E;

OVERVIEW: tr'UNDAMENTALS

ln reviewing Labor Law, wherri do iou begin? Begin with the statements of
objectives, policies and fundame"dt rigtt in the Constitution, the civil
Code, the Corporation Code and

th[ l-abor Code-

1. Constitutional Fouridstions

a. Declaration of Principles

*ii

Poli"i", (Article II)

The Constitution command$ the State to promote a just and dynamic

thru employmont, a rising
standard of living and an improved quality of life. The State shall promote
sbcial justice in all phases ofnational development.

Capitai and labdr are recoguizpd with balance. Labor is affirmed as a

primary social economic force, htit capital is recogrrized as performing an
indispensable role.

Because private enterprise is encouraged, the right to own pqiv4Le

property is recognlzeil and protected. No person (natrnal or juridical) can be
deprived of life, liberty or property without due process of law. Inheritance
of property is allowed. Nonetheless, use of property bears a social function,
and all economic agents shall contribute to the common good. (Art. XII, Sec.

b)
Corporate right or porver tri manage is recognized. The constitrtion
gvps the people the right 'to own, establish and operate ecare
enterprises, subject to the duty of the State to promote distrih,iE ilfic
and to intervene when the common good so demauds'l (Art XII, 'Se- 6I
These provisions are clear indications of the Philippine's "miiof ry*
system, i.e., capitalistic but goveinment-regulated' The goal and ideology
t:-

are social justice; the means and lrocess are basically private property and
the market system.
The Bill of Rights (/\rt. IID
The people's right to freedbm of, association, including formation of
r',ions, carinot be abridgcd, ndt may a law bc passod impairing thc

b.

contracts. (ienerail!,; therefore, employment contracts and

collective bargaining stipulations iie lawful.

obligation

of

Goals ofthe Econonqz.

Highest priority in law-rnaling is to be given to the reduction of

social, economic and political inequalities through diffiision of wealth and
political power. This pror"ision reiterates Article XII which dcclares the
goals of the national economv, namely:

(l)

Equitablc distribution of
(2)Sustained ircrease in the
the nation

alLunt

income, and wealth.

of goods and servioes produced by

To this end, the State shall regulate the acquisition, ownership, use,
and disposition of property.
:

d.

Rights

oflaborand ofCapital

CcinsisEnt with balanced treaunent, dre rights of labor and of capital,

are stated also with balance. The Constitution names seven guaxanteed rights
of labor, namely:
PR (Participatoryrifdt in policy making)
SO (Self-Organization)

CB (Collective Bargaining)
C A (Concerted Acti vity)
ST (Security ofTanure)
LW (Living Wage)

HC (Humane Conditions)
Labor

has,

the right to just sliilre in the fruits of production.

Capital (private eoterprise) has the. right to. reasonable return on

invOstnents and to expansion and

fpwth (ROI-EG).

2. Civil Code
Why does the employer flr" th" power to run or marmge the
business? Because he owns it. A business is property, and the Civil Code
law on rights of propet'ty owrrership applies: jus utendi" jus fruendi, jus
abutendi, jus disponendi, jus vindicandi.

But these are rights over property, not rights over people. People are
needed because property is not productive (in economic sense) without
humari effort. Labor is necessary, Lut because people are not propcrty the
connection with the employer is not "ownership" but 'telationship".
Property like land, stocks and machines can be owned but people carmot be
owned though legally they ryay be managed or controlled. So Article 1700
cautions: "The relations between capital and 'labor are not mercly
contractual. They are so impressdf with public interest that labor contracts
must yield to the cornmrrn good. Such contracts are subject to special
laws.

..

"

t
I

Those Special laws are the labor laws. Labor laws therefore arose
because the laws on'property ownership do not define employer-omployee
relationship. Unlike property, perlple are living entities endowed with
dignity, reason and rights. Labor laws informally began when group
production of industrial goods be$an in the 1600s, when people started using
' poople to creato wealth. I-ahor law governs &e legal aspect of MoGregor's
human side of the enterprise.

Employment relationship (or "E-E Rel", employer-employee

relationship) is both legal and huhran in character. Not every employment

relations issue is resolved by legaliBtic provisions. Not conforming with the

positive law theorists, the Civil Ctide's first Article on Human Relations
(Art. 19) commands: *Evry persort t rst, in the exErcise of his rights and in
the perforrrance of his duties, act *ith justice, give everyone his due, and
observe honest5r and good faith." Tllrrs, the employer has the power to select
people, transfer people, promote or demote and even dismiss people, but all
these must be done in good faith.

3. Corporation Code
But what legitimizes the empioyer's control power over people? One,
the employment itself, u'hich is a contract, bocause a contract (written or
unwritten) is generally a binding law between the parties. Two, the
Constitution (Article XII, Sec. 6) that recogrrizes the right of corporatirons
"to operate economic tnterprioes." Third, the Corporation Code that
grants corporations "the powdfs, attributes and properties vxpressly
atrthorized by law or ms!&ntslO-As-9x!s!9n99" (BP Blg. 58, Sec. 2).

Thus, thc employer enterirrise oan enter into contracts, initiate

projects, or make policies and enforce them. The same Code requires
Articles of Incorporation which, after government approval, authorizes
the organization to pgrsrre it3. approved business obiectives and to
"exercise such other powers as may be essential or necessa{v to caxry out
its purpose or purposes as stakd in the articles of incorporation" (Sec.
36). The Corporate Code firther allows and approves corporate by-laws
that name the corporate ttfiEcers and their duties (Sec. 25). The duties
include creation of management positions to implement the core
management functions of PO[.C. (planning, organizing, leading and
controlling). Indeed, ma:nagemerlt arose as a distinct kind of work whem
group economic activities startd getting formally organized in late
1800s. This economic trend also gave birth to labor laws and personnel
management.

r.

.,,..

,-r.:

.:

- -,rjrt..,-i:-..E t?:.

--3, ' :-+"-yj,ii :F_j.'+:..i

Code, Couit decisions recognrize

Finally, aside from the
the powel of management l'to l6gulatq all aspects of employment" (San
Miguel BreweryS'ctres ys'. Oplel G-R. No. 5i515, Feb' 18, 19E9)

4. LaborCode
2, 218, 252, 256, 293. These are not statements
of labor law oljcctives but of p<ilicy instruments to attain the goals' The
goals are stated in the Constitutiot.
Read Art. 3 ; 4, 12,

17

A. DEFINITIONSOF SOMI] KAY CONCEPTS:

is an ordinance of reazun promulgated by the lawmaking body for the

corrmon good (Aquinas). It is a rule of civil conduct prescribed_by the
suprme powor in ,a state commanding what is right and prohibiting what is

Llw

wrong ( Blackstone).

f,,MPLoYMf,NT is a legal and human relationship tluit arises when a person

(natural or juridical) hires for a compensation tle services of another tmder

the hirer's supervision or control in an economic undertaking' The goal

of

.,

-:.,]-!

social andlabor laws is social justicb. As indicated in Calalang vs. WitU"*.,

social justice is the humardzation,bf laws and equalization of social and
Eoonomic forces by thc Stalo It is pwsued by fostcring thc logal protection,
the economic well-being and pdity, and the political equality of the
members of society. Social justicd is a continuing goal and process. lt is
never fully achieved at any particuillr time because it contends with the base
traits such as self-aggrandizement alid greed.

A C0DE is a cornpilation of

law's felating

to an identified area of societal

activities and relationships.

The

!4@.1Q,;qg (PD

442as amended) is the compilation of our principal

labor laws.

ln the terms "labor law" and "labor code", "labor" does not refer only to
workers as laborers. "Labor" raditr connotes work, workers, and work
relationsfups. Work covers physl$al and mental application. "Worker"
means a person that applies physical, mental or maerial resources. A worker

therefore may be a supplir:r or a hirer of work. If there is employment

relationship the supplier of work is called employee; the hirer is called
employer.

B. Two areas of Labor Law: labor staffdards and labor relations. How are they
related?

II. EMPLOYMENT: I,OCAL AND OVERSEAS

A. RECRUITMENT AND PI,ACEMUXT (R & P) DEFINED; I I ACTSI
R & P takes place even il' omployment is offered for a fee to only one
penion; hence a license is rerluired.
or more persons, a pre$rmption
arises that the offeror is engagtd in recruitment and placement activity. A
license to be so engaged should have been obtained. (See ELC, p. 16)

If employment is offered fol a fee to two (2)

-.'

B.

TWO KINDS OF ILLEGAL RECRUITER: (l) licensed and (2)

unlicensed.

JURIS.UPDATE:
For a licensed recruitment agency
recruitment'?

"illegal

Illegal Recruitrnent Redefined: Two Kinds

As defined both rmder Art. l3(b) of tho Labor Code and Sec. 6 of
R.A. 8042 as amended by R.A. 10022: Recruitment and Placement (R & P)
refers to any act of canvassing, enlisting, contracting, transporting, utilizing,
hiring or procuqing workers and includes referrals, contract serr'ices,
promising of advortising for ernploymcnt abroad, whcthcr for profit or not."

The SECOND KIND is the commisiion of any of the fourteen (14)

acB enumerated in Section 6 of R.A. No. 8042 ds amended'by R.A. No.
10022, whethsr the perpetrator is
authority: (See SLL, W.6-7)

. (l) To.charge or acgept directly qr indirectly

any amount of money gr"?t"t

than that specified in the schedule of all(iwable lbes prescribed by the Secretary of
Labor and Employme,nt, or to rpako a '1,rorker pay or ackrowledge any amormt
greater than that actually received by hiry'as a loan or advance;

(2) To furnish or publish any false notice or information or document in

(3) To give any false notice,

, information or document or commit
any act of misrepresentation for the pufpose of securing a license or authority
rmdcr the Labor codo, or for the po.por{ of documenting hircd workcrs with thc
POEA, which include the act oI'reprocdssing workers through a job order that
pe*ains to non-existent work, work didbrent frorn the actual overseas work, or
work with a differe$t employer whether r&gistered or not with the POEA;

(4) To induce or attempt to inducd a worker already employed to quit his

employment in order to offer him another unless the transfer is desiped to liberate
a workcr from oppressive terms atrd condiiions of emplolment;

(5) To influence or attempr to influence any person or entity not to employ

any worker who has not applied for employment through his age'ncy or who has
fonned, joined or supported, or has contacted or is supported by any rmion or
workers' organization;

(6) To engage in the recruinnent

oi: placemont of workers in jobs harmful to

public health or morality or to the dignity of the Republic of the Philippines;

(?) To obstruct or attempt to obstruct inspection by the Secrotary of Labor

and Employment or by his duly at:tlrorized representative.

