Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

THIRTEENTH CONGRESS
First Regular Session

HOUSE BILL No._ 873

Introduced by Representative Faysah RPM Dumarpa

EXPLANATORY NOTE.

Among our country’s labor force, those hired through job agencies are the most
exploited, neglected, oppressed, and very much underpaid.

They laboriously exert their efforts to carry out their duties and responsibilities,
and other tasks assigned to them by the company they cannot even call their employer.

But their efforts proved futile for they are not receiving the compensation rightly
due them

It may even be impossible for them to get their retirement benefits after years of
hard work.

This is a great abuse on the part of job contractors/agencies. These workwers are
entitled to receive all the benefits under the law.

Against such backdrop, this bill is filed to amend Article 106 of Presidential
Decree 442 as amended.

This bill commands/directs companies/employers that workers hired through job
contractors must receive all the benefits due them. However, if in any case the workers
are not able to receive the benefits justly for them, they can likewise get their attention to
the company they are working for redress.

Hence, the early passage of this bill is earnestly sought.

Bl ocr gage ——$—
FAYSAH RPM DUMARPA.


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon

‘THIRTEENTH CONGRESS
First Regular Session

HOUSE BILL No._ 873

Introduced By Representative Faysah Rom Dumarpa

AN ACT
EXPANDING THE LIABILITIES OF INDIRECT EMPLOYERS IN THEIR JOB
CONRACTING, COVERING OTHER BENEFITS DUE THEIR EMPLOYEES,
AMENDING FOR THE PURPOSE ARTICLE 106 OF PRESIDENTIAL DECREE
442, AS AMENDED, OTHERWISE KNOWN AS THE LABOR CODE OF THE
PHILIPPINES

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

SECTION 1. Article 106 of Presidential Decree 442, as amended otherwise
known as the Labor Code of the Philippines is hereby further amended by adding a
paragraph, to read as follows

“ART. 106, Contractor or subcontractor - Whenever an employer enters
into a contract with another person for the performance of the former’s work, the
employees of the contractor and of the latter's subcontractor, if any, shall be paid in
accordance with the provisions of this Code.

In the event that the contractor or subcontractor fails to pay the wages of
his employees in accordance with this Code, the employer shall be jointly and
severally liable with his contractor or subcontractor to such employees to the
extent of the work performed under the contract, in the same manner and extent
that he is liable to employees directly employed by him.


IF THE EMPLOYEES OF THE CONTRACTOR OF
SUBCONTRACTOR HAVE RENDERED AT LEAST ONE YEAR OF SEVICE
TO THE SAME EMPLOYER, WHETHER OR NOT SUCH EMPLOYMENT IS
CONTINUOUS, SUCH EMPLOYER SHALL ALSO BE JOINTLY AND
SEVERALLY BE LIABLE WITH THE CONTRACTOR OR
SUBCONTRACTOR FOR THE PAYMENT OF THE EMPLOYEES’
BENEFITS, INCLUDING, BUT NOT LIMITED TO THEIR SEPARATION OR
RETIREMENT BENEFITS, PROVIDED, THAT THE LIABILITY OF THE
INDIRECT EMPLOYER SHALL BE LIMITED ONLY TO THE PERIOD
THAT SUCH EMPLOYEE RENDERED SERVICES TO THE SAID INDIRECT
EMPLOYER, THE AVAILMENT AND GRANT OF SEPARATION,
RETIREMENT AND OTHER BENEFITS SHALL BE IN ACCORDANCE
WITH EXISTING LAWS.

The Secretary of Labor may, by appropriate regulations, restrictor
prohibit the contracting out of Labor to protect the rights of workers established
under this Code. In so prohibiting or restricting, he may make appropriate
distinctions between labor-only contracting and job contracting as well as
differentiations within these types of contracting and determine who among the
parties involved shall be considered the employer for purposes of this Code.
There is "labor only” contracting where the person supplying workers to an
employer does not have substantial capital or investment in the form of tools,
equipment, machineries, work premises, among others, and the workers recruited
and be placed by such persons are performing activities which are directly related
to the principal business of such employer. In such cases, the person or
intermediary shall be considered merely as an agent of the employer who shall be
responsible to the workers in the same manner and extent as If the latter were
directly employed by him.”

SEC. 2. If any provision of this Act is held unconstitutional, other provisions not
affected thereby shall remain valid and binding.

SEC. 3. All laws, presidential decrees, rules and regulations insofar as they are
inconsistent with this Act, are hereby repealed, amended or modified accordingly,

SEC. 4. This Act shall take effect fifteen (15) days following its publication in
the Official Gazette of two (2) national newspapers of general circulation

Approved.