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Republic of the Philippines 30 JUN 20%
HOUSE OF REPRESENTATIVE! OATE

Quezon City, Metro Manila TIVE:
By:
SEVENTEENTH CONGRESS i
First Regular Session REGISTRATION UNIT
' BILLS AND INDEX SERVICE

HOUSE BILL No,__226

Introduced by: Hon. Karlo A. B. Nograles AND Hon. Jericho Jonas B. Nograles

EXPLANATORY NOTE

The Constitution mandates that the State shall afford full protection to labor and ensure that
the workers shall be entitled to security of tenure, humane working conditions of work and just
living wages. To pursue this. the Secretary of Labor and Employment under Article 128 of the
Labor Code of the Philippines, as amended, exercises visitorial and enforcement power over
kplaces and worksites to monitor compliance of establishments with labor standards that are
intended to protect workers from hazards in the workplace and promote their welfare by ensuring
safe and healthy work environments.

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Using the 2010 NSO data, a total of 796,698 establishments should be inspected annually as
to comply with the General Labor Standards. However, data from 2007 to 2011 shows that
designated labor-inspectors have been unable to do so given their limited number vis-d-vis the
number of establishments to be inspected. Limitations are also seen in terms of the capacity of labor
inspectors to check compliance with technical safety and occupational safety and health standards.

The DOLE shifted from a regulatory framework to a compliance system in 2012 Crucial to
the change in approach is the creation of a culture of voluntary compliance among companies so
that they effect immediate restitution and correction. This system will also result in fast and fair
settlement of benefits due to workers and in minimizing the issuance of compliance orders that
opens the door to long. tedious, and costly litigations. To reinforce the system, personnel from the
DOLE handling labor law compliance will likewise have to shift from the merely regulatory
approach in inspection to performing developmental tasks, such as educating both employers and
workers on labor laws including those on anti-child labor. conducting conciliation-mediation
proceedings at the plant-level to encourage compliance, and promoting DOLE programs and
services that are aimed at improving working conditions as well as productivity of enterprises

shift. by

amending Article 128 of the Labor Code of the Philippines, from a purely regulatory framework to
the promotion of voluntary compliance through the use of the developmental approach. as &
supplement in order to: (a) inculcate a culture of compliance with labor laws: (b) ensure fair.

In view of the foregoing. it is imperative to institutionalize this major poli

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expeditious, and non-litigious settlement of disputes; (c) encourage the use of settlement in all labor

cases: and (d) strengthen tri-partism among the employees, employers and government.

Hence. passage of this significant measure is earnestly sought.

HON. KARLO A. B. NOGRALES HON. JERICHO/S! iS B. NOGRALES


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

SEVENTEENTH CONGRESS
First Regular Session

9°
HOUSE BILL NO. 726

INTRODUCED BY: Hon. Karlo A. B. NOGRALES AND Hon. Jericho Jonas B. Nograles

AN ACT
FOSTERING A CULTURE OF VOLUNTARY COMPLIANCE WITH LABOR LAWS,
AMENDING FOR THE PURPOSE ARTICLE 128 OF PRESIDENTIAL DECREE NO. 442,
AS AMENDED, OTHERWISE KNOWN AS THE “LABOR CODE OF THE
PHILIPPINES”

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

assembled:
SECTION 1 Article 128 of the Labor Code of the Philippines is further amended to read
as follows:
“ART. 128. Visitorial and Enforcement Power. — (a) The Secretary of

Labor and Employment or his duly authorized representatives[, including labor
regulation officers.} shall have access to employer's EMPLOYMENT records and
premises at any time of the day or night whenever work is being undertaken therein, and

the right to copy therefrom. to question any employee and investigate any fact, condition

or matter which may be necessary to determine violations OF LABOR STANDARDS,
AND OTHER LABOR LAWS AND SOCIAL LEGISLATION or which may aid in
the enforcement of this Code and of any labor law, wage order or rules and regulations

