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TWENTIETH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
)
)
SENATE 
5. No. 941
25 AUG-5 P4--04
0 ,:r.-
Introduced by Senator 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
EXPLANATORY NOTE
Section 9 of Republic Act No. 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.
The low rate of compliance with existing wage orders may be partly 
attributable to the lack of labor inspectors. Apart from this, 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.
DOLE continues its endeavor to address this concern. Under its Labor 
Inspection Program as of May 12, 2022, a total of 325,081 establishments were 
inspected covering 13.273 million workers.1 DOLE also deputizes volunteer labor
Labor Inspection Program - SDGs - Philippines


inspectors from labor, management and professional organization sectors to inspect 
establishments in regions with large concentration of industries.
In December 2021, there are around 1,200 labor inspectors and the DOLE 
admitted that they need at least 2,000 additional labor inspectors to bring the figure 
close to the ideal 5,000 labor inspectors. In 2024, the number of labor inspectors 
remain at 1,200.2
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.
This measure will also be instrumental in implementing the commitment of 
the country embodied in International Labour Convention No. 081 or the Labour 
Inspection Convention, 1947 which the Philippines ratified November 5, 2024.3
Hence, the urgent passage of this bill is fervently requested.
NGGpY EJERCITO ESTRADA
2 Collaboration, digitization efforts highlight 2024 labor Inspection Summit I Department of Labor and
Employment
3 Convention C081 - Labour Inspection Convention. 1947 (No. 81)


TWENTIETH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
)
)
SENATE
S. No. 941
o( me ■•••*.>
25 AU6-5 P4 -04
RECEIVED 3\
Introduced by Senator 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 it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled:
1 
Section 1. Section 9 of Repubiic Act No. 7627, otherwise known as the Wage
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Rationaiization Act, is hereby amended to read as follows:
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"Sec. 9. The Department of Labor and Employment
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shall conduct inspections as often as possible within its
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manpower constraint of the payroll and other financial
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records kept by the company or business to determine
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whether the workers are paid the prescribed wage rates and
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other benefits granted by law or any Wage Order. In
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unionized companies, the Department of Labor and
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Employment inspectors shall always be accompanied by the
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president or any responsible officer of the recognized
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bargaining unit of any interested union in the conduct of the
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inspection. In non-unionized companies, establishments or
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businesses, the inspection shall be carried out in the
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presence of a worker representing the workers in the said
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company. The workers' representative shall have the right to
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submit his own findings to the Department of Labor and
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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 NATIONAL TAX 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


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THE CRITERIA TO BE PRESCRIBED BY THE
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SECRETARY OF LABOR AND EMPLOYMENT.
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"ANY LABOR INSPECTOR SEPARATED FROM
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THE SERVICE AS A RESULT OF THE ABOLITION OF
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POSITION PURSUANT TO THIS ACT SHALL BE
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ENTITLED TO APPROPRIATE SEPARATION PAY AND
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RETIREMENT AND OTHER BENEFITS ACCRUING TO
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THEM UNDER EXISTING LAWS. IN LIEU THEREOF, AT
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THE OPTION OF THE EMPLOYEE, HE SHALL BE
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PREFERENTIALLY CONSIDERED FOR EMPLOYMENT
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IN THE GOVERNMENT OR IN ANY OF ITS
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SUBDIVISIONS, 
INSTRUMENTALITIES, OR
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AGENCIES, INCLUDING GOVERNMENT-OWNED OR
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CONTROLLED CORPORATIONS AND THEIR
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SUBSIDIARIES."
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Sec. 2. Separability Clause. - If any provision or part hereof is held invalid or
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unconstitutional, the remainder of the law or the provision or part not otherwise
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affected shall remain valid and subsisting.
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Sec. 3. Repealing Clause. - Any law, presidential decree or issuance,
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executive order, letter of instruction, administrative order, rule, or regulation
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contrary to or inconsistent with the provisions of this Act are hereby repealed,
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modified, or amended accordingly.
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Sec. 4. Effectivity. - This Act shall take effect fifteen (15) days after its
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publication in the Official Gazette or in a newspaper of general circulation.
Approved,