Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS
Second Regular Session

7707

HOUSE BILL NO.

Introduced by: “KUYA” JOSE ANTONIO R. SY-ALVARADO-

EXPLANATORY NOTE

Article II Section 18 of the Constitution provides "The State affirms labor as a
primary social economic force. It shall protect the rights of workers and promote their
welfare." In this light, it is a well-settled policy of the State to give protection to labor
workers and promote their rights, including for the purpose of this bill, right to a just wage.

A just wage includes the right to a full wage which allows an employee to afford
basic physiological needs and security and an income for a satisfactory standard of living.
This should be in accordance with contract stipulations between employer and employee,
the extent of service rendered by the latter, the criterion of credentials, competence or
ability, and deductions as provided by law.

However, it is now becoming a rampant practice, both in public and private
establishments, for salary-disbursing officers to lend money before the actual payment of
salary becomes due, most especially to workers who, in dire need or in cases of emergency,
are forced to borrow from the former to be paid when the salary falls due, usually at usurious
interests. Given this scenario, workers fall prey to the greed of disbursing officers, the effect
of which is detrimental to the well-being of the workers. Hence, there is a need to curb
practice.

In consideration of the foregoing, the passing this bill is earnestly sou;

“KUYA” JOSE Al INIO R. SY-ALVARADO FO

Representative
First District of Bulacan


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City
SEVENTEENTH CONGRESS
Second Regular Session

7707

HOUSE BILL NO.

Introduced by: “KUYA” JOSE ANTONIO R. SY-ALVARADO

AN ACT
PENALIZING THE ACT OF MONEYLENDING WITH INTEREST BY SALARY
DISBURSING OFFICERS IN PUBLIC OR PRIVATE ENTITIES, PROVIDING
PENALTIES FOR VIOLATIONS THEREFOR, AND FOR OTHER PURPOSES

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

SECTION 1. Declaration of Policy - \t is the policy of the State to afford
protection to labor and to protect the rights of workers. Pursuant to this policy, the right of
the worker to receive his full wage is hereby affirmed and protected.

SEC 2. Definition of Terms - As defined in this Act: -

a) Full-Wage - means the net take-home pay of the worker after the
deduction of such charges authorized by law;

b) Salary-Disbursing Officer - refers to a treasurer, finance officer,
accountant, cashier, paymaster and their subordinates or any other person who has
direct or indirect control of the salary of an employee.

SEC 3. Prohibited Acts; Penalties - The following acts are prohibited

a) Any private individual or independent money lending activity made by
the salary disbursing officer with interest or any other consideration;

b) Any deduction privately, individually or independently made by the
salary disbursing officer from the salary of an employee in connection with a loan;

c) The unauthorized withholding of salary by the salary-disbursing officer
because of a loan; and

d) The "buying" of salary or giving or advancing to the employee an amount
less than the full wage. Any salary-disbursing officer who shall commit any of the
prohibited acts mentioned in this section shall suffer a fine of five times the amount
of the salary due the employee and imprisonment for not less than six (6) months.

Any other person who commits similar acts in anyway whatsoever or who acts in
behalf of the salary-disbursing officer shall suffer the same fine and penalty as provided in
the preceding paragraph.


Loans offered by the government and private entities, including bank and company
loans and cooperative credit facilities, and credit assistance by associations, are exempted
from the coverage of this Act.

SEC 4, Separability Clause - If any provision, or part hereof, is held invalid or
unconstitutional, the remainder of the law or the provision not otherwise affected shall
remain valid and subsisting.

SEC 5. Repealing Clause - Any law, presidential decree or issuance, executive
order, letter of instruction, administrative order, rule or regulation contrary to or
inconsistent with, the provisions of this Act is hereby repealed, modified or amended
accordingly

SEC 6. Effectivity Clause~This Act shall take effect fifteen (15) days after its
publication in at least two (2fewspapers of general circulation.

Approved,