Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
NINETEENTH CONGRESS 
First Regular Session 
HOUSE BILL NO. _______ 
Introduced by HON. GUS S. TAMBUNTING 
AN ACT 
TO PROTECT WORKERS IN THE EVENT OF COMPANY CLOSURES OR CESSATION OF 
OPERATIONS BY ESTABLISHING THE MECHANISM AND PROPER STANDARDS THEREFOR 
AND FOR OTHER PURPOSES 
EXPLANATORY NOTE 
This bill seeks to protect workers in cases of company closure or cessation of operations of 
establishments. Workers as partners in the production of wealth and income have to be protected and 
afforded their basic workers' rights. 
While poverty increases in the country, so do inequality thus, workers in times of economic depression 
should be protected. Company closures and cessation of business activities are inevitable. Various 
factors affect the business cycle and business productivity hence, workers in most inopportune times 
of economic recessions are caught in the web of unemployment. The loss of business is tantamount to 
loss of employment. 
The Department of Labor and Employment (DOLE) - Bureau of Labor and Employment Statistics 
reported that in the year 2012, the total number of establishments resorted to permanent closures or 
retrenchment due to economic reasons totaled 1,925 enlisted in 2013 displacing a total of 36,639 
workers nationwide. Suffice it to say that, a vast number of minimum wage earners and their families 
have been economically displaced. The figure was significantly higher than the 35,526 workers who 
lost their jobs in 2011 when some 2,211 companies’ shutdown and 31,778 in 2012. 
Metro Manila recorded the highest number of displaced workers. A total of 1,925 commercial 
establishments field Notice of Closures affecting 17,144 workers in 2013. 
Employers cited downsizing as a main reason for the retrenchment and closures, financial losses and 
lack of market as factors that caused establishments to lay off or close shop which led to 
underemployment of nearly 13,000 workers. 
The creation of a Workers' Protection Board shall ensure that the workers' rights are protected and 
rightful benefits are afforded to them. 
On behalf of the people of Parañaque City’s Second District, and for the common good of the Filipino 
people, the approval of the said measure is earnestly sought. 
REP. GUS S. TAMBUNTING 
2nd District, Parañaque City 
September 16, 2022
1:08 pm
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Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
EIGHTEENTH CONGRESS 
First Regular Session 
HOUSE BILL NO. ________ 
Introduced by HON. GUS S. TAMBUNTING 
AN ACT 
TO PROTECT WORKERS IN THE EVENT OF COMPANY CLOSURES OR CESSATION OF 
OPERATIONS BY ESTABLISHING THE MECHANISM AND PROPER STANDARDS THEREFOR 
AND FOR OTHER PURPOSES 
Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled: 
CHAPTER 1 - PRELIMINARY PROVISIONS 
SECTION 1. Short Title. – This Act may be cited as the "Workers' Protection Act of 2019." 
SECTION 2. Declaration of Policy. – It is hereby declared the policy of the State to protect workers 
from economic insecurity due to involuntary unemployment and promote their rights in the event such. 
For this purpose, the State herby recognizes the rights of all workers: 
1)
To a reasonable period of notice for termination of employment;
2)
To seek alternative employment during the period of notice;
3)
To guarantee payments of wage claims; and
4)
To petition the proper government agency to review any act of an employer to close shop,
cease operations, and/or order a mass layoff of employees.
SECTION 3. Definition of Terms. – As used in this Act, the following terms: 
a.
Bankruptcy shall mean a condition whereby an employer, who after a petition to the court by
himself or his creditors, is judged legally insolvent.
b.
Closure shall mean the permanent cessation of operations due to insolvency, bankruptcy,
foreclosure, and/or dissolution resulting in an employment loss.
c.
Cessation of operations shall mean the permanent or temporary shutdown of a single site of
employment or one or more facilities or operating units within a single site of an employment,
if the shutdown resulted in an employment loss at the single site of employment. For purposes
of this Act, it shall include but not exclusive of, cessation of operations due to bankruptcy,
closure, foreclosure, insolvency, dissolution and other similar acts.
d.
Insolvency shall mean the condition whereby an employer is unable to meet his obligations as
they accrue in the course of his trade or business.
e.
Employer shall mean any person acting directly or indirectly in the interest of an employer in
relation to an employee and shall include, all government-owned or controlled corporations and
institutions, as well non-profit private institutions, or organizations.
f.
Employee shall mean any individual employed an employer.
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g. Mass lay-off shall mean a reduction in force which (i) is not a result of a closure and (ii) results 
in an employment loss at the single site of employment during any 30-day period for (1) at 
least thirty three percent (33%) of employees, and/or (2) at least fifty (50) employees, 
excluding part-time employees. 
 
h. Affected employees shall mean employees who may reasonably be expected to experience an 
employment loss as a consequence of a proposed cessation of operations or mass layoff by 
their employer. 
 
i. 
Involuntary unemployment shall mean the termination of employment by an employer as a 
result of cessation of operations.  
 
j. 
Employment loss shall mean (i) a termination of employment, other than a discharge for cause, 
voluntary departure or retirement, (ii) a layoff exceeding six (6) months, or (iii) a reduction in 
hours of work of more than fifty percent (50%) during each month of any six-month period. 
 
k. Foreclosure shall mean the process by which a mortgagee acquires an absolute title to the 
property of which he had previously been only the conditional owner, or upon which he had 
previously a mere lien or encumbrance. 
 
