2 Senate bills set protection for growing freelance industry

House Bill No. 6718 defines a freelance worker as 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 or registered as self-employed with the Bureau of Internal Revenue. (Pexels photo)

MANILA – With the fast-growing market for freelancers, two bills protecting them from abuses and exploitations have been filed in the Senate.

Senator Lito Lapid filed Senate Bill (SB) No. 1998 or an act providing protection and incentives to freelance workers, citing about 1.7 million to 2 million of the latest data.

“Many Filipino freelance workers take jobs from both local and overseas clients. They prefer not being tied to just one particular company. This is not only due to the job flexibility, freedom from a fixed employer, and workload control they enjoy, but also due to the greater earning potential from multiple income streams,” Lapid said in his explanatory note.

The bill also provides protection against non-payment, lack of benefits, and the frequent practice of a party departing without notice at the expense of the freelancer.

Under SB 1998, an initial partial payment shall be made upon engagement for the contracting of services of the freelance worker.

Night shift differential, tax relief and hazard pay shall also be provided.

A grievance redress mechanism is available under the bill for any unlawful practice or act.

Similarly, Senator JV Ejercito filed SB 2006 or the Freelance Workers Protection Act that requires a physical contract between the employer and the freelancer, covering services to be provided by the worker.

The contract must contain the 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 (DOLE).

Ejercito said an initial payment of not less than 30 percent of the contract price shall be made upon agreement.

“It also calls for a civil penalty of PHP50,000 to PHP500,000 for unlawful practices which include engaging with a freelance worker without a written contract; paying the compensation due to the 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,” Ejercito said in his explanatory note.

On Feb. 5, the House of Representatives overwhelmingly approved their version of the bills.

House Bill No. 6718 defines a freelance worker as 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 or registered as self-employed with the Bureau of Internal Revenue.

The House bill includes the provisions of the Senate versions and tax relief within the threshold specified under Republic Act No. 10963 (Tax Reform for Acceleration and Inclusion Act) and Republic Act No. 9178 (Barangay Micro Business Enterprises Act).