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Up Law Boc Labor 2016 2 PDF
Up Law Boc Labor 2016 2 PDF
College of Law
Bar Reviewer
1ST WEEK
LABOR
LAW
Table of Contents
LABOR STANDARDS 1 F.3. Paternity Leave 55
F.4. Parental Leave 56140
I. Fundamental Principle and Policies 2 F.5. Leaves For Victims of
A. Constitutional Provisions 2 Violence Against Women 57
B. Civil Code 6 F.6. Special Leave Benefits
C. Labor Code 8 (SLB) For Women 59
II. Recruitment and Placement 12 G. Service Charges 61
A. Recruitment of Local and H. Thirteenth (13th) Month Pay
Migrant Workers 12 and Other Bonuses 62
A.1. Illegal Recruitment 13 I. Separation Pay 65
III. Labor Standards 26 J. Retirement Pay 67
A. Coverage 26 J.1. Eligibility 67
A.1. Government Employees 26 J.2. Amount of Retirement Pay 68
A.2. Managerial Employees 27 J.3. Retirement Benefits of Workers
A.3. Field Personnel 28 Who Are Paid By Results 68
A.4. Dependent Family Members 28 J.4. Retirement Benefit of
A.5. Domestic helpers 28 Part-Time Workers 68
A.6. Persons in Personal J.5. Taxability 69
Service of Another 28 K. Women Workers 70
A.7. Workers Paid by Result 29 K.1. Provisions Against Discrimination 70
B. Hours Of Work 29 K.2. Stipulation Against Marriage 70
B.1. Coverage/Exclusions 29 K.3. Prohibited Acts 70
B.2. Normal Hours of Work 29 K.4. Anti-Sexual Harassment 72
B.3. Meal Break 34 L. Minor Workers 73
B.4. Waiting Time 35 M. Employment Of Househelpers 76
B.5. Overtime Work, Overtime Pay 35 N. Employment Of Homeworkers 79
B.6. Night Work, O. Apprentices And Learners 80
Night Shift Differential 37 O.1. Apprentices 80
B.7. Part-Time Work 39 O.2. Learners 83
B.8. Contract for Piece of Work 39 P. Handicapped Workers – Differently-Abled
C. Wages 40 Workers 85
C.1. Wage vs. Salary 40 IV. Termination of Employment 90
C.2. Minimum Wage 41 A. Employer-employee relationship 90
C.3. Minimum Wage of Workers Paid By A.1. Four-fold test 91
Results 42 A.2. KINDS OF EMPLOYMENT 92
C.4. Commissions 43 A.3. Job contracting 99
C.5. Deductions From Wages 43 B. DISMISSAL FROM EMPLOYMENT 104
C.6. Non-Diminution Of Benefits 44 B.1. Just Causes 107
C.7. Facilities vs Supplements 44 B.2. Authorized Causes 113
C.8. Wage Distortion/Rectification 45 B.3 Other Causes 118
C.9. Divisor to Determine Daily Rate 46 B.4 Due Process 120
D. Rest Days 47 C. Reliefs for Illegal Dismissal 123
D.1. Weekly Rest Day 47 C.1. Reinstatement 123
D.2. Emergency Rest Day Work 47 C.2. Backwages 125
E. Holiday Pay/Premium Pay 47 D. Preventive Suspension 126
E.1. Coverage 48 D.1.Duration 126
E.2. Teachers, Piece Workers, D.2. Preventive Suspension As a Protective
Seafarers, Seasonal Workers, Etc. 51 Measure v. Suspension As Penalty 127
F. Leaves 53 E. Constructive Dismissal 127
F.1. Service Incentive Leave Pay 53 V. Management Prerogative 127
F.2. Maternity Leave 54 A. Discipline 127
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UP LAW BOC TABLE OF CONTENTS LABOR LAW
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UP LAW BOC TABLE OF CONTENTS LABOR LAW
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UP LAW BOC LABOR STANDARDS LABOR LAW
LABOR LAW
LABOR STANDARDS
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Wearing armbands and putting up placards demands that one party to the contract shall
to express one’s views without violating the be protected against himself. [Leyte Land
rights of third parties, are legal per se and Transportation Co. vs. Leyte Farmers &
even constitutionally protected. [Bascon v CA, Workers Union, G.R. No. L-1377 (1948)]
G.R. No. 144899 (2004)]
Section 7. The right of the people to
Section 16. All persons shall have the right to
information on matters of public concern
a speedy disposition of their cases before all
shall be recognized. Access to official records,
judicial, quasi-judicial, or administrative
and to documents and papers pertaining to
bodies.
official acts, transactions, or decisions, as
well as to government research data used as Section 18 (2). No involuntary servitude in any
basis for policy development, shall be form shall exist except as a punishment for a
afforded the citizen, subject to such crime whereof the party shall have been duly
limitations as may be provided by law. convicted.
Section 8. The right of the people, including
those employed in the public and private
A.3 Article XIII, Secs 1, 2, 3, 13, 14
sectors, to form unions, associations, or
societies for purposes not contrary to law Section 1. The Congress shall give highest
shall not be abridged. priority to the enactment of measures that
protect and enhance the right of all the
people to human dignity, reduce social,
The Right to Form Associations economic, and political inequalities, and
remove cultural inequities by equitably
The right to form associations shall not be
diffusing wealth and political power for the
impaired except through a valid exercise of
common good.
police power. [Bernas, The 1987 Philippine
Constitution: a Comprehensive Reviewer] To this end, the State shall regulate the
acquisition, ownership, use, and disposition
of property and its increments.
Section 10. No law impairing the obligation of
Section 2. The promotion of social justice
contracts shall be passed.
shall include the commitment to create
Non-impairment of Contracts economic opportunities based on freedom of
initiative and self-reliance.
A law which changes the terms of a legal
contract between parties, either in the time or Section 3. The State shall afford full
mode or performance, or imposes new protection to labor, local and overseas,
conditions, or dispenses with those expressed, organized and unorganized, and promote full
or authorizes for its satisfaction something employment and equality of employment
different from that provided in its terms, is a opportunities for all.
law which impairs the obligation of a contract
It shall guarantee the rights of all workers to
and is null and void. [Clemens vs. Nolting
self-organization, collective bargaining and
(1922)]
negotiations, and peaceful concerted
activities, including the right to strike in
accordance with law. They shall be entitled to
Vis-à-vis the freedom of contract
security of tenure, humane conditions of
The prohibition to impair the obligation of work, and a living wage. They shall also
contracts is not absolute and unqualified. In participate in policy and decision-making
spite of the constitutional prohibition and the processes affecting their rights and benefits
fact that both parties are of full age and as may be provided by law.
competent to contract, it does not necessarily
The State shall promote the principle of
deprive the State of the power to interfere
shared responsibility between workers and
where the parties do not stand upon an
employers and the preferential use of
equality, or where the public health
voluntary modes in settling disputes,
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including conciliation, and shall enforce their discretion and judgment, all aspects of
mutual compliance therewith to foster employment, including hiring, work
industrial peace. assignments, working methods, the time,
place and manner of work, work supervision,
The State shall regulate the relations
transfer of employees, lay-off of workers, and
between workers and employers, recognizing
discipline, dismissal, and recall of employees.
the right of labor to its just share in the fruits
The only limitations to the exercise of this
of production and the right of enterprises to
prerogative are those imposed by labor laws
reasonable returns to investments, and to
and the principles of equity and substantial
expansion and growth.
justice. [Peckson v Robinson’s Supermarket
Corporation, G.R. No. 198534, (2013)]
Participation in Decision-Making The exercise of management prerogative is
Process valid provided it is not performed in a
malicious, harsh, oppressive, vindictive or
Verily, a line must be drawn between
wanton manner or out of malice or spite.
management prerogatives regarding
[Magdadaro v. PNB, G.R. No. 166198 (2009)]
business operations per se and those which
affect the rights of the employees. In treating
the latter, management should see to it that
Limits to Management Prerogative
its employees are at least properly informed
of its decisions or modes action. Indeed, (1) Good faith - So long as a company’s
industrial peace cannot be achieved if the management prerogatives are exercised in
employees are denied their just participation good faith for the advancement of the
in the discussion of matters affecting their employer’s interest and not for the purpose of
rights. [Phil. Airlines Inc. vs. NLRC, G.R. No. defeating or circumventing the rights of the
85985 (1993)] employees under special laws or under valid
agreements, this Court will uphold
them…Even as the law is solicitous of the
Managem ent and the Constitution: welfare of the employees, it must also protect
Managem ent Function/Prerogative the right of an employer to exercise what are
clearly management prerogatives. The free
The law in protecting the rights of the
will of management to conduct its own
employees authorizes neither oppression nor
business affairs to achieve its purpose cannot
self-destruction of the employer. It should be
be denied. [Ernesto G. Ymbong vs. ABS-CBN
made clear that when the law tilts the scale
Broadcasting Corp., G.R. No. 184885 (2012)]
of justice in favor of labor, it is but a
recognition of the inherent economic (2) W ithout grave abuse of discretion
inequality between labor and management. - But, like other rights, there are limits
Never should the scale be so tilted if the thereto. The managerial prerogative to
result is an injustice to the employer. transfer personnel must be exercised without
[Panuncillo v CAP, G.R. No. 161305 (2007)] grave abuse of discretion, bearing in mind the
basic elements of justice and fair play. Having
This Court held that the employer’s right to
the right should not be confused with the
conduct the affairs of his business according
manner in which the right is exercised. [Tinio
to its own discretion and judgment, is well-
vs. CA, G.R. No. 171764 (2007)]
recognized. An employer has a free reign and
enjoys wide latitude of discretion to regulate (3) Law – In one case, a pharmaceutical
all aspects of employment. This is a company defended its termination of rank
management prerogative, where the free will and file employees during a bargaining
of management to conduct its own affairs to deadlock, as an exercise of management
achieve its purpose takes form. [Torreda vs. prerogative. This was after the Labor
Toshiba, G.R. No. 165960 (2007)] Secretary had assumed jurisdiction over the
dispute and enjoined the parties from “any
Under the doctrine of management
acts which might exacerbate the situation.”
prerogative, every employer has the inherent
right to regulate, according to his own
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The Court disagreed with the company’s privilege is not absolute, but subject to
defense, stating that the privilege is not exceptions. One of these exceptions is when
absolute but subject to limitations imposed the Secretary of Labor assumes jurisdiction
by law. In this case, it is limited by Sec. over labor disputes involving industries
236(g), which gives the Secretary the power indispensable to the national interest under
to assume jurisdiction and resolve labor Article 263(g) of the Labor Code. [University
disputes involving industries indispensable to of Immaculate Concepcion Inc. vs. Sec. of
national interest. Labor, G.R. No. 151379 (2005)]
The company’s management prerogatives are
not being unjustly curtailed but duly
Section 13. The State recognizes the vital role
tempered by the limitations set by law, taking
of the youth in nation-building and shall
into account its special character and the
promote and protect their physical, moral,
particular circumstances in the case at bench.
spiritual, intellectual, and social well-being. It
[Metrolab Industries, Inc. v. Roldan-Confesor,
shall inculcate in the youth patriotism and
G.R. No. 108855 (2013)]
nationalism, and encourage their
(4) Collective Bargaining – The CBA involvement in public and civic affairs.
provisions agreed upon by the Company and
Section 14. The State shall protect working
the Union delimit the free exercise of
women by providing safe and healthful
management prerogative. The parties in a
working conditions, taking into account their
CBA may establish such stipulations, clauses,
maternal functions, and such facilities and
terms and conditions as they may deem
opportunities that will enhance their welfare
convenient provided these are not contrary to
and enable them to realize their full potential
law, morals, good customs, public order or
in the service of the nation.
public policy. Where the CBA is clear and
unambiguous, it becomes the law between
the parties and compliance therewith is
B. Civil Code
mandated by the express policy of the law.
[Goya v. Goya, Inc., Employees Union-FFW, B.1 Article 19
G.R. No. 170054 (2013)]
Article 19. Every person must, in the exercise
(5) Equity and/or Substantial Justice – of his rights and in the performance of his
The Court recognized the inherent right of the duties, act with justice, give everyone his due,
employer to discipline its employees but it and observe honesty and good faith.
should still ensure that the employer
exercises the prerogative to discipline
humanely and considerately, and that the B.2 Article 1700
sanction imposed is commensurate to the
offense involved and to the degree of the Article 1700. The relations between capital
infraction. The discipline exacted by the and labor are not merely contractual. They
employer should further consider the are so impressed with public interest that
employee’s length of service and the number labor contracts must yield to the common
of infractions during his employment. good. Therefore, such contracts are subject to
[Dongon v. Rapid Movers and Forwarders Co., the special laws on labor unions, collective
Inc., G.R. No. 163431 (2013)] bargaining, strikes and lockouts, closed shop,
wages, working conditions, hours of labor
and similar subjects.
Assum ption of jurisdiction by the
Secretary of Labor
B.3. Article 1702
This Court declared that it recognizes the
exercise of management prerogatives and it Article 1702. In case of doubt, all labor
often declines to interfere with the legitimate legislation and all labor contracts shall be
business decisions of the employer… construed in favor of the safety and decent
However, as expressed in PAL vs. NLRC, the living for the laborer.
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it the corollary right to expect from the doubts in the implementation and
workers adequate work, diligence and good interpretation of the provisions of this Code,
conduct. [Judy Philippines, Inc. v NLRC, G.R. including its implementing rules and
No. 111934, (1998)] regulations, shall be resolved in favor of labor
C. Labor Code (Books I, II, III, V, VI, It is settled that subsequent and substantial
and VII are covered in this reviewer. compliance may call for the relaxation of the
This section discusses the policy and rules of procedure…The Court has time and
miscellaneous provisions) again relaxed the rigid application of the
rules to offer full opportunity for parties to
ventilate their causes and defenses in order
C.1 Article 3 to promote rather than frustrate the ends of
justice. [Ma. Ligaya Santos vs. Litton Mills, G.R.
Article 3. Declaration of basic policy. The No. 170646 (2011)]
State shall afford protection to labor,
promote full employment, ensure equal work
opportunities regardless of sex, race or creed C.3 Article 172 (Previously Article 166)
and regulate the relations between workers
and employers. The State shall assure the Article 166. Policy. - The State shall promote
rights of workers to self-organization, and develop a tax-exempt employees’
collective bargaining, security of tenure, and compensation program whereby employees
just and humane conditions of work. and their dependents, in the event of work-
connected disability or death, may promptly
secure adequate income benefit and medical
C.2 Article 4 related benefits.
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W orkm en’s Com pensation Program otherwise provided under this Code.
This is the general and comprehensive term
applied to those laws providing for
C.5 Article 219 (Previously Article 212)
compensation for loss resulting from the
injury, disablement, or death of workmen Article 219.Definitions. –
through industrial accident, casualty, or
disease. [Azucena, The Labor Code with (a) “Commission” means the National Labor
Comments and Cases] Relations Commission or any of its
divisions, as the case may be, as provided
under this Code.
C.4 Article 218 (Previously Article 211) (b) “Bureau” means the Bureau of Labor
Relations and/or the Labor Relations
Article 218. Declaration of Policy. –
Divisions in the regional offices
A. It is the policy of the State: established under Presidential Decree
(a) To promote and emphasize the No. 1, in the Department of Labor.
primacy of free collective bargaining (c) “Board” means the National Conciliation
and negotiations, including voluntary and Mediation Board established under
arbitration, mediation and conciliation, Executive Order No. 126.
as modes of settling labor or industrial
(d) “Council” means the Tripartite Voluntary
disputes;
Arbitration Advisory Council established
(b) To promote free trade unionism as an under Executive Order No. 126, as
instrument for the enhancement of amended.
democracy and the promotion of social
justice and development; (e) “Employer” includes any person acting in
the interest of an employer, directly or
(c) To foster the free and voluntary indirectly. The term shall not include any
organization of a strong and united labor organization or any of its officers or
labor movement; agents except when acting as employer.
(d) To promote the enlightenment of (f) “Employee” includes any person in the
workers concerning their rights and employ of an employer. The term shall
obligations as union members and as not be limited to the employees of a
employees; particular employer, unless the Code so
(e) To provide an adequate administrative explicitly states. It shall include any
machinery for the expeditious individual whose work has ceased as a
settlement of labor or industrial result of or in connection with any current
disputes; labor dispute or because of any unfair
labor practice if he has not obtained any
(f) To ensure a stable but dynamic and other substantially equivalent and
just industrial peace; and regular employment.
(g) To ensure the participation of workers (g) “Labor organization” means any union or
in decision and policy-making association of employees which exists in
processes affecting their rights, duties whole or in part for the purpose of
and welfare. collective bargaining or of dealing with
B. To encourage a truly democratic method employers concerning terms and
of regulating the relations between the conditions of employment.
employers and employees by means of (h) “Legitimate labor organization” means
agreements freely entered into through any labor organization duly registered
collective bargaining, no court or with the Department of Labor and
administrative agency or official shall have Employment, and includes any branch or
the power to set or fix wages, rates of pay, local thereof.
hours of work or other terms and
conditions of employment, except as (i) “Company union” means any labor
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organization whose formation, function (o) “Strike” means any temporary stoppage
or administration has been assisted by of work by the concerted action of
any act defined as unfair labor practice by employees as a result of an industrial or
this Code. labor dispute.
(j) “Bargaining representative” means a (p) “Lockout” means any temporary refusal
legitimate labor organization whether or of an employer to furnish work as a result
not employed by the employer. of an industrial or labor dispute.
(k) “Unfair labor practice” means any unfair (q) “Internal union dispute” includes all
labor practice as expressly defined by the disputes or grievances arising from any
Code. violation of or disagreement over any
provision of the constitution and by laws
(l) “Labor dispute” includes any controversy
of a union, including any violation of the
or matter concerning terms and
rights and conditions of union
conditions of employment or the
membership provided for in this Code.
association or representation of persons
in negotiating, fixing, maintaining, (r) “Strike-breaker” means any person who
changing or arranging the terms and obstructs, impedes, or interferes with by
conditions of employment, regardless of force, violence, coercion, threats, or
whether the disputants stand in the intimidation any peaceful picketing
proximate relation of employer and affecting wages, hours or conditions of
employee. work or in the exercise of the right of self-
organization or collective bargaining.
(m) “Managerial employee” is one who is
vested with the powers or prerogatives to (s) “Strike area” means the establishment,
lay down and execute management warehouses, depots, plants or offices,
policies and/or to hire, transfer, suspend, including the sites or premises used as
lay-off, recall, discharge, assign or runaway shops, of the employer struck
discipline employees. Supervisory against, as well as the immediate vicinity
employees are those who, in the interest actually used by picketing strikers in
of the employer, effectively recommend moving to and fro before all points of
such managerial actions if the exercise of entrance to and exit from said
such authority is not merely routinary or establishment.
clerical in nature but requires the use of
independent judgment. All employees
not falling within any of the above C.6 Article 267 (Previously Article
definitions are considered rank-and-file 255)
employees for purposes of this Book.
Article 267. Exclusive bargaining
(n) “Voluntary Arbitrator” means any person representation and workers’ participation in
accredited by the Board as such or any policy and decision making. - The labor
person named or designated in the organization designated or selected by the
Collective Bargaining Agreement by the majority of the employees in an appropriate
parties to act as their Voluntary collective bargaining unit shall be the
Arbitrator, or one chosen with or without exclusive representative of the employees in
the assistance of the National such unit for the purpose of collective
Conciliation and Mediation Board, bargaining. However, an individual employee
pursuant to a selection procedure agreed or group of employees shall have the right at
upon in the Collective Bargaining any time to present grievances to their
Agreement, or any official that may be employer.
authorized by the Secretary of Labor and
Any provision of law to the contrary
Employment to act as Voluntary
notwithstanding, workers shall have the
Arbitrator upon the written request and
right, subject to such rules and regulations as
agreement of the parties to a labor
the Secretary of Labor and Employment may
dispute.
promulgate, to participate in policy and
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work different from the actual overseas authorized under the Labor Code and
work, or work with a different employer its implementing rules and regulations;
whether registered or not with the POEA;
(k) Failure to actually deploy a
(d) To induce or attem pt to induce a contracted worker without valid
worker already employed to quit his reason as determined by the
employment in order to offer him Department of Labor and Employment;
another unless the transfer is
(l) Failure to reim burse expenses
designed to liberate a worker from
incurred by the worker in connection with
oppressive terms and conditions of
his documentation and processing for
employment;
purposes of deployment, in cases where
(e) To influence or attem pt to influence the deployment does not actually
any person or entity not to employ any take place without the worker's
worker who has not applied for fault. Illegal recruitment when
employment through his agency or committed by a syndicate or in large
who has formed, joined or supported, or scale shall be considered an offense
has contacted or is supported by any involving economic sabotage; and
union or workers' organization;
(m) To allow a non-Filipino citizen to
(f) To engage in the recruitment or head or manage a licensed
placement of workers in jobs harmful recruitment/manning agency.
to public health or morality or to
the dignity of the Republic of the
Philippines; In addition to the acts enumerated above, it
shall also be unlawful for any person or entity
(g) To fail to submit reports on the
to commit the following prohibited acts:
status of employment, placement
vacancies, remittance of foreign (1) Grant a loan to an overseas Filipino
exchange earnings, separation from jobs, worker with interest exceeding eight
departures and such other matters or percent (8%) per annum, which will be
information as may be required by the used for payment of legal and allowable
Secretary of Labor and Employment; placement fees and make the migrant
worker issue, either personally or through
(h) To substitute or alter to the prejudice
a guarantor or accommodation party,
of the worker, employment
postdated checks in relation to the said
contracts approved and verified by the
loan;
Department of Labor and Employment
from the time of actual signing thereof by (2) Impose a compulsory and exclusive
the parties up to and including the period arrangement whereby an overseas
of the expiration of the same without the Filipino worker is required to avail of a
approval of the Department of Labor and loan only from specifically designated
Employment; institutions, entities or persons;
(i) For an officer or agent of a (3) Refuse to condone or renegotiate a loan
recruitment or placement agency incurred by an overseas Filipino worker
to become an officer or member of after the latter's employment contract
the Board of any corporation engaged in has been prematurely terminated
travel agency or to be engaged through no fault of his or her own;
directly or indirectly in the
(4) Impose a compulsory and exclusive
management of travel agency;
arrangement whereby an overseas
(j) To withhold or deny travel Filipino worker is required to undergo
docum ents from applicant workers health examinations only from
before departure for monetary or specifically designated medical clinics,
financial considerations, or for any institutions, entities or persons, except in
other reasons, other than those the case of a seafarer whose medical
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examination cost is shouldered by the his or her salary the payment of the cost
principal/shipowner; of insurance fees, premium or other
insurance related charges, as provided
(5) Impose a compulsory and exclusive
under the compulsory worker's insurance
arrangement whereby an overseas
coverage. [Sec. 6, RA 8042 as amended]
Filipino worker is required to undergo
training, seminar, instruction or schooling
of any kind only from specifically
Migrant W orkers’ Act (MW A) expands
designated institutions, entities or
the definition of illegal recruitment
persons, except for recommendatory
trainings mandated by The amendments to the Labor Code
principals/shipowners where the latter introduced by Republic Act No. 8042,
shoulder the cost of such trainings; otherwise known as the Migrant Workers and
Overseas Filipinos Act of 1995, broadened the
(6) For a suspended recruitment/manning
concept of illegal recruitment and provided
agency to engage in any kind of
stiffer penalties, especially for those that
recruitment activity including the
constitute economic sabotage. [People v.
processing of pending workers'
Ocden, G.R. No. 173198 (2011)]
applications; and
(7) For a recruitment/manning agency or a
foreign principal/employer to pass on the
overseas Filipino worker or deduct from
Three or more complainants must be intent of the accused is not necessary for
in a single case conviction, while estafa is malum in se where
the criminal intent of the accused is crucial
When the Labor Code speaks of illegal
for conviction. Conviction for offenses under
recruitment "committed against three (3) or
the Labor Code does not bar conviction for
more persons individually or as a group," it
offenses punishable by other laws.
must be understood as referring to the
Conversely, conviction for estafa under par.
number of complainants in each case who are
2(a) of Art. 315 of the Revised Penal Code
complainants therein, otherwise,
does not bar a conviction for illegal
prosecutions for single crimes of illegal
recruitment under the Labor Code. It follows
recruitment can be cumulated to make out a
that one's acquittal of the crime of estafa will
case of large scale illegal recruitment.
not necessarily result in his acquittal of the
In other words, a conviction for large scale crime of illegal recruitment in large scale, and
illegal recruitment must be based on a vice versa.” [People v. Ochoa (2011); People v.
finding in each case of illegal recruitment of Ocden (2011)]
three or more persons whether individually or
as a group. [People vs. Reyes, G.R. No.
105204 (1995)] vii. Liabilities
a. Local Recruitment Agency
v. Illegal recruitment as economic Illegal recruitm ent involving local
sabotage workers [Art. 39, LC]
Offense involving Econom ic Sabotage Act Penalty
(Large-Scale or by a Syndicate) Licensee or holder Imprisonment: 2 - 5
Illegal recruitment is considered economic of authority yrs.
sabotage when the commission thereof is violating or causing OR
attended by the ff. qualifying circumstances: another to violate Fine: P10k – P50k
Title I, Book I, LC OR
(1) By a syndicate - if carried out by a Both
group of 3 or more persons conspiring Violating or Imprisonment: 4 - 8
and confederating with one another; causing another to yrs. OR
(2) In large scale - if committed against 3 violate Title I, Book Fine: P20k – P100k
or more persons individually or as a group. I, LC OR
[Art. 38(b), LC] Both
Illegal recruitment Life imprisonment
constituting AND
See iv. Illegal recruitment in large scale for economic sabotage Fine: P100k
requisites and discussion
If the offender is a corporation, partnership,
association or entity, the penalty shall be
vi. Illegal recruitment vs. estafa imposed upon the officer or officers of the
One convicted for illegal recruitm ent corporation, partnership, association or entity
may still be convicted of estafa responsible for violation.
In People v. Cortez the Court explained that: If such officer is an alien, he shall, in addition
“In this jurisdiction, it is settled that a person to the penalties herein prescribed, be
who commits illegal recruitment may be deported without further proceedings.
charged and convicted separately of illegal In every case, conviction shall cause and carry
recruitment under the Labor Code and estafa the automatic revocation of the license
under par. 2(a) of Art. 315 of the Revised or authority and all the perm its and
Penal Code. The offense of illegal recruitment privileges granted to such person or entity
is malum prohibitum where the criminal under this Title, and the forfeiture of the
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cash and surety bonds in favor of the (2) Private employment agencies are
Overseas Employment Development Board or held jointly and severally liable 11
the National Seamen Board, as the case may with the foreign-based employer
be, both of which are authorized to use the for any violation of the recruitment
same exclusively to promote their objectives. agreement or contract of employment.
This joint and solidary liability imposed by
Illegal recruitm ent involving m igrant
law against recruitment agencies and
workers [SEC. 7, RA 8042 AS AMENDED BY
foreign employers is meant to assure the
RA 10022]
aggrieved worker of immediate and
sufficient payment of what is due him
[Becmen Service Exporter vs. Sps.
Act Penalty
Cuaresma, G.R. 182978-79, (2009]
Prohibited Imprisonment: 6 yrs. and 1
(3) If the recruitm ent/placem ent
Act/s day – 12 yrs.
agency is a juridical being, the
AND
corporate officers and directors
Fine: P500k – P1M
and partners as the case m ay be,
Illegal Imprisonment: 12 yrs. and 1 shall themselves be jointly and
recruitment day – 20 yrs. solidarily liable with the corporation
AND or partnership for the aforesaid claims
Fine: P1M – P2M and damages. [Becmen Service Exporter
Illegal Life imprisonment vs. Sps. Cuaresma, G.R. 182978-79,
recruitment AND (2009]
constituting Fine: P2M – P5M
economic (4) Foreign em ployer shall assum e
sabotage Maxim um penalty if: joint and solidary liability with the
1. Illegally recruited person employer for all claims and liabilities
below 18 years old which may arise in connection with the
OR implementation of the contract, including
2. Offense committed but not limited to payment of wages,
without license/authority death and disability compensation and
repatriation
If the offender is an alien, he or she shall, in
addition to the penalties herein prescribed, Common Rules on Illegal Recruitment
be deported without further proceed- (Local or Overseas)
ings.
a. Venue
In every case, conviction shall cause and carry
the automatic revocation of the license A criminal action arising from illegal
or registration of the recruitment/ recruitment shall be filed with the RTC of the
manning agency, lending institutions, province or city:
training school or medical clinic. (1) where the offense was committed or
(2) where the offended party actually
Common Rules on Liability resides at the time of the
commission of the offense. [Sec. 9, R.A.
(1) Employees of a company or 8042 (this part was not amended by R.A.
corporation engaged in illegal 10022)].
recruitment may be held liable as
principal, together with his employer, if it Prescriptive Periods
is shown that he actively and consciously (1) Simple Illegal Recruitment – 5 years
participated in illegal recruitment.
[People vs. Sagayaga, G.R. 143726 (2) Illegal Recruitment involving Economic
(2004)] Sabotage – 20 years [Sec. 12, R.A. 8042
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(this part was not amended by R.A, § all claims and liabilities which may
10022)]. arise in connection with the use of
license;
§ all acts of its officials, employees and
b. Foreign Employer
representatives done in connection with
Foreign em ployer shall assum e joint recruitment and placement;
and solidary liability with the em ployer
(2) Shall assume joint and solidary
for all claims and liabilities which may arise in
liability with the employer for all claims and
connection with the implementation of the
liabilities which may arise in connection with
contract, including but not limited to
the implementation of the contract, including
payment of wages, death and disability
but not limited to payment of wages, death
compensation and repatriation
and disability compensation and repatriation;
(3) Shall guarantee compliance with the
Theory of imputed knowledge existing labor and social legislations of the
Philippines and of the country of employment
This is a doctrine in agency which states that
of recruited workers [POEA Rules, Book II,
the principal is chargeable with and bound by
Rule II, Sec. 1 (f) (2-5)]
the knowledge of or notice to his agent
received while the agent was acting as such.
Simply put, notice to the agent is notice
Purpose of Solidary Liability
to the principal.
The fact that the manning agency and its
Since the local employment agency is
principal have already terminated their
considered the agent of the foreign employer,
agency agreement does not relieve the
the principal, knowledge of the former of
former of its liability. The agency agreement
existing labor and social legislation in the
with the principal even if ended as between
Philippines is binding on the latter.
them, still extends up to and until the
Consequently, notice to the former of any
expiration of, the employment contracts of
violation thereof is notice to the latter.
the employees recruited and employed
However, notice to the principal is not notice pursuant to the said recruitment agreement.
to the agent. The SC held in Sunace Otherwise, this will render nugatory the very
International Management Services, Inc. vs. purpose for which the law governing the
NLRC [G.R. 161757 (2006)] that “the theory of employment of workers for foreign jobs
imputed knowledge ascribes the knowledge abroad was enacted, that is, to assure
of the agent to the principal, not the other aggrieved workers of im mediate and
way around. The knowledge of the sufficient payment of what is due
principal-foreign employer cannot, therefore, them. [OSM Shipping Phil, Inc. v. NLRC
be imputed to its agent.” (2003)]
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§ violation of the provisions of this and other B.3. Remittance of Foreign Exchange
applicable laws, General Orders and Earnings
Letters of Instructions. [Art. 35, LC]
It shall be mandatory for all Filipino workers
Acts prohibited under Article 34 are grounds abroad to remit a portion of their foreign
for suspension or cancellation of license. earnings to their families, dependents,
Note that these acts likewise constitute and/or beneficiaries in the country. [Art. 22,
illegal recruitment under R.A. 8042 as LC]
amended by R.A. 10022.
