Details
Category: Labor Laws

BOOK TWO
HUMAN RESOURCES DEVELOPMENT PROGRAM

Title I
NATIONAL MANPOWER DEVELOPMENT PROGRAM

Chapter I
NATIONAL POLICIES AND ADMINISTRATIVE MACHINERY FOR THEIR IMPLEMENTATION

Art. 43. Statement of objective. It is the objective of this Title to develop human resources, establish training institutions, and formulate such plans and programs as will ensure efficient allocation, development and utilization of the nation’s manpower and thereby promote employment and accelerate economic and social growth.

Art. 44. Definitions. As used in this Title:

  1. "Manpower" shall mean that portion of the nation’s population which has actual or potential capability to contribute directly to the production of goods and services.
  2. "Entrepreneurship" shall mean training for self-employment or assisting individual or small industries within the purview of this Title.

Art. 45. National Manpower and Youth Council; Composition. To carry out the objectives of this Title, the National Manpower and Youth Council, which is attached to the Department of Labor for policy and program coordination and hereinafter referred to as the Council, shall be composed of the Secretary of Labor as ex-officio chairman, the Secretary of Education and Culture as ex-officio vice-chairman, and as ex-officio members, the Secretary of Economic Planning, the Secretary of Natural Resources, the Chairman of the Civil Service Commission, the Secretary of Social Welfare, the Secretary of Local Government, the Secretary of Science and Technology, the Secretary of Trade and Industry and the Director-General of the Council. The Director General shall have no vote.

In addition, the President shall appoint the following members from the private sector: two (2) representatives of national organizations of employers; two (2) representatives of national workers’ organizations; and one representative of national family and youth organizations, each for a term of three (3) years.

Art. 46. National Manpower Plan. The Council shall formulate a long-term national manpower plan for the optimum allocation, development and utilization of manpower for employment, entrepreneurship and economic and social growth. This manpower plan shall, after adoption by the Council, be updated annually and submitted to the President for his approval. Thereafter, it shall be the controlling plan for the development of manpower resources for the entire country in accordance with the national development plan. The Council shall call upon any agency of the Government or the private sector to assist in this effort.

Art. 47. National Manpower Skills Center. The Council shall establish a National Manpower Skills Center and regional and local training centers for the purpose of promoting the development of skills. The centers shall be administered and operated under such rules and regulations as may be established by the Council.

Art. 48. Establishment and formulation of skills standards. There shall be national skills standards for industry trades to be established by the Council in consultation with employers’ and workers’ organizations and appropriate government authorities. The Council shall thereafter administer the national skills standards.

Art. 49. Administration of training programs. The Council shall provide, through the Secretariat, instructor training, entrepreneurship development, training in vocations, trades and other fields of employment, and assist any employer or organization in training schemes designed to attain its objectives under rules and regulations which the Council shall establish for this purpose.

The Council shall exercise, through the Secretariat, authority and jurisdiction over, and administer, on-going technical assistance programs and/or grants-in-aid for manpower and youth development including those which may be entered into between the Government of the Philippines and international and foreign organizations and nations, as well as persons and organizations in the Philippines.

In order to integrate the national manpower development efforts, all manpower training schemes as provided for in this Code shall be coordinated with the Council, particularly those having to do with the setting of skills standards. For this purpose, existing manpower training programs in the government and in the private sector shall be reported to the Council which may regulate such programs to make them conform with national development programs.

This Article shall not include apprentices, learners and handicapped workers as governed by appropriate provisions of this Code.

Art. 50. Industry boards. The Council shall establish industry boards to assist in the establishment of manpower development schemes, trades and skills standards and such other functions as will provide direct participation of employers and workers in the fulfillment of the Council’s objectives, in accordance with guidelines to be established by the Council and in consultation with the National Economic and Development Authority.

The maintenance and operations of the industry boards shall be financed through a funding scheme under such rates of fees and manners of collection and disbursements as may be determined by the Council.

Art. 51. Employment service training functions. The Council shall utilize the employment service of the Department of Labor for the placement of its graduates. The Bureau of Employment Services shall render assistance to the Council in the measurement of unemployment and underemployment, conduct of local manpower resource surveys and occupational studies including an inventory of the labor force, establishment and maintenance without charge of a national register of technicians who have successfully completed a training program under this Act, and skilled manpower including its publication, maintenance of an adequate and up-to-date system of employment information.

Art. 52. Incentive Scheme. An additional deduction from taxable income of one-half (1/2) of the value of labor training expenses incurred for development programs shall be granted to the person or enterprise concerned provided that such development programs, other than apprenticeship, are approved by the Council and the deduction does not exceed ten percent (10%) of the direct labor wage.

There shall be a review of the said scheme two years after its implementation.

Art. 53. Council Secretariat. The Council shall have a Secretariat headed by a Director-General who shall be assisted by a Deputy Director-General, both of whom shall be career administrators appointed by the President of the Philippines on recommendation of the Secretary of Labor. The Secretariat shall be under the administrative supervision of the Secretary of Labor and shall have an Office of Manpower Planning and Development, an Office of Vocational Preparation, a National Manpower Skills Center, regional manpower development offices and such other offices as may be necessary.

