DOLE to Release IRR of Service Charge Law Within 90 Days
DOLE to Release IRR

DOLE to Release IRR of Service Charge Law Within 90 Days

Labor Secretary Silvestre Bello III of the Department of Labor and Employment (DOLE) announced the agency’s intent to release the Implementing Rules and Regulations (IRR) of Republic Act 11360, or the “Service Charge Law,” within the next three months. The law grants the equal distribution of 100% of the restaurant service charges collected by service industry workers of hotels, restaurants, and similar establishments (HRSEs).

The Service Charge Law was signed by President Rodrigo Duterte last August 7. It directly amends Article 96 of the Labor Code, which declared that only 85% of the collected service charges be distributed to the employees, while 15% went to the management. 

The new law officially mandates HRSEs to completely and equally distribute all service charges received to all of their rank-and-file and supervisory employees, except managerial employees.

“The law will keep our workers in the hotel and restaurants motivated in providing quality services, as well as a chance to give them a simple reward for their hard work,” Secretary Bello said in a statement on Monday, August 19.

In the statement, Secretary Bello III guaranteed the fast track drafting of the IRR and its projected release by DOLE within the 90 days.

“We have 90 days to craft the IRR, but we don’t intend to maximize it. Instead, we hope to come up with it as soon as possible so our workers in hotels and restaurants can finally receive reasonable incentives from their hard work and quality services,” Secretary Bello added.

The law also enforces the development of an internal grievance mechanism to allow for the resolution of any dispute between employees and the management on the distribution of the service charge within the industry.

Workers can officially and adequately secure their fair share of the full collected service charges 15 days after the publication of the law’s IRR in a newspaper of general circulation in the country.

In response to the signing of the Service Charge Law, a group of local hotel and restaurant workers has expressed appreciation on how the new regulation “will raise the take-home pay of workers of HRSEs that collect service charges.”

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