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General Concepts employee is validly dismissed for causes other than serious the social justice exception could be made to apply
misconduct or those reflecting on his moral character. Where depending on certain considerations, such as the
A. Labor the reason for the valid dismissal is, for example, habitual length of service of the employee, the amount
intoxication or an offense involving moral turpitude, like theft involved, whether the act is the first offense, the
or illicit sexual relations with a fellow worker, the employer performance of the employee, and the like
B. Labor law may not be required to give the dismissed employee
separation pay, or financial assistance, or whatever other
To reiterate our ruling in Toyota, labor adjudicatory
C. Labor Standards v. Labor relations name it is called, on the ground of social justice.
officials and the CA must demur the award of
separation pay based on social justice when an
E. Social Justice Applying the above considerations, we hold that the grant of employee's dismissal is based on serious
separation pay in the case at bar is unjustified. The private misconduct or willful disobedience; gross and
respondent has been dismissed for dishonesty, as found by habitual neglect of duty; fraud or willful breach of
1. Definition the labor arbiter and affirmed by the NLRC and as she trust; or commission of a crime against the person
herself has impliedly admitted. The fact that she has worked of the employer or his immediate family - grounds
with the PLDT for more than a decade, if it is to be under Article 282 of the Labor Code that sanction
considered at all, should be taken against her as it reflects a dismissals of employees. They must be most
Calalang v Williams regrettable lack of loyalty that she should have strengthened judicious and circumspect in awarding separation
instead of betraying during all of her 10 years of service with pay or financial assistance as the constitutional
the company. If regarded as a justification for moderating the policy to provide full protection to labor is not
penalty of dismissal, it will actually become a prize for meant to be an instrument to oppress the
Social justice is “neither communism, nor despotism, nor disloyalty, perverting the meaning of social justice and employers. The commitment of the Court to the
atomism, nor anarchy,” but the humanization of laws and the undermining the efforts of labor to cleanse its ranks of all cause of labor should not embarrass us from
undesirables. sustaining the employers when they are right, as
equalization of social and economic forces by the State so
here. In fine, we should be more cautious in
that justice in its rational and objectively secular conception
awarding financial assistance to the undeserving
may at least be approximated. Social justice means the and those who are unworthy of the liberality of the
promotion of the welfare of all the people, the adoption by Security bank savings corp v law
the Government of measures calculated to insure economic Singson (214230)
stability of all the competent elements of society, through the
maintenance of a proper economic and social equilibrium in To reiterate, the grant of separation pay to a
dismissed employee is primarily determined by the
the interrelations of the members of the community,
cause of the dismissal.
constitutionally, through the adoption of measures legally Thus, in the PLDT case, the Court required that
justifiable, or extraconstitutionally, through the exercise of the grant of separation pay as financial assistance
powers underlying the existence of all governments on the given in light of social justice be allowed only when In the case at bar, respondent's established act of
time-honored principle of salus populi est suprema lex. the dismissal: repeatedly allowing Branch Manager Pinero to
chanroblespublishingcompany bring the checkbooks and bank forms outside of
the bank's premises in violation of the company's
(a) was not for serious misconduct; and rules and regulations had already been declared
Social justice, therefore, must be founded on the recognition
of the necessity of interdependence among divers and by the LA to be gross and habitual neglect of duty
(b) does not reflect on the moral character of the under Article 282 of the Labor Code, which finding
diverse units of a society and of the protection that should
employee or would involve moral turpitude. was not contested on appeal by respondent. It was
be equally and evenly extended to all groups as a combined petitioners who interposed an appeal solely with
force in our social and economic life, consistent with the respect to the award of separation pay as financial
fundamental and paramount objective of the state of However, in the later case of Toyota Motor assistance. As they aptly pointed out, the
promoting the health, comfort, and quiet of all persons, and Philippines Corporation Workers Association v. infractions, while not clearly indicative of any
of bringing about “the greatest good to the greatest number.” NLRC (Toyota),33 the Court further excluded from wrongful intent, is, nonetheless, serious in nature
the grant of separation pay based on social justice when one considers the employee's functions,
2. Application the other instances listed under Article 282 (now rendering it inequitable to award separation pay
296) of the Labor Code, namely, willful based on social justice. As the records show,
disobedience, gross and habitual neglect of respondent was the custodian of accountable bank
duty, fraud or willful breach of trust, and forms in his assigned branch and as such, was
PLDT v NLRC L-90609 commission of a crime against the employer or mandated to strictly comply with the monitoring
his family. procedure and disposition thereof as a security
measure to avoid the attendant high risk to the
But with respect to analogous cases for bank. Indeed, it is true that the failure to observe
We hold that henceforth separation pay shall be allowed as a termination like inefficiency, drug use, and others, the processes and risk preventive measures and
measure of social justice only in those instances where the worse, to take action and address its violation,
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may subject the bank to regulatory sanction. It Separation pay or financial assistance may also be granted Section 18. The State affirms labor as a primary
bears stressing that the banking industry is imbued to a legally terminated employee as an act of social justice social economic force. It shall protect the rights of
with public interest. Banks are required to possess and equity when the circumstances so warrant. 85 In workers and promote their welfare.
not only ordinary diligence in the conduct of its awarding financial assistance, the interests of both the
business but extraordinary diligence in the care of employer and the employee must be tempered, if only to
Section 20. The State recognizes the
its accounts and the interests of its stakeholders. approximate what Justice Laurel calls justice in its secular
indispensable role of the private sector,
The banking business is highly sensitive with a sense.86 As the term suggests, its objective is to enable an
encourages private enterprise, and provides
fiduciary duty towards its client and the public in employee to get by after he has been stripped of his source
incentives to needed investments.
general, such that central measures must be of income from which he relies mainly, if not, solely.87
strictly observed. 37 It is undisputed that
respondent failed to perform his duties diligently,
We agree with the CA that the reinstatement of
and therefore, not only violated established
Buenviaje is no longer viable given the Article III
company policy but also put the bank's credibility
irreconcilable differences and strained relations
and business at risk. The excuse that his Branch
between her and PNOC-EDC. In light of this,
Manager, Pinero, merely prompted him towards
separation pay with full backwages, in lieu of
such ineptitude is of no moment. He readily
Buenviaje's reinstatement, is warranted. Section 1. No person shall be deprived of life,
admitted that he violated established company
policy against bringing out checkbooks and bank liberty, or property without due process of law, nor
forms, 38 which means that he was well aware of F. Sources shall any person be denied the equal protection of
the fact that the same was prohibited. the laws.
1. 1987 Constitution
Nevertheless, he still chose to, regardless of his
superior's influence, disobey the same not only Section 4. No law shall be passed abridging the
once, but on numerous occasions. All throughout, freedom of speech, of expression, or of the press,
there is no showing that he questioned the acts of or the right of the people peaceably to assemble
Article II
Branch Manager Pinero; neither did he take it and petition the government for redress of
upon himself to report said irregularities to a higher grievances.
authority. Hence, under these circumstances, the
award of separation pay based on social justice
would be improper. Section 5. The maintenance of peace and order, Section 8. The right of the people, including those
the protection of life, liberty, and property, and employed in the public and private sectors, to form
promotion of the general welfare are essential for unions, associations, or societies for purposes not
the enjoyment by all the people of the blessings of contrary to law shall not be abridged.
Philippine Airlines v NLRC (123294) democracy.
Section 16. All persons shall have the right to a
Section 9. The State shall promote a just and speedy disposition of their cases before all judicial,
dynamic social order that will ensure the prosperity quasi-judicial, or administrative bodies.
and independence of the nation and free the
In the case at bar, the transgressions imputed to private people from poverty through policies that provide
respondent have never been firmly established as deliberate adequate social services, promote full Section 18.
and willful acts clearly directed at making petitioner lose employment, a rising standard of living, and an
millions of pesos. At the very most, they can only be improved quality of life for all. 1. No person shall be detained solely by
characterized as unintentional, albeit major, lapses in reason of his political beliefs and
professional judgment. Likewise, the same cannot be aspirations.
Section 10. The State shall promote social justice
described as morally reprehensible actions. Thus, private 2. No involuntary servitude in any form
in all phases of national development.
respondent may be granted separation pay on the ground of shall exist except as a punishment for a
equity which this Court had defined as justice outside law, crime whereof the party shall have been
being ethical rather than jural and belonging to the sphere of Section 13. The State recognizes the vital role of duly convicted.
morals than of law. It is grounded on the precepts of the youth in nation-building and shall promote and
conscience and not on any sanction of positive law, for protect their physical, moral, spiritual, intellectual,
equity finds no room for application where there is law and social well-being. It shall inculcate in the youth
patriotism and nationalism, and encourage their Article XIII.
involvement in public and civic affairs.

POC v Buenviaje (June 19, 2016) Section 14. The State recognizes the role of
women in nation-building, and shall ensure the Section 1. The Congress shall give highest priority
fundamental equality before the law of women and to the enactment of measures that protect and
men. enhance the right of all the people to human
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dignity, reduce social, economic, and political Section 14. The State shall protect working In sum, the benefit must be characterized by
inequalities, and remove cultural inequities by women by providing safe and healthful working
equitably diffusing wealth and political power for conditions, taking into account their maternal
1. regularity,
the common good. functions, and such facilities and opportunities that
2. voluntary and
will enhance their welfare and enable them to
3. deliberate intent of the employer
realize their full potential in the service of the
To this end, the State shall regulate the
nation.
acquisition, ownership, use, and disposition of
to grant the benefit over a considerable period of time.
property and its increments.

Section 2. The promotion of social justice shall 2. Civil Code


include the commitment to create economic Central Asucarera de Tarlac v
opportunities based on freedom of initiative and Central Asucarera de Tarlac Union-
self-reliance. Article 1700. The relations between capital and NLU (188949)
labor are not merely contractual. They are so
impressed with public interest that labor contracts
LABOR
must yield to the common good. Therefore, such
contracts are subject to the special laws on labor The argument of petitioner that the grant of the benefit (13th
Section 3. The State shall afford full protection to unions, collective bargaining, strikes and lockouts, month) was not voluntary and was due to error in the
labor, local and overseas, organized and closed shop, wages, working conditions, hours of interpretation of what is included in the basic salary deserves
unorganized, and promote full employment and labor and similar subjects. scant consideration. No doubtful or difficult question of law is
equality of employment opportunities for all. involved in this case. The guidelines set by the law are not
Article 1702. In case of doubt, all labor legislation difficult to decipher. The voluntariness of the grant of the
It shall guarantee the rights of all workers to self- and all labor contracts shall be construed in favor benefit was manifested by the number of years the employer
organization, collective bargaining and of the safety and decent living for the laborer. had paid the benefit to its employees. Petitioner only
negotiations, and peaceful concerted activities, changed the formula in the computation of the 13th-month
including the right to strike in accordance with law. pay after almost 30 years and only after the dispute between
They shall be entitled to security of tenure, the management and employees erupted. This act of
humane conditions of work, and a living wage. petitioner in changing the formula at this time cannot be
3. Company pracice sanctioned, as it indicates a badge of bad faith.
They shall also participate in policy and decision-
making processes affecting their rights and
benefits as may be provided by law.
Vergara v Coca-cola botlers
The State shall promote the principle of shared (176985) 4. Contracts
responsibility between workers and employers and
the preferential use of voluntary modes in settling
disputes, including conciliation, and shall enforce
their mutual compliance therewith to foster To be considered as a regular company practice, the A. Nate Casket maker v Arango
industrial peace. employee must prove by substantial evidence that the giving (192282)
of the benefit is done
The State shall regulate the relations between
workers and employers, recognizing the right of 1. over a long period of time, and that
labor to its just share in the fruits of production and Contract: You will be working a 5-month contract basis.
2. it has been made consistently and deliberately.19 Your contract will be renewed on a case-to-case basis or
the right of enterprises to reasonable returns to
investments, and to expansion and growth. based upon the efficiency of your performance. The
Jurisprudence has not laid down any hard-and-fast rule as to company also reserves the right to discontinue or terminate
the length of time that company practice should have been your employment anytime if your performance does not
HEALTH exercised in order to constitute voluntary employer come to expectations or if the conditions under which you
practice.20 The common denominator in previously decided have been employed no longer exist.
Section 13. The State shall establish a special cases appears to be the regularity and deliberateness of the
agency for disabled person for their rehabilitation, grant of benefits over a significant period of time.21 It requires Held: It must be emphasized that employers cannot seek
self-development, and self-reliance, and their an indubitable showing that the employer agreed to continue refuge under whatever terms of the agreement they had
integration into the mainstream of society. giving the benefit knowing fully well that the employees are entered into with their employees.
not covered by any provision of the law or agreement
requiring payment thereof.22
WOMEN
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The law, in defining their contractual relationship, does so, entitled to security of tenure who could only be dismissed for tool kits were furnished to the mechanics which they use in
not necessarily or exclusively upon the terms of their written just and authorized causes. repairs and checking of the units conducted inside or in front
or oral contract, but also on the basis of the nature of the of the Norkis Display Center.9
work of employees who had been called upon to perform. Consequently, petitioners were illegally dismissed and are
The law affords protection to an employee, and it will not entitled to the twin remedies of payment of separation pay
countenance any attempt to subvert its spirit and intent. A and full back wages. We order separation pay in lieu of
stipulation in an agreement can be ignored as and when it is reinstatement given the time that has lapsed, twelve years, Royale Homes Marketing Corp v
utilized to deprive the employee of his security of tenure. The in the litigation of this case. Alcantara (195190)
sheer inequality that characterizes employer employee
relations, where the scales generally tip against the
employee, often scarcely provides him real and better
G. Employer-employee relationship Not every form of control is indicative of employer-employee
options.27chanrobleslaw
relationship. A person who performs work for another and is
1. Tests subjected to its rules, regulations, and code of ethics does
a. Four-fold test not necessarily become an employee.34 As long as the level
of control does not interfere with the means and methods of
accomplishing the assigned tasks, the rules imposed by the
hiring party on the hired party do not amount to the labor law
Samonte v LSGH (199683) concept of control that is indicative of employer-employee
Bazar v Ruizol (198782)
relationship. In Insular Life Assurance Co., Ltd. v. National
Labor Relations Commission35 it was pronounced that:

The uniform one-page Contracts of Retainer signed by


The four-fold test used in determining the, existence of Logically, the line should be drawn between rules
petitioners were prepared by LSGI alone. Petitioners,
employer employee relationship are: that merely serve as guidelines towards the
medical professionals as they were, were still not on equal
achievement of the mutually desired result without
footing with LSGI as they obviously did not want to lose their (a) the selection and engagement of the employee; dictating the means or methods to be employed in
jobs that they had stayed in for fifteen (15) years. There is no attaining it, and those that control or fix the
specificity in the contracts regarding terms and conditions of (b) the payment of wages; methodology and bind or restrict the party hired to
employment that would indicate that petitioners and LSGI the use of such means. The first, which aim only to
were on equal footing in negotiating it. Notably, without (c) the power of dismissal; and promote the result, create no employeremployee
specifying what are the tasks assigned to petitioners, LSGI relationship unlike the second, which address both
"may upon prior written notice to the retainer, terminate [the] (d) the employer's power to control the employee with the result and the means used to achieve it. x x x36
contract should the retainer fail in any way to perform his respect to the means and methods by which the work is to
assigned job/task to the satisfaction of La Salle Greenhills, be accomplished.8chanroblesla
In this case, the Court agrees with Royale Homes that the
Inc. or for any other just cause."16 rules, regulations, code of ethics, and periodic evaluation
In finding that respondent was an employee of NDI, the
Court of Appeals applied the four-fold test in this wise: alluded to by Alcantara do not involve control over the
While vague in its sparseness, the Contract of Retainer very means and methods by which he was to performhis job.
clearly spelled out that LSGI had the power of control over
petitioners. x x x First, the services of [respondent] was indisputably Understandably, Royale Homes has to fix the price, impose
engaged by the [NDI] without the aid of a third requirements on prospective buyers, and lay down the terms
Time and again we have held that the power of control refers party. Secondly, the fact that the [respondent] was paid a and conditions of the sale, including the mode of payment,
to the existence of the power and not necessarily to the retainer fee and on a per diem basis does not altogether which the independent contractors must follow.
actual exercise thereof, nor is it essential for the employer to negate the existence of an [employer]-employee relationship.
actually supervise the performance of duties of the The retainer agreement only provided the breakdown, of the
[respondent's] monthly income. On a more important note, the It is also necessary for Royale Homes to allocate its
employee.17 It is enough that the employer has the right to
[NDI] did not present its payroll, which it could conveniently inventories among its independent contractors, determine
wield that power.
do, to disprove the [respondent's] claim that he was their who has priority in selling the same, grant commission or
employee. x x x allowance based on predetermined criteria, and regularly
In all, given the following: (1) repeated renewal of petitioners' monitor the result of their marketing and sales efforts. But
contract for fifteen years, interrupted only by the close of the Third, the [NDI's] power of dismissal can be [gleaned] from the tothe mind of this Court, these do not pertain to the means
school year; (2) the necessity of the work performed by termination of the [respondent] although couched under the and methods of how Alcantara was to perform and
petitioners as school physicians and dentists; and (3) the guise of the non-renewal of his contract with the company. accomplish his task of soliciting sales. They do not dictate
existence of LSGI's power of control over the means and Also, the contract alone showed that the [respondent] upon him the details of how he would solicit sales or the
method pursued by petitioners in the performance of their provided service to Yamaha motorbikes brought to the NDI manner as to how he would transact business with
job, we rule that petitioners attained regular employment, service shop in accordance with the manual of the unit and prospective clients. In Tongko, this Court held that guidelines
subject to the minimum standards set by the company. Also, or rules and regulations that do notpertain to the means or
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methodsto be employed in attaining the result are not (3) the nature and degree of control exercised by employee. This two-tiered test, which involves: "(1) the
indicative of control as understood inlabor law. the employer; putative employer's power to control the employee with
(4) the worker’s opportunity for profit and loss; respect to the means and methods by which the work is to
(5) the amount of initiative, skill, judgment or be accomplished; and (2) the underlying economic realities
Neither does the repeated hiring of Alcantara prove the
foresight required for the success of the claimed of the activity or relationship," has been made especially
existence of employer-employee relationship.41 As discussed
independent enterprise; appropriate in cases where there is no written agreement to
above, the absence of control over the means and
(6) the permanency and duration of the base the relationship on and where the various tasks
methodsdisproves employer-employee relationship. The
relationship between the worker and the employer; performed by the worker brings complexity to the relationship
continuous rehiring of Alcantara simply signifies the renewal
and with the employer.32 Thus, in addition to the control test, the
of his contract with Royale Homes, and highlights his
(7) the degree of dependency of the worker upon totality of the economic circumstances of the worker is taken
satisfactory services warranting the renewal of such contract.
the employer for his continued employment in that into light to determine the existence of employment
Nor does the exclusivity clause of contract establish the
line of business. relationship.
existence of the labor law concept of control. In Consulta v.
Court of Appeals,42 it was held that exclusivity of contract
The proper standard of economic dependence is whether the In the present case, there is a written contract, i.e., the
does not necessarily result in employer-employee
worker is dependent on the alleged employer for his Sales Agency Agreement, which served as the primary
relationship
continued employment in that line of business evidence of the nature of the parties' relationship. In this
duly executed and signed agreement, petitioners and
By applying the control test, it can be said that petitioner is respondent unequivocally agreed that petitioners' services
an employee of Kasei Corporation because she was under were to be engaged on an agency basis as sales account
b. Economic reality/dependence the direct control and supervision of Seiji Kamura, the executives and that no employer-employee relationship is
corporation’s Technical Consultant. She reported for work created but an independent contractorship.
regularly and served in various capacities as Accountant,
Liaison Officer, Technical Consultant, Acting Manager and
Francisco v NLRC (170887) It is therefore clear that the intention at the time of the
Corporate Secretary, with substantially the same job
signing of the agreement is not to be bound by an employer-
functions, that is, rendering accounting and tax services to
employee relationship. At any rate, even if we are to apply
the company and performing functions necessary and
the two-tiered test pronounced in the Francisco case, there
desirable for the proper operation of the corporation such as
There are instances when, aside from the employer’s power can still be no employer-employee relationship since, as
securing business permits and other licenses over an
to control the employee, economic realities of the discussed, the element of control is already absent.
indefinite period of engagement. Respondent corporation
employment relations help provide a comprehensive analysis had the power to control petitioner with the means and
of the true classification of the individual, whether as Indeed, "[t]he presence of [the] power of control is indicative
methods by which the work is to be accomplished.
employee, independent contractor, corporate officer or some of an employment relationship while the absence thereof is
other capacity. indicative of independent contractorship."33
Under the economic reality test, the petitioner can also be
said to be an employee of respondent corporation because
It is better, therefore, to adopt a two-tiered test involving: she had served the company for 6 yrs. before her dismissal, Moreover, evidence on record reveal the existence of
(1) the employer’s power to control; and receiving check vouchers indicating her salaries/wages, independent contractorship between the parties. As
(2) the economic realities of the activity or benefits, 13th month pay, bonuses and allowances, as well mentioned, the Sales Agency Agreement provided the
relationship. as deductions and Social Security contributions from. When primary evidence of such relationship. "While the existence
petitioner was designated General Manager, respondent of employer-employee relationship is a matter of law, the
The control test means that there is an employer-employee corporation made a report to the SSS. characterization made by the parties in their contract as to
relationship when the person for whom the services are Petitioner’s membership in the SSS evinces the existence of the nature of their juridical relationship cannot be simply
performed reserves the right to control not only the end an employer-employee relationship between petitioner and ignored, particularly in this case where the parties' written
achieved but also the manner and means used to achieve respondent corporation. The coverage of Social Security contract unequivocally states their intention"34 to be strictly
that end. Law is predicated on the existence of an employer-employee bound by independent contractorship. Petitioner Legatona, in
relationship. fact, in his Release and Quitclaim, acknowledged that he
There has to be analysis of the totality of economic was performing sales activities as sales agent/independent
circumstances of the worker. contractor and not an employee of respondent. In the same
token, De la Cuesta and Navasa, made sworn testimonies
Thus, the determination of the relationship between Valeroso v Skycable (202915) that petitioners are employees of Armada which is an
employer and employee depends upon the circumstances of independent contractor engaged to provide marketing
the whole economic activity, such as: services for respondent.

(1) the extent to which the services performed are Reliance by petitioners on the case of Francisco v. National
an integral part of the employer’s business; Labor Relations Commission31 is misplaced.
(2) the extent of the worker’s investment in
equipment and facilities;
In that case, the Court adopted a two-tiered test in order to
determine the true relationship between the employer and
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2. Who determines ER-E relationship disputing the employer-employee relationship, force the other terms and conditions of employment, if
referral of the matter to the NLRC. accompanied by a claim for reinstatement.

The Court issued the declaration that at least a prima facie If a complaint is filed with the NLRC, and there is still an
People's Broadcasting v Sec of showing of the absence of an employer-employee existing employer-employee relationship, the jurisdiction is
Labor (179652) relationship be made to oust the DOLE of jurisdiction. But it properly with the DOLE. The findings of the DOLE, however,
is precisely the DOLE that will be faced with that evidence, may still be questioned through a petition for certiorari under
and it is the DOLE that will weigh it, to see if the same does Rule 65 of the Rules of Court.
successfully refute the existence of an employer-employee
The question now arises, may the DOLE make a relationship.
In the present case, the finding of the DOLE Regional
determination of whether or not an employer-employee
Director that there was an employer-employee relationship
relationship exists, and if so, to what extent?
If the DOLE makes a finding that there is an existing has been subjected to review by this Court, with the finding
employer-employee relationship, it takes cognizance of the being that there was no employer-employee relationship
No limitation in the law was placed upon the power of the matter, to the exclusion of the NLRC. between petitioner and private respondent, based on the
DOLE to determine the existence of an employer-employee evidence presented.
relationship. The DOLE would have no jurisdiction only if the
employer-employee relationship has already been Private respondent presented self-serving allegations as well
No procedure was laid down where the DOLE would only terminated, or it appears, upon review, that no employer- as self-defeating evidence.10 The findings of the Regional
make a preliminary finding, that the power was primarily held employee relationship existed in the first place. Director were not based on substantial evidence, and private
by the NLRC. respondent failed to prove the existence of an employer-
employee relationship. The DOLE had no jurisdiction over
It must also be remembered that the power of the DOLE to
the case, as there was no employer-employee relationship
The law did not say that the DOLE would first seek the determine the existence of an employer-employee
present. Thus, the dismissal of the complaint against
NLRC’s determination of the existence of an employer- relationship need not necessarily result in an affirmative
petitioner is proper.
employee relationship, or that should the existence of the finding.
employer-employee relationship be disputed, the DOLE
would refer the matter to the NLRC. The DOLE may well make the determination that no
employer-employee relationship exists, thus divesting itself South Cotabato Comm. v Hon. Sto.
The DOLE must have the power to determine whether or of jurisdiction over the case. It must not be precluded from Tomas (217575)
not an employer-employee relationship exists, and from being able to reach its own conclusions, not by the parties,
there to decide whether or not to issue compliance and certainly not by this Court.
orders in accordance with Art. 128(b) of the Labor Code,
as amended by RA 7730. Under Art. 128(b) of the Labor Code, as amended by RA The Orders of the Regional Director and the Secretary of
7730, the DOLE is fully empowered to make a determination Labor do not contain clear and distinct factual basis
The DOLE, in determining the existence of an employer- as to the existence of an employer-employee relationship in necessary to establish the jurisdiction of the DOLE and to
employee relationship, has a ready set of guidelines to the exercise of its visitorial and enforcement power, subject justify the monetary awards to private respondents
follow, the same guide the courts themselves use. The to judicial review, not review by the NLRC
elements to determine the existence of an employment As can be gleaned from the above-quoted Order, the
relationship are: (1) the selection and engagement of the To recapitulate, if a complaint is brought before the DOLE to Regional Director merely noted the discovery of violations of
employee; (2) the payment of wages; (3) the power of give effect to the labor standards provisions of the Labor labor standards provisions in the course of inspection of the
dismissal; (4) the employer’s power to control the Code or other labor legislation, and there is a finding by the DXCP premises.
employee’s conduct.9 The use of this test is not solely limited DOLE that there is an existing employer-employee
to the NLRC. The DOLE Secretary, or his or her relationship, the DOLE exercises jurisdiction to the exclusion
representatives, can utilize the same test, even in the course No such categorical determination was made on the
of the NLRC. existence of an employer-employee relationship utilizing any
of inspection, making use of the same evidence that would
have been presented before the NLRC. of the guidelines set forth. In a word, the Regional Director
If the DOLE finds that there is no employer-employee had presumed, not demonstrated, the existence of the
relationship, the jurisdiction is properly with the NLRC. relationship. Of particular note is the DOLE'S failure to show
The determination of the existence of an employer-employee that petitioners, thus, exercised control over private
relationship by the DOLE must be respected. respondents' conduct in the workplace. The power of the
If a complaint is filed with the DOLE, and it is employee to control the work of the employee, or the control
accompanied by a claim for reinstatement, the test, is considered the most significant determinant of the
The expanded visitorial and enforcement power of the jurisdiction is properly with the Labor Arbiter, under Art.
DOLE granted by RA 7730 would be rendered nugatory if existence of an employer-employee relationship.27
217(3) of the Labor Code, which provides that the Labor
the alleged employer could, by the simple expedient of Arbiter has original and exclusive jurisdiction over those Neither did the Orders of the Regional Director and
cases involving wages, rates of pay, hours of work, and
LABOR LAW I under Atty. Nolasco | COMPILATION OF DOCTRINES AND LAWS | DLSU law | Quebal
Secretary of Labor state nor make reference to any concrete in case of illness, should present a medical certificate certd genuine business necessity that fully warranted the transfer
evidence to support a finding of an employer-employee by the plant doctors. from the Nasugbu, Batangas office to the main office in
relationship and justify the monetary awards to private Manila of the respondents, undoubtedly the best suited to
respondents. In this case, the employee took absence without notice and perform the tasks assigned to the resigned employees
presented an uncertified medical certificate. because of their being themselves account managers who
had recently attended seminars and trainings as such.
Substantial evidence, such as proofs of employment, clear
exercise of control, and the power to dismiss that prove such Held: Valid management prerogative
relationship and that petitioners committed the labor laws The transfer could not be validly assailed as a form of
violations they were adjudged to have committed, are 2. Transfer; Promotion/Demotion constructive dismissal, for, as held in Benguet Electric
grossly absent in this case. Furthermore, the Orders dated Cooperative v.Fianza,36management had the prerogative to
May 20, 2004 and November 8, 2004 do not even allude to determine the place where the employee is best qualified to
the substance of the interviews during the inspection that serve the interests of the business given the qualifications,
became the basis of the finding of an employer-employee training and performance of the affected employee.
Chateau Royal Sports Club v Balba
relationship.
(197492)
Secondly, although the respondents' transfer to Manila might
3. Student Assistants be potentially inconvenient for them because it would entail
additional expenses on their part aside from their being
In the resolution of whether the transfer of the respondents forced to be away from their families, it was neither
from one area of operation to another was valid, finding a unreasonable nor oppressive.
Rule X, Book III, Omnibus Rules balance between the scope and limitation of the exercise
Implementing the Labor Code of management prerogative and the employees' right to The petitioner rightly points out that the transfer would be
security of tenure is necessary.32 without demotion in rank, or without diminution of benefits
and salaries.
We have to weigh and consider, on the one hand, that
SECTION 14. Working scholars. — There is no employer- management has a wide discretion to regulate all aspects of Instead, the transfer would open the way for their eventual
employee relationship between students on one hand, and employment, including the transfer and re-assignment of career growth, with the corresponding increases in pay. It is
schools, colleges or universities on the other, where there is: employees according to the exigencies of the noted that their prompt and repeated opposition to the
business; 33 and, on the other, that the transfer constitutes transfer effectively stalled the possibility of any agreement
1. written agreement between them under which the constructive dismissal when it is unreasonable, between the parties regarding benefits or salary
former agree to work for the latter inconvenient or prejudicial to the employee, or involves adjustments.
2. in exchange for the privilege to study free of a demotion in rank or diminution of salaries, benefits
charge, and other privileges, or when the acts of discrimination,
3. provided the students are given real opportunities, insensibility or disdain on the part of the employer Thirdly, the respondents did not show by substantial
including such facilities as may be reasonable and become unbearable for the employee, forcing him to evidence that the petitioner was acting in bad faith or had ill-
forego her employment. 34 motive in ordering their transfer.1avvphi1 In contrast, the
necessary to finish their chosen courses under
urgency and genuine business necessity justifying the
such agreement.
transfer negated bad faith on the part of the petitioner.
In this case of constructive dismissal, the burden of proof lies
in the petitioner as the employer to prove that the transfer of
the employee from one area of operation to another was for Lastly, the respondents, by having voluntarily affixed their
H. Management prerogative a valid and legitimate ground, like genuine business signatures on their respective letters of appointment,
necessity.35 We are satisfied that the petitioner duly acceded to the terms and conditions of employment
1. Definition/basis incorporated therein.
discharged its burden, and thus established that, contrary to
the claim of the respondents that they had been
constructively dismissed, their transfer had been an exercise One of the terms and conditions thus incorporated was
of the petitioner's legitimate management prerogative. the prerogative of management to transfer and re-assign
San Miguel Corp v NLRC 14621-22
(2008) its employees from one job to another "as it may deem
To start with, the resignations of the account managers and necessary or advisable," to wit:
the director of sales and marketing in the Manila office
brought about the immediate need for their replacements The company reserves the right to transfer you to
SMC dismissed an employee due to several Absence with personnel having commensurate experiences and skills. any assignment from one job to another, or from
Without Notice. one department/section to another, as it may
There is an existing company policy that employees, before With the positions held by the resigned sales personnel deem necessary or advisable.
taking an absence, should notify the former 6 days prior and being undoubtedly crucial to the operations and business of
the petitioner, the resignations gave rise to an urgent and
LABOR LAW I under Atty. Nolasco | COMPILATION OF DOCTRINES AND LAWS | DLSU law | Quebal
Foods.[38] Moreover, we find that Quantum Foods, binding between the employer and the employee unless
Julie's bakeshop v Arnaiz (173882) considering the declining sales and the loss of a major shown to be grossly oppressive or contrary to law50 – as in
account in Cebu, was acting in the legitimate pursuit of what the case at bar. Recognizing the ambiguity in the subject
it considered its best interest in deciding to transfer Endico to policy, the CA was more inclined to adopt the
the head office. recommendation of petitioner corporation’s own Investigating
We agree with the CA in ruling that the transfer of Panel over that of Sliman and the NLRC.
respondents amounted to a demotion. Although there was
no diminution in pay, there was undoubtedly a demotion in
titular rank. One cannot deny the disparity between the 3. Company policies
duties and functions of a chief baker to that of a 4. Employment restriction
utility/security personnel tasked to clean and manage the
a. by Competitor
orderliness of the outside premises of the
bakeshop. Respondents were even prohibited from entering Mirant Corp v Caro (181490)
the bakeshop. The change in the nature of their work
undeniably resulted to a demeaning and humiliating work
condition. Rivera v Solidbank (163269)

