Additional Leave Benefits for Employees in the Private Sectors Act

Senate Office of the Seactarp NOV 27 P4:39 TWENTIETH CONGRESS OF THE ) First Regular Session RECEIVED BY: SENATE 1560 S. No. - Introduced by Senator Manuel "Lito" M. Lapid AN ACT AMENDING ARTICLE 95 OF PRESIDENTIAL DECREE NO. 442 OF 1974 OR THE LABOR CODE OF THE PHILIPPINES, TO PROVIDE ADDITIONAL LEAVE BENEFITS SUCH AS SICK LEAVE, VACATION LEAVE AND EMERGENCY LEAVE TO THE EMPLOYEES OF PRIVATE SECTOR, OTHERWISE KNOWN AS THE ADDITIONAL LEAVE BENEFITS FOR EMPLOYEES IN THE PRIVATE SECTOR ACT EXPLANATORY NOTE The labor force is one of the most important social and economic forces that moves the country forward and helps it grow. For a country to grow, it needs a healthy, motivated, and productive workforce. To do this, the government needs to keep policies in place that protect workers' health and well-being, encourage a balance between work and life, and boost the mental health and morale of Filipino workers. This bill wants to change Article 95 of the Labor Code of the Philippines to give employees in the private sector more mandatory leave benefits. Employees can only take five days off for Service Incentive Leave under the law as it stands. This proposed law would add specific and different leave benefits to better meet the needs of workers. This bill proposes the following: 1. Vacation Leave: Every employee who has worked for at least a year is entitled to five days of paid vacation leave each year. This leave is for personal reasons,

and the employee must file it at least three days in advance. Twenty days is the most vacation leave that can be used in a row. 2. Sick Leave: Every employee who has worked for the company for at least a year is entitled to five days of paid sick leave each year. If the employee or anyone in their immediate family gets sick, they can use this leave. 3. Emergency/Calamity Leave: Employees can take three days of paid emergency/calamity leave each year for things that come up unexpectedly. This leave is not the same as vacation or sick leave, and the employee cannot combine it with those types of leave or turn it into cash. The bill also proposes that the employee monetize in their vacation time and sets rules for cashing in sick time. It also makes sure that all unused vacation and sick leave credits can be turned into cash when someone leaves the company, retires, or dies. This bill seeks to afford private sector employees the opportunity to take the necessary time off to rest, recover, and deal with personal emergencies. This will make the workforce more balanced, safe, and productive. The labor force is a primary social economic force that drives the country's progress and development. For a country to grow, it needs a healthy, motivated, and productive workforce. To achieve this, the State must uphold policies that safeguard the health and well-being of workers, promote work-life balance, and improve the mental health and morale of Filipino workers. In view of the foregoing, the passage of this bill is earnestly sought. MANUEL "LITO" M. LAPID Senator

Senate Office of the Secretary TWENTIETH CONGRESS OF THE ) REPUBLIC OF THE PHILIPPINES First Regular Session NOV 27 P4:39 SENATE 1560 RECEIVED BY: S. No. p. Introduced by Senator Manuel "Lito" M. Lapid AN ACT AMENDING ARTICLE 95 OF PRESIDENTIAL DECREE NO. 442 OF 1974 OR THE LABOR CODE OF THE PHILIPPINES, TO PROVIDE ADDITIONAL LEAVE BENEFITS SUCH AS SICK LEAVE, VACATION LEAVE AND EMERGENCY LEAVE TO THE EMPLOYEES OF PRIVATE SECTOR, OTHERWISE KNOWN AS THE ADDITIONAL LEAVE BENEFITS FOR EMPLOYEES IN THE PRIVATE SECTOR ACT Be it enacted by the Senate and the House of Representatives of the Philippines in Congress assembled:

SECTION 1. Short Title. - This Act shall be known as the "Additional Leave

2 Benefits for Employees in the Private Sector Act".

SECTION 2. Declaration of Policy. - The State affirms labor as a primary social

4 economic force. To this end, the State shall uphold policies that support a healthy, motivated, and productive workforce. It shall safeguard the health of workers, 6 promote work-life balance, and improve the mental health and morale of Filipino workers.

SECTION 3. Definition of Terms. - As used in this Act, unless the context

otherwise requires, the following terms shall mean: (a) Monetization refers to payment in advance under certain limits and subject to specified terms and conditions of the money value of leave credits of an employee upon his request without actually going on leave;

(b) Sick Leave refers to leave of absence granted only on account of sickness or disability on the part of the employee concerned or any member of the employee's immediate family; (c) Vacation Leave refers to leave of absence granted to employees for personal reasons, the approval of which of contingent upon the exigencies of the service.

SECTION 4. Mandatory Emergency/Calamity Leave, Vacation Leave, and Sick

Leave. - Chapter III of Presidential Decree No. 442, as amended, is hereby further amended by renumbering the pertinent provisions and inserting additional section, to read as follows: "Chapter III - Holidays, [Service Incentive Leaves] EMERGENCY/CALAMITY LEAVE, SICK LEAVES, VACATION LEAVES, and Service Charges ART. 94. Right to Holiday Pay. - XXX ART 95. Right to [Service Incentive Leave] EMERGENCY/CALAMITY LEAVE, SICK LEAVES, AND VACATION LEAVES. - [(a) 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. (b) This provision shall not apply to those who are already enjoying the benefit herein provided, those enjoying vacation leave with pay of at least give 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.

