Republic Act No. 7796 S. NO. 1283 H. NO.

12194 Republic of the Philippines Congress of the Philippines Metro Manila THIRD REGULAR SESSION Begun and held in Metro Manila, on Monday the twenty-fifth day of July, nineteen hundred and ninety four. [Republic Act No. 7796] An act creating the Technical Education and Skills Development Authority, provid ing for its powers, structure and for other purposes be it enacted by the Senate and the House of Representatives of the Philippines in Congress assembled: Section 1. TITLE. - This act shall be known as the "Technical Education Skills D evelopment Act of 1994" or the TESDA Act of 1994." Section 2. DECLARATION OF POLICY. - It is hereby declared the policy of the Stat e to provide relevant, accessible, high quality and efficient technical educatio n and skills development in support of the Development of High Quality Filipino Middle-level Manpower responsive to and in accordance with Philippine Developmen t Goals and Priorities. The state shall encourage active participation of various concerned sectors, par ticularly private enterprises, being direct participants in and immediate benefi ciaries of a trained and skilled workforce, in providing technical education and skills development opportunities. Section 3. STATEMENT OF GOALS AND OBJECTIVES. It is the goal and objective of this act to: Promote and strengthen the quality of technical education and skills development programs to attain international competitiveness; Focus technical education and skills development on meeting the changing demands for quality middle-level manpower; Encourage critical and creative thinking by disseminating the scientific and tec hnical knowledge base of middle-level manpower development programs; Recognize and encourage the complementary roles of public and private institutio ns in technical education and skills development and training systems; and Inculcate desirable values through the development of moral character with empha sis on work ethic, self-reliance and nationalism. Section 4. DEFINITION OF TERMS. - As used in this act: "Skill" shall mean the acquired and practiced ability to carry out a task job; "Skills Development" shall mean the process through which learners and workers a re systematically provided with learning opportunities to acquire or upgrade, or both, their ability, knowledge and behavior pattern required as qualifications for a job or range of jobs in a given occupation areas; "Technical Education" shall refer to the education process designed at post-seco ndary and lower tertiary levels, officially recognized as non-degree programs ai med at preparing technicians, para-professionals and other categories of middlelevel workers by providing them with a broad range of general education, theoret ical, scientific and technological studies, and related job skills training; "Trade" shall mean any group of interrelated jobs or any occupation which is tra ditionally or officially recognized as craft or artisan in nature requiring spec ific qualifications that can be acquired through work experience and/or training ; "Middle-level Manpower" refers to those

1. Who have acquired practical skills and knowledge through formal or non-formal education and training equivalent to at least a secondary education but prefera bly at post-secondary education with a corresponding degree of diploma; or 2. Skilled workers who have become highly competent in their trade or craft as a ttested by industry; "Private Enterprises" Refers to an economic system under which property of all k inds can be privately owned and in which individuals, alone or in association wi th another, can embark on a business activity. This includes industrial, agricul tural, or agro-industrial establishments engaged in the production, manufacturin g, processing, repacking or assembly of goods including service-oriented enterpr ises; "Trainers" shall mean persons who direct the practice of skills towards immediat e improvement in some task; "Trainors/Trainers" shall mean persons who provide training to trainers aimed at developing the latter's capacities for imparting attitudes, knowledge, skills a nd behavior patters required for specific jobs, tasks, occupations or group of r elated occupations. "Trainees" shall mean persons who are participants in a vocational, administrati ve or technical training program for the purpose of acquiring and developing job -related skills; "Apprenticeship" training within employment with compulsory related theoretical instruction involving a contract between an apprentice and an employer on an app roved apprenticeable occupation; "Apprentice" is a person undergoing training for an approved apprenticeable occu pation during an apprenticeship agreement; "Apprenticeship Agreement" is a contract wherein a prospective employer binds hi mself to train the apprentice who in turn accepts the terms of training for a re cognized apprenticeable occupation emphasizing the rights, duties and responsibi lities of each party; "Apprenticeable Occupation" is an occupation officially endorsed by a tripartite body and approved for apprenticeable by the authority; "Learners" refers to persons hired as trainees in semi-skilled and other industr ial occupations which are non-apprenticeable. Learnership programs must be appro ved by the authority; "User-led" or "Market-driven Strategy" refers to a strategy which promotes stren gthened linkages between educational/training institutions and industry to ensur e that appropriate skills and knowledge are provided by the educational system; "Dual System/Training" refers to a delivery system of quality technical and voca tional education which requires training to be carried out alternately in two ve nues: in-school and in the production plant. In-school training provides the tra inee the theoretical foundation, basic training, guidance and human forma tion, while in-plant training develops his skills and proficiency in actual work conditions as it continues to inculcate personal discipline and work values; "Levy Grant System" refers to a legal contribution from participating employers who would be beneficiaries of the program (often as a percentage of the payroll) which is subsequently turned over or rebated to enterprises offering employee t raining programs. Section 5. Technical Education and Skills Development Authority; Creation. - To implement the policy declared in this Act, there is hereby created a Technical E ducation and Skills Development Authority (TESDA), hereinafter referred to as th e Authority, which shall replace and absorb the National Manpower and Youth Coun cil (NMYC), the Bureau of Technical and Vocational Education (BTVE) and the pers onnel and functions pertaining to technical-vocational education in the regional offices of the Department of Education, Culture and Sports (DECS) and the appre nticeship program of the Bureau of Local Employment of the Department of Labor a nd Employment. Section 6. Composition of the Authority.- The Authority shall be composed of the TESDA Board and the TESDA Secretariat.

SEC. 7. Composition of the TESDA Board.* - The TESDA Board shall be composed of the following: The Secretary of Labor and Employment Chairperson Secretary of Education, Culture and Sports Co-Chairperson Secretary of Trade and Industry Co-Chairperson Secretary of Agriculture Member Secretary of Interior and Local Government Member Director-General of the TESDA Secretariat Member In addition, the President of the Philippines shall appoint the following member s from the private sector: two (2) representatives, from the employer/industry o rganization, one of whom shall be a woman; three (3) representatives, from the l abor sector, one of whom shall be a woman; and two (2) representatives of the na tional associations of private technical-vocational education and training insti tutions, one of whom shall be a woman. As soon as all the members of the private sector are appointed, they shall so organized themselves that the term of offic e of one-third (1/3) of their number shall expire every year. The member from th e private sector appointed thereafter to fill vacancies caused by expiration of terms shall hold office for three (3) years. The President of the Philippines may, however, revise the membership of the TESD A Board, whenever the President deems it necessary for the effective performance of the Board's functions through an administrative order. The TESDA Board shall meet at least twice a year, or as frequently as may be dee med necessary by its Chairperson. In the absence of the Chairperson, a Co-Chairp erson shall preside. In case any member of the Board representing the Government cannot attend the meeting, he or she shall be regularly represented by an under secretary or deputy-director general, as the case may be, to be designated by su ch member for the purpose. The benefits, privileges and emoluments of the Board shall be consistent with ex isting laws and rules. The benefits, privileges and emoluments of the Board shal l be consistent with existing laws and rules. SEC. 8. Powers and Functions of the Board. - The Authority shall primarily be re sponsible for formulating, continuing, coordinated and fully integrated technica l education and skills development policies, plans and programs taking into cons ideration the following: The State policy declared herein of giving new direction and thrusts to efforts in developing the quality of Filipino human resource through technical education and skills development; the implementation of the above-mentioned policy requir es the coordination and operation of policies, plans, and programs of different concerned sectors of Philippine society; equal participation of representatives of industry groups, trade associations, employers, workers and government shall be made the rule in order to ensure that urgent needs and recommendations are re adily addressed; and improved linkages between industry, labor and government sh all be given priority in the formulation of any national-level plan. The Board, shall have the following powers: promulgate, after due consultation w ith industry groups, trade associations, employers, workers, policies, plans, pr ograms and guidelines as may be necessary for the effective implementation of th is Act; Organize and constitute various standing committees, subsidiary groups, or techn ical working groups for efficient integration, coordination and monitoring techn ical education and skills development programs at the national, regional, and lo cal levels;

