A. FUNDAMENTAL PRINCIPLES AND POLICIES 1. Constitutional Provisions a.

Article II - Declaration of Principles and State Policies The State shall promote a just and dynamic social order that will ensure the prosperity and independence of the nation and free the people from poverty through policies that provide adequate social services, promote full employment, a rising standard of living, and an improved quality of life for all.1 The State shall promote social justice in all phases of national development.2 The State values the dignity of every human person and guarantees full respect for human/rights.3 The State recognizes the vital role of the youth in nation-building and shall promote and protect their physical, moral, spiritual, intellectual, and social well-being. It shall inculcate in the youth patriotism and nationalism, and encourage their involvement in public and civic affairs.4 The State recognizes the role of women in nation-building, and shall ensure the fundamental equality before the law of women and men.5 The State affirms labor as a primary social economic force. It shall protect the rights of workers and promote their welfare.6 The State recognizes the indispensable role of the private sector, encourages private enterprise, and provides incentives to needed investments.7 b. Article III Bill of Rights No person shall be deprived of life, liberty, or property without due process of law, nor shall any person be denied the equal protection of the laws. 8 No law shall be passed abridging the freedom of speech, of expression, or of the press, or the right of the people peaceably to assemble and petition the government for redress of grievances.9
1 2

Sec. 9 Sec.10 3 Sec.11 4 Sec. 13 5 Sec. 14 6 Sec. 18 7 Sec. 20 8 Sec. 1.

The right of the people, including those employed in the public and private sectors, to form unions, associations, or societies for purposes not contrary to law shall not be abridged.10 c. Article XIII The Congress shall give highest priority to the enactment of measures that protect and enhance the right of all the people to human dignity, reduce social, economic, and political inequalities, and remove cultural inequities by equitably diffusing wealth and political power for the common good. To this end, the State shall regulate the acquisition, ownership, use, and disposition of property and its increments.11 The promotion of social justice shall include the commitment to create economic opportunities based on freedom of initiative and self-reliance.12 The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all. It shall guarantee the rights of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted activities, including the right to strike in accordance with law. They shall be entitled to security of tenure, humane conditions of work, and a living wage. They shall also participate in policy and decision-making processes affecting their rights and benefits as may be provided by law. The State shall promote the principle of shared responsibility between workers and employers and the preferential use of voluntary modes in settling disputes, including conciliation, and shall enforce their mutual compliance therewith to foster industrial peace. The State shall regulate the relations between workers and employers, recognizing the right of labor to its just share in the fruits of production and the right of enterprises to reasonable returns to investments, and to expansion and growth.13 The State shall protect working women by providing safe and healthful working conditions, taking into account their maternal functions, and such facilities and opportunities that will enhance their welfare and enable them to realize their full potential in the service of the nation.14

Sec. 4. Sec. 8. 11 Sec. 1. 12 Sec. 2. 13 Sec. 3. 14 Sec. 14.

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2. New Civil Code The relations between capital and labor are not merely contractual. They are so impressed with public interest that labor contracts must yield to the common good. Therefore, such contracts are subject to the special laws on labor unions, collective bargaining, strikes and lockouts, closed shop, wages, working conditions, hours of labor and similar subjects.15 3. Labor Code The State shall afford protection to labor, promote full employment, ensure equal work opportunities regardless of sex, race or creed and regulate the relations between workers and employers. The State shall assure the rights of workers to self- organization, collective bargaining, security of tenure, and just and humane conditions of work.16 A. It is the policy of the State: (a) To promote and emphasize the primacy of free collective bargaining and negotiations, including voluntary arbitration, mediation and conciliation, as modes of settling labor or industrial disputes; (b) To promote free trade unionism as an instrument for the enhancement of democracy and the promotion of social justice and development; (c) To foster the free and voluntary organization of a strong and united labor movement; (d) To promote the enlightenment of workers concerning their rights and obligations as union members and as employees; (e) To provide an adequate administrative machinery for the expeditious settlement of labor or industrial disputes; (f) To ensure a stable but dynamic and just industrial peace; and (g) To ensure the participation of workers indecision and policy-making processes affecting their rights, duties and welfare. B. To encourage a truly democratic method of regulating the relations between the employers and employees by means of agreements freely entered into through collective
15 16

Art. 1700 Art. 3

bargaining, no court or administrative agency or official shall have the power to set or fix wages, rates of pay, hours of work or other terms and conditions of employment, except as otherwise provided under this Code.17 Definitions. Commission The National Labor Relations Commission or any of its divisions, as the case may be. The Bureau of Labor Relations and/or the Labor Relations Divisions in the regional offices established under Presidential Decree No. 1, in the Department of Labor. The National Conciliation and Mediation Board established under Executive Order No. 126. The Tripartite Voluntary Arbitration Advisory Council established under Executive Order No. 126, as amended. Includes any person acting in the interest of an employer, directly or indirectly. The term shall not include any labor organization or any of its officers or agents except when acting as employer. Includes any person in the employ of an employer. The term shall not be limited to the employees of a particular employer, unless the Code so explicitly states. It shall include any individual whose work has ceased as a result of or in connection with any current labor dispute or because of any unfair labor practice if he has not obtained any other substantially equivalent and regular employment. Any union or association of employees which exists in whole or in part for the purpose of collective bargaining or of dealing with employers concerning terms and conditions of employment.

Bureau

Board

Council

Employer

Employee

Labor organization

17

Art. 211

Legitimate labor organization

Any labor organization duly registered with the Department of Labor and Employment, and includes any branch or local thereof. Any labor organization whose formation, function or administration has been assisted by any act defined as unfair labor practice by this Code. A legitimate labor organization whether or not employed by the employer. Any unfair labor practice as expressly defined by the Code. Includes any controversy or matter concerning terms and conditions of employment or the association or representation of persons in negotiating, fixing, maintaining, changing or arranging the terms and conditions of employment regardless of whether the disputants stand in the proximate relation of employer and employee. One who is vested with the powers or prerogatives to lay down and execute management policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees Those who, in the interest of the employer, effectively recommend such managerial actions if the exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment. All employees not falling within any of the above definitions. Any person accredited by the Board as such or any person named or designated in the Collective Bargaining Agreement by the parties to act as their Voluntary Arbitrator, or one chosen with or without the assistance of the National Conciliation and Mediation Board, pursuant to a selection procedure agreed upon in the Collective
5

Company union

Bargaining representative

Unfair labor practice Labor dispute

Managerial employee

Supervisory employees

Rank-and-file employees

Voluntary Arbitrator

Bargaining Agreement, or any official that may be authorized by the Secretary of Labor and Employment to act as Voluntary Arbitrator upon the written request and agreement of the parties to a labor dispute. Strike Any temporary stoppage of work by the concerted action of employees as a result of an industrial or labor dispute. Any temporary refusal of an employer to furnish work as a result of an industrial or labor dispute. Includes all disputes or grievances arising from any violation of or disagreement over any provision of the constitution and by-laws of a union, including any violation of the rights and conditions of union membership provided for in this Code Any person who obstructs, impedes, or interferes with by force, violence, coercion, threats, or intimidation any peaceful picketing affecting wages, hours or conditions of work or in the exercise of the right of self-organization or collective bargaining. The establishment, warehouses, depots, plants or offices, including the sites or premises used as runaway shops, of the employer struck against, as well as the immediate vicinity actually used by picketing strikers in moving to and fro before all points of entrance to and exit from said establishment.18

Lockout

Internal union dispute

Strike-breaker

Strike area

The labor organization designated or selected by the majority of the employees in an appropriate collective bargaining unit shall be the exclusive representative of the employees in such unit for the purpose of collective bargaining. However, an individual employee or group of law to the contrary notwithstanding, workers shall have the right, subject to such rules and regulations as the Secretary of Labor and Employment may promulgate, to participate in policy and decision-making processes of the establishment where they are employed insofar as said processes will directly affect their rights, benefits and welfare.
18

Art. 212

For this purpose, workers and employers may form labor-management councils: Provided, That the representatives of the workers in such labor-management councils shall be elected by at least the majority of all employees in said establishment.19

19

Art. 255

B. RECRUITMENT AND PLACEMENT 1. Recruitment of Local and Migrant Workers a. Recruitment and placement;20 defined 1. Any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers; and 2. Includes referrals, contact services, promising or advertising for employment, locally or abroad, whether for profit or not.21 Any person or entity which, in any manner, offers or promises for a fee employment to 2 or more persons22 is deemed engaged in recruitment and placement b. Illegal Recruitment23 Under the Labor Code: Any recruitment activities, including the prohibited practices enumerated under Article 3424 of this Code, to be undertaken by non-licensees or non-holders of authority. Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense involving economic sabotage. Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring and/or confederating with one another in carrying out any unlawful or illegal transaction, enterprise or scheme. Illegal recruitment is deemed committed in large scale if committed against three (3) or more persons individually or as a group.25

20

Some relevant principles: Mere impression that recruiter is capable of providing work abroad is sufficient. "Referral" of recruits also constitutes recruitment activity. Absence of receipt to prove payment is not essential to prove recruitment. Only one (1) person recruited is sufficient to constitute recruitment. Non-prosecution of another suspect is not material. A person convicted for illegal recruitment may still be convicted for estafa 21 Art. 13 [b] 22 Ibid. 23 Art. 38 (Local), Sec. 6, Migrant Workers Act, R.A. 8042 24 See Reference 25 Art. 38

Under R.A. 804226 Any act of canvassing, enlisting, contracting, transporting, utilizing, hiring, or procuring workers and includes referring, contract services, promising or advertising for employment abroad, whether for profit or not, when undertaken by non-licensee or nonholder of authority.27 Any such non-licensee or non-holder28 who, in any manner, offers or promises for a fee employment abroad to two or more persons shall be deemed so engaged. It shall likewise include the following acts, whether committed by any person, whether a non-licensee, non-holder, licensee or holder of authority: (a) To charge or accept directly or indirectly any amount greater than that specified in the schedule of allowable fees prescribed by the Secretary of Labor and Employment, or to make a worker pay or acknowledge any amount greater than that actually received by him as a loan or advance; (b) To furnish or publish any false notice or information or document in relation to recruitment or employment; (c) To give any false notice, testimony, information or document or commit any act of misrepresentation for the purpose of securing a license or authority under the Labor Code, or for the purpose of documenting hired workers with the POEA, which include the act of reprocessing workers through a job order that pertains to nonexistent work, work different from the actual overseas work, or work with a different employer whether registered or not with the POEA; (d) To include or attempt to induce a worker already employed to quit his employment in order to offer him another unless the transfer is designed to liberate a worker from oppressive terms and conditions of employment; (e) To influence or attempt to influence any person or entity not to employ any worker who has not applied for employment through his agency or who has formed, joined or supported, or has contacted or is supported by any union or workers' organization; (f) To engage in the recruitment or placement of workers in jobs harmful to public health or morality or to the dignity of the Republic of the Philippines; (h) To fail to submit reports on the status of employment, placement vacancies, remittance of foreign exchange earnings, separation from jobs, departures and such other matters or information as may be required by the Secretary of Labor and Employment;
26 27

as amended by R.A. 10022 under Art. 13 (f) 28 Any person, corporation or entity: 1. Which has not been issued a valid license or authority to engage in recruitment and placement by the Secretary of Labor and Employment (SLE) or 2. Whose license or authority has been suspended, revoked or cancelled by the POEA or the SLE

(i) To substitute or alter to the prejudice of the worker, employment contracts approved and verified by the Department of Labor and Employment from the time of actual signing thereof by the parties up to and including the period of the expiration of the same without the approval of the Department of Labor and Employment; (j) For an officer or agent of a recruitment or placement agency to become an officer or member of the Board of any corporation engaged in travel agency or to be engaged directly or indirectly in the management of travel agency; (k) To withhold or deny travel documents from applicant workers before departure for monetary or financial considerations, or for any other reasons, other than those authorized under the Labor Code and its implementing rules and regulations; (l) Failure to actually deploy a contracted worker without valid reason as determined by the Department of Labor and Employment; (m) Failure to reimburse expenses incurred by the worker in connection with his documentation and processing for purposes of deployment, in cases where the deployment does not actually take place without the worker's fault. Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense involving economic sabotage; and (n) To allow a non-Filipino recruitment/manning agency. citizen to head or manage a licensed

Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring or confederating with one another. It is deemed committed in large scale if committed against three (3) or more persons individually or as a group. (a) License29 vs. Authority License Authority

A document issued by the Department of A document issued by the Department of Labor authorizing a person or entity to Labor authorizing a person or association to operate a private employment agency. engage in recruitment and placement activities as a private recruitment entity.
29

No license or authority shall be used directly or indirectly by any person other than the one in whose favor it was issued or at any other place other than that stated in the license or authority, nor may such license or authority be transferred, conveyed or assigned to any other person or entity. Licensees or holders of authority or their duly authorized representatives may, as a rule, undertake recruitment and placement activities only at their authorized official addresses. Change of ownership or relationship of single proprietorship licensed to engage in overseas employment shall cause the automatic revocation of the license.

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(b) Essential elements of illegal recruitment 1. Offender is a nonlicensee or nonholder of authority to lawfully engage in the recruitment/placement of workers 2. Offender undertakes: a. Any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, and includes referrals, contact services, promising or advertising for employment, locally or abroad, whether for profit or not;30 or b. Any of the prohibited practices under Art. 34.31 (c) Simple illegal recruitment When it involves less than three (3) victims or recruiters. (d) Illegal recruitment in large scale32 (e) Illegal recruitment as economic sabotage When it is committed:: By a syndicate In large scale

If carried out by a group of 3 or more If committed against 3 or more persons persons conspiring and confederating with individually or as a group one another;

30 31

Art. 13[b] supra 32 infra

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(f) Illegal Recruitment vs. Estafa33 Illegal recruitment Malum prohibitum, thus: 1. Criminal intent is not necessary 2. A crime which involves moral turpitude Estafa Malum in se,thus: 1. Criminal intent is necessary 2. A crime which involves moral turpitude

It is not required that it be shown that the Accused defrauded another by abuse of recruiter wrongfully represented confidence, or by means of deceit.35 34 himself as a licensed recruiter. Illegal recruitment and estafa cases may be filed simultaneously or separately. The filing of charges for illegal recruitment does not bar the filing of estafa, and vice versa. Double jeopardy will not set in

(g) Liabilities (a) Local employment agency (b) Foreign employer They are jointly and severally liable for any violation of the recruitment agreement and the contracts of employment.36

33

under Art. 315, par. 2, RPC. Estafa is committed by any person who defrauds another by using fictitious name, or falsely pretends to possess power, influence, qualifications, property, credit, agency, business or imaginary transactions, or by means of similar deceits executed prior to or simultaneously with the commission of fraud (People v. Comila, G.R. No. 171448, February 28, 2007, 517 SCRA 153, 167) 34 It is enough that the victims were deceived as they relied on the misrepresentation and scheme that caused them to entrust their money in exchange of what they later discovered was a vain hope of obtaining employment abroad. 35 It is essential that the false statement or fraudulent representation constitutes the very cause or the only motive which induces the complainant to part with the thing of value. 36 This joint and solidary liability imposed by law against recruitment agencies and foreign employers is meant to assure the aggrieved worker of immediate and sufficient payment of what is due him. If the recruitment/placement agency is a juridical being, the corporate officers and directors and partners as the case may be, shall themselves be jointly and solidarily liable with the corporation or partnership for the claims and damages. (Becmen Service Exporter and Promotion v. Cuaresma, G.R. Nos. 18297879, April 7, 2009)

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i. Theory of imputed knowledge37 A rule in insurance law that any information material to the transaction, either possessed by the agent at the time of the transaction or acquired by him before its completion, is deemed to be the knowledge of the principal, at least so far as the transaction is concerned, even though in fact the knowledge is not communicated to the principal at all.38 Ascribes the knowledge of the agent to the principal employer, not the other way around.39 (h) Pretermination of contract of migrant worker Rules on Repatriation of Overseas Workers: Without fault of the worker His repatriation shall be borne by the local agency and/or principal over the 1. worker and his personal belongings; 2. remains of the deceased worker and his personal belongings.40 Fault of the migrant worker In cases of war, epidemic, calamities, or other similar events Shall be borne by the migrant worker41 disasters, Shall be borne by OWWA, without prejudice to reimbursement by the principal or local agency.42 Shall be mandatory upon discovery, done by the responsible officers of the foreign service where the underage migrant worker is found.43 POPEA Memo Circular No. 55-96 provides

Underage migrant worker

Seafarer
37 38

knowledge of the agent is knowledge of the principal. Leonor v. Filipinas Compania, 48 OG 243 39 Rovels Enterprises, Inc. v. Ocampo, G.R. No. 136821, October 17, 2002, 391 SCRA 176; vide Air France v. Court of Appeals, et al., 211 Phil. 601 (1983). 40 Sec. 15, par. 1, R.A. 8042 41 Ibid. 42 id. Par. 2 43 Sec. 16, id.

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that a seaman can be repatriated without cause if the vessel arrives at a convenient port within three (3) months before the expiration of his contract, but only upon payment of a. all his earned wages; b. leave pay for the entire contract; c. termination pay of one (1) month basic salary, if seaman has at least ten (10) months original contract.44

c. Direct hiring45 General Rule: An employer may only hire Filipino worker for overseas employment through POEA or entities authorized by DOLE. Exceptions: Direct hiring by 1. International organizations 2. Members of the diplomatic corps; 3. Name hires; and 4. Such other employers as may be allowed by the Dept. of Labor.

44 45

PCL Shipping Pils. vs.NLRC, 511 SCRA 44 (2006) It is when an employer hires a Filipino worker for overseas employment without going through the POEA or entities authorized by the Secretary of Labor. Employers cannot directly hire workers for overseas employment except through authorized entities duly authorized by POEA as follows: a. public employment offices; b. Philippine Overseas Employment Administration (POEA); c. private recruitment entities; d. private employment agencies; e. shipping or manning agents or representatives; f. such other persons or entities as may be authorized by the Secretary of Labor and Employment; and g. construction contractors.