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[Art. 212 (m), LC] One who is vested with the Managerial Staff also included as they
powers or prerogatives to lay down and are considered managerial employees
execute management policies and/or to hire, as well
transfer, suspend, lay off, recall, discharge,
assign or discipline employees. Supervisory [Book 3, Rule 1, Sec. 2(c), IRR]
employees are those who, in the interest of Officers or members of a managerial staff are
the employer, effectively recommend such also exempted if they perform the following
managerial actions if the exercise of such duties and responsibilities:
authority is not merely routinary or clerical in
nature but requires the use of independent (1) Their primary duty consists of the
judgment. All employees not falling within performance of work directly related to
any of the above definitions are considered management policies of their
rank and file employees for purposes of this employer;
Book. (2) Customarily and regularly exercise
The definition in Art. 82 covers more people discretion and independent judgment;
than that in Article 212 (m) as Article 82 also (3) (a) Regularly and directly assist a
includes managerial staff. In effect, proprietor or a managerial employee
managerial employees in Article 82 includes whose primary duty consists of the
supervisors, but Article 212(m) does not. management of the establishment in
It follows that under Book V, supervisors are which he is employed or subdivision
allowed to form, join or assist a labor union. thereof; OR
Supervisors are not, however, entitled to the (b) Execute under general supervision
benefits under Book III Articles 83 through 96, work along specialized or technical
being part of the exemption of managerial lines requiring special training,
employees as defined in Article 82. [Azucena] experience, or knowledge; OR
(c) Execute, under general supervision,
Characteristics of managerial special assignments and tasks;
employees (4) Who do not devote more than 20% of
[Book 3, Rule 1, Sec. 2(b), IRR] their hours worked in a work week to
activities which are not directly and
Managerial employees are exempted from closely related to the performance of
the coverage of Book III Articles 83 through the work described in paragraphs (1),
96 if they meet all of the following conditions: (2) and (3) above.
(1) Their primary duty consists of the
management of the establishment in
which they are employed or of a
department or sub-division thereof.
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In order to determine whether an employee is Thus, it has been held that the following
a field employee, it is also necessary to personnel are not domestic employees:
ascertain if actual hours of work in the field (1) House personnel hired by a ranking
can be determined with reasonable certainty company official but paid by the company
by the employer. In so doing, an inquiry must itself to maintain a staff house provided
be made as to whether or not the employee’s for the official. [Cadiz v. Philippine Sinter
time and performance are constantly Corp, NLRC Case No. 7-1729, cited by
supervised by the employer. [Far East Azucena]
Agricultural Supply v. Lebatique (2007)]
(2) A family cook, who is later assigned to
work as a watcher and cleaner of the
A.4. DEPENDENT FAMILY MEMBERS employer’s business establishment,
becomes an industrial worker entitled to
Workers who are family members of the receive the wages and benefits flowing
employer, and who are dependent on him for from such status. [Villa v. Zaragosa and
their support, are outside the coverage of this Associates, OP Decision No. 0183, cited by
Title on working conditions and rest periods. Azucena]
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maintenance and enjoyment thereof or less than eight hours [Legend Hotel v. Realuyo,
minister to the personal comfort convenience G.R. 153511 (2012)]
or safety of the employer as well as the
EXCEPTIONS to 8-Hour Law: Work
members of his employer’s household.
Hours of Health Personnel
Health personnel in:
A.7. WORKERS PAID BY RESULT (1) Cities and municipalities with a
[Book 3, Rule 1, Sec. 2 (e), IRR.] population of at least one million
(1,000,000) OR
Workers who are paid by results, including
those who are paid on piece work, “takay,” (2) Hospitals and clinics with a bed
“pakiao” or task basis, and other nontime capacity of at least one hundred (100)
work if their output rates are in accordance shall hold regular office hours for eight
with the standards prescribed under Section (8) hours a day, for five (5) days a week,
8, Rule VII, Book Three of these regulations, exclusive of time for meals, except
or where such rates have been fixed by the where the exigencies of the service
Secretary of Labor and Employment in require that such personnel work for six
accordance with the aforesaid Section. (6) days or forty-eight (48) hours, in
which case, they shall be entitled to an
Workers under piece-rate employment have additional compensation of at least
no fixed salaries and their compensation is thirty percent (30%) of their regular
computed on the basis of accomplished tasks. wage for work on the sixth day.
That their work output might have been
affected by the change in their specific work For purposes of this Article, "health
assignments does not necessarily imply that personnel" shall include resident physicians,
any resulting reduction in pay is tantamount nurses, nutritionists, dietitians, pharmacists,
to constructive dismissal. It is the prerogative social workers, laboratory technicians,
of the management to change their paramedical technicians, psychologists,
assignments or to transfer them. [Best Wear midwives, attendants and all other hospital
Garments v. De Lemos and Ocubillo (2012)] or clinic personnel. [Art. 83, LC]
Medical secretaries are also considered clinic
personnel. [Azucena]
B. HOURS OF WORK
Note: Article 83 of the Labor Code only set a (1) All hours are hours worked which the
maximum of number of hours as "normal employee is required to give his employer,
hours of work" but did not prohibit work of regardless of whether or not such hours
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for overtime pay. [Policy Instruction No. 36, (3) Attendance in hearings in cases filed by
May 22, 1978] the employee is NOT compensable hours
worked.
Note: The time during which an employee is
inactive by reason of work interruptions (4) Participation in strikes is NOT
beyond his control is considered working time, compensable working time.
either if the imminence of the resumption of
work requires the employee’s presence at the
place of work or if the interval is too brief to Idle tim e
be utilized effectively and gainfully in the
The idle time that an employee may spend for
employee’s own interest. [Book III, Rule 1 Sec.
resting and dining which he may leave the
4 (d), IRR]
spot or place of work though not the premises
of his employer, is not counted as working
time only where the work is broken or is not
Necessary W ork After Normal Hours
continuous. [National Development Co. v. CIR
If the work performed was necessary, or it (1962)]
benefited the employer, or the employee
A laborer need not leave the premises of the
could not abandon his work at the end of his
factory, shop or boat in order that his period
normal working hours because he had no
of rest shall not be counted, it being enough
replacement, all the time spent for such work
that he "cease to work", may rest completely
shall be considered as hours worked if the
and leave or may leave at his will the spot
work was with the knowledge of his employer
where he actually stays while working, to go
or immediate supervisor. [Book III, Rule 1, Sec.
somewhere else, whether within or outside
4(c), IRR]
the premises of said factory, shop or boat. If
these requisites are complied with, the period
of such rest shall not be counted. [Luzon
Lectures, meetings, trainings
Stevedoring Co. v. Luzon Marine Department
Attendance at lectures, meetings, training Union (1957)]
programs, and other similar activities shall
not be counted as working time if ALL of the
following conditions are met: Travel time [Department of Labor Manual]
(1) Attendance is outside of the (1) Travel from home to work – An employee
employee’s regular working hours; who travels from home before his regular
workday and returns to his home at the
(2) Attendance is in fact voluntary; and
end of the workday is engaged in ordinary
(3) The employee does not perform any home-to-work travel which is NOT
productive work during such considered hours worked, EXCEPT:
attendance. [IRR, Book III, Rule 1, Sec.
(a) When called to travel during
6]
emergency;
(b) When travel is done through a
Note: conveyance furnished by the
employer;
(1) Attendance in lectures, meetings, and
training periods sanctioned or required by (c) Travel is done under vexing and
the employer are considered hours dangerous circumstances;
worked.
(d) Travel is done under the supervision
(2) Attendance in CBA negotiations or and control of the employer.
grievance meeting is compensable hours
(2) Travel that is all in the day’s work – Time
worked.
spent by an employee in travel from
jobsite to jobsite during the workday,
must be counted as hours worked. Where
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Flexi-holidays
Effects of CW W
The employees agree to avail the holidays at
(1) Unless there is a more favorable practice
some other days provided there is no
existing in the firm, work beyond eight
diminution of existing benefits as a result of
hours will not be compensable by
such arrangement.
overtime premium provided the total
number of hours worked per day shall not
Compressed W ork W eek (CW W ) exceed twelve (12) hours. In any case, any
work performed beyond 12 hours a day or
[DOLE Advisory No. 02, Series of 2004] 48 hours a week shall be subject to
Under the CWW scheme, the normal workday overtime premium.
goes beyond eight hours without the (2) Consistent with Art. 85 of the LC,
corresponding overtime premium. employees under a CWW scheme are
The total hours of work, however, shall not entitled to meal periods of not less than
exceed 12 hours a day or 48 hours a week, or 60 minutes. There shall be no
the employer is obliged to pay the worker the impairment of the right of the employees
overtime premium in excess of said work to rest days as well as to holiday pay, rest
hours. day pay or leaves in accordance with law
or applicable collective bargaining
agreement or company practice.
Conditions for CW W (3) Adoption of the CWW scheme shall in no
(1) The CWW scheme is undertaken as a case result in diminution of existing
result of an express and voluntary benefits. Reversion to the normal eight-
agreement of majority of the covered hour workday shall not constitute a
employees or their duly authorized diminution of benefits.
representatives. This agreement may be Rationale
expressed through collective bargaining
or other legitimate workplace Although the right to overtime pay cannot be
mechanisms of participation such as waived as per Cruz v. Yee Sing (1959), D.O. No.
labor management councils, employee 21 sanctions the waiver of overtime pay in
assemblies or referenda. consideration of the benefits that the
employees will derive from the adoption of a
(2) In firms using substances, chemicals and compressed workweek scheme, thus:
processes or operating under conditions
where there are airborne contaminants, The compressed workweek scheme was
human carcinogens or noise prolonged originally conceived for establishments
exposure to which may pose hazards to wishing to save on energy costs, promote
employees’ health and safety, there must greater work efficiency and lower the rate of
be a certification from an accredited employee absenteeism, among others.
health and safety organization or Workers favor the scheme considering that it
would mean savings on the increasing cost of
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transportation fares for at least one (1) day a (4) Where the work is necessary to prevent
week; savings on meal and snack expenses; serious loss of perishable goods [Book
longer weekends, or an additional 52 off-days 3, Rule 1, Sec. 7 par 1, IRR]
a year, that can be devoted to rest, leisure,
Employees are not prohibited from going out
family responsibilities, studies and other
of the premises as long as they return to their
personal matters, and that it will spare them
posts on time. Nowhere in the law may it be
for at least another day in a week from certain
inferred that employees must take their
inconveniences that are the normal incidents
meals within the company premises.
of employment, such as commuting to and
[Philippine Airlines v. NLRC (1999)]
from the workplace, travel time spent,
exposure to dust and motor vehicle fumes,
dressing up for work, etc. Thus, under this
SYNTHESIS OF THE RULES
scheme, the generally observed workweek of
six (6) days is shortened to five (5) days but General Rule: Meal periods are NOT
prolonging the working hours from Monday compensable.
to Friday without the employer being obliged Exception:
for pay overtime premium compensation for
work performed in excess of eight (8) hours It becomes compensable:
on weekdays, in exchange for the benefits (1) Where the lunch period or meal time is
above cited that will accrue to the employees. predominantly spent for the employer’s
[Bisig Manggagawa sa Tryco v. NLRC, et al. benefit. [Azucena citing 31 Am. Jur. 881;
(2008)] Duka, Labor Laws and Social Legislation]
(2) Meal periods of 1 hour are deemed
B.3. MEAL BREAK compensable when the employee is on
continuous shift. [National Development
General Rule: Subject to such regulations Co. v. CIR, G.R. No. L-15422, (1962)]
as the Secretary of Labor may prescribe, it
shall be the duty of every employer to give his (3) Shortened meal period of less than 1 hour
employees not less than sixty (60) minutes (say, 30 minutes) must be compensable.
time-off for their regular meals (Art. 85, LC) (Sec. 7, Rule I, Book III, IRR)
Exceptions: Note: To shorten meal time to less than 20
minutes is not allowed. If the so-called meal
Employees may be given a meal period of not time is less than 20 minutes, it becomes only
less than twenty (20) minutes provided that a REST PERIOD and is considered working
such shorter meal period is credited as time.
compensable hours worked of the employee:
Exception to the Exception: Shortened
(1) Where the work is non-manual work in meal breaks upon the employees’ request –
nature or does not involve strenuous NOT compensable.
physical exertion;
The employees themselves may request that
(2) Where the establishment regularly the meal period be shortened so that they
operates not less than sixteen (16) can leave work earlier than the previously
hours a day; established schedule. [Drilon: Letter to Kodak
(3) In case of actual or impending Philippines, Nov. 27, 1989; also Cilindro: BWC-
emergencies or there is urgent work to WHSD Opinion No. 197, s. 1998]
be performed on machineries,
equipment or installations to avoid
serious loss which the employer would Conditions for shortened m eal breaks
otherwise suffer; upon em ployee’s request.
OR (1) The employees voluntarily agree in
writing to a shortened meal period of 30
minutes and are willing to waive the
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overtime pay for such shortened meal controlling factor is whether waiting time
period; spent in idleness is so spent predominantly
for the employer’s benefit or for the
(2) There will be no diminution whatsoever in
employee’s. [Azucena, citing Armour v.
the salary and other fringe benefits of the
Wantock]
employees existing before the effectivity
of the shortened meal period;
(3) The work of the employees does not B.5. OVERTIME WORK, OVERTIME PAY
involve strenuous physical exertion and
Overtime compensation is additional pay for
they are provided with adequate “coffee
service or work rendered or performed in
breaks” in the morning and afternoon.
excess of eight hours a day by employees or
(4) The value of the benefits derived by the laborers covered by the Eight-hour Labor Law.
employees from the proposed work [National Shipyard and Steel Corp. v. CIR
arrangement is equal to or (1961)]
commensurate with the compensation
Rationale
due them for the shortened meal period
as well as the overtime pay for 30 There can be no other reason than that he is
minutes as determined by the employees made to work longer than what is
concerned; commensurate with his agreed compensation
for the statutorily fixed or voluntary agreed
(5) The overtime pay of the employees will
hours of labor he is supposed to do. [PNB v.
become due and demandable if ever they
PEMA (1982)]
are permitted or made beyond 4:30pm;
and
(6) The effectivity of the proposed working Overtim e on ordinary working day
time arrangement shall be of temporary
Art. 87, LC. Work may be performed beyond
duration as determined by the Secretary
eight (8) hours a day provided that the
of Labor.
employee is paid for the overtime work, an
additional compensation equivalent to his
regular wage plus at least twenty five percent
B.4. WAITING TIME
(25%) thereof.
[Book III, Rule I Sec. 5(a), IRR]
Waiting time spent by an employee shall be
Overtim e work on holiday or rest day
considered as working time if waiting is an
integral part of his work or the employee is Art. 87, LC. Work performed beyond eight
required or engaged by the employer to wait. hours on a holiday or rest day shall be paid an
additional compensation equivalent to the
rate of the first eight hours on a holiday or
[Book 3, Rule 1, Sec. 5(b), IRR] rest day plus at least thirty percent (30%)
thereof.
An employee who is required to remain on
call in the employer’s premises or so close
thereto that he cannot use the time
Computation of additional
effectively and gainfully for his own purpose
compensation
shall be considered as working while on call.
Art. 90, LC. For purposes of computing
overtime and other additional remuneration
Legal test: Whether waiting time as required by this Chapter the "regular
constitutes working time depends upon the wage" of an employee shall include the cash
circumstances of each particular case. The wage only without deduction on account of
facts may show that the employer was facilities provided by the employer.
engaged or was waiting to be engaged. The
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Base of Computation: Regular wage – When the tour of duty of a laborer falls at
means regular base pay; it excludes money nighttime [between 10:00pm and 6:00am],
received in different concepts such as the receipt of overtime pay will not preclude
Christmas bonus and other fringe benefits. the right to night differential pay. The latter is
[Bisig ng Manggagawa ng Philippine Refining payment for work done during the night while
Co. v. Philippine Refining Co , G.R. L-27761 the other is payment for the excess of the
(1981)] regular eight-hour work. [Naric v. Naric
Workers Union (1959)]
BUT when the overtime work was performed
on the employee’s rest day or on special days
or regular holidays (Art. 93 and 94), the
SYNTHESIS OF RULES
premium pay, must be included in the
computation of the overtime pay. (1) An employer cannot compel an employee
to work overtime
[See: p. 19 of Handbook on Workers’
Statutory Monetary Benefits, issued by the Exception: Emergency overtime
Bureau of Working Conditions, 2006] work as provided for in Art. 89
(2) Additional compensation is demandable
only if the employer had knowledge and
Emergency overtime [Art. 89, LC]
consented to the overtime work rendered
Any employee may be required by the by the employee.
employer to perform overtime work in any of
Exception: Express approval by a
the following cases:
superior NOT a requisite to make
(1) When the country is at war or when any overtime compensable:
other national or local emergency has
(a) If the work performed is necessary,
been declared by the National Assembly
or that it benefited the company;
or the Chief Executive;
or
(2) When it is necessary to prevent loss of life
(b) That the employee could not
or property or in case of imminent danger
abandon his work at the end of
to public safety due to an actual or
his eight-hour work because there
impending emergency in the locality
was no substitute ready to take
caused by serious accidents, fire, flood,
his place. [Manila Railroad Co. v.
typhoon, earthquake, epidemic, or other
CIR, G.R. L-4614 (1952)]
disaster or calamity;
Note: However, the Court has also
(3) When there is urgent work to be
ruled that a claim for overtime pay is
performed on machines, installations, or
NOT justified in the absence of a
equipment, in order to avoid serious loss
written authority to render overtime
or damage to the employer or some other
after office hours during Sundays and
cause of similar nature;
holidays. [Global Incorporated v.
(4) When the work is necessary to prevent Atienza, G.R. L-51612-13 (1986)]
loss or damage to perishable goods; and
(3) Compensation for work rendered in
(5) Where the completion or continuation of excess of the 8 normal working hours in
the work started before the eighth hour is a day.
necessary to prevent serious obstruction
(a) For ordinary days, additional 25%
or prejudice to the business or operations
of the basic hourly rate.
of the employer.
(b) For rest day/special day/holiday,
additional 30% of the basic
Overtim e pay does not preclude night hourly rate.
differential pay
(4) A given day is considered an ordinary
day, unless it is a rest day.
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(5) Undertim e does NOT offset B.6. NIGHT WORK, NIGHT SHIFT
overtim e. Undertime work on any DIFFERENTIAL
particular day shall not be offset by
Night worker
overtime work on any other day.
Permission given to the employee to go Any employed person whose work requires
on leave on some other day of the week performance of a substantial number of
shall NOT exempt the employer from hours of night work which exceed a specified
paying the additional compensation limit. This limit shall be fixed by the Sec of
required in this Chapter. [Art. 88, LC] Labor after consulting the workers’
representatives/labor organizations and
employers. [Art. 154, LC as amended by RA
No W aiver of Overtime Pay 10151]
The right to overtime pay cannot be waived. Any employed person whose work covers the
The Labor Code (Art. 87) requires that an period from 10 o’clock in the evening to 6
employee be paid all overtime compensation o’clock the following morning, provided that
notwithstanding any agreement to work for a the worker performs no less than 7
lesser wage. Consequently, such an consecutive hours of work. [Book III, Rule XV,
agreement or "waiver" will not prevent an Sec. 2, IRR, through DO 119-12]
employee from recovering the difference
between the wages paid the employee and
the overtime compensation he or she is Health Assessm ent
entitled to receive. [Cruz v. Yee Sing, G.R. L-
At the worker’s request, they shall have the
12046 (1959)]
right to undergo a health assessment without
Exception: When the waiver of overtime pay charge and to receive advice on how to
is in consideration of benefits and privileges reduce or avoid health problems associated
which may be more than what will accrue to with their work:
them in overtime pay, the waiver MAY be
(a) Before taking up an assignment as a
permitted. [Meralco Workers Union v.
night worker;
MERALCO, G.R. L-11876 (1959)]
(b) At regular intervals during such an
assignment;
Composite or Package Pay NOT per se
(c) If they experience health problems during
illegal
such an assignment;
Composite or “package pay” or “all-inclusive
With the exception of a finding of unfitness
salary” is an arrangement where the
for night work, the findings of such
employee’s salary includes the overtime pay.
assessments shall be confidential and shall
In other words, the overtime pay is “built-in”.
NOT be used to their detriment, subject,
Two conditions for validity of such however, to applicable company policies. [Art.
arrangement: 155, LC as amended by RA 10151; Book III, Rule
XV, Sec. 3, IRR, through DO 119-12]
(1) There is a clear written agreement
knowingly and freely entered by the
employee; and
Mandatory Facilities
(2) The mathematical result shows that the
Mandatory facilities shall be made available
agreed legal wage rate and the overtime
for workers performing night work, which
pay, computed separately, are equal to or
include the following:
higher than the separate amounts legally
due. [Damasco v. NLRC, G.R. 115755 (a) Suitable first-aid and emergency facilities
(2000)] (b) Lactation station in required companies
pursuant to RA 10028
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(c) Separate toilet facilities for men & dismissal or notice of dismissal as
women other workers who are prevented
from working for health reasons. [Art.
(d) Facility for eating w/ potable drinking
157, LC as amended by RA 10151; Book
water; AND
III, Rule XV, Sec. 5, IRR, through DO
(e) Facilities for transportation and/or 119-12]
properly ventilated temporary sleeping or
resting quarters, separate for male and
female workers, shall be provided except W omen Night W orkers
where any of the ff. circumstances is
Employers shall ensure that measures shall
present:
be taken to ensure that an alternative to
i. There is an existing company night work for pregnant and nursing
guideline, practice or policy, CBA, employees who would otherwise be called
or any similar agreement upon to perform such work. Such measures
providing for an equivalent or may include:
superior benefit; or
(1) Transfer to day work – As far as
ii. Start or end of the night work practicable, pregnant or nursing
does NOT fall within 12 mn - 5 employees shall be assigned to day work,
am; or before and after childbirth, for a period of
at least sixteen (16) weeks, which shall be
iii. Workplace is located in an area
divided between the time before and after
that is accessible 24 hours to
childbirth;
public transportation; or
Medical certificate issued by competent
iv. Number of employees does NOT
physician (OB/Gyne/Pedia) is necessary
exceed a specified number as
for the grant of:
may be provided for by the SOLE
in subsequent issuances [Art. 156, (a) additional periods of assignment to
LC as amended by RA 10151; Book day work during pregnancy or after
III, Rule XV, Sec. 4, IRR, through childbirth, provided that such shall
DO 119-12] not be more than 4 weeks or for a
longer period as may be agreed upon
Transfer
by employer and worker;
If night worker is unfit for night work due to
(b) extension of maternity leave; and
health reasons as certified by competent
physician, s/he shall be: (c) clearance to render night work.
(1) Transferred in good faith to a job for (2) Provision of social security benefits - in
which they are fit to work whenever accordance with provisions of Act No
practicable, which must be similar 8282 (Social Security Act of 1997) and
and equivalent position; other existing company policy or
collective bargaining agreement.
(2) If transfer is not practicable, or
workers are unable to render night (3) Extension of maternity leave – where
work for a continuous period of not transfer to day work is not possible, but
less than 6 months upon certification requires recommendation by competent
of a competent public health physician; without pay or using earned
authority, they shall be granted the leave credits, if any [Art. 158, LC, as
same benefits as other workers who amended by RA 10151; Book III, Rule XV,
are unable to work due to illness. Sec. 6, IRR, through DO 119-12]
(3) If workers are certified as temporarily
unfit to render night work for a period
of less than 6 months, they shall be
given the same protection against
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C. WAGES Coverage/Exclusions
Wage includes the fair and reasonable value
Definition of facilities furnished by the employer to the
employee [Art. 97(f)] while allowances are
(a) It is the remuneration or earnings, excluded from the basic salary or wage
however designated, capable of being computation. [Cebu Institute of Technology v
expressed in terms of money, Ople (1987)]
(b) Whether fixed or ascertained on a time,
task, piece, or commission basis, or
other method of calculating the same, Applicability
(c) Which is payable by an employer to an The Labor Code Title on wages shall not
employee apply to the following [Art. 98 and Book 3,
Rule VII, Sec 3, IRR]:
(d) Under a written or unwritten contract of
employment for work done or to be done, (1) Farm tenancy or leasehold;
or for services rendered or to be (2) Household or domestic helpers,
rendered and including family drivers and other
(e) Includes the fair and reasonable value, persons in the personal service of
as determined by the Secretary of Labor another;
and Employment, of board, lodging, or (3) Homeworkers engaged in needlework;
other facilities customarily furnished by
the employer to the employee (4) Workers in registered cottage industries
who actually work at home;
Fair and reasonable value - shall not include
any profit to the employer, or to any person (5) Workers in registered cooperatives
affiliated with the employer. [Art. 97(f), LC] when so recommended by the Bureau
of Cooperative Development upon
approval of the Secretary of Labor;
“No work no pay” Principle
General Rule: the age old rule governing Note: Workers in registered barangay micro
the relation between labor and capital or business enterprise are only exempted from
management and employee is that a "fair the Minimum Wage Law, not from the Title
day's wage for a fair day's labor." [Sugue v. on Wages [RA 9178].
Triumph International (2009)]
Exception: When the laborer was able,
willing and ready to work but was illegally C.1. WAGE VS. SALARY
locked out, suspended or dismissed, or Wages and salary are in essence synonymous.
otherwise illegally prevented from working. [Songco v. NLRC (1990)]
[Sugue v Triumph International, supra]
There are slight differences:
Employees working in the Philippines, if they Paid for skilled or Paid to white collar
are performing similar functions and unskilled manual workers and denote a
responsibilities under similar working labor higher grade of
conditions should be paid equally. If an employment
employer accords employees the same Not subject to Not exempt from
position and rank, the presumption is that execution, execution,
these employees perform equal work. garnishment or garnishment or
[International School Alliance of Educators v. attachment except for attachment [Gaa vs.
Hon. Quisumbing (2000)] debts related to CA, 1985]
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Procedure for W age Fixing by (1) Preferably through time and motion
Regional Board (Art. 123, LC) studies.
(1) Investigate and study pertinent facts, (2) Consultation with representatives of
based on criteria set in Art. 124 ERs’ and workers’ organizations in a
tripartite conference called by the
(2) Conduct public hearings or consultations
DOLE Sec.
with notice to employer and employee
groups, provinces, city, municipal officials Request for the conduct of time and motion
and other interested parties studies, to determine whether the non-time
employees in an enterprise are being paid fair
(3) Decide to ISSUE or NOT TO ISSUE a wage
and reasonable wage rates, may be filed with
order
the proper Regional Office.
§ Frequency: Wage orders issued may
Where the output rates established by the
not be disturbed for 12 months from
employer do not conform to the standards set
effective date; this serves as a bar for
under the foregoing methods for establishing
petitions for wage hikes as well
output rates, the employee shall be entitled
§ Except: when Congress passes a to the difference between the amount he/she
new law affecting wages or other is entitled to receive and the amount paid by
supervening circumstances the employer.
§ Effectivity: If it decides to ISSUE a
wage order, the wage order takes
C.3.II MINIMUM W AGE OF
effect after 15 days from complete
APPRENTICES AND LEARNERS
publication in at least 1 newspaper of
general circulation in the region Wages of apprentices and learners shall in no
case be less than 75% of the applicable
(4) Appeal wage order to Commission within
minimum wage rates. [Art. 61 & 75, LC]
10 calendar days; mandatory for the
Commission to decide within 60 calendar Note: Learners employed in piece or
days from filing incentive-rate jobs during the training period
shall be paid in full for the work done. [Art. 76,
Note: Filing of an appeal does not stay
LC]
order unless appellant files an undertaking
with a surety, to guarantee payment of The Secretary of Labor and Employment may
employees if the wage order is affirmed (as authorize the hiring of apprentices without
amended by RA 6727) compensation whose training on the job is
required by the school or training program
curriculum or as requisite for graduation or
C.3. MINIMUM WAGE OF WORKERS PAID board examination. [Art. 72, LC]
BY RESULTS
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Prohibition seeks to protect the employee (1) Mistake in the application of the law
against unwarranted practices that would [Globe Mackay Cable v. NLRC, June 29,
diminish his compensation without his 1988]
knowledge and consent. [Radio
(2) Negotiated benefits [Azucena]
Communication of the Phil., Inc. v. Sec. of
Labor (1989)] (3) Reclassification of Positions – e.g.
loss of some benefits by promotion.
Note: Persons earning minimum wage are
exempted from income tax (4) Contingent or Conditional Benefits –
the rule does not apply to a benefit
“That minimum wage earners as defined in
whose grant depends on the
Section 22(HH) of this Code shall be exempt
existence of certain conditions, so
from the payment of income tax on their
that the benefit is not demandable if
taxable income: Provided, further, That the
those preconditions are absent.
holiday pay, overtime pay, night shift
differential pay and hazard pay received by Benefits initiated through negotiation
such minimum wage earners shall likewise be between Employee and Employer, e.g. CBA,
exempt from income tax.” [RA 9504, Sec. 2 can only be eliminated or diminished
redefining sec. 24(A) of RA 8424] bilaterally.
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Facilities Supplements
4 Elements of wage distortion
What it is
(a) Existing hierarchy of positions with
Articles or Extra remuneration or corresponding salary rates;
services/items of special benefits /
expense articles or services / (b) A significant change in the salary rate
tools of the trade of a lower pay class without a
concomitant increase in the salary rate
Who Benefits of a higher one;
For the benefit of the For the benefit or (c) The elimination of the distinction
employee and his convenience of the between the two levels; and
family; for their employer
existence and (d) The existence of the distortion in the
subsistence same region of the country. [Prubankers
Assn. v. Prudential Bank and Co. (1999)]
Deductible from Wage
YES - Part of wage so NO - Independent of
it is deductible the Wage so not How to Resolve [LC Art. 124]
deductible
Organized Establishm ent
(1) Employer and the union shall negotiate
Requirements for deducting value of to correct the distortions.
facilities
(2) Disputes shall be resolved through the
Mere availment is not sufficient to allow grievance procedure.
deductions from employees’ wages. Before
the value of facilities can be deducted from (3) If still unresolved, voluntary arbitration.
the employees’ wages, the following Grievance Procedure (under the CBA) à if
requisites must all be attendant: unresolved, VOLUNTARY arbitration
(1) Proof must be shown that such
facilities are customarily furnished by
the trade; Unorganized Establishment
(2) The provision of deductible facilities (1) ERs and Employees shall endeavor to
must be voluntarily accepted in correct such distortions.
writing by the employee; and (2) Disputes shall be settled through the
(3) Facilities must be charged at National Conciliation and Mediation
reasonable value. Board.
[SLL International Cable Specialists v. NLRC, (3) If still unresolved after 10 calendar days
2011] of conciliation, it shall be referred to the
appropriate branch of the NLRC –
compulsory arbitration
C.8. WAGE DISTORTION/RECTIFICATION § Both the employer and employee
A situation where an increase in prescribed cannot use economic weapons.
wage rates results in the elimination or severe (4) Employer cannot declare a lock-out;
contraction of intentional quantitative Employee cannot declare a strike
differences in wage or salary rates between because the law has provided for a
and among employee groups in an procedure for settling
establishment as to effectively obliterate the
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(5) The salary or wage differential does not the employer has no right to deduct the
need to be maintained. [National proportionate amount corresponding to the
Federation of Labor v. NLRC, 1994] days when no work was done. The monthly
compensation is evidently intended precisely
National Conciliation and Mediation Board à
to avoid computations and adjustments
if unresolved, COMPULSORY arbitration by
resulting from the contingencies just
the NLRC
mentioned which are routinely made in the
case of workers paid on daily basis.
(Wellington Investment Inc. v. Trajano, 1995)
CBA vis-à-vis W age Orders – CBA
creditability
In determining an employee’s regular wage, For daily-paid EEs
the pertinent stipulations in the CBA are
Daily-paid employees are those who are paid
controlling, provided the result is not less
on the days actually worked and on unworked
than the statutory requirement (Philippine
regular holidays.
National Bank vs. PEMA, 1982)
(1) For those who are required to work every
Note: The manner of resolving wage
day including Sundays or rest days,
distortion is largely based on the applicable
special days and regular holidays:
wage order. The current one for NCR, WO 20,
refers to the procedure in Art. 124 of the 394.1 days/year
Labor Code
296 days ordinary working
20 days 10 regular holidays x 200%
C.9. DIVISOR TO DETERMINE DAILY RATE
52 rest days x 130 %
Suggested formula for computing the
67.60 days 7 special days x 130%
Estimated Equivalent Monthly Rate (EEMR)
EEMR = (Applicable Daily Rate (ADR)
x days/year) ÷ 12 9.1 days
(2) For those who do not work and are not
considered paid on Sundays or rest days:
For m onthly-paid EEs
313 days/year
Monthly-paid employees are those who are
paid every day of the month, including 296 days ordinary working
unworked rest days, special days, and regular
12 days regular holidays
holidays.
