Labor Law Review

University of Southern Philippines Foundation

PART ONE

(LABOR STANDARDS)

Introductory Concepts
A. LABOR LAWS, SOCIAL LEGISLATION AND SOCIAL JUSTICE
1. Definition
2. Principle of Social Justice
3. Labor Legislation vs Social Legislation

B. INTERPRETATION AND CONSTRUCTION OF LABOR STANDARDS

-

Art. 4 (Labor Code)

Acuna vs CA
G&M Phils. Inc. vs Cuambot
Eureka vs NLRC
Continental Steel Mfg. vs Montano
Penaflor vs Outdoor Clothing Mfg. Corp.

For the Employers Side:

- Cebu Metal Corp. vs Saliling
- Saracom vs Interorient Maritime Ent., Inc.
- NS Transportation Employees Assoc. vs NSTS Inc.

C. MANAGEMENT PREROGATIVE VS LABOR RIGHTS (REFER TO

AZUCENA VOL. II)
1. Management Prerogatives
Inherent Nature of Management Prerogatives
-

Phil. Industrial Security Agency Corp. vs Aguinaldo

Mendoza vs Rural Bank of Lucban
Placido Urbanes vs CA
Phil. Am Life & Gen Insurance Co. vs Gramaje
St. Michaels Institute vs Santos
Industrial Timber Corp. vs Ababon
First Dominion Resources Corp. vs Penaranda

2. Limitations on Exercise of Management Prerogatives

1. Hire

R.A. 7610
R.A. 9231

R.A. 7877 (applicability to MPs)

Art. 136(a) Labor Code
Art. 130 Labor Code
R.A. 7277
Yellow Dog Contract
R.A. 9208
D.O. 64-04 Series of 2004
D.O. 04 Series of 1999

2. Promote

Defined

- Millares vs Subido

Does not mean salary increase

- PTT Corp. vs CA

Employees refusal to be promoted

- Erasmo vs HIG Corp.

3. Demote

Nature

- Leonardo vs NLRC
- Fuerte vs Aquino

Due Process

- Floren Hotel vs NLRC

4. Transfer
-

Sentinel Security Agency vs NLRC

OSS Security & Allied Services Inc. vs NLRC
Mendoza vs Rural Bank of Lucban
Benguet Electric Cooperative vs Fianza
Tecson vs Glaxxo Wellcom Phils. Inc.
SMC vs Pontillas
Norkis Trading vs Gnillo
Aguanza vs Asian Terminal Inc.
Endico vs Quantum Food Distribution Center

Limits
-

Mendoza vs Rural Bank of Lucban

Benguet Electric Cooperative vs Fianza
Dusit Hotel Nikko vs NUWHRAIN
Allied Banking Corp. vs CA
Floren Hotel vs NLRC

Effects of Refusal by Emplyee

- Benguet Electric Cooperative vs Fianza

- Allied Banking Corp. vs CA
Related Cases
-

Phil-Singapore Transport Services Inc. vs NLRC

Palomares vs NLRC
Arellano, Jr. vs NLRC
Sobrepena, Jr. vs CA
Brew Master Intl. vs NAFLU
Isabelo vs NLRC
Phimco Industries Inc. vs NLRC
Benguet Electric Cooperative vs Fianza
PAL vs NLRC

5. Discipline
6. Management
7. Dismiss

D. PRESIDENTIAL DECREE NO. 442 (BRIEF HISTORICAL

BACKGROUND)
1. Significance
- P.D. 442 (11/01/74)
- R.A. 6715 (03/21/98)

E. BASIS FOR THE ENACTMENT OF LABOR LAWS

1. Police Power
- PASEI vs Drillon

2. Social Justice and Human Rights Provision

- Sec. 16, Art. II, 1987 Constitution
3. Doctrine of Incorporation
- Sec. 2, Art. II, 1987 Constitution

