Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

Sixteenth Congress
Second Regular Session

5A7L

HOUSE BILL NO.

INTRODUCED BY: REP. KARLO ALEXEI B. NOGRALES, REP. EMMELINE Y.
AGLIPAY VILLAR, REP. FLORENCIO T. FLORES, JR.
AND REP. DEOGRACIAS B. RAMOS, JR.

EXPLANATORY NOTE

The 1987 Philippine Constitution promotes the principle of shared responsibilty
between workers and employers and the preferential use of voluntary modes in settling
disputes, including conciliation, and shall enforce their mutual compliance therewith to foster
industrial peace, The Constitution also guarantees the rights of all workers to self-
organization, collective bargaining and negotiations, and peaceful concerted activities,
including the right to strike in accordance with law.

Articles 263, 264 and 272 of the 1974 Labor Code of the Philippines, as amended,
having been crafted under the Martial Law era, have to be aligned with the mandates of the
1987 Constitution to foster industrial peace based on social justice

Particularly, paragraph (g) of Article 263 empowers the Secretary of Labor and
Employment to assume jurisdiction over a labor dispute causing or likely to cause a strike or
lockout, that on his/her opinion, is an “industry indispensable to national interest.” This
provides the Secretary of Labor and Employment a very wide latitude of discretion in the
exercise of assumption power to include labor disputes in an undergarment factory, match
manufacturing, hotdog, and fish sauce factory as industries indispensable to the national
interest

Under this, the State restrains the exercise of the right to strike or lockout with a
directive to workers to return to work and the management to accept the striking workers
under the same terms and conditions. Article 264 declares as a prohibited act non-
compliance with the procedural requirement and defiance of Return to Work Order. Too
often, the exercise of assumption power has not resulted to peaceful settlement of labor
disputes. Instead, it has triggered dismissal of workers as penalty imposed under Article 272,
picket line violence and violation of trade union rights, filing of criminal cases or company
closures. This is borne by the cases of trade union rights violations against the Philippine
government before the International Labour Organization (ILO) and the US Trade
Representatives.


Thus, the bill seeks to amend Article 263, 264 and 272 of the Labor Code to
rationalize government interventions in labor disputes by adopting the essential services
criteria in the exercise of the assumption or certification power of the Secretary of Labor and
Employment, providing conditions in its exercise and to decriminalize violations thereof.

In view of the foregoing, the passage of this bill is earnestly sought.

KARL ALEXEI B. NOGRALES
Representative
4° District, Davao City

Antan i. Kober
EMMELINE Y. AGLIPAY VILLAR
Representative
Party List - DIWA

“AMOS, JR.
Representative
2” District, Sorsogon



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

Sixteenth Congress
Second Regular Session

5471

HOUSE BILL NO.

INTRODUCED BY: REP. KARLO ALEXEI B. NOGRALES, REP. EMMELINE Y,
AGLIPAY VILLAR, REP. FLORENCIO T. FLORES, JR.
AND REP. DEOGRACIAS B. RAMOS, JR,

AN ACT RATIONALIZING GOVERNMENT INTERVENTIONS IN LABOR
DISPUTES BY ADOPTING THE ESSENTIAL SERVICES CRITERIA IN THE
EXERCISE OF THE ASSUMPTION OR CERTIFICATION POWER OF THE
SECRETARY OF LABOR AND EMPLOYMENT, AND DECRIMINALIZING
VIOLATIONS THEREOF, AMENDING FOR THIS PURPOSE ARTICLES 263, 264
and 272 OF PRESIDENTIAL DECREE 442, OTHERWISE KNOWN AS THE
LABOR CODE OF THE PHILIPPINES, AS AMENDED AND FOR OTHER
PURPOSES

Be it enacted by the Senate and House of Representatives of the Philippines in
Congress assembled:

Section 1, Article 263 of the Labor Code is hereby amended to read as follows:
“Article 263. Strikes, picketing and lockouts. —

a) It is the policy of the State to encourage free trade unionism and free
collecting bargaining

=

Workers shall have the right to engage in concerted activities for purposes of
collective bargaining or for their mutual benefit and protection. The right of
legitimate labor organizations to strike and picket and of employers to lockout
[,-consistent-with_the-national-interest,] shall continue to be recognized and
respected. However, no labor union may strike and no employer may declare
a lockout on grounds involving inter-union and intra-union disputes.