The Director-General shall have the rank and emoluments of an undersecretary and shall serve for a term of ten (10) years. The Executive-Directors of the Office of Manpower Planning and Development, the Office of Vocational Preparation and the National Manpower Skills Center shall have the rank and emoluments of a bureau director and shall be subject to Civil Service Law, rules and regulations. The Director-General, Deputy Director-General and Executive Directors shall be natural-born citizens, between thirty and fifty years of age at the time of appointment, with a master’s degree or its equivalent, and experience in national planning and development of human resources. The Executive Director of the National Manpower Skills Center shall, in addition to the foregoing qualifications, have undergone training in center management. Executive Directors shall be appointed by the President on the recommendations of the Secretary of Labor and Employment.

The Director-General shall appoint such personnel necessary to carry out the objectives, policies and functions of the Council subject to Civil Service rules. The regular professional and technical personnel shall be exempt from WAPCO rules and regulations.

The Secretariat shall have the following functions and responsibilities:

  1. To prepare and recommend the manpower plan for approval by the Council;
  2. To recommend allocation of resources for the implementation of the manpower plan as approved by the Council;
  3. To carry out the manpower plan as the implementing arm of the Council;
  4. To effect the efficient performance of the functions of the Council and the achievement of the objectives of this Title;
  5. To determine specific allocation of resources for the projects to be undertaken pursuant to approved manpower plans;
  6. To submit to the Council periodic reports on progress and accomplishment of work programs;
  7. To prepare for approval by the Council an annual report to the President on plans, programs and projects on manpower and out-of-school youth development;
  8. To enter into agreements to implement approved plans and programs and perform any and all such acts as will fulfill the objectives of this Code as well as ensure the efficient performance of the functions of the Council; and
  9. To perform such other functions as may be authorized by the Council.

Art. 54. Regional manpower development offices. The Council shall create regional manpower development offices which shall determine the manpower needs of the industry, agriculture and other sectors of the economy within their respective jurisdictions; provide the Council’s central planners with the data for updating the national manpower plan; recommend programs for the regional level agencies engaged in manpower and youth development within the policies formulated by the Council; and administer and supervise Secretariat training programs within the region and perform such other functions as may be authorized by the Council.

Art. 55. Consultants and technical assistance, publication and research. In pursuing its objectives, the Council is authorized to set aside a portion of its appropriation for the hiring of the services of qualified consultants, and/or private organizations for research work and publication. It shall avail itself of the services of the Government as may be required.

Art. 56. Rules and regulations. The Council shall define its broad functions and issue appropriate rules and regulations necessary to implement the provision of this Code.

Title II
TRAINING AND EMPLOYMENT OF SPECIAL WORKERS

Chapter I
APPRENTICES

Art. 57. Statement of objectives. This Title aims:

  1. To help meet the demand of the economy for trained manpower;
  2. To establish a national apprenticeship program through the participation of employers, workers and government and non-government agencies; and
  3. To establish apprenticeship standards for the protection of apprentices.

Art. 58. Definition of Terms. As used in this Title:

  1. "Apprenticeship" means practical training on the job supplemented by related theoretical instruction.
  2. An "apprentice" is a worker who is covered by a written apprenticeship agreement with an individual employer or any of the entities recognized under this Chapter.
  3. An "apprenticeable occupation" means any trade, form of employment or occupation which requires more than three (3) months of practical training on the job supplemented by related theoretical instruction.
  4. "Apprenticeship agreement" is an employment contract wherein the employer binds himself to train the apprentice and the apprentice in turn accepts the terms of training.

Art. 59. Qualifications of apprentice. To qualify as an apprentice, a person shall:

  1. Be at least fourteen (14) years of age;
  2. Possess vocational aptitude and capacity for appropriate tests; and
  3. Possess the ability to comprehend and follow oral and written instructions.

Trade and industry associations may recommend to the Secretary of Labor appropriate educational requirements for different occupations.

Art. 60. Employment of apprentices. Only employers in the highly technical industries may employ apprentices and only in apprenticeable occupations approved by the Secretary of Labor and Employment. (As amended by Section 1, Executive Order No. 111, December 24, 1986)

Art. 61. Contents of apprenticeship agreements. Apprenticeship agreements, including the wage rates of apprentices, shall conform to the rules issued by the Secretary of Labor and Employment. The period of apprenticeship shall not exceed six months. Apprenticeship agreements providing for wage rates below the legal minimum wage, which in no case shall start below 75 percent of the applicable minimum wage, may be entered into only in accordance with apprenticeship programs duly approved by the Secretary of Labor and Employment. The Department shall develop standard model programs of apprenticeship. (As amended by Section 1, Executive Order No. 111, December 24, 1986)

Art. 62. Signing of apprenticeship agreement. Every apprenticeship agreement shall be signed by the employer or his agent, or by an authorized representative of any of the recognized organizations, associations or groups and by the apprentice.

