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Labor justice in the Philippines is embedded both in Presidential Decree No. 442 or the Labor Code of the Philippines and the 1987 Philippine Constitution. Article XIII, Section 3 of the Constitution stipulated the role of the State in protecting the workers with their fundamental rights at work. Meanwhile, Article 128 of the Labor Code of the Philippines, as amended, underscores the visitorial and enforcement power of the Secretary of Labor and Employment and his/her duly authorized representative. Moreover, Article 129 of the said Code of the Philippines provided the Secretary of Labor and Employment or his/her duly authorized hearing officer with the power to hear and decide any matter involving the recovery of wages and other monetary claims.

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The Institute for Labor Studies, as the policy and research arm of the Department of Labor and Employment, is mandated to review the rationale of existing legislation and regulations, including the costs involved in implementation and the benefits derived. The inevitable changes in the labor and employment sector through the years have given rise to the need to address emerging issues and consequences arising from policies and practices. Consequently, this study on Department Order No. 174, series of 2017, assessed the regulatory impact of the said contracting and subcontracting regulation by analyzing the experiences and insights of stakeholders, particularly on the DO’s legal, administrative, and operational aspects. These insights were analyzed and formulated into policy options, and ways forward that the Department may follow in its review. The research adopted a mixed-method approach as an initial step for regulatory impact assessment. Primary and secondary data were collected and analyzed through desk review, key informant interviews, focus group discussions, and a survey. Throughout the study, it was found that the majority of the stakeholders find DO 174-17 sufficient in achieving its purpose of regulating contracting and subcontracting arrangements but needs refinement to improve the efficiency of the processes and procedures involved. Strengthening the implementation of the DO can be achieved by harmonizing or clarifying vague provisions of the regulation. Consequently, the researchers recommend two (2) policy options to either: 1) adopt DO 174-17 but develop a uniform streamlined process flow; or 2) revise the current regulation entirely.

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Businesses that give employers and employees a place to meet are known as Labor Market Intermediaries (LMIs), and they play a critical role in facilitating transactions and creating networks. Digital LMIs (DLMIs) are LMIs that operate purely on a digital platform; this denotes that employer-employee matching in the labor market has transformed to meet the demands posed by 21st-century innovations and technologies (Autor 2001). In the Philippines, DLMIs have become a popular avenue for advertising employment opportunities and searching for job vacancies. Due to the presence of DLMIs in the Philippines and their profound impact on the labor market, the current policies on recruitment and placement fall short of covering DLMIs due to the ambiguity in applying Article 13, Section B of the Labor Code of the Philippines (LCP) to digital platforms.