FOURTEENTH CONGRESS OF THE 
) 
REPUBLIC OF THE PHILIPPINES 
) 
First Regular Session 
1 
S. No. 15 
Introduced by HONORABLE JUAN MIGUEL F. ZUBlRl 
EXPLANATORY NOTE 
This bill seeks to provide a Magna Carta for the Workers in the Informal 
Sector. 
The Informal Sector includes micro-entrepreneurs like ambulant vendors, fish 
vendors, small-scale farmers and fisherfolk; and the employed and self-employed 
consisting of local domestic helpers or kasambahay, barbers, manicurists, 
pedicurists, pedicab or trisikad, tricycle drivers, jeepney drivers, taxi drivers, 
carpenters, plumbers, electricians, masons, house painters, welders, and mechanics. 
They are indispensable for making many commodities and services affordable for the 
rest of society. 
Comprising almost half of the total workforce, the Informal Sector (IS) 
accounts for 113 of the country's non-agricultural Gross Domestic Product as shown 
in a ten-year study conducted from 1994-2003. Likewise, the IS sector share in 
employment at more than 15 million jobs is on the rise, according to the Department 
of Labor and Employment. 
Despite the large economic contribution of IS workers, the protection of their 
rights and welfare remains largely neglected not only in the Philippines but also in 
many countries where increasing numbers of Filipinos work. It is such that the 
international Labor organization selected the Philippines to the ILO's Action Program 
on Decent Work. 
Longer hours of work, insecurity, lower incomes and hazardous working 
conditions characterize activities in the sector. According to the ILO, the sector is 
"highly heterogeneous [or diverse], encompassing production units of different 
features, and in a wide range of economic activities, as well as people (workers, 
producers, employers) working or producing under many different types of 
employment relations, and productive arrangements." 
Likewise, the National Statistical Coordination Board (NSCB) recognized that 
"labor relations in the IS, where they exist, are based on casual employment, kinship 
or personal and social relations rather than formal or contractual arrangements." 
Thus, the workers are vulnerable to many forms of exploitation or abuse. 
They are mostly poor who live in sordid conditions, achieve low level of 
education and lack formal certification of their marketable skills. Thus, they end up 
being hired to work for lower wages and in substandard conditions. Among them poor 
ventilation and lighting, cramped space, lack of appropriate sanitary facilities for work 
and personal hygiene, lack of protection from hazardous exposure to chemicals. 


This Magna Carta will empower the Informal Sector in the hope that they can 
escape the economic rut to which many are trapped. It also aims to promote their 
welfare through social security, protection from occupational hazards and providing 
access to mechanisms to redress their grievances. 
By instituting this Magna Carta, the State will finally recognize the real 
economic value of their labor and extend them the dignity that workers strive for. 
In view hereof, approval of this bill is earnestly requested 


FOURTEENTH CONGRESS OF THE 
1 
First Regular Session 
1 
REPUBLIC OF THE PHILIPPINES 
) 
SENATE 
S. N 0 . 1 5 8 5  
Introduced By Honorable JUAN MIGUEL F. ZUBlRl 
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AN ACT 
PROVIDING FOR A MAGNA CARTA FOR THE WORKERS IN THE INFORMAL 
SECTOR, INSTITUTIONALIZING MECHANISM FOR IMPLEMENTATION 
THEREOF AND FOR OTHER PURPOSES 
Be it enacted by the Senate and House of Representatives of the Philippines 
in Congress assembled: 
TITLE I 
GENERAL PROVISIONS 
Chapter I 
Framework and Principles 
SECTION 1. Shod Title. This Act shall be known as the "Magna Carta for the 
Workers in the Informal Sector." 
SEC. 2. Declaration of Policy. It is hereby declared the policy of the State: 
(a) To promote and improve the total well-being of the poorest-of-the-poor and 
the marginalized low level income earners who engaged in economic activities under 
the informal sector; 
(b) To nurture and protect the interests of the informal sector by providing with 
adequate and timely social, economic and legal services, as well as mechanisms that 
shall protect their rights and promote benefits that ensure their dignified existence 
and economic advancement; 
(c) To recognize the rights of every worker in the informal sector, to protect 
them, especially women and children, from abuse, economic exploitation and from 
performing work that is hazardous to their physical, mental and spiritual health; 
Toward this end, the State shall come up with an integrated, holistic and 
comprehensive policy instrument for the informal sector that will facilitate: 
(1) the enhancement of their entrepreneurial skills and their capabilities to 
become more productive and self-reliant thereby ensuring their protection, 
assistance, support and participation in the mainstream economic activities; and 
(2) a continuing process of consultation and dialogue with said sector to be 
able to maximize the provision of a systematic package of reform intervention 
services. 
SEC. 3. Framework and Principles. The government shall pursue a minimum 
regulation and encourage the development of ingenuity and the entrepreneurial spirit 
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among the citizenry. In this regard, the LGUs and their respective attached agencies 


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shall see to it that procedural rules and requirements for the IS are minimized in the 
act of registration, availment of financing, grants and other incentives and accessing 
other government services and assistance. 
In order to hasten the growth and expansion of the various business activities 
or enterprises under the informal sector, the private sector shall be encouraged to 
assist in the effective implementation of this Act by participating in government 
programs for the informal sector. In this regard, the DTI, in consultation with the 
concerned government agencies, the LGUs and the informal sector, may recommend 
simplified procedure and localized incentives for the benefit of the informal sector. 
The government shall encourage the organization, establishment, strengthening and 
expansion of the various business activities or enterprises under the informal sector 
in the barangay level preferably unified under a municipallcity, provincial, regional 
and national federationlassociation. 
SEC. 4. Definition of Terms. As used in this Act, the following terms shall 
mean: 
(a) Daily Basis refers to the per day mode of paying a private worker as 
bilaterally agreed upon by both the employer and the worker. 
(b) Employer refers to a natural person or group or partnership of people for 
which a paid worker renders productive employment or service. 
