omnibus rules implementing the labor code - book 3

7/31/2019 Omnibus Rules Implementing the Labor Code - Book 3

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OMNIBUS RULES

IMPLEMENTING THE LABOR CODE

BOOK THREEConditions of Employment

RULE IHours of Work

SECTION 1 General statement on coverage. The provisions of this Rule shall apply to all employees in all establishments andundertakings, whether operated for profit or not, except to those specifically exempted under Section hereof.

SECTION ! !xemption. The provisions of this Rule shall not apply to the following persons if they "ualify for exemption underthe conditions set forth herein#

$a% Government employees whether employed by the &ational Government or any of its political subdivision, including thoseemployed in government'owned and(or controlled corporations)

$b% *anagerial employees, if they meet all of the following conditions#

$+% Their primary duty consists of the management of the establishment in which they are employed or of a department or sub'division thereof.

$ % They customarily and regularly direct the work of two or more employees therein.

$ % They have the authority to hire or fire employees of lower rank) or their suggestions and recommendations as to hiring andfiring and as to the promotion or any other change of status of other employees, are given particular weight.

$c% -fficers or members of a managerial staff if they perform the following duties and responsibilities#

$+% The primary duty consists of the performance of work directly related to management policies of their employer)

$ % ustomarily and regularly exercise discretion and independent /udgment) and

$ % $i% Regularly and directly assist a proprietor or a managerial employee whose primary duty consists of the management of theestablishment in which he is employed or subdivision thereof) or $ii% execute under general supervision work along speciali0ed ortechnical lines re"uiring special training, experience, or knowledge) or $iii% execute, under general supervision, special assignmentsand tasks) and

$1% 2ho do not devote more than 3 percent of their hours worked in a work week to activities which are not directly and closelyrelated to the performance of the work described in paragraphs $+%, $ % and $ % above.

$d% 4omestic servants and persons in the personal service of another if they perform such services in the employer5s home whichare usually necessary or desirable for the maintenance and en/oyment thereof, or minister to the personal comfort, convenience, orsafety of the employer as well as the members of his employer5s household.


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$e% 2orkers who are paid by results, including those who are paid on piece'work, 6takay,6 6pakiao6 or task basis, and other non'time work if their output rates are in accordance with the standards prescribed under Section 7, Rule 899, :ook Three of theseregulations, or where such rates have been fixed by the Secretary of ;abor and !mployment in accordance with the aforesaidSection.

$f% &on'agricultural field personnel if they regularly perform their duties away from the principal or branch office or place ofbusiness of the employer and whose actual hours of work in the field cannot be determined with reasonable certainty.

SECTION "


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SECTION & *eal and Rest >eriods. !very employer shall give his employees, regardless of sex, not less than one $+% hour time'off for regular meals, except in the following cases when a meal period of not less than twenty $ 3% minutes may be given by theemployer provided that such shorter meal period is credited as compensable hours worked of the employee#

$a% 2here the work is non'manual work in nature or does not involve strenuous physical exertion)

$b% 2here the establishment regularly operates not less than sixteen $+?% hours a day)

$c% 9n case of actual or impending emergencies or there is urgent work to be performed on machineries, e"uipment or installationsto avoid serious loss which the employer would otherwise suffer) and

$d% 2here the work is necessary to prevent serious loss of perishable goods.

Rest periods or coffee breaks running from five $@% to twenty $ 3% minutes shall be considered as compensable working time.

SECTION ' -vertime pay. =ny employee covered by this Rule who is permitted or re"uired to work beyond eight $7% hours onordinary working days shall be paid an additional compensation for the overtime work in the amount e"uivalent to his regularwage plus at least twenty'five percent $ @A% thereof.

SECTION ( >remium and overtime pay for holiday and rest day work. $a% !xcept employees referred to under Section of thisRule, an employee who is permitted or suffered to work on special holidays or on his designated rest days not falling on regularholidays, shall be paid with an additional compensation as premium pay of not less than thirty percent $ 3A% of his regular wage.Bor work performed in excess of eight $7% hours on special holidays and rest days not falling on regular holidays, an employee shallbe paid an additional compensation for the overtime work e"uivalent to his rate for the first eight hours on a special holiday or restday plus at least thirty percent $ 3A% thereof.

$b% !mployees of public utility enterprises as well as those employed in non'profit institutions and organi0ations shall be entitled tothe premium and overtime pay provided herein, unless they are specifically excluded from the coverage of this Rule as provided inSection hereof.

$c% The payment of additional compensation for work performed on regular holidays shall be governed by Rule 98, :ook Three, ofthese Rules.

SECTION 1) ompulsory overtime work. 9n any of the following cases, an employer may re"uire any of his employees to workbeyond eight $7% hours a day, provided that the employee re"uired to render overtime work is paid the additional compensationre"uired by these regulations#

$a% 2hen the country is at war or when any other national or local emergency has been declared by ongress or the hief!xecutive)

$b% 2hen overtime work is necessary to prevent loss of life or property, or in case of imminent danger to public safety due to actualor impending emergency in the locality caused by serious accident, fire, floods, typhoons, earth"uake, epidemic or other disaster orcalamities)

$c% 2hen there is urgent work to be performed on machines, installations, or e"uipment, in order to avoid serious loss or damage tothe employer or some other causes of similar nature)

$d% 2hen the work is necessary to prevent loss or damage to perishable goods)

$e% 2hen the completion or continuation of work started before the 7th hour is necessary to prevent serious obstruction or pre/udiceto the business or operations of the employer) or


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$f% 2hen overtime work is necessary to avail of favorable weather or environmental conditions where performance or "uality ofwork is dependent thereon.

9n cases not falling within any of these enumerated in this Section, no employee may be made to work beyond eight hours a dayagainst his will.

RULE I*+Hours of Work of Hospit,l ,nd Clini- .ersonnel

SECTION 1 General statement on coverage. This Rule shall apply to#

$a% =ll hospitals and clinics, including those with a bed capacity of less than one hundred $+33% which are situated in cities ormunicipalities with a population of one million or more) and

$b% =ll hospitals and clinics with a bed capacity of at least one hundred $+33%, irrespective of the si0e of the population of the city ormunicipality where they may be situated.

SECTION !


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SECTION & -vertime work. 2here the exigencies of the service so re"uire as determined by the employer, any employeecovered by this Rule may be scheduled to work for more than five $@% days or forty $13% hours a week, provided that the employee ispaid for the overtime work an additional compensation e"uivalent to his regular wage plus at least thirty percent $ 3A% thereof,sub/ect to the provisions of this :ook on the payment of additional compensation for work performed on special and regularholidays and on rest days.

SECTION '


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RULE III Weekly Rest .eriods

SECTION 1 General statement on coverage. This Rule shall apply to all employers whether operating for profit or not, includingpublic utilities operated by private persons.

SECTION ! :usiness on Sundays(rovided,


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SECTION & ompensation on rest day(Sunday(holiday. $a% !xcept those employees referred to under Section , Rule 9, :ookThree, an employee who is made or permitted to work on his scheduled rest day shall be paid with an additional compensation ofat least 3A of his regular wage. =n employee shall be entitled to such additional compensation for work performed on a Sundayonly when it is his established rest day.

$b% 2here the nature of the work of the employee is such that he has no regular work days and no regular rest days can bescheduled, he shall be paid an additional compensation of at least 3A of his regular wage for work performed on Sundays andholidays.

$c% 2ork performed on any special holiday shall be paid with an additional compensation of at least 3A of the regular wage of theemployees. 2here such holiday work falls on the employee5s scheduled rest day, he shall be entitled to additional compensation ofat least @3A of his regular wage.

$d% The payment of additional compensation for work performed on regular holiday shall be governed by Rule 98, :ook Three, ofthese regulations.

$e% 2here the collective bargaining agreement or other applicable employment contract stipulates the payment of a higher premiumpay than that prescribed under this Section, the employer shall pay such higher rate.

SECTION ' >aid'off days. &othing in this Rule shall /ustify an employer in reducing the compensation of his employees for theunworked Sundays, holidays, or other rest days which are considered paid'off days or holidays by agreement or practice subsistingupon the effectivity of the ode.

SECTION ( Relation to agreements. &othing herein shall prevent the employer and his employees or their representatives inentering into any agreement with terms more favorable to the employees than those provided herein, or be used to diminish anybenefit granted to the employees under existing laws, agreements, and voluntary employer practices.


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RULE I2Holid,ys 3it0 .,y

SECTION 1 overage. This rule shall apply to all employees except#

$a% Those of the government and any of the political subdivision, including government'owned and controlled corporation)

$b% Those of retail and service establishments regularly employing less than ten $+3% workers)

$c% 4omestic helpers and persons in the personal service of another)

$d% *anagerial employees as defined in :ook Three of the ode)

$e% Bield personnel and other employees whose time and performance is unsupervised by the employer including those who areengaged on task or contract basis, purely commission basis, or those who are paid a fixed amount for performing work irrespectiveof the time consumed in the performance thereof.