2

In case of bargaining deadlocks, the duly certified or recognized bargaining
agent may file a notice of strike or the employer may file a notice of lockout


d

9)

with the [Ministry] DEPARTMENT OF LABOR AND EMPLOYMENT at least
30 days before the intended date thereof. In cases of unfair labor practice, the
period of notice shall be 15 days and in the absence of a duly certified or
recognized bargaining agent, the notice of strike may be filed by any
legitimate labor organization in behalf of its members. However, in case of
dismissal from employment of union officers duly elected in accordance with
the union constitution and by-laws, which may constitute union busting where
the existence of the union is threatened, the 15 day cooling-off period shall
not apply and the union may take action immediately.

The notice must be in accordance with such implementing rules and
regulations as the [Minister] SECRETARY of Labor and Employment may
promulgate.

During the cooling-off period, it shall be the duty of the [Ministry]
DEPARTMENT OF LABOR AND EMPLOYMENT to exert all efforts at the
mediation and conciliation to effect a voluntary settlement. Should the dispute
remain unsettled until the lapse of the requisite number of days from the
mandatory filing of notice, the labor union may strike or the employer may
declare a lockout.

A decision to declare a strike must be approved by a majority of the total
union membership in the bargaining unit concerned, obtained by secret ballot
in meetings or referenda called for that purpose. A decision to declare a
lockout must be approved by a majority of the board of directors of the
corporation or association or of the partners in a partnership obtained by
secret ballot in a meeting called for that purpose. The decision shalll be valid
for the duration of the dispute based on substantially the same grounds
considered when the strike or lockout vote was taken, The [Ministry]
DEPARTMENT OF LABOR AND EMPLOYMENT (DOLE) may on its own
initiative or upon the request of any affected party, supervise the conduct of
the secret balloting. In every case, the union or the employer shall furnish the
[Ministry] DOLE the results of the voting at least seven days before the
intended strike or lockout, subject to the cooling-off period herein provided.

When [in-his-opinion] there exists a labor dispute causing or likely to cause
strike or lockout in an industry [indispensable—to—the—national—interest,]
ENGAGED IN ESSENTIAL SERVICES, THE SECRETARY OF LABOR AND
EMPLOYMENT MAY ASSUME JURISDICTION OVER THE DISPUTE
PROVIDED, THAT ANY OF THE FOLLOWING CONDITIONS IS PRESENT:

1. BOTH PARTIES HAVE REQUESTED THE SECRETARY OF LABOR
AND EMPLOYMENT TO ASSUME JURISDICTION OVER THE
LABOR DISPUTE; OR

2. UPON REQUEST OR PETITION BY EITHER PARTIES, OR MOTU
PROPIO ON THE PART OF THE SECRETARY OF LABOR AND
EMPLOYMENT AFTER A CONFERENCE CALLED BY THE OFFICE
OF THE SECRETARY ON THE PROPRIETY OF ITS ISSUANCE HAS
BEEN CONDUCTED.


h

IN SUCH CASE, THE SECRETARY OF LABOR AND EMPLOYMENT MAY
DECIDE OR CERTIFY THE LABOR DISPUTE TO THE NATIONAL LABOR
RELATIONS COMMISSION FOR COMPULSORY ARBITRATION, OR TO A
VOLUNTARY ARBITRATOR OR PANEL OF VOLUNTARY ARBITRATORS.

SAID ASSUMPTION SHALL HAVE THE EFFECT OF AUTOMATICALLY
ENJOINING AN IMPENDING STRIKE OR LOCKOUT. IF A
STRIKE/LOCKOUT HAS ALREADY TAKEN PLACE AT THE TIME OF
ASSUMPTION, ALL STRIKING OR LOCKED OUT EMPLOYEES AND
OTHER EMPLOYEES SUBJECT OF THE NOTICE OF STRIKE OR
LOCKOUT SHALL IMMEDIATELY RETURN TO WORK AND THE
EMPLOYER SHALL IMMEDIATELY RESUME OPERATIONS AND
READMIT ALL EMPLOYEES UNDER THE SAME TERMS AND
CONDITIONS PREVAILING BEFORE THE STRIKE OR LOCKOUT,

ESSENTIAL SERVICES REFER TO FUNCTIONS OR SERVICES
RENDERED BY AN ESTABLISHMENT, WHICH IF INTERRUPTED, WOULD
ENDANGER THE LIFE, PERSONAL SAFETY OR HEALTH OF THE WHOLE
OR PART OF THE POPULATION. FOR THIS PURPOSE, THE SECRETARY
OF LABOR AND EMPLOYMENT, BY APPROPRIATE REGULATIONS,
SHALL DETERMINE THE INDUSTRIES ENGAGED IN ESSENTIAL
SERVICES AFTER CONSULTATIONS WITH THE NATIONAL TRIPARTITE
INDUSTRIAL PEACE COUNCIL.

