 10,000.00 .... P 
1,000.00. 
The fees collected shall accrue exclusively to the municipality or city where the 
business is operating and shall be used for IS development programs as approved by 
the municipal or city council. 
SEC. 8. Revocation of Business Authority. - The authority to do business 
shall, after due notice and hearing, be revoked and cancelled upon the failure of the IS 
business activities or enterprises, without valid reasons, to commence its operation 
within forty-five (45) days from receipt of the authority to operate. 
SEC. 9. Accreditation. - Any member of the IS who meets such eligibility, 
qualification and other necessary requirements provided for under this Act, shall be 
accredited as member of the IS. 
Eligibility for accreditation to any development progrsm shall be reviewed, 
revalidated and reassessed every two (2) years from the date of the last accreditation 
by the LEUs where the IS operates. Renewal of eligibility shall be based in accordance 
with the merit and fitness principle. 


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SEC. 
10. 
Eligibility for Benefits. - The selection and appointment of 
beneficiaries under this Act shall be in accordance with the merit and fitness principle: 
Provided, That the applicant is an accredited member of the IS, as prescribed herein. 
I Only accredited member shall be eligible for assistance, support and grants under this 
Act. 
Chapter Ill 
Special Allocations for Development initiatives 
SEC. 11. Informal S6ctor National Livelihood Support. Fund. The national 
government shall allocate at least ten (10%) percent of its annual national budget to be 
appropriated proportionately in accordance with the corresponding Internal Revenue 
Allocation (IRA) of the respective LGUs. Such allocation shall be included in the current 
IRA of LGUs. 
The allocation shall be utilized by the LGUs for the implementation of livelihood 
programs pursuant to the provisions of this Act, Priority shall be given to income 
generating programs for the poorest-of-the-poor. The programs shall focus on micro- 
credit schemes through the mobilization of the members of the IS who have no asset to 
engage in self-employment and income generating activities. 
For this purpose, an Informal Sector Livelihood Support Fund (ISLSF) shall be 
established in every city/municipality and shall be under 
their supervision and 
management subject to accounting and auditing procedures by the Commission on 
Audit (COA). 
SEC. 12. 
Sourcing and Adapting IS Livelihood Support Fund. 
Small 
Business Guarantee and Finance Corporation (SBGFC) created under Republic Act No. 
8289 and the Land Bank of the Philippines, (LBP) shall assist in sourcing and adopting 
of development initiatives for competitive enterprises in terms of finance, technology, 
production, management and business linkages, and provide and promote, develop and 
widen both scope and service, adopt various alternative modes of financing for IS 
.business activities or enterprises, including but not limited to, direct and indirect project 
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lending venture capital, financial leasing, secondary mortgage andl'or rediscounting of 
loan papers to IS business activities or enterprises, and crop producthon financing. 
The SBGFC and the LBP through its National Livelihood Support Fund under EO 
715, as amended, shall guarantee loans obtained by qualified IS worker or business 
activity or enterprise, whether single proprietorship or a partnership venture, under such 
terms and conditions adopted by their respective Boards and shall become liable under 
their guaranty upon proof that the loan has become past due under such terms and 
guidelines adopted by their Boards and printed on the contract of guarantee. 
All provisions stipulated under R.A. 8289 and EO 715 in connection with the 
SBGFC and tho LEP, through its National Livelihood Support Fund shall continue to be 
in effect except those which are amended hereof. 
SEC. 43. Eligibility for Government Assistance. To qualify for assistance, 
incentives and grants, a worker or business activity or enterprise shall comply with the 
following requirements: 
(a) duly registered and accredited with the concerned agency in the LGU where 
they are actively operating and paid the registration and accreditation fees 
at the Office of the Municipal or City Treasurer concerned; 
(b) one hundred percent (100%) owned and capitalized by Filipino citizens, be it 
single proprietorship or a partnership venture; and 
(c) fall under the above-mentioned sub-categories of IS; 
SEC. 14. 
Exclusivity of Government Programs. The government shall 
ensure that programs of financing, grants and other similar incentives shall be extended 
to an accredited IS worker and IS business activity or enterprise. 
6EC.16. Entjtlement of Qovarnment Procurements. The government shall 
adopt a mechanism to ensure that duly accredited IS worker or business activity or 
enterprise shall be entied to a share of at least ten percent (10%) of the total 
procurement value of goods and services supplied to the government, its bureaus, 
offices and agencies annually: Provided, That prices and quality of goods offered by 
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the above-mentioned accredited IS worker or business activity or enterprise are 
competitive. 
