Our DOLE D.O. 174 registration service provides the essential legal framework for individuals and entities seeking to operate as legitimate contractors and subcontractors. We offer technical and legal guidance to satisfy the rigorous capitalization and operational standards and ensure your business is fully insulated from the risks of labor-only contracting.
What You Should Know About DOLE DO 174 Registration
Contracting is an arrangement whereby a principal agrees to farm out to a contractor the performance or completion of a specific job or work within a definite or predetermined period, regardless of whether such job or work is to be performed or completed within or outside the premises of the principal. Subcontracting, on the other hand, is working with a contractor to get a portion of the contracted job or work done.
The DOLE Department Order No. 174, Series of 2017 (DOLE DO 174) is a department order issued by the Department of Labor and Employment (DOLE) to provide an additional set of guidelines governing contracting and subcontracting in the Philippines.
The order mandates all persons and entities acting as contractors and subcontractors to register with DOLE consistent with the authority to restrict and prohibit the contracting out of labor and to protect the rights of workers. Failure to register gives rise to the presumption of engagement in labor-only contracting.
What Duran & Duran-Schulze Law Does
As a specialist in Philippine labor regulations, Duran & Duran-Schulze Law serves as a strategic compliance partner, ensuring your contracting business is duly registered and strictly adheres to the statutory standards of the DOLE.
We perform a comprehensive legal assessment of capitalization, service agreements, and employment contracts to effectively insulate the business and principals from the risks of labor-only contracting and secondary liability.
Our DOLE DO 174 Registration Assistance
We provide a comprehensive legal path to securing and maintaining your legitimate contractor status:
Substantial Capitalization and Financial Audit
We review financial statements to ensure that applicants meet the mandatory PHP 5,000,000 minimum paid-up capital (or net worth) required by D.O. 174. We also advise on corporate structuring and equity adjustments.
Clearance Processing
Critical to the registration process is proving the absence of labor disputes. We manage the application for Certificate of No Pending Case from the Department of Labor and Employment (DOLE) and National Labor Relations Commission (NLRC).
Document Preparation and Filing
We manage the entire application folder, from filling out application forms to securing the registration certificate. We ensure all documents are properly authenticated and submitted to the appropriate DOLE Regional Office.
Service Agreement and Contract Review
We also draft and review service agreements between contractors and principals to ensure they contain the mandatory provisions required by law, specifically emphasizing the right of control cause.
How to Get Started
For inquiries on requirements, processes, and fees, contact Duran & Duran-Schulze Law at (+632) 8478 5826, (+63) 917 194 0482, or info@duranschulze.com, or simply complete the form on this page. Our office is located at 1210 High Street South Corporate Plaza Tower 2, 26th Street, Bonifacio Global City, Taguig, Metro Manila, Philippines.
Need to Consult a Lawyer?
You can book an online or in-person consultation with Atty. March. Choose a 30-minute or 1-hour session, fill out the form with your information and preferred schedule, pay the fee via PayPal, and meet with the attorney at the scheduled time.
Atty. Marie Christine Duran-Schulze
Managing Partner [Read Profile]
Business and Corporate Law, Family Law, Litigation, Immigration Laws, Real Estate, Labor Management, and HR Services
DOLE DO 174 Registration FAQs
For your reference and guidance, here are some frequently asked questions about DOLE DO 174 registration in the Philippines:
Prohibited under the law, labor-only contracting refers to arrangements where the contractor or subcontractor merely recruits, supplies, or places workers to perform a job, work, or service for a principal and the following elements are present:
- The contractor or subcontractor does not have (i) substantial capital or (ii) investment in the form of tools, equipment, machineries, work premises, among others, and (iii) the workers recruited and placed by such person are performing activities which are directly related to the principal business of such employer; or
- The contractor does not exercise the right of control over the performance of the work of the employees.
Here are the salient points in the DOLE DO 174:
- The registration fee of contractors has been increased to PHP 100,000 and the effectivity of the certificate of registration has been decreased to two years. The capitalization requirement of contractors has also been increased to PHP 5,000,000.
- Contracting out work through an in-house cooperative, which merely supplies workers to the principal, is a prohibited form of employment arrangement.
- Prohibition on requiring the contractor’s employees to perform functions that are currently being performed by regular employees of the principal.
- The mandatory provisions in a service agreement between a principal and contractor has been reduced and it is no longer required to include provisions on: (a) Net Financial Contracting Capacity; (b) ensuring compliance with all the rights and benefits of the employees under the Labor Code; and (c) the obligation of the contractor to directly remit the relevant contributions to the Social Security System, Employees Compensation Commission, Philippine Health Insurance Corporation, and the Home Mutual Development Fund.
- The termination of a service agreement between a principal and a contractor does not automatically result in the termination of the employment of the contractor’s employees.
Documentary requirements typically include completed application forms, sworn statements, business registration documents, financial statements, and DOLE clearance certificates.
The registration is filed with the Department of Labor and Employment (DOLE) Regional Office where the applicant principally operates via a Google Form available on its website. The actual license, however, shall be for pickup at the physical office at DOLE-NCR Building 967, Maligaya, Malate, Manila, 1004.
Aside from the official PHP 100,000 registration fee payable to DOLE, there are costs associated with securing government clearances and the preparation of verified financial records.
The DOLE Certificate of Registration shall be valid for two (2) years from the date of issuance unless canceled or revoked after due process.
The DOLE Regional Director, upon verified complaint, may cancel or revoke the registration of a contractor after due process, based on any of the following grounds:
- misrepresentation of facts in the application;
submission of falsified or tampered application or supporting documents to the application for registration; - non-submission of service agreement between the principal and the contractor when required to do so;
- non-submission of the required semi-annual report
- final findings that the contractor has engaged in labor-only contracting and/or other illicit forms of employment arrangements
- non-compliance with labor standards and working conditions;
- findings of violations of rights of contractor’s employees and required contracts;
- non-compliance with SSS, PhilHealth, Pag-IBIG Fund, and ECC Laws
- collecting any fees not authorized by law and other applicable rules and regulations; and,
- violations of any provisions of the Labor Code.
