Labor Standards

 Scope: minimum requirements pursuant

to provisions of Labor Code, OSHS, and
other allied legislations and their rules
and regulations.

 Include GLS – wages, wage-related

benefits, hours as well as General
Occupational Safety and Health.
 WAGES
 “Wage” paid to any employee shall mean the
remuneration or earnings, however designated,
capable of being expressed in terms of money
whether fixed or ascertained on a time, task, piece,
or commission basis, or other method of calculating
the same, which is payable by an employer to an
employee under a written or unwritten contract of
employment for work done or or to be done, or for
services rendered and this includes the fair and
reasonable value as determined by the Secretary of
Labor, of board and lodging & other facilities
customarily furnished by an employer to the
employee.
 Fair and Reasonable Value
 Meals and snacks – not more than 70% of the value of
the meals and snacks enjoyed by the employees. The
remaining 30% has to be subsidized by the employer.
Ex. P50.00 x 70% = P35.00
P35.00 x 3 meals = P105.00
P105.00 x 26 days = P2,730.00

 Lodging – the cost of operation and maintenance,

including adequate depreciation plus reasonable
allowance (but not more than 5½% interest of the
depreciated amount of capital OR the fair rental value.
Who will determine the “fair and
reasonable value” of the facilities?
 Sec. 3, Rule VII-A, Book III of the IRR
The Secretary of Labor and Employment, or his
duly authorized representative, may from time to
time fix in appropriate issuances the fair and
reasonable value of board, lodging and other
facilities customarily furnished by an employer.

 Art. 97 (f) . . . . . . . . “as determined by the

Secretary of Labor and Employment.”
Covered Workers
• All Minimum Wage Earners in the private sector
in the National Capital Region regardless of their
position, designation or status and irrespective
of the method by which their wages are paid.

Exclusions
• Household or domestic helpers
• Persons in the personal service of another,
including family driver
• Workers of registered Barangay Micro Business
Enterprises (BMBEs) with Certificate of
Authority
 Exemptible Categories
• Retail/ service establishments employing not
more than 10 workers
• Distressed establishments
• Establishments facing potential losses
• Establishments with total assets (including from
loans but exclusive of the land on which the
particular business entity’s office, plant and
equipment are situated) are not more than
P3,000,000.00

 EXEMPTION IS FOR A MAXIMUM PERIOD OF

ONE YEAR FROM EFFECTIVITY OF THE WAGE ORDER
 Creditable Increase
Unorganized Establishments
• Increase granted within five (5) months prior to
effectivity of the Wage Order shall be creditable
as compliance

Organized Establishments
• Creditability provision of the CBA will prevail

In both cases:
• should not include anniversary, merit increase
and those resulting from the regularization or
promotion of employees.
• should the increase granted be less than the
prescribed adjustment, the employer shall pay
the difference.
 Payment of Wages

• Forms of payment – legal tender, check, ATM

• Time of payment – once every 2 weeks or twice
a month at intervals of not exceeding 16 days

• Place of payment – workplace

• Direct payment of wages – directly to the
workers to whom they are due
 Workers Paid by Result
• Are those workers whose pay is calculated not on
the basis of time spent on the job but according to
the quantity and quality or the kind of work they
turn out.

• The applicable Minimum Wage of workers paid by

results including those who are paid on piecework,
takay, pakyaw and task basis should not be less
than the applicable minimum wage rates for
normal working hours.
 Payment by Results
Article 101 of LC: “The Secretary of Labor shall
regulate the payment of wages by results, including
pakyaw, piecework and other non-time work, in
order to ensure the payment of fair and reasonable
wage rates, preferably through time and motion
studies or in consultation with the reps of workers
and employer’s organizations.”
Par. (a), Sec. 8, Rule VII, Book III of the IRR: “On
petition of any interested party, or upon its initiative,
the DOLE shall use all available resources,
including the use of time and motion studies x x x x
x to determine whether the employees x x x x x are
being compensated in accordance with the
prescribed minimum wage.”
Two Kinds of Workers Paid by Results

1. Those whose time and performance is

supervised by the employer. (Piece rate-
generally done in the company premises as is
practiced in garment factories.)