5 days special days (if considered
365 days/year
paid; if actually worked, this
296 days ordinary working days is equivalent to 6.5 days)
52 days rest days (3) For those who do not work and are not
considered paid on Saturdays and
10 days regular holidays
Sundays or rest days:
7 days special days
278 days/year
Note: This monthly salary shall serve as
261 days ordinary working days
compensation "for all days in the month
whether worked or not," and "irrespective of 10 days regular holidays
the number of working days therein." In the
7 days special days (if considered
event of the declaration of any special holiday,
paid; if actually worked, this
or any fortuitous cause precluding work on
is equivalent to 6.5 days)
any particular day or days the employee is
entitled to the salary for the entire month and [Sec. 6, Rules Implementing RA 6727, 1989]
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P.D. 1083 (Code of Muslim Personal Laws) General Rule: An employer may require an
employee to work on any holiday but such
SEE: Arts. 169-173
employee shall be paid a compensation
Specifically for the Muslim Areas, P.D. 1083, equivalent to twice his regular rate. [Art.
in its Book V, Title, recognizes five (5) Muslim 94(b)]
Holidays, namely:
(1) Amun Jadid (New Year) which falls on the
According to the LC, IRR and Memo:
first (1st) day of the lunar month of
Muharram; Work on any regular
(2) Mauli-un-Nabi (Birthday of the Prophet holiday, not exceeding Computation
Muhammad) which falls on the twelfth 8 hours
(12th) day of the third (3rd) lunar month Work on any regular 200% of regular daily
of Rabi-ul-Awwal; holiday, if it exceeds 8 wage (for the 1st 8
hours/overtime hours)
(3) Lailatul Isra Wal Mi Rai (Nocturnal
+ 30% of hourly rate
Journey and Ascencion of the Prophet
on said day
Muhammand) which falls on the twenty-
seventh (27th) day of the seventh (7th) Work on any regular 200% of regular daily
lunar month of Rajab; holiday which falls on wage + 30% of such
the scheduled rest amount
(4) Id-ul-Fitr (Hari Raja Pausa) which falls on
day, not exceeding 8
the first (1st) day of the tenth (10th) lunar
hours
month of Shawwal commemorating the
end of the fasting season; and Work on any regular Regular holiday-on-
holiday which falls on rest day rate (200% of
(5) Id-ul-Adha (Hari Raha Haji) which falls on scheduled rest day, if regular daily wage
the tenth (10th) day of the twelfth (12th) it exceeds 8 plus 30% of such
lunar month of Dhu’l-Hijja. hours/overtime amount) + 30% of
hourly rate on said
day.
Note: Id-ul-Fitr (Eid’l Fitr) and Id-ul-Adha
(Eid’l Adha) have been added to the list of Work on special Regular daily wage +
national legal holidays. holiday not exceeding 30% thereof
8 hours
Work on special Regular daily wage +
Note: There should be no distinction holiday 50% thereof
between Muslims & non-Muslims as regards
to the payment of benefits for Muslim
holidays. Wages & other emoluments granted According to DOLE Mem o Circular 1-
bylaw to the workingman are determined on 04, a “special holiday”/”special day”
the basis of the criteria laid down by laws & includes the National Special Days, and
not on worker’s faith. Art. 3(3), PD 1083 states declared special days such as Special Non-
that nothing herein shall be construed to working Holiday, Special Public Holiday and
operate to the prejudice of a non-Muslim. Special National Holiday. Such days are
[San Miguel Corp vs. CA (2002)] entitled to the rates prescribed above. These
days are not the same as a special working
holiday.
Holiday pay com putation (Art. 94 Labor
Code, Book III, Rule IV of IRR, RA 9424 and
DOLE Memorandum Circular 1 Series of A special working holiday is considered
2004) an ordinary working day, so there is no
premium pay.
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(1) Monthly paid employees are not (1) When a holiday falls on a Sunday, the
entitled to the holiday pay if their total following Monday will not be considered
annual income is divided by 365 days a holiday unless a proclamation says so.
resulting in a wage which is beyond the (2) Furthermore as stated in the Wellington
minimum wage per day because they case (see below), a legal holiday falling
are considered paid everyday of the on a Sunday does not create a legal
year including holidays, rest days, and obligation to pay extra, aside from the
other non-working days. The 365 days usual holiday pay, to monthly-paid
are as follows: employees. [Azucena citing Letter of
(a) 296 days – ordinary days Instruction No. 1087]
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No provision of law requires any employer to entitled to holiday pay unless he works on
make adjustments in the monthly salary rate such regular holiday.
set by him to take account of legal holidays
falling on Sundays in a given year, otherwise
to reckon a year at more than 365 days. In case of tem porary cessation of work
[Wellington Investment and Manufacturing
(1) In cases of temporary or periodic
Corporation vs. Trajano (1995)]
shutdown and temporary cessation of
work of an establishment, as when a
yearly inventory or when the repair or
Non-working/scheduled rest day
cleaning of machineries and equipment is
Where the day immediately preceding the undertaken, the regular holidays falling
holiday is a non-working day in the within the periods shall be compensated
establishment or the scheduled rest day of in accordance with this Rule.
the employee, he shall not be deemed to be
(2) The regular holiday during the cessation
on leave of absence on that day, in which
of operation of an enterprise due to
case he shall be entitled to the holiday pay if
business reverses as authorized by the
he worked on the day immediately preceding
Secretary of Labor may not be paid by the
the non-working day or rest day. [Book III,
employer. [Book III, Rule IV, Sec 7, IRR]
Rule IV, Sec 6 (c), IRR]
An employee is entitled to holiday pay for the
Example:
regular holidays falling within the period in
If a holiday falls on Monday, and Sunday is a cases of temporary shutdowns or cessation of
non-working day in the establishment or is work, when:
the scheduled rest day of the employee, the
(1) An annual inventory; or
employee shall be entitled to holiday pay if he
worked on Saturday (which is the day (2) Repair or cleaning of machineries and
immediately preceding Sunday, the non- equipment is undertaken.
working day or rest day).
The employer may not pay his employees for
the regular holidays during the suspension of
work if: the cessation of operation is due to
Right to holiday pay in case of
business reverses, and is authorized by the
absences
Secretary of Labor.
All covered employees shall be entitled to the
benefit provided herein when they are on
leave of absence with pay. E.2. TEACHERS, PIECE WORKERS,
SEAFARERS, SEASONAL WORKERS, ETC.
Employees who are on leave of absence
without pay on the day immediately (1) Private school teachers, including faculty
preceding a regular holiday may not be paid members of colleges and universities,
the required holiday pay if he has not worked may not be paid for the regular holidays
on such regular holiday. [Book III, Rule IV, Sec during semestral vacations. They shall,
6(a), IRR] however, be paid for the regular holidays
during Christmas vacation;
(2) Where a covered employee, is paid by
Note:
results or output, such as payment on
(1) If an employee is on leave of absence piece work, his holiday pay shall not be
with pay on the day immediately less than his average daily earnings for
preceding a regular holiday, he is entitled the last seven (7) actual working days
to holiday pay. preceding the regular holiday; Provided,
However, that in no case shall the holiday
(2) If an employee is on leave of absence
pay be less than the applicable statutory
without pay on the day immediately
minimum wage rate.
preceding a regular holiday, he is not
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(3) Seasonal workers may not be paid the holidays are known to both the school
required holiday pay during off-season and faculty members as “no class day”;
when they are not at work certainly the latter do not expect
payment for said unworked holidays.
(4) Workers who have no regular working
days shall be entitled to the benefits (2) They are entitled to their hourly rate on
provided in this Rule. [Book III, Rule IV, days declared as special holidays.
Sec. 8, IRR] When a special public holiday is
declared, the faculty member paid by
the hour is deprived of expected
Holiday Pay of Hourly-Paid Faculty income, and it does not matter that the
Mem bers school calendar is extended in view of
the days or hours lost, for their income
(1) They are not entitled to payment of
that could be earned from other
holiday pay because they are paid only
sources is lost during
for work actually done. Since regular
(3) the extended days.
(4) Similarly, when classes are called off or Premium Pay
shortened on account of typhoons,
Premium pay refers to the additional
floods, rallies, and the like, these
compensation for work performed within 8
faculty members must likewise be paid,
hours on non-work days, such as rest days
whether or not extensions are ordered.
and special days.
[Jose Rizal College v. NLRC, (1987)]
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In case of miscarriage, prior application for (3) Spouse is detained or is serving sentence
paternity leave shall not be required. [Sec. 4, for a criminal conviction for at least one
IRR, RA 8187] (1) year;
(4) Physical and/or mental incapacity of
spouse as certified by a public medical
Non-conversion to cash
practitioner;
In the event that the paternity leave is not
(5) Legal separation or de facto separation
availed of, it shall not be convertible
from spouse for at least one (1) year:
to cash and shall not be cumulative. [Sec. 7,
Provided, that he/she is entrusted with
IRR, RA 8187]
the custody of the children;
(6) Declaration of nullity or annulment of
Crediting of existing benefits marriage as decreed by a court or by a
church: Provided, that he/she is
(1) If the existing paternity leave benefit
entrusted with the custody of the
under the CBA, contract, or company
children;
policy is greater than 7 calendar days as
provided for in RA 8187, the greater (7) Abandonment of spouse for at least one
benefit shall prevail. (1) year;
(2) If the existing paternity leave benefit is (8) Unmarried father/mother who has
less than that provided in RA 8187, the preferred to keep and rear his/her
ER shall adjust the existing benefit to child/children, instead of having others
cover the difference. [Sec. 9, IRR, RA 8187] care for them or give them up to a welfare
institution;
Where a company policy, contract, or CBA
provides for an emergency or contingency (9) Any other person who solely provides
leave without specific provisions on paternity parental care and support to a child or
leave, the ER shall grant to the employee 7 children: Provided, that he/she is duly
calendar days of paternity leave. [Sec. 9, IRR, licensed as a foster parent by the
RA 8187] Department of Social Welfare and
Development (DSWD) or duly appointed
legal guardian by the court; and
F.4. PARENTAL LEAVE
(10) Any family member who assumes the
[RA 8972 (Solo Parents’ Welfare Act of 2000)] responsibility of head of family as a result
Leave benefits granted to a solo parent to of the death, abandonment,
enable him/her to perform parental duties disappearance, or prolonged absence of
and responsibilities where physical presence the parents or solo parent for at least one
is required. [Sec. 3 (d), RA 8972] (1) year. [Sec. 3 (a), RA 8972]
Any solo parent or individual who is left alone A solo parent employee shall be entitled to
with the responsibility of parenthood due to: the parental leave under the following
conditions:
(1) Giving birth as a result of rape or and
other crimes against chastity even (1) He/she has rendered at least one (1) year
without a final conviction of the offender: of service, whether continuous or broken;
Provided, That the mother keeps and (2) He/she has notified his/her employer
raises the child; that he/she will avail himself/herself of it,
(2) Death of spouse; within a reasonable period of time; and
(3) He/she has presented to his/her
employer a Solo Parent Identification
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Card, which may be obtained from the F.5. LEAVES FOR VICTIMS OF VIOLENCE
DSWD office of the city or municipality AGAINST WOMEN
where he/she resides. [Sec 19, Art. V, IRR,
[RA 9262 (Anti-Violence against Women and
RA 8972]
Their Children Act of 2004)]
Availm ent
Coverage and Purpose
The parental leave is in addition to leave
VAWC leave is granted to women employees
privileges under existing laws with full pay,
who are victims of violence, as defined in RA
consisting of basic salary and mandatory
9262. The leave benefit covers the days that
allowances. It shall not be more than seven
the women employee has to attend to
(7) working days every year. [Sec. 8, RA 8972]
medical or legal concerns.
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F.6. SPECIAL LEAVE BENEFITS (SLB) FOR determine the period of recuperation of the
WOMEN woman employee. [Sec. 1, DO 112, as
amended]
[RA 9710 (The Magna Carta of Women), DOLE
DO No. 112, Series of 2011 as amended by DO
No. 112-A Series of 2012]
Conditions for Entitlement
Any female employee, regardless of age and
Special Leave Benefit for W omen civil status, shall be entitled to a special leave
benefit, provided she has complied with the
A female employee’s leave entitlement of two
following conditions:
(2) months with full pay from her employer
based on her gross monthly compensation (1) She has rendered at least 6 months
following surgery caused by gynecological continuous aggregate employment
disorders, provided that she has rendered service for the last 12 months prior to
continuous aggregate employment service of surgery;
at least six (6) months for the last 12 months.
(2) She has filed an application for special
leave
Gynecological Disorders (3) She has undergone surgery due to
gynecological disorders as certified by a
Disorders that would require surgical
competent physician. [Sec. 2, DO 112]
procedures such as, but not limited to,
dilatation and curettage and those involving
female reproductive organs such as the
Application for Special Leave
vagina, cervix, uterus, fallopian tubes, ovaries,
breast, adnexa and pelvic floor, as certified by Application before surgery
a competent physician. It shall also include
The employee shall file her application for
hysterectomy, ovariectomy, and mastectomy.
leave with her employer within a reasonable
period of time from the expected date of
surgery, or within such period as may be
Gross Monthly Compensation
provided by company rules and regulations or
The monthly basic pay plus mandatory by CBA.
allowances fixed by the regional wage boards.
[Sec. 7, Rule II, IRR, RA 9710]
Application after surgery
Prior application for leave shall not be
Basic Requirement
necessary in cases requiring emergency
The woman employee should have been with surgical procedure, provided that the
the company for 12 months prior to surgery. employer shall be notified verbally or in
An aggregate service of at least six (6) written form within a reasonable period of
months within the said 12-month period is time and provided further that after the
sufficient to entitle her to avail of the special surgery or appropriate recuperating period,
leave benefit. the female employee shall immediately file
her application using the prescribed form.
Employment service includes absences with
[Sec. 3, DO 112]
pay such as use of other mandated leaves,
company-granted leaves and maternity
leaves
Period of Entitlement
The 2 months special leave is the maximum
Competent Physician period of leave with pay that a woman
employee may avail of under RA 9710.
A medical doctor preferably specializing in
gynecological disorders or is in the position to
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Synthesis of the Rules worked for at least one (1) month during a
calendar year.
• Service charges must be pooled;
• Where a restaurant or similar
establishment does not collect service Exempted Employers:
charges but has a practice or policy of (1) Government, its political subdivisions,
monitoring and pooling tips given including GOCCs except those operating
voluntarily by its customers to its essentially as private subsidiaries of the
employees, the pooled tips should be Government;
monitored, accounted for and distributed
in the same manner as the services (2) Employers already paying their
charges. [DOLE Handbook on Workers’ employees a 13th month pay or more in a
Statutory Monetary Benefits, 2014ed.] calendar year or its equivalent at the time
of this issuance; and
• The amount collected is divided between
the company (15%) and employees (3) Employers of those who are paid on
(85%); purely commission, boundary or task
basis and those who are paid a fixed
• It shall be given twice a month with amount for performing specific work,
intervals of not more than 16 days; irrespective of the time consumed in the
performance thereof (except those
• If discontinued, removed, or stopped, the
workers who are paid on piece-rate basis,
average share of the employees of their
in which case their employer shall grant
service charge or tips shall be integrated
them 13th month pay).
with their basic wage.
Notes:
H. THIRTEENTH (13TH) MONTH PAY
AND OTHER BONUSES “Equivalent” includes:
[PD 851 (The 13th-Month Pay Law) and the (1) Christmas bonus, mid-year bonus,
Revised Guidelines on the Implementation of cash bonuses
the 13th Month Pay Law]
(2) and other payments amounting to not
less than 1/12 of the basic salary
Rationale (3) but shall NOT INCLUDE cash and
stock dividends, cost of living
• To further protect the level of real wages allowances and all other allowances
from the ravage of world-wide inflation; regularly enjoyed by the employee as
• There had been no increase in the legal well a non-monetary benefits.
minimum wage rates since 1970;
• The Christmas season is an opportune W orkers paid on a piece-rate basis -
time for society to show its concern for paid a standard amount for every piece or
the plight of the working masses so they unit of work produced that is more or less
may properly celebrate Christmas and regularly replicated, without regard to the
New Year. time spent in producing the same.
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commissions were an integral part of the imposed on the employer who is already
basic salary structure. They are not overtime paying his employees a 13th month pay or its
payments, or profit sharing payments or any equivalent. [Iran v. NLRC, G.R. No. 121927
other fringe benefit. [Phil. Duplicators vs (1998)]
NLRC (1995)]
Coverage
General Rule:
Cause for Termination Entitlement
Art. 288 Termination by Employer None
(a) Serious misconduct or willful
disobedience of lawful orders
(b) Gross and habitual neglect of duties
(c) Fraud or willful breach of trust
(d) Commission of a crime against employer
or immediate member of his family or
representative
(e) Analogous causes
Art. 289 Installation of labor saving devices or Equivalent to at least 1 month pay or 1 month pay
redundancy for every year of service, whichever is higher
Art. 289 Retrenchment to prevent losses or Equivalent to at least 1 month pay or 1/2 month
closure or cessations of operations of pay for every year of service*, whichever is higher
establishments or undertaking not due to serious
business losses or financial reverses
Art. 290 Disease when continued employment is Equivalent to at least 1 month pay or 1/2 month
prohibited by law or is prejudicial to his health or pay for every year of service*, whichever is higher
health of co-employees
Art. 291 Termination by employee whether with or None
without just cause
*A fraction of at least 6 months shall be considered 1 whole year
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mandatory retirement age is now 60. [Sec. 2, Retirement Benefits under a CBA or
RA 10757] Applicable Contract
Any EE may retire or be retired by his/her ER
J.2. AMOUNT OF RETIREMENT PAY upon reaching the age established in the CBA
or other applicable agreement/contract and
The minimum retirement pay shall be shall receive the retirement benefits granted
equivalent to one-half (1/2) month salary for therein; provided, however, that such
every year of service, a fraction of at least six retirement benefits shall not be less than the
(6) months being considered as one whole retirement pay required under RA 7641, and
year. provided further that if such retirement
For the purpose of computing retirement pay, benefits under the agreement are less, the ER
“one-half month salary” shall include all of shall pay the difference.
the following: Where both the ER and the EE contribute to a
(1) Fifteen (15) days salary based on the retirement fund pursuant to the applicable
latest salary rate; agreement, the ER’s total contributions and
the accrued interest thereof should not be
(2) Cash equivalent of five (5) days of service less than the total retirement benefits to
incentive leave; which the EE would have been entitled had
(3) One-twelfth (1/12) of the 13th month pay. there been no such retirement benefits’ fund.
(1/12 x 365/12 = .083 x 30.41 = 2.52) If such total portion from the ER is less, the
ER shall pay the deficiency.
Thus, “one-half month salary” is equivalent
to 22.5 days. [Capitol Wireless, Inc. vs Sec.
Confessor, 1996; Reyes v NLRC, 2007] J.3. RETIREMENT BENEFITS OF WORKERS
Other benefits may be included in the WHO ARE PAID BY RESULTS
computation of the retirement pay upon For covered workers who are paid by result
agreement of the ER and the EE or if provided and do not have a fixed monthly salary rate,
in the CBA. the basis for the determination of the salary
for 15 days shall be their average daily salary
(ADS). The ADS is derived by dividing the
Retirement pay under RA 7641 vis-à- total salary or earning for the last 12 months
vis retirement benefits under SSS and reckoned from the date of retirement by the
GSIS laws number of actual working days in that
RA 7641 mandates payment of retirement particular period, provided that the
benefits. All private sector employees determination of rates of payment by results
regardless of their position, designation or are in accordance with established
status and irrespective of the method by regulations.
which their wages are paid are entitled to
retirement benefits upon compulsory
retirement at the age of sixty-five (65) or J.4. RETIREMENT BENEFIT OF PART-TIME
upon optional retirement at sixty (60) or more WORKERS
but not 65. The minimum retirement pay due Part-time workers are also entitled to
covered employees shall be equivalent to retirement pay of “one-month salary” for
one-half month salary for every year of every year of service under RA 7641 after
service, a fraction of at least six (6) months satisfying the following conditions precedent
being considered as one whole year. The for optional retirement:
benefits under this law are other than those
granted by the SSS or the GSIS. (a) There’s no retirement plan between the
ER and the EE; and,
(b) The EE should have reached the age of
60 years, and should have rendered at
least 5 years of service with the ER.
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otherwise known as the Labor Code of the authorized causes provided for in this
Philippines) Code that are not connected with
pregnancy, childbirth and childcare
responsibilities.
Art. 154. RA 10151. Coverage. - This chapter
(ii) A woman worker shall not lose the
shall apply to all persons, who shall be
benefits regarding her status, seniority,
employed or permitted or suffered to work at
and access to promotion which may attach
night, except those employed in agriculture,
to her regular night work position.
stock raising, fishing, maritime transport and
inland navigation, during a period of not less Pregnant women and nursing mothers may
than seven (7) consecutive hours, including be allowed to work at night only if a
the interval from midnight to five o'clock in competent physician, other than the
the morning, to be determined by the company physician, shall certify their fitness
Secretary of Labor and Employment, after to render night work, and specify, in the case
consulting the workers' representatives/labor of pregnant employees, the period of the
organizations and employers. pregnancy that they can safely work. The
measures referred to in this article may
Night worker means any employed person
include transfer to day work where this is
whose work requires performance of a
possible, the provision of social security
substantial number of hours of night work
benefits or an extension of maternity leave.
which exceeds a specified limit. This limit
shall be fixed by the Secretary of Labor after
consulting the workers' representatives/labor
organizations and employers. The measures referred to in this article may
include transfer to day work where this is
possible, the provision of social security
benefits or an extension of maternity leave.
W omen Night W orkers. - Measures shall
be taken to ensure that an alternative to The provisions of this article shall not leave
night work is available to women workers the effect of reducing the protection and
who would otherwise be called upon to benefits connected with maternity leave
perform such work: under existing laws.[Article 158, RA 10151]
(a) Before and after childbirth, for a period of Discrimination [Art 133, RA 9710]
at least sixteen (16) weeks, which shall be
See previous section
divided between the time before and after
childbirth;
(b) For additional periods, in respect of winch Stipulation against marriage [Art 134]
a medical certificate IS produced stating
See previous section
that said additional periods are necessary
for the health of the mother or child:
(1) During pregnancy; Discharge to prevent enjoym ent of
benefits
(2) During a specified time beyond the
period, after childbirth is fixed To deny any woman employee the benefits
pursuant to subparagraph (a) provided for in this Chapter or to discharge
above, the length of which shall be any woman employed by him for the purpose
determined by the DOLE after of preventing her from enjoying any of the
consulting the labor organizations benefits provided under this Code. [Art. 135
and employers. (1)]
During the periods referred to in this article:
(i) A woman worker shall not be dismissed or Discharge on account of pregnancy
given notice of dismissal, except for just or
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To discharge such woman on account of her (b) The above acts would either:
pregnancy, while on leave or in confinement
(i) impair the employee’s rights or
due to her pregnancy. [Art. 135 (2)]
privileges under existing labor
laws; or
Discharge on account of testim ony (ii) result in an intimidating, hostile, or
offensive environment for the
To discharge or refuse the admission of such
employee.
woman upon returning to her work for fear
that she may again be pregnant. [Art. 137 (3)]
It shall be unlawful for any employer: …to (2) Education or Training environment.
discharge any woman or child or any other In an education or training environment,
employee for having filed a complaint or sexual harassment is committed:
having testified or being about to testify
(a) Against one who is under the care,
under the Code [Book III, Rule XII, Sec 13(d),
custody or supervision of the offender
IRR]
(b) Against one whose education, training,
apprenticeship or tutorship is entrusted
Expulsion of W omen faculty/ female to the offender;
student due to pregnancy outside of
(c) When the sexual favor is made a condition
marriage
to the giving of a passing grade, or the
Expulsion and non-readmission of women granting of honors and scholarships, or the
faculty due to pregnancy outside of marriage payment of a stipend, allowance or other
shall be outlawed. No school shall turn out or benefits, privileges, or considerations; or
refuse admission to a female student solely
(d) When the sexual advances result in an
on the account of her having contracted
intimidating, hostile or offensive
pregnancy outside of marriage during her
environment for the result, trainee or
term in school. [Sec. 13(c), RA 9710]
apprentice.
Role of the employer or Head of Office depending upon the needs, circumstances,
and more importantly, the emotional
Sec. 4, RA 7877. The Employer or Head of threshold of the employee.
Office shall have the duty:
Not many women are made of the stuff that
(1) to prevent the commission of such acts can endure the agony and trauma of a public,
and even corporate, scandal. If petitioner-
(2) to lay down the procedure for the corporation had not issued the third
resolution, settlement or prosecution of memorandum that terminated the services of
committed acts. private respondent, we could only speculate
how much longer she would keep her silence.
Perhaps, to private respondent's mind, for as
Sec. 5, RA 7877. He shall be solidarily liable for long as she could outwit her employer's ploys
damages: she would continue on her job and consider
them as mere occupational hazards. [Phil.
(1) if he is informed of such acts by the
Aelous Automotive United Corp. vs NLRC,
offended party and
2000]
(2) no immediate action is taken thereon.
L. MINOR WORKERS
Independent Action for Dam ages
Sec. 6, RA 7877. The victim of work, education Relevant Laws: RA 7610 (Special
or training-related sexual harassment can Protection of Children Against Abuse,
institute a separate and independent action Exploitation and Discrimination Act), RA 9231
for damages and other affirmative relief. (Special Protection of Children Against Child
Abuse, Exploitation and Discrimination Act),
Art. 137(a)
Sanctions
Criminal: imprisonment of 1 month to mos. Or Constitutional basis
fine of P10k to P20k or both
The State recognizes the vital role of the
Prescription of such action is in 3 years. youth in nation-building and shall promote
and protect their physical, moral, spiritual,
intellectual, and social well-being. It shall
Termination inculcate in the youth patriotism and
As a managerial employee, petitioner is nationalism, and encourage their
bound by more exacting work ethics. When involvement in public and civic affairs. [Art II,
such moral perversity is perpetuated against Sec. 13 of the 1987 Constitution]
his subordinate, he provides a justifiable General Rule: Children below 15 shall NOT
ground for his dismissal for lack of trust and be employed
confidence. It is the right, nay the duty of
every employer to protect its employees from Employment of Children
oversexed superiors. [Sec. 7, RA 7877] [Libres Children below fifteen (15) years of age shall
vs NLRC, 1999] not be employed except:
The gravamen of the offense in sexual (1) When a child works directly under the sole
harassment is not the violation of the responsibility of his/her parents or legal
employee's sexuality but the abuse of power guardian and where only members of
by the employer. Any employee, male or his/her family are employed: Provided,
female, may rightfully cry "foul" provided the however, That his/her employment
claim is well substantiated. Strictly speaking, neither endangers his/her life, safety,
there is no time period within which he or she health, and morals, nor impairs his/her
is expected to complain through the proper normal development: Provided, further,
channels. The time to do so may vary That the parent or legal guardian shall
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provide the said child with the prescribed him/her to any form of exploitation or is
primary and/or secondary education; or harmful to his/her health and safety or
physical, mental or psychosocial
(2) Where a child's employment or
development.
participation in public entertainment or
information through cinema, theater,
radio, television or other forms of media
Working child - refers to any child engaged
is essential: Provided, That the
as follows:
employment contract is concluded by the
child's parents or legal guardian, with the (1) when the child is below eighteen (18)
express agreement of the child concerned, years of age, in work or economic activity
if possible, and the approval of the that is not child labor as defined in the
Department of Labor and immediately preceding subparagraph;
Employment: Provided, further, That the and
following requirements in all instances
(2) when the child is below fifteen (15) years
are strictly complied with:
of age, in work where he/she is directly
(a) The employer shall ensure the under the responsibility of his/her
protection, health, safety, morals and parents or legal guardian and where only
normal development of the child; members of the child‘s family are
employed; or in public entertainment or
(b) The employer shall institute measures
information. [Sec. 3, DO 65-04]
to prevent the child's exploitation or
discrimination taking into account the Exceptions
system and level of remuneration,
(1) Child works directly under the sole
and the duration and arrangement of
responsibility of his parents or legal
working time; and
guardian and where only members of the
(c) The employer shall formulate and employer’s family are employed,
implement, subject to the approval provided:
and supervision of competent
(a) his employment does NOT endanger
authorities, a continuing program for
his life, safety, health and morals,
training and skills acquisition of the
child. (b) nor impairs his normal development,
and
In the above-exceptional cases where any
such child may be employed, the employer (c) the parent or legal guardian shall
shall first secure, before engaging such child, provide the said minor child with the
a work permit from the Department of Labor prescribed primary and/or secondary
and Employment which shall ensure education; [Sec. 12 of RA 7610 as
observance of the above requirements. amended by RA 7658]
For purposes of this Article, the term "child" (2) child’s employment or participation in
shall apply to all persons under eighteen (18) public entertainment or information
years of age.[Sec 2, RA 9231] through cinema, theater, radio or
television is essential, provided that [Sec.
12 of RA 7610 as amended by RA 7658]:
Children - refers to any person under 18
(a) employment does NOT involve ads or
years of age or those over but are unable to
commercials promoting alcohol,
fully take care of themselves or protect
tobacco and its by-products or
themselves from abuse, neglect, cruelty,
violence [Sec. 14, RA 7610]
exploitation or discrimination because of a
physical or mental disability or condition. (b) the employment contract is
[Sec. 2, RA 7610] concluded by the child’s parents or
guardian, and approved by DOLE
(c) The ER shall ensure the protection,
Child labor - refers to any work or economic
health, safety and morals of the child
activity performed by a child that subjects
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required by the school or training program pay his apprentices the minimum wage. [Art.
curriculum or as requisite for graduation or 71, LC]
board examination. [Art. 72, Labor Code]
The wages of apprentices and learners shall
Requisites of the deduction:
in no case be less than seventy-five percent
(75%) of the applicable minimum wage rates. a. Apprenticeship program must be duly
[Sec. 7, Wage Order No. NCR-19] approved by the DOLE;
b. Deduction shall NOT exceed 10% of direct
labor wage;
Enforcement
c. Employer must pay his apprentices the
Investigation of violation of apprenticeship
minimum wage.
agreement. - Upon complaint of any
interested person or upon its own initiative,
the appropriate agency of the Department of
Summary of Rules:
Labor and Employment or its authorized
representative shall investigate any violation (1) The apprentice must be paid not less
of an apprenticeship agreement pursuant to than 75% of the prescribed minimum
such rules and regulations as may be salary [Art. 61, LC];
prescribed by the Secretary of Labor and HOWEVER, the employer MAY NOT pay
Employment. [Art. 65, LC] any wage if the apprenticeship training is:
Appeal to the Secretary of Labor and a. part of the school curriculum,
Employment. - The decision of the authorized
agency of the Department of Labor and b. a requirement for graduation, or
Employment may be appealed by any c. a requirement for board examination
aggrieved person to the Secretary of Labor [Art. 72]
and Employment within five (5) days from
receipt of the decision. The decision of the (2) The apprenticeship agreement must be
Secretary of Labor and Employment shall be approved by the DOLE Secretary
final and executory. [Art.66, LC] (without such one shall be deemed a
regular employee) [Nitto Enterprises v.
