Salceda commends passage of HB 6718

LEGAZPI CITY: Albay Second District Rep. Jose Ma. Clemente “Joey” Salceda lauded the House of Representatives for the passage of the Freelance Workers Protection Act (HB 6718) on third reading.

Salceda, principal author of HB 6718 who chairs the House Ways and Means Committee, said the over 1.5 million freelance workers in the country will now be protected and provided ample legal and contractual protection.

“The measure seeks to require a written contract between the employer and the freelance worker that shall state the terms and conditions of employment, including services to be provided by the freelance worker, details of compensation and benefits, employment period, grounds for breach of contract, and other conditions as may be directed by the Department of Labor and Employment, among others,” the lawmaker from Albay said.

Salceda said that the consolidated version of HB 6718 aims to promote the safety and well-being of freelance workers, specifically by mandating the provision of hazard pay and night shift differential pay.

Salceda added that the Labor Code has no definition for freelancing and provides no formal contractual framework for Filipinos working under this category.

“If this law is enacted, freelancers will have contractual protections and tax amnesty for their own sector to help them register legally,” Salceda said.

HB 6718 defines a freelance worker as any person working for a firm, whether incorporated under the Securities and Exchange Commission or registered as a sole proprietorship under the Department of Trade and Industry, or as self-employed registered with the Bureau of Internal Revenue (BIR), and hired or retained to provide services in exchange for compensation, 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 for the results of his work.

Under the measure, any hiring party obtaining or retaining the services of a freelance worker shall execute a written contract with such freelance worker before services are rendered.

“The hiring party and the freelance worker shall each retain a signed copy of the contract, written in plain language and understood by both parties. It will itemize the services to be rendered; the details of compensation and other benefits; the period of employment; the grounds for breach of contract; the TIN; and any condition, term or clause the DoLE may direct,” the bill stated.

Under HB 6718, 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.

While freelance workers deployed in dangerous areas such as strife torn or embattled locations, distressed or isolated stations, areas under state of calamities or emergencies, contagions, radiations and the likes will also be granted hazard pay equivalent to not less than 25 percent of the total payment stated in the contract.

The bill also provides a civil penalty of P50,000 to P500,000 for unlawful practices which include paying the compensation due to freelance worker later than 15 days after the date of payment of compensation stated in the written contract; or requiring as a condition of payment of compensation that a freelance worker accepts less than the specified contract price.

The BIR is also mandated to designate a special lane or assistance desk to assist freelancers on their inquiries and in complying with the processing of documents, including the registration requirement under the bill.

The measure was passed unanimously by the Lower House in the 18th Congress in March 2021, but failed to be enacted.

On Monday, the House of Representatives approved HB 6718 on third and final reading.