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REGION IV-A - CALABARZON
MINIMUM WAGE RATE
Republic of the Philippines
DEPARTMENT OF LABOR AND EMPLOYMENT
National Wages and Productivity Commission
Regional Tripartite Wages and Productivity Board No. IV-A
City of Calamba, Laguna



Pursuant to Section 6, Rule IV of the NWPC Amended Rules of Procedure on Minimum Wage Fixing and Section 26 of Wage Order No. IV-A-12, the following rules are hereby issued for the guidance and compliance by all concerned:

RULE I - GENERAL PROVISIONS

Section 1. TITLE. This Rules shall be known as “Rules Implementing Wage Order No. IV A-12”;

Sec. 2. DEFINITION OF TERMS. As used in this Rules,

(a) “Order” means Wage Order No. IVA – 12;

(b) “Board” means the Regional Tripartite Wages and Productivity Board of Region IVA;

(c) “Commission” means the National Wages and Productivity Commission;

(d) “Department” means the Department of Labor and Employment;

(e) “Region IVA” or CALABARZON covers the Provinces of Cavite, Laguna, Batangas, Rizal, Quezon, and the Cities of Cavite, Tagaytay, Trece Martirez, Calamba, San Pablo, Sta. Rosa, Batangas, Lipa, Tanauan, Antipolo and Lucena, per Executive Order 103;

(f) “Growth Corridor Area” or areas rapidly urbanizing and industrializing parts of the Region, covering the Cities and Municipalities of Bacoor, Carmona, Cavite City, Dasmariñas, Gen. Mariano Alvarez, Gen. Trias, Imus, Kawit, Rosario, Silang, Tagaytay City, Tanza and Trece Martires City in Cavite; Biñan, San Pedro, Cabuyao, Calamba City, Los Baños, San Pablo City, Sta Cruz and Sta. Rosa City in Laguna, Batangas City, Bauan, Lipa City, San Pascual, Sto. Tomas and Tanauan City in Batangas; Antipolo City, Cainta, Rodriguez, Tanay and Taytay, in Rizal; Lucena City in Quezon;

(g) “Emerging Growth Area” or areas with rural and agricultural resource potential located at/or near the rapidly urbanizing and industrializing parts of the Region, covering the Municipalities of Indang, Naic, Noveleta and Ternate in Cavite; Paete and Pakil, in Laguna; Balayan, Calaca, Calatagan, Lemery, Mabini, Nasugbu, Rosario, and San Jose, San Juan and Taysan in Batangas; Angono, Binangonan, Pililia, San Mateo and Teresa in Rizal; Candelaria, Sariaya and Tiaong in Quezon;

(h) “Resource Based Area” or areas with predominantly rural and agricultural resource potential far from regional and Metro Manila markets, covering the Municipalities of Alfonso, Amadeo, Gen Aguinaldo, Magallanes, Maragondon and Mendez-Nuñez, in Cavite; Alaminos, Bay, Calauan, Cavinti, Famy, Kalayaan, Liliw, Luisiana, Lumban, Mabitac, Magdalena, Majayjay, Nagcarlan, Pagsanjan, Pangil, Pila, Rizal, Sta. Maria, Siniloan and Victoria in Laguna; Agoncillo, Alitagtag, Balete, Cuenca, Ibaan, Laurel, Lian, Lobo, Malvar, Mataas na Kahoy, Padre Garcia, San Luis, San Nicolas, Sta Teresita, Taal, Talisay, Tingloy and Tuy in Batangas; Baras, Cardona, Jala-Jala and Morong in Rizal; Agdangan, Alabat, Atimonan, Buenavista, Burdeos, Calauag, Catanauan, Dolores, Gen. Luna, Gen. Nakar, Guinayangan, Gumaca, Infanta, Jomalig, Lopez, Lucban, Macalelon, Mauban, Mulanay, Padre Burgos, Pagbilao, Panukulan, Patnanungan, Perez, Pitogo, Plaridel, Polilio, Quezon, Real, Sampaloc, San Andres, San Antonio, San Francisco, San Narciso, Tagkawayan, Tayabas and Unisan in Quezon;

(i) “Minimum Wage Rates” refer to the lowest wage rate(s), as fixed by the Board, that an employer is obliged to pay his workers;

(j) “Non-Agriculture” refers to establishments and industries other than agriculture and retail or service, regardless of employment size;

