Labor Standards P.D.

442 of 1974, as amended and renumbered – refers to that part of the labor law
which prescribes the minimum terms and conditions of employment which the employer is
required to grant to its employees

Coverage – ALL employees in ALL establishments. Excluded;

- Govt employees (covered by civil service law)

It is a condition sine qua non for the application of labor laws that there is an employer-employee
relationship. Fourfold test –

1. The selection and engagement of the employees

1) Basic pay – all the renumeration or earnings paid by an employer to a worker for
services rendered on normal working days and hours but does not include cost of
living allowances, profit sharing payments, premium payments, 13th month pay or
other monetary benefits which are not considered as part of or integrated into the
regular salary of the workers
The following are excluded from the computation of basic salary: payment for sick,
vacation and maternity leaves, night differentials, regular holiday pay and
premiums for work done on rest days and special holidays
2) Overtime premium – service in rendered in excess of and in addition to 8 hours on
ordinary working days, which are prescribed daily work period
Overtime pay –

General rule: No employee may be compelled to render overtime work against his
will
Exception: can be compelled to rendered to overtime work. Refusal: dismissal on
the grounds of insubordination or willful disobedience
1. Country is at war
2. Overtime is necessary to prevent loss of life or property
3. Urgent work is to be performed on machines in order to avoid serious loss
4. Necessary to prevent loss to perishable goods, and etc.
3) Night shift differential – every employee shall be paid a night shift differential of not
less than 10% of his regular wage for each hour worked performed between 10 pm
to 6am.

4) Holiday premium – every worker shall be paid his regular daily wage during
holidays except in retail and service establishments regularly employing less than
10 employees
Holiday pay is a one day pay given by law to an employee even if he does not work
on a regular holiday. This gift of a day’s pay is limited to each of the 12 regular
holidays. It is not demandable for any kind of nonworking day.
200% of daily wage – regular holiday
5) 13th month pay – only rank and file employees in the private sector regardless of
their position, designation or employment status and irrespective of the method by
which their wages are paid are entitled to 13th month pay provided that they have
worked for at least 1 month during the calendar year. Managerial employees are
excluded. Excluded: govt employees, employers already paying their employees
 13th month, employees who are paid on purely commission, boundary or task basis
and those who are paid a fixed amount for performing a specific work
Paid not later than December 24th
Not less than 1/12 of the total basic salary earned by an employee within a
calendar year
6) Leaves – only service incentive leaves
7) Service incentive leave – employee who has rendered at least 1 year of service is
entitled to a yearly service incentive leave of 5 days
Unavailed service leave = commutable to cash
8) Maternity leave RA 11210 – all covered females regardless of civil status, 105 days
regardless of mode of delivery
Plus additional 15 days for female solo parent
Option to extend for an additional 30 days without pay
Available for every instance of live childbirth
60 days – for miscarriage and emergency termination of pregnancy
female entitled to maternity leave may allocate up to seven days of benefit to
child’s father or alternate caregiver
9) Paternity leave – legally married male – 7 days leave (first four deliveries of
legitimate spouse with whom he is cohabiting) not convertible to cash
10) Parental leave for solo parent RA 8972– male or female solo parent – additional 7
days every year, rendered 1 year of service
1. Concept

Labor standards refer to legally-mandated benefits required to be given to the employees by the
employer or, in some cases, by the Government. Labor standards are also known as “General Labor
Standards” or “Legally-Mandated Benefits.”

a. List of Labor Standards

Currently, these are the labor standards:

1) Minimum Wage
2) Holiday pay
3) Premium pay
4) Overtime pay
5) Night shift differential
6) Service charges
7) Service incentive leave
8) Maternity leave
9) Paternity leave
10) Parental leave
11) Leave for VAWC
12) Special leave for women
13) 13th month pay
14) Separation pay
15) Retirement pay
16) ECC benefits*
 17) PhilHealth benefits*
18) SSS benefits*
19) Pag-IBIG benefits*

In the Philippines, many laws govern employment practices. What can be considered as the
backbone, however, is the Presidential Decree No. 442 also known as the Labor Code of the
Philippines. It was enacted in 1974 and has long undergone various changes to accommodate the
evolving landscape of employment.

The Labor Code of the Philippines is a legal code that establishes labor practices and employment
standards within the country. It details the provisions for the recruitment and placement of workers,
working conditions, benefits, and penalties for unmet labor requirements.

