Dept. Order No. 19

8/11/2019 Dept. Order No. 19

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DEPARTMENT ORDER NO. 19

Series of 1993

Guidelines Governing the Employment of Workers in the

Construction Industry

Objective : 1. To stabilize and promote harmonious employer-

employee relations in the construction industry

2. To ensure the protection and welfare of workersemployed therein

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COVERAGE

All operations and undertakings in the construction industry

1. General building construction

2. General engineering construction

3. Special trade construction based on the classification code

of the Phil. Construction Accreditation Board of the

Construction Industry Authority of the Phils.

4. Companies and entities involved in demolition works

5. Those falling within the construction industry as

determined by the Secretary of Labor

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EMPLOYMENT STATUS

1. Classification of workers

Project Employees :

those employed in connection with a particular

construction project or phase thereof, and those

employment is co-terminous with each project or

phase of the project to which they are assigned

Non-Project Employees :those employed without reference to any particular

construction project or phase of a project

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INDICATORS OF PROJECT EMPLOYMENT

When either one or more of the following circumstances

is present :1. Duration of the project for which the worker is

engaged is reasonably determinable

2. The duration, work/service to be performed is

defined in an employment agreement and is made

clear to the employee at the time of hiring

3. Work/service is in connection with the particular

project/undertaking

4. Employee, while not engaged is free to offer his

service to other employers5. The termination of employment is reported to the

DOLE w/in 30 days following date of separation from

work

6. An undertaking in the EC to pay completion bonus

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TYPES OF NON-PROJECT EMPLOYEES

1. Probationary Employees

Those who, upon the completion of the probationary period are

entitled to regularization. Upon their engagement, probationary

employees should be informed of the reasonable standards under which

they will qualify as regular employees.

Art. VI Sec 6 Rule 1 Book VI of the implementing rules, as amended

When the employee, upon his engagement, is made to undergo a

trial period during which the employer determines his fitness toqualify for regular employment, based on reasonable standards

made known to him at the time of engagement.

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Rules Governing Probationary Employment

a. If work is apprenticeable or learnable in accordance with the standards

prescribed by the DOLE, period of probationary employment is limitedto the authorized learnership or apprenticeable period.

b. If neither apprenticeable or learnable , period of probationary employment

shall not exceed six (6) months reckoned from the date the employee

actually started working

c. Services of an employee who has not engaged on probationary basis may

be terminated only for just or authorized cause, when he fails to qualify

as a regular employee in accordance with reasonable standards

prescribed by the employer

d. The employer shall make known to the employee the standards under

which he will qualify as a regular employee at the time of engagement.

Where no standards are made known to the employee at the time,

he shall be deemed a regular employee.

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2. Regular Employees

Those appointed as such or those who have completed the probationary

period or those appointed to fill up regular positions vacated as a resultof death, retirement, resignation or termination of employment of the

regular holders thereof.

Article IV, Section 5, Rule I, Book VI of the Implementing Rules, as amended

The provisions of written agreements to the contrary notwithstanding

and regardless of the oral agreements of the parties, employment shall be

deemed regular for purposes of Book VI of the Labor Code where the

employee has been engaged to perform activities which are usually necessaryor 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 job, work or service to be performed

is seasonal in nature and the employment is for the duration of the season.

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3. Casual Employees

Those employed to perform work not related to the main line of business

of the employer. Casual employees employed for at least one year, whethercontinuous or broken shall be considered regular with respect to the activity

in which they are employed, and their employment shall continue for as

long as such activity exists, unless the employment is terminated sooner by

the employer for a just or authorized cause, or voluntarily by the employee.

Art. IV, Section 5, Rule I, Book VI, of the Implementing Rules, as amended

When an employee is engaged to perform a job, work or service which

is merely incidental to the business of the employer, and such job, work

or service is for a definite period made known to the employee at the timeof engagement ;provided, that any employee who has rendered at least one

year of service, whether such service is continuous or not, 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.

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CONTRACTING AND SUBCONTRACTING

Contracting and subcontracting certain phases of a construction project

is recognized by law, particularly wage legislations, wage orders and industrypractices.

The Labor Code and its implementing Regulations allow the contracting

out of jobs under certain conditions. Where such job contracting is permissible,

the construction workers are generally considered as employees of the contractoror sub-contractor , and subject to Art. 109 of the Labor Code, as amended.

