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This web page
features
the full text of
Department
Order No. 14 (Series of 2001).
GUIDELINES
GOVERNING THE EMPLOYMENT AND WORKING CONDITIONS
OF
SECURITY GUARDS AND SIMILAR PERSONNEL IN THE PRIVATE SECURITY INDUSTRY.
DEPARTMENT
ORDER NO. 14
(Series of 2001)
GUIDELINES
GOVERNING THE EMPLOYMENT AND WORKING CONDITIONS
OF
SECURITY GUARDS AND SIMILAR PERSONNEL IN THE PRIVATE SECURITY INDUSTRY.
For the purpose
of ensuring the private security personnel of their rights to the
minimum
benefits mandated by law, these guidelines are hereby issued for
compliance
of all concerned.
SECTION 1. Coverage.
-
This issuance shall apply to all private security agencies or
operators,
their principals or clients, all companies allowed to directly employ
security
guards and to all security guards, whether agency or company employees,
for compliance and entitlement, respectively, to existing labor
standards
laws and benefits.
Sec. 2. Definition
of terms. - For the purpose of this Guidelines, the following
terms
are defined:chanroblesvirtuallawlibrary
a.
"Principal"
refers to any employer, company or establishment to whom a security
job,
service or work is provided by a security service contractor, whether
or
not the arrangement is covered by a written contract.
b. "Security
service contractor" is synonymous with a private security agency
which
means any person, association, partnership, firm or private
corporation,
who contracts, recruits, trains, furnishes or posts any security guard
or similar personnel to individuals, corporations, offices and
organizations,
whether private or public, for their security needs as the Philippine
National
Police may approve. Sec. 3. Employment
status. -
3.1
Employer-employee
relationship. - The security service contractor is the employer of
its security guard and similar personnel. The principal where the
security
guards are as-signed is considered an "indirect employer" for
unpaid
wages and other wage related benefits based on the joint and several
liability
of the principal with the service contractor under the
Labor
Code, unless the private security agency is owned, managed or
controlled
by the prin-cipal or the facts show that the principal controls the
manner
by which the security service is performed or where the security guard
is directly hired by the establishment.
3.2 Probationary
employment. - The probationary period of a newly hired security
guard
or similar personnel in the private security industry shall not exceed
six (6) months. While engaged on probationary basis, his/her services
may
be terminated for failure to meet the reasonable standards or criteria
made known by the security agency/employer to the guard at the time of
engagement or for just cause/s.
3.3 Regular
employment. - Any security guard or similar personnel in the
private
se-curity industry who is allowed to work after the probationary period
shall be considered a regular employee. Sec. 4. Service
contracts. - The security service contractor and/or the
principal
shall produce or submit the original copy of their service contract
when
directed to do so by the Regional Director or his/her duly authorized
representative.
The service contract shall stipulate, among others:chanroblesvirtuallawlibrary
a.
A statement that the security guards/personnel shall be paid not less
than
the minimum wage and other benefits under the Labor
Code and other existing laws;
b. An
escalation
clause to immediately effect the common provision in the wage orders
that
the prescribed increase in the wage rates of the workers shall be borne
by the principal or client of the service contractors and the contracts
shall be deemed amended accordingly.
c. A
statement
that security service contractor and/or the principal shall comply with
Social Security, Employees Compensation, Philippine Health Insurance
Corporation
and Home Development Mutual Fund laws on employees' coverage or
membership.
d. The
kind
or nature of security service.
e. The
schedule
of payment of 13th month pay per P. D. 851 and re-tirement pay per R.
A. 7641. Sec. 5. Employment
contracts. -
5.1
The security service contractor shall provide his security guards,
detachment
commanders/supervisors and other security personnel, a copy of the
employment
contract duly signed by the parties which shall contain the terms and
conditions
of employment, such as those provided under Section 5 hereof.
5.2 For
every
assignment of a security guard/personnel to a principal, the duty
detail
order shall contain the following, among others:chanroblesvirtuallawlibrary
a.