Exhaustion of administrative remedies. No NLRC, Sept. 29, 1995];
person shall institute any action for the
enforcement of any apprenticeship (3) The employer is not compelled to
agreement or damages for breach of any continue one’s employment upon
such agreement, unless he has exhausted all termination of apprenticeship;
available administrative remedies. [Art. 67, (4) One-half (1/2) of the value of labor
LC] training expenses incurred for
developing the productivity and
efficiency of apprentices of the training
Incentives for em ployers cost is deducted from the employer’s
An additional deduction from taxable income income tax but it shall not exceed 10% of
of one-half (1/2) of the value of labor training direct labor wage [Art. 71]
expenses incurred for developing the
productivity and efficiency of apprentices
shall be granted to the person or enterprise W orking scholars – there is no employer-
organizing an apprenticeship program: employee relationship between students on
Provided, That such program is duly one hand, and schools, colleges or
recognized by the Department of Labor and universities on the other, where there is
Employment: Provided, further, That such written agreement between them under
deduction shall not exceed ten (10%) percent which the former agree to work for the latter
of direct labor wage: and Provided, finally, in exchange for the privilege to study free of
That the person or enterprise who wishes to charge, provided, the students are given real
avail himself or itself of this incentive should opportunities, including such facilities as may
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be reasonable and necessary to finish their (4) A commitment to employ the learners if
chosen courses under such agreement. [Sec. they so desire, as regular employees upon
14, Rule X, IRR] completion of the learnership. All
learners who have been allowed or
suffered to work during the first two (2)
O.2. LEARNERS months shall be deemed regular
employees if training is terminated by the
Learners - persons hired as trainees in semi-
employer before the end of the stipulated
skilled and other industrial occupations
period through no fault of the learners.
which are non-apprenticeable and which may
be learned through practical training on the The learnership agreement shall be subject
job in a relatively short period of time which to inspection by the Secretary of Labor and
shall not exceed three (3) months [Art 73, Employment or his duly authorized
Labor Code, Sec 4(n), RA 7796] representative. [Art. 75, LC]
Learners employed in piece or incentive-rate
jobs during the training period shall be paid
W hen may learners be hired
in full for the work done. [Art. 76, LC]
(1) No experienced workers are available;
(2) The employment of learners being
Summary of Rules
necessary to prevent the curtailment of
employment opportunities; and (1) The duration of learnership shall not
exceed 3 months [Art. 73, LC];
(3) The employment will neither create unfair
competition in terms of labor costs nor (2) If the learnership of 3 months is
impair working standards. [Art. 74, Labor completed, the employer may be
Code] compelled to continue with the services
of the learner as a regular employee;
There is a commitment from the
Terms and conditions of employment employer to employ the learners if they so
Any employer desiring to employ learners desire, as regular employees upon
shall enter into a learnership agreement with completion of the learnership;
them, which agreement shall include: (3) If the learner is dismissed from service
without just and valid cause and without
(1) The names and addresses of the learners; due process after 2 months of service, he
(2) The duration of the learnership period, will be deemed as regular employee; [Art.
which shall not exceed three (3) months; 75(d)] and
(3) The wages or salary rates of the learners (4) The wages or salary rates of the learners
which shall begin at not less than which shall begin at not less than 75% of
seventy-five percent (75%) of the the applicable minimum wage. [Art.
applicable minimum wage; and 75(c)]
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(i) have the effect of discrimination (a) all entering employees are subjected
on the basis of disability; or to such an examination regardless of
disability;
(ii) perpetuate the discrimination
of others who are the subject to (b) Information obtained during the
common administrative control. medical condition or history of the
applicant is collected and maintained
(d) Providing less compensation, such as
on separate forms and in separate
salary, wage or other forms of
medical files and is treated as a
remuneration and fringe benefits, to
confidential medical record; Provided,
qualified disabled employee, by
however, That:
reason of his disability, than the
amount to which a non-disabled (i) supervisors and managers may
person performing the same work is be informed regarding
entitled; necessary restrictions on the
work or duties of the employees
(e) Favoring a non-disabled employee
and necessary
over a qualified disabled employee
accommodations:
with respect to promotion, training
opportunities, study and scholarship (ii) first aid and safety personnel
grants, solely on account of the latter's may be informed, when
disability; appropriate, if the disability
might require emergency
(f) Re-assigning or transferring a
treatment;
disabled employee to a job or position
he cannot perform by reason of his (iii) government officials
disability; investigating compliance with
this Act shall be provided
(g) Dismissing or terminating the services
relevant information on
of a disabled employee by reason of
request; and
his disability unless the employer can
prove that he impairs the satisfactory (iv) the results of such examination
performance of the work involved to are used only in accordance
the prejudice of the business entity; with this Act. [Sec. 35, RA 7277
Provided, however, That the employer as amended by RA 9442]
first sought to provide reasonable
(3) Prohibition on Verbal, Non-Verbal
accommodations for the disabled
Ridicule and Vilification Against
persons;
Persons with Disability
(h) Failing to select or administer in the
(a) No individual, group or community
most effective manner employment
shall execute any of these acts of
tests which accurately reflect the
ridicule against persons with disability
skills, aptitude or other factor of the
in any time and place which could
disabled applicant or employee that
intimidate or result in loss of self-
such test purports to measure, rather
esteem of the latter. [Sec. 40, RA
than the impaired sensory, manual or
7277, as amended by RA 9442]
speaking skills of such applicant or
employee, if any; and (c) Any individual, group or community is
hereby prohibited from vilifying any
(i) Excluding disabled persons from
person with disability which could
membership in labor unions or similar
result into loss of self-esteem of the
organizations. [Sec. 32, RA 7277 as
latter. [Sec. 42, RA 7277, as amended
amended by RA 9442]
by RA 9442]
(2) Employment Entrance Examination
Public Ridicule - The act of making fun of
Upon an offer of employment, a disabled or contemptuous imitating or making
applicant may be subjected to medical mockery of persons with disability whether in
examinations, on the following occasions: writing, or in words, or in action due to their
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impairments. [Sec. 33, RA 7277, as amended (d) The total amount of the claimed tax
by RA 9442] deduction net of VAT if applicable,
shall be included in their gross sales
receipts for tax purposes and shall be
Vilification includes: subject to proper documentation and
to the provisions of the National
(1) The utterance of slanderous and abusive
Internal Revenue Code, as amended.
statements against a person with
[Sec. 32, RA 7277, as amended by RA
disability; and/or,
9442]
(2) An activity in public which incites hatred
towards, serious contempt for, or severe
ridicule of persons with disability. [Sec. Enforcement
41, RA 7277, as amended by RA 9442]
Enforcement by the Secretary of Justice
(a) Denial of Right
Tax Incentives for Employers/
Duty to Investigate. The Secretary of
Establishments
Justice shall investigate alleged
(1) For em ploym ent of disabled violations of this Act, and shall undertake
persons - additional deduction, from periodic reviews of compliance of covered
their gross income, equivalent to 25% of entities under this Act.
the total amount paid as salaries and
(b) Potential Violations
wages to disabled persons
The Secretary of Justice may commence a
(a) Private entities
legal action in any appropriate court if the
(b) Employ disabled persons either as Secretary has reasonable cause to believe
regular EEs, apprentice or learner that
(c) Provided such entities present proof (1) any person or group of persons is
as certified by the DOLE and the DOH engaged in a pattern of practice of
[Sec. 8[b], RA 7277] discrimination under this Act; or
(2) For construction of disabled- (2) any person or group of persons has
friendly facilities - additional been discriminated against under
deduction from their net taxable income, this Act and such discrimination
equivalent to 50% of the direct costs of raises and issue of general public
the improvements or modifications importance. [Sec 44, RA 7277]
(a) Private entities Authority of Court. The court may grant
any equitable relief that such court considers
(b) That improve or modify their physical
to be appropriate, including, to the extent
facilities in order to provide
required by this Act:
reasonable accommodation for
disabled persons (a) granting temporary, preliminary or
permanent relief;
(c) Does NOT apply to improvements or
modifications or facilities required (b) providing an auxiliary aid or service,
under BP 344. [Sec. 8 (c), RA 7277] modification of policy, practice or
procedure, or alternative method; and
(3) For establishm ents giving
discounts – may claim such discounts (c) making facilities readily accessible to
as tax deductions based on the net cost of and usable by individuals with
the goods sold or services rendered disabilities. [Sec 45, RA 7277]
(a) The cost of the discount shall be
allowed as deduction from gross
income for the same taxable year that
the discount is granted
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Penal Clause
IV. Termination of
(a) Any person who violates any provision of
this Act shall suffer the following
penalties:
Employment
(i) for the first violation, a fine of not
less than Fifty thousand pesos (P A. EMPLOYER-EMPLOYEE
50,000.00) but not exceeding One RELATIONSHIP
hundred thousand pesos
(P100,000.00) or imprisonment of
not less than six (6) months but not Art. 97, LC: As used in this Title:
more than two (2) years, or both at (a) "Person" means an individual,
the discretion of the court; and partnership, association, corporation,
(ii) for any subsequent violation, a fine business trust, legal representatives, or any
of not less than One hundred organized group of persons.
thousand pesos (P100,000.00) but (b) "Employer" includes any person acting
not exceeding Two hundred directly or indirectly in the interest of an
thousand pesos (P 200,000.00) or employer in relation to an employee and shall
imprisonment for less than two (2) include the government and all its branches,
years but not more than six (6) years, subdivisions and instrumentalities, all
or both at the discretion of the court. government-owned or controlled
(b) Any person who abuses the privileges corporations and institutions, as well as
granted herein shall be punished with nonprofit private institutions, or
imprisonment of not less than six (6) organizations.
months or a fine of not less than Five (c) "Employee" includes any individual
thousand pesos (P 5,000.00) but not employed by an employer.
more than Fifty thousand pesos (P
50,000.00), or both, at the discretion of
the court. Art. 173, LC. As used in this Title, unless the
(c) If the violator is a corporation, context indicates otherwise:
organization or any similar entity, the (f) "Employer" means any person, natural or
officials thereof directly involved shall be juridical, employing the services of the
liable therefor. (d). If the violator is an employee.
alien or a foreigner, he shall be deported
immediately after service of sentence (g) "Employee" means any person
without further deportation proceedings. compulsorily covered by the GSIS under
[Sec 46, RA 7277] Commonwealth Act Numbered One hundred
eighty-six, as amended, including the
members of the Armed Forces of the
Philippines, and any person employed as
casual, emergency, temporary, substitute or
contractual, or any person compulsorily
covered by the SSS under Republic Act
Numbered Eleven hundred sixty-one, as
amended.
(h) "Person" means any individual,
partnership, firm, association, trust,
corporation or legal representative thereof.
of this right to select his employees that the Regular status after probation
employer may set or fix a probationary period
When the bank renewed the contract after
within which the latter may test and observe
the lapse of the six-month probationary
the conduct of the former before hiring him
period, the employees thereby became
permanently. [Grand Motor Parts Corp. v.
regular employees. No employer is allowed to
MOLE, G.R. No. L-58958, (1984)]
determine indefinitely the fitness of its
employees. [Bernardo v. NLRC, G.R. No.
122917, (1999)]
Standards to qualify as a regular
employee
Requirements: Double probation
(a) The employer must communicate the There is no basis for subjecting an employee
regularization standards to the to a new probationary or temporary
probationary employee; and employment where he had already become a
regular employee when he was absorbed by a
(b) The employer must make such
sister company. [A Prime Security Services, Inc.
communication at the time of the
v. NLRC, G.R. No. 107023, (2000)]
probationary employee’s engagement.
If the employer fails to comply with either, the
employee is deemed as a regular and not a Absorbed em ployees not probationary
probationary employee.
The private respondents could not be
An employer is deemed to have made known considered probationary employees because
the standards that would qualify a they were already well-trained in their
probationary employee to be a regular respective functions. As stressed by the
employee when it has exerted reasonable Solicitor General, while private respondents
efforts to apprise the employee of what he is were still with the CCAS they were already
expected to do or accomplish during the trial clerks. Respondent Gelig had been a clerk for
period of probation. This goes without saying CCAS for more than ten (10) years, while
that the employee is sufficiently made aware respondent Quijano had slightly less than ten
of his probationary status as well as the (10) years of service. They were, therefore, not
length of time of the probation. novices in their jobs but experienced workers.
[Cebu Stevedoring Co., Inc. v. Regional Director,
The exception to the foregoing is when the
G.R. No. L-54285, (1988)]
job is self-descriptive in nature, for instance,
in the case of maids, cooks, drivers, or
messengers. [Abbott Laboratories Phil. et al. v.
Private school teachers
Alcaraz, G.R. No. 192571, (2013)]
Questions respecting a private school
In all cases of probationary employment, the
teacher’s entitlement to security of tenure are
employer shall make known to the employee
governed by the Manual of Regulations for
the standards under which he will qualify as a
Private Schools and not the Labor Code.
regular employee at the time of his
[Aklan College v. Guarino, G.R. No. 152949,
engagement. Where no standards are made
(2007)]
known to the employee at that time, he shall
be deemed a regular employee. Conversely, The legal requisites, therefore, for acquisition
an employer is deemed to substantially by a teacher of permanent employment, of
comply with the rule on notification of security of tenure are:
standards if he apprises the employee that he
(a) A full time teacher;
will be subjected to a performance evaluation
on a particular date after his hiring. [Alcira v. (b) Must have rendered three consecutive
NLRC, G.R. No. 149859, (2004)] years of service; and
(c) Service must have been satisfactory. [La
Salette of Santiago v. NLRC, G.R. No.
82918, (1991)]
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Mere completion of the three-year probation, [Robinson’s Galleria et al. v Ranchez, G.R.
even with an above-average performance, No. 177937, Jan. 19, (2011)]
does not guarantee that the employee will
The probationary employee is entitled to
automatically acquire a permanent
substantial and procedural due process
employment status. The probationer can only
before termination.
qualify upon fulfillment of the reasonable
standards set for permanent employment as
a member of the teaching personnel.
Limits to termination
[Herrera-Manaois v. St. Scholastica’s College,
G.R. No. 188914,(2013)] (1) It must be exercised in accordance with
the specific requirements of the contract
These standards should be made known to
the teachers on probationary status at the (2) If a particular time is prescribed, the
start of their probationary period, or at the termination must be within such time and
very least under the circumstances of the if formal notice is required, then that form
present case, at the start of the semester or must be used;
the trimester during which the probationary (3) The employer’s dissatisfaction must be
standards are to be applied. Of critical real and in good faith, not feigned so as
importance in invoking a failure to meet the to circumvent the contract or the law;
probationary standards, is that the school
should show – as a matter of due process – (4) There must be no unlawful discrimination
how these standards have been applied. in the dismissal. [Manila Hotel
[Colegio del Santisimo Rosario v. Rojo, G.R. No. Corporation v. NLRC, G.R. No. 53453,
170388, (2013)] (1986)]
has rendered at least one year of service, its performance as sufficient evidence of the
whether such service is continuous or broken, necessity, if not indispensability of that
shall be considered a regular employee with activity to the business of the employer.
respect to the activity in which he is employed Hence, the employment is also considered
and his employment shall continue while regular, but only with respect to such activity
such activity exists. and while such activity exists. [Forever
Richons Trading Corp. v. Molina, G.R. No.
Art. 296 [281], Last sentence, LC: An employee
206061, (2013)]
who is allowed to work after a probationary
period shall be considered a regular
employee. W hen applicable
Art. 295 is not the yardstick for determining
Regular employment is not synonymous with the existence of an employment relationship
permanent employment, because there is no because it merely distinguishes between two
such thing as a permanent employment. Any kinds of employees, i.e., regular employees
employee may be terminated for just cause. and casual employees, for purposes of
determining the right of an employee to
A regular employee is one who is engaged certain benefits, to join or form a union, or to
to perform activities which are necessary and security of tenure; it does not apply where the
desirable in the usual business or trade of the
existence of an employment relationship is in
employer as against those which are dispute. [Atok Big Wedge Co., Inc. v. Gison,
undertaken for a specific project or are
G.R. No. 169510, (2011)]
seasonal.
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project. Failure of the employer to file to the activity in which he is employed and his
termination reports after every project employment shall continue while such
completion proves that the employees are not activity exists.
project employees. [Pasos v. Philippine
Book VI, Rule 1, Sec. 5 (b), IRR: Casual
National Construction Corp., G.R. No. 192394,
employment. There is casual employment
(2013)]
where an employee is engaged to perform a
Repeated renewal of contract job, work or service which is merely incidental
to the business of the employer, and such job,
When an employer renews a contract of
work or service is for a definite period made
employment after the lapse of the six-month
probationary period, the employee thereby known to the employee at the time of
engagement: Provided, That any employee
becomes a regular employee. No employer is
who has rendered at least one year of service,
allowed to determine indefinitely the fitness
whether such service is continuous or not,
of its employees. [Malicdem v. Marulas
shall be considered a regular employee with
Industrial Corp., G.R. No. 204406, (2014)]
respect to the activity in which he is employed
and his employment shall continue while
iv. Seasonal such activity exists.
regular after service of one year, unless he employment relationship. [GMA Network, Inc.
has been contracted for a specific project. v. Pabriga, G.R. No. 176419, (2013)]
[Tabas v. California Marketing Co., Inc., G.R.
No. L-80680, (1989)].
No implied renewal of employment
contract
vi. Fixed-Term
It is a settled rule that seafarers are
Art. 295 [280] has no application to instances considered contractual employees. Their
where a fixed period of employment was employment is governed by the contracts
agreed upon knowingly and voluntarily by the they sign everytime they are rehired and their
parties, without any force, duress or improper employment is terminated when the contract
pressure being brought to bear upon the expires. Their employment is contractually
employee and absent any other fixed for a certain period of time. Thus, when
circumstances vitiating his consent, or where a contract ends, the employment is deemed
it satisfactorily appears that the employer automatically terminated, there being no
and employee dealt with each other on more mutually-agreed renewal or extension of the
or less equal terms with no moral dominance expired contract. [Unica v. Anscor Swire Ship
whatever being exercised by the former over Management Corp., G.R. No. 184318, (2014)]
the latter. [Brent School v. Zamora, G.R. No.
As long as the Brent School v. Zamora
L-48494, (1990)]
guidelines are satisfied, the court will
recognize the validity of the fixed-term
contract, especially if they were informed of
Conditions for the validity of fixed
that their engagement was for a specific
contract agreement between employer
period. The Brent doctrine is only applicable
and employee
in a few special cases wherein the employer
(1) Fixed period of employment was and employee are on more or less in equal
knowingly and voluntarily agreed upon by footing in entering into the contract [Fuji
the parties without any force, duress, or Television Network Inc v. Espiritu, G.R. No.
improper pressure or any other 204944-45, (2014)].
circumstances vitiating his consent; or
(2) The employer and the employee dealt
A.3. JOB CONTRACTING
with each other on more or less equal
terms with no moral dominance exercised I. Articles 106 – 109
by the former or the latter.
Art. 106, LC: Contractor or subcontractor.
Whenever an employer enters into a contract
with another person for the performance of
Project employment and Fixed-term
the former’s work, the employees of the
employment distinguished
contractor and of the latter’s subcontractor, if
A project employee is assigned to carry out a any, shall be paid in accordance with the
specific project or undertaking, the duration provisions of this Code.
and scope of which were specified at the time
In the event that the contractor or
the employee is engaged for the project
subcontractor fails to pay the wages of his
The duration of a fixed-term employment employees in accordance with this Code, the
agreed upon by the parties may be any day employer shall be jointly and severally liable
certain, which is understood to be "that which with his contractor or subcontractor to such
must necessarily come although it may not employees to the extent of the work
be known when." The decisive determinant in performed under the contract, in the same
fixed-term employment is not the activity that manner and extent that he is liable to
the employee is called upon to perform but employees directly employed by him.
the day certain agreed upon by the parties for
The Secretary of Labor and Employment may,
the commencement and termination of the
by appropriate regulations, restrict or prohibit
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the contracting-out of labor to protect the II. D.O. No. 18-A-11: Rules
rights of workers established under this Code. Im plem enting Articles 106 to 109 of
In so prohibiting or restricting, he may make the LC, as amended
appropriate distinctions between labor-only
contracting and job contracting as well as
differentiations within these types of Coverage
contracting and determine who among the This shall apply to:
parties involved shall be considered the
employer for purposes of this Code, to (1) all parties of contracting and
prevent any violation or circumvention of any subcontracting arrangements where ER-
provision of this Code. EE relationships exist
There is "labor-only" contracting where the (2) cooperatives engaging in contracting or
person supplying workers to an employer subcontracting arrangements
does not have substantial capital or Contractors and subcontractors referred to in
investment in the form of tools, equipment, these rules are prohibited from engaging in
machineries, work premises, among others, recruitment and placement activities as
and the workers recruited and placed by such defined in Art. 13(b) of the LC whether for
person are performing activities which are local or overseas employment.
directly related to the principal business of
such employer. In such cases, the person or
intermediary shall be considered merely as Contracting or subcontracting refers to
an agent of the employer who shall be an arrangement whereby a principal agrees
responsible to the workers in the same to put out or farm out with a contractor the
manner and extent as if the latter were performance or completion of a specific job,
directly employed by him. work or service within a definite or
predetermined period, regardless of whether
Art. 107, LC: Indirect employer. The provisions such job, work or service is to be performed or
of the immediately preceding article shall completed within or outside the premises of
likewise apply to any person, partnership, the principal.
association or corporation which, not being
an employer, contracts with an independent
contractor for the performance of any work, Service agreement refers to the contract
task, job or project. between the principal and contractor
containing the terms and conditions
governing the performance or completion of
Art. 108, LC: Posting of bond. An employer or a specific job, work or service being farmed
indirect employer may require the contractor out for a definite or predetermined period.
or subcontractor to furnish a bond equal to
the cost of labor under contract, on condition
that the bond will answer for the wages due Cabo refers to a person or group of persons
the employees should the contractor or or a labor groups which, in the guise of a
subcontractor, as the case may be, fail to pay labor organization, cooperative or any entity,
the same. supplies workers to an employer, with or
without any monetary or other consideration,
Art. 109, LC: Solidary liability. The provisions whether in the capacity of an agent of the
of existing laws to the contrary employer or as an ostensible independent
notwithstanding, every employer or indirect contractor.
employer shall be held responsible with his
contractor or subcontractor for any violation
of any provision of this Code. For purposes of
determining the extent of their civil liability
under this Chapter, they shall be considered
as direct employers.
ELEMENTS OF LABOR-ONLY
CONTRACTING:
(a)
(1) The contractor does not have substantial
capital or investments in the form of tools,
equipment, machineries, work premises,
among others, and
(2) The employees recruited and places are wages and social or welfare
performing activities which are usually benefits; or a quitclaim releasing
necessary or desirable to the operation of the principal, contractor or from
the company, or directly related to the any liability as to payment of
main business of the principal within a future claims.
definite or predetermined period,
(d) Contracting out of a job, work or
regardless of whether such job, work or
service through an in-house agency.
service is to be performed or completed
within or outside the premises of the (e) Contracting out of a job, work or
principal; or service that is necessary or desirable
or directly related to the business or
(b) The contractor does not exercise the right
operation of the principal by reason of
to control the performance of the work of the
a strike or lockout whether actual or
employee.
imminent.
Substantial capital – refers to paid-up
(f) Contracting out of a job, work or
capital stocks/shares of at least P3,000,000
service being performed by union
in the case of corporations, partnerships and
members when such will interfere
cooperatives; in case of single proprietorship,
with, restrain or coerce employees in
a net worth of at least P3,000,000.
the exercise of their rights to self-
organization as provided in Art.
248(c) of the LC, as amended.
Other prohibitions
(g) Repeated hiring of EEs under an
(1) Contracting out of jobs, works or services
employment contract of short
when not done in good faith and not
duration or under a Service
justified by the exigencies of the business
Agreement of short duration with the
such as the following:
same or different contractors, which
(a) Contracting out of jobs, works or circumvents the LC provisions on
services when the same results in the Security of Tenure.
termination or reduction of regular
(h) Requiring EEs under a subcontracting
EEs and reduction of work hours or
arrangement to sign a contract fixing
reduction or splitting of the
the period of employment to a term
bargaining unit.
shorter than the term of the Service
(b) Contracting out of work with a Cabo Agreement, unless the contract is
divisible into phases for which
(c) Taking undue advantage of the
substantially different skills are
economic situation or lack of
required and this is made known to
bargaining strength of the
the EE at the time of the
contractor’s EEs, or undermining their
engagements.
security of tenure or basic rights, or
circumventing the provisions of (i) Refusal to provide a copy of the
regular employment in any of the Service Agreement and the
following instances: employment contracts between the
contractor and the EEs deployed to
(i) Requiring them to perform
work in the bargaining unit of the
functions which are currently
principal’s certified bargaining agent
being performed by the regular
to the sole and exclusive bargaining
employees of the principal; and
agents.
(ii) requiring them to sign, as a
(j) Engaging or maintaining by the
precondition to employment or
principal of subcontracted EEs in
continued employment, an
excess of those provided in the
antedated resignation letter; a
applicable CBA or as set by the
blank payroll; a waiver of labor
Industry Tripartite Council.
standards including minimum
(2) Contracting out of jobs, works, or services DO 18-A contemplates generic or focused
analogous to the above when not done in singular activity in one contract between the
good faith and not justified by the principal and the contractor (for example,
exigencies of the business. [Sec. 7, D.O. janitorial, security, merchandising, specific
18-A-11] production work) and does not contemplate
information technology-enabled services
involving an entire process (for example, BPO,
Mandatory registration KPO, legal process outsourcing, hardware
and/or software support, medical
It shall be mandatory for all persons or
transcription, animation services, back office
entities, including cooperative, acting as
operations/support). These companies
contractors, to register with the Regional
engaged in BPOs may hire employees in
Office of the DOLE where it principally
accordance with applicable laws, and
operates.
maintain these EEs based on business
Failure to register shall give rise to the requirements, which may or may not be for
presumption that the contractor is engaged different clients of the BPOs at different
in labor-only contracting. periods of the EE’s employment.
Accordingly, the registration system
governing contracting arrangements and
Applicability of D.O. 18-A-11 to the
implemented by the Regional Offices of the
Construction Industry
DOLE is hereby established, with the Bureau
of Working Conditions (BWC) as the central Licensing and the exercise of regulatory
registry. [Sec. 14, D.O. 18-A-11] powers over the construction industry is
lodged with PCAB which is under the
Construction Industry Authority of the
Solidary Liability of Indirect/Direct Philippines and not with the DOLE or any of
Employer its regional offices.
There exists a solidary liability on the part of Thus, the DOLE, through its regional offices
the principal and the contractor for purposes shall not require contractors licensed by
of enforcing the provisions of the LC and PCAB in the Construction Industry to register
other social legislation to the extent of the under DO 18-A. Moreover, findings of
work performed under employment contract. violation/s on labor standards and
The principal shall be deemed a direct occupational health and safety standards
employer of the contractor’s employee in shall be coordinated with PCAB for its
cases where there is a finding by a competent appropriate action, including the possible
authority of labor-only contracting, or cancellation/suspension of the contractor’s
commission of prohibited activities provided license.
in Section 7 or a violation of either Sections 8
or 9.
iv. Effects of labor-only contracting
Employees become regular employees
iii. Department Circular No. 01-12
Where an entity is declared to be a labor-only
Applicability of D.O. 18-A-11 to BPO contractor, the employees supplied by said
DO 18-A speaks of a trilateral relationship contractor to the principal employer become
that characterizes the covered regular employees of the latter. Having
contracting/sub-contracting arrangement. gained regular status, the employees are
Thus, vendor-vendee relationship for entire entitled to security of tenure and can only be
business processes covered by the applicable dismissed for just or authorized causes and
provisions of the Civil Code on Contracts is after they had been afforded due process.
excluded. [Norkis Trading v. Buenavista, G.R. No. 182018.
(2012)]
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his other benefits or their monetary under valid agreements. [San Miguel
equivalent computed from the time his Brewery Sales Force Union v. Ople, G.R.
compensation was withheld from him up to No. 53515 (1989)]
the time of his actual reinstatement.
Guide in disposition of labor disputes
Bare and vague allegations as to the manner
Nature of Right/Rationale of service and the circumstances surrounding
the same would not suffice. A mere copy of
It is a constitutionally protected right (Art. XIII the notice of termination allegedly sent by
Sec. 3, 1987 Constitution); it cannot be respondent to petitioner, without proof of
blotted out by an employment contract. receipt, or in the very least, actual service
Termination of employment is not anymore a thereof upon petitioner, does not constitute
mere cessation or severance of contractual substantial evidence.
relationship but an economic phenomenon There may be cases where the circumstances
affecting members of the family. This is the
warrant favoring labor over the interests of
reason why under the broad principles of management but never should the scale be
social justice the dismissal of employees is
so tilted if the result is an injustice to the
adequately protected by the laws of the state. employer. Justitia nemini neganda est
[Alhambra Industries, Inc. v. NLRC, G.R. No. (Justice is to be denied to none). [Mansion
106771 (1994)]
Printing Center v. Bitara, Jr., GR 168120.
(2012)]
Managem ent Prerogatives and
Security of Tenure Procedural vis-à-vis substantive
An employer may not be compelled to issues
continue in its employ a person whose In labor cases, substantive issues must be
continuance in the service would patently be addressed more than anything else, and so,
inimical to its interests. [Baguio Central the Court may forego the matter of
University v. Gallente, G.R. No. 188267 (2013)] procedural infirmities. [Ang v. San Joaquin, Jr.,
In dismissal cases, the Court must consider a G.R. No. 185549 (2013)]
balancing between the employees’ tenurial
rights and the employer’s management
prerogative. [Imasen Phil. Manufacturing Corp. Employer’s Burden of Proof
v. Alcon & Papa, GR 194884 (2014)]
Art. 292 (b), 3rd sentence: The burden of
Management prerogative must be exercised proving the termination was for a valid or
in good faith and with due regard to the authorized cause shall rest on the employer.
rights of the workers in the spirit of fairness
and with justice in mind. [Philbag Industrial
Manufacturing Corp. v. Philbag Workers It is the employer’s burden to prove that the
Union-Lakas at Gabay ng Manggagawang dismissal was for a just or authorized cause.
Nagkakaisa, G.R. No. 182486 (2012)] [Temic Automotive (Phils.), Inc. v. Cantos, G.R.
No. 200729 (2014)]
Unsubstantiated accusations or baseless
Requisites for the validity of
conclusions of the employer are insufficient
management prerogative affecting
legal justifications to dismiss an employee.
security of tenure
The unflinching rule in illegal dismissal cases
(a) Exercised in good faith for the is that the employer bears the burden of
advancement of the Employer's proof. [Garza v. Coca-Cola Bottlers Philippines,
interest, and Inc., G.R. No. 180972 (2014)]
(b) Not for the purpose of defeating or
circumventing the rights of the
Employees under special laws or
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For willful disobedience to be a valid cause Gross Negligence includes gross inefficiency
for dismissal, these two elements must
Article 290 of the Labor Code provides that
concur: (1) the employee’s assailed conduct
one of the just causes for terminating an
must have been willful, that is, characterized
employment is the employee's gross and
by a wrongful and perverse attitude; and (2)
habitual neglect of his duties. This cause
the order violated must have been
includes gross inefficiency, negligence and
reasonable, lawful, made known to the
carelessness [Century Iron Works, Inc. v.
employee, and must pertain to the duties
Bañas, G.R. No. 184116 (2013)]
which he had been engaged to discharge.
[The Coffee Bean and Tea Leaf Philippines, Inc.
and Chu v Arenas, G.R. No. 208908 (2015)]
Loss of Trust and Confidence
The loss of trust and confidence must be
Gross and Habitual Neglect of Duties based on willful breach of the trust reposed in
the employee by his employer. Such breach is
Elements:
willful if it is done intentionally, knowingly,
(a) There must be neglect of duty; and and purposely, without justifiable excuse, as
distinguished from an act done carelessly,
(b) The negligence must be both gross and thoughtlessly, heedlessly or inadvertently.
habitual in character. [Sec. 5.2. (c), DO
And, in order to constitute a just cause for
147-15]
dismissal, the act complained of must be
Gross negligence has been defined as the work-related and shows that the employee
want or absence of or failure to exercise slight concerned is unfit to continue working for the
care or diligence, or the entire absence of employer. In addition, loss of confidence as a
care. It evinces a thoughtless disregard of just cause for termination of employment is
consequences without exerting any effort to premised on the fact that the employee
avoid them. In order to constitute just cause concerned holds a position of responsibility,
for an EE’s dismissal due to negligence, it trust and confidence or that the employee
must not only be gross, but also habitual. A concerned is entrusted with confidence with
single or an isolated act that cannot be respect to delicate matters, such as handling
categorized as habitual, hence, not a just or case and protection of the property and
cause for their dismissal. [National Bookstore assets of the employer. The betrayal of this
v. CA, G.R. No. 146741 (2002)] trust is the essence of the offense for which
an employee is penalized. [Villanueva, Jr. v.
Gross negligence connotes want of care in
NLRC, G.R. No. 176893 (2012)]
the performance of one’s duties, while
habitual neglect implies repeated failure to The loss of trust and confidence must be
perform one’s duties for a period of time, based not on ordinary breach by the
depending on the circumstances. employee of the trust reposed in him by the
employer, but, in the language of Article 282
Estoppel by toleration of management:
(c) of the Labor Code, on willful breach. A
breach of rules and regulations which are
breach is willful if it is done intentionally,
tolerated by management cannot serve basis
knowingly and purposely, without justifiable
as termination. The rule only applies when
excuse, as distinguished from an act done
the violation is not tantamount to fraud or
carelessly, thoughtlessly, heedlessly or
commission of illegal activities. One cannot
inadvertently. It must rest on substantial
evade liability based on obedience to the
grounds and not on the employer's
corporate chain of command. [PNB v. Padao,
arbitrariness, whims, caprices or suspicion;
G.R. No. 180849, 187143 (2011)]
otherwise, the employee would eternally
On the principle of respondeat superior or remain at the mercy of the employer.
command responsibility alone, a managerial [Johansen World Group Corp. v. Gonzales III,
employee may be held liable for negligence in G.R. No. 198733 (2012)]
the performance of her managerial duties.
[Jumuad v. Hi-Flyer Food, Inc., G.R. No. 187887
(2011)]
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No act or omission shall be considered as has the burden of proof to show a deliberate
analogous cause unless expressly and unjustified refusal of the employee to
specified in the company rules and resume his employment without any
regulations or policies. [Sec. 5.2. (g), DO intention of returning. [Tan Brothers Corp. of
147-15] Basilan City v. Escudero, G.R. No. 188711
(2013)]
One is analogous to another if it is
susceptible of comparison with the latter
either in general or in some specific detail; or
Courtesy Resignation
has a close relationship with the latter.
