Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

16th Congress
Second Regular Session

House Bill No, 4659

Introduced by. Hon. Karlo Alexei 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 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
workplaces 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.

Using the 2010 NSO data, a total of 769,698 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-a-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.

President Benigno S. Aquino Ill, in his 2012 Labor Day speech, directed
the full implementation of the country’s labor laws, the non-tolerance of
violations and circumventions, and giving workers what are due them under
the law. To implement this Presidential directive, the DOLE shifted from a
regulatory framework to a compliance system, with a strong pro-active and
developmental dimension in enforcing and disposing labor standard cases.
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 this 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.

In view of the foregoing, it is imperative to institutionalize this major
policy 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 a supplement. in order to:
(a) inculcate a culture of compliance with labor laws; (b) ensure fair,
expeditious, and non-litigious settlement of dispute; (c) encourage the use of
settlement in all labor cases; and (d) strengthen tripartism among the
employees, employers and the government

Hence, passage of this significant measure is earnestly sought.

barte

KARLO ALEXEI B. NOGRALES



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

16th Congress
First Regular Session

‘ -
House Bill No. 465

Introduced by. Hon. Karlo Alexei B. Nograles

AN ACT FOSTERING A CULTURE OF VOLUNTARY COMPLIANCE WITH LABOR
LAWS, AMENDING FOR THE PURPOSE ARTICLE 128 OF PRESIDENTIAL DECREE
NO, 422, AS AMENDED, OTHERWISE KNOWN AS THE “LABOR CODE OF THE
PHILIPPINES”

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

SECTION 1. Article 128 of the Labor Code is hereby amended as follows:

“art. 128, Visitorial and enforcement power. - (a) The Secretary of
Labor and Employment or his/HER duly authorized representatives 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 IN THE DETERMINATION OF VIOLATION 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.

(b) Notwithsatnding the provisions of Article 129 and 217 of this Code to
the contrary, the Secretary of Labor and Employment or his/HER duly
authorized representatives shall have the power to issue compliance orders, to
give effect to the labor standards provision of the Code including THE
EXISTENCE OF AN EMPLOYER-EMPLOYEE RELATIONSHIP and other labor
legislation based on the findings of THE LABOR LAWS COMPLIANCE OFFICERS
made in the course of inspection. The Secretary or his/HER duly authorized


representatives shall issue writs of execution to the appropriate authority for
the enforcement of their orders, except in cases where the employer contents
the findings of the LABOR LAWS COMPLIANCE OFFICERS and raises issues
supported by documentary proof which were not considered in the course of
inspection.

A COMPLIANCE order issued by the duly authorized representative of
the Secretary of Labor and Employment under this Article may be appealed to
the OFICE OF THE SECRETARY. In case 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
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 HIS/HER DULY
AUHORIZED REPRESENTATIVES may order THE stoppage of work of any unit or
department of an establishment when non-compliance with the laws or
implementing rules and regulations MAY CAUSE OR 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 shall be lifted or not. In case the violation is
attributable to the fault of the employer, he shall pay the employees
concerned their 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/HER duly authorized representatives issued pursuant to the
authority granted under this Article, and no inferior court or entity shall issue
temporary or permanent injunction or restraining order or otherwise assume
jurisdiction over any case involving the enforcement orders issued in
accordance with this Article.

THE SECRETARY OF LABOR AND EMPLOYMENT OR HIS/HER DULY
AUTHORIZED REPRESENTATIVES MAY, AFTER SUMMARY PROCEEDINGS,
IMPOSE A FINE OF NOT LESS THAN ONE HUNDRED THOUSAND (P 100,000.00)
BUT NOT MORE THAN FIVE HUNDRED THOUSAND (P 500,000.00) FOR ANY
VIOLATION OF THIS PROVISION, WITHOUT PREJUDICE TO THE FILING OF
APPROPRIATE CRIMINAL ACTION.


(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 power under this
Code.

(F) THE SECRETARY OF LABOR AND EMPLOYMENT IN THE EXERCISE OF
HIS/HER VISITORIAL AND ENFORCEMENT POWER MAY, BY APPRORIATE
REGULATIONS, ESTABLISH A COMPLIANCE SYSTEM TO INCULCATE A CULTURE
OF VOLUNTARY COMPLIANCE WITH LABOR LAWS, AND ENSURE FAIR,
EXPEDITIOUS, AND NON-LITIGIOUS SETTLEMENT OF DISPUTES.

(G) ANY MONETARY AWARD GRANTED TO THE EMPLOYEES UNDER THIS
ARTICLE WHICH ARE NOT PAID TO THE SAID EMPLOYEES BECAUSE THEY
CANNOT BE LOCATED AFTER DILIGENT AND REASONABLE EFFORT WITHIN A
PERIOD OF THREE (3) YEARS FROM THE DATE OF NOTICE THEREOF SHALL BE
HELD AS A SPECIAL FUND OF THE DEPARTMENT OF LABOR AND EMPLOYMENT
TO BE USED FOR THE PROMOTION OF COMPLIANCE WITH LABOR
STANDARDS.”

SEC. 2 Implementing Rules and Regulations. - The Department of Labor and
Employment shall issue the necessary rules and regulations for the effective
implementation of this Act.

SEC. 3 Repealing Clause. - Presidential Decree No. 442, as amended, otherwise
known as the “Labor Code of the Philippines”, and all other acts, laws, decrees,
executive orders, proclamations, rules and regulations or any part thereof,
which are inconsistent with the provisions of this Act, are hereby repealed or
modified accordingly.

SEC. 4 Effectivity. — This Act shall take effect after fifteen (15) days from the
date of its publication in the Official Gazette or in at least two (2) newspapers
of general circulation.

Approved,