Below are some of the key provisions in the Labor Code:

Recruitment and Placement

Only Filipino citizens OR corporations, partnerships, or entities where Filipino citizens own and
control at least 75% of the authorized and voting capital stock are allowed to partake in recruitment
and placement activities locally or abroad.

If an organization wishes to bring in foreign workers, they must first obtain an employment permit
from the Department of Labor and Employment (DOLE).

Conditions of Employment

The conditions of employment cover many aspects of being employed in the country. Below are
some of the key provisions:

Working Hours: Employees typically work 8 hours per day, 5 days per week. Clinical personnel may
be required to work 6 hours per week or 48 hours per week under certain conditions. In such cases,
they must be compensated accordingly. Likewise, an employee may work beyond 8 hours daily
provided that they are paid at an overtime rate.

Meal Periods: Employers have to provide employees with at least 60 minutes of meal period (non-
compensable).

Rest Periods: Employers are required to give their employees at least 24 consecutive hours of rest
after 6 consecutive working days.

Paid Holidays: The country recognizes several regular and special holidays where the employees
need not report for work but still receive their regular daily pay.

Wage/Salary: Philippine labor laws require employers to pay employees at least the minimum
wage. Currently, for non-agricultural industry, it’s 610 PHP daily in Metro Manila. Other regions have
different minimum wages. Note that working overtime, on the established rest day, and on
approved paid holidays, warrant just compensation as dictated by the law (usually at a higher rate).
Service Incentive Leaves: An employee who has rendered a year of service in the company should
receive at least 5 days paid incentive leaves.

Maternity Leave: In the past, pregnant employees who have rendered at least 6 months of service
in the past 12 months shall be granted at least 2 weeks of paid maternity leave before giving birth
and another 4 weeks after. The government has passed a separate law in 2019, extending the paid
maternity leave to 105 days.

13th Month Pay: The employer is required by the Philippine employment laws to pay 13th month
pay equivalent to 1 month of the employee’s salary (provided they have worked the full year). This
must be paid on or before the 24th of December.

Health and Safety

Employment laws in the Philippines, particularly the Labor Code, outline the provisions to ensure
employee health and safety. The employer must ensure that their employees have access to
emergency medical and dental services and that their working conditions adhere to the health and
safety standards.

The Labor Code also ensures that employees promptly receive benefits in work-related disability or
death.

Termination of Employment

A regular employee has security of tenure, which means he or she cannot be terminated without
just cause. Under the employment laws, an employer can only terminate an employee for:
 • Fraud or deliberate violation of trust by the employee towards the employer or the
employer's authorized representative
• Gross or habitual neglect of duties
• Serious misconduct or intentional defiance by the employee of the employer's legal
instructions related to work
• Committing a crime or offence against the employer, their immediate family, or authorised
representatives

In the case of retirement, the employee is entitled to receive his benefits he earned under the
existing legislation. If there’s no retirement plan, the employee, upon reaching the age of 60 (or 65,
which is the compulsory retirement age), shall receive ½ of their monthly salary per year of service
provided that they have stayed in the company for at least 5 years. Note that a fraction of at least 6
months is considered 1 year of service.

BOOK THREE
CONDITIONS OF EMPLOYMENT

Title I
WORKING CONDITIONS AND REST PERIODS

Chapter I
HOURS OF WORK

Article 82. Coverage. The provisions of this Title shall apply to employees in all establishments and
undertakings whether for profit or not, but not to government employees, managerial employees,
field personnel, members of the family of the employer who are dependent on him for support,
domestic helpers, persons in the personal service of another, and workers who are paid by results
as determined by the Secretary of Labor in appropriate regulations.

As used herein, "managerial employees" refer to those whose primary duty consists of the
management of the establishment in which they are employed or of a department or subdivision
thereof, and to other officers or members of the managerial staff.

"Field personnel" shall refer to non-agricultural employees who regularly perform their duties away
from the principal place of business or branch office of the employer and whose actual hours of
work in the field cannot be determined with reasonable certainty.

Article 83. Normal hours of work. The normal hours of work of any employee shall not exceed eight
(8) hours a day.

