In view of the restrictions limiting operations and mobility during this time, the DOLE has suggested a number of options that companies may adopt in relation to their workforce.
Adoption of Flexible Working Arrangements or Alternative Work Schemes
1. What are Flexible Work Arrangements?
Flexible Work Arrangements are alternative schedules or arrangements other than the standard and traditional workweeks. Flexible Work Arrangements are recommended over the outright closure of the business or the termination of the services of its employees.
It is emphasized that these alternative coping mechanisms and remedial measures are temporary and are subject to the prevailing conditions of the company.
2. What are some examples of Flexible Work Arrangements?
There are no set guidelines of how flexible work arrangements should be as they should be customized to the requirements of the business. The DOLE has suggested the following examples in Department Advisories 02-04, 02-09 and 04-10, and Labor Advisories 09 and 17-20:
a. Reduction of work hours and/or workdays.
In this scheme, the normal workdays per week are reduced. This arrangement, however, should not last more than six (6) months.
b. Rotation of workers
This is where the employers are alternately required to work within the workweek.
c. Forced leaves
This requires employees to go on leave for several days.
d. Broken Time Schedule
This is an arrangement where the work schedule is not continuous but the work hours within the day or the week remain the same.
e. Flexi-holidays schedule
Under this arrangement, employees agree to avail the holidays at some other days, provided that there is no diminution of benefits.
f. Transfer of employees
Employees are transferred to another branch or outlet of the same employer.
g. Reassignment of employees
Employees are assigned to another function or position in the same or other branch or outlet of the same employer.
h. Partial closure of establishment
Some units or departments of the establishment are continued while other units or departments are closed.
The DOLE recognizes that this list is not limited and the company may adopt other feasible work arrangements considering the specific peculiarities of different business requirements.
3. How are Flexible Work Arrangements implemented?
These arrangements must be voluntary on the part of the employees.
The employer must also report the adoption of any flexible working arrangement or alternative work scheme to the proper DOLE Office having jurisdiction over the workplace.
Compressed Work Weeks
1. What is a compressed work week (CWW)?
A CWW scheme is an alternative arrangement whereby the normal workweek is reduced to less than six (6) days but the total number of normal work hours shall remain at forty-eighty (48) hours. The normal workday is increased to more than eight hours without the corresponding overtime premium.
This concept can be adjusted accordingly in cases where the normal workweek is five (5) days (i.e. the workweek is reduced to less than five (5) days but the total number of normal work hours shall remain at forty (40) hours).
Under a CWW scheme, work beyond eight (8) hours will not be compensable with overtime premium pay, provided that the total number of work hours per day shall not exceed twelve (12) hours.
2. What are the requirements of a CWW scheme?
a. The CWW scheme is undertaken as a result of an express and voluntary agreement of majority of the covered employees or their duly authorized representatives.
b. The employer shall notify the proper DOLE office having jurisdiction over the workplace of the adoption of the CWW scheme.
c. There must be a certification from an accredited health and safety organization or from the employer’s safety committee that work beyond eight hours is within threshold limits or tolerable levels of exposure, as set in the OSHS in the following instances:
Firms using substances, chemicals and processes which may pose hazards to the employees’ health and safety.
Firms operating under conditions where there are substances or noise which may pose hazards to the employees’ health and safety.
3. When is overtime work compensable?
Under a CWW scheme, work performed beyond twelve (12) hours a day or forty-eight (48) hours a week shall be subject to overtime premium.
If the normal work week is five (5) days, work rendered beyond forty (40) hours a week shall be subject to overtime premium.
4. Can the employer revert back to a normal work week?
Yes, the DOLE recognizes that such reversion is a legitimate exercise of management prerogative and does not constitute a diminution of benefits. The employer, however, is required to give the affected employees prior notice of reversion within a reasonable time.
Telecommuting
What are the requirements of a telecommuting arrangement?
Telecommuting, as a flexible working arrangement, is likewise encouraged by the DOLE subject to compliance with the requirements stated in Department Order 202-19.
Under this DO, a telecommuting program may be offered to employees on a voluntary basis and upon such terms and conditions as mutually agreed upon. This agreement must be in writing.
The terms and conditions shall not be less than the minimum standards set by law. However, pursuant to Section 5 of Labor Advisory 17-20, the parties may voluntary agree to adjust wage and other wage-related benefits.
Lastly, the employer is required to report to the proper DOLE Field Office having jurisdiction over the place of employment its adoption of a telecommuting program.
Agreement to Reduce Wages and Other Benefits
1. Is it possible to effect a paycut or other reduction of benefits for employees?
Under Labor Advisory 17-20, employers and employees may agree voluntarily and in writing to temporarily adjust employees’ wages and wage-related benefits as provided for in an existing employment contract, company policy, or collective bargaining agreement (CBA).
2. Are arrangements of this kind permanent?
These adjustments are temporary in nature and should not exceed six (6) months. However, the agreement may be renewed after this period.
3. Will these arrangements violate the rule against non-diminution of benefits?
No, the restriction on diminution of benefits covers those diminutions or discontinuances done unilaterally by the employer.
Adjustments pursuant to this Labor Advisory are voluntary on the part of both the employer and the employees. Furthermore, these arrangements are only temporary in nature.
Computation of the Probationary Period of Employment
How will the period under the quarantine period be counted in the computation of the probationary period of employment?
Labor Advisory 14-A-20 provides that the period covered during which the enhanced or general community quarantine is enforced where the establishment has temporarily ceased or closed operations and/or the worker was temporarily not required to report for work on account thereof is not included in the six (6) month probationary period.
Deferment of Holiday Pay
Can we put off payment of the holiday premium pay?
Employees are still entitled to the proper holiday premium pay for regular holidays. However, Labor Advisories 13-A, 20, and 22-2020 clarified that the payment of this premium pay for the following holidays may be deferred until such a time that the present emergency situation has been abated and the normal operations of the establishment is in place:
April 9, 2020 (Araw ng Kagitingan and Maundy Thursday)
April 10, 2020 (Good Friday)
April 11, 2020 (Black Saturday)
May 25, 2020 (Eid’l Fitr)
June 12, 2020 (Independence Day)
Please note, however, that establishments which are closed during these holidays are exempt from paying holiday premium.
Temporary Closure of Business
1.Can businesses temporarily close shop?
Article 301 (formerly 286) of the Labor Code allows the temporary bona-fide suspension of the operations of a business or undertaking for a period not exceeding six (6) months.
Consequently, affected employees will be temporarily displaced. After this maximum period of six (6) months, however, the employer must recall the displaced employees or dismiss them properly. Otherwise, they will be deemed constructively dismissed and will be entitled to the corresponding payment of full backwages and separation pay.
The paramount consideration in determining the validity of the suspension of business operation is the dire exigency of the circumstances. This will be evaluated on a case-to-case basis.
2. What is the process for undertaking temporary suspension of business operations?
The employer must first notify the proper DOLE Office having jurisdiction over the workplace thirty (30) days prior to the implementation of the temporary closure. Concurrent notice to the employees must likewise be sent within the same thirty (30) days.
Should you have any questions on how to implement any of these arrangements in your workplace, you may contact us here.
The Law Office of Flores and Ofrin remains open to service its clients. However, we have implemented protocols to prevent the spread of COVID-19 as follows:
No face-to-face meetings will be accepted for the time being. Our lawyers are available for consultation through phone or email.
We will accept video conference/teleconference meetings through an agreed upon channel from 8:00 a.m. to 5:00 p.m.
Any matter that requires liaison with government agencies will be accommodated, as long as such government agencies remain open.