2. Those whose time and performance is

unsupervised. (Pakyaw and takay which is
commonly practiced in the agricultural
industry, e.g. in sugar plantations.)
 Apprentices/ Learners
• Are those covered by Apprenticeship/
Learnership Program duly approved by the
Technical Education and Skills Development
Authority (TESDA).

• The applicable minimum wage should not be

less than seventy five (75%) of the applicable
statutory wage rates.
 13th Month Pay
A. Coverage:
All employers are required to pay their rank and file
employees
- regardless of the nature of their employment; and
- irrespective of the method by which their wages
are paid
- provided they worked for at least one (1) month
during a calendar year.
B. Minimum Amount of 13th Month Pay

• Shall not be less than 1/12 of the total basic

salary earned by an employee within a
calendar year.

“basic salary” – all remunerations or earnings for

services rendered.

- does not include allowances and monetary

benefits which are not considered or integrated
as part of the regular or basic salary.
C. Time of Payment
• Shall be paid not later than December 24 of
each year. An employer, however, may give
to his employees one half (1/2) of the required
13th month pay before the opening of the
regular school year and the other half on or
before the 24th of December of every year.

D. Formula
Total Basic Salary
= 13th Month Pay
12 Months
 Overtime Pay
• Additional compensation for work or service
rendered or performed in excess of 8 hours;
25% - ordinary working days;
30% - rest days, special days, and
regular holidays;

• No Overtime Pay if Compressed Workweek

Scheme is voluntarily adopted;

• Undertime work not offset by overtime work.

 Night Shift Differential Pay
• Not applicable to employees of retail and service
establishments regularly employing not more than 5
employees, managerial & field employees.

• Not less than ten percent (10%) of the EE’s regular

wage for each hour of work performed between ten
o’clock in the evening and six o’clock in the morning.

• Sample computation:
P275.00/ 8 hrs. = P34.38 x 10% = P3.44
P3.44 + P34.38 = P37.82
 Regular Holiday Pay
• Not applicable to employees of retail and service
establishments regularly employing less than ten (10)
employees;
• Domestic helpers & persons in the personal service
of another;
• Managerial employees; and
• Field Personnel and other employees whose time and
performance is unsupervised by the employer like
task or contract basis, purely commission basis.
 Regular Holidays
• Regular Holidays Under Republic Act 9492

New Year’s Day - January 1

Maundy Thursday - Movable Date
Good Friday - Movable Date
Eidul – Fitr - Movable Date
Araw ng Kagitingan - Monday nearest April 9
Labor Day - Monday nearest May 1
Independence Day - Monday nearest June 12
National Heroes Day - Last Monday of August
Bonifacio Day - Monday nearest Nov. 30
Christmas Day - December 25
Rizal Day - Monday nearest Dec. 30
 Payment of Holiday Pay

• If worked - 200% of the regular wage

• If unworked - 100% of the regular wage

Condition for entitlement: the employee

should not have been absent without pay
on the last working day preceding the
regular holiday
Special Holidays Premium Pay
• Special Holidays under RA 9492:
Ninoy Aquino Day ----- Monday nearest August 21
All Saints Day ------------ November 1
Last Day of the Year --- December 31

• Payment:
- 30% based on the EE’s regular wage
- 50% if the special day falls on the EE’s rest day

Daily Paid EEs : “No Work, No Pay” applies

 Rest Day Premium Pay
 “It shall be the duty of every employer, whether
operating for profit or not, to provide each employee
a rest period of not less than twenty-four (24) hours
after every six (6) consecutive normal work days.”