Description of job, work or service to be performed
b. Hours
and
days of work, work shift and applicable premium, overtime and night
shift
pay rates. Sec. 6. Terms
and conditions of employment. -
6.1
The security guards and similar personnel in the employ of any private
security agency or company should be duly licensed and must have passed
the physical and neuro-psychiatric examinations required by the PNP.
They
are entitled to the mandatory benefits under the Labor
Code and other existing laws, including coverage by SSS, ECC,
Philhealth
and HDMF.
6.2 The
basic
wage rate of a security guard/personnel shall not be less than the
minimum
wage rate for the non-agricultural sector in the Region where he/she is
assigned, regardless of the nature of business of the principal, or in
the Region where the security guard has been engaged, whichever is
higher.
Where a
security
guard/personnel is recruited through a branch office in another Region
where the principal is likewise located, the non-agricultural minimum
wage
rate applicable in the workplace of the principal shall govern.
Security
guards
or other personnel employed and/or assigned by a security service
contractor
in one Region but who are transferred, moved or assigned to another
Region
shall be paid based on the more beneficial wage rate.
In case
of transfer
or reassignment to another principal within a Region, the wage rates
may
be adjusted provided that the same shall not be less than the
applicable
regional minimum wage rate.
6.3. Statutory
Benefits. - The security guards/personnel are entitled to not less
than the following benefits depending on the working hours, work shift
and workdays under the given conditions, which benefits should be
included
in the cost distribution in the service contract:chanroblesvirtuallawlibrary
a.
Basic salary for all actual workdays and for the ten regular holidays
(as
holiday pay) which must not be lower than the minimum wage rates above
described and to be computed by using the factors recommended herein or
by more favorable practice of the employer. In addition, one hundred
percent
(100%) of the basic salary is due whenever work is rendered on a
regular
holiday.
b.
Allowance
in addition to the basic salary, if any, is prescribed by the
applicable
Regional Wage Order.
c.
Premium pay
of 30% of the daily rate for work on special days and rest days, which
is increased to 50% whenever work is performed on coinciding rest days
and special days.
d.
Overtime
pay for work rendered in excess of eight (8) hours a day, equivalent to
at least 25% of the regular wage rate on ordinary days and 30% on
regular
holidays, special days and rest days.
e.
Night shift
pay equivalent to 10% of the regular hourly rate for work rendered
between
10:00 pm to 6:00 am of the following day.
f.
Five (5)
day service incentive leave for every year of service which benefits
can
be availed of during days of absence and, if not used, are convertible
into its cash equivalent. A proportionate leave benefit per month may
be
derived by dividing 5 days by 12 months times the daily rate.
g.
Paternity
leave of seven (7) days with full pay. This leave shall be granted
before,
during or after childbirth or after spontaneous miscarriage by his
legal
spouse. The paternity leave with pay is granted for only four
deliveries,
including miscarriage.
h.
13th month
pay which is 1/12 of the total basic salary earned within a calendar
year. 6.4
Recommended
Computation of Equivalent Monthly Rates
Using
the applicable
daily wage rate (ADR) and a factor representing the number of paid days
in a year, the following procedures are recommended to facilitate
computation
of equivalent monthly rates (EMR).