Enter into, make, execute, perform and carry-out domestic and foreign contracts subject to existing laws, rules and regulations. Restructure the entire sub-sector consisting of all institutions and programs in volved in the promotion and development of middle-level manpower through upgradi ng, merger and/or phase-out following a user-led strategy; Approve trade skills standards and trade tests as established and conducted by p rivate industries; Establish and administer a system of accreditation of both public and private in stitutions; Establish, develop and support institutions' trainors' training and/or programs; Lend support and encourage increasing utilization of the dual training system as provided for by Republic Act. No. 7686; Exact reasonable fees and charges for such tests and trainings conducted and ret ain such earnings for its own use, subject to guidelines promulgated by the Auth ority; Allocate resources, based on the Secretariat's recommendations for the programs and subjects it shall undertake pursuant to approved National Technical Educatio n and Skills Development Plan; Determine and approve systematic funding schemes such as the Levy and Grant sche me for technical education and skills development purposes; Create, when deemed necessary, an Advisory Committee which shall provide expert and technical advice to the Board to be chosen from the academe and the private sector: Provided, That in case the Advisory Committee is created, the Board is hereby au thorized to set aside a portion of its appropriation for its operation; And perform such other duties and functions necessary to carry out the provision s of this Act consistent with the purposes of the creation of TESDA. SEC. 9. Power to Review and Recommend Action.- The Authority shall review and re commend action to concerned authorities on proposed technical assistance program s and grants-in-aid for technical education or skills development, or both, incl uding those which may be entered into between the Government of the Philippines and other nations, including international and foreign organizations, both here and abroad. SEC. 10. The TESDA Secretariat - There is hereby created a Technical Education a nd Skills Development Authority Secretariat which shall have the following funct ions and responsibilities: to propose to the Authority the specific allocation of resources for the program s and projects it shall undertake pursuant to approved national technical educat ion and skills development plan; to submit to the Authority periodic reports on the progress and accomplishment o f work programs of implementation of plans and policies for technical education and skills development; to prepare for approval by the Authority an annual report to the President on te chnical education and skills development; to implement and administer the apprenticeship program as provided for in Sectio n 18 of his Act; to prepare and implement upon approval by the Authority a program for the traini ng of trainers, supervisors, planners and managers as provided for in Section 23 of this Act; to enter into agreement to implement approved plans and programs and perform act ivities as shall implement the declared policy of this Act; and to perform such other functions and duties as may be assigned by the Board. SEC. 11. Director-General.- The TESDA Secretariat shall be headed by a DirectorGeneral, who shall likewise be a member of the TESDA Board. The Director-General shall be appointed by the President of the Philippines and shall enjoy the bene

fits, privileges and emoluments equivalent to the rank of Undersecretary. As Chi ef Executive Officer of the TESDA Secretariat, the Director-General shall exerci se general supervision and control over its technical and administrative personn el. SEC. 12. Deputy Directors-General. - The Director-General shall be assisted by t wo (2) Deputy Directors-General to be appointed by the President of the Philippi nes on recommendation of the TESDA Board. One to be responsible for Vocational a nd Technical Education and Training and one to be responsible for Policies and P lanning. The Deputy Directors-General shall enjoy the benefits, privileges and e moluments equivalent to the rank of Assistant Secretary. SEC. 13. Chief of Services for Administration. - The Director-General shall also be assisted by a Chief of Services for Administration who shall be a Career Civ il Service Official to be appointed by the TESDA Board. SEC. 14. Structural Organization and Personnel. - The TESDA Secretariat, in addi tion to the offices of the Director-General, Deputy Director-General and Chief o f Services for Administration shall be composed of the following offices to be h eaded by an Executive Director to be appointed by the Director-General and shall have the rank and emoluments of director IV. Planning Office (PO) The Planning Office shall be under the Office of the Deputy Director-General and shall have the following functions: to design and establish planning processes and methodologies which will particul arly enhance the efficiency of resource allocation decisions within the technica l education and skills development sector; to lead in the preparation and periodic updating of a national plan for technica l education and skills development which shall become the basis for resource all ocation decisions within the sector; to conduct researchers, studies and develop information systems for effective an d efficient planning and policy making within the sector; to develop and implement programs and projects aimed at building up planning cap abilities of various institutions within the sector; and to perform such other powers and functions as may be authorized by the Authority . Skills Standards and Certification Office (SSCO) - The Skills Standards and Cert ification Office shall be under the office of the Deputy Director-General and sh all have the following functions: to develop and establish a national system of skills standardization, testing an d certification in the country; to design, innovate and adopt processes and methodologies whereby industry group s and workers' guilds take note on progressively the responsibility of setting s kills standards for identified occupational areas, and the local government unit s actively participate in promoting skills standards, testing and certification; to establish and implement a system of accrediting private enterprises, workers' associations and guilds and public institutions to serve as skills testing venu es; to conduct research and development on various occupational areas in order to re commend policies, rules and regulations for effective and efficient skills stand ardization, testing and certification system in the country; and to perform such other duties and functions as may be authorized. National Institute for Technical Vocational and Education Training (NITVET) - Th

e National Institute for Technical Vocational and Education Training to be under the office of the Deputy Director-General and shall have the following function s: to serve as the research and development arm of the government in the field of t he technical-vocational education and training; to develop curricula and program standards for various technical-vocational educ ation and training areas; to develop and implement an integrated program for continuing development of tra inors, teachers and instructors within the technical education and skills develo pment sector; to develop programs and project which will build up institutional capabilities w ithin the sector; and to perform such other powers and functions as may be authorized.

National Institute for Technical Vocational and Education Training (NITVET) - Th e National Institute for Technical Vocational and Education Training to be under the office of the Deputy Director-General and shall have the following function s: to serve as the research and development arm of the government in the field of t he technical-vocational education and training; to develop curricula and program standards for various technical-vocational educ ation and training areas; to develop and implement an integrated program for continuing development of tra inors, teachers and instructors within the technical education and skills develo pment sector; to develop programs and project which will build up institutional capabilities w ithin the sector; and to perform such other powers and functions as may be authorized. Office of Formal Technical Vocational Education and Training (OFTVET) - The Offi ce of Formal Technical Vocational Education and Training to be under the office of the Deputy Director-General and shall have the following functions: to provide policies, measures and guidelines for effective and efficient adminis tration of formal technical-vocational education and training programs implement ed by various institutions in the country; to establish and maintain a system for accrediting, coordinating, integrating, m onitoring and evaluating the different formal technical-vocational education and training programs vis--vis the approved national technical education and skills development plan; to establish and maintain a network of institutions engaged in institutionalized technical-vocational education and training, particularly with local government units; and to perform such other duties and functions as may be authorized. Office of the Non-Formal Technical-Vocational Education and Training (ONFTVET) The Office of the Non-Formal Technical-Vocational Education and Training to be under the office of the Deputy Director-General and shall have the following fun ctions: to provide direction, policies and guidelines for effective implementation of no n-formal community-based technical-vocational education and training; to accredit, coordinate, monitor and evaluate various non-formal technical-vocat ional education and training programs implemented by various institutions partic

