House panel approves bill protecting employees from company mergers

The House of Representatives Committee on Labor and Employment, under its chairman Rep. Enrico Pineda of 1-Pacman Partylist, approved on Wednesday, Oct. 20 the bill protecting the rights of employees affected by mergers, consolidations or sales of businesses.

The Lower House committee deliberated on the draft committee report on the substitute bill to House Bill No. 2633 entitled, “An Act Protecting Employees in Cases of Merger or Consolidation, Sale or Transfer of All or Substantial Assets or Businesses of their Employers and for Other Purposes”.

HB 2633, filed by TUCP Partylist Rep. Raymond Democrito Mendoza, was unanimously approved by members of the panel present.

The said measure seeks to protect employees in cases of merger or consolidation, sale or transfer of all or substantial assets or businesses of their employers.

Mendoza in his explanatory note said that the bill seeks to oblige the acquiring or transferee employers to continue the employment of the transferor employer's employees during such instances. It likewise mandates that merger, consolidation or transfer of business shall not diminish the wages, benefits and other employment terms and conditions of the affected employees.

The bill also aims to limit the ground for termination of employment in case of such business overhauls only to redundancy. It sets a presumption that if the transferee employer of a new company becomes a bigger entity than the prior one, there can be no declaration of redundancy as the business can absorb the employees.

It also sets out rules on recognition of existing bargaining agents and agreements which will not only protect the unions, but also the benefits they have worked hard for as embodied in the Collective Bargaining Agreements. (Melvin Sarangay)