(S) To fail to submit reports on: the status of employment, placement

vacancies, remittance of foreipa exchange earnings, separation from jobs,
deparhres and such other matterrs or information as may be required by the
Socretary of Labor and Employme nt.

(9) To substitute or alter to. the prejudice of the worker, employment

contracts approved and verified by the f)epartnent of Labor and Employment
from tho time of actual signing thc rcof by'the parties up to and including the pcriod
of the expiration of the same with out the approval of the Department of Labor and
Employment.

(10) For an officer or agent of a recruitment or placement

agency to
become an officer or member of ttre Board of any corporation engaged in travel

agency

or to

(12)

be, engaged directly or

Failure to actually deploy a

in the management of a travel

worker without valid reason as

(13)

Failure to reimburse expenses incurred by the worker in connection

with his documentation and processing for purposes of deployment, in cases where
the deploy.ment does not actually take place rvithout the worker's fault.

'litizen to head or manage

licensed

C. DIF'FERENTIAT4 "LICENSE" FROM,"AUTHORITY- TO

RECRUIT.

"Authority' is a

document issued by DOLE' authorizing a person or

association to engage in R & P activities as a private recruitnent entity. A
private recruitment entrty is any pcrson or associatibn bngaged in the R .,lL P
of workers, loially or overseas, wi
arqing, directly or hdirectly, lany
fee from the workers or employers.

'.
D. ECONOMIC SABOTAGE
10

F!..

El
i

Rccruilmcot

Bcooomic
Sabotaec

Imprisonment of
not less than 12
yean and I day
but not more than
20 years, and;

Life

Fine ofnot less

thatr
P1,000,000.00
nor more lhan
P2.000.0@.00

Fine ofnot less

imprisonmenl
and;

Imprisonment of
not less thaf, 6
yerfs 8nd I day
but not more than
l2 years, and;

Automatic
revocatior of the
license or
registration of the
r cs[urulEuu ulaulrq5
agency, lending
institutions, training
schools or medical

clinic
ttun
P2,OOO,OOO"00

nor more dran

P5,000,000,00
Ivlaximum
penalty if the
person illegally
recruited is less
than 18 years of
age, or committod
by a aon-licensee
or non-holder of

Fine ofnot less

thar P500,000.00
nor more lhan
Pl,000,000 00
Deportatign,
without need for
prooeedings, if
offender is an
alien

aulhoriE

E. PROHIBITED ACTS

Aftcr enumcrating the aots constituting illcgal recruitrnent and aftcr

the provision atout illegal recruitrnent as economic sabotage, the lengthy
Section 6 of R.A. No. 8042 enunerates seven (7) acts which are rmlawfrrl
for any person or entity to commit. The seven prohibited acts are the
following: (SLL, pp. 7-8)

Grant a loan to an overseas Filipino worker with interest exceeding eight

percent (8%) per annum, which nill be used for payment of legal and
allowable placement fces and dake the migrant workcr issue, eithcr
persbnally or through a guarantor [r accornmodation party, postdated cheoks
in relatiron to the said loan;
(I

(2) Impose a compulsory and exchrsive arrangement whereby an overseas

Filipino worker is required to avail of a loan only from specifically
dcsignated institutions, entitios or psrsons;

(3) Refuse to condone or renegotiate a loan incurred by au overseas Filipino

worker after tle lauer's employment contract has been premahrrely
terminated tbrough no fault of his or her own;

(4) Impose a compulsory and exclusive arrangement whereby an overseas

Filipino worker is required to undorgo health examinations only from
specifically dcsignated medical clinics, instirutions, entities or persons,
except in the case of a seafarer whose medical examination cost is

(5) Impose a compulsory and exclusive arrangement whereby an overseas

Filipino worker is required to undergo training, seminar; instruction or
schooling of any kind only from specifically designated institutions, entities
or . pcrsons, oxccpt for . recorumendatory trainings maudated by
principals/shipowners where the laffier shouldor the cost of such trainings;

(6)lFor a suspended recruitment/manning agency to engage in any kind of

recruitment activity including the processing of pending workers'
appli cations; and
,i,

(7) For a recruitrnent/manning agency ol a foreign principaUemployer to

pass on the oversoas Fitipino wo{er or doduct from his or her salary the
payment of the cost of insurance fees, premium or other insurance related
charges, as.provided under the combulsory worker's insurance coverage.

F. PERSONS LIABLE FOR ILLEqAL RECRUITMENT AND THE

PROHIBITED ACTS

13

of individual pcrsons, thc officcri having owncrshiir, control, managcmcnt

or direction of their business and *ho are responsible for the commission of
the offense and the responsible emfiloyees/agents shall be liable.

G. PRE.TERIVIINATION OT EMPIOYMENT CONTRACT

Under Section 10, R.A. No. bO+2, if the OFW's employment is
terminated witiout valid reason, the OFW is entitled to:

(a) frrll reimbursement of the placement fee with 127o interestplus the salary
for the unexpired portion of the contract, or
(b) for three (3) months' salary f,or evcry year of the unexpired term, wtichever
is loss.

In Serrano vs. Call4nt Maritime (March 24- 200?), the Court declared the
phrase "whichever is less" rurconstitutional. Because of this ruling the 3
months' salary option is no longer available; hence, the salary for the unexpired
portion of the employment contract plus refimd of placement fee with 12%
interest must be paid to the OFW.
Question arises, however, whether the declaration of nullity in Serrano on
March 24,2009 still holds, considering that R.A. No. 10022, passed in March
2010, restatcs in R.A. No. 8042 the two options "whichever is less." What is the
effect of re-enacting a legal provision which has been declared
wrconstitutional?

I{. DIRf,CT-HIRING
No employgr may hire a Filiprno worker for overseas employment
except through the Boards and entil;ies authorized by the Secretary of Labor.
Dircct-hiring
mcmbprs
thc diplomatic corps, intcmational
organizations and such other employers as may be allowed by the Secretary
of Labor is exempted from this prov.ision. Article 18. Labor Code.

by

of

1tt

o
o

Employers cannot directly hire workers lbr overseas employment

EXCEPT through authorized entities. (See below)
The reason for the ban is to ensure full rogulation of employment in
order to avoid exploitation.

Entities authorized to engage in reciuitment and placement

1. Public employment,offrcers
2. Philippine Ovcrscas Ernploymerrt Administration (POEA)
3. Private recruitrnent agencies
4. Private employment agencies
5. Shipping or manning agents or representatives
6. Such other persons or entities as may be authorized by the DOLE
Secretary

7. Construction contractors

I.

NATURE OF THE LIABILITY OF. LOCAL

AGENCY AND FOREIGN PRINCTPAL
Local agency is solidmily liablg, with foreign principal.

Joint and solidary liability of recruiter with Foreign Principal

A recruitnent agency is solidarily liable with the principal for the unpaid
salaries of a worker it recruited for employment overseas. Even if the
recruiter and tlre principal had alre4tly severed their agency agreement at the
time employee was injured, the repruiter may still be sued for a violation of
the employment contract becausfi no uotice of the agency agreement's '
termfuation was givcn to thc

EXTENDED EMPLOYMENT UNKNOWN

fO

THO AGENCY'

' *IMPUTED KNOWLEDGE" DPES NOT APPLY

The solidary liabiliq, of rhe pgency attaches only to the original period
the employment contract. If tt1$ employment period is extended by the

of

employer-principat without kno*iedge

agency's solidary liability does not hpply.

ln the Sunace

case the

of the agency, the rule' on the

oro.t". (Divina) was recruited by the Sunace

Recruiment Agency and deployed to Mr. Hang in Taiwan under a l2-month

ernployment contract. When the cbntract expired Mr. Hang cxtended it for
two more years, without infortiiing the Sunace. When the exended
employment ended Divina filed With the NLRC a complaint for trnpaid
salaries and illegal deductions dbne Uy Mr. Hang during the two-year
extension. Included as respondent, Sunace denied any liability, arguing that
its solidary liabiliy with the priricipal ended when the original l2-month
employment ended. The claimani countered that the principal's act of
extending the employment bound the agent because, despite lack of
information, the agency should be considered to have known and consented
to the act of the principal. This, sCid the claimanq is the theory of imputed
knowledge, i.e., the knowledge of the principal is imputed or attributed to
the agent.

The Supreme Court rejected and corrected the claimant's contention.

The theory of imputed knowledge teaches, in correct form, that the
lnowledgc of the agpnt is knowledgc of ths pEinei@I. It is not knowledge of
the principal is knowledge of the hgent. Hence, in this case Sunace, boi.g
ignorant of the emplo5rment extension and of the illegal acts of the
employer-principal during such extended, is free from liability. IThe theorv
of imoutcd }mowledse wes also not rpplied in New Life enterorises vg

CA. G.R No. 94071. March 31.

19921. (Sunace Interua

Manaeement Serviccs. INc. vs,-NLRC. ct al.. G.R: No. I
2s.2006)

l.

Severance ofrelations between local agent and

foreip principal does not'

affect liability of local recruiter.

J.

SUSPENSION ORCANCELLATION OF LICENSE OR

AUTHORITY
16

Power to suspend or cancel any license or authorit5r to recruit employeos for

overseai employment is concwrently vested with the POEA and the
Secrctar.v of Labor.

The Secretary of Labor hes the power, tu:der Art. 35 of the Code, to.apply
the sanctions, as well aS the authority, conferred by Art. 36, not only to
'restrict and regulate the recruilmont ;rnd placement activities of all
agencies,' but also to 'promulgato rules and regulations to earry out the
objectives and implement the provisions governing said activities.
Pursuant to this rule-making power thus granted, the Secretary of Labor
gave the POEA on its own initiative or uFon filing of a complaint or report
or upon request for investigation by any aggrieved person, (authority to)
conduct the necessary proceedingq.for the suspension or cancellation of the
'license or authority of any agency or entily for certain enumeratdd offenses
including:

l. The imposition or acceptance, directll or indirectly, of any amount of

money, goods or services, or any fee or bond in excess of what is
prcscribed by tho Adrninistatiep.
Any other violation of pertiner;i provisions of the' Labor Code and other
relevant laws, rules and regulations.

The Administator was also given the power to order the dismissal of the
case or the suspension of the licenso or authorily of the respondent agency or
contractor or recommend to the grinister (now Secretary) the cancellation
theroof.