SEC. 16. Coordination with LGUs. Pursuant to the provisions of Republic Act 
No. 7160, the local chief executives, in coordination with IS representatives and 
appropriate agencies, shall formulate specific plans that shall address the socio- 
economic needs of the IS and incorporate them in their respective provincial, city and 
municipal development plans. 
SEC. 17. Tax Exemption. A duly accredited IS worker or business activity or 
enterprise shall be exempted from all taxes, national or local, license and building 
permit fees and other business taxes, except real property and capital gains taxes, 
import duties and other taxes on imported articles. In addition, any and all income, 
receipts end proceeds derived from their business operations shall be excluded from 
the computation of the gross income for purposes of computing the individual income 
tax of the members thereof. 
Likewise, it shall 
be exempted from any and all government rules and 
regulations with respect to assets, income, and other activities indispensably and 
directly utilized and related with the IS business or enterprise. 
SEC. 18. Forfeiture of Benefit% All exsmptions and other benefits provided 
herein shall, after due notice and hearing, be forfeited upon violation of the provisions of 
this Act by any IS member or partnership venture. 
SEC. 19. 
Applicability of Benefits. 
The exemptions and other benefits 
provided for in this Act shall apply for a period not exceeding five (5) years from the date 
of the registration, provided that such IS worker or business activity or enterprise is 
registered and accredited within five (5) years from the effectivity of thi8 Act. 
Chapter lV 
Informal Sector Development Boafd 
SEC. 20. Grraatson of an 1s Qevelo~m~n~ 
Board. There is hereby created an 
IS Development Board, hereinafter referred to as the Board, which shall be attached to 
the DTI and shall be constituted within sixty (60) days affer the approwal of this Ad. 
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The Board shall be the primary agency responsible for the promotion, growth and 
development of the IS in the county by facilitating and coordinating national efforts to 
promote the sector's viability and growth, including the provision of an integrated 
program for skills enhancement, literacy and education, health services, social welfare 
and services, assistance in the tapping of local as well as foreign funds, and other 
functions relative to the attainment of the objectives and policy of this Act. 
SEC. 21. Composition. The Board shall be headed by the Secretary of the DTI 
as Chairman, and may elect from among the members a Vice-chairman who, in the 
absence of the Chairman, shall preside over the Board meetings. The Board shall be 
composed of the following: 
(a) Director General of the National Economic and Development Authority 
(NEDA); 
(b) Secretary of the Department of Agriculture (DA); 
(c) Secretary of Department of Labor and Employment (DOLE); 
(d) Secretary of Department of Social Welfare and Development (DSWD); 
(e) Secretary of the Department of Health (DOH); 
(9 Secretary of the Department of Tourism (DOT); 
(9) Administrator of the National Housing Authority ("A); 
(h) Administrator of the Cooperative Development Authority (CDA); 
(i) Chairman of the SBGFC; 
(j) President of the LBP; 
(k) Three (3) representatives From the private sector at large, who must be 
Filipino citizens representing Luzon, Visayas and Mindanao; and 
(I) One (1) representative from the IS to be appointed by tlw President. 
An ex-officio member of the Board who possesses a cabinet-rank shall 
designate an Undersecretary or Assistant Secretary as his/her permanent alternate 
representative in case he/she fails to attend meetings in the exigency of his/her official 
function in the department. 
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The private sector members of the Board shall be entiled to receive per d i m  of 
Two Thousand Pesos (PZ000.00) per meeting. The Board shall meet once a month or 
it may call for special meetings as the need arises: Provided, that the frequency of 
such SpeGial meetings shall not exceed four (4) times annually. 
The DTI shall allocate Ten million pesos (PlO,OOO,OOO.OO) 
out of its savings for 
the initial operating expenses of the Board, after which the Board's budget shall be 
included in the Department's annual appropriation. 
SEC. 22. Mandate of the Board. The Board shall have the following powers 
and functions: 
(a) 
Prepare and establish a System of Accreditation for the IS in accordance 
with the standards and provisions of this Act; 
(b) 
Provide guidelines for the implementation by the LGUs of a fair and credible 
system of evaluation, accreditation, review and assessment, merit promotion, rendering 
of grants and incentive awards and other policies relative to the effective 
implementation of this Act; 
(c) 
Prepare a program of training for human resource development, including 
the specific areas of entrepreneurship and business management; 
(d) Coordinate with LGUs for the development and implementation of periodic 
evaluation of all accredited IS members, taking into account their accomplishments, 
capabilities and potentials which results shall be used as basis for evaluation, 
accreditation, the grant of awatds and incentives, training and retraining; 
(e) Establish B performance appraisal system for all accredited IS members 
which shall be the basis for incentives, rewards and recognition, training and 
development including adequate mechanisms that shall ensure their active participation 
and involvement; and 
(9 Establish the criteria and process for the accreditation and renewal of such 
eligibility for development assistance, support and grants. 
