Workers Health and Wellness Act

Senalt Office of the Secretarp TWENTIETH CONGRESS OF THE ) REPUBLIC OF THE PHILIPPINES 26 MAR -4 P 3:40 First Regular Session SENATE 1928 S.B. No. RECEIVED BY: Introduced by SENATOR IMEE R. MARCOS AN ACT PROMOTING WORKERS' HEALTH AND WELLNESS, PROVIDING INCENTIVES TO EMPLOYERS FOR THE IMPLEMENTATION OF WORKFORCE WELLNESS AND WORKPLACE IMPROVEMENT PROGRAMS, AND APPROPRIATING FUNDS THEREFOR EXPLANATORY NOTE Workers are the backbone of the Philippine economy. Their physical health, mental well-being, and overall quality of life directly affect productivity, workplace morale, and national economic growth. In an evolving work environment marked by rapid technological change, new work arrangements, and increasing mental health challenges, there is a growing need for employers to actively support the holistic wellness of their workforce. Employees typically spend at least eight (8) hours a day in the workplace. As such, employers are uniquely positioned to influence the physical, emotional, and mental well-being of their workers through policies, programs, and workplace environments that promote healthier lifestyles and safer working conditions. Studies have shown that workplace wellness programs and improved working environments can significantly reduce health risks, lower absenteeism, improve employee engagement, and enhance productivity. However, many enterprises— particularly micro, small, and medium enterprises (MSMEs)-face financial constraints that prevent them from implementing comprehensive wellness programs or workplace improvements. Recognizing these challenges, it is the policy of the State to encourage and support employers who invest in the health and well-being of their workers. By providing targeted incentives, the government can encourage businesses to implement programs that promote healthier lifestyles, strengthen workplace environments, and improve overall employee welfare.

This proposed measure seeks to promote workers' health and wellness by granting incentives to employers that adopt Employee Wellness Programs and Workplace Improvement Programs. The Employee Wellness Programs include initiatives that empower workers to make healthier lifestyle choices through a combination of the following components: 1. Health Awareness - providing periodic health screenings and appropriate referrals for follow-up care; 2. Health Education - disseminating information that addresses employee-specific health risks and wellness needs; 3. Employee Engagement - involving employees in the planning, implementation, and evaluation of wellness initiatives; 4. Behavioral Change Programs - promoting healthy habits through programs addressing stress management, nutrition, physical fitness, and other lifestyle concerns; and 5. Supportive Worksite Policies - establishing workplace policies that encourage mental health awareness, flexible work arrangements, smoke-free environments, healthy food options, and opportunities for physical activity. Employers implementing qualified Employee Wellness Programs may be granted a tax credit of up to One Thousand Pesos (PhP1,000) per employee for employers with fewer than two hundred (200) employees, and up to Five Hundred Pesos (PhP500) per employee in excess of two hundred (200) employees, for a period of three (3) years from the certification of the program by the Department of Health (DOH). In addition, the bill incentivizes Workplace Improvement Programs, which include measures such as retrofitting office spaces to improve energy efficiency, installing or upgrading ventilation systems, and integrating smart building technologies or renewable energy systems. These improvements will not only promote healthier working environments, but also contribute to sustainable and energy-efficient workplaces. Employers implementing such improvements may avail of an additional thirty percent (30%) of the cost as deductible depreciation expense, with the option of accelerated depreciation for income tax purposes. The passage of this bill will support the initiatives promoted under Republic Act No. 11036, otherwise known as the "Mental Health Act', which mandates that employers "shall develop appropriate policies and programs on mental health in the workplace designed to raise awareness on mental health issues, correct stigma and discrimination associated with mental health condition, identify and provide support for individuals at risk, and facilitate access of individuals with mental health conditions to treatment and psychosocial support" and the "Smoke-Free" policy of the government. Further, this bill will complement the minimum public health standards of the government in workplaces under DOH Order No. 2020-0015.

If business enterprises can avail of incentives to bring down their tax liabilities, they will be encouraged to prioritize and focus on the wellness of their workers. The country can be assured of a healthier and happier workforce, as well as ensure better job satisfaction that will boost productivity and support our efforts on the road to economic recovery. In view of the foregoing, the approval of this bill is earnestly sought. Fice h. Marca AMEE R. MARCOS

sociate Office of the Beretarp TWENTIETH CONGRESS OF THE ) REPUBLIC OF THE PHILIPPINES MAR -4 P3:40 First Regular Session SENATE RECEIVED BY: 1928 S.B. No. _ Introduced by SENATOR IMEE R. MARCOS AN ACT PROMOTING WORKERS' HEALTH AND WELLNESS, PROVIDING INCENTIVES TO EMPLOYERS FOR THE IMPLEMENTATION OF WORKFORCE WELLNESS AND WORKPLACE IMPROVEMENT PROGRAMS, AND APPROPRIATING FUNDS THEREFOR Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