F. LIMITATIONS IN THE ENACTMENT OF LABOR LAWS (REFER TO

1987 CONSTITUTION)
1.
2.
3.
4.
5.

Equal Protection Clause

Due Process Clause
Prohibition Against Involuntary Servitude
Non-Impairment Clause
Requirement of Publication
- Art. 2, Civil Code

G. CONSTITUTIONAL RIGHTS OF WORKERS IN LABOR STANDARDS

1. Security of Tenure
2. Humane Conditions of Work

3. Living Wage
4. Just Share in the Fruits of Production
5. Co-determination
- Sec. 3, Art. XIII, 1987 Constitution

H. LABOR CONTRACTS AND INTERPRETATION

- Gonzales vs NLRC
- Servidad vs NLRC
- Grandteq Industrial Steel Products Inc. vs Margallo

I. LABOR CODE APPLICABILITY

- J.V. Angeles Construction vs NLRC
- Austria vs NLRC

J. DEFINITION
1. Employer (Art. 212(e) Labor Code)
2. Employee (Art. 212(f) Labor Code)
3. Test to Determine the Existence of Employer-Employee Relationship
FOUR-FOLD TEST
1. Right To Hire
2. Payment of Wages
3. Power of Dismissal
4. Control over the conduct of work

CRC Agricultural Trading vs NLRC (GR# 177664 12/23/09)

Dealco Farms Inc. vs NLRC (GR# 153192 01/30/09)
WPP Mtg. Comm. Inc. vs Galera (GR# 169207 03/25/10)
Galera vs WPP Mtg. Comm. Inc. (GR# 169239 03/25/10)
Gomez vs PDMC (GR# 174044 11/27/09)
Tomaquin vs PLDT (GR# 185251 10/02/09)
Masonic Contractor Inc. vs Madjos (GR# 185094 11/25/09)

Main Concepts
A. RECRUITMENT AND PLACEMENT OF WORKERS
1. Migrant Workers and Overseas Filipinos Act of 1995 (R.A. 8042)

Constitutionality

- Executive Secretary vs CA
- People vs Chowdury

Jurisdiction of Money Claims, Death Benefits, and other Benefits

Jurisdiction over Disciplinary Actions of OFWs
Liability of Local Recruitment Agency and Foreign Principal
Entities Authorized to Engage in Recruitment and Placement
Country Team Approach

2. Effect of Absence of Consideration

- People vs Piedra
3. Illegal Recruitment

Definition
Elements of Illegal Recruitment
Economic Sabotage
Prescriptive Period for Illegal Recruitment and Economic Sabotage
Liabilities (Civil, Criminal, and Administrative)
People vs BULI-E
People vs Baytic
People vs Corpus
People vs Crispin Billaber
People vs Flor Gutierrez
People vs Ramon Dujua
People vs Leticia Sagayaga
People vs Mario Alzona
Rodolfo vs People

B. WAGES
1. Basic Concept and Principles

Characteristics of Wages
Wage vs Salary
Non-Diminution of Benefits
TSPIC Corp. vs TSPIC Employees Union
Millares vs NLRC
Intl School Alliance of Educators vs Quisumbing
Aklan Electric Cooperative vs NLRC
Methods of Fixing Compensation

a. Time Spent
b. Commission
c. Task
2. Facilities and Supplements
-

Mabeza vs NLRC
Cebu Autobus Co. vs United Cebu Autobus Employees Assoc.
State Marine Cooperation vs Cebu Seamens Assoc. Inc.
Mayon Hotel & Restaurant vs Adana

3. Procedure in Fixing the Minimum Wage

Regionalized (through RTWPB) vs Legislated Wage Fixing

Factors in Determination of Minimum Wage Fixing
Wage Order and Appeal
Effectivity of Wage Order

- Jaguar Security & Investigation Agency vs Sales

4. Wage Distortion

Definition
Elements of Wage Distortion

 How to Resolve Wage Distortion (Organized and Unorganized

Establishments)
-

Prubankers Assoc. vs Prudential Bank

Bankard Employees Union vs NLRC
P.I. Mfg. Inc. vs PIMSFA
TSPIC Corp. vs TSPIC-EU
Metrobank Inc. vs NWPC
Norkis Free & Independent Workers Union vs Norkis Trading Co.