SEC. 23. Authority of the Board to Solicit ~
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from Various 
Agencies. The Board may call upon the participation of any government agency in its 
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deliberations especially when such agency is directly or indirectly concerned with and/or 
affecting the growth and development of the IS in any particular area or manner. 
SEC. 24. Executive Committee. The Board may create an Executive Committee 
of five (6) members elected by the Board from among themselves or their duly 
designated alternate representatives, with at least two (2) members representing the 
private sector, and with authority to act for and in behalf of the Board during intervals of 
meetings, and within the specific authority granted by the Board. 
SEC. 25. 
Board Secretariat. 
The Board, through the Chairman, shall 
designate, in his capacity as Secretary of the DTI, any division or bureau within the DTI 
to act as the Board Secretariat which shall have the following duties and functions: 
To prepare, in coordination with LGUs and other local government 
agencies, and recommend annual a6 well as medium-term IS Enterprise 
Development Plans for the approval of the Board; 
To coordinate the preparation of position papers and background materials 
for discussion or approval during Board meetings; 
To assist the Board in coordinating and monitoring the policies, programs 
and activities of all government agencies with respect to the 
implementation of this Act; 
To prepare, collate, integrate all inputs to the Board's yearly report on the 
status of the IS business activities or @nt@rprises 
in the country; 
To submit periodic reports to the Board on the progress and 
accomplishment of its work programs; and 
To perform ad hoc functions as authorized by the Board. 
SEC, 26. Rationalization of Programs. The Board shell conduct continuing 
review of government programs for IS and shall submit to Congress and the President a 
report thereon together with its policy recommendations with thirty (30) days after the 
opening of every regular session. 
SEC. 27, IS Enterprise Promotion Agency. The President is hereby 
empowered to establish, within ninety (80) days upon the effectivity of this Act, an IS 
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* Enterprise Promotion Agency which shall be the principal government agency to 
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formulate, implement, coordinate and monitor all non-financing government programs, 
including fee-based services, to support and promote entrepreneurial spirit among the 
poorest-of4he-poor. It shall be attached to the DTI and shall be under the policy, 
program and administrative supervision of the Board. The office shall be allocated Ten 
million (PlO,OOO,OOO.OO) pesos for its first year of operation which shall be appropriated 
from the special fund of the Office of the President, and thereafter, its annual 
appropriation shall be included in the Glenera1 Appropriations Act. 
Heads of LGUs in the provincial, city and municipal levels are empowered to 
establish in their respective jurisdiction an IS Division or Bureau, under the office of the 
.Provincial Governor of City/Municipal Mayor, to implement, coordinate and monitor all 
business activities or enterprises and intervene on IS-related problems and concerns 
under their respective jurisdictions. 
Chapter V 
IS Livelihood Resource Center 
SEC. 28. IS Livelihood Resouree Center. The IS Livelihood Resource Center 
shall be established in every city/municipality to enhance access of assistance and 
support to disadvantaged members of society particularly in remote areas. 
For this purpose, the DTI, Technical Education and Skills Development Authority 
(TESQA) and Technology and Livelihood Resource Center (TLRC) shall develop 
livelihood programs which shall harness the skills of the IS members. 
The aforesaid agencies shall conduct human resource development programs 
and management in the following areas: 
(a) 
(b) 
Adequate facilities and resources to render quality social service; 
Opportunities for IS workers to grow and develop their potentials and 
experience a sense of worth and dignity in their work; 
Mechanisms for democratic consultations; 
Upgrading of working conditions; and 
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(e) 
Allocation of funds for the participation of IS workers in skills training 
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and workshops 
continuing advancement. 
and other similar activities as part of their 
8EC. 211. 
Functions of IS Livelihood Resource Canter. The IS Livelihood 
Resource Center shall have the following functions: 
(a) Conduct training programs which shall provide new ideas to IS members 
and upgrade the technical and entrepreneurial skills of those are already in 
the field; 
(b) Implement consciousness-raising capability building and leadership training; 
(c) Provide technical support and access credit to the IS members engaged in 
micro-entrepreneurship and cottage industries or other productive work; 
(d) Monitor the performance of the IS in the area; 
(e) Give advise and recommendations as to the strengthening and expansion of 
the IS activities; and 
(f) Provide services, to include but not limited to counseling, legal assistance, 
credit assistance, and other services necessary for the furtherance of this 
Act. 
The LGWs shall allocate at least Two Hundred Thousand Pesos (P200,000.00) 
annually for the operation and maintenance of the Center. The local chief executives 
shall act as the primary overseers of the overall operation of the Center. 
