Last November 2019, the Implementing Rules and Regulations of Republic Act 11360 or the Service Charge Law was signed, mandating that the service charges collected by hotels and similar establishments shall be distributed in full to all covered employees. With the new law, establishments which previously allotted 15% or a portion of the service charges collected to losses or breakages and given managerial employees will no longer be required.
In turn, the management will shoulder all costs on losses and breakages and may result to a further increase in management cost. In addition, managerial employees will no longer receive the 15% distributed among them. The integration of RA 11360 could also possibly affect wages and benefits such as 13th month pays, leave benefits, and retirement benefits among others. With the new changes posed by the Service Charge Law, it is crucial for businesses to familiarize itself with the implications and rules to comply with the new law.
This meeting by the Amcham Philippines Human Capital and Resources Committee aims to present R.A 11360 through a discussion among public sector representatives, human resource executives, business leaders, and other key stakeholders on the current status, challenges, and implications of the new law. Furthermore, it will support and empower the human capital and labor industry in the Philippines through becoming an avenue that would push forward effective policies and initiatives.