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

EIGHTEENTH CONGRESS
First Regular Session

3951

House Bill No.

Introduced by Rep. Christopher V.P. De Venecia

EXPLANATORY NOTE

Freelancing is slowly becoming a way of life in the Philippines, especially in the advent of
the internet and online freelance job portals. In Freelancer.com alone, an online platform for
freelancing jobs and crowd sourcing marketplace for entrepreneurs, there is an estimated
800,000 Filipino users. Majority of our artists - actors, writers, singers, dancers, composers,
directors — are also freelancers due to the nature of their jobs.

In fact, more and more freelancers are becoming “multi-hyphenates,” or persons with
hyphenated professions, e.g. singer-songwriter, actor-director, because of the competitive nature
of freelance jobs and the higher cost of living. Another factor adding to the multi-hyphenate
freelance phenomenon is the entry of millennials into the workforce. According to an article
published by Time Magazine, millennials are those born from 1980 to 2000; when they were born,
technology was already available. Growing up with access to so many things has, it seems, made
them want to be everything at the same time; however, it is the same access that gives them the
confident entrepreneurial spirit to pursue their passions fearlessly. Thus, they can’t be
constrained by traditional labels and don’t relate to traditional systems of employment.

One of the biggest drawbacks of a Filipino freelancer is the non-payment for services
rendered. More often than not, the freelancer does not pursue any course of action to demand
payment for lack of remedial channels, fear of retribution, or lack of resources to pursue legal
action.

Furthermore, many freelancers are not registered with the Bureau of Internal Revenue. It
is important to account for this income-generating sector so that they may contribute to the
country's tax revenue. Likewise, in light of dangerous circumstances confronted by some
freelancers, it is imperative that freelancers be provided adequate mandatory hazard pay.

This measure aims to promote the safety and well-being of freelancers, specifically, by
mandating the provision of mandatory hazard pay and night shift differential pay. The bill further
gives freelancers the power to demand payment for services rendered through several legal
channels, impose civil penalties on unscrupulous hiring parties, and criminalize non-payment of
compensation of freelancers.

In view of the foregoing, the approval of this bill is earnestly sought

0

REP. CHRISTOPHER V.P. DE VENECIA
Fourth pistritt, Pangasinan



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

EIGHTEENTH CONGRESS
First Regular Session

3951

House Bill No.

Introduced by Rep. Christopher V.P. De Venecia

AN ACT
PROVIDING PROTECTION AND INCENTIVES FOR FREELANCERS

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

CHAPTER |
GENERAL PROVISIONS

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

SEC. 2. Declaration of Policy. — Pursuant to Section 18, Article |I and Section 3, Article
XIII of the 1987 Constitution, it is hereby declared the policy of the State to protect the rights
of workers, local and overseas, organized and unorganized, promote their welfare, and ensure
their entitlement to humane conditions of work and a living wage. Towards this end, the State
shall recognize the right of freelancers to protection from late or non-payment for services
rendered

SEC. 3. Definition of Terms. — As used in this Act, the following terms shall mean:

a) Department refers to the Department of Labor and
Employment.

b) Freelancer refers to any natural person or entity composed of
no more than one natural person, whether incorporated under
the Securities and Exchange Commission (SEC), registered as a
sole proprietorship under the Department of Trade and
Industry (DT), or registered as self-employed with the Bureau
of Internal Revenue (BIR), who is hired or retained as an
independent contractor by a hiring party to provide services in
exchange for compensation.

©) Hazardous Work refers to services performed by a freelancer
which expose him or her to hazards likely to cause any disabling
injury, illness, death or physical or psychological harm.


d) Hiring Party refers to any person or entity who retains a
freelancer to provide any service.

e) Retaliation refers to any act reasonably likely to prevent a
freelancer from further being offered freelance work and
contracts.

SEC. 4. Required Written Contract. — Any hiring party retaining the services of a
freelancer shall execute a written contract with such freelancer before said services are
rendered, The hiring party and the freelancer shall each retain a copy thereof.

SEC, 5, Contents of the Written Contract. — The contract shall be written in plain
language and in a language understood by both parties. The contract shall include, at a
minimum, the following details:

a) Itemization of all services to be provided by the freelancer;
b) Method of compensation;
c) Rate of compensation;

d) Date/s of payment of compensation, or the mechanism by
which such date/s of payment will be determined;

e) Grounds for breach of contract on the part of the hiring party
and of the freelancer; and

f) Any other conditions, terms or clauses that the Department
may direct.

No modification of the terms of the contract shall be enforceable unless signed by
both the hiring party and the freelancer.

SEC. 6. Night Shift Differential. — Freelancers 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 his or her regular wage for each hour of work performed
between ten o'clock in the evening and six o'clock in the morning.

SEC. 7. Grant of Hazard Pay. — All freelancers deployed in difficult areas, strife-torn or
embattled areas, distressed or isolated stations, prison camps, mental hospitals, radiation-
exposed clinics, laboratories or disease-infested areas or in areas declared under state of
calamity or emergency for the duration thereof which expose them to great danger,
contagion, radiation, occupational risks or perils to life, shall be compensated hazard pay
equivalent to at least twenty-five percent (25%) of the total payment agreed upon in the
contract for the duration of such deployment.