(c) Hazardous work or condition refers to any activity or circumstance where a 
worker is exposed to any risk which constitutes an imminent danger to.his/her health 
and safety. 
(d) Kasambahay refers to any person, whether male or female, who is to be 
engaged, is engaged or has been engaged locally in a salaried capacity under a full- 
time basis and paid directly by the employer, undertaking tasks ascribed as normal 
household chores within a specific household. The term includes maids, cooks, 
houseboys, family drivers and babysitters (yaya) who provide daily service to a single, 
specific household, either on a live-in or live-out basis. In common term, kasambahay 
is called household helper. 
(e) Worker of minor age refers to children fifteen (15) years up to seventeen 
(17) years of age who are engaged in productive employment under a valid contract 
of employment. 
(f) lnformal Secfor, which is herein otherwise referred to as IS, refers to a 
category of individuals or partnerships of people involved in any business activity or 
enterprise whose total assets value, inclusive of the capital investments, must not be 
more than Ten Thousand Pesos (Pl0,OOO.OO) for single proprietorship and Twenty- 
five Thousand Pesos (P25,OOO.OO) for partnership ventures andlor whose annual 
income must not exceed Thirty-five Thousand Pesos (P35,OOO.OO) and One Hundred 
Fifty Thousand Pesos (PI 50,000.00), respectively. 
The above definition shall be subject to review and adjustment upon the 
recommendation by the Regional Wage Board (RWB), .in consultation with the 


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National Economic Development Authority (NEDA) motu propio taking into account 
inflation and other economic indicators. 
(9) Monthly Basis refers to the per month mode of paying a private worker as 
bilaterally agreed upon by both the employer and the worker. 
(h) Pacquiao Basis refers to the pre-contracted wholesale mode of paying a 
private worker as bilaterally agreed upon by both the employer and the worker. 
(i) Self-employed worker refers to any person, whether male or female, who is 
to be engaged, is engaged or has been engaged locally and paid directly by the 
homeowner/employer to provide services to either a single or a number of 
households on a contractual or day-to-day basis. The term includes gardeners, 
laundry women and household helpers hired on a day-to-day basis, provided that 
they do not report for work to a single household for four (4) days a week or more, 
else they shall be classified as kasamabahay. 
(j) Worker refers to a general term to mean either or both the self-employed or 
(k) Working hours refers to the period of time within which a worker is required 
to be on call to perform any and all tasks that may be designated, regardless of 
whether there are actual tasks being undertaken. 
Chapter II 
Coverage, Qualifications and Accreditation 
paid employee covered under the provisions of this Act. 
SEC. 5. Registration; Payment. IS business activities or enterprises shall, 
upon registration, pay Fifty pesos (P50.00) to the municipality or city where they 
intend to be productively employed during their initial year of operation. The said fee 
shall cover the cost of the issuance of the license to operate. 
SEC. 6. Annual Dues. IS business activities or enterprises shall pay the fee to 
the municipal or city treasurer where they are registered and accredited, starting on 
their second year of operations, based on the following schedule: 
(a) Those with net assets before financing amounting to not more than 
P 2,000.00. . . . 
P 
180.00 
(b) Those with net assets before financing of more than P 100,000.00 to 
P 2,000.00 to 5,000.00 . . . . 
P 
360.00 
(c) Those with net assets before financing of more than P400,OOO.OO to 
The collected fee shall accrue exclusively to the municipality or city and shall 
P 7,500.00 to 10,000.00. . . . 
P 
720.00 
be used for IS development programs approved by the municipal or city council. 
SEC. 7. Revocation of Business Authority. The authority to do business shall, 
after due notice and hearing, be revoked and cancelled upon the failure of the IS 
business activities or enterprises, without valid reasons, to commence its operations 
within forty-five (45) days from receipt of the authority to operate. 
SEC. 8. Coverage. This Act shall cover members of the informal sector who 
are operating, employed or working either as micro-entrepreneur, paid worker or self- 
employed as defined herein. 
Provided, however, That the aforesaid rnicro- 
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entrepreneur, paid worker or self-employed qualifies the minimum requirements set 
forth in this Act. 
For purposes of this Act, the term "informal sector" shall cover the following: 
(a) Micro-entrepreneurs: 
(i) sidewalk vendors, fish vendors; 
(ii) small scale farmers and fisherfolks; 
(b) EmployedlSelf-Employed: 
(i) local domestic helpers or kasambahay: 
(ii) barbers, manicurists, pedicurists; 
(iii) pedicab/tricycle drivers; 
(iv) jeepney drivers ; 
(v) taxi drivers ; 
(vi) carpenters, plumbers, electrician, mason, house painters; 
(vii) welders, mechanics 
SEC. 9. Accreditation. Any member of the IS who meets such eligibility, 
qualification and other necessary requirements as provided for under this Act shall be 
accredited as member of the IS. 
Accreditation for eligibility for any development program shall be reviewed, 
revalidated and reassessed every two (2) years from the date of last accreditation by 
the LGUs where the IS operates. Renewal of eligibility shall be based in accordance 
with the merit and fitness principle. 
SEC. 10. Eligibility for Benefits. The selection and appointment of 
beneficiaries under this Act shall be in accordance with the merit and fitness principle: 
Provided, That the applicant is an accredited member of the IS, as prescribed herein. 
Only accredited member shall be eligible for assistance, support and grants under 
this Act. 
Chapter 111 
Special Allocations for Development Initiatives 
SEC. 11. Special Allocations for Development Initiatives The national 
government shall allocate at least ten (10%) percent of its annual national budget to 
be appropriated proportionately in accordance with the corresponding internal 
revenue allocation (IRA) of respective LGUs. Such allocation shall be annually added 
to the current IRA of LGUs. 
The said allocation shall be utilized by LGUs for the implementation of 
livelihood programs pursuant to the provisions of this Act. Priority shall be given to 
income generating programs for the poorest-of-the-poor. The emphasis of the 
programs shall be focused on micro-credit programs and schemes through the 
mobilization of the IS with no assets to engage in self-employment and income 
generating activities. 
