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JUSTICE VICENTE S.E. VELOSO whose actual hours of work cannot be estimated with certainty; this includes in its scope “unsupervised employees” [Mercidar Fishing Corporation v. NLRC, 297 SCRA 440 (1998)] NOTES: Field personnel exempt from coverage because the actual time spent on work cannot be determined with reasonable certainty. Supervised employee cannot be considered as field personnel. Those paid by results, piece-work, pakyaw or task basis – no longer under the same category as those above (Labor Congress v. NLRC, 290 SCRA 509) Benefits to which Piece-Rate Workers are entitled to: (HANS MOTO) Holiday Pay Applicable Statutory Minimum Daily Rate Night Differential Pay Service Incentive Leave Meal and Rest Periods Overtime Pay Thirteenth Month Pay Other Benefits NOTE: Coverage under Art. 82 refers only to the benefits provided by Arts. 83 – 93. ART. 83. NORMAL HOURS OF WORK. The normal hours of work of any employee shall not exceed eight (8) hours a day. Health personnel in cities and municipalities with a population of at least one million (1,000,000) or in hospitals and clinics with a bed capacity of at least one hundred (100) shall hold regular office hours for eight (8) hours a day, for five (5) days a week, exclusive of time for meals, except where the exigencies of the service require that such personnel work for six (6) days or forty-eight (48) hours, in which case, they shall be entitled to an additional compensation of at least thirty percent (30%) of their regular wage for work on the sixth day. For purposes of this Article, "health personnel" shall include resident physicians, nurses, nutritionists, dietitians, pharmacists, social workers, laboratory technicians, paramedical technicians, psychologists, midwives, attendants and all other hospital or clinic personnel.
BOOK III: LABOR STANDARDS TITLE I: WORKING CONDITIONS & REST PERIODS HOURS OF WORK
ART. 82. COVERAGE The provisions of this Title shall apply to employees in all establishments and undertakings whether for profit or not, but not to government employees, managerial employees, field personnel, members of the family of the employer who are dependent on him for support, domestic helpers, persons in the personal service of another, and workers who are paid by results as determined by the Secretary of Labor in appropriate regulations. As used herein, "managerial employees" refer to those whose primary duty consists of the management of the establishment in which they are employed or of a department or subdivision thereof, and to other officers or members of the managerial staff. "Field personnel" shall refer to 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. Exempt: Government employees Managerial employees Members of the employer’s family dependent on him for support Domestic Servants Field personnel regularly performing duties away from office Managerial Employees primary duty is management customarily and regularly directing work of 2 or more employees with authority to hire suggestions given particular weight include officers or members of the managerial staff Field Personnel non agricultural employees who regularly perform their duties away from the office and
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LABOR LAW 1 (POST-MIDTERMS) NOTES: Rationale: To safeguard the health and welfare of the employee; also to minimize unemployment Parties can validly agree to 9 hours per day as the normal hours of work, but the employer must still give overtime pay for the extra 1 hour. If the agreed normal hours of work is 6 hours per day, work on the 7th hour entitles the employee to overtime pay. Only employees paid on a daily basis are entitled to 8-hour pay. ART. 84. HOURS WORKED. Hours worked shall include (a) all time during which an employee is required to be on duty or to be at a prescribed workplace; and (b) all time during which an employee is suffered or permitted to work. Rest periods of short duration during working hours shall be counted as hours worked. ART. 85. MEAL PERIODS. Subject to such regulations as the Secretary of Labor may prescribe, it shall be the duty of every employer to give his employees not less than sixty (60) minutes time-off for their regular meals. Compensable Hours: (DSWP) Employee has been on Duty Employee has been Suffered to work Made to standby a particular Workplace Employee was Permitted to work Meal Time 60 minutes and above: not counted as working time Less than 60 minutes: counted as working time • minimum 20 minutes COUNTED AS WORKING TIME IF Integral part of work / required Engaged by the employer to wait EXCEPT
JUSTICE VICENTE S.E. VELOSO Required to remain on call in employer’s premises or close so that he cannot use the time effectively for his own purpose Subject to serious interruption Takes place under less desirable conditions than would be likely to exist at employee’s home Compensable Kept w/in through cell phones or other contact devices but must remain w/in a certain geographical area
WORKING WHILE SLEEPING
SUBJECT TO CALL
Voluntary Attendance Employee does not perform any productive work during attendance
TRAININGS, PROGRAMS, LECTURES, MEETINGS
Required by the employer Taken for the employer’s benefit
ART. 87. OVERTIME WORK. Work may be performed beyond eight (8) hours a day provided that the employee is paid for the overtime work, an additional compensation equivalent to his regular wage plus at least twentyfive percent (25%) thereof. Work performed beyond eight hours on a holiday or rest day shall be paid an additional compensation equivalent to the rate of the first eight hours on a holiday or rest day plus at least thirty percent (30%) thereof. ART. 88. UNDERTIME NOT OFFSET BY OVERTIME. Undertime work on any particular day shall not be offset by overtime work on any other day. Permission given to the employee to go on leave on some other day of the week shall not exempt the
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LABOR LAW 1 (POST-MIDTERMS) employer from paying the additional compensation required in this Chapter. ART. 89. EMERGENCY OVERTIME WORK. Any employee may be required by the employer to perform overtime work in any of the following cases: (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 it is necessary to prevent loss of life or property or in case of imminent danger to public safety due to an actual or impending emergency in the locality caused by serious accidents, fire, flood, typhoon, earthquake, epidemic, or other disaster or calamity; (c) When there is urgent work to be performed on machines, installations, or equipment, in order to avoid serious loss or damage to the employer or some other cause of similar nature; (d) When the work is necessary to prevent loss or damage to perishable goods; and (e) Where the completion or continuation of the work started before the eighth hour is necessary to prevent serious obstruction or prejudice to the business or operations of the employer. Any employee required to render overtime work under this Article shall be paid the additional compensation required in this Chapter. ART. 90. COMPUTATION OF ADDITIONAL COMPENSATION. For purposes of computing overtime and other additional remuneration as required by this Chapter, the "regular wage" of an employee shall include the cash wage only, without deduction on account of facilities provided by the employer. Overtime – work in excess of 8 hours Premium rate for Overtime: Normal 25% on top of hourly rate Holiday/Rest Day 30% Special Day 30% GR: Overtime compensation cannot be waived Exceptions: When waiver is in consideration of benefits and privileges which may be more than the OT pay Voluntarily agrees to work 9 hours No diminution in pay Value of benefits equal to or greater than 1hr. OT pay during weekdays
JUSTICE VICENTE S.E. VELOSO OT pay due and demandable even if permitted to work Saturdays Work doesn't involve strenuous physical exertion Temporary duration Emergency OT Work allowed when: 1) Country at war/National or Local Emergency 2) Completion of work started before the 8th hour and is necessary to prevent serious obstruction or prejudice to the business 3) Urgent work to be performed on Machines to avoid serious loss or damage to employer 4) Necessary to Prevent loss of life/property or Imminent danger to public safety 5) Necessary to prevent loss or damage to perishable goods 6) Necessary to avail of favorable weather or environmental condition In computing overtime pay, “regular wage” includes cash wage only, without deduction of facilities. Q: Is a supervisor entitled to overtime pay? To holiday pay? A supervisor is part of the managerial staff and therefore not entitled to overtime pay and other benefits, as provided in Articles 83 to 96. (National Sugar Refineries Corp. v. NLRC, 24 March 1993) Undertime The proper method should be to deduct the undertime hours from the accrued leave but to pay the employee the overtime compensation to which he is entitled. Where the employee has exhausted his leave credits, his undertime hours may simply be deducted from his day’s wage, but he should still be paid his overtime compensation for work in excess of eight hours a day. (NWSA v. NWSA Consolidated Union, 11 SCRA 766) Computation of Work Days Days in a year Less: Saturdays Equals Less: Sundays Equals Add: 10 legal holidays Total work days 365 (52) 313 (52) 261 10 271
Take note: Book III, Rule IV, Sec. 2 presumes that you are working the whole year. Computes
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LABOR LAW 1 (POST-MIDTERMS) monthly (365 / 12). So what happens is: 365 + 10 = 375 work days. The SC nullified Sec. 2 in the IBAA case. ART. 86. NIGHT SHIFT DIFFERENTIAL. Every employee shall be paid a night shift differential of not less than ten percent (10%) of his regular wage for each hour of work performed between ten o’clock in the evening and six o’clock in the morning. Night Shift Differential – work from 10pm-6am At least 10% of regular wage Does NOT apply to: Government Employees Retail Businesses with less than 5 workers Domestic Helpers Managerial Employees Field Personnel Rationale: Nighttime work cannot be considered desirable for the employee or the employer. Social life and family life are affected. There are also health and safety considerations. Overtime pay does NOT preclude payment of night differential.
JUSTICE VICENTE S.E. VELOSO to prevent loss of life and property, or imminent danger to public safety; (b) In cases of urgent work to be performed on the machinery, equipment, or installation, to avoid serious loss which the employer would otherwise suffer; (c) In the event of abnormal pressure of work due to special circumstances, where the employer cannot ordinarily be expected to resort to other measures; (d) To prevent loss or damage to perishable goods; (e) Where the nature of the work requires continuous operations and the stoppage of work may result in irreparable injury or loss to the employer; and (f) Under other circumstances analogous or similar to the foregoing as determined by the Secretary of Labor and Employment.
ART. 93. COMPENSATION FOR REST DAY, SUNDAY OR (a) Where an employee is made or permitted to work on his scheduled rest day, he shall be paid an additional compensation of at least thirty percent (30%) of his regular wage. An employee shall be entitled to such additional compensation for work performed on Sunday only when it is his established rest day. (b) When the nature of the work of the employee is such that he has no regular workdays and no regular rest days can be scheduled, he shall be paid an additional compensation of at least thirty percent (30%) of his regular wage for work performed on Sundays and holidays. (c) Work performed on any special holiday shall be paid an additional compensation of at least thirty percent (30%) of the regular wage of the employee. Where such holiday work falls on the employee’s scheduled rest day, he shall be entitled to an additional compensation of at least fifty per cent (50%) of his regular wage. (d) Where the collective bargaining agreement or other applicable employment contract stipulates the payment of a higher premium pay than that prescribed under this Article, the employer shall pay such higher rate. Premium Pay For Work On Rest Days / Special Days Rest Day - 30% Special Day - 30% (Aug. 21, Nov.1 & Dec. 31) Rest Day falls on Special Day - 50%
WEEKLY REST PERIODS
ART. 91. RIGHT TO WEEKLY REST DAY. (a) It shall be the duty of every employer, whether operating for profit or not, to 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. (b) 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. However, the employer shall respect the preference of employees as to their weekly rest day when such preference is based on religious grounds.