SEC. 8, Unlawful Practices, — |t shall be unlawful for any hiring party to:

a) Pay the compensation due the freelancer later than thirty (30)
days after the date/s of payment of compensation stated in the
written contract, or after the rendition of services in cases
where there is no written contract, except as otherwise
provided by law;

b) Require as a condition of payment of compensation, at any
time after a freelancer has commenced rendition of services,
that a freelancer accept less than the specified contract price;
and

©) Commit any acts of retaliation against any freelancer or person
for:

i.) Opposing any practice prohibited by this Act;
ii.) Filing a complaint authorized under this Act;

iii.) Testifying or assisting in any proceeding authorized
under this Act;

iv.) Commencing a civil action alleging a violation of this
Act;

v.) Assisting the Department in an_ investigation
commenced pursuant to this Act; or

vi.) Providing information to the Department pursuant
to the terms of a mediation or conciliation
agreement under this Act.

SEC. 9. Criminal Penalty. ~ Any person found guilty by the court to have committed
any of the unlawful acts provided under the preceding section shall suffer the penalty of
imprisonment of one (1) month and one (1) day to six (6) months and a fine of not less than
the amount of the contract price plus interest and not more than twice such amount,

CHAPTER II
AGENCY ENFORCEMENT AND ADMINISTRATIVE PROCESS

SEC, 10, Complaints. ~ Any person aggrieved by a violation of this Act, or such person’s
authorized representative, may file a complaint with the Regional Office of the Department
having jurisdiction over the place where the services were rendered without prejudice to the
filing of a criminal action in appropriate cases.

SEC, 11, Jurisdiction. — A complaint against a hiring party shall be filed with the
Department.


SEC, 12. 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 Department.

SEC. 13, Investigation, - Upon receiving a complaint alleging a violation of this Act,
the Department shall notify the respondent in writing and investigate such complaint in a
timely manner. Within fifteen (15) days of receiving such written notification, the respondent
shall provide the Department with a written response and such other information as the
Department may request. The Department shall notify each complainant in writing, not less
than thirty (30) days after the complaint is filed, of the status of the complaint and any
resulting investigation.

SEC. 14, Mediation and Conciliation. — The Department 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
Department shall embody such agreement in an order and serve a copy thereof upon all
parties to the conciliation agreement.

SEC. 15. Notice of Violation and Order of Payment. ~ \f, as a result of an investigation
of a complaint or an investigation conducted upon its own initiative, the Department 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, 16. Other Relief. — The Department may include in the Order of Payment
appropriate relief to the prevailing party, including but not limited to damages, attorney's
fees, costs, and any other equitable relief.

SEC. 17. Violation of Order of Payment. — The Order of Payment shall include the
appropriate penalties for violation of an order pursuant to this Act, which shall be a penalty
of an amount of not less than Fifty Thousand Pesos (P50,000) but not more than Five Hundred
Thousand Pesos (P500,000) and an additional penalty of Five Thousand Pesos (P5,000) for
each day that the violation continues, to be awarded to the prevailing party.

CHAPTER III
CIVIL ENFORCEMENT

SEC. 18. Civil Action. — Except as otherwise provided by law, any person claiming to be
aggrieved by a violation of this Act has a cause of action to 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 his/her representative, has filed
a complaint with the Department pursuant to Chapter I! 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. 19, Civil Penalties, — Any person found to have violated this Act or any rule or
regulation promulgated thereunder is liable for a civil penalty of an amount of not less than
Fifty Thousand Pesos (P50,000) but not more than Five Hundred Thousand Pesos (P500,000).

SEC. 20. Non-Waiver. ~ Except as otherwise provided by law, any provision of any
contract or agreement purporting to waive rights under this Actis void for being against public
policy.

SEC. 21. Coverage. - This Act shall apply only to contracts or agreements entered into
on or after the effectivity of this Act.

CHAPTER IV
TAXATION

SEC. 22. Taxpayer Registration. — All freelancers as defined under this Act shall be
required to register with the Bureau of internal Revenue (BIR).

SEC, 23. Taxpayer Service. ~ Every BIR Revenue District Office (RDO) shall have a lane
or aspecial assistance desk dedicated to freelancers. This lane shall have an officer who shall
assist freelancers in their application, registration, processing of documents and other
inquiries.

SEC, 24, Filing and Payment. — Except as otherwise provided by law, all freelancers
must pay their income taxes annually.

SEC. 25. Implementing Rules and Regulations. - Within sixty (60) days from the
effectivity of this Act, the Department, in coordination with the BIR and other relevant
agencies, shall promulgate the necessary rules and regulations from the implementation of
this Act.

SEC. 26. Separability Clause. — Should any provision herein be declared
unconstitutional, the same shall not affect the validity of the other provisions of this Act.

SEC. 27, Repealing Clause. — All laws, decrees, orders, rules, and regulations, or others
issuances or parts thereof inconsistent with the provisions of this Act are hereby repealed,
amended or modified accordingly.

SEC. 28. Effectivity. — This Act shall take effect fifteen (15) days after its complete
publication either in the Official Gazette or in at least two (2) newspapers of general

circulation.

Approved,