Under Article 128 of the Labor Code, the Secretary of the Department of Labor and Employment (DOLE),

or his authorized representative, may exercise visitorial powers, and may conduct routine inspections to
assess the compliance of business establishments and their contractors with labor standards. Labor
standards refer to the minimum requirements prescribed by existing laws, rules and regulations, and
other issuances in relation to labor and occupational safety and health standards.

In conducting labor standards inspections, the Secretary of Labor is granted considerable discretion, and
is authorized to enter business establishments without prior warning. During said inspections, the
Secretary of Labor is likewise authorized to request immediate access to the employer's records, and to
question any employee on the premises. When deemed appropriate, the Secretary of Labor may also
issue compliance orders to erring employers, and may even order the stoppage of work or the
suspension of operations.

In an effort to simplify and expedite the inspection process, the DOLE, on July 19, 2013, promulgated
Department Order 131-13 (DO 131-13), also known as the “Rules on Labor Laws Compliance System.”
The Labor Laws Compliance System (LLCS) refers to the integrated framework of voluntary compliance
and enforcement of labor laws and social legislation issued pursuant to the rule-making and visitorial
and enforcement power of the DOLE Secretary.

These Rules establish the procedure for the various modes of labor inspections, and provide for avenues
to reduce the number of labor cases by providing parties with an expedient manner of resolving labor
issues in a non-litigious manner. While initially, it may appear that these rules simply provide another
layer of bureaucratic red tape to the already complicated labor laws, however, a close perusal of the
same shows that it does provide several advantages for employers, such as improving labor relations
and reducing the likelihood of litigation arising from labor related issues. The Rules also provide for
limitations on the powers of DOLE officials in conducting said visitorial power.

DO 131-13 empowers DOLE personnel known as Labor Laws Compliance Officers (LLCOs) to conduct
three (3) modes of labor standards inspections, particularly: Joint Assessment, Compliance Visit, and
Occupational Safety and Health Standards Investigation. As a general rule, LLCOs may conduct labor
standards inspections only after authorized to do so via a Letter and Authority to Assess. This Letter and
Authority to Assess shall be issued by the appropriate DOLE Regional Director, and shall indicate the
reason for the visit. However, even in the absence of such a Letter and Authority to Assess, in case
where an immediate need for the same arises, an LLCO may still be allowed to conduct said inspections.

Joint Assessment and Compliance Visit

In a Joint Assessment, representatives of both the employer and the employees work in conjunction
with the LLCO to evaluate the establishment’s compliance with labor laws and social legislation anent a
prescribed assessment checklist. Joint assessments may be conducted at any private business
establishment, but DO 131-13 categorically provides for a priority list of specific establishments to be
inspected, including businesses employing ten (10) or more employees, businesses engaged in
hazardous work, those who employ child employees, those engaged in contracting/subcontracting
arrangements and Philippine registered ships or vessels engaged in domestic shipping.
Compliance Visits are initiated when an LLCO acts on a complaint filed against a particular establishment
or in cases where there has been a Single Entry Approach (SEnA) referral to the DOLE. During
Compliance Visits, the LLCO validates the establishment’s compliance with labor laws and social
legislation.

After the completion of the Joint Assessment or Compliance Visit, the LLCO will issue a Notice of Results,
indicating the deficiencies, if any, of the employer. The employer will then be given ten (10) days within
which to rectify said deficiencies, and will be directed to attend a mandatory conference. If the
establishment fails to remedy said deficiencies within the prescribed period, the DOLE Regional Director
has the authority to issue a Compliance Order directing the employer, within a period of ten (10) days,
to institute corrective measures, and to restitute the amount due the employees, if any.

Occupational Safety and Health Standards Investigations

The DOLE promulgated the Occupational Safety and Health Standards (OSHS), which require
establishments to implement various safety measures. The OSHS is intended to protect employees
against the dangers of injury, sickness or death through safe and healthful working conditions.

An OSHS Investigation is initiated by a report or information given to the DOLE which then, through an
LLCO, determines the existence of imminent danger, dangerous occurrence, or accident resulting to
disabling injury or any other analogous circumstance.

It has often been said that an ounce of prevention is better than a pound of cure. In this regard, it is
prudent for employers to conduct a thorough review and evaluation of their policies to ascertain
whether the same are fully compliant with labor laws and social legislation. The benefits of these
preventive measures far outweigh the sanctions imposed on non-compliant business establishments, as
the latter may be subjected to various fines and penalties, and in extreme cases, may even be required
to temporarily suspend operations