ART. 92. WHEN EMPLOYER MAY REQUIRE WORK ON A
The employer may require his employees to work on any day: (a) In case of actual or impending emergencies caused by serious accident, fire, flood, typhoon, earthquake, epidemic or other disaster or calamity
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LABOR LAW 1 (POST-MIDTERMS) For special day: NO WORK, NO PAY Authorized Work on a Rest Day allowed when: (UAAP NA) Urgent work to be performed on machinery Actual impending emergency Abnormal pressure or work Prevent loss/damage to perishable goods Nature of work requires continuous operations Analogous situations
JUSTICE VICENTE S.E. VELOSO Retail and Service Establishments regularly employing less than 10 Domestic helpers Managerial employees Field Personnel Hourly Paid Faculty Members Q: May a Christian not report for work on the days designated by law as Muslim holidays? What about a Muslim who is not working within the Muslim area? Yes. Presidential Decree No. 1083 provides that Muslims and Christians working within the Muslim areas may not report for work on the days designated by law as Muslim holidays. The law also provides that Muslim employees working outside the Muslim provinces and cities shall be excused from reporting for work during the observance of the Muslim holidays as recognized by law, without diminution of salary or wages during the period. Special holidays apply to all covered employees within the area San Miguel Corporation v. CA, G.R. No. 146775, January 30, 2002 There should be no distinction between Muslims and non-Muslims as regards payment of benefits for Muslim holidays. Considering that all private corporations, offices, agencies, and entities or establishments operating within the designated Muslim provinces and cities are required to observe Muslim holidays, both Muslim and Christians working within the Muslim areas may not report for work on the days designated by law as Muslim holidays. Q: What is the rule in successive regular holidays? Where there are two successive regular holidays, an employee may not be paid for both holidays if he absents himself from work on the day immediately preceding the first holiday, unless he works on the first holiday, in which case, he is entitled to his holiday pay on the second holiday. Asian Transmission Corp. v. CA, G.R. No. 144664, March 15, 2004 Holiday pay is a legislated benefit. Its purpose is not merely to prevent diminution of the monthly income of the workers on account of work interruptions. Although the worker is forced to take a rest, he earns what he should
ART. 94. RIGHT TO HOLIDAY PAY. (a) Every worker shall be paid his regular daily wage during regular holidays, except in retail and service establishments regularly employing less than ten (10) workers; (b) 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; and (c) As used in this Article, "holiday" includes: New Year’s Day, Maundy Thursday, Good Friday, the ninth of April, the first of May, the twelfth of June, the fourth of July, the thirtieth of November, the twenty-fifth and thirtieth of December and the day designated by law for holding a general election. Holiday Pay Unworked Worked - if also Rest day
HOLIDAYS, SERVICE INCENTIVE LEAVES AND SERVICE CHARGES
100% 200% 230%
To avail of Holiday pay, employee should not have been absent without pay on the working day preceding the holiday. Legal/Regular Holidays: 1. New Year's Day - January 1 2. Maundy Thursday 3. Good Friday 4. Araw ng Kagitingan - April 9 5. Labor Day - May 1 6. Independence Day - June 12 7. National Heroes Day - Last Sun of August 8. Bonifacio Day - November 30 9. Christmas Day - December 25 10. Rizal Day - December 30 Does NOT apply to: Government employees
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LABOR LAW 1 (POST-MIDTERMS) earn. It is also intended to enable the worker to participate in the national celebrations held during the days identified as with great historical and cultural significance. Art. 94 of the Labor Code affords a worker the enjoyment of 10 paid regular holidays. The provision is mandatory, regardless of whether an employee is paid on a monthly or daily basis. Unlike a bonus, which is a management prerogative, holiday pay is a statutory benefit demandable under the law. Since a worker is entitled to the enjoyment of ten paid regular holidays, the fact that two holidays fall on the same date should not operate to reduce to nine the ten holiday pay benefits a worker is entitled to receive. ART. 95. RIGHT TO SERVICE INCENTIVE LEAVE. (a) Every employee who has rendered at least one year of service shall be entitled to a yearly service incentive leave of five days with pay. (b) This provision shall not apply to those who are already enjoying the benefit herein provided, those enjoying vacation leave with pay of at least five days and those employed in establishments regularly employing less than ten employees or in establishments exempted from granting this benefit by the Secretary of Labor and Employment after considering the viability or financial condition of such establishment. (c) The grant of benefit in excess of that provided herein shall not be made a subject of arbitration or any court or administrative action. Service Incentive Leave has worked for at least a year 5 days with pay commutable to its money equivalent if it’s not used or exhausted at the end of the year Does NOT apply to: (GADAM FEW) Government employees Already enjoying benefit Domestic Helpers and those in the personal service of another Already with vacation leave with pay of at least 5 days Managerial Employees Field Employees including those in Contract basis Employed in establishments regularly employing less than 10 employees
JUSTICE VICENTE S.E. VELOSO Works in establishments exempted from granting this benefit by the DOLE Secretary considering the viability or financial condition of such establishment. Q: When does an employee’s claim for accumulated service incentive leave prescribe? If the employee wishes to accumulate his leave credits and opts for its commutation upon his resignation or separation from employment, his cause of action to claim the whole amount of his accumulated service incentive leave shall arise when the employer fails to pay such amount at the time of his resignation or separation from employment. Applying Art. 291 of the Labor Code in light of this peculiarity of the service incentive leave, the 3-year prescriptive period commences, not at the end of the year when the employee becomes entitled to the commutation of his service incentive leave, but from the time when the employer refuses to pay its monetary equivalent after demand of commutation or upon termination of the employee’s services, as the case may be. (Auto Bus Transport Systems, Inc. vs. Antonio Bautista, 16 May 2005) Auto Bus Transport Systems v. Bautista, G.R. No. 156367, May 16, 2005 The grant of service incentive leave has been delimited by the Implementing Rules and Regulations of the Labor Code to apply only to those employees not explicitly excluded by Section 1 of Rule V. According to the Implementing Rules, Service Incentive Leave shall not apply to employees classified as “field personnel.” The phrase “other employees whose performance is unsupervised by the employer” must not be understood as a separate classification of employees to which service incentive leave shall not be granted. Rather, it serves as an amplification of the definition of field personnel under the Labor Code as those “whose actual hours of work in the field cannot be determined with reasonable certainty.” Employees engaged on task or contract basis or paid on purely commission basis are not automatically exempted from the grant of service incentive leave, unless, they fall under the classification of field personnel.
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LABOR LAW 1 (POST-MIDTERMS) JPL Marketing Promotions v. CA, G.R. No. 151966, July 8, 2005 Service incentive leave, as provided in Art. 95 of the Labor Code, is a yearly leave benefit of five (5) days with pay, enjoyed by an employee who has rendered at least one year of service. Unless specifically excepted, all establishments are required to grant service incentive leave to their employees. The term “at least one year of service” shall mean service within 12 months, whether continuous or broken reckoned from the date the employee started working. VACATION/SICK LEAVE - not required by law, but must be observed when stipulated in a CBA BONUS – amount granted and paid to an employee for his industry and loyalty, which contributed to the success of the employer’s business and made possible the realization of profits. GR : Act of Gratuity on the part of Employer; Can't be demanded Exceptions: 1. Given for a long period of time 2. Consistent & deliberate 3. Employer knew he was not required to give benefit 4. Employer realizes profits – depends if nature of benefit is dependent on profit Producers Bank Of The Philippines v. NLRC, G.R. No. 100701, March 28, 2001 A bonus is an amount granted and paid to an employee for his industry and loyalty which contributed to the success of the employer's business and made possible the realization of profits. It is an act of generosity granted by an enlightened employer to spur the employee to greater efforts for the success of the business and realization of bigger profits. The granting of a bonus is a management prerogative, something given in addition to what is ordinarily received by or strictly due the recipient. Thus, a bonus is not a demandable and enforceable obligation except when it is made part of the wage, salary or compensation of the employee However, an employer cannot be forced to distribute bonuses which it can no longer afford to pay. To hold otherwise would be to penalize the employer for his past generosity.
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JUSTICE VICENTE S.E. VELOSO To impose upon an employer already giving his employees the equivalent of a 13th month pay would be to penalize him for his liberality and in all probability, the employer would react by withdrawing the bonuses or resist further voluntary grants for fear that if and when a law is passed giving the same benefits, his prior concessions might not be given due credit. ART. 96. SERVICE CHARGES. All service charges collected by hotels, restaurants and similar establishments shall be distributed at the rate of eighty-five percent (85%) for all covered employees and fifteen percent (15%) for management. The share of the employees shall be equally distributed among them. In case the service charge is abolished, the share of the covered employees shall be considered integrated in their wages. 85% to Covered Employees – equally distributed among them, regardless of position or employment status 15% to Management – may answer for the losses and breakages, or may be distributed to managers. How about the supervisors? Supervisors share in the 15%. LC speaks of “management,” and not “managerial employees.” If the establishment does not impose service charge, it is deemed integrated into the wages.
TITLE II: WAGES
ART. 97. DEFINITIONS. As used in this Title: (a) "Person" means an individual, partnership, association, corporation, business trust, legal representatives, or any organized group of persons. (b) "Employer" includes any person acting directly or indirectly in the interest of an employer in relation to an employee and shall include the government and all its branches, subdivisions and instrumentalities, all government-owned or controlled corporations and institutions, as well as non-profit private institutions, or organizations. (c) "Employee" includes any individual employed by an employer. (d) "Agriculture" includes farming in all its branches and, among other things, includes
LABOR LAW 1 (POST-MIDTERMS) cultivation and tillage of soil, dairying, the production, cultivation, growing and harvesting of any agricultural and horticultural commodities, the raising of livestock or poultry, and any practices performed by a farmer on a farm as an incident to or in conjunction with such farming operations, but does not include the manufacturing or processing of sugar, coconuts, abaca, tobacco, pineapples or other farm products. (e) "Employ" includes to suffer or permit to work. (f) "Wage" paid to any employee shall mean the remuneration or earnings, however designated, capable of being expressed in terms of money, whether fixed or ascertained on a time, task, piece, or commission basis, or other method of calculating the same, which is payable by an employer to an employee under a written or unwritten contract of employment for work done or to be done, or for services rendered or to be rendered and includes the fair and reasonable value, as determined by the Secretary of Labor and Employment, of board, lodging, or other facilities customarily furnished by the employer to the employee. "Fair and reasonable value" shall not include any profit to the employer, or to any person affiliated with the employer. ART. 98. APPLICATION OF TITLE. This Title shall not apply to farm tenancy or leasehold, domestic service and persons working in their respective homes in needle work or in any cottage industry duly registered in accordance with law. Wages All kinds of remuneration Commissions are considered wage (so in determining EER, look at control) Wages vs. Salaries Wages – indicates considerable pay for a lower and less responsible character of employment Salaries – denotes a higher degree of employment, or a superior grade of services and implies a position or office Why is it important to distinguish between salary and wage? Wage cannot be attached, while salaries can be attached. Facilities vs. Supplements Supplements constitute extra remuneration or special privileges or benefits given to or received by
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JUSTICE VICENTE S.E. VELOSO the laborers over and above their ordinary earnings or wages. (NOT WAGE DEDUCTIBLE) Facilities, on the other hand, are items of expense necessary for the laborer’s and his family’s existence and subsistence, so that by express provision of law, they form part of the wage and when furnished by the employer are deductible therefrom, since if not so furnished, the laborer would spend and pay for them just the same. (WAGE DEDUCTIBLE) The benefit or privilege given to the employee which constitutes extra remuneration over and above his basic or ordinary earning or wage, is supplement; and when said benefit or privilege is part of the laborer’s basic wages, it is a facility. Tests: For the benefit of employee – facility For the benefit of employer – supplement Q: Can the employer immediately deduct the value of facilities from employee’s wages? NO. An employer must observe certain legal requirements before deducting the value of facilities from the employee’s wages. These requirements are: a. Proof must be shown that such facilities are customarily furnished by the trade; b. The provision of deductible facilities must be voluntarily accepted in writing by the employee; and c. Facilities must be charged at a fair and reasonable value. This Title shall NOT apply to: Farm tenancy or leasehold Domestic service (including drivers) Persons working in their respective homes in needle work or in any cottage industry duly registered Workers in a duly registered cooperative Abante v. Lamadrid Bearing & Parts Co., G.R. No. 159890, May 28, 2004 Under the control test, an employer-employee relationship exists where the person for whom the services are performed reserves the right to control not only the end achieved, but also the manner and means to be used in reaching that end.
