Labor Dep’t mulls possibility of subsidizing 13th-month pay as more Filipino firms lose money

Displaced workers protest in front of the Department of Labor and Employment. Photo: Defend Jobs Philippines/FB
Displaced workers protest in front of the Department of Labor and Employment. Photo: Defend Jobs Philippines/FB

The Department of Labor and Employment is considering the possibility of asking the Duterte administration to subsidize the 13th-month pay of workers who are employed by “in distress” companies, its chief Secretary Silvestre Bello III said yesterday.

Thousands of small Filipino businesses have shut down due to the COVID-19 health crisis, while those which remain operational are barely surviving. These struggling companies, Bello said, have asked the government for help in paying their employees’ 13th-month pay.

“I’m considering what employers have proposed. Maybe we can ask Secretary [Carlos] Dominguez of Finance, I’m going to ask for help from my partner Secretary [Ramon] Lopez of DTI (Department of Trade and Industry]. We will woo Sec [Dominguez] if he can subsidize those employers who have lost money,” Bello said in English and Filipino in an interview with ABS-CBN’s Teleradyo.

Read: Make It Rain: Pay out of 13th-month cannot be deferred, says Roque

Presidential Decree (PD) 851 states that private companies should give their employees their 13th-month pay no later than Dec. 24 each year. The pay is equivalent to an employee’s one and a half monthly salary. In an interview last week, however, Bello said companies in “distress” could be exempted from giving out the mandatory benefit, leading some groups to express outrage.

“The workers want to get their 13th-month pay because that is what’s written in PD 851. The employers are not refusing them,” he said.

“[But] there is a [Filipino] saying, ‘how do you squeeze blood from a rock?’ In short, they’re willing to pay but they cannot. Business is bad. They’ve lost money, that’s what they said. They’re asking the government to subsidize them,” he added.

He added that in 1975, then-Labor Secretary Blas Ople released a set of implementing rules and regulations (IRR) for PD 851 which exempt financially-struggling companies from giving the 13th-month pay.

“Labor groups have said, ‘But that is not written in the law. Why would you follow the IRR that is not in the law?’ That’s what they said. I said, ‘That has been around since 1975. Why didn’t you question it after all these years?'” Bello said.


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