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Republic of the Philippines

House of Representatives
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TWENTIETH CONGRESS
First Regular Session

House Bill No. 1536
INTRODUCED BY HONORABLE AMADO CARLOS BOLILIA IV
EXPLANATORY NOTE

Article XIII Sec. 3 of the 1987 Philippine Constitution guarantees that the State shall afford
the full protection of labor, local and overseas, organized and unorganized, and promote full
employment and equality of employment opportunities for all. With the advancement of
technology, various types of workers have emerged. Among these are freelance workers who
are considered professionals working on a per contract basis in the current legal framework.
While labor laws exist which protect workers, there is no specific legal regime that regulates
and protects freelance workers in the job market.

Freelance workers experience a unique situation: while they enjoy the freedoms of a
non-traditional work setup such as the freedom to pursue multiple contracts, they are also
‘exposed to various dangers and risks which organized workers are protected from. As it is the
duty of the state to protect workers of all kinds regardless of their employment status, or state
of organization, I file this bill with the intent of establishing a legal regime that shall protect
and uphold the rights of freclance workers against unscrupulous practices and other forms of
harassment they may face. This bill not only secks to provide essential protection, but also
provides incentives to freelance workers so that they may thrive in the highly competitive
industry they are in.

This bill was filed in the 19th Congress as Substitute Bill No. 6781 and successfully passed
3rd reading and was transmitted to the Senate. However, due to lack of material time, it was
not ratified into law.

In view of the foregoing, the immediate enactment and approval of this bill ig earnestly

sought.

AMAD@ CARLOS BOLILIA IV
Representative
4" District, Batangas


Republic of the Philippines

House of Representatives

Quezon City, Metro Manila

TWENTIETH CONGRESS
First Regular Session

House Bill No._ 1536

INTRODUCED BY HONORABLE AMADO CARLOS BOLILIA IV

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 | GENERAL PROVISIONS

SECTION 1. Short Title. — This Act shall be known as the “Freelance Workers
Protection Act.”

SEC. 2. Declaration of Policy. — Pursuant to Article Il, Section 18, and Article XIll,
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 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.

SEC. 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
further being offered freelance work and contracts.

SEC. 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 worker's 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.

SEC. 5. Down Payment. - An initial partial payment for the contracting of services
of the freelance worker shall be made upon engagement, which shail be not less
than thirty percent (30%) of the contract price.

SEC. 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.

SEC. 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.


SEC. 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

(4) 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.

SEC. 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 (50,000.00) but not more than Five hundred thousand pesos
(500,000.00).

CHAPTER II
AGENCY ENFORCEMENT AND ADMINISTRATIVE PROCESS

SEC. 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.

SEC. 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.

SEC. 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.


SEC. 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 Ili
CIVIL ENFORCEMENT

SEC. 14. Notice of Violation and Order of Payment. - If, as a result of an
investigation of a complaint or an investigation conducted upon its own 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.

SEC. 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.

SEC. 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.

SEC. 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.

SEC. 18. Coverage. - This Act shall apply only to contracts or agreements entered
into upon the effectivity of this Act.

CHAPTER IV
TAXATION
SEC. 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.”

SEC. 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 on their inquiries and in complying with the processing of
documents, including the registration requirement under this Act.

CHAPTER V
FINAL PROVISIONS

SEC. 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 shalll include, at the
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.

SEC. 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.

SEC. 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.

SEC. 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 from the
implementation of this Act.

SEC. 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.

SEC. 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.

SEC. 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,