LABOR LAW 1 (POST-MIDTERMS) There could be no employer-employee relationship where the element of control is absent. Where a person who works for another does so more or less at his own pleasure and is not subject to definite hours or conditions of work, and in turn is compensated according to the result of his efforts and not the amount thereof, no relationship of employer-employee exists. While the term “commission” under Article 97 of the Labor Code was construed as being included in the definition of the term “wage” available to employees, there is no categorical pronouncement that the payment of compensation on commission basis is conclusive proof of the existence of an employer-employee relationship. After all, commission, as a form of remuneration, may be availed of by both an employee or a nonemployee. R Transport v. Ejandra, G.R. No. 148508, May 20, 2004 The fact that petitioner paid private respondent on commission basis did not rule out the presence of an employee-employer relationship. Article 97(f) of the Labor Code clearly provides that an employee’s wages can be in the form of commissions.
JUSTICE VICENTE S.E. VELOSO
Workers whose calculated pay is based not on the amount of time spent, but on the quantity and quality of the kind of work they do are paid by results. They must still get minimum wage. Q: In including non-basic benefits in the computation of 13th month pay for 3 years, can the employer plead mistake and reduce its employees’ 13th month pay? NO. This may be construed as a voluntary act on the part of the employer. The latter cannot shift the blame on its payroll personnel. A company practice favorable to the employees had been established and the payments made pursuant thereto, ripened into benefits enjoyed by them. And any benefit being enjoyed by the employees cannot be reduced, diminished, discontinued or eliminated by the employer, by virtue of Art. 100 of the Labor Code. Mayon Hotel & Restaurant v. Adana, G.R. No. 157634, May 16, 2005 The cost of meals and snacks purportedly provided to respondents cannot be deducted as part of respondents’ minimum wage. Even granting that meals and snacks were provided and indeed constituted facilities, such facilities could not be deducted without compliance with certain legal requirements. The employer simply cannot deduct the value from the employee's wages without satisfying the following: (a) proof that such facilities are customarily furnished by the trade; (b) the provision of deductible facilities is voluntarily accepted in writing by the employee; and (c) the facilities are charged at fair and reasonable value. Food or snacks or other convenience provided by the employers are deemed as supplements if they are granted for the convenience of the employer. The criterion in making a distinction between a supplement and a facility does not so much lie in the kind (food, lodging) but the purpose. C. Planas Commercial v. NLRC, G.R. No. 121696, February 11, 1999 Retail/service establishments regularly employing not more than 10 workers may be exempted from the applicability of RA 6727 (Wage Rationalization Act) upon application with and as determined by the appropriate Regional Board in accordance with the
ART. 99. REGIONAL MINIMUM WAGES. The minimum wage rates for agricultural and nonagricultural employees and workers in each and every region of the country shall be those prescribed by the Regional Tripartite Wages and Productivity Boards. (As amended by Section 3, Republic Act No. 6727, June 9, 1989). ART. 100. PROHIBITION AGAINST ELIMINATION OR DIMINUTION OF BENEFITS. Nothing in this Book shall be construed to eliminate or in any way diminish supplements, or other employee benefits being enjoyed at the time of promulgation of this Code. ART. 101. PAYMENT BY RESULTS. The Secretary of Labor and Employment shall regulate the payment of wages by results, including pakyao, piecework, and other non-time work, in order to ensure the payment of fair and reasonable wage rates, preferably through time and motion studies or in consultation with representatives of workers’ and employers’ organizations.
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MINIMUM WAGE RATES
LABOR LAW 1 (POST-MIDTERMS) applicable rules and regulations issued by the Commission. Whenever an application for exemption has been duly filed with the appropriate Regional Board, action on any complaint for alleged noncompliance with RA 6727 shall be deferred pending resolution of the application for exemption by the appropriate Regional Board. In the event that applications for exemptions are not granted, employees shall receive the appropriate compensation due them as provided for by this Act plus interest of one percent (1%) per month retroactive to the effectivity of the Act.
JUSTICE VICENTE S.E. VELOSO circumstances have ceased. No employer shall make payment with less frequency than once a month. The payment of wages of employees engaged to perform a task which cannot be completed in two (2) weeks shall be subject to the following conditions, in the absence of a collective bargaining agreement or arbitration award: (1) That payments are made at intervals not exceeding sixteen (16) days, in proportion to the amount of work completed; (2) That final settlement is made upon completion of the work. ART. 104. PLACE OF PAYMENT. Payment of wages shall be made at or near the place of undertaking, except as otherwise provided by such regulations as the Secretary of Labor and Employment may prescribe under conditions to ensure greater protection of wages. Place of Payment GR: It is not the employee’s responsibility to leave his workplace in order to get his wages. Such payment must be near or at the place of the business. Exceptions: Free transportation provided by employer There is deterioration of the peace and order conditions in the workplace due to actual or impending emergencies Other analogous causes, but the time spent by the employee in collecting his wages is considered compensable time ART. 105. DIRECT PAYMENT OF WAGES. Wages shall be paid directly to the workers to whom they are due, except: (a) In cases of force majeure rendering such payment impossible or under other special circumstances to be determined by the Secretary of Labor and Employment in appropriate regulations, in which case, the worker may be paid through another person under written authority given by the worker for the purpose; or (b) Where the worker has died, in which case, the employer may pay the wages of the deceased worker to the heirs of the latter without the necessity of intestate proceedings. The claimants, if they are all of age, shall execute an affidavit attesting to their relationship to the deceased and the fact that they are his heirs, to the exclusion of all
ART. 102. FORMS OF PAYMENT. No employer shall pay the wages of an employee by means of promissory notes, vouchers, coupons, tokens, tickets, chits, or any object other than legal tender, even when expressly requested by the employee. Payment of wages by check or money order shall be allowed when such manner of payment is customary on the date of effectivity of this Code, or is necessary because of special circumstances as specified in appropriate regulations to be issued by the Secretary of Labor and Employment or as stipulated in a collective bargaining agreement. Cash wage compared to Art. 97(f) which states that facilities are part of wages. (Facilities are not legal tender.) The law means that the cash component of the wage be paid in legal tender and not anything else. Legal tender combined with some other form of payment (like groceries) is violative of the LC. The only instance where an employer can pay wages in forms other than legal tender is by checks or money order only when the circumstances in the 2nd par. of Art. 102 are present. (Congson v. NLRC) ART. 103. TIME OF PAYMENT. Wages shall be paid at least once every two (2) weeks or twice a month at intervals not exceeding sixteen (16) days. If on account of force majeure or circumstances beyond the employer’s control, payment of wages on or within the time herein provided cannot be made, the employer shall pay the wages immediately after such force majeure or
PAYMENT OF WAGES
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LABOR LAW 1 (POST-MIDTERMS) other persons. If any of the heirs is a minor, the affidavit shall be executed on his behalf by his natural guardian or next-of-kin. The affidavit shall be presented to the employer who shall make payment through the Secretary of Labor and Employment or his representative. The representative of the Secretary of Labor and Employment shall act as referee in dividing the amount paid among the heirs. The payment of wages under this Article shall absolve the employer of any further liability with respect to the amount paid. ART. 106. CONTRACTOR OR SUBCONTRACTOR. Whenever an employer enters into a contract with another person for the performance of the former’s work, the employees of the contractor and of the latter’s subcontractor, if any, shall be paid in accordance with the provisions of this Code. In the event that the contractor or subcontractor fails to pay the wages of his employees in accordance with this Code, the employer shall be jointly and severally liable with his contractor or subcontractor to such employees to the extent of the work performed under the contract, in the same manner and extent that he is liable to employees directly employed by him. The Secretary of Labor and Employment may, by appropriate regulations, restrict or prohibit the contracting-out of labor to protect the rights of workers established under this Code. In so prohibiting or restricting, he may make appropriate distinctions between labor-only contracting and job contracting as well as differentiations within these types of contracting and determine who among the parties involved shall be considered the employer for purposes of this Code, to prevent any violation or circumvention of any provision of this Code. There is "labor-only" contracting where the person supplying workers to an employer does not have substantial capital or investment in the form of tools, equipment, machineries, work premises, among others, and the workers recruited and placed by such person are performing activities which are directly related to the principal business of such employer. In such cases, the person or intermediary shall be considered merely as an agent of the employer who shall be responsible to the workers in the same manner and extent as if the latter were directly employed by him.