For this purpose of this Chapter, an Informal Sector Development Fund shall 
be established in every citylmunicipality for the their supervision and management 
subject to accounting and auditing procedures by the Commission on Audit (GOA). 
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SEC. 12. Sourcing and Adopfing Development Initiatives. The Small Business 
Guarantee and Finance Corporation (SBGFC), which is created under Republic Act 
No. 8289, shall assist in the sourcing and adopting of development initiatives for 
competitive enterprises in terms of finance, technology, production, management and 
business linkages, and provide and promote, develop and widen in both scope and 
service reach various alternative modes of financing for IS business activities or 
enterprises, including but not limited to, direct and indirect project lending, venture 
capital, financial leasing, secondary mortgage and/or rediscounting of loan papers to 
IS business activities or enterprises, and crop production financing. 
The Corporation shall guarantee loans obtained by qualified IS worker or 
business activity or enterprise, whether single proprietorship or a partnership venture, 
under such terms and conditions adopted by its Board. It shall become liable under 
its guarantees upon proof that the loan has become past due under such terms and 
guidelines adopted by its Board and printed on the contract of guarantee. 
All provisions stipulated under R.A. No. 8289 in connection with the SBGFC 
shall continue to effect except those which are deliberately changed or amended 
hereof. 
SEC. 13. Eligibility for Government Assistance. To qualify for assistance, 
incentives and grants, a worker or business activity or enterprise shall be: 
(a) duly registered and accredited with the appropriate agency in the LGU 
where they are actively operating and paid the necessary fees for registration and 
accreditation from the office of the municipal or city treasurer-concerned; 
(b) one hundred percent (100%) owned and capitalized by Filipino citizens, be 
(c) fall under the above-mentioned sub-categories of IS; 
SEC. 14. Exclusivity of Government Programs. The government shall ensure 
that programs of financing, grants and other similar incentives shall be exclusively 
extended to an accredited IS worker and business activity or enterprise. 
SEC. 15. Entitlement of Government Procurements. The government shall 
work for a mechanism to ensure that duly accredited IS worker or business activity or 
enterprise for an entitlement of a share of at least ten percent (10%) of total 
procurement value of goods and services supplied to the government, its bureaus, 
offices and agencies annually: Provided, That prices and quality of goods offered by 
the above-mentioned accredited IS worker or business activity or enterprise are 
competitive. 
it single proprietorship or a partnership venture; and 
SEC. 16. Coordination with LGUs. Pursuant to the provisions of Republic Act 
No, 7160, the local chief executives in coordination with IS representatives and 
appropriate agencies shall formulate specific plans that will address the socio- 
economic needs of the IS and incorporate them in their respective provincial, city and 
municipal development plans. 
SEC. 17. Tax ,Exemption. A duly accredited IS worker or business activity or 
enterprise shall be exempted from all taxes, national or local, license and building 
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permit fees and other business taxes, except real property and capital gains taxes, 
import duties and other taxes on imported articles. In addition, any and all income, 
receipts and proceeds derived from their business operations shall be excluded for 
the computation of gross income for purposes of computing the individual income tax 
of the members thereof. 
It shall be exempted from any and all government rules and regulations in 
respect of assets, income, and other activities indispensably and directly utilized in, 
proceeding from or connected with the IS business or the enterprise. 
SEC. 18. Forfeiture of Benefits. All the exemptions and other benefits herein 
provided shall, after due notice and hearing, be forfeited in case of any violation of the 
provisions of this Act by any IS member or partnership venture. 
SEC. 19. lnclusivify of Benefits. The exemptions and other benefits provided 
in this Act shall apply for a period not exceeding five (5) years from the date of the 
registration, provided such IS worker or business activity or enterprise is registered 
and accredited within five (5) years from the effectivity of this Act. 
Chapter IV 
Informal Sector Development Council 
SEC. 20. Creation of an lnformal Sector Development Council; Mandate. 
There is hereby created an Informal Sector Development Council, herein otherwise 
referred to as the Council, which shall be attached to the DTI and shall be constituted 
within sixty (60) days after the approval of this Act. 
The Council shall be the primary agency responsible for the promotion, growth 
and development of the IS in the country by way of facilitating and closely 
coordinating national efforts to promote the sector's viability and growth, including the 
provision of an integrated program for skills enhancement, literacy and education, 
health services, social welfare and services, assistance in the tapping of local as well 
as foreign funds, and other functions relative to the attainment of the objectives and 
policy of this Act. 
SEC. 21. Composition. The Council shall be headed by the Secretary of the 
DTI as Chairman, and may elect from among themselves a Vice-chairman to preside 
over the Council meetings in the absence of the Chairman. The members shall be 
the following: 
(a) Director General of the NEDA 
(b) Secretary of DA; 
(c) Secretary of DOLE; 
(d) Secretary of DSWD; 
(e) Secretary of the DOH 
(f) Secretary of DOT; 
(9) Administrator of the NHA; 
(h) Administrator of the CDA; 
(i) Chairman of Small Business Guarantee and Finance Corporation; 
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0) Three (3) representatives from the private sector at large, all Filipino 
citizens, to represent Luzon, Visayas and Mindanao; and 
(k) One (1) representative from the informal sector to be appointed by the 
President. 
An ex officio member of the Council who possesses a cabinet-rank shall 
designate an undersecretary or assistant secretary as hidher permanent alternate 
representative in case helshe fails to attend meetings in the exigency of hislher 
official function in the department. 
The private sector members of the Council shall be entitled to receive per 
diem of Two Thousand Pesos (P2,OOO.OO) per meeting. The Council shall meet once 
every two months or it may call for special meetings as the need may arise: Provided, 
That the frequency of such special meetings shall not exceed four (4) times annually. 