ularly, by local government units; to establish and maintain a network of institutions including local government u nits, non-government organizations implementing non-formal, community-based tech nical-vocational education and training; to perform such other powers and functions as may be authorized. Office of Apprenticeship (OA). - The Office of Apprenticeship shall be under the office of the Deputy Director-General and shall have the following functions: to provide direction, policies and guidelines on the implementation of the appre nticeship system; to accredit, coordinate, monitor and evaluate all apprenticeship schemes and pro gram implemented by various institutions and enterprises; to establish a network of institutions and enterprises conducting apprenticeship schemes and programs; to perform such other powers and functions as may be authorized. Regional TESDA Offices - The Regional TESDA Offices shall be headed by Regional Directors with the rank and emoluments of Director IV to be appointed by the Pre sident. The Regional TESDA Offices shall be under the direct control of the Dire ctor-General and shall have the following functions: to serve as Secretariat to Regional Technical Education Skills Development (TESD A) Committee; to provide effective supervision, coordination and integration of technical educ ation and skills development programs, projects and related activities in their respective jurisdictions; to develop and recommend TESDA programs for regional and local-level implementat ion within the policies set by the Authority. To perform such other duties and functions as may be deemed necessary. SEC. 15. The Provincial TESDA Offices. - The Provincial Offices shall be headed by Skill Development Officers who shall have the rank and emoluments of a Direct or III. The Provincial TESDA Offices shall be under the direct control of the Director-G eneral and shall have the following functions: to serve as Secretariat to Provincial TESDA Committees; to provide technical assistance particularly to local government units for effec tive supervisions, coordination, integration and monitoring of technical-vocatio nal education and training programs within their localities; to review and recommend TESDA Programs for implementation within their localitie s; and to perform such other duties and functions as may be authorized. Furthermore, th e TESDA Secretariat maybe further composed by such offices as may be deemed nece ssary by the Authority. The Director-General shall appoint such personnel necess ary to carry out the objectives, policies and functions of the Authority subject to civil service laws, rules and regulations. SEC. 16. Compliance with the Salaries Standardization Law. - The compensation an d emoluments of the officials and employees of the Authority shall be in accorda nce with the salary standardization law and other applicable laws under the nati onal compensation and classification plan. SEC. 17. Consultants and Technical Assistance, Publication and Research. - In pu rsuing its objectives, the Authority is hereby authorized to set aside a portion of its appropriation for the hiring of services of qualified consultants, and p

rivate organizations for research work and publication in the field of technical education and skills development. It shall avail itself of the services of othe r agencies of the Government as may be required. SEC. 18. Transfer of the Apprenticeship Program. - The Apprenticeship Program of the Bureau of Local Employment of the Department of Labor and Employment shall be transferred to the Authority which shall implement and administer said progra m in accordance with existing laws, rules and regulations. SEC. 19. Technical Education and Skills Development Committees. - The Authority shall establish Technical Education and Skills Development Committees at the reg ional and local levels to coordinate and monitor the delivery of all skills deve lopment activities by the public and private sectors. These committees shall lik ewise serve as the Technical Education and Skills Development Committees of the Regional and local development councils. The compositions of the Technical Educa tion and Skills development Committees shall be determined by the Director-Gener al subject to the guidelines to be promulgated by the Authority. SEC. 20. Skills Development Centers. - The Authority shall strengthen the networ k of national, regional and local skills training centers for the purpose of pro moting skills development. This network shall include skills training centers in vocational and technical schools, technical institutes, polytechnic colleges, a nd all other duly accredited public and private dual system educational institut ions. The technical education and skills development centers shall be administer ed and operated under such rules and regulations as may be established by the Au thority in accordance with the National Technical Education and Skills Developme nt Plan. SEC. 21. Formulation of a Comprehensive Development Plan for Middle- Level Manpo wer. The Authority shall formulate a comprehensive development plan for middle-l evel manpower based on a national employment plan or policies for the optimum al location, development and utilization of skilled workers for employment entrepre neurship and technology development for economic and social growth. This plan sh all after adoption by the Authority be updated periodically and submitted to the President of the Philippines for approval. Thereafter, it shall be the plan for the technical education and skills development for the entire country within th e framework of the National Development Plan. The Authority shall direct the TES DA Secretariat to call on its member-agencies, the private sector and the academ e to assist in this effort. The comprehensive plan shall provide for a reformed industry-based training program including apprenticeship, dual training system a nd other similar schemes intended to: promote maximum protection and welfare of the worker-trainee; improve the quality and relevance and social accountability of technical educati on and skills development; accelerate the employment-generation effort of the government; and expand the range of opportunities for upward social mobility of the school-going population beyond the traditional higher levels of formal education. All govern ment and non-government agencies receiving financial and technical assistance fr om the government shall be required to formulate their respective annual agency technical education and skills development plan in line with the national techni cal education and skills development plan. The budget to support such plans shal l be subject to review and endorsement by the Authority to the Department of Bud get and Management. The Authority shall evaluate the efficiency and effectivenes s of agencies skills development program and schemes to make them conform with t he quantitative and qualitative objectives of the national technical education a nd skills development plan. SEC. 22. Establishment and Administration of National Trade Skills Standards. There shall be national occupational skills standards to be established by TESDA

-accredited industry committees. The Authority shall develop and implement a cer tification and accreditation program in which private industry groups and trade associations are accredited to conduct approved trade tests, and the local gover nment units to promote such trade testing activities in their respective areas i n accordance with the guidelines to be set by the Authority. The Secretary of La bor and Employment shall determine the occupational trades for mandatory certifi cation. All certificates relating to the national trade skills testing and certi fication system shall be issued by the Authority through the TESDA Secretariat. SEC. 23. Administration of Training Programs. - The Authority shall design and a dminister training programs and schemes the will develop the capabilities of pub lic and private institutions to provide quality and cost-effective technical edu cation and skills development and related opportunities. Such training programs and schemes shall include teacher's trainors' training, skills training for entr epreneur development and technology development, cost-effective training in occu pational trades and related fields of employment, and value development as an in tegral component of all skills training programs. SEC. 24. Assistance to Employers and Organizations. - The Authority shall assist any employer or organization engaged in skills training schemes designed to att ain its objectives under rules and regulations which the Authority shall establi sh for this purpose. SEC. 25. Coordination of All Skills Training Schemes. - In order to integrate th e national skills development efforts, all technical education and skills traini ng schemes as provided for in this Act shall be coordinated with the Authority p articularly those having to do with the setting of trade skills standards. For t his purpose, existing technical education and skills training programs in the Go vernment and in the private sector, specifically those wholly or partly financed with government funds, shall be reported to the Authority which shall assess an d evaluate such programs to ensure their efficiency and effectiveness. SEC. 26. Industry Boards. - The Authority shall establish effective and efficien t institutional arrangements with industry boards and such other bodies or assoc iations to provide direct participation of employers and workers in the design a nd implementation of skills development schemes, trade skills standardization an d certification and such other functions in the fulfillment of the Authority's o bjectives. SEC. 27. Incentives Schemes. - The Authority shall develop and administer approp riate incentive schemes to encourage government and private industries and insti tutions to provide high-quality technical education and skills development oppor tunities. SEC. 28. Skills Development Opportunities. - The Authority shall design and impl ement an effective and efficient delivery system for quality technical education and skills development opportunities particularly in disadvantaged sectors, wit h new tools of wealth creation and with the capability to take on higher value-a dded gainful activities and to share equitably in productivity gains. SEC. 29. Devolution of TESDA's Training Function to Local Governments. - In esta blishing the delivery system provided for in the preceding Section, the Authorit y shall formulate, implement and finance a specific plan to develop the capabili ty of local government units to assume ultimately the responsibility for effecti vely providing community-based technical education and skills development opport unities: Provided, however, That there shall be formulated and implemented, an e ffective and timely retraining of TESDA personnel that would be affected by the devolution to ensure their being retained if the concerned local government unit s would not be able to absorb them. SEC. 30. Skills Olympics. - To promote quality skills development in the country