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JUSTICE VICENTE S.E. VELOSO
Please see notes on Job Contracting and Labor-only Contracting in the midterms reviewer. Art. 109 applies to wages only; it is not applicable to claims other than wages like damages resulting from illegal dismissal. The performance bond required in Art. 108 is really for the contractor’s own protection due to his potential solidary liability. Meralco v. Benamira, G.R. No. 145271, July 14, 2005 The individual respondents can not be considered as regular employees of the MERALCO for, although security services are necessary and desirable to the business of MERALCO, it is not directly related to its principal business and may even be considered unnecessary in the conduct of MERALCO’s principal business, which is the distribution of electricity. Manila Water District v. Pena, G.R. No. 158255, July 8, 2004 “Labor-only contracting” as defined in Section 5, Department Order No. 18-02, Rules Implementing Articles 106-109 of the Labor Code refers to an arrangement where the contractor
LABOR LAW 1 (POST-MIDTERMS) or subcontractor merely recruits, supplies or places workers to perform job, work or service for a principal. The fact that AGCI was not an independent contractor is buttressed by the fact that ACGI does not have substantial capitalization or investment in the form of tools, equipment, machineries, work premises, and other materials, to qualify as an independent contractor. While it has an authorized capital stock of P1,000,000.00, only P62,500.00 is actually paid-in, which cannot be considered substantial capitalization. Under this factual milieu, there is no doubt that ACGI was engaged in labor-only contracting, and as such, is considered merely an agent of the petitioner. In labor-only contracting, the statute creates an employer-employee relationship for a comprehensive purpose: to prevent a circumvention of labor laws. The contractor is considered merely an agent of the principal employer and the latter is responsible to the employees of the labor-only contractor as if such employees had been directly employed by the principal employer. ART. 110. WORKER PREFERENCE IN CASE OF
JUSTICE VICENTE S.E. VELOSO under Article 110 of the Labor Code is an ordinary preferred credit. While this provision raises the worker’s money claim to first priority in the order of preference established under Article 2244 of the Civil Code, the claim has no preference over special preferred credits. The right of employees to be paid benefits due them from the properties of their employer cannot have any preference over the latter’s mortgage credit. ART. 111. ATTORNEY’S FEES. (a) In cases of unlawful withholding of wages, the culpable party may be assessed attorney’s fees equivalent to ten percent of the amount of wages recovered. (b) It shall be unlawful for any person to demand or accept, in any judicial or administrative proceedings for the recovery of wages, attorney’s fees which exceed ten percent of the amount of wages recovered. Par. (a) – culpable party may be assessed instead of the client Par. (b) – 10% is the maximum; where no attorney’s fees are awarded, employee will pay (I think that’s why there’s a cap.) Philippine Military Veterans Security and Investigation Agency v. CA, G.R. No. 139159, January 31, 2006; Premiere Development Bank v. Mantal, G.R. No. 167716, March 23, 2006 It is settled that in actions for recovery of wages or where an employee was forced to litigate and incur expenses to protect his rights and interest, he is entitled to an award of attorney’s fees. San Miguel Corporation, v. Aballa, G.R. No. 149011, June 28, 2005 With respect to attorney’s fees, in actions for recovery of wages or where an employee was forced to litigate and thus incurred expenses to protect his rights and interests, a maximum of ten percent (10%) of the total monetary award by way of attorney’s fees is justifiable under Article 111 of the Labor Code, Section 8, Rule VIII, Book III of its Implementing Rules, and paragraph 7, Article 2208 of the Civil Code. Although an express finding of facts and law is still necessary to prove the merit of the award, there need not be any showing that the employer acted maliciously or in bad faith
In the event of bankruptcy or liquidation of an employer’s 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). The intent of the law is to place workers’ claims above all other claims, including gov’t claims. There should be a bankruptcy proceeding for Art. 110 to apply. (as opposed to a rehabilitation where the receiver takes hold of the assets of the company for it to gain profit and answer for company’s liabilities) Barayoga v. Asset Privatization Trust, G.R. No. 160073, October 24, 2005 This Court has ruled in a long line of cases that under Articles 2241 and 2242 of the Civil Code, a mortgage credit is a special preferred credit that enjoys preference with respect to a specific/determinate property of the debtor. On the other hand, the worker’s preference
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LABOR LAW 1 (POST-MIDTERMS) when it withheld the wages. There need only be a showing that the lawful wages were not paid accordingly, as in this case. Micro Sales Operation Network v. NLRC, G.R. No. 155279, October 11, 2005 The award of attorneys’ fees, though not prayed for, is sanctioned by law and must be upheld.
JUSTICE VICENTE S.E. VELOSO and his responsibility has been clearly shown.
ART. 116. WITHHOLDING OF WAGES AND KICKBACKS It shall be unlawful for any person, directly or indirectly, to withhold any 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 worker’s consent. ART. 117. DEDUCTION TO ENSURE EMPLOYMENT. 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.
PROHIBITIONS REGARDING WAGES
ART. 112. NON-INTERFERENCE IN DISPOSAL OF 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 property from any other person, or otherwise make use of any store or services of such employer or any other person. ART. 113. WAGE DEDUCTION. 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 and Employment.
ART. 118. RETALIATORY MEASURES. 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 or instituted any proceeding under this Title or has testified or is about to testify in such proceedings. ART. 119. FALSE REPORTING. It shall be unlawful for any person to make any statement, report, or record filed or kept pursuant to the provisions of this Code knowing such statement, report or record to be false in any material respect. Q: When is wage deduction by the employer on the wages of the employee allowed? As a general rule, no employer shall make any deduction from the wages of his employees, except: 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; 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 In cases where the employer is authorized by law or regulations issued by the Secretary of Labor.
ART. 114. DEPOSITS FOR LOSS OR DAMAGE. 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 equipment 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 and Employment in appropriate rules and regulations. ART. 115. LIMITATIONS. No deduction from the deposits of an employee for the actual amount of the loss or damage shall be made unless the employee has been heard thereon,
WAGE STUDIES, WAGE AGREEMENTS AND WAGE DETERMINATION
ART. 120. CREATION OF NATIONAL WAGES AND PRODUCTIVITY COMMISSION.
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LABOR LAW 1 (POST-MIDTERMS) There is hereby created a National Wages and Productivity Commission, hereinafter referred to as the Commission, which shall be attached to the Department of Labor and Employment (DOLE) for policy and program coordination. (As amended by Republic Act No. 6727, June 9, 1989). ART. 121. POWERS AND FUNCTIONS OF THE COMMISSION. The Commission shall have the following powers and functions: (a) To act as the national consultative and advisory body to the President of the Philippines and Congress on matters relating to wages, incomes and productivity; (b) To formulate policies and guidelines on wages, incomes and productivity improvement at the enterprise, industry and national levels; (c) To prescribe rules and guidelines for the determination of appropriate minimum wage and productivity measures at the regional, provincial, or industry levels; (d) To review regional wage levels set by the Regional Tripartite Wages and Productivity Boards to determine if these are in accordance with prescribed guidelines and national development plans; (e) To undertake studies, researches and surveys necessary for the attainment of its functions and objectives, and to collect and compile data and periodically disseminate information on wages and productivity and other related information, including, but not limited to, employment, cost-ofliving, labor costs, investments and returns; (f) To review plans and programs of the Regional Tripartite Wages and Productivity Boards to determine whether these are consistent with national development plans; (g) To exercise technical and administrative supervision over the Regional Tripartite Wages and Productivity Boards; (h) To call, from time to time, a national tripartite conference of representatives of government, workers and employers for the consideration of measures to promote wage rationalization and productivity; and (i) To exercise such powers and functions as may be necessary to implement this Act. The Commission shall be composed of the Secretary of Labor and Employment as ex-officio chairman, the Director-General of the National Economic and Development Authority (NEDA) as ex-officio viceRyan Quan 3C ’06-’07
JUSTICE VICENTE S.E. VELOSO chairman, and two (2) members each from workers’ and employers’ sectors who shall be appointed by the President of the Philippines upon recommendation of the Secretary of Labor and Employment to be made on the basis of the list of nominees submitted by the workers’ and employers’ sectors, respectively, and who shall serve for a term of five (5) years. The Executive Director of the Commission shall also be a member of the Commission. The Commission shall be assisted by a Secretariat to be headed by an Executive Director and two (2) Deputy Directors, who shall be appointed by the President of the Philippines, upon the recommendation of the Secretary of Labor and Employment. The Executive Director shall have the same rank, salary, benefits and other emoluments as that of a Department Assistant Secretary, while the Deputy Directors shall have the same rank, salary, benefits and other emoluments as that of a Bureau Director. The members of the Commission representing labor and management shall have the same rank, emoluments, allowances and other benefits as those prescribed by law for labor and management representatives in the Employees’ Compensation Commission. (As amended by Republic Act No. 6727, June 9, 1989). ART. 122. CREATION OF REGIONAL TRIPARTITE WAGES AND PRODUCTIVITY BOARDS. There is hereby created Regional Tripartite Wages and Productivity Boards, hereinafter referred to as Regional Boards, in all regions, including autonomous regions as may be established by law. The Commission shall determine the offices/headquarters of the respective Regional Boards. The Regional Boards shall have the following powers and functions in their respective territorial jurisdictions: (a) To develop plans, programs and projects relative to wages, incomes and productivity improvement for their respective regions; (b) To determine and fix minimum wage rates applicable in their regions, provinces or industries therein and to issue the corresponding wage orders, subject to guidelines issued by the Commission; (c) To undertake studies, researches, and surveys necessary for the attainment of their functions,
LABOR LAW 1 (POST-MIDTERMS) objectives and programs, and to collect and compile data on wages, incomes, productivity and other related information and periodically disseminate the same; (d) To coordinate with the other Regional Boards as may be necessary to attain the policy and intention of this Code; (e) To receive, process and act on applications for exemption from prescribed wage rates as may be provided by law or any Wage Order; and (f) To exercise such other powers and functions as may be necessary to carry out their mandate under this Code. Implementation of the plans, programs, and projects of the Regional Boards referred to in the second paragraph, letter (a) of this Article, shall be through the respective regional offices of the Department of Labor and Employment within their territorial jurisdiction; Provided, however, That the Regional Boards shall have technical supervision over the regional office of the Department of Labor and Employment with respect to the implementation of said plans, programs and projects. Each Regional Board shall be composed of the Regional Director of the Department of Labor and Employment as chairman, the Regional Directors of the National Economic and Development Authority and the Department of Trade and Industry as vicechairmen and two (2) members each from workers’ and employers’ sectors who shall be appointed by the President of the Philippines, upon the recommendation of the Secretary of Labor and Employment, to be made on the basis of the list of nominees submitted by the workers’ and employers’ sectors, respectively, and who shall serve for a term of five (5) years. Each Regional Board to be headed by its chairman shall be assisted by a Secretariat. (As amended by Republic Act No. 6727, June 9, 1989). Composition of the Commission DOLE Secretary – Chair (ex officio) Director-General of NEDA – Vice Chair (ex officio) 2 members from employers sector 2 members from workers sector assisted by a Secretariat, headed by an Executive Director and 2 Deputy Directors
JUSTICE VICENTE S.E. VELOSO Composition of the Wage Boards DOLE Regional Director – Chair Regional Director of NEDA and DTI – Vice Chairs 2 members from employers sector 2 members from workers sector ART. 123. WAGE ORDER. Whenever conditions in the region so warrant, the Regional Board shall investigate and study all pertinent facts; and based on the standards and criteria herein prescribed, shall proceed to determine whether a Wage Order should be issued. Any such Wage Order shall take effect after fifteen (15) days from its complete publication in at least one (1) newspaper of general circulation in the region. In the performance of its wage-determining functions, the Regional Board shall conduct public hearings/consultations, giving notices to employees’ and employers’ groups, provincial, city and municipal officials and other interested parties. Any party aggrieved by the Wage Order issued by the Regional Board may appeal such order to the Commission within ten (10) calendar days from the publication of such order. It shall be mandatory for the Commission to decide such appeal within sixty (60) calendar days from the filing thereof. The filing of the appeal does not stay the order unless the person appealing such order shall file with the Commission, an undertaking with a surety or sureties satisfactory to the Commission for the payment to the employees affected by the order of the corresponding increase, in the event such order is affirmed. (As amended by Republic Act No. 6727, June 9, 1989). Appeal of Wage Order Appeal to the National Wages & Productivity Commission (NWPC) Within 10 days from the publication of the order Appeal DOES NOT stay the order, UNLESS the person appealing files an undertaking with surety for payment to employees affected by the order of the corresponding increase, if it is affirmed Wage Creditability
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LABOR LAW 1 (POST-MIDTERMS) Wage increase agreed upon in a CBA can be considered as compliance in the increase mandated by a Wage Order GR: Allowed E: if it calls for an anniversary wage increase E to E: if anniversary wage increase is allowed in the CBA Example: Wage Order 302 – Php 25 increase CBA provides for the following increases: 1st year – Php 50 2nd year – Php 50 3rd year – Php 30 Wage Order 303 – Php 25 increase Here, the Php 50 increase in the CBA for the 1st year is deemed as compliance with the subsequent wage order. However, this is not creditable because there is an anniversary increase. But if the CBA allows the anniversary increase, then it is creditable. Q: Consider an independent contractor. If a Wage Order mandates an increase by the principal, who should the worker sue in case of non-compliance? The worker must sue the contractor, and implead the principal as co-respondent. Remedies for non-compliance with Wage Order Art. 128 – routine inspection Art. 129 – file monetary claim with DOLE Regional Director (claim not exceeding P5T) Art. 217(a)(3) or (6) – Labor Arbiter Double Indemnity Non-compliance with a wage order is punishable by a fine or imprisonment AND the employer must pay the amount double the unpaid benefits. Q: In sum, when is the employer required to pay higher than minimum wage? Wage Order (123) CBA (125 / 155) Voluntary Arbitration Award (261 / 262) Compuldary Arbitration Award [263(g)] Company Practice or Policy Productivity Incentives Program (RA 6971) NOTE: To be a company practice, an act must be deliberate, consistent, voluntary, and the employer must have given it aware that the employees were not entitled to the benefit under existing laws.
