Philippine Laws -Simplified | Free Legal Advice

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Facilities and Supplements

Thursday, October 13, 2011

Facilities form part of wages. Under the Rules Implementing the Labor Code,  they "include articles or services for the benefit of the employee or his family but shall not include tools of the trade or articles or service primarily for the benefit of the employer or necessary to the conduct of the employer's business" (Book 3, Rule 7-A, Sec. 5.) They are necessary for the subsistence of the employee and his family; board and lodging are considered facilities. The DOLE secretary can fix the fair and reasonable value of facilities through regulations. They must, however, be voluntarily accepted by the employee or they can't be deducted from his wages.

Supplements, on the other hand, are benefits and privileges constituting extra remuneration over and above the ordinary earnings of the worker.

To determine whether the privilege is a supplement or a facility, you must find out what its purpose is for and not pay attention to the item, privilege or benefit itself.

For facilities to be deducted from wages, the following requirements must be observed:

1.) The employer must prove that the facility was customarily given by the trade
2.) The employee must accept the provision of deductible facilities voluntarily and in writing
3.) The facilities must be charged at their fair and reasonable value

2 comments:

Unknown said...

Which among the two is deductible from wages?

Unknown said...

Facilities are wage-deductible, supplements are not.

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