It is beyond debate that petitioner corporation’s enforcement


of its Anti-Drugs Policy is an exercise of its management
prerogative. It is also a conceded fact that respondent In cases where an employee assails a contract containing a
Endico v Quantum foods (161615) "failed" to take the random drug test as scheduled, and
2009 provision prohibiting him or her from accepting competitive
under the said company policy, such failure metes the employment as against public policy, the employer has to
penalty of termination for the first offense. A plain, simple adduce evidence to prove that the restriction is reasonable
and literal application of the said policy to the omission of and not greater than necessary to protect the employer’s
respondent would have warranted his outright dismissal from legitimate business interests.54
In this case, we find no reason to disturb the conclusion of employment – if the facts were that simple in the case at bar.
the Court of Appeals that there was no constructive
dismissal. A provision on territorial limitation is necessary to guide an
Beyond debate – the facts of this case are not – and this employee of what constitutes as violation of a restrictive
disables the Court from permitting a straight application of an covenant and whether the geographic scope is co-extensive
Reassignments made by management pending investigation otherwise prima facie straightforward rule if the ends of with that in which the employer is doing business. In
of violations of company policies and procedures allegedly substantial justice have to be served. considering a territorial restriction, the facts and
committed by an employee fall within the ambit of
circumstances surrounding the case must be considered. 61
management prerogative.[36]
Issue: Is the Anti-drug policy of petitioner, which led to the
dismissal of respondent is NOT fair and reasonable and Thus, in determining whether the contract is reasonable or
The decision of Quantum Foods to transfer Endico pending tantamount to illegal dismissal? not, the trial court should consider the following factors:
investigation was a valid exercise of management
prerogative to discipline its employees. Held:
(a) whether the covenant protects a legitimate
Yes. First. The policy was not clear on what constitutes business interest of the employer;
The transfer, while incidental to the charges against Endico,
"unjustified refusal" when the subject drug policy prescribed (b) whether the covenant creates an undue burden
was not meant as a penalty, but rather as a preventive
that an employee’s "unjustified refusal" to submit to a on the employee;
measure to avoid further loss of sales and the destruction of
(c) whether the covenant is injurious to the public
Quantum Foods' image and goodwill. It was not designed to random drug test shall be punishable by the penalty of
welfare;
be the culmination of the then on-going administrative termination for the first offense. To be sure, the term
(d) whether the time and territorial limitations
investigation against Endico. "unjustified refusal" could not possibly cover all forms of contained in the covenant are reasonable; and
"refusal" as the employee’s resistance, to be punishable by (e) whether the restraint is reasonable from the
Neither was there any demotion in rank or any diminution of termination, must be "unjustified." standpoint of public policy
Endico's salary, privileges and other benefits. Endico was
being transferred to the head office as area sales manager, To the mind of the Court, it is on this area where petitioner
the same position Endico held in Cebu.[37] There was also no corporation had fallen short of making it clear to its A post-retirement competitive employment restriction is
proof that the transfer involved a diminution of Endico's employees – as well as to management – as to what types of designed to protect the employer against competition by
salary, privileges and other benefits. former employees who may retire and obtain retirement or
acts would fall under the purview of "unjustified refusal.
pension benefits and, at the same time, engage in
On the alleged inconvenience on Endico and his family competitive employment.66
because of the transfer from Cebu to the head office in Second. The penalty of termination imposed by petitioner
Parañaque, we rule that the transfer is valid, there being no corporation upon respondent fell short of being reasonable.
We have reviewed the Undertaking which respondent
showing that there was bad faith on the part of Quantum Company policies and regulations are generally valid and
impelled petitioner to sign, and find that in case of failure to
LABOR LAW I under Atty. Nolasco | COMPILATION OF DOCTRINES AND LAWS | DLSU law | Quebal
comply with the promise not to accept competitive relied on the November 7, 1995 Guidelines issued by c. Marriage; bona fide occupational
employment within one year from February 28, 1995, respondent, which reads: qualification (BFOQ)
respondent will have a cause of action against petitioner for
"protection in the courts of law."
D. Definition of the phrase "immediate member of the family
of an employee"
The words "cause of action for protection in the courts of [G.R. No. 162994. September 19,
law" are so broad and comprehensive, that they may also 2005]
1. The phrase "immediate member of the family of
include a cause of action for prohibitory and mandatory
an employee" shall refer to the employee’s
injunction against petitioner, specific performance plus
legitimate children and in default thereof to the DUNCAN ASSOCIATION vs.
damages, or a damage suit (for actual, moral and/or
employee’s collateral relatives within the third civil GLAXO
exemplary damages), all inclusive of the restitution of
degree.
the P963,619.28 which petitioner received from respondent.
The Undertaking and the Release, Waiver and Quitclaim do
not provide for the automatic forfeiture of the benefits 2. A resigned/retired employee may be allowed to
petitioner received under the SRP upon his breach of said recommend a collateral relative within the third May an employer impose conditions, restrictions or
deeds. civil degree (e.g., brother, sister, nephew or niece) consequences on an employee by reason of the latter's
as his/her replacement only in the following cases: choice to marry or choice of spouse?
Thus, the post-retirement competitive employment ban
incorporated in the Undertaking of respondent does not, on a. Where the retired/resigned employee The answer would really all depend on the particular
its face, appear to be of the same class or genre as that is single or if married has no legitimate circumstances in each case.
contemplated in Rochester. children.
Assuming that there is a company policy allowing the
b. Employment of relatives b. Where the retired/resigned dismissal, constructive13 or otherwise, of an employee by
employee’s children are still minors reason of the employee's marriage or choice of spouse, such
(below 18 years old) at the time of policy alone cannot justify the dismissal.
his/her separation from the company.
(Emphasis added) If the prohibition or restriction pertains to the choice of spouse,
UNITED KIMBERLY-CLARK rather than the choice to marry at all, there should be an
EMPLOYEES UNION – E. General Provisions examination of the rationale behind the constraint.
PHILIPPINE TRANSPORT
GENERAL WORKERS’ Again, if the restrictions or conditions bear no relevance to any
1. The privilege to recommend a replacement can
ORGANIZATION (UKCEU- interests that the employer should be concerned with, then
be exercised by the employee concerned only
PTGWO), Petitioner, once. Thus, in the following cases, a they should not be upheld.
vs. recommendee who has been hired on
KIMBERLY – CLARK PHILIPPINES, probationary status can no longer be substituted Restrictions that are nothing more than the enforcement of
INC., Respondent. with another recommendee. personal biases, such as prohibitions on marrying members
of a particular race or ethnic group, may be struck down.
a. where the recommendee fails to pass
in his performance evaluation. Let us pay particular attention to Glaxo's policy. As noted in
In this case, the Court finds that respondent acted in accord
with the CBA and the November 7, 1995 Guidelines, which, the Resolution, Glaxo belongs to the highly competitive
by agreement of the parties, may be implemented by b. where the recommendee resigns pharmaceutical industry.
respondent after January 1, 1997. without completing his probationary
period. The competitive nature of the business is further highlighted
In the present case, the parties are in agreement that, on its by the fact that pharmaceutical drugs are indispensable to
face, Article XX, Section 1 of their 1997 CBA does not c. where the recommendee is dismissed modern society, and that the rival companies tend to produce
contain any provision relative to the employment qualification for cause. drugs of like effect but marketed under respective brand
standards of recommendees of retired/resigned, deceased names. Thus, within the pharmaceutical industry, the hazard
or disabled employees of respondent who are members of of industrial espionage looms largely, more so than most other
petitioner. d. where the recommendee dies during competitive industries. To that end, Glaxo is entitled to guard
his probationary period its trade secrets, manufacturing formulas, marketing
strategies and other confidential programs and information
However, in determining the employment qualification from competitors, concomitant to its right to protect its own
standards for said recommendees, the VA should have economic interests.
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This in mind, it is but reasonable for Glaxo to be cautious Its employees are free to cultivate relationships with and not get married, or to stipulate expressly or tacitly that upon
about the social interaction of its employees with those of marry persons of their own choosing."22 getting married, a woman employee shall be deemed
companies which it directly competes with. If the employee resigned or separated, or to actually dismiss, discharge,
goes as far as sharing hearth and home with the employee of discriminate or otherwise prejudice a woman employee
It recognizes the concern arising from the possible conflict of
the rival company, there is greater cause of concern on the merely by reason of her marriage.
interest, yet dissuades the enforcement of a hasty, unilateral
part of Glaxo.
solution. It appears from the record of this case that such a
procedure was adopted in good faith by both parties. Tecson With particular regard to women, Republic Act No. 9710 or
The fear may not so much arise from the possibility of willful may find fault with the fact that Glaxo refused his request for the Magna Carta of Women51 protects women against
betrayal by its employees of trade secrets, but from the myriad transfer to the milk division, a step which, if resorted to, may discrimination in all matters relating to marriage and family
opportunities in the course of shared lives that one may have resolved the perceived conflict of interest. Yet the relations, including the right to choose freely a spouse
inadvertently divulge to the spouse confidential information procedure involved allows the transfer only if mutually agreed and to enter into marriage only with their free and full
that the rival drug company may benefit from. upon, and besides, employees cannot generally compel the consent.52
employer to transfer them from one division to another, this
being a management prerogative.
After all, the employer has no control over pillow talk. Neither Weighed against these safeguards, it becomes apparent
could it be expected that the employee maintain a higher that Brent's condition is coercive, oppressive and
fidelity to the employer than to the spouse. And finally, if no mutual resolution is arrived at, termination discriminatory. There is no rhyme or reason for
and voluntary resignation remain as viable options. Neither it.1âwphi1 It forces Cadiz to marry for economic reasons and
obtained in this case, and we have already ruled that the deprives her of the freedom to choose her status, which is a
It may be so, as petitioners argue, much of the fear is
transfer was valid and did not constitute constructive privilege that inheres in her as an intangible and inalienable
hypothetical in nature. Yet Glaxo, as with any other industry,
dismissal. If Glaxo, or any employer with a similarly drawn-out right. 53While a marriage or no-marriage qualification may be
is allowed to take reasonable steps in order to prevent
procedure, were to ultimately resort to termination, the burden justified as a "bona fide occupational qualification," Brent
potential damage from becoming actual, especially if the
would still fall upon it to establish that such termination is in must prove two factors necessitating its imposition, viz:
economic consequences are substantial. Glaxo is hardly a
accordance with the just causes as provided in Article 282 of
small-scale industry, and the pharmaceutical business seldom
the Labor Code. Without such linkage, the termination would
characterized by old-fashioned rectitude. (1) that the employment qualification is reasonably
be invalid.
related to the essential operation of the job
involved; and
Still, these concerns aside, the steps that Glaxo may employ
(2) that there is a factual basis for believing that all or
to avoid the undue divulgence of its trade secrets should be
G.R. No. 187417 substantially all persons meeting the qualification
within reason. If termination is to be considered as an option,
CHRISTINE JOY CAPIN- would be unable to properly perform the duties of
it should be only as a final resort, if there is no other way to
CADIZ, Petitioner, the job.54
avoid the conflict of interest.
vs.
BRENT HOSPITAL AND Brent has not shown the presence of neither of these factors.
In this case, Glaxo's assailed policy does not call for automatic
COLLEGES, INC., Respondent. Perforce, the Court cannot uphold the validity of said
termination, providing as it does a process that allows for
condition.
all the opportunities for a mutually agreeable solution.
Per the Employee Handbook, "every effort shall be made,
together by management and the employee, to arrive at a G.R. No. 164774 April 12,
In this case, Brent imposed on Cadiz the condition that she 2006
solution within six (6) months, either by transfer to another subsequently contract marriage with her then boyfriend for
department in a non-counter checking position, or by career STAR PAPER CORPORATION,
her to be reinstated. According to Brent, this is "in JOSEPHINE ONGSITCO &
preparation toward outside employment after Glaxo consonance with the policy against encouraging illicit or
Wellcome. SEBASTIAN CHUA, Petitioners,
common-law relations that would subvert the sacrament of vs.
marriage."49 RONALDO D. SIMBOL, WILFREDA
Employees must be prepared for possible resignation within N. COMIA & LORNA E.
six (6) months, if no other solution is feasible."21 Statutory law is replete with legislation protecting labor and ESTRELLA, Respondents.
promoting equal opportunity in employment. No less than the
This procedure is extremely reasonable under the 1987 Constitution mandates that the "State shall afford full
circumstances, and we have no problems in upholding its protection to labor, local and overseas, organized and
validity. As noted in the Resolution: "[i]n any event, from the unorganized, and promote full employment and equality of It is significant to note that in the case at bar, respondents
wordings of the contractual provision and the policy in its employment opportunities for all."50 The Labor Code of the were hired after they were found fit for the job, but were
employee handbook, it is clear that Glaxo does not impose an Philippines, meanwhile, provides: asked to resign when they married a co-employee.
absolute prohibition against relationships between its
employees and those of competitor companies. Art. 136. Stipulation against marriage. It shall be unlawful for Petitioners failed to show how the marriage of Simbol, then a
an employer to require as a condition of employment or Sheeting Machine Operator, to Alma Dayrit, then an
continuation of employment that a woman employee shall

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employee of the Repacking Section, could be detrimental to leaves and other benefits it would consequently respond for It is advisable that the stipulations be made in
its business operations. and which obviously it would have wanted to avoid. English and Tagalog or in the dialect known to the
employee. There should be two (2) witnesses to the
execution of the quitclaim who must also sign the quitclaim.
Neither did petitioners explain how this detriment will happen If that employee confesses such fact of marriage, there will
in the case of Wilfreda Comia, then a Production Helper in be no sanction; but if such employee conceals the same
the Selecting Department, who married Howard Comia, then instead of proceeding to the confessional, she will be (1) The document should be subscribed and sworn to
a helper in the cutter-machine. The policy is premised on the dismissed. This line of reasoning does not impress us as under oath preferably before
mere fear that employees married to each other will be less reflecting its true management policy or that we are being (2) any administering official of the Department of
efficient. regaled with responsible advocacy. Labor and Employment or its regional office,
(3) the Bureau of Labor Relations,
(4) the NLRC or
The questioned policy may not facially violate Article 136 of I. Quitclaims/wavers/compromise
(5) a labor attaché in a foreign country.
the Labor Code but it creates a disproportionate effect and 1. Contents
under the disparate impact theory, the only way it could
pass judicial scrutiny is a showing that it Such official shall assist the parties regarding the execution
is reasonable despite the discriminatory, albeit of the quitclaim and waiver. This compromise settlement
disproportionate, effect. becomes final and binding under Article 227 of the Labor
G.R. No. 145587 October
Code which provides that:
26, 2007
The failure of petitioners to prove a legitimate business EDI-STAFFBUILDERS
concern in imposing the questioned policy cannot prejudice INTERNATIONAL, INC., petitioner, [A]ny compromise settlement voluntarily agreed
the employee’s right to be free from arbitrary discrimination vs. upon with the assistance of the Bureau of Labor
based upon stereotypes of married persons working together NATIONAL LABOR RELATIONS Relations or the regional office of the DOLE, shall
in one company COMMISSION and ELEAZAR S. be final and binding upon the parties and the
NLRC or any court "shall not assume jurisdiction
GRAN, respondents.
over issues involved therein except in case of non-
compliance thereof or if there is prima facie
evidence that the settlement was obtained through
In order to prevent disputes on the validity and enforceability fraud, misrepresentation, or coercion.
G.R. No. 118978 May 23, 1997 of quitclaims and waivers of employees under Philippine
PHILIPPINE TELEGRAPH AND laws, said agreements should contain the following: It is made clear that the foregoing rules on quitclaim or
TELEPHONE COMPANY, * waiver shall apply only to labor contracts of OFWs in the
petitioner, absence of proof of the laws of the foreign country
vs. 1. A fixed amount as full and final compromise
settlement; agreed upon to govern said contracts. Otherwise, the
NATIONAL LABOR RELATIONS foreign laws shall apply.
COMMISSION and GRACE DE
GUZMAN, respondents. 2. The benefits of the employees if possible with
the corresponding amounts, which the employees Is the waiver and quitclaim labeled a Declaration valid? It is
are giving up in consideration of the fixed not.
compromise amount;
Petitioner would asseverate, therefore, that while it has
nothing against marriage, it nonetheless takes umbrage over The Court finds the waiver and quitclaim null and void for the
the concealment of that fact. This improbable reasoning, 3. A statement that the employer has clearly following reasons:
with interstitial distinctions, perturbs the Court since private explained to the employee in English, Filipino, or in
respondent may well be minded to claim that the imputation the dialect known to the employees—that by 1. The salary paid to Gran upon his termination, in the
of dishonesty should be the other way around. signing the waiver or quitclaim, they are forfeiting amount of SR 2,948.00, is unreasonably low. As correctly
or relinquishing their right to receive the benefits pointed out by the court a quo, the payment of SR 2,948.00
which are due them under the law; and is even lower than his monthly salary of SR 3,190.00 (USD
Petitioner would have the Court believe that although private
respondent defied its policy against its female employees 850.00).
contracting marriage, what could be an act of insubordination 4. A statement that the employees signed and
was inconsequential. executed the document voluntarily, and had fully In addition, it is also very much less than the USD 16,150.00
understood the contents of the document and that which is the amount Gran is legally entitled to get from
their consent was freely given without any threat, petitioner EDI as backwages.
What it submits as unforgivable is her concealment of that
violence, duress, intimidation, or undue influence
marriage yet, at the same time, declaring that marriage as a
exerted on their person.
trivial matter to which it supposedly has no objection. In other 2. The Declaration reveals that the payment of SR 2,948.00
words, PT & T says it gives its blessings to its female is actually the payment for Gran's salary for the services he
employees contracting marriage, despite the maternity rendered to OAB as Computer Specialist.
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If the Declaration is a quitclaim, then the consideration public policy as it leaves the weaker party—the employee— He is not an illiterate person who needs special protection.
should be much much more than the monthly salary of SR in a "take-it-or-leave-it" situation. He held a responsible position at PNB as an IT officer. It is
3,190.00 (USD 850.00)—although possibly less than the thus safe to say that he understood the contents of the Deed
estimated Gran's salaries for the remaining duration of his of Quitclaim and Release.
Certainly, the employer is being unjust to the employee as
contract and other benefits as employee of OAB.
there is no meaningful choice on the part of the employee
while the terms are unreasonably favorable to the employer. There is also no showing that the execution thereof was
A quitclaim will understandably be lower than the sum total tainted with deceit or coercion. Although he claims that he
of the amounts and benefits that can possibly be awarded to was "forced to sign"28 the quitclaim, he nonetheless signed it.
employees or to be earned for the remainder of the contract In doing so, Dalmacio was compelled by his own personal
period since it is a compromise where the employees will circumstances, not by an act attributable to PNB.
2. Valid and binding
have to forfeit a certain portion of the amounts they are
claiming in exchange for the early payment of a compromise
amount.
G.R. No. 202308
The court may however step in when such amount is PHILIPPINE NATIONAL
unconscionably low or unreasonable although the employee BANK, Petitioner G.R. No. 203882, January 11, 2016
voluntarily agreed to it. In the case of the Declaration, the vs.
amount is unreasonably small compared to the future wages
JUMELITO T. DALMACIO,
of Gran. LORELEI O.
Respondent
ILADAN, Petitioner, v. LA SUERTE
3. The factual circumstances surrounding the execution of INTERNATIONAL MANPOWER
the Declaration would show that Gran did not voluntarily and AGENCY, INC., AND DEBBIE
freely execute the document. Consider the following Generally, deeds of release, waiver or· quitclaims cannot bar LAO, Respondents.
chronology of events: employees from demanding benefits to which they are
legally entitled or from contesting the legality of their
dismissal since quitclaims are looked upon with disfavor and
a. On July 9, 1994, Gran received a copy of his are frowned upon as contrary to public policy.25 Where,
letter of termination; In the instant case, Iladan executed a resignation letter in her
however, the person making the waiver has done so
own handwriting. She also accepted the amount of
voluntarily, with a full understanding thereof, and the
P35,000.00 as financial assistance and executed an Affidavit
b. On July 10, 1994, Gran was instructed to depart consideration for the quitclaim is credible and reasonable,
the transaction must be recognized as being a valid and of Release, Waiver and Quitclaim and an Agreement, as
Saudi Arabia and required to pay his plane ticket;65 settlement and waiver of any cause of action against
binding undertaking.26
respondents.
c. On July 11, 1994, he signed the Declaration;
The requisites for a valid quitclaim are: The affidavit of waiver and the settlement were
acknowledged/subscribed before Labor Attache Romulo on
d. On July 12, 1994, Gran departed from Riyadh,
(1) that there was no fraud or deceit on the part of any August 6, 2009, and duly authenticated by the Philippine
Saudi Arabia; and
of the parties; Consulate.
(2) that the consideration for the quitclaim is credible
e. On July 21, 1994, Gran filed the Complaint and reasonable; and An affidavit of waiver duly acknowledged before a notary
before the NLRC. (3) that the contract is not contrary to law, public public is a public document which cannot be impugned by
order, public policy, morals or good customs or mere self-serving allegations. Proof of an irregularity in its
The foregoing events readily reveal that Gran was "forced" to prejudicial to a third person with a right recognized execution is absolutely essential.
sign the Declaration and constrained to receive the amount by law.27
of SR 2,948.00 even if it was against his will—since he was The Agreement likewise bears the signature of Conciliator-
told on July 10, 1994 to leave Riyadh on July 12, 1994. He Not having sufficiently proved that he was forced to sign said Mediator Diaz. Thus, the signatures of these officials
had no other choice but to sign the Declaration as he needed Deed of Quitclaim and Release, Dalmacio cannot sufficiently prove that Iladan was duly assisted when she
the amount of SR 2,948.00 for the payment of his ticket. He expediently argue that quitclaims are looked upon with signed the waiver and settlement.
could have entertained some apprehensions as to the status disfavor and considered ineffective to bar claims for the full
of his stay or safety in Saudi Arabia if he would not sign the measure of a worker's legal rights. Concededly, the presumption of regularity of official acts may
quitclaim. be rebutted by affirmative evidence of irregularity or failure to
perform a duty.28
Indeed, it cannot even be said that Dalmacio did not fully
4. The court a quo is correct in its finding that the Declaration understand the consequences of signing the Deed of In this case, no such evidence was presented. Besides,
is a contract of adhesion which should be construed against Quitclaim and Release. "[t]he Court has ruled that a waiver or quitclaim is a valid and
the employer, OAB. An adhesion contract is contrary to
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binding agreement between the parties, provided that it petition. It also covers a claim for interest that may justly To determine whether the Quitclaims signed by respondents
constitutes a credible and reasonable settlement, and that accrue in his favor during the pendency of the case. are valid, one important factor that must be taken into
the one accomplishing it has done so voluntarily and with a account is the consideration accepted by respondents;
full understanding of its import."29 the amount must constitute a reasonable settlement
In effect, while petitioner27 had the luxury of having other
equivalent to the full measure of their legal rights. In this
remedies available to it such as its petition
Absent any extant and clear proof of the alleged case, the Quitclaims signed by the respondents do not appear
for certiorari pending before the appellate court, and an
coercion and threats Iladan allegedly received from to have been made for valuable consideration. x x
eventual appeal to this Court, respondent,28 on the other
respondents that led her to terminate her employment x 33(Emphasis supplied)
hand, could no longer pursue other claims, including for
relations with respondents, it can be concluded that interests that may accrue during the pendency of the case.
Iladan resigned voluntarily. For what they did, respondents are guilty of bad faith, and
31 should suffer the consequences of their actions. One is that
In More Maritime Agencies, Inc. v. NLRC, the Court ruled
their payment of petitioner's claim should properly be treated
that:
as a voluntary settlement of his claim in full satisfaction of the
3. Generally frowned upon NLRC judgment - which thus rendered the Petition in CA-G.R.
The law does not consider as valid any agreement SP No. 124685 moot and academic.
to receive less compensation than what a worker is
entitled to recover nor prevent him from demanding
benefits to which he is entitled.
G.R. No. 209098, November 14, G.R. No. 212764, September 09,
2016 Quitclaims executed by the employees are thus 2015
commonly frowned upon as contrary to public policy
and ineffective to bar claims for the full measure of
JUAN B. the workers legal rights, considering the economic HANSEATIC SHIPPING
HERNANDEZ, Petitioner, v. CROSS disadvantage of the employee and the inevitable PHILIPPINES INC., REEDEREI
WORLD MARINE SERVICES, INC., pressure upon him by financial necessity. (Citation HANS PETERSON & SOEHNE
MYKONOS SHIPPING CO., LTD., omitted) GMBH & CO. HG AND/OR
AND ELEAZAR DIAZ, Respondents. ROSALINDA
BAUMAN, Petitioners, v. ARLES
Respondents could have simply paid the judgment award
without attaching conditions that have far-reaching BALLON, Respondent.
consequences other than those intended by a simple
Indeed, in the Affidavit, petitioner even went so far as to certify compliance with what was required under the circumstances
and warrant that he will not file any other complaint or - that is, the mandatory execution proceedings following a
prosecute any suit or action here or in any other country after favorable judgment allowed under the Labor Code. But they A cursory reading of the certification of fitness for work,
receiving the settlement amount. did not; they had to find a way to tie petitioner's hands dated November 8, 2010, reveals that it was executed by
permanently, dangling the check as bait, so to speak. To Ballon; that it does state the company-designated physician's
6. That I have no further claims whatsoever in any theory of borrow from a fairly recent ruling of the Court, "[t]he execution recommendations or disability grading; and that it basically
law against the Owners of MV "NIKOMARIN" because of the [of the documents] cannot be tolerated as it amounts to a frees Hanseatic from all its liabilities and it may be pleaded
payment made to me. That I certify and warrant that I will not deceptive scheme to unconditionally absolve employers from as a bar to any action that may be taken by any government
file any complaint or prosecute any suit or action in the every liability.32 agency.
Philippines, Panama, Japan or any other country against the
shipowners and/or the released parties herein after receiving x x x. As a rule, quitclaims and waivers or releases are looked In other words, as aptly held by the CA, the certificate of
the payment of US$66,000.00 or its peso equivalent x x upon with disfavor and frowned upon as contrary to public fitness for work is, in truth and in fact, a quitclaim.
x.25 (Emphasis in the original) policy.
In Varorient Shipping Co., Inc. v. Flores,41 the Court ruled
This waiver by petitioner in exchange for nothing has in fact that the law does not consider as valid any agreement to
They are thus ineffective to bar claims for the full measure of
become a reality, since the CA reversed the NLRC ruling, receive less compensation than what a worker is entitled to
a worker's legal rights, particularly when the following
which means that petitioner would now have to return what conditions are applicable: recover nor prevent him from demanding benefits to which
he received from the respondents, and yet he is left with no he is entitled. Quitclaims executed by the employees are,
available recourse since he agreed that he will not thus, commonly frowned upon as contrary to public policy
"prosecute any suit or action in the Philippines x x x against 1) where there is clear proof that the waiver was and ineffective to bar claims for the full measure of the
the shipowners and/or the released parties herein after wangled from an unsuspecting or gullible person, or worker's legal rights, considering the economic disadvantage
receiving the payment of US$66,000.00 or its peso of the employee and the inevitable pressure upon him by
equivalent."26 "Any suit or action" literally includes a petition (2) where the terms of settlement are financial necessity. Thus, it is never enough to assert that
before this Court to review the CA reversal - or the instant unconscionable on their face. the parties have voluntarily entered into such a quitclaim.

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There are other requisites to be met, such as: (a) that there
was no fraud or deceit on the part of any of the parties; (b)
that the consideration of the quitclaim is credible and
reasonable; and (c) that the contract is not contrary to law,
public order, public policy, morals or good customs, or
prejudicial to a third person with a right recognized by law.42

The Court is of the view that the certificate of fitness for work
in this case was a defective quitclaim because it was meant
to conceal its true intent, which was to release petitioners
from any liability arising from Ballon's claim. The execution
cannot be tolerated as it amounts to a deceptive scheme to
unconditionally absolve employers from every liability.
Likewise, no consideration was provided for the questionable
quitclaim.