(k) “Agriculture” refers to farming in all its branches and among others, includes the cultivation and tillage of the soil, production, cultivation, growing and harvesting of any agricultural or horticultural commodities, dairying, raising of livestock or poultry, the culture of fish and other aquatic products in farms or ponds, and any activities performed by a farmer or on farm as an incident to or in conjunction with such farming operations, but does not include the manufacturing and/or processing of sugar, coconut, abaca, tobacco, pineapple, aquatic or other farm products;

(l) “Plantation Agricultural Enterprise” is one engaged in agriculture with an area of more than twenty four (24) hectares in a locality or which employs at least twenty (20) workers. Any other agricultural enterprise shall be considered as "Non-Plantation Agricultural Enterprise";

(m)“Cottage/Handicraft Establishment” is one engaged in an economic endeavor in which the products are primarily done in the home or such other places for profit which requires manual dexterity and craftsmanship and whose capitalization does not exceed P 1.5M (in conformity with SMED Resolution No. 3, series of 1995) regardless of previous registration with the defunct NACIDA;

(n) “Retail Establishment” refers to an entity principally engaged in the sale of goods to end users for personal or household use. A retail establishment that regularly engages in wholesale activities loses its retail character. For purposes of this Implementing Rules, retail establishments must be regularly employing not more than 10 workers;

(o) “Service Establishment” refers to an entity principally engaged in the sale of services to individuals for their own or household use and is generally recognized as such. For purposes of this Implementing Rules, service establishments must be regularly employing not more than 10 workers;

(p) “Barangay Micro Business Enterprise” refers to any business entity or enterprise granted a Certificate of Authority under Republic Act No. 9178;

(q) “Productivity Based Schemes”:

Productivity Improvement Program” refers to any intervention or scientific process designed to involve everyone in the organization in improving productivity through more efficient use/optimization of resources, on time production and delivery of quality goods and services that satisfy the requirements of the customer, such as: good housekeeping, quality circles, cost reduction, work simplification/process improvement, management control system, among others. It focuses on four (4) major areas of concern:

a) quality improvement;

b) competitive pricing;

c) on time delivery;

d) safe and healthy work environment;

Gainsharing Scheme” refers to a system defining the manner or arrangement by which employees and company/employers share the financial gains arising from improved productivity and profitability based on predetermined set of policies, criteria and formula that governs both parties in interpreting and implementing the same.

(r) “Exporter” means any person, natural or juridical, licensed to do business in the Philippines, engaged directly or indirectly in the manufacture or trade of products or services which earn at least fifty percent (50%) of its normal operating revenues from the sale of its products or services abroad for foreign currency. In the case of indirect exporters, the requirement that products or services be sold “abroad for foreign currency “ shall not apply as, by the very nature of their business, the sale of their products or services takes place in the Philippines and such indirect exporters are usually paid in Philippine currency;

(s) “New Business Enterprise” refers to an establishment, including non-profit institutions, established within two (2) years from effectivity of the Wage Order based on the latest registration with the appropriate government agency such as SEC, DTI, CDA and Mayor’s Office;

(t) “Distressed Establishment” refers to an establishment which meets the criteria enumerated in Sec. 3A of the National Wages and Productivity Commission (NWPC) Guidelines No. 02 S. 2007, known as Amended Rules on Exemption from Compliance with the Prescribed Wage Increases/Cost of Living Allowances Granted by the Regional Tripartite Wages and Productivity Boards;

(u) “Notice to Workers (NTW)” is a document that informs workers of the filing for exemption/deferment of the applicant –firm with the Board. The NTW shall be under oath and shall contain information on the application and its supporting documents filed with the Board. The proper recipient of the NTW shall be the following; a.) union president, in case of organized establishments or b.) worker’s representative, in case of non-unionized establishment;

(v) “Acknowledgement Receipt (AR)” is a document that shows that the NTW was received by the proper recipient. The AR shall be under oath and shall contain information on the recipient, his\her union affiliation, his/her company position/designation and/or information on what interest he/she represents. The recipient is deemed responsible for informing co-workers on the content of the NTW and shall answer of misrepresentation should they arise.

