Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
TWENTIETH CONGRESS 
First Regular Session 
HOUSE BILL NO. 1988 
Introduced by HON. MIGUEL LUIS R. VILLAFUERTE, HON. VINCENZO 
RENATO LUIGI R. VILLAFUERTE, HON. TSUYOSHI ANTHONY G. HORIBATA, AND 
HON. TERRY L. RIDON 
EXPLANATORY NOTE 
Digital transformation has revolutionized all facets of life, including work. From the 
traditional working setup, we are now seeing the skyrocketing demand for freelance work, 
especially on online platforms. Categorized as operating under the informal economy, 
freelance work in the country typically includes virtual assistance, delivery of creative services, 
digital marketing, and other forms of services that are project-based and primarily focus on 
output compliance.   
According to the 2020 Global Gig Economy Index by Payoneer, the Philippines ranked 
as the fastest-growing freelancing country after a 208% growth in revenue. Worldwide, the 
country ranks third in terms of freelance workers market size, next to the United States and 
India.1 However, freelance workers in the country face concerns on inadequate legal and labor 
protections, social security, and taxation. Section 18, Article II of the 1987 Constitution 
provides that “The State affirms labor as a primary social economic force. It shall protect the 
rights of workers and promote their welfare.” Further, Section 3, Article XIII of the same states 
that “The State shall afford full protection to labor, local and overseas, organized and 
unorganized, and promote full employment and equality of employment opportunities for all.” 
In fulfilment of these constitutional mandates, this bill seeks to: 
●
Instill protection mechanisms for freelance workers, including the mandatory
provision of a written contract, downpayment of the services, night shift
differential, and hazard pay.
●
Identify unlawful practices in contracting freelance workers and its corresponding
penalties.
●
Lay down the procedures for filing of complaints, investigation, mediation, and its
civil enforcement.
●
Provide tax relief and a special assistance desk to freelancers.
●
Require the Secretary of Labor and Employment to submit a report regarding the
effectiveness of the provisions of the Act and conduct information campaigns
aimed at educating freelance workers about their rights and obligations.
This proposed measure was approved on third and final reading by the House of 
Representatives in the 19th Congress, showing the overwhelming support to institutionalize 
labor protection for Filipino freelance workers.  
1 Serafica, R. B., & Oren, Q. C. A. (2022). Exploring policies and initiatives for online workers in the Philippines. Philippine 
Institute for Development Studies. https://pidswebs.pids.gov.ph/CDN/PUBLICATIONS/pidsdps2201.pdf 
July 16, 2025
11:25 am


In view of the foregoing, the immediate passage of this bill is earnestly sought. 
HON. MIGUEL LUIS R. VILLAFUERTE 
HON. VINCENZO RENATO LUIGI R. VILLAFUERTE 
HON. TSUYOSHI ANTHONY G. HORIBATA 
HON. TERRY L. RIDON 


Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
TWENTIETH CONGRESS 
First Regular Session 
HOUSE BILL NO. 1988 
Introduced by HON. MIGUEL LUIS R. VILLAFUERTE, HON. VINCENZO 
RENATO LUIGI R. VILLAFUERTE, HON. TSUYOSHI ANTHONY G. HORIBATA, AND 
HON. TERRY L. RIDON 
AN ACT PROVIDING PROTECTION AND INCENTIVES TO FREELANCE WORKERS 
Be it enacted by the Senate and House of Representatives of the Philippines in Congress 
assembled:  
CHAPTER I  
GENERAL PROVISIONS 
SECTION 1. Short Title. – This Act shall be known as the “Freelance Workers Protection 
Act.”   
SECTION 2. Declaration of Policy. – Pursuant to Article II, Section 18, and Article XIII, 
Section 3 of the Constitution, it is hereby declared the policy of the State to protect the rights 
of workers, promote their welfare, and ensure their entitlement to humane conditions of work 
and a just share in the fruits of production. To this end, the State shall recognize the right of 
freelance workers to protection from late or nonpayment of fees for services rendered.  
SECTION 3. Definition of Terms. – As used in this Act: 
(a) Freelance worker refers to any natural person or entity composed of  no more than
one (1) natural person, whether incorporated under the  Securities and Exchange
Commission, registered as a sole proprietorship  under the Department of Trade and
Industry (DTI) or registered as self-employed with the Bureau of Internal Revenue
(BIR), who is hired or retained to provide services, in exchange for compensation, as
an  independent contractor to do work according to one’s own methods and  without
being subjected to the control of the hiring party, except only as  to the results of the
work;
(b) Hiring party refers to any person or entity that obtains or retains the services of a
freelance worker; and
(c) Retaliation refers to any act reasonably likely to prevent a freelance worker from being
offered further freelance work and contracts.
SECTION 4. Written Contract. – Any hiring party obtaining or retaining the services of a 
freelance worker shall execute a written contract with the freelance worker before the services 
are rendered. The hiring party and the freelance worker shall each retain a signed copy of the 
contract.  