An apprenticeship agreement with a minor shall be signed in his behalf by his parent or guardian, if the latter is not available, by an authorized representative of the Department of Labor, and the same shall be binding during its lifetime.

Every apprenticeship agreement entered into under this Title shall be ratified by the appropriate apprenticeship committees, if any, and a copy thereof shall be furnished both the employer and the apprentice.

Art. 63. Venue of apprenticeship programs. Any firm, employer, group or association, industry organization or civic group wishing to organize an apprenticeship program may choose from any of the following apprenticeship schemes as the training venue for apprentice:

  1. Apprenticeship conducted entirely by and within the sponsoring firm, establishment or entity;
  2. Apprenticeship entirely within a Department of Labor and Employment training center or other public training institution; or
  3. Initial training in trade fundamentals in a training center or other institution with subsequent actual work participation within the sponsoring firm or entity during the final stage of training.

Art. 64. Sponsoring of apprenticeship program. Any of the apprenticeship schemes recognized herein may be undertaken or sponsored by a single employer or firm or by a group or association thereof or by a civic organization. Actual training of apprentices may be undertaken:

  1. In the premises of the sponsoring employer in the case of individual apprenticeship programs;
  2. In the premises of one or several designated firms in the case of programs sponsored by a group or association of employers or by a civic organization; or
  3. In a Department of Labor and Employment training center or other public training institution.

Art. 65. Investigation of violation of apprenticeship agreement. Upon complaint of any interested person or upon its own initiative, the appropriate agency of the Department of Labor and Employment or its authorized representative shall investigate any violation of an apprenticeship agreement pursuant to such rules and regulations as may be prescribed by the Secretary of Labor and Employment.

Art. 66. Appeal to the Secretary of Labor and Employment. The decision of the authorized agency of the Department of Labor and Employment may be appealed by any aggrieved person to the Secretary of Labor and Employment within five (5) days from receipt of the decision. The decision of the Secretary of Labor and Employment shall be final and executory.

Art. 67. Exhaustion of administrative remedies. No person shall institute any action for the enforcement of any apprenticeship agreement or damages for breach of any such agreement, unless he has exhausted all available administrative remedies.

Art. 68. Aptitude testing of applicants. Consonant with the minimum qualifications of apprentice-applicants required under this Chapter, employers or entities with duly recognized apprenticeship programs shall have primary responsibility for providing appropriate aptitude tests in the selection of apprentices. If they do not have adequate facilities for the purpose, the Department of Labor and Employment shall perform the service free of charge.

Art. 69. Responsibility for theoretical instruction. Supplementary theoretical instruction to apprentices in cases where the program is undertaken in the plant may be done by the employer. If the latter is not prepared to assume the responsibility, the same may be delegated to an appropriate government agency.

Art. 70. Voluntary organization of apprenticeship programs; exemptions.

  1. The organization of apprenticeship program shall be primarily a voluntary undertaking by employers;
  2. When national security or particular requirements of economic development so demand, the President of the Philippines may require compulsory training of apprentices in certain trades, occupations, jobs or employment levels where shortage of trained manpower is deemed critical as determined by the Secretary of Labor and Employment. Appropriate rules in this connection shall be promulgated by the Secretary of Labor and Employment as the need arises; and
  3. Where services of foreign technicians are utilized by private companies in apprenticeable trades, said companies are required to set up appropriate apprenticeship programs.

Art. 71. Deductibility of training costs. An additional deduction from taxable income of one-half (1/2) of the value of labor training expenses incurred for developing the productivity and efficiency of apprentices shall be granted to the person or enterprise organizing an apprenticeship program: Provided, That such program is duly recognized by the Department of Labor and Employment: Provided, further, That such deduction shall not exceed ten (10%) percent of direct labor wage: and Provided, finally, That the person or enterprise who wishes to avail himself or itself of this incentive should pay his apprentices the minimum wage.

Art. 72. Apprentices without compensation. The Secretary of Labor and Employment may authorize the hiring of apprentices without compensation whose training on the job is required by the school or training program curriculum or as requisite for graduation or board examination.

Chapter II
LEARNERS

Art. 73. Learners defined. Learners are persons hired as trainees in semi-skilled and other industrial occupations which are non-apprenticeable and which may be learned through practical training on the job in a relatively short period of time which shall not exceed three (3) months.

Art. 74. When learners may be hired. Learners may be employed when no experienced workers are available, the employment of learners is necessary to prevent curtailment of employment opportunities, and the employment does not create unfair competition in terms of labor costs or impair or lower working standards.

Art. 75. Learnership agreement. Any employer desiring to employ learners shall enter into a learnership agreement with them, which agreement shall include:

  1. The names and addresses of the learners;
  2. The duration of the learnership period, which shall not exceed three (3) months;
  3. The wages or salary rates of the learners which shall begin at not less than seventy-five percent (75%) of the applicable minimum wage; and
  4. A commitment to employ the learners if they so desire, as regular employees upon completion of the learnership. All learners who have been allowed or suffered to work during the first two (2) months shall be deemed regular employees if training is terminated by the employer before the end of the stipulated period through no fault of the learners.