IC RDCULATORY AND VISTTOBIAL P()WERS OF DOLE

SECRETARY
Regulatory Power
DOLE Secretary shall have the poyer to rc,strict and r egulate the recruitnent
and placement activities of all agepcies tm,l is authorized to issue orders and
promulgate rules and regulations [p cany out dte ob.iectives and implement
t7

the provisions of the Title on Recrtlitment and Placement of Worker. (Art

The Secretary of DOLE does not have the power to issue search warrets
and warrants of arrest. Satnzar v. Achacoso. lG.R. No. tl5l0. 14 Merct
r990r.

REPATRIATION OFOFW: (See SLL, pp..12-13)

2. recourse against the OFW:

Y.PERTOD

TOFTLE OrIW CLATMS:

Conflict between Art. 291 and the FOEa-SEC:

JURIS.IIPDATE

- - Within

how rnany years should an OFW's money

ctaim be filed?
T?ie POEA SEC (Standard Emplo;nnent Contract) states

in Sectior

28 that claims under the contract shall be filed within one (l) year from the
datc of thc scafaer's rctum to the point of hirc. On thc othcr hand, Article
29L of the t abor Code provides for three (3) years to file money claims

arising fiom employer+nrployee relations. The tabor Code provision

prwails. Sectiou 28 of the SEC is declared "null and void."

18

,l

N. JURISDICTION OF THE POEA

Origr"A ard exclusivejurisdiction to hear lnd decide:
a) all cascs, which are. administrative in c haracter, involving or arising out
of violations ofrules and regtrlations reiating to licensing and registration
of recruitment and employment agencies or entities
b) discrplinary action cases aad other spec,al cases, which are administrative
in character, involving employers, principals, contracting partners and
Filipino migrant workers.
.j

O. ILLEGAL RECRUITMENT VS. ESTAF'A

porson conviotcd for illogal rocruitrnsnt undcr the Labor Codc can be
convicted for estafa if the elements of the crine are present. Tlre elements are:

IIL

l.

the accused defr-auded another by abure of confidence or

2.

deceit;
damage

or prejudice capable of
offended party ofthird person

pec

uniary

fu

means

is caused to

of

the

DEVEI..OPMENT OF WORKERS
APPRENTICES AND LEARNERS

agreement" are modified by il,efinitic,ns in the

TESDA law and
its IRR. "Apprentibeship ag_eement' is not an
employment
contract under the TESDA f,aw (R.,\. No. 7796). See SLL,2012.pp.
80-81.

r.

Under RA 7796, emp[oyers r:an only hire apprentices for

apprenticeable occupations yhich nrrrst be officially ondorsed by a
tripirtite body and approve( for apprenticeship by the TESDA to
19

1'

i'

{i

apprenticeship program is relistered and approved by TESDA.

Centurv Cenning Co.r.r.r'illoo v- CA- IG.R No- 152t94. August

17.20071.

Art.59-60. Requisites for a Valid App*nticeship

l.

Qualifications of apprentice ihe met (ELC, p.4a6)

2. T"be apprcnticc is paid not lSss than 75o/o of the proscribcd minimum
salary
3. Apprenticeship agreement dri&5r executed and siped,
4. Apprenticeship progrrm approved by the Sec. of Labor, thru TESDA,
otherwise, the apprentice shall be deemed as a regular employee
5. Period of apprenticeship should not exceed 6 months
oPrior approval by the DOLE of the proposed apprenticeship program is a
condition sine qua non before an hpprenticeship agreement can be validly .
entered into. Nitto v. NLRC, [G.R No. lt4sl7,September 29,19951
r At the termination of the apprenticeship, the employer is not required to
continue the employment
o Employer may not pay wage if the apprenticeship is
r A requirement for graduation

e
o

Required by the School

Required by the Training Program Curriculum

Art. 75. Contents of Learnership Agreement

1.. Names and addresses of employer and learner

2. Occupation to be leamed

and the duration

of the training period shall not

exceed 3 months

3. Wage of the leamer shall be at least llo/oof the applioable minimum wage
4. Commitnrent to employ the learner, if he so desires, as a regular employee
upon completion of training

20

A learner who has worked during the fi13t two months shall be deemod a regular
employee if training is terminated hy the employer before the end of the
stipulated period tbrough no fault of the lsamer.

2.

B.

l.

'Is an einployer liabte to third persons

harmed by an act of aa
apprentice? See Filamer case, ELC 2012,p.49
3. How does apprenticeship diSar &om leamership? @La 20D,p' 5l)

HANDICAPPED WORKERS

Dofinition of "HANDICAPPED WORKERS-

Art, 78. Handicapped Workers

Those whose earning capacrty is imp4ired by:

Age
Physical deficiency
Mental deficiency
lnjury, disease or illness

There must be a link between the dsficiencv and the work which entitles the
employer to lessen the worker's wagg. If the disability of the person is not in
any way reiated to the work for wffiich he was hired, he should not be so
considered as a handicapped worker.
a Handicapped workers may be hirerJ bs 4pprentices or learners if their handicap
is not such as to effectively impede the performance ofjob operation in the

particular position for which they are hired

F.

Att. 79. When Employable

l. Their employment is necessary

to prevent curtailment of

employment

opportunities
2. Does not create unfair competition in labor costs
3. Does not inpair or lower working standards

2.

Rights of disabled workers

Handioapped Workers May Become Regular Employees
If their handicap is not such as to efiectively impede the performance of
job operations in the panicular occupations for which they were hired.

Bernerdo v. NLRC. tG.R. No. 122917. Jutv 12. 19991

Equal Opportunity for Employment
No disabled person shall be denied access to opportunities for suitable
cmploymcnt. Oualificd disablod cmployces shall be sudcct to samo tcrms and
conditions of employrnent and the same cornpensation, privileges, benefits, fringe
benefits, incentives or allowances as a qualified able-bodied person.

3. Prohibitions

on discrimination against disabled persons

Scc. 32. Discrimination on Employmeai

No entity, whether public or private, shall discriminate against a qualified disabled
person by reason of disability in regard to job application procedures, the hiring,
promotion, or discharge of employees, employee compensation, job raining" and
other terms, conditions, and privileges of emplo5rment.

rs rT LEGAL TO PAY A *PERSON lyrTH DTSABILITY- A WAGE LOWER

THAN THE LEGAL MINIMI-IM? [ depends. Is he a *qualified disabled
employee"? (SLL, p.

96;97)

i'

WHAT IS *SHELTERED EMPLOYMHNT"? (SLL; p. 101 )

ry.

CONDITIONS OR STANDARI)S OF EMPLOYMENT

A. APPLICABILITY: *E.E REL"
22

Existence of E-E Rel

Without empl,oyer-ernployee relationship most of labor

standards and labor relations 1aw don't apply- Dospite this
fundamental sigrrificance, "E-E rel" is not understandable from the

Labor Code but only from court decisions. (See ELC, pp' 56-60)
2. "Tests" of E-E Rel
3. Two kinds of "control" as t$Nt of E-E Rel
4. Evidence ofE-E Rel
5. E-E Rel determined by law, not by contract
6. E-E Rol determined by facts ofeach case
7. E-Enot determined by mode of compensation, whether time-based,
ou@ut-based, or commission/percentage-based

B,

COVERAGE Standards &org Article 82 .through 96 apply to all

employees in all establishments and undertakings, whe$er for profit or
not. But they do not aPply to:

support
5. Dome stic Helpers
6. Peisons in the personal service pf another
7. Workers who are paid by resulp

23

C. WORI( HOURS AND WORK DAYS

1. Normal llours of work

2.

3.

Work hours shall not exceed 8 ilburs. Part+ime work, or a day's

work of less than 8 hours, is not ilrohibited.
Work Day
24-hr period commencing fronl the time an employee regularly starts to
work regardless of whetler the tiork is broken or continuous.
Celendar Day
24-hr period commcncing 12 mlttnight and ending at l2:59p.m.

4. Principles in Determining Hours Worked

a) Ali hours are hours worked which the employee is required to give his
ernployer, regardldss of whether or not such hours are spent in
b)

c)

productive labor or involve f,nysical or mental exertion.

An employee, need not ban& the premisos of the workplace in order
that his rost period shall not 6e couated, it being enorrgh that he stops
working, may rest completely and may leave his workplace.
If the work perforrned was necbssary or it benefited the employer, or
the employee could not abandon his work'at the end of his norrnal
working hours because he has no roplacemant, all time spent or zuch
work shall be considered ad hours worked, if the work was with the
Lnowledge of his employer dr irnmediate supervisor-

d) Th" time during which an employee is ioaotive by reason of

intemrptions in his work beyond his control shall be considered
working time either if
( I ) The imminence of the resumption of work requires the
unployee's presence at the place ofwork; or
(2)If the interval is too bilef to be utilized effectively and gainfullV
in the employee'$ owri interest.

Considercd as Compensable Hours worked

(l)All time during which an employee required to be on duty or to be at the
cmploycr's premiscs or to bc at a prescribcd woT k placc; and
(2)All time during which an employed suffered or permitted to work.

(3)Rest periods of short duration durhg working hours. Philippine Airlincs,

Inc., v. NLRC, [G.R, No. 132t05, Februera 2,lg99l

5. Overtime Work (OT)

Work exceeding eighr hours within the_worker
the cmployee.'s shift is not ovcrtime.

r
o

24-hour workday, Wcrk within

OT on a Regular Day: regular wage plus at least 257o thereof

OT on a Holiday/Employee's R.ost Day: rate of ls B hours on holidayirest
day plus at least 307o thereot

Since the OT work is considered hourly. the pay rate is computed also on
per hour basis. The daily wage is divided by 8 to get the hourly base rate.

If

employee is paid on a monthly salaq,basis,'the daily rate is obtained

by the following formula:
Daily rate monthly salarv x,_J!

Total number ofdays considerod paid in a year

o
,

Permissible for the employer tp stipulnte that the employee's monthly

salary constitutes payment for 6t *e days of the month, including rest
days and holidays, where the ernployee';i monttrIy salary, when converted
by the increased divisor into its dai y equivalent, would still meet

.i

5. Compulsory OT lVork (provfded ernployee is paid the odditionel

a)

b)

rs necessary to

c)

serious loss or

25

d) ![ecessary to Prevont loss bf life/property or imrninent danger to

public safety
to prcvcnt l,oss or liamagc to perishable goods
lecessary to avail of favourilble weather o( environmental condition

c) [cccssary

f)

7. Undcrtime NOT offsct by OT

An employee's regular pay rate iii lower than the OT rate. Otrsgtting tne
undertime houn against the OT hoirrs will result in unduc dcprivation of the
employee's extra pay for OT work.