IN LABOR DISPUTES AFFECTING INDUSTRIES ENGAGED IN
ESSENTIAL SERVICES, IT SHALL BE THE DUTY OF THE UNION AND
EMPLOYER TO PROVIDE AND MAINTAIN THE OPERATION OR
DELIVERY OF SERVICES. IN CASE OF HOSPITALS, CLINICS OR
MEDICAL INSTITUTIONS, THE UNION AND EMPLOYER SHALL PROVIDE
AND MAINTAIN AN EFFECTIVE AND FUNCTIONAL WORKFORCE,
WHOSE MOVEMENT AND SERVICES SHALL BE UNHAMPERED AND
UNRESTRICTED, AS ARE NECESSARY TO ENSURE THE PROPER AND
ADEQUATE PROTECTION OF THE LIFE, PERSONAL SAFETY AND
HEALTH OF THEIR PATIENTS, MOST ESPECIALLY EMERGENCY
CASES, FOR THE DURATION OF THE LABOR DISPUTE.

WITHIN FIVE (5) DAYS FROM THE ISSUANCE OF THE ASSUMPTION OR
CERTIFICATION ORDER, A PRELIMINARY CONFERENCE OR HEARING
SHALL IMMEDIATELY BE CONDUCTED BY THE OFFICE OF THE
SECRETARY OF LABOR AND EMPLOYMENT, THE NATIONAL LABOR
RELATIONS COMMISSION, OR THE VOLUNTARY ARBITRATOR OR
PANEL OF VOLUNTARY ARBITRATORS AS THE CASE MAY BE

IN CASE OF ACTUAL OR IMPENDING STRIKE OR LOCKOUT IN
INDUSTRIES THAT ARE NOT ENGAGED IN ESSENTIAL SERVICES, THE
SECRETARY OF LABOR AND EMPLOYMENT MAY ASSUME
JURISDICTION UPON JOINT REQUEST OF BOTH PARTIES IN THE
LABOR DISPUTE AFTER THE MANDATORY CONCILIATION. EITHER OR


BOTH PARTIES MAY ALSO OPT TO SUBMIT TO COMPULSORY OR
VOLUNTARY ARBITRATION.

The foregoing notwithstanding, the President of the Philippines shall not be
precluded from determining industries that ARE ENGAGED IN ESSENTIAL
SERVICES and from intervening at any time and assuming jurisdiction over
any labor dispute in order to settle or terminate the same DURING SEVERE
NATIONAL EMERGENCIES.

Section 2. Article 264 of the Labor Code is hereby amended to read as follows:

“Article 264, Prohibited Acti

ies.-

a) No labor organization or employer shall declare a strike or lockout

without first having bargained collectively in accordance with Title VII of this
Book or without first having filed the notice required in the preceding
Article or without the necessary strike or lockout vote first having been
obtained and reported to the Department OF LABOR AND
EMPLOYMENT.

No strike or lockout shall be declared after assumption of jurisdiction
by the President or the Secretary or after certification or submission of the
dispute to compulsory or voluntary arbitration or during the pendency of
cases involving the same grounds for the strike or lockout.

b) Any worker whose employment has been terminated as a

°)

consequence of an [unlawful] ILLEGAL lockout shall be entitled to
reinstatement with full back wages.

Mere participation of a worker OR UNION OFFICER in a [lawful] strike
DECLARED ILLEGAL FOR FAILURE OF THE UNION TO COMPLY
WITH PROCEDURAL REQUIREMENTS UNDER PARAGRAPH (A) OF
THIS ARTICLE, shall not [constitute-sufficient] BE A ground for termination
of his OR HER employment, even if a replacement had been hired by the
employer during such [lawful] ILLEGAL strike

No person shall obstruct, impede, or interfere with, by force, violence,
coercion, threats or intimidation, any peaceful CONCERTED ACTION
INCLUDING picketing by employees during any labor controversy or in the
exercise of the right of self-organization or collective bargaining, or shall aid
or abet such obstruction or interference.

Any WORKER OR union officer who knowingly participates [inan-ilegal
strike-and-any-workeror-union-officer—_who—knowinglyparticipates] in the
commission of [ifegal] UNLAWFUL acts during a strike may be declared to
have lost his/her employment AFTER DUE PROCESS.

