Employee Handbook in the Philippines: Required Policies, Company Rules and Due Process

Short answer: No Philippine law requires a document called an "employee handbook." But laws and DOLE rules require specific written policies, such as anti-sexual harassment rules, an occupational safety and health (OSH) program covering drugs, HIV, tuberculosis and hepatitis, and a mental health policy. A handbook keeps these and your company rules in one place, and signed acknowledgments prove employees received them. Its rules support discipline only if they are lawful, reasonable, made known and fairly applied, and none can replace the due process required before dismissal.

Is a handbook required by law?

No. The requirements are spread across statutes and DOLE issuances, and a handbook simply gathers them. It also proves that your rules existed and reached employees. When an airline adopted a new code of discipline without consulting its employees' union, the Supreme Court upheld an order to discuss the code with the union and give every employee a copy, recognizing workers' right to take part in policies that affect their rights (Philippine Airlines, Inc. v. National Labor Relations Commission, G.R. No. 85985, August 13, 1993).

Policies the law requires

• Sexual harassment. Adopt rules on investigation and penalties, jointly approved by employees; form a committee on decorum and investigation (CODI) with management, union (if any), supervisory and rank-and-file members; and post the law (Section 4, Republic Act No. 7877). The Safe Spaces Act adds a code of conduct, prepared with workers, setting out the ban, the complaint procedure and penalties. The CODI must be headed by a woman, be at least half women and decide complaints within 10 days (Section 17, Republic Act No. 11313). Harassment between peers, by subordinates and online is covered (Section 16). An employer that does not act immediately on a complaint can share liability for damages (Section 5, Republic Act No. 7877).

• OSH program. Covered workplaces need a safety and health program, prepared with workers and submitted to DOLE, that includes a drug-free workplace policy, HIV/AIDS, tuberculosis and hepatitis prevention and control, and prohibited acts and penalties (Section 12, Republic Act No. 11058). The current implementing rules, DOLE Department Order No. 252, s. 2025, took effect on May 16, 2025, replacing Department Order No. 198, s. 2018. Willful violations can cost up to ₱100,000 a day (Section 28).

• Drug-free workplace. Establishments with 10 or more workers need a drug-free program within the OSH program, with random tests paid for by the employer, done at DOH-accredited centers and kept confidential (Republic Act No. 9165; DOLE Department Order No. 53-03).

• HIV, tuberculosis and hepatitis B. All private workplaces need a policy on each that bars discrimination (DOLE Department Order No. 102-10; DOLE Department Order No. 73-05; DOLE Department Advisory No. 05). HIV testing cannot be a condition of employment, HIV status is confidential, and HIV-based discrimination at work is prohibited (Sections 3(g), 30, 44 and 49(a), Republic Act No. 11166). Hepatitis B screening cannot be a hiring requirement.

• Mental health. Employers must have mental health policies and programs (Section 25, Republic Act No. 11036), prepared with workers' representatives, built into the OSH program and handled confidentially (DOLE Department Order No. 208, s. 2020).

• Violence and harassment. DOLE Department Order No. 259, s. 2026, issued July 31, 2026, asks every private establishment, whatever its size, to adopt a policy against physical, psychological, economic and sexual violence and harassment, stand-alone or in the collective bargaining agreement (CBA), with a complaint procedure, a ban on retaliation and a yearly report to DOLE by January 30. It covers commuting, work trips, company events and work chats. Some commentators read it as encouraged rather than compulsory; following it is safer.

• Telecommuting, if offered. It is voluntary, but telecommuters must be treated like comparable on-site employees (Republic Act No. 11165; DOLE Department Order No. 237, s. 2022).

Leave rules to state correctly

• Service incentive leave: five paid days a year after one year of service, with exemptions such as establishments regularly employing fewer than 10 workers (Article 95, Labor Code).

• Maternity leave: 105 days with full pay, plus 15 days for qualified solo mothers (Republic Act No. 11210).

• Paternity leave: 7 days with full pay for married male employees, for the first four deliveries of the legitimate spouse they live with (Republic Act No. 8187).

• Solo parent leave: up to 7 paid working days a year after six months of service (Republic Act No. 11861).

What makes a company rule valid

Management prerogative, the employer's right to regulate all aspects of work, including discipline, is upheld when exercised in good faith and not to defeat employees' rights under the law or valid agreements (San Miguel Brewery Sales Force Union (PTGWO) v. Ople, G.R. No. L-53515, February 8, 1989). For willful disobedience, a just cause for dismissal, the order or rule broken must be reasonable, lawful, made known to the employee and related to the employee's duties (Lores Realty Enterprises, Inc. v. Pacia, G.R. No. 171189, March 9, 2011).

• Have a business reason. A rule requiring one of two employees who marry each other to resign was struck down because the employer could not prove a reasonable business necessity (Star Paper Corporation v. Simbol, G.R. No. 164774, April 12, 2006).

• Follow your own procedures. An employer that skipped steps in its own evaluation procedure paid ₱30,000 in nominal damages, a token award for a violated right, though the termination was valid (Abbott Laboratories, Philippines v. Alcaraz, G.R. No. 192571, July 23, 2013).

• Label benefits carefully. Under the non-diminution rule, benefits based on an express policy, a written contract or a long, consistent and deliberate practice cannot be withdrawn unilaterally (Article 100, Labor Code; Wesleyan University-Philippines v. Wesleyan University-Philippines Faculty and Staff Association, G.R. No. 181806, March 12, 2014). Mark discretionary benefits as such.