5. Exemption from Minimum Wage Law

Art. 98 Labor Code

NWPC Guidelines No. 01 Series of 1996

- RCPI vs NLRC
- Joy Brothers Inc. vs NWPC
6. Wages
Form of Payment
- Art. 102 Labor Code

ATM Guidelines
- Labor Advisory Nov. 25, 1996

Payment by Check or Money Order

- Sec. 2, Rule III, IRR

Payment Through a Bank

Place of Payment
Time of Payment
Whom to Pay?
Valid Deductions
Prohibitions Regarding Wages
Penalty for Non-Compliance of Wage Order
Allowances
Tips
Bonus

- Protacio vs Laya Mananghaya & Co.

- Lepanto Ceramics Inc. vs Lepanto Ceramics Employees Assoc.
- UST vs SM - UST

7. Administration and Enforcement of Wage Orders (Art. 128-129)

- Balladares vs Peak Ventures Corp.

-

Jethro Intelligence & Security Corp. vs Sec. of Labor

Peoples Broadcasting vs Sec. of Labor
Phil. Hoteliers Inc. vs NUWHRAIN-APL-IUF
Alberta Yanson vs Sec. of Labor

C. CLASSIFICATION OF EMPLOYEES

1. Regular vs Casual Employees

-

SMC vs Teodosio
PLDT vs Arceo
ABS-CBN vs Nazareno
Poseidon Fishing vs NLRC
Big AA Mfg. vs Antonio
Paguio vs NLRC

2. Seasonal
- Hacienda Fatima vs NFSWF
3. Project
-

Ronilo Sorreda vs Cambridge Electronics Corp.

Willam Uy Construction Corp. vs Trinidad
Rosita Pangilinan vs GMC
C.E. Construction Corp. vs Cloco, Jr.
Abesco vs Ramirez
Samson vs NLRC
ABS-CBN vs Nazareno
Poseidon Fishing vs NLRC
PLDT vs Ylagan
Bahia Shipping Services vs Chua
Virgilio Sapio vs Castro

4. Piece Rate
- Labor Congress of the Phils vs NLRC
- Lambo vs NLRC
5. Probationary
-

Cebu Marine Beach Resort vs NLRC

Rodin Alcira vs NLRC
Mistubishi Motors vs Chrysler Phils. Labor Union
Dusit Hotel Nikko vs Gatbonton
Mercado vs AMA Computer

D. HOURS OF WORK
1. Hours of Work Defined
Principles and Concepts
- Navarro vs P.V. Pajarillo Liner Inc.
2. Rest Period
3. Meal Break
- PAL vs NLRC
4. Workweek (Case of Hospital Personnel, Art. 83)
5. Overtime Pay

Performed in an Ordinary Day

Performed on a Rest Day or on a Special Day
Performed on a Rest Day which falls on a Special Day

 Performed overtime work on a Regular Day

Performed on a Rest Day which falls on a Regular Holiday

- Damasco vs NLRC
Circumstances when an employee will be compelled to render
overtime and consequences of refusal
6. Premium Pay
Premium pay on a Rest Day Work
Premium on Sunday when it is the Employees Rest Day
Premium Pay on Sundays and Holidays when Employee has no
Regular Workdays and No Scheduled Regular Rest Day
Premium Pay for work performed on Special Holidays (now Special
Days) which fall on an Employees Scheduled Rest Day
Premium Pay for work performed during Special Day
7. Holiday Pay
Definition
Eleven(11) Regular Holidays and Two (2) Special Days under R.A.
9177 (11/13/02)
Application of Principle of No Work, No Pay
Effects of Absences during successive Regular Holidays
Rule in case Two(2) Regular Holidays falling on the same day.
- Asian Transmission Corp. vs CA