RULE II - NEW MINIMUM WAGE RATES

Sec. 1. AMOUNT OF INCREASE. The amount of increase in the minimum wage rates of all workers and employees in the private sector in the region effective September 27, 2007 are as follows:

  1. Growth Corridor Area P 10.00 - 13.00

  2. Emerging Growth Area P 8.00 - 9.00

  3. Resource Based Area P 6.00

Sec. 2. NEW MINIMUM WAGE RATES. The new daily minimum wage rates of private workers and employees in Region IVA effective September 27, 2007 are as follows:

 

AREAS


Non- Agriculture


Agriculture



Cottage

Retail & Service Establishment employing not more than 10 workers


Plantation


Non-Plantation

GROWTH CORRIDOR AREA

300.00

275.00

255.00

263.00

195.00

EMA/1

CAVITE
Bacoor, Imus

LAGUNA
Biñan, San Pedro

RIZAL
Cainta, Taytay

CAVITE
Carmona, Cavite City, Dasmariñas, Gen. Trias, Rosario 

282.00

257.00

237.00

245.00

177.00

LAGUNA
Cabuyao, Calamba City, Los Baños,San Pablo City, Sta. Cruz, Sta. Rosa.

RIZAL
Antipolo City

CAVITE
Kawit, Silang, Tagaytay City, Tanza, Trece Martirez 

277.00

252.00

232.00

240.00

174.00

BATANGAS
Batangas City, Bauan, Lipa City, San Pascual, Sto. Tomas, Tanauan City

QUEZON
Lucena City

EGA/2

277.00

252.00

232.00

240.00

172.00

CAVITE
General Alvarez

RIZAL
Rodriguez, Tanay

EMERGING GROWTH AREA

260.00

235.00

215.00

223.00

159.00

BATANGAS
Balayan, Calaca, Calatagan, Lemery, Mabini, Nasugbu, Rosario, San Jose 

RIZAL
Angono, Binangonan, San Mateo

QUEZON
Candelaria, Sariaya

CAVITE
Indang, Naic, NoveletaTernate

249.00

224.00

204.00

212.00

146.00

LAGUNA
Paete, Pakil

BATANGAS
San Juan

RIZAL
Pililia

QUEZON
Tiaong

RBA/3

244.00

219.00

199.00

207.00

145.00

BATANGAS
Taysan

RIZAL
Teresa

RESOURCE BASED AREA

242.00

217.00

197.00

205.00

143.00

CAVITE
Alfonso, Amadeo, Gen. Aguinaldo, Magallanes, Maragondon, Mendez-Nunez

LAGUNA
Alaminos, Bay, Calauan, Cavinti, Famy, Kalayaan, Liliw, Luisiana, Lumban, Mabitac, Magdalena, Majayjay, Nagcarlan, Pagsanjan, Pangil, Pila, Rizal, Sta Maria, Siniloan, Victoria

BATANGAS
Agoncillo, Alitagtag, Balete, Cuenca, Ibaan, Laurel, Lian, Lobo, Malvar, Mataas na Kahoy, Padre Garcia, San Luis, San Nicolas, Sta. Teresita, Taal, Talisay, Tingloy, Tuy

RIZAL
Baras, Cardona, Jala-Jala, Morong

QUEZON
Agdangan, Alabat, Atimonan, Buenavista, Burdeos, Calauag, Catanauan, Dolores, Gen. Luna,
Gen. Nakar, Guinayangan, Gumaca, Infanta, Jomalig, Lopez, Lucban, Macalelon, Mauban, Mulanay, Padre Burgos, Pagbilao, Panulukan, Patnanungan, Perez, Pitogo, Plaridel, Polilio, Quezon, Real, Sampaloc, San Andres,
San Antonio,
San Francisco,
San Narciso, Tagkawayan, Tayabas, Unisan 

224.00

204.00

184.00

192.00

136.00

EMA1/ Reclassified Extended Metropolitan Area to Growth Corridor AreaEGA2/ Reclassified Emerging Growth Area to Growth Corridor AreaRBA3/ Reclassified Resource Based Area to Emerging Growth Area

All workers covered by the Order receiving less than the prescribed minimum wage(s) shall be adjusted at least to the new daily minimum wage rates prescribed herein.

Sec. 3. COVERAGE. The minimum wage rates prescribed under the Order shall apply to all minimum wage workers and employees in all private establishments in Region IV-A regardless of their position, designation or status of employment and irrespective of the method by which their wages are paid. Not covered by this Wage Order are household or domestic helpers, persons employed in the personal service of another, including family drivers and workers of Barangay Micro Business Enterprises (BMBEs) with Certificates of Authority, pursuant to R. A. 9178.