SECTION 1. Short Title. - This act shall be known as the " Workers Health and

2 Wellness Act."

SEC. 2. Declaration of Policy. - The State recognizes the vital role of workers in

national development and affirms its commitment to promote and protect their health, safety, and overall well-being. It shall be the policy of the State to encourage and support employers in adopting programs and initiatives that promote the physical, mental, and emotional wellness of their workforce, and to foster workplace 8 environments that are safe, healthy, and conducive to productivity. Towards this end, the State shall incentivize employers who implement workforce wellness programs and undertake workplace improvements that support healthier lifestyles, enhance working conditions, and strengthen employee welfare. The State likewise recognizes the importance of collaboration between government and the private sector in advancing workplace health initiatives that contribute to improved productivity, greater job satisfaction, and sustainable economic growth.

SEC. 3. Coverage. - This Act shall apply to all business enterprises and

2 employers, including Government-Owned and-Controlled corporations (GOCCs) performing proprietary functions.

SEC. 4. Employee Wellness Program Tax Credit. -

(1) The Employee Wellness Program credit for any taxable year during the credit period with respect to any employer is an amount equal to fifty percent (50%) of the costs paid or incurred by the employer in connection with a qualified wellness program during the taxable year. For purposes of the preceding sentence, in the case of any qualified Employee Wellness Program offered as part of an employer-provided group health plan, including health insurance offered in connection with such plan, only costs directly attributable to the qualified wellness program and not to the group health plan or health insurance coverage may be taken into account. (2) Limitation. - The amount of tax credit allowed under paragraph one (1) for any taxable year shall not exceed the sum of: (i) the product of One Thousand Pesos (PhP1,000.00) and the number of employees of the employer not in excess of Two Hundred (200) employees, and (ii) the product of Five Hundred Pesos (PhP 500.00) and the number of employees in excess of Two Hundred (200) employees.

SEC. 5. Qualified Employee Wellness Program. - The term "Qualified Employee

Wellness Program" means a program: (1) Consisting of at least four (4) of the employee wellness program components set forth under Section 6 hereof; and (2) Certified by the Department of Health (DOH), as a qualified employee wellness program under this Section.

SEC. 6. Employee Wellness Program Components. - The wellness program

components are the following:

(1) Health Awareness Component - A health awareness component which provides for the opportunity for periodic health screenings for health problems and referrals to appropriate follow-up measures. (2) Health Education Component - The dissemination of health information through seminars, on-line programs, counselling and other materials, which addresses the specific needs and health risks of employees. (3) Employee Engagement Component - An employee engagement component which provides for: i. The establishment of a committee to actively engage employees in the employee wellness programs through program assessment and program planning, delivery, evaluation, and improvement efforts; and ii. The tracking of employee participation in the programs. (4) Behavioral Change Component - A behavioral change component which provides for altering employee lifestyles to encourage health living through counseling, seminars and on-line programs, or self-help materials which provide technical assistance and problem-solving skills. This component may include programs relating to: i. Obesity; iI. Stress Management; III. Physical Fitness; iv. Nutrition; V. Substance Abuse; vi. Depression; vii. Anxiety; And vili. Mental Health Management And Promotion. (5) Supportive Worksite Component - A supporting worksite component which includes policies and services at the worksite which promote a healthy and balanced lifestyle, such as policies relating to:

i. The adoption of alternative work schemes/flexible work arrangements, especially for employees or personnel who reside with senior citizens, individuals with underlying conditions, minors below the age of seven (7) years of age and pregnant women; ii. Tobacco, electronic cigarette, or vape use at the worksite; ili. The nutrition of food available at the worksite through cafeterias, restaurants and vending options; and iv. Minimizing stress and promoting mental health in the worksite, and encouraging physical activity before, during or after work hours; Provided, however, that such policies shall be compliant with the minimum public health standards that may be issued by the DOH. Provided further, that despite availment of tax credit by an employer, the employee wellness program may include in the "Sustainability Report" as may be required by the Securities and Exchange Commission (SEC) to report significant economic, environmental and/or social contributions, in accordance with the globally accepted standards.

SEC. 7. DOH Certification. - The DOH, shall, as part of the certification process,

encourage employees to make the programs culturally competent and to meet the health literacy needs of the employees covered by the programs. The DOH shall not certify a program as a qualified employee wellness program unless the program has the following requisites: (1) consistent with evidence-based research and best practices, as identified by persons with expertise in employer health promotion and wellness programs; (2) includes multiple, evidence-based strategies which are based on the existing and emerging research and careful scientific reviews; and (3) includes strategies which focus on employee populations with a disproportionate burden of health problems. The DOH shall establish procedures for annual review of the implementation of the programs. Such procedures shall require revisions of programs, if necessary, to

1 ensure compliance with the requirements and require updating of the programs to the 2 extent the DOH determines necessary to reflect new scientific findings or minimum public health standards.