Resignation per se means voluntary
relinquishment of a position or office. Adding
Other Causes the word "courtesy" did not change the
essence of resignation. [Batongbacal v.
(1) Abandonment
Associated Bank, G.R. No. 72977 (1988)]
(2) Courtesy Resignation
(3) Change of Ownership
Change of Ownership
(4) Habitual Absenteeism/Tardiness
A mere change in the equity composition of a
(5) Past Offenses corporation is neither a just nor an authorized
cause that would legally permit the dismissal
(6) Habitual Infractions
of the corporation's employees en masse.
(7) Immorality [SME Bank, Inc. v. De Guzman, G.R. No.
(8) Conviction/Commission of a Crime 184517, 186641 (2013)]
six-day suspension for her third absence on grounds for termination of employment and
April 27, 2000.” said act raised concerns to the cooperative as
the Board received numerous complaints and
petitions from the cooperative members
Past Offenses themselves asking for the removal of
Bandiola because of his immoral conduct,
Previous offense may be used as valid
hence, immorality (extramarital affair)
justification for dismissal from work only if
justified terminating the employment by the
the infractions are related to the subsequent
employer [Alilem Credit Cooperative vs.
offense upon which the basis of termination is
Bandiola, Jr., G.R. No. 173489 (2013)]
decreed. [Century Canning Corporation v.
Ramil, G.R. No. 171630 (2010)]
Pregnancy Out of Wedlock
Habitual Infractions Accordingly, when the law speaks of immoral
or, necessarily, disgraceful conduct, it
A series of irregularities when put together
pertains to public and secular morality; it
may constitute serious misconduct, which
refers to those conducts which are proscribed
under Article 297 of the Labor Code, as
because they are detrimental to conditions
amended, is a just cause for dismissal [Gustilo
upon which depend the existence and
v. Wyeth Phil. Inc., G.R. No. 149629 (2004)]
progress of human society. To stress, pre-
marital sexual relations between two
Totality of infractions doctrine consenting adults who have no impediment
to marry each other, and, consequently,
The totality of infractions or the number of conceiving a child out of wedlock, gauged
violations committed during the period of from a purely public and secular view of
employment shall be considered in morality, does not amount to a disgraceful or
determining the penalty to be imposed upon immoral conduct under Section 94(e) of the
an erring employee. Fitness for continued 1992 MRPS. [Cheryl Leus v. St. Scholastica
employment cannot be compartmentalized College Westgrove, G.R. No. 187226 (2015)]
into tight little cubicles of aspects of
character, conduct and ability separate and
independent of each other. While it may be Conviction/Commission of a Crime
true that petitioner was penalized for his
The charge of drug abuse within the
previous infractions, this does not and should
company’s premises and during work hours
not mean that his employment record would
constitutes serious misconduct which is one
be wiped clean of his infractions. After all, the
of the just causes for termination. [Bughaw,
record of an employee is a relevant
Jr. v. Treasure Island Industrial, G.R. No. 173151
consideration in determining the penalty that
(2008)]
should be meted out since an employee's
past misconduct and present behavior must
be taken together in determining the proper
B.2. AUTHORIZED CAUSES
imposable penalty. [Merin v. NLRC, G.R. No.
171790 (2008)] [Art. 298, LC] (previously Art. 283),
(1) Installation of labor saving device
Immorality (2) Retrenchment to prevent losses
DECS Order No. 92 provides that disgraceful (3) Redundancy
or immoral conduct can be used as a basis for
(4) Closure of Business
termination of employment [Santos, Jr. v.
NLRC, G.R. No. 115795 (1998)]
The act of engaging in extramarital affairs
was specifically provided for by the
cooperative’s Personnel Policy as one of the
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Due to labor-saving Due to retrenchment, (d) There is no other option available to the
devices or redundancy closure, or suspension employer than the introduction of
of operations machinery, equipment or device and the
consequent termination of employment
of those affected thereby; and
1-month pay, or at 1 month pay, or at
least 1 month pay for least ½ month pay for (e) There must be fair and reasonable criteria
every year of service, every year of service, in selecting employees to be terminated.
whichever is higher. whichever is higher. [Sec. 5.4. (a), DO 147-15]
Requirements for termination due to
A fraction of at least six months shall be installation of labor-saving device
considered as one year. (1) The employer exercises its prerogative to
install the labor-saving device in good
faith for the advancement of its interest
Basis and not to defeat or circumvent the
employee’s right to security of tenure;
Employment is the lifeblood upon which the
worker and his family owe their (2) The employer served a written notice
survival. [Flight Attendants and Stewards both to the employees and to the DOLE
Ass'n of the Philippines v. PAL, Inc., G.R. No. at least 30 days prior to the intended
178083 (2009)] date of termination; and
(3) The employer pays the employees
separation pay equivalent to one-month
There are five business-related causes for
pay or at least one-half (1/2) month pay
termination:
for every year of service, whichever is
1. Installation of labor-saving devices higher, a fraction of at least six months
being considered as one whole year
2. Retrenchment
(Samson, 2004)
3. Redundancy
4.Closure of business
Retrenchment
5.Temporary/bona fide suspension of
Elements of a valid retrenchment:
operations
(1) The retrenchment is reasonably
necessary and likely to prevent
Installation of Labor-Saving Device business
This refers to the installation of machinery to (2) The losses, if already incurred, are not
effect economy and efficiency in the merely de minimis, but substantial,
employer’s method of production [Edge serious, actual and real, or if only
Apparel, Inc. v. NLRC, G.R. No. 121314 (1998)] expected, are reasonably imminent as
Elements of a valid termination based on perceived objectively and in good
installation of labor-saving devices faith by the employer;
(a) There must be introduction of machinery, (3) The expected or actual losses must
equipment or other devices; be proved by sufficient and
convincing evidence;
(b) The introduction must be done in good
faith; (4) The retrenchment must be in good
faith for the advancement of its
(c) The purpose for such introduction must interest and not to defeat or
be valid such as to save on cost, enhance circumvent the employees’ right to
efficiency and other justifiable economic security of tenure; and
reasons;
(5) There must be fair and reasonable
criteria in ascertaining who would be
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Corporate acquisitions
Guidelines in Closure
Asset Sales Stock Sales
(1) Closure or cessation of operations of
establishment or undertaking may either Sale
be partial or total
Corporate entity sells all In stock sales, the
(2) Closure or cessation of operations of or substantially all of its individual or corporate
establishment or undertaking may or may assets to another entity. shareholders sell a
not be due to serious business losses or controlling block of
financial service reverses. However, in stock to new or existing
both instances, proof must be shown shareholders.
that:
Obligation of Seller
(a) it was done in good faith to
advance the employer's interest Seller in good faith is A shift in the
and not for the purpose of authorized to dismiss composition of its
the affected employees, shareholders will not
defeating or circumventing the
but is liable for the affect its existence and
rights of employees under the law payment of separation continuity.
or a valid agreement; and pay under the law. Notwithstanding the
(b) Written notice on the affected stock sale, the
corporation continues to
employees and the DOLE is
be the employer of its
served at least one month before people and continues to
the intended date of termination be liable for the
of employment. payment of their just
(3) The employer can lawfully close shop claims.
even if not due to serious business losses Obligation of Buyer
or financial reverses but separation pay,
which is equivalent to at least one month The buyer in good faith, The corporation or its
pay as provided for by Article 289 of the on the other hand, is not new majority
Labor Code, as amended, must be given obliged to absorb the shareholders are not
to all the affected employees. employees affected by entitled to lawfully
the sale, nor is it liable dismiss corporate
(4) If the closure or cessation of operations of for the payment of their employees absent a
establishment or undertaking is due to claims. The most that it just or authorized
serious business losses or financial may do, for reasons of cause.
reverses, the employer must prove such public policy and social [SME Bank, Inc. v. De
allegation in order to avoid the payment justice, is to give Guzman, G.R. No.
preference to the 184517, 186641, (2013)]
of separation pay. Otherwise, the affected
qualified separated
employees are entitled to separation pay. personnel of the selling
(5) The burden of proving compliance with firm.
all the above-stated falls upon the
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ii. Enforcement of Union Security Clause in to be heard, and not necessarily that an
CBA actual hearing was conducted.
Union security is a generic term, which is (c) After determining that termination of
applied to and comprehends: employment is justified, the employers
shall serve the employees a written notice
Closed shop – an enterprise in which, by
of termination indicating that: (1) all
agreement between the employer and his
circumstances involving the charge
employees or their representatives, no person
against the employees have been
may be employed in any or certain agreed
considered; and (2) grounds have been
departments of the enterprise unless he or
established to justify the severance of
she is, becomes, and, for the duration of the
their employment. [Inguillo v. First Phil
agreement, remains a member in good
Scales, G.R. No. 165407 (2009)]
standing of a union entirely comprised of or
of which the employees in interest are a part.
Union shop – when all new regular iii. Dismissal of union officers for the
employees are required to join the union conduct of an illegal strike / dismissal of
within a certain period as a condition for their union members for participating in the
continued employment. commission of illegal acts
Law authorizes the enforcement of union Art. 279, a, 3rd par., 2nd sen., LC: Any union
security clauses, provided such enforcement officer who knowingly participates in an illegal
is not characterized by arbitrariness, and strike and any worker or union officer who
always with due process. knowingly participates in the commission of
illegal acts during a strike may be declared to
have lost his employment status.
(1) Substantive – whether the termination of
employment was based on the provisions of
the Labor Code or in accordance with the
prevailing jurisprudence; iv. Termination in conformity with existing
statute / Qualification requirements
In terminating the employment of an
employee by enforcing the Union Security While the right of workers to security of
Clause, the employer needs only to determine tenure is guaranteed by the Constitution, its
and prove that: exercise may be reasonably regulated
pursuant to the police power of the State to
(a) The union security clause is applicable; safeguard health, morals, peace, education,
(b) The union is requesting for the order, safety, and the general welfare of the
enforcement of the union security people. Consequently, persons who desire to
provision in the CBA; and engage in the learned professions requiring
scientific or technical knowledge may be
(c) There is sufficient evidence to support the required to take an examination as a
union's decision to expel the employee prerequisite to engaging in their chosen
from the union or company. careers. [St. Lukes’s Medical Center Employees
(2) Procedural – the manner in which the Ass'n-AFW v. NLRC, G.R. No. 162053 (2007)]
dismissal was effected.
(a) The first written notice to be served on
the employees should contain the specific
causes or grounds for termination against
them, and a directive that the employees
are given the opportunity to submit their
written explanation within a reasonable
period.
(b) The requirement of a hearing is complied
with as long as there was an opportunity
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Employer may not substitute the required (1) First written notice: served on the
prior notice & opportunity to be heard with employee specifying the ground or
the mere payment of 30 days' salary. [PNB v. grounds for termination, and giving said
Cabansag, G.R. No. 157010 (2005)] employee reasonable opportunity within
which to explain his side.
(2) Second written notice: served upon the
Right to Counsel employee, indicating that upon due
The right to counsel, a very basic requirement consideration of all the circumstances,
of substantive due process, has to be grounds have been established to justify
observed. Indeed, the rights to counsel and to his termination.
Validity of
Situation Liability of ER
Dismissal
Just or Authorized Cause Valid No liability.
+ Due Process Separation pay only in authorized cause
Just or Authorized Cause Valid Liable for damages due to procedural infirmity.
+ No Due Process Separation pay if for authorized cause
C. RELIEFS FOR ILLEGAL DISMISSAL Systems, Inc. v. Dailig, G.R. No. 204761
(2014)]
Art. 294, LC: Security of Tenure. In case of
regular employment, the employer shall not
terminate the services of an employee except Prescription Period
for a just cause or when authorized by this
Title. An employee who is unjustly dismissed An action for reinstatement by reason of
from work shall be entitled to reinstatement illegal dismissal is one based on an injury,
without loss of seniority rights and other which may be brought within 4 years from the
privileges and to his full backwages, inclusive time of dismissal. [Art. 1146, CC]
of allowances, and to his other benefits or their
monetary equivalent computed from the time
his compensation was withheld from him up to i. Reinstatement pending appeal
the time of his actual reinstatement.
Art. 229, par. 3 LC: In any event, the decision of
the Labor Arbiter reinstating a dismissed or
separated employee, insofar as the
C.1. REINSTATEMENT reinstatement aspect is concerned, shall
Reinstatement means restoration to a state immediately be executory, pending appeal.
or condition from which one had been The employee shall either be admitted back to
removed or separated. The person reinstated work under the same terms and conditions
assumes the position he had occupied prior prevailing prior to his dismissal or separation
to his dismissal. [Asian Terminals, Inc. v. or, at the option of the employer, merely
Villanueva, G.R. No. 143219 (2006)] reinstated in the payroll. The posting of a bond
by the employer shall not stay the execution for
reinstatement provided herein.
General Rule: Reinstatement and backwages
Two options given to employers:
Exceptions:
1) Actually reinstate the dismissed
(1) Separation pay employees or,
(2) Closure of business [Retuya v. Hon. 2) Constructively reinstate them in the
Dumarpa, G.R. No. 148848 (2003)] payroll.
(3) Economic business conditions [Union of Either way, this must be done immediately
Supervisors v. Secretary of Labor, G.R. No. upon the filing of their appeal, without need
L-39889 (1981)] of any executory writ.
(4) Employee’s unsuitability [Divine Word If the order of reinstatement of the Labor
High School v. NLRC, G.R. No. 72207 Arbiter is reversed on appeal, it is obligatory
(1986)] on the part of the employer to reinstate and
(5) Employee’s retirement/ overage [New pay the wages of the dismissed employee
Philippine Skylanders, Inc. v. Dakila, G.R. during the period of appeal until reversal by
No. 199547 (2012)] the higher court. The Labor Arbiter's order of
reinstatement is immediately executory and
(6) Antipathy and antagonism [Wensha Spa the employer has to either re-admit them to
Center v. Yung, G.R. No. 185122 (2010)] work under the same terms and conditions
(7) Job with a totally different nature [DUP prevailing prior to their dismissal, or to
Sound Phils. v. CA, G.R. No. 168317 (2011)] reinstate them in the payroll, and that failing
to exercise the options in the alternative,
(8) Long passage of time employer must pay the employee's salaries
(9) Inimical to the employer's interest [Magana v. Medicard Philippines, Inc., G.R.
No. 174833 (2010)]
(10) When supervening facts have transpired
which make execution on that score
unjust or inequitable or, to an increasing
extent [Emeritus Security & Maintenance
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(1) When reinstatement is no longer Inasmuch as the words "wages", "pay" and
possible, in cases where the dismissed "salary" have the same meaning, and
employee's position is no longer commission is included in the definition of
available; "wage", the logical conclusion, therefore, is,
in the computation of the separation pay of
(2) The continued relationship between the petitioners, their salary base should include
employer and the employee is no longer also their earned sales commissions. [Songco
viable due to the strained relations v. NLRC, G.R. Nos. 50999-51000 (1990)]
between them; and
A dismissed employee who has accepted The period of delay in instituting this ULP
separation pay is not necessarily estopped charge with claim for reinstatement and
from challenging the validity of his or her
backwages, although within the prescriptive
dismissal. Neither does it relieve the
period, should be deducted from the liability
employer of legal obligations. [Anino v. NLRC,
of the employer to him for back wages.
G.R. No. 123226 (1998)]
[Mercury Drug Co. Inc. v. CIR, G.R. No. L-23357
(1974)]
C.2. BACKWAGES The salary base properly used should be the
basic salary rate at the time of dismissal plus
Backwages are earnings lost by a worker due
the regular allowances; allowances include:
to his illegal dismissal; a form of relief that
restores the income lost by reason of such Emergency cost of living allowances (ECOLA),
unlawful dismissal; it is not private transportation allowances, 13th month pay.
compensation or damages; nor is it a redress [Paramount Vinyl Product Corp. v. NLRC
of a private right but, rather, in the nature of (1990)]
a command to the employer to make a public
Also included are vacation leaves, service
reparation for illegally dismissing an
incentive leaves, and sick leaves
employee. [St. Theresa's School of Novaliches
Foundation v. NLRC, G.R. No. 122955 (1998)] The effects of extraordinary inflation are not
to be applied without an official declaration
Backwages and reinstatement are two reliefs
thereof by competent authorities. [Lantion v.
that should be given to an illegally dismissed
NLRC, G.R. No. 82028 (1990)]
employee. They are separate and distinct
from each other. An illegally dismissed
employee is entitled to (1) either
ii. Limited backwages
reinstatement, if viable, or separation pay if
reinstatement is no longer viable, and (2) General rule: An illegally dismissed
backwages. Payment of backwages is employee is entitled to full backwages.
specifically designed to restore an employee's Exceptions
income that was lost because of his unjust
dismissal. [Aurora Land Projects Corp. v. (1) The Court awarded limited backwages
NLRC, G.R. No. 114733 (1997)] where the employee was illegally
dismissed but the employer was found to
be in good faith. [San Miguel Corporation
Effect of failure to order backwages v. Javate, Jr., G.R. No. L-54244 (1992)]
A “plain error” which may be rectified, even if (2) Delay of the EE in filing the case for
employee did not bring an appeal regarding illegal dismissal [Mercury Drug Co., Inc. v.
the matter [Aurora Land Projects Corp. v. CIR, supra]
NLRC, supra]
Rationale
i. Computation of backwages Feati University Club vs. Feati University (1974)
Full backwages means exactly adopted a consensus policy of pegging the
that, i.e., without deducting from backwages amount of backwages to their total
the earnings derived elsewhere by the equivalent for three years (depending on the
concerned employee during the period of his circumstances) without deduction or
illegal dismissal. [Bustamante v. NLRC, G.R. qualification. The rationale for the policy was
No. 111651 (1996)] stated in the following words:
Awards including salary differentials are not As has been noted, this formula of awarding
allowed [Insular Life Assurance Co. v. NLRC, reasonable net backwages without deduction
1987] or qualification relieves the employees from
proving or disproving their earnings during
their lay-off and the employers from
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Indemnity of Employer
Doctrine in Validity of
Period Liability of ER
effect Dismissal
the degree of the infraction. [Consolidated [William Barroga vs. Data Center College of the
Food Corporation vs. NRLC, G.R. No. 118647 Philippines, G.R. No. 174158 (2011)]
(1999)] [St. Michael’s Institute vs. Santos, G.R.
Re-assignments made by management
No. 145280 (2001)]
pending investigation of irregularities
Right to dismiss or otherwise impose allegedly committed by an employee fall
disciplinary sanctions upon an employee for within the ambit of management prerogative.
just and valid cause, pertains in the first place The purpose of reassignments is no different
to the employer, as well as the authority to from that of preventive suspension which
determine the existence of said cause in management could validly impose as a
accordance with the norms of due process. disciplinary measure for the protection of the
[Makati Haberdashery, Inc. vs. NLRC, G.R. company's property pending investigation of
Nos. 83380-81 (1989)] any alleged malfeasance or misfeasance
committed by the employee. [Ruiz s.v Wendel
Although the right of employers to shape
Osaka Realty Corp., G.R. No. 189082 (2012)]
their own work force,is recognized, this
management prerogative must not curtail the In cases of a transfer of an employee, the rule
basic right of employees to security of tenure. is settled that the employer is charged with
[Alert Security & Investigation Agency, Inc. vs. the burden of proving that its conduct and
Saidali Pasawilan, et. al., G.R. No. 182397 action are for valid and legitimate grounds
(2011)] such as genuine business necessity and that
the transfer is not unreasonable,
inconvenient or prejudicial to the employee. If
B. TRANSFER OF EMPLOYEES the employer cannot overcome this burden of
proof, the employee’s transfer shall be
tantamount to unlawful constructive
An employee’s right to security of tenure does dismissal. [Jonathan Morales v. Harbor Centre
not give him such a vested right in his Port Terminal Inc., G.R. No. 174208 (2012)]
position as would deprive the company of its
prerogative to change his assignment or
transfer him where he will be most useful.
C. PRODUCTIVITY STANDARD
The Employer has the right to transfer or
assign Employees from one area of operation
to another, or one office to another or in The employer has the right to demote and
pursuit of its legitimate business interest, transfer an employee who has failed to
Provided there is no demotion in rank or observe proper diligence in his work and
diminution of salary, benefits and other incurred habitual tardiness and absences and
privileges and not motivated by indolence in his assigned work. [Petrophil
discrimination or made in bad faith, or Corporation vs. NLRC, G.R. No. L-64048
effected as a form of punishment or demotion (1986)]
without sufficient cause. [Westin Phil. Plaza In the consolidated cases of Leonardo vs.
Hotel vs. NLRC, G.R. No. 121621 (1999)] NLRC [G. R. No. 125303 (2000)] and Fuerte
When the transfer is not unreasonable, or vs. Aquino [G. R. No. 126937 (2000)], the
inconvenient, or prejudicial to the employee, employer claimed that the employee was
and it does not involve a demotion in rank or demoted pursuant to a company policy
diminution of salaries, benefits, and other intended to foster competition among its
privileges, the employee may not complain employees. Under this scheme, its employees
that it amounts to a constructive dismissal. are required to comply with a monthly sales
[Bisig ng Manggagawa sa TRYCO v. NLRC, quota. Should a supervisor such as the
G.R. No. 151309 (2008)] employee fail to meet his quota for several
consecutive months, he will be demoted,
whereupon his supervisor’s allowance will be
It is management prerogative for employers withdrawn and be given to the individual who
to transfer employees on just and valid takes his place. When the employee
grounds such as genuine business necessity. concerned succeeds in meeting the quota
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iii. Retirement benefits [Sec. 12-B] iv. Permanent disability benefits [Sec. 13-A]
II. a member who has reached 60 (2) In case the permanently disabled
years may also avail if he is member dies, it would be given the same
already separated from treatment as a retiree dying.
employment or has ceased to be (3) For permanent partial disability, the
self-employed. pension is not lifetime. [e.g. loss of thumb
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(2) If he has no primary beneficiaries and he (2) Confined for at least 4 days either in a
dies within sixty [60] months from the hospital or elsewhere with SSS approval;
start of his monthly pension, his (3) At least 3 months of contributions in the
secondary beneficiaries shall be entitled 12 month period immediately before the
to a lump sum benefit equivalent to the semester of sickness or injury has been
total monthly pensions corresponding to paid;
the balance of the five-year guaranteed
period excluding the dependents’ (4) All company sick leaves with pay for the
pension. current year have been used up;
(5) Maximum of 120 days per 1 calendar year
[i.e maximum permissible for the same
sickness and confinement is 240 days for ix. Maternity leave benefits [Sec. 14-A]
2 consecutive years];
Eligibility Requirements [2000, 2005,
(6) The employer has been notified, or, if a 2007, 2010 Bar Question]
separated, voluntary or self-employed
(1) A female member
member, the SSS directly notified within
5 days of confinement; (2) Paid at least three [3] monthly
contributions in the twelve-month period
(7) Notice to employer or SSS not needed
immediately preceding the semester of
when confinement is in a hospital; notice
her childbirth or miscarriage
to employer not required as well when
Employee became sick or injured while (3) She shall have notified her employer of
working or within premises of the her pregnancy and the probable date of
employer. her childbirth, which notice shall be
transmitted to the SSS in accordance
Benefit: daily cash allowance paid for the
with the rules and regulations it may
number of days a member is unable to work
provide;
due to sickness or injury equivalent to 90% x
[average daily salary credit] Process
Note: One hundred percent [100%] of the The full payment shall be advanced by the
daily benefits provided in the preceding employer within thirty [30] days from the
paragraph shall be reimbursed by the SSS to filing of the maternity leave application;
said employer upon receipt of satisfactory
Coverage
proof of such payment and legality thereof if
the following conditions are met: The maternity benefits provided under this
section shall be paid only for the first four [4]
(1) The employer notified the SSS of the
deliveries or miscarriages;
confinement within five calendar days
after receipt of the notification from the Employer’s Reimbursement
employee member That the SSS shall immediately reimburse
(2) If the notification to the SSS is made by the employer of one hundred percent [100%]
the employer beyond five calendar days of the amount of maternity benefits advanced
after receipt of the notification from the to the employee by the employer upon receipt
employee member, he shall be of satisfactory proof of such payment and
reimbursed only for each day of legality thereof.
confinement starting from the tenth Note: All of these benefits are tax-exempt.
calendar day immediately preceding the
date of notification to the SSS.
(3) SSS shall reimburse the employer or pay A.4. BENEFICIARIES
the unemployed member only for
1. PRIMARY
confinement within the one-year period
immediately preceding the date the claim (1) Dependent spouse – until remarriage
for benefit or reimbursement is received [see above];
by the SSS, except confinement in a
(2) Dependent children [legitimate,
hospital in which case the claim for
legitimated, legally adopted, and
benefit or reimbursement must be filed
illegitimate] [see above]; illegitimate
within one [1] year from the last day of
children are entitled only to 50% of the
confinement.
share of legitimate children unless there
are no legitimate children, in which case,
they get 100%.
Note: Subject to periodic adjustment [Sec. 14] disability or has paid a total of at
least 180 monthly contributions prior
to disability; and
B.3.3. PERMANENT DISABILITY BENEFITS
(c) Member is not enjoying old-age
Disabilities Deemed Total and Permanent retirement benefit. [Sec. 16]
[Sec. 16]
(a) Complete loss of sight of both eyes;
Benefit for Permanent Total Disability
(b) Loss of 2 limbs at or above the ankle or
wrist • Monthly income benefit for life equal to
basic monthly pension – This is effective
(c) Permanent complete paralysis of 2 limbs from date of disability;
(d) Brain injury resulting in incurable • If member is in service at the time of
imbecility or insanity disability and he has paid at least 180
(e) Such other cases as may be determined monthly contributions, in addition to the
by the GSIS monthly income benefit, he shall receive
an additional cash payment of 18 times
basic monthly pension.
Disabilities Deemed Partial and Permanent
[Sec. 17]
To the ineligible
(a) Complete and permanent loss of the use
of: If member has rendered at least 3 years of
service, then he shall receive cash payment
(i) Any finger equal to 100% of ave. monthly compensation
(ii) Any toe for each year of service [essentially total
amount of contributions made] or P12,000
(iii) One arm whichever is higher. [Sec. 16]
(iv) One hand
(v) One foot Partial Disability
(vi) One leg Paid according to GSIS prescribed schedule
(vii) One or both ears (this is similar to the scheme used by SSS);
member availing of permanent partial
(viii) Hearing of one or both ears disability must satisfy condition regarding the
(ix) Sight of one eye disability not being due to his own fault and
either regarding employment status and
(b) Such other cases as may be determined services rendered. (See Eligibility
by the GSIS requirements for Permanent Total Disability)
(c) Even if separated from the service, he Eligibility requirements and other
has paid 180 monthly contributions conditions:
prior to death.
(1) Employee must be:
(2) Survivorship pension plus cash payment
(a) in service at the time of disability; or
of 100% ave. monthly compensation for
every year of service (pension plus total (b) if separated, he has rendered at least
contributions made) 3 years of service and paid at least 6
monthly contributions in the 12
(a) If he was in the service when he died;
month period immediately prior to
and
disability;
(b) With 3 years of service.
(2) All sick leave credits including CBA sick
(3) Cash payment equivalent to 100% ave. leaves for the current year has been used
monthly compensation for each year of up; and
service he paid contributions or P12,000
(3) Maximum of 120 days per 1 calendar year
whichever is higher
(so maximum permissible for the same
(a) With 3 years of service; and sickness and confinement is 240 days for
2 consecutive years).
(b) He has failed to qualify in the prior 2
schemes.
Benefit
B.3.5. FUNERAL BENEFITS [SEC. 23] 75% of the current daily compensation for
every day or fraction thereof of disability or
The amount shall be fixed by GSIS rules and
P70 whichever is higher.
regulations
Who are entitled:
B.3.8. SEPARATION BENEFITS [SEC. 11]
(1) Active member;
Eligibility requirements
(2) Member separated from service but still
entitled to funeral benefit; (1) 60 years of age, or separation from
service with at least 3 years but not over
(3) Pensioner;
15 years served
(4) Retiree who at the time of retirement was
(2) Below 60 years of age, but at least 15
of pensionable age but opted to retire
years of service rendered.
under RA 1616.
Benefit
(1) For 60 years of age or separated from
B.3.6. LOAN
service with 3 to 15 years of service: cash
GSIS website provides for this. The following payment of 100% of ave. monthly
are the loans provided online: compensation for each year of service
(total amount of all contributions paid) or
(1) Consolidated Loan
P12,000 whichever is higher.
(2) Policy Loan
(2) Below 60 years of age and at least 15
(3) Emergency Loan years of service: cash payment
(4) Pension Loan equivalent to 18 x [monthly pension] at
the time of resignation or separation plus
an old-age pension benefit equal to basic
B.3.7. TEMPORARY DISABILITY BENEFITS monthly pension.
[SEC. 18]
Similar to sickness.
SSS GSIS
Enabling law RA 1161 as amended by RA 8282: RA 8291 amending PD 1146
Social Security Act of 1997
Employer – any person, natural or juridical, Employer – National government, its
domestic or foreign, who carries on in the political subdivisions, branches,
Philippines any trade business, industry, agencies or instrumentalities, including
undertaking, and uses the services of another government-owned or controlled
person who is under his orders as regards the corporations and financial institutions
employment, except those considered with original charters [GOCCs];
as em ployer under the GSIS. A self- constitutional commissions; and
employed person shall be both employer and judiciary
Definition of employee at the same time.
Terms
Employee – any person who performs Employee – any person receiving
services for an employer in which either or compensation while in service of an
both mental and physical efforts are used and employer whether by election or
who receives compensation for such services, appointment, irrespective of status of
where there is an employer—employee appointment; baranggay officials; and
relationship; also, a self-employed person sangguniang officials
who is both employee and employer at the
same time
SSS GSIS
Self-employed – any person whose income is Note: No counterpart for self-
not derived from employment, including, but employed.
not limited to:
• self-employed professionals;
• partners and single proprietors of
businesses;
• actors, directors, scriptwriters, news
correspondents not considered as
employees under the above definition;
• athletes, coaches, trainers, jockeys; and
• individual farmers and fishers.
Dependents: Same, except that a child here is below
• Legal spouse entitled by law to receive 18
support;
• Child – unmarried, not gainfully
employed, and below 21 or
• Child over 21 if he or she became
permanently incapacitated and
incapable of self-support, physically or
mentally,; child may be legitimate,
legitimated, legally adopted, or
illegitimate;
• Parent who is receiving regular support.
Beneficiaries Same except that RA 8291 does not
Primary distinguish share of legitimate and
• Dependent spouse – until remarriage illegitimate children
[see above];
• Dependent children [see above];
illegitimate children are entitled only to
50% of the share of legitimate children
unless there are no legitimate children,
in which case, they get 100%.
Secondary
• Shall only receive when the primary
beneficiaries are absent: Dependent
parents
Other
• Any other person designated by the
member as his/her secondary
beneficiary.
Compensation – all actual remuneration Compensation – basic pay received
for employment, including living allowance, excluding per diems, bonuses, overtime,
as well as the cash value of any remuneration honoraria, allowances and other
paid in any medium other than cash except emoluments not integrated into the
that portion already above the max salary basic pay under existing laws.
credit under Sec. 18 of the Act.
Compulsory Public sector employees below the
• Employers as defined above; compulsory retirement age of 65.
• Employees not over 60 years including
Coverage Exceptions:
household helpers with at least P1,000
monthly pay; and (1) AFP and PNP;
• Self-employed. (2) Members of the Judiciary and
PAGE 138 OF 222
UP LAW BOC LABOR STANDARDS LABOR LAW
SSS GSIS
Constitutional Commissions who
Voluntary are covered only by life insurance as
• Spouses who devote full time to they have separate retirement
managing household and family affairs; schemes;
• OFWs recruited by foreign-based (3) Contractual employees with no
employers; employee-employer relationship
• Employees already separated from with the agency they serve.
employment or those self-employed with
no realized income for a given month,
who chose to continue with contributions
to maintain right to full benefit.
Note: Foreign governments, international
organizations or their wholly owned
instrumentality employing workers in the
Philippines may enter into an agreement with
the Philippine government to include their
employees in the SSS except those already
covered by their civil service retirement
system.