• Payment:
- 30% based on the EE’s regular wage
- 50% if the rest day is at the same time
a special day

Daily Paid EEs: “No Work, No Pay” applies

 Service Charges (Art. 96)
• Applies to all employees of covered employers,
regardless of their positions, designations or
employment status, and irrespective of the method
by which their wages are paid, except managerial
employees.
• Distribution: 85% - shall be distributed equally
among the covered employees and 15% for the
management.
• Frequency of distribution.
• Permanency of service charges.
 Meal Periods
• Not less than sixty (60) minutes (not compensable)
• If less than sixty (60) minutes, compensable but, in
no case, be less than twenty (20) minutes and only
in the following cases:

1. Non-manual work or does not involve

strenuous physical exertion;
2. Operation not less than sixteen (16) hours a
day;
3. Emergencies, urgent work - to avoid serious
losses; and
4. Necessary - to prevent serious losses of
perishable goods.
Five (5) Days Service Incentive Leave Pay

• Applies only to employees who have rendered at

least one (1) year service;

Exceptions:
• Those who are already enjoying the benefit;

• Those enjoying vacation leave with pay for at

least five (5) days;
• Those employed in establishments regularly
employing less than ten (10) employees.
Five (5) Days Service Incentive Leave Pay

• Commutable to its money equivalent if not used

or exhausted at the end of the year;
• The basis of conversion shall be the salary rate
at the date of commutation;
• Vacation Leave and Sick Leave are not
mandatory or legally required; voluntary;
employer’s discretion.
 Maternity Leave
(Republic Act. No. 1161 as amended by R. A. No.
8282 otherwise known as the “Social Security Law of
1997” – took effect on May 24, 1997.)

• A female employee who has paid at least three (3)

monthly contributions in the twelve-month period
immediately preceding the semester of her
childbirth, or miscarriage shall be paid a daily
maternity benefit equivalent to one hundred
percent (100%) of her average salary credit for
sixty (60) days or seventy-eight (78) days in case of
caesarean delivery.
 Paternity Leave

Coverage

 Every married male employee in the private

sector shall be entitled to paternity leave

benefits of seven (7) days with full pay for the

first four (4) deliveries by his lawful spouse.

 Condition for Entitlement of
Paternity Leave Benefits

 A married male employee shall be entitled to

paternity benefits provided that:

• He is an employee at the time of delivery of his child;

• He is cohabiting with his spouse at the time she

gives birth or suffers a miscarriage;

• He has applied for paternity leave in accordance with

company rules after notification; and

• His wife has given birth or suffered a miscarriage.

 Retirement Pay
Coverage
• Employees shall be retired upon reaching the age
of 60 years or more but not beyond 65 years old.
• The retirement benefits pursuant to Article 287 of
the LC, as amended under RA 7641 and RA 8558 are
distinct and separate from the benefits provided by
the SSS law.
• The minimum retirement pay shall be equivalent to
one-half month salary for every year of service, a
fraction of at least six (6) months being considered
as one whole year.
• For the purpose of computing retirement pay, one-
half month salary shall include all of the following:
a. 15 days salary based on the latest salary;
b. cash equivalent of 5 days of SIL; and
c. one-twelfth (1/12 of the 13th month pay)

• Other benefits may be included in the computation

of the retirement pay upon agreement of the
employer and the employee or if provided in CBA.

• To illustrate:
Minimum Retirement Pay = number of years in service
x one-half month salary
 Retirement under a
Collective Bargaining Agreement (CBA)

• Any employee may retire or be retired by his

employer upon reaching the retirement age
established in the CBA or other applicable
agreement/contract and shall receive the retirement
benefits granted therein; provided, however, that
such retirement benefits shall not be less than the
retirement pay required under RA 7641 and provided
further that if such retirement benefits under the
agreement are less, the employer shall pay the
difference.
 Weekly Rest Periods
• Not less than twenty-four (24) consecutive
hours after every six (6) consecutive normal
work days;

• Employer shall determine and schedule the

weekly rest day of his employees;

• The employer shall respect the preference of

the employees based on religious grounds.
 Normal Hours of Work
• Shall not exceed eight (8) hours a day.
• Does not always mean continuous and
uninterrupted eight hours of work (broken hours).

