An Act Providing that Service Charges be Distributed in Full

Case Overview and Summary

Summary of Republic Act No. 11360

Service Charges Distribution in Hotels, Restaurants and Similar Establishments
- All service charges collected by hotels, restaurants and similar establishments shall be distributed completely and equally among the covered workers except managerial employees. (Section 1)
- Covered workers' service charges shall not be considered in determining the employer's compliance with increased minimum wage. (Section 1)
- A grievance mechanism shall be established to resolve disputes between management and employees on the distribution of service charges. If no grievance mechanism is established or if inadequate, the grievance shall be referred to the regional office of the Department of Labor and Employment which has jurisdiction over the workplace for conciliation. (Section 1)
- Managerial employees are defined as any person vested 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. (Section 1)
- The Act shall not diminish existing benefits under present laws, company policies, and collective bargaining agreements. (Section 2)
- The Secretary of Labor and Employment shall issue the appropriate implementing rules and regulations of this Act within sixty (60) days from its effectivity, in consultation with relevant stakeholders. (Section 3)
- All laws, presidential decrees, proclamations, executive orders, issuances, rules and regulations or parts thereof inconsistent with the provisions of this Act are hereby repealed, amended or modified accordingly. (Section 4)
- The Act shall take effect fifteen (15) days after its publication in the Official Gazette or in at least two (2) national newspapers of general circulation. (Section 5)