Employer: 1st day of operation
Effective Date
Employee: 1st day at work
of Coverage
Self-employed: upon registration with SSS
(1) Monthly pension (1) Monthly pension
(2) Dependents’ pension (2) Retirement benefits
(3) Retirement benefits (3) Permanent disability benefits
(4) Permanent disability benefits (4) Death Benefits
(5) Death benefits (5) Funeral benefits
(6) Funeral benefits (6) Loan – GSIS website provides for
(7) Loan – Social Security Commission this
Resolution No. 669. Moreover, several (7) Temporary disability benefits
SSS-issued circulars such as Circular No. [similar to sickness]
Summary of
21-P and No. 52 pertain to the treatment (8) Separation benefits
Benefits
of salary loans, sometimes providing for (9) Unemployment benefits – Sec 11
more flexible payment terms or (10) Survivorship benefits
condonation for delinquent payers; (11) Life insurance benefits
Santiago v. CA and SSS, GR # L-39949
[1984] resolved an issue involving the Note: Judiciary and Constitutional
treatment of salary loan repayments; SSS Commissions are entitled to life
website also shows loans insurance only.
(8) Sickness benefits
(9) Maternity leave benefits
Effects of (1) Employer’s contribution, and Continued membership for the
separation (2) Employee’s obligation to pay contribution unemployed member; and entitlement
from both cease at the end of the month of to whatever benefits he has qualified to
employment separation; in the event of any compensable
(3) Employee shall be credited with all contingency.
contributions paid on his behalf and
entitled to all benefits set forth by law.
Social Security Commission àCA [Rule 43; GSIS à CA [Rule 43]à SC [Rule 45];
Dispute
questions of law and fact] à SC [Rule 45; appeal does not stay execution.
Settlement
questions of law only]
Prescriptive 20 years 4 years
Period
PAGE 139 OF 222
UP LAW BOC LABOR STANDARDS LABOR LAW
C. LIMITED PORTABILITY LAW [RA (3) An employee over sixty (60) years of age
7699] shall be covered if he had been paying
contributions to the System prior to age
sixty (60) and has not been compulsorily
C.1 COVERAGE [SEC. 3] retired.
(1) Workers who transfer employment from (4) An employee who is coverable by both
one sector to another; or the GSIS and SSS shall be compulsorily
covered by both Systems.
(2) Those employed in both sectors (public
and private). (5) Filipinos working abroad in the service of
an employer as defined in Section 3
hereof shall be covered by the System,
C.2. PROCESS and entitled to the same benefits as are
provided for employees working in the
The covered worker shall have his credible
Philippines. [Sec. 5, Rule I]
services or contributions in both Systems
credited to his service or contribution record
in each of the Systems and shall be totalized
for purposes of old-age, disability, D.2. EFFECTIVITY [SEC. 6, RULE I]
survivorship and other benefits in case the Coverage of employees shall take effect on
covered member does not qualify for such the first day of employment.
benefits in either or both systems without
totalization: Provided, however, That
overlapping periods of membership shall be D.3. WHEN COMPENSABLE
credited only once for purposes of totalization
Grounds [Sec. 1, Rule III]
[Sec. 3]
(1) For the injury and the resulting disability
“Totalization” shall refer to the process of
or death to be compensable, the injury
adding up the periods of creditable services
must be the result of accident arising out
or contributions under each of the Systems,
of and in the course of the employment.
for purposes of eligibility and computation of
benefits [Sec. 2(e)]. (2) For the sickness and the resulting
disability or death to be compensable,
Overlapping periods of membership in case
the sickness must be the result of an
of those employed in both sectors at once are
occupational disease listed under Annex
to be counted only ONCE for purposes of
“A” of these Rules with the conditions set
totalization to be able to satisfy eligibility
therein satisfied, otherwise, proof must
requirements of benefits provided for by
be shown that the risk of contracting the
either SSS or GSIS. [Sec. 3]
disease is increased by the working
conditions.
D. EMPLOYEE’S COMPENSATION –
COVERAGE AND WHEN Limitation [Sec. 1, Rule IV]
COMPENSABLE No compensation shall be allowed to the
This refers to the Amended Rules on employee or his dependents when the injury,
Employees’ Compensation, implementing sickness, disability, or death was occasioned
Title II, Book IV of the Labor Code. by any of the following:
(1) his intoxication;
D.1 COVERAGE [SEC. 2, RULE I] (2) his willful intention to injure or kill
(1) Every employer shall be covered. himself or another; or
(2) Every employee not over sixty (60) years (3) his notorious negligence
of age shall be covered.
LABOR LAW
LABOR RELATIONS
(4) Aliens
I. W HO CANNOT FORM, JOIN OR
General rule: All aliens, natural or juridical, ASSIST LABOR ORGANIZATIONS
[…] are strictly prohibited from engaging
(1) Managerial employees
directly or indirectly in all forms of trade
union activities. [Art. 284] (2) Confidential employees
Exception: Aliens may exercise the right to (3) Non-employees
self-organization and join or assist labor
(4) Member-employee of a cooperative
unions for purposes of collective bargaining,
provided the following requisites are fulfilled: (5) Employees of international organizations
1. With valid working permits issued by the (6) High-level government employees
DOLE; and (7) Members of the AFP, police officers,
2. They are nationals of a country which policemen, firemen and jail guards
grants the same or similar rights to
Filipino workers.
Function Test: Nom enclature is not Members of cooperatives are not eligible […]
controlling even though they do not participate in the
actual management of the cooperative.
The mere fact that an employee is designated
Irrespective of their degree of participation,
“manager” does not ipso facto make him one.
they are still co-owners [Benguet Electric
Designation should be reconciled with the
Cooperative v. Ferrer-Calleja, G.R. No. 79025
actual job description of the employee. [Paper
(1989)]
Industries Corp. of the Philippines. v.
Laguesma, G. R. No.101738, 2000] Exception:
Employees who withdrew their membership
from the cooperative are entitled to form or
Confidential information: Must relate
join a labor union for the negotiations of a
to labor relations and not from a
Collective Bargaining Agreement. [CENECO v.
business standpoint
DOLE, G.R. No. 94045 (1991)]
An employee must assist or act in a
confidential capacity and obtain confidential
information relating to labor relations policies. (5) Employees of International
Exposure to internal business operations of Organizations
the company is not per se a ground for the
International organizations are endowed with
exclusion in the bargaining unit. [Tunay na
some degree of international legal
Pagkakaisa ng Manggagawa sa Asia Brewery
personality. They are granted jurisdictional
v. Asia Brewery, G.R. No. 162025, 2010]
immunity.
Immunity […] is granted to avoid interference
(3) Non-Employees by the host country in their internal workings.
The determination [by the executive branch]
Persons who are not employees of a company
has been held to be a political question
are not entitled to the constitutional right to
conclusive upon the Courts in order not to
join or form a labor organization for purposes
embarrass a political department of
of collective bargaining. The question of
Government. [Hence], a certification election
whether employer-employee relationship
cannot be conducted in an international
exists is a primordial consideration before
organization to which the Philippine
extending labor benefits under the
Government has granted immunity from local
workmen's compensation, social security,
jurisdiction. [International Catholic Migration
Medicare, termination pay and labor relations
Commission v. Calleja, G.R. No. 85750 (1990)]
law.[…] [Singer Sewing Machine Co. v. Drilon,
G.R. No. 91307, 1991]
But they can still form labor union provided (6) High-level / Managerial
that they are employees of the contractor. A Government Employees
labor union can be established in the
High-level employees of the government
business of the contractor but not the
whose functions are normally considered as
principal employer. [Professor Battad]
policy-making or managerial or whose duties
are of a highly confidential nature shall not
be eligible to join the organization of rank-
(4) Employee-Mem ber of Cooperative
and-file government employees. [Sec. 3, E.O.
General Rule: 180]
Employees who at the same time are
members of an electric cooperative are not
(7) Members of the AFP, Policemen,
entitled to form or join unions for purposes of
Police Officers, Firemen and
collective bargaining agreement, for certainly
Jailguards
an owner cannot bargain with himself or his
co-owners. [Batangas-I Electric Cooperative Members of the AFP, Policemen, Police
Labor Union v. Romeo A. Young, G.R. No. Officers, Firemen and Jailguards are
62386, (1988)] expressly excluded by EO 180 §4 from the
PAGE 146 OF 222
UP LAW BOC LABOR RELATIONS LABOR LAW
coverage of the law which provides guidelines shall have the right, to participate in the
for the exercise of the right to organize of policy and decision-making processes of the
government employees. establishment where they are employed
insofar as said processes will directly affect
their rights, benefits and welfare. For this
A.2. BARGAINING UNIT purpose, workers and employers may form
labor-management councils: Provided, that
Definition
the representatives of the workers in such
“Bargaining Unit” refers to a group of labor-management councils shall be elected
employees sharing mutual interests within a by at least the majority of all employees in
given employer unit, comprised of all or less said establishment. [Art. 267]
than all of the entire body of employees in the
employer unit or any specific occupational or
geographical grouping within such employer CBA Coverage
unit. [Sec. 1(d), Rule I, Book V] When there has been a factual determination
It is “a group of employees of a given by the Labor Arbiter that the petitioners were
employer comprised of all or less than all of regular employees, said employees shall fall
the entire body of employees, which the within the coverage of the bargaining unit
collective interests of all the employees and are therefore entitled to CBA benefits as
indicate to be best suited to serve reciprocal a matter of law and contract. [Farley Fulache,
rights and duties of the parties consistent et al. v. ABS-CBN, G.R. No. 183810, 2010]
with equity to the employer. [Belyca Corp. v.
Calleja, G.R. No. 77395 (1988) citing
Rothenberg] Effect of Prior Agreement
[A prior agreement] as to the exclusion [of
workers] from the bargaining […] can never
Functions of an Appropriate bind subsequent federations and unions as
Bargaining Unit [employees were not privy to that
(1) An ELECTORAL DISTRICT. – It marks the agreement]. And even if [they were privy], it
boundaries of those who may participate can never bind subsequent federations and
in a certification election. unions because it is a curtailment of the right
to selforganization guaranteed by the labor
(2) An ECONOMIC UNIT. – They are a group
laws [General Rubber & Footwear Corp. v.
of employees with community of interests.
BLR, G.R. No. 74262, (1987)]
(3) A SOVEREIGN BODY. – It selects the sole
and exclusive bargaining agent.
Rationale
It is a curtailment of the right to self-
Role of a bargaining unit
organization. During the freedom period, the
The labor organization designated or parties may not only renew the existing
selected by the majority of the employees in collective bargaining agreement but may also
an appropriate collective bargaining unit propose and discuss modifications or
shall be the exclusive representative of the amendments thereto. [DLSU v. DLSUEA, G.R.
employees of such unit for the purpose of No. 109002, (2000)]
collective bargaining. [Art. 267]
deemed removed from the list of membership facilities are in the same compound are
of said union. [Art. 256] NOT sufficient to justify piercing the
corporate veil. (Indophil Textile Mills
Exception: Unless such mingling was brought
Workers Union v. Calica, 1992; Diatagon
about by misrepresentation, false statement
Labor Federation v. Ople, 1980)
or fraud under Article 247 (Grounds for
cancellation of Union Registration) of the
Labor Code. [SMCC-Super v. Charter
Spun-off corporations
Chemical and Coating Corporation, G.R. No.
169717 (2011)] The transformation of companies is a
management prerogative and business
judgment which the courts cannot look into
Corporate Entities unless it is contrary to law, public policy or
morals. If, considering the spin-offs, the
General Rule: Two companies having
companies would consequently have their
separate juridical personalities shall NOT be
respective and distinctive concerns in terms
treated as a single bargaining unit. [Diatagon
of nature of work, wages, hours of work and
Labor Federation Local v. Ople, G.R. No. L-
other conditions of employment. The nature
44493-94 (1980)]
of their products and scales of business may
Exception: Pervasive Unitary Aspect require different skills, volumes of work, and
of Managem ent Doctrine working conditions which must necessarily be
commensurate by different compensation
The cross-linking of the agencies command,
packages. (San Miguel Union v Confesor,
control, and communication systems indicate
1996)
their unitary corporate personality.
Accordingly, the veil of corporate fiction
should be lifted for the purpose of allowing
the employees of the three agencies to form a A.2.A. TEST TO DETERMINE THE
single labor union. [Philippine Scouts Veterans CONSTITUENCY OF AN APPROPRIATE
v. Torres, G.R. No. 92357 (1993)] BARGAINING UNIT
4 Factors:
Principles in determining whether to (1) Will of the Employees (Globe Doctrine)
establish separate bargaining units (2) Affinity and unity of employees’ interest
(1) The existence of a bona fide business (Substantial Mutual Interests Rule)
relationship between the 2 companies is (3) Prior collective bargaining history
not proof of being a single corporate
entity, especially when the services (4) Employment status [Democratic Labor
provided by the other company are merely Association v. Cebu Stevedoring Co. Inc,
auxiliary. G.R. No. L-10321, (1958)] [UP v Ferrer-
Calleja, (1992)]
(2) The fact that there are as many
bargaining units as there are companies Note: Of these 4 factors, the court has
in a conglomeration of companies is a identified that it is the 2nd factor which has
positive proof that a corporation is emerged as the standard in determining the
endowed with a legal personality proper constituency of a collective bargaining
DISTINCTLY ITS OWN, independent and unit.
separate from other corporations. Other factors:
(3) Separate legitimate purposes militate (5) Geography and Location
against treating one corporation as an
adjunct or alter ego of the other. (6) Policy of avoiding fragmentation of the
bargaining unit
(4) The fact that the businesses are related,
that some of the employees are the same
persons working in the other company
and the physical plants, offices and
PAGE 148 OF 222
UP LAW BOC LABOR RELATIONS LABOR LAW
It is a fundamental postulate that the will of (4) Employer (when requested to bargain
the majority given expression in an honest collectively and no existing CBA)
election with freedom on the part of the
voters to make their choice, is controlling.
[PLUM Federation of Industrial and Agrarian (1) Legitim ate Labor Organization
Workers v. Noriel, G.R. No. L-48007 (1978)]
"Legitimate labor organization" means any
It is not litigation, but a mere investigation of labor organization duly registered with the
a non-adversary. The determination of the Department of Labor and Employment, and
proceeding does not entail the entry of includes any branch or local thereof. [Art. 219
remedial orders or redress of rights, but (h)]
culmination solely in an official designation of
bargaining units and an affirmation of the
employees expressed choice of bargaining (2) Local/Chapter
agent. [Young Men Labor Union Stevedores v. A duly registered federation or national union
CIR, G.R. No. L-20307 (1965)] may directly create a local chapter by issuing
Technical rules and objections should not a charter certificate indicating the
hamper the correct ascertainment of the establishment of the local chapter. The
labor union that has the support or chapter shall acquire legal personality only
confidence of the majority of the workers and for purposes of filing a petition for
is thus entitled to represent them in their certification election from the date it was
dealings with management. [Port Workers issued a charter certificate. [Art. 241]
Union v. Laguesma, G.R. Nos. 94929-30,
(1992)]
(3) National Union/Federation
A group of legitimate labor unions in a
Certification Election Union Election private establishment organized for collective
To determine the To elect union bargaining or for dealing with employers
Exclusive Bargaining officers concerning terms and conditions of
Agent employment for their member union or for
participating in the formulation of social and
All members of the Only union employment policies, standards and
appropriate bargaining members may programs, registered with the BLR in
unit may vote. vote. accordance with Rule III Sec. 2-B of the IRR.
[Book V Rule 1 Sec. 1 (kk)]
(4) Employer
W ho may file a petition for
certification election [Sec. 1, Rule VIII, Requisites:
Book V] 1. Employer is requested to bargain
(1) Legitimate labor organization collectively; AND
(2) Local/chapter that has been issued a 2. No existing registered CBA in the unit
charter certificate (Art. 270)
The employer’s participation shall be limited Two or more petitions involving same
to: bargaining unit
(1) being notified or informed of petitions Automatically consolidated
Filed in one
of such nature with Med-Arbiter who first
Regional Office
acquired jurisdiction
(2) submitting the list of employees during
the pre-election conference should the Regional Office in which the
Med-arbiter act favorably on the petition was first filed shall
Filed in different
petition [Art. 271] exclude all others; Latter
Regional Offices
shall indorse the petition to
The principle of bystander shall be strictly the former for consolidation
observed throughout the conduct of
certification election. The employer shall not
harass, intimidate, threat, or coerce CERTIFICATION ELECTION IN AN
employees before, during and after elections. UNORGANIZED ESTABLISHMENT
[Sec. 1, Rule IX, Book V]
Unorganized Establishment
However, manifestation of facts that would
aid the mediator-arbiter in expeditiously It is an establishment where there is no
resolving the petition such as existence of bar certified bargaining agent. [Art. 269]
rule may be considered. [Sec. 1, Rule VIII, Procedure [Art. 269]
Book V]
(1) File a petition for certification election.
The employer is not a party to a certification
election, which is the sole or exclusive (2) Upon filing of the petition, the Med-
concern of the workers. The only instance Arbiter shall automatically conduct a
when the employer may be involved in that certification election.
process is when it is obliged to file a petition Filing of petition is by a legitim ate
for certification election on its workers’ labor organization
request to bargain collectively pursuant to
Art. 258. [Hercules Industries, Inc. v Sec. of It cannot be an unregistered labor
Labor, G.R. No. 96255 (1992)] organization. This is best read in relation to
Art. 242 which enumerates the rights granted
The employer is a total stranger in the to a legitimate labor organization and one of
process of certification election. The employer those rights is the right to be chosen as the
has no standing to file a motion to dismiss. exclusive bargaining representative. This is
[PT&T v Laguesma, G.R. No. 101730 (1993)] one way the law encourages union
A company’s interference in the Certification registration.
Election creates a suspicion that it intends to
establish a company union. [Oriental Tin Can
Labor Union v. Secretary of Labor, G.R. No. CERTIFICATION ELECTION IN AN
116751 (1998)] ORGANIZED ESTABLISHMENT
Organized Establishm ent
Venue for filing the petition Refers to an enterprise where there exists a
recognized or certified sole and exclusive
File with the Regional office which issued the bargaining agent. [Sec. 1(ll), Rule I, Book V]
petitioning union’s certificate of registration
or creation of chartered local. Procedure [Art. 268]
At petitioner’s option, it may file the petition (1) File a verified petition questioning the
with the supporting documents online. [Sec. majority.
2, Rule VIII, Book V] (2) It must be filed within the 60-day period
before expiration of CBA (freedom period)
Posting of notice of Petition for (f) Directive to the employer and the
Certificate Election contending unions to submit within ten
(10) days from receipt of order:
This is the responsibility of the regional
direction and his/her authorized (i) The certified list of employees in the
representatives. [Sec. 7, Rule VIII, Book V] bargaining unit, or
(ii) Payrolls covering the members of the
bargaining unit for the last three (3)
(5) Order or decision on the petition
months prior to the issuance of the
Mediator-Arbiter shall issue a ruling granting order, where necessary
or denying the petition
W hen
(6) Appealing the order granting or
• General rule: Within ten (10) days from denying the conduct of
last hearing certification election [Sec. 19-20,
Rule VIII, Book V]
• Exception: In organized
establishments, grant of petition only Organized Dismissed
after lapse of the freedom period or denied
Appeal to
Granted
How Office of
Secretary
• Personally to the parties Unorganized Dismissed
or denied
• Copy furnished to the employer Granted Unappealable
The ruling for the conduct of a W hen filed
certification election shall state the Within ten (10) days from receipt.
following:
W here filed
(a) Name of employer or establishment;
Regional Office where the petition originated
(b) Description of the bargaining unit;
Form of appeal
(c) Statement that none of the grounds for
dismissal; stated in Section 14 exists; • Verified under oath
(d) Names of the contending labor unions • With memorandum of appeal specifically
which shall appear in the following order: stating the grounds relied upon by
(i) Petitioner unions in the order of the appellant
date of filing of their respective • With the supporting arguments and
petitions evidence
(ii) The forced intervenor Effect of filing memorandum of
(iii) “No union” appeal
(e) If the local/chapter is one the contending Stays the holding of any certification election.
unions, a directive to personally submit to [Sec. 23, Rule VIII, Book V]
the election officer its certificate of Reply to Appeal
creation at least five (5) working days
before the actual conduct of the Reply by any party to the petition shall be
certification election. This is to afford an filed within ten (10) days from receipt and
individual employee-voter an informed filed directly with the office of the Secretary.
choice. [Sec. 22, Rule VIII, Book V]
[Airtime Specialists, Inc. v Ferrer-Calleja, G.R. WHO: Election Officer and/or authorized
No. 80612-16 (1990)] DOLE personnel shall cause the posting
WHAT: Notice of election
Rationale for Non-Distinction Policy WHERE: 2 conspicuous places in company
premises
Collective bargaining covers all aspects of the
employment relation and the resultant CBA WHEN: At least ten (10) days before actual
binds all employees in the bargaining unit. election
All rank and file employees, probationary or
Contents of Notice
permanent, have a substantial interest in the
selection of the bargaining representative. (1) Date, time and venue/s of election
[Airtime Specialists, Inc. v Ferrer-Calleja, G.R. (preferably within the establishment);
No. 80612-16 (1990)]
(2) Names of all contending unions;
Dismissed employees [Sec. 6, Rule IX,
(3) Description of the bargaining unit
Book V]
(4) List of eligible and challenged Voters.
General Rule: Dismissed employees who
contested legality of dismissal in a forum of Posting of list of employees
appropriate jurisdiction at the time of comprising the bargaining unit
issuance of order for conduct of a certificate Shall be done by the DOLE personnel
election
W hat cannot be waived by contending
Exception: The dismissal was declared valid unions or employer
in a final judgment at the time of the conduct
of the certification election. (1) Posting of the notice of election
Disagreement over voters’ list over (2) Information required to be included
eligibility of voters [Sec. 6, Rule IX, Book therein
V] (3) Duration of the posting
All contested voters shall be allowed to vote The election shall be set on a regular
but their votes shall be segregated and business day. [IRR, Book V Rule IX Sec. 2]
sealed in individual envelopes.
The parties agreed to conduct the election on
Voting List and Voters a regular business day but a strike was held
The basis of determining voters may be on that day. The alleged strike and/or
agreed upon by the parties (i.e. the use of picketing of some employees at the
payroll). [Acoje Workers Union v NAMAWU, company’s premises which coincided with the
G.R. No. L-18848 (1963)] actual conduct of certification election might,
perhaps have affected the actual
Non-participation in previous election performance of works by some employees,
has no effect but did not necessarily make said date an
Failure to take part in previous elections is no irregular business day of the company. [Asian
bar to the right to participate in future Design and Manufacturing Corp. vs.
elections. No law, administrative rule or FerrerCalleja, G.R. No. L-77415 (1989)]
precedent prescribes forfeiture of the right to
vote by reason of neglect to exercise the right
in past cases. [Reyes v. Trajano, G.R. No. (9) Conduct of Election
84433 (1992)] Inspection to ensure secrecy and
sanctity of ballot [Sec. 8, Rule IX, Book V]
NOTICE REQUIREMENT [Sec. 7, Rule IX, Who:
Book V]
• Election Officer;
Posting of Notice
• Union’s authorized representative;
and
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Election Officer shall prepare the ballots in: Ballot of the voter who has been properly
challenged during the pre-election
(a) English; and conferences shall be:
(b) Filipino or local dialect (a) Placed in an envelope sealed by
Number of ballots should correspond to the Election Officer in the presence of:
number of voters in the bargaining unit plus a (i) the voter; and
reasonable number of extra ballots for
contingencies (ii) representatives of the contending
unions.
All ballots shall be signed at the back by:
(b) Election officer shall indicate on the
(a) Election Officer; and envelope the:
(b) An authorized representative each of (i) Voter’s name;
the contending unions
(ii) Union challenging the voter; and
Refusal or failure of party to sign
ballots (iii) Ground for the challenge
Party waives its right to do so and election (c) Sealed envelope shall be signed by:
officer shall enter the fact of refusal or failure (i) Election Officer; and
and the reason therefor in the records of the
case (ii) Representatives of the
contending unions
Casting of Votes [Sec. 10, Rule IX, Book V]
Election Officer shall:
Voter must put:
(a) Note all challenges in the minutes of the
(a) Cross (x) election proceedings; and
(b) Check (✓) (b) Have custody of all envelopes containing
Where: Square opposite the the challenged votes
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Opening of envelopes and question of technicalities regarding the period for filing
eligibility their protest [within the 5-day period] should
not be taken against them. Mere
Shall be passed upon by the mediator-arbiter
technicalities should not be allowed to prevail
only if the number of segregated votes will
over the welfare of the workers. What is
materially alter the results of the election.
essential is that they be accorded an
On-the-spot Questions opportunity to determine freely and
intelligently which labor organization shall
What the election officer shall rule on:
act on their behalf. [DHL-URFA-FFW v. BMP,
Any question relating to and raised during G.R. No. 152094 (2004)]
the conduct of election
Note: [Sec. 1(p), Rule I, Book V]
What the election officer SHALL NOT rule on:
Election Proceedings refer to the period
Question of eligibility which shall be decided
Included:
by the Mediator-Arbiter
(a) Starting from the opening to the closing
Failure of any party or em ployer or
of the polls
representatives to appear
(b) Counting, tabulation and consolidation of
This is deemed a waiver to be present and to
votes
question the conduct.
Excluded:
(a) Period for the final determination of
(11) Protesting [Sec. 13, Rule IX, Book V]
the challenged votes
Who may file: Any party-in-interest
(b) Canvass
Ground: On the conduct or mechanics of
election
(12) Canvassing of Votes [Sec. 14, Rule IX,
How to protest:
Book V]
(1) Record the protest in the minutes of the
Election precincts shall open and close on the
election proceedings; AND
date and time agreed upon during the pre-
(2) Formalize and perfect the protest election conference.
Within five (5) days after the close of the After precincts have closed, the opening and
election proceedings, formalize the canvass shall immediately proceed.
protest with specific grounds, arguments
before the Med-Arbiter. • Election officer shall count and tabulate
the votes in the presence of the
Protests deemed dropped representatives of the contending unions.
Protests which are: • Upon completion of canvass, the election
(1) Not recorded in the minutes; AND officer shall give each representative a
copy of the minutes of the election
(2) Formalized within the prescribed period proceedings and results of the election.
General Reservation to file protest prohibited • Ballots and tally sheets shall be sealed in
Protesting party shall specify the grounds for an envelope and signed by the election
protest. officer and the representatives of the
contending unions and transmitted to the
Failure to formalize within 5- days cannot be Med-Arbiter together with the minutes
taken against the union. and results of the election within twenty-
The union misrepresented that they were four (24) hours from the completion of the
independent which caused the members to canvass.
disaffiliate and form a new union and their
protest was not filed within the 5-day period.
The failure to follow strictly the procedural
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Election conducted in more than one region (2) There are no material challenged votes
Consolidation of results shall be made within
fifteen (15) days from the conduct.
Effect of Failure of Election [Sec. 19, Rule IX,
Book V]
(13) Certification of the Collective
Shall not bar the filing of a motion for the
Bargaining Agent [Sec. 17, Rule IX, Book
immediate holding of another certification or
V]
consent election within six (6) months from
Double Majority Rule date of declaration of failure of election.
1. There must be a valid election; and Motion for another election after failure of
election [Sec. 20, Rule IX, Book V]
Valid Election: At least majority of the
number of eligible voters have casted Within twenty-four (24) hours from receipt,
their votes Election Officer shall:
2. The winning union must garner majority • Immediately schedule another
of the VALID votes election within fifteen (15) days from
Winning union certifies as SEBA if there is no receipt of motion
protest • Cause posting of notice of election
The winning union shall be certified as the o At least ten (10) days prior to the
SEBA within five (5) days from date of schedule date of election
election, provided that there is no protest
recorded in the minutes of the election. o In two (2) most conspicuous
places in the establishment
When winning choice is local chapter without
certificate of creation Same guidelines and list of voters shall be
used.
It must submit its DOLE issued certificate of
creation within five (5) days from the
conclusion of election (14) Certification of the Collective
Note: Please note that valid votes Bargaining Agent [Sec. 21, Rule IX, Book
differ from mere votes as the former V]
excludes spoiled ballots. The Med-Arbiter shall issue an order
Abstention: Refers to a blank or unfilled proclaiming the results of the election and
vote validly cast by an eligible voter. It is not certifying the union as the sole and exclusive
considered as a negative vote. However, it bargaining agent under any of the following
shall be considered a valid vote for purposes conditions:
of determining a valid election. [Sec. 1(a), (a) No protests were filed, or if one was filed,
Rule I, Book V] it was not perfected within the five-day
Spoiled Ballot: Refers to a ballot that is period
torn, defaced, or contains markings which (b) No challenge or eligibility issue was
can lead another to clearly identify the voter raised, or if one was raised the resolution
who casts such vote. [Sec. 1(a), Rule I, Book V] will not materially change the results of
the elections.
Failure of Election [Sec. 17, Rule IX, Book V] Winning union shall have the rights,
privileges, and obligations of a duly certified
The Election Officer shall declare a failure of collective bargaining agent from the time the
election in the minutes of the election certification is issued.
proceedings when:
Majority of valid votes cast results in
(1) Number of votes cast is less than the “no Union” obtaining majority
majority of the number of eligible voters;
AND
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Med-Arbiter shall declare such fact in the negotiations in good faith with the
order employer
(3) In accordance with Art. 261 of the Labor
Code (Book V, Rule VIII, Sec 3 [b])
(15) Appeal from Certification
Election Orders [Art. 272] (3) Deadlock bar rule
WHO APPEALS: Any party to an election No certification of election may be filed when:
WHAT IS APPEALED: Order or results of the (1) The incumbent or certified bargaining
election agent is a party;
APPEAL TO: Directly to SOLE (2) A bargaining deadlock had been:
GROUND: Rules and regulations established (a) submitted to conciliation or
by the SOLE for the conduct of election have arbitration or;
been violated.
(b) Had become the subject of a valid
notice of strike or lockout (Book V,
Rule VIII, Sec. 3 [c])
BARS TO CERTIFICATION ELECTION
A “deadlock” is defined as the counteraction
Petition for certification may be filed:
of things producing entire stoppage; a state
General Rule: Anytime of inaction or of neutralization caused by the
opposition of persons or of factions (as in
Exceptions:
government or voting body); standstill. The
(1) One-year bar rule word is synonymous with the word impasse
(2) Negotiation bar rule which presupposes reasonable effort at good
faith bargaining which, despite noble
(3) Deadlock bar rule intentions, does not conclude in agreement
(4) Contract bar rule between the parties [Divine World University v.
SOLE, G.R. No. 91915 (1992)]
NOTE: See Page 16 for the Grounds for
denying a Petition for Certification Election
(4) Contract Bar Rule
(1) One-year bar rule General Rule: BLR shall not entertain any
petition for certification election or any other
No certification election may be held within 1 action which may disturb the administration
year from the time a valid certification, of DULY REGISTERED existing collective
consent or run-off election has been bargaining agreements affecting the parties.
conducted within the bargaining unit. [Art. 238]
If the order of the Med-Arbiter certifying the Exception:
results of the election has been appealed, the
running of the one-year period shall be (1) When the petition is filed during the
suspended and the reckoning period is the freedom period in Articles 264, 265, and
date when the decision becomes final and 268.
executory. (Book V, Rule VIII, Sec 3 [a]) (2) When the CBA is incomplete
(3) When the CBA is substandard
(2) Negotiation bar rule (4) When the CBA is prematurely renewed
No certification of election may be filed when: (5) When the CBA is unregistered
(1) Within 1 year after the valid certification No petition for certification election may be
election filed after the lapse of the freedom period.
(2) The duly certified union has The old CBA is extended until a new one is
COMMENCED AND SUSTAINED agreed upon by the parties. [Colegio de San
Juan de Letran v. Association of employees, vs. Rubberworld (Phils.), Inc., G.R. No. 153882
G.R. No. 141471, (2000)] (2007)]
Petition for cancellation of union Complaint for unfair labor practice
registration DOES NOT suspend or may be considered a prejudicial
prevent filing of certification election question
A petition for cancellation of union When it is charged that one or more labor
registration shall not: unions participating in the election are being
aided, or are controlled, by the company or
(a) suspend the proceedings for certification
employer [company union] [United CMC
election; nor
Textile Worker’s Union v. BLR, (1984)].
(b) prevent the filing of a petition for
Rationale:
certification election. [Art. 246]
The certification election may lead to the
A certification election can be conducted
selection of an employerdominated or
despite pendency of a petition to cancel the
company union as the employees’ bargaining
union registration certificate. For the fact is
representative, and when the court finds that
that at the time the union, whose registration
said union is employerdominated in the
certificate is sought to be cancelled, filed its
unfair labor practice case, the union selected
petition for certification, it still had legal
would be decertified and the whole election
personality to perform such act absent an
proceedings would be rendered useless and
order directing its cancellation. [Association
nugatory. [B.F. Goodrich Phils. Marikina v. B.F.
of Court of Appeals Employees vs. Calleja, G.R.