SECTION ! Status of employees paid by the month. !mployees who are uniformly paid by the month, irrespective of the

number of working days therein, with a salary of not less than the statutory or established minimum wage shall be paid for all daysin the month whether worked or not.

Bor this purpose, the monthly minimum wage shall not be less than the statutory minimum wage multiplied by ?@ days dividedby twelve.

SECTION " ay. !very employer shall pay his employees their regular daily wage for any worked regular holidays.

=s used in the rule, the term 5regular holiday5 shall exclusively refer to# &ew Dear5s 4ay, *aundy Thursday, Good Briday, the ninthof =pril, the first of *ay, the twelfth of Eune, the last Sunday of =ugust, the thirtieth of &ovember, the twenty'fifth and thirtieth of4ecember. &ationwide special days shall include the first of &ovember and the last day of 4ecember.

=s used in this Rule legal or regular holiday and special holiday shall now be referred to as 5regular holiday5 and 5special day5,respectively.

SECTION # ompensation for holiday work. =ny employee who is permitted or suffered to work on any regular holiday, notexceeding eight $7% hours, shall be paid at least two hundred percent $ 33A% of his regular daily wage. 9f the holiday work falls onthe scheduled rest day of the employee, he shall be entitled to an additional premium pay of at least 3A of his regular holiday rateof 33A based on his regular wage rate.

SECTION $ -vertime pay for holiday work. Bor work performed in excess of eight hours on a regular holiday, an employeeshall be paid an additional compensation for the overtime work e"uivalent to his rate for the first eight hours on such holiday workplus at least 3A thereof.

2here the regular holiday work exceeding eight hours falls on the scheduled rest day of the employee, he shall be paid anadditional compensation for the overtime work e"uivalent to his regular holiday'rest day for the first 7 hours plus 3A thereof. Theregular holiday rest day rate of an employee shall consist of 33A of his regular daily wage rate plus 3A thereof.

SECTION % =bsences. $a% =ll covered employees shall be entitled to the benefit provided herein when they are on leave ofabsence with pay. !mployees who are on leave of absence without pay on the day immediately preceding a regular holiday maynot be paid the re"uired holiday pay if he has not worked on such regular holiday.


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$b% !mployees shall grant the same percentage of the holiday pay as the benefit granted by competent authority in the form ofemployee5s compensation or social security payment, whichever is higher, if they are not reporting for work while on such benefits.

$c% 2here the day immediately preceding the holiday is a non'working day in the establishment or the scheduled rest day of theemployee, he shall not be deemed to be on leave of absence on that day, in which case he shall be entitled to the holiday pay if heworked on the day immediately preceding the non'working day or rest day.

SECTION & Temporary or periodic shutdown and temporary cessation of work. $a% 9n cases of temporary or periodic shutdownand temporary cessation of work of an establishment, as when a yearly inventory or when the repair or cleaning of machineries and

e"uipment is undertaken, the regular holidays falling within the period shall be compensated in accordance with this Rule.

$b% The regular holiday during the cessation of operation of an enterprise due to business reverses as authori0ed by the Secretary of;abor and !mployment may not be paid by the employer.

SECTION ' rivate school teachers, including faculty members of colleges anduniversities, may not be paid for the regular holidays during semestral vacations. They shall, however, be paid for the regularholidays during hristmas vacation)

$b% 2here a covered employee, is paid by results or output, such as payment on piece work, his holiday pay shall not be less thanhis average daily earnings for the last seven $C% actual working days preceding the regular holiday) >rovided,


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RULE 2Ser4i-e In-enti4e Le,4e

SECTION 1 overage. This rule shall apply to all employees except#

$a% Those of the government and any of its political subdivisions, including government'owned and controlled corporations)

$b% 4omestic helpers and persons in the personal service of another)

$c% *anagerial employees as defined in :ook Three of this ode)

$d% Bield personnel and other employees whose performance is unsupervised by the employer including those who are engaged ontask or contract basis, purely commission basis, or those who are paid a fixed amount for performing work irrespective of the timeconsumed in the performance thereof)

$e% Those who are already en/oying the benefit herein provided)

$f% Those en/oying vacation leave with pay of at least five days) and

$g% Those employed in establishments regularly employing less than ten employees.

SECTION ! Right to service incentive leave. !very employee who has rendered at least one year of service shall be entitled to ayearly service incentive leave of five days with pay.

SECTION " 4efinition of certain terms. The term 6at least one'year service6 shall mean service for not less than + months,whether continuous or broken reckoned from the date the employee started working, including authori0ed absences and paidregular holidays unless the working days in the establishment as a matter of practice or policy, or that provided in the employmentcontract is less than + months, in which case said period shall be considered as one year.

SECTION # =ccrual of benefit. !ntitlement to the benefit provided in this Rule shall start 4ecember +?, +FC@, the date theamendatory provision of the ode took effect.

SECTION $ Treatment of benefit. The service incentive leave shall be commutable to its money e"uivalent if not used orexhausted at the end of the year.

SECTION % Relation to agreements. &othing in the Rule shall /ustify an employer from withdrawing or reducing any benefits,supplements or payments as provided in existing individual or collective agreements or employer5s practices or policies.


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RULE 2ISer4i-e C0,r/es

SECTION 1 overage. This rule shall apply only to establishments collecting service charges such as hotels, restaurants, lodginghouses, night clubs, cocktail lounge, massage clinics, bars, casinos and gambling houses, and similar enterprises, including thoseentities operating primarily as private subsidiaries of the Government.

SECTION ! !mployees covered. This rule shall apply 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 to managerial employees.

=s used herein, a 6managerial employee6 shall mean one who is vested with powers or prerogatives to lay down and executemanagement policies and(or to hire, transfer, suspend, lay'off, recall, discharge, assign, or discipline employees or to effectivelyrecommend such managerial actions. =ll employees not falling within this definition shall be considered rank'and'file employees.

SECTION " 4istribution of service charges. =ll service charges collected by covered employers shall be distributed at the rate of7@A for the employees and +@A for the management. The 7@A shall be distributed e"ually among the covered employees. The +@Ashall be for the disposition by management to answer for losses and breakages and distribution to managerial employees at thediscretion of the management in the latter case.

SECTION # Bre"uency of distribution. The shares referred to herein shall be distributed and paid to the employees not less thanonce every two $ % weeks or twice a month at intervals not exceeding sixteen $+?% days.

SECTION $ 9ntegration of service charges. 9n case the service charges is abolished the share of covered employees shall beconsidered integrated in their wages. The basis of the amount to be integrated shall be the average monthly share of each employeefor the past twelve $+ % months immediately preceding the abolition of withdrawal of such charges.

SECTION % Relation to agreements. &othing in this Rule shall prevent the employer and his employees from entering into anyagreement with terms more favorable to the employees than those provided herein, or be used to diminish any benefit granted tothe employees under existing laws, agreement and voluntary employer practice.

SECTION & This rule shall be without pre/udice to existing, future collective bargaining agreements.

&othing in this rule shall be construed to /ustify the reduction or diminution of any benefit being en/oyed by any employee at thetime of effectivity of this rule.


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RULE 2II W,/es

SECTION 1 4efinition of Terms. =s used in this Rules

a% 6=ct6 means Republic =ct &o. ?C C)

b% 6 ommission6 means the &ational 2ages and >roductivity ommission)

c% 6:oard6 means the Regional Tripartite 2ages and >roductivity :oard)

d% 6=griculture6 refers to all farming activities in all its branches and includes among others, the cultivation and tillage of the soil,production, cultivation, growing and harvesting of any agricultural or horticultural commodities, dairying, raising of livestock orpoultry, the culture of fish and other a"uatic products in farms or ponds, and any activities performed by a farmer or on a farm asan incident to or in con/unction with such farming operations, but does not include the manufacturing and(or processing of sugar,coconut, abaca, tobacco, pineapple, a"uatic or other farm products)

e% 6>lantation =gricultural !nterprise6 is one engaged in agriculture within an area of more than 1 hectares in a locality and(or

which employs at least 3 workers. =ny other agricultural enterprise shall be considered as 6&on'>lantation =gricultural!nterprises6)

f% 6Retail !stablishment6 is one principally engaged in the sale of goods to end'users for personal or household use)

g% 6Service !stablishment6 is one primarily engaged in the sale of service to individuals for their own or household use and isgenerally recogni0ed as such)

h% 6 ottage(asig, >ateros, San Euan, Taguig and 8alen0uela)