For
those who
are required to work everyday including Sundays or rest days, special
days
and regular holidays:chanroblesvirtuallawlibrary
EMR = (ADR x 391.5) / 12
where
391.5 is derived from:chanroblesvirtuallawlibrary
302.0
- ordinary
working days
18.0 -
9 regular
holidays x 200%
2.6 - a
regular
holiday on last Sunday
of
August x
200% + (30% of 200%)
66.3 -
51 rest
days x 130%
2.6 - 2
special
days x 130%
391.5
days
considered paid in a year For those
who are
considered paid on all days including unworked Sundays or rest days,
special
days and regular holidays:chanroblesvirtuallawlibrary
EMR
= (ADR x 365) / 12
where
365 days
derived from:chanroblesvirtuallawlibrary
302
- ordinary
working days
2 -
special
days
51 -
rest days
10 -
regular
holidays
365 days For those
who do
not work and are not considered paid on Sundays/ rest days:chanroblesvirtuallawlibrary
EMR
= (ADR x 314.6) / 12
where
314.6
is derived from:chanroblesvirtuallawlibrary
302.0 -
ordinary
working days
2.6 - 2
special
days (if worked) x 130%
10.0-
regular
holidays
314.6
days
considered paid in a year For those
who do
not work and are not considered paid on Saturdays and Sundays or rest
days
EMR
= (ADR x 262.6) / 12
where
262.6
is derived from:chanroblesvirtuallawlibrary
250.0
- ordinary
working days
2.6 - 2
special
days (if worked) x 130%
10.0 -
regular
holidays
262.6
days By using
the above
indicated factors, the basic wage for the worked days and holiday pay
for
the 10 regular holidays are included in the monthly rates. Thirty
percent
(30%) rest day premium has been integrated in factor 391.5 for all the
Sundays/rest days in a year includ-ing the last Sunday of August and in
factors 314.6 and 262.6 for the two special days (November 1 and
December
31) under Executive Order No. 203 of 1987.
Not
included
in the above formula is the premium pay due an employee whenever work
is
rendered on an ordinary working day proclaimed by the President as a
special
day (that is other than Nov. 1 and Dec. 31).
6.5
Other Mandatory
Benefits. In appropriate cases, security guards/similar per-sonnel are
entitled to the mandatory benefits as listed below, although the same
may
not be included in the monthly cost distribution in the contracts,
except
the required premiums for their coverage:chanroblesvirtuallawlibrary
a.
Maternity benefit as provided under the SS Law;
b.
Separation
pay if the termination of employment is for authorized cause as
provided
by law and as enumerated below:chanroblesvirtuallawlibrary
Half-Month
Pay Per Year of Service, but in no case less than One Month Pay, if
separation
is due to:chanroblesvirtuallawlibrary
1.
Retrenchment or reduction of personnel effected by management to
prevent
serious losses;
2.
Closure or
cessation of operation of an establishment not due to serious losses or
financial reverses;
3.
Illness or
disease not curable within a period of 6 months and continued
employment
is prohibited by law or prejudicial to the employee's health or that of
co-employees; or
4.
Lack of service
assignment for a continuous period of 6 months. One
Month Pay Per
Year of Service, if separation is due to:chanroblesvirtuallawlibrary
1.
Installation of labor-saving device, such as replacement of employees
by
equipment/machinery;
2.
Redundancy,
as when the position of the employee has been found to be surplusage or
unnecessary in the operation of the agency;
3.
Impossible
reinstatement of the employee to his/her former position or to a
substantially
equivalent position for reasons not attributable to the fault of the
employer,
as when the reinstatement ordered by a competent authority cannot be
implemented
due to closure or cessation of op-erations of the
establishment/employer,
or the position to which the employee is to be reinstated no longer
exists
and there is no substan-tially equivalent position to which he/she can
be assigned.
c.
Cash income benefits under the State Insurance Fund in case of
work-related
sickness or other contingencies.
d.
Retirement
pay granted by R.
A. 7641 to any security guard/personnel who retires under an
applicable
employer plan or policy.
For
this purpose,
the security service contractor shall create or put up a trust fund for
retirement benefit. The Trust Fund Agreement shall be executed by and
between
the trustor and trustee in favor of the employee-beneficiary for
payment
of re-tirement benefit in accordance with R. A. 5487 and R.
A. 7641.
The
Fund shall
be administered and maintained by a trust company, bank, in-vestment
house,
pre-need company or corporation duly authorized to perform trust
function
exclusively for collective investment or re-investment of certain money
received in its capacity as trustee, or similar arrangement as may be
agreed
upon in ac-cordance with law.
As
such, any
payment for retirement benefits collected in advance by the contractor
from the principal/s shall be deposited by the contractor/trustor to
the
trustee in favor of the security guard as benefit upon retirement or
when
his/her employment is terminated due to authorized causes.
e.