Goodrich Confidential and Salaried Employees
No. 94716, (1991)]
Union, G.R. No. L-34069-70, (1973)]
PREJUDICIAL QUESTION
A.2.F. RE-RUN ELECTION
Prejudicial Question Rule [Sec. 18, Rule IX, Book V]
Labor claims cannot proceed Situation Contemplated
independently of:
A certification, consent, or run-off election
• A bankruptcy liquidation proceeding; and results to a tie between two (2) choices.
• SEC suspension order in a rehabilitation Duty of Election Officer
case. The law is clear, upon the creation
of a management committee or the (a) Notify parties of a re-run election
appointment of a rehabilitation receiver, (b) Cause posting of notice within five (5)
all claims for actions “shall be suspended days from said election.
accordingly.” No exception in favor of
W hen will re-run be conducted
labor claims is mentioned in the law.
Since the law makes no distinction or Within ten (10) days after the posting of the
exemptions, neither should this Court notice
Rationale Declared as winner and certified
These claims “would spawn needless Choice receiving the HIGHEST VOTES CAST.
controversy, delays, and confusion.” [Lingkod
Manggagawa sa Rubberworld, AdidasAnglo
Adm ission and Discipline of Mem bers Mem bers who seek destruction of
No arbitrary or excessive initiation union lose right to remain as
fees or fines members
No arbitrary or excessive initiation fees shall Inherent in every labor union, or any
be required of the members of a legitimate organization for that matter, is the right of
labor organization nor shall arbitrary, selfpreservation. When members of a labor
excessive or oppressive fine and forfeiture be union, therefore, sow the seeds of dissension
imposed. [Article 250(e)] and strife within the union; when they seek
the disintegration and destruction of the very
Prohibition on subversive activities or union to which they belong; they thereby
membership forfeit their rights to remain as members of
No labor organization shall knowingly admit the union which they seek to destroy. [Villar v.
as members or continue in membership any Inciong, No. L5028384 (1983)]
individual who:
(a) belongs to a subversive organization; or Election of Officers
(b) who is engaged directly or indirectly in Manner of election
any subversive activity;
Members shall directly elect their officers,
including those of the national union or
Unions cannot arbitrarily exclude federation, to which they or their union is
qualified applicants affiliated, by secret ballot at intervals of five
(5) years. [Art. 250(c)]
Unions are not entitled to arbitrarily exclude
qualified applicants for membership, and a Qualifications of officers
closedshop provision would not justify the No requirements other than membership in
employer in discharging, or a union in good standing. [Art. 250(c)]
insisting upon the discharge of, an employee
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Different types of Attorney’s Fees extraordinary fees may be checked off from
any amount due to an employee without an
Ordinary Extraordinary
individual written authorization duly signed
Reasonable Indemnity for by the employee. The authorization should
compensation paid damages ordered by specifically state the amount, purpose and
to a lawyer for legal the court to be paid beneficiary of the deduction. [Art. 250 (o)]
services rendered by the losing party to Requisites for a Valid Special
the winning party Assessment
Agreed upon by the Awarded by the
parties Court (1) Authorization by a written resolution
Payable to the Payable to the client of the majority of ALL the members at
lawyer the general membership meeting
Not limited (freedom Limited by Art. 111 to called for the purpose;
to contract) 10% (2) Secretary’s record of the minutes of
[Kaisahan at Kapatiran v. Maniwal Water, G.R. the meeting; AND
No. 174179 (2011)]
(3) Individual written authorization for
There are two concepts of attorney's fees. In check off duly signed by the
the ordinary sense, attorney's fees represent employees concerned which indicates
the reasonable compensation paid to a the:
lawyer by his client for the legal services
rendered to the latter. On the other hand, in a. Amount
its extraordinary concept, attorney's fees may b. Purpose
be awarded by the court as indemnity for
damages to be paid by the losing party to the c. Beneficiary of deduction
prevailing party, such that, in any of the cases [Gabriel v. SOLE, G.R. No. 115949 (2000)]
provided by law where such award can be
made, e.g., those authorized in Article 2208 Strict compliance for special
of the Civil Code, the amount is payable not assessment
to the lawyer but to the client, unless they There must be strict and full compliance with
have agreed that the award shall pertain to the requisites. Substantial compliance is not
the lawyer as additional compensation or as enough. [Palacol v. Ferrer-Calleja, G.R. No.
part thereof. [Masmud v NLRC, G.R. No. 85333 (1990)]
183385, (Feb 13, 2009)]
In Masmud, the contingency agreement
between lawyer and client consisting of 39% Mandatory Activity
of the monetary award was deemed not Definition
unconscionable by the SC.
A judicial process of settling dispute laid
down by the law. [Vengco v. Trajano, G.R. No.
A.2.G. SPECIAL ASSESSMENTS 74453 (1989)]
Special assessments are payments for a Placement of renegotiations for a CBA under
special purpose, especially if required only for compulsory process does not make it a
a limited time. [Azucena] “mandatory activity”. [Galvadores v. Trajano,
No. L70067 (1986)]
No special assessment or other extraordinary
fees may be levied upon the members of a It dispenses with the requirement of
labor organization unless authorized by a the individual written authorization
written resolution of a majority of all the duly signed by the employee.
members of a general membership meeting Other than for mandatory activities under the
duly called for the purpose. [Art. 247 (n)] Code, no special assessments, attorney’s
Other than for mandatory activities under the fees, negotiation fees or any other
Code, no special assessments, attorney’s extraordinary fees may be checked off from
fees, negotiation fees or any other any amount due to an employee without an
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The supporting requirements shall be Note: D.O No. 9 defines trade union center
as any group of registered national unions or
• Certified under oath by: federations organized for the mutual aid and
o Secretary; or protection of its members; for assisting such
members in collective bargaining; or for
o Treasurer
participating in the formulation of social and
• Attested by: Its president employment policies, standards, and
programs, and is duly registered with the
[Sec. 1(j), Rule VIII, Book V in relation with DOLE in accordance with Rule III, Section 2 of
Sec. 2-E, Rule III, Book V] the Implementing Rules
Lesser requirements for Chartered locals
When an unregistered union becomes a PURPOSE OF AFFILIATION
branch, local or chapter, some of the
requirements for registration are no longer To foster the free and voluntary organization
necessary or compulsory. Whereas an of a strong and united labor movement [Art.
applicant for registration of an independent 218]
union is mandated to submit, among other The sole essence of affiliation is to increase,
things, the number of employees and names by collective action, the common bargaining
of all its members comprising at least 20% of power of local unions for the effective
the employees in the bargaining unit where it enhancement and protection of their
seeks to operate, the same is no longer interests. Admittedly, there are times when
required of a branch, local or chapter. The without succor and support local unions may
intent of the law in imposing less find it hard, unaided by other support groups,
requirements in the case of a branch or local to secure justice for themselves. [Philippine
of a registered federation or national union is Skylanders, Inc. v. NLRC, G.R. No. 127374,
to encourage the affiliation of a local union (2002)]
with a federation or national union in order to
increase the local unions bargaining powers
respecting terms and conditions of labor. NATURE OF RELATIONSHIP: AGENCY
[SMCEU-PTGWO v. SMPEU-PDMP, G.R. No.
171153 (2007)] The mother union, acting for and in behalf of
its affiliate, had the status of an agent while
Trade Union Centers cannot create locals or the local union remained the basic unit of the
chapters association, free to serve the common
D.O No. 9 mentions only federations or interest of all its members subject only to the
national unions. The solemn power and duty restraints imposed by the constitution and
of the Court to interpret and apply the law by-laws of the association. The same is true
does not include the power to correct by even if the local is not a legitimate labor
reading into the law what is not written organization. [Filipino Pipe and Foundry Corp
therein. v. NLRC, G.R. No. 115180 (1998)]
National Union or Federation v. Trade Unions
National Union or Trade Unions EFFECT OF AFFILIATION
Federation Inclusion of [the federation] in the
With at least ten (10) Composed of a registration is merely to stress that they are
locals or chapters or group of registered its affiliates at the time of registration. It does
affiliates, each of national unions or not mean that said local unions cannot stand
which must be a duly federations on their own. Affiliation does not mean they
certified or lost their own legal personality. [Adamson v
recognized collective CIR, G.R. No. L-35120 (1984)]
bargaining agent
Can directly create Cannot Mere affiliation does not divest the local
local or chapter union of its own personality, neither does it
give the mother federation the license to act
PAGE 170 OF 222
UP LAW BOC LABOR RELATIONS LABOR LAW
independently of the local union. It only gives creation and existence to the national
rise to a contract of agency, where the former federation to which they are affiliated but,
acts in representation of the latter. Hence, instead, to the will of their members. [Liberty
local unions are considered principals while Cotton Mills Workers Union vs. Liberty Cotton
the federation is deemed to be merely their Mills, Inc, G.R. No. L-33987(1975)]
agent. (Insular Hotel Employees Union NFL v
A local union, being a separate and voluntary
Waterfront Insular Hotel, GR No. 174040-41,
association, is free to serve the interests of all
(Sept 22, 2010)]
its members including the freedom to
disaffiliate or declare its autonomy from the
federation which it belongs when
SUPERVISOR AND RANK AND FILE
circumstances warrant, in accordance with
UNION AFFILIATION
the constitutional guarantee of freedom of
Supervisory employees shall not be eligible association. Such disaffiliation cannot be
for membership in the collective bargaining considered disloyalty. In the absence of
unit of the rank-and-file employees …The specific provisions in the federation’s
rank and file union and the supervisors’ union constitution prohibiting disaffiliation or the
operating within the same establishment declaration of autonomy of a local union, a
may join the same federation or national local may dissociate with its parent union.
union. [Art. 255] [MSMG-UWP v. Ramos, (2000)]
General Rule: Supervisory employees and Period of Disaffiliation
rank and file CAN JOIN the same federation
General rule: Anytime
or national union.
Exception: Constitution allows disaffiliation
Before, if the rank-and-file employees are
only during freedom period.
directly under the authority of supervisory
employees AND the national federation is Exception to Exception: When there is a shift
actively involved in union activities in the of allegiance on the part of the majority of the
company, both employees CANNOT join the members of the union. [ANGLO v. Samana,
same federation or union. HOWEVER, these G.R. No. 118562 (1996)]
conditions have been rendered obsolete by
Effect of disaffiliation
RA 9481, amending Art. 255 (then Art. 245)
to include: “The rank and file union and the On legal personality
supervisors' union operating within the same
A registered independent union retains its
establishment may join the same federation
legal personality while a chartered local loses
or national union.”
its legal personality unless it registers itself.
[Volkschel Labor Union v. BLR, No. L45824
(1985)]
DISAFFILIATION
No effect on CBA
Nature of Right and Legality
A disaffiliation does not disturb the
Such a phenomenon is nothing new in the
enforceability and administration of a
Philippine labor movement. Nor is it open to
collective agreement; it does not occasion a
any legal objection. It is implicit in the
change of administrators of the contract nor
freedom of association explicitly ordained by
even an amendment of the provisions
the Constitution. There is then the
thereof. [Volkschel Labor Union v. BLR, No.
incontrovertible right of any individual to join
L45824 (1985)]
an organization of his choice. That option
belongs to him. A workingman is not to be Obligation to pay union dues is coterminous
denied that liberty. [PLAC v. BLR, No. L- with membership
41288 (1977)]
The obligation of an employee to pay union
We upheld the right of local unions to dues is coterminous with his affiliation or
separate from their mother federation on the membership. The employees’ checkoff
ground that as separate and voluntary authorization, even if declared irrevocable, is
associations, local unions do not owe their good only as long as they remain members of
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UP LAW BOC LABOR RELATIONS LABOR LAW
SUBSTITUTIONARY DOCTRINE
Statutory Policies
The “substitutionary” doctrine provides that
the employees cannot revoke the validly (1) To promote and emphasize the primacy
executed collective bargaining contract with of free collective bargaining and
their employer by the simple expedient of negotiations, including voluntary
changing their bargaining agent. And it is in arbitration, mediation and conciliation,
the light of this that the phrase “said new as modes of setting labor or industrial
agent would have to respect said contract” disputes. [Art. 218 (a)]
must be understood. It only means that the (2) It is the policy of the State to promote
employees, thru their new bargaining agent, and emphasize the primacy of free and
cannot renege on their collective bargaining responsible exercise of the right to self-
contract, except of course to negotiate with organization and collective bargaining,
management for the shortening thereof. either through single enterprise level
(Benguet Consolidated v. BCI Employees and negotiations or through the creation of a
Workers Union-PAFLU, 1998) mechanism by which different employers
Conditions to apply the doctrine and recognized certified labor unions in
their establishments bargain collectively.
(1) change of bargaining agent (through [Book V, Rule XVI, §1]
affiliation, disaffiliation, or other means);
and (3) To encourage a truly democratic method
of regulating the relations between the
(2) existing CBA with the previous bargaining employers and employees by means of
agent [Benguet Consolidated v. BCI agreements freely entered into through
Employees and Workers Union-PAFLU, collective bargaining, no court or
G.R. No. L-24711 (1998)] administrative agency or official shall
Effects: have the power to set or fix wages, rates
of pay, hours of work or other terms and
(1) new bargaining agent cannot revoke and
conditions of employment, except as
must respect the existing CBA; and
otherwise provided under this Code [Art.
(2) it may negotiate with management to 218 (b)]
shorten the existing CBA’s lifetime
is one of the democratic frameworks under (2) Proof of majority representation by the
the Labor Code designed to stabilize the representative labor organization
relations between labor and management
(3) Demand to bargain by the labor
and to create a climate of sound and stable
organization [Art. 250(a)]
industrial peace. It is a mutual responsibility
of the employer and the Union and is The employer is only bound to bargain with
characterized as a legal obligation.” [Kiok Loy the appropriate collective bargaining agent.
v. NLRC, 1986] An employer asked by a labor organization
(which is not the SEBA of the establishment)
The institution of collective bargaining is a
to bargain collectively may file a petition for
prime manifestation of industrial democracy
certification election to ascertain the will of
at work. The two parties to the relationship,
the bargaining unit or it may voluntarily
labor and management, make their own rules
recognize the labor organization in proper
by coming to terms to govern themselves in
circumstances.
matters that really count. [United Employees
Union of Gelmart Industries v. Noriel, 1975]
Meaning of Bargaining in Good Faith
W aiver of Right to Collectively [T]here is no per se test of good faith in
Bargain bargaining. Good faith or bad faith is an
inference to be drawn from the facts. [Kiok
The right to free collective bargaining
Loy v NLRC, 1986]
includes the right to suspend it. [Rivera v.
Espiritu, 2000] [T]he failure to reach an agreement after
negotiations have continued for a reasonable
period does not establish a lack of good faith.
B.2 DUTY TO BARGAIN COLLECTIVELY The laws invite and contemplate a collective
bargaining contract, but they do not compel
one. [Tabangao Shell Refinery Employees
I. IN GENERAL Association vs. Pilipinas Shell Petroleum
Corporation, 2014]
Definition
The duty to bargain collectively means the
performance of a mutual obligation to meet Duty to Bargain does not include:
and convene promptly and expeditiously in (1) Any legal duty on the part of the
good faith for the purpose of negotiating an employer to initiate contract negotiation
agreement with respect to wages hours of [Kiok Loy v NLRC, 1986]
work and all other terms and conditions of
employment including proposals for (2) The obligation to reach an agreement.
adjusting any grievances or questions arising While the law makes it an obligation for
under such agreement and executing a the employer and the employees to
contract incorporating such agreement if bargain collectively with each other, such
required by either party but such duty does compulsion does not include the
not compel any party to agree to a proposal commitment to precipitately accept or
or to make any concession. [Art. 263] agree to the proposals of the other. All it
contemplates is that both parties should
approach the negotiation with an open
Jurisdictional Preconditions of Duty to mind and make reasonable effort to
Bargain reach a common ground of agreement.
[Union of Filipro Employees v. Nestle,
(1) Possession of the status of majority 2008]
representation of the employees’
representative in accordance with any of
the means of selection or designation
provided for by the Code
insistence on the disputed clause was not the impasse which, within the meaning of the
sole cause of the failure to agree or that American federal labor laws, “presupposes
agreement was not reached with respect to reasonable effort at good faith bargaining
other disputed clauses.” which, despite noble intentions, does not
conclude in agreement between the parties.”
Such refusal will not be deemed as an unfair
[Divine World Tacloban v Secretary of Labor,
labor practice. However, if a party refuses to
1992]
contract based on an issue which is not a
mandatory bargainable issue, the party will Collective Bargaining Deadlock is defined as
be guilty of ULP. [Samahang Manggagawa sa the situation between the labor and the
Top Form v. NLRC, 1998] management of the company where there is
failure in the collective bargaining
negotiations resulting in a stalemate. [San
Minutes of Negotiation Miguel Corp. v NLRC, 1999].
Where a proposal raised by a contracting
party does not find print in the CBA, it is not a
Privileged Communication in
part thereof and the proponent has no claim
Conciliation Proceedings
whatsoever to its implementation. The
Minutes [only] reflects the proceedings and Information and statements made at
discussions undertaken in the process of conciliation proceedings shall be treated as
bargaining for worker benefits in the same privileged communication and shall not be
way that the minutes of court proceedings used as evidence in the Commission.
show what transpired therein. At the Conciliators and similar officials shall not
negotiations, it is but natural for both testify in any court or body regarding any
management and labor to adopt positions or matters taken up at conciliation proceedings
make demands and offer proposals and conducted by them. [Art. 233]
counter-proposals. However, nothing is
considered final until the parties have
reached an agreement. [Samahang Rationale
Manggagawa sa Top Form v NLRC, 1998]
i. a person is entitled to ‘buy his or her
peace’ without danger of being prejudiced
Suspension of Bargaining in case his or her efforts fail
Negotiations ii. offers for compromise are irrelevant
The mere filing of a petition for certification because they are not intended as
election does not ipso facto justify the admissions by the parties making them
suspension of negotiation by the employer. In [Pentagon Steel v. CA, 2009]
order to allow the employer to validly
suspend the bargaining process there must
be a valid petition for certification election B.4 COLLECTIVE BARGAINING
raising a legitimate representation issue. AGREEMENT (CBA)
[Colegio de San Juan de Letran v. Association
of Employees, 2000]
I. GENERAL CONCEPTS
Definition
Bargaining Deadlock
Collective Bargaining Agreement -
A “deadlock” is defined as the “counteraction refers to the negotiated contract between a
of things producing entire stoppage: a state legitimate labor organization and the
of inaction or of neutralization caused by the employer concerning wages, hours of work
opposition of persons or of factions: a and all other terms and conditions of
standstill. There is a deadlock when there is a employment in a bargaining unit, including
“complete blocking or stoppage resulting mandatory provisions for grievances and
from the action of equal and opposed forces.” arbitration machineries. [Book V Rule I § 1(j)]
The word is synonymous with the word
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UP LAW BOC LABOR RELATIONS LABOR LAW
Nature of the CBA and the courts must place a practical and
realistic construction upon it, giving due
It is a familiar and fundamental doctrine in
consideration to the context in which it is
labor law that the collective bargaining
negotiated and purpose which it is intended
agreement (CBA) constitute the law between
to serve. [Davao Integrated Port Stevedoring
the parties and they are obliged to comply
Services vs. Abarquez, 1993]
with its provisions. [Zuellig Pharma
Corporation vs. Alice Sibal, 2013] General Rule: [W]here the CBA is clear and
unambiguous, it becomes the law between
However, although it is a rule that contract
the parties and compliance therewith is
freely entered between the parties should be
mandated by the express policy of the law.
respected, said rule is not absolute. “The
[Zuellig Pharma Corporation v Alice Sibal,
relations between capital and labor are not
2013]
merely contractual. They are so impressed
with public interest that labor contracts must Exception: If the words appear to be
yield to the common good.” [Civil Code, Art. contrary to the evident intention of the
1700] parties, the latter shall prevail over the
former. [Kimberly Clark Phils. V. Lorredo, 1993]
6. Unresolved grievances arising from the [T]he award or decision of the Voluntary
interpretation and implementation of the Arbitrator […] shall be final and executory
productivity incentives program under RA after 10 calendar days from receipt of the
6971 [Book V, Rule XIX, Sec. 4] copy of the award or decision by the parties.
In general, the arbitrator [“VA”] is expected […] (Art. 276)
to decide those questions expressly stated Motion for Reconsideration
and limited in the submission agreement.
However, since arbitration is the final resort The absence of a categorical language in Art.
for the adjudication of disputes, the arbitrator 276 [then Art. 262-A] does not preclude the
can assume that he has the power to make a filing of a motion for reconsideration of the
final settlement. The VA has plenary VAs decision within the 10-day period. [Teng v
jurisdiction and authority to interpret the CBA Pahagac, G.R. 169704, (Nov. 17, 2010)]
and to determine the scope of his or her own Clearly, before a petition for certiorari under
authority. Subject to judicial review, this Rule 65 of the Rules of Court may be availed
leeway of authority and adequate prerogative of, the filing of a motion for reconsideration is
is aimed at accomplishing the rationale of the a condition sine qua non to afford an
law on voluntary arbitration – speedy labor opportunity for the correction of the error or
justice. [Goya, Inc. vs. Goya, Inc. Employees mistake complained of. So also, considering
Union-FFW, 2013] that a decision of the Secretary of Labor is
Procedure of Voluntary Arbitration subject to judicial review only through a
special civil action of certiorari and, as a rule,
(1) All parties shall be entitled to attend the cannot be resorted to without the aggrieved
arbitration proceedings. party having exhausted administrative
(2) The hearing may be adjourned for cause remedies through a motion for
or upon agreement by the parties. reconsideration, the aggrieved party, must be
allowed to move for a reconsideration of the
(3) Unless the parties agree otherwise, it same so that he can bring a special civil
shall be mandatory for voluntary action for certiorari before the Supreme
arbitrator or panel of voluntary Court. [PIDLTRANCO Service Enterprises Inc v
arbitrators to render an award or decision PWU – AGLO, GR No. 180962, (Feb 26, 2014)]
within twenty (20) calendar days from the
date of submission for resolution [Book V, The rule, therefore, is that a Voluntary
Rule XIX, Sec. 6] Arbitrator’s award or decision shall be
appealed before the Court of Appeals within
Powers of voluntary arbitrators during 10 days from receipt of the award or decision.
arbitration proceeding Should the aggrieved party choose to file a
(1) hold hearings motion for reconsideration with the Voluntary
Arbitrator, the motion must be filed within
(2) receive evidence the same 10-day period since a motion for
(3) take whatever action is necessary to reconsideration is filed "within the period for
resolve the issue or issues subject of taking an appeal." [PHILEC v Court of
dispute, including efforts to effect a Appeals, GR No. 168612, (Dec 10, 2014)]
voluntary settlement between parties Appeal
(4) determine attendance of any third parties While there is an express mode of appeal
(5) determine exclusion of any witness from the decision of a labor arbiter, Republic
Act No. 6715 is silent with respect to an
(6) issue writ of execution for sheriff of NLRC appeal from the decision of a voluntary
or regular courts to execute the final arbitrator.
decision, order, or award (Art 276)
judicial agency, board or commission, still (4) Labor Managem ent Council
both he and the panel are comprehended
Any provision of law to the contrary
within the concept of a "quasi-judicial
notwithstanding, workers shall have the
instrumentality." A fortiori, the decision or
right, subject to such rules and regulations as
award of the voluntary arbitrator or panel of
the Secretary of Labor and Employment may
arbitrators should likewise be appealable to
promulgate, to participate in policy and
the Court of Appeals. [Luzon Development
decision-making processes of the
Bank v. Assoc of Luzon Dev’t Employees, 1995]
establishment where they are employed
The decisions of the voluntary arbitrator are insofar as said processes will directly affect
akin to those of the Regional Trial Court, and their rights, benefits and welfare. For this
therefore should first be appealed to the purpose, workers and employers may form
Court of Appeals before being elevated to labor-management councils. […] [Art. 267]
[the Supreme Court]. [Centro Escolar
Selection of Representatives
University Faculty and Allied Workers Union v.
Court of Appeals, 2006] In organized establishments, the workers’
representatives to the council shall be
Costs
nominated by the exclusive bargaining
The parties to a Collective Bargaining representative. In establishments where no
Agreement shall provide therein a legitimate labor organization exists, the
proportionate sharing scheme on the cost of workers representative shall be elected
the voluntary arbitration including the directly by the employees at large. [Book V,
Voluntary Arbitrators fee. […] [Art. 277] Rule XXI, Sec. 2]
Voluntary Arbitrator's Fee
[…] The fixing of the fee of the Voluntary III. ADMINISTRATION AND ENFORCEMENT
Arbitrators, whether shouldered wholly by OF CBA
the parties or subsidized by the special
Substandard CBA
voluntary arbitration fund, shall take into
account the following factors: A CBA that falls below the minimum
standards required by law is prohibited.
(1) nature of the case
Nonetheless, RA 9481 removed substandard
(2) time consumed in hearing the case CBAs as a ground for the cancellation of
registration of union registration. Note: A
(3) professional standing of the voluntary
substandard CBA cannot bar a petition for
arbitrator
certification election under the contract-bar
(4) capacity to pay of the parties. [Art. 277] rule.
CBA Duration for econom ic provisions justice, is to give preference to the qualified
separated employees in the filling of
3 years.
vacancies in the facilities of the purchaser.
[Manlimos v. NLRC, 1995]
CBA Duration for non-economic
provisions
B.5. UNION SECURITY
5 years for representational or political issues.
(2) Employees already in service at the The closed shop provision is the most prized
time the union security clause took achievement of unionism. However it can also
effect be a potent weapon wielded by the union
against the workers whom the union is
• A [union security] provision in a supposed to protect in the first place. Hence,
CBA is not to be given a any doubt as to the existence of a closed shop
retroactive effect as to preclude provision in the CBA will be resolved in favor
its being applied to employees of the nonexistence of the closed shop
provision. [Azucena]
5) Agency shop
2) Maintenance of m em bership shop It is an arrangement whereby non-members
must pay the union agency fees for the
Condition for continued employment
benefits they received as a consequence of
An agreement where present and future the bargaining efforts of the union.
union members must maintain their
An agreement whereby employees must
membership as a condition for continued
either join the union or pay to the union as
employment until they are promoted or
exclusive bargaining agent a sum equal to
transferred out of the bargaining unit or the
that paid by the members. [Azucena]
agreement is terminated
There is maintenance of membership shop
when employees, who are union members as B.5.C. ENFORCEMENT OF UNION
of the effective date of the agreement, or who SECURITY CLAUSE
thereafter become members, must maintain
Termination due to Union Security
union membership as a condition for [their]
Provision
continued employment until they are
promoted or transferred out of the bargaining Termination of employment by virtue of a
unit or the agreement is terminated. [GMC v. union security clause embodied in a CBA is
Casio, 2010] recognized and accepted in our jurisdiction.
This practice strengthens the union and
No employee is compelled to join the union,
prevents disunity in the bargaining unit
but all present or future members of the
within the duration of the CBA. By preventing
union must, as a condition of employment,
member disaffiliation with the threat of
remain in good standing in the union.
expulsion from the union and the consequent
[Azucena]
termination of employment, the authorized
bargaining representative gains more
numbers and strengthens its position as
3) Union shop
against other unions which may want to
Condition for continued em ploym ent claim majority representation. [Alabang
Country Club v. NLRC, G.R. No. 170287
An agreement where all new regular
(2008)]
employees are required to join the union
within a certain period as a condition for their Requisites for the enforcement of
continued employment. Union Security Clauses
There is union shop when all new regular In terminating the employment of an
employees are required to join the union employee by enforcing the union security
within a certain period as a condition for their clause, the employer needs only to determine
continued employment. [GMC v. Casio, 2010] and prove that:
Non-members may be hired, but to retain 1) The union security clause is
employment, they must become union applicable
members after a certain period. The
2) The union is requesting for the
requirement applies to present and future
enforcement of the union security
employees. [Azucena]
provision in the CBA
3) There is sufficient evidence to support
4) Modified union shop the union’s decision to expel the
employee from the union. [Alabang
Employees who are not union members at
Country Club v. NLRC, 2005]
the time of signing the contract need not join
the union, but all workers hired thereafter
must join. [Azucena]
Four form s of Unfair Labor Practice in management, […] SJCI in effect admitted that
Bargaining it wanted to end the bargaining deadlock and
eliminate the problem dealing with the
(1) Failure or Refusal to meet and convene
demands of the union. [St. John Colleges Inc. v.
(2) Evading the mandatory subjects of St. John Academy Faculty and Employees
bargaining Union, 2006]
(3) Bargaining in bad faith Im plied refusal
(4) Gross violation of the CBA The school is guilty of unfair labor practice
when it failed to make a timely reply to the
proposals of the union more than one month
B.6.A. FAILURE OR REFUSAL TO BARGAIN after the same were submitted by the union.
Statutory Basis of Employers In explaining its failure to reply, the school
merely offered a feeble excuse that its Board
To violate the duty to bargain collectively as of Trustees had not yet convened to discuss
prescribed by this code. [Art. 254 (g)] the matter. Clearly, its actuation showed a
lack of sincere desire to negotiate. [Colegio de
San Juan de Letran v. Association, 2000]
Statutory Basis of Labor
Organizations
(1) To violate the duty, or refuse to bargain Acts not deem ed refusal to bargain
collectively with the employer, provided it (1) Adoption of an adamant bargaining
is the representatives of the employees; position in good faith, particularly where
[Art. 256 (c)] the company is operating at a loss
(2) [I]t shall be the duty of employer and the (2) Refusal to bargain over demands for
representatives of the employees to commission of unfair labor practices
bargain collectively in accordance with
the provisions of this Code. [Art. 257] (3) Refusal to bargain during period of illegal
strike
(4) Not initiating the bargaining
Acts deem ed as refusal to bargain
(5) Refusal to bargain where the union
Refusal to bargain when there is an demands for recognition and bargaining
unresolved petition for union within the year following a certification
cancellation election, and the clear choice is no union
“That there is a pending cancellation and no ad interim significant change has
proceedings against the union is not a bar to taken place in the unit
set in motion the mechanics of collective (6) Refusal to bargain because the other
bargaining. […] Unless [the union’s] party is making unlawful bargaining
certificate of registration and status as the demands
certified bargaining agent is revoked, [the
employer], by express provision of the law,
duty bound to collectively bargain with the B.6.B. EVADING THE MANDATORY
Union.” [Capitol Medical Center v. Trajano, SUBJECTS OF BARGAINING
2005]
The refusal to negotiate a mandatory subject
Employer’s suspension of operations in of bargaining is an unfair labor practice
order to forestall a demand for although either party has every desire to
collective bargaining reach agreement and earnestly and in all
By admitting that the closure [of the good faith bargains to that end. […] However,
business] was due to irreconcilable duty to bargain does not obligate the parties
differences between the Union and the school to make concessions or yield a position fairly
held. [Azucena]
The duty to bargain is limited to mandatory by going through the motions of negotiating
bargaining subjects; as to other matters, he is almost as easily as by bluntly withholding
free to bargain or not to bargain. Over a recognition […] As long as there are unions
mandatory subjects, a party may insist on weak enough to be talked to death, there will
bargaining, even to the point of deadlock, be employers who are tempted to engage in
and his insistence will not be construed as the forms of collective bargaining without the
bargaining in bad faith. substance. [K-MART Corporation v NLRB,
1980 626 F.2d 704
Over a non-mandatory subject, on the other
hand, a party may not insist on bargaining to
the point of impasse, otherwise his insistence
Individual Bargaining
can be construed as bargaining in bad faith.
It is an unfair labor practice for an employer
operating under a CBA to negotiate with his
B.6.C. BARGAINING IN BAD FAITH employees individually. That constitutes
interference because the company is still
The crucial question whether a party has met
under obligation to bargain with the union as
his statutory duty to bargain in good faith
the bargaining representative.
typically turns on the facts of the individual
case. There is no per se test of good faith in Individual bargaining contemplates a
bargaining. Good faith or bad faith is an situation where the employer bargains with
inference to be drawn from the facts of the the union through the employees instead of
case. [Hongkong and Shanghai Banking Corp. the employees through the union. [The Insular
Employees Union v. NLRC, 1997] Life Assurance Co. Ltd., Employees Assn. v.