Chapter VI 
IS Comprehensive and Integrated Plan and Inter-Agency Nemorking 
SEC. 30. 
IS Livelihood Resource Center. The NEDA shall be tasked to 
formulate a Ten-Year Comprehensive and Integrated Plan on the impact of globalization 
for the IS. It shall determine and recommend the necessary safety nets needed by the 
IS to prepare them for the possible effects Of globalization. 
SEC. 31. Inter-Agency Networking. The DOLE shall provide for and lead the 
inter-agency networking system among the different departments and instrumentalities 
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of government, should the same be required in the continuing efforts to protect the 
interests, rights and privileges of IS workers. 
The Board, in coordination with the Department of Education (DepEd) and the 
Commission on Higher Education (CHED), shall design a comprehensive and 
' integrated program for IS members to give them opportunity to pursue free education, 
The cooperatives, through the assistance of the DTI, TESDA and TLRC, shall 
inform IS members in the rural areas of opportunities for market and technology, access 
and the availability of livelihood trainings and seminars to respond to IS needs and 
potentials. 
The DSWD shall, within a period of one (1) year from the date of effectivity of this 
Act, institute a program designed specifically to provide emergency services specifically 
to women and minor IS workers who am in need of custody, shelter, healing, or 
medical, psychological, legal and rehabilitative services. 
The DSWD shall, upon the recommendation of the DOLE, effect the repatriation 
of minor IS workers who either voluntarily seek government protection against abuse 
and exploitation or upon report or discovery of the same. The costs of such repatriation 
shall be borne by the DSWD. The DOLE shall formulate the rules and regulations 
governing the emergency repatriation of the same. 
For this purpose, a Repatriation Fund is hereby created and established under 
the administration and control of the DSWD in the amount of Ten million pesos 
(PlO,OOO,OOO.OO) to be taken from the President's Social Fund. 
Chapter VII 
Rights and Privileges of IS 
SE6. 32. Basic Rights. All members of the IS shall have the following rights 
and privileges: 
(a) Participate in all spheres of society including the decision-making processes 
to fully realize their role as agents and beneficiaries of people-centered 
development; 
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(b) Equal protection befora the law; 
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(c) Humane safe and healthful living conditions in the workplace; 
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(d) Equal access to education, skills training, and economic resources to 
develop their self-reliance; 
(e) 
Information on matters of concern affecting the welfare and interesb of their 
sector; and 
Protection from any form of discrimination, violence, sexual exploitation and 
abuse. 
(9 
%EC. 33. Right to Medical Care and Humane Treatment. Every worker has a 
right to quality health care, without any discrimination and within the limits of the 
re$ources available for health and mediaal care. In the course of such care, his human 
dignity, culture, convictions and integrity shall be respected. 
The employer or any member of the household or institution shall, at all times, 
treat his/her worker in a just and humane manner. In no instance shall abusive 
language, physical violence or any act which debases, degrades or demeans the 
intrinsic worth and dignity of the worker as a human being be used upon the latter. 
SEC. 34. Right ts Organize. The State recognizes the right of IS workers to 
organize themselves to promote their welfare and advance or safeguard their interests. 
Towards this end, the government shall assist the IS esp@cialy in the rural areas in 
establishing self-help organizations. 
Membm of the IS engaged in agricultural, manufacturing and senrice sector are 
encouraged to form women’s cooperatives in every citylmunicipality to enable members 
to avail of credit assistance and skills training which will help improve their quality of life. 
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Benefits and Incentives 
§EC. 35. 
Medicalltlealth Insuranae. 
A worker, regardless of age and 
compensation level, shall be covered by a free medicallhealth insurance under the 
Philippine Health lnlauran~e Corporation (PWILHEALTH), and shall be entitled to all the 
benefits provided for under the law: Provided, however, That the worker has rendered 
at laast one (I) 
year of continuous service to have a medicaVhealth insuranw during 
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initial months of hidher employment. Helshe shall shoulder all the necessary premiums 
due him/her until the seventh (7Ih) month when the employer shares fifty (50%) percent 
of the monthly required premiums. 
For purposes of this Section, the PHILHEALTH shall, within ninety (90) days from 
the effectivity of this Act, promulgate guidelines for the mechanism of collecting the 
aforesaid contributions especially contract workers who are employed on daily, monthly 
or “pakyaw” basis. PHILHEALTH is hereby mandated to implement an outreach 
program that shall facilitate the remittence of premiums by either the employer or the 
worker by whatever means deemed feasible. 
Pending the promulgation of pertinent implementing rules and regulations to this 
effect, the employee shall receive the employers’ share or counterpart contribution and 
may remit said amount together with his/her own share to the SSS. 