Coverage
• Employees in all establishments and undertakings
whether for profit or not.

Exception
• Government employees, managerial employees,
other officers or members of the managerial staff,
domestic servants, non-agricultural field personnel,
and members of the family of the employer.
 Compressed Workweek
• Is a scheme where the generally observed six (6)
days workweek of eight (8) hours per day is
shortened to five (5) days only. The Saturday or 6th
day work may either be evenly distributed over the
five (5) working days from Monday to Friday.

• In the adoption of the compressed workweek, the

following concurring conditions should be met:
1. The employees voluntarily agree to work more than
eight hrs./day, the total in a week of which shall not
exceed their normal weekly hours of work, prior to
adoption of the CWW arrangements.
Continuation…Compressed Workweek

2. There will be no diminution whatsoever in the weekly or

monthly take-home pay and fringe benefits of the
employee.
3. If an employee is permitted or required to work in
excess of his normal weekly hours of work prior
to the adoption of the CWW scheme, all such
excess hours shall be considered overtime work
and shall be compensated in accordance with the
provisions of the LC or applicable CBA.
4. Appropriate waivers with respect to overtime premium
pay for work performed in excess of eight (8) hours a
day may be devised by the parties to the agreement.
5. The effectivity and implementation of the new working
time arrangements shall be by agreement of the parties.
Continuation…Compressed Workweek

 EMPLOYERS adopting the compressed workweek

scheme provided herein shall submit a REPORT
to the Department of Labor and Employment or to
its nearest Regional Office not later than ten (l0)
days from the adoption of the scheme.
 Registration of Contractor/
Sub-contractor (D.O. 18-02)
• Issuance governing contracting and sub-
contracting arrangements. These rules apply to all
parties of contracting and sub-contracting
arrangements where employer-employee
relationship exists. D.O. 18-02 requires registration
of contractors and sub-contractors for purposes of
establishing effective labor market information and
marketing.

• This registration is different from registration of

establishment under Rule 1020 of Occupational
Safety and Health Standards.
 Separation Pay (Art. 283-284)
 Separation pay is given to employees in instances
covered by Articles 283 and 284 of the Labor Code.
An employee’s entitlement to separation pay
depends on the reason or ground for the termination
of his services. An employee may be terminated for
just cause i.e. gross and habitual neglect of duty,
fraud or commission of a crime, and other similar
causes as enumerated under Art. 282 of the Labor
Code and generally may not be entitled to separation
pay. On the other hand, where the termination is for
authorized causes, separation pay is due.
A. One month pay or one-half month pay per year of
service
• An employee is entitled to receive as separation
pay the equivalent to one (1) month pay, or one-half
(1/2) month pay whichever is higher for every year
of service, a fraction of at least six months being
considered as one (1) whole year, if his separation
from the service is due to any of the following
causes:
1. Retrenchment to prevent losses, i.e. reduction
of personnel effected by management to prevent
losses;
2. Closure or cessation of operation of operation
of an establishment not due to serious losses or
financial reverses; and
3. When the employee is suffering from a disease not
curable within a period of six (6) months and his
continued employment is prejudicial to his health or
to the health of his co-employees.

In no case will an employee get less than one (1)

month separation pay if the separation is due to the
above stated causes, and he has served for at least six
months.
Thus, if an employee had been in the service for at
least six (6) months but less than a year, he is entitled
to one (1) full month’s pay if his separation is due to
any of the causes enumerated above. Service of one
year and above entitles the employee ½ month pay for
every year of service, a fraction of at least 6 months
considered one year.
B. One (1) month pay per year of service

• An employee is entitled to separation pay

equivalent to his one (1) month pay for every year
of service, a fraction of at least six (6) months being
considered as one whole year, if his separation from
service is due to any of the following:

a. Installation by employer of labor-saving devices.