Sec. 4. BASIS OF MINIMUM WAGE RATES. The minimum wage rates prescribed herein shall be for the normal working hours, which shall not exceed eight hours work a day.

Sec. 5. APPLICATION TO WORKERS PAID BY RESULTS. All workers paid by results, including those who are paid on piecework, takay, pakyaw, or task basis, shall receive not less than the applicable minimum wage rates prescribed under the Order for the normal working hours which shall not exceed eight (8) hours work a day, or a proportion thereof for work of less than the normal working hours.

The adjusted minimum wage rates of workers paid by results shall be computed in accordance with the following steps:

a) Amount of increase in AMW
    ------------------------------------ x 100 = % increase;
             Previous AMW

b) Existing rate/piece x % increase = Increase in rate/piece;

c) Existing rate/piece + Increase in rate/piece = Adjusted rate/piece

    Where:  AMW is the applicable minimum wage rate.

The wage rates of workers who are paid by results shall be continued to be established in accordance with Article 101 of the Labor Code, as amended and its Implementing Regulations.

Sec. 6. PRODUCTIVITY BASED SCHEMES. In order to enhance the competitiveness of business, both labor and management are encouraged to adopt productivity improvement schemes such as: good housekeeping, quality circles, labor management cooperation, among others at the company level, set up the mechanisms for productivity improvement programs and gain sharing schemes. An advisory guidelines is contained in this Implementing Rules attached as Annex B.

Sec. 7. APPLICATION TO SPECIAL GROUPS OF WORKERS. Wages of apprentices and learners shall in no case be less than seventy five percent (75%) of the applicable minimum wage rates prescribed in the Order. Apprenticeship shall be guided by the Kasanayan at Hanapbuhay Program – an Apprenticeship and Employment Program of the Department of Labor and Employment.

All recognized learnership and apprenticeship agreements entered into before the effectivity of the Order shall be considered automatically modified insofar as their wage clauses are concerned to reflect the adjustments prescribed under the Order.

All qualified handicapped workers shall receive the full amount of the minimum wage rate prescribed herein pursuant to R.A. 7277.

Sec. 8. APPLICATION TO PRIVATE EDUCATIONAL INSTITUTIONS. In the case of private educational institutions, the share of covered workers and employees in the increase of tuition fees for school year 2007-2008 shall be considered as compliance with the wage increase prescribed in this Order. However, payment of any shortfall in the prescribed increase set forth in this Order shall be covered starting SY 2008-2009.

Private educational institutions, which have not increased their tuition fees for SY 2007-2008, may defer compliance with the provisions of the Order until the beginning of SY 2008-2009. In any case all private educational institutions shall implement the prescribed increase in the Order starting SY 2008-2009.

Sec. 9. APPLICATION TO CONTRACTORS. In the case of contracts for construction projects and for security, janitorial and similar services, the prescribed increase in the wage rate of covered workers shall be borne by the principals or clients of the construction/service contractor and the contracts shall be deemed amended accordingly. In the event, however, that the principals or clients fail to pay the prescribed wage rates, the contractors shall be jointly and severally liable with the principals or clients.

For contracts entered into by registered BMBEs, their non coverage to the payment of the minimum wage does not in anyway extend to the principals or clients of the said BMBE.

Sec. 10. APPLICATION TO MOBILE, BRANCH AND TRANSFERRED EMPLOYEES.

Mobile and Branch Employees

The minimum wage rates of mobile workers, who by nature of their work have to travel, shall be those applicable in the domicile or head office of the employer. The minimum wage rates of workers working in branches or agencies of establishments within or outside the Region shall be those applicable in the place where they are stationed or based.

Transfer of Personnel

The transfer of personnel to areas outside the Region or from a high rate city/municipality to a lower rate city/municipality shall not be a valid ground for the reduction of the wage rates being enjoyed by the workers prior to such transfer. Workers transferred to other Regions or from a lower rate municipality to a higher rate municipality shall be entitled to the minimum wage rates applicable therein.

RULE III - DEFERMENT

Section 1. DEFERMENT FOR EXPORT ESTABLISHMENTS. Upon application with and as determined by the Board, establishments in the export industry which earn at least fifty percent (50%) of their normal operating revenues from export sales and whose product pricing is computed using labor costs based on previous mandated rates, may be granted deferment from the Order but such deferment shall not to exceed one year.