SEC. 36. 
Social Security Coverage. 
A worker, regardless of age and 
compensation levels, shall be cowered by social security and be entitled to all the 
benefits provided for under Republic Act No. 8282: Provided, however, That the 
worker has rendered at least one (1) year of continuous service: Provided, further, That 
if the worker intends to become a member of the SSS or intends to continue hislher 
social security contribution during the initial months of hidher employment, heishe shall 
shoulder all the necessary premiums due himlher until the seventh (7th) month when the 
employer shares flfty (50%) percent of the monthly required contribution. 
For purposes of this Section, the SSS shall, within ninety (90) days from the 
effectivity of this Act, promulgate guidelines for the mechanism of collecting the 
aforesaid premiums especially for those contracted workers who are employed on daily, 
monthly or “pakyaw” basis. The SSS is hereby mandated to implement an outreach 
.program that will facilitate the remittance of premiums by either the employer or the 
worker by whatever means deemed feasible. 
Pending the promulgation of pertinent implementing rules and regulations to this 
effect, the employee shall receive the employers’ share or counterpart contribution and 
may remit said amount together with hitdher Own share to the SSS. 
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Chapter IX 
Organizational Structure 
SEC. 37. Consultations with IS Organizations. The IS Development Board 
(ISDC), in coordination with other concerned agencies and the LGUs, shall conduct 
annual national, regional and provincial consultations among the IS organizations to 
determine the specific issues and problems affecting their sector. The Board shall 
channel IS concerns to the appropriate agencies and provide the necessary 
recommendations to the executive and legislative departments. 
SEC. 38. Establishment of IS Database. The Board shall establish and 
develop a centralized database system to effectively adopt policy formulation and policy 
concerns relative to the IS. The databank shall include but not limited to the following: 
a) 
List of government and non-governmental organizations which 
provide educational, socio-economic and legal services to the IS; 
Inventory of pending cases involving the IS activities; 
Statistical profile of the various IS classified according to activities, 
involvement and other statistical information; 
Database of the needs and problems of women and children in the 
IS nationwide; and 
b) 
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e) 
Compilation of existing laws and programs affecting the interest 
and welfare of the IS. 
The public shall be allowed to have access to the said data provided that they 
shall abide with the regulations that will be set by the inter-agency committee. 
Chapter X 
Benefits to Participating Private Sector 
SEC, 39. 
Incentive@ to Private Sector. 
The national government shall 
implement a mechanism which shall give incentives and benefits to private Sector 
organizations participating in a national effort to advance the interests and welfare of the 
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The Department of Finance, in coordination with the Bureau of Internal Revenue, 
shall promulgate guidelines for the effective implementation of this Section. 
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TITLE It 
IS WORKERS ENTERING INTQ CONTRACTED E 
Chapter I 
Requisites for Contracting Employment 
SEC. 40. Employment Contract. All working arrangements entered into by IS 
workers shall be covered by a written employment contract, in a language or dialect 
understood by both employer and worker, duly signed by them. Undw this Act, the 
employer and the worker may enter into either one of the following three (3) working 
arrangements: Daily Basis, Monthly Basis, or “Pakyaw” Basis. 
The contracting parties shall be provided with a full set of the duly signed 
employment contract, the basic provisions of which shall include the following: 
(a) working arrangemenffmode; 
(b) pariodlduration of employment; 
(c) compensation and mode of payment; 
(d) computation of contributions for social security and medical insurance; 
(e) computation of leave deductions; 
(9 duties and responsibilities; 
(9) working hours and day-off schedule; and 
(h) living quarters or sleeping arrangements (for live-in workers) 
SEC. 41. Medical Certificate as Pre-requisite for Employment A medical 
certificate attesting to ths physical and mental fitness of an applicant for work must be 
secured from a licensed physician as a pre-requisite for employment, the cost of which 
shall be paid by the employer. 
Chapter II 
IS Workers of Minor Age 
SEC. 42. Allowable Employment of Workers af ~ i n ~ r  
Age. Children below 
sixteen (16) years of age may be employed: Provided, That a parental consent be 


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presented and attested by any representative from the LGU or duly elected barangay 
official where the minor is employed: Provided, further, That the provisions of the 
United Nations (UN) Convention on the Worst Forms of Child Labor be taken into 
consideration in the course of employing such minors. 
In no instance, however, shall children below fifteen (15) years of age be 
engaged in whatever form of productive service. 
Unless expressly employed as “kasambahay” with duly executed contract of 
employment, children who live with their parents at the employer’s residence or those 
whose sustenance or education is being provided for by the homeowner, shall not be 
considered as “kasembahay“. 