8. Weiver of overtime pay

fught to OT pay cannot be waived. But when the alleged waivef of OT pay
is in considoration of bsnefits and friviloges, which may evcn oxceod the OT
pay, the *aiver may be pen'nitted.
,

9. Compressed Work week (C\illV)l I)epartment Ordcr No. 2l-90' aho

IX)LE Advisory No. 2-09 and No.02-04

r
e
r

Instead of working 6 days a.week, the employees will be regularly

working for less than 6 days bqt each workday exceeds 8 hours. For the
hours exceeding 8 in a workday, the employces waivc their overtime pay
because, in return, they will save on transport and otlier expenses.
.CWW is an example of valid waiver of OT pay
Resorted to by the employer to Prevent serious losses due to causes
beyond his control, such as rvheo there is substantial slump in demand for
his goods and services or when there is lack ofraw materials.
Allowed on condition ftat it is &eely ageed upon between tho employer
and majority of the employees. The arratrgenent should not diminish the
employee's monthly or daily pay or theii established employment
benefits.

26

.
r

Extended workday in CW\Y should not exceed 12 hours. Work

exceeding 12 hours in a day ot 48 hours in a week should be considered
oT.
Should the work shift revert to h ho**, the reversion shall not consiitute
a diminution of benefits.

Conditions for inrplernentation of di" CWW (Deparhnent Order No. 2l -90)

a. The employees roluatatily u$'"" to work nine (9) hours a day from

equal to, the one-hour overtime pay that is due them during weekdays
. .The
based on the employees' quali{ica*ion.
one-hour overtinre, pay d,f ,the 'emplciyees will become due and
d.
demandable if ever they are pelmitted or made to work on any Saturday
during the effectivity of new working time arrangement.
c. The work of thc crnptoyee docs not invotvc strcnuous physical cxertion
and they are provided with adequate rest periods or coffee breaks in the
morning and afternoon.
f. The effectivity of the proposed working time arrangement should be of

tmporzry duration as deteniiined

by the.Secretary of Labor and

Employment.

10. Meal Break

Geaeral Rule: Meal break of no! less than
is non-compensable

hour time-off for regular meals

EXCEPTIONS: rneal period (of not less than 20 minutes is compensable in

the following cases:
1. Where the work is non-manual work .in nature or does. not involve
strenuous physical exertion

2.

Where the establishment regulahy operates not less than 16 hours a day
27

J. In case of achral or impending emergencies or there is urgent work to be

performed on machineries, equipment or installations to avoid serious

loss which thc employcr would otherwiso suffer
4. Where the work is necessary to prevent serious loss ofperishable goods
The 8 work hours do not include meal break. PAL v. NLRC. IG.R No.
t'
132E05. Februarv L 19991
To shorten meal time to less than 20 minutes is not allowed. If the so-called
"meal time" is less than 20 minutes, it becomes only a rest period which is
compcnsablc.
The ernployer may change the meal break from 30 minutes fulty paid to 60
minutes without pay. Since the employees are no longer required to work

during this l-hour lunch break, there is no more need for them to be
compensated for this period. Sime Darby Pilioines v. NLRC.IG.R No.
119205.

Anril

15. 19981.

11. Rest Periods or coffee bre{k running

considered compensable wor\lng time.

from 5 to 20 minutes

is

If standby is for emergency worlq meal break is part of hours worked.

Pan-Americen lVorld Airways System (Philionines v. Pan-Americsn

12. Idle time, waiting time, comtrputing time, travel time, whether
of hours ofwork or not

part

ldlc Time
Whether waiting time constitutrgs working time depends upon the
circumstances of each particular gpse. Thc facts may show that omployee
was engaged to wait or may shpw that he waited to be engaged. The
controlling factor is whether wa[ing time spent in idleness is so spent
28

,t,
s-

l.
2.

Waiting is an integral paH of his work or

The employee is required or engaged by the employer to wait.
:

::

,1.

Working while on call - Aii employee who is requirod to remain on

call in the emolovor's ,."rrili". or so close thereto that he bannot use
the time
una gui;ftrlty for his own purpose is considered
"ff""tiu"ty
working and should trc paid.
r

,
'

'

13. Night Shift Differential (NSD):

Every employee shall be paid a ni$ht,shift differential of not less than l0%
of his regiirlar wage fcn faclttbtir i{i wo* peifornred:baween ten o'clock in
the evening and six o'clock in the rnoming.

'

than 5 workers.
Domestic helpers and persons in the personal service of another
Mmagerial ernployees
Field personnel and other employees whose tirne and,pbrformance ia

b.
c.
d.

unsupervised by the employer including tlrose who are engaged on task

or contract basis, purely comml$sion basis, or those who are paid a fixed
amount of performing work i$espective of the time consumed in the
performance thercof.

14. Night Workers (RA. No.

l0i5l, June 20,2flll)-

See ELC, pp.

l3l

133;511-514
15. Holidays

a)Right to Holiday Pey

Coverage

GENERAL RULE: Applies to ALL employoes. Regular wage plus 100% of

such wago if the worker is required to work on a regular holiday. See
EXCEPTIONS below.

legislhted benefit enacted as part of the

Constitutional irnperative tftat the State shall afford protection to
labor. Its purposc is not merely "to prcvent diminution of the monthly
In other
. income of the workers on account of work intemrptions-

Holiday pay

is a

words, although the worker is forced to take a rest, he earns what he

should earn, that is, his holiday pay." RFM corooretion v. Krs*oien"
G.R No. 16N24. Februdl4'2009
There is no provision of law requiring any errployer to make such
adjusfinents in the monthly salary rate set by him to take account of
legal holidays falling on Sundays in a given year, or, contrary to the
legal provisions bearing on the point, otherwise to reckoa a yeat at
more than 365 days. As earlier'mentioned, what the law requires of
*the monthly
employers opting to pay by the month is to assure that
minimum wage shall not b0 less than the statutory minimum wage
multiplied by 365 days divided by twelve." And to pay that salary "for
all days in the month whether worked or not', and "irrespective of the
number of working days thoroin." Wellincton v- Traiano.,[G.R. No.
114698. Julv 3. 19951

30

b) f,xclusions from coverage|.Not entitled to holiday pay

(l)Employees of the goveriiment and any of the politicat subdivision,
including governmcnt-ofiryred at d controlled corporation
establishments regularly
(2) ernployees of retail
.and service
employing less than ten (10) workers
(3) Domestic helpers and pdtsons in the personal service of another
(4) Managerial empioyees .
(5)Field personnel and othSt ernployees whose time and perforrnance
is rmsupbrvised tiy the ilnployer including those who are engaged
on task or contract basi$, purely commission basis, or those who

are paid a fixed amount for performing work irrespective of the

'time consumed in the petformance thereof.

Monthly-paid vs. Daily-Paid

To convert monthly to daily: Monthly salaty x 12/365
c.

Divisors:

i',

In Union of Filioino Emoldvees v. Vivar. Jr. IG.G. No.79255.29

Jrnurrv 19921 the Court held that "[t]he divisor assumes an
important role in determining whether.or not holiday pay is
already included in the rnonthly paid employee's salary and in the
computation of his daily ratb;"
The divisor used in arriving at an employee's daily ratc for the
purpose of computing salary-related benefits is 261. From the 365
days in a year, we deduct 104 rest days which gives a total of26l
days. Now, if 26 I days is the number of working days of the
employees then, thore is a disputable piesumption that the employee
are paid &eir holi<Iay pay. Ploduceils Bank v. NI-RC [G.R- No.
100701. Msrch

28J0Otl

251 working days divisor is the result of subfiacting all Saturdays'

Sundays and the ten ( l0) leg;al holidays from tho total number of
31

calendar days in a year.

If *rI bmployees

working days, the divisor sUdUa

d. In

Ue

are already paid for all non-

365 and not 25 l -

case of absences

o Employee on leave of abson6$ with pay - entitled to the holiday pay

o Employee on leave of absetlbe without pay on the day immediatoly

preceding a regular holiday - may not be paid the required holiday

pay ifhe has not worked on dtrqh regular holiday
If the day immediately preceding a holiday is a noo-working day in
the establishment, or is the scheduled rest day of the employee entitled to holiday pay only if the employee worked on the day
immediately preceding the non-working daylscheduled rest day

Regular holidays falling within this pcriod are cornpensablc (i.c.

yearly inventory, repdir or cleaning of machineries or equipmen!
etc.).

However, in the case of a re$trlar holiday dwing the cessation of

operations due to busiqess reverses as authori/ed by the Sec. oft^abor,
tlie employer may not pay the regular holidays during this period.
In cases of periodic and temporary closures, the Omnibus Rules
Implementing the Labor Code Book 3 Rule IV Section 7 provides that
in casos oftcrnporary or poriodic shutdown and temporary cessation
of work of an establi.shment, as when a yearly inventory or whetr the
repair of cleaning machines and equipment is undertaken, the regular
holidays falling within the period shall be compensated'

32

f. Of teachern piece workers,

$Safarers, seasonal workers, etc.

l. Private School teache.. irclLdiog faculty members of colleges and

universities may not be paid tor the regular holidays during
semestral vacatibns. But thej are paid for the'regular holidays during

Christnas

vacation.

holiday pay
2. Employee paid by results ([ayment on piece-work)
shall not be less than his av[iage daity eamings for the last 7 act:ual
working days preceding the iegrrlar holi-day; Provided, however, that
in no case shall the holiday ilay be less than the applicable statutory
minimum wage rate.
3. Seaferers - any hout's of work or duty including hours of watch
keeping perfbrmed orr desigrrated rest days and holidays shall be paid
4.

Workers without re.gular working deys - enEUod to the benefits,

under item d, Sectiorr 8, RuE IV of the Omnibus'Rules Implementing
thc Labor Codc.

g. Double boliday (two legal holidays on same day)

o If unworked - employee entitled to200o/o of basic wage, provided
'

he

was present or on leave with pay on the preceding work day

r If worked -

to 300% of the basic wage. Only an

employeo *ho works on the day immediately preceding"or after a
regular holiday shal I be entitled to the holiday pay. A paid legal

employee. entitled

holiday occurring during the scheduled vaoation leave will result in

holiday payment in addition to normal vacatiiSn pay but will not
entitle the employee to another vacation leave. Asiih Trlnsmission
v. CA. IGR No., 144664, March 15.20041

h. Holiday-Sunday
A legal holiday falling on a Sunday creates no legal obligation for

the

employer to pay extra, aside from the usual holiday pay, to its rnorithly-paid
employees.

33

i.