Application of Muslim Holiday to Non-Muslims

- SMC vs CA
- Trans-Asia Employees Assoc. vs NLRC
- Arellano Univ. EEs and Workers Union vs CA
8. Service Incentive Leave
-

Imbuido vs NLRC
Integrated Contractor & Plumbing Works Inc. vs NLRC
Auto Bus Transport System Inc. vs Bautista
ARCO Metal Products vs Samahan ng Manggagawa sa ARCO

9. Night-Shift Pay

Where Night Shift (10pm to 6am) Work is Regular Work

Where Night Shift (10pm to 6am) Work is Overtime Work

10. 13th Month Pay

Who are entitled to 13th Month Pay?
- Clarion Printing House Inc. vs NLRC
- JPL Mktg. Promotions vs CA
- PAL vs PALEA

Employers exempted from 13th Month Pay Law

Tax Exemption

 The phrase Its Equivalent in the 13th Month Pay Law

RELEVANT CASE:
- Sevilla Trading Co. vs A.V.A. Tomas E. Semana
11.Service Charges
12.Exemptions
- Penaranda vs Baganga Plywood Corp.

E. JOB CONTRACTING AND LABOR-ONLY CONTRACTING

1. Art. 106
2. Art. 109

Legitimate Job Contracting

- Aliviado vs Procter & Gamble Phils., Inc.

- Singo vs Shangri-Las Mactan Island Resort
Labor-Only Contracting, Effects and DOLE D.O. No. 18-02 Series of
2002
-

Coca-Cola Bottlers vs Agito

Coca-Cola Bottlers vs Dela Cruz
South Davao Devt. vs Gamo
Iligan Cement Corp. vs IEWU-SPFL
Mandaue Galleon Trade Inc. vs Andales

3. In-House Agency (Sec. 6, DOLE D.O. No. 18-02 Series of 2002)

RELEVANT CASES:
-

Filipinas vs NLRC
Lapanday vs CA
Security & Credit Investigation vs NLRC
Esparwa Security & Janitorial Services Inc. vs Liceo De Cagayan Univ.
Acevedo vs Advanstar Co. Inc.

F. PREFERENCE OF WAGES
1. In case of Bankruptcy or in Judicial Proceedings (Art. 110 Labor Code)
- DBP vs Sec. of Labor
- DBP vs NLRC
2. Rehabilitation, Receivership on Monetary Claims of Workers; Effects
- DOLE vs Maceda
- Tiangco vs Uniwide Sales Warehouse Club Inc.

G. APPEARANCE OF LAWYERS AND NON-LAWYERS IN LABOR

CASES

H. SPECIAL TYPES OF WORKERS

1. Apprentices

What is an apprenticeship agreement?

Who is an apprentice?
Wage of an apprentice
Qualifications of an apprentice
Limitations in hiring of an apprentice
Regularization of an apprentice

2. Handicaps (R.A. 7277)

Definition of Terms: Handicap, disabled and impaired

Handicapped worker and His/Her rights (Art. 80 81 Labor Code)
Handicapped vs Disabled Employees

3. Learners

Who is a learner?
Requisites in hiring a learner
Wage of a learner

4. Women Workers

Art. 130 (Nightwork Prohibition)

Exceptions to Nightwork Prohibition
Required facilities for women
Acts of Discrimination against women prohibited under R.A. 6725

5. Student Workers

R.A. 7323
Sec. 14, Rule X, Book 3, IRR
Employer-Employee Relationship

6. Domestic or Household Service Workers

Art. 302 of the Civil Code
Art. 143 Labor Code
R.A. 7655
Rights of a Househelper (Wage, SSS, Art. 145, 147, 148, 150 Labor
Code and Art. 1694, 1698 Civil Code)
Employment of Minor as Househelper
7. Alien Employees