The DTI shall allocate Ten million pesos (PlO,OOO,OOO.OO) out of its savings 
for the initial operating expenses of the Council, after which the Council's budget shall 
be included in the department's annual appropriation. 
SEC. 22. Mandate of the Council. The Council shall have the following 
mandate: 
(a) Prepare and establish a System of Accreditation for the IS in accordance 
(b) Provide guidelines for the implementation by the LGUs of a fair and 
credible system of evaluation, accreditation, review and assessment, merit promotion, 
rendering of grants and incentive awards and other policies relative to the effective 
implementation of this Act; 
(c) Prepare a program of training for human resource development, including 
(d) Coordinate with LGUs for the development and implementation of periodic 
evaluation of all accredited IS members -- taking into account their accomplishments, 
capabilities and potentials -which 
results of shall be used as bases for evaluation, 
accreditation, the grant of awards and incentives, training and retraining; 
with the standards and provisions of this Act; 
the specific areas of entrepreneurship and business management: 
(e) Establish a performance appraisal system for all accredited IS members 
which shall be the basis for incentives, rewards and recognition, training and 
development, including adequate mechanisms that shall ensure their active 
participation and involvement; and 
(f) Establish the criteria and process for the accreditation and renewal of such 
eligibility for development assistance, support and grants. 
SEC. 23. Authority of the Counci/ to Solicit Assistance from Various Agencies. 
The Council may, from time to time, call upon the participation of any government 
agency or bureaucracy in its deliberations especially when such agency is directly or 
indirectly concerned with andlor affecting the growth and development of the IS in 
any particular area or manner. 
The Council, further, may create an Executive Committee of five (5) members 
elected by the Council from among themselves or their duly designated alternate 
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representatives, with at least two (2) members representing the private sector, and 
with authority to act for and on behalf of the Council during intervals of meetings, and 
within the specific authority granted by the Council. 
SEC. 24. Council Secretariat. The Council, through the Chairman, shall 
designate, in his capacity as secretary of the DTI, any division or bureau within the 
DTI to act as the Council Secretariat and shall have the following duties and 
functions: 
(a) To prepare, in coordination with LGUs and other local government 
agencies, and recommend annual as well as medium-term IS Enterprise 
Development Plans for the approval of Council: 
(b) To coordinate the preparation of position papers and background 
materials for discussion or approval during Council meetings; 
(c) To assist the Council in coordinating and monitoring the policies, programs 
and activities of all government agencies with respect to the 
implementation of this Act; 
(d) To prepare, collate, integrate all inputs to the Council's yearly report on the 
status of the IS business activities or enterprises in the country; 
(e) To submit periodic reports to the Council on the progress and 
accomplishment of its work programs; and 
(f) To perform ad hoc functions as authorized by the Council. 
SEC. 25. Rafionalizafion of Programs. The Council shall conduct continuing 
review of government programs for the poorest-of-the-poor and the IS and submit to 
Congress and the 
President a report thereon together with 
its 
policy 
recommendations. 
The President is hereby empowered to establish, within ninety (90) days upon 
the effectivity of this Act, an informal sector enterprise promotion body which shall be 
the principal government agency that will formulate, implement, coordinate and 
monitor all non-financing government programs, including fee-based services, to 
support and promote entrepreneurial spirit among the poorest-of-the-poor. 
The 
informal sector enterprise promotion body shall be attached to the DTI and shall be 
under the policy, program and administrative supervision of the Informal Sector 
Development Council. The said office shall be allocated the amount of Ten million 
pesos (PlO,OOO,OOO.OO) for its first year of operation which shall be appropriated from 
the special fund of the Office of the President, and thereafter its annual appropriation 
shall be included in the General Appropriations Act. 
Heads of LGUs in the provincial, city and municipal levels are further 
empowered to establish in their respective jurisdiction an Informal Sector Division or 
Bureau, under the office of the Provincial Governor or CitylMunicipal Mayor, 
whichever is applicable, to implement, coordinate and monitor all business activities 
or enterprises and intervene on IS-related problems and concerns under their 
respective jurisdictions. 
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Chapter V 
IS Livelihood Resource Center 
SEC. 26. IS Livelihood Resource Center. The IS Livelihood Resource Center 
shall be established in every cityhunicipality to enhance access of assistance and 
support to disadvantaged members particularly in remote rural areas. 
For this purpose, the DTI. Technical Education and Skills Development 
Authority (TESDA) and Technology and Livelihood Resource Center (TLRC) shall 
develop livelihood programs which will harness the skills of the IS members. 
The aforesaid agencies shall conduct human resource development program 
and management in the following areas: 
(a) Adequate facilities and resources to render quality social service; 
(b) Opportunities for IS workers to grow and develop their potentials and 
experience a sense of worth and dignity in their work; 
(c) Mechanisms for democratic consultations; 
(d) Upgrading of working conditions; 
(e) Allocation of funds for the participation of IS workers in skills training and 
workshops and other similar activities as part of their continuing advancement: and 
SEC. 27. Functions of IS Livelihood Resource Center. The IS Livelihood 
Resource Center shall have the following functions: 
(a) Conduct training program which will provide new ideas to IS players and 
upgrade the technical and entrepreneurial skills of others who are already in the field; 
(b) Implement consciousness-raising capability building and leadership 
(c) Provide technical support and access credit to the informal sector engaged 
training; 
in micro-entrepreneurship and cottage industries or other productive work: 
(d) Monitor the performance of the IS in the area 
(e) Give advise and recommendations as to the strengthening and expansion 
of the IS activities; and 
(f) Provide services, to include but not limited to counseling, legal assistance, 
credit assistance, and other services necessary for the furtherance of this Act. 
The LGUs shall allocate at least P 100,000.00 annually for the operation and 
The local chief executives shall act as the primary 
maintenance of the Center. 
overseers to the overall operation of the Center. 