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2. Labor Standards PAGPALAIN HAULERS, vs.
INC., petitioner, vs. The HON. FRANKLIN M. DRILON as
HONORABLE CRESENCIANO B. Secretary of Labor and
LABOR CODE OF THE PHILIPPINES TRAJANO, in his official capacity as Employment, and TOMAS D.
Secretary of Labor and ACHACOSO, as Administrator of
A. Preliminary title Employment, the HONORABLE the Philippine Overseas
RENATO D. PARUNGO, in his Employment
official capacity as the Med-Arbiter Administration, respondents.
in DOLE Case No. NCR-OD-M-
Chapter 1, Article 1-6, Labor Code 9705-006, and the INTEGRATED
LABOR ORGANIZATION (ILO-
The consequence the deployment ban has on the right to
PHILS) PAGPALAIN WORKERS travel does not impair the right. The right to travel is subject,
UNION-ILO-PHILS. respondents. among other things, to the requirements of "public safety,"
Article 1. Name of Decree. This Decree shall be known as
"as may be provided by law." 25 Department Order No. 1 is a
the "Labor Code of the Philippines".
valid implementation of the Labor Code, in particular, its
basic policy to "afford protection to labor," 26 pursuant to the
Article 2. Date of effectivity. This Code shall take effect six Neither can Pagpalain contend that Department Order respondent Department of Labor's rule-making authority
(6) months after its promulgation. No. 9 is an invalid exercise of rule-making power by the vested in it by the Labor Code. 27 The petitioner assumes
Secretary of Labor. For an administrative order to be valid, it that it is unreasonable simply because of its impact on the
must (i) be issued on the authority of law and (ii) it must not right to travel, but as we have stated, the right itself is not
Article 3. Declaration of basic policy. The State shall afford be contrary to the law and Constitution.[7] absolute. The disputed Order is a valid qualification thereto.
protection to labor, promote full employment, ensure equal
work opportunities regardless of sex, race or creed and Department Order No. 9 has been issued on authority
regulate the relations between workers and employers. The of law. Under the law, the Secretary is authorized to Neither is there merit in the contention that Department
State shall assure the rights of workers to self-organization, promulgate rules and regulations to implement the Labor Order No. 1 constitutes an invalid exercise of legislative
collective bargaining, security of tenure, and just and Code. Specifically, Article 5 of the Labor Code provides that power. It is true that police power is the domain of the
humane conditions of work. [t]he Department of Labor and other government agencies legislature, but it does not mean that such an authority may
charged with the administration and enforcement of this Code not be lawfully delegated. As we have mentioned, the Labor
or any of its parts shall promulgate the necessary Code itself vests the Department of Labor and Employment
Article 4. Construction in favor of labor. All doubts in the
implementing rules and regulations. Consonant with this with rulemaking powers in the enforcement whereof. 28
implementation and interpretation of the provisions of this
Code, including its implementing rules and regulations, shall article, the Secretary of Labor and Employment promulgated
the Omnibus Rules Implementing the Labor Code. By virtue
be resolved in favor of labor. The petitioners's reliance on the Constitutional guaranty of
of this self-same authority, the Secretary amended the above-
worker participation "in policy and decision-making
mentioned omnibus rules by issuing Department Order No. 9, processes affecting their rights and benefits" 29 is not well-
Article 5. Rules and regulations. The Department of Labor Series of 1997. taken. The right granted by this provision, again, must submit
and other government agencies charged with the
Moreover, Pagpalain has failed to show that to the demands and necessities of the State's power of
administration and enforcement of this Code or any of its
Department Order No. 9 is contrary to the law or the regulation.
parts shall promulgate the necessary implementing rules and
regulations. Such rules and regulations shall become Constitution.
effective fifteen (15) days after announcement of their The Constitution declares that:
adoption in newspapers of general circulation. At the risk of being repetitious, the Labor Code does not
require a local or chapter to submit books of account in order
for it to be registered as a legitimate labor organization. There Sec. 3. The State shall afford full
Article 6. Applicability. All rights and benefits granted to is, thus, no inconsistency between the Labor Code and protection to labor, local and overseas,
workers under this Code shall, except as may otherwise be Department Order No. 9.Neither has Pagpalain shown that organized and unorganized, and
provided herein, apply alike to all workers, whether said order contravenes any provision of the Constitution. promote full employment and equality of
agricultural or non-agricultural. (As amended by Presidential employment opportunities for all. 30
Decree No. 570-A, November 1, 1974)

2. Scope/application "Protection to labor" does not signify the promotion of


employment alone. What concerns the Constitution more
paramountly is that such an employment be above all,
1. Rule-making power decent, just, and humane. It is bad enough that the country
has to send its sons and daughters to strange lands because
G.R. No. 81958 June 30, 1988
it cannot satisfy their employment needs at home. Under
PHILIPPINE ASSOCIATION OF
these circumstances, the Government is duty-bound to
SERVICE EXPORTERS, insure that our toiling expatriates have adequate protection,
[G.R. No. 133215. July 15, 1999]
INC., petitioner,
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personally and economically, while away from home. In this (SEAFDEC-AQD), DR. FLOR Permanent international commissions
case, the Government has evidence, an evidence the LACANILAO (CHIEF), RUFIL and administrative bodies have been
petitioner cannot seriously dispute, of the lack or inadequacy CUEVAS (HEAD, created by the agreement of a
of such protection, and as part of its duty, it has precisely ADMINISTRATIVE DIV.), BEN considerable number of States for a
ordered an indefinite ban on deployment. DELOS REYES (FINANCE variety of international purposes,
OFFICER), petitioners, economic or social and mainly non-
political. Among the notable instances
The Court finds furthermore that the Government has not vs.
are the International Labor Organization,
indiscriminately made use of its authority. It is not contested NATIONAL LABOR RELATIONS
the International Institute of Agriculture,
that it has in fact removed the prohibition with respect to COMMISSION and JUVENAL the International Danube Commission.
certain countries as manifested by the Solicitor General. LAZAGA, respondents. In so far as they are autonomous and
beyond the control of any one State,
As a matter of judicial notice, the Court is well aware of the they have a distinct juridical personality
unhappy plight that has befallen our female labor force independent of the municipal law of the
Thereafter, petitioners instituted this petition
abroad, especially domestic servants, amid exploitative State where they are situated. As such,
for certiorari alleging that the NLRC has no jurisdiction to
working conditions marked by, in not a few cases, physical according to one leading authority "they
hear and decide respondent Lazaga's complaint since
and personal abuse. must be deemed to possess a species
SEAFDEC-AQD is immune from suit owing to its
of international personality of their own."
international character and the complaint is in effect a suit
(Salonga and Yap, Public International
The sordid tales of maltreatment suffered by migrant Filipina against the State which cannot be maintained without its
Law, 83 [1956 ed.])
workers, even rape and various forms of torture, confirmed consent.
by testimonies of returning workers, are compelling motives
for urgent Government action. As precisely the caretaker of The petition is impressed with merit.
Constitutional rights, the Court is called upon to protect
Postigo v Philippie Tuberculosis
victims of exploitation. In fulfilling that duty, the Court
sustains the Government's efforts. Petitioner Southeast Asian Fisheries Development Center- Society (155140)
Aquaculture Department (SEAFDEC-AQD) is an
international agency beyond the jurisdiction of public
The same, however, cannot be said of our male workers. In respondent NLRC.
the first place, there is no evidence that, except perhaps for Having determined the applicable implementing rules, we
isolated instances, our men abroad have been afflicted with now proceed to resolve whether the respondent is a private
an Identical predicament. It was established by the Governments of Burma, Kingdom corporation or a public corporation; and consequently,
of Cambodia, Republic of Indonesia, Japan, Kingdom of whether the petitioners are employees in the private sector
Laos, Malaysia. Republic of the Philippines, Republic of or in the public sector.
The petitioner has proffered no argument that the Singapore, Kingdom of Thailand and Republic of Vietnam
Government should act similarly with respect to male (Annex "H", Petition).
workers. The Court, of course, is not impressing some male On this score, the case of Feliciano v. Commission
chauvinistic notion that men are superior to women. What on Audit,[19] finds strong relevance. Although with different
the Court is saying is that it was largely a matter of evidence The Republic of the Philippines became a signatory to the factual circumstances, the Court discussed therein the two
(that women domestic workers are being ill-treated abroad in Agreement establishing SEAFDEC on January 16,1968. Its classes of corporations recognized by the 1987 Constitution.
massive instances) and not upon some fanciful or arbitrary purpose is as follows:
yardstick that the Government acted in this case. It is The first refers to private corporations created
evidence capable indeed of unquestionable demonstration under a general law; the second refers to government-owned
SEAFDEC-AQD was organized during the Sixth Council
and evidence this Court accepts. or controlled corporations created by special charters. We
Meeting of SEAFDEC on July 3-7, 1973 in Kuala Lumpur,
Malaysia as one of the principal departments of SEAFDEC also reiterated that under Section 14 of the Corporation Code,
The Court cannot, however, say the same thing as far as (Annex "I", id.) to be established in Iloilo for the promotion of [a]ll corporations organized under this Code shall file with the
men are concerned. There is simply no evidence to justify research in aquaculture. Securities and Exchange Commission articles of incorporation
such an inference. Suffice it to state, then, that insofar as
classifications are concerned, this Court is content that The respondent was incorporated on March 11,
Being an intergovernmental organization, SEAFDEC
distinctions are borne by the evidence. Discrimination in this 1960 as a non-profit, benevolent and non-stock corporation
including its Departments (AQD), enjoys functional
case is justified. under the Corporation Code.[20]
independence and freedom from control of the state in
whose territory its office is located.
Having been created under the general corporation
G.R. No. 86773 February 14, 1992 law instead of a special charter, we hold that the respondent
As Senator Jovito R. Salonga and Former Chief Justice
SOUTHEAST ASIAN FISHERIES is a private and not a governmental corporation. More so,
Pedro L. Yap stated in their book, Public International Law
DEVELOPMENT CENTER- Section 2(1), Article IX(B) of the 1987 Constitution provides:
(p. 83, 1956 ed.):
SECTION 2. (1) The civil
AQUACULTURE DEPARTMENT
service embraces all branches,
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subdivisions, instrumentalities, and Neither do we find merit in the respondents are government employees, jurisdiction over their complaints
agencies of the Government, including argument that the rationale behind the enactment of Rep. Act lies not with the NLRC, but with the CSC.
government-owned or controlled No. 7641 justifies the exclusion of employees in the public
corporations with original charters. sector, who are already enjoying retirement benefits under the
GSIS law, from the New Retirement Law. Petitioners, on the other hand, contend that since they do not
belong to the approved plantilla of government personnel,
We direct the respondents attention to Section 2 of their complaints for illegal dismissal was properly made before
Extant on the records is the respondents admission that the NLRC.
although its employees are compulsory members of the GSIS, Rep. Act No. 7641, to wit:
said employees are not governed by the Civil Service Law. SEC. 2. Nothing in this Act
shall deprive any employee of benefits to
which he may be entitled under existing Let us clarify the matter.
laws or company policies or practices.
If the respondent is truly a government-owned or controlled
corporation, and petitioners are employees in the public Presidential Decree (PD) No. 807 or the Civil Service Decree
sector, then, they should have been covered by said law. The of the Philippines[20] declares that the Civil Service
truth, however, is that, the respondent is a non-profit but In addition, Rule II of the Rules Implementing Book Commission shall be the central personnel agency to set
private corporation organized under the Corporation Code, VI of the Labor Code provides as follows: standards and to enforce the laws governing the discipline of
and the petitioners are covered by the Labor Code and not by SEC. 8. Relation to civil servants.[21] PD No. 807 categorically described the
the Civil Service Law. agreements and regulations. Nothing scope of the civil service as embracing every branch, agency,
in this Rule shall justify an employer from subdivision, and instrumentality of the government, including
withdrawing or reducing any benefits, every government-owned or controlled corporations whether
From the foregoing, it is clear to us that the supplements or payments as provided in performing governmental or proprietary function;[22] and
petitioners are employees in the private sector, hence entitled existing laws, individual or collective construed an agency to mean any bureau, office, commission,
to the benefits of Rep. Act No. 7641. agreements or employment practices or administration, board, committee, institute, corporation,
policies. whether performing governmental or proprietary function, or
Even assuming that by virtue of their compulsory any other unit of the National Government, as well as
inclusion in the GSIS, the petitioners became employees in provincial, city or municipal government, except as otherwise
the public sector, they are still entitled to the benefits of Rep. In Juco v. NLRC,[22] we clarified that employees of provided.[23]
Act No. 7641 since they are not covered by the Civil Service government-owned and controlled corporations with special
Law and its regulations. This much is certain upon reading the charters are covered under the Civil Service.
implementing rules of Title II, Book VI of the Labor Code as Subsequently, Executive Order (EO) No. 180[24] defined
afore-cited as well as the Labor Advisory on Retirement Pay government employees as all employees of all branches,
Law.[21] Under the said advisory, the coverage of, as well as On the other hand, employees of government- subdivisions, instrumentalities, and agencies of the
the exclusion from, Rep. Act No. 7641 has been delineated as owned and controlled corporations under the Corporation Government, including government-owned or controlled
follows: Code are governed by the provisions of the Labor Code. corporations with original charters.[25] It provided that the Civil
RA 7641 or the Retirement Pay Service and labor laws shall be followed in the resolution of
Law shall apply to all employees in the The Philippine Tuberculosis Society, Inc. (PTSI) complaints, grievances and cases involving government
private sector, regardless of their belongs to the latter category and, therefore, covered by Rep. employees.[26]
position, designation or status and Act No. 7641 which is an amendment to the Labor Code. The
irrespective of the method by which their accommodation under Rep. Act No. 1820 extending GSIS
wages are paid. They shall include part- coverage to PTSI employees did not take away from In Philippine Refining Company v. Court of
time employees, employees of service petitioners the beneficial coverage afforded by Rep. Act No. Appeals,[27] we declared that AFPCES is a government
and other job contractors and domestic 7641. Hence, the retirement pay payable under Article 287 of agency that is not immune from suit since it is engaged
helpers or persons in the personal the Labor Code as amended by Rep. Act No. 7641 should be in proprietary activities.
service of another. considered apart from the retirement benefit claimable by the
petitioners under the social security law or, as in this case, the
The law does not GSIS law. We find no compelling reason to deviate from such
cover employees of retail, service and pronouncement.
agricultural establishments or operations
employing not more than (10) employees
The historical background of its creation and establishment
or workers and employees of the Hidalgo v Republic (179793)
National Government and its political indicates that AFPCES is an agency under the direct control
subdivisions, including Government- and supervision of the AFP as it was established to take
charge of the operations and management of all commissary
owned and/or controlled corporations, if
they are covered by the Civil Service Law facilities in military establishments all over the country.
Pivotal to the resolution of this petition is a determination of
and its regulations. (Underscoring ours.) the classification of petitioners employment status with
respondent AFPCES. AFPCES asserts that since petitioners
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By clear implication of law, all AFPCES personnel should manner of its creation such that government "License" means a document issued by the Department of
therefore be classified as government employees and any corporations created by special charter are subject to its Labor authorizing a person or entity to operate a private
appointment, promotion, discipline and termination of its provisions while those incorporated under the general employment agency.
civilian staff should be governed by appropriate civil service Corporation Law are not within its coverage.
laws and procedures.
"Private recruitment entity" means any person or association
We hold, therefore, that the PNOC-EDC having been engaged in the recruitment and placement of workers, locally
Interestingly, in the course of the proceedings, petitioners did incorporated under the general Corporation Law, is a or overseas, without charging, directly or indirectly, any fee
government-owned or controlled corporation whose from the workers or employers.
not question or refute such classification of the AFPCES.
They, in fact, averred that AFPCES is not created by a special employees are subject to the provisions of the Labor Code.
law to classify it as a government-owned or controlled This is apparently the intendment in the NASECO case
"Authority" means a document issued by the Department of
notwithstanding the fact that the NASECO therein was a
corporation with original charter, but a mere entity of the AFP. Labor authorizing a person or association to engage in
subsidiary of the PNB, a government-owned corporation.
recruitment and placement activities as a private recruitment
entity.
They also admit that AFPCES is without any corporate B. Recruitment and placement
features as it is merely an agency performing proprietary 1. Illegal recruitment
functions not only for the benefit of veterans, their widows and "Seaman" means any person employed in a vessel engaged
orphans, and the members of the AFP, but for the public in in maritime navigation.
general.[
"Overseas employment" means employment of a worker
Articles 13, 14, 18, 21, 22, 25, 26,
outside the Philippines.
27, 28-35, 36-38, Labor Code

G.R. No. L-58494 July 5, 1989 "Emigrant" means any person, worker or otherwise, who
emigrates to a foreign country by virtue of an immigrant visa
PHILIPPINE NATIONAL OIL
Title I or resident permit or its equivalent in the country of
COMPANY-ENERGY destination.
RECRUITMENT AND PLACEMENT OF WORKERS
DEVELOPMENT
CORPORATION, petitioner,
vs. Chapter I Article 14. Employment promotion. The Secretary of Labor
HON. VICENTE T. LEOGARDO, GENERAL PROVISIONS shall have the power and authority:
DEPUTY MINISTER OF LABOR
AND VICENTE D. Article 13. Definitions. To organize and establish new employment offices in
ELLELINA, respondents. addition to the existing employment offices under the
Department of Labor as the need arises;
"Worker" means any member of the labor force, whether
employed or unemployed.
In National Housing Corporation vs. Juco (L-64313, January To organize and establish a nationwide job clearance and
17, 1985, 134 SCRA 172), we laid down the doctrine that information system to inform applicants registering with a
"Recruitment and placement" refers to any act of particular employment office of job opportunities in other
employees of government-owned and/or controlled canvassing, enlisting, contracting, transporting, utilizing,
corporations, whether created by special law or formed as parts of the country as well as job opportunities abroad;
hiring or procuring workers, and includes referrals, contract
subsidiaries under the general Corporation Law, are services, promising or advertising for employment, locally or
governed by the Civil Service Law and not by the Labor abroad, whether for profit or not: To develop and organize a program that will facilitate
Code. occupational, industrial and geographical mobility of labor
and provide assistance in the relocation of workers from one
Provided, That any person or entity which, in any manner, area to another; and
However, the above doctrine has been supplanted by the offers or promises for a fee, employment to two or more
present Constitution, which provides: persons shall be deemed engaged in recruitment and
placement. To require any person, establishment, organization or
The Civil Service embraces all branches, subdivisions, institution to submit such employment information as may be
instrumentalities and agencies of the Government, including prescribed by the Secretary of Labor.
"Private fee-charging employment agency" means any
government-owned or controlled corporations with original person or entity engaged in recruitment and placement of
charters. (Article IX-B, Section 2 [1]) workers for a fee which is charged, directly or indirectly, from Article 18. Ban on direct-hiring. No employer may hire a
the workers or employers or both. Filipino worker for overseas employment except through the
Thus, under the present state of the law, the test in Boards and entities authorized by the Secretary of Labor.
determining whether a government-owned or controlled Direct-hiring by members of the diplomatic corps,
corporation is subject to the Civil Service Law is the international organizations and such other employers as may
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be allowed by the Secretary of Labor is exempted from this placement of workers for overseas employment whether for Article 34. Prohibited practices. It shall be unlawful for any
provision. profit or not. individual, entity, licensee, or holder of authority:

Article 21. Foreign service role and participation. To provide Article 27. Citizenship requirement. Only Filipino citizens or (1) To charge or accept, directly or indirectly, any
ample protection to Filipino workers abroad, the labor corporations, partnerships or entities at least seventy-five amount greater than that specified in the schedule
attaches, the labor reporting officers duly designated by the percent (75%) of the authorized and voting capital stock of allowable fees prescribed by the Secretary of
Secretary of Labor and the Philippine diplomatic or consular of which is owned and controlled by Filipino citizens Labor, or to make a worker pay any amount
officials concerned shall, even without prior instruction or shall be permitted to participate in the recruitment and greater than that actually received by him as a
advice from the home office, exercise the power and duty: placement of workers, locally or overseas. loan or advance;
(2) To furnish or publish any false notice or
information or document in relation to recruitment
(1) To provide all Filipino workers within their Article 28. Capitalization. All applicants for authority to hire
or employment;
jurisdiction assistance on all matters arising out of or renewal of license to recruit are required to have such
(3) To give any false notice, testimony, information or
employment; substantial capitalization as determined by the Secretary of
document or commit any act of misrepresentation
(2) To insure that Filipino workers are not exploited or Labor.
for the purpose of securing a license or authority
discriminated against; under this Code.
(3) To verify and certify as requisite to authentication Article 29. Non-transferability of license or authority. No (4) To induce or attempt to induce a worker already
that the terms and conditions of employment in license or authority shall be used directly or indirectly by any employed to quit his employment in order to offer
contracts involving Filipino workers are in person other than the one in whose favor it was issued or at him to another unless the transfer is designed to
accordance with the Labor Code and rules and any place other than that stated in the license or authority be liberate the worker from oppressive terms and
regulations of the Overseas Employment transferred, conveyed or assigned to any other person or conditions of employment;
Development Board and National Seamen Board; entity. Any transfer of business address, appointment or (5) To influence or to attempt to influence any person
(4) To make continuing studies or researches and designation of any agent or representative including the or entity not to employ any worker who has not
recommendations on the various aspects of the establishment of additional offices anywhere shall be subject applied for employment through his agency;
employment market within their jurisdiction; to the prior approval of the Department of Labor. (6) To engage in the recruitment or placement of
(5) To gather and analyze information on the workers in jobs harmful to public health or morality
employment situation and its probable trends, and or to the dignity of the Republic of the Philippines;
to make such information available; and Article 30. Registration fees. The Secretary of Labor shall (7) To obstruct or attempt to obstruct inspection by the
(6) To perform such other duties as may be required promulgate a schedule of fees for the registration of all Secretary of Labor or by his duly authorized
of them from time to time. applicants for license or authority. representatives;
(8) To fail to file reports on the status of employment,
Article 22. Mandatory remittance of foreign exchange Article 31. Bonds. All applicants for license or authority shall placement vacancies, remittance of foreign
earnings. It shall be mandatory for all Filipino workers abroad post such cash and surety bonds as determined by the exchange earnings, separation from jobs,
to remit a portion of their foreign exchange earnings to their Secretary of Labor to guarantee compliance with prescribed departures and such other matters or information
families, dependents, and/or beneficiaries in the country in recruitment procedures, rules and regulations, and terms as may be required by the Secretary of Labor.
accordance with rules and regulations prescribed by the and conditions of employment as may be appropriate. (9) To substitute or alter employment contracts
Secretary of Labor. approved and verified by the Department of Labor
from the time of actual signing thereof by the
Article 32. Fees to be paid by workers. Any person applying parties up to and including the periods of
Chapter II with a private fee-charging employment agency for expiration of the same without the approval of the
REGULATION OF RECRUITMENT AND PLACEMENT employment assistance shall not be charged any fee until he Secretary of Labor;
ACTIVITIES has obtained employment through its efforts or has actually (10) To become an officer or member of the Board of
commenced employment. Such fee shall be always covered any corporation engaged in travel agency or to be
with the appropriate receipt clearly showing the amount paid. engaged directly or indirectly in the management
Article 25. Private sector participation in the recruitment and The Secretary of Labor shall promulgate a schedule of
placement of workers. Pursuant to national development of a travel agency; and
allowable fees. (11) To withhold or deny travel documents from
objectives and in order to harness and maximize the use of
private sector resources and initiative in the development applicant workers before departure for monetary or
and implementation of a comprehensive employment Article 33. Reports on employment status. Whenever the financial considerations other than those
program, the private employment sector shall participate in public interest requires, the Secretary of Labor may direct all authorized under this Code and its implementing
the recruitment and placement of workers, locally and persons or entities within the coverage of this Title to submit rules and regulations.
overseas, under such guidelines, rules and regulations as a report on the status of employment, including job
may be issued by the Secretary of Labor. vacancies, details of job requisitions, separation from jobs, Article 35. Suspension and/or cancellation of license or
wages, other terms and conditions and other employment authority. The Minister of Labor shall have the power to
data. suspend or cancel any license or authority to recruit
Article 26. Travel agencies prohibited to recruit. Travel
agencies and sales agencies of airline companies are employees for overseas employment for violation of rules
prohibited from engaging in the business of recruitment and and regulations issued by the Ministry of Labor, the
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Overseas Employment Development Board, or for violation shall be issued by the Philippine Overseas Employment or advertising for employment abroad, whether for profit or
of the provisions of this and other applicable laws, General Administration (POEA). not, when undertaken by non-licensee or non-holder of
Orders and Letters of Instructions. authority contemplated under Article 13(f) of Presidential
Decree No. 442, as amended, otherwise known as the Labor
"The members of the POEA Governing Board who actually
Code of the Philippines: Provided, That any such non-
voted in favor of an order allowing the deployment of migrant
licensee or non-holder who, in any manner, offers or
workers without any of the aforementioned guarantees shall
R.A. No. 8042, as amended by R.A. promises for a fee employment abroad to two or more
suffer the penalties of removal or dismissal from service with
No. 1022 persons shall be deemed so engaged. It shall likewise
disqualification to hold any appointive public office for five (5)
include the following acts, whether committed by any person,
years, Further, the government official or employee
whether a non-licensee, non-holder, licensee or holder of
responsible for the issuance of the permit or for allowing the
authority:
deployment of migrant workers in violation of this section and
Section 2. Section 3, paragraph (a) of Republic Act No. in direct contravention of an order by the POEA Governing
8042, as amended, is hereby amended to read as follows: Board prohibiting deployment shall be meted the same "(a) To charge or accept directly or indirectly any
penalties in this section. amount greater than that specified in the schedule
"(a) "Overseas Filipino worker" refers to a person who is to of allowable fees prescribed by the Secretary of
be engaged, is engaged or has been engaged in a Labor and Employment, or to make a worker pay
"For this purpose, the Department of Foreign Affairs, through
remunerated activity in a state of which he or she is not a or acknowledge any amount greater than that
its foreign posts, shall issue a certification to the POEA,
citizen or on board a vessel navigating the foreign seas other actually received by him as a loan or advance;
specifying therein the pertinent provisions of the receiving
than a government ship used for miliatry or non-commercial country's labor/social law, or the
purposes or on an installation located offshore or on the high convention/declaration/resolution, or the bilateral "(b) To furnish or publish any false notice or
seas; to be used interchangeably with migrant worker." agreement/arrangement which protect the rights of migrant information or document in relation to recruitment
workers. or employment;
Section 3. Section 4 of Republic Act No. 8042, as amended,
is hereby amended to rerad as follows: "The State shall also allow the deployment of overseas "(c) To give any false notice, testimony,
Filipino workers to vessels navigating the foreign seas or to information or document or commit any act of
"SEC. 4. Deployment of Migrant Workers. - The State shall installations located offshore or on high seas whose misrepresentation for the purpose of securing a
allow the deployment of overseas Filipino workers only in owners/employers are compliant with international laws and license or authority under the Labor Code, or for
countries where the rights of Filipino migrant workers are standards that protect the rights of migrant workers. the purpose of documenting hired workers with the
protected. The government recognizes any of the following POEA, which include the act of reprocessing
as a guarantee on the part of the receiving country for the workers through a job order that pertains to
"The State shall likewise allow the deployment of overseas
protection of the rights of overseas Filipino workers: nonexistent work, work different from the actual
Filipino workers to companies and contractors with
overseas work, or work with a different employer
international operations: Provided, That they are compliant
whether registered or not with the POEA;
"(a) It has existing labor and social laws protecting with standards, conditions and requirements, as embodied in
the rights of workers, including migrant workers; the employment contracts prescribed by the POEA and in
accordance with internationally-accepted standards." "(d) To include or attempt to induce a worker
already employed to quit his employment in order
"(b) It is a signatory to and/or a ratifier of to offer him another unless the transfer is designed
multilateral conventions, declarations or Section 4. Section 5 of Republic Act No. 8042, as amended,
to liberate a worker from oppressive terms and
resolutions relating to the protection of workers, is hereby amended to read as follows:
conditions of employment;
including migrant workers; and
"SEC. 5. Termination or Ban on Deployment. -
"(e) To influence or attempt to influence any
"(c) It has concluded a bilateral agreement or Notwithstanding the provisions of Section 4 hereof, in pursuit
person or entity not to employ any worker who has
arrangement with the government on the of the national interest or when public welfare so requires,
not applied for employment through his agency or
protection of the rights of overseas Filipino the POEA Governing Board, after consultation with the
who has formed, joined or supported, or has
Workers: Department of Foreign Affairs, may, at any time, terminate or
contacted or is supported by any union or workers'
impose a ban on the deployment of migrant workers."
organization;
Provided, That the receiving country is taking positive,
concrete measures to protect the rights of migrant workers in Section 5. Section 6 of Republic Act No. 8042, as amended,
"(f) To engage in the recruitment or placement of
furtherance of any of the guarantees under subparagraphs is hereby amended to read as follows:
workers in jobs harmful to public health or morality
(a), (b) and (c) hereof. or to the dignity of the Republic of the Philippines;
"SEC. 6. Definition. - For purposes of this Act, illegal
"In the absence of a clear showing that any of the recruitment shall mean any act of canvassing, enlisting,
"(h) To fail to submit reports on the status of
aforementioned guarantees exists in the country of contracting, transporting, utilizing, hiring, or procuring
employment, placement vacancies, remittance of
destination of the migrant workers, no permit for deployment workers and includes referring, contract services, promising
foreign exchange earnings, separation from jobs,
LABOR LAW I under Atty. Nolasco | COMPILATION OF DOCTRINES AND LAWS | DLSU law | Quebal
departures and such other matters or information annum, which will be used for payment of legal "In the filing of cases for illegal recruitment or any of the
as may be required by the Secretary of Labor and and allowable placement fees and make the prohibited acts under this section, the Secretary of Labor and
Employment; migrant worker issue, either personally or through Employment, the POEA Administrator or their duly
a guarantor or accommodation party, postdated authorized representatives, or any aggrieved person may
checks in relation to the said loan; initiate the corresponding criminal action with the appropriate
"(i) To substitute or alter to the prejudice of the
office. For this purpose, the affidavits and testimonies of
worker, employment contracts approved and
operatives or personnel from the Department of Labor and
verified by the Department of Labor and "(2) Impose a compulsory and exclusive
Employment, POEA and other law enforcement agencies
Employment from the time of actual signing arrangement whereby an overseas Filipino worker
who witnessed the acts constituting the offense shall be
thereof by the parties up to and including the is required to avail of a loan only from specifically
sufficient to prosecute the accused.
period of the expiration of the same without the designated institutions, entities or persons;
approval of the Department of Labor and
Employment; "In the prosecution of offenses punishable under this section,
"(3) Refuse to condone or renegotiate a loan
the public prosecutors of the Department of Justice shall
incurred by an overseas Filipino worker after the
collaborate with the anti-illegal recruitment branch of the
"(j) For an officer or agent of a recruitment or latter's employment contract has been prematurely
POEA and, in certain cases, allow the POEA lawyers to take
placement agency to become an officer or terminated through no fault of his or her own;
the lead in the prosecution. The POEA lawyers who act as
member of the Board of any corporation engaged
prosecutors in such cases shall be entitled to receive
in travel agency or to be engaged directly or
"(4) Impose a compulsory and exclusive additional allowances as may be determined by the POEA
indirectly in the management of travel agency;
arrangement whereby an overseas Filipino worker Administrator.
is required to undergo health examinations only
"(k) To withhold or deny travel documents from from specifically designated medical clinics,
"The filing of an offense punishable under this Act shall be
applicant workers before departure for monetary or institutions, entities or persons, except in the case
without prejudice to the filing of cases punishable under
financial considerations, or for any other reasons, of a seafarer whose medical examination cost is
other existing laws, rules or regulations."1avvphi1
other than those authorized under the Labor Code shouldered by the principal/shipowner;
and its implementing rules and regulations;
Section 7. Section 10 of Republic Act No. 8042, as
"(5) Impose a compulsory and exclusive
amended, is hereby amended to read as follows:
"(l) Failure to actually deploy a contracted worker arrangement whereby an overseas Filipino worker
without valid reason as determined by the is required to undergo training, seminar, instruction
Department of Labor and Employment; or schooling of any kind only from specifically "SEC. 10. Money Claims. - Notwithstanding any provision of
designated institutions, entities or persons, except law to the contrary, the Labor Arbiters of the National Labor
fpr recommendatory trainings mandated by Relations Commission (NLRC) shall have the original and
"(m) Failure to reimburse expenses incurred by the
principals/shipowners where the latter shoulder the exclusive jurisdiction to hear and decide, within ninety (90)
worker in connection with his documentation and
cost of such trainings; calendar days after the filing of the complaint, the claims
processing for purposes of deployment, in cases
arising out of an employer-employee relationship or by virtue
where the deployment does not actually take place
of any law or contract involving Filipino workers for overseas
without the worker's fault. Illegal recruitment when "(6) For a suspended recruitment/manning agency
deployment including claims for actual, moral, exemplary
committed by a syndicate or in large scale shall be to engage in any kind of recruitment activity
and other forms of damage. Consistent with this mandate,
considered an offense involving economic including the processing of pending workers'
the NLRC shall endeavor to update and keep abreast with
sabotage; and applications; and
the developments in the global services industry.