Health personnel in cities and municipalities with a population of at least one million (1,000,000) or
in hospitals and clinics with a bed capacity of at least one hundred (100) shall hold regular office
hours for eight (8) hours a day, for five (5) days a week, exclusive of time for meals, except where the
exigencies of the service require that such personnel work for six (6) days or forty-eight (48) hours,
in which case, they shall be entitled to an additional compensation of at least thirty percent (30%)
of their regular wage for work on the sixth day. For purposes of this Article, "health personnel" shall
include resident physicians, nurses, nutritionists, dietitians, pharmacists, social workers,
laboratory technicians, paramedical technicians, psychologists, midwives, attendants and all other
hospital or clinic personnel.

Article 84. Hours worked. Hours worked shall include (a) all time during which an employee is
required to be on duty or to be at a prescribed workplace; and (b) all time during which an employee
is suffered or permitted to work.

Rest periods of short duration during working hours shall be counted as hours worked.

Article 85. Meal periods. Subject to such regulations as the Secretary of Labor may prescribe, it
shall be the duty of every employer to give his employees not less than sixty (60) minutes time-off
for their regular meals.

Article 86. Night shift differential. Every employee shall be paid a night shift differential of not less
than ten percent (10%) of his regular wage for each hour of work performed between ten o’clock in
the evening and six o’clock in the morning.

Article 87. Overtime work. Work may be performed beyond eight (8) hours a day provided that the
employee is paid for the overtime work, an additional compensation equivalent to his regular wage
plus at least twenty-five percent (25%) thereof. Work performed beyond eight hours on a holiday or
rest day shall be paid an additional compensation equivalent to the rate of the first eight hours on a
holiday or rest day plus at least thirty percent (30%) thereof.

Article 88. Undertime not offset by overtime. Undertime work on any particular day shall not be
offset by overtime work on any other day. Permission given to the employee to go on leave on some
other day of the week shall not exempt the employer from paying the additional compensation
required in this Chapter.

Article 89. Emergency overtime work. Any employee may be required by the employer to perform
overtime work in any of the following cases:

When the country is at war or when any other national or local emergency has been declared by the
National Assembly or the Chief Executive;

When it is necessary to prevent loss of life or property or in case of imminent danger to public safety
due to an actual or impending emergency in the locality caused by serious accidents, fire, flood,
typhoon, earthquake, epidemic, or other disaster or calamity;

When there is urgent work to be performed on machines, installations, or equipment, in order to

When the work is necessary to prevent loss or damage to perishable goods; and

Where the completion or continuation of the work started before the eighth hour is necessary to
prevent serious obstruction or prejudice to the business or operations of the employer.

Any employee required to render overtime work under this Article shall be paid the additional
compensation required in this Chapter.
Article 90. Computation of additional compensation. For purposes of computing overtime and
other additional remuneration as required by this Chapter, the "regular wage" of an employee shall
include the cash wage only, without deduction on account of facilities provided by the employer.

Chapter III
HOLIDAYS, SERVICE INCENTIVE LEAVES AND SERVICE CHARGES

Article 94. Right to holiday pay.

Every worker shall be paid his regular daily wage during regular holidays, except in retail and service
establishments regularly employing less than ten (10) workers;

The employer may require an employee to work on any holiday but such employee shall be paid a
compensation equivalent to twice his regular rate; and

As used in this Article, "holiday" includes: New Year’s Day, Maundy Thursday, Good Friday, the ninth
of April, the first of May, the twelfth of June, the fourth of July, the thirtieth of November, the twenty-
fifth and thirtieth of December and the day designated by law for holding a general election.

Article 95. Right to service incentive leave.

Every employee who has rendered at least one year of service shall be entitled to a yearly service
incentive leave of five days with pay.

This provision shall not apply to those who are already enjoying the benefit herein provided, those
enjoying vacation leave with pay of at least five days and those employed in establishments
regularly employing less than ten employees or in establishments exempted from granting this
benefit by the Secretary of Labor and Employment after considering the viability or financial
condition of such establishment.

The grant of benefit in excess of that provided herein shall not be made a subject of arbitration or
any court or administrative action.

Article 96. Service charges. All service charges collected by hotels, restaurants and similar
establishments shall be distributed at the rate of eighty-five percent (85%) for all covered
employees and fifteen percent (15%) for management. The share of the employees shall be equally
distributed among them. In case the service charge is abolished, the share of the covered
employees shall be considered integrated in their wages.

Article 133. Maternity leave benefits.