/% 6Region 9996 covers the provinces of :ataan, :ulacan, &ueva !ci/a, >ampanga, Tarlac, and Jambales and the cities of =ngeles,abanatuan, -longapo, >alayan and San Eose)

k% 6Region 986 covers the provinces of =urora, :atangas, avite, ;aguna, *arindu"ue, -ccidental *indoro, >alawan, Hue0on,Ri0al and Romblon and the cities of :atangas, avite, ;ipa, ;ucena, >uerto >rincesa, San >ablo, Tagaytay and Trece *artires)

l% 64epartment6 refers to the 4epartment of ;abor and !mployment)

m% 6Secretary6 means the Secretary of ;abor and !mployment)

n% 6:asic 2age6 means all remuneration or earnings paid by an employer to a worker for services rendered on normal workingdays and hours but does not include cost'of'living allowances, profit sharing payments, premium payments, + th month pay orother monetary benefits which are not considered as part of or integrated into the regular salary of the workers on the date the =ctbecame effective.6

o% 6Statutory *inimum 2age6 is the lowest wage fixed by law that an employer can pay his workers)


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p% 62age 4istortion6 means a situation where an increase in prescribed wage rates results in the elimination or severe contraction ofintentional "uantitative differences in wage or salary rates between and among employee groups in an establishment as toeffectively obliterate the distinctions embodied in such wage structure based on skills, length of service, or other logical bases ofdifferentiation)

"% 6 apitali0ation6 means paid'up capital, in the case of a corporation, and total invested capital, in the case of a partnership orsingle proprietorship.

CH+.TER I W,/e In-re,se

SECTION 1 overage. The wage increase prescribed under the =ct shall apply to all workers and employees in the privatesector regardless of their position, designation or status, and irrespective of the method by which their wages are paid, except#

a% +33.33 per day.

SECTION ! !ffectivity. The =ct takes effect on Euly +, +F7F, +@ days following its complete publication in two newspapers ofgeneral circulation on Eune +@, +F7F pursuant to Section +@ thereof.

SECTION " =mount of *inimum 2age 9ncrease. !ffective Euly +, +F7F, the daily statutory minimum wage rates of coveredworkers and employees shall be increased as follows#

a% > @.33 for those in the &ational apital Region)

b% > @.33 for those outside the &ational apital Region, except for the following#

> 3.33 for those in plantation agricultural enterprises with an annual gross sales of less than >@ million in the fiscal yearimmediately preceding the effectivity of the =ct)

>[email protected] for those in the following enterprises#

+. &on'plantation agriculture

. ottage(handicraft

. Retail(Service regularly employing not more than +3 workers

1. :usiness enterprises with a capitali0ation of not more than >@33,333 and employing not more than 3 workers.


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SECTION # . 2hen 2age 9ncrease 4ue -ther 2orkers. a% =ll workers and employees who, prior to Euly +, +F7F, were alreadyreceiving a basic wage above the statutory minimum wage rates provided under Republic =ct ??13 but not over >+33.33 per dayshall receive a wage increase e"uivalent to that provided in the preceding Section.

b% Those receiving not more than the following monthly basic wage rates prior to Euly +, +F7F shall be deemed covered by thepreceding subsection#

$i% > , @C.@3 where the workers and employees work everyday, including premium payments for Sundays or rest days, specialdays and regular holidays.

$ii% > ,31+.?C where the workers and employees do not work but considered paid on rest days, special days and regular holidays.

$iii% > ,?+?.?C where the workers and employees do not work and are not considered paid on Sundays or rest days.

$iv% > ,+7 . where the workers and employees do not work and are not considered paid on Saturdays and Sundays or restdays.

c% 2orkers and employees who, prior to Euly +, +F7F, were receiving a basic wage of more than >+33.33 per day or its monthlye"uivalent, are not by law entitled to the wage increase provided under the =ct. They may however, receive wage increasesthrough the correction of wage distortions in accordance with Section +?, hapter 9 of these Rules.

S! T9-& @. 4aily Statutory *inimum 2age Rates. The daily minimum wage rates of workers and employees shall be asfollows#

Sector(9ndustry Knder R. =. ??13 Knder R. =. ?C C$!ffective 4ec. +1, +F7C% $!ffective Euly +, +F7F%

=. &=T9-&=; =>9T=; R!G9-&

&on'=griculture >?1.33 >7F.33

=griculture>lantation @1.33 CF.33

&on'>lantation 1 .@3 ?7.@3

ottage(rivate


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Retail(Service!mploying more than +@workers ?1.33 7F.33

!mploying ++ to +@workers ?3.33 [email protected]

!mploying not more than+3 workers 1 .33 ?7.33

:. -KTS94! &=T9-&=; =>9T=; R!G9-&

&on'=griculture ?1.33 7F.33

=griculture>lantation with annual grosssales of >@* or more @1.33 CF.33

>lantation with annual grosssales of less than >@* @1.33 C1.33

&on'plantation 1 .@3 @7.@3

ottage(rivate lantation w( annual grosssales of >@* or more 17.@3 C .@3


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>lantation w( annual grosssales of less than >@* 17.@3 ?7.@3

&on'plantation 1 .@3 @7.@3

:usiness !nterprises w( apitali0ationof not more than >@33,333 and

employing not more than 3 workers&on'=griculture ?1.33 CF.33

=griculture >lantation>roducts -ther than Sugar @1.33 ?F.33

Sugar 17.@3 ? .@3

>rivate


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??. 3 days @+ rest days x + 3A

.?3 days special days x + 3A

F3.F3 days Total e"uivalent number of days.

b% Bor those who do not work but considered paid on rest days, special days and regular holidays#

=4R x ?@ days

!*R L

+

2here ?@ days L

3 days -rdinary working days

@+ days Rest days

+3 days Regular holidays

days Special days

?@ days Total e"uivalent number of days

c% Bor those who do not work and are not considered paid on Sundays or rest days#

=4R x +1 days

!*R L

+

2here +1 days L

3 days -rdinary working days


days Special days $9f considered

paid) 9f actually worked,

this is e"uivalent to .? days%

+1 days Total e"uivalent number of days

d% Bor those who do not work and are not considered paid on Saturdays or rest days#

=4R x ? days


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!*R L

+

2here ? days L

@3 days -rdinary working days


days Special days $9f considered paid) 9f actually

worked, this is e"uivalent to .? days%

? days Total e"uivalent number of days

Note: For workers whose rest days fall on Sundays, the number of rest days in a year is reduced from 52 to 51 days, the last Sunday of Augustbeing a regular holiday under E ecuti!e "rder No# 2$1# For %ur%oses of com%utation, said holiday, although still a rest day for them, is includedin the ten regular holidays# For workers whose rest days do not fall on Sundays, the number of rest days is 52 days, as there are 52 weeks in ayear#

&othing herein shall be considered as authori0ing the reduction of benefits granted under existing agreements or employerpractices(policies.S! T9-& C. :asis of *inimum 2ages Rates. The statutory minimum wage rules prescribed under the =ctshall be for the normal working hours, which shall not exceed eight hours work a day.

SECTION ' reditable 2age 9ncrease.

a% &o wage increase shall be credited as compliance with the increases prescribed under the =ct unless expressly provided undercollective bargaining agreements) and, such wage increase was granted not earlier than =pril +, +F7F but not later than Euly +, +F7F.2here the wage increase granted is less than the prescribed increase under the =ct, the employer shall pay the difference.

b% =nniversary wage increase provided in collective agreements, merit wage increase, and those resulting from the regulari0ationor promotion of employees shall not be credited as compliance thereto.

SECTION ( 2orkers >aid by Results.

a% =ll workers paid by results, including those who are paid on piecework, takay, pakyaw, or task basis, shall receive not less thanthe applicable statutory minimum wage rates prescribed under the =ct for the normal working hours which shall not exceed eighthours work a day, or a proportion thereof for work of less than the normal working hours.

The ad/usted minimum wage rates for workers paid by results shall be computed in accordance with the following steps#

+% =mount of increase in =*2 ' >revious =*2 x +33 L A 9ncrease)

% !xisting rate(piece x A increase L increase in rate(piece)

% !xisting rate(piece M increase in rate(piece L =d/usted rate(piece.

2here =*2 is the applicable minimum wage rate.


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b% The wage rates of workers who are paid by results shall continue to be established in accordance with =rticle +3+ of the ;aborode, as amended and its implementing regulations.

SECTION 1) 2ages of Special Groups of 2orkers. 2ages of apprentices, learners and handicapped workers shall in no case beless than C@ percent of the applicable statutory minimum wage rates.

=ll recogni0ed learnership and apprenticeship agreements entered into before Euly +, +F7F shall be considered as automatically

modified insofar as their wage clauses are concerned to reflect the increases prescribed under the =ct.