Workers of minor age shall not be allowed to render work for more than ten (IO) 
hours a day, five (5) days per week, exclusive of one (I) 
hour break each for breakfast. 
lunch and dinner. 
SEC. 43. Custody over Minors. Should a worker of minor age refuses to be 
repatriated upon the recommendation of the DSWD, said individual may be placed 
under the custody and care of the DSWD or that of a duly recognized and acoredited 
’ non-government organization, or placed in a suitable employment. 
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Standardized Wage Rate 
SEC. 44. Standardized Wage Kate. Pursuant to the provisions of this Act, a 
~tandardized wage rate is hereby set forth: 
For Kasambahay 
(a) 4th - 6’h class municipalities - 
Below P1,000.00 
(b) 1‘ - 3rd class municipalities & - 
P 1,001 .oo - P 1,800.00 
Chartered & Component Cities 
(c) National Capital Region 
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P 4,801 .OO - P 2,500.00 
For Employed Worker 
(a) 4’” - 6th class municipalities - 
SkillBd: 
P 90.00 - P 120.00 
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Unskilled: 
P 60.00 - P 80.00 
(b) 1“- 3‘ class municipalities - 
Skilled: 
P 130.00 - P 180.00 
Unskilled: 
P 90.00 - P 120.00 
(e) National Capital Region 
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Skilled: 
P 230.00 - P 260.00 
Unskilled: 
P 190.00 - P 220.00 
Provided, That a worker who has contracted work in other city/municipality other 
than the place of residence shall be entitled to the daily wage rate of the 
citylmunicipality where he/she actually works: Provided, further, That a worker who has 
contracted employment outside the city/municipality of residency shall be afforded free 
assistance and support in the form of housing and food by the contractor/employer. 
In the case of worker who works on monthly or “pakyaw” basis, the wage rate to 
be applied shall be based in the wage rate of the city/municipality where he/she actually 
works. He/she shall also be afforded free housing and support for the duration of the 
contract. 
In no instance, however, shall workers of minor age be deprived of the above 
standardized wage rate? system set forth in this Act. 
SEC. 45. Payment of Wages. Payment of wages shall be made directly to the 
worker, at least once every two (2) weeks or twice a month. No deductions from said 
wages shall be made by the employer except those provided for by law. The expressed 
written consent of tho worker shall first be secured before any deduction is made. 
Chapter IV 
Prohibited Acts 
SEC. 46. Prohibition Against; ~ i ~ h t  
Work. Worker of minor age shall not be 
allowed to render work between ten o’clock in the evening and six o’clock in the 
morning the following day. 
SEC. 47. Prohibition Against Work to be Undertaken. Worker of minor age 
shall not be allowed to render work beyond their mental and physical capabilities. 
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SEC. 48. Prohibition Against Bonded Labor. A worker shall not be allowed to 
use hislher future services as collateral for any loan or advances made or to be made 
by said worker with the employer. Likewise, no employer shall be allowed to bind the 
worker to have hislher continued employ as a form of payment for any loan or advances 
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which helshe may have made with the employer. Should there be an outstanding loan 
incurred and helshe decides to unilaterally terminate the contract of employment, said 
loan or advance shall be paid by himlher to the employer under terms and conditions 
specified in a duly executed promissory note between parties. 
SEC. 49. Prohibition Against Labor Sub-Contracting. In no instance shall 
fh63 employer sub-contract the service8 of a worker to any third party, unless such 
activity falls within the purview of an employment arrangement for which the necessary 
permits and licenses had been prewiously secured. 
SEC. 50. Prohibition Against Recruitment and Finders Fees. Regardless of 
whether the worker was recruited either through an employment agency or a third party, 
said worker shall neither be charged nor levied a share in the recruitment fees or 
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minor age shall not be employed in any hazardous work, activity OF undertaking, and 
finder’aa fees; by the aforementioned employment agency or third party. 
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neither shall helshe be exposed to hazardous working conditions. 
For purposes of this Section, hazardous work or conditions shall include, but not 
limited to the following: 
(a) 
any work, employment or activity which exposes the worker to 
physical, emotional or sexual abuse; 
any work which involves manual handling or transport of heavy loads; 
any work in an unhealthy environment which exposes household 
helpers to hazardous substances, agenb or processes, or to 
temperatures, noise levels, or vibrations affecting their health; 
any work which requires the household helper to render services for 
long periods of time or late in the evening; 
(b) 
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any or all forms of slavery or practices similar to slavery, such as the 
sale and trafficking of household helpers, forced or compulsory labor, 
debt bondage and serfdom; 
any use, procuring or offering of the household helper for prostitution 
or pornography; 
any use, procuring or offering of the household helper for the 
commission of any offense or crime, particularly for the production and 
trafficking of narcotic drugs and substances as defined in the 
Dangerous Drugs Act; 
any other type of work or activity which, by its nature or the 
circumstances in which it is carried out, is likely to jeopardize the 
health, safety or morals of the household helper; and 
any other type of work, activity, condition or undertaking that may be 
hereinafter defined as hazardous by the DOLE. 