The learnership agreement shall be subject to inspection by the Secretary of Labor and Employment or his duly authorized representative.

Art. 76. Learners in piecework. Learners employed in piece or incentive-rate jobs during the training period shall be paid in full for the work done.

Art. 77. Penalty clause. Any violation of this Chapter or its implementing rules and regulations shall be subject to the general penalty clause provided for in this Code.

Chapter III
HANDICAPPED WORKERS

Art. 78. Definition. Handicapped workers are those whose earning capacity is impaired by age or physical or mental deficiency or injury.

Art. 79. When employable. Handicapped workers may be employed when their employment is necessary to prevent curtailment of employment opportunities and when it does not create unfair competition in labor costs or impair or lower working standards.

Art. 80. Employment agreement. Any employer who employs handicapped workers shall enter into an employment agreement with them, which agreement shall include:

  1. The names and addresses of the handicapped workers to be employed;
  2. The rate to be paid the handicapped workers which shall not be less than seventy five (75%) percent of the applicable legal minimum wage;
  3. The duration of employment period; and
  4. The work to be performed by handicapped workers.

The employment agreement shall be subject to inspection by the Secretary of Labor or his duly authorized representative.

Art. 81. Eligibility for apprenticeship. Subject to the appropriate provisions of this Code, handicapped workers may be hired as apprentices or learners if their handicap is not such as to effectively impede the performance of job operations in the particular occupations for which they are hired.

Details
Category: Labor Laws


PRESIDENTIAL DECREE NO. 442, AS AMENDED

A DECREE INSTITUTING A LABOR CODE THEREBY REVISING AND CONSOLIDATING LABOR AND SOCIAL LAWS TO AFFORD PROTECTION TO LABOR, PROMOTE EMPLOYMENT AND HUMAN RESOURCES DEVELOPMENT AND INSURE INDUSTRIAL PEACE BASED ON SOCIAL JUSTICE

PRELIMINARY TITLE

Chapter I
GENERAL PROVISIONS

Art. 1. Name of Decree. This Decree shall be known as the "Labor Code of the Philippines".

Art. 2. Date of effectivity. This Code shall take effect six (6) months after its promulgation.

Art. 3. Declaration of basic policy. The State shall afford protection to labor, promote full employment, ensure equal work opportunities regardless of sex, race or creed and regulate the relations between workers and employers. The State shall assure the rights of workers to self-organization, collective bargaining, security of tenure, and just and humane conditions of work.

Art. 4. Construction in favor of labor. All doubts in the implementation and interpretation of the provisions of this Code, including its implementing rules and regulations, shall be resolved in favor of labor.

Art. 5. Rules and regulations. The Department of Labor and other government agencies charged with the administration and enforcement of this Code or any of its parts shall promulgate the necessary implementing rules and regulations. Such rules and regulations shall become effective fifteen (15) days after announcement of their adoption in newspapers of general circulation.

Art. 6. Applicability. All rights and benefits granted to workers under this Code shall, except as may otherwise be provided herein, apply alike to all workers, whether agricultural or non-agricultural. (As amended by Presidential Decree No. 570-A, November 1, 1974)

Chapter II
EMANCIPATION OF TENANTS

Art. 7. Statement of objectives. Inasmuch as the old concept of land ownership by a few has spawned valid and legitimate grievances that gave rise to violent conflict and social tension and the redress of such legitimate grievances being one of the fundamental objectives of the New Society, it has become imperative to start reformation with the emancipation of the tiller of the soil from his bondage.

Art. 8. Transfer of lands to tenant-workers. Being a vital part of the labor force, tenant-farmers on private agricultural lands primarily devoted to rice and corn under a system of share crop or lease tenancy whether classified as landed estate or not shall be deemed owner of a portion constituting a family-size farm of five (5) hectares, if not irrigated and three (3) hectares, if irrigated.

In all cases, the land owner may retain an area of not more than seven (7) hectares if such landowner is cultivating such area or will now cultivate it.

Art. 9. Determination of land value. For the purpose of determining the cost of the land to be transferred to the tenant-farmer, the value of the land shall be equivalent to two and one-half (2-1/2) times the average harvest of three (3) normal crop years immediately preceding the promulgation of Presidential Decree No. 27 on October 21, 1972.

The total cost of the land, including interest at the rate of six percent (6%) per annum, shall be paid by the tenant in fifteen (15) years of fifteen (15) equal annual amortizations.

In case of default, the amortization due shall be paid by the farmers’ cooperative in which the defaulting tenant-farmer is a member, with the cooperative having a right of recourse against him.

The government shall guarantee such amortizations with shares of stock in government-owned and government-controlled corporations.