"(n) To allow a non-Filipino citizen to head or "(7) For a recruitment/manning agency or a foreign
"The liability of the principal/employer and the
manage a licensed recruitment/manning agency. principal/employer to pass on the overseas Filipino
recruitment/placement agency for any and all claims under
worker or deduct from his or her salary the
this section shall be joint and several. This provision shall be
payment of the cost of insurance fees, premium or
"Illegal recruitment is deemed committed by a syndicate if incorporated in the contract for overseas employment and
other insurance related charges, as provided
carried out by a group of three (3) or more persons shall be a condition precedent for its approval. The
under the compulsory worker's insurance
conspiring or confederating with one another. It is deemed performance bond to de filed by the recruitment/placement
coverage.
committed in large scale if committed against three (3) or agency, as provided by law, shall be answerable for all
more persons individually or as a group. money claims or damages that may be awarded to the
"The persons criminally liable for the above offenses are the workers. If the recruitment/placement agency is a juridical
principals, accomplices and accessories. In case of juridical being, the corporate officers and directors and partners as
"In addition to the acts enumerated above, it shall also be the case may be, shall themselves be jointly and solidarily
persons, the officers having ownership, control, management
unlawful for any person or entity to commit the following
or direction of their business who are responsible for the liable with the corporation or partnership for the aforesaid
prohibited acts:
commission of the offense and the responsible claims and damages.
employees/agents thereof shall be liable.
"(1) Grant a loan to an overseas Filipino worker
with interest exceeding eight percent (8%) per
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"Such liabilities shall continue during the entire period or a. Definition Clearly, the agency and Modern Metal committed a
duration of the employment contract and shall not be b. Prohibited acts prohibited practice and engaged in illegal recruitment under
affected by any substitution, amendment or modification the law. Article 34 of the Labor Code
made locally or in a foreign country of the said contract.
Art. 34. Prohibited Practices. It shall be unlawful for any
"Any compromise/amicable settlement or voluntary individual, entity, licensee, or holder of authority:
agreement on money claims inclusive of damages under this [G.R. NO. 197528 - September 5,
section shall be paid within thirty (30) days from approval of 2012] x x x
the settlement by the appropriate authority.

PERT/CPM MANPOWER (i) To substitute or alter employment contracts approved and


"In case of termination of overseas employment without just,
EXPONENT CO., verified by the Department of Labor from the time of actual
valid or authorized cause as defined by law or contract, or
INC., Petitioner, v. ARMANDO A. signing thereof by the parties up to and including the periods
any unauthorized deductions from the migrant worker's
VINUY A, LOUIE M. ORDOVEZ, of expiration of the same without the approval of the
salary, the worker shall be entitled to the full reimbursement
ARSENIO S. LUMANTA,. JR., Secretary of Labor.
if his placement fee and the deductions made with interest at
twelve percent (12%) per annum, plus his salaries for the ROBELITO S. ANIPAN, VIRGILIO
unexpired portion of his employment contract or for three (3) R. ALCANTARA, MARINO M. ERA, Further, Article 38 of the Labor Code, as amended by R.A.
months for every year of the unexpired term, whichever is SANDY 0. ENJAMBRE and NOEL 8042,35ςrνll defined "illegal recruitment" to include the
less. T. LADEA, Respondents. following

"In case of a final and executory judgement against a foreign (i) To substitute or alter to the prejudice of the worker,
employer/principal, it shall be automatically disqualified, employment contracts approved and verified by the
without further proceedings, from participating in the The agency and its principal, Modern Metal, committed Department of Labor and Employment from the time of
Philippine Overseas Employment Program and from flagrant violations of the law on overseas employment, as actual signing thereof by the parties up to and including the
recruiting and hiring Filipino workers until and unless it fully well as basic norms of decency and fair play in an period of the expiration of the same without the approval of
satisfies the judgement award. employment relationship, pushing the respondents to look for the Department of Labor and Employment.
a better employment and, ultimately, to resign from their
jobs.
"Noncompliance with the mandatory periods for resolutions c. Who may be liable
of case provided under this section shall subject the
responsible officials to any or all of the following penalties: First. The agency and Modern Metal are guilty of contract
substitution. The respondents entered into a POEA-
approved two-year employment contract,31ςrνll with G.R. No.
"(a) The salary of any such official who fails to Modern Metal providing among others, as earlier discussed,
render his decision or resolution within the 152642 November 13,
for a monthly salary of 1350 AED. On April 2, 2007, Modern
prescribed period shall be, or caused to be, 2012
Metal issued to them appointment letters32ςrνll whereby the
withheld until the said official complies therewith; HON. PATRICIA A. STO.TOMAS,
respondents were hired for a longer three-year period and a
reduced salary, from 1,100 AED to 1,200 AED, among other ROSALINDA BALDOZ and LUCITA
"(b) Suspension for not more than ninety (90) provisions. Then, on May 5, 2007, they were required to sign LAZO, Petitioners,
days; or new employment contracts33ςrνll reflecting the same terms vs.
contained in their appointment letters, except that this time, REY SALAC, WILLIE D. ESPIRITU,
they were hired as "ordinary laborer," no longer aluminum MARIO MONTENEGRO, DODGIE
"(c) Dismissal from the service with disqualification fabricator/installer. The respondents complained with the BELONIO, LOLIT SALINEL and
to hold any appointive public office for five (5) agency about the contract substitution, but the agency BUDDY BONNEVIE, Respondents.
years. refused or failed to act on the matter.

"Provided, however, That the penalties herein provided shall The fact that the respondents contracts were altered or
be without prejudice to any liability which any such official The key issue that Gumabay, et al. present is whether or not
substituted at the workplace had never been denied by the the 2nd paragraph of Section 10, R.A. 8042, which holds the
may have incured under other existing laws or rules and agency. On the contrary, it admitted that the contract
regulations as a consequence of violating the provisions of corporate directors, officers, and partners of recruitment and
substitution did happen when it argued, "as to their claim for placement agencies jointly and solidarily liable for money
this paragraph." underpayment of salary, their original contract mentioned claims and damages that may be adjudged against the latter
1350 AED monthly salary, which includes allowance while in agencies, is unconstitutional.
their Appointment Letters, they were supposed to receive
1,300 AED. While there was a difference of 50 AED monthly,
the same could no longer be claimed by virtue of their In G.R. 167590 (the PASEI case), the Quezon City RTC held
Affidavits of Quitclaims and Desistance."34ςrνllςrνll as unconstitutional the last sentence of the 2nd paragraph of
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Section 10 of R.A. 8042. It pointed out that, absent sufficient The number of persons dealt with is not an essential
proof that the corporate officers and directors of the erring ingredient of the act of recruitment and placement of
company had knowledge of and allowed the illegal workers. Any of the acts mentioned in the basic rule in Article
recruitment, making them automatically liable would violate The basic issue in this case is the correct interpretation of 13(b) win constitute recruitment and placement even if only
their right to due process of law. Article 13(b) of P.D. 442, otherwise known as the Labor one prospective worker is involved. The proviso merely lays
Code, reading as follows: down a rule of evidence that where a fee is collected in
consideration of a promise or offer of employment to two or
But the Court has already held, pending adjudication of this
(b) Recruitment and placement' refers to more prospective workers, the individual or entity dealing
case, that the liability of corporate directors and officers is
any act of canvassing, enlisting, with them shall be deemed to be engaged in the act of
not automatic.
contracting, transporting, hiring, or recruitment and placement. The words "shall be deemed"
procuring workers, and includes create that presumption.
To make them jointly and solidarily liable with their referrals, contract services, promising or
company, there must be a finding that they were remiss advertising for employment, locally or e. Simple illegal recruitment
in directing the affairs of that company, such as abroad, whether for profit or not:
sponsoring or tolerating the conduct of illegal Provided, That any person or entity f. Illegal recruitment involving economic
activities.19 which, in any manner, offers or sabotage
promises for a fee employment to two
or more persons shall be deemed
In the case of Becmen and White Falcon,20 while there is
engaged in recruitment and
evidence that these companies were at fault in not
placement.
investigating the cause of Jasmin’s death, there is no
mention of any evidence in the case against them that
intervenors Gumabay, et al., Becmen’s corporate officers The view of the private respondents is that to constitute
[ GR No. 214340, Jul 19, 2017 ]
and directors, were personally involved in their company’s recruitment and placement, all the acts mentioned in this
particular actions or omissions in Jasmin’s case. article should involve dealings with two or m•re persons as
an indispensable requirement.
PEOPLE v. GILDA ABELLANOSA
As a final note, R.A. 8042 is a police power measure
intended to regulate the recruitment and deployment of On the other hand, the petitioner argues that the requirement
OFWs. It aims to curb, if not eliminate, the injustices and of two or more persons is imposed only where the
abuses suffered by numerous OFWs seeking to work recruitment and placement consists of an offer or promise of
abroad. employment to such persons and always in consideration of
a fee. The other acts mentioned in the body of the article Illegal recruitment x x x is deemed committed in large scale if
The rule is settled that every statute has in its favor the may involve even only one person and are not necessarily committed against three or more persons individually or as a
presumption of constitutionality. The Court cannot inquire for profit. group.
into the wisdom or expediency of the laws enacted by the We agree with the trial court and the CA that the prosecution
Legislative Department. Hence, in the absence of a clear Neither interpretation is acceptable. We fail to see why the was able to establish that appellant was engaged in illegal
and unmistakable case that the statute is unconstitutional, proviso should speak only of an offer or promise of recruitment in large scale. It was proved that appellant was a
the Court must uphold its validity. employment if the purpose was to apply the requirement of non-licensee or non-holder of authority to recruit workers for
two or more persons to all the acts mentioned in the basic deployment abroad; she offered or promised employment
rule. For its part, the petitioner does not explain why dealings abroad to private complainants; she received monies from
with two or more persons are needed where the recruitment private complainants purportedly as placement or processing
d. Elements and placement consists of an offer or promise of fees; that private complainants were not actually deployed to
employment but not when it is done through "canvassing, Brunei; that despite demands, appellant failed to reimburse or
enlisting, contracting, transporting, utilizing, hiring or refund to private complainants their monies; and that
procuring (of) workers. appellant committed these prohibited acts against three or
G.R. Nos. L-58674-77 July 11, 1990 more persons, individually or as a group.
PEOPLE OF THE As we see it, the proviso was intended neither to impose a
condition on the basic rule nor to provide an exception To recall, private complainants Pomar, Pastolero, Cathedral,
PHILIPPINES, petitioner,
thereto but merely to create a presumption. The Orias, Suobiron, Bueron, and Pelipog testified that appellant
vs. went to Pavia, Iloilo and represented herself as a recruiter who
HON. DOMINGO PANIS, Presiding presumption is that the individual or entity is engaged in
recruitment and placement whenever he or it is dealing could send them to Brunei for work; that appellant impressed
Judge of the Court of First Instance upon them that she had the authority or ability to send them
with two or more persons to whom, in consideration of a
of Zambales & Olongapo City, overseas for work by showing them a job order from Brunei
fee, an offer or promise of employment is made in the
Branch III and SERAPIO course of the "canvassing, enlisting, contracting, and a calling card; and appellant collected processing or
ABUG, respondents. transporting, utilizing, hiring or procuring (of) workers. " placement fees from the private complainants in various

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amounts ranging from P5,000.00 to P20,000.00; and that she In this case, Sison herself admits that she has no license or Since it was proven that the three accused were acting in
did not reimburse said amounts despite demands. authority to undertake recruitment and placement activities'. concert and conspired with one another, their illegal
The Court has held in several cases that an accused who recruitment activity is considered done by a syndicate,
In addition, it was proved that appellant does not have any represents to others that he or she could send workers making the offense illegal recruitment involving economic
license or authority to recruit workers for overseas abroad for employment, even without the authority or license sabotage.
employment as shown by the certification issued by the to do so, commits illegal recruitment.42
Philippine Overseas Employment Administration.[16]
Estafa
Finally, appellant recruited seven persons, or more than the It is the absence of the necessary license or authority to
minimum of three persons required by law, for illegal recruit and deploy workers that renders the recruitment
We affirm Sison's conviction for estafa under Article
recruitment to be considered in large scale. activity unlawful. To prove illegal recruitment, it must be
315(2)(a) of the RPC. It is settled that a person, for the same
shown that "the accused gave the complainants the distinct
acts, may be convicted separately for illegal recruitment
impression that she had the power or ability to deploy the
under RA 8042 and estafa under Article 315(2) (a) of the
complainants abroad in a manner that they were convinced
RPC.
g. Estafa to part with their money for that end."43

In People v. Daud, the Court explained:


On the other hand, illegal recruitment committed by a
syndicate, as in the present case, has the following
G.R. No. 187160 elements: In this jurisdiction, it is settled that a person who
PEOPLE OF THE commits illegal recruitment may be charged and
PHILIPPINES, Appellee, convicted separately of illegal recruitment under the
(a) the offender does not have the valid license or
vs. Labor Code and estafa under par. 2(a) of Art. 315 of the
authority required by law to engage in recruitment
ERLINDA A. SISON@ Revised Penal Code. The offense of illegal recruitment
and placement of workers;
is malum prohibitum where the criminal intent of the accused
"MARGARITA S. AGUILAR,",
is not necessary for conviction, while estafa is malum in
Appellant. (b) the offender undertakes any of the "recruitment se where the criminal intent of the accused is crucial for
and placement" activities defined in Article 13(b) of conviction.
the Labor Code, or engages in any of the
prohibited practices enumerated under now
Conviction for offenses under the Labor Code does not bar
Section 6 of RA 8042; and
conviction for offenses punishable by other laws.
Simply put, illegal recruitment is "committed by persons Conversely, conviction for estafa under par. 2(a) of Art. 315
who, without authority from the government, give the (c) the illegal recruitment is "carried out by a group of the Revised Penal Code does not bar a conviction for
impression that they have the power to send workers abroad of three or more persons conspiring and/or illegal recruitment under the Labor Code. It follows that one's
for employment purposes."40 confederating with one another in carrying out any acquittal of the crime of estafa will not necessarily result in
unlawful or illegal transaction, enterprise or his acquittal of the crime of illegal recruitment in large scale,
scheme."44 and vice versa.50 (Citations omitted)
Illegal recruitment may be undertaken by either non-license
or license holders.
In the third element, it "is not essential that there be actual
proof that all the conspirators took a direct part in every act. G.R. No. 209859
Non-license holders are liable by the simple act of It is sufficient that they acted in concert pursuant to the same EILEEN P. DAVID, Petitioner
engaging in recruitment and placement activities, while objective."45 vs.
license holders may also be held liable for committing
GLENDA S. MARQUEZ,
the acts prohibited under Section 6 of RA 8042.
The acts of Sison, Dedales, and Bacomo show a common Respondent
purpose and and each undertook a part to reach their
Under RA 8042, a non-licensee or non-holder of authority objective.
commits illegal recruitment for overseas employment in two
ways: The RTC of Manila has jurisdiction over the cases of
Their concerted action is evident in that either Sison or Illegal Recruitment and Estafa
Dedales was receiving payments from the recruits; that
(1) by any act of canvassing, enlisting, contracting, Dedales signed the acknowledgment receipt from Sison; and
transporting, utilizing, hiring, or procuring workers, and that the three accompanied their recruits together in seeking At the risk of being repetitive, Sec. 9 of RA 8042, however,
includes referring, contract services, promising or advertising out their visas in Malaysia and Indonesia. Further, the fixed an alternative venue from that provided in Section 15(a)
for employment abroad, whether for profit or not; or impression given to Castuera and other recruits was that the of the Rules of Criminal Procedure, i.e., a criminal action
three were indeed working together. arising from illegal recruitment may also be filed where the
offended party actually resides at the time of the commission
(2) by undertaking any of the acts enumerated under Section of the offense and that the court where the criminal action is
6 of RA 8042.41
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first filed shall acquire jurisdiction to the exclusion of other CORBILLA, Petitioners,
courts. 65 vs. G.R. No. 162419 July 10,
WILHILM M. HILARIO, Responden 2007
Despite the clear provision of the law, the RTC of Manila PAUL V. SANTIAGO, petitioner,
declared that it has no jurisdiction to try the cases as the vs.
illegal Recruitment and Estafa were not committed in its CF SHARP CREW MANAGEMENT,
Based on a communication sent by a certain M.K. Jin dated
territory but in Kidapawan City. 66 10 October 2002,14 the foreign principal had already chosen INC., respondent.
respondent from among the other candidates as BSN (bosun
We are, thus, one with the CA in finding that the RTC of or boatswain).
Manila committed grave abuse of discretion and in fact, a On the other hand, respondent argues that the
palpable error, in ordering the quashal of the Informations. Labor Arbiter has no jurisdiction to award petitioners
Pursuant to this communication, petitioner entered into an monetary claims. His employment with respondent did not
The express provision of the law is clear that the filing of employment contract and hired respondent on 24 October
criminal actions arising from illegal recruitment before the R commence because his deployment was withheld for a valid
2002. Subsequent communications, though, show that the reason.
TC of the province or city where the offended party actually foreign principal approved a different candidate for the
resides at the time of the commission of the offense is Consequently, the labor arbiter and/or the NLRC
position of BSN.15 cannot entertain adjudication of petitioners case much less
allowed. It goes without saying that the dismissal of the case
on a wrong ground, indeed, deprived the prosecution, as well award damages to him. The controversy involves a breach of
as the respondent as complainant, of their day in court. Thus, petitioner did not deploy respondent. contractual obligations and as such is cognizable by civil
courts.[24] On another matter, respondent claims that the
second issue posed by petitioner involves a recalibration of
Likewise, with the case of Estafa arising from such illegal The contract was already perfected on the date of its facts which is outside the jurisdiction of this Court.[25]
recruitment activities, the outright dismissal thereof due to execution, which occurred when petitioner and respondent
lack of jurisdiction was not proper, considering that as per agreed on the object and the cause, as well as on the rest of There is some merit in the petition.
the allegations in the Information, the same was within the the terms and conditions therein.
jurisdiction of Manila. During the preliminary investigation of There is no question that the parties entered into an
the cases, respondent even presented evidence that some Naturally, contemporaneous with the perfection of the employment contract on 3 February 1998, whereby petitioner
of the essential elements of the crime were committed within employment contract was the birth of certain rights and was contracted by respondent to render services on board
Manila, such as the payment of processing and/or placement obligations, a breach of which may give rise to a cause of MSV Seaspread for the consideration of US$515.00 per
fees, considering that these were deposited in certain banks action against the erring party.16 Also, the POEA Standard month for nine (9) months, plus overtime pay.
located in Manila. 68 Thus, it bears stressing that the trial Contract must be recognized and respected. Thus, neither However, respondent failed to deploy petitioner
court should have proceeded to take cognizance of the case, the manning agent nor the employer can simply prevent a from the port of Manila to Canada. Considering that petitioner
and if during the trial it was proven that the offense was seafarer from being deployed without a valid reason.17 was not able to depart from the airport or seaport in the point
committed somewhere else, that is the time that the trial of hire, the employment contract did not commence, and no
court should dismiss the case for want of employer-employee relationship was created between the
jurisdiction. 69 Undoubtedly, such erroneous outright Under the principle of equity and substantial justice, change parties.[26]
dismissal of the case is a nullity for want of due process. The of mind was not a valid reason for the non-deployment of
prosecution and the respondent as the private offended party respondent. He lost the opportunity to apply for other However, a distinction must be made between the
were not given the opportunity to present and prosecute their positions in other agencies when he signed the contract of perfection of the employment contract and the
case. Indeed, the prosecution and the private offended party employment with petitioner. Simply put, that contract was commencement of the employer-employee relationship.
are as much entitled to due process as the accused in a binding on the parties and may not later be disowned simply
criminal case. because of a change of mind of either one of them. The perfection of the contract, which in this case
coincided with the date of execution thereof, occurred when
The unilateral and unreasonable failure to deploy respondent petitioner and respondent agreed on the object and the cause,
constitutes breach of contract, which gives rise to a liability to as well as the rest of the terms and conditions therein.
2. Migrant workers pay actual damages.
The commencement of the employer-employee
a. Commencement of employer- relationship, as earlier discussed, would have taken place
employee relationship The sanctions provided for non-deployment do not end with had petitioner been actually deployed from the point of
the suspension or cancellation of license or the imposition of hire.
a fine and the return of all documents at no cost to the
worker. They do not forfend a seafarer from instituting an Thus, even before the start of any employer-
G.R. No. action for damages against the employer or agency that has employee relationship, contemporaneous with the perfection
195792 November 24, failed to deploy him of the employment contract was the birth of certain rights and
2014 obligations, the breach of which may give rise to a cause of
ABOSTA SHIP MANAGEMENT action against the erring party.
and/or ARTEMIO

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Thus, if the reverse had happened, that is the In sum, prior to R.A. No. 8042, OFWs and local workers with such limitation on the money claims of illegally terminated
seafarer failed or refused to be deployed as agreed upon, he fixed-term employment who were illegally discharged were local workers with fixed-term employment
would be liable for damages. treated alike in terms of the computation of their money
claims: they were uniformly entitled to their salaries for the
Moreover, while the POEA Standard Contract must entire unexpired portions of their contracts. But with the
be recognized and respected, neither the manning agent nor enactment of R.A. No. 8042, specifically the adoption of the
c. Liability of principal/agent; theory of
the employer can simply prevent a seafarer from being subject clause, illegally dismissed OFWs with an unexpired
imputed knowledge
deployed without a valid reason. portion of one year or more in their employment contract
have since been differently treated in that their money claims
Respondents act of preventing petitioner are subject to a 3-month cap, whereas no such limitation is
from departing the port of Manila and boarding MSV imposed on local workers with fixed-term employment.
Seaspread constitutes a breach of contract, giving rise to
petitioners cause of action. G.R. No. 214132, February 18, 2015
The Court concludes that the subject clause contains a
suspect classification in that, in the computation of the
Respondent unilaterally and unreasonably reneged
monetary benefits of fixed-term employees who are SEALANES MARINE SERVICES,
on its obligation to deploy petitioner and must therefore
illegally discharged, it imposes a 3-month cap on the
answer for the actual damages he suffered. INC./ARKLOW SHIPPING NETHERLAND
claim of OFWs with an unexpired portion of one year or
more in their contracts, but none on the claims of other AND/OR CHRISTOPHER
OFWs or local workers with fixed-term employment. The DUMATOL, Petitioners, v. ARNEL G.
b. Money claims
subject clause singles out one classification of OFWs DELA TORRE, Respondent.
and burdens it with a peculiar disadvantage.

G.R. No. 167614 March 24,


2009 Concerning the joint and solidary liability of the manning
ANTONIO M. agency, Sealanes, its foreign principal, Arklow Shipping
SERRANO, Petitioner, G.R. No. 170139 August 5, Netherland, and Sealanes’ President Dumatol, Section 10 of
vs. 2014 Republic Act (R.A.) No. 8042, otherwise known as the
Gallant MARITIME SERVICES, INC. SAMEER OVERSEAS “Migrant Workers and Overseas Filipinos Act of 1995”, as
and MARLOW NAVIGATION CO., PLACEMENT AGENCY, amended by Section 7 of R.A. No. 10022, reads:
INC., Respondents. INC., Petitioner,
The liability of the principal/employer and the
vs.
recruitment/placement agency for any and all claims under
JOY C. CABILES, Respondent.
this section shall be joint and several.
For Antonio Serrano (petitioner), a Filipino seafarer, the last
clause in the 5th paragraph of Section 10, Republic Act This provision shall be incorporated in the contract for
(R.A.) No. 8042,2 to wit: overseas employment and shall be a condition precedent for
We observe that the reinstated clause, this time as provided
in Republic Act. No. 10022, violates the constitutional rights its approval. The performance bond to [be] filed by the
Sec. 10. Money Claims. - x x x In case of to equal protection and due process.96 Petitioner as well as recruitment/placement agency, as provided by law, shall be
termination of overseas employment without just, the Solicitor General have failed to show any compelling answerable for all money claims or damages that may be
valid or authorized cause as defined by law or change in the circumstances that would warrant us to revisit awarded to the workers.
contract, the workers shall be entitled to the full the precedent.
reimbursement of his placement fee with interest If the recruitment/placement agency is a juridical being, the
of twelve percent (12%) per annum, plus his corporate officers and directors and partners as the case
A reasonable classification "(1) must rest on substantial
salaries for the unexpired portion of his may be, shall themselves be jointly and solidarily liable with
distinctions; (2) must be germane to the purposes of the law;
employment contract or for three (3) months for the corporation or partnership for the aforesaid claims and
(3) must not be limited to existing conditions only; and (4)
every year of the unexpired term, whichever is damages
must apply equally to all members of the same class."105
less.
Thus, every applicant for license to operate a seafarers’
The reinstated clause does not satisfy the requirement of manning agency shall, in the case of a corporation or
Petitioner claims that the last clause violates the OFWs'
reasonable classification. partnership, submit a written application together with,
constitutional rights in that it impairs the terms of their
contract, deprives them of equal protection and denies them among others, a verified undertaking by officers,
due process. The adoption of the reinstated clause in Republic Act No. directors and partners that they will be jointly and
8042 subjected the money claims of illegally dismissed severally liable with the company over claims arising
overseas workers with an unexpired term of at least a year to from employer-employee relationship.17
a cap of three months worth of their salary.114 There was no
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Laws are deemed incorporated in employment contracts and Placewell International Services Corporation v. While the contract stated that any extension must be made
the contracting parties need not repeat them. They do not Camote17 (Placewell). by mutual consent of the parties, it, however, incorporated
even have to be referred to. Every contract, thus, contains Department Order (DO)No. 4 and Memorandum Circular No.
not only what has been explicitly stipulated, but also the 09, both series of 2000, which provided for the Standard
In Sunace, the Court ruled that the theory of imputed
statutory provisions that have any bearing on the matter. Terms and Conditions Governing the Employment of
knowledge ascribed the knowledge of the agent to the
Filipino Seafarers on Board Ocean Going Vessels.
principal, not the other way around. The knowledge of
Sections 2 and 18 thereof provide:
the principal-foreign employer could not, therefore, be
imputed to its agent.
SECTION 2. COMMENCEMENT/ DURATION OF
G.R. No. 197303 June 4, CONTRACT
2014 As there was no substantial proof that Sunace knew of, and
consented to be bound under, the 2-year employment
APQ SHIPMANAGEMENT CO.,
contract extension, it could not be said to be privy thereto. As A. The Employment contract between the
LTD., and APQ CREW
such, it and its owner were not held solidarily liable for any of employer and the seafarer shall commence upon
MANAGEMENT USA, the complainant’s claims arising from the 2-year employment actual departure of the seafarer from the airport or
INC., Petitioners, extension.18 seaport in the point of hire and with a POEA
vs. approved contract. It shall be effective until the
ANGELITO L. seafarer’s date of arrival at the point of hire upon
CASEÑAS, Respondent. In Placewell, the Court concluded that the original POEA-
termination of his employment pursuant to Section
approved employment contract subsisted and, thus, the
18 of this Contract.
solidary liability of the agent with the principal continued. It
ruled that:
The pivotal issue for resolution is whether or not the B. The period of employment shall be for a period
employment contract of Caseñas was extended with the mutually agreed upon by the seafarer and the
R.A. No. 8042 explicitly prohibits the substitution or alteration
consent of APQ/Crew Management. employer but not to exceed 12 months. Any
to the prejudice of the worker, of employment contracts
extension of the contract shall be subject to the
already approved and verified by the Department of Labor
mutual consent of both parties.
The Court rules in the affirmative. and Employment (DOLE) from the time of actual signing
thereof by the parties up to and including the period of the
expiration of the same without the approval of the DOLE. xxx
Employment contracts of seafarers on board foreign ocean-
going vessels are not ordinary contracts.
Thus, we held in Chavez v. Bonto-Perez,19 that the SECTION 18. TERMINATION OF EMPLOYMENT
subsequently executed side agreement of an overseas
They are regulated and an imprimatur by the State is contract worker with her foreign employer which reduced her
necessary. A. The employment of the seafarer shall cease
salary below the amount approved by the POEA is void
when the seafarer completes his period of
because it is against our existing laws, morals and public
contractual service aboard the vessel, signs off
While the seafarer and his employer are governed by their policy. The said side agreement cannot supersede her
from the vessel and arrives at the point of hire.
mutual agreement, the POEA Rules and Regulations require standard employment contract approved by the POEA.
that the POEA-SEC be integrated in every seafarer’s
contract.15 In this case, there is no dispute that Caseñas’ B. The employment of the seafareris also
xxx
employment contract was duly approved by the POEA and terminated when the seafarer arrives at the point
that it incorporated the provisions of the POEA-SEC. of hire for any of the following reasons:
Moreover, we find that there was no proper dismissal of
respondent by SAAD; the "termination" of respondent was
As earlier stated, the controversy started when Caseñas 1. When the seafarer signs off and is
clearly a ploy to pressure him to agree to a lower wage rate
claimed sickness and disability benefits as well as unpaid disembarked for medical reasons
for continued employment. Thus, the original POEA-
wages from the petitioners upon his return to the Philippines. pursuant to Section 20 (B)[5] of this
approved employment contract of respondent subsists
Contract.
despite the so-called new agreement with SAAD.
The petitioners, on the other hand, refused to pay, arguing
that Caseñas’ sickness was contracted after his employment Consequently, the solidary liability of petitioner with SAAD
xxx
contract expired. for respondent’s money claims continues in accordance with
Section 10 of R.A. 8042.20 [Emphases supplied]
Regarding the issue of extension and its corresponding
consequences, two cases were cited by the parties in their APQ’s primary argument revolves around the fact of It is to be observed that both provisions require the seafarer
pleadings. The first was Sunace International Management expiration of Caseñas’ employment contract, which it claims to arrive at the point of hire as it signifies the completion of
Services, Inc. v. NLRC16 (Sunace)and the second was was not extended as it was without its consent. the employment contract, and not merely its expiration.