SECTION 11 =pplication to ontractors. 9n the case of contracts for construction pro/ects and for security, /anitorial and similarservices, the prescribed wage increases shall be borne by the principals or clients of the construction(service contractors and thecontract shall be deemed amended accordingly. 9n the event, however, that the principal or client fails to pay the prescribed wagerates, the construction(service contractor shall be /ointly and severally liable with his principal or client.

SECTION 1! =pplication to >rivate !ducational 9nstitution. >rivate educational institutions which increased tuition feesbeginning school year +F7F'+FF3 shall comply with the > @.33 per day wage increase prescribed under the =ct effective as follows#

a% 9n cases where the tuition fee increase was effected before the effectivity of the =ct, the wage increase shall take effect only Euly +,+F7F.

b% 9n cases where the tuition fee increase was effected on or after the effectivity of the =ct, the wage increase shall take effect notlater than the date the school actually increased tuition but in the latter case, such wage increase may not be made retroactive in Euly +, +F7F.

:eginning school year +FF3'+FF+, all schools shall implement the wage increase regardless of whether or not they have actuallyincreased tuition fees.

SECTION 1" *obile and :ranch 2orkers. The statutory minimum wage rates of workers, who by the nature of their work haveto travel, shall be those applicable in the domicile or head office of the employer.

The minimum wage rates of workers working in branches or agencies of establishments in or outside the &ational apital Regionshall be those applicable in the place where they are stationed.

SECTION 1# Transfer of >ersonnel. The transfer of personnel to areas outside the &ational apital Region shall not be a validground for the reduction of the wage rates being en/oyed by the workers prior to such transfer. The workers transferred to the&ational apital Region shall be entitled to the minimum wage rate applicable therein.

SECTION 1$ !xemptions.

a% The following establishments may be exempted from compliance with the wage increase prescribed under the =ct#

+% Retail(Service establishments regularly employing not more than +3 workers upon application with and as determined by theappropriate :oard in accordance with applicable guidelines to be issued by the ommission.

% &ew business enterprises that may be established outside the &ational apital Region and export processing 0ones from Euly +,+F7F to Eune 3, +FF , whose operation or investments need initial assistance may be exempted for not more than three years fromthe start of operations, sub/ect to guidelines to be issued by the Secretary in consultation with the 4epartment of Trade and9ndustry and the 4epartment of =griculture.

&ew business enterprises in Region 999 $ entral ;u0on% and Region 98 $Southern Tagalog% may be exempted for two years onlyfrom start of operations, except those that may be established in the provinces of >alawan, -riental *indoro, -ccidental *indoro,


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*arindu"ue, Romblon, Hue0on and =urora, which may also be exempted for not more than three years from the start ofoperations.

b% 2henever an application for exemption has been duly filed with the appropriate office in the 4epartment(:oard, action by theRegional -ffice of the 4epartment on any complaints for alleged non'compliance with the =ct shall be deferred pending resolutionof the applicant for exemption.

c% 9n the event that the application for exemption is not granted, the workers and employees shall receive the appropriatecompensation due them as provided for under the =ct plus interest of one percent per month retroactive to Euly +, +F7F or the startof operations whichever is applicable.

SECTION 1% !ffects on !xisting 2age Structure. 2here the application of the wage increase prescribed herein results indistortions in the wage structure within an establishment which gives rise to a dispute therein, such dispute shall first be settledvoluntarily between the parties. 9n the event of a deadlock, such dispute shall be finally resolved through compulsory arbitration bythe regional arbitration branch of the &ational ;abor Relations ommission $&;R % having /urisdiction over the workplace.

The &;R shall conduct continuous hearings and decide any dispute arising from wage distortions within twenty calendar daysfrom the time said dispute is formally submitted to it for arbitration. The pendency of a dispute arising from a wage distortion shallnot in any way delay the applicability of the increases in the wage rates prescribed under the =ct.

=ny issue involving wage distortion shall not be a ground for a strike(lockout.

SECTION 1& omplaints for &on' ompliance. omplaints for non'compliance with the wage increases prescribed under the=ct shall be filed with the Regional -ffices of the 4epartment having /urisdiction over the workplace and shall be the sub/ect ofenforcement proceedings under =rticles + 7 and + F of the ;abor ode, as amended.

SECTION 1' onduct of inspection by the 4epartment. The 4epartment shall conduct inspections of establishments, as often asnecessary, to determine whether the workers are paid the prescribed wage rates and other benefits granted by law or any 2age-rder. 9n the conduct of inspection in unioni0ed companies, 4epartment inspectors shall always be accompanied by the presidentor other responsible officer of the recogni0ed bargaining unit or of any interested union. 9n the case of non'unioni0edestablishments, a worker representing the workers in the said company shall accompany the inspector.

The worker5s representative shall have the right to submit his own findings to the 4epartment and to testify on the same if he doesnot concur with the findings of the labor inspector.

SECTION 1( >ayment of 2ages. Kpon written petition of the ma/ority of the workers and employees concerned, all privateestablishments, companies, businesses and other entities with at least twenty workers and located within one kilometer radius to acommercial, savings or rural bank, shall pay the wages and other benefits of their workers through any of said banks, within theperiod and in the manner and form prescribed under the ;abor ode as amended.

SECTION !) 4uty of :ank. 2henever applicable and upon re"uest of concerned worker or union, the bank through which

wages and other benefits are paid issue a certification of the record of payment of said wages and benefits of a particular worker orworkers for a particular payroll period.


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CH+.TER IIT0e N,tion,l W,/es ,nd .rodu-ti4ity Commission ,nd Re/ion,l Trip,rtite W,/es ,nd

.rodu-ti4ity Bo,rds

SECTION 1 ommission. The &ational 2ages and >roductivity ommission created under the =ct shall hold office in the&ational apital Region. The ommission shall be attached to the 4epartment for policy and program coordination.

SECTION ! >owers and Bunctions of the ommission. The ommission shall have the following powers and functions#

a% To act as the national consultative and advisory body to the >resident of the >hilippines and ongress on matters relating towages, incomes and productivity)

b% To formulate policies and guidelines on wages, incomes and productivity improvement at the enterprise, industry and nationallevels)

c% To prescribe rules and guidelines for the determination of appropriate minimum wage and productivity measures at the regional,provincial or industry levels)

d% To review regional wage levels set by the Regional Tripartite 2ages and >roductivity :oard to determine if these are inaccordance with prescribed guidelines and national development plans)

e% To undertake studies, researches and surveys necessary for the attainment of its functions and ob/ectives, and to collect andcompile data and periodically disseminate information on wages and productivity and other related information, including, but notlimited to, employment, cost'of'living, labor costs, investments and returns)

f% To review plans and programs of the Regional Tripartite 2ages and >roductivity :oards to determine whether these areconsistent with national development plans)

g% To exercise technical and administrative supervision over the Regional Tripartite 2ages and >roductivity :oards)

h% To call, from time to time, a national tripartite conference of representatives of government, workers and employers for theconsideration of measures to promote wage rationali0ation and productivity) and

i% To exercise such powers and functions as may be necessary to implement this =ct.

SECTION " omposition of the ommission. The ommission shall be composed of the Secretary as ex'officio hairman, the4irector General of the &ational !conomic and 4evelopment =uthority $&!4=% as ex'officio 8ice' hairman and two memberseach from workers and employers sectors who shall be appointed by the >resident for a term of five years upon recommendation ofthe Secretary. The recommendees shall be selected from the lists of nominees submitted by the workers5 and employers5 sectors. The!xecutive 4irector of the ommission Secretariat shall be also a member of the ommission.

The members of the ommission representing labor and management shall have the same rank, emoluments, allowances and otherbenefits as those prescribed by law for labor and management representatives in the !mployees5 ompensation ommission.

SECTION # ommission Secretariat. The ommission shall be assisted by a Secretariat to be headed by an !xecutive 4irectorand two 4eputy 4irectors who shall be appointed by the >resident upon recommendation of the Secretary.

The !xecutive 4irector shall have the rank of a 4epartment =ssistant Secretary, while the 4eputy 4irectors that of a :ureau4irector. The !xecutive 4irector and 4eputy 4irectors shall receive the corresponding salary, benefits and other emoluments of thepositions.


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SECTION $ Regional Tripartite 2ages and >roductivity :oards. The Regional 2ages and >roductivity :oards created underthe =ct in all regions, including autonomous regions as may be established by law, shall hold offices in areas where the Regional-ffices of the 4epartment are located.