No employer shall use or employ any strike-breaker, nor shall any
person be employed as a strike-breaker.


e) No person engaged in picketing shall commit any act of violence,
coercion or intimidation or obstruct the free ingress to or egress from the
employer's premises for lawful purposes, or obstruct public thoroughfares.

f) NO PUBLIC OFFICIAL OR EMPLOYEE, INCLUDING OFFICERS AND
PERSONNEL OF THE ARMED FORCES OF THE PHILIPPINES OR THE
PHILIPPINE NATIONAL POLICE, OR ARMED PERSON, PRIVATE
SECURITY GUARDS AND SIMILAR PERSONNEL IN THE PRIVATE
SECURITY AGENCY SHALL INTRODUCE OR ESCORT IN ANY MANNER
REPLACEMENT WORKERS. THE POLICE FORCE SHALL KEEP OUT
OF THE PICKET LINES UNLESS ACTUAL VIOLENCE OR OTHER
CRIMINAL ACTS OCCUR THEREIN.

HOWEVER, THE SECRETARY OF LABOR AND EMPLOYMENT OR
THE NATIONAL LABOR RELATIONS COMMISSION MAY SEEK THE
ASSISTANCE OF LAW ENFORCEMENT AGENCIES TO MAINTAIN
PEACE AND ORDER, PROTECT LIFE AND PROPERTY, AND/OR
ENFORCE THE LAW AND LEGAL ORDER.

Section 3. Article 272 of the Labor Code is hereby amended to read as follows:
“Article 272. [Penalties] Fines.

a) Any person, EMPLOYER, ORGANIZATION OR CORPORATION FOUND
violating Article 264 of this Code shall be [punished—by—a] FINED [of] not
less than [one—thousand—pesos-(P1,000:00] TEN THOUSAND PESOS
(P10,000.00) nor more than [ten—thousand—pesos—(P10,000.00)]_ ONE
HUNDRED THOUSAND PESOS (P100,000.00) [and/or-imprisonment-for-not
less-than three-months-nor-more-than-three—(3)-yearsor_both-such—fine
and-imprisonment,] at the discretion of the [court] NATIONAL LABOR
RELATIONS COMMISSION. [Prosecution-under-this-provision-shall preclude
prosecution for the-same-act-under-the Revised Penal-Code-and vice versa,]

b) Upon the recommendation of the Secretary of Labor and Employment and the
Secretary of National Defense, foreigners who violate the provisions of this
Title shall be subject to immediate and summary deportation by the
[Commmission-on] BUREAU OF Immigration [and-Deportation] AND shall be
permanently barred from reentering the country without the special permission
of the President of the Philippines.”

THE REGULAR COURTS SHALL HAVE JURISDICTION OVER ANY
CRIMINAL ACTION ARISING FROM VIOLATION OF ANY OF THE
PROVISIONS OF ART. 264 OF THE LABOR CODE, AS AMENDED, BUT
SUBJECT TO THE REQUIRED CLEARANCE FROM THE DOLE ON CASES
ARISING OUT OF OR RELATED TO A LABOR DISPUTE.

0)

NO CRIMINAL PROSECUTION UNDER ARTICLE 264 MAY BE
INSTITUTED WITHOUT A FINAL JUDGMENT THAT AN ILLEGAL STRIKE
OR LOCKOUT HAS BEEN COMMITTED. THE PRESCRIPTIVE PERIOD OF


THE CRIMINAL OFFENSE SHALL BE CONSIDERED INTERRUPTED
DURING THE PENDENCY OF ADMINISTRATIVE PROCEEDINGS:
PROVIDED, HOWEVER, THAT THE FINAL JUDGMENT IN THE SAID
PROCEEDINGS SHALL NOT BE BINDING IN THE CRIMINAL CASE NOR
AN EVIDENCE OF GUILT.

2

COMPLAINTS ON ACTS OR OMISSIONS OF PNP OR AFP PERSONNEL
IN VIOLATION OF ARTICLE 264 OF THE LABOR CODE, AS AMENDED,
SHALL BE FILED WITH THEIR RESPECTIVE AGENCY WITHOUT
PREJUDICE TO THE FILING OF THE APPROPRIATE CASES BEFORE
THE OMBUDSMAN.

Section 4. Implementing Rules and Regulations. - The Secretary of Labor and
Employment shall promulgate the necessary rules and regulations to implement the
provisions of this Act.

Section 5. Separability Clause. If any part or provision of this Act is declared
unconstitutional or invalid, the remainder of this Act or the provisions not otherwise
affected shall remain valid and subsisting

Section 6. Repealing Clause.- All laws, presidential decrees, proclamations,
executive orders, issuances, rules and regulations, or any part thereof,
inconsistent with the provisions of this Act are hereby repealed, amended or
modified accordingly

Section 7. Effectivity. This Act shall take effect fifteen (15) days after its complete
publication in the official gazette or in at least two (2) newspapers of national
circulation

APPROVED.