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SEC. 52. 
Prohibition Against Interference and Coercion. Any person is 
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prohibited from committing any of the following acts of interference and coercion; 
To prevent a worker from upholding his/her other basic rights; 
To prevent workers from joining or assisting organizations or unions for 
purposes not contrary to law, in order to defend and protect their mutual 
interest and to obtain redress of grievances through peaceful concerted 
efforts; 
To prevent a worker from carrying out hidher duties and functions in an 
organization or union, or to penalize the same for nay lawful action 
performed in that capacity; 
To make calculated harassment and interference with the intention of 
intimidating or preventing the social worker from performing his/her duties 
and functions; 
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(e) 
To make calculated harassment against, or to transfer, penalize or 
terminate the services of a worker who is carrying out hisher function or 
role for and in behalf of hislher employer; and 
To perform acts calculated to diminish the independence and freedom of a 
social worker's union or organization to direct its own affairs. 
Chapter V 
Rights and Benefits of Employed IS Workers 
(9 
SEC. 53. Right to Wages Earned. The employer shall pay directly to the 
worker of minor age, any and all wages, remuneration or compensation earned by 
himlher during the period of employment. 
No parent, guardian or relative shall be allowed to borrow against the 
compensation of the hislher relative-worker of minor age without the express written 
consent of the latter. Neither shall the worker of minor age be mandated to work in 
payment of a loan or liability incurred by a parent, guardian or relative. 
SEC. 54, Right to PriVaGy and ~ o n ~ d ~ n t i a i i ~ .  
The employer shall respect the 
privacy of hislher worker during the course of the latter's rest periods. This right lo 
privacy shall extend to any and all forms of personal communications, including letters 
of correspondence issued or received, and be allowed communications coursed through 
the private telephone of the employer: Provided, That any additional expense incurred 
in the course of the communication shall be borne by the worker and shall be deducted, 
upon the employer's due notice to the worker of the amount incurred, from the 
receivable wage of the worker. 
The worker shall be allowed to exercise hislher right to communicate with 
relatives and other persons and to receive visitors subject to reasonable limits 
prescribed in the employment contract agreed and entered into by both the employer 
and the worker. 
SEC. 55. Access to Education and Training. A worker shall not be deprived 
of formal or non-formal education. In cases where he/she is productively employed, 


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he/she shall be allowed to attend or pursue literacy program during day-off or in any 
other time with the consent of the employer. 
The Department of Education (Deped) or Commission on Higher Education 
(CHED), whichever office is applicable, shall extend its services of Study-Now, Pay- 
Later Program to the workers in the IS. 
The employer may also extend scholarship to a worker and shall be reimbursed 
through deductions from the worker's monthly compensation which shall, at all times, 
not more than fifty (50%) percent of the worker's monthly compensation. The time 
spent by a worker in the course of hidher schooling, or training, including the time spent 
going to and coming from the training shall be counted as part of the worker's hours of 
work. 
SEC. 56. 
AGcess to Lawful Third-party Mediation. The employer shall 
provide all workers the names, addresses and telephone numbers of the following 
designated liaison offices: 
(a) DTI; 
(b) DOLE; 
(c) The Barangay office where helshe is working; and 
(d) Duly registered non-government organizations accredited to mediate 
disputes in their sector. 
The employer shall further guarantee 
worker's access to all means of 
communication for the purpose of contacting any of the above-enumerated institutions. 
SEC. 57. Provision of Baaia Necessities. The employer shall provide the 
following basic necessities of a live-in worker: 
(a) A minimum of three (3) full meals per day; 
(b) Humane, private and safe sleeping quarter; 
(c) Emergency medical support and assistance; 
(d) A safe and non-health hazard workplace; 
In no instance shall the employer be allowed to withdraw or hold in abeyance 
these basic necessities as punishment or disciplinary action on the worker. 


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SEC. 58. 
Normal Hours of Work. 
Cognizant of the peculiarities of the 
relationship between the employer and the IS worker, the normal hours of work shall be 
set at ten (IO) hours per day, exclusive of one (1) hour breaks each for breakfast, lunch 
and dinner. The worker shall be allowed at least eight (8) hours of continuous rest per 
day otherwise any work done beyond said period of time shall be duly compensated. 