SECTION % >owers and Bunctions of the :oards. The :oards shall have the following powers and functions#

a% To develop plans, programs and pro/ects relative to wages, incomes and productivity improvement for their respective regions)

b% To determine and fix minimum wage rates applicable in their region, provinces or industries therein and to issue thecorresponding wage orders, sub/ect to guidelines issued by the ommission)

c% To undertake studies, researches, and surveys necessary for the attainment of their functions, ob/ectives and programs, and tocollect and compile data on wages, incomes, productivity and other related information and periodically disseminate the same)

d% To coordinate with the other :oards as may be necessary to attain the policy and intention of the ;abor ode)

e% To receive, process and act on applications for exemption from prescribed wage rates as may be provided by law or any 2age-rder) and

f% To exercise such other powers and functions as may be necessary to carry out their mandate under the ;abor ode.

9mplementation of the plans, programs and pro/ects of the :oards shall be through the respective Regional -ffices of the4epartment, provided, however, that the :oards shall have technical supervision over the Regional -ffice of the 4epartment withrespect to the implementation of these plans, programs and pro/ects.

SECTION & ompositions of the :oards. !ach :oard shall be composed of the Regional 4irector of the 4epartment ashairman, the Regional 4irectors of the &ational !conomic and 4evelopment =uthority $&!4=% and 4epartment of Trade and

9ndustry $4T9% as 8ice' hairmen and two members each of workers and employers sectors who shall be appointed by the >residentfor a term of five years upon the recommendation of the Secretary. The recommendees shall be selected from the list of nomineessubmitted by the workers and employers sectors.

!ach :oard shall be assisted by a Secretariat.

SECTION ' =uthority to -rgani0e and =ppoint >ersonnel. The hairman of the ommission shall organi0e such units andappoint the necessary personnel of the ommission and :oard Secretaries, sub/ect to pertinent laws, rules and regulations.

CH+.TER III5inimum W,/e etermin,tion

SECTION 1 Regional *inimum 2ages. The minimum wage rates for agricultural and non'agricultural workers and employeesin every region shall be those prescribed by the :oards which shall in no case be lower than the statutory minimum wage rates.These wage rates may include wages by industry, province or locality as may be deemed necessary by the :oards.

SECTION ! Standards( riteria for *inimum 2age Bixing. The regional minimum wages to be established by the :oards shallbe as nearly ade"uate as is economically feasible to maintain the minimum standards of living necessary for the health, efficiencyand general well'being of the workers within the framework of the national economic and social development programs. 9n thedetermination of regional minimum wages, the :oards, shall, among other relevant factors, consider the following#

a% The demand for living wages)


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b% 2age ad/ustment vis'a'vis the consumer price index)

c% The cost of living and changes or increases therein)

d% The needs of workers and their families)

e% The need to induce industries to invest in countryside)

f% 9mprovements in standards of living)

g% The prevailing wage levels)

h% Bair return of the capital invested and capacity to pay of employers)

i% !ffects on employment generation and family income) and

/% The e"uitable distribution of income and wealth along the imperatives of economic and social development.

SECTION " 2age -rder. 2henever conditions in the region so warrant, the :oard shall investigate and study all pertinentfacts) and, based on standards and criteria prescribed herein, shall determine whether a 2age -rder should be issued.

9n the performance of its wage determining functions, the :oard shall conduct public hearings and consultations giving notices toemployees5 and employers5 groups, provincial, city and municipal officials and other interested parties.

SECTION # !ffectivity of 2age -rder. =ny 2age -rder issued by the :oard shall take effect +@ days after its completepublication in at least one newspaper of general circulation in the region.

SECTION $ =ppeal to the ommission. =ny party aggrieved by the 2age -rder issued by the :oard may file an appeal withthe ommission within ten calendar days from the publication of the -rder. The ommission shall decide the appeal within sixtycalendar days from the date of filing.

SECTION % !ffect of =ppeal. The filing of the appeal shall not suspend the effectivity of the 2age -rder unless the personappealing such order files with the ommission an undertaking with a surety or sureties in such amount as may be fixed by the

ommission.

SECTION & 2age 4istortions. 2here the application of any wage increase resulting from a 2age -rder issued by any :oardresults in distortions in the wage structure within an establishment, the employer and the union shall negotiate to correct thedistortions using the grievance procedure under their collective bargaining agreement. 9f it remains unresolved, it shall be decidedthrough voluntary arbitration ten calendar days from the time the dispute was referred for voluntary arbitration, unless otherwiseagreed by the parties in writing.

2here there are no collective agreements or recogni0ed labor unions, the employer and workers shall endeavor to correct the wagedistortion. =ny dispute arising therefrom shall be settled through the &ational onciliation and *ediation :oard and if it remainsunresolved after ten calendar days of conciliation, it shall be referred to the appropriate branch of the &ational ;abor Relations

ommission $&;R %. The &;R shall conduct continuous hearings and decide the dispute within twenty calendar days from thetime said dispute is submitted for compulsory arbitration.

The pendency of a dispute arising from a wage distortion shall not in any way delay the applicability of any wage increaseprescribed pursuant to the provisions of law or 2age -rder.


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SECTION ' &on'4iminution of :enefits. &othing in the =ct and in these Rules shall be construed to reduce any existing laws,decrees, issuances, executive orders, and(or under any contract or agreement between the workers and employers.

SECTION ( >rohibition =gainst 9n/unction. &o preliminary or permanent in/unction or temporary restraining order may beissued by any court, tribunal or other entity against any proceedings before the ommission or :oards.

SECTION 1) >enal >rovisions. =ny person, corporation trust, firm, partnership, association or entity which refuses or fails to

pay any of the prescribed increases or ad/ustments in the wage rates made in accordance with the =ct shall be punished by a finenot exceeding > @,333 and(or imprisonment of not less than one year nor more than two years# >rovided, that any personconvicted under the =ct shall not be entitled to the benefits provided for under the >robation ;aw.

9f the violation is committed by a corporation, trust or firm, partnership, association or any other entity, the penalty ofimprisonment shall be imposed upon the entity5s responsible officers, including, but not limited to, the president, vice'president,chief executive officer, general manager, managing director or partner.

SECTION 11 Registration(Reporting Re"uirement. =ny person, company, corporation, partnership or any other entity engagedin business shall submit annually a verified itemi0ed listing of their labor component to the appropriate :oard and the &ationalStatistics -ffice not later than Eanuary + of each year, starting on Eanuary +, +FF3 in accordance with the form to be prescribed bythe ommission. The listing shall specify the names, salaries and wages of their workers and employees below the managerial levelincluding learners, apprentices and disabled(handicapped workers.

CH+.TER I2Tr,nsitory .ro4isions

SECTION 1 =bolition of the &ational 2ages ouncil and the &ational >roductivity ommission. The &ational 2ages ouncilcreated under !xecutive -rder &o. ?+1 and the &ational >roductivity ommission created under !xecutive -rder &o. ?+@ areabolished. =ll properties, records, e"uipment, buildings, facilities, and other assets, liabilities and appropriations of and belongingto the abovementioned offices, as well as other matters pending herein, shall be transferred to the ommission. =ll personnel of theabove abolished offices shall continue to function in a hold'over capacity and shall be preferentially considered for appointments toor placements in the ommission(:oards.

=ny official or employee separated from the service as a result of the abolition of offices pursuant to the =ct shall be entitled toappropriate separation pay of one month salary for every year of service and(or retirement and other benefits accruing to themunder existing laws. 9n lieu thereof, at the option of the employee, he shall be preferentially considered for employment in thegovernment or in any of its subdivisions, instrumentalities, or agencies, including government owned or controlled corporationsand their subsidiaries.

SECTION ! 9nterim >rocessing of =pplications for !xemption and Submission of Reports. >ending the operationali0ation of theommission and :oards, the &ational 2ages ouncil shall, in the interim, receive and process applications for exemption sub/ect to

guidelines to be issued by the Secretary, in accordance with Section ++ of the =ct.

Reports of establishments on their labor component, including wages and salaries of their workers prescribed under the =ct, shallbe submitted to the &ational 2ages ouncil through the Regional -ffices of the 4epartment.

SECTION " Bunding Re"uirement. The funds necessary to carry out the provisions of the =ct shall be taken from theompensation and -rgani0ation =d/ustment Bund, the ontingent Bund, and other savings under Republic =ct &o. ??77,

otherwise known as the General =ppropriations =ct of +F7F, or from any unappropriated funds of the &ational Treasury) >rovided,that the funding re"uirements necessary to implement the =ct shall be included in the annual General =ppropriations =ct for thesucceeding years.


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SECTION # Repealing lause. =ll laws, orders, issuances, rules and regulations or parts thereof inconsistent with the provisionsof the =ct and this Rules are hereby repealed, amended or modified accordingly. 9f any provision or part of the =ct and this Rules,or the application thereof to any person or circumstance is held invalid or unconstitutional, the remainder of the =ct and theseRules or the application of such provision or part thereof to other persons or circumstance shall not be affected thereby.

SECTION $ !ffectivity. These rules shall take effect on Euly +, +F7F.