Requisites in Hiring Alien Employees

Art. 40, 41, 42 of the Labor Code
Limitations in hiring of alien employees

I. QUITCLAIMS
- Rizada vs NLRC

Lambo vs NLRC
C & A Construction Co., Inc. vs NLRC
Malinaw vs NLRC
PNCC vs NLRC
Phil. Carpet Exporters Assoc. vs PCMC
ACD Investigation Security Agency vs Daquera
R & E Transport Inc. vs Latag
Magbanua vs UY
Catholic Vicariate vs Sto. Tomas

J. SECURITY OF TENURE
1. Scope
- PLDT vs Tolentino
- Fujitsu vs CA
- Condo Suite Club Travel Inc. vs NLRC
2. Constructive Dismissal vs Illegal Dismissal
-

Fernando Go vs CA
Unicorn Safety Glass Inc. vs Basarte
Artiaga vs Siliman University
Merck Sharp and Dohme vs Robles
Penaflor vs Outdoor Clothing Mfg. Corp.

3. Preventive Suspension (Sec. 8-9, Rule 23, Book V, IRR)

Grounds
Duration
Extension
JRS Business Corp. vs NLRC
Gandara Supply vs NLRC
Atlas Fertilizer Corp. vs NLRC
Chona Torres vs NLRC

K. TERMINATION OF EMPLOYMENT
1. Requisites for a Valid Dismissal (Sec. 1, Art. II, Constitution; Art. 277(b)
Labor Code)
a. Substantial Evidence
-

Salvador vs Phil. Mining Services Corp.

Sevillana vs I.T. Ints Corp
Millares vs PLDT
Philtread Tire & Rubber Corp. vs Alberto Vicente

b. Due Process (Notice Requirement)

-

Shoppes Manila Inc. vs NLRC

Valiao vs CA
King of Kings Transport vs Mamac
Uniwide Sales Warehouse Club vs NLRC
Placido vs NLRC
Technol Eight Phils. Corp. vs NLRC
Oscar Garcia vs NLRC
Bacolod-Talisay Realty & Devt Corp. vs Dela Cruz

c. Burden of Proof
- Mantle Trading Services Inc. vs NLRC
- Phil. Veterans Bank vs NLRC
d. Principle of Discretionary Justice
- Almira vs BF Goodrich
- VH Mfg. Inc. vs NLRC
- Tipteo vs CA

2. Just Causes for Termination of Employment (Art. 282 Labor Code)

a. Serious Misconduct or Willful Disobedience
-

Oscar Garcia vs Malayan Insurance

Bughaw vs Treasure Island
Citibank vs NLRC
Tomada Sr. vs RFM Corp
Reno Foods Inc. vs NLM-Katipunan
PLDT vs Berbano
Plantation Bay Resort vs Dubrico
Baron vs NLRC

b. Gross and Habitual Neglect

-

Tres Reyes vs Maxims Tea House

Golden Thread Knitting vs NLRC
Jo vs NLRC
Icawat vs NLRC
R. Transport Corp. vs Ejandra
Union Motor Corp. vs NLRC
RP Dinglasan Construction Inc. vs Atienza
Cosmos Bottling Corp. vs Nagrama

c. Fraud or Willful Breach of Trust/Loss of Confidence

-

Nokom vs NLRC
Delos Santos vs NLRC
PLDT vs Tolentino
Charles Ramos vs CA
Adelino Felix vs NLRC
Rolando Aromin vs NLRC

d. Commission of a Crime against Employer

e. Other Analogous Cases
- Cathedral School of Technology vs NLRC
- PT&T vs NLRC

3. Authorized Causes (Art. 283 Labor Code)

a. Installation of Labor Saving Devices
- Asian Alchohol Corp. vs NLRC
- Dole Phils. Vs NLRC
- Serrano vs NLRC
b. Redundancy: Requisites

