PHILIPPINES: Annual Alert – Expected Labour Law Changes in 2017

Labour standards

The Department of Labor and Employment (DOLE) has made changes to the Labor Laws Compliance System (LLCS), which are now in effect:  LLCS is a framework of rules created to protect employees by ensuring compliance with the General Labor Standards, Occupational Safety and Health Standards and other related labor laws. Employers are assessed by compliance officers who conduct a series of evaluations.

The revised rules introduce a fourth method of compliance evaluation, which is the Special Assessment of Visit of Establishment. The other types of compliance evaluation continue to be the Joint Assessment, the Compliance Visit, and the Occupational Safety and Health Standards Investigation.

Action required:

(1) Understand the new form of evaluation and prepare for onsite inspections and labour standards evaluations.

(2) Be aware that in recent months, DOLE has been actively conducting visits and site inspections to monitor employers’ compliance with labour laws.

Labour sub-contracting

DOLE has stopped the registration of new contractors and sub-contractors.  In an effort to curb the illegal sub-contracting of labour (called “Endo” locally) DOLE has stopped the registration of new contractors and sub-contractors. Endo is a practice of businesses repeatedly hiring the same workers from contractors on back to back short term contracts. This is done to prevent them acquiring employment benefits and protection from employment laws (typically protection does not start until the employee has above 6 months’ service).

Labour Secretary, Silvestre Bello, confirmed that pre-existing registrations and contractor agreements will continue to be respected, but it is likely they could be reviewed in the near future.

Action required:  None at the moment, but keep abreast of legal developments in this area.