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2. Regulation and Enforcement a. Remittance of foreign exchange earnings General Rule: It shall be mandatory for all OFWs to remit a portion of their foreign exchange earnings to their families, dependents, and/or beneficiaries ranging from 50% 80% depending on the workers kind of job.46 Exceptions: 1. The workers immediate family members, beneficiaries and dependents are residing with him abroad 2. Immigrants and Filipino professionals and employees working with the UN agencies or specialized bodies 3. Filipino servicemen working in U.S. military installations.47 b. Prohibited activities48 1. Furnishing or publishing any false notice/information/document related to recruitment/employment 2. Failure to file reports required by SLE 3. Inducing or attempting to induce a worker already employed to quit his employment in order to offer him another unless the transfer is designed to liberate a worker from oppressive terms and conditions 4.Recruitment/placement of workers in/jobs harmful to public health or morality or to the dignity of the country 5. Engaging directly or indirectly in the management of a travel agency 6. Substituting or altering employment contracts without approval of DOLE 7.Charging or accepting any amount greater than that specified by DOLE or make a worker pay any amount greater than actually received by him 8. Committing any act of misrepresentation to secure a license or authority

46 47

Rule VIII, Book III, POEA Rules Resolution No. 183, InterAgency Committee for Implementation of E.O. 857 48 Art. 34

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9.Influencing or attempting to influence any person/entity not worker who has not applied of employment through his agency atives

to

employ

any

10.Obstructing or attempting to obstruct inspection by SLE or by his represent

11.Withholding or denying travel documents from applicant workers before departure for monetary considerations other than authorized by law 12.Granting a loan to an OFW which will be used for payment of legal and allowable placement fees 13.Refusing to condone or renegotiate a loan incurred by an OFW after his employment contract has been prematurely terminated through no fault of his or her Own. 14. For a suspended recruitment/manning agency to engage in any kind of recruitment activity including the processing of pending workers' applications; and 15.For a recruitment/manning agency or a foreign principal/employer to pass on the OFW or deduct from his or her salary the payment of the cost of insurance fee, premium or other insurance related charges, as provided under the compulsory wor ker's insurance coverage 16.Imposing required to: persons a compulsory and exclusive arrangement whereby an OFW is

a. Avail a loan only from specifically designated institutions, entities or

b.To undergo health examinations only from specifically designated medical, entities or persons, except seafarers whose medical examination cost is shouldered by the shipowner c. To undergo training of any kind only from designated institutions, entities or persons, except for recommendatory trainings mandated by principals /shipowners.49

49

Sec. 6, R.A. 10022

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c. Regulatory and visitorial powers of the Labor Secretary Regulatory powers Visitorial powers

1.Restrict and regulate the recruitment and 1. Access to employers records and placement activities of all agencies premises at any time of the day or night, whenever work is being undertaken 2. Issue orders and promulgate rules and regulations 2. To copy from said records 3.Question any employee and investigate any fact, condition or matter which may be necessary to determine violations or which may aid in the enforcement of the Labor Code and of any labor law, wage order, or rules and regulation issued pursuant thereto. d. Penalties for illegal recruitment50 Offender / Offense Penalty IR as economic sabotage Provided: 1. If person illegally recruited is below 18 years of age or 2. Illegal recruitment is committed by a non licensee/nonholder Any person found guilty of illegal recruitment 12 yrs. and 1 day 20 yrs. imprisonment; or Fine: P1MP2M Any person found guilty of the prohibited acts 6 yrs. and 1 day 12 yrs. imprisonment; or Fine of P500K P1M Penalty Life imprisonment fine of P2MP5M +

Maximum penalty shall be imposed

50

under R.A. 10022

17

Licensee/holder of authority violates provisions Alien Nonlicensee/nonholder of authority violates provisions

25 yrs imprisonment; or Fine: P10K P50K;

48 yrs imprisonment; or Fine: P20K P100K

Corporation, partnership, association, or entity Penalty imposed upon officer/s responsible for violation Alien Penalties prescribed under R.A. 10022, + Deportation without further proceedings Automatic revocation of license or authority and all permits and privileges of the recruitment or manning agency, lending institutions, training school or medical clinic.

In every case

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C. LABOR STANDARDS 1. Hours of Work51 a. Coverage/Exclusions Coverage Exclusions

Employees in all establishments and 1. Government employees, undertakings, whether for profit or not. 2. Managerial employees,52 3. Field personnel,53 4. Members of the family of the employer who are dependent on him for support, domestic helpers, 5. Persons in the personal service of another, and 6. Workers who are paid by results
51

Work day" means 24 consecutive-hour period which commences from the time the employee regularly starts to work. It does not necessarily mean the ordinary calendar day from 12:00 midnight to 12:00 midnight unless the employee starts to work at this unusual hour. "Work week" is a week consisting of 168 consecutive hours or 7 consecutive 24-hour work days beginning at the same hour and on the same calendar day each calendar week. Reduction of eight-hour working day - not prohibited by law provided there is no reduction in pay of workers. Hours of work of part-time workers - payment of wage should be in proportion only to the hours worked. 52 Those whose primary duty consists of the management of the establishment in which they are employed or a department or subdivision thereof, and other officers or members of the managerial staff. They must meet all of the ff. conditions, namely: 1.Primary duty: management of the establishment in which they are employed or of a department or subdivision thereof; 2. Customarily or regularly direct the work of 2 or more employees 3.Has the authority to hire or fire other employees of lower rank; or their suggestions and recommendations as to the hiring and firing and as to the promotion or any change of status of other employees are given particular weight. 4.Execute under general supervision work along specialized or technical lines requiring special training, experience, or knowledge 5. Execute under general supervision special assignment and tasks; and 6. Do not devote more than 20% of their hours worked to activities which are not directly and closely related to performance of the work described. (Art. 82[2]) 53 Non-agricultural employees who regularly perform their duties away from the principal place of business or branch office of the employer and whose actual hours of work in the field cannot be determined with reasonable certainty

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b. Normal Hours of Work Eight (8) hours per day in a general working day. 1. Exceptions Health Personnel54 1. Health personnel in cities and municipalities with a population of at least 1 million; or Compressed Work Week55

The normal workweek is reduced to less than 6 days but the total number of Work hours of 48 hours per week shall remain. The normal workday is increased to 2.Hospitals and clinics with a bed capacity more than 8 hours but not to exceed of at least 100 12 hours, without corresponding overtime premium. The concept can be adjusted General Rule: accordingly depending on the normal workweek of the company.57 56 8 hours/5 days, exclusive of time for meals. Exceptions Where the exigencies of the service require that such personnel work for 6 days or 48 hours, they shall be entitled to an additional compensation of at least 30% of their regular wage for work on the 6th day.

54

Include resident physicians, nurses, nutritionists, dietitians, pharmacists, social workers, laboratory technicians, paramedical technicians, psychologists, midwives, attendants and all other hospital or clinic personnel 55 See shortening of work week (under 1. Hours of Work), supra 56 40hour work week Does not apply if there is a training agreement between the resident physician and the hospital and the training program is duly accredited or approved by appropriate government agency. 57 Department Advisory Order No. 2, Series of 2009

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2. Work interruption due to brownouts a. Brown-outs of short duration not exceeding twenty (20) minutes - compensable hours worked whether used productively by the employees or not. b. Brown-outs running for more than twenty (20) minutes may not be treated as hours worked provided any of the following conditions are present: 1. The employees can leave their workplace or go elsewhere whether within or without the work premises; or 2. The employees can use the time effectively for their own interest. c. In each case, the employer may extend the working hours of his employees outside the regular schedules to compensate for the loss of productive man hours without being liable for OT pay. d. Industrial enterprises with 1 or 2 work shifts may adopt any of the work shift prescribed for enterprises with 3 work shifts to prevent serious loss or damage to materials, machineries, or equipment that may result case of power interruptions.58 3. Meal Break Every employee is entitled to not less than one (1) hour (or 60 minutes) time-off for regular meals. Being time-off, it is not compensable hours worked and employee is free to do anything he wants, except to work. If he is required to work while eating, he should be compensated therefor. If meal time is shortened to not less than twenty (20) minutes - compensable hours worked. If shortened to less than 20 minutes - considered coffee break or rest period of short duration and, therefore, compensable.

58

Policy Instruction No. 36

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4. Idle time, waiting time, commuting time, travel time, whether part of hours of work or not Idle time Waiting time Travel time time, commuting

Not working time; it is not Considered compensable if compensable.59 waiting is an integral part of the employee's work or he is Except: required or engaged by the employer to wait. When the employee is idle or inactive by reason of interruptions beyond his control -considered working time.

a. Travel from home to work - not compensable working time b. Travel that is all in the days work - compensable hours worked. c. Travel away from home compensable hours worked.

59

e.g. Stiller works as a Partas Trans bus driver. His route is from Vigan to Baguio, leaving at 6am and arriving at 12nn. He is completely relieved from all duty until 6pm, when he again goes on duty for the return trip to Vigan. Is his idle time working time? No, because during his idle time, he is specifically relieved from all duty. He is merely waiting to be engaged.

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5. Overtime work60 Work beyond eight(8) hours of work within the workers 24 hour workday.61 Undertime not offset by overtime Waiver of overtime pay

Undertime work on any particular day shall The right of the laborers to overtime pay not be offset by overtime on any other day.62 cannot be waived.63 Where a worker incurs undertime hours during his regular daily work, said undertime hours should not be offset against the overtime hours on the same day or on any other day. It is both prohibited by the statute and by jurisprudence.

60

General Rule: No employee may be compelled to render overtime work against his will. Exceptions: a. When the country is at war or when any other national or local emergency has been declared by the National Assembly or the Chief Executive b. When overtime work is necessary to prevent loss of life or property or in case of imminent danger to public safety due to actual or impending emergency in the locality caused by serious accident, fire, floods, typhoons, earthquake, epidemic or other disasters or calamities; c. When there is urgent work to be performed on machines, installations or equipment, or in order to avoid serious loss or damage to the employer or some other causes of similar nature d. When the work is necessary to prevent loss or damage to perishable goods; e. When the completion or continuation of work started before the 8th hour is necessary to prevent serious obstruction or prejudice to the business or operations of the employer; and f. When overtime work is necessary to avail of favorable weather or environmental conditions where performance or quality of work is dependent thereon. When an employee refuses to render emergency overtime work under any of the foregoing conditions, he may be dismissed on the ground of insubordination or willful disobedience of the lawful order of the employer. 61 In computing overtime work, "regular wage" or "basic salary" means "cash" wage only without deduction for facilities provided by the employer. "Premium pay" means the additional compensation required by law for work performed within 8 hours on non- working days, such as rest days and special days. "Overtime pay" means the additional compensation for work performed beyond 8 hours. Every employee entitled to premium pay is also entitled to the benefit of overtime pay. 62 Sec. 88 63 It is governed by law and not merely by the agreement of the parties.

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c. Night Work Any and all work rendered between 6:00 pm and 6:00 am.64 d. CBA provision vis--vis overtime work Generally, the premium for work performed on the employees rest days or on special days or regular holidays are included as part of the regular rate of the employee in the computation of overtime pay for any overtime work rendered on said days especially if the employer pays only the minimum overtime rates prescribed by law. The employees and employer, however, may stipulate in their collective agreement the payment of overtime rates higher than those provided by law and exclude the premium rates in the computation of overtime pay. Such agreement may be considered valid only if the stipulated overtime pay rates will yield to the employees not less than the minimum prescribed by law.

64

National Rice & Corn Corp. v. NARIC, 105 Phil 891

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2. Wages65 a. "No work no pay" principle66 Actual work is the basis of claim for wages. General Rule: If there is no work performed by the employee, without the fault of the emp loyer, there can be no wage or pay. Exceptions: The laborer was able, willing and ready to work but was: 1. Prevented by management; 2. Illegally locked out; 3. Illegally suspended; 4. Illegally dismissed 5. Otherwise illegally prevented from working.67

65

Under the Civil Code, it is mandated that the laborers wages shall be paid in legal currency. Under the Labor Code and its implementing rules, as a general rule, wages shall be paid in legal tender and the use of tokens, promissory notes, vouchers, coupons or any other form alleged to represent legal tender is prohibited even when expressly requested by the employee Exceptions : A. Payment through automated teller machine (ATM) of banks provided the following conditions are met: 1. the ATM system of payment is with the written consent of the employees concerned; 2. The employees are given reasonable time to withdraw their wages from the bank facility which time, if done during working hours, shall be considered compensable hours worked; 3. The system shall allow workers to receive their wages within the period or frequency and in the amount prescribed under the Labor Code, as amended; 4. There is a bank or ATM facility within a radius of one (1) kilometer to the place of work; 5. Upon request of the concerned employee/s, the employer shall issue a record of payment of wages,benefits and deductions for a particular period; 6. There shall be an additional expenses and no diminution of benefits and privileges as a result of the ATM system of payment; 7. The employer shall assume responsibility in case the wage protection provisions of law and regulations are not complied with under the arrangement 66 applies to special days but not to unworked regular holidays where employees are always paid 100% of their basic pay. 67 Aklan Electric Coop. v. NLRC, G.R. No. 129246, Jan. 25, 2000

25

b. Coverage/Exclusions Coverage It applies to all employees Exclusions 1. Farm tenancy or leasehold; 2.Household or domestic helpers, including family drivers and persons working in the personal service of another; 3.Home workers engaged in needlework or in any cottage industry duly registered in accordance with law; 4. Workers in duly registered cooperatives when so recommended by the Bureau of Cooperative Development and upon approval of the Secretary of Labor and Employment. 5. Workers of a barangay micro business Enterprise.68

c. Facilities69 vs. supplements Facilities Items of expenses necessary for the laborers and his familys existence and subsistence but does not include tools of the trade or articles or services primarily for the benefit of the employer or necessary to the conduct of the employers business. Supplements Extra remuneration or special privileges or benefits given to or received by the laborers over and above their ordinary earnings or wages.70

Forms part of the wage

Independent of wage

68 69

R.A. 9178 Value of facilities - the fair and reasonable value of board, lodging and other facilities customarily furnished by an employer to his employees both in agricultural and non-agricultural enterprises In order that the cost of facilities furnished by the employer may be charged against an employee, his acceptance of such facilities must be voluntary (Sec. 7, Rule VII, Book III, Rules to Implement the Labor Code) 70 Atok Big Wedge Mining Co. v. Atok Big Wedge Mutual Benefit Assoc., G.R. No. L7349, July 19, 1955

26

Deductible from wage For the benefit of the worker and his family. d. Wages vs. salaries Wages

Not wage deductible Granted for the convenience of the employer.

Salaries

Compensation for manual labor71 Paid to white collared workers and denotes also known as blue collared workers, paid a higher degree of employment, or a at stated times and measured by the day, superior grade of services, and implies a week, month or season. position in office. Indicates inconsiderable pay for a lower or Suggests a larger and more permanent or less responsible character of employment. fixed compensation for more important services. General Rule: Not subject to execution Exceptions: Debts incurred for food, shelter, clothing and medical attendance. e. Wage distortion72 A situation where an increase in prescribed wage rates results in the elimination or severe contraction of intentional quantitative differences in wage or salary rates between and among employee groups in an establishment as to effectively obliterate the distinctions
71 72

Subject to execution

skilled or unskilled Elements: 1. An existing hierarchy of positions with corresponding salary rates. 2. A significant change or increase in the salary rate of a lower pay class without a corresponding increase in the salary rate of a higher one; 3. The elimination of the distinction between the 2 groups or classes; and 4. The WD exists in the same region of the country (Alliance Trade Unions v. NLRC, G.R. No. 140689, Feb. 17, 2004)

27

embodied in such wage structure based on skills, length of service, or other logical bases of differentiation. The issue of whether or not a wage distortion exists is a question of fact that is within the jurisdiction of the quasi- judicial tribunals. f. CBA vis--vis Wage Orders CBA creditability CBA Wage order

Not an ordinary contract. It can be Administrative issuance which results from entered into only by an exclusive a statute.73 bargaining agent or unit. If the CBA provides better benefits, then the employees shall be entitled to the same. Only sets the minimum

A CBA provision regarding wages prevails over a Wage Order where the CBA provides a wage or salary to be received by the employees which is more than the amount set by the Wage Order, whether issued prior to or after the conclusion of the CBA. It is incumbent upon the employer to compensate the employees according to the provisions of the CBA with respect to wages. g. Non-diminution of benefits74 This principle mandates that the reduction or diminution or withdrawal by employers of any benefits, supplements or payments as provided in existing laws, individual agreements or collective bargaining agreements between workers and employers or voluntary employer practice or policy, is not allowed.75 The benefits being given to employees cannot be taken back or reduced unilaterally by the employer because the benefits have become part of the employment contract, written or unwritten.76

73 74

R.A. 6727 The rule is applicable if it is shown that the grant of the benefits is: Based on an express policy; or Has ripened into practice over a long period of time, The practice is consistent and deliberate; and It is not due to an error in the construction/ application of a doubtful or difficult question of law. 75 See Art. 100 76 Exception: To correct an error, otherwise, if the error is not corrected for a reasonable time, it ripens into a company policy and employees can demand it as a matter of right.

28

h. Workers preference in case of bankruptcy 1. Declaration of bankruptcy or judicial liquidation before enforcement of the workers preferential right; 2. Filing of claims by workers; 3. The right does not constitute a lien to the property of the insolvent debtor in favor of workers.77 4. The preference in favor of the employees applies to discharge of funds. The preference does not only cover unpaid wages, it also extends to termination pay and other monetary claims;78 5. Applicable only to ordinary preferred credit, hence, must yield to special preferred credits. i. Labor Code provisions for wage protection No employer shall limit or otherwise interfere with the freedom of any employee to dispose of his wages. He shall not in any manner force, compel or oblige his employees to purchase merchandise, commodities or other properties from the employer or from any other person, or otherwise make use of any store or service of such employer or any other person.79 No employer in his own behalf or in behalf of any person, shall make any deduction from the wages of his employees, except: (a) In cases where the worker is insured with his consent by the employer, and the deduction is to recompense the employer for the amount paid by him as premium on the insurance; (b) For union dues, in cases where the right of the worker or his union to check off has been recognized by the employer or authorized in writing by the individual worker concerned; and (c) In cases where the employer is authorized by law or regulations issued by the Secretary of Labor.80

77 78

DBP vs. NLRC, G.R. No. 82763 Mar. 19, 1990 and G.R. No. 97176, Mar. 18, 1993 Termination pay, after all, is considered as additional remuneration for services rendered to the employer for a certain period of time; it is computed on the basis of length of service. (PNB vs. Cruz, G.R. No. 80593, Dec. 18, 1989) 79 Art. 112. 80 Art. 113

29

No employer shall require his worker to make deposits from which deductions shall be made for the reimbursement of loss of or damage to tools, materials or equipments supplied by the employer; except when the employer is engaged in such trades, occupations or business where the practice of making deductions or requiring deposits is a recognized one, or is necessary, or desirable as determined by the Secretary of Labor in appropriate rules and regulations.81 No deduction from the deposits of an employee for the actual amount of the loss ordamage shall be made unless the employee has been heard thereon, and his responsibility has been clearly shown.82 amount from the wages of a worker or induce him to give up any part of his wages by force, stealth, intimidation, threat or by any other means whatsoever without the workers consent.83 It shall be unlawful to make any deduction from the wages of any employee for the benefit of the employer or his representative or intermediary as consideration of a promise of employment or retention in employment or retention in employment.84 It shall be unlawful for an employer to refuse to pay or reduce the wages and benefits, discharge or in any manner discriminate against any employee who has filed any complaint instituted any proceeding under this Title or has testified or is about to testify in such proceedings.85 It shall be unlawful for any person, directly or indirectly, to withhold any

81 82

Art. 114 Art. 115 83 Art 116 84 Art 117 85 Art. 118

30

j. Allowable deductions without employees consent General Rule It is strictly prohibited Exceptions 1. Deductions86 for insurance premiums 2. Union dues in cases where the right of the worker or his union to check off has been recognized by the employer or authorized in writing by the individual worker concerned.87 Art. 241(o) provides that special assessments may be validly checked-off provided that there is an individual written authorization duly signed by every employee. 3. Deductions for SSS, Medicare and Pagibig premiums 4. Taxes withheld pursuant to the Tax Code 5. Deductions for loss or damage to tools, materials or equipments 6. Deductions made with the written authorization of the employee for payment to a third person.88 7. Deductions as disciplinary measures for habitual tardiness.89 8. Agency fees90 9. Deductions for value of meals and facilities freely agreed upon 10. In case where the employee is indebted to the employer where such indebtedness has become due and demandable.91 11.In court awards, wages may be subject of execution or attachment, but only for debts incurred for food, shelter, clothing, and medical attendance.92
86 87

under Art. 113 ibid. 88 Sec 13, Rule VIII, Book III of the IRR 89 Opinion dated March 10, 1975 of the SLE 90 under Art. 248(e) 91 Art. 1706, NCC 92 Art. 1703, id.