and with the view of participating in international skills competitions, the Au thority, with the active participation of private industries, shall organize and conduct annual National Skills Olympics. The Authority, through the TESDA Secre tariat, shall promulgate the necessary rules and guidelines for the effective an d efficient conduct of Annual National Skills Olympics and for the country's par ticipation in internationals skills olympics. SEC. 31. The TESDA Development Fund. - A TESDA Development Fund is hereby establ ished, to be managed/administered by the Authority, the income from which shall be utilized exclusively in awarding of grants and providing assistance to traini ng institutions, industries, local government units for upgrading their capabili ties and to develop and implement training and training-related activities. The contribution to the fund shall be the following: a one-time lump sum appropriation from the National Government; an annual contri bution from the Overseas Workers Welfare Administration Fund, the amount of whic h should be part of the study on financing in conjunction with letter (D) of Sec tion 34; donations, grants, endowments, and other bequests or gifts, and any oth er income generated by the Authority. The TESDA Board shall be the administrator of the fund, and as such, shall formu late the necessary implementing guidelines for the management of the fund, subje ct to the following: a) unless otherwise stipulated by the private donor, only e arnings of private contributions shall be used; and b) no part of the seed capit al of the fund, including earnings, thereof, shall be used to underwrite expense s for administration. The Board shall appoint a reputable government-accredited investment institution s as fund manager, subject to guidelines promulgated by the Board. SEC 32. Scholarship Grants. - The authority shall adopt a system of allocation a nd funding of scholarship grants which shall be responsive to the technical educ ation and skills development needs of the different regions in the country. SEC 33. TESDA Budget. - The amount necessary to finance the initial implementati on of this Act shall be charged against the existing appropriations of the NMYC and the BTVE. Thereafter, such funds as may be necessary for the continued imple mentation of this Act shall be included in the annual General Appropriations Act . SEC 34. Transitory Provisions. - a) Within two (2) months after the approval of this Act, the President shall, in consultation with the Secretary of Labor and E mployment and the Secretary of Education, Culture and Sports, appoint the privat e sector representatives of the TESDA Board. Within (3) months after the appointment of the private sector representatives, t he President shall, upon the recommendation of the Board, appoint the General-Di rector. Within (4) months after the appointment of the Director General, the Board shall convene to determine the organizational structure and staffing pattern of the A uthority. Within (1) year after the organization of the Authority, the Board shall commiss ion an expert group on funding schemes for the TESDA Development Fund, as provid ed in Section 31, the results of which shall be used as the basis for appropriat e action by the Board. The personnel of the existing National Manpower and Youth Council (NMYC) of the Department of Labor and Employment and the Bureau of Technical and Vocational Ed ucation (BTVE) of the Department of Education, Culture and Sports, shall, in a h oldover capacity, continue to perform their respective duties and responsibiliti es and receive their corresponding salaries and benefits until such time when th e organizational structure and staffing pattern of the Authority shall have been approved by the Board: Provide, That the preparation and approval of the said n ew organizational structure and staffing pattern shall, as far as practicable, r

espect and ensure the security of tenure and seniority rights affected governmen t employees. Those personnel whose positions are not included in the new staffin g pattern approved by the Board or who are not reappointed or who choose to be s eparated as a result of the reorganization shall be paid their separation or ret irement benefits under existing laws. SEC 35. Automatic review. - Every five (5) years, after the affectivity of this Act, an independent review panel composed of three (3) persons appointed by the President shall review the performance of the authority and shall make recommend ations, based on its findings to the President shall review the performance of t he Authority and shall make the recommendations, based on the findings to the Pr esident and to both Houses of Congress. SEC. 36. Implementing Rules and Guidelines. - The TESDA board shall issue, withi n a period of ninety (90) days after the affectivity of this Act, the rules and regulations for the effective implementation of this Act. The TESDA Board shall submit tot he committees on Education, Arts and Culture of both Houses of Congre ss copies of the implementing rules and guidelines within (30) days after its pr omulgation. Any violation of this Section shall render the official/s concerned liable under R.A. No. 6713, otherwise known as the "Code of Conduct and Ethical Standards for Public Officials and Employees" and other existing administrative and/or criminal laws. SEC. 37. Repealing Clause. - All laws, presidential decrees, executive orders, p residential proclamations, rules and regulations or part thereof contrary to or inconsistent with this Act are hereby repealed or modified accordingly. SEC. 38. Separability Clause. - If any provision of this Act is declared unconst itutional, the same shall not affect the validity and effectivity of the other p rovisions hereof. SEC. 39. Effectivity. - This Act shall take effect fifteen (15) days after its c omplete publication in two (2) newspapers of general circulation. Approved, (SGD) JOSE DE VENECIA, JR. Speaker of the House Of Representatives (SGD) EDGARDO J. ANGARA President of the Senate This Act, which is a consolidation of Senate Bill No. 1283 and House Bill No. 12 194, was finally passed by the Senate and the House of Representatives on August 23, 1994. (SGD) CAMILO L. SABIO Secretary General House of Representatives (SGD) EDGARDO E. TUMANGAN Secretary of the Senate Approved: FIDEL V. RAMOS President of the Philippines The Congress-approved measure was signed into law by President Fidel V. Ramos on August 25, 1994. RULES AND REGULATIONS IMPLEMENTING THE TESDA ACT OF 1994 Pursuant to Section 36 of the TESDA Act of 1994, the TESDA Board hereby promulga tes the Implementing Rules and Regulations of the Act, as follows:

RULE I POLICIES AND OBJECTIVES SECTION 1. Title. - These Rules shall be known and cited as the Rules and Regulations Implementing the TESDA Act of 1994. SEC. 2. Declaration of Policy. - It is the declared policy of the State to provi de relevant, accessible, high quality and efficient technical education and skil ls development in support of the development of high quality Filipino middle-lev el manpower responsive to and in accordance with Philippine development goals an d priorities. Private Sector Participation. - The State shall encourage the active participati on of various concerned sectors, particularly private enterprises, being direct participants in and immediate beneficiaries of a trained and skilled workforce, in providing technical education and skills development opportunities. SEC. 3. Statement of Goals and Objectives. - The goals and objectives of TESDA A ct of 1994 (hereinafter cited as Act) are as follows: International Competitiveness. - To promote and strengthen the quality of techni cal education and skills development programs to attain international competitiv eness; Quality Middle-Level Manpower. - To focus technical education and skills develop ment on meeting the changing demands for quality middle-level manpower. Scientific and Technical Knowledge Base. - To encourage critical and creative th inking by disseminating the scientific and technical knowledge base of middle-le vel manpower development programs; Roles of Public and Private Institutions. - To recognize and encourage the compl ementary roles of public and private institutions in technical education and ski lls development and training systems; and Desirable Values. - To inculcate desirable values through the development of mor al character, with emphasis on work ethic, self-discipline, self-reliance and na tionalism. RULE II TECHNICAL EDUCATION AND SKILLS DEVELOPMENT PLAN SEC. 1. Formulation of a Comprehensive Development Plan for Middle-Level Manpowe r. - The Technical Education and Skills Development Authority (TESDA) shall form ulate a comprehensive development plan for middle-level manpower based on a nati onal employment plan or policies for the optimum allocation, development and uti lization of skilled workers for employment, entrepreneurship and technology deve lopment for economic and social growth, to be known as the National Technical Ed ucation and Skills Development Plan. SEC. 2. President's Approval. - This plan, after adoption by the TESDA Board, sh all be updated periodically and submitted to the President of the Philippines fo r approval. Thereafter, it shall be the plan for technical education and skills development for the entire country within the framework of the National Developm ent Plan. SEC. 3. Assistance of Private Sector and the Academe. - The TESDA Board shall di rect the TESDA Secretariat to call on its member-agencies, the private sector an d the academe to assist in the formulation of the plan. SEC. 4. Reformed Industry-Based Training Program. - The comprehensive plan shall provide for a reformed industry-based training program including apprenticeship , dual training system and other similar schemes intended to: provide maximum protection and welfare of the worker-trainee; improve the quality and relevance and social accountability of technical educati on and skills development; accelerate the employment-generation efforts of the government; and