Golden Thread Knitting vs NLRC

Witshire File Co. Inc. vs NLRC
Dole Phils. vs NLRC
Bonifacio Asufrin vs CA

c. Retrenchment to Prevent Losses

-

EMCO Plywood Corp. vs Ablegas

PLDT vs NLRC
Cajucom VII vs TPI Phils. Cement Corp.
Manatad vs PT&T
Brizuela vs Dingle
Anabe vs Asian Const.
Hotel Enterprises of the Phils. Inc. vs SAMASAH-NUWHRAIN
Mendros vs Mitsubishi Motors Phils. Corp.
FASAP vs PAL
Talam vs NLRC

d. Closure or Cessation of Operation due to Serious Business Losses

-

North Davao Mining vs NLRC

Cama vs Jonis Food Services Inc.
CBL Transit Inc. vs NLRC
Nasipit Lumber Co. vs NLRC
Mandaue Dinhow Dimsum House vs NLRC
Solidbank Corp. vs NLRC

e. Criteria in Termination of Employees under Authorized Causes

(except Closure)
- Maya Farms vs NLRC
- Capitol Wireless vs Confessor
f. Procedural Requirement under Art. 283 Labor Code
- Sec. 2, Rule 23, Book V, IRR
- Twin Notice Requirement

4. Disease (Art. 284 Labor Code)

- Cruz vs NLRC
- ATCI Overseas Corp. vs CA
5. Retirement
-

Divina Lopez vs Natl Steel Corp.

R&E Transport vs Latag
Eastern Shippin Lines Inc. vs Antonio
Kimberly-Clark Phils. Inc. vs Dimayuga
Januaria Rivera vs United Laboratories Inc.

6. Resignation (Art. 285 Labor Code)

- Alfaro vs CA
- Azcor Mfg. Inc. vs NLRC
- Mobile Protective & Detective Agency vs Ompad

L. CONSEQUENCES OF ILLEGAL DISMISSAL

1. Reinstatement (Art. 279 Labor Code)
1. Nature
- Cabigting vs San Miguel Foods Inc.
- Dumago vs PAL
2. Instances when Reinstatement is not Possible
- Manila Diamond Hotel EU vs CA
- Golden Ace Builders vs Talde
2. Backwages
-

Jenny Agabon vs NLRC

Chronicles Securities Corp. vs NLRC
Phil. Journalist Inc. vs Mosqueda
Mitsubishi Motors Phils. Corp. vs Chrysler Phils Labor Union
Sime Darby Pilipinas Inc. vs Arguilla
Javellana, Jr. vs Belen
Javellana, Jr. vs Javellana Farms Inc.
Fe La Rosa vs Ambasador Hotel

DAMAGES
-

Colegio de San Juan vs Villas

Cruz vs NLRC
Mayon & Hotel Restaurant
Phil. Employ Services & Resources Inc. vs Paramlo
Armando David vs Natl Fed. Of Labor Union
Virgilio Sapio vs Undaloc Construction
Celebes Japan Foods Corp. vs Yermo
Bernardo Jose, Jr. vs Michaelmar Phils. Inc.
Genesis Transport Services Inc. vs UMMGT
Hilton Heavy Equipment Corp. vs Ananias Dy

3. Separation Pay
- PLDT vs NLRC
(Discerning Compassion Doctrine)
- PCI Bank vs Abad
- Phil. Commercial Intl Bank vs Abad
- Diversified Sec. Inc. vs Alicia Bautista
- Sagrasso Construction & Devt Corp. vs NLRC

4. Attorneys Fees (Art. 111 Labor Code)

M. PRESCRIPTIVE PERIOD
1.
For Illegal Dismissal (Art. 1146 Civil Code)
of Action Accrued
2.
Unfair Labor Practice
Action Accrued
3.
Money Claims
Action Accrued
- Kar Asia Inc. vs Corona

- 4 yrs from Cause

- 1 yr from Cause of
- 3 yrs from Cause of

- Texon Mfg. vs Millena