Successive Regular Holidays '

Where there are 2 successive regul& hohdays, like Holy Thursday and Good
Friday, an omployec may not b" p{l-d for both holidays if he absents himself
from work on the day immediatdiy preceding the first holiday, rmless he
works on dre first holiday, in whicit case he is entitled to his holiday pay on
the seiond holiday.

To be entitled to 2 successiv$ holidays, employee must:

(l) Be present on the immedlately precerling the 1$ holiday; or
(2) Be on loave with pay

j.

Muslim Holidays
General Rule: Muslim holidays are observed only in specified
Muslim areas.
Exceotion: Eidul Fitr and Eidul adha (This is celebrated nationwide)
Muslim employees working outside of the specified areas shall be excused
from reporting for work during the observance of the Muslim holidays as
recopized by law, without diminution of salary or vvagos during thc period'

o Considering that all private

offices, agencies, and entities or

establishments operation within the designated Muslim provinces and cities
are reguired to observe Muslim holidays, both Mustims and Christian
working within the Muslim arets msy not report for work on the days
dcsigneted by law as Muslim Holidays. SMC v. CA. IGR No. 14675.
Januarv 30.20021

D.

SERVICE CTL{RGES

Art. 95 Service Charges - applics only to

ostablishments collcoting scrvioc

charges such as hotels, restaurants, lodging houses, night clubs, cocktail
lo mge, rnassage clinics, bars, casinos and gambling houses, and similar
34

enterprises, inctuding those

subsidiaries of the Go'i'ernnret t.

"ntfuies

Tips

',

Tip is not normally. Part ot

it

being gven bY customer. Service

cost of the'food, goods, ot services

35

i'

H,. EMPLOYMENT STAXNIHOS: WAGES

l.

Definition
'Wage- paid to any employees shiitl mean the:

a) Remrmeration or eamings, ho*ete, desipated, capable of being

expressed in terms of money, Whether fixed or ascertained on a time,
task, picce, or commission bdsis, or othcr mcthod of calculating the
same, which is payable by an iimployer to an employee under a writter

b)

or rmwritten contact 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 deterrnined by the DOLE Secretary, of
board, lodging, or other facilities customarily furnished by the employer
to the employee. "Fair and reasonable value" shall not include any profit
to thc cmployor, or to any por$bn affiliatcd with the cmployer.

Minimum wage is set by law

; order issued by the Regional Tripartite
",
Wages and Productivity Boards (RTWPB's) ot the rate which may be fixed by
the eryloyer provided the same is not lower than the legally mandated
minimum wage for agriculturdl or non-agricultural workers,

Art

124.

StrnderdslCriteria for minimum wagc fixing

The regional minimum wages to be established by the Regional Board shall be

as near$ adequate as is economically feasible to maintain the minimum
standards ofliving necessary for the health, efficiency and general well-being of
the employees within the framework of the national economic and social
development prograrn.
In thc determination of suoh regional rriinimum wages, the Regional Board shall,
among other relevant factors, consider the f'ollowing:
l. The demand for living wages;
2. Wage adjustnent vis-d-vis the consumer price index
3. The cost of living and changes or increasos therein
4. The needs of workers and their families

5.

6.
7.
8.

Wages v. Salaries
Th" *ug" aad salary are sy:onlmotrs has been settled in Songco v. NLRC.
Thcrc is no differcnoc botwggn thom. cxcept somantics. 4opitaFle Fanking

Equal Pey for Dqual

Work

qualifications, skill, effort and

Persons *ho *o.k with sut,stantiaily
'
"q.rat
responsibility, rrnder similar c,xditiofts, should bo paid similar salaries.
Wages include value of *lbcilitiesl
Facilities v. Supplements
Check SIP. Food House v. B$olina.IG.R. No. 1.92473. Oct. ?0101.

2.

Facilities
Articles or services for the berrefit of tlre employee or his family but shall not
includc tools ofthe trade or articles or service primarily for the benefit of the
employer or necessary to the (onduct of the employers busiuess; may be
deducted from the employees u,ages.
Acceptance of Facilities
ln order that the cost of facilities furnished by the employer may be charged
against an employee, the employee's acceptance of such facilities MUST BE

VOLUNTARY

37

3. "Facilities' distinguished from olirpplements'

Supplcments
.an
'llhe benefit "or privilege given to tt[ employee, which constitutes
extra
remtmeration over and above his basic or ordinary earning or wage, is
supplement. Thus, free meals surpplidt Uv the ship operator to crew members,
out of necessity, cannot be considereJ.as facilities but supplements which could
not be reduced having been given not is part ofwages but as a necessary matter
in the maintenance of the health and ifficiency of the crew personnel during the
v

oyagE.

a) Requirements for deducting value of facilities

(l)

Proof must be shown that such facilities are customarily furnished

by the trade
(2) The provision of deductible facilities must be vohmtarily
accepted in writing by thb employee
(3) The facilities must be chirged at fair and reasonablc value:

4. Coverege/exclusion
'l"he rule on minimum wages applies to all workers.

SLL Intcrnationd Cebles-

tG.R. No. 17216l. Merch 2.20111.

a. Farm teflancy/leasehold
b. Domestic service
c. Persons working in thet

d.

'

respective homes in needle work or in any cottage

industly duly registered in accordance with the law
Barangay micro business enterprise (BMBE) under RA 917i, tlre BMBE
Law. BMBE - any business entiry or enterprise engaged in the production,
processing , or manufachrrilg of products or comhodities, including agroprocessing, trading and services, whose total assets including those arising

fiom loans but cxclusivo of the land on which the particulr business eotity's
office, plant and equipment are situated, shall not be more than P3M'
e. A cooperative may apply for. and be granted exemption from minimum
wage law.

Retail or service establishments tegularly employing not more than l0

workers may apply for exemption &iththe RTWPB.

5. Minimum

wage compliance witfibut diminution of benefits; the

diminution rule" (Article 100)

nor-

Code shall be construed to elirhinate

or in any way diminish supplernents, br other employee benefits being enjoyed
at thc timc of promulgation of thii Labor Code. Bencfits bcing givcn to
employees shall not be taken back br reduced rmilaterally by the employer

GEMRAL RULE: Nothing in the Ldbor

because the benefit has become part

of the employment contract, written or

unwrrtten.

Diminution of benefits is the unilateral withdrawal by the employer of benefits

already enjoyed by the employees,
;

Tbere is prohibition against diminutidrt of benefits when:

l.

The grant or bensfrt is founded on a policy or.has riponed into a practico

2. The practice is consistent anrl deliberate

3. The practice is not due to error in lhe construction or application of a
doubtfirl or difficult question of la*, and
4. The diminution or discontinuance is done unilaterally by the employer.
TSPIC v. TSPIC Emnlovee Union. IG.R No. i63419. Februerv 13.
200Et.

EXCEPTIONS:
a) not established practice
b) negotiated benefits
c) diminution voiunteered try employees
d) benefits on reimbursement basis
e) reclassification of position
f) cootingent benefit, e.g. bonus
39

r
g) To correct an error, otherwise, if the error is left uncorrected for
a reasooable period of ti-", it ripens into a company policy and
ornployeos oan dcmaJ0 for it as a mattd of right'

certain prebonus is contingent or conditional; its demaqdability depends on

conditions.

t\

It is an amount granted ,ol,rntalily to an employee for his/her industry

of
and loyalty, which contributed [O the success arid realization ofprofits
the employer's business.
It is not a demandable and enfoiceable obligation mless it was promised
case
to be given without any conditions imposed for its payment in which
it is docmcd part of thc wage.
r.

6- Minimum wsge; how errned by Smployees peid by result (Art' l0l);

6.

Other entitlements of emplo.vd|s paid by result Maketi Heberdeshery

ruling modified in La}gf Consress case. (See ELC, p' 86-87)

7. Form, time, and placc of pe5meot of wages

Art. 102 Forms of payment
,,i

SULE: No employer sh$l pay the wages of an employee by any

other means other than legal tender, even when expressly requested by the

@EB{L
ernployce.

allowed
IIXQEPIIO\L Payment of wages by check or money or&r shall be
whcn such mSDner of payment is customary on *re date of effectivity of this
code, or is necessary because of special ciraumstances as specified in
ippropriate regulations to be issued bl/ the secretary, or as stipulated in a cBA.

Payment by check
Payment
where

of wages by bank checks, postal checks or money orders is allowed

l.

such manner of wage payment is

the tabor Code,

2.
3.

where it is so stipulated in a collootlve agreement, or

where all of the following conrliti<*rs are mef:

a. There is a bank or other facillty for

on the date of the effectivity

encashment within a radius

of

of

kilometer from the workplace

b. The employer or any of his agdltts or representatives does not receive any
pecuniary benefit diri:ctly or in{irectly from the arangemett
c. The employees are given refisonable time during banking hours to
withdraw their wagcs fiom the bank which time shall bc considered as
compenSable hours worked ifdone during working hours
d. The payment by check is with the written consent of the employees
concerned if there is no collective agreement authorizing the payment of
wages by bank checks
21. Necessary because of sp+cial citcumstances as specified
in appropriate
regulations issued by the Secretary of Labor

,trt.

103. Time of payment.

GENERAL RULEIAI least once every 2,weeks or twice a month at intervals
rrot exceeding 16 days:

If

on account of fotbe majeure or circumstances beyond the

employer's control, payment of wages on or within the time herein provided
E--XCEPTION.

cannot be made, the employer shall pay the wages immediately after such force
rnajeure or circumstanceg have ceased.

IN ALL CASES: No employer shall rnake payment with less frequency than
once a month.

Conditions for payment of .wages pf employees engaged to perform a task

which cannot be completed in 2 weei<s (ifno CBA or Arbitration ewaril):
(l)That pa)rments are made at intervals not exceeding 16 days, in proportion to
the amount of work completed;
Q)n.ert final settlement is made upon completion ofthe work.

4t

Art

104. Place of paymeut

qENERAL RULE: Payment of wages shall be rnade at or rear the place of

undertaking.

EXCEPTIONS: Pa5mrent

p"r-tr-tbt" only

2.
3.

in a place other than the work place shall be

under the following circumstances

When paymcnt cannot be affectpdut or flear the place of work by reason of

the deterioration of peace a1d order conditions, or by reason of actual or
impending emergencies caused by fire, flood, epidernic or other calamity
rendering payment thereat impossible.
When the employer provides free fiansportation to the employees bacl' and

forth.
Under ary other analogous circumstances; Provided, That the time sperrt by
shall be considered as comperusable
the employees in collecting their
hours worked

Prohibited Place of Payment

Bar, nigbt or day club, drinking establishment, massage clinic, dance hall, or
othcr similar plaocs or in places whelp games aro playcd with stakcs of moncy
of persons employod in said
or things representing mony excep('tltt tlr"
places.