31

12. Salary deduction of a member of a legally established cooperative.93 k. Attorneys fees and union service fee in labor cases Attorneys fees Union service fee

1.In case of unlawful withholding of wages The appearance of labor federations and local unions as counsel in labor proceedings has been given legal sanction96 10% of the amount of wages to be which allows non-lawyers to represent recovered. their organization thereof. The said labor federations and local unions have a valid 2. It shall be unlawful for any person to claim to attys fees which is called the demand or accept94 attys fees that exceed Union Service Fee. 10% of the amount of wages recovered.95 l. Criteria/Factors for Wage Setting a) The demand for living wages; b) Wage adjustment vis--vis the consumer price index; c) The cost of living and changes or increases therein; d) The needs of workers and their families; e) The need to induce industries to invest in the countryside; f) Improvements in standards of living;

g) The prevailing wage levels; h) Fair return of the capital invested and capacity to pay of employers; i) Effects on employment generation and family income; and

93 94

R.A. 6938, Art. 59 in any judicial or administrative proceedings for the recovery of wages 95 The prohibition on attys lien refers to proceedings for recovery of wages and not to services rendered in connection with CBA negotiations. In the latter case, the amount of attys fees may be agreed upon by the parties and the same is to be charged against union funds as provided for in Art. 222 of the Labor Code (Pacific Banking Corp. v. Clave, G.R. No. 56965, Mar. 7, 1984). 96 under Art.222 of the LC

32

j) The equitable distribution of income and wealth along the imperatives of economic and social development97 3. Rest Day a. Right to weekly rest day Every employer, whether operating for profit or not, shall provide each of his employees a rest period of not less than twenty-four (24) consecutive hours after every six (6) consecutive normal work days. The employer shall determine and schedule the weekly rest day of his employees subject to collective bargaining agreement and to such rules and regulations as the Secretary of Labor and Employment may provide b. Preference of the employee The employer shall respect the preference of employees as to their weekly rest day when such preference is based on religious grounds. c. When work on rest day authorized 1. Actual or impending emergencies caused by serious accident, fire, flood, typhoon, earthquake, epidemic or other disaster or calamity to prevent loss of life and property, or imminent danger to public safety; 2. Urgent work to be performed on the machinery, equipment, or installation, to avoid serious loss which the employer would otherwise suffer; 3. Abnormal pressure of work due to special circumstances, where the employer cannot ordinarily be expected to resort to other measures; 4. To prevent loss or damage to perishable goods; 5. The nature of the work requires continuous operations and the stoppage of work may result in irreparable injury or loss to the employer; and 6. Other analogous or similar circumstances as determined by the Secretary of Labor and Employment.98

97 98

See Art. 124 Art. 92

33

4. Holidays a. Right to holiday pay99 (1) In case of absences LoA100 with pay on the day immediately preceding a RH101 General Rule: All covered holiday pay. employees LoA without pay on the day immediately preceding a RH General Rule: are entitled to An employee may not be paid the required holiday pay if he has not worked on such regular holiday. Exception: Where the day immediately preceding the holiday is a: 1. Nonworking day in the establishment or 2. The scheduled rest day of the employee. (2) In case of temporary cessation of work Instances 1. Yearly inventory or 2. When the repair machineries is undertaken or cleaning Rule RH falling within the period shall be of compensated.

3. Due to business reverses

RH may not be paid by the employer

99

Art. 94 It is a premium given to employees pursuant to law even if he has not been suffered to work on a regular holiday. It is limited to the 11 regular holidays, also called legal holidays listed by law. The employee should not have been absent without pay on the working day preceeding the regular holiday. Every worker shall be paid his regular daily wage during regular holidays. The employer may require an employee to work on any holiday but such employee shall be paid a compensation equivalent to twice his regular rate; 100 Leave of Absence 101 Regular Holiday

34

(3) Of teachers, piece workers, seafarers, seasonal workers, etc. Employees Private school teachers102 Rule 1. RH during semestral vacations - Not entitled to HP 2. RH during Christmas vacation - Shall be paid HP Paid by: 1. results or 2. output103 Seasonal Workers HP shall not be less than his average daily earnings for the last 7 actual work days preceding the RH; Provided: HP shall not be less than the statutory minimum wage rate.

May not be paid the required HP during offseason where they are not at work. Shall be entitled to HP

Workers having no regular work days Seafarers

Shall be entitled to HP b. Exclusions from coverage

In retail and service establishments regularly employing less than ten (10) workers.

102 103

Faculty members of colleges and universities Piece work payment

35

5. Leaves a. Service Incentive Leave Pay104 (1) Right to service incentive leave Every employee who has rendered at least one (1) year of service105 shall be entitled to a yearly service incentive leave of five (5) days with pay. (2) Exclusions from coverage a. Government employees and any of its political subdivisions, including GOCCs b. Those already enjoying the benefit c. Domestic helpers and persons in the personal services of another d. Those already enjoying vacation leave with pay of at least 5 days e. Managerial employees f. Field personnel and other employees whose performance is unsupervised by the employer g. Employed in establishments regularly employing less than 10 workers h. Exempt establishments i. Engaged on task or contract basis, purely commission basis, or those who are paid in a fixed amount of performing work irrespective of the time consumed in the performance thereof.106

104

It is 5 days leave with pay for every employee who has rendered at least 1 yr. of service. It is commutable to its money equivalent if not used or exhausted at the end of year. 105 Service for not less than 12 months, whether continuous or broken reckoned from the date the employee started working, including authorized absences and paid regular holidays unless the working days in the establishment as a matter of practice or policy, or that provided in the employment contract is less than 12 months, in which case said period shall be considered as one year. (Sec. 3, Rule V, Book III, IRR) 106 Art. 95[b]

36

(3) Commutable nature of benefit It is commutable to cash if unused at the end of the year. b. Maternity Leave107 (1) Coverage A covered female employee who has paid at least three (3) monthly maternity contributions in the twelve (12)-month period preceding the semester of her childbirth, abortion or miscarriage and who is currently employed.108 (2) Conditions to entitlement a. The employee shall have notified her employer of her pregnancy and the probable date of her childbirth which notice shall be transmitted to the SSS in accordance with the rules and regulations it may provide; b. Payment shall be advanced by the employer in two equal installments within thirty (30) days from the filing of the maternity leave application; c. In case of caesarian delivery, the employee shall be paid the daily maternity benefit for 78 days; d. Payment of daily maternity benefits shall be a bar to the recovery of sickness benefits provided by this Act for the same compensable period of sixty (60) days for the same childbirth, abortion or miscarriage; e. The maternity benefits shall be paid only for the first four deliveries after March 13, 1973; f. The SSS shall immediately reimburse the employer of one hundred percent (100%) of the amount of maternity benefits advanced to the employee by the employer upon receipt of satisfactory proof of such payment and legality thereof g. If an employee should give birth or suffer abortion or miscarriage without the required contributions having been remitted for her by her employer to the SSS, or without the latter having been previously notified by the employer of the time of the pregnancy, the
107

Maternity benefits, like other benefits granted by the SSS, are granted to employees in lieu of wages and, therefore, may not be included in computing the employees 13th-month pay for the calendar year. Voluntary or self-employed members are not entitled to the maternity benefit because to be entitled thereto, corresponding maternity contributions should be paid by employers. Voluntary or self-employed members have no employers so they do not have maternity contributions. 108 Shall be paid a daily maternity benefit equivalent to one hundred percent (100%) of her present basic salary, allowances and other benefits or the cash equivalent of such benefits for 60 days or 78 days in case of caesarian delivery. .

37

employer shall pay to the SSS damages equivalent to the benefits which said employee would otherwise have been entitled to, and the SSS shall in turn pay such amount to the employee concerned.109 (3) Availment Every pregnant woman in the private sector, whether married or unmarried, is entitled to the maternity leave benefits.110 c. Paternity Leave111 (1) Coverage Granted to a married male employee in the private and public sector allowing him not to report for work for seven (7) days but continues to earn the compensation therefor. (2) Conditions to entitlement The male employee is 1. Legally married to, and is cohabiting with the woman who delivers the baby 2. Employee of private or public sector; and 3. Only for the first 4 deliveries112 of legitimate spouse with whom he is cohabiting;

4.Notify his employer of the pregnancy of his legitimate spouse and the expec ted date of such delivery (3) Availment113 The paternity benefits may be enjoyed by the qualified employee before, during or after the delivery by his wife. However, the total number of days shall not exceed seven (7) working days for each delivery. This benefit shall be availed of not later than sixty (60) days after the date of said delivery.

109 110

R. A. 7322, March 3, 1992. see also Coverage, supra 111 It is not convertible to cash if not availed of. 112 include childbirth or any miscarriage 113 see also (1) Coverage, supra

38

d. Parental Leave114 (1) Coverage Leave benefits of not more than seven (7) working days every year granted to a solo parent115 employee to enable him/her to perform parental duties and responsibilities where physical presence is required. (2) Conditions to entitlement 1. He or she must fall among those referred to as solo parent 2. Must have the actual and physical custody of the child or children 3. Must have at least rendered service of one (1) year to his or her employer 4. He or she must remain a solo parent

114

Republic Act No. 8972 (An Act Providing for Benefits and Privileges to Solo Parents and Their Children, Appropriating Funds Therefor and for Other Purposes), otherwise known as The Solo Parents Welfare Act of 2000. This leave privilege is an additional leave benefit which is separate and distinct from any other leave benefits provided under existing laws or agreements 115 Any individual who falls under any of the ff. categories: 1. A woman who gives birth as a result of rape and other crimes against chastity even without a final conviction of the offender, provided, That the mother keeps and raises the child; 2. Parent left solo or alone with the responsibility of parenthood due to: a. Death of spouse; b. Detention or service of sentence of spouse for a criminal conviction for at least 1 yr; c. Physical and/or mental incapacity of spouse d. Legal separation or de facto separation from spouse for at least 1 yr as long as he/she is entrusted with the custody of the children; e. Nullity or annulment of marriage as decreed by a court or by a church as long as he/she is entrusted with the custody of the children; f. Abandonment of spouse for at least 1 yr; 3. Unmarried mother/father who has preferred to keep and rear his or her child/children instead of: a. having others care for them or b. give them up to a welfare institution; 4. Any other person who solely provides: a. parental care and b. support to a child or children; 5. Any family member who assumes the responsibility of head of family as a result of the: a. death, b. abandonment, c. disappearance or d. prolonged absence of the parents or solo parent. A change in the status or circumstance of the parent claiming benefits under this Act, such that he/she is no longer left alone with the responsibility of parenthood, shall terminate his/her eligibility for these benefits. (Sec.3)

39

(3) Availment116 e. Leaves for victims of violence against women117 (1) Coverage (2) Conditions to entitlement (3) Availment A female employee who is a victim of violence118 is entitled to a paid leave of 10 days in addition to other paid leaves, extendible when the necessity arises as specified in the protection order.119 6. Service Charges a. Coverage These are charges collected by hotels, restaurants and similar establishments and shall be distributed at the rate of: Covered Employees 85% Equally distributed among them Management 15% 1. To answer for losses and breakages and 2. Distributed to employees receiving more than P2000 a month at the discretion of the management. b. Exclusion120 Managerial employees.121 c. Distribution122 The share of the employee shall be distributed and paid to them not less than once every 2 weeks or twice a month at intervals not exceeding 16 days.

116 117

see (1) Coverage, supra under R.A. 9262 118 physical, sexual, or psychological 119 st Sec. 43, 1 par., ibid 120 See A. Coverage 121 Sec. 2, Rule VI, Book III, IRR 122 ibid

40

d. Integration123 If the service charge is abolished, the share of the covered employees shall be considered integrated in their wages on the basis of the average monthly share of each employees for the past 12 months immediately preceding the abolition. 7. Thirteenth (13th) Month Pay and other bonuses a) Coverage All rank-and-file employees are entitled to a 13th-month pay124 regardless of the amount of basic salary that they receive in a month, if their employers are not otherwise exempted from paying the 13th month pay. Such employees are entitled to the 13th month pay regardless of their designation or employment status, and irrespective of the method by which their wages are paid, provided that they have worked for at least one (1) month during a calendar year.125 b) Exclusion/Exemptions from coverage 1. Government employees 2. Household helpers 3. Employees paid purely on commission basis 4. Employees already receiving 13th month pay c) Nature of 13th month pay It is in the nature of wages. This is a year-end pay established by P.D. 851 which is equivalent to 1/12 of the total basic salary earned by an employee within the calendar year, which is demandable as a legal obligation. It may be given anytime but not later than December 24.

123 124

ibid Forms: Christmas bonus; Midyear bonus; Profit sharing payments; and Other cash bonuses amounting to not less than1/12 of its basic salary 125 Revised Guidelines on the Implementation of the 13 Month Pay Law

41

d) Commissions vis--vis 13th month pay The salesmans commissions, comprising a pre-determined percent of the selling price of the goods sold by each salesman, were properly included in the term basic salary for purposes of computing their 13th month pay. e) CBA vis--vis 13th month pay The absence of an express provision in the CBA obligating the employer to pay the members of a union 13th month pay is immaterial. Notwithstanding therefore the absence of any contractual agreement, the payment of a 13th month pay being a statutory grant, compliance with the same is mandatory and is deemed incorporated in the CBA. 8. Women Workers a. Discrimination sex With respect to the terms and conditions of employment solely on account of

1. Payment of lesser compensation to a female employee as against a male employee for work of equal value 2. Favoring a male employee with respect to promotion, training opportunities, study and scholarship grants on account of gender.126 3. Favoring a male applicant with respect to hiring where the particular job can equally be handled by a woman 4. Favoring a male employee over a female employee with respect to dismissal of personnel.127 b. Stipulation against marriage Whether as a condition of employment or continuation of employment 1. A woman employee shall not get married, or 2. Upon getting married, a woman employee shall be deemed resigned or separated, or to actually dismiss, discharge, discriminate or otherwise prejudice a woman employee merely by reason of her marriage.128

126 127

Art. 135 st Ibid., 1 par. 128 Art.136

42

c. Prohibited Acts 1. Denying any woman employee the benefits provided for by law or to discharge any woman employed by him for the purpose of preventing her from enjoying any of the benefits provided for by law. 2. Discharging such woman on account of her pregnancy, or while on leave or in confinement due to her pregnancy; 3. Discharging or refusing the admission of such woman upon returning to her work for fear that she may again be pregnant.129 d. Classification of certain women workers Any woman who is permitted or suffered to work 1. with or without compensation, 2. in any nightclub, cocktail lounge, massage clinic, bar or similar establishments of time 3. under the effective control or supervision of the employer for a substantial period

4. shall be considered as an employee of such establishment for purposes of labor and social legislation.130

A woman worker may not be dismissed on the ground of dishonesty for having written single on the space for civil status on the application sheet, contrary to the fact that she was married. (PT&T Co. v. NLRC, G.R. No. 118978, May 23, 1997) 129 Art. 137 130 Art. 138

43

e. Anti-Sexual Harassment Act131 The Act punishes sexual harassment if the same is: 1. work-related; or 2. Education-related; or 3. training-related.132 Sexual harassment may be committed by an: 1. Employee 2. Manager 3. Supervisor 4. Agent of the employer 5. Teacher, instructor, professor 6. Coach, trainer, or 7. Any other person who, having authority, influence or moral ascendancy over another in a work or training or education environment: a. Demands b. Requests or c. Requires any sexual favor from the other, regardless of whether the demand, request or requirement for submission is accepted by the object of R.A.8777.133

131

R.A. 7877 - declares sexual harassment unlawful in the employment, education or training environment. 132 Sec. 3, id. 133 ibid. It is not necessary that the demand, request or requirement of a sexual favor be articulated in a categorical manner. It may be discerned, with equal certitude, from the acts of the offender. Likewise, it is not essential that the demand request or requirement be made as a condition for continued employment or for promotion to a higher position. It is enough that the respondents acts result in creating an intimidating, hostile or offensive environment for the employee. (Domingo v. Rayala, G.R. No. 155831, Feb. 18, 2008)

44

9. Minor Workers134 a. Regulation of working hours of a child135 General Rule 1. No person under 18 years of age will be allowed to be employed in an undertaking which is hazardous or deleterious in nature. Exceptions A. Below 15 yrs. Old

1. The child works directly under the sole responsibility of his parents, or 2. No employer shall discriminate against guardians who employ members of any person in respect to terms and his family, subject to the following conditions of employment on account of his conditions: age. a. Employment does not endanger the childs safety, health and morals b. Employment does not impair the childs normal devt. c. Employerparent or legal guardian provides the child with the primary and/or secondary education prescribed by the Dept. of Education 2. The childs employment or participation in public entertainment or information through cinema, theater, radio or television is essential provided: a. Employment contract is concluded by the childs parents or legal guardian, b. With the express agreement of the child concerned, if possible, and c. The approval of DOLE, the following must be complied with: i. The employment does not involve advertisement or commercials promoting alcoholic beverages, intoxicating drinks, tobacco and its by
134 135

R.A. 7678, R.A. 9231 The term "child" shall apply to all persons under eighteen (18) years of age.

45

products or exhibiting violence ii. there is a written contract approved by DOLE iii. the conditions provided in the first instance are met. B. Above 15 but below 18 may be employed in any nonhazardous work C. Above 18 no prohibition

1. A child below fifteen (15) years of age136 may be allowed to work for not more than twenty (20) hours a week: Provided, That the work shall not be more than four (4) hours at any given day; 2. A child fifteen (15) years of age but below eighteen (18) shall not be allowed to work for more than eight (8) hours a day, and in no case beyond forty (40) hours a week; 3. No child below fifteen (15) years of age shall be allowed to work between eight o'clock in the evening and six o'clock in the morning of the following day and no child fifteen (15) years of age but below eighteen (18) shall be allowed to work between ten o'clock in the evening and six o'clock in the morning of the following day. 137
136

Children below fifteen (15) years of age shall not be employed except: (1) When a child works directly under the sole responsibility of his/her parents or legal guardian and where only members of his/her family are employed: Provided, however, That his/her employment neither endangers his/her life, safety, health, and morals, nor impairs his/her normal development: Provided, further, That the parent or legal guardian shall provide the said child with the prescribed primary and/or secondary education; or (2) Where a child's employment or participation in public entertainment or information through cinema, theater, radio, television or other forms of media is essential: Provided, That the employment contract is concluded by the child's parents or legal guardian, with the express agreement of the child concerned, if possible, and the approval of the Department of Labor and Employment: Provided, further, That the following requirements in all instances are strictly complied with: (a) The employer shall ensure the protection, health, safety, morals and normal development of the child; (b) The employer shall institute measures to prevent the child's exploitation or discrimination taking into account the system and level of remuneration, and the duration and arrangement of working time; and (c) The employer shall formulate and implement, subject to the approval and supervision of competent authorities, a continuing program for training and skills acquisition of the child. In the above exceptional cases where any such child may be employed, the employer shall first secure, before engaging such child, a work permit from the Department of Labor and Employment which shall ensure observance of the above requirements. (Section 12, R.A. No. 7610, as amended by R. A. No. 9231, December 19, 2003). 137 Sec. 12-A, R.A. No. 7610, as amended by R. A. No. 9231, December 19, 2003.