SEC. 8. Participation Requirement. - No tax credit shall be allowed unless the

5 DOH certifies that each employee wellness program component of the qualified 6 wellness program applies to all qualified employees of the employer. The DOH shall prescribe rules under which an employer shall not be treated as failing to meet the requirements merely because the employer provides specialized programs for employees with specific health needs or unusual employment requirements or provides a pilot program to test new wellness strategies. For purposes of this Act, "qualified employees" shall mean: (1) For employers offering health insurance coverage, an employee who is eligible for such coverage; or (2) For employers not offering health insurance coverage, an employee who works an average of not less than twenty-five (25) hours per week during the taxable year.

SEC. 9. Tax Credit Period. -

(1) In General. - Tax Credit period means the period of three (3) consecutive taxable years beginning with the taxable year in which the qualified employee wellness program is first certified by the DOH. (2) Special Rules for Existing Programs. - An employer (or predecessor) which already operates a wellness program for its employees prior to the date of the effectivity of this Act shall be eligible for certification by DOH and may avail of the incentives for five (5) consecutive taxable years beginning with the taxable year in which the qualified employee wellness program is certified by the DOH. The DOH shall prescribe rules under which the incentives under this paragraph shall not apply if the employer is required to make substantial modifications in its existing wellness program in order to qualify such program for certification as a qualified employee wellness program.

SEC. 10. Workplace Improvement Program Incentive. - For the purpose of

encouraging employers to undertake any qualified workplace improvement program, as provided in Section 11 of this Act, employers shall enjoy an additional deduction equivalent to thirty percent (30%) of the cost deductible as depreciation expense, with 5 the option to use the accelerated depreciation method for income tax purposes.

SEC. 11. Qualified Workplace Improvement Program. - A "Qualified Workplace

Improvement Program" means any of the following: (1) Retrofitting of office spaces occupied by or wherein at least ten (10) rank- and-file employees are stationed or hold office, which shall include finance energy efficiency, renewable energy, and energy retrofitting projects, as certified by the local government unit having jurisdiction of the site; (2) Installation or improvement of ventilation systems in office spaces or work areas, as certified by the local government unit (LGU) having jurisdiction of the site; or (3) Installation of office or building management systems and smart technology to reduce energy use or such equipment, systems or installations integrating the use of renewable sources of energy, as certified by the Department of Energy (DOE). Provided, that such construction works or installations are in accordance with Republic Act No. 6541, otherwise known as the "National Building Code."

SEC. 12. Period to Avail of Incentives. - The incentives granted under this Act

can be availed of within six (6) years from the effectivity of this Act, without prejudice to periods granted to fully claim such incentives.

SEC. 13. Special Rules. - No tax credit or incentive under this Act shall be

allowed with respect to any program of any taxpayer who receives a grant provided by the government in connection which such program. The DOH and DOE shall prescribe rules for the waiver of this Section with respect to any grant which does not constitute a significant portion of the funding for the qualified program.

SEC. 14. Implementing Rules and Regulations (IRR). - Within one hundred

eighty (180) days from the effectivity of this Act, the Department of Finance (DOF) and

1 the DOH, in coordination with the DOE, shall formulate the necessary rules and 2 regulations to effectively implement the provisions of this Act.

SEC. 15. Information Campaigns. - The DOH, DOF, and Department of Trade

4 and Industry (DTI) shall institute information campaigns and outreach programs to 5 inform businesses about the availability of the incentives under this Act, as well as to 6 educate businesses on how to develop programs according to recognized and promising practices and on how to measure the success of implemented programs.

SEC. 16. Appropriations. - The funds needed for the initial implementation of

this Act shall be charged against the appropriations of the DOF, DOH, and the DOE. Thereafter, such amount as may be necessary for its full implementation shall be included in the annual General Appropriations Act (GAA) as a distinct and separate item.

SEC. 17. Separability Clause. - If any provision or part hereof is held invalid or

unconstitutional, the remainder of the Act or the provision not otherwise affected shall remain valid and subsisting.

SEC. 18. Repealing Clause. - Any law, presidential decree or issuance, executive

order, letter of instruction, rule or regulation contrary to, or inconsistent with the provisions of this Act is hereby repealed, modified, or amended accordingly.

SEC. 19. Effectivity Clause. - This Act shall take effect after fifteen (15) days

following its publication in the Official Gazette or in a newspaper of general circulation. Approved,