House Bill 5308, which substituted House Bill 2547 authored by TUCP Party-list Rep. Raymond Democrito C. Mendoza, amends Article 10 of Presidential Decree No. 442, as amended, otherwise known as the Labor Code of the Philippines. It was co-authored by Rep. Karlo Alexei B. Nograles, chairman of the labor and employment panel.
In Committee Report 530, the panel said the bill seeks to protect the rights of the workers to be the first lien in case of bankruptcy of the employer.
"It requires that in the event of bankruptcy of the employer, the workers should be given the first preference as regards their wages and other monetary claims," the committee said.
The bill likewise provides that such unpaid wages and other monetary claims shall be paid in full even without the formal declaration of bankruptcy or insolvency, the committee added.
According to Mendoza, workers are at a disadvantage when employers start non-payment of their wages, benefits and other entitlements in cases of employers' bankruptcy.
This should not be the case because the Philippine Constitution affirms "labor as primary social and economic force" and mandates the State to "protect the rights of workers and promote their welfare," Mendoza stressed.
"Presidential Decree No. 442, as amended, otherwise known as the Labor Code of the Philippines, declares as a State policy to afford protection to labor. One such protection to labor is to satisfy their claims against the employers' business," Mendoza said.
Mendoza said the bill seeks to uphold the provision of the Labor Code.
"Workers should be given first lien in case of bankruptcy to satisfy their money claims against the business. Such money claims should not require formal declaration of bankruptcy or insolvency to save workers and their families from slipping into the quagmire of mere subsistence or poverty," Mendoza said. - congress.gov.ph Media Relations Service-PRIB
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