Discipline and due process

Tie your offenses to the legal grounds:

• Just causes (the employee's fault): serious misconduct or willful disobedience, gross and habitual neglect of duties, fraud or willful breach of trust, a crime against the employer, the employer's family or representative, and analogous causes (Article 297, formerly Article 282, Labor Code).

• Authorized causes (business or health reasons): labor-saving devices, redundancy, retrenchment to prevent losses and closure (Article 298), and disease (Article 299). These need written notice to the employee and DOLE at least 30 days ahead (Section 5.3, DOLE Department Order No. 147-15).

For just causes (Section 5.1, DOLE Department Order No. 147-15):

1. First written notice: the specific ground, the detailed facts and the rule broken, with at least five calendar days to answer (King of Kings Transport, Inc. v. Mamac, G.R. No. 166208, June 29, 2007).

2. Chance to be heard: written or verbal. A formal hearing or conference is required only if the employee asks in writing, the facts are seriously disputed, a company rule or practice requires it, or similar circumstances exist (Perez v. Philippine Telegraph and Telephone Company, G.R. No. 152048, April 7, 2009). If your handbook promises a hearing, hold one.

3. Second written notice: the decision, stating that all circumstances were considered and the grounds were proved.

Skipping these steps does not void a dismissal for just cause, but it costs nominal damages, set at ₱30,000 in Agabon v. National Labor Relations Commission, G.R. No. 158693, November 17, 2004. See also: Due process in employee dismissal.

Monitoring and employee data

Tell employees, in the handbook or a privacy notice, what personal data you collect and monitor (such as email, devices and CCTV), why, and for how long. Processing must be transparent, for a legitimate purpose and proportionate (Section 11, Republic Act No. 10173). It needs a lawful basis, such as the employment contract, a legal obligation or legitimate interests (Section 12), and employees have the right to be informed (Section 16).

For CCTV, post visible notices, keep cameras out of toilets, fitting rooms and lactation rooms, and keep footage only as long as needed (NPC Circular No. 2024-02). More: Can employers monitor employees?

Practical checklist

1. Get acknowledgments for the handbook and each update, on paper or electronically. The drug-free workplace rules require written acknowledgment (DOLE Department Order No. 53-03).

2. Use a language employees understand. Where a party cannot read a contract or understand its language and alleges mistake or fraud, the enforcing party must prove it was fully explained (Article 1332, Civil Code).

3. Consult where the law requires it. Sexual harassment rules, the code of conduct, the OSH program and most of the health policies above must be prepared with employees or their representatives.

4. Check the CBA. A handbook cannot override a valid CBA, and several DOLE issuances call for these policies to be written into it.

5. Review yearly, and re-issue when the law changes.

Frequently asked questions

What workplace policies does DOLE require?

The OSH program; policies on drugs, HIV and AIDS, tuberculosis, hepatitis B and mental health; and the sexual harassment rules, committee and code of conduct (Republic Acts No. 7877 and 11313).

Do small businesses need these policies?

Mostly, yes. The sexual harassment duties apply to all employers, and the HIV, TB and hepatitis B policies to all private workplaces. The drug-free program applies at 10 or more workers, and OSH requirements scale with size and risk.

Can we change the handbook?

Yes, if the change is lawful, reasonable and made known. But benefits protected by the non-diminution rule cannot be withdrawn, and policies prepared with employees should be revised with them.

Sources

• Labor Code, Articles 95, 100, 297, 298 and 299

• Civil Code, Article 1332

• Republic Act No. 7877, Sections 4 and 5

• Republic Act No. 11313, Sections 16 and 17

• Republic Act No. 11058, Sections 12 and 28; DOLE Department Order No. 252, s. 2025

• Republic Act No. 9165; DOLE Department Order No. 53-03

• Republic Act No. 11166, Sections 3(g), 30, 44 and 49(a); DOLE Department Order No. 102-10

• DOLE Department Order No. 73-05; DOLE Department Advisory No. 05 (hepatitis B)

• Republic Act No. 11036, Section 25; DOLE Department Order No. 208, s. 2020

• DOLE Department Order No. 259, s. 2026

• Republic Act No. 11165; DOLE Department Order No. 237, s. 2022

• Republic Act No. 11210; Republic Act No. 8187; Republic Act No. 11861

• Republic Act No. 10173, Sections 11, 12 and 16; NPC Circular No. 2024-02

• DOLE Department Order No. 147-15, Sections 5.1 and 5.3

• San Miguel Brewery Sales Force Union (PTGWO) v. Ople, G.R. No. L-53515, February 8, 1989

• Philippine Airlines, Inc. v. National Labor Relations Commission, G.R. No. 85985, August 13, 1993

• Agabon v. National Labor Relations Commission, G.R. No. 158693, November 17, 2004

• Star Paper Corporation v. Simbol, G.R. No. 164774, April 12, 2006

• King of Kings Transport, Inc. v. Mamac, G.R. No. 166208, June 29, 2007

• Perez v. Philippine Telegraph and Telephone Company, G.R. No. 152048, April 7, 2009

• Lores Realty Enterprises, Inc. v. Pacia, G.R. No. 171189, March 9, 2011

• Abbott Laboratories, Philippines v. Alcaraz, G.R. No. 192571, July 23, 2013

• Wesleyan University-Philippines v. Wesleyan University-Philippines Faculty and Staff Association, G.R. No. 181806, March 12, 2014

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This article is general information as of its publication date, not legal advice, and does not create a lawyer-client relationship. For advice on your situation, consult a lawyer.