expand the range of opportunities for upward social mobility of the school-going population beyond the traditional higher levels of formal education. SEC. 5. Review and Endorsement of Agencies' Budgets. - All government and non-go vernment agencies receiving financial and technical assistance from the governme nt shall be required to formulate their respective annual agency technical educa tion and skills development plans in line with the national technical education and skills development plan. The budget to support such plans shall be subject t o review and endorsement to the Department of Budget and Management by the TESDA . SEC. 6. TESDA's Evaluation of Agencies' Programs. - The TESDA shall evaluate the efficiency and effectiveness of the agencies' skills development programs and s chemes to make them conform with the quantitative and qualitative objectives of the national technical education and skills development plan. SEC. 7. Submission of Reports of TESDA. - In such form as the TESDA may prescrib e, the agencies mentioned in Section 5 hereof shall submit reports on how they h ave implemented their technical education and skills development plans annually to the TESDA or as often as it may require. RULE III TESDA BOARD SEC. 1. Creation of the Technical Education and Skills Development Authority. To implement the policy declared in the Act, a Technical Education and Skills De velopment Authority is created, (hereinafter referred to as the Authority or TES DA). The Authority shall be composed of the TESDA Board as its governing body, a nd the TESDA Secretariat as its executive arm. The TESDA shall replace and absor b the National Manpower and Youth Council (NMYC), the Bureau of Technical and Vo cational Education (BTVE) and the personnel and functions pertaining to technica l-vocational education in the regional offices of the Department of Education, C ulture and Sports (DECS), and the apprenticeship program of the Bureau of Local Employment of the Department of Labor and Employment. SEC. 2. Composition of the TESDA Board.*- The TESDA Board is composed of the fol lowing: The Secretary of Labor and Employment Chairperson Secretary of Education, Culture and Sports Co-Chairperson Secretary of Trade and Industry Co-Chairperson Secretary of Agriculture Member Secretary of Interior and Local Government Member Director General of the TESDA Secretariat Member Private sector representatives appointed by the President: Two (2) representatives from the employer/industry organization, one of whom sha ll be a woman; Three (3) representatives from the labor sector, one of whom shall be a woman; a nd To (2) representatives of national associations of private technical-vocational education and training institutions, one of whom shall be a woman. SEC. 3. Term of Office. - As soon as all the members of the private sector are a ppointed, they shall so organize themselves that the term of office of one-third (1/3) of their number shall expire every year. The members from the private sec tor appointed thereafter to fill vacancies caused by expiration of terms shall h old office for three (3) years. SEC. 4. Change of Membership. - The President of the Philippines may revise the

membership of the TESDA Board through an administrative order whenever the Presi dent deems it necessary for the effective performance of the Board's functions. SEC. 5. Meetings, Emoluments. - The TESDA Board shall meet at least twice a year , or as frequently as may be deemed necessary by its Chairperson. In the absence of the Chairperson, a Co-Chairperson shall preside. In case any member of the B oard representing the Government cannot attend the meeting, he or she shall be r egularly represented by an undersecretary or deputy-director general, as the cas e may be, to be designated by such member for the purpose. The benefits, privileges and emoluments of the Board shall be consistent with ex isting laws and rules. SEC. 6. Functions and Powers of the Board. Function. - The TESDA Board shall be primarily responsible for the formulation o f continuing, coordinated and fully integrated technical education and skills de velopment policies, plans and programs taking into consideration the following: the State policy declared in the Act of giving new direction and thrusts to effo rts in developing the quality of Filipino human resources through technical educ ation and skills development. The implementation of the above-mentioned policy r equires the coordination and cooperation of policies, plans and programs of diff erent concerned sectors of Philippine society; Equal participation of representa tives of industry groups, trade associations, employers, association of technica l-vocational schools workers and government shall be made the rule in order to e nsure that urgent needs and recommendations are readily addressed; and Improved linkages between industry, labor and government shall be given priority in the f ormulation of any national-level plan. Powers. - The TESDA Board shall have the following powers: Approve and promulgate, after due consultation with industry groups, trade assoc iations, associations of technical-vocational schools, employers and workers, th e National Technical Education and Skills Development Plan for middle-level manp ower and the policies, programs and guidelines as may be necessary for the effec tive implementation of the plan and of the Act; organize and constitute various standing committees, subsidiary groups, or technical working groups for efficien t integration, coordination and monitoring technical education and skills develo pment programs at the national, regional, and local levels; enter into, make, ex ecute, perform and carry out domestic and foreign contracts subject to existing laws, rules and regulations; restructure the entire sub-sector consisting of all institutions and programs involved in the promotion and development of middle-l evel manpower through upgrading, merger and/or phase-out following a user-led st rategy; approve trade skills standards and trade tests as established and conduc ted by private industries; establish and administer a system of accreditation of both public and private institutions; establish, develop and support trainors' training and/or programs; lend support and encourage increasing utilization of t he dual training system as provided for by republic Act No. 7686; exact reasonab le fees and charges for such tests and trainings conducted and retain such earni ngs for the use of the TESDA, subject to guidelines promulgated by the TESDA Boa rd; allocate resources, based on the TESDA Secretariat's recommendations, for th e programs and projects it shall undertake pursuant to an approved National Tech nical Education and Skills Development Plan; determine and approve systematic fu nding schemes such as the Levy-and-Grant scheme for technical education and skil ls development purposes; create, when deemed necessary, an Advisory Committee wh ich shall provide expert and technical advice to the Board to be chosen from the academe and the private sector: Provided, that in case the Advisory Committee i s created, the Board is hereby authorized to set aside a portion of its appropri ation for its operation; create such offices as it may deem necessary to carry o ut objectives, policies and functions of the TESDA; review and approve annual an

d other reports to the President on technical education and skills development; manage and administer the TESDA Development Fund and formulate is implementing g uidelines; and perform such other duties and functions necessary to carry out th e provisions of the Act. RULE IV TESDA SECRETARIAT SEC. 1. TESDA Secretariat. - The TESDA Secretariat, created under Sec. 10 of the Act, is composed of the Offices mentioned in this Rule. SEC. 2. Functions and responsibilities of the TESDA Secretariat. - The Secretari at shall have the following functions and responsibilities: to establish and maintain a planning process and formulate a national technical education and skills development plan in consultation with the member agencies a nd other concerned of the TESDA at various levels; to provide analytical inputs to policy and decision-making of the TESDA on alloc ation of resources and on institutional roles and responsibilities as shall be e mbodied with the agencies annual technical education and skills development plan s, in accordance with the manpower plan for middle-level skilled workers as appr oved by the TESDA Board; to recommend measures and implement the same upon approval by the TESDA Board, f or the effective and efficient implementation of the national technical educatio n and skills development plan; to propose to the TESDA Board the specific allocation of resource for the progra ms and projects it shall undertake pursuant to the approved national technical e ducation and skills development plan; to submit the TESDA Board periodic reports on the progress and accomplishment of work programs and on the implementation of plans and policies for technical edu cation and skills development; to prepare for approval by the TESDA Board an annual report to the president on technical education and skills development; to implement and administer the apprenticeship program; to prepare and implement, upon approval by the TESDA Board, programs for the tra ining of trainers, supervisors, planners and managers. to enter into agreements to implement plans and programs approved by the TESDA B oard and perform activities as shall implement the declared policy of the Act; to propose to the TESDA Board the policies and guidelines for the organization a nd constitution of the regional and local Technical Education and Skills Develop ment Committees, industry boards and technical working groups, as may be deemed necessary, and after their approval, to implement such policies and guidelines; Provided, that the Director-General, shall determine the composition of these bo dies subject to the guidelines adopted by the TESDA Board for the purpose; to review and endorse to the Department of Budget and Management in accordance w ith the guidelines approved by the TESDA Board the annual agency technical educa tion and skills development plans of all government and non-government agencies receiving financial technical assistance from the government; upon proper delega tion of authority from the TESDA Board, the TESDA Secretariat, thru the Director -General, shall also: review and recommend action to concerned authorities propo sed technical assistance programs and grants-in-aid-programs for the technical e ducation and skills development, or both, including those which may be entered i nto between the Government of the Philippines and other nations, including inter national and foreign organizations both here and abroad. Develop and administer appropriate incentive schemes to government and private industries and instituti ons to provide high quality technical education and skills development opportuni ties; Set policies for technical education and skills development programs for r egional and local-level implementations. Direct and approve institutional arrang ements with industry boards and such other bodies or associations for the direct