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RULE 2III.,yment of W,/es

SECTION 1 *anner of wage payment. =s a general rule, wages shall be paid in legal tender and the use of tokens, promissorynotes, vouchers, coupons, or any other form alleged to represent legal tender is absolutely prohibited even when expresslyre"uested by the employee.

SECTION ! >ayment by check. >ayment of wages by bank checks, postal checks or money orders is allowed where suchmanner of wage payment is customary on the date of the effectivity of the ode, where it is so stipulated in a collective agreement,or where all of the following conditions are met#

$a% There is a bank or other facility for encashment within a radius of one $+% kilometer from the workplace)

$b% The employer or any of his agents or representatives does not receive any pecuniary benefit directly or indirectly from thearrangement)

$c% The employees are given reasonable time during banking hours to withdraw their wages from the bank which time shall beconsidered as compensable hours worked if done during working hours) and

$d% The payment by check is with the written consent of the employees concerned if there is no collective agreement authori0ing thepayment of wages by bank checks.

SECTION " Time of payment. $a% 2ages shall be paid not less than once every two $ % weeks or twice a month at intervals notexceeding sixteen $+?% days, unless payment cannot be made with such regularity due to force ma/eure or circumstances beyond theemployer5s control in which case the employer shall pay the wages immediately after such force ma/eure or circumstances haveceased.

$b% 9n case of payment of wages by results involving work which cannot be finished in two $ % weeks, payment shall be made atintervals not exceeding sixteen days in proportion to the amount of work completed. Binal settlement shall be made immediatelyupon completion of the work.

SECTION # >lace of payment. =s a general rule, the place of payment shall be at or near the place of undertaking. >ayment in aplace other than the work place shall be permissible only under the following circumstances#

$a% 2hen payment cannot be effected at or near the place of work by reason of the deterioration of peace and order conditions, or byreason of actual or impending emergencies caused by fire, flood, epidemic or other calamity rendering payment thereat impossible)

$b% 2hen the employer provides free transportation to the employees back and forth) and

$c% Knder any other analogous circumstances) >rovided, That the time spent by the employees in collecting their wages shall beconsidered as compensable hours worked)

$d% &o employer shall pay his employees in any bar, night or day club, drinking establishment, massage clinic, dance hall, or othersimilar places or in places where games are played with stakes of money or things representing money except in the case of personsemployed in said places.

SECTION $ 4irect payment of wages. >ayment of wages shall be made direct to the employee entitled thereto except in thefollowing cases#

$a% 2here the employer is authori0ed in writing by the employee to pay his wages to a member of his family)


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$b% 2here payment to another person of any part of the employee5s wages is authori0ed by existing law, including payments for theinsurance premiums of the employee and union dues where the right to check'off has been recogni0ed by the employer inaccordance with a collective agreement or authori0ed in writing by the individual employees concerned) or

$c% 9n case of death of the employee as provided in the succeeding Section.

SECTION % . 2ages of deceased employee. The payment of the wages of a deceased employee shall be made to his heirs without

the necessity of intestate proceedings. 2hen the heirs are of age, they shall execute an affidavit attesting to their relationship to thedeceased and the fact that they are his heirs to the exclusion of all other persons. 9n case any of the heirs is a minor, such affidavitshall be executed in his behalf by his natural guardian or next of kin. Kpon presentation of the affidavit to the employer, he shallmake payment to the heirs as representative of the Secretary of ;abor and !mployment.

SECTION & ivil liability of employer and contractors. !very employer or indirect employer shall be /ointly and severally liablewith his contractor or sub'contractor for the unpaid wages of the employees of the latter. Such employer or indirect employer mayre"uire the contractor or sub'contractor to furnish a bond e"ual to the cost of labor under contract on condition that the bond willanswer for the wages due the employees should the contractor or subcontractor, as the case may be, fail to pay the same.

SECTION ' Eob ontracting. There is /ob contracting permissible under the ode if the following conditions are met#

$a% The contractor carries on an independent business and undertakes the contract work on his own account under his ownresponsibility according to his own manner and method, free from the control and direction of his employer or principal in allmatters connected with the performance of the work except as to the results thereof) and

$b% The contractor has substantial capital or investment in the form of tools, e"uipment, machineries, work premises, and othermaterials which are necessary in the conduct of his business.

SECTION ( ;abor'only contracting. $a% =ny person who undertakes to supply workers to an employer shall be deemed to beengaged in labor'only contracting where such person#

$+% 4oes not have substantial capital or investment in the form of tools, e"uipment, machineries, work premises and other materials)and

$ % The workers recruited and placed by such person are performing activities which are directly related to the principal business oroperations of the employer in which workers are habitually employed.

$b% ;abor'only contracting as defined herein is hereby prohibited and the person acting as contractor shall be considered merely asan agent or intermediary of the employer who shall be responsible to the workers in the same manner and extent as if the latterwere directly employed by him.

$c% Bor cases not falling under this Rule, the Secretary of ;abor and !mployment shall determine through appropriate orderswhether or not the contracting out of labor is permissible in the light of the circumstances of each case and after considering the

operating needs of the employer and the rights of the workers involved. 9n such case, he may prescribe conditions and restrictionsto insure the protection and welfare of the workers.

SECTION 1) >ayment of wages in case of bankruptcy. Knpaid wages earned by the employees before the declaration ofbankruptcy or /udicial li"uidation of the employer5s business shall be given first preference and shall be paid in full before othercreditors may establish any claim to a share in the assets of the employer.

SECTION 11 . =ttorney5s fees. =ttorney5s fees in any /udicial or administrative proceedings for the recovery of wages shall notexceed +3 percent of the amount awarded. The fees may be deducted from the total amount due the winning party.


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SECTION 1! &on'interference in disposal of wages. &o employer shall limit or otherwise interfere with the freedom of anyemployee to dispose of his wages and no employer shall in any manner oblige any of his employees to patroni0e any store or availof the services offered by any person.

SECTION 1" 2ages deduction. 4eductions from the wages of the employees may be made by the employer in any of thefollowing cases#

$a% 2hen the deductions are authori0ed by law, including deductions for the insurance premiums advanced by the employer inbehalf of the employee as well as union dues where the right to check'off has been recogni0ed by the employer or authori0ed inwriting by the individual employee himself.

$b% 2hen the deductions are with the written authori0ation of the employees for payment to the third person and the employeragrees to do so) >rovided, That the latter does not receive any pecuniary benefit, directly or indirectly, from the transaction.

SECTION 1# 4eduction for loss or damage. 2here the employer is engaged in a trade, occupation or business where thepractice of making deductions or re"uiring deposits is recogni0ed to answer for the reimbursement of loss or damage to tools,materials, or e"uipment supplied by the employer to the employee, the employer may make wage deductions or re"uire theemployees to make deposits from which deductions shall be made, sub/ect to the following conditions#

$a% That the employee concerned is clearly shown to be responsible for the loss or damage)

$b% That the employee is given reasonable opportunity to show cause why deduction should not be made)

$c% That the amount of such deduction is fair and reasonable and shall not exceed the actual loss or damage) and

$d% That the deduction from the wages of the employee does not exceed 3 percent of the employee5s wages in a week.


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RULE I6 W,/e Studies ,nd etermin,tion

SECTION 1 4efinition of terms. $a% 69ndustry6 shall mean any identifiable group of productive units or enterprises, whetheroperated for profit or not, engaged in similar or allied economic activities in which individuals are gainfully employed.

$b% = 6branch6 of an industry is a work, product or service grouping thereof which can be considered a distinct division for wage'

fixing purposes.

$c% 6Substantial number6 shall mean such an appreciable number of employees in an industry as, in the ommission5s opinion,considering all relevant facts, may re"uire action under =rt. + + of the ode to effectuate the purposes of wage determination,regardless of the proportion of such employees to the total number of employees in the industry.

SECTION ! 2age studies. The &ational 2ages ouncil shall conduct a continuing study of wage rates and other economicconditions in all industries, agricultural and non'agricultural. The results of such study shall be periodically disseminated to thegovernment, labor and management sectors for their information and guidance.

SECTION " 2ages recommendation. 9f after such study, the ommission is of the opinion that a substantial number ofemployees in any given industry or branch thereof are receiving wages, which although complying with the minimum provided bylaw, are less than sufficient to maintain them in health, efficiency and general well'being, taking into account, among others, thepeculiar circumstances of the industry and its geographical location, the ommission shall, with the approval of the Secretary of;abor and !mployment, proceed to determine whether a wage recommendation should be issued.

SECTION # riteria for wage fixing. $a% 9n addition to the criteria established by =rt. + of the ode for minimum wage fixing,the ommission shall consider, among other factors, social services and benefits given free to workers and the possible effect of agiven increase in the minimum wage on prices, money supply, employment, labor mobility and productivity, labor organi0ationefficacy, domestic and foreign trade, and other relevant indicators of social and economic development.

