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The following post does not create a lawyer-client relationship between Alburo Alburo and Associates Law Offices (or any of its lawyers) and the reader. It is still best for you to engage the services of a lawyer or you may directly contact and consult Alburo Alburo and Associates Law Offices to address your specific legal concerns, if there is any.
Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.
AT A GLANCE:
The Republic Act No. 7686, otherwise known as the Dual Training System Act of 1994, was enacted to strengthen manpower education and training in the country so that the latter may be assured of an ever growing supply of an educated and skilled manpower equipped with appropriate skills and desirable work habits and attitudes. (Section 2, Republic Act No. 7686)
Dual Training System
The Dual Training System refers to an instructional delivery system of technical and vocational education and training that combines in-plant training and in-school training based on a training plan collaboratively designed and implemented by an accredited dual system educational institution/training center and accredited dual system agricultural, industrial and business establishments with prior notice and advise to the local government unit concerned. Under this system, said establishments and the educational institution share the responsibility of providing the trainee with the best possible job qualifications, the former essentially through practical training and the latter by securing an adequate level of specific, general and occupation-related theoretical institution. The word “dual” refers to the two parties providing instruction: the concept “system” means that the two instructing parties do not operate independently of one another, but rather coordinate their efforts. (Section 4(a), Republic Act No. 7686)
Coverage
The Dual Training System Act shall apply to all public and private educational institutions/training centers and agricultural, industrial and business establishments duly accredited to participate in dual training system. (Section 6, Republic Act No. 7686)
Status of Trainee
For the duration of the training under the System, the trainee is to be considered not an employee of the business/industrial establishment but rather a trainee of both the Accredited Dual Training System Educational Institution and the agricultural, industrial and business establishments: Provided, That, the union or the workers of the latter have been duly informed in advance of such an agreement.
A trainee who has successfully completed a training program in a particular agricultural, industrial or business establishment shall be given priority of employment in that agricultural, industrial or business establishment. The appropriate authority shall keep a roll of these successful trainees for purposes of identifying them for employment. (Section 8, Republic Act No. 7686)
Incentives for Participating Establishments
To encourage agricultural, industrial and business establishments to participate in the System, they shall be allowed to deduct from their taxable income the amount of fifty percent (50%) of the system expenses paid to the Accredited Dual Training System Educational Institution for the establishment’s trainees: Provided, That such expenses shall not exceed five percent (5%) of their total direct labor expenses but in no case to exceed Twenty-five million Pesos (PhP25,000,000) a year.
Donations for the operation of the System shall be deductible from the taxable income of the donors.
The Department of Finance shall issue the necessary rules and regulations for the purpose of tax incentives provided herein. (Section 9, Republic Act No. 7686)
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Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries regarding legal services, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/ 09175772207/ 09778050020.
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