A senator in the Philippines filed a bill this week that would make AI-driven layoffs the most expensive kind of layoff in the country. It is worth reading even if you never hire there, because it is the first national attempt to write AI dismissal into a labour code with numbers attached.
Senate Bill No. 2563 was filed on 8 November 2026 by Senator Erwin Tulfo, who chairs the Senate committee on social justice, welfare and rural development. It adds a new article to the Labor Code setting the conditions under which a dismissal caused by AI or automation can be lawful.
What the bill would require
- The AI system must actually be introduced or implemented. A pilot or a slide deck does not count.
- The employer must act in good faith, for a valid purpose such as cost reduction or efficiency.
- Layoffs must be the last resort, after reskilling and redeployment.
- The workers selected must be chosen on fair and reasonable criteria.
- The Department of Labor and Employment must be notified at least six months before terminations.
- Separation pay must be at least two months' salary, or two months' salary per year of service, whichever is higher.
Existing redundancy rules require one month's notice to DOLE and separation pay of at least one month's salary per year of service. The bill doubles the pay floor, multiplies the notice by six, and adds obligations with no equivalent today: proof of reskilling, proof the AI is real, and mandatory consultation.
The two numbers that matter
Six months and two months. For a worker with ten years in the role, two months per year of service is 20 months' salary — usually enough to make a company think twice before cutting a person and buying a licence instead. For the employer, six months means the decision to deploy AI and the decision to cut headcount cannot be the same meeting.
Why the Philippines first
The country is one of the largest suppliers of outsourced business services in the world: support, back office, transcription. Those are exactly the tasks AI tooling has been aimed at. Philippine labour law has detailed rules for redundancy and retrenchment, but none written with a system that absorbs a task as its central fact. The bill closes that gap by squeezing AI into the authorised-causes framework.
It cuts the other way too. Raising the cost of AI dismissal in Manila does not stop automation in Ohio, but it changes the arithmetic for companies that moved work there.
What the US and UK do instead
The American approach ignores the cause. WARN gives 60 days' written notice before a mass layoff or plant closing at a site with 100 or more employees, where a mass layoff means an employment loss for at least 33% of active employees and at least 50 people in 30 days, or 500 or more. WARN does not care whether the reason is a downturn or a model. Most AI cuts fall below both floors and owe nothing beyond contractual notice.
California is the one state naming AI in the paperwork. Senate Bill 951, effective 1 January 2027, requires disclosure when a Cal-WARN layoff is caused in whole or in substantial part by AI. The 60-day notice and the 75-employee threshold stay; what changes is that the notice must say automation is part of why the roles are going.
The UK does it with consultation instead of cause. Under TULRCA 1992, an employer proposing 20 or more redundancies at one establishment within 90 days must start collective consultation at least 30 days before the first dismissal, or 45 days for 100 or more. Twenty people is far easier to reach than a third of a site.
Three systems, three philosophies
| Jurisdiction | Trigger | Notice | Does AI change it |
|---|---|---|---|
| US federal (WARN) | 100+ employees, mass layoff | 60 days | No, cause-blind |
| California | 75+ employees | 60 days | Disclosure from 1 Jan 2027 |
| United Kingdom | 20+ redundancies in 90 days | 30 or 45 days | No, consultation applies regardless |
| Philippines (current) | Redundancy as authorised cause | 1 month | No AI article |
| Philippines (SB 2563) | AI or automation dismissal | 6 months to DOLE | Yes, with reskilling conditions |
The takeaway
The bill is not law. It has to pass committee, plenary and the House, and Philippine bills change shape on that road. But it is the first serious attempt to write AI dismissal into a labour code with numbers attached, and it will be the reference point for the next country that tries.
The full comparison, with exact thresholds and what to ask an employer who names AI in a layoff, is on the site: AI layoff laws in the US, UK and Philippines, compared. The bill itself, with the conditions in full: Philippines bill: six months' notice before AI layoffs.
Originally published at voxahq.in.
Top comments (0)