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ART. 124. STANDARDS/CRITERIA FOR MINIMUM WAGE FIXING. The regional minimum wages to be established by the Regional Board shall be as nearly adequate as is economically feasible to maintain the minimum standards of living necessary for the health, efficiency and general well-being of the employees within the framework of the national economic and social development program. In the determination of such regional minimum wages, the Regional Board shall, among other relevant factors, consider the following: (a) The demand for living wages; (b) Wage adjustment vis-à-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 (j) The equitable distribution of income and wealth along the imperatives of economic and social development. The wages prescribed in accordance with the provisions of this Title shall be the standard prevailing minimum wages in every region. These wages shall include wages varying with industries, provinces or localities if in the judgment of the Regional Board, conditions make such local differentiation proper and necessary to effectuate the purpose of this Title. Any person, company, corporation, partnership or any other entity engaged in business shall file and register annually with the appropriate Regional Board, Commission and the National Statistics Office, an itemized listing of their labor component, specifying the names of their workers and employees below the managerial level, including learners, apprentices and disabled/handicapped workers who were hired under the terms prescribed in the employment contracts, and their corresponding salaries and wages.
LABOR LAW 1 (POST-MIDTERMS) Where the application of any prescribed wage increase by virtue of a law or wage order issued by any Regional Board results in distortions of the wage structure within an establishment, the employer and the union shall negotiate to correct the distortions. Any dispute arising from wage distortions shall be resolved through the grievance procedure under their collective bargaining agreement and, if it remains unresolved, through voluntary arbitration. Unless otherwise agreed by the parties in writing, such dispute shall be decided by the voluntary arbitrators within ten (10) calendar days from the time said dispute was referred to voluntary arbitration. In cases where there are no collective agreements or recognized labor unions, the employers and workers shall endeavor to correct such distortions. Any dispute arising therefrom shall be settled through the National Conciliation and Mediation Board and, if it remains unresolved after ten (10) calendar days of conciliation, shall be referred to the appropriate branch of the National Labor Relations Commission (NLRC). It shall be mandatory for the NLRC to conduct continuous hearings and decide the dispute within twenty (20) calendar days from the time said dispute is submitted for compulsory arbitration. The pendency of a dispute arising from a wage distortion shall not in any way delay the applicability of any increase in prescribed wage rates pursuant to the provisions of law or wage order. As used herein, a wage distortion shall mean 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 embodied in such wage structure based on skills, length of service, or other logical bases of differentiation. All workers paid by result, including those who are paid on piecework, takay, pakyaw or task basis, shall receive not less than the prescribed wage rates per eight (8) hours of work a day, or a proportion thereof for working less than eight (8) hours. All recognized learnership and apprenticeship agreements shall be considered automatically modified insofar as their wage clauses are
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JUSTICE VICENTE S.E. VELOSO concerned to reflect the prescribed wage rates. (As amended by Republic Act No. 6727, June 9, 1989). Wage Distortions An increase in the prescribed wage rates, which 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 embodied in such wage structure based on skills, length of service, or other logical bases of differentiations. Procedure for correcting: 1. Organized establishment - grievance procedure - voluntary arbitration (decide w/in 10 days from referral) 2. Unorganized establishment - Employer and workers will try to correct the distortion - NCMB (10 calendar days – conciliation if unresolved) - NLRC (decide w/in 20 days from submission) Bankard Employees Union v. NLRC, G.R. No. 140689, February 17, 2004 Article 124 should be construed and correlated in relation to minimum wage fixing, the intention of the law being that in the event of an increase in minimum wage, the distinctions embodied in the wage structure based on skills, length of service, or other logical bases of differentiation will be preserved. If the compulsory mandate under Article 124 to correct “wage distortion” is applied to voluntary and unilateral increases by the employer in fixing hiring rates which is inherently a business judgment prerogative, then the hands of the employer would be completely tied even in cases where an increase in wages of a particular group is justified due to a re-evaluation of the high productivity of a particular group, or as in the present case, the need to increase the competitiveness of Bankard’s hiring rate. An employer would be discouraged from adjusting the salary rates of a particular group of employees for fear that it would result to a demand by all employees for a similar increase, especially if the financial conditions of the business cannot address an across-the-board increase.
LABOR LAW 1 (POST-MIDTERMS) Wage distortion is a factual and economic condition that may be brought about by different causes. The mere factual existence of wage distortion does not, however, ipso facto result to an obligation to rectify it, absent a law or other source of obligation which requires its rectification. Unlike in Metro Transit then where there existed a “company practice,” no such management practice is herein alleged to obligate Bankard to provide an across-theboard increase to all its regular employees. Mindanao Steel Corporation, v. Minsteel Free Workers Organization, G.R. No. 130693, March 4, 2004 In this case, Section 3, Article VII of the CBA of the Minsteel Free Workers Organization provides: “It is hereby agreed that these salary increases shall be exclusive of any wage increase that may be provided by law as a result of any economic change.” The above provision is clear that the salary increases, such as the P20.00 provided under the CBA, shall not include any wage increase that may be provided by law as a result of any economic change. Hence, aside from the P20.00 CBA wage increase, respondent’s members are also entitled to the ECOLA under the Interim Wage Order. Thus, the P20.00 daily wage increase can not be considered as a creditable benefit or compliance with the Interim wage Order. ART. 125. FREEDOM TO BARGAIN. No wage order shall be construed to prevent workers in particular firms or enterprises or industries from bargaining for higher wages with their respective employers. (As amended by Republic Act No. 6727, June 9, 1989). Rationale: Law only sets the minimum Wage Order vs. CBA A wage order is an administrative issuance which proceeds from a statute (RA 6727). A CBA is not an ordinary contract. It can be entered into only by an exclusive bargaining unit / agent. The wage order sets the minimum; better benefits under the CBA entitles the employees to the latter. ART. 126. PROHIBITION AGAINST INJUNCTION. No preliminary or permanent injunction or
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JUSTICE VICENTE S.E. VELOSO temporary restraining order may be issued by any court, tribunal or other entity against any proceedings before the Commission or the Regional Boards. (As amended by Republic Act No. 6727, June 9, 1989). ART. 127. NON-DIMINUTION OF BENEFITS. No wage order issued by any regional board shall provide for wage rates lower than the statutory minimum wage rates prescribed by Congress. (As amended by Republic Act No. 6727, June 9, 1989). Can a Wage Board decrease a prevailing minimum wage in a region? YES. The “statutory minimum wage rate” referred to in Art. 127 is that which was set during the time when Congress was still the one which determines minimum wage (i.e. before RA 6727).
ADMINISTRATION AND ENFORCEMENT
ART. 128. VISITORIAL AND ENFORCEMENT POWER. (a) The Secretary of Labor and Employment or his duly authorized representatives, including labor regulation officers, shall have access to employer’s records and premises at any time of the day or night whenever work is being undertaken therein, and the right to copy therefrom, to 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 this Code and of any labor law, wage order or rules and regulations issued pursuant thereto. (b) Notwithstanding the provisions of Articles 129 and 217 of this Code to the contrary, and in cases where the relationship of employer-employee still exists, the Secretary of Labor and Employment or his duly authorized representatives shall have the power to issue compliance orders to give effect to the labor standards provisions of this Code and other labor legislation based on the findings of labor employment and enforcement officers or industrial safety engineers made in the course of inspection. The Secretary or his duly authorized representatives shall issue writs of execution to the appropriate authority for the enforcement of their orders, except in cases where the employer contests the findings of the labor employment and enforcement officer and raises issues supported by documentary proofs which were not considered in the course of inspection. (As amended by Republic Act No. 7730, June 2, 1994).
LABOR LAW 1 (POST-MIDTERMS)
JUSTICE VICENTE S.E. VELOSO 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).
An order issued by the duly authorized representative of the Secretary of Labor and Employment under this Article may be appealed to the latter. In case said order involves a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly accredited by the Secretary of Labor and Employment in the amount equivalent to the monetary award in the order appealed from. (As amended by Republic Act No. 7730, June 2, 1994). (c) The Secretary of Labor and Employment may likewise order stoppage of work or suspension of operations of any unit or department of an establishment when non-compliance with the law or implementing rules and regulations poses grave and imminent danger to the health and safety of workers in the workplace. Within twenty-four hours, a hearing shall be conducted to determine whether an order for the stoppage of work or suspension of operations shall be lifted or not. In case the violation is attributable to the fault of the employer, he shall pay the employees concerned their salaries or wages during the period of such stoppage of work or suspension of operation. (d) It shall be unlawful for any person or entity to obstruct, impede, delay or otherwise render ineffective the orders of the Secretary of Labor and Employment or his duly authorized representatives issued pursuant to the authority granted under this Article, and no inferior court or entity shall issue temporary or permanent injunction or restraining order or otherwise assume jurisdiction over any case involving the enforcement orders issued in accordance with this Article. (e) Any government employee found guilty of violation of, or abuse of authority, under this Article shall, after appropriate administrative investigation, be subject to summary dismissal from the service. (f) The Secretary of Labor and Employment may, by appropriate regulations, require employers to keep and maintain such employment records as may be necessary in aid of his visitorial and enforcement powers under this Code. ART. 129. RECOVERY OF WAGES, SIMPLE MONEY CLAIMS AND OTHER BENEFITS.