participation of employers and workers in technical education and skills develo pment including trade skills standardization and testing, apprenticeship and dua l training system. hire the services of qualified consultants and private organi zations for research work and publication in the field of technical education an d skills development and also avail itself of the services of other agencies of the Government as maybe required. to perform such other functions and duties as maybe assigned by the TESDA Board. DIRECTOR GENERAL SEC. 3. Director-General. - The TESDA Secretariat shall be headed by a DirectorGeneral, who shall likewise be a member of the TESDA Board. The Director-General shall enjoy the benefits, privileges and emoluments equivalent to the rank of U ndersecretary. As chief Executive Officer of the TESDA Secretariat, the Director-General shall exercise general supervision and control over its technical and administrative p ersonnel. SEC. 4. Deputy Directors-General. - The Director-General shall be assisted by tw o (2) Deputy Directors-General, one to be responsible for Vocational and Technic al Education and Training and one to be responsible for Policies and Planning. T he Deputy Directors-General shall enjoy the benefits, privileges and emoluments equivalent to the rank of Assistant Secretary. SEC. 5. Chief of Services for Administration. - The Director-General shall also be assisted by a Chief of Services for Administration who shall be a Career Civi l Service Official. SEC. 6. Appointment of TESDA Officials and Personnel. - The President shall appo int the Director-General, and the two Deputy Directors-General, upon recommendat ion of the TESDA Board. The President shall also appoint the heads of the region al offices. The Chief of Services for Administration shall be appointed by the T ESDA Board. The Director-General shall appoint an Executive-Director for each of the Offices under the two Deputy Directors-General who shall have the rank and emoluments of Director IV. The Director-General shall also appoint such personne l as may be necessary to carry out the objectives, policies and functions of the TESDA subject to Civil Service laws, rules and regulations. SEC. 7. Compliance with the Salaries Standardization Law. - The composition and emoluments of the officials and employees of the TESDA shall be in accordance wi th the salary standardization law and other applicable laws under the national c ompensation and classification plan. SEC. 8. Continuous Assessment and Study. - The TESDA Secretariat shall conduct c ontinuous assessment and study of the nature, behavior and the use of the countr y's stock of human resources and study areas directly or indirectly related to t echnical education and skills development. This, it shall do by: engaging directly in studies, researches and surveys; and engaging the services of duly recognized and competent individuals, groups of individuals, schools, un iversities or research institutions, through contracts, grants or any appropriat e arrangement. Documents, materials or whatever output or results obtained from the activities above shall form part of the property of the TESDA. SEC. 9. Automatic Review; Recommendations to the President and Congress. - Every five (5) years, after the effectivity of the Act, an independent review panel c omposed of three (3) persons appointed by the President shall review the perform ance of the TESDA and shall make recommendations based on its findings to the Pr esident and to both Houses of Congress. OFFICES OF THE TESDA SECRETARIAT

SEC. 10. The Planning Office (PO). - The PO shall: design and establish planning processes and methodologies which will particularl y enhance the efficiency of resource allocation decisions within the technical e ducation and skills development sector; lead in the preparation and periodic upd ating of a national plan for technical education and skills development which sh all become the basis for resource allocation decisions within the sector; conduc t researches, studies and develop information systems for effective and efficien t planning and policy making within the sector; develop and implement programs a nd projects aimed at building up planning capabilities of various institutions w ithin the sector; and perform such other powers and functions as may be authoriz ed. SEC. 11. Skills Standards and Certification Office (SSCO). - The SSCO shall: develop and establish a national system of skills standardization, testing and c ertification in the country; design, innovate and adopt processes and methodolog ies whereby industry groups and workers' guilds take on progressively the respon sibility of setting skills standards for identified occupational areas, and the local government units actively participate in promoting skills standards, testi ng and certification; establish and implement a system of accrediting private en terprises, workers' associations and guilds and public institutions to serve as skills testing venues; conduct research and development on various occupational areas in order to recommend policies, rules and regulations for effective and ef ficient skills standardization, testing and certification system in the country; and perform such other duties and functions as may be authorized. SEC. 12. National Institute for Technical Vocational Education and Training (NIT VET). - The NITVET shall: serve as the research and development arm of the government in the field of tech nical-vocational education and training; develop curricula and program standards for various technical-vocational education and training areas; develop and impl ement an integrated program for continuing development of trainors, teachers and instructors within the technical education and skills development sector; devel op programs and projects which will build up institutional capabilities within t he sector; and perform such other powers and functions as may be authorized. SEC. 13. Office of Formal Technical Vocational Education and Training (OFTVET). - The OFTVET shall: provide policies, measures and guidelines for effective and efficient administra tion of formal technical-vocational education and training programs implemented by various institutions in the country; establish and maintain a system for accr editing, coordinating, integrating, monitoring and evaluating the different form al technical-vocational education and training programs vis--vis the approved nat ional technical education and skills development plan; establish and maintain a network of institutions engaged in institutionalized technical-vocational educat ion and training, particularly with local government units; and perform such oth er powers and functions as may be authorized. SEC. 14. Office of the Non-formal Technical Vocational Education and Training (O NFTVET). - The ONFTVET shall: provide direction, policies and guidelines for effective implementation of non-f ormal community-based technical-vocational education and training; accredit, coo rdinate, monitor and evaluate various non-formal technical-vocational education and training programs implemented by various institutions, particularly by local government units; establish and maintain a network of institutions including lo cal government units, non-government organizations implementing non-formal commu

nity-based technical-vocational education and training; and perform such other p owers and functions as may be authorized. SEC. 15. Office of Apprenticeship (OA). - The OA shall: provide direction, policies and guidelines on the implementation of the apprenti ceship system; accredit, coordinate, monitor and evaluate all apprenticeship sch emes and programs implemented by various institutions and enterprises; establish a network of institutions and enterprises conducting apprenticeship schemes and programs; and perform such other powers and functions as may be authorized. REGIONAL AND PROVINCIAL TESDA OFFICES SEC. 16. Regional TESDA Offices. - The TESDA shall establish regional offices he aded by Regional Directors with the rank and emoluments of Director IV. The offi ces shall be under the direct control of the Director-General and shall: serve as Secretariat to Regional TESDA Committees; supervise, coordinate and int egrate, thru its Provincial TESDA Offices, all technical education and skills de velopment programs, projects and related activities in their respective jurisdic tion; develop and recommend TESDA programs for regional and local level implemen tation within the policies set by the TESDA; and perform other duties and functi ons as may be authorized. SEC. 17. Provincial TESDA Offices. - The TESDA shall also establish Provincial O ffices headed by Skill Development Offices with the rank and emoluments of a Dir ector III. These offices shall be under the direct control of the Director-Gener al and shall: serve as Secretariat to Provincial TESDA Committees; provide technical assistanc e particularly to local government units for effective supervision, coordination , integration and monitoring of technical-vocational education and training prog rams within their localities; and review and recommend TESDA programs for implem entation within their localities; and perform such other duties and function as may be authorized. SEC. 18. Additional Offices. - The TESDA Secretariat may be further composed by such offices as may be deemed necessary by the TESDA Board. RULE V TESDA COMMITTEES SEC. 1. Technical Education and Skills Development Committees. - The TESDA shall establish Technical Education and Skills Development Committees at the regional and local levels to coordinate and monitor the delivery of all technical educat ion and skills development activities of the public and private sectors. The TES DA Board is authorized to set aside a portion of the appropriation of the TESDA for the operation of the TESDA Committees. SEC. 2. TESDA Committees' Relations to Local Development Councils. - The TESDA C ommittees shall establish linkages with the appropriate regional and local devel opment councils in order that they may likewise serve as the Technical Education and Skills Development Committees of the said development councils. SEC. 3. Composition of TESDA Committees. - The composition of the Technical Educ ation and Skills Development Committees shall be determined by the Director-Gene ral subject to the guidelines promulgated by the TESDA Board. RULE VI