46

b. Employment of the child in public entertainment138 c. Prohibition of employing minors in certain undertakings and in certain advertisements No child shall be employed as a model in any advertisement directly or indirectly promoting alcoholic beverages, intoxicating drinks, tobacco and its byproducts, gambling or any form of violence or pornography.139 10. Employment of Househelpers 140 a. Definition Domestic or household service means service in the employers home which is usually necessary or desirable for the maintenance and enjoyment thereof and includes ministering to the personal comfort and convenience of the members of the employers household, including services of family drivers.141 b. Benefits accorded househelpers 1. SSS benefits for those who are receiving at least P1,000 per month.142 2. Entitled to minimum wage in addition to lodging, food, and medical attendance.143 3. If the househelper is under the age of eighteen (18) years, the employer shall give him or her an opportunity for at least elementary education. The cost of education shall be part of the househelpers compensation, unless there is a stipulation to the contrary.144

138 139

see Exceptions (2), supra. Sec. 14, R.A. No. 7610, as amended by R. A. No. 9231, December 19, 2003. 140 A househelper is synonymous to domestic servant 1. Any person, male or female; 2. Who renders services in and about the employers home and; 3. Services are usually necessary or Desirable for the maintenance and enjoyment thereof, and 4. Ministers exclusively to the personal comfort and enjoyment of employers family The children and relatives of a househelper who live under the employers roof and who share the accommodations provided for the househelper by the employer shall not be deemed as househelp ers if/they are not otherwise engaged as such and are not required to perform any substantial hous ehold work. (Sec 3, Rule XII, Book III, IRR) The definition of a househelper cannot be interpreted to include househelp or laundry women working in staffhouses of a company. (APEX Mining CO., Inc., v. NLRC, G.R. No. 94951, April 22, 1991) 141 nd Art. 141, 2 par. 142 Art. 143 143 Art. 144 144 Art. 146

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c. Termination The termination of the employment of a househelper should be: 1. Upon expiration of the term of employment, or 2. Based on just cause145 d. Reliefs for unjust termination Rules: 1. If the period for household service is fixed, neither the employer nor the househelper may terminate the contract before the expiration of the term except for just cause. 2. If the househelper is unjustly dismissed, he or she shall be paid the compensation already earned plus that for the 15 days by way of indemnity. 3. If the househelper leaves without justifiable reason, he or she shall forfeit any unpaid salary due him or her not exceeding 15 days. 11. Employment of Homeworkers a. Definition Homeworkers refer to workers who perform in or about their homes any processing of goods or materials in whole or in part which have been furnished directly or indirectly by an employer or contractor, and thereafter to be returned to the latter. The term does not include those situated within the premises or compound of an employer or contractor, where work performed therein is under the active or personal supervision by or for the latter. b. Rights and benefits accorded homeworkers i. The employer is required to pay the homeworker or the contractor or subcontractor for the work performed immediately upon receipt of the finished goods or articles. When payment is made to a contractor or sub-contractor, the homeworker shall be paid within one (1) week after the contractor or subcontractor has collected the goods or articles from the homeworker.146 ii. Whenever an employer contracts with a contractor in this regard, the employer should provide in such contract that the employees or homeworkers of the contractor and the latters subcontractor shall be paid in accordance with these regulations. In the event that such contractor or subcontractor fails to pay the wages or earnings of his employees or
145 146

Art. 149 Rule XIII, Book III, Secs. 3 & 4, OR

48

homeworkers, such employee shall be jointly and severally liable with the contractor or subcontractor to the workers of the latter, to the extent that the work is performed under such contract, in the same manner as if the employees or homeworkers were directly engaged by the employer.147 c. Conditions for deduction from homewokers earnings No deductions shall me made from the homeworkers earnings for the value of materials lost, destroyed, soiled or otherwise damaged unless the following conditions are met: a) the homeworker concerned is clearly shown to be responsible for the loss or damage: b) the employee is given reasonable opportunity to show cause why deductions should not be made: c) the amount of such deductions is fair and reasonable, and shall not exceed the actual loss or damage; and d) the deduction is made at such rate that the amount deducted does not exceed 20 percent of the homeworkers earnings in a week.148

147 148

ibid, Sec. 8, OR. Rule XIII, Sec. 5, OR. This is to ensure the homeworkers right to due process.

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12. Apprentices and Learners149 a. Distinctions between Learnership and Apprenticeship Learnership Nature Apprenticeship

Training on the job in semi-skilled and other industrial occupation or trades which are nonapprenticeable and which may be learned thru practical training on the job in a relatively short period of time.

Training in trades which are apprenticeable, that is, practical training on the job supplemented by related theoretical instruction for more than 3 months.

Duration of training With commitment to employ the learner as a regular employer if he desires upon completion of learnership. No commitment to hire

In case of pretermination of contract Worker not considered as regular employee. Considered a regular employee if pretermination occurs after 2 months of training and the dismissal is without fault of the learner. Coverage Semiskilled/Industrial occupations Highly technical industries and only in industrial occupation No list

There is a list of learnable trades by TESDA

Written agreement Require Learnership Agreement Requires Apprenticeship Agreement

149

Under R.A. 7277. Wage rate is 75% of the statutory minimum wage rate.

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13. Handicapped Workers 150 a. Definition of "handicapped workers" injury. One whose earning capacity is impaired by age, physical or mental deficiency; or b. Rights of disabled workers 1. Equal opportunity for employment 2.Sheltered employment151 3. Apprenticeship 4.Vocational rehabilitation152 5. Vocational guidance and counseling. Handicapped workers may be hired as apprentices or learners if their handicap is not such as to effectively impede the performance of job operations in the particular occupations for which they are hired. No disabled person shall be denied access to opportunities for suitable employment. Qualified disabled employees shall be subject to the same terms and conditions of employment and the same compensation, privileges, benefits, fringe benefits, incentives or allowances as a qualified able-bodied person. Even a handicapped worker can acquire the status of a regular employee if the factors that make for a regular employment are present, especially if his appointment was repeatedly renewed. 153

Apprentice - a worker who is covered by a written apprenticeship agreement with an employer Learner - a person hired as a trainee in industrial occupations which are non-apprenticeable and which may be learned through practical training on the job for a period not exceeding three (3) months, whether or not such practical training is supplemented by theoretical instructions. 150 Ibid If disability is not related to the work for which he was hired, he should not be so considered as handicapped worker. He may have a disability but since the same is not related to his work, he cannot be considered a handicapped worker insofar as that particular work is concerned. 151 The govt shall endeavor to provide them work if suitable employment for disabled persons cannot be found through open employment 152 means to develop the skills and potentials of disabled workers and enable them to compete in the labor market 153 Bernardo vs. NLRC, July 12, 1999 GR No. 122917

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c. Prohibitions on discrimination against disable persons No disable person shall be denied access to opportunities for suitable employ ment. A qualified disabled employee shall be subject to the same terms and conditions of employment and the same compensation, privileges, benefits, fringe benefits, incentives or allowances as a qualified able bodied person. Five percent (5%) of all casual emergency and contractual positions in the Departments of Social Welfare and Development; Health; Education, Culture and Sports; and other government agencies, office or corporations engaged in social development shall be reserved for disabled persons.154 d. Incentives for employers Entitled to an additional deduction, from their gross income, equivalent to twentyfive percent (25%) of the total amount paid as salaries and wages to disabled persons: Provided, however, That such entities present proof as certified by the Department of Labor and Employment that disabled persons are under their employ: Provided, further, That the disabled employee is accredited with the Department of Labor and Employment and the Department of Health as to his disability, skills and qualifications. Private entities that improve or modify their physical facilities in order to provide reasonable accommodation for disabled persons shall also be entitled to an additional deduction from their net taxable income, equivalent to fifty percent (50%) of the direct costs of the improvements or modifications. This does not apply to improvements or modifications of facilities required under Batas Pambansa Bilang 344.155

154

The Magna Carta strictly prohibits discrimination against a qualified disabled person, even as the law gives incentives to employers of disabled persons. 155 Sec. 8, R.A. 7277

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D. TERMINATION OF EMPLOYMENT 1. Employer-Employee Relationship a. Four-fold Test a. Selection and engagement of employee; b. Payment of wages; c. Power of dismissal; and d. Power of control156 b. Probationary Employment Employment where the employee, upon his engagement: 1. Is made to undergo a trial period 2. During which the employer determines his fitness to qualify for regular employment, 3. Based on reasonable standards made known to the employee at the time of engagement.157

156 157

the most important test Sec 6, Rule I, Book VI, IRR The services of an employee who has been engaged on probationary basis may be terminated only for just cause, when he fails to qualify as a regular employee in accordance with reasonable standards prescribed by the employer.

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c. Kinds of Employment (1) Regular employment158 Where: i. the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer. ii. the employee has rendered at least one (1) year of service, whether such service is continuous or broken, with respect to the activity in which he is employed and his employment shall continue while such activity exists. iii. the employee is allowed to work after a probationary period. (a) Reasonable connection rule The primary standard is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. If the employee has been performing the job for at least one year, even if the performance is not continuous or only intermittent, the law deems the repeated and continuing need for its performance as sufficient evidence of the necessity, if not indispensability, of the activity of the business159 The primary standard of determining regular employment is the reasonable connection between the particular activity performed by the employee in relation to the usual trade or business of the employer. Additionally, "an employee is regular because of the nature of work and the length of service, not because of the mode or even the reason for hiring them.160 The connection can be determined by considering the nature of the work performed and its relation to the scheme of the particular business or trade in its entirety.161

(2) Project employment162

158

Regularization is not a management prerogative; it is the nature of employment that determines it. It is a mandate of the law. (PAL v. Pascua, G.R. No. 143258, Aug. 15, 2003) Regular employment does not mean permanent employment. A probationary employee becomes a regular employee after 6 months. A regular employee may only be terminated for just/authorized causes. The practice of entering into employment contracts which would prevent the workers from becoming regular should be struck down as contrary to public policy and morals. (Universal Robina Corp. v. Catapang, G.R. No. 164736, Oct. 14, 2005) 159 International Pharmaceuticals, Inc. vs. NLRC, et al., March 9, 1998, 287 SCRA 213). 160 Matling Industrial and Commercial Corp. et al., v. Ricardo Coros, G.R. No. 157802, October 13, 2010) 161 Highway Copra Traders v. NLRC, G.R. No. 108889, July 30, 1998

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(a) Indicators of project employment i. The duration of the specific/identified undertaking for which the worker is engaged is reasonably determinable. ii. Such duration, as well as the specific work/service to be performed, is defined in an employment agreement and is made clear to the employee at the time of hiring. iii. The work/service performed by the employee is in connection with the particular project/undertaking for which he is engaged. iv. The employee, while not employed and awaiting engagement, is free to offer his services to any other employer. v. The termination of his employment in the particular project/undertaking is reported to the Department of Labor and Employment (DOLE) Regional Office having jurisdiction over the workplace within 30 days following the date of his separation from work, using the prescribed form on employees' terminations dismissals suspensions. vi. An undertaking in the employment contract by the employer to pay completion bonus to the project employee as practiced by most construction companies. (3) Seasonal employment Where the work or service to be performed by the employee is seasonal in nature and the employment is for the duration of the season. (4) Casual employment Where an employee is engaged to perform a job, work or service which is merely incidental to the business of the employer, and such job, work or service is for a definite period made known to the employee at the time of engagement. (5) Fixed term employment163 (a) Requisites for validity i. The fixed period was knowingly and voluntarily agreed upon by the parties. ii. The employer and the employee dealt with each other on more or less equal terms with no moral dominance being exercised by the employee 164
162

Where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee. 163 Not limited to those by nature, seasonal or for specific projects with pre-determined dates of completion provided under the Labor Code. They also include contracts to which the parties by free choice, have assigned a specific date of termination 164 Brent School Ruling.

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iii. It is not valid if it is apparent that periods have been imposed to preclude acquisition of tenurial security by the employee. d. Job contracting and Labor-only contracting (1) When is there "job contracting"? It refers to an arrangement whereby a principal agrees to put out or farm out with a contractor or subcontractor the performance or completion of a specific job, work or service within a definite or predetermined period, regardless of whether such job, work or service is to be performed or completed within or outside the premises of the principal. (2) When is there "labor-only contracting"? It refers to an arrangement where the contractor or subcontractor merely recruits, supplies or places workers to perform a job, work or service for a principal. (3) Conditions that must concur in legitimate job contracting i. The contractor or subcontractor does not have substantial capital or investment which relates to the job, work or service to be performed and the employees recruited, supplied or placed by such contractor or subcontractor are performing activities which are directly related to the main business of the principal; or ii. The contractor does not exercise the right to control over the performance of the work of the contractual employee.165 (4) Effects of finding that there is labor-only contracting i. The subcontractor will be treated as the agent or intermediary of the principal. Since the act of an agent is the act of the principal, representations made by the subcontractor to the employees will bind the principal. ii. The principal will become the employer as if it directly employed the workers engaged to undertake the subcontracted job or service. It will be responsible to them for all their entitlements and benefits under the labor laws. iii. The principal and the subcontractor will be solidarily treated as the employer. iv. The employees will become employees of the principal.166 If the labor-only contracting activity is undertaken by a legitimate labor organization, a petition for cancellation of union registration may be filed against it.167
165 166

Art. 106 No. 13, DOLE Primer on Contracting and Subcontracting, Effects of Department Order No. 3, Series of 2001. 167 Ibid.

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2. Termination of Employment a. Substantive Due Process (1) Just Causes (a) Serious misconduct168 or willful disobedience169 i. Requisites Serious misconduct 1. Must be serious or of such a grave and aggravate character; Willful disobedience

1. The employees assailed conduct must have been willful or intentional, the willfulness being characterized by a 2. Must relate to the performance of the wrongful and perverse attitude. employees duties; and 2.The disobeyed orders, regulations 3. Must show that the employee has become or instructions of the employer must be: unfit to continue working for the employer.170 a. Reasonable and lawful b. Sufficiently made known to the employee c. Must pertain to or be in connection with the duties which the employee has been engaged to discharge.171

168

Transgression of some established and definite rule of action, a forbidden act, a dereliction of duty, willful in character, and implies wrongful intent and not mere error in judgment. Grave and aggravated character and not merely trivial or unimportant; Must be in connection with the work of the employee. 169 Elements: Assailed conduct must have been willful or intentional, willfulness characterized by a wrongful, perverse mental attitude It must be established that the said orders, regulations or instructions are Reasonable and lawful Sufficiently known to the employee In connection with his duties 170 Philippine Aeolus Automotive United Corp. v. NLRC, G.R. No. 124617, April 28, 2000 171 Cosep v. NLRC, G.R. No. 124966 June 16, 1998

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(b) Gross and habitual neglect of duties Gross negligence Habitual Neglect

Implies a want or absence of or failure to Implies repeated failure to perform ones exercise slight care of diligence or the duties over a period of time, depending entire absence of care. It evinces upon the circumstance.173 thoughtless disregard of consequences without exerting any effort to avoid them. However, such neglect must not only be gross but habitual in character.172 i. Requisites174 (c) Fraud175 or willful breach of trust176 i. Requisites 1. The loss of confidence must not be simulated; 2. It should not be used as a subterfuge for causes which are illegal, improper or unjustified; 3. contrary; It may not be arbitrarily asserted in the face of overwhelming evidence to the

4. It must be genuine, not a mere afterthought, to justify earlier action taken in bad faith; and 5. The employee involved holds a position of trust and confidence.

172 173

Judy Phils. v. NLRC, G.R. No. 111934, April 29, 1998 JGB and Associates v. NLRC, GR No. 10939, Mar. 7, 1996 174 See table 175 Commission of fraud by an employee against the employer will necessarily result in the latter's loss of trust and confidence in the former. Proof of loss is not required under this ground. 176 loss of trust and confidence In order to constitute a just cause for dismissal, the act complained of should be work-related and must show that the employee concerned is unfit to continue to work for the employer.

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(d) Abandonment of employment; Elements that must concur 1. The failure to report for work or absence without valid or justifiable reason; and 2. A clear intention to sever the employer-employee relationship.177 (e) Termination of employment pursuant to a Union Security Clause178 Employer should still afford due process to the expelled unionists. Although the Supreme Court has ruled that union security clauses embodied in the CBA may be validly enforced and that dismissals pursuant thereto may likewise be valid, this does not erode the fundamental requirement of due process. The reason behind the enforcement of union security clauses which is the sanctity and inviolability of contracts, cannot override ones right to due process. (f) Totality of infractions doctrine179 It is the totality, not the compartmentalization of company infractions employee has committed, which justifies the penalty of dismissal.180 that the

Dismissal due to repetition of related offenses, even if already punished with less punitive sanctions.

177 178

This is the more determinative factor being manifested by some overt acts. In the case of Alabang Country Club, Inc. vs. NLRC, [G.R. No. 170287, Feb. 14, 2008], the Supreme Court declared that in terminating the employment of an employee by enforcing the union security clause, the employer needs only to determine and prove that: (1) the union security clause is applicable; (2) the union is requesting for the enforcement of the union security provision in the CBA; and (3) there is sufficient evidence to support the unions decision to expel the employee from the union. The foregoing requisites constitute just cause for terminating an employee based on the CBAs union security provision. 179 Cognate offenses rule 180 MERALCO v. NLRC, G.R. No. 114129, Oct. 24, 1996

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(2) Authorized Causes (a) Redundancy,181Retrenchment and Closure Redundancy Exists where the services of an employee are in excess of what would reasonably be demanded by the actual requirements of the enterprise. A position is redundant when it is superfluous. An employer has no legal obligation to keep on the payroll employees more than the number needed for the operation of the business. Retrenchment Cutting of expenses and includes the reduction of personnel. It is a management prerogative, a means to protect and preserve the employers viability and ensure his survival. To be an authorized cause it must be affected in good faith and for the retrenchment, which is after all a drastic recourse with serious consequences for the livelihood of the employees or otherwise laidoff. Closure The reversal of fortune of the employer whereby there is a complete cessation of business operations to prevent further financial drain upon an employer who cannot pay anymore his employees since business has already stopped.

i. Procedural steps required 1. Written notice to DOLE 30 days prior to the intended day of termination.182 2. Written notice to employee concerned 30 days prior the intended date of termination. 3. Payment of separation pay Serious business losses do not excuse the employer from complying with the clearance or report183 before terminating the employment of its workers. In the absence of justifying circumstances, the failure of the employer to observe the procedural requirements184 taints their actuations with bad faith if the lay off was temporary but then serious business losses prevented the reinstatement of respondents, the employers should have complied with the requirements of written notice.

