Contractual Employees

One of the most talked about subject during the election season was the proposal to abolish contractual employment in the Philippines.  According to the presidential candidates, the right of workers and employees to permanent employment must be honored by companies and business establishments.  This will help provide security not only to the employees themselves, but especially to their dependents.  This may also encourage more Pinoy workers to remain in the country instead of leaving their spouses and children behind to seek employment abroad.  It was no surprise when this subject trended on social media.

Until this proposal is enacted into law, contractual employment will remain to be an option for most companies and essentially, for most Filipino workers.  While waiting, it pays to know that contractual employees have rights and privileges that employers have to honor and provide.  If you are a contractual employee, this article is for you.

Rights of a Contractual Worker:

  1. Safe and healthful working conditions. Employers must ensure that the employee’s health and safety are not compromised in the course of his job.
  2. Labor standards such as but not limited to service incentive leave, rest days, overtime pay, holiday pay, 13th month pay, and separation pay as may be provided in the Service Agreement or under the Labor Code. Contractual employees are entitled to overtime pay for work rendered beyond the agreed number of hours.  They must also receive their 13th month pay and separation pay in case of termination of employment.
  3. Social security and welfare benefits. Government-mandated benefits such as SSS, Philhealth, and PagIBIG must be granted to both regular and contractual employees.
  4. Self-organization, collective bargaining, and peaceful concerted action. Contractual employees are free to join employee unions and other such agreements and organizations without prejudice to his employment.
  5. Security of tenure.  Contrary to popular belief, contractual employment assures the employee of paid work for the entire duration of his contract.  Unless the employer has lawful reason to terminate the employee’s contract, a contractual employee is guaranteed the job and his pay as clearly stated in his contract.

These were lifted from the Department of Labor and Employment’s website, under Department Order No. 18-A on the Rules Implementing Articles 106 to 109 of the Labor Code.

Source: http://www.dole.gov.ph/fndr/bong/files/DO%20No_%2018-A-11.pdf

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