Insular Life Assurance Co. Ltd, 1971]
GMC’s refusal to make a counter-proposal to
the union’s proposal for CBA negotiation on
the excuse that it felt the union no longer
B.6.D. GROSS VIOLATIONS OF THE CBA
represented the workers is an indication of
bad faith. […] Failing to comply with the Accordingly, violations of a Collective
mandatory obligation to submit a reply to the Bargaining Agreement, except those which
union’s proposals, GMC violated its duty to are gross in character, shall no longer be
bargain collectively, making it liable for unfair treated as unfair labor practice and shall be
labor practice. [GMC v. CA, 2004] resolved as grievances under the Collective
Bargaining Agreement. For purposes of
this article, gross violations of Collective
Blue-Sky Bargaining Bargaining Agreement shall mean flagrant
and/or malicious refusal to comply with the
Blue-Sky Bargaining is defined as "unrealistic
economic provisions of such agreement.
and unreasonable demands in negotiations
by either or both labor and management,
where neither concedes anything and
demands the impossible." It actually is not B.7 UNFAIR LABOR PRACTICE (ULP)
collective bargaining at all. [Standard Bank Unfair labor practice refers to acts that
Chartered Employees Union v. Confesor, 2004] violate the workers’ right to organize. The
prohibited acts are related to the workers’
right to self-organization and to the
Surface Bargaining observance of a CBA. Without that element,
Surface bargaining is defined as "going the acts, no matter how unfair, are not unfair
through the motions of negotiating," without labor practices. The only exception is Art. 259
any real intent to reach an agreement. It (f) [i.e. to dismiss, discharge or otherwise
violates the Act's requirement that parties prejudice or discriminate against an
negotiate in "good faith." It is prohibited employee for having given or being about to
because, as one commentator explained: The give testimony under this Code]. [Philcom
bargaining status of a union can be destroyed Employees Union v. Phil. Global, 2006]
(1) The employee is not only protected An act which restrains, coerces, or interferes
from the employer but also from with employees in the exercise of their right
labor organizations. to self-organization is an Unfair Labor
Practice.
(2) Employer is also protected from ULP
committed by a labor organization. Interrogation
The public is also protected because it has an General rule: employer may interrogate its
interest in continuing industrial peace. employees regarding their union affiliation
for legitimate purposes and with the
assurance that no reprisals would be taken
Employer-Employee Relationship against the unionists.
Required Exception: when interrogation interferes
General Rule - An unfair labor practice may with or restrains employees' right to self-
be committed only within the context of an organization. [Phil. Steam Navigation Co. v.
employer-employee relationship [American Phil. Marine Officer’s Guild, 1965]
President Lines v. Clave, 1982] Speech
Exception The acts of a company which subjects a union
“Yellow Dog” condition: to require as a to vilification and its participation in soliciting
condition of employment that a person or an membership for a competing union are also
employee shall not join a labor organization acts constituting a ULP. [Phil. Steam
or shall withdraw from one to which he Navigation Co. v. Phil. Marine Officer’s Guild,
belongs. [Art 259 (b)] 1965]
An employer may not send letters containing
promises or benefits, nor of threats of
Parties Not Estopped from Raising obtaining replacements to individual workers
ULP by Eventual Signing of the CBA while the employees are on strike due to a
The eventual signing of the CBA does not bargaining deadlock. This is tantamount to
operate to estop the parties from raising interference and is not protected by the
unfair labor practice charges against each Constitution as free speech. [Insular Life
Assurance Co. Employees Assn. v. Insular Life
Assurance Co. Ltd, 1971]
2) Discrimination: Encourage/
Discourage Unionism [Art. 260 (b)]
General rule: it is a ULP for a labor
organization to cause an employer to
discriminate against an employee.
Exception: provisions of a valid union
security clause and other company policies
applicable to all employees.
As to legality
As coercive m easure by em ployees
(1) Legal strike – one called for a valid
A strike is a coercive measure resorted to by purpose and conducted through means
laborers to enforce their demands. The idea allowed by law.
behind a strike is that a company engaged in
(2) Illegal strike – one staged for a purpose
a profitable business cannot afford to have its
not recognized by law, or if for a valid
production or activities interrupted, much
purpose, conducted through means not
less, paralyzed. [Phil. Can Co. v. CIR, 1950]
sanctioned by law.
Effect of Illegality / Liability of
No severance of employer-employee participating members/officers of the
relationship during lawful strike union
Although during a strike the worker renders 1) Ordinary Striking W orker – cannot
no work or service and receives no be terminated for mere participation in
compensation, […] his relationship as an an illegal strike; proof must be adduced
employee with his employer is not severed or showing that he or she committed illegal
dissolved. [Elizalde Rope Factory, Inc. v. SSS, acts during the strike.
1972]
2) Participating Union Officer – may be
terminated, not only when he actually
commits an illegal act during a strike, but
Payment of wages during lawful
also if he knowingly participates in an
strikes
illegal strike [Phimco Industries, Inc. v
General rule: Striking employees are not PILA, 2010]
entitled to the payment of wages for un-
worked days during the period of the strike
pursuant to the “no work-no pay” principle. As to grounds
1) Economic strike – one staged by
workers to force wage or other economic
Reinstatement after a lawful strike
concessions from the employer which he
When strikers abandon the strike and apply is not required by law to grant
for reinstatement despite the existence of [Consolidated Labor Association of the Phil.
valid grounds but the employer either: v. Marsman and Company, 1964]
(a) refuses to reinstate them or 2) ULP strike – called against a company's
unfair labor practice to force the
(b) imposes upon their reinstatement
employer to desist from committing such
new conditions then the employer
practices.
commits an act of ULP.
The strikers who refuse to accept the new
conditions and are consequently refused As to how com m itted
reinstatement are entitled to the losses of pay
I. Slowdown strike – one by which
they may have suffered by reason of the
workers, without a complete stoppage of
employer’s discriminatory acts from the time
work, retard production or their
they were refused reinstatement. [Philippine
performance of duties and functions to
Marine Officers’ Guild v. Compania Maritima,
compel management to grant their
1968]
demands.
A slowdown is inherently illicit and
unjustifiable because while the
employees continue to work, they, at the labor dispute between the union and the
same time, select what part of their employer. [Rizal Cement Workers Union v. CIR,
duties they perform. In essence, they 1962]
work on their own terms. [Ilaw at Buklod
ng Manggagawa v. NLRC, 1991]
(b) Picketing
II. Wild-cat strike – one declared and
staged without filing the required notice The right of legitimate labor organizations to
of strike and without the majority strike and picket and of employers to lockout,
approval of the recognized bargaining consistent with the national interest, shall
agent. continue to be recognized and respected. [Art.
278 (b)]
III. Sit-down strike – one wherein workers
take over possession of the property of Peaceful Picketing is the right of workers
such business to cease production and to during strikes consisting of marching to and
refuse access to owners. fro before an establishment involved in a
labor dispute generally accompanied by the
IV. Sympathetic strike– one in which the
carrying and display of signs, placards and
striking workers have no demands of their
banners intended to inform the public about
own, but strike to make common cause
the dispute. [Guidelines Governing Labor
with other strikers in other
Relations, October 19, 1987] [NCMB Manual,
establishments.
§1]
V. Mass leave – one in which workers
collectively abandon or boycott regular
work causing temporary stoppage of (c) Lockout
work
Lockout is the temporary refusal of an
employer to furnish work as a result of an
industrial or labor dispute. [Art. 219 (p)]
Conversion from economic to ULP
strike
It is possible for a strike to change its Illegal strike and illegal lockout/In
character from an economic to a ULP strike. Pari Delicto Doctrine
In the instant case, initially, the strike staged
When the employer engaged in illegal
by the Union was meant to compel the
lockout and the employee engaged in illegal
Company to grant it certain economic
strike, both parties are in pari delicto and
benefits set forth in its proposal for collective
such situation warrants the restoration of the
bargaining. However, the strike changed its
status quo ante and bringing the parties back
character from the time the Company refused
to the respective positions before the illegal
to reinstate complainants because of their
strike and illegal lockout. [Philippines Inter-
union activities after it had offered to admit
Fashion Inc. v NLRC, 1982]
all the strikers and in fact did readmit the
others. It was then converted into an unfair
labor practice strike. [Consolidated Labor C.2 WHO MAY DECLARE A STRIKE OR
Assoc. of the Phil. v. Marsman and Company, LOCKOUT?
1964]
W ho may declare a strike
1. The certified or duly recognized
Strike cannot be converted to a bargaining representative
lockout by a return to work offer
2. Any legitimate labor organization in
A strike cannot be converted into a pure and the absence of #1, but only on
simple lockout by the mere expedient filing grounds of ULP [Book V, Rule XXII,
before the trial court a notice of offer to §6]
return to work during the pendency of the
1
7-day “Waiting Period”.
Constitution. [De Leon v. National Labor and assuming jurisdiction over any such
Union, 1957] labor dispute in order to settle or terminate
the same.[Art. 278 (g)]
(3) Noncompliance with procedural A strike which does not strictly comply with
requirements the procedural requirements set by law and
the rules is an unlawful/illegal strike. [Santa
(4) Unlawful means and methods
Rosa Coca-Cola Plant Employees v Coca-Cola
(5) Violation of injunction order Bottlers, 2007]
(6) No strike/lockout provisions in the Good faith strike must still comply
CBA with procedural requirements
Even if the union acted in good faith in the
belief that the company was committing an
(1) Prohibited by law
unfair labor practice, if no notice of strike and
Government employees a strike vote were conducted, the said strike is
While the Constitution guarantees the right illegal. [Grand Boulevard Hotel v.
of government employees to organize, they GLOWHRAIN, 2003]
are otherwise not allowed to strike. GR: A strike based on a non-strikeable
ground is an illegal strike; a strike grounded
on ULP is illegal if no such acts actually exist.
(2) Improper grounds
Exception: Even if no ULP acts are
A legal strike must be based on a bargaining committed by the employer, if the employees
deadlock and/or a ULP act only. believe in good faith that ULP acts exist so as
Intra-union and inter-union disputes are not to constitute a valid ground to strike, then the
proper grounds to strike. strike held pursuant to such belief may be
legal. [NUWHRAI v NLRC, 1998]
Good faith strike
Good faith may be used as a defense if the
strike is held on the basis of an act of ULP by (4) Unlawful means and methods
the employer even if it turned out that there Purpose and means test
was no act of ULP. However, the mandatory
procedural requirements cannot be There must be concurrence between the
dispensed with (notice of strike, cooling-off validity of the purpose of the strike and the
period, strike vote, strike vote report). [Grand means of conducting it.
Boulevard Hotel v. GLOWHRAIN, 2003] A strike is a legitimate weapon in the
Good faith strike requires rational universal struggle for existence. It is
basis considered as the most effective weapon in
protecting the rights of the employees to
A mere claim of good faith would not justify improve the terms and conditions of their
the holding of a strike under the aforesaid employment. But to be valid, a strike
exception as, in addition thereto, the must be pursued within legal bounds.
circumstances must have warranted such The right to strike as a means for the
belief. It is, therefore, not enough that the attainment of social justice is never meant to
union believed that the employer committed oppress or destroy the employer. The law
acts of ULP when the circumstances clearly provides limits for its exercise. Among such
negate even a prima facie showing to sustain limits are the prohibited activities under Art.
such belief. [Interwood Employees Assoc. v. 264, particularly paragraph (e), which states
Int’l Hardwood, 1956] that no person engaged in picketing shall:
• commit any act of violence, coercion,
(3) Noncompliance with procedural or intimidation or
requirements • obstruct the free ingress to or egress
See notes under procedural requirements of a from the employer's premises for
valid strike. lawful purposes or
Any union officer who knowingly participates W hen defense of illegality of strike is
in an illegal strike and any worker or union not deemed waived
officer who knowingly participates in the
The ruling cited in the Bisaya case that the
commission of illegal acts during a strike may
employer waives his defense of illegality of
be declared to have lost his employment
the strike upon reinstatement of strikers is
status. [Article 279(a)]
applicable only to strikers who signified their
Note: Mere participation in an illegal strike intention to return to work and were accepted
by a union officer is sufficient ground to back. […]
terminate his employment. In case of a lawful
Truly, it is more logical and reasonable for
strike, the union officer must commit illegal
condonation to apply only to strikers who
acts during a strike for him to be terminated.
signified their intention to return and did
[Article 279(a)]
return to work. The reason is obvious. These
strikers took the initiative in normalizing
relations with their employer and thus helped
II. LIABILITY OF ORDINARY WORKERS
promote industrial peace. However, as
General rule: Participation by a worker in a regards the strikers who decided to
lawful strike is not ground for termination of pursue with the case, […] the employer
his employment. [Article 279(a)] could not be deemed to have
condoned their strike, because they had
Exception: When the worker participated in
not shown any willingness to normalize
illegal acts during the strike.
relations with it. [Philippine Inter-Fashion, Inc.
When the strike is or becomes illegal, the v. NLRC, 1982]
workers who participate in it are not deemed
However, the mere act of entering into a
to have lost their employment status by
compromise agreement cannot be deemed to
express omission in the second sentence of
be a waiver of the illegality of the strike,
the third paragraph of Art. 279. Only the
unless it such a waiver is clearly shown in the
union officers are deemed to have lost their
agreement. The court has emphasized that
employment status.
“[for] a waiver to be valid and effective [it]
must be couched in clear and unequivocal
III. LIABILITY OF EMPLOYER terms which leave no doubt as to the
intention of a party to give up a right or
Any worker whose employment has been benefit which legally pertains to him.” [Filcon
terminated as a consequence of any unlawful Manufacturing Corp v. Lakas Manggagawa sa
lockout shall be entitled to reinstatement Filcon – Lakas Manggagawa Labor Center]
with full backwages. [Article 279(a)]
C.10 INJUNCTIONS
IV. WAIVER OF ILLEGALITY OF STRIKE
No temporary or permanent injunction or
W hen defense of illegality of strike is restraining order in any case involving or
deemed waived growing out of labor disputes shall be issued
An employer can be deemed to have waived by any court or other entity, except as
the defense that a strike is illegal. In one case, otherwise provided in Articles 225 and 279 of
the Court held that: this Code. [Art. 266]
I. REQUISITES FOR LABOR INJUNCTIONS shall not constitute sufficient ground for
termination of his employment, even if a
Requisites for injunction to issue (in
replacement had been hired by the
accordance with the Powers of the
employer during such lawful strike.
NLRC)
1. actual or threatened commission of a
prohibited or unlawful act OR (b) No person shall obstruct, impede, or
requirement of performance of a interfere with, by force, violence, coercion,
particular act in a labor dispute threats or intimidation, any peaceful
picketing by employees during any labor
2. if unrestrained or unperformed, the
controversy or in the exercise of the right
act will cause substantial and
to self-organization or collective
irreparable damage to any party OR
bargaining, or shall aid or abet such
render ineffectual any decision in
obstruction or interference.
favor of such party
(c) No employer shall use or employ any
3. complainant has no adequate remedy
strike-breaker, nor shall any person be
at law
employed as a strike-breaker.
4. public officers charged with the duty
(d) No public official or employee, including
to protect complainant’s property are
officers and personnel of the New Armed
unable or unwilling to furnish
Forces of the Philippines or the
adequate protection [Art. 225 (e)]
Integrated National Police, or armed
Prohibited Activities person, shall bring in, introduce or escort
in any manner, any individual who seeks
[Art. 279]
to replace strikers in entering or leaving
(a) No labor organization or employer shall the premises of a strike area, or work in
declare a strike or lockout without first place of the strikers. The police force
having bargained collectively in shall keep out of the picket lines unless
accordance with Title VII of this Book or actual violence or other criminal acts
without first having filed the notice occur therein: Provided, That nothing
required in the preceding Article or herein shall be interpreted to prevent any
without the necessary strike or lockout public officer from taking any measure
vote first having been obtained and necessary to maintain peace and order,
reported to the Ministry. protect life and property, and/or enforce
No strike or lockout shall be declared the law and legal order.
after assumption of jurisdiction by the (e) No person engaged in picketing shall
President or the Minister or after commit any act of violence, coercion or
certification or submission of the dispute intimidation or obstruct the free ingress
to compulsory or voluntary arbitration or to or egress from the employer’s premises
during the pendency of cases involving for lawful purposes, or obstruct public
the same grounds for the strike or lockout. thoroughfares.
Any worker whose employment has been
terminated as a consequence of any
II. “INNOCENT BYSTANDER RULE”
unlawful lockout shall be entitled to
reinstatement with full backwages. Any Test to Determine if a Party is an
union officer who knowingly participates “Innocent Bystander”
in an illegal strike and any worker or
An "innocent bystander," who seeks to enjoin
union officer who knowingly participates
a labor strike, must satisfy the court that
in the commission of illegal acts during a
aside from the grounds specified in Rule 58
strike may be declared to have lost his
of the Rules of Court, it is entirely
employment status: Provided, That mere
different from, without any
participation of a worker in a lawful strike
connection whatsoever to, either
(10) Other cases as may be provided by law. (3) The claim exceeds P5,000, whether
or not there is a claim for
reinstatement.
Requisites of LA’s jurisdiction over
Money Claim s
The Regional Director has jurisdiction
(1) Money claims arose from ER-EE relations,
if:
and
(1) the money claim is not accompanied
(2) Money claims arose from law or contracts
by reinstatement AND
other than a CBA
(2) the claim does not exceed P5,000
• Employer-employee relationship is a [Art. 129]
jurisdictional requisite, absent of
which, the NLRC has no jurisdiction
to hear and decide the case. A.2 PROCEDURE
[Hawaiian-Philippine Company v.
Gulmatico] W here to File
Complaint should be filed with the Regional
Arbitration Branch (RAB) having jurisdiction
If m oney claim s do not arise from ER- over the workplace of the complainant or
EE relations petitioner.
Regular courts has jurisdiction
• Workplace - place or locality where
the employee is regularly assigned at
the time the cause of action arose.
If m oney claim s arise from ER-EE
relations but by virtue of • In the case of field employees,
implementation of CBA ambulant or itinerant workers, their
Voluntary Arbitrator has jurisdiction workplace is (a) where they are
regularly assigned or (b) where they
are supposed to regularly receive
“Exclusive and Original” Jurisdiction their salaries and wages or work
subject to Articles 274 and 275 instructions from, and report the
results of their assignment to their
A case under Art 224 may be lodged instead employers.
with a voluntary arbitrator. The policy of the
law is to give primacy to voluntary modes of
settling dispute. Some Rules on Venue
1. Exclusion. Where 2 or more Regional
I. VERSUS REGIONAL DIRECTOR Arbitration Branches have jurisdiction
over the workplace of the complainant,
Jurisdiction on Money Claims (Labor that first which acquired jurisdiction over
Arbiter vs. Regional Director) the case shall exclude others.
(1) A money claim arising from 2. W aiver. When venue is not objected to
employer-employee relations, except before the filing of position papers, such
SSS, ECC/Medicare claims, is within issue shall be deemed waived.
the jurisdiction of a labor arbiter if:
3. Transfer. Venue of an action may be
(2) The claim, regardless of amount, is transferred to a different Regional
accompanied with a claim of Arbitration Branch upon written
reinstatement; or agreement of the parties or upon order of
the LA in meritorious cases and on
motion of the proper party.
allegations in the pleading are true and shopping; and (d) proof of service
correct and have been filed in good faith. upon the other parties.
[Antonio B. Salenga, et al. v. CA, 2012]
(2) A mere notice of appeal without
complying with the other requisites
aforestated shall not stop the running of
B.2 EFFECT OF NLRC REVERSAL OF
the period for perfecting an appeal.
LABOR ARBITER’S ORDER OF
REINSTATEMENT (3) The appellee may file with the Regional
Arbitration Branch or Regional Office
Even if the order of reinstatement of the
where the appeal was filed, his answer or
Labor Arbiter is reversed on appeal, it is
reply to appellant’s memorandum of
obligatory on the part of the employer to
appeal, not later than 10 calendar days
reinstate and pay the wages of the dismissed
from receipt thereof. Failure on the part
employee during the period of appeal until
of the appellee who was properly
reversal by the higher court.
furnished with a copy of the appeal to file
On the other hand, if the employee has been his answer or reply within the said period
reinstated during the appeal period and such may be construed as a waiver on his part
reinstatement order is reversed with finality, to file the same.
the employee is not required to reimburse
(4) Subject to the provisions of Article 218 of
whatever salary he received for he is entitled
the Labor Code, once the appeal is
to such, more so if he actually rendered
perfected in accordance with these Rules,
services during the period. [Garcia v.
the Commission shall limit itself to
Philippine Airlines, Inc., G.R. No.164856,
reviewing and deciding only the specific
2009]
issues that were elevated on appeal.
B.3 REMEDIES
Requisites for Perfection of Appeal to
B.4 CERTIFIED CASES
the Court of Appeals
Definition
[Rule 43]
Certified labor disputes are cases certified to
(1) The appeal shall be:
the Commission for compulsory arbitration
• Filed within the reglementary period; under Art. 278 (g) of the Labor Code. [§2, The
2011 NLRC Rules and Procedures]
• Verified by the appellant himself in
accordance with §4, Rule 7 of the When, in his opinion, there exists a labor
Rules of Court; dispute causing or likely to cause a strike or
lockout in an industry indispensable to the
• In the form of a memorandum of national interest, the Secretary of Labor and
appeal which shall state the grounds Employment may assume jurisdiction over
relied upon and the arguments in the dispute and decide it or certify the same
support thereof, the relief prayed for, to the Commission for compulsory
and with a statement of the date the arbitration. Such assumption or certification
appellant received the appealed shall have the effect of automatically
decision, resolution or order; enjoining the intended or impending strike or
• In three (3) legibly typewritten or lockout as specified in the assumption or
printed copies; and certification order. [Art. 278]
NLRC is not sitting as a judicial court but as relative or incident to the certified case
an administrative body charged with the duty before it.
to implement the order of the Secretary. Its
5. When a certified labor dispute involves a
function only is to formulate the terms and
business entity with several workplaces
conditions of the CBA and cannot go beyond
located in different regions, the Division
the scope of the order. Moreover, the
having territorial jurisdiction over the
Commission is further tasked to act within the
principal office of the company shall
earliest time possible and with the end in
acquire jurisdiction to decide such labor
view that its action would not only serve the
dispute; unless the certification order
interests of the parties alone, but would also
provides otherwise. [Section 3, 2011 NLRC
have favorable implications to the community
Rules and Procedures]
and to the economy as a whole. This is the
clear intention of the legislative body in
enacting Art. 278 paragraph (g) of the Labor
Effects of Defiance
Code, as amended by Section 27 of R.A. 6175
[Union of Filipino Employees v. NLRC, 1990] Non-compliance with the certification order
of the SOLE shall be considered as an illegal
act committed in the course of the strike or
Effects of Certification lockout and shall authorize the Commission
to enforce the same under pain of immediate
1. Upon certification, the intended or
disciplinary action, including dismissal or loss
impending strike or lockout is
of employment status or payment by the
automatically enjoined, notwithstanding
locking-out employer of backwages,
the filing of any motion for
damages and/or other affirmative relief, even
reconsideration of the certification order
criminal prosecution against the liable
nor the non-resolution of any such
parties.
motion which may have been duly
submitted to the Office of the Secretary of The Commission may also seek the
Labor and Employment. assistance of law enforcement agencies to
ensure compliance and enforcement of its
2. If a work stoppage has already taken
orders and resolutions. [Sec. 4, 2011 NLRC
place at the time of the certification, all
Rules and Procedures]
striking or locked out employees shall
immediately return to work and the
employer shall immediately resume
Strict Compliance of Assumption and
operations and readmit all workers under
Certification Orders
the same terms and conditions prevailing
before the strike or lockout. The Secretary's assumption and certification
orders being executory in character are to be
3. All cases between the same parties,
strictly complied with by the parties even
except where the certification order
during the pendency of a petition questioning
specifies otherwise the issues submitted
their validity for this extraordinary authority
for arbitration which are already filed or
given by law to the Secretary of Labor is
may be filed, and are relevant to or are
"aimed at arriving at a peaceful and speedy
proper incidents of the certified case,
solution to labor disputes, without
shall be considered subsumed or
jeopardizing national interests." [Union of
absorbed by the certified case, and shall
Filipro Employees v. NLRC, 1990]
be decided by the appropriate Division of
the Commission.
4. The parties to a certified case, under pain Procedure in certified cases
of contempt, shall inform their counsels (a) When there is no need to conduct a
and the Division concerned of all cases clarificatory hearing, the Commission
pending with the Regional Arbitration shall resolve all certified cases within 30
Branches and the Voluntary Arbitrators calendar days from receipt by the
assigned Commissioner of the complete The Bureau shall have fifteen (15) calendar
records, which shall include the position days to act on labor cases before it, subject
papers of the parties and the order of the to extension by agreement of the parties.
SOLE denying the motion for [Art. 232]
reconsideration of the certification order,
if any.
(b) Where a clarificatory hearing is needed, Original Jurisdiction
the Commission shall, within 5 calendar Decisions of the BLR through its original
days from receipt of the records, issue a jurisdiction are appealable to the Secretary of
notice to be served on the parties through Labor and Employment.
the fastest means available, requiring
them to appear and submit additional
evidence, if any. All certified cases shall Appellate Jurisdiction
be resolved by the Commission within 60
BLR has the power to review the decisions of
calendar days from receipt of the
the Regional Director
complete records by the assigned
Commissioner. Decisions rendered through its appellate
power are final and executory. Hence, the
(c) No motion for extension or postponement
remedy of the aggrieved party is to
shall be entertained. [Sec. 5, 2011 NLRC
seasonably avail of the special civil action of
Rules and Procedures]
certiorari under Rule 65 of the Rules of Court.
Execution of Judgment
D. NATIONAL CONCILIATION AND
Upon issuance of the entry of judgment, the MEDIATION BOARD
Commission motu propio or upon motion by
the proper party, may cause the execution of
the judgment in the certified case. [Sec. 6, D.1 NATURE OF PROCEEDINGS
2011 NLRC Rules and Procedures]
Conciliation and mediation is non-
litigious/non-adversarial, less expensive, and
C. BUREAU OF LABOR RELATIONS – expeditious. Under this informal set-up, the
parties find it more expedient to fully
MED-ARBITERS
ventilate their respective positions without
running around with legal technicalities and,
in the course thereof, afford them wider
C.1 JURISDICTION (ORIGINAL AND
latitude of possible approaches to the
APPELLATE)
problem.
The Bureau of Labor Relations and the Labor
Relations Divisions in the regional offices of
the Department of Labor and Employment D.2 CONCILIATION VS. MEDIATION
shall have original and exclusive authority to
Conciliation
act, at their own initiative or upon request of
either or both parties, on all inter-union and A mild form of intervention by a neutral third
intra-union conflicts, and all disputes, party, the Conciliator-Mediator, relying on his
grievances or problems arising from or persuasive expertise, takes an active role in
affecting labor-management relations in all assisting parties by trying to keep disputants
workplaces whether agricultural or non- talking, facilitating other procedural niceties,
agricultural, except those arising from the carrying messages back and forth between
implementation or interpretation of the parties, and generally being a good fellow
collective bargaining agreements which shall who tries to keep things calm and forward-
be the subject of grievance procedure and/or looking in a tense situation.
voluntary arbitration.
E.1 JURISDICTION
NOTE: See RA 10361 (Kasambahay Law) on
Small money claims settlement of disputes.
Recovery of wages, sim ple m oney
claims and other benefits. —Upon
Mechanism for Settlement of Disputes. – All
complaint of any interested party, the
labor-related disputes shall be elevated to
Regional Director of the Department of
the DOLE Regional Office having jurisdiction
Labor and Employment or any of the duly
over the workplace without prejudice to the
authorized hearing officers of the
filing of a civil or criminal action in
Department is empowered, through
appropriate cases. The DOLE Regional Office
summary proceeding and after due notice, to
shall exhaust all conciliation and mediation
hear and decide any matter involving the
efforts before a decision shall be rendered.
recovery of wages and other monetary claims
and benefits, including legal interest, owing Ordinary crimes or offenses committed under
to an employee or person employed in the Revised Penal Code and other special
domestic or household service or penal laws by either party shall be filed with
househelper under this Code, arising from the regular courts. [Sec. 37, RA 10361]
employer-employee relations: Provided, That
such complaint does not include a claim for
BLR may be appealed to the SOLE (if The VA or panel of VAs shall have original
originally rendered by the Regional Office, and exclusive jurisdiction to hear and decide
appeal should be made to the BLR) all unresolved grievances.
Decisions of the Med-Arbiter in certification Violations of a CBA, except those which are
election cases are appealable to the SOLE gross in character, shall no longer be treated
(decisions of med-arbiters in intra-union as ULP and shall be resolved as grievances
disputes are appealable to the BLR) [Art. 272] under the CBA.
Note: Gross violations of CBA shall mean
flagrant and/or malicious refusal to comply
F.5 VOLUNTARY ARBITRATION POWERS
with the economic provisions of such
Before or at any stage of the compulsory agreement. [Art. 274]
arbitration process, the parties may opt to
The Commission, its Regional Offices and the
submit their dispute to voluntary arbitration.
Regional Directors of the DOLE shall not
[Art. 278 (h)]
entertain disputes, grievances or matters
under the exclusive and original jurisdiction
of the Voluntary Arbitrator or panel of
The Secretary of Labor and Employment […]
Voluntary Arbitrators and shall immediately
shall decide or resolve the dispute […]. [Art.
dispose and refer the same to the grievance
278 (i)]
machinery or Voluntary Arbitration provided
in the Collective Bargaining Agreement. [Art.
274]
G. GRIEVANCE MACHINERY AND
VOLUNTARY ARBITRATION
Other Labor Disputes
G.1 SUBJECT MATTER OF GRIEVANCE The VA or panel of VAs, upon agreement of
the parties, shall also hear and decide all
Grievance is any question by either the ER other labor disputes including ULP and
or the union regarding the interpretation or bargaining deadlocks. [Art. 275]
application of the CBA or company personnel
policies or any claim by either party that the
other party is violating any provisions of the Even if the specific issue brought before the
CBA or company personnel policies. arbitrators merely mentioned the question of
It is a complaint or dissatisfaction arising “whether an employee was discharged for
from the interpretation or implementation of just cause,” they could reasonably assume
the CBA and those arising from interpretation that their powers extended beyond the
or enforcement of personnel policies. determination thereof to include the power to
reinstate the employee or to grant back
Grievance Machinery wages. In the same vein, if the specific issue
It refers to the mechanism for the adjustment brought before the arbitrators referred to the
and resolution of grievances. It is part of the date of regularization of the employee, law
continuing process of collective bargaining. and jurisprudence gave them enough leeway
as well as adequate prerogative to determine
the entitlement of the employees to higher
G.2 VOLUNTARY ARBITRATOR benefits in accordance with the finding of
regularization. [Manila Pavilion Hotel, etc. vs.
I. JURISDICTION
Henry Delada, 2011]
Exclusive and Original Jurisdiction
Over Grievances
Filing of application
W orker’s association
National Union or
Independent Union Chartered Local W orker’s Association operating in m ore
Federation
than one region
Requirements (1) Name of labor union 1) Name of federation (1) Charter certificate 1) Name of association Same as worker’s
for and its principal and its principal issued by national and its principal association
application address addresses union or federation address
+
Name of its officers 2) Name of its officers Name of officers and
7) Resolution of
and their respective and their respective their respective
Other requirements (to membership of each
addresses addresses addresses
be entitled to all other member association,
(2) Approximate 3) Minutes of rights and privileges of 2) Minutes of duly approved by its
number of organizational LLO) organizational board of directors
employees in the meetings and list of meetings and list of
(a) Names of
bargaining unit participating participating
local/chapter’s
where it seeks to employees members
officers and their
operate
4) Annual financial addresses 3) Annual financial
(3) Statement that it is reports (if it has been reports (if it has been
(b) Principal office of
not a chartered local in existence for more in existence for more
local/chapter
of any federation or than one year) or than one year) or
nat’l union statement that no (c) Chapter’s CBL, or statement that no
collection has been statement that collection has been
(4) Minutes of
made chapter has adopted made
organizational
the CBL of federation
meetings and list of 5) CBL, minutes of its 4) CBL, minutes its of
or national union
participating adoption and adoption and
employees ratification, and list (d) Certification under ratification, list of
of participating oath by secretary participating
(5) Name of all its
employees (list may and attestation by members, and date
members comprising
be dispensed with if President of ratification (unless
at least 20% of
ratification was done ratification was done
employees in BU
during during
(6) Annual financial organizational organizational
UP LAW BOC LABOR RELATIONS LABOR LAW
SUMMARY OF UNION REGISTRATION