Chapter VI 
IS Comprehensive and Integrated Plan 
and Inter-Agency Networking 
SEC. 28. comprehensive Plan. The NEDA shall be tasked to formulate a Ten- 
Year Comprehensive and Integrated Plan on the impact of globalization to the IS. It 
shall determine and recommend the necessary safety nets needed by the IS to 
prepare them for the possible effects of globalization. 
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SEC. 29. Inter-Agency Networking. The DOLE shall provide for and lead the 
inter-agency 
networking 
system 
among 
the 
different 
departments 
and 
instrumentalities of government, should the same be required in the continuing efforts 
to protect the interests, rights and privileges of IS workers. 
The Council, in coordination with the DECS and CHED, shall design a 
comprehensive and integrated program for IS members to give them opportunity to 
pursue free education. 
The cooperatives through the help of the DTI, TESDA and TLRC shall inform 
IS in the rural of opportunities for market and technology access and the availability of 
livelihood training and seminars to respond to IS needs and potentials. 
The DSWD shall, within a period of one (1) year from the date of effectivity of 
this Act, institute a program designed specifically to provide emergency services 
specifically to women and the minor-aged IS workers who are in need of custody, 
shelter, healing, or medical, psychological, legal and rehabilitative services. 
The DSWD shall, upon the recommendation of the DOLE, effect the 
repatriation of minor-aged IS workers who either voluntarily seek government 
protection against abuse and exploitation or upon report or discovery of the same. 
The cost of such repatriation shall be borne by the DSWD. The DOLE shall formulate 
the rules and regulations governing the emergency repatriation of the same. 
For this purpose, a Repatriation Fund is hereby created and established under 
the administration and control of the DSWD in the amount of Five million pesos 
(P5,000,000.00) to be taken from the President's Social Fund. 
Chapter VI1 
General Rights 
SEC. 30. Basic Rights. Every member of the IS have the right to: 
a) Participate in all spheres of society including the decision-making 
processes to fully realize their role as agents and beneficiaries of people-centered 
development; 
b) Be treated equally before the law; 
c) Be provided with safe and healthful conditions in the workplace; 
d) Be given equal access to education, skills training, and economic resources 
to develop their self-reliance; 
e) Be properly informed of the issues and concerns affecting the welfare and 
interests of their sector; 
f) Be protected from any form of discrimination, violence, sexual exploitation 
and abuse. 
SEC. 31. Right to Medical Care and Humane Treatment. Every worker has a 
right to good quality health care, without any discrimination and within the limits of the 
resources available for health and medical care. In the course of such care, his 
human dignity, culture, convictions and integrity shall be respected. 
The employer or any member of the household or institution shall, at all times, 
In no instance shall abusive 
treat his/her worker in a just and humane manner. 
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language, physical violence or any act which debases, degrades or demeans the 
intrinsic worth and dignity of the worker as a human being be used upon the latter. 
SEC. 32. Right to Organize. The State recognizes the right of IS workers to 
organize themselves to promote their welfare and advance or safeguard their 
interests. Towards this end, the government shall assist IS especially in the rural 
areas in establishing self-help organizations. 
IS engaged in agricultural, manufacturing and service sector are encouraged 
to form women's cooperatives in every citylmunicipality to enable members to avail of 
credit assistance and skills training which will help improve their quality of life. 
Chapter Vlll 
Benefits and Incentives 
SEC. 33. Medica//Hea/fh Insurance. A worker, regardless of age and 
compensation levels, shall be covered by a free medicallhealth insurance under the 
Philippine Health Insurance Corporation (PHILHEALTH), and be entitled to all the 
benefits provided for under the law: Provided, however, That the worker has rendered 
at least one (1) year of continuous service in the employment helshe is currently in: 
Provided, further, That if the worker intends to have a medicallhealth insurance 
during hislher the initial months of hislher employment, helshe shall shoulder all the 
necessary premiums due himlher until the seventh (7th) month when the employer 
shares fifty (50%) percent of the monthly required premiums. 
For purposes of this Section, The PHILHEALTH shall, within ninety (90) days 
from the effectivity of this Act, promulgate guidelines for the mechanism of collecting 
the aforesaid contributions especially for those contracted workers who are employed 
on daily, monthly or pacquiao basis. The PHILHEALTH is hereby mandated to 
implement an outreach program that will facilitate the remittance of premiums by 
either the employer or the worker by whatever means deemed feasible. 
Pending the promulgation of pertinent implementing rules and regulations to 
this effect, the employee shall receive the employers' share or counterpart 
contribution and may remit said amount together with hislher own share to the SSS. 
SEC. 34. Social Security Coverage. A worker, regardless of age and 
compensation levels, shall be covered by social security and be entitled to all the 
benefits provided under Republic Act No. 8282: Provided, however, That the worker 
has rendered at least one (1) year of continuous service in the employment helshe is 
currently in: Provided, furfher, That if the worker intends to become a member of the 
SSS or intends to continue hislher social security contribution during hislher the initial 
months of hislher employment, helshe shall shoulder all the necessary premiums due 
himlher until the seventh (7th) month when the employer shares fifty (50%) percent of 
the monthly required contribution. 
For purposes of this Section, The SSS shall, within ninety (90) days from the 
effectivity of this Act, promulgate guidelines for the mechanism of collecting the 
aforesaid premiums especially for those contracted workers who are employed on 
daily, monthly or pacquiao basis. The SSS is hereby mandated to implement an 
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outreach program that will facilitate the remittance of premiums by either the 
employer or the worker by whatever means deemed feasible. 
Pending the promulgation of pertinent implementing rules and regulations to 
this effect, the employee shall receive the employers' share or counterpart 
contribution and may remit said amount together with hisher own share to the SSS. 
Chapter IX 
Institutional Mechanisms 
SEC. 35. Consultations with IS Organizations. The Informal Sector 
Development (ISD) Council, in coordination with other concerned agencies and 
LGUs, shall conduct annual national, regional and provincial consultations among the 
IS organizations to determine the specific issues and problems affecting the their 
sector. The Council shall channel IS concerns to the appropriate agencies and 
provide the 
necessary recommendations to the executive and legislative 
departments. 
