Dear PAO,

I am an OFW based in the United Arab Emirates (UAE). Lately, I have noticed some deductions in my pay slips related to insurance. I asked a clarification from my recruitment agency in the Philippines, and they informed me that these were for the compulsory worker’s insurance coverage that I am required by law to pay. Should I be the one paying for this? Please help me be clarified. Thank you.

Nori Jean

Dear Nori Jean,

The State recognizes the role of Overseas Filipino Workers (OFWs) in building the economy. Likewise, it sees the risk and vulnerability to abuse of OFWs abroad, who are only trying their hardest to make a decent living. Because of this, laws are in place to ensure that the rights and privileges of our OFWs are safeguarded.

Republic Act (RA) 8042, or the Migrant Workers and Overseas Filipinos Act of 1995, as amended by Republic Act (RA) 10022, explicitly prohibits the deduction of insurance fees, premium, or other insurance-related charges from an OFW’s salary. Under Section 5 (7) of the said law:

“In addition to the acts enumerated above, it shall also be unlawful for any person or entity to commit the following prohibited acts: x x x

“(7) For a recruitment/manning agency or a foreign principal/employer to pass on the overseas Filipino worker or deduct from his or her salary, the payment of the cost of insurance fees, premium or other insurance related charges, as provided under the compulsory worker’s insurance coverage. x x x”

To answer your question, it is illegal for your recruitment agency or foreign principal/employer to deduct the compulsory worker’s insurance coverage from your salary. The law is explicit in prohibiting them to shift the burden of paying the said insurance charges to the OFW.

Section 7 (c) of the same law prescribes the appropriate penalties against those who violate the above-mentioned provision. Accordingly:

“SEC. 7. Penalties. – x x x

“(c) Any person found guilty of any of the prohibited acts shall suffer the penalty of imprisonment of not less than six (6) years and one (1) day but not more than twelve (12) years and a fine of not less than Five hundred thousand pesos (P500,000.00) nor more than One million pesos (P1,000,000.00). x x x

“In every case, conviction shall cause and carry the automatic revocation of the license or registration of the recruitment/manning agency, lending institutions, training school or medical clinic.”

We hope that we were able to answer your queries. This advice was based solely on the facts you have narrated and our appreciation of the same. Our opinion may vary when other facts are changed or elaborated.

Thank you for your continued trust and support.

Editor’s note: Dear PAO is a daily column of the Public Attorney’s Office. Questions for Chief Acosta may be sent to [email protected]