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Similarly, a seafarer’s employment contract is terminated They willfully refused to protect and tend to the welfare of the City and DIVINA A.
even before the contract expires as soon as he arrives at the deceased Jasmin, treating her case as just one of those MONTEHERMOZO,Respondents.
point of hire and signs off for medical reasons, due to unsolved crimes that is not worth wasting their time and
shipwreck, voluntary resignation or for other just causes. resources on.
Petitioner, Sunace International Management
In a nutshell, there are three (3) requirements necessary for The evidence does not even show that Becmen and Rajab Services (Sunace), a corporation duly organized and existing
the complete termination of the employment contract: lifted a finger to provide legal representation and seek an under the laws of the Philippines, deployed to Taiwan Divina
investigation of Jasmin’s case. A. Montehermozo (Divina) as a domestic helper under a 12-
month contract effective February 1, 1997.[1] The deployment
(1) termination due to expiration or other was with the assistance of a Taiwanese broker, Edmund
reasons/causes; Worst of all, they unnecessarily trampled upon the person Wang, President of Jet Crown International Co., Ltd.
(2) signing off from the vessel; and and dignity of Jasmin by standing pat on the argument that
(3) arrival at the point of hire. Jasmin committed suicide, which is a grave accusation given
its un-Christian nature. The theory of imputed knowledge ascribes the knowledge of
In this case, there was no clear showing that Caseñas the agent, Sunace, to the principal, employer Xiong, not the
signed off from the vessel upon the expiration of his Private employment agencies are held jointly and severally other way around.[23] The knowledge of the principal-foreign
employment contract, which was in February or April 2005. liable with the foreign-based employer for any violation of the employer cannot, therefore, be imputed to its agent Sunace.
He did not arrive either in Manila, his point of hire, because recruitment agreement or contract of employment.
he was still on board the vessel MV Haitien Pride on the There being no substantial proof that Sunace knew
supposed date of expiration of his contract. It was only on of and consented to be bound under the 2-year employment
This joint and solidary liability imposed by law against contract extension, it cannot be said to be privy thereto.
August 14, 2006 that he signed off21 from MV Haitien Pride
recruitment agencies and foreign employers is meant to
and arrived in Manila on August 30, 2006.
assure the aggrieved worker of immediate and sufficient
payment of what is due him.37 3. Employment of foreign nationals

If the recruitment/placement agency is a juridical being, Title II


the corporate officers and directors and partners as the EMPLOYMENT OF NON-RESIDENT ALIENS
G.R. Nos. 182978-79 April case may be, shall themselves be jointly and solidarily
7, 2009 liable with the corporation or partnership for the
aforesaid claims and damages.38 Article 40. Employment permit of non-resident aliens. Any
BECMEN SERVICE EXPORTER
alien seeking admission to the Philippines for employment
AND PROMOTION, purposes and any domestic or foreign employer who desires
INC., Petitioner, White Falcon’s assumption of Becmen’s liability does not to engage an alien for employment in the Philippines shall
vs. automatically result in Becmen’s freedom or release from obtain an employment permit from the Department of
SPOUSES SIMPLICIO and MILA liability. This has been ruled in ABD Overseas Manpower Labor.
CUARESMA (for and in behalf of Corporation v. NLRC.39 Instead, both Becmen and White
their daughter, Jasmin G. Falcon should be held liable solidarily, without prejudice to
each having the right to be reimbursed under the provision of The employment permit may be issued to a non-resident
Cuaresma), WHITE FALCON alien or to the applicant employer after a determination of
SERVICES, INC. and JAIME ORTIZ the Civil Code that whoever pays for another may demand
from the debtor what he has paid.40 the non-availability of a person in the Philippines who is
(President,White Falcon Services, competent, able and willing at the time of application to
Inc.), Respondents. perform the services for which the alien is desired.

G.R. No. 161757 January


For an enterprise registered in preferred areas of
25, 2006
Becmen and White Falcon, as licensed local recruitment investments, said employment permit may be issued upon
SUNACE INTERNATIONAL
agencies, miserably failed to abide by the provisions of R.A. recommendation of the government agency charged with the
8042. MANAGEMENT SERVICES, supervision of said registered enterprise.
INC.Petitioner
,
Recruitment agencies are expected to extend assistance to vs.
their deployed OFWs, especially those in distress. Instead,
they abandoned Jasmin’s case and allowed it to remain
NATIONAL LABOR RELATIONS Article 41. Prohibition against transfer of employment.
unsolved to further their interests and avoid anticipated
COMMISSION, Second Division;
liability which parents or relatives of Jasmin would certainly
exact from them. HON. ERNESTO S. DINOPOL, in After the issuance of an employment permit, the alien shall
his capacity as Labor Arbiter, NLRC; not transfer to another job or change his employer
NCR, Arbitration Branch, Quezon without prior approval of the Secretary of Labor.

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Any non-resident alien who shall take up employment in
violation of the provision of this Title and its implementing
rules and regulations shall be punished in accordance with
the provisions of Articles 289 and 290 of the Labor Code.

In addition, the alien worker shall be subject to deportation


after service of his sentence.

Article 42. Submission of list. Any employer employing non-


resident foreign nationals on the effective date of this Code
shall submit a list of such nationals to the Secretary of Labor
within thirty (30) days after such date indicating their names,
citizenship, foreign and local addresses, nature of
employment and status of stay in the country. The Secretary
of Labor shall then determine if they are entitled to an
employment permit.

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C. Apprentice, Learner, Disabled Workers ARTICLE 62. Signing of Apprenticeship Agreement. — ARTICLE 65. Investigation of Violation of Apprenticeship
Every apprenticeship agreement shall be signed by the Agreement. — Upon complaint of any interested person or
employer or his agent, or by an authorized representative upon its own initiative, the appropriate agency of the
ARTICLE 58. Definition of Terms. 59 — As used in this Title: of any of the recognized organizations, associations or Department of Labor and Employment or its authorized
groups and by the apprentice. representative shall investigate any violation of an
(a) "Apprenticeship" means practical training on
apprenticeship agreement pursuant to such rules and
the job supplemented by related theoretical An apprenticeship agreement with a minor shall be signed
instruction. regulations as may be prescribed by the Secretary of
in his behalf by his parent or guardian or, if the latter is not Labor and Employment.
(b) An "apprentice" is a worker who is covered by available, by an authorized representative of the
a written apprenticeship agreement with an Department of Labor, and the same shall be binding ARTICLE 66. Appeal to the Secretary of Labor and
individual employer or any of the entities during its lifetime. Employment. — The decision of the authorized agency of
recognized under this Chapter. the Department of Labor and Employment may be
Every apprenticeship agreement entered into under this appealed by any aggrieved person to the Secretary of
(c) An "apprenticeable occupation" means any Title shall be ratified by the appropriate apprenticeship Labor and Employment within ve (5) days from receipt of
trade, form of employment or occupation committees, if any, and a copy thereof shall be furnished the decision. The decision of the Secretary of Labor and
which requires more than three (3) months of both the employer and the apprentice.
practical training on the job supplemented by Employment shall be final and executory. ITAaHc
related theoretical instruction. ASEcHI ARTICLE 63. Venue of Apprenticeship Programs. — Any ARTICLE 67. Exhaustion of Administrative Remedies. —
employer, group or association, industry organization or No person shall institute any action for the enforcement of
(d) "Apprenticeship agreement" is an employment
contract wherein the employer binds himself to civic group wishing to organize an apprenticeship program any apprenticeship agreement or damages for breach of
train the apprentice and the apprentice in turn may choose from any of the following apprenticeship any such agreement, unless he has exhausted all
accepts the terms of training. schemes as the training venue for apprentice: available administrative remedies.

ARTICLE 59. Qualifications of Apprentice. — To (a) Apprenticeship conducted entirely by and ARTICLE 68. Aptitude Testing of Applicants. —
qualify as an apprentice, a person shall: within the sponsoring firm, establishment or Consonant with the minimum quali cations of
entity; apprenticeapplicants required under this Chapter,
(a) Be at least fourteen (14) years of age; 60 employers or entities with duly recognized apprenticeship
(b) Apprenticeship entirely within a Department
of Labor and Employment training center or programs shall have primary responsibility for providing
(b) Possess vocational aptitude and capacity for
other public appropriate aptitude tests in the selection of apprentices. If
appropriate tests; and
training institution; or they do not have adequate facilities for the purpose, the
(c) Possess the ability to comprehend and follow Department of Labor and Employment shall perform the
oral and written instructions. (c) Initial training in trade fundamentals in a service free of charge.
training center or other institution with
Trade and industry associations may recommend to the subsequent actual work participation within ARTICLE 69. Responsibility for Theoretical Instruction. —
Secretary of Labor appropriate educational requirements the sponsoring firm or entity during the final Supplementary theoretical instruction to apprentices in
for different occupations. stage of training. cases where the program is undertaken in the plant may
ARTICLE 64. Sponsoring of Apprenticeship Program. — be done by the employer. If the latter is not prepared to
ARTICLE 60. Employment of Apprentices. 61 — Only assume the responsibility, the same may be delegated to
Any of the apprenticeship schemes recognized herein
employers in the highly technical industries may employ an appropriate government agency.
may be undertaken or sponsored by a single employer or
apprentices and only in apprenticeable occupations
or by a group or association thereof or by a civic
approved by the Minister of Labor and Employment. ARTICLE 70. Voluntary Organization of Apprenticeship
organization. Actual training of apprentices may be
Programs; Exemptions. —
ARTICLE 61. Contents of Apprenticeship Agreements. 62 undertaken:
— Apprenticeship agreements, including wage rates of (a) The organization of apprenticeship program
apprentices, shall conform to the rules issued by the (a) In the premises of the sponsoring employer in
shall be primarily a voluntary undertaking by employers;
the case of individual apprenticeship
Minister of Labor and Employment. The period of programs;
apprenticeship shall not exceed six months. (b) When national security or particular
(b) In the premises of one or several designated requirements of economic development so demand, the
Apprenticeship agreements providing for wage rates rms in the case of programs sponsored by a President of the Philippines may require compulsory
below the legal minimum wage, which in no case shall group or association of employers or by a civic training of apprentices in certain trades, occupations, jobs
start below 75 per cent of the applicable minimum wage, organization; or or employment levels where shortage of trained manpower
may be entered into only in accordance with is deemed critical as determined by the Secretary of Labor
(c) In a Department of Labor and Employment and Employment. Appropriate rules in this connection shall
apprenticeship programs duly approved by the Minister of be promulgated by the Secretary of Labor and Employment
Labor and Employment. The Ministry shall develop training center or other public training
institution. as the need arises; and
standard model programs of apprenticeship.
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(c) Where services of foreign technicians The wages or salary rates of the learners which shall begin The employment agreement shall be subject to inspection by
are utilized by private companies in apprenticeable trades, at not less than seventy-five percent (75%) of the applicable the Secretary of Labor or his duly authorized representative.
said companies are required to set up appropriate minimum wage; and
apprenticeship programs.
Article 81. Eligibility for apprenticeship. Subject to the
A commitment to employ the learners if they so desire, as appropriate provisions of this Code, handicapped workers
ARTICLE 71. Deductibility of Training regular employees upon completion of the learnership. may be hired as apprentices or learners if their handicap is
Costs. — An additional deduction from taxable income of not such as to effectively impede the performance of job
one-half (1/2) of the value of labor training expenses operations in the particular occupations for which they are
All learners who have been allowed or suffered to work
incurred for developing the productivity and ef ciency of hired.
during the first two (2) months shall be deemed regular
apprentices shall be granted to the person or enterprise employees if training is terminated by the employer before
organizing an apprenticeship program: the end of the stipulated period through no fault of the
Provided, That such program is duly recognized by learners.
RA 7277. MAGNA CARTA FOR
the Department of Labor and Employment: Provided, further, PERSONS WITH DISABILITY
That such deduction shall not exceed ten (10%) percent of The learnership agreement shall be subject to inspection by
direct labor wage: and Provided, finally, That the person or the Secretary of Labor and Employment or his duly
enterprise who wishes to avail himself or itself of this authorized representative.
incentive should pay his apprentices the minimum wage.
SECTION 4. Definition of Terms For purposes of this Act,
Article 76. Learners in piecework. Learners employed in these terms are defined as follows:
piece or incentive-rate jobs during the training period shall be
ARTICLE 72. Apprentices without Compensation. — The (a). Disabled Persons are those suffering from restriction of
paid in full for the work done.
Secretary of Labor and Employment may authorize the different abilities, as a result of a mental, physical or sensory
hiring of apprentices without compensation whose training impairment, to perform an activity in the manner or within the
on the job is required by the school or training program Article 77. Penalty clause. Any violation of this Chapter or its range considered normal for a human being;
curriculum or as requisite for graduation or board implementing rules and regulations shall be subject to the
examination. general penalty clause provided for in this Code. (b). Impairment is any loss, diminution or aberration of
psychological, physiological, or anatomical structure of
Chapter III function;
HANDICAPPED WORKERS
(c). Disability shall mean
Chapter II (1) a physical or mental impairment that substantially
LEARNERS Article 78. Definition. Handicapped workers are those limits one or more psychological, physiological or
whose earning capacity is impaired by age or physical or anatomical function of an individual or activities of such
mental deficiency or injury. individual;
Article 73. Learners defined. Learners are persons hired as (2) a record of such an impairment; or
trainees in semi-skilled and other industrial occupations (3) being regarded as having such an impairment;
which are non-apprenticeable and which may be learned Article 79. When employable. Handicapped workers may be
through practical training on the job in a relatively short employed when their employment is necessary to prevent
curtailment of employment opportunities and when it does (d). Handicap refers to a disadvantage for a given
period of time which shall not exceed three (3) months. individual resulting from an impairment or a disability, that
not create unfair competition in labor costs or impair or lower
working standards. limits or prevents the functions or activity, that is considered
Article 74. When learners may be hired. Learners may be normal given the age and sex of the individual;
employed when no experienced workers are available, the
employment of learners is necessary to prevent curtailment Article 80. Employment agreement. Any employer who (e). Rehabilitation is an integrated approach to physical,
of employment opportunities, and the employment does not employs handicapped workers shall enter into an social, cultural, spiritual, educational and vocational
create unfair competition in terms of labor costs or impair or employment agreement with them, which agreement shall measures that create conditions for the individual to attain
lower working standards. include: the highest possible level of functional ability;

(1) The names and addresses of the handicapped workers (f). Social Barriers refer to the characteristics of
Article 75. Learnership agreement. Any employer desiring to institutions, whether legal, economic, cultural, recreational or
employ learners shall enter into a learnership agreement to be employed;
(2) The rate to be paid the handicapped workers which other, any human group, community, or society which limit
with them, which agreement shall include: the fullest possible participation of disabled persons in the
shall not be less than seventy five (75%) percent of the
applicable legal minimum wage; life of the group. Social barriers include negative attitudes
The names and addresses of the learners; (3) The duration of employment period; and which tends to single out and exclude disabled persons and
(4) The work to be performed by handicapped workers. which distort roles and interpersonal relationship;

The duration of the learnership period, which shall not (g). Auxiliary Aids and Services include:
exceed three (3) months;
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1) qualified interpreters or other effective methods of determining whether an action is readily achievable, factors eligible as apprentices or learners; Provided, That their
delivering materials to individuals with hearing to be considered include handicap is not much as to effectively impede the
impairments; performance of job operations in the particular occupation for
2) qualified readers, taped tests, or other effective 1) the nature and cost of the action; which they are hired; Provided, further, That after the lapse
methods of delivering materials to individuals with visual of the period of apprenticeship if found satisfactory in the job
impairments; performance, they shall be eligible for employment.
3) acquisition or modification of equipment or devices; 2) the overall financial resources of the facility or
and facilities involved in the action; the number of persons TITLE THREE PROHIBITION ON DISCRIMINATION
4) other similar services and actions or all types of aids employed at such facility; the effect on expenses and AGAINST DISABLED PERSONS
and services that facilitate the learning process of CHAPTER 1 Discrimination on Employment
people with mental disability; resources, or the impact otherwise of such action upon
the operation of the facility; SECTION 32. Discrimination on Employment No entity,
(h). Reasonable Accommodation include whether public or private, shall discriminate against a
3) the overall financial resources of the covered entity qualified disabled person by reason of disability in regard to
(1) improvement of existing facilities used by employees with respect to the number of its employees; the job application procedures, the hiring, promotion, or
in order to render these readily accessible to and number, type and location of its facilities; and discharge of employees, employee compensation, job
usable by disabled persons; and training, and other terms, conditions, and privileges of
employment. The following constitute acts of discrimination:
4) the type of operation or operations of the covered
(2) modification of work schedules, reassignment to a
entity, including the composition, structure and
vacant position, acquisition or modification of equipment (a). Limiting, segregating or classifying a disabled job
functions of the work force of such entity; the
or devices, appropriate adjustments or modifications of applicant in such a manner that adversely affects his
geographic
examinations, training materials or company policies, work opportunities;
rules and regulations, the provisions of auxiliary aids
and services, and other similar accommodations for separateness, administrative or fiscal relationship of the (b). Using qualification standards, employment tests or
disabled persons; facilities in question to the covered entity; other selection criteria that screen out or tend to screen
out a disabled person unless such standards, tests or
(i). Sheltered Employment refers to the provision of (n). Public Transportation means transportation by air, land other selection criteria are shown to be jobrelated for
productive work for disabled persons through workshop and sea that provides the public with general or special the position on question and are consistent with
providing special facilities, income producing projects or service on a regular and continuing basis; business necessity;
homework schemes with a view to given them the
opportunity to earn a living thus enabling them to acquire a (o). Covered entity means employer, employment agency, (c). Utilizing standards, criteria, or methods of
working capacity required in open industry. labor organization or joint labor-management committee; and administration that:
1). have the effect of discrimination on the
(j). Auxiliary Social Services are the supportive activities in (p). Commerce shall be taken to mean a s travel, trade, basis of disability; or
the delivery of social services to the marginalized sectors of traffic, commerce, transportation, or communication among 2). perpetuate the discrimination of others
society; the provinces or between any foreign country or any territory who are subject to common administrative
or possession and any province. control;
(k). Marginalized Disabled Persons refer to disabled persons (d). Providing less compensation, such as salary, wage
who lack access to rehabilitative services and opportunities TITLE TWO RIGHTS AND PRIVILEGES OF DISABLED or other forms of remuneration and fringe benefits, to a
to be able to participate fully in socioeconomic activities and PERSONS qualified disabled employee, by reason of his disability,
who have no means of livelihood or whose incomes fall CHAPTER I – Employment than the amount to which a non-disabled person
below poverty threshold; performing the same work is entitled;
SECTION 5. Equal Opportunity for Employment No
(l). Qualified Individual with a Disability shall mean an disabled (e). Favoring a non-disabled employee over a qualified
individual with a disability who, with or without reasonable persons shall be denied access to opportunities for suitable disabled employee with respect to promotion, training
accommodations, can perform the essential functions of the employment. A qualified disabled employee shall be subject opportunities, study and scholarship grants, solely on
employment position that such individual holds or desires. to the same terms and conditions of employment and the account of the latter’s disability;
However, consideration shall be given to the employer’s same compensation, privileges, benefits, fringe benefits,
judgement as to what functions of a job are essential, and if incentives or allowances as a qualified able-bodied person. (f). Re-assigning or transferring a disabled employee to a job
an employer has prepared a written description before Five percent (5%) of all casual, emergency and contractual or position he cannot perform by reason of his disability;
advertising or interviewing applicants for the job, this positions in the Department of Social Welfare and
description shall be considered evidence of the essential Development; Health; Education, Culture and Sports; and (g). Dismissing or terminating the services of a disabled
functions of the job; other government agencies, offices or corporations engaged employee by reason of his disability unless the employer can
in social development shall be reserved for disabled prove that he impairs the satisfactory performance of the
(m). Readily Achievable means a goal can be easily attained persons. work involve to the prejudice of the business entities;
and carried out without much difficulty or expense. In Provided, however, That the employer first sought provide
SECTION 7. Apprenticeship Subject to the provision of reasonable accommodations for disabled persons;
the Labor Code as amended, disabled persons shall be
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television or other forms of media is SECTION 4. Definition of Terms. — As used in this Act:
(h). Failing to select or administer in the effective manner essential:
employment tests which accurately reflect the skills, aptitude
or other factor of the disabled applicant or employee that
such test purports to measure, rather than the impaired
Provided, That the employment a) “Skill” shall mean the acquired and practiced ability to
contract is concluded by the child's carry out a task or job;
sensory, manual or speaking skills of such applicant or
parents or legal guardian, with the
employee, if any; and
express agreement of the child
(i). Excluding disabled persons from membership in labor
concerned, if possible, and the b) “Skills Development” shall mean the process through
approval of the Department of which learners and workers are systematically provided
unions or similar organization.
Labor and Employment: with learning opportunities to acquire or upgrade, or
both, their ability, knowledge and behavior pattern
required as qualifications for a job or range of jobs in a
Provided, further, That
given occupational area;
the following
RA 7610 as amended by R.A. No. 9231 requirements in all
instances are strictly c) “Technical Education” shall refer to the education
complied with: process designed at post-secondary and lower tertiary
AN ACT PROVIDING FOR STRONGER levels, officially recognized as non-degree programs
DETERRENCE AND SPECIAL "(a) The employer shall ensure the aimed at preparing technicians, para-professionals and
PROTECTION AGAINST CHILD ABUSE, protection, health, safety, morals other categories of middle-level workers by providing
EXPLOITATION AND and normal development of the them with a broad range of general education,
DISCRIMINATION, AND FOR OTHER child; theoretical, scientific and technological studies, and
PURPOSES related job skills training;
"(b) The employer shall institute
measures to prevent the child's d) “Trade” shall mean any group of interrelated jobs or any
exploitation or discrimination taking occupation which is traditionally or officially recognized
Section 2. Section 12 of the same Act, as amended, is into account the system and level
hereby further amended to read as follows: as craft or artisan in nature requiring specific
of remuneration, and the duration qualifications that can be acquired through work
and arrangement of working time; experience and/or training;
"Sec. 2. Employment of Children - Children below and
fifteen (15) years of age shall not be employed except:
"(c) The employer shall formulate
e) “Middle-Level Manpower” refers to those :
"1) When a child works directly under the sole and implement, subject to the
responsibility of his/her parents or legal approval and supervision of 1) who have acquired practical skills and knowledge
guardian and where only members of his/her competent authorities, a continuing through formal or non-formal education and training
family are employed: program for training and skills equivalent to at least a secondary education but
acquisition of the child. preferably a post-secondary education with a
Provided, however, That his/her corresponding degree or diploma; or
employment neither endangers "In the above-exceptional cases where any
his/her life, safety, health, and such child may be employed, the employer
morals, nor impairs his/her normal
development:
shall first secure, before engaging such child,
a work permit from the Department of Labor
2) skilled workers who have become highly
competent in their trade or craft as attested by industry.
and Employment which shall ensure
observance of the above requirements.
Provided, further, That
the parent or legal f) “Private Enterprises” refers to an economic system
guardian shall provide "For purposes of this Article, the term "child" under which property of all kinds can be privately owned and
the said child with the shall apply to all persons under eighteen (18) in which individuals, alone or in association with another, can
prescribed primary years of age." embark on a business activity. This includes industrial,
and/or secondary agricultural, or agro-industrial establishments engaged in the
education; or production, manufacturing, processing, repacking or
assembly of goods including service-oriented enterprises;
R.A. No 7796 (TESDA Act of 1994)
"2) Where a child's employment or
participation in public entertainment or
information through cinema, theater, radio,
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g) “Trainers” shall mean persons who direct the
and in the production plant. In-school training provides the
trainee the theoretical foundation, basic training, guidance
ART. 61. Contents of apprenticeship agreements. —
Apprenticeship agreements, including the wage rates of
practice of skills towards immediate improvement in some apprentices, shall conform to the rules issued by the Minister
and human formation, while in-plant training develops his
task; of Labor and Employment. The period of apprenticeship shall
skills and proficiency in actual work conditions as it continues
to inculcate personal discipline and work values; not exceed six months.
h) “Trainors/trainers” shall mean persons who
provide training to trainers aimed at developing the latter’s
capacities for imparting attitudes, knowledge, skills and
q) “Levy Grant System” refers to a legal contribution Apprenticeship agreements providing for wage rates
below the legal minimum wage, which in no case shall
from participating employers who would be beneficiaries of
behavior patterns required for specific jobs, tasks, start below 75 percent of the applicable minimum wage,
the program (often as a percentage of the payroll) which is
occupations or group of related occupations; may be entered into only in accordance with
subsequently turned over or rebated to enterprises offering
apprenticeship programs duly approved by the Minister
employee training programs.
i) “Trainees” shall mean persons who are
of Labor and Employment. The Ministry shall develop
standard model programs of apprenticeship. (Emphasis
participants in a vocational, administrative or technical 1. Definition supplied)
training program for the purpose of acquiring and developing 2. Qualifications
job-related skills;
3. Minimum employable age In Nitto Enterprises v. National Labor Relations
4. Period of engagement Commission,13 the Court cited Article 61 of the Labor Code
j) “Apprenticeship” training within employment with
5. Requirement/effect of an invalid agreement
and held that an apprenticeship program should first be
compulsory related theoretical instructions involving a approved by the DOLE before an apprentice may be hired,
contract between an apprentice and an employer on an otherwise the person hired will be considered a regular
approved apprenticeable occupation; employee. The Court held:
chanroblespublishingcompany
In the case at bench, the apprenticeship agreement between
k) “Apprentice” is a person undergoing training for an petitioner and private respondent was executed on May 28,
1990 allegedly employing the latter as an apprentice in the
approved apprenticeable occupation during an established
trade of "care maker/molder."
period assured by an apprenticeship agreement; G.R. No. 152894 August 17,
2007
l) “Apprenticeship Agreement” is a contract wherein CENTURY CANNING On the same date, an apprenticeship program was prepared
by petitioner and submitted to the Department of Labor and
a prospective employer binds himself to train the apprentice CORPORATION, Petitioner,
Employment. However, the apprenticeship agreement
who in turn accepts the terms of training for a recognized vs. was filed only on June 7, 1990.
apprenticeable occupation emphasizing the rights, duties COURT OF APPEALS and GLORIA C.
and responsibilities of each party; PALAD, Respondents.
Notwithstanding the absence of approval by the Department
of Labor and Employment, the apprenticeship agreement
m) “Apprenticeable Occupation” is an occupation was enforced the day it was signed.
officially endorsed by a tripartite body and approved for Registration and Approval by the TESDA of
apprenticeship by the Authority; Apprenticeship Program Required Before Hiring of
Based on the evidence before us, petitioner did not comply
Apprentices
with the requirements of the law. It is mandated that
n) “Learners” refer to persons hired as trainees in
The Labor Code defines an apprentice as a worker who is
apprenticeship agreements entered into by the employer
and apprentice shall be entered only in accordance with
semi-skilled and other industrial occupations which are non-
apprenticeable. Learnership programs must be approved by covered by a written apprenticeship agreement with an the apprenticeship program duly approved by the
the Authority. employer.11 One of the objectives of Title II (Training and Minister of Labor and Employment.
Employment of Special Workers) of the Labor Code is to
establish apprenticeship standards for the protection of
o) “User-Led” or “Market-Driven Strategy” refers to a apprentices.12 In line with this objective, Articles 60 and 61 of Prior approval by the Department of Labor and
Employment of the proposed apprenticeship program is,
strategy which promotes strengthened linkages between the Labor Code provide:
therefore, a condition sine qua non before an
educational/training institutions and industry to ensure that apprenticeship agreement can be validly entered into.
appropriate skills and knowledge are provided by the ART. 60. Employment of apprentices. — Only employers in
educational system; the highly technical industries may employ apprentices
The act of filing the proposed apprenticeship program with
and only in apprenticeable occupations approved by the
the Department of Labor and Employment is a preliminary
p) “Dual System/Training” refers to a delivery of
Minister of Labor and Employment. (Emphasis supplied)
step towards its final approval and does not instantaneously
quality technical and vocational education which requires give rise to an employer-apprentice relationship.
training to be carried out alternatively in two venues: In school
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Article 57 of the Labor Code provides that the State aims to the NLRC relied upon and, for Sebolino and Sagun, the
"establish a national apprenticeship program through the production and work schedule for March 7 to 12, 200545 cited
participation of employers, workers and government and by the CA.
non-government agencies" and "to establish apprenticeship
standards for the protection of apprentices." To translate
Third. The fact that Costales, Almoite, Sebolino and Sagun
such objectives into existence, prior approval of the DOLE to
were already rendering service to the company when they
any apprenticeship program has to be secured as a
were made to undergo apprenticeship (as established by the
condition sine qua non before any such apprenticeship
evidence) renders the apprenticeship agreements irrelevant
agreement can be fully enforced. The role of the DOLE in
as far as the four are concerned.
apprenticeship programs and agreements cannot be
debased.
This reality is highlighted by the CA finding that the
respondents occupied positions such as machine operator,
Hence, since the apprenticeship agreement between
scaleman and extruder operator - tasks that are usually
petitioner and private respondent has no force and
necessary and desirable in Atlanta’s usual business or trade
effect in the absence of a valid apprenticeship program
as manufacturer of plastic building materials.57
duly approved by the DOLE, private respondent’s
assertion that he was hired not as an apprentice but as a
delivery boy ("kargador" or "pahinante") deserves These tasks and their nature characterized the four as
credence. regular employees under Article 280 of the Labor Code.
Thus, when they were dismissed without just or authorized
cause, without notice, and without the opportunity to be
He should rightly be considered as a regular employee
heard, their dismissal was illegal under the law.58
of petitioner as defined by Article 280 of the Labor Code
x x x. (Emphasis supplied
Even if we recognize the company’s need to train its
employees through apprenticeship, we can only
consider the first apprenticeship agreement for the
G.R. No. 187320 January 26, purpose. With the expiration of the first agreement and
2011 the retention of the employees, Atlanta had, to all intents
ATLANTA INDUSTRIES, INC. and/or and purposes, recognized the completion of their
ROBERT CHAN, Petitioners, training and their acquisition of a regular employee
vs. status.
APRILITO R. SEBOLINO, KHIM V.
COSTALES, ALVIN V. ALMOITE, and To foist upon them the second apprenticeship agreement for
JOSEPH S. SAGUN, Respondents. a second skill which was not even mentioned in the
agreement itself,59 is a violation of the Labor Code’s
implementing rules60 and is an act manifestly unfair to the
We find no merit in the petition. The CA committed no employees, to say the least. This we cannot allow.
reversible error in nullifying the NLRC decision42 and in
affirming the labor arbiter’s ruling,43 as it applies to Costales,
Almoite, Sebolino and Sagun. Specifically, the CA correctly
ruled that the four were illegally dismissed because (1) they
were already employees when they were required to
undergo apprenticeship and (2) apprenticeship agreements
were invalid.