Art. 109 Solidary Liability

Every employer or indirect employer shall be held responsible with hiscontractor or sub contractor for any violation of the Code. For purposes of

determining extent of their civil liability , they shall be considered as direct

employers.

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CONDITIONS OF EMPLOYMENT

1. Security of Tenure

Project employees are covered by Articles 280 and 282 of the Labor Code,

as amended.

2. Project Employees not entitled to Separation pay

- when their services are terminated as a result of the completion of theproject or any phase thereof

- when employees have no more work to do, or their services are no

longer needed in the particular phase of the project

3. Project employees entitled to separation pay

- project employees whose aggregate period of continuous employment

in a construction company is at least one year shall be considered regular

employees in the absence of a “ day certain” agreed upon by the parties for

termination of their relationship, thus entitled to separation pay.

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“ A “ day certain” is that which must necessarily come, although it may not

be known exactly when. This means the final completion of a project or phasethereof is in fact determinable and the expected completion is made known to

the employee, such project employee may not be considered regular, notwith-

standing the one year duration of employment in the project or phase thereof

or the one-year duration or two or more employments in the same project or

phase of the project.”

- if the project or phase of the project the employee is working on has not

been completed, and his services are terminated without just or authorized

cause and there is no showing that his services are unsatisfactory, he/she is

entitled to reinstatement with backwages to his former position or substan-tially equivalent position. If reinstatement is not possible, employee is entitled

to his salaries for the unexpired portion of the agreement.

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4. Completion of the project

- project employees separated from work as a result of the completion

of a project or any phase thereof are entitled to the pro-ratacompletion bonus if there is an undertaking for the grant of such

bonus.

- payment of a completion bonus shall be an indicator that an

employee is a project employee. When there is no such undertakingemployee may be considered a non-project employee.

- the pro rata completion bonus may be based on the industry

practice which is at least the employee’s one half month salary

for every 12 months service

5. Statutory benefits

- construction employees whether project or non-project shall enjoy all

benefits due them under the law, both monetary and non-monetary.

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6. Payment by results

- where the payment for work or services rendered is by results ,

piece rate or “pakiao” , the rate shall be determined on the basis of not less than the minimum wage applicable in the region where

the construction project is located.

7. Preventive Suspension

- Subject to Art. 277 (b) of the Code, project and non-project employees

may be preventively suspended if their continued employment poses

a serious and imminent threat to the life or property of the employer

or of their co-workers. No preventive suspension however shall last

longer than fifteen (15) days. Employer shall reinstate the worker in

his former or a substantially equivalent position, or the employer may

extend the period of suspension provided that during the period of

extension, he pays the wages and other benefits due to the worker.

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SELF-ORGANIZATION AND COLLECTIVE BARGAINING

The Department encourages the formation of “trade” unions in the

construction industry, provided that the formation or activities of a recognized

trade union will not prejudice existing bargaining units, subject to existing laws.

“TRADE UNIONS” refers to a combination of workers of the same trade

or of several allied trades, for the purpose of securing by united action the

most favorable conditions regarding wages, hours of labor and other termsand conditions of employment for its members.

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LIABILITIES/ RESPONSIBILITIES OF THE EMPLOYER

AND THE WORKERS

a. The construction company and the general contractor and/or subcontractor

shall be responsible for the workers in its employ on matters of compliance

with the requirements of existing laws and regulations on hours of work,

wages, wage-related benefits, health, safety and social welfare benefits,

including submission of work accident/illness reports, monthly report onemployees’ terminations/dismissals/suspensions and other reports.

The prime/general contractor shall exercise sound judgement and discretion

in contracting out projects to ensure compliance w/ labor standards.

B. Project & non-project employees shall observe the requirements of labor

and social legislations and reasonable company rules and regulations

on matters pertaining to their obligations.

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WAGE INCREASES

wage increases, whether mandated or agreed upon by the parties, the

prescribed increase in the wage rates of the workers in construction projects

shall be borne by the principals or clients of the construction contractors

and the contracts shall be deemed amended accordingly.

Wage rates of project employees shall depend on the skills or level of

competence of such project employees .

Dept. Order No. 19

Documents

Transcript of Dept. Order No. 19