These conditions shall be verified based on predominant and accepted documents used in the industry that should show applicant entered into contracts before October 5, 2007, but these contracts shall be concluded, that is, produced and delivered, and consequently paid for between the periods October 5, 2007 to October 4, 2008.

Sec. 2. APPLICATION FOR DEFERMENT. Application for deferment shall be filed not later than seventy–five (75) days from the date of publication of the approved Rules Implementing this Order, provided that all required documents in support of the application must be filed within the said 75-day filing period and that no further extension of filing and submission of required documents shall be allowed. The date of mailing shall be the date of filing.

Documents Required:

  1. Application letter under oath with attendant information on the firm’s principal economic activity, amount of total assets, date of start of operation, the regular number and names of workers with their corresponding salaries and wages and dates of employment, certificate of compliance with the prescribed minimum wage under Wage Order immediately preceding the new Wage Order; and

  2. Proof of notice of filing of the application to the President of the union/contracting party if one is organized in the establishment, or if there is no union, a copy of the circular giving general notice of the filing of application to all workers in the establishment. The proof of notice, which may be translated in the vernacular, shall state that the workers’ representative was furnished a copy of the application with all the supporting documents. The notice shall be posted in a conspicuous place in the establishment.

Additional Supporting Documents Required:

Direct Exporters

  1. Proof of 50% Export Sales Status.

  2. Contracts with Foreign Buyers/s entered into before October 5, 2007, but for production, delivery and subsequent payment between the periods October 5, 2007 to October 4, 2008.

  3. Invoices, Bills of Lading, Confirmed Inward Letters of Credit, Lading Certificate and other Commercial documents with reference to the contracts described above.

Indirect Exporters

  1. Certification from Consignee/s that export products consigned were in fact sold by consignee/s.

  2. Proof of 50% Export Sales Status of Consignee/s

  3. Contracts with Consignee/s entered into before October 5, 2007, but for production, delivery and subsequent payment between the periods October 5, 2007 to October 4, 2008.

  4. Purchase Orders, Invoices, Receipts and other Commercial Documents with reference to contracts described above.

Sec. 3. BASIS AND DURATION OF DEFERMENT. The allowable length of period of deferment grant shall be based on the weighted value or volume of each specific contract with the time and/or expected time of receipt of payment of each specific contract in proportion to the total contract value or volume for a one year period.

Sec. 4. EFFECT OF FILING OF APPLICATION FOR DEFERMENT. Whenever an application for deferment has been filed with the Regional Board, action by the Regional Office of the Department of Labor and Employment on any complaint for alleged non-compliance with the Order shall be deferred pending resolution of the application for deferment by the Regional Board.

Sec. 5. EFFECT OF DISAPPROVED APPLICATION FOR DEFERMENT. In the event that an application for deferment is not granted, covered workers and employees shall receive the appropriate compensation due them as provided for in the Order plus interest of one percent (1%) per month retroactive to the effectivity of the said Order or from the period not covered by the grant of deferment, whichever is applicable.

Sec. 6. MOTION FOR RECONSIDERATION. An aggrieved party may file with the Board a motion for reconsideration of the decision on the application for exemption within ten (10) days from its receipt and shall state the particular grounds upon which the motion is based, copy furnished the other party and the DOLE Regional Office concerned.

No second motion for reconsideration shall be entertained in any case. The decision of the Board shall be final and executory unless appealed to the Commission.

RULE IV - EXEMPTION

Section 1. EXEMPTION. Upon application with and as determined by the Regional Board in accordance with the applicable rules and regulations, New Business Enterprises and Distressed Establishments as defined in the NWPC Guidelines No. 02 S. 2007 “Amended Rules on Exemption from Compliance with the Prescribed Wage Increases/Cost of Living Allowances Granted by the Regional Tripartite Wages and Productivity Boards” may be exempted from compliance with the Order. The criteria for exemption for these exemptible categories shall be those provided for in the said Amended Rules on Exemption except, in the case of Distressed Establishments, only full or partial exemption may be allowed.