(c) The grant of benefit in excess of that provided herein shall not be made a subject of arbitration or any court or administrative action.] EVERY EMPLOYEE WHO HAS RENDERED AT LEAST ONE YEAR OF SERVICE SHALL BE ENTITLED TO THE FOLLOWING LEAVE BENEFITS WITH PAY: (A) VACATION LEAVE. - EACH EMPLOYEE SHALL BE ENTITLED TO ONE (1) DAY OF VACATION LEAVE FOR EVERY FIFTY-TWO (52) DAYS OF ACTUAL SERVICE, EQUIVALENT TO FIVE (5) DAYS OF LEAVE PER YEAR. PROVIDED THAT, VACATION LEAVE MUST BE FILED BY AN EMPLOYEE AT LEAST THREE (3) DAYS BEFORE THE INTENDED LEAVE. THE CONTINUOUS USAGE OF THE ACCUMULATED VACATION LEAVE MUST BE UP TO TWENTY (20) DAYS ONLY. TARDINESS AND UNDERTIME OF THE EMPLOYEE SHALL BE CHARGED AGAINST VACATION LEAVE CREDITS; PROVIDED, THAT IF THE UNDERTIME IS DUE TO HEALTH REASONS AND SUPPORTED BY A MEDICAL CERTIFICATE, IT SHALL BE INSTEAD CHARGED AGAINST SICK LEAVE. (B) SICK LEAVE. - EACH EMPLOYEE SHALL BE ENTITLED TO ONE (1) DAY OF SICK LEAVE FOR EVERY FIFTY-TWO (52) DAYS OF ACTUAL SERVICE, EQUIVALENT TO FIVE (5) DAYS OF LEAVE PER YEAR. PROVIDED THAT, EMPLOYEES MAY USE SICK LEAVE IN THE EVENT OF AN ILLNESS. A LEAVE APPLICATION AND A MEDICAL CERTIFICATE, IF REQUIRED BY COMPANY POLICY, MUST BE SUBMITTED TO THE IMMEDIATE SUPERIOR UPON RETURNING TO WORK. (C) EMEGENCY/CALAMITY LEAVE. - AN EMPLOYEE SHALL BE ENTITLED TO THREE (3) DAYS OF EMERGENCY/CALAMITY LEAVE

ANNUALLY. THESE DAYS SHALL EXPIRE UPON THE LAST DAY OF EACH YEAR, AND SHALL NOT BE CUMULATIVE NOR CONVERTIBLE TO CASH. THIS LEAVE IS INTENDED FOR UNFORESEEN CIRCUMSTANCES. THE ENTITLEMENT TO EMERGENCY/CALAMITY LEAVE SHALL BE SEPARATE AND DISTINCT FROM VACATION LEAVE AND SICK LEAVE CREDITS. PROVIDED THAT, THE GRANT OF BENEFIT IN EXCESS OF THAT PROVIDED IN THIS SECTION SHALL NOT BE MADE A SUBJECT OF ARBITRATION OR ANY COURT OR ADMINISTRATIVE ACTION. ART. 95-B - MONETIZATION - (A) MONETIZATION OF ACCUMULATED VACATION LEAVE SHALL BE ALLOWED FOR ACTIVE EMPLOYEES. THE EMPLOYEE SHALL HAVE AT LEAST TEN (10) ACCUMULATED VACATION LEAVE CREDITS. REQUESTS FOR MONETIZATION MAY BE SUBMITTED AT ANY TIME PRIOR TO SEPARATION OR RETIREMENT. A MINIMUM OF AT LEAST TEN (10) DAYS, AND A MAXIMUM OF TWENTY (20) DAYS MAY BE MONETIZED BY THE EMPLOYEE IN A GIVEN YEAR. THE EMPLOYEE SHALL RETAIN A MINIMUM OF FIVE (5) DAYS OF VACATION LEAVE FOLLOWING THE MONETIZATION. (B) MONETIZATION OF SICK LEAVE IS PROHIBITED UNLESS THE PURPOSE THEREOF IS FOR HOSPITALIZATION OR THE MEDICAL NEEDS OF THE EMPLOYEE OR HIS/HER IMMEDIATE FAMILY. A PROOF OF HOSPITALIZATION OR FOR MEDICAL NEEDS SHALL BE PROVIDED BY THE EMPLOYEE. THE SAME REQUIREMENT ON THE RETAINED NUMBER OF LEAVES AS REQUIRED IN THE PRECEDING PARAGRAPH SHALL BE COMPLIED BY THE EMPLOYEE.

(C) MONETIZED LEAVE CREDITS SHALL BE TREATED AS PART OF COMPENSATION AND SUBJECT TO EXISTING LAWS ON TAXATION, EXCEPT AS OTHERWISE EXEMPTED BY LAW. (D) ALL UNUSED VACATION AND SICK LEAVE CREDITS SHALL BE COMMUTABLE TO THEIR CASH EQUIVALENT UPON SEPARATION, RETIREMENT, OR DEATH, AND PAYABLE TO THE EMPLOYEE OR HIS/HER HEIRS. XXX"

SECTION 5. Non-Diminution Clause. - Nothing in this Act shall be construed

10 to reduce or substitute existing leave benefits under company policy, collective 11 bargaining agreements, or other laws that grant greater benefits.

SECTION 6. Implementing Rules and Regulations. - Within sixty (60) days

from the approval of this Act, the Department of Labor and Employment (DOLE), in consultation with employer groups, labor unions, and relevant stakeholders, shall promulgate the rules and regulations implementing the provisions of this Act.

SECTION 7. Separability Clause. - If any provision of this Act or the application

17 of such provision is declared unconstitutional, the remainder thereof not otherwise 18 affected shall remain in full force and effect.

SECTION 8. Repealing Clause. - All laws, presidential decrees, executive

orders, letters of instruction, proclamations or administrative regulations that are inconsistent with the provisions of this Act are hereby repealed, modified, or amended accordingly.

SECTION 9. Effectivity. - This Act shall take effect fifteen (15) days after its

complete publication either in the Official Gazette or in a newspaper of general circulation. Approved,