SEC. 36. Establishment of IS Database. The Council shall establish and 
develop a centralized database system to effectively work policy formulation and 
policy concerns relative to the IS. The databank shall include but not limited to the 
following: 
a) List of government and non-governmental organizations which provide 
educational, socio-economic and legal services to the IS; 
b) Inventory of upheld and pending cases involving the IS activities; 
c) Statistical profile of the various IS classified according to activities, 
involvement and other statistical information: 
d) Database of the needs and problems of women and children in the IS 
nationwide; and 
e) Compilation of existing laws and programs affecting the interest and welfare 
of the IS. 
The public shall be allowed to have access to the said data provided that they 
shall abide with the regulations that will be set by the inter-agency committee. 
Chapter X 
Benefits to Participating Private Sector 
SEC. 37. Incentives to Private Sector. The national government shall 
implement a mechanism which shall give incentives and benefits to private sector 
organizations participating in a national effort to advance the interest and welfare of 
the IS. 
The Department of Finance in coordination with the Bureau of Internal 
Revenue shall promulgate guidelines for the effective implementation of this Section. 
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TITLE I I  
IS WORKERS ENTERING INTO CONTRACTED EMPLOYMENT 
Chapter I 
Requisites for Contracting Employment 
SEC. 38. Employment Contract. All working arrangements entered into by IS 
workers shall be covered by a written employment contract, in a language or dialect 
understood by both employer and worker, duly signed by both the employer and the 
worker. Under this Act, the employer and the worker may enter into either one of the 
following three (3) working arrangements: Daily Basis, Monthly Basis, or Pacquiao 
Basis. 
In every contract entered into each contracting party shall be provided with a 
full set of the duly signed employment contract, the basic provisions of which shall 
include the following: 
(a) working arrangementlmode; 
(b) period/duration of employment; 
(c) compensation and mode of payment; 
(d) computation of contributions for social security and medical insurance: 
(e) computation of leave deductions; 
(f) duties and responsibilities; 
(g) working hours and day-off schedule; 
(h) living quarters or sleeping arrangements (for live-in workers) 
In cases wherein employment of a worker of minor age are allowed, the said 
employment contract shall be signed on hislher behalf by either parent or legal 
guardian, with the expressed written consent of said minor. 
In cases wherein employment of illiterate worker are allowed, the said 
employment contract shall be explained to the worker concerned and attested to by a 
representative from the LGU or an elected Barangay official in the city or municipality 
where the worker is designated to work. 
SEC. 39. Medical Certificate as Pre-requisite for Employment. A medical 
certificate attesting to the physical and mental fitness of an applicant for work must be 
secured from a licensed physician as a pre-requisite for employment, the cost of 
which shall be for the account of the employer. 
Chapter II 
IS Workers of Minor Age 
SEC. 40. Allowable Employment of Worker of Minor Age. Children below 
sixteen (16) years of age may be employed: Provided, That a parental consent be 
presented and attested by any representative from the LGU or duly elected barangay 
official where the productive employment is to be done: Provided, further, That the 
provisions of the UN Convention on the Worst Forms of Child Labor be taken into 
consideration in the course of employing such children. 
In no instance, however, shall children below fifteen (15) years of age be 
engaged in whatever form of productive service. 
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Unless expressly employed as kasambahay with duly executed contract of 
employment, children who live with their parents at the employer's residence or those 
whose sustenance or education is being provided for by the homeowner, shall not be 
considered as kasambahay. 
Workers of minor age shall not be allowed to render work for more than ten 
(IO) hours a day, five (5) days per week, exclusive of one (1) hour breaks each for 
breakfast, lunch and dinner. 
SEC. 41, Custody over Minor-aged individual. Should a minor-aged worker 
refuse to be repatriated against the recommendation of the DSWD, said individual 
may be placed under the custody and care of the DSWD or that of a duly recognized 
and accredited non-government organization, or placed in a suitable employment. 
Chapter Ill 
Standardized Wage Rate 
SEC. 42. Standardized Wage Rate. Pursuant to the provisions of this Act, a 
standardized wage rate is hereby set forth: 
For Kasambahay 
(a) 4'h - 6Ih class municipalities 
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Below P I  ,000.00 
(b) 1' - 3rd class municipalities & 
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P 1,001 .OO - P 1,800.00 
Chartered & Component Cities 
(c) National Capital Region 
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PI, 801.00 - P 2,500.00 
For Employed Worker 
(a) 4'h - 6Ih class municipalities 
Skilled:P 90.00 - P 120.00 
Unskilled: 
P 60.00 - P 80.00 
(b) 1"- 3'' class municipalities & Chartered & Component Cities 
Skilled:P 130.00 - P 180.00 
Unskilled: 
P 90.00 - P 120.00 
(c) National Capital Region 
Skilled:P 230.00 - P 260.00 
Unskilled: 
P 190.00 - P 220.00 
Provided, That a worker who has been contracted work in other 
citylmunicipality other than the place of residency shall be entitled for the daily wage 
rate of the citylmunicipality where he/she actually works: Provided, further, That a 
worker who has contracted employment outside the city/municipality of residency 
shall be afforded free assistance and support in the form of housing and food by the 
contractor/employer. 
In the case of a worker who works on monthly or pacquiao basis, the wage 
rate to be applied shall be based in the wage rate of the city/rnunicipality where 
helshe actually works. Helshe shall also be afforded free housing and support during 
the tenure of the contract. 
In no instance, however, shall workers of minor age be deprived of the above 
standardized wage rate system set forth in this Act. 
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SEC. 43. Payment of Wages. Payment of wages shall be made directly to the 
worker, at least once every two (2) weeks or twice a month. No deductions from said 
wages shall be made by the employer except those provided by law. The expressed 
written consent of the worker shall first be secured before any deduction is made. 