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Visitorial and Enforcement Power
LABOR LAW 1 (POST-MIDTERMS) 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 determine violations, or which may be necessary to aid in enforcement of this code or any labor law or order. 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 VISITORIAL & ENFORCEMENT POWER UNDER ARTICLE 128 • Offshoot of inspection • Labor legislation in general RECOVERY OF WAGES UNDER ARTICLE 129 Jurisdictional Authority
JUSTICE VICENTE S.E. VELOSO Claimant: Employee or person in domestic or household service, Provided: 1. No claim for reinstatement 2. Aggregate claims of each employee or househelper does not exceed P5,000 if the claim later exceeds P5,000, Regional Director still retains jurisdiction based on inspection's findings in the nature of enforcement action – [Guico v. Secretary of Labor 298 SCRA 666 (1998)] 3. Claims arise from EER Notice and Hearing Resolution of Complaint within 30 days from filing (Appeal within 5 calendar days to NLRC) NLRC to resolve appeal within 10 calendar days from submission of last pleading Not Included: Claims for Employee's Compensation, Social Security benefits, Medicare Benefits and Maternity Benefits Regional Director cannot enforce results of Visitorial Power when: 1. Employer contests the findings 2. Issues raised requires examination of evidentiary matters 3. Such matters are not verifiable in the normal course of inspection Art. 128 Orig: DOLE Secretary Delegated Authority: DOLE Regional Director None Art. 129 Original, Exclusive: DOLE Regional Director Art. 217(a) Original, Exclusive: Labor Arbiter
• Inspection of establishments & the issuance of order to compel compliance with labor standards, wage orders & other labor law regulations
• Initiated by sworn complaints • Limits proceedings to monetary claims which involve any labor • Adjudication through summary proceedings after notice and hearing of employee’s claims for wages & benefits
Should not exceed Php 5,000
RECOVERY of Wages, Simple Money Claims & Other Benefits Jurisdiction: DOLE Regional Director (Summary Proceeding)
Routine Inspection – normally done
Complaint Inspection – done upon complaint
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(3) – 5T and below with claim for reinst. (6) – beyond 5T, regardless of claim for reinst. Adjudicatio n
LABOR LAW 1 (POST-MIDTERMS) No dismissal yet. (EER exists) DOLE Secretary (found in Rules) Jurisdiction ally required Within 10 calendar days (Rules) EER no longer exists but no claim for reinst. NLRC – Art. 159 EER exists and there is a claim for reinst. NLRC – Art. 223
JUSTICE VICENTE S.E. VELOSO have been recognized as acceptable are (a) counsel’s reliance on the footnote of the notice of the decision of the Labor Arbiter that “the aggrieved party may appeal …within ten (10) working days;” (b) fundamental consideration of substantial justice; (c) prevention of miscarriage of justice or of unjust enrichment, as where the tardy appeal is from a decision granting separation pay which was already granted in an earlier final decision; and (d) special circumstances of the case combined with its legal merits or the amount and the issue involved. A one-day delay in the perfection of the appeal was excused in Pacific Asia Overseas Shipping Corp. v. NLRC, Insular Life Assurance Co. v. NLRC, and City Fair Corp. v. NLRC.
Necessary to perfect an appeal (Art. 223) 10 days (Art. 223)
Period to Appeal
Cirineo Bowling Plaza v. Sensing, G.R. No. 146572, January 14, 2005 While it is true that under Articles 129 and 217 of the Labor Code, the Labor Arbiter has jurisdiction to hear and decide cases where the aggregate money claims of each employee exceeds P5,000.00, said provisions of law do not contemplate nor cover the visitorial and enforcement powers of the Secretary of Labor or his duly authorized representatives. Rather, said powers are defined and set forth in Article 128 of the Labor Code (as amended by R.A. No. 7730). The said provision explicitly excludes from its coverage Articles 129 and 217 of the Labor Code by the phrase “(N)otwithstanding the provisions of Articles 129 and 217 of this Code to the contrary . . .” thereby retaining and further strengthening the power of the Secretary of Labor or his duly authorized representative to issue compliance orders to give effect to the labor standards provisions of said Code and other labor legislation based on the findings of labor employment and enforcement officers or industrial safety engineers made in the course of inspection. Southech Development Corp. v. NLRC, G.R. No. 149590, January 12, 2005 This Court has given imprimatur to the NLRC’s disregard of procedural lapse in filing a belated appeal where there is an “acceptable reason” to excuse the tardiness. Among the reasons which
TITLE III: WORKING CONDITIONS FOR SPECIAL GROUPS OF EMPLOYEES EMPLOYMENT OF WOMEN
ART. 130. NIGHTWORK PROHIBITION. No woman, regardless of age, shall be employed or permitted or suffered to work, with or without compensation: (a) In any industrial undertaking or branch thereof between ten o’clock at night and six o’clock in the morning of the following day; or (b) In any commercial or non-industrial undertaking or branch thereof, other than agricultural, between midnight and six o’clock in the morning of the following day; or (c) In any agricultural undertaking at nighttime unless she is given a period of rest of not less than nine (9) consecutive hours. ART. 131. EXCEPTIONS. The prohibitions prescribed by the preceding Article shall not apply in any of the following cases: (a) In cases of actual or impending emergencies caused by serious accident, fire, flood, typhoon, earthquake, epidemic or other disasters or calamity, to prevent loss of life or property, or in cases of force majeure or imminent danger to public safety; (b) In case of urgent work to be performed on machineries, equipment or installation, to avoid serious loss which the employer would otherwise suffer; (c) Where the work is necessary to prevent serious loss of perishable goods; (d) Where the woman employee holds a responsible
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LABOR LAW 1 (POST-MIDTERMS) position of managerial or technical nature, or where the woman employee has been engaged to provide health and welfare services; (e) Where the nature of the work requires the manual skill and dexterity of women workers and the same cannot be performed with equal efficiency by male workers; (f) Where the women employees are immediate members of the family operating the establishment or undertaking; and (g) Under other analogous cases exempted by the Secretary of Labor and Employment in appropriate regulations. Nightwork Prohibition a. Industrial Undertaking b. Commercial or Nonindustrial, or branch thereof, other than agricultural c. Agricultural Undertaking
JUSTICE VICENTE S.E. VELOSO NOTES: In nightwork prohibition, consider the nature of the employee’s work; not the nature of the business undertaking. Ex: working in a fertilizer company (industrial) doing clerical work (commercial) in this case, the employee can work until 12mn Tiya Dely has a radio show in the graveyard shift – can be considered technical because of the switches and gadgets that she must know ART. 132. FACILITIES FOR WOMEN. The Secretary of Labor and Employment shall establish standards that will ensure the safety and health of women employees. In appropriate cases, he shall, by regulations, require any employer to: (a) Provide seats proper for women and permit them to use such seats when they are free from work and during working hours, provided they can perform their duties in this position without detriment to efficiency; (b) To establish separate toilet rooms and lavatories for men and women and provide at least a dressing room for women; (c) To establish a nursery in a workplace for the benefit of the women employees therein; and (d) To determine appropriate minimum age and other standards for retirement or termination in special occupations such as those of flight attendants and the like. Facilities for Women a. Provide seats proper for women b. Establish separate toilet rooms and lavatories and provide at least a dressing room for women c. Establish a nursery in a workplace for the benefit of the women employees d. Determine appropriate minimum age and other standards for retirement and termination in special cases Why are there seats for women? To prevent varicose veins (accdg. to Veloso) ART. 133. MATERNITY LEAVE BENEFITS. (a) Every employer shall grant to any pregnant woman employee who has rendered an aggregate service of at least six (6) months for the last twelve (12) months, maternity leave of at least two (2) weeks prior to the expected date of delivery and another four (4) weeks after normal delivery or abortion with full pay based on her regular or
Nighttime, unless given a period of rest not less than 9 consecutive hours
Exceptions: 1. Actual or impending emergencies to prevent loss of life/property or force majeure or imminent danger to public safety 2. Urgent work to be performed to avoid serious loss to employer 3. Necessary to prevent serious loss of perishable goods 4. Holds a responsible position of managerial or technical nature or engaged to provide health or welfare service 5. Nature of work requires the manual skill and dexterity of women workers and the same cannot be performed with equal efficiency by male workers 6. Immediate members of the family operating the establishment or undertaking 7. Other analogous cases (FUNPEHM – Family members, urgent work; necessary work; peculiarity of work; emergencies; health and welfare employees; managerial employees)
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LABOR LAW 1 (POST-MIDTERMS) average weekly wages. The employer may require from any woman employee applying for maternity leave the production of a medical certificate stating that delivery will probably take place within two weeks. (b) The maternity leave shall be extended without pay on account of illness medically certified to arise out of the pregnancy, delivery, abortion or miscarriage, which renders the woman unfit for work, unless she has earned unused leave credits from which such extended leave may be charged. (c) The maternity leave provided in this Article shall be paid by the employer only for the first four (4) deliveries by a woman employee after the effectivity of this Code. Maternity Leave Benefits Has paid at least 3 monthly contributions in the 12-mo. period immediately preceding the semester of her childbirth or miscarriage Paid only for the first 4 deliveries or miscarriages 100% of average salary credit for 60 days if normal or 78 days if caesarean Woman employee may be married or unmarried Paternity Leave (RA 8187) – male employee entitled to paternity leave of 7 calendar days with full pay for the first 4 deliveries of the legitimate spouse with whom he is cohabiting ART. 134. FAMILY PLANNING SERVICES; INCENTIVES FOR FAMILY PLANNING. (a) Establishments which are required by law to maintain a clinic or infirmary shall provide free family planning services to their employees which shall include, but not be limited to, the application or use of contraceptive pills and intrauterine devices. (b) In coordination with other agencies of the government engaged in the promotion of family planning, the Department of Labor and Employment shall develop and prescribe incentive bonus schemes to encourage family planning among female workers in any establishment or enterprise. Family Planning Services, Incentives For Family Planning Maintain clinic or infirmary which shall provide for family planning service
JUSTICE VICENTE S.E. VELOSO Develop and prescribe incentive bonus schemes to encourage family planning among female workers in any establishment/enterprise ART. 135. DISCRIMINATION PROHIBITED. It shall be unlawful for any employer to discriminate against any woman employee with respect to terms and conditions of employment solely on account of her sex. The following are acts of discrimination: (a) Payment of a lesser compensation, including wage, salary or other form of remuneration and fringe benefits, to a female employees as against a male employee, for work of equal value; and (b) Favoring a male employee over a female employee with respect to promotion, training opportunities, study and scholarship grants solely on account of their sexes. Criminal liability for the willful commission of any unlawful act as provided in this Article or any violation of the rules and regulations issued pursuant to Section 2 hereof shall be penalized as provided in Articles 288 and 289 of this Code: Provided, That the institution of any criminal action under this provision shall not bar the aggrieved employee from filing an entirely separate and distinct action for money claims, which may include claims for damages and other affirmative reliefs. The actions hereby authorized shall proceed independently of each other. (As amended by Republic Act No. 6725, May 12, 1989). ART. 136. STIPULATION AGAINST MARRIAGE. 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 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. ART. 137. PROHIBITED ACTS. (a) It shall be unlawful for any employer: (1) To deny any woman employee the benefits provided for in this Chapter or to discharge any woman employed by him for the purpose of preventing her from enjoying any of the benefits provided under this Code. (2) To discharge such woman on account of her pregnancy, or while on leave or in confinement due to her pregnancy;
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LABOR LAW 1 (POST-MIDTERMS) (3) To discharge or refuse the admission of such woman upon returning to her work for fear that she may again be pregnant. Discrimination Prohibited Acts of Discrimination: Payment of lesser compensation for work of equal value Favoring over promotion, training opportunities, study and scholarship grants solely on account of their sexes Institution of any criminal action under this shall not bar the aggrieved employee from filing an entirely separate and distinct action for money claims, which may include claims for damages and other affirmative relief Actions authorized shall proceed independently of each other Void Stipulations Against Marriage Either as a condition for employment (pre) or for continuing employment (post) Prohibited Acts Deny benefits or discharge any woman employed to avoid giving benefits Discharge such a woman on account of her pregnancy or while on leave or in confinement due to her pregnancy Discharge or refuse the admission of such woman upon returning to her work for fear she may again be pregnant Rationale: to prevent discrimination of women in terms of employment (MEMORIZE Art. 135, 136, 137)
JUSTICE VICENTE S.E. VELOSO
ART. 139. MINIMUM EMPLOYABLE AGE. (a) No child below fifteen (15) years of age shall be employed, except when he works directly under the sole responsibility of his parents or guardian, and his employment does not in any way interfere with his schooling. (b) Any person between fifteen (15) and eighteen (18) years of age may be employed for such number of hours and such periods of the day as determined by the Secretary of Labor and Employment in appropriate regulations. (c) The foregoing provisions shall in no case allow the employment of a person below eighteen (18) years of age in an undertaking which is hazardous or deleterious in nature as determined by the Secretary of Labor and Employment.
