Republic of the Philippines
HOUSE OF REPRESENTATIVES
Constitution Hills, Quezon City

EIGHTEENTH CONGRESS
First Regular Session

HOUSE BILL No. __ 4584

Introduced by
REPRESENTATIVE PANTALEON D. ALVAREZ

AN ACT
ENSURING THE EMPLOYEES’ RIGHT TO THEIR WAGES,
INCLUDING WAGE-RELATED SOCIAL SECURITY AND WELFARE
BENEFITS, AMENDING FOR THE PURPOSE PRESIDENTIAL
DECREE NO. 442, AS AMENDED, OTHERWISE KNOWN AS THE
LABOR CODE OF THE PHILIPPINES

EXPLANATORY NOTE:

This bill seeks to curb the illegal practice of private sector employers
of non-compliance with the proper and appropriate payment of
minimum wage to their workers.

It is stated in the Constitution that the State is mandated to protect
the rights of laborers and promote their welfare. Among the primary
entitlements of a worker should be afforded is his monthly income, which
he will be needing to provide for his day-to-day family and personal
expenditures.

When it comes to wages, the Regional Tripartite Wages and
Productivity Board (or the Regional Wage Boards) imposes the minimum
wage in their respective regions and employees in the Philippines must
be paid no less than the specified rates. In the case of NCR, for instance,
the minimum wage is Php 537.00 per day.


Aside from wages, basic entitlements of employees also include,
among others, the right to receive wage-related benefits through the
coverage under the Social Security System, Philippine Health Insurance
Corporation, and the Home Development Mutual Fund (also known as
PAG-IBIG Fund). These wage-related benefits are also essential to ensure
the social and economic security of workers.

Failure to pay the required minimum wage entails penalties.
However, the current penalties are not strong enough to completely stop
these unjust and unreasonable conditions suffered by workers.

Workers are the “company’s greatest asset”, according to
businesswoman Anne Mulcahy, and these assets should receive the right
wages and benefits they so deserve. This bill seeks to increase the
penalties so as to impose stricter guidelines for the employers. In doing
so, this could serve as a deterrent to the non-compliance of the payment
of prescribed minimum wage rates by unjust employers.

The approval of this bill is earnestly sought.

PANTALEON VAREZ


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Constitution Hills, Quezon City

EIGHTEENTH CONGRESS
First Regular Session

HOUSE BILLNo.__ $564 _

Introduced by
REPRESENTATIVE PANTALEON D. ALVAREZ

AN ACT
ENSURING THE EMPLOYEES’ RIGHT TO THEIR WAGES,
INCLUDING WAGE-RELATED SOCIAL SECURITY AND WELFARE
BENEFITS, AMENDING FOR THE PURPOSE 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. A new article, denominated as Article 97-A, is hereby
inserted after Article 97 of Presidential Decree No. 442, as amended,
otherwise known as the Labor Code of the Philippines, to read as follows:

“ARTICLE 97-A. SOCIAL SECURITY AND WELFARE
BENEFITS - UPON EMPLOYMENT, EVERY EMPLOYEE SHALL
BE COVERED BY THE SOCIAL SECURITY SYSTEM (SSS), THE
PHILIPPINE HEALTH INSURANCE CORPORATION
(PHILHEALTH), THE HOME DEVELOPMENT MUTUAL
FUND (PAG-IBIG FUND), AND OTHER SOCIAL SECURITY
AND WELFARE BENEFITS. NOTWITHSTANDING ANY
PROVISION OF LAW TO THE CONTRARY, ALL PREMIUM
PAYMENTS OR CONSTRIBUTIONS FOR SUCH BENEFITS OF

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MINIMUM WAGE EARNERS SHALL BE SHOULDERED BY
THE EMPLOYER.”

SEC. 2. Article 102 of the Labor Code is hereby amended, to read as
follows:

“Art. 102. Forms of payment. - No employer shall pay the
wages AND WAGE-RELATED BENEFITS of an employee by
means of promissory note, voucher, coupons, tokens, tickets, chits,
or any object other than legal tender, even when expressly
requested by the employee.

THE PAYMENT OF THE WAGES AND WAGE-RELATED
BENEFITS OF AN EMPLOYEE SHALL BE MADE THROUGH
AUTOMATED TELLER MACHINES (ATM) OF BANKS.”

SEC. 3. A new article, denominated as Article 105-A, is hereby
inserted after Article 105 of the Labor Code, to read as follows:

“SRT. 105-A. NON-PAYMENT OF WAGES AND BENEFITS;
PENALTIES - NON-PAYMENT OF THE WAGES OF
EMPLOYEES, INCLUDING WAGE-RELATED BENEFITS, IS
HEREBY DECLARED UNLAWFUL.