The contract shall be written in plain language, understood by both parties. It shall 
include, at the minimum, the following:  
 
(a) Itemization of all services to be provided by the freelance worker;  
  
(b) Details of compensation and other workers’ benefits, including rate, method, 
and schedule of payment;   
 
(c) Period of employment;   
 
(d) Grounds for breach of contract on the part of the hiring party and of the 
freelance worker; and   
 
(e) Any other condition, term, or clause that the Department of Labor and 
Employment (DOLE) may direct, subject to the provisions of this Act.   
 
The contract must state the necessary personal circumstances of the freelance worker, 
such as but not limited to the freelance worker’s name, address, and the worker’s Tax 
Identification Number. No modification of the terms of the contract shall be enforceable unless 
signed by both the hiring party and the freelance worker.  
 
SECTION 5. Down Payment. – An initial partial payment for the contracting of services of the 
freelance worker shall be made upon engagement, which shall be not less than thirty percent 
(30%) of the contract price.  
 
SECTION 6. Night Shift Differential. – Freelance workers who are required to be physically 
present in the workplace, or those on field assignments, shall be paid a night shift differential 
of not less than ten percent (10%) of their regular compensation for each hour of work 
performed between ten o’clock in the evening and six o’clock in the morning, unless there is 
a more favorable fee stipulated in the contract.  
 
SECTION 7. Hazard Pay. – All freelance workers deployed in dangerous areas such as strife-
torn or embattled locations, distressed or isolated stations, prison camps, mental hospitals, 
radiation-exposed clinic, laboratories or disease-infested areas, or in areas declared under a 
state of calamity or emergency for the duration of deployment and unduly exposes them to 
great danger, contagion, radiation, occupational risks or perils to life, shall be compensated 
with a hazard pay equivalent to at least twenty-five percent (25%) of the total payment for the 
period of such deployment as agreed upon in the contract, unless there is a more favorable 
fee stipulated therein.  
 
SECTION 8. Unlawful Practices. – It shall be unlawful for any hiring party to:  
  
(a) Engage with a freelance worker without a written contract;   
 
(b) Pay the compensation due the freelance worker later than fifteen (15)  days after the 
date of payment of compensation stated in the written contract or after the rendition of 
services in cases where there is no written contract;   
 
(c) Require as a condition of payment of compensation at any time after a freelance 
worker has commenced rendition of services, that the latter accept less than the 
specified contract price; or  
 
(d) Commit any act of retaliation against any freelance worker for:   
(1) Opposing any practice prohibited by this Act;   
(2) Filing a complaint authorized under this Act;   


(3) Testifying or assisting in any proceeding authorized under this Act;  
(4) Commencing a civil action alleging a violation of this Act;   
(5) Assisting the DOLE in an investigation commenced pursuant to this Act; or 
(6) Providing information to the DOLE pursuant to the terms of a mediation or 
conciliation agreement under this Act.   
 
SECTION 9. Civil Penalty. – A person who commits any of the unlawful practices enumerated 
in Section 8 of this Act shall be punished by a fine of not less than fifty thousand pesos 
(P50,000.00) but not more than five hundred thousand pesos (P500,000.00).  
 
CHAPTER II 
AGENCY ENFORCEMENT AND ADMINISTRATIVE PROCESS  
 
SECTION 10. Complaints. – Any person or such person’s authorized representative 
aggrieved by a violation of this Act may file a complaint with the DOLE, through the 
Undersecretary for Workers with Special Concerns, without prejudice to the filing of civil action 
in appropriate cases.  
 
SECTION 11. Prohibition Against Forum Shopping. – When a civil action has been initiated 
in a court of competent jurisdiction arising from any violation of this Act, a breach  
 
of contract, or any similar claim at law or equity arising out of the same transaction or series 
of transactions, no other case involving the same cause of action shall be filed with the DOLE.  
 
SECTION 12. Investigation. – Upon receiving a complaint alleging a violation of this Act, the 
DOLE shall notify the respondent in writing and investigate such complaint in a timely manner. 
Within fifteen (15) calendar days of receiving such written notification, the respondent shall 
provide the DOLE with a written response and such other information as the DOLE may 
request. The DOLE shall notify each complainant in writing, not less than thirty (30) calendar 
days after the complaint is filed, of the status of the complaint and any resulting investigation.  
 
