NPM No. 120-2016

Requesting Entity: Land Transportation Office (LTO) - Region I Department of Labor and Employment (DOLE)

Issues Concern: DOLE DO No. 150-16



Clarification on the application of the provisions of DOLE Department Order (DO) No. 150-16, dated 9 February 2016, entitled Revised Guidelines Governing the Employment and Working Conditions of Security Guards and other Private Security Personnel in the Private Security Industry


Similar to the 10% administrative fee imposed under Section 9(b)(ii) of DOLE DO No. 18-A, the 20% administrative fee provided for under Section 4 of DOLE DO No. 150-16 is also a percentage rate that has for its effect the fixing of a floor price on Service Agreements. In this regard and following the position of the Government Procurement Policy Board (GPPB) as stated and explained in the following GPPB issuances, namely: GPPB Resolution (Res.) No.14-2012 dated 1 June 2012; GPPB Res. No. 14-2015 and GPPB Circular No. 04-2015, both dated 30 April 2015; and Policy Matter Opinion Nos. 03-2012 dated 30 November 2012 and 02-2013 dated 11 April 2014, as well as the case of Philippine Sports Commission, et. al. vs. Dear John Services, Inc. (G.R. No. 183260 dated 4 July 2012), we are of the opinion that Section 4 of DOLE DO No. 150-16, insofar as it imposes a minimum administrative fee of 20% of the total contract cost for Service Agreement for security services, likewise runs counter to the provision of Section 31 of Republic Act No. 9184 and its 2016 Revised Implementing Rules and Regulations.