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Hotel, restaurant employees get 100% of service charge with new law

MANILA, Philippines – Rank-and-file employees of hotels and restaurants are now entitled to receive service charge "in full" instead of just getting 85% of the collection, thanks to a new law.

President Rodrigo Duterte signed an amendment to the Labor Code on August 7, thus creating Republic Act No. 11360 or the service charge law, said Senator Joel Villanueva in a statement on Tuesday, August 13.

Villanueva distributed a copy of the signed law to media.

Here's a copy of the law:

Service Charges " src=" https://www.scribd.com/embeds/421791307/content?start_page=1&view_mode=scroll&show_recommendations=false&access_key=key-Own5U9LcE76bFIUhLrfD " data-auto-height="true" data-aspect-ratio="1. 4135254988913526" scrolling="no" width="100%" height="600" frameborder="0">

The new measure amends Article 96 of the Labor Code to read: "All service charges collected by hotels, restaurants, and similar establishments shall be distributed completely and equally among the covered workers except managerial employees."

Managerial employees, it says, refers to any person "with powers or prerogatives to lay down and execute management policies or hire, transfer, suspend, lay off, recall, discharge, assign or discipline employees or to effectively recommend such managerial actions."

The labor secretary is tasked with issuing the law's implementing rules and regulations within 60 days from its effectivity, "in consultation with relevant stakeholders."

Before the amendment, the Labor Code said rank-and-file employees were entitled to only 85% of service charge paid by customers of hotels, restaurants, and similar establishments.

The remaining 15% was kept by management to pay for losses and damage and was distributed to managerial employees.

"The law allows our frontline service workers to enjoy the fruits of their labor, the reward for providing good, quality service," said Villanueva.

Villanueva is the same lawmaker who championed the security of tenure bill or anti-endo bill which Duterte vetoed last July, to Villanueva's great disappointment.

The senator refiled the same exact bill days later. – Rappler.com

Pia Ranada

Pia Ranada covers the Office of the President and Bangsamoro regional issues for Rappler. While helping out with desk duties, she also watches the environment sector and the local government of Quezon City. For tips or story suggestions, you can reach her at pia.ranada@rappler.com.

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