Senator Erwin Tulfo files bill protecting workers from job loss due to AI adoption

A Philippine senator has filed legislation requiring employers to meet strict conditions before terminating workers whose roles are eliminated by artificial intelligence. Senate Bill 2563, introduced by Senator Erwin Tulfo, would amend the Labor Code to establish a legal framework for AI-related redundancies and mandate at least six months' advance notice to the Department of Labor and Employment (DOLE).

"As companies adopt AI, employees whose jobs become redundant risk losing not only their employment but also their means of supporting their families," said Tulfo, who chairs the Senate Committee on Social Justice, Welfare and Rural Development. "Technological progress is inevitable, but Filipino workers should not be left behind or made to bear its costs alone."

Conditions employers must meet before termination

The bill proposes a new article in the Labor Code specifying five conditions that must be satisfied before an employer can terminate workers due to AI or automation. The introduction or implementation of the technology must be bona fide and done in good faith. The employer must have a valid and justifiable purpose - such as reducing costs, improving operational efficiency, or achieving other legitimate economic objectives. The company must also demonstrate that no reasonable alternative to AI implementation exists other than terminating the affected employees. Finally, employers must apply fair and reasonable criteria in selecting which workers will be let go.

These provisions aim to prevent companies from using AI as a pretext for workforce reductions that could be achieved through retraining or reassignment. The requirement to prove an absence of alternatives places the burden on employers to explore options before resorting to termination.

Separation pay and notice requirements

Workers who are justifiably terminated under the proposed rules would receive separation pay equivalent to at least two months' pay or two months' pay for every year of service - whichever amount is higher. Employers planning terminations must also notify DOLE at least six months before the layoffs take effect, giving regulators and workers advance warning of workforce changes driven by automation.

"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," Tulfo said.

Why this matters for government, HR, and legal professionals

For HR and legal teams operating in the Philippines, this bill signals a potential shift toward codified AI redundancy procedures rather than leaving such decisions to general labor law provisions. If passed, compliance would require documenting the business rationale for AI adoption, exhausting alternatives to termination, and establishing transparent selection criteria - all well before any layoff announcement. Government policy professionals tracking AI governance in Southeast Asia will find the bill's emphasis on mandated notice periods and enhanced separation pay a concrete example of how legislatures are attempting to balance technological adoption with worker protection. Professionals involved in workforce planning or regulatory compliance may want to monitor the bill's progress and consider how its requirements could shape redundancy planning. For those building expertise in this area, structured learning paths such as AI Public Policy Courses and AI Regulatory Compliance Courses offer frameworks for understanding the intersection of automation and labor regulation.