DOLE warns employers against illegal cash bonds from workers

An industrial machinery mechanic and maintenance worker (Photo from the official website of the Bureau of Labor Statistics at https://www.bls.gov/ooh/installation-maintenance-and-repair/industrial-machinery-mechanics-and-maintenance-workers-and-millwrights.htm)

MANILA — The Department of Labor and Employment (DOLE) has warned employers anew against the illegal collection of cash bonds from their workers.

The warning came amid reports received by DOLE that a number of employers continue to force their employees to post cash bonds for the duration of their employment.

Labor Undersecretary Joel Maglunsod said the labor department has been looking into complaints of employees.

“My office has been receiving complaints from maintenance workers because cash bonds were being unlawfully deducted from their wages without their consent or proper documentation. This is clearly a violation of the law,” Maglunsod said, referring to a 2014 labor department advisory on allowable wage deductions.

Advisory No. 11, Series of 2014, known as the “Non-Interference in the Disposal of Wages and Allowable Deductions,” states that “No employer shall make any deduction from employees wages unless indicated on the exemptions in the law.”

Maglunsod stressed that workers should have complete knowledge in the form of written documents before their employers deduct any amount of cash bonds from their wages.

The labor advisory states that exemptions are only those deductions intended for insurance premiums advanced by the employer in behalf of the employee; or those with written authorization of the employees for cash deposit to answer for loss or damage of tools, materials, or equipment supplied by the employers

The advisory emphasized that “in the event that a private security agency requires a cash deposit from its employees, the maximum amount shall not exceed the employee’s one-month basic salary and it can be deducted from their wages which shall not exceed 20 percent of the worker’s salary in a week.”

In cases of allowable deductions, the contributed amounts should be returned to employees. “If the worker’s contract has ended or they have already resigned from their positions, their cash bonds should be returned to them in full amount most especially if they did not have any financial liability to the employers,” Maglunsod said.

Maglunsod encouraged workers to continue reporting abusive employers even as he assured them of protecting their identities.

“We will protect the workers. This is the role of DOLE. We will help them and talk to the management to return the collected cash bond.  Workers should not be afraid of reporting these unlawful acts because
these are your rights,” he said.

Maglunsod also urged workers who have complaints and other concerns to call the DOLE hotline 1349; visit the nearest DOLE office, or personally coordinate with his office to immediately address their problems.  SFM