MANILA, Philippines — The House of Representatives on Tuesday approved on third and final reading a bill which seeks to increase the service incentive leave of employees.
Under House Bill No. 1338, which seeks to amend Article 95 of Presidential Decree No. 442 or the Labor Code of the Philippines, every employee who has rendered at least one year of service are entitled to a yearly incentive leave of 10 days with pay.
The bill, however, does not cover employees who are already enjoying vacation leave with pay of at least 10 days.
Further, the bill does not cover those employed in establishments that are “regularly employing” less than 10 employees as well as establishments “exempted from granting this benefit by the Secretary of Labor after considering the viability or financial condition of such establishment.”
Baguio City Rep. Mark Go explained that current laws do not require employers to grant their employees sickness and vacation leaves.
Instead, Labor Code provides service incentive leaves.
“These work incentives (sickness and vacation leaves) are given based on the prerogative of employers either by express stipulation on the employee’s contract or through collective bargaining agreement,” Go said in the bill’s explanatory note.
Increasing the service incentive leave of employees, Go said, would be beneficial for both employees and employers.
“Such incentives boost the morale and satisfaction of employees which are manifested in increasing productivity,” Go said.
Leave credits also minimizes the risk of health and safety issues among employees which may even be more costly for both employees and employers in the long run, he added.