Art. 10. Conditions of ownership. No title to the land acquired by the tenant-farmer under Presidential Decree No. 27 shall be actually issued to him unless and until he has become a full-fledged member of a duly recognized farmers’ cooperative.

Title to the land acquired pursuant to Presidential Decree No. 27 or the Land Reform Program of the Government shall not be transferable except by hereditary succession or to the Government in accordance with the provisions of Presidential Decree No. 27, the Code of Agrarian Reforms and other existing laws and regulations.

Art. 11. Implementing agency. The Department of Agrarian Reform shall promulgate the necessary rules and regulations to implement the provisions of this Chapter.

Details
Category: Labor Laws

BOOK ONE

PRE-EMPLOYMENT

Art. 12. Statement of objectives. It is the policy of the State:

  1. To promote and maintain a state of full employment through improved manpower training, allocation and utilization;
  2. To protect every citizen desiring to work locally or overseas by securing for him the best possible terms and conditions of employment;
  3. To facilitate a free choice of available employment by persons seeking work in conformity with the national interest;
  4. To facilitate and regulate the movement of workers in conformity with the national interest;
  5. To regulate the employment of aliens, including the establishment of a registration and/or work permit system;
  6. To strengthen the network of public employment offices and rationalize the participation of the private sector in the recruitment and placement of workers, locally and overseas, to serve national development objectives;
  7. To insure careful selection of Filipino workers for overseas employment in order to protect the good name of the Philippines abroad.

Title I
RECRUITMENT AND PLACEMENT OF WORKERS

Chapter I
GENERAL PROVISIONS

Art. 13. Definitions.

  1. "Worker" means any member of the labor force, whether employed or unemployed.
  2. "Recruitment and placement" refers to any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, and includes referrals, contract services, promising or advertising for employment, locally or abroad, whether for profit or not: Provided, That any person or entity which, in any manner, offers or promises for a fee, employment to two or more persons shall be deemed engaged in recruitment and placement.
  3. "Private fee-charging employment agency" means any person or entity engaged in recruitment and placement of workers for a fee which is charged, directly or indirectly, from the workers or employers or both.
  4. "License" means a document issued by the Department of Labor authorizing a person or entity to operate a private employment agency.
  5. "Private recruitment entity" means any person or association engaged in the recruitment and placement of workers, locally or overseas, without charging, directly or indirectly, any fee from the workers or employers.
  6. "Authority" means a document issued by the Department of Labor authorizing a person or association to engage in recruitment and placement activities as a private recruitment entity.
  7. "Seaman" means any person employed in a vessel engaged in maritime navigation.
  8. "Overseas employment" means employment of a worker outside the Philippines.
  9. "Emigrant" means any person, worker or otherwise, who emigrates to a foreign country by virtue of an immigrant visa or resident permit or its equivalent in the country of destination.

Art. 14. Employment promotion. The Secretary of Labor shall have the power and authority:

  1. To organize and establish new employment offices in addition to the existing employment offices under the Department of Labor as the need arises;
  2. To organize and establish a nationwide job clearance and information system to inform applicants registering with a particular employment office of job opportunities in other parts of the country as well as job opportunities abroad;
  3. To develop and organize a program that will facilitate occupational, industrial and geographical mobility of labor and provide assistance in the relocation of workers from one area to another; and
  4. To require any person, establishment, organization or institution to submit such employment information as may be prescribed by the Secretary of Labor.

Art. 15. Bureau of Employment Services.

  1. The Bureau of Employment Services shall be primarily responsible for developing and monitoring a comprehensive employment program. It shall have the power and duty:
     
    1. To formulate and develop plans and programs to implement the employment promotion objectives of this Title;
    2. To establish and maintain a registration and/or licensing system to regulate private sector participation in the recruitment and placement of workers, locally and overseas, and to secure the best possible terms and conditions of employment for Filipino contract workers and compliance therewith under such rules and regulations as may be issued by the Minister of Labor;
    3. To formulate and develop employment programs designed to benefit disadvantaged groups and communities;
    4. To establish and maintain a registration and/or work permit system to regulate the employment of aliens;
    5. To develop a labor market information system in aid of proper manpower and development planning;
    6. To develop a responsive vocational guidance and testing system in aid of proper human resources allocation; and
    7. To maintain a central registry of skills, except seamen.
  2. The regional offices of the Ministry of Labor shall have the original and exclusive jurisdiction over all matters or cases involving employer-employee relations including money claims, arising out of or by virtue of any law or contracts involving Filipino workers for overseas employment except seamen: Provided, That the Bureau of Employment Services may, in the case of the National Capital Region, exercise such power, whenever the Minister of Labor deems it appropriate. The decisions of the regional offices of the Bureau of Employment Services, if so authorized by the Minister of Labor as provided in this Article, shall be appealable to the National Labor Relations Commission upon the same grounds provided in Article 223 hereof. The decisions of the National Labor Relations Commission shall be final and inappealable. (Superseded by Exec. Order 797, May 1, 1982).
  3. The Minister of Labor shall have the power to impose and collect fees based on rates recommended by the Bureau of Employment Services. Such fees shall be deposited in the National Treasury as a special account of the General Fund, for the promotion of the objectives of the Bureau of Employment Services, subject to the provisions of Section 40 of Presidential Decree No. 1177.