CHAPTER 2 - NOTIFICATION REQUIREMENT 
 
SECTION 4. Notification Requirement. – An employer shall not order a plant closure, mass layoff, 
shutdown or any form of cessation of operations until the end of a 90-day period after the employer 
serves written notice of such an order: 
 
a) To each affected employee; 
b) To each collective bargaining representative; 
c) To the chief elected official of the local government unit within such closing or lay-off to occur; 
and 
d) To the Labor Protection Board as herein created. 
 
 
SECTION 5. Right to Alternative Employment. – During the 90-day notice period which shall 
commence upon the receipt of the said notice by the affected employee, an employer shall allow the 
affected employee to use a specific amount of paid work time to seek alternative employment. 
 
SECTION 6. Right to Petition the Act of the Employer. – During the 90-day notice period, the 
affected employees or their collective bargaining representative may petition the Labor Protection Board 
as herein created to investigate possible anomalies arising from the intended closure or cessation of 
operations by an employer. 
 
SECTION 7. Civil Actions Against Employers. - Any employer who orders a closure or mass layoff 
or shutdown or any form of cessation of operations or mass layoff in violation of Sec. 4 of this Act shall 
be liable to each aggrieved employee who suffers an employment loss as a result of such closure or 
mass layoff or any form of cessation of operations for the following: 
 
a) Back pay for each day of violation at a rate of compensation not less than the final regular rate 
received by such employee, including benefits and conditions; and  
 
b) Mandatory severance pay. 
 
Any employer who violates Sections 4 and 5 of this Act shall be subject to a civil penalty of ten thousand 
pesos (P10,000.00) for each day of violation, provided however that such penalty shall not apply if the 
employer pays to each aggrieved employee the amount for which the employer is liable to that 
employee within three (3) weeks from the date the employer orders the closure or mass layoff or 
shutdown or cessation of operations. 
 


CHAPTER 3 - THE WORKERS PROTECTION BOARD 
 
SECTION 8. The Workers Protection Board. - For purposes of this Act, there shall be created an 
independent agency to be known as the Workers Protection Board (WPB). 
 
SECTION 9. Composition. – The Board shall compose of a Chairman and two (2) Members who shall 
be nominated and elected in a Labor Conference called for this purpose except for the Chairman who 
shall be appointed by the President from a selection of three nominees submitted by the Labor 
Conference which shall be held within thirty (30) days following the effectivity of this Act and shall be 
attended by delegates presenting major labor federations. 
 
SECTION 10. Qualification of Nominees. – The nominees for both the Chairman and Members 
must have the following qualification: 
 
a) Satisfactory background on labor and commerce particularly on corporation rules and laws. 
b) Must not have worked or performed functions in any management of a company or 
establishment in the past. 
c) Must not have business interest in any corporation or establishment. 
d) Must not be related to any corporate official within the fourth degree of consanguinity. 
 
SECTION 11. Power and Functions. – The Board shall, in coordination with the Department of 
Labor and Employment (DOLE), Securities and Exchange Commission (SEC), and the Department of 
Justice (DOJ), perform the following functions: 
 
a) Undertake the investigations, shutdown, rotation or retrenchment of workers/employees due 
to labor saving devices to prevent losses, dissolution, insolvency or bankruptcy; 
 
b) Compel the disclosure and submission of its book of accounts and other financial records 
following an information to the Board that the company or establishment will lead to closure or 
cessation of operation, shutdown, rotation or retrenchment of employees/workers; 
 
c) Issue subpoenas to any official of a company or establishment and other parties concerned to 
require attendance in the investigation; 
 
d) Hold custody of the company's machinery and other production equipment from the 
commencement of the investigation, or to require the posting of bond or both to secure the 
interests of the affected workers/employees; 
 
e) Ensure that payment of wages/salaries and other benefits were being made continuously while 
the company is undergoing an investigation; 
 
f) 
Ensure issuance of notices to workers/employees as required in this Act and the enforcement 
of the period to seek alternative employment; 
 
g) facilitate the immediate release of monetary claims of workers/employees which may be made 
through banks or which be deemed sufficient by the Board; 
 
h) Conduct quarterly inspection on the book of accounts and financial records of the companies 
and establishments registered with the Securities and Exchange Commission to monitor its 
operations; and 
 
i) 
Initiate legal action against any company or establishment found to violate any of the provision 
of this Act. 
 
SECTION 12. Funding. – The funding requirements necessary to carry out the provisions of this Act 
shall be charged to the current fiscal year appropriations of the Department of Labor and Employment. 


Thereafter, such sum as may be necessary is hereby authorized to be appropriated in the General 
Appropriations Act on the succeeding year its enactment into law. 
 
CHAPTER 4 - FINAL PROVISIONS 
 
SECTION 13. Implementing Rules and Regulations. – The implementing rules and regulations 
necessary to carry out the provisions of this Act shall be adopted and promulgated by the Department 
of Labor and Employment. 
 
SECTION 14. Repealing Clause. – All laws, executive orders and provisions thereof inconsistent with 
this Act hereby repealed or modified accordingly. 
 
SECTION 15. Separability Clause. – If any provision or part of this Act, or the application thereof 
to any person or circumstance, is held invalid or unconstitutional, the remainder of this Act or the 
application of such provision or part thereof to other persons or circumstances shall not be affected 
thereby. 
 
SECTION 16. Effectivity Clause. – This Act shall take effect fifteen days after its publication in at 
least two (2) national newspapers of general circulation. 
 
Approved,