""t"

Art.

105. Direct payment of wages.

GENERAL RULE: Wages shall be paid directly to the workers to whom they
are due.

EXCEPTIONS:
I. Payment through another person (a)In cases of force majeure rendering such pa5rment impossible or tmder other
special circumstances to be deteqiiined by the Secretary - the worker may
be paid through another person tu1$er written authority grven by the w,rlker
for the purposc; or
(b)When authorized under 6xisting lay, including:
i. Payments for the insurance preqiums of the employee
42

2.

Payment Thni Heirs of Worker

employer may pay the wages of the

Where the worker has died - tlfe
t.
deceased worker to the heirs of dib latter without the necessity of intestate
proceedings.
Procedure:

The claimants, if they are all #age (or in case of a minor, by the nanrral
guardians or next-of-kr.ni, strdlt execrrte an afEdavit attesting to 6eir
relationship to the dect:ased and the fact that they are his heirs" o tb
exclusion of all otlrer persons.
If any of the heirs is a nrinor, tlie affidavit shall be enocrrod u hir bff

rN

*t
-*

heirs.

.
3.

pa)rme of,wages under thiq Article shall

absolve the employer

any frrrther liability with respdi to the amount paid.

The

of

Paynrent through member,rf worker's family

Where the errployer is, aurthorized

lvagos to a msmber of his lirmily.

in writing by the employee to pay his

Lirbility to pty wag6: direct end iridirect employers; Lebor Contrecting

Indirect employmort: La-bor contractitlg vs. Prohibited Labor-only Contracting
(D.O. No. l8-A) (See: ELC, pp. 90-99,172487t
a. Cnteria for legitimate labor contractilg
b. Consequence of labor contracting
. o. Cooperative as a contractor
d. Effoct of registration and non*egrsfation
43

'it

Contract for r Piece of Work (under the Civil Code)

Arrhle 1?t3.
By the contract for a piece of work ttrc contractor binds himself to execute a
piece of work for the employer, in consideration of a certain price of
compensation. Th contractor nray either employ onty his Iabor or skills, also
furnish the material. ( I 588a)

Article 1721.
If, in the execution of the work, an act of the employer is required, and he
incurs in delay or fails to perform the act, the contractor is entitled to a
reasonable compensation

The amount of tle compensation is cpmputed, on the one hand, by the duratioa
of the delay and the amount of the compensation stipulated, and on the other
hand" by what the contraotor has saved in expcnscs by rcason of thc dclay or is
able to earn by a different employment ofhis time and industrf,

Article1724.
The contractor who undertakes to build a structure or my other work for a
stipularcd prico, in conformity with plans and specifications agreed upon with
the land-owner, can neither withdraw from the contract nor domand an increase
in the price on account of the higher cost of labor or materials, save when there
has been a change in the plans and specifications, provided:

(l)Such change has been authorizod py the proprietor in writing; and

(2)The additional prico to be paid to the contractor has been determincd in
writine by both puties. (1593a)

44

BANKRUPTCY

i''

rE
,'{

Workers shall enjoy first preference as, [egards their wages and other monetary
claims, any provisions of law to the conff'ary notwithstanding. Such unpaid wages
-and
monetary claims shall be paid in {ttfl before claims of the governmont and
other creditors may be paid.

A declaration of bankrupt"y or u j{idi"iul liquidation must take place before

the worker's preference may be entorced.

Establishes a preference of credit dhd NOT a lien.

G. ATTORNEY'S FEES

l. In case of unlawful withholdin6 of wages, the culpable party may be

assessed attorncy's fces equivalcflt

to tcn percent of the amount of wages

recovered.

be unlawful for any persoir to demand or accept, in any judicial or

administrative proceedings for the recovery of wages, attomey's fees which
exceed ten percent of the alnount of wages recoveied.

2. tt shall

JURIS.UPDATE: May salary be withhcld because of the employee's "non-

performance"lt

Ordinary Concept

ln

ordinary concept, an attorney's fee is the reasonable eompensation paid to a

lawyer by his client for the legal services he has rendered to the latter. The basis of
this compensation is the fact of his employment by. and his agreernent wift, the
client.
160334. Scotember 11. 20061.
il;s

;'

Extraordinary Concept
In its extraordinary concept, an attomey's fee is an indemnity for damages orderod
by the court to be paid by the losing party in a litigation. The basis of this is any of
the cases provided by law where such .award can be made. This extraordinary
concept of attorney's fee is payable not to the lawyer but to the client, unless they
45

have agreed that the award shall pertain {o the lawyer as additional coinpensation
IBIY
or as paxt thereof. fftzv. San Misuel CorDoration. IG.R

Nos.

llr 20081.

Art.ll2 Non-titerfcrence

in Disposal of Wrges

No employer shall limit or otherwise i6terfere witl the freedom of any employee to
dispose oi hir n ug". and no employe{i shall in any marmer oblige any of his
ooployr"* to patronize any store or avail of &e services offered by any person'

H. WAGE DEDUCTIONS
GENERAL RULE: Not allowed.
EXCEPTIONS:

l.

In cases where the worker is insuped with his consent by the employer, and
the deduction is to recompense thq ernployer for the amount paid by him as

premium
on the insurance
-For
2.
union dues, in cases where the right of the worker or his rmion to checkoff has been recognized by the employer or authorized in writing by the
individual worker concemed.
3. In cases where the employer is agthorized by law or regulations issued by
the DOLE Secretaryi

Other Allowable Deduction (DUMP-LAW-CA1')

l.

cases where employee inDebted to employer, where such indebtedness

has become due and demandable
2. loion dues
J. Deductions for value of ll[eals an( other facilities
4. In court awards, Wages may be dp subject of execution or attachment, but
only for debts incurred for food, sftelter, ciothing, and medical attendanc

In

Medicare, Pag-IBIG lremiulrs

I
6. Deductions for Ltss or damage
5. SSS,

7.

{gency

Fee

8. Salary deductions of a legally established Cooperative

9. Deductions for payment to 3'd pprsons, upon written duthorization of
employee

I0.Withholding

lax

the

Deposits for loss or Damage (Art" I l4)GENERAL RULE: No employer shall ril[uire his worker to make deposits for the
reimbursement of loss o. a'u*"g* to matirial, equipment, or tools supplied by the
i:mployer.

DTCJPTION: When the trade, occupatiiin or business of the employer recognizes

the practice of making dedtlctions or requiring deposits n"""t*ury ot
o.

"-*iaor

desirable.

iI-

4.

I.

WAGE FIXING: I\IWPC AND RTWPB: FUNCTIONS AND POWERS

- ARTICLES 770-173
Wage Distortion: What is

ardwhatis not

Art.124 tYage Distortion '

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 groupC in an establishrnent as to effectively
obliterate the distinctions embodied in such wagE $truohrr. basd Gn,skills, length
of service or other logical basis of tlifferentiation. Simply, if the pay -advantage of a
position over another is removed or significantly reduced by a pay adjustrnent
riquired by a wagc order; such pay advantagc should be restored.

47

For a distortion to exist, the h* does not require dn elimination or total

abrogation of quantitative wage br salary difference; a severe contraction
theteof is cnough.

without
3.

of the

4-

131427. Januerv 25.

country.

I999L

Correction of \ilage Distortion

A. rN CASE OF AN ORGANIZED e$tenltsHueNr
l Erployer and union shall negoti$te to correot the distortion

2.

Any dispote arising should be resolved through grievance procedure under

CBA

3. If dispute

remarns rmresolved, ft16rrgh voluntary arbitration

B. IN CASE OF AN UNORGANIZEil ESTABLISHMENT

l.

The employer and empldyees shall endeavour to correct the distortion

2. Arry dispute shall be sctled through National Conciliation and Mediation

Board(NCMB)

3. If

remains unlesolved after

l0

days of conciliation,

it shall be referred to

the NLRC

Any issue involving wage distcjhioo is not a valid ground for a strike or a
lock out.

l99il.

it8

Amount of Distsrtion Adjustroent

The restoration of the previouri pay
is the aim but not necessarily to
ttre last peso. Restoration of appreciable differential, a signifioant pay gap,
should suffice as correction.
Suggested Formula to Correct a Sadry Distortion

Minimum Wage:
Actual Salary

7o

PrescriliLd Incrcase

Wage distorhon involvt:s comphrison of jobs located in the same region.

Examination of alleged salary distortion is limited to jobs or positions in
the same employer in the same replion; thus, the comparison of salaries

has to be intra-region not inter-region. PrBbeqkerc Association v.

Prudentirl Bank and l-r+st Co.. tG.R. No. 131247. Jenurrv 25. l9!l!)1.

The distortion that should be iectified refers to distortion arising from

compliance with a goverrrment wage order. It'does not refer to distortion
caused by salary revisions voluntarily initiated by the employer unless
such a duty exists becrruse of a CBA stipulation or company practice.

trbbruarv 17.2004t,
Eremptions froir Wage Order
Wage 0rder
An order issued hy the Regr onal Board whenever the conditions in the region
so warrant after studying and investigating all pertinent facts and based m
the standards and criteria pto.scribed by the Labor Code.

wage order adjusts the rninimurn level but not the levels above the
miriimum. It does not mand:rte across the board salary increase.
Employees NOT Coverod
l. Household or domestic helpers. including family drivers ,and workers in
the personal seivice of alrother

2. Workers and employees in retaiVservice establishments regularly

employing not more than l0 w0rkers, when exempted from complience,
for a poriod fixed by thc Commlssion/Boards
3. Workers and employees in ne* business enterprises outside the National
Capital Region and export proc$ssing zones for a period of not more than
two or throe years, as the case lhuy b", from the start of operations when
exempted.

Efrectivity of lYage Orders

Takes effect after 15 days from.,its complete publication in at least one
newspaper of general ctculation in the region.
Public Hearing3 and Consultations Mrndatory
Notice must be given to employees' and employers' groups, provincial, city
and mrmicipal officials and other iltterested parties.
A wage order issued without the required public consultation and newspaper
publication is null and void.

Frequency

A wage order issued by the Board may not be disturbed for a period of 12
months from its effectivity and no petition for wage increase shall be
entertained during said period EXCEPT when Congress itself issues a law
increasing wages.

StrnderdVCritcria for Minimum Wage X'ixing

Must be economically feasible to maintain the minimum standards of living
necessary for the health, efficiencf and general well-being of the employees
within the fiamework of the national economic and social development
program.