$b% 2here a fair return to capital invested cannot be reasonably determined, or where the industry concerned is not operated forprofit, its capacity to pay, taking into account all resources available to it, shall be considered.

SECTION $ Huorum. Three $ % members of the ommission, including its hairman, shall constitute a "uorum to transact theommission5s business.

SECTION % ommission actions, number of votes re"uired. The votes of at least three $ % members of the ommission shall benecessary to effect any decision or recommendation it is authori0ed to issue under the ode and this rule# >rovided, That in theinternal regulation and direction of the functions of the ommission5s staff including the conduct of administrative processes andthe maintenance of proper liaison and coordination with other organi0ations, the hairman shall not need the consent of the

ommission or any member thereof.

SECTION & -utside assistance. The ommission may call upon the assistance and cooperation of any government agency orofficial, and may invite any private person or organi0ation to furnish information in connection with industry studies and wagefixing hearings or in aid of the ommission5s deliberations.

SECTION ' Schedule of hearings and notices. The ommission shall prepare a schedule of hearings for the reception ofevidence necessary for wage fixing in an industry, including a list of witnesses that it will invite and the date, time and place of thehearings. = notice thereof to all sectors of the industry shall be given in the most expeditious manner. 9t may have priorconsultations with labor and management leaders in the industry for the above purpose.

SECTION ( Knsolicited testimony. >ersons who offer to testify before the ommission shall be heard only after theommission is satisfied, upon brief preliminary examination, that they are in possession of facts relevant to the sub/ect of in"uiry.


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The hairman, or in other cases, the person conducting the hearing, shall revise the schedule of hearings whenever necessary toachieve logical se"uence of testimony.

SECTION 1) ompulsory processes. Recourse to compulsory processes under the Revised =dministrative ode to ensure theattendance of witnesses and(or the production of relevant documentary evidence shall be used only on occasions of extremeimportance and after other means shall have failed, sub/ect to the approval of the Secretary of ;abor and !mployment.

SECTION 11 resident of the >hilippines, prescribing the minimum wage or wages for the industry concerned.

SECTION 1( 2age -rder. The 2age -rder shall specify the industry or branch to which the minimum wages prescribedtherein shall apply) >rovided, That no definite rates shall be prescribed for specific /ob titles in the industry.

SECTION !) 8arying minimum wages. To /ustify different minimum wages for different localities, the economic and other

conditions found in a particular locality must not only be more or less uniform therein but also different from those prevailing inother localities.

SECTION !1 >ublication of 2age -rder. -nly such portions of a 2age -rder shall be published as shall effectively give noticeto all interested parties that such an -rder has been issued, the industry affected, the minimum wages prescribed and the date of itseffectivity.

SECTION !! !ffectivity. = 2age -rder shall become effective after fifteen $+@% days from its publication as provided in =rticle+ 1 of the ode.


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SECTION !" 9nternal rules of the ommission. Sub/ect to the approval of the Secretary of ;abor and !mployment, the &ational2ages ouncil may issue rules and regulations governing its internal procedure.


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RULE 6+dministr,tion ,nd Enfor-ement

SECTION 1 8isitorial power. The Secretary of ;abor and !mployment or his duly authori0ed representatives, including ;aborRegulations -fficers or 9ndustrial Safety !ngineers, shall have access to employer5s records and premises at any time of the day ornight whenever work is being undertaken therein, and right to copy therefrom, to "uestion any employee, and to investigate anyfact, condition or matter relevant to the enforcement of any provision of the ode and of any labor law, wage order or rules and

regulations issued pursuant thereto.

SECTION ! !nforcement power. $a% The Regional 4irector in cases where employer relations shall exist, shall have the power toorder and administer, after due notice and hearing, compliance with the labor standards provisions of the ode and other laborlegislations based on the findings of the ;abor Regulation -fficers or 9ndustrial Safety !ngineers $;abor Standard and 2elfare-fficer% and made in the course of inspection, and to issue writs of execution to the appropriate authority of the enforcement of hisorder. 9n line with the provisions of =rticle + 7 in relation to =rticles 7F and F3 of the ;abor ode as amended in cases, however,where the employer contests the findings of the ;abor Standards and 2elfare -fficers and raises issues which cannot be resolvedwithout considering evidentiary matters that are not verifiable in the normal course of inspection, the Regional 4irector concernedshall indorse the case to the appropriate arbitration branch of the &ational ;abor Relations ommission for ad/udication.

$b% The Regional 4irector shall give the employer fifteen $+@% days within which to comply with his order before issuing a writ ofexecution. opy of such order or writ of execution shall immediately be furnished the Secretary of ;abor and !mployment.

SECTION " !nforcement power on health and safety of workers. $a% The Regional 4irector may likewise order stoppage ofwork or suspension of operations of any unit or department of an establishment when non'compliance with the law, safety order orimplementing rules and regulations poses grave and imminent danger to the health and safety of workers in the workplace.

$b% 2ithin 1 hours from issuance of the order of stoppage or suspension, a hearing shall be conducted to determine whether theorder for the stoppage of work or suspension of operation shall be lifted or not. The proceedings shall be terminated withinseventy'two $C % hours and a copy of such order or resolution shall be immediately furnished the Secretary of ;abor and!mployment. 9n case the violation is attributable to the fault of the employer, he shall pay the employees concerned their salaries orwages during the period of such stoppage of work or suspension of operation.

SECTION # >ower to review. $a% The Secretary of ;abor and !mployment, at his own initiative or upon re"uest of the employerand(or employee, may review the order of the Regional 4irector. The order of the Regional 4irector shall be immediately final andexecutory unless stayed by the Secretary of ;abor and !mployment upon posting by the employer of a reasonable cash or suretybond as fixed by the Regional 4irector.

$b% 9n aid of his power of review, the Secretary of ;abor and !mployment may direct the :ureau of 2orking onditions to evaluatethe findings or orders of the Regional 4irector. The decision of the Secretary of ;abor and !mployment shall be final and executory.

SECTION $ 9nterference and in/unctions prohibited. 9t shall be unlawful for any person or entity to obstruct, impede, delay orotherwise render ineffective the exercise of the enforcement power of the Secretary of ;abor and !mployment, Regional 4irector ortheir duly authori0ed representatives pursuant to the authority granted by the ode and its implementing rules and regulations,and no inferior court or entity shall issue temporary or permanent in/unction or restraining order or otherwise assume /urisdictionover any case involving the enforcement orders issued in accordance with the ode. 9n addition to the penalties provided for by the;abor ode, any government employees found guilty of violation or abuse of authority, shall be sub/ect to the provisions of>residential 4ecree &o. ?.

SECTION % >ayrolls. $a% !very employer shall pay his employees by means of a payroll wherein the following information anddata shall be individually shown#

$+% ;ength of time to be paid)


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$ % The rate of pay per month, week, day or hour piece, etc.)

$ % The amount due for regular work)

$1% The amount due for overtime work)

$@% 4eductions made from the wages of the employees) and

$?% =mount actually paid.

$b% !very employee in the payroll shall sign or place his thumbmark, as the case may be, at the end of the line opposite his namewhere a blank space shall be provided for the purpose. reservation of records. =ll employment records re"uired to be kept and maintained by employers shall bepreserved for at least three $ % years from the date of the last entry in the records.


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SECTION 1" Balse reporting. 9t shall be unlawful for any employer or any person to make any false statement, report or recordon matters re"uired to be kept or maintained pursuant to the provisions of this Rule.

SECTION 1# 2orking scholars. There is no employer'employee relationship between students on one hand, and schools,colleges or universities on the other, where there is written agreement between them under which the former agree to work for thelatter in exchange for the privilege to study free of charge, provided the students are given real opportunities, including suchfacilities as may be reasonable and necessary to finish their chosen courses under such agreement.

SECTION 1$ Resident physicians in training. There is employer'employee relationship between resident physicians and thetraining hospital unless#

$+% There is a training agreement between them) and

$ % The training program is duly accredited or approved by the appropriate government agency.

&othing herein shall sanction the diminution or withdrawal of any existing allowances, benefits and facilities being en/oyed bytraining resident physicians at the time of the effectivity of this Rule.


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RULE 6I+d7udi-,tory .o3ers

SECTION 1 Recovery of wages, simple money claims and other benefits. $a% The Regional 4irector or any duly authori0ed


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RULE 6IIEmployment of Women ,nd 5inors

SECTION 1 General statement on coverage. This Rule shall apply to all employers, whether operating for profit or not,including educational, religious and charitable institutions, except to the Government and to government'owned or controlledcorporations and to employers of household helpers and persons in their personal service insofar as such workers are concerned.