PROGRAMS AND ACTIVITIES SEC. 1. Programs and Activities in Technical Education and skills Development. The TESDA shall accredit, coordinate, integrate, monitor and evaluate all the d ifferent formal and non-formal technical-vocational education and training progr ams pursuant to the goals and objectives of the Act. Encouraging the active part icipation of the private sector, including industry groups, trade associations, employers and workers, and particularly private enterprises, the TESDA shall pro mote and strengthen the quality of these technical education and skills developm ent programs:middle-level manpower development programs; Vocational, administrative or training programs for the purpose of acquiring and developing job-related skills; programs and projects which will build up instit utional capabilities within the sector; technical education and skills developme nt programs at national, regional and local levels; formal technical-vocational education and training programs implemented by various institutions in the count ry; non-formal community based technical-vocation education and training program s; training programs and schemes focused on skills training for entrepreneur dev elopment and technology development, cost-effective training in occupational tra des and related fields of employment and value development as an integral compon ent of all skills training programs; training programs and schemes that include teacher's trainors' training and for the continuing development of trainors, tea chers and instructors within the technical education and skills development sect or; and programs for the training of supervisors, planners and managers. SEC. 2. User-Led or Market-Driven Strategy. - adopting a user-led or market driv en strategy, the TESDA shall promote strengthened linkages between educational/t raining institutions and industry to ensure that appropriate skills and knowledg e are provided by the educational system. SEC. 3. Apprenticeship and Learnership Programs. - Using the above-mentioned str ategy, in accordance with existing laws, rules and regulations, the TESDA shall implement and administer reformed industry-based apprenticeship and learneship p rograms which have been transferred from the Department of Labor and Employment to the TESDA by the Act. SEC. 4. Dual Training System. - Also using the strategy mentioned in Section 2 h ereof, the TESDA shall implement Republic Act No. 7686 otherwise known as the "D ual Training System Act. Of 1994" and lend support and encourage increasing util ization of the dual training system as provided for in the aforementioned Act. SEC. 5. Administration of Training Programs. - The TESDA shall design and admini ster training programs and schemes that will develop the capabilities of public and private institutions to provide quality and cost-effective technical educati on and skills development and related opportunities. SEC. 6. Establishment and Administration of National Trade Skills Standards. - T here shall be national occupational skills standards to be established by TESDA - accredited industry committees. The TESDA shall develop and implement a certif ication and accreditation program in which private groups and trade associations are accredited to conduct approved trade tests, and the local government units to promote such trade testing activities in their respective areas in accordance with the guidelines to be set by the TESDA. The Secretary of Labor and Employment shall determine the occupational trades fo r mandatory certification. All certificates relating to the national skills test ing and certification system shall be issued by the TESDA through its Secretaria t.

SEC. 7. Industry Boards. - The TESDA shall establish effective and efficient ins titutional arrangements with industry boards and such other bodies or associatio ns to provide direct participation of employers and workers in the design and im plementation of skills development schemes, trade skills standardization and cer tification and such other functions in the fulfillment of the TESDA's objectives . SEC. 8. Skills Development Centers. - The TESDA shall strengthen the network of national, regional and local skills training centers for the purpose of promotin g skills development. This network shall include skills training centers in vocational and technical s chools, technical institutions, polytechnic colleges, and all other duly accredi ted public and private dual system educational institutions. The technical educa tion and skills development centers shall be administered and operated under suc h rules and regulations as may be established by the TESDA in accordance with th e National Technical Education and Skills Development Plan. SEC. 9. Coordination of All Skills Training Schemes. - In order to integrate the national skills development efforts, all technical education and skills trainin g schemes as provided for in the Act shall be coordinated with the TESDA particu larly those having to do with the setting of trade skills standards. For this pu rpose, existing technical education and skills training programs in the Governme nt and in the private sector, specifically those wholly or partly financed with government funds, shall be reported to the TESDA which shall assess and evaluate such programs to ensure their efficiency and effectiveness. SEC. 10. Skills Development Opportunities. - The TESDA shall design and implemen t an effective and efficient delivery system for quality technical education and skills development opportunities particularly in disadvantaged sectors, with ne w tools of wealth creation and with the capability to take on higher value-added gainful activities and to share equitably in productivity gains. SEC. 11. Devolution of TESDA's Training Function to Local Governments. - In esta blishing the delivery system provided for in the preceding Section, the TESDA sh all formulate, implement and finance a specific plan to develop the capability o f local government units to assume ultimately the responsibility for effectively providing community-based technical education and skills development opportunit ies; Provided, however, that there shall be formulated and implemented an effect ive and timely retraining of TESDA personnel that would be affected by the devol ution to ensure their being retained if the concerned local government units wou ld not be able to absorb them. RULE VII TECHNICAL AND VOCATIONAL SCHOOLS AND TRAINING CENTERS SEC. 1. Public Technical and Vocational Schools. - The public technical and voca tional schools whose budgets are included in the TESDA budget per the annual Gen eral Appropriations Act, including those funded by local governments, shall be u nder the supervision of the TESDA. The pertinent DECS Orders and Memoranda shall continue to apply to said schools until they are modified or revoked by the TES DA Board. SEC. 2. Private Technical and Vocational Schools. - The private technical and vo cational schools shall be subject to reasonable supervision of the TESDA, in acc ordance with the 1992 Manual of Regulations for Private Schools, particularly it s Article IV, Supervision and Regulation of Private Schools and Article V. Accre ditation, until the aforementioned regulations are modified or revoked by the TE SDA Board.

SEC. 3. Training Center. - In its supervision of public and private training cen ters, the TESDA shall ensure that appropriate skills and knowledge are provided to industry by these training centers. RULE VIII PROMOTION, ASSISTANCE, SCHOLARSHIP GRANTS AND INCENTIVES SEC. 1. Skills Olympics. - To promote quality skills development in the country and with the view of participating in international skills competitions, the TES DA, with the active participation of private industries, shall organize and cond uct annual National Skills Olympics. The TESDA, through its Secretariat, shall p romulgate the necessary rules and guidelines for the effective and efficient con duct of Annual National Skills Olympics and for the country's participation in i nternational skills olympics. SEC. 2. Assistance to Employers and Organizations. - The TESDA shall assist any employer or organization engaged in skills training schemes designed to attain i ts objectives under rules and regulations which the TESDA shall establish for th is purpose. SEC. 3. Scholarship Grants. - The TESDA shall adopt a system of allocation and f unding of scholarship grants which shall be responsive to the technical educatio n and skills development needs of the different regions in the country. SEC. 4. Incentives Schemes. - The TESDA shall develop and administer appropriate incentive schemes to encourage government and private industries and institutio ns to provide high-quality technical education and skills development opportunit ies. RULE IX FINANCING FOR TECHNICAL EDUCATION AND SKILLS DEVELOPMENT SEC. 1. TESDA Budget. - The amount necessary to finance the initial implementati on of the Act shall be charged against the existing appropriations of the NMYC a nd the BTVE. Thereafter, such funds as may be necessary for the continued implem entation of the Act shall be included in the annual General Appropriations Act. SEC. 2. The TESDA Development Fund. - A TESDA Development Fund is established, t o be managed/administered by the TESDA, the income from which shall be utilized exclusively in awarding of grants and providing assistance to schools, training institutions, industries, local government units for upgrading their capabilitie s, and to develop and implement technical education and skills development progr ams. The Fund shall be set up through: a one-time lump sum appropriation from the National Government; an annual contri bution from the Overseas Workers Welfare Administration Fund, the amount of whic h should be part of the study on financing provided for in Section 4 of this Rul e; donations, grants, endowments, and other bequests or gifts; and any other inc ome generated by the TESDA. SEC. 3. Administrator and Fund Manager. - The TESDA Board shall be the administr ator of the Fund, and as such, shall formulate the necessary implementing guidel ines for the management of the Fund, subject to the following: a) unless otherwi se stipulated by the private donor, only earnings of private contributions shall be used; and b) no part of the seed capital of the Fund, including earnings, th ereof, shall be used to underwrite expenses for administration. The Board shall appoint a reputable government-accredited investment institution