1. New Business Enterprise (NBE) Documents Required:

  1. Application letter under oath with attendant information on the firm’s address of economic activity, principal economic activity and product/s, date of start of operation provided it is registered with appropriate government agency, amount of total assets/investments, number of employees employed with the corresponding basic salaries/wages;

  2. Proof of notice of filing of the application to the President of the union/contracting party if one is organized in the establishment, or if there is no union, a copy of the circular giving general notice of the filing of application to all workers in the establishment. The proof of notice, which may be translated in the vernacular, shall state that the workers’ representative was furnished a copy of the application with all the supporting documents. The notice shall be posted in a conspicuous place in the establishment;

  3. Business Permit or Certificate of registration with appropriate government agency such as SEC, DTI, CDA, Mayors Office; and

  4. Certification (if any) issued by Special Economic Zones.

2. Distressed Establishment

Documents Required:

  1. Application letter under oath with attendant information on the firm’s address of economic activity, principal economic activity and product/s, amount of total assets, date of start of operation, regular number and names of workers with their corresponding basic salaries and wages and dates of employment, certificate of compliance with the prescribed minimum wage under Wage Order immediately preceding the new Wage Order;

  2. Proof of notice of filing of the application, to the President of the union/contracting party if one is organized in the establishment, or if there is no union, a copy of the circular giving general notice of the filing of application, to all workers in the establishment. The proof of notice, which may be translated in the vernacular, shall state that the workers’ representative was furnished a copy of the application with all the supporting documents. The notice shall be posted in a conspicuous place in the establishment;

  3. Full or Partial Exemption. Audited financial statements (together with the Auditor’s opinion and the notes thereto) for the last two (2) full accounting periods preceding the effectivity of the Order (2005-2006) filed with and stamped “received” by the appropriate government agency; and

Sec. 2. SUBMISSION OF OTHER DOCUMENTS. The Board may require the submission of other pertinent documents to support the application for exemption.

Sec. 3. APPLICATION FOR EXEMPTION: Application for exemption shall be filed not later than seventy–five (75) days from the date of publication of the approved Rules Implementing this Order, provided that all required documents in support of the application must be filed within the said 75-day filing period and that no further extension of filing and submission of required documents shall be allowed. The date of mailing shall be the date of filing.

In the case of New Business Enterprises, applications shall be filed not later than sixty (60) days after the date of registration.

The application shall be under oath and accompanied by complete supporting documents as enumerated under Sec. 1 Rule IV of this Implementing Rules.

Sec. 4. EXTENT AND DURATION OF EXEMPTION. The extent and duration of exemption shall be in accordance with Sec. 5 of the NWPC Guidelines No. 02 S. 2007 except, in the case of Distressed Establishments, only full or partial exemption may be allowed as follows:

Full exemption of one (1) year from effectivity of the Order shall be granted to all exemptible categories of establishments that meet the applicable criteria for exemption.

Partial exemption of 50% from effectivity of the Order with respect to the period of exemption shall be granted only in the case of distressed establishments.

Sec. 5. DISTRESSED PRINCIPAL. Exemption granted to a distressed principal shall not extend to its contractor in case of contract (s) for construction, security, janitorial and/or similar services with respect to the employees of the latter assigned to the former.

Sec. 6. ADOPTION OF PRODUCTIVITY IMPROVEMENT PROGRAMS. Establishments granted exemption are required to adopt productivity improvement initiatives or schemes to improve business viability. The Board shall provide technical assistance in the development of a productivity improvement program in the establishment.

Sec. 7. EFFECT OF FILING OF APPLICATION FOR EXEMPTION. Whenever an application for exemption has been filed with the Regional Board, action by the Regional Office of the Department of Labor and Employment on any complaints for alleged non-compliance with this Order shall be deferred pending resolution of the application for exemption by the Regional Board.

Sec. 8. EFFECT OF DISAPPROVED APPLICATION FOR EXEMPTION. In the event that the application for exemption is not approved, covered workers shall be paid the mandated wage increase as provided for under the Order retroactive to the date of effectivity of the Order plus simple interest of one percent (1%) per month.

Sec. 9. MOTION FOR RECONSIDERATION. An aggrieved party may file with the Board a motion for reconsideration of the decision on the application for exemption within ten (10) days from receipt of the decision, stating the particular grounds upon which the motion is based, copy furnished the other party and the Regional Office of the Department.

No second motion for reconsideration shall be entertained in any case. The decision of the Board shall be final and executory unless appealed to the Commission.

RULE V - WAGE DISTORTION

Sec. 1. WAGE DISTORTION. A situation where an increase in prescribed wage rates results in the elimination or severe contraction of intentional quantitative differences in wage or salary rates between and among employee groups in an establishment as to effectively obliterate the distinctions embodied in such wage structure based on skills, length of service, or other logical bases of differentiation.