Art. 16. Private recruitment. Except as provided in Chapter II of this Title, no person or entity other than the public employment offices, shall engage in the recruitment and placement of workers.

Art. 17. Overseas Employment Development Board. An Overseas Employment Development Board is hereby created to undertake, in cooperation with relevant entities and agencies, a systematic program for overseas employment of Filipino workers in excess of domestic needs and to protect their rights to fair and equitable employment practices. It shall have the power and duty:

  1. To promote the overseas employment of Filipino workers through a comprehensive market promotion and development program;
  2. To secure the best possible terms and conditions of employment of Filipino contract workers on a government-to-government basis and to ensure compliance therewith;
  3. To recruit and place workers for overseas employment on a government-to-government arrangement and in such other sectors as policy may dictate; and
  4. To act as secretariat for the Board of Trustees of the Welfare and Training Fund for Overseas Workers.

Art. 18. Ban on direct-hiring. No employer may hire a Filipino worker for overseas employment except through the Boards and entities authorized by the Secretary of Labor. Direct-hiring by members of the diplomatic corps, international organizations and such other employers as may be allowed by the Secretary of Labor is exempted from this provision.

Art. 19. Office of Emigrant Affairs.

  1. Pursuant to the national policy to maintain close ties with Filipino migrant communities and promote their welfare as well as establish a data bank in aid of national manpower policy formulation, an Office of Emigrant Affairs is hereby created in the Department of Labor. The Office shall be a unit at the Office of the Secretary and shall initially be manned and operated by such personnel and through such funding as are available within the Department and its attached agencies. Thereafter, its appropriation shall be made part of the regular General Appropriations Decree.
  2. The office shall, among others, promote the well-being of emigrants and maintain their close link to the homeland by:
     
    1. serving as a liaison with migrant communities;
    2. provision of welfare and cultural services;
    3. promote and facilitate re-integration of migrants into the national mainstream;
    4. promote economic; political and cultural ties with the communities; and
    5. generally to undertake such activities as may be appropriate to enhance such cooperative links.

Art. 20. National Seamen Board.

  1. A National Seamen Board is hereby created which shall develop and maintain a comprehensive program for Filipino seamen employed overseas. It shall have the power and duty:
     
    1. To provide free placement services for seamen;
    2. To regulate and supervise the activities of agents or representatives of shipping companies in the hiring of seamen for overseas employment and secure the best possible terms of employment for contract seamen workers and secure compliance therewith;
    3. To maintain a complete registry of all Filipino seamen.
  2. The Board shall have original and exclusive jurisdiction over all matters or cases including money claims, involving employer-employee relations, arising out of or by virtue of any law or contracts involving Filipino seamen for overseas employment. The decisions of the Board shall be appealable to the National Labor Relations Commission upon the same grounds provided in Article 223 hereof. The decisions of the National Labor Relations Commission shall be final and inappealable.

Art. 21. Foreign service role and participation. To provide ample protection to Filipino workers abroad, the labor attaches, the labor reporting officers duly designated by the Secretary of Labor and the Philippine diplomatic or consular officials concerned shall, even without prior instruction or advice from the home office, exercise the power and duty:

  1. To provide all Filipino workers within their jurisdiction assistance on all matters arising out of employment;
  2. To insure that Filipino workers are not exploited or discriminated against;
  3. To verify and certify as requisite to authentication that the terms and conditions of employment in contracts involving Filipino workers are in accordance with the Labor Code and rules and regulations of the Overseas Employment Development Board and National Seamen Board;
  4. To make continuing studies or researches and recommendations on the various aspects of the employment market within their jurisdiction;
  5. To gather and analyze information on the employment situation and its probable trends, and to make such information available; and
  6. To perform such other duties as may be required of them from time to time.

Art. 22. Mandatory remittance of foreign exchange earnings. It shall be mandatory for all Filipino workers abroad to remit a portion of their foreign exchange earnings to their families, dependents, and/or beneficiaries in the country in accordance with rules and regulations prescribed by the Secretary of Labor.

Art. 23. Composition of the Boards.

  1. The OEDB shall be composed of the Secretary of Labor and Employment as Chairman, the Undersecretary of Labor as Vice-Chairman, and a representative each of the Department of Foreign Affairs, the Department of National Defense, the Central Bank, the Department of Education, Culture and Sports, the National Manpower and Youth Council, the Bureau of Employment Services, a workers’ organization and an employers’ organization and the Executive Director of the OEDB as members.
  2. The National Seamen Board shall be composed of the Secretary of Labor and Employment as Chairman, the Undersecretary of Labor as Vice-Chairman, the Commandant of the Philippine Coast Guard, and a representative each of the Department of Foreign Affairs, the Department of Education, Culture and Sports, the Central Bank, the Maritime Industry Authority, the Bureau of Employment Services, a national shipping association and the Executive Director of the NSB as members.
     