The following considerations support the CA ruling.

First. Based on company operations at the time material to


the case, Costales, Almoite, Sebolino and Sagun were
already rendering service to the company as employees
before they were made to undergo apprenticeship. The
company itself recognized the respondents’ status through
relevant operational records – in the case of Costales and
Almoite, the CPS monthly report for December 200344 which
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D. Conditions of employment For purposes of this Article, "health personnel" shall include (1) When the country is at war or when any other national
resident physicians, nurses, nutritionists, dietitians, or local emergency has been declared by the National
pharmacists, social workers, laboratory technicians, Assembly or the Chief Executive;
BOOK THREE paramedical technicians, psychologists, midwives, (2) When it is necessary to prevent loss of life or property
CONDITIONS OF EMPLOYMENT attendants and all other hospital or clinic personnel. or in case of imminent danger to public safety due to an
actual or impending emergency in the locality caused
Title I by serious accidents, fire, flood, typhoon, earthquake,
Article 84. Hours worked. Hours worked shall include
WORKING CONDITIONS AND REST PERIODS epidemic, or other disaster or calamity;
(3) When there is urgent work to be performed on
(a) all time during which an employee is required to be on machines, installations, or equipment, in order to avoid
Chapter I duty or to be at a prescribed workplace; and serious loss or damage to the employer or some other
HOURS OF WORK cause of similar nature;
(4) When the work is necessary to prevent loss or damage
(b) all time during which an employee is suffered or to perishable goods; and
Article 82. Coverage. The provisions of this Title shall apply permitted to work.
to employees in all establishments and undertakings whether (5) Where the completion or continuation of the work
for profit or not, but not to: started before the eighth hour is necessary to prevent
Rest periods of short duration during working hours shall be serious obstruction or prejudice to the business or
counted as hours worked. operations of the employer.
(1) government employees, (6) Any employee required to render overtime work under
(2) managerial employees, this Article shall be paid the additional compensation
(3) field personnel, Article 85. Meal periods. Subject to such regulations as the required in this Chapter.
(4) members of the family of the employer who are Secretary of Labor may prescribe, it shall be the duty of
dependent on him for support, every employer to give his employees not less than sixty (60)
(5) domestic helpers, minutes time-off for their regular meals. Article 90. Computation of additional compensation. For
(6) persons in the personal service of another, purposes of computing overtime and other additional
(7) and workers who are paid by results as determined by remuneration as required by this Chapter, the "regular wage"
Article 86. Night shift differential. Every employee shall be of an employee shall include the cash wage only, without
the Secretary of Labor in appropriate regulations.
paid a night shift differential of not less than ten percent deduction on account of facilities provided by the employer.
(10%) of his regular wage for each hour of work performed
As used herein, "managerial employees" refer to those between ten o’clock in the evening and six o’clock in the
whose primary duty consists of the management of the morning.
establishment in which they are employed or of a department Title I, Book III, Rule I, Sec. 2 (b) and (c)
or subdivision thereof, and to other officers or members of
Article 87. Overtime work. Work may be performed beyond Omnibus Rules
the managerial staff.
eight (8) hours a day provided that the employee is paid for
the overtime work, an additional compensation equivalent to
"Field personnel" shall refer to non-agricultural employees his regular wage plus at least twenty-five percent (25%)
who regularly perform their duties away from the principal thereof. SECTION 2. Exemption. — The provisions of this Rule shall
place of business or branch office of the employer and not apply to the following persons if they qualify for
whose actual hours of work in the field cannot be determined exemption under the conditions set forth herein:
Work performed beyond eight hours on a holiday or rest day
with reasonable certainty.
shall be paid an additional compensation equivalent to the
rate of the first eight hours on a holiday or rest day plus at (a) Government employees whether employed by the
Article 83. Normal hours of work. The normal hours of work least thirty percent (30%) thereof. National Government or any of its political subdivision,
of any employee shall not exceed eight (8) hours a day. including those employed in government-owned and/or
controlled corporations;
Article 88. Undertime not offset by overtime. Undertime
Health personnel in cities and municipalities with a work on any particular day shall not be offset by overtime
(b) Managerial employees, if they meet all of the following
population of at least one million (1,000,000) or in hospitals work on any other day. Permission given to the employee to
conditions:
and clinics with a bed capacity of at least one hundred (100) go on leave on some other day of the week shall not exempt
shall hold regular office hours for eight (8) hours a day, for the employer from paying the additional compensation
(1) Their primary duty consists of the management of
five (5) days a week, exclusive of time for meals, required in this Chapter.
the establishment in which they are employed or of a
department or sub-division thereof.cralaw
except where the exigencies of the service require that such Article 89. Emergency overtime work. Any employee may
personnel work for six (6) days or forty-eight (48) hours, in be required by the employer to perform overtime work in any (2) They customarily and regularly direct the work of
which case, they shall be entitled to an additional of the following cases: two or more employees therein.cralaw
compensation of at least thirty percent (30%) of their regular
wage for work on the sixth day. (3) They have the authority to hire or fire employees of
lower rank; or their suggestions and recommendations
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as to hiring and firing and as to the promotion or any in the field cannot be determined with reasonable b. Implement strictly and consistently the Policy on
other change of status of other employees, are given certainty.cralaw Discipline.
particular weight.cralaw
1. Coverage
c. Ensure that the said Policy on Discipline is
(c) Officers or members of a managerial staff if they perform a. Managerial employees v Managerial communicated to and understood by all employees.
the following duties and responsibilities: staff/Supervisors
(1) The primary duty consists of the performance of 1. Test d. Monitor compliance by employees with the said
work directly related to management policies of their Policy.
employer;
G.R. No. 186070 April 11, 2011 e. Advise HR Manager on the state of discipline in their
(2) Customarily and regularly exercise discretion and respective departments; problems, if any, and
independent judgment; and CLIENTLOGIC PHILPPINES, INC. (now
recommend solution(s) and corrective action(s).
known as SITEL), JOSEPH
(3) VELASQUEZ, IRENE ROA, and
RODNEY SPIRES, Petitioners, As correctly observed by the CA and the LA, these duties
(i) Regularly and directly assist a proprietor vs. clearly pertained to "Division Managers/Department
or a managerial employee whose primary BENEDICT CASTRO, Respondent. Managers/ Supervisors," which respondent was not, as he
duty consists of the management of the was merely a team supervisor. Petitioners themselves
establishment in which he is employed or described respondent as "the superior of a call center agent;
he heads and guides a specific number of agents, who form
subdivision thereof;
He was just a team Supervisor and not (an) HR or a team."181âwphi1
or (ii) execute under general supervision work Department Supervisor.15
along specialized or technical lines requiring From the foregoing, respondent is thus entitled to his claims
special training, experience, or knowledge; We find no reversible error in the above ruling. The test of for holiday pay, service incentive leave pay, overtime pay
"supervisory" or "managerial status" depends on and rest day pay,
or (iii) execute, under general supervision, whether a person possesses authority to act in
special assignments and tasks; and the interest of his employer and whether such
authority is not merely routinary or clerical in
nature, but requires the use of independent
(4) Who do not devote more than 20 percent of their hours judgment.16 The position held by respondent and its G.R. No. 173357 February 13,
worked in a work week to activities which are not directly and concomitant duties failed to hurdle this test. 2013
closely related to the performance of the work described in ROWENA DE LEON CRUZ, Petitioner,
paragraphs (1), (2) and (3) above.cralaw As a coach or team supervisor, respondent’s main duty was vs.
to deal with customer complaints which could not be handled BANK OF THE PHILIPPINE
(d) Domestic servants and persons in the personal service of or solved by call center agents. If the members of his team ISLANDS, Respondents.
another if they perform such services in the employer's home could not meet the needs of a customer, they passed the
which are usually necessary or desirable for the customer’s call to respondent.
maintenance and enjoyment thereof, or minister to the
personal comfort, convenience, or safety of the employer as In this case, respondent avers that petitioner held the
This job description does not indicate that respondent can position of Assistant Manager in its Ayala Avenue Branch.
well as the members of his employer's household.cralaw exercise the powers and prerogatives equivalent to However, petitioner contends that her position was only
managerial actions which require the customary use of Cash II Officer.
(e) Workers who are paid by results, including those who are independent judgment. There is no showing that he was
paid on piece-work, "takay," "pakiao" or task basis, and other actually conferred or was actually exercising the following
non-time work if their output rates are in accordance with the duties attributable to a "member of the managerial staff The test of "supervisory" or "managerial status" depends on
standards prescribed under Section 8, Rule VII, Book Three whether a person possesses authority to act in the interest of
of these regulations, or where such rates have been fixed by his employer and whether such authority is not merely
According to petitioners, respondent also performed the routinary or clerical in nature, but requires the use of
the Secretary of Labor and Employment in accordance with
following duties, as shown in the company’s Statement of independent judgment.22
the aforesaid Section.cralaw
Policy on Discipline:
(f) Non-agricultural field personnel if they regularly perform
In respondent's Position Paper23 before the NLRC and its
their duties away from the principal or branch office or place a. Know and understand in full the Policy on Discipline Memorandum,24 respondent stated that the responsibility of
of business of the employer and whose actual hours of work including their underlying reasons. petitioner, among others, were as follows:

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(1) to maintain the integrity of the signature card files of In contrast, in the case at bar, during the entire course principal place of business of the employer and whose actual
certificates of deposits and/or detect spurious signature of their fishing voyage, fishermen employed by hours of work in the field cannot be determined with
cards in the same files; petitioner have no choice but to remain on board its reasonable certainty.
(2) to ensure that releases of original CDS are done only vessel. Although they perform non-agricultural work
Thus, in order to conclude whether an employee is a field
against valid considerations and made only to the away from petitioner's business offices, the fact remains
employee, it is also necessary to ascertain if actual hours of
legitimate depositors or their duly authorized that throughout the duration of their work they are under
work in the field can be determined with reasonable certainty
representatives; the effective control and supervision of petitioner
by the employer. In so doing, an inquiry must be made as to
(3) to approve payments or withdrawals of deposits by through the vessel's patron or master as the NLRC
whether or not the employee's time and performance are
clients to ensure that such withdrawals are valid correctly held
constantly supervised by the employer.31
transactions of the bank; and
(4) to supervise the performance of certain rank-and-file
employees of the branch.
Guided by the foregoing norms, the NLRC properly
concluded that the petitioners are not field personnel but
Petitioner holds a managerial status since she is tasked to
G.R. No. 211141, June 29, 2016 regular employees who perform tasks usually necessary and
act in the interest of her employer as she exercises
HILARIO DASCO, REYMIR PARAFINA, desirable to the respondents' business.
independent judgment when she approves pre-termination of
USD CDs or the withdrawal of deposits. RICHARD PARAFINA, EDILBERTO
ANIA, MICHAEL ADANO, JAIME BOLO, Evidently, the petitioners are not field personnel as defined
RUBEN E. GULA, ANTONIO above and the NLRC's finding in this regard is supported by
In fact, petitioner admitted the exercise of independent
CUADERNO AND JOVITO the established facts of this case:
judgment when she explained that as regards the pre-
termination of the USD CDs of Uymatiao and Caluag, the CATANGUI, Petitioners, v. PHILTRANC
transactions were approved on the basis of her independent O SERVICE ENTERPRISES (1) the petitioners, as bus drivers and/or conductors, are
judgment that the signatures in all the documents presented INC/CENTURION SOLANO, directed to transport their passengers at a specified
to her by the traders matched, as shown in her reply25 dated MANAGER, Respondents. time and place;
April 23, 2002 to respondent's memorandum asking her to (2) they are not given the discretion to select and contract
explain the unauthorized preterminations/withdrawals of U.S. with prospective passengers;
dollar deposits in the BPI Ayala Avenue Branch. The main issue in this case is whether the petitioners as bus (3) their actual work hours could be determined with
drivers and/or conductors are field personnel, and thus reasonable certainty, as well as their average trips per
entitled to overtime pay and SIL pay.28chanrobleslaw month; and
b. Field personnel
(4) the respondents supervised their time and performance
1. Actual hours of work cannot Ruling of the Court of duties.
be determined with reasonable certainty
The petition is impressed with merit.
In order to monitor their drivers and/or conductors, as
The determination of whether bus drivers and/or conductors
well as the passengers and the bus itself, the bus
G.R. No. 112574 October 8, 1998 are considered as field personnel was already threshed out
companies put checkers, who are assigned at tactical
MERCIDAR FISHING CORPORATION in the case of Auto Bus Transport Systems, Inc. v.
places along the travel routes that are plied by their
represented by its President DOMINGO Bautista,30 where the Court explained that:
buses.
B. NAVAL, petitioner,
vs. As a general rule, [field personnel] are those whose
NATIONAL LABOR RELATIONS performance of their job/service is not supervised by the The drivers and/or conductors are required to be at the
employer or his representative, the workplace being away specific bus terminals at a specified time. In addition,
COMMISSION and FERMIN AGAO,
from the principal office and whose hours and days of work there are always dispatchers in each and every bus
JR., respondents.
cannot be determined with reasonable certainty; hence, they terminal, who supervise and ensure prompt departure
are paid specific amount for rendering specific service or at specified times and arrival at the estimated proper
performing specific work. If required to be at specific places time. Obviously, these drivers and/or conductors cannot
Petitioner argues essentially that since the work of private at specific times, employees including drivers cannot be said be considered as field personnel because they are
respondent is performed away from its principal place of to be field personnel despite the fact that they are performing under the control and constant supervision of the bus
business, it has no way of verifying his actual hours of work work away from the principal office of the employee, x x x companies while in the performance of their work.
on the vessel. It contends that private respondent and other xxxx
fishermen in its employ should be classified as "field x x x At this point, it is necessary to stress that the definition
personnel" who have no statutory right to service incentive of a "field personnel" is not merely concerned with the location
leave pay. where the employee regularly performs his duties but also
with the fact that the employee's performance is unsupervised
by the employer. As discussed above, field personnel are
those who regularly perform their duties away from the
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c. Family members (d) Domestic worker or "Kasambahay" refers to any
d. Domestic helpers; persons in the person engaged in domestic work within an
personal service of another employment relationship such as, but not limited to, the
following: general househelp, nursemaid or "yaya",
cook, gardener, or laundry person, but shall exclude G.R. Nos. 169295-96 November
any person who performs domestic work only 20, 2006
occasionally or sporadically and not on an occupational REMINGTON INDUSTRIAL SALES
Title I, Book III, Rule I, Sec. 2(d) CORPORATION, Petitioner,
basis.
vs.
ERLINDA CASTANEDA, Responden
The term shall not include children who are under foster
(d) Domestic servants and persons in the personal service of family arrangement, and are provided access to
another if they perform such services in the employer's home education and given an allowance incidental to
which are usually necessary or desirable for the education, i.e. "baon", transportation, school projects The petitioner raises the following errors of law: (1) the Court
and school activities. of Appeals erred in affirming the NLRC’s ruling that the
maintenance and enjoyment thereof, or minister to the
personal comfort, convenience, or safety of the employer as respondent was petitioner’s regular employee and not a
well as the members of his employer's household. (e) Employer refers to any person who engages and domestic helper;
controls the services of a domestic worker and is party
to the employment contract. Petitioner relies heavily on the affidavit of a certain Mr.
Antonio Tan and contends that respondent is the latter’s
Section 1 (b), Omnibus Rules, Rule XIII (f) Household refers to the immediate members of the domestic helper and not a regular employee of the company
family or the occupants of the house that are directly since Mr. Tan has a separate and distinct personality from
provided services by the domestic worker. the petitioner.

It maintains that it did not exercise control and supervision


SECTION 1. General statement on coverage. — over her functions; and that it operates as a trading company
(a) The provisions of this Rule shall apply to all househelpers and does not engage in the restaurant business, and
whether employed on full or part-time basis. therefore respondent’s work as a cook, which was not
usually necessary or desirable to its usual line of business or
ARTICLE IV trade, could not make her its regular employee.
(b) The term "househelper" as used herein is synonymous to EMPLOYMENT – TERMS AND CONDITIONS
the term "domestic servant" and shall refer to
The petition must fail. We affirm that respondent was a
(1) any person, whether male or female, regular employee of the petitioner and that the latter was
Section 22. Assignment to Nonhousehold Work. – No
(2) who renders services in and about the employer's home domestic worker shall be assigned to work in a commercial, guilty of illegal dismissal.
(3) and which services are usually necessary or desirable industrial or agricultural enterprise at a wage rate lower than
for the maintenance and enjoyment thereof, that provided for agricultural or nonagricultural workers. In In Apex Mining Company, Inc. v. NLRC,32 this Court held
such cases, the domestic worker shall be paid the applicable that a househelper in the staff houses of an industrial
(4) and ministers exclusively to the personal comfort and
minimum wage. company was a regular employee of the said firm
enjoyment of the employer's family.

Section 23. Extent of Duty. – The domestic worker and the In the case at bar, the petitioner itself admits in its position
employer may mutually agree for the former to temporarily paper that respondent worked at the company premises and
perform a task that is outside the latter’s household for the her duty was to cook and prepare its employees’ lunch
benefit of another household. and merienda.
RA 10361 AN ACT INSTITUTING
POLICIES FOR THE PROTECTION
AND WELFARE OF DOMESTIC However, any liability that will be incurred by the domestic Clearly, the situs, as well as the nature of respondent’s work
WORKERS worker on account of such arrangement shall be borne by as a cook, who caters not only to the needs of Mr. Tan and
the original employer. In addition, such work performed his family but also to that of the petitioner’s employees,
outside the household shall entitle the domestic worker to an makes her fall squarely within the definition of a regular
additional payment of not less than the existing minimum employee under the doctrine enunciated in the Apex Mining
Section 4. Definition of Terms. – As used in this Act, the wage rate of a domestic worker. It shall be unlawful for the case. That she works within company premises, and that she
term: original employer to charge any amount from the said does not cater exclusively to the personal comfort of Mr. Tan
household where the service of the domestic worker was and his family, is reflective of the existence of the petitioner’s
temporarily performed. right of control over her functions, which is the primary
(c) Domestic work refers to work performed in or for a
household or households.
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indicator of the existence of an employer-employee Petitioners allege that they were dismissed by private Payment by the piece is just a method of compensation and
relationship. respondents as they were about to file a petition with the does not define the essence of the relations.[7] Nor does the
Department of Labor and Employment (DOLE) for the fact that petitioners are not covered by the SSS affect the
payment of benefits such as Social Security System (SSS) employer-employee relationship.
Moreover, it is wrong to say that if the work is not directly
coverage, sick leave and vacation leave. They deny that they
related to the employer's business, then the person
abandoned their work.
performing such work could not be considered an employee Indeed, the following factors show that petitioners, although
of the latter. piece-rate workers, were regular employees of private
The petition is meritorious. respondents:
Indeed, it would be the height of injustice if we were to hold
that despite the fact that respondent was made to cook lunch First. There is no dispute that petitioners were employees of (1) within the contemplation of Art. 280 of the Labor Code,
and merienda for the petitioner’s employees, which work private respondents although they were paid not on the basis their work as tailors was necessary or desirable in the
ultimately redounded to the benefit of the petitioner of time spent on the job but according to the quantity and the usual business of private respondents, which is
corporation, she was merely a domestic worker of the family quality of work produced by them. engaged in the tailoring business;
of Mr. Tan (2) petitioners worked for private respondents throughout
the year, their employment not being dependent on a
There are two categories of employees paid by results:
specific project or season; and,
(3) petitioners worked for private respondents for more
(1) those whose time and performance than one year
e. Workers paid by results
are supervised by the employer. (Here, there is an
element of control and supervision over the manner as
to how the work is to be performed. A piece-rate worker
belongs to this category especially if he performs his 2. Hours of work
Section 9, Title I, Rule VII, Book III, work in the company premises.); and
Omnibus Rules

(2) those whose time and performance


are unsupervised. (Here, the employers control is over Labor Code
SECTION 9. Workers Paid by Results. — the result of the work. Workers
on pakyao and takay basis belong to this group.)

a) All workers paid by results, including those who are paid Article 84. Hours worked. Hours worked shall include
on piecework, takay, pakyaw, or task basis, shall receive not Both classes of workers are paid per unit accomplished.
less than the applicable statutory minimum wage rates
prescribed under the Act for the normal working hours which Piece-rate payment is generally practiced in garment (a) all time during which an employee is required to be on
shall not exceed eight hours work a day, or a proportion factories where work is done in the company premises, duty or to be at a prescribed workplace; and
thereof for work of less than the normal working hours.cralaw while payment on pakyao and takay basis is commonly (b) all time during which an employee is suffered or
observed in the agricultural industry, such as in sugar permitted to work.
plantations where the work is performed in bulk or in
volumes difficult to quantify.[4] Rest periods of short duration during working hours shall be
i. Categories counted as hours worked.
Petitioners belong to the first category, i.e., supervised
employees.

G.R. No. 111042. October 26, 1999] DOLE D.O. No. 118-12
In this case, private respondents exercised control over the
work of petitioners. As tailors, petitioners worked in the
companys premises from 8:00 a.m. to 7:00 p.m. daily,
AVELINO LAMBO and VICENTE
including Sundays and holidays. The mere fact that they
BELOCURA, petitioners, vs. NATIONAL Section 3. Hours of Work and Hours of Rest. - The normal
were paid on a piece-rate basis does not negate their status
LABOR RELATIONS COMMISSION and hours of work of a driver and conductor shall not exceed
as regular employees of private respondents.
J.C. TAILOR SHOP and/or JOHNNY eight (8) hours a day.
CO, respondents.
The term wage is broadly defined in Art. 97 of the Labor
If a driver/conductor is required to work overtime, the
Code as remuneration or earnings, capable of being
maximum hours of work shall not exceed twelve (12) hours
expressed in terms of money whether fixed or ascertained
in any 24-hour period, subject to the overriding safety
on a time, task, piece or commission basis.
operational conditions of the public utility bus.

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Driver and conductors shall be entitled to rest periods of at c. Engaged to wait/idle time seamen, i.e., those employed in vessels plying in rivers and
least one (1) hour, exclusive of meal breaks, within a 12-hour bays, since admittedly there is no need for such ruling with
shift respect to officers and crew of interisland vessels which
have aboard 2 shifts of said men and strictly follow the 8-
Rule I, Book III, Omnibus Rules hour working period.

a. Compensable working hours


For the purposes of this ease, We do not need to set for
b. Principles in determining ours worked seamen a criterion different from that applied to laborers on
SECTION 5. Waiting time. — (a) Waiting time spent by an
employee shall be considered as working time if waiting is an land, for under the provisions of the above quoted section,
integral part of his work or the employee is required or the only thing to be done is to determine the meaning and
engaged by the employer to wait scope of the term "working place" used therein.
Title I, Rule I, Book III, Omnibus Rules
In the case at bar We do not need to look into the nature of
the work of claimant mariners to ascertain the truth of
petitioner’s allegation that this kind of seamen have had
[G.R. No. L-9265. April 29, 1957.]
SECTION 3. Hours worked. — The following shall be enough "free time", a task of which We are relieved, for
considered as compensable hours worked: although after an ocular inspection of the working premises
LUZON STEVEDORING CO., of the seamen affected in this case the trial Judge declared
INC., Petitioner, v. LUZON MARINE in his decision that the Company gave the complaining
(a) All time during which an employee is required to be on DEPARTMENT UNION and THE HON. laborers 3 free meals a day with a recess of 20 minutes after
duty or to be at the employer's premises or to be at a MODESTO CASTILLO, THE HON. JOSE each meal, this decision was specifically amended by the
prescribed work place; and S. BAUTISTA, THE HON. V. JIMENEZ Court en banc in its Resolution of June 6, 1955, wherein it
(b) All time during which an employee is suffered or YANSON and THE HON. JUAN L. held that the claimants herein rendered services to the
permitted to work LANTING, Judges of the Court of Company from 6:00 a.m. to 6:00 p.m. including Sundays and
Industrial Relations, Respondents. c holidays, which implies either that said laborers were not
SECTION 4. Principles in determining hours worked. — given any recess at all, or that they were not allowed to leave
The following general principles shall govern in determining the spot of their working place, or that they could not rest
whether the time spent by an employee is considered hours completely.
worked for purposes of this Rule: I. Is the definition for "hours of work" as presently applied to
dryland laborers equally applicable to seamen? Or should a
(a) All hours are hours worked which the employee is different criterion be applied by virtue of the fact that the G.R. No. L-15422 November 30,
required to give his employer, regardless of whether or seamen’s employment is completely different in nature as 1962
not such hours are spent in productive labor or involve well as in condition of work from that of a dryland laborer?
NATIONAL DEVELOPMENT
physical or mental exertion. COMPANY, petitioner,
(b) An employee need not leave the premises of the work Petitioner questions the applicability to seamen of the
interpretation given to the phrase "hours of work" for the vs.
place in order that his rest period shall not be counted, COURT OF INDUSTRIAL RELATIONS
it being enough that he stops working, may rest purpose of the Eight-Hour Labor Law, insinuating that
although the seamen concerned stayed in petitioner’s and NATIONAL TEXTILE WORKERS
completely and may leave his work place, to go
tugboats, or merely within its compound, for 12 hours, yet UNION, respondents.
elsewhere, whether within or outside the premises of
his work place. their work was not continuous but interrupted or broken. It
(c) If the work performed was necessary, or it benefited the has been the consistent stand of petitioner that while it is
employer, or the employee could not abandon his work true that the workers herein were required to report for work
at 6:00 a.m. and were made to stay up to 6:00 p.m., their At the National Development Co., a government-owned and
at the end of his normal working hours because he had controlled corporation, there were four shifts of work. One
no replacement, all time spent for such work shall be work was not continuous and they could have left the
premises of their working place were it not for the inherent shift was from 8 a.m. to 4 p.m., while the three other shifts
considered as hours worked, if the work was with the were from 6 a.m. to 2 p.m; then from 2 p.m. to 10 p.m. and,
knowledge of his employer or immediate supervisor. physical impossibility peculiar to the nature of their duty
which prevented them from leaving the tugboats. finally, from 10 p.m. to 6 a.m.
(d) The time during which an employee is inactive by
reason of interruptions in his work beyond his control
shall be considered working time either if the It is the Company’s defense that a literal interpretation of In each shift, there was a one-hour mealtime period, to wit:
imminence of the resumption of work requires the what constitutes non-working hours would result in absurdity From (1) 11 a.m. to 12 noon for those working between 6
employee's presence at the place of work or if the if made to apply to seamen aboard vessels in bays and a.m. and 2 p.m. and from (2) 7 p.m. to 8 p.m. for those
interval is too brief to be utilized effectively and gainfully rivers, and We are called upon to make an interpretation of working between 2 p.m. and 10 p.m.
in the employee's own interest. the law on "non-working hours" that may comprehend within
its embrace not only the non-working hours of laborers The records disclose that although there was a one-hour
employed in land jobs, but also of that particular group of mealtime, petitioner nevertheless credited the workers with
LABOR LAW I under Atty. Nolasco | COMPILATION OF DOCTRINES AND LAWS | DLSU law | Quebal
eight hours of work for each shift and paid them for the same the resolution of this Court in Sime Darby International Tire They are not new employees as to require the company to
number of hours. Co., Inc. v. NLRC.[2] deliver long briefings regarding their respective work
assignments.
However, since 1953, whenever workers in one shift were With the new work schedule, the employees are now given a
required to continue working until the next shift, petitioner one-hour lunch break without any interruption from their Their houses are situated right on the area where the farm
instead of crediting them with eight hours of overtime work, employer. For a full one-hour undisturbed lunch break, the are located, such that after the roll call, which does not
has been paying them for six hours only, petitioner that the employees can freely and effectively use this hour not only necessarily require the personal presence, they can go back
two hours corresponding to the mealtime periods should not for eating but also for their rest and comfort which are to their houses to attend to some chores.
be included in computing compensation. conducive to more efficiency and better performance in their
work. Since the employees are no longer required to work
In short, they are not subject to the absolute control of the
during this one-hour lunch break, there is no more need for
Petitioner gives an eight-hour credit to its employees who company during this period, otherwise, their failure to report
them to be compensated for this period.
work a single shift say from 6 a.m. to 2 p.m. Why cannot it in the assembly time would justify the company to impose
credit them sixteen hours should they work in two shifts? disciplinary measures.
e. Assembly time
This, therefore, demonstrates the indubitable fact that the
thirty (30)-minute assembly time was not primarily intended
for the interests of the employer, but ultimately for the
d. On call Arica v NLRC, 78210 (1989) employees to indicate their availability or non-availability for
work during every working day. (Annex "E", Rollo, p. 57).

