Erwin Tulfo files bill seeking worker protection vs. layoffs due to AI

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Senator Erwin Tulfo filed a bill seeking to protect workers from artificial intelligence-driven layoffs by amending the Labor Code to establish clear conditions for terminations and guarantee fair compensation.

Tulfo, chairperson of the Senate Committee on Social Justice, Welfare, and Development, introduced Senate Bill (SB) No. 2563, which proposes key amendments to Article 298 of the Labor Code of the Philippines.

“As companies adopt AI, employees whose jobs become redundant risk losing not only their employment but also their means of supporting their families. Technological progress is inevitable, but Filipino workers should not be left behind or made it bear its costs alone,” Tulfo wrote in his explanatory note.

In a statement on Sunday, the senator said SB No. 2563 requires employers to provide fair separation pay, opportunities for reskilling and redeployment, and advance notice with mandatory consultations for affected workers.

Under the bill, employers can only terminate workers due to AI automation if the following conditions are met:

• There must be a bona fide introduction of implementation of AI technologies or systems;
• AI implementations must be undertaken in good faith;
• The purpose for AI introduction or implementation is valid to save cost, enhance efficiency and other justifiable economic reasons;
• No other option available for the employer other than to introduce or implement AI technologies and the consequent termination of employee; and
• There must be fair and reasonable criteria in selecting employees to be terminated.

Should terminations occur, the bill requires employers to notify the Department of Labor and Employment (DOLE) at least six months in advance.

It also stipulates that employees terminated under these conditions are entitled to separation pay equal to at least two months pay or to at least two months pay for every year of service, whichever is higher.

Tulfo stressed that before turning to AI automation, employers must first exhaust all efforts to reskill their existing workforce before resorting to layoffs.

“There must be a proactive effort to keep workers away from termination just because AI comes in. We are not only talking about careers here, we are concerned with livelihood and lives of the employees’ families,” the senator said.

Malacañang meanwhile on Friday admitted that AI may displace workers. However, the technology could also bring new opportunities for Filipinos. —KG, GMA News