FIFTEENTH CONGRESS )
OF THE REPUBLIC OF THE PHILIPPINES )
First Regular Session )

HOUSE OF REPRESENTATIVES,

House Bill No__1894

Introduced by Representative Ben P. Evardone

EXPLANATORY NOTE.

‘A huge portion of any company's success is attributable to the toils and
dedication of its workers. Frankly speaking, without labor, a firm will not be able to
produce anything at all. It, however, goes without saying that without businesses,
or is simply just an unutilized resource and therefore cannot obtain any benefit,
This therefore implies that both agents should be working on the same side, both
eyeing a common goal of maximizing their welfare through cooperation,

To this end, the 1987 Phitippine Constitution mandates the State to regulate
the relations between workers and employers, recognizing the right of labor to its
just share in the fruits of production and the right of enterprises to reasonable return
on investments, and to its expansion of growth (Par 4, Section 3, Article XIII). In
line with this, the proposed measure seeks to grant workers in the private sector an
annual productivity incentive bonus; which shall be equivalent to not less than ten
percent (10%) of net profits before taxes gained by their respective companies. By
providing such an incentive, the workers will feel that their productivity is
function of their income, thus pushing them to increase their contribution to their
companies’ production.

Agents in an economy respond and work according to the incentives they are
facing. By providing incentives that will enjoin agents to maximize their capacities,

+ thereby expanding the country's aggregate production, the country will be able to
enjoy the benefits of increased economic activities such as improved accessibility of
goods and services in the market as well as rising quality of |

In view of the foregoing, the immediate passage of this bill is earnestly

sought
wk “ARDONE

Representative, Lone District of Eaatern Samar



FIFTEENTH CONGRESS )
OF THE REPUBLIC OF THE PHILIPPINES )
First Regular Session )

HOUSE OF REPRESENTATIVES

House BillNo. F894

Introduced by Representative Ben P, Evardone

AN ACT
GRANTING AN ANNUAL PRODUCTIVITY INCENTIVE TO ALL
WORKERS IN THE PRIVATE SECTOR, ESTABLISHING MECHANISMS
FOR ITS IMPLEMENTATION, AND FOR OTHER PURPOSES

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

SECTION |. Title. - This Act shall be known as the “Workers Productivity
Incentives Act of 2010.”

SEC. 2. Statement of Policy. - It is hereby declared the policy of the State to
continuously empower the Filipino workers in their continuing struggle to uplift and
improve their lives through policies that effectively contribute to greater economic
gains, protection of their rights and advancement of their welfare. The State shall,
therefore, promote the rights of workers in their just and fair share in the profits
from the production of goods and services in all endeavors where their labors and
expertise are employed by virtue of a management-labor/employer-employee
relation,

SEC. 3. Extent of Grant. -- All workers in the private sector regardless of their
employment status and not excluded by this Act shall be granted an annual
productivity incentive bonus which shall be equivalent to not less than ten percent
(10%) of net profits before taxes gained by any company or business establishment
for every fiscal year that engages their labor, skills and expertise for any period or
duration, provided that they have worked for at least one month during the calendar
year. If the employee worked for only a portion of the year, the productivity
incentive bonus shall be computed pro rata.

SEC. 4, Rule Making Power - The Department of Labor and Employment, in
consultation with the National Wages and Productivity Commission, Bureau of
Internal Revenue, and representatives from the labor and employer sectors shall
Promulgate and issue within six (6) months from the effectivity of this Act such
rules and regulations as are necessary to implement the provisions hereof!

SEC.5. Non-diminution of Benefits. - Nothing in this Act shall be construed to
diminish or reduce any benefits and other privileges enjoyed by the workers under
existing laws, decrees, executive orders, company policy or practice, or any
agreement or contract between the employer and employees.

SEC. 6. Unlawfal interference or restraint. - It shall be unlawful for an employer or
labor union or for any government official or employee and any other business
enterprise or entity to interfere with, restrain or coerce employees in the right to
receive this grant and to require as a condition of employment that the employee
shall, not collect this grant in his favor.

SEC. 7. Exemptions. - The provisions of this Act shall not apply to government
‘owned and controlled corporations with original charters; managerial employees;
house helpers; non-resident aliens; workers who are paid by results as determined



by the Secretary of Labor in appropriate regulations and those employees or workers
in companies or enterprises undergoing receivership/liquidation. Applications for
exemption strictly in accordance with those exempted employers, enterpri
establishments herein stated shall be duly filed with the Office of the Regional
Director of the Department of Labor and Employment (DOLE) whose decision can
be appealed to the DOLE Secretary within ten (10) days from its promulgation,

SEC. 8. Compliance Order. - All Regional Directors of the DOLE shall issue an
annual compliance order for the payment of the grant as provided for in this Act.
The order shall, among other things, direct the employer or manager to pay the
amount due each worker or employee, thirty (30) days after the end of every fiscal
year and shall also include the computation on which the order was based.

SEC. 9. Penalties. - Any person, corporation, trust, firm, partnership, association or
entity which refuses or fails to pay the herein prescribed grant in accordance with
this Act shall be directly liable to the affected worker for thrice (3x) the accrued
grant plus moral damages not exceeding thirty thousand pesos (P30,000.00) for each
affected worker and imprisonment of not less than one (1) year nor more than two
(2) years and including the costs of litigation and attorney's fees.

If the violation is committed by a corporation, trust or firm, partnership,
association or entity the penalty of imprisonment shall be imposed on the entity's
responsible officers. If the violation is committed by a foreign individual, he/she
shall be summarily deported under applicable laws after complete satisfaction of his
adjudged liabilities.

SEC, 10, Separability Clause. - If any provision of this Act shall be declared
unconstitutional, any other provision not affected thereby shall remain in full force
and effect.

SEC. 11. Repealing Clause. - All laws, decrees, orders, rules and regulations, or
parts thereof inconsistent with this Act are hereby repealed or amended accordingly.

Teetivity. - This Act shall take effect fifteen (15) days after its
at least two (2) newspapers of general circulation.

SEC. 12,
publication

Approved,