    The members of the Boards shall receive allowances to be determined by the Board which shall not be more than P2,000.00 per month.
  3. The Boards shall be attached to the Department of Labor for policy and program coordination. They shall each be assisted by a Secretariat headed by an Executive Director who shall be a Filipino citizen with sufficient experience in manpower administration, including overseas employment activities. The Executive Director shall be appointed by the President of the Philippines upon the recommendation of the Secretary of Labor and shall receive an annual salary as fixed by law. The Secretary of Labor shall appoint the other members of the Secretariat.
  4. The Auditor General shall appoint his representative to the Boards to audit their respective accounts in accordance with auditing laws and pertinent rules and regulations.

Art. 24. Boards to issue rules and collect fees. The Boards shall issue appropriate rules and regulations to carry out their functions. They shall have the power to impose and collect fees from employers concerned, which shall be deposited in the respective accounts of said Boards and be used by them exclusively to promote their objectives.

Chapter II
REGULATION OF RECRUITMENT AND PLACEMENT ACTIVITIES

Art. 25. Private sector participation in the recruitment and placement of workers. Pursuant to national development objectives and in order to harness and maximize the use of private sector resources and initiative in the development and implementation of a comprehensive employment program, the private employment sector shall participate in the recruitment and placement of workers, locally and overseas, under such guidelines, rules and regulations as may be issued by the Secretary of Labor.

Art. 26. Travel agencies prohibited to recruit. Travel agencies and sales agencies of airline companies are prohibited from engaging in the business of recruitment and placement of workers for overseas employment whether for profit or not.

Art. 27. Citizenship requirement. Only Filipino citizens or corporations, partnerships or entities at least seventy-five percent (75%) of the authorized and voting capital stock of which is owned and controlled by Filipino citizens shall be permitted to participate in the recruitment and placement of workers, locally or overseas.

Art. 28. Capitalization. All applicants for authority to hire or renewal of license to recruit are required to have such substantial capitalization as determined by the Secretary of Labor.

Art. 29. Non-transferability of license or authority. No license or authority shall be used directly or indirectly by any person other than the one in whose favor it was issued or at any place other than that stated in the license or authority be transferred, conveyed or assigned to any other person or entity. Any transfer of business address, appointment or designation of any agent or representative including the establishment of additional offices anywhere shall be subject to the prior approval of the Department of Labor.

Art. 30. Registration fees. The Secretary of Labor shall promulgate a schedule of fees for the registration of all applicants for license or authority.

Art. 31. Bonds. All applicants for license or authority shall post such cash and surety bonds as determined by the Secretary of Labor to guarantee compliance with prescribed recruitment procedures, rules and regulations, and terms and conditions of employment as may be appropriate.

Art. 32. Fees to be paid by workers. Any person applying with a private fee-charging employment agency for employment assistance shall not be charged any fee until he has obtained employment through its efforts or has actually commenced employment. Such fee shall be always covered with the appropriate receipt clearly showing the amount paid. The Secretary of Labor shall promulgate a schedule of allowable fees.

Art. 33. Reports on employment status. Whenever the public interest requires, the Secretary of Labor may direct all persons or entities within the coverage of this Title to submit a report on the status of employment, including job vacancies, details of job requisitions, separation from jobs, wages, other terms and conditions and other employment data.

Art. 34. Prohibited practices. It shall be unlawful for any individual, entity, licensee, or holder of authority:

  1. To charge or accept, directly or indirectly, any amount greater than that specified in the schedule of allowable fees prescribed by the Secretary of Labor, or to make a worker pay any amount greater than that actually received by him as a loan or advance;
  2. To furnish or publish any false notice or information or document in relation to recruitment or employment;
  3. To give any false notice, testimony, information or document or commit any act of misrepresentation for the purpose of securing a license or authority under this Code.
  4. To induce or attempt to induce a worker already employed to quit his employment in order to offer him to another unless the transfer is designed to liberate the worker from oppressive terms and conditions of employment;
  5. To influence or to attempt to influence any person or entity not to employ any worker who has not applied for employment through his agency;
  6. To engage in the recruitment or placement of workers in jobs harmful to public health or morality or to the dignity of the Republic of the Philippines;
  7. To obstruct or attempt to obstruct inspection by the Secretary of Labor or by his duly authorized representatives;
  8. To fail to file reports on the status of employment, placement vacancies, remittance of foreign exchange earnings, separation from jobs, departures and such other matters or information as may be required by the Secretary of Labor.
  9. To substitute or alter employment contracts approved and verified by the Department of Labor from the time of actual signing thereof by the parties up to and including the periods of expiration of the same without the approval of the Secretary of Labor;
  10. To become an officer or member of the Board of any corporation engaged in travel agency or to be engaged directly or indirectly in the management of a travel agency; and
  11. To withhold or deny travel documents from applicant workers before departure for monetary or financial considerations other than those authorized under this Code and its implementing rules and regulations.