Chapter IV 
Prohibited Acts 
SEC. 44. Prohibition Against Night Work. Worker of minor age shall not be 
allowed to render work between ten o'clock in the evening and six o'clock in the 
morning of the following day. 
SEC. 45. Prohibition Against Work to be Undertaken. Worker of minor age 
shall not be allowed to render work beyond their mental and physical capabilities. 
SEC. 46. Prohibition Againsf Bonded Labor. A worker shall not be allowed to 
use his/her future services as collateral for any loan or advances made or to be made 
by said worker with the employer. Likewise, no employer shall be allowed to bind the 
worker to hidher continued employ as a form of payment for any loan or advances 
which helshe may have made with the employer. Should there be an outstanding 
loan incur and helshe decides to unilaterally terminate the contract of employment, 
said loan or advance shall be paid by himlher to the employer under terms and 
conditions specified in a duly executed promissory note between parties. 
SEC. 47. Prohibition Against Labor Sub-Contracting. In no instance shall the 
employer sub-contract the services of a worker to any third party, unless such activity 
falls within the purview of an employment arrangement for which the necessary 
permits and licenses had been priorly secured. 
SEC. 48. Prohibition Against Recruitment and Finders Fees. Regardless of 
whether the worker was sourced either through an employment agency or a third 
party, said worker shall neither be charged nor levied a share in the recruitment fees 
or finder's fees by the aforementioned employment agency or third party. 
SEC. 49. Prohibition Against Hazardous Work and Conditions. Worker of 
minor age shall not be employed in any hazardous work, activity or undertaking, and 
neither shall he/she be exposed to hazardous working conditions. 
For purposes of this Section, hazardous work or conditions shall include, but 
not limited to the following: 
(a) any work, employment or activity which exposes the worker to physical, 
emotional or sexual abuse; 
(b) any work which involves manual handling or transport of heavy loads; 
(c) any work in an unhealthy environment which exposes household helpers to 
hazardous substances, agents or processes, or to temperatures, noise levels, or 
vibrations damaging to their health; 
(d) any work which requires the household helper to render services for long 
periods of time or during late nights; 
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(e) any or all forms of slavery or practices similar to slavery, such as the sale 
and trafficking of household helpers, forced or compulsory labor, debt bondage and 
serfdom; 
(f) any use, procuring or offering of the household helper for prostitution or 
pornography; 
(g) any use, procuring or offering of the household helper for the commission 
of any offense or crime, particularly for the production and trafficking of narcotic drugs 
and substances as defined in the Dangerous Drugs Act; 
(h) any other type of work or activity which, by its nature or the circumstances 
in which it is carried out, is likely to jeopardize the health, safety or morals of the 
household helper; and 
(i) any other type of work; activity, condition or undertaking that may be 
hereinafter be defined as hazardous by the Department of Labor and Employment. 
SEC. 50. Prohibition Against lnterference and Coercion. Any person is 
prohibited from committing any of the following acts of interference and coercion: 
(a) To prevent a worker from upholding hidher other basic rights; 
(b) To prevent workers from joining or assisting organizations or unions for 
purposes not contrary to law, in order to defend and protect their mutual interest and 
to obtain redress of grievances through peaceful concerted efforts; 
(c) To prevent a worker from carrying out hidher duties and functions in an 
organization or union, or to penalize the same for any lawful action performed in that 
capacity; 
(d) To make calculated harassment and interference with the intention of 
intimidating or preventing the social worker from performing hislher duties and 
functions; 
(e) To make calculated harassment against, or to transfer, penalize or 
terminate the services of a worker who is carrying out hislher function or role for and 
in behalf of hislher employer; and 
(9) To perform acts calculated to diminish the independence and freedom of a 
social worker's union or organization to direct its own affairs. 
Chapter V 
Rights and Benefits of Employed IS Workers 
SEC. 51. Right to Wages Earned. The employer shall pay directly to the 
worker of minor age, any and all wages, remuneration or compensation earned by 
himlher during the period of hislher employment. 
No parent, guardian or relative shall be allowed to borrow against the 
compensation of the hislher relative-worker of minor age without the express written 
consent of the concerned relative-worker. Neither shall the worker of minor age be 
mandated to work in payment of a loan or liability incurred by a parent, guardian or 
relative. 
SEC. 52. Right to Privacy and Confidentiality. The employer shall respect the 
privacy of hidher worker during the course of the latter's rest periods. This right to 
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privacy shall extend to any and all forms of personal communications, including 
letters of correspondence issued or received, and be allowed communications 
coursed through the private telephone of the employer: Provided, That any additional 
expense incurred in the course of communication shall be borne by the worker and 
shall be deducted, after the employer's due notice to the worker of the amount 
incurred due to specific reasonis, from the receivable wage of the worker. 
The State, further, guarantees the protection of the right of the worker to 
communicate with relatives and other persons and to receive visitors subject to 
reasonable limits prescribed in the employment contract agreed and entered into by 
both the employer and the worker. 
The employer shall allow the worker access to outside communication, both 
though letter or the private telephone of the household, especially in instances of 
personal or family emergencies: Provided, that costs incurred in making the 
telephone call shall be for the account of the worker. 
SEC. 53. Access to Educafion and Training. A worker shall not be deprived of 
formal or non-formal education. In cases where helshe is productively employed, 
helshe shall be allowed to attend or pursue literacy programs during day-off or in any 
other time with the consent of the employer. 
The DECS or CHED, whichever office is applicable, shall extend its services 
of Study-Now, Pay-Later Program to the worker in the informal sector. 
The employer may also extend scholarship programs to a worker and be 
reimbursed out of deductions from the worker's monthly compensation which shall, at 
all times, be no greater than fifty (50.0%) percent of the worker's monthly 
compensation. The time spent by a worker during the conduct of the said education 
or training, including the time spent going to and coming from the training shall be 
counted as part of the worker's hours of work. 