SEC. 59. Regular Warking Days. No worker shall render work for more than 
six (6) days per week. While the specific day of the week set aside as rest day for the 
worker may be stipulated in the employment contract, the same may be changed for 
another day of the week upon the mutual agreement of the employer and the worker as 
the exigencies of the work may dictate. 
SEC. 60. Longevity Pay. A longevity pay equivalent to five per centum (5%) of 
hislher latest monthly basic pay shall be paid to a worker for every two (2) years of 
continuous and satisfactory service rendered. 
SEC. 61. Clothing Allowance. A worker shall be entitled to a minimum of One 
Thousand pesos (PI ,000.00) clothing allowance annually: Provided, That the worker 
has rendered at least one (1) year of continuous service in the employment helshe is 
currently in. 
SEC. 62. Vacation Leaves. A worker employed for one (I) 
year shall be 
entitled to a fourteen (14) day vacation leave with pay, in addition to the one (1) day per 
week designated as the rest day, Said leave may only commence at the end of the first 
year of employment, and shall not cumulate from year to year. 
SEC. 63. Maternity Benefits. A female worker who is employed for one (1) 
year shall be entitled to maternity benefits. 
SEC, 814, 
Month Pay. A worker shall be entitled to a 13th month pay 
equivalent to one (I) 
month's basic salary which shall be paid to the worker not later 
of December of every year: Provided, however, That the worker has 
reached the required minimum residency. Otherwise, the worker shall be entitled to 
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receive a 
Month Pay on pro-rated basis. 
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SEC.65. 
Allowing Subcontracting. A worker ma)‘ enter into subcontractual 
employment or may accept subcontractual jobs from any othebr enterprise or firm or may 
join productive employment through a cooperative or consortium: Provided, however, 
That the enterprise, firm, cooperative or consortium shall be mandated to implement the 
specific provisions of this Act with respect to worker’s benefits: Provided, further, That 
where a worker subcontracts jobs between and among other workers, the paw who 
contracted the job shall not be obligated to provide for the benefits due himlher. 
SEC. 66. Pre-Termination of Contract. The employer may, at his/her own 
discretion, terminate the services of the worker: 
Provided, however, That the said 
employer provides the worker with at least fifteen (15) day notice of termination and 
termination pay equivalent to at least one half (1/2) month’s salary. In lieu of the fifteen 
(15) day notice of termination, the employer may immediately terminate the services of 
the worker: Provided, That said employer provides the worker termination pay 
equivalent to one (1) month’s salary. 
The employer may, for valid or just cause of loss of confidence, terminate the 
services of the worker prior to the expiration of the contract without indemnifying the 
latter with termination pay. 
Should the worker decide, on hidher own volition, to unilaterally leave the 
workplace prior to the expiration of the contract period, said worker shall forfeit any 
separation p@y that may be due himlher. 
SEC. 67. Extent of Duty. The employer shall not require a worker to perform 
any task or work outside the assigned workplace for the service or benefit of another 
’ without the latter’s consent and payment of just compensation. 
SEC. 68. Automatic Salary Increase. The contract of employment executed by 
and between the employer and the worker shall provide for an annual salary increase, 
the amount of which shall be determined by mutual agreement of the parties. 
SEC. 69. Deployment Expenses. Deployment expenses of a worker, including 
transportation and agency fees, shall be shouldered by the employer. 
TITLE 111 
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FINAL ~ ~ O V I ~ I O N ! §  
SEC. 70. Penal Provision. Any person who shiall willfully interfere with, restrain 
or coerce a social worker in the exercise of hidher rights or shall in any manner commit 
any act in violation of any of the provisions of this Act shall, upon conviction, be 
punished by a fine of not less than Ten thousand pesos (Pl0,OOO.OO) but not more than 
Twenty thousand pesos (P20,OOO.OO) or imprisonment of one (1) year to six (6) years or 
both fine and imprisonment at the discretion of the court. 
If the offender is a public official, the court in addition to the penalties provided in 
the preceding paragraph, may impose the additional penalty of disqualification from 
public office. 
Any private institution/company found to be violating any provision of this Act, 
shall be subject to a penalty ranging from suspension to revocation of license, at the 
discretion of the court. 
SEC. 71. 
Separability Clause. 
If any provision of this Act is declared 
unconstitutional or invalid, the provisions not affected shall continue to be in full force 
and effect. 
SEC. 72. Repealing Clause. All laws, decrees, orders, rules and regulations or 
other issuances inconsistent with the provisions of this Act are hereby repealed, 
amended or modified accordingly. 
SEC. 73 
Effectivity. This Act shall take effect fifteen (15) days after its 
publication in at least two (2) newspapers of general circulation or the Official Gazette, 
whichever comes first. 
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Approved. 
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