Art. 35. Suspension and/or cancellation of license or authority. The Minister of Labor shall have the power to suspend or cancel any license or authority to recruit employees for overseas employment for violation of rules and regulations issued by the Ministry of Labor, the Overseas Employment Development Board, or for violation of the provisions of this and other applicable laws, General Orders and Letters of Instructions.

Chapter III
MISCELLANEOUS PROVISIONS

Art. 36. Regulatory power. The Secretary of Labor shall have the power to restrict and regulate the recruitment and placement activities of all agencies within the coverage of this Title and is hereby authorized to issue orders and promulgate rules and regulations to carry out the objectives and implement the provisions of this Title.

Art. 37. Visitorial Power. The Secretary of Labor or his duly authorized representatives may, at any time, inspect the premises, books of accounts and records of any person or entity covered by this Title, require it to submit reports regularly on prescribed forms, and act on violation of any provisions of this Title.

Art. 38. Illegal recruitment.

  1. Any recruitment activities, including the prohibited practices enumerated under Article 34 of this Code, to be undertaken by non-licensees or non-holders of authority, shall be deemed illegal and punishable under Article 39 of this Code. The Department of Labor and Employment or any law enforcement officer may initiate complaints under this Article.
  2. Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense involving economic sabotage and shall be penalized in accordance with Article 39 hereof.
     
    Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring and/or confederating with one another in carrying out any unlawful or illegal transaction, enterprise or scheme defined under the first paragraph hereof. Illegal recruitment is deemed committed in large scale if committed against three (3) or more persons individually or as a group.
  3. The Secretary of Labor and Employment or his duly authorized representatives shall have the power to cause the arrest and detention of such non-licensee or non-holder of authority if after investigation it is determined that his activities constitute a danger to national security and public order or will lead to further exploitation of job-seekers. The Secretary shall order the search of the office or premises and seizure of documents, paraphernalia, properties and other implements used in illegal recruitment activities and the closure of companies, establishments and entities found to be engaged in the recruitment of workers for overseas employment, without having been licensed or authorized to do so.

Art. 39. Penalties.

  1. The penalty of life imprisonment and a fine of One Hundred Thousand Pesos (P1000,000.00) shall be imposed if illegal recruitment constitutes economic sabotage as defined herein;
  2. Any licensee or holder of authority found violating or causing another to violate any provision of this Title or its implementing rules and regulations shall, upon conviction thereof, suffer the penalty of imprisonment of not less than two years nor more than five years or a fine of not less than P10,000 nor more than P50,000, or both such imprisonment and fine, at the discretion of the court;
  3. Any person who is neither a licensee nor a holder of authority under this Title found violating any provision thereof or its implementing rules and regulations shall, upon conviction thereof, suffer the penalty of imprisonment of not less than four years nor more than eight years or a fine of not less than P20,000 nor more than P100,000 or both such imprisonment and fine, at the discretion of the court;
  4. If the offender is a corporation, partnership, association or entity, the penalty shall be imposed upon the officer or officers of the corporation, partnership, association or entity responsible for violation; and if such officer is an alien, he shall, in addition to the penalties herein prescribed, be deported without further proceedings;
  5. In every case, conviction shall cause and carry the automatic revocation of the license or authority and all the permits and privileges granted to such person or entity under this Title, and the forfeiture of the cash and surety bonds in favor of the Overseas Employment Development Board or the National Seamen Board, as the case may be, both of which are authorized to use the same exclusively to promote their objectives.

Title II
EMPLOYMENT OF NON-RESIDENT ALIENS

Art. 40. Employment permit of non-resident aliens. Any alien seeking admission to the Philippines for employment purposes and any domestic or foreign employer who desires to engage an alien for employment in the Philippines shall obtain an employment permit from the Department of Labor.

The employment permit may be issued to a non-resident alien or to the applicant employer after a determination of the non-availability of a person in the Philippines who is competent, able and willing at the time of application to perform the services for which the alien is desired.

For an enterprise registered in preferred areas of investments, said employment permit may be issued upon recommendation of the government agency charged with the supervision of said registered enterprise.

Art. 41. Prohibition against transfer of employment.

  1. After the issuance of an employment permit, the alien shall not transfer to another job or change his employer without prior approval of the Secretary of Labor.
  2. Any non-resident alien who shall take up employment in violation of the provision of this Title and its implementing rules and regulations shall be punished in accordance with the provisions of Articles 289 and 290 of the Labor Code.
     
    In addition, the alien worker shall be subject to deportation after service of his sentence.

Art. 42. Submission of list. Any employer employing non-resident foreign nationals on the effective date of this Code shall submit a list of such nationals to the Secretary of Labor within thirty (30) days after such date indicating their names, citizenship, foreign and local addresses, nature of employment and status of stay in the country. The Secretary of Labor shall then determine if they are entitled to an employment permit.

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