b. Redundancy, as when the position of the

employee has been found to be surplusage or
unnecessary in the operation of the enterprise.
c. Impossible reinstatement of the employee to his
former or to a substantially equivalent position for
reasons not attributable to the fault of the
employer, as when the reinstatement ordered by a
competent authority cannot be implemented due
to closure or cessation of operations of the
establishment/ employer, or the position to which
he is to be reinstated no longer exists and there is
no substantially equivalent position in the
establishment to which he can be assigned (per
Supreme Court Decision).
 Alien Employment Permit

• Alien Employment Permit refers to the certificate

issued by the Director of the Regional Office
authorizing a resident alien to work in the
Philippines.

• Copy of the AEP, if employing aliens shall be

kept at the workplace.
 Work Permit (for Children)
• Before an employer engages a child for
employment, he must first secure a work permit
from the Regional Office of the DOLE having
jurisdiction over the workplace.

• Copy of Work Permit, if employing children less

than 15 years of age in the entertainment industry
shall be kept in the workplace.
 Payrolls/ Daily Time Records
• The payroll must show the names, sex, wage or
salary, allowances and other salary related
benefits such as overtime pay, premium pay,
deductions for withholding tax, SSS premiums,
PAG-IBIG premium and other legal deductions,
and the signature of the employees;

• Must be kept for a period of at least three (3)

years at the workplace.
 List of Labor Component

 Pursuant to RA 6727, employers are required

to submit to the Nat’l. Wages and Productivity

Board a list of their employees and the
corresponding information like length of
employment, status of employment and the
corresponding salary.
 Registration with SSS
• All employers must remember that their employees are
members of the SSS from the first day of employment,
hence they must keep copies of Registration of Employees
at the workplace.
• All employers who failed to register their employees with
the SSS will deprive their employees the benefits due them
other than the maternity leave, such as: Cash income
benefits for TTD, PP and PTD; sickness benefit; lifetime
monthly pension of members; dependent in case of death
of member; death benefit; funeral benefit; entitlement to
salary loan, housing loan and calamity loan.
• All employers must remember that their failure to register
their employees to the SSS and to remit the corresponding
premiums of said employees will make them criminally
liable under the SSS law.
 Coverage under the
PAG-IBIG Fund Program

 All employers shall remit to the PAG-IBIG Fund

Office the required contribution to the PAG-IBIG

Fund Office as provided by law.

Relationship between Core Labor Standards, ILO Conventions,
International and National Legislation/ Practice

Core
Labor
Standards

Bureau of Working Conditions

 Core
Labor
ILO Conventions on
Standards
Four Core Labor Standards

1. Freedom of association and right to collective

bargaining; ILO Convention 87 & 98
2. Elimination of all forms of forced labor;
ILO Convention 29 & 105

3. Effective abolition of Child Labor;

ILO Convention 138 & 182
4. Elimination of discrimination in respect of
employment and occupation; ILO convention 100 & 111

Source: ILO Handbook on Core Labor Standards

Bureau of Working Conditions
 Coverage of International Labor
Standards
1. Occupational Health and Safety (OHS)
2. Employment Promotion
3. Minimum Wages
4. Social Security
5. Labor Administration
6. Protection of Migrant Workers
7. Working Hours for Young Workers
8. Industrial Relations
9. Specific Economic Sectors.

Source: ILO Handbook on Core Labor Standards

Bureau of Working Conditions
 National Legislation

1. Labor Code of the Philippines

2. Occupational Safety and Health Standards
3. R.A. 9231 for the elimination of worst forms of
Child Labor and affording stronger protection
for the working child
4. R.A. 6275 for strengthening the prohibition on
discrimination against women with respect to
terms and conditions of employment.

Bureau of Working Conditions

 Importance of Respect and Compliance to LS

1. Promotes decent work;

2. Has productivity-increasing effect;

3. Generates positive impact on economic and

social development, and good governance;

4. Contributes to poverty reduction.

Source: ILO Handbook on Core Labor Standards

Bureau of Working Conditions