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Republic of the Philippines
House of Representatives
Quezon City

EIGHTEENTH CONGRESS
Second Regular Session

House BillNo.__ 8229

Introduced by REPRESENTATIVE ERIC L. OLIVAREZ

EXPLANATORY NOTE

In the most recent labor force survey conducted by the Philippine
Statistics Authority, the country's unemployment rate in October 2020 was
estimated at 8.7 percent. This is equivalent to 3.8 million unemployed
Filipinos. This crisis was an expected occurrence brought about by the
Covid-19 global pandemic where a lot of commercial establishments and
businesses were forced to close down and cease operations as a result of
State-imposed community quarantines in order to curtail the spread of the
dreaded virus.

In light of this unfortunate event, it is important now more than ever for
the State to assume and uphold its role and duty as a parent to its citizens
to provide aid and assistance to Filipinos who find themselves without any
gainful employment though not of their own will, fault, and choice. This bill
seeks to provide an unemployment compensation to unemployed Filipinos
who are willing and able to find new work, albeit hampered by the lack of
funds to sustain them during the months of job seeking.

To be sure, this bill does not wish to disincentivize our people from
standing on their own feet and actually working, that is why the
unemployment compensation being proposed is intentionally kept to a


relatively controlled amount pegged at six thousand pesos per month, for a
maximum of two months or until such time that new employment is found by
the laid-off worker, whichever comes first. The unemployment compensation
being proposed by this bill aims to help the laid-off worker on the necessary
expenses he/she would have to incur in trying to find a new job such as costs
on transportation going from one company/agency to another, meals to get
him/her through the days of applying, decent clothing for interviews, printing
of curriculum vitae and resumes, among others.

By approving this bill, unemployed Filipinos will have a better and
faster shot at finding new employment because the unemployment
compensation they would have received would allow them to seek more job
Opportunities actively and would enable them to prepare and perform well in
the application process and the initial hiring stages of a potential/prospective
employment.

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Republic of the Philippines
House of Representatives
Quezon City

EIGHTEENTH CONGRESS
Second Regular Session

8229

House Bill No.

Introduced by REPRESENTATIVE ERIC L. OLIVAREZ

AN ACT INSTITUTING UNEMPLOYMENT COMPENSATION FOR FORMAL
AND INFORMAL SECTOR WORKERS, AND APPROPRIATING
FUNDS THEREFOR

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

Section 1. Short Title. This Act shall be known as the “Unemployment Compensation Act
of 2020".

Sec. 2 Statement of Policy. Itis a well-entrenched and established policy of the State to
afford full protection to its labor force, provide equal employment opportunities for all,
Promote social justice, ensure prosperity and ultimately free people from poverty through
Sound policies that provide decent and humane conditions of living and improved quality
of life for all.

Sec. 3. Coverage — Any worker belonging to the formal sector being so employed either
in the public or private sector, who is involuntarily separated from employment, shall be
covered by this Act. Provided, that the employee is able and willing to work after the time
of involuntary separation from employment,

Those who belong in the informal sector including but not limited to independent,
self-employed small-scale producers and distributors of goods and services shall be
entitled to the unemployment compensation benefits upon showing that their primary


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Source of income has ceased or is about to cease and they are now actively seeking
employment and trying to transition to the formal sector,

Sec. 4. Unemployment Compensation in the Private Sector. Employees
involuntarily separated from employment due to authorized causes provided for in Articles
298 (283) and 299 (284) to wit:

a. Installation or labor-saving devices
. Redundancy

._Retrenchment or downsizing

. Closure or cessation of operation

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. Diseaseiiliness of the employee whose continued employment is
Prohibited by law or is prejudicial to his or her co-employees’ health

as well as due to just causes under Article 300 (285) of the Labor Code, as amended,
for which an employee may put an end to the employment relationship without notice to
employer, to wit:

f. Serious insult by the employer or his representative on the honor and
person of the employee

9. Inhuman and unbearable treatment accorded the employee by the
employer or his representative

h. Commission of a crime or offense by the employer or his representative
against the person of the employee or any of the immediate members or
any of the immediate members of his/her family

i. Other causes analogous to any of the foregoing:
+ Economic downturn
+ Natural or human-induced calamities/disasters

+ Other analogous cases as may be determined by proper
authorities.

shall be entitled to receive unemployment benefits as provided for in Republic Act (RA)
No. 11199 otherwise known as the “Social Security Act of 2018”, particularly Section 14-
B thereof.

Provided, however, that in case the average monthly compensation that the laid-off
worker is entitled to as per SSS, is below six thousand pesos (Php 6,000) per month, the
Department of Labor and Employment (DOLE) shall provide the unemployment
compensation differential to complete the said amount to be computed as follows:


CoVauaw

(Php6,000.00 — Actual amount of SSS unemployment benefit received) =
Unemployment Compensation Differential

Provided further, that if the employee is ineligible to claim unemployment benefits under
the SSS because of (1) failure to comply with the contribution requirement of SSS" law
though through no fault of the employee, or (2) in case of concurrence of two or more
benefits (i.e. the concurrence of unemployment benefit and another type of benefit under
SSS whereby the latter is higher than the former and only the highest one shall be paid
by SSS), the DOLE shall then pay the monthly unemployment compensation of six
thousand pesos (Php6,000.00) in full, for a maximum of two (2) months. Provided, that in
order to claim the unemployment compensation for the second month, the said laid-off
employee shall provide adequate proof, as determined by DOLE, that he/she is actively
seeking employment. Provided further, that the unemployment compensation benefit can
only be availed of once every three (3) years.