as Fund manager, subject to guidelines promulgated by the Board. SEC. 4. Expert Group on Funding Scheme. - Within one (1) year after the organiza tion of the TESDA, the TESDA Board shall commission an expert group on funding s chemes for the TESDA Development Fund, the results of which shall be used as the basis for appropriate action by the Board. SEC. 5. Levy and Grant Scheme. - The TESDA may determine and approve systematic funding schemes for technical education and skills development purposes such as a levy and grant scheme whereby there shall be legal contributions from particip ating employers who would be beneficiaries of the employee training programs (of ten as a percentage of the payroll) which contributions are subsequently turned over or rebated to enterprise offering such program. SEC. 6. Fees and Charges. - The TESDA may exact reasonable fees and charges for such tests and trainings it may conduct and retain such earnings for its own use , subject to guidelines promulgated by the TESDA Board. SEC. 7. Instructional Improvement Fund. - The instructional improvement fund in public technical-vocational schools and institutions shall be used for the expan sion, upgrading or maintenance of school facilities, particularly machinery, equ ipment and other learning resources. RULE X DEFINITION OF TERMS SEC. 1. Definition of Terms under the Act. "Apprentice" is a person undergoing training for an approved apprenticeable occu pation during an established period assured by an apprenticeship agreement. "Apprenticeship" is training within employment with compulsory related theoretic al instructions involving a contract between an apprentice and an employer on an approved apprenticeable occupation. "Apprenticeship Agreement" is a contract wherein a prospective employer binds hi mself to train the apprentice who in turn accepts the terms of training for a re cognized apprenticable occupation, emphasizing the rights, duties and responsibi lities of each party. "Apprenticeable Occupation" is an occupation officially endorsed by a tripartite body and approved for apprenticeship by the Authority. "Dual System/Training" refers to a delivery system of quality technical and voca tional education which requires training to be carried out alternately in two ve nues: In school and in the production plant. In school training provides the tra inee the theoretical foundation, basic training, guidance and human formation, w hile in-plant develops his skills and proficiency in actual work conditions as i t continues to inculcate personal discipline and work values. "Learners" refer to persons hired as trainees in semi-skilled and other industri al occupations which are non-apprenticeable. Learnership programs must be approv ed by the Authority; "Levy-and-Grand System" refers to a legal contribution (often a percentage of th e payroll) from participating employers who would be beneficiaries of a vocation al or technical education or training program which is subsequently turned over or rebated to enterprises offering employee training programs; "Middle-Level Manpower" refers to those who have acquired practical skills and k nowledge through formal or non-formal education and training equivalent to at le ast a secondary education but preferably a post-secondary education with a corre sponding degree or diploma; or skilled workers who have become highly competent in their trade or craft as attested by industry; "Private Enterprise" refers to an economic system under which property of all ki nds can be privately owned and in which individuals, alone or in association wit

h another, can embark on a business activity. This includes industrial, agricult ural, agro-industrial or service establishments engaged in the production, manuf acturing, processing, repacking, assembly, or production of goods. "Skill" means the acquired and developed ability to carry out a task of job; "Skills Development" means the process through which learner and workers are sys tematically provided with learning opportunities to acquire or upgrade, or both, their ability, knowledge and behavior pattern required as qualifications for a job or range of jobs in a given occupational area. "Technical Education: refers to the education process designed at post-secondary and lower tertiary levels, officially recognized as non-degree programs aimed a t preparing technicians, para-professionals and other categories of middle-level workers by providing them with a board range of general education, theoretical, scientific and technological studies, and related job skills training. "Trade" means any group of interrelated jobs or nay occupation which is traditio nally or officially recognized as craft or artisan in nature requiring specific qualifications that can be acquired through work experience and/or training. "Trainees" are participants in a vocational, administrative or technical trainin g program for the purpose of acquiring and developing job-related skills; "Trainers" are persons who direct the practice of skills towards immediate impro vement in some task. "Trainor/Trainers" are persons who provide training to trainers aimed at develop ing the latter's capacities for imparting attitudes, knowledge, skills and behav ior patterns required for specific jobs, tasks, occupations or group of related occupations. "User-Led" or "Market-Driven Strategy" refers to a strategy which promotes stren gthened linkages between educational/training institutions and industry to ensur e that appropriate skills and knowledge are provided by the educational system. Market-Driven Strategy relies principally on market forces to determine supply/d emand ratios including the pricing of training and education. RULE XI TRANSITORY AND FINAL PROVISIONS SEC. 1. Private Sector Representatives. - Within two (20 months after the approv al of the Act, the President shall, in consultation with the Secretary of labor and Employment and the Secretary of Education, Culture and sports, appoint the p rivate sector representatives of the TESDA Board. SEC. 2. Appointment of the Director-General. - Within three (3) months after the appointment of the private sector representatives, the President shall, upon th e recommendation of the Board, appoint the Director- General. SEC. 3. Organizational Structure and Staffing Pattern. - Within four (4) months after the appointment of the Director-General, the Board shall convene to determ ine the organizational structure and staffing pattern of the TESDA. SEC. 4. Personnel of Absorbed Agencies. - The personnel of the existing National Manpower and Youth Council (NMYC) of the Department of Labor and Employment and the Bureau of Technical and Vocational Education (BTVE) of the Department of Ed ucation, Culture and Sports, shall, in a holdover capacity continue to perform t heir respective duties and responsibilities and receive their corresponding sala ries and benefits until such time when the organizational structure and staffing pattern of the TESDA shall have been approved by the Board: Provided, That the preparation and approval of the said new organizational structure and staffing p attern shall, as far as practicable, respect and ensure the security of tenure a nd seniority rights of affected government employees, as clarified in Sections 5 , 6, and 7 of this Rule. SEC. 5. Holdover Capacity in Respective Duties and Responsibilities. - A positio n is composed of a set of duties and responsibilities. Thus even if the title of said position is changed or the salary therefore is upgraded, the absorbed pers onnel who is performing the duties and responsibilities shall continue to hold s uch position and receive the appropriate upgraded salary of said retitled positi on, in a holdover capacity.

SEC. 6. Respecting and Insuring Security of Tenure. - As long as the duties and responsibilities of his position are needed by the TESDA, the absorbed personnel concerned shall not be forced to resign and be dismissed without just cause and without due process. If new and higher positions are created, the absorbed pers onnel who meets the qualification standards of the new position shall be given p reference in the filling up of said position. SEC. 7. Respecting Seniority Rights. - In filling up new positions, there shall be an open competition among the absorbed personnel taking into consideration th eir qualifications, performance and eligibility. If the absorbed personnel has to be retired under the provision of the next succ eeding section, it is understood that his other previous service in the governme nt shall be included or considered in the computation of his retirement benefits . SEC. 8. Separation or Retirement Benefits. - Those personnel whose positions are not included in the new staffing pattern approved by the TESDA Board or who are not reappointed or who choose to be separated as a result of the reorganization shall be paid their separation or retirement benefits under existing laws. SEC. 9. Consultation with Commission on Higher Education and the Appropriate Dep artment of Basic Education. - Upon the consultation of the TESDA Board, the TESD A may work out with the Commission on Higher Education and the appropriate Depar tment for Basic Education a system of cooperation and program management with re spect to educational institutions offering basic tertiary and post secondary pro grams paying special attention to delineation of programs, functions, responsibi lities, personnel and facilities. SEC. 10. Existing Policies and Projects in Force Until Revoked. - All policies a nd projects of the agencies replaced and absorbed by the TESDA involving technic al education and skills development programs shall remain in force unless or unt il modified or revoked by these Rules or by the TESDA. SEC.11. Permits and Certificates. - All permits and certificates of recognition issued by the agencies replaced and absorbed by the TESDA prior to these Rules a ffecting technical education and skills development shall continue to be in forc e and in effect. However, further action on such permits and certificates shall henceforth be undertaken by the TESDA. SEC.12. Separability Clause. - If any provision of these Rules is held invalid o r unconstitutional, any other provision not so affected shall continue to be val id and effective. SEC. 13. Repealing Clause. - Any law, presidential decree, executive order, lett er of instruction, and its rules and regulations, or any part thereof, which is inconsistent with any of the provisions of the Act and these Rules is hereby rep ealed or amended accordingly. SEC.14. Effectivity Clause. - These Rules shall take effect fifteen (15) days af ter its publication in the Official Gazette or in a newspaper of general circula tion. SEC.15. Issuances on Policies and Guidelines After Effectivity of the Rules. - T he TESDA Board shall, after due consultations are required by Section8, paragrap h 1 of the Act, promulgate from time to time issuances on policies and guideline s for the effective implementation of these Rules and Regulations. Done in Manila, Republic of the Philippines this 18th day of January 1995.