Sec. 2. CORRECTION OF WAGE DISTORTION. Where the application of any prescribed wage increase by virtue of a Wage Order issued by the Board results in distortions of the wage structure within an establishment, the employer and the union shall negotiate to correct the distortions. Any dispute arising from wage distortions shall be resolved through the grievance procedure under their collective bargaining agreement, and if it remains unresolved, through voluntary arbitration. Unless otherwise agreed by the parties in writing, such dispute shall be decided by the voluntary arbitrator or panel of voluntary arbitrators within ten (10) days from the time said dispute was referred to voluntary arbitration.

In cases where there are no collective agreements or recognized labor unions, the employers and workers shall endeavor to correct such distortions. Any dispute arising there from shall be settled through the National Conciliation and Mediation Board and, if it remains unresolved after ten (10) days of conciliation, shall be referred to the appropriate branch of the National Labor Relation Commission (NLRC). It shall be mandatory for the NLRC to conduct continuous hearings and decide the dispute within twenty (20) days from the time said dispute is submitted for compulsory arbitration.

The pendency of a dispute arising from a wage distortion shall not in any way delay the applicability of any increase in prescribed wage rates pursuant to the provisions of the Wage Order.

Sec. 3. FORMULA. Advisory formulae to correct distortion are contained in this Implementing Rules attached as Annex A .

RULE VI - APPEAL

Sec. 1. APPEAL ON THE WAGE ORDER. Not later than ten (10) days from the date of publication of the Order, any party aggrieved by a Wage Order issued by the Board may appeal such Order to the Commission by filing a verified appeal with the Board in three (3) printed legible copies. The appeal shall be accompanied by a memorandum of appeal which shall state the grounds relied upon, the arguments in support of the appeal and the relief being sought.

The Board shall serve notice of the appeal to concerned parties. Failure to file an appeal within the reglementary period fixed under this Sec. or to submit the required documents shall be a ground for dismissal of the appeal.

A motion for reconsideration on the Wage Order filed with the Board, shall be treated as an appeal subject to the requisites for the perfection of appeal under the NWPC Guidelines No. 01 Series of 2007.

An appeal may be filed on the grounds of non-conformity with prescribed guidelines and/or procedures, questions of law, and grave abuse of discretion.

Sec. 2. APPEAL ON EXEMPTION. Any party aggrieved by the decision of the Board may file an appeal to the Commission, through the Board, in two (2) legible copies, not later than ten (10) days from date of receipt of the decision.

The appeal, with proof of service to the other party, shall be accompanied with a memorandum of appeal which shall state the date appellant received the decision, the grounds relied upon and the arguments in support thereof.

RULE VII - SPECIAL PROVISIONS

Sec. 1. COMPLAINTS FOR NON-COMPLIANCE. Complaints for non-compliance with the Order shall be filed with the Regional Office of the Department having jurisdiction over the workplace and shall be the subject of enforcement proceedings under Articles 128 and 129 of the Labor Code, as amended.

Sec. 2. NON-DIMINUTION OF BENEFITS. Nothing in the Order and in this Rules shall be construed to reduce any existing wage rates, allowances and benefits of any form under existing laws, decrees, issuances, executive orders, and/or under any contract or agreement between the workers and the employers.

Sec. 3. PENAL PROVISION. Pursuant to provisions of Sec. 12 of RA 6727, as amended by RA 8188, any person, corporation, trust, firm, partnership, association or entity which refuses or fails to pay the prescribed increase in the Order shall be punished by a fine of not less than Twenty-five Thousand pesos (P25,000.00) nor more than One Hundred Thousand Pesos (P100,000.00) or imprisonment of not less two (2) years nor more than four (4) years or both such fine and imprisonment at the discretion of the court. Provided, that any person convicted under the order shall not be entitled to the benefits provided for under the Probation Law.

If the violation is committed by a corporation, trust or firm, partnership, association or any other entity, the penalty of imprisonment shall be imposed upon the entity’s responsible officers, including but not limited to the president, vice president, chief executive officer, general managers, managing director or partner.

The employer/s concerned shall be ordered to pay an amount equivalent to double the unpaid benefits owing to the employees: Provided that payment of indemnity shall not absolve the employer from criminal liability imposable under this Act.

Sec. 4. PROHIBITION AGAINST INJUNCTION. No preliminary or permanent injunction or temporary restraining order may be issued by any court, tribunal or other entity against and proceedings before the Commission or Boards.