181

A position is redundant when it is superfluous. An employer has no legal obligation to keep on the payroll employees more than the number needed for the operation of the business. 182 Purpose: To enable it to ascertain the veracity of the cause of termination. 183 required in Art. 283 of the LC and its IRR 184 under Art. 284

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ii. Requirements for valid retrenchment/redundancy Retrenchment Redundancy

1.Written notice served on both the 1. Written notice served on both the employee and the DOLE at least 1 month employees and the DOLE at least 1 prior to the intended date of retrenchment month prior to separation from work 2.Payment of separation pay equivalent to at least one month pay or at least 1/2 month pay for every year of service, whichever is higher 3. Good faith 4. Proof of expected or actual losses 5. The employer used fair and reasonable criteria in ascertaining who would be retained among the employees.185 2.Payment of separation pay equivalent to at least 1 month pay or at least 1 month pay for every year of service, whichever is higher 3. Good faith in abolishing redundant position 4. Fair and reasonable criteria in ascertaining what positions are to be declared redundant: a. Less preferred status186 b. Efficiency and c. Seniority187 iii. Criteria in selecting employees for dismissal 188 iv. Standards to be followed Firstly, the losses expected should be substantial and not merely de minimis in extent. If the loss purportedly sought to be forestalled by retrenchment is clearly shown to be insubstantial and inconsequential in character, the bona-fide nature of the retrenchment would appear to be seriously in question. Secondly, the substantial loss apprehended must be reasonably imminent, as such imminence can be perceived objectively and in good faith by the employer. There should, in other words, be a certain degree of urgency for the retrenchment which is, after all, a drastic recourse with serious consequences for the livelihood of the employees retrenched or otherwise laid off.

185

such as status, efficiency, seniority, physical fitness, age, and financial hardship of certain workers (Asian Alcohol Corp. v. NLRC, G.R. No. 131108, Mar. 25, 1999). 186 e.g. temporary employee 187 Phil. Tuberculosis Society, Inc. v. National Labor Union, G.R. No. 115414, Aug. 25, 1998 188 See table under Retrenchment (no. 5)

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Thirdly, retrenchment, because of its consequential nature, must be reasonably necessary and likely to effectively prevent the expected losses. The employer should have taken other measures prior or parallel to retrenchment to forestall losses, i.e., cut other costs than labor costs. Lastly, the alleged losses, if already realized, and the expected imminent losses sought to be forestalled, must be proved by sufficient and convincing evidence. The reason for requiring this quantum of proof is apparent; any less exacting standard of proof would render too easy the abuse of this ground for termination of services of employees. 189 (b) Disease or illness190 i. Requisites 1. The employee suffers from a disease; 2. His continued employment is prohibited by law or prejudicial to his health or to the health of his coemployees.191 3. With a certification by competent public health authority that the disease is incurable within 6 months despite due medication and treatment.192 b. Procedural Due Process (1) Procedure to be observed in termination cases 1.A written notice should be served to the employee specifying the ground/s for termination and giving the said employee reasonable opportunity to explain.193 2. A hearing or conference should be held during which the employee concerned, with the assistance of counsel, if the employee so desires, is given the opportunity to respond to the charge, present his evidence and present the evidence presented against him. 3. A written notice of termination - If termination is the decision of the employer, it should be served on the employerindicating that upon due considerations of all the circumstance, grounds have been established to justify his termination, at least one month prior to his termination.194
189

F. F. Marine Corporation vs. The Honorable Second Division NLRC, G. R. No. 152039, April 8, 2005; See also Clarion Printing House, Inc. vs. NLRC, G. R. No. 148372, June 27, 2005 190 Burden of proof rests on the employer. Company physician is not a competent public health authority. Medical certificate issued by company doctor is not sufficient 191 Sec.8, Rule I, Book VI, IRR 192 Solis v. NLRC, G.R. No. 116175, Oct. 28,1996 193 This first written notice must apprise the employee that his termination is being considered due to the acts stated in the notice. (Phil. Pizza Inc. v. Bungabong, G.R. No. 154315, May 9, 2005)

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(2) Guiding Principles in connection with the hearing requirements in dismissal cases i. "Ample opportunity to be heard" means any meaningful opportunity 195 given to the employee to answer the charges against him and submit evidence in support of his defense, whether in a hearing, conference or some other fair, just and reasonable way. ii. A formal hearing or conference becomes mandatory only when requested by the employee in writing or substantial evidentiary disputes exist or a company rule or practice requires it, or when similar circumstances justify it. iii. The "ample opportunity to be heard" standard in the Labor Code prevails over the "hearing or conference" requirement in the implementing rules and regulations. (3) Agabon doctrine Enunciates the rule that if the dismissal was for just cause but procedural due process was not observed, the dismissal should be upheld. Where the dismissal is for just cause, the lack of statutory due process should not nullify the dismissal or render it illegal or ineffectual. However, the employer should indemnify the employee for the violation of his right to procedural due process. The indemnity to be imposed should be stiffer to discourage the abhorrent practice of "dismiss now, pay later," which we sought to deter in the Serrano ruling. In Agabon, the nominal damages awarded was P30,000.00. c. Reliefs for illegal dismissal (1) Reinstatement aspect196 (a) Immediately executory197 i. Actual reinstatement The employee is admitted back to work. (b) Payroll reinstatement The employee is merely reinstated in the payroll.

194

Single notice of termination does not comply with the requirements of the law. (Aldeguer & Co., Inc. vs. Honeyline Tomboc) G.R. No. 147633, July 28, 2008) 195 verbal or written 196 restoration to a state from which one has been removed 197 Under Art 223, the decision of the Labor Arbiter reinstating a dismissed employee is immediately executory even while the case is brought up on appeal.

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(2) Separation pay198 in lieu of Reinstatement (a) Strained Relation rule When the employer can no longer trust the employee and vice versa, or there were imputations of bad faith to each other, reinstatement could not effectively serve as a remedy. This doctrine applies only to positions which require trust and confidence.199 Under the circumstances where the employment relationship has become so strained to preclude a harmonious working relationship and that all hopes at reconciliation are naught after reinstatement, it would be more beneficial to accord the employe backwages and separation pay. (3) Backwages200 (a) Components of the amount of backwages Following several decisions of the Supreme Court, the following benefits, in addition to the basic salary, should be taken into account in the computation of backwages, if applicable: 1. Fringe benefits or their monetary equivalent.201 2. Increases in compensation and other benefits, including 13th month pay202

198

Reinstatement can no longer be effected in view of the long passage of time or because of the realities of the situation. It is the amount that an employee receives at the time of his severance from the service and is designed to provide the employee with the wherewithal during the period that he is looking for another employment. Separation pay is payable to an employee whose services are validly terminated for authorized causes (Article 283 and 284). An employee dismissed for a just cause is not entitled to separation pay (Article 282). Exception: Where the employee is dismissed for causes other than serious misconduct or those reflecting on his moral character, separation pay may be allowed as a measure of social justice 199 Globe Mackay v. NLRC, G.R. No. 82511, March 3, 1992 There is a resultant strained relations or irretrievable estrangements between the employer and the employee where the employee concerned occupies a position of trust and confidence and it is likely that if reinstated an atmosphere of antipathy and antagonism may be generated as to adversely affect the efficiency and productivity of the employee. 200 A form of relief that restores the income of the employee that was lost by reason of the unlawful dismissal. Full Backwages have to be paid by an employer as part of the price or penalty he has to pay for illegally dismissing his employee. Other benefits must be paid in addition to backwages. The computation should be based on the wage rate level at the time of the illegal dismissal and not in accordance with the latest, current wage level of the employees position. 201 Acesite Corporation vs. NLRC, G. R. No. 152308, Jan. 26, 200 202 Traders House, Inc. vs. NLRC, G. R. No. 120677, Dec. 21, 1998, 300 SCRA 360

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3. Transportation and emergency allowances203 4. Holiday pay, vacation and sick leaves and service incentive leaves204 5. Just share in the service charges205 6. Gasoline, car and representation allowances206 7. Any other allowances and benefits or their monetary equivalent.207 The computation of said benefits should be up to the date of reinstatement as provided under Article 279208 of the Labor Code.209 (4) Constructive dismissal An involuntary resignation resorted to when continued employment becomes impossible, unreasonable, or unlikely; when there is a demotion in rank or a diminution in pay; or when a clear discrimination, insensibility or disclaim by an employer becomes unbearable to an employee.210 (5) Preventive Suspension211 During pendency of the investigation, if the workers continued employment poses a serious and imminent threat to life and property of employer, or of his co-employees.212 Can be extended provided the employer pays the suspended employee his wages and other benefits.

203 204

Santos vs. NLRC, G. R. No. 76721, Sept. 21, 1987; Soriano vs. NLRC, G. R. No. L-75510, Oct. 27, 1987.. St. Louise College of Tuguegarao vs. NLRC, G. R. No. 74214, Aug. 31, 1989; On service incentive leave, see Fernandez vs. NLRC, G. R. No. 105892, Jan. 28, 1998, 285 SCRA 149.. 205 Maranaw Hotels & Resort Corporation vs. NLRC, G. R. No. 123880, Feb. 23, 1999). 206 Consolidated Rural Bank [Cagayan Valley], Inc. vs. NLRC, G. R. No. 123810, Jan. 20, 1999, 301 SCRA 223. 207 Blue DairyCorporation vs. NLRC, G. R. No. 129843, Sept. 14, 1999. 208 See Reference 209 Fernandez vs. NLRC, supra. 210 Leonardo v. NLRC, G.R. No.125303, June 16, 2000 An employee is deemed constructively dismissed where his status is changed from regular to casual. 211 Rule pending appeal: Preventive suspension is punitive already; hence, if exonerated, the employee must be reinstated and compensated for the period of his suspension Suspension beyond 30 days ripens to dismissal 212 Max period: 30 days

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(6) Quitclaims213 A quitclaim is a document executed by an employee in favor of the employer preventing the former from filing any further money claim against the latter arising from employment. Once an employee resigns and executes a quitclaim in favor of the employer, he is thereby estopped from filing any further money claim. It should be voluntarily signed. But even if voluntary, if it is contrary to public policy, it is deemed invalid. (7) Termination of employment by employee Without just cause With just causes

By serving written notice on the employer An employee may put an end to at least one (1) month in advance. employment without serving any notice on the employer for any of the following The employer upon whom no such just causes: notice was served may hold the employee liable for damages. a. Serious insult by the employer or his representative on the hour and person of the employee214 b. Inhuman and unbearable treatment accorded the employee by the employer or his representative215 c. Commission of a crime or offense by the employer or his representative against the person of the employee or any of the immediate members of his family216

213

Not all waivers and quitclaims are invalid as against public policy. If the agreement was voluntarily entered into and represents a reasonable settlement, it is binding on the parties. It is only when there is clear proof that the waiver was wangled from an unsuspecting or gullible person, or the terms are unconscionable that the law will step in to annul it. Dire necessity is not an acceptable ground for annulling the releases. 214 Implies malice or denotes ill-will or an intent to injure or to offend, or to wound the feelings of another. 215 Any conduct which will affect the mind and body or where continuance of it involves the life or health of the employee No comfort room provided by the employer compelling the employees to go outside employers business premises to heed the call of nature constitutes unbearable treatment. No gas masks provided by employer although employees work deals with smoke-producing chemicals amounts to inhuman treatment

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d. Other causes analogous to any of the foregoing217 3. Retirement Pay Law a. Coverage Applies to all employees in the private sector, regardless of their position, designation or status and irrespective of the method by which their wages are paid, except those specifically exempted. It also includes and covers part-time employees, employees of service and other job contractors and domestic helpers or persons in the personal service of another. b. Exclusions from coverage 1. Employees of the National Government and its political subdivisions, including government-owned and/or controlled corporations, if they are covered by the Civil Service Law and its regulations. 2. Domestic helpers and persons in the personal service of another 3. Employees of retail218, service219 and agricultural220 establishments or operations regularly employing not more than ten (10) employees. 221

216

The act of slapping the employee plus the threat of scratching her face with a pair of scissors constitute an offense which would justify employees severing employer-employee relationship. 217 1. Undue delay in the payment of employees salaries or wages 2. Violation of employment term and condition 3. Unsanitary or unhygienic working conditions 218 one principally engaged in the sale of goods to end-users for personal or household use. It shall lose its retail character qualified for exemption if it is engaged in both retail and wholesale of goods. 219 one principally engaged in the sale of service to individuals for their own or household use and is generally recognized as such.. 220 refers to an employer which is engaged in agriculture. This term refers to all farming activities in all branches and includes, among others, the cultivation and tillage of soil, production, cultivation, growing and harvesting of any agricultural or horticultural commodities, dairying, raising of livestock or poultry, the culture of fish and other aquatic products in farms or ponds, and any activities performed by a farmer or on a farm as an incident to, or in conjunction with, such farming operations, but does not include the manufacture and/or processing of sugar, coconut, abaca, tobacco, pineapple, aquatic or other farm products 221 Sec.2, Rule II, Book VI, IRR

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c. Components of retirement pay In the absence of an applicable employment contract, an employee who retires shall be entitled to retirement pay equivalent to at least one-half (1/2) month salary for every year of service, a fraction of at least six (6) months being considered as one (1) whole year. 222 d. Retirement pay under R.A. 7641 vis--vis retirement benefits under SSS and GSIS laws Social Security Law Revised Government Service Insurance Act Employees Compensation Act Compulsory upon all employers and their employees not over 60years of age; Provided, that an employee who is over 60 years of age and paying contributions to qualify for the retirement or life insurance benefit administered by the System shall be subject to compulsory coverage.

Compulsory upon all Compulsory for all employees not over 60 years permanent employees below of age and their employers. 60 years of age upon appointment to permanent 1.Filipinos recruited in the status, and for all elective officials for the duration Phils. by foreign based of their tenure. employers for employment abroad may be covered by 1. Any person, whether the SSS on a voluntary elected or appointed, in basis. the service of an 2. Compulsory upon all self employer is a covered employee if he receives employed persons earning P1,800 or more per annum. compensation for such service.

222

Art. 287, as amended Components. - For the purpose of determining the minimum retirement pay due an employee, the term one-half month salary shall include all the following: (a) fifteen (15) days salary of the employee based on his latest salary rate. (b) the cash equivalent of five (5) days of service incentive leave; (c) one-twelfth (1/12) of the 13th month pay due the employee; and (d) all other benefits that the employer and employee may agree upon that should be included in the computation of the employees retirement pay

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E. MANAGEMENT PREROGATIVE 1. Discipline223 The employers right to conduct the affairs of his business, according to its own discretion and judgment, includes the prerogative to instill discipline in its employees and to impose penalties, including dismissal, upon erring employees. This is a management prerogative where the free will of management to conduct its own affairs to achieve its purpose takes form. The only criterion to guide the exercise of its management prerogative is that the policies, rules and regulations on work-related activities of the employees must always be fair and reasonable and the corresponding penalties, when prescribed, commensurate to the offense involved and to the degree of the infraction.224 Instilling discipline among its employees is a basic management right and prerogative. Management may lawfully impose reasonable penalties such as dismissal upon an employee who transgresses the company rules and regulations. 225 2. Transfer of employees226 The Supreme Court has recognized and upheld the prerogative of management to transfer an employee from one office to another within the business establishment, provided there is no demotion in rank or diminution of salary, benefits, and other privileges; and the action is not motivated by discrimination, made in bad faith, or effected as a form of punishment or demotion without sufficient cause. This is a privilege inherent in the employers right to control and manage its enterprise effectively.227 3. Productivity standard The practice of a company in laying off workers because they failed to make the work quota has been recognized in this jurisdiction. 228

223

subject to reasonable regulation by the State in the exercise of its police power. (Associated Labor Unions-TUCP vs. NLRC, G. R. No. 120450, Feb. 10, 1999; PLDT vs. NLRC, 276 SCRA 1 [1997]). 224 St. Michaels Institute vs. Santos, G. R. No. 145280, Dec. 4, 2001; Consolidated Food Corporation vs. NRLC, 315 SCRA 129, 139 [1999] 225 Deles, Jr. vs. NLRC, G. R. No. 121348, March 9, 2000. 226 Jurisprudential guidelines: (a) a transfer is a movement from one position to another of equivalent rank, level or salary without break 226 in the service or a lateral movement from one position to another of equivalent rank or salary; (b) the employer has the inherent right to transfer or reassign an employee for legitimate business purposes; (c) a transfer becomes unlawful where it is motivated by discrimination or bad faith or is effected as a 226 form of punishment or is a demotion without sufficient cause; (d) the employer must be able to show that the transfer is not unreasonable, inconvenient, or prejudicial to the employee 227 Mendoza vs. Rural Bank of Lucban, G. R. No. 155421, July 7, 2004; Benguet Electric Cooperative vs. Fianza, G. R. No. 158606, March 9, 2004. 228 Philippine American Embroideries vs. Embroidery and Garment Workers, 26 SCRA 634, 639.

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Failure to observe prescribed standards of work, or to fulfill reasonable work assignments due to inefficiency may constitute just cause for dismissal. Such inefficiency is understood to mean failure to attain work goals or work quotas, either by failing to complete the same within the allotted reasonable period, or by producing unsatisfactory results. This management prerogative of requiring standards may be availed of so long as they are exercised in good faith for the advancement of the employer's interest. 229 4. Grant of Bonus By definition, a "bonus" is a gratuity or act of liberality of the giver which the recipient has no right to demand as a matter of right230. It is something given in addition to what is ordinarily received by or strictly due the recipient. The granting of a bonus is basically a management prerogative which cannot be forced upon the employer who may not be obliged to assume the onerous burden of granting bonuses or other benefits aside from the employee's basic salaries or wages,231 especially so if it is incapable of doing so. 5. Change of working hours Well-settled is the rule that management retains the prerogative, whenever exigencies of the service so require, to change the working hours of its employees. 232 The employer has the prerogative to control all aspects of employment in his business organization such as hiring, work assignments, working methods, time, place and manner of work, tools to be used, processes to be followed, supervision of workers, working regulations, transfer of employees, work supervision, lay-off of workers and the discipline, dismissal and recall of workers. 233 6. Marital discrimination234 It shall be unlawful for an employer to require as a condition of employment or continuation of employment that a woman employee shall not get married, or to stipulate
229 230

Buiser v. Leogardo, Jr., 131 SCRA 151, 158 (1984). Traders Royal Bank v. NLRC, 189 SCRA 274 [1990] citing Aragon v. Cebu Portland Cement Co., 61 O.G. 4567. 231 Kamaya Point Hotel v. NLRC, 177 SCRA 160 (1989). 232 Sime Darby Pilipinas, Inc. vs. NLRC, G.R. No. 119205, 15 April 1998, 289 SCRA 86 233 Consolidated Food Corporation, et al. vs. NLRC, et al., G. R. No. 118647, Sept. 23, 1999. 234 Unless the employer can prove that the reasonable demands of the business require a distinction based on marital status and there is no better available or acceptable policy which would better accomplish the business purpose, an employer may not discriminate against an employee based on the 234 identity of the employees spouse. This is known as the bona fide occupational qualification exception. Since the finding of a bona fide occupational qualification justifies an employers no-spouse rule, the exception is interpreted strictly and narrowly by these state courts. There must be a compelling business necessity for which no alternative exists other than the discriminatory practice. To justify a bona fide occupational qualification, the employer must prove two factors: (1) that the employment qualification is reasonably related to the essential operation of the job involved; and, (2) that there is a factual basis for believing that all or substantially all persons meeting the qualification would be unable to properly perform the duties of the job.