Section 5(b), Rule I, Book III, Omnibus 1) Whether or not the 30-minute activity of the petitioners f. Commuting time, travel time at
Rules before the scheduled working time is compensable under the lectures, seminars, etc
Labor Code.

Petitioners contend that the preliminary activities as workers


(b) An employee who is required to remain on call in the Rule I, Book III, Omnibus Rules
of respondents STANFILCO in the assembly area is
employer's premises or so close thereto that he cannot use compensable as working time (from 5:30 to 6:00 o'clock in
the time effectively and gainfully for his own purpose shall be the morning) since these preliminary activities are
considered as working while on call. necessarily and primarily for private respondent's benefit.
SECTION 6. Lectures, meetings, training programs. —
Attendance at lectures, meetings, training programs, and
An employee who is not required to leave word at his home These preliminary activities of the workers are as follows: other similar activities shall not be counted as working time if
or with company officials where he may be reached is not
all of the following conditions are met:
working while on call.
(a) First there is the roll call. This is followed by getting their
individual work assignments from the foreman. (a) Attendance is outside of the employee's regular working
(b) Thereafter, they are individually required to accomplish hours;
the Laborer's Daily Accomplishment Report during (b) Attendance is in fact voluntary; and
which they are often made to explain about their (c) The employee does not perform any productive work
reported accomplishment the following day. during such attendance.
[G.R. No. 119205. April 15, 1998] (c) Then they go to the stockroom to get the working
SIME DARBY PILIPINAS, materials, tools and equipment.
(d) Lastly, they travel to the field bringing with them their
INC., petitioner, vs. NATIONAL LABOR
tools, equipment and materials.
RELATIONS COMMISSION (2ND g. Semestral break
DIVISION) and SIME DARBY SALARIED
EMPLOYEES ASSOCIATION (ALU- All these activities take 30 minutes to accomplish
TUCP), respondents.
The Minister of Labor held: University of Pangasinan Faculty Union v
University of Pangasinan, L-63122
Since private respondent felt affected adversely by the Furthermore, the thirty (30)-minute assembly is a deeply-
change in the work schedule and discontinuance of the 30- rooted, routinary practice of the employees, and the
minute paid on call lunch break, it filed on behalf of its proceedings attendant thereto are not infected with
members a complaint with the Labor Arbiter for unfair labor complexities as to deprive the workers the time to attend to
practice, discrimination and evasion of liability pursuant to other personal pursuits.
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It is beyond dispute that the petitioner’s members are full- If the driver/conductor is required to work a rest day, he/she
time employees receiving their monthly salaries irrespective Rule I, Book III, Omnibus Rules shall be paid an additional premium pay of 30% of the basic
of the number of working days or teaching hours in a month. wage.

However, they find themselves in a most peculiar situation if the driver/conductor is required to work on special days
whereby they are forced to go on leave during semestral SECTION 7. Meal and Rest Periods. — under R.A. No. 9849, he/she shall also be paid an additional
breaks. premium pay of 30% of the basic wage. Whenever work is
Every employer shall give his employees, regardless of sex, performed on a rest day, which happens to be also a special
not less than one (1) hour time-off for regular meals, day, he/she is entitled to an additional 50% of the basic
These semestral breaks are in the nature of work
wage.
interruptions beyond the employees’ control. The duration of
the semestral break varies from year to year dependent on a except in the following cases when a meal period of not less
variety of circumstances affecting at times only the private than twenty (20) minutes may be given by the employer Section 3. Hours of Work and Hours of Rest. - The normal
respondent but at other times all educational institutions in hours of work of a driver and conductor shall not exceed
the country. eight (8) hours a day.
provided that such shorter meal period is credited as
compensable hours worked of the employee:
As such, these breaks cannot be considered as absences If the driver/conductor is required to work overtime, the
within the meaning of the law for which deductions may be maximum hours of work shall not exceed twelve (12) hours
made from monthly allowances. (a) Where the work is non-manual work in nature or in any 24-hour period, subject to the overriding safety and
does not involve strenuous physical exertion; operational conditions of the public utility bus.
The "No work, no pay" principle does not apply in the instant
case. The petitioner’s members received their regular (b) Where the establishment regularly operates not less Drivers and conductors shall be entitled to rest periods of at
salaries during this period. It is clear from the aforequoted than sixteen (16) hours a day; least one (1) hour, exclusive of meal breaks, within a 12-hour
provision of law that it contemplates a "no work" situation shift
where the employees voluntarily absent themselves. (c) In case of actual or impending emergencies or there
is urgent work to be performed on machineries,
Petitioners, in the case at bar, certainly do not, ad equipment or installations to avoid serious loss which
voluntatem, absent themselves during semestral breaks. the employer would otherwise suffer; and RA 10361 - AN ACT INSTITUTING
Rather, they are constrained to take mandatory leave from POLICIES FOR THE PROTECTION
work. AND WELFARE OF DOMESTIC
(d) Where the work is necessary to prevent serious loss
WORKERS
of perishable goods
There are papers to correct, students to evaluate, deadlines
to meet, and periods within which to submit grading reports. Rest periods or coffee breaks running from five (5) to twenty
Although they may be considered by the respondent to be on (20) minutes shall be considered as compensable working Section 20. Daily Rest Period. – The domestic worker shall
leave, the semestral break could not be used effectively for time. be entitled to an aggregate daily rest period of eight (8)
the teacher’s own purposes for the nature of a teacher’s job
hours per day.
imposes upon him further duties which must be done during
the said period of time.
Section 21. Weekly Rest Period. – The domestic worker
shall be entitled to at least twenty-four (24) consecutive
h. Meal break, coffee break
hours of rest in a week. The employer and the domestic
i. Rest period worker shall agree in writing on the schedule of the weekly
rest day of the domestic worker:
Labor Code
Provided, That the employer shall respect the preference of
Dole D.O. No. 118-12
the domestic worker as to the weekly rest day when such
preference is based on religious grounds.
Article 85. Meal periods. Subject to such regulations as the
Secretary of Labor may prescribe, it shall be the duty of Section 2. Minimum benefits. - The public utility bus drivers Nothing in this provision shall deprive the domestic worker
every employer to give his employees not less than sixty (60) and conductors are entitled to the following benefits: and the employer from agreeing to the following:
minutes time-off for their regular meals.

(c) Rest day for twenty-four (24) consecutive hours for every (a) Offsetting a day of absence with a particular rest
six (6) consecutive working days. day;

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(b) Waiving a particular rest day in return for an We already resolved the question of overtime pay of worker indeed been rendered, we cannot affirm the grant of
equivalent daily rate of pay; aboard a vessel in the case of National Shipyards and Steel overtime pay to Pigcaulan.
Corporation v. CIR (3 SCRA 890). We ruled:
(c) Accumulating rest days not exceeding five (5) days;
or We can not agree with the Court below that respondent
Malondras should be paid overtime compensation for Robina farms Cebu v Villa, 175869
every hour in excess of the regular working hours that (2012)
(d) Other similar arrangements.
he was on board his vessel or barge each day,
irrespective of whether or not he actually put in work
j. Overtime during those hours. Seamen are required to stay on
board their vessels by the very nature of their duties, Although ordering Villa's reinstatement, the Labor Arbiter
and it is for this reason that, in addition to their regular denied her claim for backwages and overtime pay because
compensation, they are given free living quarters and she had not adduced evidence of the overtime work actually
Labor Code subsistence allowances when required to be on board. performed.

The correct criterion in determining whether or not sailors are The Labor Arbiter declared that Villa was entitled to service
entitled to overtime pay is not, therefore, whether they were incentive leave pay for the period of the last three years
Article 87. Overtime work. Work may be performed beyond on board and can not leave ship beyond the regular eight counted from the filing of her complaint because the
eight (8) hours a day provided that the employee is paid for working hours a day, but whether they actually rendered petitioner did not refute her claim thereon.
the overtime work, an additional compensation equivalent to service in excess of said number of hours. (Italics supplied)
his regular wage plus at least twenty-five percent (25%)
Firstly, entitlement to overtime pay must first be established
thereof. Work performed beyond eight hours on a holiday or
ii. Evidence/Required proof by proof that the overtime work was actually performed
rest day shall be paid an additional compensation equivalent
before the employee may properly claim the benefit.[31]
to the rate of the first eight hours on a holiday or rest day
plus at least thirty percent (30%) thereof.
The burden of proving entitlement to overtime pay rests on
Pigcaulan v Security and Credit, 173648 the employee because the benefit is not incurred in the
i. Seafarers (2012) normal course of business.[32] Failure to prove such actual
performance transgresses the principles of fair play and
equity.
[G.R. No. 122240. November 18, 1999] There was no substantial evidence to support the grant of And, secondly, the NLRC's reliance on the daily time records
CRISTONICO B. LEGAHI, petitioner, vs. overtime pay. (DTRs) showing that Villa had stayed in the company's
NATIONAL LABOR RELATIONS premises beyond eight hours was misplaced.
COMMISSION and UNITED PHILIPPINE
LINES, INC., NORTHSOUTH SHIP The handwritten itemized computations are self-serving,
unreliable and unsubstantial evidence to sustain the grant of The DTRs did not substantially prove the actual performance
MGT., (PTE), LTD., SINGAPORE, of overtime work.
salary differentials, particularly overtime pay.
GREGORIO V. DE LIMA, JR., TOR
KARLSEN and PIONEER INSURANCE
& SURETY CORP., respondents. Unsigned and unauthenticated as they are, there is no way The petitioner correctly points out that any employee could
of verifying the truth of the handwritten entries stated render overtime work only when there was a prior
therein. Written only in pieces of paper and solely prepared authorization therefor by the management.[33]
by Canoy and Pigcaulan, these representative daily time
Petitioners dismissal without a valid cause constitute a records, as termed by the Labor Arbiter, can hardly be
Without the prior authorization, therefore, Villa could not
breach of contract. Consequently, he should only be paid the considered as competent evidence to be used as basis to
validly claim having performed work beyond the normal
unexpired portion of his employment contract. prove that the two were underpaid of their salaries. hours of work. Moreover, Section 4(c), Rule I, Book III of
the Omnibus Rules Implementing the Labor Code relevantly
However, the payment of the overtime pay should be We find nothing in the records which could substantially states as follows:
disallowed in the light of our ruling in the case of Cagampan support Pigcaulans contention that he had rendered service
v. NLRC,[11] where we held that: beyond eight hours to entitle him to overtime pay and during
Sundays to entitle him to restday pay.
(a) x x x
For the employer to give him overtime pay for the extra (b)
hours when he might be sleeping or attending to his personal Hence, in the absence of any concrete proof that additional If the work performed was necessary, or it benefited the
chores or even just lulling away his time would be extremely service beyond the normal working hours and days had (c) employer, or the employee could not abandon his work at
unfair and unreasonable. the end of his normal working hours because he had no
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replacement, all time spent for such work shall be "Article 157. Transfer. - Night workers who are certified as which may attach to her regular
considered as hours worked, if the work was with the unfit for night work, due to health reasons, shall be night work position.
knowledge of his employer or immediate supervisor. transferred, whenever practicable, to a similar job for which
(bold emphasis supplied) they are fit to work.
"Pregnant women and nursing
(d) x x x.
mothers may be allowed to work .at
"If such transfer to a similar job is not practicable, these night only if a competent physician,
k. Undertime workers shall be granted the same benefits as other workers other than the company physician,
who are unable to work, or to secure employment during shall certify their fitness to render
l. Night work such period. night work, and specify, in the case
of pregnant employees, the period
of the pregnancy that they can
"A night worker certified as temporarily unfit for night work
safely work.
Labor Code shall be given the same protection against dismissal or
notice of dismissal as other workers who are prevented from
working for reasons of health." "The measures referred to in this
article may include transfer to day
work where this is possible, the
Article 86. Night shift differential. Every employee shall be "Article 158. Women Night Workers. - Measures shall be
provision of social security benefits
paid a night shift differential of not less than ten percent taken to ensure that an alternative to night work is available
or an extension of maternity leave.
(10%) of his regular wage for each hour of work performed to women workers who would otherwise be called upon to
between ten o’clock in the evening and six o’clock in the perform such work:
morning. "The provisions of this article shall
not leave the effect of reducing the
"(a) Before and after childbirth, for a period of at least
protection and benefits connected
sixteen (16) weeks, which shall be divided between the
with maternity leave under existing
REPUBLIC ACT NO. 10151 time before and after childbirth;
laws."
AN ACT ALLOWING THE
EMPLOYMENT OF NIGIIT WORKERS, "(b) For additional periods, in respect of winch a
THEREBY REPEALING ARTICLES 130 medical certificate IS produced stating that said
AND 131 OF PRESIDENTIAL DECREE additional periods are necessary for the health of the DOLE D.O. 119-12 Rules implementing
NUMBER FOUR HUNDRED FORTY- mother or child: R.A. No. 10151
TWO, AS AMENDED, OTHERWISE
KNOWN AS THE LABOR CODE OF "(1) During pregnancy;
THE PHILIPPINES
Section 1. Coverage - This rule shall apply to all persons
"(2) During a specified time beyond the who shall be employed or permitted or suffered to work at
period, after childbirth is fixed pursuant to night, except those employed in agriculture, stock raising,
"Chapter V subparagraph (a) above, the length of which fishing, maritime transport and inland navigation
"Employment of Night Workers shall be determined by the DOLE after
consulting the labor organizations and
employers. Section 2. Definition. - As used herein, "night worker"
"Article 154. Coverage. - This chapter' shall apply to means any employed person whose work covers the period
of 10:00 p.m. to 6:00 a.m. provided that the worker performs
"During the periods referred to in this article: work no less than seven (7) consecutive hours of work
(a) all persons, who shall be employed or permitted or
suffered to work at night,
(b) except those employed in agriculture, stock raising, "(i) A woman worker shall not be Section 5. Transfer. - Night workers who are certified by
fishing, maritime transport and inland navigation, dismissed or given notice of competent physician as unfit to render night work, due to
(c) during a period of not less than seven (7) consecutive dismissal, except for just or health reasons, shall be transferred to a job for which they
hours, authorized causes provided for in are fit to work whenver practicable. The transfer of the
(d) including the interval from midnight to five o'clock in the this Code that are not connected employee must be similar or equivalent position and in good
morning, with pregnancy, childbirth and faith.
(e) to be determined by the Secretary of Labor and childcare responsibilities.
Employment,
(f) after consulting the workers' representatives/labor If such transfer is not practicable or the workers are unable
"(ii) A woman worker shall not lose to render night work for a continuous period of not less than
organizations and employers.
the benefits regarding her status, six (6) months upon the certification of a competent public
seniority, and access to promotion health authority, these workers shall be granted the same

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company benefits as other workers who are unable to work woman employee who is not in a position to render night perform it, it is but just that the laborer should earn greater
due to illness. work, she shall be allowed to go on leave or on extended salary than ordinary work so as to compensate the laborer to
maternity leave, using her earned leave credits. some extent for the said inconveniences.34
A night worker certified a temporarily unfit for night work for a
period less than six (6) months shall be given the same A woman employee shall not be dismissed for reason of Anent the payment of overtime pay, the Court explained its
protection against dismissal or notice of dismissal as other pregnancy, childbirth and childcare responsibilities as rationale in Philippine National Bank v. Philippine National
workers who are prevented from working for health reasons defined under this Rule. She shall not lose the benefits Bank Employees Association (PEMA):35
regarding her employment status, seniority, and access to
promotion which may attach to her regular night work
Section 6. Alternative measures to night work for pregnant x x x Why is a laborer or employee who works beyond
position
and nursing employees. - Employers shall ensure that the regular hours of work entitled to extra compensation
measures shall be undertaken to provide an alternative night called in this enlightened time, overtime pay?
work for pregnant and nursing employees who would Section 9. Compensation. - The night workers'
otherwise be called upon to perform such work. Such compensation shall include but not be limited to working
Verily, there can be no other reason than that he is
measures may include the transfer to day work, where is time, pay and benefits under the Labor Code, as amended
made to work longer than what is commensurate with
possible, as well as the provision of social security benefits and under existing laws, such as service incentive leave, rest
his agreed compensation for the statutorily fixed or
or an extension of maternity leave. day, night differential pay, 13th month pay, and other
voluntarily agreed hours of labor he is supposed to do.
benefits as provided for by law, company policy or CBA.
(a) Transfer to day work. - As far as practicable,
When he thus spends additional time to his work, the
pregnant or nursing employees shall be assigned to day i. Rationale
effect upon him is multi-faceted: he puts in more effort,
work, before and after childbirth for a period of at least
physical and/or mental; he is delayed in going home to
sixteen (16) weeks which shall be divided between the time
his family to enjoy the comforts thereof; he might have
before and after childbirth
no time for relaxation, amusement or sports; he might
Association of International shipping v miss important pre-arranged engagements; etc., etc. It
Medical certificate issued by competent physician United Harbors' Pilot Association, 172029 is thus the additional work, labor or service employed
is necessary for the grant of: (2008) and the adverse effects just mentioned of his longer
stay in his place of work that justify and is the real
reason for the extra compensation that he called
i. Additional periods of assignment to day work
overtime pay.
during pregnancy or after childbirth other than the period
Members of respondent UHPAP are entitled to nighttime
mentioned in the foregoing paragraph, provided that the
and overtime pay. Undoubtedly, pursuant to PPA AO No.
length of additional period should not be more than four (4) Overtime work is actually the lengthening of hours
03-85, members of respondent UHPAP are legally entitled to
weeks or for a longer period as may be agreed upon by the developed to the interests of the employer and the
nighttime and overtime pay.
employer and the worker; requirements of his enterprise. It follows that the wage
or salary to be received must likewise be increased,
It bears pointing out that additional compensation for and more than that, a special additional amount must
ii. extension of maternity leave; and
nighttime work is founded on public policy.32 Working at night be added to serve either as encouragement or
is violative of the law of nature for it is the period for rest and inducement or to make up for the things he loses which
iii. clearance to render night work sleep. An employee who works at night has less stamina and we have already referred to. And on this score, it must
vigor. always be borne in mind that wage is indisputably
intended as payment for work done or services
(b) Provision of social security benefits. - Social security
rendered
benefits, such as paid maternity leave shall be provided to Thus, he can easily contract disease. The lack of sunlight
women workers in accordance with the provisions of R.A. No tends to produce anemia and tuberculosis and predispose
8282 and other existing company policy or collective him to other ills. ii. Seafarers
bargaining agreement
Night work brings increased liability to eyestrain and
(c) Extension of maternity leave. - Where transfer to day accident.
work is not possible, a woman employee may be allowed to Dacut v CA, 169434 (2008)
extend, as recommended by a competent physician, her
Serious moral dangers also are likely to result from the
maternity leave without pay or using earned leave credits of
necessity of traveling the street alone at night, and from the
the worker, if any.
interference with normal home life.33 Apropos the monetary claims, there is insufficient evidence
to prove petitioners entitlement thereto. As crew members,
Section 8. Protection against dismissal and loss of benefits petitioners were required to stay on board the vessel by the
Hygienic, medical, moral, cultural and socio-biological
attached to employment status, seniority and access to very nature of their duties, and it is for this reason that, in
reasons are in accord that night work has many
promotion. - Where no alternative work can be provided to a addition to their regular compensation, they are given free
inconveniences and when there is no alternative but to
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living quarters and subsistence allowances when required to o. Exceptions to the 8-hour rule 3. The employer shall notify DOLE, through the
be on board. It could not have been the purpose of our law to i. Compressed work week Regional Office having jurisdiction over the workplace,
require their employers to give them overtime pay or night of the adoption of the CWW scheme. The notice shall
shift differential, even when they are not actually be in DOLE CWW Report form attached to this
working. Thus, the correct criterion in determining whether advisory.
they are entitled to overtime pay or night shift differential is
DOLE Advisory No. 2. (2004) -
not whether they were on board and cannot leave ship Effects. A CWW scheme which complies with the foregoing
Implementation of compressed workweek
beyond the regular eight working hours a day, but whether conditions shall have the following effects:
they actually rendered service in excess of said number of schemes
hours. In this case, petitioners failed to submit sufficient 1. Unless there is a more favorable practice existing in
proof that overtime and night shift work were actually the firm, work beyond eight hours will not be
performed to entitle them to the corresponding pay.
III. Concept and Definition - The labor code provides that compensable by overtime premium, provided the total
the normal work hours per day shall be eight hours. Work number of hours work per day shall not exceed twelve
m. No offsetting rule (12) hours. In any case, any work performed beyond 12
may be performed beyond eight hours a day provided the
employee is paid for overtime work. hours a day or 48 hours a week shall be subject to
overtime premium.
On the other hand, the normal number of workdays per week
Labor code shall be six days, or a total of forty-eight (48) hours based on 2. Consistent with Article 85 of the Labor Code,
the normal workday of eight hours. This is without prejudice employees under a CWW scheme are entitled to meal
to firms whose normal workweek is five days or total of forty periods of not less than sixty (60) minutes. Nothing
(40) hours based on the normal workday of eight hours. herein shall impair the right of employees to rest days
Article 88. Undertime not offset by overtime. Undertime as well as to holiday pay, rest day pay or leaves in
work on any particular day shall not be offset by overtime For the purposes of this advisory, a CWW scheme is an accordance with law or applicable collective bargaining
work on any other day. Permission given to the employee to agreement or company practice.
alternative arrangement whereby the normal workweek is
go on leave on some other day of the week shall not exempt
reduced to less than six days but the total number of work
the employer from paying the additional compensation 3. Adoption of the CWW scheme shall in no case result
required in this Chapter. hours per week shall remain at 48 hours. The normal
workday is increased to more than eight hours without in diminution of existing benefits. Reversion to the
corresponding overtime premium. This concept can be normal 8-hour workday shall not constitute a diminution
n. Power interruptions/brownout adjusted accordingly in cases where the normal workweek of of benefits. The reversion shall be considered a
the firm is five days. legitimate exercise of management prerogative,
provided that the employer shall give the employees
Power interruptions or brown-outs, basic rules: - IV. Specific Guidelines. - prior notice of such reversion within a reasonable period
of time
1. Brown-outs of short duration not exceeding twenty (20) Conditions. DOLE shall recognize CWW schemes adopted
minutes - compensable hours worked. in accordance with the following:
2. Brown-outs running for more than twenty (20) minutes
may not be treated as hours worked provided any of the 1. The CWW scheme is undertaken as a result of an Bisig Manggagawa sa Tryco v NLRC,
following conditions are present: express and voluntary agreement of majority of the 151309 (2008)
covered employees or their duly authorized
a. The employees can leave their workplace representatives. This agreement may be expressed
or go elsewhere whether within or without the through CBA or other legitimate workplace mechanisms
work premises; or of participation such as labor-management councils, Tryco and the petitioners signed separate
employee assemblies or referanda. Memorand[a] of Agreement[2] (MOA), providing for a
b. The employees can use the time effectively compressed workweek schedule to be implemented in the
for their own interest. 2. In firms using subtances, chemicals and process or company effective May 20, 1996.
operating under conditions where there are airborne The MOA was entered into pursuant to Department
contaminants, human carcinogens or noise, prolonged of Labor and Employment Department Order (D.O.) No. 21,
exposure to which may pose hazards to employees' Series of 1990, Guidelines on the Implementation of
health and safety, there must be a certification from an Compressed Workweek. As provided in the MOA, 8:00 a.m.
to 6:12 p.m., from Monday to Friday, shall be considered as
accredited health and safety organization or practitioner
the regular working hours, and no overtime pay shall be due
or from the firm's safety committee that work beyond
and payable to the employee for work rendered during those
eight hours is within threshold limits or tolerable levels hours. The MOA specifically stated that the employee waives
of exposure, as set in the OSHS. the right to claim overtime pay for work rendered after 5:00
p.m. until 6:12 p.m. from Monday to Friday considering that
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the compressed workweek schedule is adopted in lieu of the (1) A woman who gives birth as a result of prolonged absence of the parents or solo
regular workweek schedule which also consists of 46 hours. rape and other crimes against chastity even parent.
However, should an employee be permitted or required to without a final conviction of the
work beyond 6:12 p.m., such employee shall be entitled to offender: Provided, That the mother keeps
A change in the status or circumstance of the
overtime pay. and raises the child;
parent claiming benefits under this Act, such
that he/she is no longer left alone with the
Finally, we do not agree with the petitioners
(2) Parent left solo or alone with the responsibility of parenthood, shall terminate
assertion that the MOA is not enforceable as it is contrary to
responsibility of parenthood due to death of his/her eligibility for these benefits.
law. The MOA is enforceable and binding against the
spouse;
petitioners. Where it is shown that the person making the
waiver did so voluntarily, with full understanding of what he (e) "Flexible work schedule" - is the right granted to a
was doing, and the consideration for the quitclaim is credible (3) Parent left solo or alone with the solo parent employee to vary his/her arrival and
and reasonable, the transaction must be recognized as a valid responsibility of parenthood while the spouse departure time without affecting the core work hours as
and binding undertaking.[27] is detained or is serving sentence for a defined by the employer.
criminal conviction for at least one (1) year;

