Rules on employee cash bond – Labor Law Compliance

See - Rules on employee cash bond – Labor Law Compliance
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Rules on employee cash bond
10 August 2016
Work Conditions
“Articles 113 and 114 of the Labor Code are clear as to what are the exceptions to the general prohibition against requiring deposits and effecting deductions from the employees’ salaries. Hence, a statutory construction of the aforecited provisions is not called for. Even if we were however called upon to interpret the provisions, our inclination would still be to strictly construe the same against the employer because evidently, the posting of cash bonds and the making of deductions from the wages would inarguably impose an additional burden upon the employees.

“While the petitioners are not absolutely precluded from imposing the new policy, they can only do so upon compliance with the requirements of the law. In other words, the petitioners should first establish that the making of deductions from the salaries is authorized by law, or regulations issued by the Secretary of Labor. Further, the posting of cash bonds should be proven as a recognized practice in the jewelry manufacturing business, or alternatively, the petitioners should seek for the determination by the Secretary of Labor through the issuance of appropriate rules and regulations that the policy the former seeks to implement is necessary or desirable in the conduct of business… It bears stressing that without proofs that requiring deposits and effecting deductions are recognized practices, or without securing the Secretary of Labor’s determination of the necessity or desirability of the same, the imposition of new policies relative to deductions and deposits can be made subject to abuse by the employers. This is not what the law intends.”

– NIA Jewelry Manufacturing of Metal Arts, Inc. v. Montecillo, G.R. No. 188169, 28 November 2011
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