EMPLOYMENT OF MINORS
ART. 140. PROHIBITION AGAINST CHILD
No employer shall discriminate against any person in respect to terms and conditions of employment on account of his age. Minimum Employable Age Below Shall not be employed, except: 15 1) Years - when working under under the sole responsibility of his parents or guardian, and - where only members of the employer’s family are employed and - his employment does not endanger his life, safety, health and morals, nor impair his normal development, and - the parent or legal guardian shall provide said minor with the prescribed primary and/or secondary education 2) - child’s employment in public and entertainment or information through cinema, theater or radio or television is essential, - PROVIDED employment contract is concluded by child’s parents or guardian with express agreement of child and DOLE if possible AND employer ensures child’s protection, health, safety and morals (RA 7610) 15In undertakings which are NOT below hazardous or deleterious 18
ART. 138. CLASSIFICATION OF CERTAIN WOMEN Any woman who is permitted or suffered to work, with or without compensation, in any night club, cocktail lounge, massage clinic, bar or similar establishments under the effective control or supervision of the employer for a substantial period of time as determined by the Secretary of Labor and Employment, shall be considered as an employee of such establishment for purposes of labor and social legislation.
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LABOR LAW 1 (POST-MIDTERMS) 18 Years No prohibition
JUSTICE VICENTE S.E. VELOSO Provided, That the employers shall review the employment contracts of their househelpers every three (3) years with the end in view of improving the terms and conditions thereof. Provided, further, That those househelpers who are receiving at least One thousand pesos (P1,000.00) shall be covered by the Social Security System (SSS) and be entitled to all the benefits provided thereunder. (As amended by Republic Act No. 7655, August 19, 1993). ART. 144. MINIMUM CASH WAGE. The minimum wage rates prescribed under this Chapter shall be the basic cash wages which shall be paid to the househelpers in addition to lodging, food and medical attendance. ART. 145. ASSIGNMENT TO NON-HOUSEHOLD WORK. No househelper shall be assigned to work in a commercial, industrial or agricultural enterprise at a wage or salary rate lower than that provided for agricultural or non-agricultural workers as prescribed herein. ART. 146. OPPORTUNITY FOR EDUCATION. 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 househelper’s compensation, unless there is a stipulation to the contrary. ART. 147. TREATMENT OF HOUSEHELPERS. The employer shall treat the househelper in a just and humane manner. In no case shall physical violence be used upon the househelper.
Hazardous or Deleterious: exposes workers to dangerous environmental elements, contaminations, or work conditions including ionizing radiations, chemicals, fire, flammable substances, noxious components and the like engaged in construction work, logging, firefighting, mining, quarrying, blasting, stevedoring, dock work, deep-sea fishing and mechanized farming engaged in the manufacture or handling of explosives and other pyrotechnic products exposed to or use of heavy or power-driven machinery or equipment use or are exposed to power-driven tools
ART. 141. COVERAGE. This Chapter shall apply to all persons rendering services in households for compensation. "Domestic or household service" shall mean service in the employer’s 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 employer’s household, including services of family drivers. ART. 142. CONTRACT OF DOMESTIC SERVICE. The original contract of domestic service shall not last for more than two (2) years but it may be renewed for such periods as may be agreed upon by the parties. ART. 143. MINIMUM WAGE. (a) Househelpers shall be paid the following minimum wage rates: (1) Eight hundred pesos (P800.00) a month for househelpers in Manila, Quezon, Pasay, and Caloocan cities and municipalities of Makati, San Juan, Mandaluyong, Muntinlupa, Navotas, Malabon, Parañaque, Las Piñas, Pasig, Marikina, Valenzuela, Taguig and Pateros in Metro Manila and in highly urbanized cities; (2) Six hundred fifty pesos (P650.00) a month for those in other chartered cities and first-class municipalities; and (3) Five hundred fifty pesos (P550.00) a month for those in other municipalities.
EMPLOYMENT OF HOUSEHELPERS
ART. 148. BOARD, LODGING, AND MEDICAL The employer shall furnish the househelper, free of charge, suitable and sanitary living quarters as well as adequate food and medical attendance.
ART. 149. INDEMNITY FOR UNJUST TERMINATION OF SERVICES. If the period of household service is fixed, neither the employer nor the househelper may terminate the contract before the expiration of the term, except for a just cause. If the househelper is unjustly dismissed, he or she shall be paid the compensation already earned plus that for fifteen (15) days by way of indemnity.
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LABOR LAW 1 (POST-MIDTERMS) If the househelper leaves without justifiable reason, he or she shall forfeit any unpaid salary due him or her not exceeding fifteen (15) days. ART. 150. SERVICE OF TERMINATION NOTICE. If the duration of the household service is not determined either in stipulation or by the nature of the service, the employer or the househelper may give notice to put an end to the relationship five (5) days before the intended termination of the service. ART. 151. EMPLOYMENT CERTIFICATION. Upon the severance of the household service relation, the employer shall give the househelper a written statement of the nature and duration of the service and his or her efficiency and conduct as househelper. ART. 152. EMPLOYMENT RECORD. The employer may keep such records as he may deem necessary to reflect the actual terms and conditions of employment of his househelper, which the latter shall authenticate by signature or thumbmark upon request of the employer. Househelper – engaged in the employer's home, whose services are usually or desirable for the maintenance and enjoyment thereof, and ministers exclusively to the personal comfort and enjoyment of the employer's family Original Contract not more than 2 years but may be renewed If assigned to work in a commercial, industrial or agricultural enterprise, must not be paid lower than agricultural or non-agricultural workers If under 18 years of age, must be given opportunity to finish at least elementary schooling - cost of education shall be part of compensation, unless stipulated otherwise Treated in a just and humane manner; no physical violence Free : Sanitary and suitable living quarters Adequate food Medical attendance (Veloso: What is adequate? no hard and fast rule; common sense would tell you what is right and wrong) Indemnity for unjust termination if there is a Fixed Period of Service Compensation already earned + 15 days
JUSTICE VICENTE S.E. VELOSO If no fixed period, notice of termination must be given at least 5 days prior Domestic helper is not one who works for a staff house / rest house; the criteria is that the helper administers to the comfort of the family of the employer in the home of said employer. [Apex Mining Company,Inc. v. NLRC 196 SCRA 251 (1991)]
EMPLOYMENT OF HOMEWORKERS
ART. 153. REGULATION OF INDUSTRIAL
The employment of industrial homeworkers and field personnel shall be regulated by the government through the appropriate regulations issued by the Secretary of Labor and Employment to ensure the general welfare and protection of homeworkers and field personnel and the industries employing them. ART. 154. REGULATIONS OF SECRETARY OF LABOR. The regulations or orders to be issued pursuant to this Chapter shall be designed to assure the minimum terms and conditions of employment applicable to the industrial homeworkers or field personnel involved. ART. 155. DISTRIBUTION OF HOMEWORK. For purposes of this Chapter, the "employer" of homeworkers includes any person, natural or artificial who, for his account or benefit, or on behalf of any person residing outside the country, directly or indirectly, or through an employee, agent contractor, sub-contractor or any other person: (1) Delivers, or causes to be delivered, any goods, articles or materials to be processed or fabricated in or about a home and thereafter to be returned or to be disposed of or distributed in accordance with his directions; or (2) Sells any goods, articles or materials to be processed or fabricated in or about a home and then rebuys them after such processing or fabrication, either by himself or through some other person. D.O. 5 (1992) Applies to any person who performs industrial homework for an employer, contractor or subcontractor.