Other benefits
granted by law, individual or collective agreement or company policy or
practice. Sec. 7.
Deductions
from salary, - No deduction shall be made from the salary of the
security
guards/personnel, except for:chanroblesvirtuallawlibrary
a.
SSS contribution
b. EC
contribution
c. HDMF
contribution
d. Philhealth
contribution
e.
Withholding
tax from income, provided a proper withholding tax receipt is issued to
the employee before the filing of income tax return every year
f. Union
dues,
if applicable
g. Other
deductions
authorized by Sec. 8.
Liability
and responsibilities of contractors and clients/principals. -
8.1
Joint
and several liability. - When the security service contractor fails
to pay the wages of its security guards/personnel, the principal shall
be jointly and severally liable with the security service contractor to
the extent of the work performed by such em-ployees under the contract,
in the same manner and extent that the principal is liable to its
direct
employees.
If there
are
wage increases or adjustments after the execution of the service
contract,
the prescribed increases in the wage rates of guards shall be borne by
the principal and the service contract shall be deemed amended
accordingly.
In the event that the principal fails to pay the prescribed increases,
the security service contractor shall be jointly and severally liable
with
the principal.
The
security
guards' contractual relationship is with their employer, the security
ser-vice
contractor. Thus, their immediate recourse for payment of wage increase
before litigation is with their direct employer, the security service
contractor.
In order for the security service contractor to comply with the new
rates,
the consideration paid by the principal for the security guards' wages
has to be adjusted in conformity with the mandated wage increase.
In case of
finding
of violations on wages and other labor standards due the security
guards,
the DOLE Regional Director shall serve summons to both the security
service
con-tractor and the principal to determine the extent of liability of
the
parties.
8.2 Solidary
liability. - For purposes of immediate relief, the principal shall
be deemed as the direct employer of the security guard/personnel in any
of the following cases, and therefore shall be solidarily liable for
whatever
monetary claims the security guard/personnel may have against his
employer:chanroblesvirtuallawlibrary
a.
When the security service contractor is found to be engaged in
labor-only
contract-ing; contracting out of work which will either displace its
employees
or reduce their regular work hours or any other prohibited activity;
b. When
the
security service contractor is declared guilty of unfair labor
practice,
i.e.,
contracting out of a job, work or service being performed by union
members
when such will interfere with, restrain or coerce employees in the
exercise
of their rights to self-organization; or
c. When
a violation
of the relevant provisions of the Labor
Code has been established by the Regional Director in the exercise
of his/her enforcement powers.
The
principal
shall also be deemed solidarily liable with the security service
contractor
to the extent of accrued claims and benefits that the latter may owe to
its security guards/personnel in the following instances:chanroblesvirtuallawlibrary
a.
When the license or business permit of the security service contractor
is cancelled, revoked or not renewed by the competent authority, or
b.
When the
contract between the principal and the security service contractor is
preterminated
for reasons not attributable to the fault of the latter. 8.3. Responsibilities
and Obligations of Security Service Contractors and Principals in the
Execution
of Service Contracts. - The service contracts or agreements between
a security service contractor and its principal/s shall ensure
compliance
with the minimum wage and other labor standards under the laws,
including
the mandatory coverage by the SSS, EC, Philhealth and HDMF.
Government
agencies
or instrumentalities engaging security services from private security
agencies
shall likewise observe compliance with all labor laws and shall require
the security service contractor to submit, among others requirements
and
as part of their bid, an under-taking to pay their workers the above
benefits.
8.4. Keeping
of records. - The principals as indirect employers shall keep and
maintain
their own separate records or files on the assignment of security
guards
in their premises during the period of the service contract, which
shall
be open for inspection and verification by this Department. The
security
agency, however, as the direct employer shall observe the rule on
general
record keeping under the Labor
Code, as amended. Sec. 9. Right
to security of tenure and due process. -
9.1
Security guards and similar personnel who have become regular employees
shall enjoy security of tenure in their employment as provided by law.