Factors to Consider in lVege Determination: [SNAPE CRIf,DI

l. Irnprovements in $tandards of living
2. The Needs of workers and theit families

Note:

Wage Order enforcement and disJiosition of Money Claims

:- nke this up

under Procedural Labor Law

J. WORI( CONDITIONS FOR SPECIAL GROUPS: WOMEN WORIGRS

Unlawful for any employer to disi*iminate against any womirn ernployee

with respect to terms and conditions of employrnent solely on account ofher

against a male employee, for work of equal value

2. Favoring a male employee over.a female employee witlr respect to

promotion, training opporhrnities, study and schoiarship g,tants solely
on accormt of their sexes
r Person guiity of committing these acts are criminally liable
under Arts. 288-289 dfthe Labor Code
o That the institution of any criminal action under this provision
shall not bar the aggrieved employee from filing an entirely
separate qnd distinct action for money claims, which may
include claims for damages aod other affirmative reliefs. The
actions hereby authorized shall proceed independently of each
other.
51

l.

Stiputetion egainst merriage

(Art

136, Lebor Code)

Art

136. Stioulation Asairst Ma

It shall be unlawful for the employor to:
I . require as a condition of empioiment or continuation of employment that
a woman employee shall not get married
2. to stipulate expressly or tacitly that upon getting married, a woman
employee shall be deemed resigied or separated
3. to actuatly dismiss, discharge, discriminate or otherwise prejudice a
woman employee merely by reason of her marriage

A woman worker rnay not be dismissed on the ground of dishonesty

for having written "single" on the space for civil status on the
application sheet, contrary to the fact that she was married. PT&T Co.
G.R. No 11897&,Mev 23.19971.
A requirement that a wotian must remain urunarried could be a
justified as a bona fide dccupational qualification where the particular
requirements of the job would justifu the same but not on the ground of
a general principle, such as the desirability of spreading work in the
workplace. A requirement of that nature would only be valid provided
it reflects an inherent qualitf reasonably necessary for satisfactory job
performance. Star Faper v. Simbol. [G.R No. 164774. Aoril 12.
2m61.

Duncan AssociatioF gf Deteilman-PTGWO and Pedro Tecson v.

Ghxo Wellcome Philiooines. Inc. [G.R. no. 162994. September 19.
2fi)51. passod on the validity of the policy of a pharmaoeutical
compdny prohibiting its employees from marrying employees of any
competitor company" Employer Glaxo has a right to guard its trade
secrets, manufacturing formulas, marketing strategies and other
confidential prograrns and information from competitors. The
prohibition against personal or marital relationships with employees of
competitor companies upon Glaxo's employees was rolsonable rmder
thc circumstanccs because rclationships of that naturc -ight

K.

l.

-t,

A child below 15 years of age is not employable, except:-

,':
, 2. Child below

years sfrai rut o,ort< moic than 4 houry a day or morc

than 20 hours a week rror between 8:00p.p. and 6:00 a.m.
15

J.
:

53

4. No child below l8

can be empioyed in a hazardous or deleterious

work nor in any other "worst fdfln" of child labor which include;
:

4.1 any form of slavery or tradrking of childreo

4.2 prostitution or pornograp\|r
4.3 any illog'al activity such as'haffioking of dangerous drugs

5. No child (anyone below l8)

'

can be employed as model to advertise

intoxicating drinks, tobacco, gpmbling or any forrn of violence or

pornography.

6. By legal definitioo. a person l8 years old or older is not a child and is

firlly employabh in licitl$s.

L. WORK CONDITIONS: HOUSE*EEPERS RA IIo.lllfl (epprovcd

on March 18, 2013) modifics tc pdrtincnt prurdlbnr ir Oc If.

l.

Deftnition
6Houschclper'
Any person, whether male or femali, who renders services in and about thc
employer's home and which servicds are usually necessary or desirable for
the maintenance and enjoyment thereof, and ministers exclusively to the
personal comfort and enjoyment of the employer's family.

.
r

Covers family &ivers, domestic servans. laundry women, yayas,

gardeoers, houseboys, arrd other similar house helps.
CRITERION: the porsonal comfort and enjoyment of the family of
the employer in the home of said employer

2. Bencfits accordcd fo houselel!,erq

Anl

143-153 Rights of Househelpers

54

,i

shall NOT EXCEED 2 years

4. Reliefs for unjust terrninati

tn

.:

renewable

1. If the period for househpld service.is fixed, neither the employer-nor the
of thc term
househclper may tcrminate rhe corlhact bcforc thc expiratioh
,
except tbr

.., j,

Just cause.
55

f5':
2.
3.

the househelper is unjustly dislrrissed, he or she shall be paid the

compensation already eamed + that ibr l5 days by way of indemnity
If the housohelper leaves without jtlstiliable foasoo, hc or shc shall forfeit

If

any rurpaid salary due him/her not ex6eeding 15 days.

M. EMPLOYMENT OF HOMEWORKORS

l.

Defmition
HoMEWORKER applies to any person who performs industrial homework for
an employer, contractor or sub-contractor.

What is Industrial Homework?

Injustrial Homework is a system of production under which work for an
r-ptoy"t or contraotor is carried out try a homcworkcr at his/hcr homc'
Materials may or may not be furnished by &e employer or oontractor. It
differs from regular factory producdon principally in that is a decentralized

fonn of production where there llr ordinarily very little supervision or

regulation or methods of work. (Sec. 2(a) DO 0S92)

Empl,oyer of Homeworker
Includes any person, natural or artificial, who, for his acoount or benefit, or
on bchalf of any pcrson rcsiding or;tside thc cormtr5r, diroctly or indircctly,
or through an employee, agent contractor, sub-contractor or any other
person:

a. Delivers, or causes to be delivered, any goods, articles or materials to be

b.

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
Sells atry goods, articles or materials to be processed or fab'ricaed in or

about a homc and then ro-buys them aftcr suoh processin! or fabrication,
either by himself or through some other person

2. Rights and benefits rccorded hormeworkers

Immcdiatcly upon rcccip of the finished goods or articlcs, thc employer
shall pay the homeworker of the contractor or subcontractor, as the case nray
55

be, for, the work performed l6ss corf6sponding homeworker's share of SSS,
MEDICARE and ECC premium contiibutions whiqh shall be remittetl by the
contractor/subcontractor or cmployct to the SSS with the cmploycr's sharc.
. However, where payment is madd to a contractor or subcontractor, the
homeworker shall likewise be paid lmmediately after the goods or articles
have been collected from the workerli. (Sec. 6, DO No. 5)

Prohibitions for Homework

1.. Explosives, fireworks and articles of like ghgaoter

2. Drugs and poisons

3. Othr articles, the processing of which

requires exposure

to

toxrc

substance

N.

LEAVES
1. Servicc Inccntivc Lervc (SlL) Pav .
Evcry emploiee who has rcndercd at leiist I year of scrvice shall be entitlcd to a
(Art. 9s)
yedy service incentivc lpave of

o
o

Commutable to its money equivalent if not used or exhausted at the end of

the year.
The basis for the computafiorr is Ae $alary at the date of commutation of the

sIL.

{At least I yeer newhe"

Service for not less than 12 months, whether continuous or broken reckoned
fiom the date tho cnqrloyee started working. lt includes authorized absences and
paid regular holidays unless the wmking days in the establishment as a matter
of practice or policy, or that provided ln the employment confi?ct, is less than
12 months, in which case said period shall be considered as one year.
Exclusions from coverage
l Those of the Qovemment and ant of its political subdivisions, including
govemment-owned' and controlled corporations
2. Bomestic helpers and persofls in the personal service of another
57

3. Manage rial employees

4. [ieltl personal and other employees

whose performance is unsupervised by

the employer including those who are engagod on task or contract basis,

purely commission basis, or those who are paid a fixed amount lbr
performing work irrespectil-e of the time consumed in the per.formance
thereof.
Those who are already lnjoying the lienefit herein provided
Those enjoying vacation f,eave with pay ofat least five days

5.
6.
7. Those employed

in

establishments regularly employing less than

len

onployoos

2. Meternity Legve
a. Coverage
SSS Law (R.{. ll5l.

as emended

bv RA E2E2)

trr-ffiffiGr-tas

paid at least

monthly
contributions in the l2-month period immediately preceding the semester of her
childbirtVmiscarriage shall bo paid a daily maternity benefit equivalent to
100% of her average daily salary credit for 6C days (in case of normal delivery)
or 78 days (in case of caesarean delivery).

female member

b. Conditions to entitlement (NAB-4-Rll)

L
2.
3.

4.
5.

Employee shall have Notified her ernployer of her preguancy and the
probable date of her childbirth, which notice shall be transmitted to the SSS.
Full payment shall bc ldvancod by the ernployer within 30 days from tho
filing of the maternity leave.
Pa5zment of daily matemity benefiLs shall be a lar to the recovery of
sickness benefits provided by the S$S Law for the same period for which
daily maternity benefits have been rgpeived.
The maternity benefits provided unqfl tt ir Section shall be paid only for the
fu st ! deliverieVmiscarriages.
Thc SSS shall immcdiatcly lcimburqc thc cmployer of l00o/o of thc arnorunt
of maternity benefits advanced to thg employee by an employer upon recerpt
of satisfactory proof of such payment and legality thereof;
58

6.

Every pregnant woman

in thd private

sector, whether married or

c. Availment
Thc maternity bcnefits .provided urder this section shall bc paid ouly for the
tust four (4) deliveries or miscarriages. [Sec. l4-A(d), RA 8232]
'.,1.

3. Paternitv Lcave
e. Coverage
PltemitY Ifave Act (R-A1 8I87)
Paternity leave is available only for the first 4 deliveries of the legitimate
spouse with whorn tlre husbarrd is,lohabiting. This law contomplates the
time and,allowance required by employed fathers. The,leave is 7 calendar
days, not *.ork days.

b, C.oaditions to entitlemgnl
1. A mar,ried male omployeq

2.

at 0rc time of delivery of his child;

Cohabiting with his lawfirl spoudb at the time she gives birth or suffers a

misc4rriage;

3. Applied for patcrnity

leave within a reasonable period from the expected

date of delivery by the pregnant spouse, or within such period as may be
provided by company rules or by CBA; provided that prior application is

4.

not required in case of miscarriage;

Wife has given birth or sufl'ered ii miscarriage.
59

In the event that the paternity leave benefit is not availed of, said leare
shall not be convertible to cash (Sec. 3 IRR. ofRA 8187)
Where a male employee is already enjoying the paternity leave betefits by
reason of contractJ company policy or CBA, the greater benefit prevails.

c. Availment
The male employee applying for paemity le.ave shall noti.fu his enrployer
the prepancy of his legitimare spouse and the expe cted date of such delivery.

of

5. Pflrental(Solo Perent) Lcave

a" Coveraqe: Soto Parenl
Act of 20fi))

f,EEyo

Who are considered Solo Parents

of parenthood because of:

t.

death ofone's spou$e.

iRA

a paxent

8!172: Solo Parent's

Wclfere

lelt alone with the responsibiliq'

,,i

2. aoy physical and/or

3.
4.
5.
6.

mental incagpcity oione's spouse.as certified by a

public medical practitioner.
one has legally separatod from his spouse or because they have be,e,n
separated for at least one year and the chitd is in sokr parent's custod5r.

the nrarriage was annulled by a court or l ohrirch decree, and the childl is
in sole patent's custody.
the spouse abarrdoned him/her fotr at leasl one year.
the other sporrse is detained or is'pervirg sefltence lbr a crime for at least
one ycar.