SECTION 13. Mediation and Conciliation. – The DOLE may, at any time after the filing of a 
complaint, attempt to resolve the complaint by any method of dispute resolution, including 
mediation and conciliation. If a conciliation agreement is entered into, the DOLE shall embody 
such agreement in an order and serve a copy thereof upon all parties to the conciliation 
agreement.  
 
CHAPTER III  
CIVIL ENFORCEMENT   
 
SECTION 14. Notice of Violation and Order of Payment. – If, as a result of an investigation 
of a complaint or an investigation conducted upon its initiative, the DOLE finds cause to believe 
that a violation of this Act has occurred, it shall issue a notice of violation to the respondent 
and order the corresponding payment of compensation due to the prevailing party.  
 
SECTION 15. Violation of Order of Payment. – The order of payment shall include an 
interest rate of six percent (6%) per annum, which shall be awarded to the prevailing party in 
case the violation continues.  
 
SECTION 16. Civil Action. – Except as otherwise provided by law, any person aggrieved by 
a violation of this Act may file a complaint in a court of competent jurisdiction for damages, 
injunctive relief, and such other remedies as may be appropriate, without prejudice to the filing 
of a criminal action in appropriate cases. The prevailing party shall be entitled to an award of 
reasonable attorney’s fees and costs.  
 


No person claiming to be aggrieved by a violation of this Act may bring a civil action in 
a court of competent jurisdiction if such aggrieved person, or one’s representative, has filed a 
complaint with the DOLE pursuant to Chapter II of this Act and based upon the same 
transaction or series of transactions, unless that complaint has been terminated without 
prejudice to a subsequent civil action.  
 
SECTION 17. Non-Waiver. – Except as otherwise provided by law, any provision of any 
contract or agreement purporting to waive rights under this Act is against public policy and 
shall be null and void. 
 
SECTION 18. Coverage. – This Act shall apply only to contracts or agreements entered into 
upon the effectivity of this Act.   
 
CHAPTER IV   
TAXATION   
 
SECTION 19. Tax Relief. – Freelancers, as defined under this Act, shall be entitled to tax 
relief within the threshold provided under the National Internal Revenue Code of  1997, as 
amended, and Republic Act No. 9178, otherwise known as the “Barangay Micro Business 
Enterprises (BMBEs) Act of 2002.”   
 
SECTION 20. Special Assistance. – Every BIR Revenue District Office shall designate a 
lane or a special assistance desk that shall be manned by an officer who shall assist freelance 
workers with their inquiries and in complying with the processing of documents, including the 
registration requirement under this Act.   
 
CHAPTER V   
FINAL PROVISIONS   
 
SECTION 21. Report. – One (1) year after the effectivity of this Act, and every year thereafter, 
the Secretary of Labor and Employment shall submit a report to the Committee on Labor and 
Employment of the House of Representatives and the  Committee on Labor, Employment and 
Human Resources Development of the Senate of the Philippines regarding the effectiveness 
of the provisions of this Act in improving freelance contracting and payment practices. 
Similarly, the DOLE shall submit the report to the Philippine Creative Industries Development 
Council through its Creative Workers’ Welfare Standing Committee. The report shall include, 
at a minimum, the number of complaints received, investigations initiated, and notices issued 
by the DOLE on violations of this Act, and complaints settled by mediation or conciliation.  
 
SECTION 22. Information Campaign. – The DOLE shall, in coordination with the DTI, BIR, 
local government units and other relevant agencies, initiate a program with the objective of 
informing freelance workers of their rights and obligations, the proper procedure of registering 
as a taxpayer, and the modes of legal redress as provided for in this Act, and in other laws 
and regulations.  
 
SECTION 23. Suppletory Application. – The provisions of Republic Act No. 11058, entitled 
“An Act Strengthening Compliance with Occupational Safety and Health Standards and 
Providing Penalties for Violations Thereof,” shall be applied suppletorily to this Act.  
 
SECTION 24. Implementing Rules and Regulations. – Within fifteen (15) days from the 
effectivity of this Act, the Secretary of Labor and Employment shall, in coordination with the 
BIR and other relevant agencies, issue the rules and regulations for the implementation of this 
Act. 
 


SECTION 25. Separability Clause. – If any part, section or provision of this Act is declared 
invalid or unconstitutional, the other provisions not affected by such declaration shall remain 
in full force and effect.  
 
SECTION 26. Repealing Clause. – All laws, decrees, orders, rules, and regulations, or other 
issuances or parts thereof inconsistent with the provisions of this Act are hereby repealed, 
amended or modified accordingly.  
 
SECTION 27. Effectivity. – This Act shall take effect fifteen (15) days after its publication in 
the Official Gazette or in a newspaper of general circulation.  
 
 
Approved,