House panel OKs bill protecting, giving incentives to freelancers

Published January 25, 2021, 12:22 PM

by Charissa Luci-Atienza 

The House Committee on Ways and Means approved Monday an unnumbered substitute bill seeking to provide protection and incentives to country’s 1.5 million freelancers.


In a virtual meeting, the House panel, chaired by Albay Rep. Joey Salceda, approved the taxation provision of the proposed Freelancers Protection Act.

PBA partylist Rep. Jericho Nograles moved for the approval of the committee report on the substitute bill. His motion was seconded by Nueva Ecija Rep. Estrellita Suansing.

The panel specifically approved Sections 18, 19, and 20 of the substitute measure, which is a consolidation of six bills.

Section 18 of the proposed Freelancers Protection Act provides that that all freelancers shall register with the Bureau of Internal Revenue (BIR).

Under the unnumbered substitute bill, a freelancer is referred to any natural person or entity composed of no more than one natural person, whether incorporated under the Securities and Exchange Commission, registered as a sole proprietorship under the Department of Trade and Industry (DTI) or registered as self-employed with the BIR, that is hired or retained as an independent contractor to do work according to one’s own methods and without being subjected to the control of the hiring party, except only as to the results of the work, and is hired to provide services in exchange for compensation.

The Salceda panel also passed Section 19 of the bill, which states that except as otherwise provided by law, all freelancers shall pay their income taxes annually.

Section 20 also got the nod of the Salceda panel. It provides that every BIR Revenue District Office shall have a lane or a special assistance desk dedicated to freelancers.

“This lane shall have an officer who shall assist freelancers in their application, registration, processing of documents, and other inquiries,” the bill provides.

In his sponsorship speech, Pangasinan Rep. Christopher de Venecia, one of the principal authors of the bill, asked his colleagues to pass the measure, which seeks to benefit 1.2 million to 1.5 million freelancers in the country.

The chairperson of the House Committee on Creative Industry and Performing Arts said the bill seeks to recognize the right of freelancers to be protected from late or non-payment of fees for services rendered.

Last week, the House Committee on Labor and Employment approved the substitute measure and referred it to the Salceda panel for its deliberation and approval.

The substitute bill mandates any hiring party retaining the services of a freelancer to execute a written contract with such freelancer before such services are rendered.

The hiring party and the freelancer shall each retain a copy of the contract and the contract shall be written in plain language and in one understood by both parties, it said.

The bill provides that freelancers who are required to be physically present in the workplace or those on field assignments shall be paid a night shift differential of not less than 10 percent of one’s regular compensation for each hour of work performed between 10 p.m. and 6 a.m., unless there is a more favorable fee stipulated in the contract.

Under the measure, all freelancers deployed in dangerous areas such as strife-torn or embattled locations, distressed or isolated stations, prison camps, mental hospitals, radiation-exposed clinics, laboratories or disease-infested areas, or in areas declared under state of calamity or emergency for the duration of deployment which expose them to great danger, contagion, radiation, occupational risks, or perils to life, shall be compensated with a hazard pay equivalent to at least 25 percent of the total payment for the period of such deployment as agreed upon in the contract, unless there is a more favorable fee stipulated in the contract.

The bill provides that it shall be unlawful for any hiring party to:

– Pay the compensation due the freelancer later than 15 days after the date of payment of compensation stated in the written contract or after the rendition of services in cases where there is no written contract;
– Require as a condition of payment of compensation, at any time after a freelancer has commenced rendition of services, that a freelancer accept less than the specified contract price; and
– Commit any act of retaliation against any freelancer for opposing any practice prohibited by this Act, filing a complaint authorized under this Act, among others.

The measure tasks the Department of Labor and Employment (DoLE), in coordination with the Department of Trade and Industry (DTI), BIR, local government units (LGUs), and other relevant agencies, to initiate a program with the objective of informing freelancers of the rights and obligations contained in the proposed Act, the proper procedure of registering as a taxpayer, and their modes of legal redress in this Act and in other laws and regulations.