Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

EIGHTEENTH CONGRESS
First Regular Session

House Bill No. 6186

Introduced by Representative Ron P. Salo

EXPLANATORY NOTE

The government is considered to be the biggest employer, considering the
size of government bureaucracy. Based on the 2019 staffing summary of the
Department of Budget and Management (DBM), the entire government structure has
a total of 1,863,361 permanent positions, including the President down to the lowest-
paid employee. Further, there are those positions whose term of employment are
considered to be temporary, contractual or fixed term, casual, or job order, or simply
referred to as contractual employees or ‘endo’ in the government.

Based on the 2017 data provided by the Civil Service Commission (CSC),
there are more than 660,000 contractual employees in the government. From these
660,000 contractual employees, seventy percent (70%) were hired by the LGUs
which comprise roughly about 460,000 thousand ‘endo’ personnel.

Although the latest available government data points to the fact that our
unemployment rate has steadied at 5.4% in recent times, finding or landing on
another job still requires time and normally results to financial constraints that will
certainly impact the lives of these displaced employees, as well as that of their
families.

With the current Administration being sensitive to the sentiments of the people
over the issue of ‘endo’, the government already made some efforts to prioritize
contractual and job order employees in filling up vacant positions in the government
through a joint circular (Joint Circular No. 1, S. 2017) issued by the CSC, COA, and
DBM in June 15, 2017.

On the part of Congress, House Bill 00953 was recently filled by the
undersigned providing for the automatic civil service eligibility to those who have
rendered at least three consecutive years of government service or at least five non-
consecutive years, and whose appointment is either contractual, casual, or job order.

Notwithstanding the above measures, the government should implement
more measures aimed at the regularization of as many government employees as
possible, in order for the government to have the moral ascendancy to call for an end

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to the practice of ‘endo’ in the private sector. Nonetheless, it is noted that
regularizing all these ‘endos’ in the government will pose a great challenge,
especially on the aspect of fiscal management.

With the regularization of all government employees still being a work in
progress, it is necessary that a financial assistance be extended to these employees
upon the termination of their contract in order to assist them as they seek other
employment opportunities. For this purpose, it is proposed that a “Government
Unemployment Assurance Mutual Fund” be created for these contractual, casual
and job order employees in the government.

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

RON P. SALO
KABAYAN Party List

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Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

EIGHTEENTH CONGRESS
First Regular Session

6186
House Bill No.

Introduced by Representative Ron P. Salo

AN ACT
CREATING THE GOVERNMENT UNEMPLOYMENT ASSURANCE MUTUAL
FUND FOR THE BENEFIT OF SEPARATED GOVERNMENT EMPLOYEES AND
FOR OTHER PURPOSES

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

SECTION 1. Short Title. -. This Act shall be known as “The Government
Unemployment Assurance Mutual Fund”

SEC. 2. Declaration of Policy — The State affirms the role of those in the civil
service as its primary partners in delivering efficient government services to the
people. To ensure the welfare of government employees, particularly those who are
contractual, casuals and job orders, the State hereby creates a mutual fund that will
provide displaced or separated government employees belonging to these groups
with the unemployment financial assistance during the period of their unemployment.

SEC. 3. Definition of Terms —

a. Casual Employment — an appointment issued
only for essential and necessary services where there are not enough regular
staff to meet the demands of the service and for emergency cases and
intermittent period, not to exceed one year.

b. Contractual Employment - an appointment
issued to a person whose employment in the government is in accordance
with a special contract to undertake local or foreign assisted projects, or a
specific work or job requiring special or technical skills not available in the
employing agency, to be accomplished within a specific period.

c. Job Order — refers to piece work, intermittent or
emergency jobs such as clearing of debris on the roads, canals, waterways,
etc., after natural/man-made disasters/occurrences and other manual/trades

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and crafts services such as carpentry, plumbing, electrical and the like. These
jobs are of short duration and for a specific piece work.

d. Employer — shall mean the Government of the
Republic of the Philippines, its political subdivisions including the various
Local Government Units (LGUs), agencies, instrumentalities, and Government
Owned and Controlled Corporations (GOCCs) with original charter.

e. Government Employees — for the purpose of this
Act, the term Government Employees shall refer to any person working for the
Government of the Republic of the Philippines, its political subdivisions
including the various Local Government Units (LGUs), agencies,
instrumentalities, including Government Owned and Controlled Corporations
(GOCCs) with original charter, who are employed as casual, contractual, .or
job order.

i Unemployment Financial Assistance (UFA) -
shall refer to the financial assistance which shall be given to the displaced or
separated government employee during the period of unemployment.