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LABOR LAW 1 (POST-MIDTERMS) Industrial Homeworker System of production under which work for an employer or contractor is carried out by a homeworker at his / her home. Materials may or may not be furnished by the employer or contractor. Employer of a Homeworker any person who delivers or causes to be delivered any goods, articles or materials to be processed or fabricated in or about a home and thereafter to be returned or to be disposed of or distributed in accordance with his direction; or sells goods, articles for the purpose of having such goods or articles processed in or about a home and then repurchases them himself or through another after such processing NOTES: Regulation under Art. 154 must be that would make the homeworker receive the statutory minimum wage for 8 hours of work. For instance, it is illegal for an employer to pay a homeworker P 50 for 10 pieces of materials done in 8 hours of work. The employment of homeworkers is one of the exceptions to the four-fold test in determining EER. There is no control since the employer only supplies the materials and rebuys them. But the law considers them as employees. Q: Considering that a homeworker is not being hired and cannot be fire, why is he considered an employee? A homeworker is considered an employee for him to be entitled to the benefits accorded by the law. Omnibus Implementing Rules provide: Book III, Rule XIV, Sec. 6 – entitled to SSS, MEDICARE, ECC benefits (employer required to make such contributions) Book III, Rule XIV, Sec. 4 – homeworkers have the right to self-organization
JUSTICE VICENTE S.E. VELOSO
Who are entitled? 1) All Rank & File employees who worked at least 1 month 2) Those with Multiple Employers (includes gov’t employees with part time work in a private company) 3) Paid by Result 4) Private School Teachers regardless of the number of months taught 5) Resigned or Separated employees (proportional) NOT entitled: 1) Gov’t. employees 2) Household helpers 3) Those already being paid an equivalent at the time of issuance of PD 851 4) Employees paid purely on commission, fixed, boundary or task basis Minimum Amount: Not less than 1/12 of total basic salary earned within a calendar year Basic Salary For purposes of 13th mo. pay, shall include all remunerations or earnings paid by his employer for services rendered But does NOT INCLUDE: allowances and monetary benefits which are not considered or integrated as part of the regular or basic salary such as vacation and sick leave credits, OT premium, night differential, holiday pay and COLA UNLESS by individual or collective agreement or company practice or policy, they are treated as basic salary. NOTES: Rationale of the requirement 1 month work rendered to be entitled to 13th month pay: what the law talks about is a 13th MONTH pay, so the base is 1 month (not 1 day day or 1 week) Example: worked for 29 days only, but entitled to 2 months allowance, whether worked or unworked not entitled to 13th month pay. Do not consider the allowance for 2 months because the employee did not work for those 2 months. Supervisors are NOT entitled to 13th month pay because they are not R&F employees. Maternity benefits, like other benefits granted by the SSS, are granted to employees in lieu of
PRESIDENTIAL DECREE NO. 851: REQUIRING ALL EMPLOYERS TO PAY THEIR EMPLOYEES A 13TH-MONTH PAY
13th Month Pay Demandable as a legal obligation In the nature of wages, not bonuses Provided by law Not computed as additional benefits
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LABOR LAW 1 (POST-MIDTERMS) wages and is not included in computing the employee’s thirteenth month pay for the calendar year. Those paid on commission, fixed, boundary or task basis are exempted because there is no way of ascertaining 13th month. BUT those paid on a piece rate basis are entitled to 13th month pay because you can quantify this. (E to E of task basis) Philippine Duplicators Inc. v. NLRC, 241 SCRA 380 Where the commission forms part of the basic compensation for their services, comprising an automatic increment to the monetary value assigned to each unit of the work done, and the fixed rate represents only a small percentage of the earnings (15-30%), the commissions are part of the basic wage structure. (included in computing 13th month pay) But where they are paid as productivity bonuses tied to the productivity or capacity for revenue production, they closely resemble profit sharing and have no clear, direct, or necessary relation to the work done by each employee. It being a bonus, it is not demandable as a matter of right. If an employer cannot be compelled to pay a productivity bonus, then that bonus is not within the basic salary. (not included in computing 13th month) Veloso’s discussion on Jurisprudence related to 13th month pay: Marcopper case: Benefits are either contractual or statutory; the employer has to pay both kinds. The 13th month pay in PD 851 is separate and distinct from the pay given by the CBA. The employer must pay both. (Veloso says this is an ignorant ruling. It missed Sec. 2) NFSW v. Ovajera (1981): Sec. 2 of PD 851 provides that those paying an equivalent of the 13th month pay are exempted from having to pay the same. In this case, the employer under the CBA is already paying a mid-year bonus and a Christmas bonus. SC held that the midyear bonus in itself constituted a 13th month pay already. Dole v. Legardo: if the equivalent is less than the required amount to be paid (i.e. less than 1/12), pay the difference Philippine Refining Company case (1985): The Sec. 2 equivalent exempts only those paying bonuses, etc. at the time of the enactment of PD 851 in 1975. In this case, the CBA granting
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JUSTICE VICENTE S.E. VELOSO Christmas bonus did not exist yet in 1975 so the said bonus cannot be counted as compliance with PD 851. Universal Corn Products v. NLRC (21 August 1987): Bonus in the CBA is intended to be in addition to PD 851, so pay both. Tamayo Hotel v. NLRC: Opposite of Universal Corn. Bonus is deemed as compliance so there is no need to pay PD 851 benefits. United CMC v. Valenzuela: Where the CBA Christmas bonus is intended to be a longevity bonus, it different from PD 851 pay. Pay both. In this case, the purpose of the bonus is based on the length of service. PD 851 does not require the benefit to be anchored on any qualifying factor (other than 1 month service and R&F requirement). If there is any condition upon which payment of 13th month pay is made to depend, then it would not be deemed compliance with PD 851. UST Faculty Union v. NLRC: Christmas gift is not equivalent to a Christmas bonus. Thus, it cannot be considered as 13th month pay. FEU Employees Union case: Transportation paid in the nature of a midyear bonus is considered an equivalent.
REPUBLIC ACT NO. 7877: ANTI-SEXUAL HARASSMENT ACT OF 1995
What venues are covered by this Act? Work, education or training environment (WET) Who are the persons who may be charged with sexual harassment under this Act? An employer, employee, manager, supervisor, agent of the employer, teacher, instructor, professor, coach, trainor, or any other person having authority, influence or moral ascendancy (AIM) over another in a work or training or education environment (§3) How is sexual harassment committed under this Act? When any of the persons enumerated above demand, request or otherwise require any sexual favor from another, regardless of whether the demand, request or requirement for submission is accepted by the object of said act (§3) Describe sexual harassment in a work-related or employment environment. It is committed when:
LABOR LAW 1 (POST-MIDTERMS) 1. The sexual favor is made as a condition in the hiring or in the employment, re-employment or continued employment of said individual, or in granting said individual favorable compensation, terms of conditions, promotions, or privileges; or the refusal to grant the sexual favor results in limiting, segregating or classifying the employee which in any way would discriminate, deprive or diminish employment opportunities or otherwise adversely affect said employee; The above acts would impair the employee's rights or privileges under existing labor laws; or The above acts would result in an intimidating, hostile, or offensive environment for the employee (§3a) 2.
JUSTICE VICENTE S.E. VELOSO to provide the procedures for the resolution, settlement or prosecution of acts of sexual harassment; Promulgate rules and regulations in consultation with and jointly approved by the employees or students or trainees, through their duly designated representatives, prescribing the procedure for the investigation of sexual harassment cases and the administrative sanctions therefor; and Create a committee on decorum and investigation of cases on sexual harassment (§4) disseminate or post a copy of this Act for the information of all concerned (§4)
Who can be a victim of sexual harassment in an education or training environment? It may be committed against: 1. One who is under the care, custody or supervision of the offender; or 2. One whose education, training, apprenticeship or tutorship is entrusted to the offender (§3b) What constitutes sexual harassment in an education or training environment? In cases when: 1. the sexual favor is made a condition to the giving of a passing grade, or the granting of honors and scholarships, or the payment of a stipend, allowance or other benefits, privileges, or consideration; or 2. the sexual advances result in an intimidating, hostile or offensive environment for the student, trainee or apprentice (§3b) Who are the other persons who may be liable under this Act? Any person who directs or induces another to commit any act of sexual harassment as herein defined, or who cooperates in the commission thereof by another without which it would not have been committed (§3) Duties of the employer or head of office in a work-related, education or training environment: 1. to prevent or deter the commission of acts of sexual harassment;
What should be contained in the rules and regulations? The said rules and regulations issued shall include, among others, guidelines on proper decorum in the workplace and educational or training institutions (§4) Functions of the committee: 1. conduct meetings, as the case may be, with officers and employees, teachers, instructors, professors, coaches, trainors, and students or trainees to increase understanding and prevent incidents of sexual harassment; and 2. conduct the investigation of alleged cases constituting sexual harassment (§4) Does the imposition of administrative sanctions bar prosecution in the proper courts for unlawful acts of sexual harassment? No. the victim of work, education or trainingrelated sexual harassment is not precluded from instituting a separate and independent action for damages and other affirmative relief (§6) Is there any case where the employer, head of office, educational or training institution is made liable? Yes, they may be solidarily liable for damages arising from the acts of sexual harassment committed in the employment, education or training environment if they had been informed of such acts by the offended party and no immediate action is taken (§5) What is the prescriptive period for violation of any of the provisions of this Act? 3 years (§7)
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LABOR LAW 1 (POST-MIDTERMS)
JUSTICE VICENTE S.E. VELOSO
SALIENT FEATURES OF THE SSS LAW AND GSIS LAW
Social Security Act of 1997 (RA 8282) - Any person, natural or judicial, domestic or foreign who carries on in the Philippines any trade, business, industry undertaking or activity of any kind and uses the services of another person who is under his orders as regards employment 8 (c) - Exempt employer: government and any of its political subdivisions, branches and instrumentality, including GOCCs a. Dependent Spouse until remarriage AND b. Dependent Legitimate or Legitimated or Legally Adopted and Illegitimate Children Government Service Insurance Act of 1997 (RA 8291) - The national government, its political subdivisions, branches, agencies or instrumentalities, including GOCCs, and financial institutions with original charters, the constitutional commissions and the judiciary
BENEFICIARIES 1. PRIMARY
Legal, Dependent Spouse until remarriage AND b. Dependent Children
Dependent Parents; AND Legitimate descendants subject to restrictions on dependent children, legitimate descendants
Absent primary and secondary beneficiaries, any other person designated by member as secondary beneficiary As to DEATH BENEFITS, If no beneficiary qualifies under the Act, benefits shall be paid to Legal Heirs in accordance with Law of Succession Monthly Pension Dependents Pension Retirement Death Permanent Disability Funeral Sickness Maternity (ONLY 1ST FOUR DELIVERIES OR MISCARRIAGES)
ALL MEMBERS a. Life Insurance b. Retirement c. Disability d. Survivorship e. Separation f. Unemployment
JUDICIARY A. Life Insurance ONLY -ALL TAX EXEMPT Compulsory for all employees receiving compensation who have not reached compulsory retirement age, irrespective of employment status
COVERAGE 1. Compulsory
All employees not over sixty (60) years of age and their employers; compulsory coverage of the employer shall take effect on the first day of his
Ryan Quan 3C ’06-’07
LABOR LAW 1 (POST-MIDTERMS) operation and that of the employee on the day of his employment 2. self-employed employees as may be determined by the Commission under such rules and regulations as it may prescribe, including, but limited to: all self-employed professionals; partners and single-proprietors of business; actors and actresses, directors, scriptwriters and news correspondents not employees; professional athletes, coaches, trainers and jockeys, and individual farmers and fishermen; upon their registration with the SSS. 3. Domestic helpers who are sixty years of age and below with a monthloy income of not less than P1,000 on the date of their employment 4. individual farmers and fishermen under SS rules and regulations Voluntary: 1. Filipinos recruited by foreign-based employers for employment abroad 2. Employee separated from employment 3. Self-employed – realizes no income 4. Spouse who devotes full time managing household and family affairs unless specifically mandatorily covered By Arrangement: 1. any foreign government, international organization or wholly owned instrumentality employing workers in the Philippines or employing Filipinos outside the Philippines may enter agreement with Philippines for inclusion of such employees in SSS EXCEPT those already covered by their respective civil service retirement system. 1. employment purely casual and not for purpose occupation, or business employer 2. service performed on or in connection with alien vessel, if employed when such vessel is outside of Philippines 3. employees of Philippine government or instrumentality or agency thereof
JUSTICE VICENTE S.E. VELOSO
Exceptions (from coverage)
Members of the Armed Forces Members of the PNP
* members of judiciary and constitutional commissions: life insurance only
Ryan Quan 3C ’06-’07
LABOR LAW 1 (POST-MIDTERMS) 4. service performed in the employee of a foreign government, or international organizations, of wholly owned instrumentality employing workers in the Philippines or employing Filipinos outside of the Philippines 5. services performed by temporary and other employees excluded by SSS regulation; employees of bonafide independent contractors shall not be deemed employees of the employer engaging the services of an independent contractor Non-work connected disability, sickness, maternity, death and old age and other contingencies resulting in loss of income or financial burden (Sec. 2)
JUSTICE VICENTE S.E. VELOSO
BASIS OF CLAIM
Work-connected exempt from liability where permanent disability due to his grave misconduct, habitual intoxication, or willful intention to kill himself or another (Sec. 15-17)
END OF REVIEWER
This reviewer is based on the sequence of topics discussed by Justice Veloso in class. Some, if not most, of the case titles are not accurate as they are the cases being randomly cited by Justice Veloso in class. This is in no way complete. Reading book/s in addition to this is highly recommended. ACKNOWLEDGEMENTS Parts of this reviewer were taken from the Labor Law Reviewers of the Ateneo Central Bar Operations 2006 and from Doranne Lim’s reviewer for Justice Veloso’s Labor Law Review class. Thanks to Lea for helping do the case doctrines and Cecille for her notes in class. ☺ God bless!
Ryan Quan 3C ’06-’07