Effects of Labor Standard Law in Regularization of Employees

EFFECTS OF LABOR STANDARD LAW IN
REGULARIZATION OF EMPLOYEES
INTRODUCTION
I.BACKGROUND OF THE STUDY
The Labor Code of the Philippines stands as the law governing employment
practices and labor relations in the Philippines. It was enacted on Labor day of 1974 by
President Ferdinand Marcos, in the exercise of his then extant legislative powers. It
prescribes the rules for hiring and termination of private employees; the conditions of work
including maximum work hours and overtime; employee benefits such as holiday pay,
thirteenth month pay and retirement pay; and the guidelines in the organization and
membership in labor unions as well as in collective bargaining. The Labor Code contains
several provisions which are beneficial to labor. It prohibits termination from employment
of Private employees except for just or authorized causes as prescribed in Article 282 to
284 of the Code. The right to trade union is expressly recognized, as is the right of a union
to insist on a closed shop. Strikes are also authorized for as long as they comply with the
strict requirements under the Code, and workers who organize or participate in illegal
strikes may be subject to dismissal. Moreover, Philippine jurisprudence has long applied
a rule that any doubts in the interpretation of law, especially the Labor Code, will be
resolved in favor of labor and against management.
There is a growing disjuncture between changing patterns of labour force
participation in highly industrialized contexts and systems of labour regulation. Policy
actors at various levels are attempting to deal with the insecurities associated with ‘new’
forms of employment such as parttime and temporary paid employment and solo self-
employment, which have disproportionate effects on women, migrants, older, and
younger workers. At the same time, most regulatory responses to precariousness
continue to rest on assumptions from an earlier era.
The provisions of written agreement to the contrary notwithstanding and regardless of the
oral agreement of the parties, an employment shall be deemed to be regular where the
employee has been engaged to perform activities which are usually necessary or
desirable in the usual business or trade of the employer, except where the employment
has been fixed for a specific project or undertaking the completion or termination of which
has been determined at the time of the engagement of the employee or where the work
or service to be performed is seasonal in nature and the employment is for the duration
of the season.
An employment shall be deemed to be casual if it is not covered by the preceding
paragraph: Provided, That any employee who has rendered at least one year of service,
whether such service is continuous or broken, shall be considered a regular employee
with respect to the activity in which he is employed and his employment shall continue
while such activity exists.
II.STATEMENT OF THE PROBLEM
OBJECTIVE:
At the end of the study,the researchers would like to:
A. To identify if the service and industry sectors have increased their labor flexibility
throughout the years and what specific industries showed the greatest increase.
B. To analyze the effects of labor cost and output to contractual employment, effects of
minimum wage and turnover rate on establishments engaged in subcontracting, and
effects of contractual employment on the average daily wage of workers.
RESEARCH QUESTIONS:
The study aims to determine the Effects of Labor Standard law in Regularization of
Employees in Taytay and Angono,Rizal for this First Semester of School Year 2019-2020.
Specifically,it seeks to answer the following questions:
1.How is the employment relationship governed and regulated?
2.Does regularization law still exist in the Philippines?
3.Why do other companies in the Philippines still want to decline the Regularization Law?
4.Does Regularization have an impact on employment?
III.SCOPE AND DELIMITATION
The scope of this research would be determine if the Labor Standard Law really affect the
regularization of the employees.This study will look into the effect of the labor standard
law in regulazation in the Philippines,wherein industries who hire their workers through
manpower agencies and those who resort off-site outsourcing will be analyzed.The study
will also revisit some portions of the Philippine Labor Code that are related to
Regularization of the employees.In addition,the study will look into the department orders
of the Department of Labor and Employment.The study also will only be limited to
outsourced workers and agency hired workers as types of regularized workers.The
analysis will also be limited to the industry and service sectors due to lack of data on the
agricultural sectors.
IV.SIGNIFICANCE OF THE STUDY
A.Regularization of workers
Primary in the workers’ demands is the end to contractualization, which has
pushed workers into accepting measly wages without benefits. The scheme allows an
employee to perform essential tasks in a company for a little less than six months per
contract without being regularized, since the worker’s contract reaches “endo” or end of
contract before the prescribed period for regularization.
B.Labor Unions
This study will either able to support or weaken the stand of labor unions in their goals of
eliminating contractualization in the Philippines.The impact of contractualization on
employment could either fortify their stand that contractualization has a negative impact
on the economy and that it does not protect the welfare of the workers or weaken their
stand that the termination of contractualization with compromise is still the best solution.

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EFFECTS OF LABOR STANDARD LAW IN

resolved in favor of labor and against management.

There is a growing disjuncture between changing patterns of labour force

participation in highly industrialized contexts and systems of labour regulation. Policy

younger workers. At the same time, most regulatory responses to precariousness

continue to rest on assumptions from an earlier era.

An employment shall be deemed to be casual if it is not covered by the preceding

whether such service is continuous or broken, shall be considered a regular employee

while such activity exists.

II.STATEMENT OF THE PROBLEM

minimum wage and turnover rate on establishments engaged in subcontracting, and

effects of contractual employment on the average daily wage of workers.

Specifically,it seeks to answer the following questions:

1.How is the employment relationship governed and regulated?

2.Does regularization law still exist in the Philippines?

4.Does Regularization have an impact on employment?

III.SCOPE AND DELIMITATION

IV.SIGNIFICANCE OF THE STUDY

Primary in the workers’ demands is the end to contractualization, which has

contract before the prescribed period for regularization.

eliminating contractualization in the Philippines.The impact of contractualization on

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