PHILIPPINES: An Introduction to Employment
New Legislative Developments to Protect Employees
In 2024, the landscape of Philippine employment law has seen a renewed focus on the improvement of labour standards for Overseas Filipino Workers (OFW), those working in the movie and television industry, and probationary employees, among others. This shift reflects a broader effort to address the needs and rights of various labour sectors.
Magna Carta for Filipino Seafarers
The weak enforcement of labour law standards in the Philippines, coupled with comparatively low wages, has driven many Filipinos to seek better livelihood opportunities abroad. This has become a significant motivator for many to pursue employment opportunities outside the country. According to the Philippines’ Department of Migrant Workers, the country has consistently deployed no less than 400,000 sea-based OFWs per year since 2014, excluding the years 2020–2022. Further, based on government reports, OFW remittances represented 8.5% and 7.7% of the country’s GDP and gross national income (GNI), respectively. Given these economic conditions, the Philippine legislature has regularly sought to improve the situation of OFWs, particularly Filipino seafarers, who make a significant contribution to the Philippine economy.
In the past year, the Philippine Congress passed the Magna Carta of Filipino Seafarers. This law now requires covered ocean-going ships to have fair, effective and expeditious onboard and onshore grievance mechanisms readily accessible, at no cost to the seafarer.
Further, the new Magna Carta of Filipino Seafarers provides clarity and balance with respect to the execution of monetary awards, by requiring seafarers to first post a bond before they can execute on any award of damages. The posting of the bond is intended to assure the employer that, even if the seafarer executes on the award of damages in their favour, the full restitution of those amounts is assured in case the award is reversed by a higher tribunal. But if the seafarer ultimately prevails, then the employer must immediately reimburse the total amount paid by the seafarer for the cost of the bond. This provision is unique considering that no such obligation was placed upon the worker, in this case the seafarer, under the Philippine Labour Code.
Eddie Garcia Law and workers in the movie and TV industry
The continued strengthening of labour standards was also shown by the enactment of the Eddie Garcia Law. The law takes into account the circumstances concerning the untimely passing of veteran Filipino actor Eddie Garcia, who died after taking a fall on set. Many believe this could have been avoided by diligent compliance with occupational safety standards by those involved in the movie and television industry.
To ensure that workers in the entertainment industry will be duly protected, the Eddie Garcia Law has created the Movie and Television Industry Tripartite Council. This council is mandated to come up with the appropriate safety standards applicable to the industry, upon consultation with all the relevant stakeholders. The law also reinforces the intellectual property rights of the industry’s workers, particularly with respect to their performances.
Employees cannot be dismissed due to HIV diagnosis
In a significant development in Philippine jurisprudence, the Supreme Court recently held that it is illegal to dismiss an employee just because the person has tested positive for human immunodeficiency virus (HIV).
In the case of Bison Management Corporation v AAA, GR No 256540, 20 May 2024, an OFW deployed in Saudi Arabia was dismissed and repatriated to the Philippines after the employer learned that the OFW had tested positive for HIV. However, the Supreme Court invalidated the dismissal and held that the Philippine HIV and AIDS Policy Act makes it unlawful to terminate employees based solely on a positive HIV test result. This case is significant as it confirms that a positive HIV test result is not the same as having a “disease” that would warrant the employee’s dismissal under the Labour Code.
Back wages due to illegally dismissed probationary employees
Probationary employees who are illegally dismissed have also gained stronger protections for their rights. In the recent case of CP Reyes Hospital v Barbosa, GR No 228357, 16 April 2024, the Supreme Court en banc ruled that probationary employees who are illegally dismissed are entitled to back wages covering not only the remaining duration of their probationary period, but also the period during which their compensation was withheld, up until their reinstatement.
This case effectively abandons the doctrine laid down in Robinsons Galleria/Robinsons Supermarket Corporation v Ranchez, GR No 177937, 19 January 2011, which held that the back wages of illegally terminated probationary employees should only be computed up to the end of their probationary period. This decision was reached because, upon the lapse of the probationary employment, the employer-employee relationship between the parties had been severed.
Under the new case law of CP Reyes Hospital v Barbosa, the Supreme Court en banc now holds that the mere lapse of probationary employment without regularisation does not, and should not, by itself, sever the employment relationship.The change in status, from probationary to regular, happens ipso facto, or by force and operation of law, without any further act or deed on the part of the employer and the employee. To truly sever the employer-employee relationship, therefore, it must be shown that the lapse of the probationary period is coupled with either valid dismissal of the employee for just or authorised causes, or with the employee’s failure to qualify for regularisation.