Every employer shall grant to any pregnant woman employee who has rendered an aggregate
service of at least six (6) months for the last twelve (12) months, maternity leave of at least two (2)
weeks prior to the expected date of delivery and another four (4) weeks after normal delivery or
abortion with full pay based on her regular or average weekly wages. The employer may require from
any woman employee applying for maternity leave the production of a medical certificate stating
that delivery will probably take place within two weeks.
The maternity leave shall be extended without pay on account of illness medically certified to arise
out of the pregnancy, delivery, abortion or miscarriage, which renders the woman unfit for work,
unless she has earned unused leave credits from which such extended leave may be charged.

The maternity leave provided in this Article shall be paid by the employer only for the first four (4)
deliveries by a woman employee after the effectivity of this Code.

SEC. 8. Parental Leave. - In addition to leave privileges under existing laws, parental leave of
not more than seven (7) working days every year shall be granted to any solo parent employee
who has rendered service of at least one (1) year.

Solo Parent Leave

Solo parent leave benefits are leave credits extended to covered employees who are solo
parents, and who may want to use them whenever they take a leave from work to perform
parental duties, so that they remain paid during such absence from work. The benefit applies
to all solo parents. The benefit consists of seven (7) working days of leave credits with full pay.

1. Concept

Parental leave for solo parents or solo parent leave – refers to ‘leave benefits granted to a solo
parent to enable the performance of parental duties and responsibilities where physical
presence is required or beneficial to the child.’(R.A. 8972, as amended, Section 3[e])

a. Legal basis

1) R.A. 8972, As amended by R.A. 11861 Section 8

b. Solo parent

Solo parent – refers to ‘any individual who falls under any of the following categories:

(a) A parent who provides sole parental care and support of the child or children due to –

(1) Birth as a consequence of rape, even without final conviction: Provided, That the mother
has the sole parental care and support of the child or children: Provided, further, That the solo
parent under this category may still be considered a solo parent under any of the categories in
this section;

(2) Death of the spouse;

(3) Detention of the spouse for at least three (3) months or service of sentence for a criminal
conviction;

(4) Physical or mental incapacity of the spouse as certified by a public or private medical
practitioner;

(5) Legal separation or de facto separation for at least six (6) months, and the solo parent is
entrusted with the sole parental care and support of the child or children;
(6) Declaration of nullity or annulment of marriage, as decreed by a court recognized by law, or
due to divorce, subject to existing laws, and the solo parent is entrusted with the sole parental
care and support of the child or children; or

(7) Abandonment by the spouse for at least six (6) months;

(b) Spouse or any family member of an Overseas Filipino Worker (OFW), or the guardian of the
child or children of an OFW: Provided, That the said OFW belongs to the low/semi-skilled
worker category and is away from the Philippines for an uninterrupted period of twelve (12)
months: Provided, further, That the OFW, his or her spouse, family member, or guardian of the
child or children of an OFW falls under the requirements of this section;

(c) Unmarried mother or father who keeps and rears the child or children;

(d) Any legal guardian, adoptive or foster parent who solely provides parental care and support
to a child or children;

(e) Any relative within fourth (4th) civil degree of consanguinity or affinity of the parent or legal
guardian who assumes parental care and support of the child or children as a result of the
death, abandonment, disappearance or absence of the parents or solo parent for at least six
(6) months: Provided, That in cases of solo grandparents who are senior citizens but who have
the sole parental care and support over their grandchildren who are unmarried, or
unemployed and twenty-two (22) years old or below, or those twenty-two (22) years old or over
but who are unable to fully take care or protect themselves from abuse, neglect, cruelty,
exploitation, or discrimination because of a physical or mental disability or condition, they
shall be entitled to the benefits of this Act in addition to the benefits granted to them by
Republic Act No. 9257, otherwise known as the ‘Expanded Senior Citizens Act of 2003’; or

(f) A pregnant woman who provides sole parental care and support to the unborn child or
children.’ (R.A. 8972, as amended, Section 4)

More info: Solo Parent Employees

2. The benefit

The benefit consists of ‘a forfeitable and noncumulative parental leave of not more than seven
(7) working days with pay every year shall be granted to any solo parent employee.’ (R.A. 8972,
as amended, Section 8)

a. Computation

The leave credit is equal to the basic salary, including mandatory and/or integrated
allowances. The pay shall not be less than the minimum wage.

b. Usage

The benefit is designed to grant a solo parent to enable him/her to perform parental duties and
responsibilities where physical presence is required.