Sec. 5. Unemployment Compensation in the Government/Public Sector. A permanent
government employee who is involuntarily separated from the service as a result of the
abolition of his/her office or position shall be entitled to receive unemployment benefits as
provided for in RA No. 8291 otherwise known as the “Revised Government Service
Insurance System Act of 1977”.

Provided however, that in case the average monthly compensation that the government
employee is entitled to receive per the GSIS law is below six thousand pesos (Php 6,000)
Per month, the employer government agency shall provide the unemployment
compensation differential to complete the said amount not later than seven (7) days after
the official date of termination of the employee. Provided further, that if the employee is
ineligible to claim unemployment benefits under the GSIS law because of (1) failure to
comply with the contribution requirements of GSIS? though through no fault of the
employee, or (2) in case of concurrence of two (2) or more benefits (i.e. concurrence of
the unemployment benefit and another type of benefit under GSIS whereby the latter is
higher than the former and only the highest one shall be paid by GSIS) the employer
government agency shall then pay the monthly unemployment compensation of six
thousand pesos (Php6,000) in full, for a maximum of two (2) months.

Sec. 6. Ineligibility. An employee in the private sector shall be ineligible to receive
unemployment benefit if he/she has been involuntarily separated from employment due
to just causes under Article 297 (282) of the Labor Code, as amended, covering any of
the following act/s by the employee:

+ Serious misconduct

+ Willful disobedience to lawful orders

+ Gross and habitual neglect of duties

* SSS law requires that a member has paid at least 36 months contributions 12 of which should in the eighteen-
month period immediately preceding the involuntary employment.

® GSIS law requires that the laid off worker must have been paying the contributions for at least one (1) year prior
to separation,


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+ Fraud or will breach of trust/loss of confidence
+ Commission of a crime or offense

+ Analogous cases like abandonment, gross inefficiency, disloyalty/conflict of
interest/dishonesty.

A permanent employee in the government/public sector shall be ineligible to receive
unemployment benefit from his/her employer agency if his involuntary separation was due
to causes that violate the provisions of RA No. 6713, otherwise known as the “Code of
Conduct and Ethical Standards for Public Officials and Employees", as well as the
applicable Civil Service Rules and Regulations pertaining to the dropping from the rolls
of the government employee due to serious infractions and tardiness, among other
serious grounds that undermine and demoralize the position held by the subject
employee.

Sec. 7. Unemployment Compensation in the Informal Sector. An informal sector worker,
aged eighteen (18) to not over 60 years of age, not covered by either the SSS or GSIS,
and who involuntarily lost his/her means of livelihood for reasons including but not limited
to economic downtum, natural or human-induced calamities/disasters, pandemic, and
other analogous cases as may be determined by DOLE, shall be entitled to
unemployment compensation from DOLE, in the form of cash payments equivalent to six
thousand pesos (Php6,000.00) per month for a maximum of two (2) consecutive months
or until such time that the informal worker has found gainful employment, whichever
comes earlier. Provided, that in order to claim the unemployment compensation for the
second month, the said informal worker shall provide adequate proof, as determined by
DOLE, that he/she has lost or will imminently lose his/her means of livelihood and is
actively seeking employment. Provided further, that the unemployment compensation
benefit can only be availed of once every three (3) years.

Sec. 8. Employer's Additional Duties. For purposes of ensuring the effectivity of the
implementation of this Act, particularly Section 5 hereof, upon request of the applicant, all
employers in the Philippines shall now be mandated to issue certificates of application
whether in electronic form or in paper print-out, or other efficient and practical means,
duly signed by the hiring officer or other officers of equal and/or higher ranks who are in
charge of or who participate in the hiring/recruitment process of the company.

Sec. 9. Penalties. Any person, employer, partnership, or corporation found to violate any
provisions of this Act shalll pay a fine of one hundred thousand pesos (Php100,000.00)
for the first offense, two hundred fifty thousand pesos (Php 250,000.00) for the second
offense, and five hundred thousand pesos (Php 500,000.00) for the third and succeeding
offenses.

Sec. 10. Appropriations. No less than a total amount of one hundred billion pesos
(Php100,000,000,000.00) shall be appropriated for the first three (3) years of its


1 operations to ensure the effective implementation of this Act. Thereafter, the amount
2. needed to implement this Act with respect to the National Government shall be included
3 in the annual General Appropriations Act.

4 Sec. 11. Implementing Rules and Regulations (IRR). The DOLE, GSIS, and SSS shall
5 promulgate the implementing rules and regulations for the effective implementation of this,
6 Actwithin ninety (90) days from approval thereof.

7 Sec. 12. Separability Clause. if any part or provision of this Act is subsequently declared
8 unconstitutional or invalid, other parts or provisions hereof not affected thereby shall
9 remain in full force and effect.

10 Sec. 13, Repealing Clause. All laws, decrees, executive orders, rules and regulations or
11 parts thereof inconsistent with the provisions of this Act are hereby repealed, amended,
12 or modified accordingly.

13 Sec. 14. Effectivity Clause. This Act shall take effect fifteen (15) days after its publication
14 _ in the Official gazette or in at least two (2) newspapers of general circulation.

15. Approved.