ANY PERSON, CORPORTATION, TRUST, FIRM,
PARTNERSHIP, ASSOCIATION OR ENTITY THAT REFUSES
OR FAILS TO PAY THE WAGES OF AN EMPLOYEE FOR
SERVICE RENDERED, OR REFUSES OR FAILS TO PAY ANY
OF THE PRESCRIBED INCREASES OR ADJUSTMENTS IN
THE WAGE RATES MADE IN ACCORDANCE WITH
PREVAILING LAWS SHALL BE PUNISHED BY A FINE OF
NOT LESS THAN TWO HUNDRED THOUSAND PESOS
(P200,000.00) NOR MORE THAN FIVE HUNDRED THOUSAND
PESOS (P500,000.00) AND/OR IMPRISONMENT OF NOT LESS
THAN FOUR (4) YEAR NOR NOT MORE THAN SIX (6) YEARS
OR BOTH SUCH FINE AND IMPRISONMENT AT THE
DISCRETION OF THE COURT.

THE EMPLOYER CONCERNED SHALL BE ORDERED
TO PAY AN AMOUNT EQUIVALENT TO DOUBLE THE

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UNPAID WAGES OWING THE EMPLOYEE: PROVIDED,
THAT THE PAYMENT OF INDEMNITY SHALL NOT
ABSOLVE THE EMPLOYER FROM THE CRIMINAL
LIABILITY IMPOSABLE UNDER THIS ARTICLE.

IF THE VIOLATION IS COMMITTED BY A
CORPORATION, TRUST, FIRM, PARTNERSHIP,
ASSOCIATION, OR OTHER ENTITY, THE PENALTY OF
IMPRISONMENT SHALL BE IMPOSED ON THE ENTITY’S
RESPONSIBLE OFFICERS UNDER THE CIRCUMSTANCES,
WHICH MAY INCLUDE BUT NOT LIMITED TO, THE HUMAN
RESOURCES MANAGER, FINANCE MANAGER, THE
PRESIDENT, VICE-PRESIDENT, CHIEF EXECUTIVE OFFICER,
GENERAL MANAGER, MANAGING DIRECTOR OR
PARTNER.

ANY ALIEN FOUND GUILTY SHALL BE SUMMARILY
DEPORTED UPON COMPLETION OF SERVICE OF
SENTENCE AND/OR PAYMENT OF THE APPROPRIATE FINE.

ANY PERSON CONVICTED UNDER THIS ACT SHALL
NOT BE ENTITLED TO THE BENEFITS PROVIDED FOR
UNDER PRESIDENTIAL DECREE NO. 958, OTHERWISE
KNOWN AS THE PROBATION LAW OF 1976.”

SEC. 4. Article 106 of the Labor Code is hereby amended, to read as
follows:

“Art. 106. Contractor or subcontractor. - Whenever a{n]
PRINCIPAL employer enters into a contract with another person
for the performance of the former’s work, the employees of the
contractor and of the latter’s subcontractor, if any, shall be paid in
accordance with the provision of this Code.

In the event that the contractor or subcontractor fails to pay
the wages AND WAGE-RELATED BENEFITS, INCLUDING
THE PREMIUMS FOR SOCIAL SECURITY AND WELFARE
BENEFITS, of his employees in accordance with this Code, the
PRINCIPAL employer shall be jointly and severally liable with the
contractor or subcontractor to such employees to the extent of the

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work performed under the contract, in the same manner and extent
that he is liable to employees directly employed by him.

There is ‘labor-only’ contracting where the person supplying
workers to an employer does not have substantial capital or
investment in the form of tools, equipment, machineries, work
premises, among others, and the workers recruited and placed by
such persons are performing activities which are directly related to
the principal business of such employer. In such cases, the person
or intermediary shall be considered merely as an agent of the
employer who shall be responsible to the works in the same manner
and extent as if the latter were directly employed by him.”

SEC. 5. Implementing Rules and Regulation. - The Secretary of Labor
and Employment shall promulgate the necessary implementing rules and
regulations within one hundred and twenty (120) days from the
effectivity of this Act.

SEC. 5. Separability Clause. - If any provision of this law or the
application thereof to any person or circumstance is held invalid, the
remainder of this law or the application of such provision or part to other
persons of circumstances shall not be affected thereby.

SEC. 5. Repealing Clause. - All laws, decrees, rules, and regulations
or parts thereof, which are contrary to or inconsistent with this Act, are
hereby repealed or modified accordingly.

SEC. 8. Effectivity. - This Act shall take effect fifteen (15) days after
its publication in the Official Gazette or in a newspaper of general

circulation.

Approved,

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