Labor Laws in the Philippines You Should Know

If you’re thinking of outsourcing some work to the Philippines, it’s important to be familiar with the country’s labor laws. While most are similar to those in other countries, there are a few that are unique to the Philippines. Here are 10 of the most important ones.

#1 Equal Work Opportunities for All

The Department of Labor and Employment’s law covers issues such as labor protection, equal work opportunity promotion, and regulating employment relationships. According to the law, employers must not discriminate against race, gender or creed when it comes to hiring someone or paying them. As a responsible employer, you should make sure that you are not breaking this law by denying somebody work or paying them less because of prejudice.

#2 Security of Tenure

The Philippines law is clear on employee rights to job security. You cannot dismiss them for unjust or unauthorized causes, and due process must be followed. This includes an extensive investigation of any supposed incidents.

Just cause refers to any wrongdoing an employee may commit, while authorised cause relates to grounds like redundancy or retrenchment that are reasonable bases for termination. In other words, you cannot terminate employees without justifiable reason.

#3 Weekly Rest Day

As an employer, you are required to give your employees at least 24 hours of uninterrupted rest after every six consecutive working days. However, the law does not explicitly state that a rest day should be on the weekend.

#4 Wage and Wage-Related Benefits

Your employees are legally entitled to reasonable compensation for their work. This compensation, called a wage, is usually fixed for an agreed period. In some cases, the minimum wage may be different based on the type of industry or region where your employee works. If you don’t pay your workers fairly, you’re breaking the law

#5 Safe Working Conditions

By law, every employer is responsible for protecting employees from worksite dangers like fires, health hazards, and accidents. This includes installing safety devices such as fire exits and extinguishers, proper ventilation systems, and maintaining a clean environment. In the Philippines, every new establishment must comply with the city’s safety code to be granted a permit to operate.

#6 Rights to Self-Organization and Collective Bargaining

Collective bargaining is the process of negotiating terms about a particular issue between employers and employees. All workers have the right to self-organize and join unions to take part in collective bargaining from the first day of employment.

#7 13th-Month Pay

Mandated by law, the 13th-month pay is a monetary bonus that any private employee with a fixed or guaranteed salary who has rendered work for at least one month will receive. The payout is given either in two installments or in total on or before December 24th.

#8 Overtime Pay

If an employee works more than 8 hours in a day, they are entitled to overtime pay. This additional compensation is at least 25% of their regular hourly wage.

#9 Premium Pay

Employees who work on official holidays or rest days are entitled to premium overtime pay. They will receive their regular wage, plus at least an additional 30%.

#10 Night Shift Differential

Night differential applies to employees who render work between 10 PM and 6 AM. Additional compensation of 10% based on their regular hourly rate is applied for every hour rendered.

Complying with labor laws is not only the right thing to do, but it’s also good for business. A happy and healthy workforce is a productive one, and by following these practices, you can ensure that your employees are protected while keeping your business running smoothly.

Navigating the complex labor laws in the Philippines can be a daunting task for businesses. But with the help of outsourcing, it doesn’t have to be. By outsourcing to a reputable and experienced staffing provider like hammerjack, you can trust that your needs will be taken care of and that you’ll be in compliance with all relevant labor regulations.

Of course, even with the best intentions, navigating employment law can be tricky. If you need help building or managing your offshore team, our experienced staff at hammerjack is here to help. With our experience in HR and recruitment in the Philippines, we can take the hassle out of finding top talent so you can focus on what you do best: running your business.