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NINETEENTH CONGRESS 2 LO ny]
First Regular Session “2 G &y

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House BittNo. 498 Nena 7

Introduced by Representative Stella Luz A. Quimbo

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

AN ACT GRANTING EMPLOYEES IN THE PRIVATE SECTOR THE RIGHT TO
DESIGNATE THE BANK ACCOUNT TO WHICH THEIR WAGES OR
COMPENSATION MAY BE DEPOSITED AND AMENDING THE LABOR CODE OF
THE PHILIPPINES FOR THE PURPOSE

EXPLANATORY NOTE

Section 18, Article 1! of the 1987 Constitution provides that the State shall protect the
rights of workers and promote their welfare, while Section 19, Article XII of the 1987
Constitution mandates the State to prohibit combinations in restraint of trade and unfair
competition.

When employers in the private sector choose to which bank they will deposit their
employees’ wages, there is an unintended consequence on competition, and on
employee welfare. In such case, employees’ own choices are stifled, as they are
forced to open accounts in their employers’ chosen banks in order to receive their
hard-earned money. In effect, certain banks gain an undue competitive advantage and
secure more clients than others, simply because a singular entity — that is, the
employer — handpicked them.

Employees ought to be granted the freedom to choose which banks they will conduct
financial transactions with, including collecting their compensation. In deciding which
bank to open an account with, factors such as the attractiveness of financial products,
interest rates, and the geographical location of such banks are taken into
consideration. As banks would compete to attract consumers, they would be
incentivized to offer better goods and services.

However, this choice is bypassed when employers make this decision for all their
employees, to the detriment of the employees and of the economy. In such cases,
employees in the private sector are constrained to open and maintain accounts in
banks designated by their employers and to which their compensation will be
deposited, despite potentially less favorable terms or poorer services. Not infrequently,
the location of a designated bank is far from the place of residence of the employee,
such that the employee is deprived of the convenience of withdrawing money from
nearer banks, or else must maintain several bank accounts, which imply unnecessary
additional costs. Further, unlike a few years ago, inter-banking activity has dramatically
become easier because of online banking.


This measure proposes to grant employees in the private sector the right to designate
their bank of choice, to which their wages or compensation can be deposited
conveniently withdrawn, in the interest of promoting market competition and employee
warfare.

In view of the foregoing, the passage of this bili is earnest sought

Tor

STELLA YUZ A. QUIMBO, PhD
Representative
Second District, Marikina City


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

NINETEENTH CONGRESS
First Regular Session

HOUSE BILL NO. 496

Introduced by Representative Stella Luz A. Quimbo

AN ACT GRANTING EMPLOYEES IN THE PRIVATE SECTOR THE RIGHT TO
DESIGNATE THE BANK ACCOUNT TO WHICH THEIR WAGES OR
COMPENSATION MAY BE DEPOSITED AND AMENDING THE LABOR CODE OF
THE PHILIPPINES FOR THE PURPOSE

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

SECTION 1. Title. - This Act shall be known as the “Bank Account Portability for
Workers Act.”

SECTION 2. Amendment to the Labor Code of the Philippines. - A second sentence
shall be added to the first paragraph of Article 102, Chapter Ill, Title |, Book Three, of
Presidential Decree No. 442 as amended and renumbered, otherwise known as the
Labor Code of the Philippines, so that the entire first paragraph shall read as follows:

“ART. 102. Forms of Payment. — No employer shall pay the wages of an
employees by means of promissory notes, vouchers, coupons, tokens, tickets,
chits, or any object other than legal tender, even when expressly requested by
the employee. An employee shall have the right to designate the bank account
to which their wages shall be deposited, based on a list of at least five (5) bank
options to be given by the employer: Provided, that if none of the bank options
presented by the employer is feasible to the employee, the employer may pay
the employee's wages by issuing a company cheque, sending cash
electronically, or by disbursing cash to the employee.

Payment of wages by check or money order shall be allowed when such
manner of payment is customary on the date of effectivity of this Code, or is
necessary because of special circumstances as specified in appropriate
regulations to be issued by the Secretary of Labor and employment or as
stipulated in a collective bargaining agreement.”

SECTION 3. Implementing Rules. ~ The Department of Labor and Employment shall,
within ninety (90) days from the effectivity of this Act, promulgate such rules and
regulations as may be necessary for the effective implementation of this Act


SECTION 4. Repealing Clause. - All laws, decrees, executive orders, rules and
regulations or parts thereof, which are inconsistent with this Act, are hereby repealed,
amended or modified accordingly.

SECTION 5. Effectivity. - This Act shall take effect fifteen (15) days following its
publication in the Official Gazette or in two (2) newspapers of general circulation.

Approved,