7. Also coirsidered a solo parent: qp unmarried mother or father who

8.

hds

preferred to keep and rear the chfld himself, instead ofhaving others care
for them or give up to a welfare ipstitution.
Sole provider of parental care an$ support to a child or children-

50

9.

Assumes responsibility of head tlf the family as a result of the death,

abandonment, disappearance or prolonged absence of the children's
parcnts or solo
..
l0.A victim ofrape and/or other criiiies against chastily, have given birth to
a child as a result and have decid&d to keep and raise his chil&[Sec. 3(e),

pareht.

RA 19721

b. Conditions to Entitlerngu!

l.
2.
3,

He/she has rendered at least I lear of service, whether continuous or

broken;
Helshe kis notified his/her employer of tho availrnent thereof within a
reasonable period;
He/she has presanted a Solo Parent ldentification Card by hiVher
employer (Sec. 19 IRR. oi'RA 5972).
,

c. Aveilfreirt
"t

.'.

A parontal leave of not m,re than 7 working days eyery yoar shatl bc
granted

to any solo parent employee who has rendered at least I year's

servlce.

NOTE: Unused parental leirvs is dbt convertible to cash rmless otherwise

provided by the CBA [Sec. 20" IRR bfRA 8972]

6. Ifgves for victims of violencd,asai+st rvomco

a. goveI4ggi'
Bgttercd Women Le;rae undcr RA 9262 (Anti-Violencc Asainst
\tomen and their Children Act of,2ffi4)

Allows the victim ol' violerice, which may be physical, sexual, or

psychological, to app.y tbr the issuanco ofa protection order. Ifsuch
victim is at employer,, she is ontitled to a paid lcave of up to l0 days
in addition to other ptid leaves under the Labor Code, other laws and
company policies.

61

b. Con3itiops to Entitlcmcnt
l. The ernployee has to submit a certiflcation from tho Punong Baraagay
. or Kagawad or prosccutor or Clerk of Court that an action rmdcr RA
9262bas been filed and is pending.
2' The use of the 10{ay leave is at the option of the employee.
3. It shall be used for the days that she needs to attend to medical and
legal concems.
i
4. Leaves not availed of are non-gumutative and not convertible to cash.

c.@!
Leave up to ten days in addition to other paid leaves under the Labor Code,
or other laws. [Sec. 43, RA 92621

7. Soccial Lceve bencfits for women undlr RA 9710 (Mama Crrtr for
Women)

A woman employee having rendered

continuous aggregate employnrent

service of at least 6 months for tlp last 12 months shall.b entitled tu a
spccial lcave bcncfit of 2 mon&s afe ftfl pay bascd on hor gross monthly
compensation followinc surger-v caused by gmecological disorder.

v.

EMPLOYEES COMPENSATION
COMPENSABILITY

COVERAGE AND

Coverage:
a Every employer
b. Evcry cmployco not ovcr 60 ycars pld
c. Any employee over 60 years bfagg ifhe has been paying contributions prior
to age 60 add has not been compulqpry retirod.
An enrployee who is coverable Uy (ptn tno GSIS and SSS shall be
compulsorily covered by both systerrs.

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Grounds for compensability

a. For the injury and the resulting disadliitv or deattr to be compensable, the
injury must be the result of accidgnt ilrising out of and in thc coursc of
employment
b. For the sickness and the resultinq diilbiliry or death to be compensabie, the
sickness must be the result ofan occ$pational disease listed under the
Annex of the IR dealing with occupdtional diseases with the conditions set
therein satisfied. Otherwise, proof rdirst be shown that the risk of contracting
the disease is increased by the workiiig condifions.

vr. sExuAL HARASSMENT (RA. NO. 7877)

l.
2.

In a work-relatod environmort, what acts constitute sexual harassmcnt?

Two statutory duties of employer to deter Sexual Harassment.
(See SLL pp.201-201)

VII. SOCIAL SECURITY

L,IW

.ruruS.UpneTD; If the NLRC in an illegal dismissal case found that tho

complainant was not an elnployee, does this finding bind the SSS, or may
the SSS conduct its own inquiry so d$ to enforce the SSS law?

JURIS.UPDATE: Does the SSS have the authority to compel

a cooperative

to registeJ its alleged "coop members" as "coop employees"?

JURIS.UPDATE: Assume that Employee A, an SSS member, retired on

July l, 2011. In August of that year he married Josefa his commor-law wife
in a civil ceremony. One rnonth thereafter, he died. Would &e wife be
entitled to receive the death benefit hom SSS?

JURIS.UPDATE : Section l3-A of the SSS law states that complete loss of
sight of both eyes is permanent total disabiliry. If loss of sight is of only one
sye, may the disability be considered also as permanent total?

l.

Covemse:
A. Compulsory

(I)EMPLOYER - aoy persotr, natural or judicial, domestic or foreign who

carries on in the Philippines any trade, business, industry undertaking or
activrty of any kind and uses the services of anoth,er person who is qnder his
order as regards employment

(2)EMPLOYEE - any person who perforrns services for an enrployer who

receives compensation for such services where tbere is an employercmployee rclationship; not over 60 yoars ofage
Compulsory coverage of the employer shall take effect on the first day of his
business operation and that of the employee on the day of his employment.

(3)SELF-EMPLOYED - considered both employer and employee; under such

rules and regulations as SSS may prescribg including, but limited to: all selfemploycd profcssionals; prtners and single-proprietors of busincss; actors
and actreises; professional athletes, coaches, trainers and jockeys; upon their
registration with SSS
(4)Drimestic helpers, 60 years of age and below with a monthly income of :not
less than P1,000 on the date of their employment
(5) Individual &rrners and fishermen urrder SSS rulos and regulations

B. I'oluntrry
(l)Filipinos recruited by foreip-based omployers for employment abroad
(2)Erryloyee separated from employmgnt to maintain his right to full benefits
(3) Self-cmployed who rcalizes no inogpo fcr certain months

(4)Spouses who devote full time ro Fanaging household and family affairs
rrnless specifrcally mandatorily covgrod
64

C. NOT COVERED BYSSS

(I)

or business
Employmont purely asual and not foi the purpose of, occupation'

when
(2) Servioe.performed on or in connection with alien vessel' if-employed
such vessel is outside ofPhilippines
i
(3)Employees of Phihppine govemment br mstrumntality or agericyithreof

2. Bensfits

a, Momtl-rly Pension
b. DopendentsPension
c. Retirement
d. Death
e. Permanent DisabilitY

f.

Funeral

g.

Sickness
65

h. Maternity (only t$ FouR DELTVERTES OR MISCARRIAGES)

i.

LoanGrant

3. Degmdents
a. Legal spouse entitled for support,
b. Chil4 whether lcgitimato, lcgitimatcd, lcgally adoptod or itlcgitimate
c. Parentsdepondentforsupport
r

4. Conditions for Child to be Considcrcd Deucndent

a. Unmarried
b. Nor gainfully employed
c. flas not reached 2l years ofage;
d- Incapable of supporting himself either physically or mentally prior to 2l
years ofagd or age ofmajority, as the case may be

5. Bcnefcirrries

Primarv

(l)Dcpcndent Spouso until rernarriage and

(2)Dependent legitimate or Legitimated
Illegitimarc Children
B. Scconderv - Dependent parents

or Legally Adoped And

Absent primary and secondary beneficiaries, any other person

desigaated by member as secondar5r bencficiry

C. Othgrs

As to DEATH BENEFITS, if po beneficii.ty qualifips under this Act,

benefits shall be paid to Leqpl Heirs in aocordance with Law of
Succession.

6. Brsis of Contributions

All

actual remuneratiori for emplqyment, including the mandated cost-ofliving allowance, the cash value of any remuneration paid in aay rnedium
other than cash EXCEPT that part ot.or,*oution in excess of the maximum
salary credit.
66

,':

:i'jrr

^l

!h

-l'r,

Erceptions from Coverage:

l. Members ofthe AFP
2. Mombers of tho PNP

3.
4.

with
Contractual employees , who have no employer-employee relatiurship
the agency
Mernbers ofjudiCiary and constitutiopal conrmissions: covered by life
insurance only

Dependen6;
l. legitimate spouse depcndent.for support upon tho mmber or'pensioner
2. lcgitimatc, lcgitimatod, lcgally adoptcd ohild, including &e illogitimatc
child, who is unmarried, not gainfully employed, not over the age of

majorityorovertheageofmajorityputincapacitatedandiacapableofselfsupportduetoamentalorphysicaldefectaoquiredpriortoageofmajority.

3.

the parents dependent upon the member for support

Benefrciaries - PrimerY:
a. Legal, Dependent Spouse pptil'rouarriage and
b. Dcpendentchildren

a.
b.

SecondarY:
Depandent Pareots and
Legitimate descendants subject to resfiictions on depende'nt
chil&en, legitimate descendants

Baris of Contribution
The basic pay or salary received by an gpployee, pursuant to his
election/appointrnent, excluding per dieirs' bonuses, overtime pay, honoraria'
pay.
allowances and any other.emoluments rxceived in addition to the basic
Basb of Claim

68

1;]

:x{

old-age, disability, survivorship and other bensfits in oase the covcrcd menbcr
does not quali& for such benefits in either qy both Systems without tohlidion.
Overlapping periods of membership shall be crrdited only once for purposes
totdization.

of

member personally, and those that were paid by his

employers to both Systems shall be coosidgred in the processhg of benefits which
ho can claim from oithsr or both Systcrns.

All contributions paid by such

The mount of benefits to be paid by one Sysiem shall be in pnoportio to the

nuurber of contributims actually remitted to that System.

.-

70

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