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expressly or tacitly that upon getting married, a woman employee shall be deemed resigned or separated, or to actually dismiss, discharge, discriminate or otherwise prejudice a woman employee merely by reason of her marriage.235 7. Post-employment ban Whether such an agreement would be held valid and binding will depend on its reasonableness in relation to the parties concerned, as well as to its public policy. 8. Limitations in its exercise i. Management's prerogatives must be without abuse of discretion 236. ii. It must be duly established that the prerogative being invoked is clearly a managerial one. iii. It is circumscribed by limitations found in law, a collective bargaining agreement, or the general principles of fair play and justice237 So long as a company's management prerogatives are exercised in good faith for the advancement of the employer's interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements, this Court will uphold them238.

235 236

Sec. 136. Cruz vs. Medina (177 SCRA 565 [1989]) 237 University of Sto. Tomas vs. NLRC, 190 SCRA 758 [1990]). 238 San Miguel Brewery Sales Force Union (PTGWO) vs. Ople (170 SCRA 25 [1989])

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F. SOCIAL LEGISLATION 1. SSS Law239 a. Coverage i. Compulsory upon all employees not over sixty (60) years of age and their employers. In the case of domestic helpers, their monthly income shall not be less than One thousand pesos (P1,000.00) a month.240 ii. Spouses who devote full time to managing the household and family affairs, unless they are also engaged in other vocation or employment which is subject to mandatory coverage, may be covered by the SSS on a voluntary basis. iii. Filipinos recruited by foreign-based employers for employment abroad may be covered by the SSS on voluntary basis. b. Exclusions from coverage241 i. Agricultural labor when performed by a share or leasehold tenant or worker who is not paid any regular daily wage or base pay and who does not work for an uninterrupted period of at least six months in a year;242 ii. Domestic service in a private home; iii. Employment purely casual and not for the purposes of occupation or business of the employer; iv. Service performed by an individual in the employ of his son, daughter, or spouse, and service performed by a child under the age of twenty-one years in the employ of his parents; v. Service performed on or in connection with an alien vessel by an employee if he is employed when such vessel is outside the Philippines;
239 240

R.A. 8282 Also compulsory upon such self-employed persons as may be determined by the Commission under such rules and regulations as it may prescribe, including but not limited to the following: 1.All/self-employed/professionals; 2. Partners and single proprietors of businesses; 3.Actors and actresses, directors, scriptwriters and news correspondents who do not fall within the definition of the term "employee" 4.Professional/athletes,/coaches,/trainers/and/jockeys;/and 5.Individual farmers and fishermen. Unless otherwise specified in the law, all provisions of the SSS LAW applicable to covered employees shall also be 241 Sec. 8(j) of Social Security Act (As amended by Sec. 5, P.D. No. 735, S-1975). 242 As amended by Sec. 4, R.A. 2658

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vi. Service performed in the employ of the Philippine Government or an instrumentality or agency thereof; vii. Service performed in the employ of a foreign government or international organization, or their wholly-owned instrumentality: Provided, however, That his exemption notwithstanding, any foreign government, international organization, or their wholly-owned instrumentality employing workers in the Philippines or employing Filipinos outside of the Philippines may enter into an agreement with the Philippine Government for the inclusion of such employees in the SSS except those already covered by their respective civil service retirement systems: Provided, further, That the terms of such agreement shall conform with the provisions of this Act on coverage and amount of payment of contributions and benefits: Provided, finally, That the provisions of this Act shall be supplementary to any such agreement243. viii. Such other services performed by temporary employees who may be excluded by regulation of the Commission. Employees of bona fide independent contractors shall not be deemed employees of the employer engaging the services of said contractors 244. c. Benefits i. Monthly pension; ii. Dependentspension ; iii. Retirement benefits; iv. Death benefits; v. Permanent disability benefits; vi. Funeral benefit; vii. Sickness benefit; viii. Maternity leave benefit. d. Beneficiaries i. The dependent spouse until he or she remarries ii. The dependent legitimate, legitimated or legallyadopted, and illegitimate children, who shall be the primary beneficiaries of the member. iii. In their absence, the dependent parents who shall be the secondary beneficiaries of the member.

243 244

As amended by Sec. 1, R.A. 3839; Sec. 3, R.A. 4857; and Sec. 5, P.D. No. 735, S-1975 As amended by Sec. 5, P.D. No. 735, S-1975

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iv. In the absence of all the foregoing, any other person designated by the member as his/her secondary beneficiary. 2. GSIS Law245 a. Coverage Compulsory for all employees receiving compensation who have not reached the compulsory retirement age, irrespective of employment status. b. Exclusions from coverage i. Members of the Armed Forces of the Philippines and the Philippine National Police, subject to the condition that they must settle first their financial obligation with the GSIS, and ii. Contractuals who have no employer and employee relationship with the agencies they serve. c. Benefits i. Monthly Pension; ii. Separation Benefits; iii. Unemployment or Involuntary Separation Benefits; iv.RetirementBenefits; v. Permanent Disability Benefits; vi.Temporary Total Disability Benefits; vii. Survivorship Benefits; viii.Funeral/Benefits; ix. Compulsory Life Insurance Benefit; x. Optional Insurance and/or pre-need coverage embracing life, health, hospitalization, education, memorial plans, and such other plans as may be designed by the GSIS, for the member and/or his dependents.

245

R.A. 8291

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d. Beneficiaries i. Primary beneficiaries- The legal dependent spouse until he/she remarries and the dependent children; ii. Secondary beneficiaries- The dependent parents and, subject to the restrictions on dependent children, the legitimate descendants 3. Limited Portability Law246 Under this law, an employee who has worked in both the private and public sectors and has been covered by both the Government Service Insurance System (GSIS) and the Social Security System (SSS) shall have his creditable services or contributions in both Systems credited to his service or contribution record in each of the Systems, which shall be summed up for purposes of old age, disability, survivorship and other benefits in case the covered member does not qualify for such benefits in either or both Systems without the totalization. 4. Employees Compensation247 Coverage and when compensable Coverage in the State Insurance Fund shall be compulsory upon all employers and their employees not over sixty years of age: Provided, That an employee who is over sixty years of age and paying contributions to qualify for the retirement or life insurance benefit administered by the System shall be subject to compulsory coverage: Provided, further, That in case of an employee who is both covered by the SSS and GSIS, only his employment under the GSIS shall be considered for purposes of his coverage. The State Insurance Fund shall be liable for compensation to the employee or his dependents, except when the disability or death was occasioned by the employee's intoxication, willful intention to injure or kill himself or another, notorious negligence, or otherwise provided under this Title.

246 247

R.A. 7699 P.D. No. 626

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G. LABOR RELATIONS LAW 1. Right to Self-organization248 The right to join, assist or form labor organizations for collective bargaining and to engage in lawful concerted activities for the same purpose or for their mutual aid and protection. Any employee249, whether employed for a definite period or not, shall beginning on the first day of his/her service, be eligible for membership in any labor organization. 250 a. Who may unionize for purposes of collective bargaining All persons employed in: Commercial Industrial Agricultural Charitable Religious Educational Likewise: Ambulant workers Intermittent workers Rural workers
248

) enterprises ) whether operating for profit or not ) Institutions

Employees of government corporations established under the Corporation Code (without original charters) shall have the right to organize and to bargain collectively with their respective employers. All other employees in the civil service shall have the right to form associations for purposes not contrary to law. General rule: All aliens, natural or juridical, as well as foreign organizations are strictly prohibited from engaging directly or indirectly in all forms of trade union activities without prejudice to normal contacts between Philippine labor unions and recognized international labor centers. Exception: Alien employees with valid working permits issued by the DOLE may exercise the right to self-organization and join or assist labor organizations for purposes of collective bargaining, if they are nationals of a country which grants the same or similar rights to Filipino workers, as certified by the Department of Foreign Affairs. 249 Three categories of employees: a. Managerial; b. Supervisory; and c. Rank-and-file. 250 ibid.; See also Art. 277; No. 10, Basic Amendments under R. A. 6715, prepared by Members of the Senate-House Conference Committee of Congress.

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Workers with no definite employers Itinerant workers Self-employed Specific Coverage: Supervisory employees251 Terminated employees who are contesting their termination Aliens with valid work permit Government employees New employees Iglesia ni Kristo members Security guards (1) Who cannot form, join or assist labor organizations As a general rule, only top and middle managers are not allowed to join any labor organization. First-line managers252 are allowed to join a supervisory union but not the union of rank-and-file employees or vice-versa. In fact, the law does not allow mixed membership of both supervisory and rank-and-file employees in one union. A union with such mixed membership is no union at all. It cannot exercise the rights of a legitimate labor organization. (2) Executive Order No. 180 The right of government employees to form, join or assist employees organizations of their own choosing is not regarded as existing or available for purposes of collective bargaining but simply for the furtherance and protection of their interests 253.

251

Not eligible for membership in a labor union of the rank-and-file employees but may form, join or assist separate labor unions of their own. A union whose membership is a mixture of supervisors and rank-and-file is not and cannot become a legitimate labor organization A local supervisors union should not be allowed to affiliate with the national federation of union of rank-and-file employees where that federation actively participates in union activity in the company and the rank-and-file employees are directly under the authority of the supervisory employees 252 or supervisory employees 253 Arizala vs. CA, Sept. 14, 1990

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Excluded from negotiation by government employees are the terms and conditions of employment that are fixed by law, it being only those terms and conditions not otherwise fixed by law. Concedes to government employees the right to engage in concerted activities, including the right to strike provided such activities are exercised in accordance with law. b. Bargaining unit The group or cluster of jobs or positions that supports the labor organization which is applying for registration, within the employers establishment Refers to a group of employees sharing mutual interests within a given employer unit, comprised of all or less than all of the entire body of employees in the employer unit or any specific occupational or geographical grouping within such employer unit. (1) Test to determine the constituency of an appropriate bargaining unit Any of the following four (4) modes may be used: a. Substantial mutual interests principle or community or mutuality of interests rule. The employees sought to be represented by the collective bargaining agent must have substantial mutual interests in terms of employment and working conditions as evinced by the type of work they perform. It is characterized by similarity of employment status, same duties and responsibilities and substantially similar compensation and working conditions254. b. Globe doctrine255 The determining factor is the desire of the workers themselves. Consequently, a certification election should be held separately to choose which representative union will be chosen by the workers256. c. Collective bargaining history. Enunciates that the prior collective bargaining history and affinity of the employees should be considered in determining the appropriate bargaining unit. However, the Supreme Court has categorically ruled that the existence of a prior collective bargaining history is

254

San Miguel Corporation Employees Union-PTGWO vs. Confesor, G. R. No. 111262, Sept. 19, 1996, 262 SCRA 81, 98 255 will of the employees 256 See also Mechanical Department Labor Union sa Philippine National Railways vs. CIR, G. R. No. L28223, Aug. 30, 1968.

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neither decisive nor conclusive in the determination of what constitutes an appropriate bargaining unit.257 d. Employment status. The determination of appropriate bargaining unit based thereon is considered an acceptable mode.258 (2) Voluntary Recognition259 Voluntary recognition of bargaining agent is the free and voluntary act of the employer of extending and conferring full recognition to a union as the sole and exclusive bargaining representative of the employees in an appropriate bargaining unit, for purposes of collective bargaining. This is allowed when there is only one union operating in the bargaining unit. (a) Requirements 1. Submission to DOLE of a joint statement260 recognition. attesting to the voluntary

2. The joint- statement261 must be published for 15 consecutive days in 2 conspicuous places in the establishment or CBU where the union seeks to operate

257

San Miguel Corporation vs. Laguesma, G. R. No. 100485, Sept. 21, 1994; National Association of Free Trade Unions vs. Mainit Lumber Development Company Workers Union, G. R. No. 79526, Dec. 21, 1990) 258 Rothenberg on Labor Relations, pp. 482-510. 259 Effect of voluntary recognition: From the time of recording, the union shall enjoy the rights, privileges and obligations of an exclusive bargaining representative Voluntary acknowledgement can ONLY take place when there is no dispute as to what union counts in its members a majority of the employees. Voluntary recognition is possible only in an unorganized establishment. In an organized setting, the employer cannot voluntarily recognize any new union because Art. 256, LCP requires the employer to continue recognizing and dealing with the incumbent union if it has not been properly replaced by another union. 260 by the employer and union president 261 The joint-statement should state the approximate number of employees in the CBU, accompanied by the names and signatures of at least a majority of the members of the CBU supporting the voluntary recognition; The joint-statement should state that there are no other LLOs operating within the CBU The joint-statement must be submitted to the Regional Office within 30 days from date of recognition

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(3) Certification election It refers to the process of determining through secret ballot the sole and exclusive bargaining representative of the employees in an appropriate bargaining unit, for purposes of collective bargaining. (a) In an unorganized establishment Certification election shall be "automatically" conducted upon the filing of a petition for certification election by a legitimate labor organization. However, it must be emphasized that the petitioner-union should have a valid certificate of registration; otherwise, it has no legal personality to file the petition for certification election. (b) In an organized establishment The following are the requisites for certification election in organized establishments. 1. A petition questioning the majority status of the incumbent bargaining agent is filed before the DOLE within the 60-day freedom period; 2. Such petition is verified; and 3. The petition is supported by the written consent of at least twenty-five percent (25%) of all employees in the bargaining unit (c) Rules prohibiting the filing of petition for certification election 1. Certification year-bar rule; A certification election petition may not be filed within one (1) year: or i. from the date of a valid certification, consent or run-off election; ii. from the date of voluntary recognition.

2. Bargaining deadlock-bar rule; Neither may a representation question be entertained if: i. before the filing of a petition for certification election, the duly recognized or certified union has commenced negotiations with the employer within the one-year period from the date of a valid certification, consent or run-off election or from the date of voluntary recognition; or ii. a bargaining deadlock to which an incumbent or certified bargaining agent is a party had been submitted to conciliation or arbitration or had become the subject of valid notice of strike or lockout.
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3. Contract-bar rule262 The Bureau of Labor Relations shall not entertain any petition for certification election or any other action which may disturb the administration of duly registered existing collective bargaining agreements affecting the parties. (d) Requirements for validity of certification election For a valid election, at least a majority of all eligible voters in the unit must have cast their votes. The labor union receiving the majority of the valid votes cast shall be certified as the exclusive bargaining agent of all the workers in the unit. 263 (e) Protests and other questions arising from conduct of certification election Certification proceedings directly involve two (2) issues: 1. Proper composition and constituency of the bargaining unit; and 2. The veracity of majority membership claims of the competing unions so as to identity the one union that will serve as the bargaining representative of the entire bargaining unit.264 (4) Run-off election It refers to an election between the labor unions receiving the two (2) highest number of votes when a certification election which provides for three (3) or more choices results in no choice receiving a majority of the valid votes cast; provided, that the total number of votes for all contending unions is at least fifty percent (50%) of the number of votes cast.

262

The exceptions to the contract-bar rule are as follows: 1. during the 60-day freedom period; 2. when the CBA is not registered with the BLR or DOLE Regional Offices; 3. when the CBA, although registered, contains provisions lower than the standards fixed by law; 4. when the documents supporting its registration are falsified, fraudulent or tainted with misrepresentation; 5.when the collective bargaining agreement is not complete as it does not contain any of the requisite provisions which the law requires; 6. when the collective bargaining agreement was entered into prior to the 60-day freedom period; 7. when there is a schism in the union resulting in an industrial dispute wherein the collective bargaining agreement can no longer foster industrial peace. 263 R. Manalac, Phil. Labor Laws and Jurisprudence, 2007 Ed., p. 248 264 Some of the employees may not want to have a union; hence, no union is one of the choices named in the ballot. If no union wins, the company or the bargaining unit remains ununionized for at least 12 months, the period is known as 12month bar. After that period, a petition for a CE may be filed again.

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(a) Requirements 1. A valid election took place because majority of the CBU members voted 2. The election presented at least three choices 3. Not one of the choices obtained the majority of the valid votes 4. The total votes of the unions is at least 50% of the votes cast 5. There is no unresolved challenge of voter or election protest (5) Re-run election tie; or 1. If one choice receives a plurality of the vote and the remaining choices results in a 2. If all choices received the same number of votes. In both instances, the no union is also a choice. (6) Consent election265 It refers to the election voluntarily agreed upon by the parties, with or without the intervention of the Department of Labor and Employment, to determine the issue of majority representation of all the workers in the appropriate collective bargaining unit. In hearing a petition for a CE, the Med-Arbiter may persuade the contending unions to agree to a consent election. If the unions do agree, the Med-Arbiter shall enter in the minutes of the hearing the fact of the agreement and then cause the immediate scheduling of the pre-election conference.

265

The holding of a valid consent election, upon the intercession of the med-arbiter, bars the holding of a CE for one year. Where no petition for a CE had been filed but the parties themselves have agreed to hold consent election, the results of the election will NOT bar another CE, UNLESS the winning union had been extended voluntary recognition by the employer Consent election is a separate and distinct process and has nothing to do with the import and effect of a certification election. Neither does it shorten the terms of an existing CBA nor entitle the participants thereof to immediately renegotiate an existing CBA although it does not preclude the workers from exercising their right to choose their sole and exclusive bargaining representative after the expiration of the 60-day freedom period.

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(7) Affiliation and disaffiliation of the local union from the mother union (a) Substitutionary doctrine266 This principle states that even during the effectivity of a collective bargaining agreement executed between employer and employees thru their agent, the employees can change said agent but the contract continues to bind then up to its expiration date. They may bargain however for the shortening of said expiration date. In formulating the "substitutionary" doctrine, the only consideration involved is the employees' interest in the existing bargaining agreement. The agent's interest never entered the picture. In fact, the justification for said doctrine was: ... That the majority of the employees, as an entity under the statute, is the true party in interest to the contract, holding rights through the agency of the union representative. Thus, any exclusive interest claimed by the agent is defeasible at the will of the principal.267 (8) Union dues and special assessments Union dues Regular monthly contributions paid by the members to the union in exchange for the benefits given to them by the CBA and to finance the activities of the union in representing the union. Special assessments These are assessments for any purpose or object other than those expressly provided by the labor organizations constitution and bylaws.

