Running a business in the Philippines requires not only good products and services—but also full compliance with labor laws set by the Department of Labor and Employment (DOLE). Unfortunately, many Filipino businesses, especially small and medium enterprises (SMEs), unknowingly commit labor violations that could result in costly penalties, legal action, or reputational damage.
To protect your business and your workers, it's important to be aware of the most common DOLE violations—and more importantly, how to avoid them.
1. Underpayment or Non-Payment of Wages
Violation:
Failure to pay the prescribed minimum wage based on the regional wage board rates.
How to Avoid It:
Check the latest Regional Tripartite Wages and Productivity Board (RTWPB) wage orders.
Adjust payroll systems immediately when wage increases are announced.
Audit your salary structure regularly to ensure compliance.
2. No Payment of Overtime, Holiday, or Night Shift Differential
Violation:
Not paying extra compensation for overtime work, work done during holidays, or night shifts.
How to Avoid It:
Train payroll and HR staff on DOLE's pay computation rules.
Set up clear policies and tracking systems for overtime, holidays, and night shifts.
Avoid verbal-only agreements; everything must be documented.
3. Failure to Provide Mandatory Benefits
Violation:
Non-remittance or delayed remittance of contributions to:
SSS (Social Security System)
PhilHealth
Pag-IBIG Fund
How to Avoid It:
Register all employees with the appropriate government agencies.
Deduct employee contributions correctly and remit both employer and employee shares on time.
Use online portals (e.g., My.SSS, PhilHealth Member Portal) to monitor contributions.
4. Improper Termination of Employment
Violation:
Firing employees without just cause or due process (e.g., no notice, no hearing).
How to Avoid It:
Know the legal grounds for termination under the Labor Code.
Follow the “two-notice rule”:
Notice to Explain
Notice of Termination (after due process)
Document all incidents, warnings, and disciplinary measures.
5. Lack of Employment Contracts
Violation:
Employing workers without written contracts or using vague/unlawful terms.
How to Avoid It:
Provide clear, DOLE-compliant contracts for all employees, whether regular, probationary, or project-based.
Include job descriptions, compensation, benefits, and terms of employment.
6. Non-Compliance with Occupational Safety and Health Standards
Violation:
Failure to provide a safe working environment, conduct training, or report workplace accidents.
How to Avoid It:
Comply with RA 11058 (OSH Law).
Assign a Safety Officer and conduct mandatory OSH training.
Prepare safety policies, PPE, first aid kits, and emergency protocols.
7. Failure to Grant Service Incentive Leave (SIL)
Violation:
Not granting the mandatory 5-day paid leave to employees who have served at least one year.
How to Avoid It:
Track employment duration and apply SIL entitlements accordingly.
Integrate SIL into your leave management system and policies.
8. Non-Issuance of Payslips
Violation:
Not issuing detailed payslips that show salary breakdown, deductions, and contributions.
How to Avoid It:
Use a payroll system that automatically generates payslips.
Provide printed or digital copies every payday, as mandated by DOLE.
9. Ignoring DOLE Orders or Audit Findings
Violation:
Disregarding DOLE’s labor inspection findings or failing to submit required documents.
How to Avoid It:
Cooperate fully with DOLE inspectors.
Immediately correct any issues identified during inspections.
Keep all employment and payroll records organized and accessible.
10. No Anti-Sexual Harassment or Safe Workplace Policy
Violation:
Failing to implement workplace policies in compliance with RA 7877 (Anti-Sexual Harassment Law) and RA 11313 (Safe Spaces Act).
How to Avoid It:
Draft and implement a written anti-harassment policy.
Conduct seminars or workshops on workplace behavior and grievance mechanisms.
Designate personnel to handle complaints confidentially and fairly.
Final Thoughts
DOLE violations—whether intentional or not—can have serious consequences. But with proper knowledge, policies, and systems in place, Filipino businesses can build compliant workplaces that respect labor rights and support long-term success.
Compliance isn’t just about avoiding penalties—it’s about doing what’s right for your people and your business.
Would you like this turned into a printable checklist or infographic for HR use? I can also help you create a compliance calendar to stay on track year-round.
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