issued pursuant thereto

twithstanding the provisions of Articles 129 and 224 of this Code to the

the

cases where the relationship of employer-employee still exi
Secretary of Labor and Employment or his duly authorized representatives shall have
the power to issue compliance orders to give effect to the Labor Standards Provisions of
this Code, INCLUDING THE EXISTENCE OF AN EMPLOYER-EMPLOYEE
RELATIONSHIP, and other labor legislation based on the findings of THE labor
LAWS [employment and enforcement] COMPLIANCE officers [or industrial safely



engineers] made in the course of inspection. The Secretary or his duly authorized
representatives shall issue writs of execution to the appropriate authority for the
enforcement of [their] orders, except in cases where the employer contests the findings
of the labor [employment and enforcement] LAWS COMPLIANCE officers and raises
issues supported by documentary proofs which were not considered in the course of
inspection.

“A[n] COMPLIANCE order issued by the duly authorized representative of the
Secretary of Labor and Employment under this Article may be appealed to the [latter]
OFFICE OF THE SECRETARY. In case THE said order involves a monetary
award. an appeal by the employer may be perfected only upon the posting of a cash or
surety bond issued by a reputable bonding company duly accredited by the [Secretary of
Labor and Employment] SUPREME COURT OF THE PHILIPPINES in the amount
equivalent to the monetary award in the COMPLIANCE order appealed from.

(c) The Secretary of Labor and Employment OR THE DULY AUTHORIZED
REPRESENTATIVES OF THE SECRETARY may [likewise] order THE stoppage
of work [or suspension of operations] of any unit or department of an establishment
when non-compliance with the law or implementing rules and regulations [poses] MAY
CAUSE OR HAVE CAUSED grave and imminent danger to the health and safety of
workers in the workplace. Within twenty-four hours, a hearing shall be conducted to
determine whether an order for the stoppage of work [or suspension of operations] shall
be lifted or not. In case the violation is attributable to the fault of the employer, he shall
pay the employees concerned their [salaries or] wages AND OTHER LABOR
STANDARDS BENEFITS during the period of such stoppage of work or suspension
of operation,

“(d) It shall be unlawful for any person or entity, INCLUDING GOVERNMENT
AGENCIES AND INSTRUMENTALITIES, to obstruct, impede, delay or otherwise
render ineffective the orders of the Secretary of Labor and Employment or his duly

authorized representatives issued pursuant to the authority granted under this Article,


“THE SECRETARY OF LABOR AND EMPLOYMENT OR THE DULY
AUTHORIZED — REPRESENTATIVES MAY, AFTER — SUMMARY
PROCEEDINGS, IMPOSE A FINE OF NOT LESS THAN ONE HUNDRED
THOUSAND PESOS (P 100,000.00) BUT NOT MORE THAN FIVE. HUNDRED
THOUSAND PESOS (P500,000.00) FOR ANY VIOLATION OF THIS
PROVISION, WITHOUT PREJUDICE TO THE FILING OF APPROPRIATE
CRIMINAL ACTION.

“[(e) Any government employee found guilty of violation of, or abuse of
authority. under this Article shall, after appropriate administrative investigation, be
subject to summary dismissal from the service.]

[f(E) The Secretary of Labor and Employment may. by appropriate regulations,
require employers to keep and maintain such employment records as may be necessary
in aid of his visitorial and enforcement powers under this Code.

“(F)THE SECRETARY OF LABOR AND EMPLOYMENT, IN THE
EXERCISE OF VISITORIAL AND ENFORCEMENT POWER MAY, BY
APPROPRIATE REGULATIONS, ESTABLISH A SYSTEM TO INCULCATE A
CULTURE OF VOLUNTARY COMPLIANCE WITH LABOR LAWS, AND
ENSURE FAIR, EXPEDITIOUS, AND NONLITIGIOUS SETTLEMENT OF
DISPUTES.”

SEC. 2. Presidential Decree No. 442, as amended, otherwise known as the “Labor Code of

the Philippines”. and all other laws, decrees. executive orders, rules and regulations, and other

issuances. or parts thereof inconsistent with the provisions of this Act are hereby repealed, modified

or amended accordingly

SEC. 3. This Act shall take effect fifteen (15) days after its publication in the Official Gazette

or in a newspaper of general circulation.

Approved.