Requirements for validity By obtaining the individual written authorization duly signed by the employee which must specify: 1. Amount By written resolution approved by majority of all the members at the meeting called for that purpose.269

266

Employees cannot revoke the validity of a validly executed CBA with their employer by the simple expedient of changing their collective bargaining agent The new agent must respect the subsisting CBA Employer cannot renege on the CBA, except to negotiate with the management for the shortening thereof Inapplicable to personal undertaking of deposed union; e.g. : no strike stipulation 267 Benguet Consolidated Inc. vs. BCI Employees & W Union-PAFLU, 23 SCRA, 465, 471

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2. Purpose 3. Beneficiary268 (9) Agency fees270 (a) Requisites for assessment i. The employee is part of the bargaining unit ii. He is not a member of the union iii. He partook of the benefits of the CBA 2. Right to Collective Bargaining 271 a. Duty to bargain collectively The performance of the mutual obligation of the employer and the sole bargaining representative to meet promptly, expeditiously, & in good faith & agree on Wages, Hours of Work & Other terms & conditions of employment (WHO).

269 268

Art.241 Ibid.,(o) 270 It is an amount equivalent to union dues, which a non-union member pays to the union because he benefits from the CBA negotiated by the union. 271 Collective Bargaining Agreement (CBA) refers to the negotiated contract between a legitimate labor organization and the employer concerning wages, hours of work and all other terms and conditions of employment in a bargaining unit. The CBA is deemed the law between the parties during its lifetime. Its provisions are construed liberally. Legal principles applicable to Collective Bargaining Agreement: A proposal not embodied in CBA is not part thereof. Minutes of CBA negotiation - no effect if its contents are not incorporated in the CBA. Making a promise during the CBA negotiation is not considered bad faith. Adamant stance resulting in impasse, not bad faith. The DOLE Secretary cannot order inclusion of terms and conditions in CBA which the law and the parties did not intend to reflect therein. Signing bonus, not demandable under the law. Allegations of bad faith, wiped out with signing of CBA. Term (lifetime) of a CBA Representation aspect (sole and exclusive status of certified union): - The term is 5 years which means that no petition questioning the majority status of the incumbent bargaining agent shall be entertained by DOLE and no certification election shall be conducted outside of the 60-day freedom period. All other provisions (which refer to both economic and non-economic provisions except representation): Shall be renegotiated not later than three (3) years after its execution.

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(1) Kiok Loy ruling In the case of Kiok Loy vs. NLRC,272 the Supreme Court found that petitioner therein, Sweden Ice Cream Plant, refused to submit any counter proposal to the CBA proposed by its employees certified bargaining agent. It ruled that the former had thereby lost its right to bargain the terms and conditions of the CBA. Thus, the High Court did not hesitate to impose on the erring company the CBA proposed by its employees union - lock, stock and barrel. b. Mandatory provisions of CBA 1. Wages & Hours of Work 2. Other terms & conditions 3. Other modes of compensation 4. Work shifts 5. Vacation & holidays 6. Bonuses 7. Pensions & retirement plans 8. Seniority 9. Transfers 10. Lay-offs 11. Workload 12. Work rules & regulations 13. Rent of company houses 14. Union security agreements An employer does not commit ULP by insisting to the point of a bargaining impasse, on the inclusion in a contract of a management prerogative clause, or a union discipline clause, or a no strike clause. (1) Grievance Procedure The internal rules of procedure established by the parties in their CBA with voluntary arbitration as the terminal step, which are intended to resolve all issues arising from the implementation and interpretation of their CBA. It refers to the system of grievance settlement at the plant level as provided in the collective bargaining agreement. It usually consists of successive steps starting at the level of the complainant and his immediate supervisor and ending, when necessary, at the level of the top union and company officials
272

No. L-54334, January 22, 1986, 141 SCRA 179, 188

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All grievances submitted to the grievance machinery 273 which are not settled within seven (7) calendar days from the date of their submission shall automatically be referred to voluntary arbitration prescribed in the CBA. For this purpose, parties to a CBA shall name and designate in advance a Voluntary Arbitrator or panel of Voluntary Arbitrators, or include in the agreement a procedure for the selection of such Voluntary Arbitrator or panel of Voluntary Arbitrators, preferably from the listing of qualified Voluntary Arbitrators duly accredited by the NCMB. In case the parties fail to select a Voluntary Arbitrator or panel of Voluntary Arbitrators, the NCMB shall designate the Voluntary Arbitrator or panel of Voluntary Arbitrators, as may be necessary, pursuant to the selection procedure agreed upon in the CBA, which shall act with the same force and effect as if the Arbitrator or panel of Arbitrators has been selected by the parties as described above. (2) Voluntary Arbitration Refers to the mode of settling labor-management disputes by which the parties select a competent, trained and impartial third person who shall decide on the merits of the case and whose decision is final and executor.274 (3) No Strike-No Lockout Clause The no strike no lockout clause strikes. It does not apply to ULP strikes.275 in the CBA applies only to economic

Such no-strike provision in the CBA only bars strikes which are economic in nature, but not strikes grounded on unfair labor practices.276 The Supreme Court consistently ruled in a long line of cases that a strike is illegal if staged in violation of the No Strike/No Lockout Clause in the CBA stating that a strike, which is in violation of the terms of the CBA, is illegal, especially when such terms provide for conclusive arbitration clause.277

273

The mechanism for the adjustment and resolution of grievances arising from the interpretation or implementation of a CBA and those arising from the interpretation or enforcement of company personnel policies. It is part of the continuing process of collective bargaining. 274 Section 1 [d], Rule II, NCMB Revised Procedural Guidelines in the Conduct of Voluntary Arbitration Proceedings [Oct. 15, 2004]. 275 Hence, if the strike is founded on an unfair labor practice of the employer, a strike declared by the union cannot be considered a violation of the no strike clause. (Master Iron Labor Union v. NLRC, G.R. No. 92009, Feb. 17, 1993) 276 MSMG-UWP vs. Ramos, 326 SCRA 428 (2000), citing Master Iron Labor Union vs. NLRC 219 SCRA 47 [1993]). 277 Filcon Manufacturing Corporation vs. Lakas Manggagawa sa Filcon-Lakas Manggagawa Labor Center [LMF-LMLC], G. R. No. 150166, July 26, 2004.

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(4) Labor Management Council The Department shall promote the formation of labor management councils in organized and unorganized establishments to enable the workers to participate in policy and decision making processes in the establishment, insofar as said processes will directly affect their rights, benefits and welfare, except those which are covered by collective bargaining agreements or are traditional areas of bargaining. The Department shall promote other labor schemes and, upon its own initiative or upon the request of both formulation and development of programs and projects on safety and health, improvement of quality of work life, product other similar schemes.278 c. ULP in Collective Bargaining (1) Bargaining in bad faith The good faith or bad faith is an inference to be drawn from the facts and is largely a matter for the NLRCs expertise. The charge of bad faith should be raised while the bargaining is in progress.279 (2) Refusal to bargain A union violates its duty to bargain collectively by entering negotiations with a fixed purpose of not reaching an agreement or signing a contract. (3) Individual bargaining It is an unfair labor practice for an employer operating under a collective bargaining agreement to negotiate or to attempt to negotiate with his employees individually in connection with changes in the agreement. The basis of the prohibition regarding individual bargaining with the strikers is that although the union is on strike, the employer is still under obligation to bargain with the union as the employees' bargaining representative.280 (4) Blue sky bargaining It means making exaggerated or unreasonable proposals.281
278 279

management cooperation parties, may assist in the productivity, occupational quality improvement, and

Sec. 1, Rule XXI, Book V, IRR Instances: 1. Delay of negotiations 2. Imposing time limit on negotiations 280 Melo Photo Supply Corporation vs. National Labor Relations Board, 321 U.S. 332 281 Arthur A. Sloane and Fred Witney, Labor Relations, 7th Edition 1991, p. 195

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(5) Surface bargaining It means going through the motions of negotiating without any legal intent to reach an agreement.282 It involves the question of whether or not the employers conduct demonstrates an unwillingness to bargain in good faith or is merely hard bargaining.283 Occurs when the employer constantly changes its position over the agreement. d. Unfair Labor Practice (1) ULP of Employers284 a. To interfere with, restrain or coerce employees in the exercise of their right to selforganization; b. To require as a condition of employment that a person or an employee shall not join a labor organization or shall withdraw from one to which he belongs;285 c. To contract out services or functions being performed by union members when such will interfere with, restrain or coerce employees in the exercise of their rights to selforganization;286. d. To initiate, dominate, assist or otherwise interfere with the formation or administration of any labor organization, including the giving of financial or other support to it or its organizers or supporters;287 e. To discriminate in regard to wages, hours of work and other terms and conditions of employment in order to encourage or discourage membership in any labor organization. Nothing in this Code or in any other law shall stop the parties from requiring membership in a recognized collective bargaining agent as a condition for employment, except those employees who are already members of another union at the time of the
Whether or not the union is engaged in bluesky bargaining is determined by the evidence presented by the union as to its economic demands. Thus, if the union requires exaggerated or unreasonable ec onomic demands, then it is guilty of ULP. (Standard Chartered Bank v. Confessor, G.R. No. 114974, June 16, 2004) 282 Standard Chartered Bank Employees Union [NUBE] vs. Confesor, G. R. No. 114974, June 16, 2004). 283 Ibid. 284 Only the officers and agents of corporations, associations or partnerships who have actually participated in, authorized or ratified unfair labor practices shall be held criminally liable. 285 a.k.a. yellow dog contract; 286 The act of an employer in having work or certain services or functions being performed by union members contracted out is not generally an unfair labor practice act. It is only when the contracting out of a job, work or service being performed by union members will interfere with, restrain or coerce employees in the exercise of their right to self-organization that it shall be unlawful and shall constitute unfair labor practice (Art. 248 [c], LC; Sec. 6 [f], Department Order No. 18-02, Series of 2002, [Feb. 21, 2002). 287 a.k.a. company union

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signing of the collective bargaining agreement. Employees of an appropriate bargaining unit who are not members of the recognized collective bargaining agent may be assessed a reasonable fee equivalent to the dues and other fees paid by members of the recognized collective bargaining agent, if such non-union members accept the benefits under the collective bargaining agreement: Provided, that the individual authorization required under Article 242, paragraph (o) of this Code shall not apply to the non-members of the recognized collective bargaining agent; f. To dismiss, discharge or otherwise prejudice or discriminate against an employee for having given or being about to give testimony under this Code; g. To violate the duty to bargain collectively as prescribed by this Code; h. To pay negotiation or attorneys fees to the union or its officers or agents as part of the settlement of any issue in collective bargaining or any other dispute; or i. To violate a collective bargaining agreement.288 (2) ULP of Labor Organizations a. To restrain or coerce employees in the exercise of their right to selforganization. However, a labor organization shall have the right to prescribe its own rules with respect to the acquisition or retention of membership; b. To cause or attempt to cause an employer to discriminate against an employee, including discrimination against an employee with respect to whom membership in such organization has been denied or to terminate an employee on any ground other than the usual terms and conditions under which membership or continuation of membership is made available to other members; c. To violate the duty, or refuse to bargain collectively with the employer, provided it is the representative of the employees; d. To cause or attempt to cause an employer to pay or deliver or agree to pay or deliver any money or other things of value, in the nature of an exaction, for services which are not performed or not to be performed, including the demand for fee for union negotiations;289 e. To ask for or accept negotiation or attorneys fees from employers as part of the settlement of any issue in collective bargaining or any other dispute; or f. To violate a collective bargaining agreement.

288 289

but only if gross in character a.k.a. feather-bedding

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3. Right to Peaceful Concerted Activities a. Forms of Concerted Activities Strike290 Any temporary stoppage of work by the concerted action of the employees as a result of an industrial or labor dispute. It consists not only of concerted work stoppages but also slowdowns, mass leaves, sitdowns, attempts to damage, destroy or sabotage plant equipment and facilities and similar activities. Lockout291 Any temporary refusal of an employer to furnish work as a result of an industrial or labor dispute. Picketing292 The right of workers to peacefully march to and fro before an establishment involved in a labor dispute generally accompanied by the carrying and display of signs, placards and banners intended to inform the public about the dispute.

290

Summary of principles governing strikes: 1. A strike or lockout is illegal if any of the legal requisites (enumerated above) is not complied with. Procedural requirements are mandatory. 2. A strike or lockout is illegal if it is based on non-strikeable issues (e.g., inter-union or intra-union disputes or wage distortion). 3. A strike or lockout is illegal if the issues involved are already subject of compulsory or voluntary arbitration or conciliation or the steps in grievance machinery are not exhausted. 4. A strike or lockout is illegal if unlawful means were employed or prohibited acts or practices were committed (e.g., Use of force, violence, threats, coercion, etc.; Barricades, blockades and obstructions of ingress to [entrance] or egress from [exit] the company premises). 5. A strike or lockout is illegal if the notice of strike or notice of lockout is already converted into a preventive mediation case. (See further discussion below). 6. A strike or lockout is illegal if staged in violation of the No-Strike, No-Lockout clause in the collective bargaining agreement. 7. A strike or lockout is illegal if staged in violation of a temporary restraining order or an injunction or assumption or certification order. 8. A strike is illegal if staged by a minority union. 9. A strike or lockout is illegal if conducted for unlawful purpose/s (e.g.: Strike to compel dismissal of employee or to compel the employer to recognize the union or the so-called Union-Recognition Strike) 10. The local union and not the federation is liable to pay damages in case of illegal strike. 291 Grounds for Lockout 1. Collective bargaining deadlock 2. ULP act of a union 292 or peaceful picketing

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b. Who may declare a strike or lockout? 1.Any certified or duly recognized bargaining representative may declare a strike in cases of bargaining deadlock and unfair labor practice. Likewise, the employer may declare a lockout in the same cases. 2. In the absence of a certified or duly recognized bargaining representative, any legitimate labor organization in the establishment may declare a strike but only on the ground of unfair labor practice.293 c. Requisites for a valid strike d. Requisites for a valid lockout 1. It must be based on a valid and factual ground; 2. A strike or lockout NOTICE shall be filed with the National Conciliation and Mediation Board (NCMB) at least 15 days before the intended date of the strike or lockout if the issues raised are unfair labor practices, or at least 30 days before the intended date thereof if the issue involves bargaining deadlock. 3. In cases of dismissal from employment of union officers duly elected in accordance with the union constitution and bylaws, which may constitute union busting where the existence of the union is threatened, the 15day cooling off period shall not apply and the union may take action immediately after the strike vote is conducted and the result thereof submitted to the Department of Labor and Employment. 4. A strike must be approved by a majority vote of the members of the Union and a lockout must be approved by a majority vote of the members of the Board of Directors of the Corporation or Association or of the partners in a partnership, obtained by secret ballot in a meeting called for that purpose. 5. A strike or lockout vote shall be reported to the NCMB DOLE Regional Branch at least 7 days before the intended strike or lock-out subject to the cooling off period. 6. In the event the result of thestrike/lockout ballot is filed within the coolingoff period, the 7day requirement shall be counted from the day following the expiration of the coolingoff period.294 In case of dismissal from employment of union officers which may constitute union busting, the time requirement for the filing of the Notice of Strike shall be dispensed with but the strike vote requirement, being mandatory in character, shall in every case be complied with.
293 294

Sec. 2, Rule XIII Book V, Omnibus Rules Implementing The Labor Code, as amended NSFW vs. Ovejera, G.R. No. 59743, May 31, 1982

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7. The dispute must not be the subject of an assumption of jurisdiction by the President or the Secretary of Labor and Employment, a certification for compulsory arbitration, or submission to compulsory or voluntary arbitration nor a subject of a pending case involving the same grounds for the strike or lockout. e. Requisites for lawful picketing No person engaged in picketing shall commit any act of violence, coercion or intimidation or obstruct the free ingress to or egress from the employers premises for lawful purposes, or obstruct public thoroughfares.295 f. Assumption of jurisdiction by the Secretary of Labor or Certification of the Labor dispute to the NLRC for compulsory arbitration 1. On intended or impending strike or lockout - automatically enjoined even if a Motion for Reconsideration is filed. 2. On actual strike or lockout - strikers or locked out employees should immediately return to work and employer should readmit them back. 3. On cases filed or may be filed - All shall be subsumed/absorbed by the assumed or certified case except when the order specified otherwise. The parties to the case should inform the DOLE Secretary of pendency thereof. g. Nature of Assumption Order or Certification Order The DOLE Secretary may assume jurisdiction over a labor dispute, or certify it to the NLRC for compulsory arbitration, if, in his opinion, it may cause or likely to cause a strike or lockout in an industry indispensable to the national interest. 296 h. Effect of defiance of Assumption or Certification Orders A strike that is undertaken after the issuance by the Secretary of Labor and Employment of an assumption or certification order becomes a prohibited activity and thus illegal, pursuant to the second paragraph of Article 264297 of the Labor Code. The union officers and members, as a result, are deemed to have lost their employment status for having knowingly participated in an illegal strike. Stated differently, from the moment a worker defies a return-to-work order, he is deemed to have abandoned his job. The loss of employment results from the striking employees own act - an act which is illegal, an act in violation of the law and in defiance of authority.298

295 296

Art. 264 (e), as amended The President may also exercise the power to assume jurisdiction over a labor dispute 297 See Reference 298 Philippine Airlines, Inc. vs. Brillantes, G. R. No. 119360, Oct. 10, 1997

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i. Illegal Strike (1) Liability of officers of the unions Only the union officers during the strike are liable. The penalty of dismissal could be imposed only on union officers serving and acting as such during the period of illegal strike299. As a necessary implication, if employees acted as union officers after said strike, they may not be held liable and, therefore, could not be terminated.300 (2) Liability of ordinary workers The mere declaration of the illegality of strike would result in the termination of employment of union officers. They are deemed to have lost their employment status. This adverse consequence does not apply to ordinary union members except when they participated in the commission of illegal acts in the course of the strike, in which case, they shall be deemed to have also lost their employment status. (3) Waiver of illegality of strike When an employer accedes to the peaceful settlement brokered by the NLRC by agreeing to accept all employees who had not yet returned to work, it waives the issue of the illegality of the strike.301 j. Injunctions (1) Requisites for Labor Injunctions No temporary or permanent injunction or restraining order in any case involving or growing out of labor disputes shall be issued by any court or other entity. Exceptions: 1. When prohibited or unlawful acts are being or about to be committed that will cause grave or irreparable damage to the complaining party.302 2. On the ground of national interest 3. The SLE or the NLRC may seek the assistance of law enforcement agencies to ensure compliance with this provision as well as with such orders as he may issue to enforce the same.303
299 300

Lapanday Workers Union vs. NLRC, 248 SCRA 95, 106. CCBPI Postmix Workers Union vs. NLRC, G. R. No. 114521, Nov. 27, 1998 301 Reformist Union v. NLRC, G.R. No. 120482,Jan. 27, 1997 302 Art. 218[e]

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(2) "Innocent Bystander Rule" The innocent by stander must show: 1. Compliance with the grounds specified in Rule 58 of the Rules of Court, and 2. That it is entirely different from, without any connection whatsoever to, either party to the dispute and, therefore, its interests are totally foreign to the context thereof.304