Their services can only be terminated for just or authorized causes
after
due process.
Termination
for a just cause or causes as stated in Art. 281 of the Labor
Code does not entitle the security guard/personnel to separation
pay,
unless otherwise provided in the em-ployer policy or individual
contract
or collective agreement.
9.2 Notice
of Termination. - In case of termination of employment due to
authorized
causes provided in Art. 283 and 284 of the Labor
Code and in the succeeding subsection, the employer shall serve a
written
notice on the security guard/personnel and the DOLE at least one (1)
month
before the intended date thereof.
9.3 Reserved
Status. - A security guard or similar personnel may be placed in a
workpool or on reserved status due to lack of service assignments after
expiration or termination of the service contract with the principal
where
he/she is assigned, or due to the temporary suspension of agency
operations.
No
security
guard or personnel can be placed in a workpool or on reserved status in
any of the following situations: (a) after expiration of a service
contract
if there are other principals where he/she can be assigned; (b) as a
measure
to constructively dismiss the security guard; and (c) as an act of
retaliation
for filing complaints against the employer on violations of labor laws,
among others.
If, after
a
period of 6 months, the security agency/employer cannot provide work or
give an assignment to the reserved security guard, the latter can be
dismissed
from service and shall be entitled to separation pay as described in
subsection
5.6.
Security
guards
on reserved status who accept employment in other security agencies or
employers before the end of the above six-month period may not be given
separation pay.
9.4. Preventive
suspension. - Subject to the constitutional rights of the workers
to
security of tenure and the right to be protected against dismissal
except
for a just and authorized cause and without prejudice to the
requirement
of notice under Art. 282 of the Labor
Code, a security guard/personnel may be preventively suspended if
his
continued employment poses a serious and imminent threat to life or
property
of the employer, its principal or the guard's co-workers.
No
preventive
suspension shall last longer than thirty (30) days. The security agency
shall thereafter reinstate the security guard/personnel in his/her
former
position or it may extend the period of suspension, provided that
during
the period of extension, the agency pays the wages and other benefits
due
the guard/personnel.
The
employer
shall designate a day, time and place within the period of preventive
suspension,
with notice to the employee, to hold a fact-finding investigation thus
enabling the suspended employee to be heard and assisted by a counsel
or
representative, if he/she so desires, of the charge against him/her and
thereby be exonerated; or, upon the employee's failure to vindicate
himself/herself,
to find the employee guilty and thereby, to terminate his/her
employment.
Such termination, however, shall not prejudice the right of the
employee
to ques-tion the severance of relationship in the appropriate forum.
The above
procedure
shall likewise be observed by the employer/agency in case the
employment
is terminated due to any of the just causes.
9.5. Report
of dismissal, termination or retirement. - The security service
contractor
shall submit a monthly report of all dismissals or termination,
including
retirement, effected during the month to the DOLE Regional Office
having
jurisdiction over its main or branch office using the prescribed form
and
indicating all information as required by DOLE for policy and
statistical
purposes. Sec. 10. Right
to self-organization and collective bargaining. -
The security
guards and other personnel employed by the security service contractor
shall have the right to form, join or assist in the formation of a
labor
organization of their own choosing for purposes of collective
bargaining
and to engage in concerted activities which are not contrary to law
including
the right to strike.
Sec. 11. Penal
provision. - Violation of any of the provisions of this Guidelines
which are declared unlawful or punishable by law shall be punished
accordingly.
Sec. 12. Effect
on existing issuances and agreements. -
This issuance
shall serve as a guide for the DOLE and its agencies in the
administration
and enforcement of applicable labor and social legislations and their
implementing
regulations.
Nothing herein
shall be construed to authorize diminution or reduction of benefits
being
enjoyed by the security guards and similar personnel at the time of
issuance
hereof.
This Guidelines
supersedes Department Order No. 40 s. 1994 and other existing orders
which
are inconsistent hereto and shall take effect immediately.
Manila,
Philippines, December 18, 2001.
PATRICIA
A. STO. TOMAS
Secretary
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