9. Separation — shalll refer to the severance of the
employment relationship of the government employee without cause on the
part of the government employee.

SEC. 4. Creation of the Assurance Fund. — There is hereby created an
Assurance Fund for displaced government employees covered by this Act. The Fund
shall be sour from the mandatory contributions of both the employer and the
employee as provided under Section 6 of this Act.

SEC. 5. Covered Employees - For the purpose of this Act, covered
employees shall include all employees of the Government of the Republic of the
Philippines, its agencies, its political subdivisions including the various Local
Government Units (LGUs), and its instrumentalities including Government Owned
and Controlled Corporations with original charter, who are considered contractual,
casual or job orders, who have completed their employment contract or their contract
was pre-te!
concerned.

SEC. 6. Duty to Contribute, Withhold, and Remit to the Mutual Fund -
Within the period of seven (7) days from the end of each month, the employer shall
remit to the Frutual fund an amount equivalent to twenty (20) per cent of the
employee's monthly basic compensation which shall be the employer's share to the
mutual fund. Likewise, the employer is mandated to withhold and remit to the mutual
fund within the same period stated above, an amount equivalent to five (5) per cent
of the employee's basic compensation which shall be the employee's share to the
mutual fund. Said duty to contribute shall cease upon regularization of the employee
concerned.

inated by the government without the consent of the employee

SEC. 7. Administration of the Assurance Fund — The contributions to the
mutual fund shall be managed by a non-profit entity engaged by the Civil Service
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Commission. It shall serve as the mutual fund administrator subject to the

n of the Insurance Commission, and audit by the Commission on Audit.
The Civil Service Commission shall issue the appropriate guidelines, outlining the
criteria, in selecting the fund administrator.

SEC. 8. Benefits of the Assurance Fund — Government employees covered
by this Act who have been separated from work by virtue of the completion of his or
her employment contract shall be entitled to an unemployment financial assistance if
such separated employee remains unemployed for a period of at least thirty (30)
days from the date of separation. The separated employee shall be entitled to
receive the following: an amount equivalent to forty percent (40%) of the monthly
compensation of the separated employee from his or her last employment to be
given on the 35" day of unemployment; an amount equivalent to forty percent (40%)
of said nay compensation he or she received from his or her last employment to
be given on the 65 day of unemployment; and an amount equivalent to forty
percent (40%) of the monthly compensation he or she received from his or her last
employment to be given on the 95" day of unemployment.

SEC. 9. Cessation of Benefits. - The benefits under this Act shall not be
given in case the employment contract is renewed. Once already given, it shall
cease as soon as the employee gets employed whether in the government or in the
private sector.

SEC. 10. Separability Clause — If any provision or portion of this Act is
declared unconstitutional, the remainder of this Act or any provision not thereby
affected shall remain in full force and effect.

SEC. 11. Repealing Clause. - all laws, decrees, executive orders,
ordinances, rules, regulations, or other issuances, or parts thereof which are
inconsistent with any of the provisions of this Act are hereby repealed, amended,
and/or modified accordingly.

SEC. 12. Implementing Rules and Regulations. - The Civil Service
Commission (CSC), and the Insurance Commission (IC), shall issue the
Implementing Rules and Regulations (IRR) within ninety (90) days from the
effectivity of this Act.

SEC. 13. Effectivity. - This Act shall take effect fifteen (15) days after its
publication in the Official Gazette or in two (2) newspapers of general circulation.

Approved.

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