SECTION ! !mployable age. hildren below fifteen $+@% years of age may be allowed to work under the direct responsibility oftheir parents or guardians in any non'ha0ardous undertaking where the work will not in any way interfere with their schooling. 9nsuch cases, the children shall not be considered as employees of the employers or their parents or guardians.

SECTION " !ligibility for employment. =ny person of either sex, between +@ and +7 years of age, may be employed in any non'ha0ardous work. &o employer shall discriminate against such person in regard to terms and conditions of employment on accountof his age.

Bor purposes of this Rule, a non'ha0ardous work or undertaking shall mean any work or activity in which the employee is notexposed to any risk which constitutes an imminent danger to his safety and health. The Secretary of ;abor and !mployment shallfrom time to time publish a list of ha0ardous work and activities in which persons +7 years of age and below cannot be employed.

SECTION # Status of women workers in certain work places. =ny woman who is permitted or suffered to work with or withoutcompensation, in any night club, cocktail lounge, beer house, massage clinic, bar or similar establishments, under the effectivecontrol or supervision of the employer for a substantial period of time as determined by the Secretary of ;abor and !mployment,shall be considered as an employee of such establishments for purposes of labor and social legislation. &o employer shalldiscriminate against such employees or in any manner reduce whatever benefits they are now en/oying by reason of the provisionsof this Section.

SECTION $ &ight work of women employees. =ny woman employed in any industrial undertaking may be allowed to workbeyond +3#33 o5clock at night, or beyond + #33 o5clock midnight in the case of women employees of commercial or non'industrialenterprises, in any of the following cases#

$a% 9n cases of actual or impending emergencies caused by serious accident, fire, flood, typhoon, earth"uakes, epidemic or otherdisaster or calamity, to prevent loss of life or property or in cases of force ma/eure or imminent danger to public safety)

$b% 9n case of urgent work to be performed on machineries, e"uipment or installation, to avoid serious loss which the employerwould otherwise suffer)

$c% 2here the work is necessary to prevent serious loss of perishable goods)

$d% 2here the woman employee holds a responsible position of a managerial or technical nature, or where the woman employeehas been engaged to provide health and welfare services)

$e% 2here the nature of the work re"uires the manual skill and dexterity of women and the same cannot be performed with e"ualefficiency by male workers or where the employment of women is the established practice in the enterprises concerned on the datethese Rules become effective) and

$f% 2here the women employees are immediate members of the family operating the establishment or undertaking.

The Secretary of ;abor and !mployment shall from time to time determine cases analogous to the foregoing for purposes of thisSection.


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SECTION % =gricultural work. &o woman, regardless of age, shall be permitted or suffered to work, with or withoutcompensation, in any agricultural undertaking at night time unless she is given a rest period of not less than nine $F% consecutivehours, sub/ect to the provisions of Section @ of this Rule.

SECTION & *aternity leave benefits. !very employer shall grant to a pregnant woman employee who has rendered anaggregate service of at least six $?% months for the last twelve $+ % months immediately preceding the expected date of delivery, orthe complete abortion or miscarriage, maternity leave of at least two $ % weeks before and four $1% weeks after the delivery,miscarriage or abortion, with full pay based on her regular or average weekly wages.

SECTION ' =ccreditation of leave credits. 2here the pregnant woman employee fails to avail of the two'week pre'deliveryleave, or any portion thereof, the same shall be added to her post'delivery leave with pay.

SECTION ( >ayment of extended maternity leave. 2hen so re"uested by the woman employee, the extension of her maternityleave beyond the four'week post'delivery leave shall be paid by the employer from her unused vacation and(or sick leave credits,if any, or allowed without pay in the absence of such leave credits, where the extended leave is due to illness medically certified toarise out of her pregnancy, delivery, complete abortion or miscarriage which renders her unfit for work.

SECTION 1) ;imitation on leave benefits. The maternity benefits provided herein shall be paid by an employer only for the firstfour $1% deliveries, miscarriages, and(or complete abortions of the employee from *arch + , +FC , regardless of the number ofemployees and deliveries, complete abortions or miscarriages the woman employee had before said date. Bor purposes ofdetermining the entitlement of a woman employee to the maternity leave benefits as delimited herein, the total number of herdeliveries, complete abortions, or miscarriages after said date shall be considered regardless of the identity or number of employersshe has had at the time of such determination, provided that she en/oyed the minimum benefits therefor as provided in theseregulations.

SECTION 11 Bamily planning services. !mployers who habitually employ more than two hundred $ 33% workers in any localityshall provide free family'planning services to their employees and their spouses which shall include but not limited to, theapplication or use of contraceptives.

Sub/ect to the approval of the Secretary of ;abor and !mployment, the :ureau of 2omen and Doung 2orkers shall, within thirty$ 3% days from the effective date of these Rules, prescribe the minimum re"uirements of family planning services to be given byemployers to their employees.

SECTION 1! Relation to agreements. &othing herein shall prevent the employer and his employees or their representativesfrom entering into any agreement with terms more favorable to the employees than those provided herein, or be used to diminishany benefit granted to the employees under existing laws, agreements, and voluntary employer practices.

SECTION 1" >rohibited acts. 9t shall be unlawful for any employer#

$a% To discharge any woman employed by him for the purpose of preventing such woman from en/oying the maternity leave,facilities and other benefits provided under the ode)

$b% To discharge such woman employee on account of her pregnancy, or while on leave or in confinement due to her pregnancy)

$c% To discharge or refuse the admission of such woman upon returning to her work for fear that she may be pregnant)

$d% To discharge any woman or child or any other employee for having filed a complaint or having testified or being about to testifyunder the ode) and


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$e% To re"uire as a condition for a continuation of employment that a woman employee shall not get married or to stipulateexpressly or tacitly that upon getting married, a woman employee shall be deemed resigned or separated, or to actually dismiss,discharge, discriminate or otherwise pre/udice a woman employee merely by reason of her marriage.

SECTION 1# Bacilities for woman employees. Sub/ect to the approval of the Secretary of ;abor and !mployment, the :ureau of2omen and Doung 2orkers shall, within thirty $ 3% days from the effective date of these Rules, determine in an appropriateissuance the work situations for which the facilities enumerated in =rticle + + of the ode shall be provided, as well as theappropriate minimum age and other standards for retirement or termination of employment in special occupations in whichwomen are employed.


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RULE 6IIIEmployment of House0elpers

SECTION 1 General statement on coverage. $a% The provisions of this Rule shall apply to all househelpers whether employed onfull or part'time basis.

$b% The term 6househelper6 as used herein is synonymous to the term 6domestic servant6 and shall refer to any person, whether

male or female, who renders services in and about the employer5s home and which services are usually necessary or desirable forthe maintenance and en/oyment thereof, and ministers exclusively to the personal comfort and en/oyment of the employer5s family.

SECTION ! *ethod of payment not determinant. The provisions of this Rule shall apply irrespective of the method of paymentof wages agreed upon by the employer and househelper, whether it be hourly, daily, weekly, or monthly, or by piece or outputbasis.

SECTION " hildren of househelpers. The children and relatives of a househelper who live under the employer5s roof and whoshare the accommodations provided for the househelpers by the employer shall not be deemed as househelpers if they are nototherwise engaged as such and are not re"uired to perform any substantial household work.

SECTION # !mployment contract. The initial contract for household service shall not last for more than two $ % years. ?3.33% a month for those employed in the cities of *anila, Hue0on, >asay and aloocan, and in the municipalitiesof *akati, San Euan, *andaluyong, *untinlupa, &avotas, *alabon, >araIa"ue, ;as >iIas, >asig and *arikina, in the >rovince ofRi0al.

$b% Borty'five pesos $>[email protected]% a month for those employed in other chartered cities and first class municipalities) and

$c% Thirty pesos $> 3.33% a month for those in other municipalities.

SECTION % !"uivalent daily rate. The e"uivalent minimum daily wage rate of househelpers shall be determined by dividingthe applicable minimum monthly rate by thirty $ 3% days.

SECTION & >ayment by results. 2here the method of payment of wages agreed upon by the employer and the househelper isby piece or output basis, the piece or output rates shall be such as will assure the househelper of the minimum monthly or thee"uivalent daily rate as provided in this issuance.

SECTION ' *inimum cash wage. The minimum wage rates prescribed under this Rule shall be basic cash wages which shall bepaid to the househelpers in addition to lodging, food and medical attendance.

SECTION ( Time and manner of payment. 2ages shall be paid directly to the househelper to whom they are due at least once amonth. &o deductions therefrom shall be made by the employer unless authori0ed by the househelper himself or by existinglaws.S! T9-& +3. =ssignment to non'household work. &o househelper shall be assigned to work in a commercial, in

omnibus rules implementing the labor code - book 3

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