FEB.

6, 2015

NR # 3734B

House approves bill ensuring workers claims

in case of employers bankruptcy
The House Committee on Labor and Employment has approved for floor
deliberation a measure that assures the wages and other monetary claims of workers in
case of bankruptcy of employers even without formal declaration of insolvency.
House Bill 5308, which substituted House Bill 2547 authored by TUCP Party-list
Rep. Raymond Democrito C. Mendoza, amends Article 10 of Presidential Decree No. 442,
as amended, otherwise known as the Labor Code of the Philippines. It was co-authored by
Rep. Karlo Alexei B. Nograles, chairman of the labor and employment panel.
In Committee Report 530, the panel said the bill seeks to protect the rights of the
workers to be the first lien in case of bankruptcy of the employer.
It requires that in the event of bankruptcy of the employer, the workers should be
given the first preference as regards their wages and other monetary claims, the
committee said.
The bill likewise provides that such unpaid wages and other monetary claims shall
be paid in full even without the formal declaration of bankruptcy or insolvency, the
committee added.
According to Mendoza, workers are at a disadvantage when employers start nonpayment of their wages, benefits and other entitlements in cases of employers bankruptcy.
This should not be the case because the Philippine Constitution affirms labor as
primary social and economic force and mandates the State to protect the rights of
workers and promote their welfare, Mendoza stressed.
Presidential Decree No. 442, as amended, otherwise known as the Labor Code of
the Philippines, declares as a State policy to afford protection to labor. One such
protection to labor is to satisfy their claims against the employers business, Mendoza
said.
Mendoza said the bill seeks to uphold the provision of the Labor Code.
Workers should be given first lien in case of bankruptcy to satisfy their money
claims against the business. Such money claims should not require formal declaration of
bankruptcy or insolvency to save workers and their families from slipping into the
quagmire of mere subsistence or poverty, Mendoza said. (30) mrs