303 304

Art. 263[g] MSF Tire & Rubber v. CA, G.R. 128632, Aug. 5, 1999

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H. PROCEDURE AND JURISDICTION 1. Labor Arbiter a. Jurisdiction305 Exclusive and original jurisdiction to hear and decide the following cases306 invol ving all workers: 1. ULP cases 2. Termination disputes 3. If accompanied with a claim for reinstatement, those that workers file involving wages, rates of pay, hours of work and other terms and conditions of employment 4.Claims for actual, moral, exemplary and other forms of damages arising fro m employeremployee relations 5. Cases arising from any violation of Art. 264,307 including questions involving the legality of strikes and lockouts; 6. Except claims for Employment Compensation, Social Security, Philhealth and maternity benefits, all other claims arising from employer-employee relations, including those of persons in domestic or household service, involving an amount exceeding P5000 regardless of whether accompanied with a claim for reinstatement 7. Monetary claims of overseas contract workers arising from employer employee relations under the Migrant Workers Act of 1995 as amended by R.A. 10022

305 306

The jurisdiction is original and exclusive in nature. Labor Arbiters have no appellate jurisdiction. Including the following cases: 1. Wage distortion cases only in unorganized establishments. In organized establishments, jurisdiction is vested with Voluntary Arbitrators. 2. All monetary claims of Overseas Filipino Workers arising from employer- employee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment, including claims for actual, moral, exemplary and other forms of damages. 3. Illegal dismissal cases of employees of cooperatives, but not members of cooperatives because they are not employees. 4. Cases involving employees of government-owned or controlled corporations without original charters (organized under the Corporation Code). They have no jurisdiction if entity has original charter. Labor Arbiters have no jurisdiction over termination of corporate officers and stockholders which, under the law, is considered intra-corporate dispute. Labor Arbiters have no jurisdiction over labor cases involving entities immune from suit. Exception: when said entities perform proprietary activities (as distinguished from governmental functions). 307 See Reference

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8. Wage distortion disputes in un organized establishments not voluntarily settled by the parties pursuant to R.A. 6727 9. Enforcement of compromise compliance by any of the parties; and 10. Other cases as may be provided by law. b. Effect of self-executing order of reinstatement on backwages The decision of the LA reinstating a dismissed or separated employee, shall be executory, even pending appeal:308 The employee shall either be: 1. Admitted back to work under the same terms and conditions prevailing prior to the dismissal or separation; or 2. At the option of the employer, merely reinstated into the payroll. c. Requirements to perfect appeal to NLRC309 1. The appeal is perfected: a. Filed within the reglementary period provided in Sec. 1 of this Rules b. Verified by the appellant himself in accordance with Sec. 4, Rule 7 of the Rules of Court, as amended c. In the form of a memorandum of appeal which shall state the grounds relied upon and the arguments in support thereof, the relief prayed for, and with a statement of the date the appellant received the appealed decision, resolution or order d. In 3 legibly typewritten or printed copies
308

agreements when

there

is

non

The posting of a bond by the employer shall not stay the execution of reinstatement Even if the order of reinstatement of the LA is reversed on appeal, it is obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee during the period of appeal until reversal by the higher court. On the other hand, if the employee has been reinstated during the appeal period and such reinstatement order is reversed with finality, the employee is not required to reimburse whatever salary he received for he is entitled to such, more so if he actually rendered services during the period. (Pfizer v. Velasco, G.R. No. 177467, March 9, 2011) Unless there is a restraining order, it is ministerial upon the LA to implement the order of reinstatement and it is mandatory on the employer to comply therewith. (Garcia v. PAL, G.R. No. 164856, Jan. 20, 2009) 309 Appeal from the decision of the Labor Arbiter is brought by ordinary appeal to the NLRC within ten (10) calendar days from receipt by the party of the decision.

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e. Accompanied by (i) proof of payment of the required appeal fee; (ii) posting of a cash or surety bond; (iii) a certificate of nonforum shopping; and (iv) proof of service upon the other parties. 2. Mere notice of appeal without complying with the other requisites aforestated shall not stop the running of the period for perfecting an appeal. 2. National Labor Relations Commission (NLRC) a. Jurisdictions310 Exclusive Original 1. Injunction in ordinary labor disputes to enjoin or restrain any actual or threatened commission of any or all prohibited or unlawful acts or to require the performance of a particular act in any labor dispute which, if not restrained or performed forthwith, may cause grave or irreparable damage to any party. 2. Injunction in strikes or lockouts under Article 264 of the Labor Code. 3. Certified labor disputes causing or likely to cause a strike or lockout in an industry indispensable to the national interest, certified to it by the Secretary of Labor and Employment for compulsory arbitration. Exclusive Appellate 1. All cases decided by the Labor Arbiters including contempt cases. 2. Cases decided by the DOLE Regional Directors or his duly authorized Hearing Officers311 involving recovery of wages, simple money claims and other benefits not exceeding P5,000 and not accompanied by claim for reinstatement.

310

Distinction between the jurisdiction of the Labor Arbiters and the NLRC. The NLRC has exclusive appellate jurisdiction on all cases decided by the Labor Arbiters. The NLRC does not have original jurisdiction on the cases over which Labor Arbiters have original and exclusive jurisdiction (see above enumeration). If a claim does not fall within the exclusive original jurisdiction of the Labor Arbiter, the NLRC cannot have appellate jurisdiction thereover. 311 under Art. 129

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b. Effect of NLRC reversal of Labor Arbiters order of reinstatement Even if the order of reinstatement of the Labor Arbiter is reversed on appeal, it is obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee during the period of appeal until reversal by the higher court. On the other hand, if the employee has been reinstated during the appeal period and such reinstatement order is reversed with finality, the employee is not required to reimburse whatever salary he received for he is entitled to such, more so if he actually rendered services during the period. In other words, a dismissed employee whose case was favorably decided by the Labor Arbiter is entitled to receive wages pending appeal upon reinstatement, which is immediately executory. Unless there is a restraining order, it is ministerial upon the Labor Arbiter to implement the order of reinstatement and it is mandatory on the employer to comply therewith. c. Requirements to perfect appeal to Court of Appeals Generally, certiorari as a special civil action will not lie unless a motion for reconsideration is filed before the NLRC to allow it an opportunity to correct its imputed error. Under Section 4, Rule 65312 of the Rules of Civil Procedure, the petition must be filed within sixty (60) days from notice of the judgment or from notice of the resolution denying the petitioners motion for reconsideration. This amendment is effective September 1, 2000, but being curative may be given retroactive application.313 The period within which a petition for certiorari against a decision of the NL RC may be filed should be computed from the date counsel of record of the party receives a copy of the decision or resolution, and not from the date the party himself receives a copy thereof. Article 224 of the Labor Code, which requires that copies of final decisions, orders or awards be furnished not only the partys counsel of record but also the party himself applies to the execution thereof and not to the filing of an appeal or petition for certiorari.314

312 313

as amended by A.M. No. 00203SC Narzoles v. NLRC, G.R. No. 141959, Sep. 29, 2000 314 Ginete v. Sunrise Manning Agency, G.R. No. 142023, June 21, 2001

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3. Bureau of Labor Relations (BLR) Med Arbiters a. Jurisdiction The BLR has original and exclusive jurisdiction over the following: 1. Inter-union disputes or representation disputes which refer to cases involving petition for certification election filed by a duly registered labor organization which is seeking to be recognized as the sole and exclusive bargaining agent of the rank-and-file employees in the appropriate bargaining unit of a company, firm or establishment. 2. Intra-union disputes or internal union disputes which refer to disputes or grievances arising from any violation of or disagreement over any provision of the constitution and by-laws of the union, including any violation of the rights and conditions of union membership provided for in the Labor Code. 3. All disputes, grievances or problems arising from or affecting labor-management relations in all workplaces, except those arising from the interpretation or implementation of the CBA which are subject of grievance procedure and/or voluntary arbitration. The BLR no longer handles all labor management disputes; rather its functions and jurisdiction are largely confined to: 1. Union matters 2. Collective bargaining registry and 3. Labor education

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4. National Conciliation and Mediation Board (NCMB) a. Conciliation vs. Mediation Conciliation Mediation

Conceived of as a mild form of intervention A mild intervention by a neutral third by a neutral third party party The conciliatorMediator, relying on his persuasive expertise, who takes an active role in assisting parties by trying to keep disputants talking, facilitating other procedural niceties, carrying messages back and forth between the parties, and generally being a good fellow who tries to keep things calm and forwardlooking in a tense situation. It is the process where a disinterested 3rd party meets with management and labor, at their request or otherwise, during a labor dispute or in collective bargaining conferences, and by cooling tempers, aids in reaching an agreement. b. Preventive Mediation Refer to the potential labor disputes which are the subject of a formal or informal request for conciliation and mediation assistance sought by either or both parties or upon the initiative of the NCMB to avoid the occurrence of actual labor disputes. The conciliator-mediator, whereby he Starts advising the parties or offering solutions or alternatives to the problems with the end in view of assisting them towards voluntarily reaching their own mutually acceptable settlement of the dispute.

It is when a 3rd party studies each side of the dispute then makes proposals for the disputants to consider. The mediator cannot make an award nor render a decision.

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5. DOLE Regional Directors a. Small money claims The Regional Director or any of the duly authorized hearing officers of DOLE have jurisdiction over claims for recovery of wages, simple money claims and other benefits, provided that: i. the claim must arise from employer-employee relationship; ii. the claimant does not seek reinstatement; and iii. the aggregate money claim of each employee does not exceed P5,000.00 315 6. DOLE Secretary a. Visitorial and Enforcement Powers316 Visitorial Powers 1. Access to employers records and premises at any time of the day or night, whenever work is being undertaken therein 2. To copy from said records 3. Question any employee and investigate any fact, condition or matter which may be necessary to determine violations or which may aid in the enforcement of the Labor Code and of any labor law, wage
315 316

Enforcement Powers 1. Issue compliance orders 2. Issue writs of execution for the enforcement of their orders, except in cases where the employer contests the findings of the labor officer and raise issues supported by documentary proof which were not considered in the course of inspection 3.Order stoppage of work or suspension of operation when non

Article 129 Visitorial and enforcement power by Secretary of Labor or duly authorized representative 1. Access to employer's records and premises 2. Right to copy records 3. Right to question any employee 4. Investigate any fact, condition or matter which may be necessary to 5. Order and administer, after due notice and hearing, compliance with the Labor Standards provisions 6. Issue writs of execution to the appropriate authority for enforcement of their orders 7. Order stoppage of work or suspension of operations when non-compliance with law and implementing regulations poses grave and imminent danger to the health and safety of workers in the workplace (only Secretary of Labor has this power) - Hearing within 24 hours - Employer liable for salaries during suspension of operations if found to have caused the violation - No TRO or Temporary/Permanent injunction may be issued by an inferior court over any case involving the enforcement orders issued

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order, or rules and regulation issued pursuant thereto.

compliance with the law or implementing rules and regulations poses grave and immi nent danger to health and safety of workers in the workplace

b. Power to suspend effects of termination The Secretary of the Department of Labor may suspend the effects of the termination pending resolution of the dispute in the event of a prima facie finding by the appropriate official of the Department of Labor and Employment before whom such dispute is pending that the termination may cause a serious labor dispute or is in implementation of a mass lay-off.317 7. Voluntary Arbitrators The Voluntary Arbitrator318 has original and exclusive jurisdiction over the following: i. all unresolved grievances arising from the interpretation or implementation of the collective bargaining agreement after exhaustion of the grievance procedure; and ii. all unresolved grievances arising from the implementation or interpretation of company personnel policies.319 iii. all other labor disputes including unfair labor practices and bargaining deadlocks, upon agreement of the parties.320 a. Submission Agreement It is the policy of the state to encourage voluntary arbitration on all other labormanagement disputes. Before or at any stage of the compulsory arbitration process, the parties may opt to submit their dispute to voluntary arbitration. 321 b. Rule 43, Rules of Court The decision of a Voluntary Arbitrator or panel of Voluntary Arbitrators is appealable by ordinary appeal under Rule 43 of the Rules of Civil Procedure directly to the Court of Appeals. From the Court of Appeals, the case may be elevated to the Supreme Court by way of ordinary appeal under the same Rule 45.322

317 318

Art. 277, last sentence or panel of Voluntary Arbitrators 319 Art. 261 320 Art. 262 321 Bk. V, Rule II, Sec. 3, OR 322 Luzon Development Bank vs. Association of Luzon Development Bank Employees, et al., G. R. No. 120319, October 6, 1995.

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8. Court of Appeals a. Rule 65, Rules of Court A party may avail itself of the civil action for certiorari, where the tribunal, board or office exercising juridical functions: Has acted without or in excess of jurisdiction; and, or With grave abuse of discretion and praying that judgments be rendered annulling or modifying the proceedings, as the law requires, of such tribunal, board or officer It may be filed not later than 60 days from notice of the judgment, order or resolution. Both SC and CA has jurisdiction over the action; however in line with the doctrine of minatory of warts, the petition should initially be presented to the lower of the two courts, that is, the CA. 9. Supreme Court a. Rule 45, Rules of Court A party desiring to appeal by certiorari from a judgment or final order or resolution of the Court of Appeals, the Sandiganbayan, the Regional Trial Court or other courts whenever authorized by law, may file with the Supreme Court a verified petition for review on certiorari. The petition shall raise only questions of law which must be distinctly set forth.323 10. Prescription of Actions a. Money claims - three (3) years from accrual of cause of action. b. Illegal dismissal four (4) years from accrual of cause of action. c. Unfair labor practice - 1 year from accrual of the cause of action. d. Offenses penalized by the Labor Code and IRR issued pursuant thereto three (3) years Include: Pertinent Supreme Court decisions up to January 31, 2012.

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Sec. 1

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Reference
Article 34. Prohibited practices. It shall be unlawful for any individual, entity, licensee, or holder of authority: To charge or accept, directly or indirectly, any amount greater than that specified in the schedule of allowable fees prescribed by the Secretary of Labor, or to make a worker pay any amount greater than that actually received by him as a loan or advance; To furnish or publish any false notice or information or document in relation to recruitment or employment; To give any false notice, testimony, information or document or commit any act of misrepresentation for the purpose of securing a license or authority under this Code. To induce or attempt to induce a worker already employed to quit his employment in order to offer him to another unless the transfer is designed to liberate the worker from oppressive terms and conditions of employment; To influence or to attempt to influence any person or entity not to employ any worker who has not applied for employment through his agency; To engage in the recruitment or placement of workers in jobs harmful to public health or morality or to the dignity of the Republic of the Philippines; To obstruct or attempt to obstruct inspection by the Secretary of Labor or by his duly authorized representatives; To fail to file reports on the status of employment, placement vacancies, remittance of foreign exchange earnings, separation from jobs, departures and such other matters or information as may be required by the Secretary of Labor. To substitute or alter employment contracts approved and verified by the Department of Labor from the time of actual signing thereof by the parties up to and including the periods of expiration of the same without the approval of the Secretary of Labor; To become an officer or member of the Board of any corporation engaged in travel agency or to be engaged directly or indirectly in the management of a travel agency; and To withhold or deny travel documents from applicant workers before departure for monetary or financial considerations other than those authorized under this Code and its implementing rules and regulations. ARTICLE 110. Worker preference in case of bankruptcy. - In the event of bankruptcy or liquidation of an employers business, his workers shall enjoy first preference as regards their wages and other monetary claims, any provisions of law to the contrary notwithstanding. Such unpaid wages and monetary claims shall be paid in full before claims of the government and other creditors may be paid. (As amended by Section 1, Republic Act No. 6715, March 21, 1989).

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ARTICLE 129. Recovery of wages, simple money claims and other benefits. - Upon complaint of any interested party, the Regional Director of the Department of Labor and Employment or any of the duly authorized hearing officers of the Department is empowered, through summary proceeding and after due notice, to hear and decide any matter involving the recovery of wages and other monetary claims and benefits, including legal interest, owing to an employee or person employed in domestic or household service or househelper under this Code, arising from employer-employee relations: Provided, That such complaint does not include a claim for reinstatement: Provided further, That the aggregate money claims of each employee or househelper does not exceed Five thousand pesos (P5,000.00). The Regional Director or hearing officer shall decide or resolve the complaint within thirty (30) calendar days from the date of the filing of the same. Any sum thus recovered on behalf of any employee or househelper pursuant to this Article shall be held in a special deposit account by, and shall be paid on order of, the Secretary of Labor and Employment or the Regional Director directly to the employee or househelper concerned. Any such sum not paid to the employee or househelper because he cannot be located after diligent and reasonable effort to locate him within a period of three (3) years, shall be held as a special fund of the Department of Labor and Employment to be used exclusively for the amelioration and benefit of workers. Any decision or resolution of the Regional Director or hearing officer pursuant to this provision may be appealed on the same grounds provided in Article 223 of this Code, within five (5) calendar days from receipt of a copy of said decision or resolution, to the National Labor Relations Commission which shall resolve the appeal within ten (10) calendar days from the submission of the last pleading required or allowed under its rules. The Secretary of Labor and Employment or his duly authorized representative may supervise the payment of unpaid wages and other monetary claims and benefits, including legal interest, found owing to any employee or househelper under this Code. (As amended by Section 2, Republic Act No. 6715, March 21, 1989). ARTICLE 217. Jurisdiction of the Labor Arbiters and the Commission. (a) Except as otherwise provided under this Code, the Labor Arbiters shall have original and exclusive jurisdiction to hear and decide, within thirty (30) calendar days after the submission of the case by the parties for decision without extension, even in the absence of stenographic notes, the following cases involving all workers, whether agricultural or non- agricultural: 1. Unfair labor practice cases; 2. Termination disputes 3. If accompanied with a claim for reinstatement, those cases that workers may file involving wages, rates of pay, hours of work and other terms and conditions of employment; 4. Claims for actual, moral, exemplary and other forms of damages arising from the employer- employee relations; 5. Cases arising from any violation of Article 264 of this Code, including questions involving the legality of strikes and lockouts; and 6. Except claims for Employees Compensation, Social Security, Medicare and maternity benefits, all other claims arising from employer-employee relations, including those of persons in domestic or household service, involving an amount exceeding five thousand pesos (P5,000.00) regardless of whether accompanied with a claim for reinstatement. (b) The Commission shall have exclusive appellate jurisdiction over all cases decided by Labor Arbiters. 105

(c) Cases arising from the interpretation or implementation of collective bargaining agreement and those arising from the interpretation or enforcement of company personnel policies shall be disposed of by the Labor Arbiter by referring the same to the grievance machinery and voluntary arbitration as may be provided in said agreements. (As amended by Section 9, Republic Act No. 6715, March 21, 1989). ARTICLE 279. Security of tenure. - In cases of regular employment, the employer shall not terminate the services of an employee except for a just cause or when authorized by this Title. An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages, inclusive of allowances, and to his other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of Any union officer who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status: Provided, That mere participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his employment, even if a replacement had been hired by the employer during such lawful strike. ARTICLE 264. Any union officer who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status: Provided, That mere participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his employment, even if a replacement had been hired by the employer during such lawful strike. (paragraph 2)

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