SEC. 54. Access to Lawful Third-party Mediation. The employer shall provide 
all worker the names, addresses and telephone numbers of the designated liaison 
offices of the following: 
(a) DTI; 
(b) DOLE; 
(c) the Barangay office where he/she is productively working; and, 
(d) duly registered non-government organizations accredited to mediate in 
The employer shall further guarantee the worker access to all means of 
communication for the purpose of contacting any of the above-enumerated 
institutions. 
disputes of their sector. 
SEC. 55. Provision of Basic Necessities. The employer shall provide for the 
basic necessities of a live-in worker which shall include: 
(a) A minimum of three (3) full meals per day; 
(b) Humane, private and safe sleeping quarter; 
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(d) A safe and non-health hazard workplace; 
In no instance shall the employer be allowed to withdraw or hold in abeyance 
the provision of these basic necessities as punishment or disciplinary action to be 
meted out to the worker. 
SEC. 56. Normal Hours of Work. Cognizant of the peculiarities of the 
relationship between the employer and the IS worker, the normal hours of work shall 
be set at ten ( I O )  hours per day, exclusive of one (1) hour breaks each for breakfast, 
lunch and dinner. The worker shall be allowed at least eight (8) hours of continuous 
rest per day otherwise any work done by himlher beyond the normal hours of work 
per day shall be duly compensated. 
SEC. 57. Regular Working Days. No worker shall render work for more than 
six (6) days per week. While the specific day of the week set aside as rest day for the 
worker may be stipulated in the employment contract, the same may be changed for 
another day of the week upon the mutual agreement of the employer and the worker 
as the exigencies of the work may dictate. 
SEC. 58. Longevitypay. A longevity pay equivalent to five per centum (5%) of 
hidher latest monthly basic pay shall be paid to a worker for every two (2) years of 
continuous and satisfactory service rendered. 
SEC. 59. Clothing Allowance. A worker shall be entitled to a minimum of One 
Thousand pesos (PI ,000.00) clothing allowance annually: Provided, That the worker 
has rendered at least one (1) year of continuously service in the employment he/she 
is currently in. 
SEC. 60. Vacafion Leaves. A worker who is employed for one (1) year shall 
be entitled to a fourteen (14) day vacation leave with pay, in addition to the one (1) 
day per week designated as the rest day. Said leave may only commence at the end 
of the first year of employment, and shall not cumulate from year to year. 
SEC. 61. Maternity Benefits. A female worker who is employed for one (1) 
13" Month Pay. A worker shall be entitled to a 13'h month pay 
equivalent to one (1) month's basic salary which shall be paid to the worker not later 
than the 16Ih of December of every year: Provided, however, That the worker has 
reached the required minimum residency. Otherwise, the worker shall be entitled to 
receive a 13Ih Month Pay on pro-rated basis. 
SEC. 63. Allowing subconfracfing. A worker may enter into subcontractual 
employment or may accept subcontractual jobs from any other enterprise or firm 
joining or may join productive employment through a cooperative or consortium: 
Provided, however, That the enterprise or firm or cooperative or consortium shall be 
mandated to implement the specific provisions of this Act in regard to worker's 
benefits: Provided, further, That where a worker subcontracts jobs between and 
among other worker providing for the benefits due him/her shall not be obligated upon 
the party who contracted the job. 
year shall be entitled to maternity benefits. 
SEC. 62. 
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SEC. 64. Pre-Termination of Contract. The employer may, at hislher own 
discretion, terminate the services of the worker: Provided, however, That said 
employer provides the worker with at least fifteen (15) days notice of termination and 
termination pay equivalent to at least one half (1/2) month's salary. In lieu of the 
fifteen (15) day notice of termination, the employer may immediately terminate the 
services of the worker: Provided, That said employer provides the worker termination 
pay equivalent to one (1) month's salary 
The employer may, for valid or just cause of loss of confidence, terminate the 
services of the worker prior to the expiration of the contract without indemnifying the 
latter with termination pay. 
Should the worker decide, on hislher own volition, to unilaterally leave the 
workplace prior to the expiration of the contract period, said worker shall forfeit any 
separation pay that may be due himlher. 
SEC. 65. Extent of Duty. The employer shall not require a worker to perform 
any task or work outside the assigned workplace for the service or benefit of another 
without the latter's consent and payment of just compensation. 
SEC. 66. Automatic Salary Increases. The contract of employment executed 
by and between the employer and the worker shall provide for an annual salary 
increase, the amount of which shall be determined by mutual agreement of the 
parties. 
SEC. 67. Deployment Expenses. Deployment expenses of a worker, including 
transportation and agency fees, shall be shouldered by the employer. 
TITLE 111 
FINAL PROVISIONS 
SEC. 68. Penal Provision. Any person who shall willfully interfere with, restrain 
or coerce a social worker in the exercise of hislher rights or shall in any manner 
commit any act in violation of any of the provision of this Act shall, upon conviction, 
be punished by a fine of not less than Ten thousand pesos (PlO,OOO.OO) but not more 
than Twenty thousand pesos (P20,OOO.OO) or imprisonment of one (1) year to six (6) 
years or both fine and imprisonment at the discretion of the court. 
If the offender is a public official, the court in addition to the penalties provided 
in the preceding paragraph, may impose the additional penalty of disqualification from 
public office. 
In the case of a private institutionlcompany found to be violating any provision 
of this Act, it shall be subject to a penalty ranging from suspension of license to 
revocation of such, at the discretion of the court. 
SEC. 69. Separability Clause. If any provision of this Act is declared 
unconstitutional or invalid, the provisions not affected shall continue to be in full force 
and effect. 
SEC. 70. Repealing Clause. All laws, decrees, orders, rules and regulations or 
other issuances inconsistent with the provisions of this Act are hereby repealed, 
amended or modified accordingly. 
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SEC. 71. Effectivity. This Act shall take effect fifteen (15) days after its 
2 
publication in at least two (2) newspapers of general circulation or the Official 
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Gazette, whichever comes first. 
4 
Approved. 
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