By Leonel Abasola
Senator Joel Villanueva has asked the Department of Labor and Employment (DOLE) to clarify their implementing rules and regulations (IRR) on the Service Charge Law particularly with regard to contractual workers in the hospitality industry.
The lawmaker said DOLE must establish a clear mechanism on how service workers hired for special events or banquets to augment existing staff can receive a share of the service charge paid to establishments.
Villanueva, principal author and sponsor of Republic Act No. 11360 or the Service Charge Law, said that contractual workers should be included in the distribution of the service charge collected by hotels, restaurants, resorts, and similar establishments in the hospitality industry as agreed upon by lawmakers during the law’s deliberation in the bicameral conference committee.
“During the bicameral conference committee, since we intended that contractual workers will also be included, we expected DOLE to also fix the period of payment or at least provide some guidelines on how contractual workers will be paid.
“Unfortunately, since DOLE did not include contractual workers in the coverage, this issue was also not clarified under the IRR recently issued by DOLE,” Villanueva, chair of the Senate Committee on Labor, Employment, and Human Resources Development, said in a statement.
Pointing out that all workers who rendered actual service should be included in the distribution of the service charge, Villanueva said that even contractual workers hired to assist a banquet service should be given their fair share of the service charge collected from the event.
He also explained the distinction between top-level managers and supervisory or first-level managers, the latter of which should still be entitled to receive a portion of the service charge.
Citing the law’s provision defining the term ‘managerial employee’, individuals excluded from the distribution of the service charge are employees “who lay down and execute management policies, or hire, transfer, suspend, lay-off, recall, discharge, assign, or discipline employees, or effectively recommend such managerial actions,” Villanueva said.
“Top-level managers are essentially the management’s representative and they directly interact with the owners. They have access to them and the bargaining power to negotiate for their respective remuneration, unlike supervisory managers or first-level managers,” Villanueva added.