Sec. 5. FREEDOM TO BARGAIN. The Order shall not be construed to prevent workers in particular firms or enterprises of industries from bargaining for higher wages and flexible working arrangements with their respective employers.

Sec. 6. REPORTING REQUIREMENTS. Any person, company, corporation, partnership or any entity engaged in business shall submit a verified itemized listing of their labor component to the Board not later than January 31, 2008 and every year thereafter in accordance with the form prescribed by the Commission.

Sec. 7. REPEALING CLAUSE. All orders, issuances, rules and regulations on wages, or parts thereof inconsistent with the provisions of the Wage Order and this Rules are hereby repealed, amended or modified accordingly.

Sec. 8. SEPARABILITY CLAUSE. If any provision or part of the Order and this Rules, or the application thereof to any person or circumstance is held invalid or unconstitutional, the remainder of the Order and this Rules or the application of such provision or part thereof to other persons or circumstances shall not be affected thereby.

Sec. 9. EFFECTIVITY. This Rules shall take effect on September 27, 2007.

Done this 7th day of September 2007 in Calamba City, Laguna, Philippines.


(Sgd) ATTY. RICARDO S. MARTINEZ, SR., CESO III

Chairperson

(Sgd.) SEVERINO C. SANTOS
Vice-Chairperson
(Sgd.) MARILOU Q. TOLEDO
Vice-Chairperson
   
(Sgd.) BENJAMIN P. BASQUIÑAS, JR
Worker Representative
(Sgd.) JUANITO S. FACUNDOWorker Representative
   
TOOK NO PART
(Out of the Country)
RENATO B. ALMEDA
Employer Representative


(Sgd.) LUCILA C. TARRIELA

Employer Representative
   
Approved this 1st of October, 2007, subject to the notations contained on pages 14 to 15 thereof.

(Sgd.) ARTURO D. BRION

Secretary
DEPARTMENT OF LABOR AND EMPLOYMENT



NOTATIONS
ON THE RULES IMPLEMENTING WAGE ORDER NO. IVA-12

1. On the following Sections/Rules:

a) Sections 1 and 2, Rule II. AMOUNT OF INCREASE and NEW MINIMUM WAGE RATES, respectively;

b) Sec. 1, Rule III. DEFERMENT FOR EXPORT ESTABLISHMENTS;

c) Sec. 9, Rule VII. EFFECTIVITY.

The dates indicated in these sections should be changed to the actual date of   effectivity.

2. On Sec. 1.2, Rule IV. EXEMPTION.

The following should be added to the provision to read as follows:

"d. Conditional Exemption

d.1  Audited financial statement (together with the Auditors opinion and the notes  thereto) for the last full accounting period and interim quarterly financial  statement/s for the period immediately preceding the effectivity of the Order.

d.2 To confirm the grant of conditional exemption, audited financial statements for the last full accounting period, stamped "received" by the appropriate government agency, to be submitted within 30 days from the lapse of the one-year exemption period.

"e.  For Banks and Quasi-banks

Certification from Bangko Sentral ng Pilipinas that it is under  receivership/liquidation.

"f.  For Establishments Under Corporate Rehabilitation

Order from a court of competent jurisdiction that the establishments is under rehabilitation."

3.  On Sec. 4 (3rd paragraph),

Rule IV
EXTENT AND DURATION OF EXEMPTION.

 The following provisions should be added to read as follows:

"Conditional exemption of one (1) year from effectivity of the Order shall be granted only in the case of distressed establishments under Sec. 3.A of the Amended Rules on Exemption. The conditional exemption shall be confirmed, as follows:

c.1  For Corporations.

When deficit as defined in Sec. 1(N), Amended Rules on Exemptions, as    of the last full accounting period amounts to 20% or more of the paid-up capital    for the same period;

c.2  For Single Proprietorships And Partnerships

When the net loss for the last two (2) full accounting periods immediately    preceding the effectivity of the Order amounts to 20% or more of the total    invested capital at the beginning of the period under review;

c.3  For Non-Stock, Non-Profit Organizations

When the net loss for the last two (2) full accounting periods immediately preceding the effectivity of the Order amounts to 20% or more of the fund balance/members' contribution at the beginning of the period.

In the absence of such actual losses, the company shall pay its workers the wageincreases due them under the Order, retroactive to the effectivity of the Order."


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