Bill penalizing employers for delayed salaries filed

Manila 1st district Rep. Manuel Lopez has filed a bill seeking to penalize employers from both government and private institutions who repeatedly fail to pay their employees’ compensation on the agreed date and time without justifiable reasons or grounds.

In filing House Bill 6537, Lopez said that the measure seeks to curb the act of employers in delaying the payment of their employees’ compensation, by imposing penalties on the employers and their representatives who do not comply with the proper time of payment.

Lopez cited a survey conducted by Manulife Investor Sentiment Index in 2016 which stated that “four in 10 (41 percent) Filipino investors carry debt which is the second highest in the region after Malaysia.”

The Tondo lawmaker pointed out that “one contributing factor giving rise to this high proportion of debt is the late payment of wages and salaries.”

The vice chair of the House committee on Metro Manila development lamented that “these employees or workers in the private and government sectors continue to experience late payment of their salaries that forced them to incur debt just to be able to meet their daily needs.”

He said it is sad that employees do not get to enjoy the fruits of their labor because what they earn goes to paying interest on loans that they incur due to delayed payment of salary.

The bill also provides that this act shall apply to employees whether there exists an employer-employee relationship or not and is applicable to all establishments and undertakings whether for profit or not including government employees, managerial employees, field personnel, seasonal or project employees, members of the family of the employer who are dependent on him for support, domestic helpers, persons in the personal service of another and workers who are paid by results as determined by the secretary of labor.

The bill, co-authored by Manila 2nd district Rep. Carlo Lopez, imposes a fine of P100,000 on the payroll master if he or she fails to disburse the prescribed wages and salaries when funds are made available for this purpose.

However, if the payroll master fails to inform the employer regarding the absence of funding to satisfy the salaries of its employees, he or she shall be imposed a fine P200,000.

The bill also provides that the employer shall be liable with the payroll master for failure to pay wages and salaries without any justifiable reason and the employer shall be imposed a fine of P500,000 and the suspension of business operation for 30 days for the first offense.

For the second offense, a fine of P1 million and cessation of business operations for 90 days will be imposed on the employer, while a fine of P3 million and perpetual cessation of business operations shall be imposed on the employer for the third offense.