PESALA v. NLRC,[28] cited by the petitioners, is not Section 6. Flexible Work Schedule. - The employer shall
applicable to the present case. In that case, an employment (4) Parent left solo or alone with the provide for a flexible working schedule for solo parents:
responsibility of parenthood due to physical Provided, That the same shall not affect individual and
contract provided that the workday consists of 12 hours and
the employee will be paid a fixed monthly salary rate that was and/or mental incapacity of spouse as company productivity:
above the legal minimum wage. certified by a public medical practitioner;
However, unlike the present MOA which specifically Provided, further, That any employer may request exemption
states that the employee waives his right to claim overtime (5) Parent left solo or alone with the from the above requirements from the DOLE on certain
pay for work rendered beyond eight hours, the employment responsibility of parenthood due to legal meritorious grounds.
contract in that case was silent on whether overtime pay was separation or de facto separation from
included in the payment of the fixed monthly salary. spouse for at least one (1) year, as long as
This necessitated the interpretation by the Court as he/she is entrusted with the custody of the
to whether the fixed monthly rate provided under the children;
employment contract included overtime pay. q. Rest days and holidays
The Court noted that if the employee is paid only 1. Rest day
the minimum wage but with overtime pay, the amount is still (6) Parent left solo or alone with the
2. Compulsory work on rest
greater than the fixed monthly rate as provided in the responsibility of parenthood due to
declaration of nullity or annulment of marriage day
employment contract. It, therefore, held that overtime pay was
not included in the agreed fixed monthly rate. as decreed by a court or by a church as long
as he/she is entrusted with the custody of the Chapter II
Considering that the MOA clearly states that the children; WEEKLY REST PERIODS
employee waives the payment of overtime pay in exchange of
a five-day workweek, there is no room for interpretation and (7) Parent left solo or alone with the Article 91. Right to weekly rest day.
its terms should be implemented as they are written. responsibility of parenthood due to
abandonment of spouse for at least one (1)
year; It shall be the duty of every employer, whether operating for
p. Flexible work hours for solo parents profit or not, to provide each of his employees a rest period
of not less than twenty-four (24) consecutive hours after
(8) Unmarried mother/father who has every six (6) consecutive normal work days.
REPUBLIC ACT NO. 8972
preferred to keep and rear her/his
AN ACT PROVIDING FOR BENEFITS child/children instead of having others care
AND PRIVILEGES TO SOLO PARENTS for them or give them up to a welfare The employer shall determine and schedule the weekly rest
AND THEIR CHILDREN, institution; day of his employees subject to collective bargaining
APPROPRIATING FUNDS THEREFOR agreement and to such rules and regulations as the
AND FOR OTHER PURPOSES Secretary of Labor and Employment may provide. However,
(9) Any other person who solely provides the employer shall respect the preference of employees as
parental care and support to a child or to their weekly rest day when such preference is based on
children; religious grounds.
Section 3. Definition of Terms. - Whenever used in this Act,
the following terms shall mean as follows: (10) Any family member who assumes the Article 92. When employer may require work on a rest
responsibility of head of family as a result of day. The employer may require his employees to work on
(a) "Solo parent" - any individual who falls under any of the death, abandonment, disappearance or any day:
the following categories:
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(a) In case of actual or impending emergencies caused by Every worker shall be paid his regular daily wage during RULE IV
serious accident, fire, flood, typhoon, earthquake, regular holidays, except in retail and service Holidays with Pay
epidemic or other disaster or calamity to prevent loss of establishments regularly employing less than ten (10)
life and property, or imminent danger to public safety; workers;
SECTION 1. Coverage. — This rule shall apply to all
(b) In cases of urgent work to be performed on the
employees except:
machinery, equipment, or installation, to avoid serious
The employer may require an employee to work on any
loss which the employer would otherwise suffer;
holiday but such employee shall be paid a compensation
(c) In the event of abnormal pressure of work due to (a) Those of the government and any of the political
equivalent to twice his regular rate; and
special circumstances, where the employer cannot subdivision, including government-owned and
ordinarily be expected to resort to other measures; controlled corporation;
(d) To prevent loss or damage to perishable goods; (a) As used in this Article, "holiday" includes:
(e) Where the nature of the work requires continuous (b) New Year’s Day,
(b) Those of retail and service establishments regularly
operations and the stoppage of work may result in (c) Maundy Thursday,
irreparable injury or loss to the employer; and employing less than ten (10) workers;
(d) Good Friday,
(f) Under other circumstances analogous or similar to the (e) the ninth of April, Araw ng Kagitingan
foregoing as determined by the Secretary of Labor and (f) the first of May, (c) Domestic helpers and persons in the personal
Employment. (g) the twelfth of June, Independence day service of another;
(h) the fourth of July,
(i) the thirtieth of November,
Article 93. Compensation for rest day, Sunday or holiday (d) Managerial employees as defined in Book Three of
(j) the twenty-fifth and thirtieth of December and
work. the Code;
(k) the day designated by law for holding a general
election.
Where an employee is made or permitted to work on his (e) Field personnel and other employees whose time and
scheduled rest day, he shall be paid an additional performance is unsupervised by the employer including
Article 95. Right to service incentive leave.
compensation of at least thirty percent (30%) of his regular those who are engaged on task or contract basis, purely
wage. An employee shall be entitled to such additional commission basis, or those who are paid a fixed amount for
compensation for work performed on Sunday only when it is Every employee who has rendered at least one year of performing work irrespective of the time consumed in the
his established rest day. service shall be entitled to a yearly service incentive leave of performance thereof.cralaw
five days with pay.
When the nature of the work of the employee is such that he SECTION 2. Status of employees paid by the month. —
has no regular workdays and no regular rest days can be This provision shall not apply to those who are already Employees who are uniformly paid by the month, irrespective
scheduled, he shall be paid an additional compensation of at enjoying the benefit herein provided, those enjoying vacation of the number of working days therein, with a salary of not
least thirty percent (30%) of his regular wage for work leave with pay of at least five days and those employed in less than the statutory or established minimum wage shall be
performed on Sundays and holidays. establishments regularly employing less than ten employees paid for all days in the month whether worked or not.cralaw
or in establishments exempted from granting this benefit by
the Secretary of Labor and Employment after considering the
Work performed on any special holiday shall be paid an For this purpose, the monthly minimum wage shall not be
viability or financial condition of such establishment.
additional compensation of at least thirty percent (30%) of less than the statutory minimum wage multiplied by 365 days
the regular wage of the employee. Where such holiday work divided by twelve.cralaw
falls on the employee’s scheduled rest day, he shall be The grant of benefit in excess of that provided herein shall
entitled to an additional compensation of at least fifty per not be made a subject of arbitration or any court or
cent (50%) of his regular wage. SECTION 3. Holiday Pay. — Every employer shall pay his
administrative action.
employees their regular daily wage for any worked regular
holidays.cralaw
Where the collective bargaining agreement or other Article 96. Service charges. All service charges collected by
applicable employment contract stipulates the payment of a hotels, restaurants and similar establishments shall be
higher premium pay than that prescribed under this Article, distributed at the rate of eighty-five percent (85%) for all As used in the rule, the term 'regular holiday' shall
the employer shall pay such higher rate. covered employees and fifteen percent (15%) for exclusively refer to:
management. The share of the employees shall be equally
distributed among them. In case the service charge is (a) New Year's Day,
Chapter III
abolished, the share of the covered employees shall be (b) Maundy Thursday,
HOLIDAYS, SERVICE INCENTIVE LEAVES AND
considered integrated in their wages. (c) Good Friday,
SERVICE CHARGES
(d) the ninth of April,
(e) the first of May,
Article 94. Right to holiday pay. (f) the twelfth of June,
Rule IV, Book III, Omnibus Rules (g) the last Sunday of August,
(h) the thirtieth of November,
(i) the twenty-fifth and thirtieth of December.
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(j) Nationwide special days shall include the first of were declared national holidays to afford Filipinos with a lt is readily apparent that the declared purpose of the holiday
November and the last day of December.cralaw recurring opportunity to commemorate the heroism of the pay which is the prevention of diminution of the monthly
Filipino people, promote national identity, and deepen the income of the employees on account of work interruptions is
spirit of patriotism. defeated when a regular class day is cancelled on account of
As used in this Rule legal or regular holiday and special
a special public holiday and class hours are held on another
holiday shall now be referred to as 'regular holiday' and
working day to make up for time lost in the school calendar.
'special day', respectively.cralaw Labor Day (May 1) is a day traditionally reserved to celebrate
Otherwise stated, the faculty member, although forced to take
the contributions of the working class to the development of
a rest, does not earn what he should earn on that day. Be it
the nation, while the religious holidays designated in
SECTION 4. Compensation for holiday work. — Any noted that when a special public holiday is declared, the
Executive Order No. 203 allow the worker to celebrate his
employee who is permitted or suffered to work on any faculty member paid by the hour is deprived of expected
faith with his family.
regular holiday, not exceeding eight (8) hours, shall be paid income, and it does not matter that the school calendar is
at least two hundred percent (200%) of his regular daily extended in view of the days or hours lost, for their income
wage. If the holiday work falls on the scheduled rest day of As reflected above, Art. 94 of the Labor Code, as amended, that could be earned from other sources is lost during the
the employee, he shall be entitled to an additional premium affords a worker the enjoyment of ten paid regular extended days. Similarly, when classes are called off or
pay of at least 30% of his regular holiday rate of 200% based holidays.9 The provision is mandatory,10 regardless of shortened on account of typhoons, floods, rallies, and the like,
on his regular wage rate.cralaw whether an employee is paid on a monthly or daily basis.11 these faculty members must likewise be paid, whether or not
extensions are ordered.
SECTION 5. Overtime pay for holiday work. — For work Unlike a bonus, which is a management 5. Muslim holidays
performed in excess of eight hours on a regular holiday, an prerogative,12 holiday pay is a statutory benefit demandable
employee shall be paid an additional compensation for the under the law. Since a worker is entitled to the enjoyment of
overtime work equivalent to his rate for the first eight hours ten paid regular holidays, the fact that two holidays fall on
on such holiday work plus at least 30% thereof.cralaw the same date should not operate to reduce to nine the ten San Miguel Corp v CA, 146775 (2002)
holiday pay benefits a worker is entitled to receive.
Where the regular holiday work exceeding eight hours falls
on the scheduled rest day of the employee, he shall be paid It is elementary, under the rules of statutory construction,
Petitioner asserts that Article 3(3) of Presidential Decree No.
an additional compensation for the overtime work equivalent that when the language of the law is clear and unequivocal,
1083 provides that "(t)he provisions of this Code shall be
to his regular holiday-rest day for the first 8 hours plus 30% the law must be taken to mean exactly what it says.13 In the
applicable only to Muslims x x x." However, there should be
thereof. The regular holiday rest day rate of an employee case at bar, there is nothing in the law which provides or
no distinction between Muslims and non-Muslims as regards
shall consist of 200% of his regular daily wage rate plus 30% indicates that the entitlement to ten days of holiday pay shall
payment of benefits for Muslim holidays. The Court of
thereof be reduced to nine when two holidays fall on the same day.
Appeals did not err in sustaining Undersecretary Español
who stated:
4. Teachers paid by the hour
Assuming arguendo that the respondent’s position is
correct, then by the same token, Muslims throughout
the Philippines are also not entitled to holiday pays on
3. Regular v special holiday Jose Rizal College v NLRC, L-65482 Christian holidays declared by law as regular holidays.
i. Rationale/Entitlement; (1987) We must remind the respondent-appellant that wages
and other emoluments granted by law to the working
2 Regular holidays man are determined on the basis of the criteria laid
down by laws and certainly not on the basis of the
JOSE RIZAL COLLEGE V. NLRC worker’s faith or religion.
ISSUE: W/N the school faculty who according to their
Asian Transmission Corp v CA, 144644 contracts are paid per lecture hour are entitled to unworked
holiday pay. [Depends on the holiday] At any rate, Article 3(3) of Presidential Decree No. 1083 also
(2004) declares that "x x x nothing herein shall be construed to
HELD: operate to the prejudice of a non-Muslim."
Regular unworked holidays→ NOT ENTITLED TO
(a) Independence Day (June 12),
COMPENSATION. In addition, the 1999 Handbook on Workers’ Statutory
Regular holidays specified as such by law are known to both Benefits, approved by then DOLE Secretary Bienvenido E.
(b) Araw ng Kagitingan (April 9),
school and faculty members as "no class days;" certainly the Laguesma on 14 December 1999 categorically stated:
(c) National Heroes Day (last Sunday of August),
latter do not expect payment for said unworked days, and this
(d) Bonifacio Day (November 30) and
was clearly in their minds when they entered into the teaching
(e) Rizal Day (December 30) Considering that all private corporations, offices, agencies,
contracts.
and entities or establishments operating within the
SPECIAL HOLIDAYS→ ENTITLED TO PAY designated Muslim provinces and cities are required to
observe Muslim holidays, both Muslim and Christians
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working within the Muslim areas may not report for work continuous or broken reckoned from the date the employee incentive leave pay in favor of respondent, in accordance
on the days designated by law as Muslim holidays.9 started working, including authorized absences and paid with the finding of the CA that respondent was a regular
regular holidays unless the working days in the establishment employee of petitioner and is, therefore, entitled to such
as a matter of practice or policy, or that provided in the benefit. As the CA aptly pointed out:
employment contracts, is less than 12 months, in which case
said period shall be considered as one year. [40] It is also [R]espondent is not a field personnel as defined above
r. Service incentive leave
commutable to its money equivalent if not used or exhausted because of the nature of his job as a company driver.
at the end of the year.[41] In other words, an employee who has
Expectedly, respondent is directed to deliver the goods at a
served for one year is entitled to it.
specified time and place and he is not given the discretion to
Labor Code He may use it as leave days or he may collect its solicit, select[,] and contact prospective clients.
monetary value. To limit the award to three years, as the Respondent in his Position Paper claimed that he was
solicitor general recommends, is to unduly restrict such required to report for work from 8:00 a.m. to 8:00 p.m. at the
right. The law indeed does not prohibit its commutation. company's store located at Velez-Gomez Street, Cagayan de
Article 95. Right to service incentive leave. Oro City. Certainly then, respondent was under the control
Moreover, the solicitor generals recommendation is
and supervision of petitioners. Respondent, therefore, is a
contrary to the ruling of the Court in Bustamante et al. vs.
Every employee who has rendered at least one year of regular employee whose task is usually necessary and
NLRC et al.[42] lifting the three-year restriction on the amount
service shall be entitled to a yearly service incentive leave of desirable to the usual trade and business of the company.
of backwages and other allowances that may be awarded an
five days with pay. Thus, he is entitled to the benefits accorded to regular
illegally dismissed employee, thus:
employees, including service incentive leave
pay.72chanroblesvirtuallawlibrary
This provision shall not apply to Therefore, in accordance with R.A. No. 6715, petitioners are
The Court has already held that company drivers who are
entitled to their full backwages, inclusive of allowances and
other benefits or their monetary equivalent, from the time under the control and supervision of management
(a) those who are already enjoying the benefit herein officers — like respondent herein — are regular
provided, their actual compensation was withheld from them up to the
time of their actual reinstatement. (Underscoring supplied.) employees entitled to benefits including service
(b) those enjoying vacation leave with pay of at least five
incentive leave pay.73
days
(c) and those employed in establishments regularly Since a service incentive leave is clearly demandable Petitioner, as the employer of respondent, and having
employing less than ten employees or after one year of service -- whether continuous or broken -- or
(d) in establishments exempted from granting this benefit complete control over the records of the company, could
its equivalent period, and it is one of the benefits which would
by the Secretary of Labor and Employment after have easily rebutted the said monetary claim against it by
have accrued if an employee was not otherwise illegally
considering the viability or financial condition of such presenting the vouchers or payrolls showing payment of the
dismissed, it is fair and legal that its computation should be up
establishment. to the date of reinstatement as provided under Section 279 of same. However, since petitioner opted not to lift a finger in
the Labor Code, as amended, which reads: providing the required documentary evidence, the ineluctable
conclusion that may be derived therefrom is that it never paid
The grant of benefit in excess of that provided herein shall
said benefit and must, perforce, be ordered to settle its
not be made a subject of arbitration or any court or ART. 279. Security of Tenure. -- An employee who is
administrative action. obligation to respondent.
unjustly dismissed from work shall be entitled to
reinstatement without loss of seniority rights and other
privileges and to his full backwages, inclusive of allowances,
and to his other benefits or their monetary 2. Employees not entitled
1. When demandable: Computation equivalent computed from the time his compensation is
withheld from him up to the time of his actual
G.R. No. 195466 July 2, 2014
reinstatement. (underscoring supplied).
ARIEL L. DAVID, doing business under
the name and style "YIELS HOG
Fernandez v NLRC, G.R. No. DEALER," Petitioner,
105892. January 28, 1998 vs.
JOHN G. MACASIO, Respondent
G.R. No. 219569, August 17, 2016
HSY MARKETING LTD.,
Is there a limit to the amount of service incentive leave pay CO.,* Petitioner, v. VIRGILIO O.
and backwages that may be awarded to an illegally VILLASTIQUE, Respondent. The issue revolves around the proper application and
dismissed employee? interpretation of the labor law provisions on holiday, SIL and
13th month pay to a worker engaged on "pakyaw" or task
Service incentive leave is a right which accrues to every While petitioner should not be adjudged liable for separation basis
employee who has served within 12 months, whether pay, the Court nonetheless sustains the award of service
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In short, in determining whether workers engaged on Thus, as properly held by the Court of Appeals and by the The issue is whether petitioners are liable to pay
"pakyaw" or task basis" is entitled to holiday and SIL pay, the NLRC, private respondents are entitled to the 13th month pay the tips to Orlando.
presence (or absence) of employer supervision as regards and service incentive leave pay.
the worker’s time and performance is the key: The word [tip] has several meanings, with origins
However, the Court disagrees with the Court of Appeals ruling more or less obscure, connected with "tap" and with
that the 13th month pay and service incentive leave pay should "top."
if the worker is simply engaged on pakyaw or task basis,
be computed from the start of employment up to the finality of
then the general rule is that he is entitled to a holiday pay In the sense of a sum of money given for good
the NLRC resolution.
and SIL pay unless exempted from the exceptions service, other languages are more specific, e.g., Fr.
specifically provided under Article 94 (holiday pay) and pourboire, for drink. It is suggested that [the word] is
While computation for the 13th month pay should properly
Article95 (SIL pay) of the Labor Code. formed from the practice, in early 18th c. London
begin from the first day of employment, the service incentive
leave pay should start a year after commencement of service, coffeehouses, of having a box in which persons in a
hurry would drop a small coin, to gain immediate
However, if the worker engaged on pakyaw or task basis for it is only then that the employee is entitled to said benefit.
attention. The box was labelled To Insure Promptness;
also falls within the meaning of "field personnel" under the
On the other hand, the computation for both benefits should then just with the initials T.I.P.[22]
law, then he is not entitled to these monetary benefits.
only be up to 15 August 1996, or the last day that private It is more frequently used to indicate additional
respondents worked for JPL. To extend the period to the date compensation, and in this sense "tip" is defined as
Based on the definition of field personnel under Article 82, of finality of the NLRC resolution would negate the absence of
we agree with the CA that Macasio does not fall under the meaning a gratuity; a gift; a present; a fee; money
illegal dismissal, or to be more precise, the want of dismissal given, as to a servant to secure better or more prompt
definition of "field personnel." The CA’s finding in this regard in this case. Besides, it would be unfair to require JPL to pay
is supported by the established facts of this case: first, service.
private respondents the said benefits beyond 15 August 1996
Macasio regularly performed his duties at David’s principal
when they did not render any service to JPL beyond that date. A tip may range from pure gift out of
place of business; second, his actual hours of work could be
benevolence or friendship, to a compensation for a
determined with reasonable certainty; and, third, David These benefits are given by law on the basis of the service
supervised his time and performance of duties. Since service measured by its supposed value but not fixed
actually rendered by the employee, and in the particular case by an agreement, although usually the word is applied
Macasio cannot be considered a "field personnel," then he is of the service incentive leave, is granted as a motivation for to what is paid to a servant in addition to the regular
not exempted from the grant of holiday, SIL pay even as he the employee to stay longer with the employer. There is no compensation for his service in order to secure better
was engaged on "pakyaw" or task basis. cause for granting said incentive to one who has already service or in recognition of it.
terminated his relationship with the employer.
Not being a "field personnel," we find the CA to be legally It has been said that a tip denotes a voluntary
correct when it reversed the NLRC’s ruling dismissing act, but it also has been said that from the very
Macasio’s complaint for holiday and SIL pay for having been s. Service charges; tips beginning of the practice of tipping it was evident that,
rendered with grave abuse of discretion. whether considered from the standpoint of the giver or
the recipient, a tip lacked the essential element of a
gift, namely, the free bestowing of a gratuity without a
3. At least one year of service; consideration, and that, despite its apparent
Labor code
reckoning period voluntariness, there is an element of compulsion in
tipping.[23]

Tipping is done to get the attention and secure


Article 96. Service charges. All service charges collected by the immediate services of a waiter, porter or others for
JPL Marketing Promotions v CA, 151966 hotels, restaurants and similar establishments shall be
(2005) their services.
distributed at the rate of eighty-five percent (85%) for all
covered employees and fifteen percent (15%) for Since a tip is considered a pure gift out of
management. benevolence or friendship, it can not be demanded
from the customer. Whether or not tips will be given is
The share of the employees shall be equally distributed dependent on the will and generosity of the giver.
Admittedly, private respondents were not given their Although a customer may give a tip as a consideration
13th month pay and service incentive leave pay while they among them.
for services rendered, its value still depends on the
were under the employ of JPL. Instead, JPL provided salaries giver. They are given in addition to the compensation
which were over and above the minimum wage. In case the service charge is abolished, the share of the by the employer. A gratuity given by an employer in
covered employees shall be considered integrated in their order to inspire the employee to exert more effort in his
The Court rules that the difference between the minimum wages. work is more appropriately called a bonus.
wage and the actual salary received by private respondents
cannot be deemed as their 13th month pay and service The NLRC and the Court of Appeals held that
incentive leave pay as such difference is not equivalent to or petitioners were liable to pay tips to Orlando because
of the same import as the said benefits contemplated by law. Ace Navigation v CA, 140364 (2000) of the contract of employment. Thus:

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"The contract of employment entered into by and between Furthermore, it is presumed that the parties were charges on certain specified transactions), Article 96
the complainant and Ace Navigation Co., Inc. (p. 82, Record) aware of the plain, ordinary and common meaning of will not operate.
clearly provides xxx: the word "tip." As a bartender, Orlando can not feign
ignorance on the practice of tipping and that tips are In this case, the CA found that the PPHI had not in fact
normally paid by customers and not by the employer. been collecting services charges on the specified
'That the employee shall be employed on board under the
entries/transactions that we pointed out as either
following terms and conditions: It is also absurd that petitioners intended to give falling under “negotiated contracts” and/or “special
Orlando a salary higher than that of the ship captain. rates” or did not involve a “sale of food, beverage,
1.1 Duration of Contract: (12 months) 10 months As petitioners point out, the captain of M/V "Orient etc.” Accordingly, Article 96 of the Labor Code finds
remaining duration of contract Princess" receives US$3,000.00 per month while no application in this case; the PPHI did not abolish or
Orlando will receive US$3,450.00 per month if the tip terminate the implementation of any company policy
of US$2.00 per passenger per day will be given in providing for the collection of service charges on
1.2 Position: Bartender addition to his US$450.00 monthly salary. It will be specified entries/transactions that could have
against common sense for an employer to give a lower otherwise rendered it liable to pay an amount
1.3 Basic Monthly Salary: U.S.$450.00 Flat rate ranked employee a higher compensation than an representing the covered employees’ share in the
including overtime pay for employee who holds the highest position in an alleged abolished service charges.
enterprise.

1.4 Hours of Work: 12 hrs. work daily.


E. Wages/Salary
1.5 Overtime: Plus tips of U.S.$2.00 per passenger G.R. No. 177524, July 23, 2014
per day. NATIONAL UNION OF WORKERS IN
HOTEL RESTAURANT AND ALLIED
1.6 Vacation Leave with Pay: 2.5 days/mo.' (record, p. Labor Code
INDUSTRIES (NUWHRAIN-APL-IUF),
82) PHILIPPINE PLAZA
CHAPTER, Petitioner, v. PHILIPPINE
We disagree. The contract of employment PLAZA HOLDINGS, INC., Respondent.
Title II
between petitioners and Orlando is categorical that the WAGES
monthly salary of Orlando is US$450.00 flat rate. This
already included his overtime pay which is integrated
in his 12 hours of work. The words "plus tips of Chapter I
US$2.00 per passenger per day" were written at the The PPHI did not violate Article 96 of the PRELIMINARY MATTERS
line for overtime. Since payment for overtime was Labor Code when they refused the Union’s
included in the monthly salary of Orlando, the claim for service charges on the
specified entries/transactions Article 97. Definitions. As used in this Title:
supposed tips mentioned in the contract should be
deemed included thereat.
Article 96 of the Labor Code provides for the minimum "Person" means an individual, partnership, association,
The actuations of Orlando during his percentage distribution between the employer and the corporation, business trust, legal representatives, or any
employment also show that he was aware his monthly employees of the collected service charges, and its organized group of persons.
salary is only US$450.00, no more no less. He did not integration in the covered employees’ wages in the event the
raise any complaint about the non-payment of his tips employer terminates its policy of providing for its
during the entire duration of his employment. After the collection. It pertinently reads: "Employer" includes any person acting directly or indirectly in
expiration of his contract, he demanded payment only the interest of an employer in relation to an employee and
of his vacation leave pay. shall include the government and all its branches,
subdivisions and instrumentalities, all government-owned or
He did not immediately seek the payment of tips. This last paragraph of Article 96 of the Labor Code controlled corporations and institutions, as well as non-profit
He only asked for the payment of tips when he filed this presumes the practice of collecting service charges private institutions, or organizations.
case before the labor arbiter. and the employer’s termination of this practice. When
this happens, Article 96 requires the employer to
"Employee" includes any individual employed by an
This shows that the alleged non-payment of tips incorporate the amount that the employees had been
employer.
was a mere afterthought to bloat up his claim. The receiving as share of the collected service charges into
records of the case do not show that Orlando was their wages.
deprived of any monthly salary. It will now be unjust to "Agriculture" includes farming in all its branches and, among
impose a burden on the employer who performed the In cases where no service charges had other things, includes cultivation and tillage of soil, dairying,
contract in good faith. previously been collected (as where the employer the production, cultivation, growing and harvesting of any
never had any policy providing for collection of service agricultural and horticultural commodities, the raising of
charges or had never imposed the collection of service livestock or poultry, and any practices performed by a farmer
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on a farm as an incident to or in conjunction with such Article 102. Forms of payment. No employer shall pay the 2. Where the worker has died, in which case,
farming operations, but does not include the manufacturing wages of an employee by means of promissory notes, a. the employer may pay the wages of the
or processing of sugar, coconuts, abaca, tobacco, vouchers, coupons, tokens, tickets, chits, or any object other deceased worker to the heirs of the latter
pineapples or other farm products. than legal tender, even when expressly requested by the without the necessity of intestate
employee. proceedings.
b. The claimants, if they are all of age, shall
"Employ" includes to suffer or permit to work.
execute an affidavit
Payment of wages by check or money order shall be allowed
i. attesting to their relationship to the
when such manner of payment is customary on the date of
"Wage" paid to any employee shall mean the remuneration deceased and the fact that they are
effectivity of this Code, or is necessary because of special
or earnings, however designated, capable of being his heirs, to the exclusion of all
circumstances as specified in appropriate regulations to be
expressed in terms of money, whether fixed or ascertained other persons. If any of the heirs is
issued by the Secretary of Labor and Employment or as
on a time, task, piece, or commission basis, or other method a minor,
stipulated in a collective bargaining agreement.
of calculating the same, which is payable by an employer to ii. the affidavit shall be executed on
an employee under a written or unwritten contract of his behalf by his natural guardian
employment for work done or to be done, or for services Article 103. Time of payment. Wages shall be paid at least or next-of-kin.
rendered or to be rendered and includes the fair and once every two (2) weeks or twice a month at intervals not iii. The affidavit shall be presented to
reasonable value, as determined by the Secretary of Labor exceeding sixteen (16) days. the employer who shall make
and Employment, of board, lodging, or other facilities payment through the Secretary of
customarily furnished by the employer to the employee. "Fair Labor and Employment or his
If on account of force majeure or circumstances beyond the representative.
and reasonable value" shall not include any profit to the
employer’s control, payment of wages on or within the time c. The representative of the Secretary of Labor
employer, or to any person affiliated with the employer.
herein provided cannot be made, the employer shall pay the
and Employment shall act as referee in
wages immediately after such force majeure or dividing the amount paid among the heirs.
Article 98. Application of Title. This Title shall not apply to circumstances have ceased. No employer shall make d. The payment of wages under this Article shall
farm tenancy or leasehold, domestic service and persons payment with less frequency than once a month. absolve the employer of any further liability
working in their respective homes in needle work or in any
with respect to the amount paid.
cottage industry duly registered in accordance with law.
The payment of wages of employees engaged to perform a
task which cannot be completed in two (2) weeks shall be Article 110. Worker preference in case of bankruptcy. In the
Chapter II subject to the following conditions, in the absence of a event of bankruptcy or liquidation of an employer’s business,
MINIMUM WAGE RATES collective bargaining agreement or arbitration award: his workers shall enjoy first preference as regards their
wages and other monetary claims, any provisions of law to
Article 99. Regional minimum wages. The minimum wage That payments are made at intervals not exceeding sixteen the contrary notwithstanding. Such unpaid wages and
rates for agricultural and non-agricultural employees and (16) days, in proportion to the amount of work completed; monetary claims shall be paid in full before claims of the
workers in each and every region of the country shall be government and other creditors may be paid. (As amended
those prescribed by the Regional Tripartite Wages and by Section 1, Republic Act No. 6715, March 21, 1989)
That final settlement is made upon completion of the work.
Productivity Boards. (As amended by Section 3, Republic
Act No. 6727, June 9, 1989).
Article 111. Attorney’s fees.
Article 104. Place of payment. Payment of wages shall be
made at or near the place of undertaking, except as
Article 100. Prohibition against elimination or diminution of
otherwise provided by such regulations as the Secretary of In cases of unlawful withholding of wages, the culpable party
benefits. Nothing in this Book shall be construed to eliminate may be assessed attorney’s fees equivalent to ten percent of
Labor and Employment may prescribe under conditions to
or in any way diminish supplements, or other employee the amount of wages recovered.
ensure greater protection of wages.
benefits being enjoyed at the time of promulgation of this
Code.
Article 105. Direct payment of wages. Wages shall be paid It shall be unlawful for any person to demand or accept, in
directly to the workers to whom they are due, except: any judicial or administrative proceedings for the recovery of
Article 101. Payment by results. wages, attorney’s fees which exceed ten percent of the
amount of wages recovered.
1. In cases of force majeure
The Secretary of Labor and Employment shall regulate the
a. rendering such payment impossible or under
payment of wages by results, including pakyao, piecework,
other special circumstances Chapter IV
and other non-time work, in order to ensure the payment of
b. to be determined by the Secretary of Labor PROHIBITIONS REGARDING WAGES
fair and reasonable wage rates, preferably through time and
and Employment in appropriate regulations,
motion studies or in consultation with representatives of
in which case,
workers’ and employers’ organizations. Article 112. Non-interference in disposal of wages.
c. the worker may be paid through another
person
Chapter III d. under written authority given by the worker for 1. No employer shall limit or otherwise interfere with the
PAYMENT OF WAGES the purpose; or freedom of any employee to dispose of his wages.
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2. He shall not force, stealth, intimidation, threat or by any other means Article 124. Standards/Criteria for minimum wage fixing. The
a. in any manner force, compel, or oblige his whatsoever without the worker’s consent. regional minimum wages to be established by the Regional
employees to purchase merchandise, Board shall be as nearly adequate as is economically
commodities or other property from any other feasible to maintain the minimum standards of living
Article 117. Deduction to ensure employment. It shall be
person, necessary for the health, efficiency and general well-being of
unlawful to make any deduction from the wages of any
b. or otherwise make use of any store or the employees within the framework of the national
employee for the benefit of the employer or his
services of such employer or any other economic and social development program.
representative or intermediary as consideration of a promise
person.
of employment or retention in employment.
In the determination of such regional minimum wages,
Article 113. Wage deduction. the Regional Board shall, among other relevant factors,
Article 118. Retaliatory measures. It shall be unlawful for an
consider the following:
employer to refuse to pay or reduce the wages and benefits,
No employer, in his own behalf or in behalf of any person, discharge or in any manner discriminate against any
shall make any deduction from the wages of his employees, employee who has filed any complaint or instituted any 1. The demand for living wages;
except: proceeding under this Title or has testified or is about to 2. Wage adjustment vis-à-vis the consumer price index;
testify in such proceedings. 3. The cost of living and changes or increases therein;
4. The needs of workers and their families;
1. In cases where the worker is insured with his consent
5. The need to induce industries to invest in the
by the employer, and the deduction is to recompense Article 119. False reporting. It shall be unlawful for any
countryside;
the employer for the amount paid by him as premium on person to make any statement, report, or record filed or kept
6. Improvements in standards of living;
the insurance; pursuant to the provisions of this Code knowing such
7. The prevailing wage levels;
2. For union dues, in cases where the right of the worker statement, report or record to be false in any material respec
8. Fair return of the capital invested and capacity to pay of
or his union to check-off has been recognized by the
employers;
employer or authorized in writing by the individual
Article 123. Wage Order. 9. Effects on employment generation and family income;
worker concerned; and
and
3. In cases where the employer is authorized by law or
10. The equitable distribution of income and wealth along
regulations issued by the Secretary of Labor and 1. Whenever conditions in the region so warrant,
the imperatives of economic and social development.
Employment. 2. the Regional Board shall investigate and study all
pertinent facts;
3. and based on the standards and criteria herein The wages prescribed in accordance with the provisions of
Article 114. Deposits for loss or damage.
prescribed, this Title shall be the standard prevailing minimum wages in
4. shall proceed to determine whether a Wage Order every region.
No employer shall require his worker to make deposits from should be issued.
which deductions shall be made for the reimbursement of 5. Any such Wage Order shall take effect after fifteen (15)
These wages shall include wages varying with industries,
loss of or damage to tools, materials, or equipment supplied days from its complete publication in at least one (1)
provinces or localities if in the judgment of the Regional
by the employer, newspaper of general circulation in the region.
Board, conditions make such local differentiation proper and
necessary to effectuate the purpose of this Title.
except when : In the performance of its wage-determining functions, the
Regional Board shall conduct public hearings/consultations,
xxxx
giving notices to employees’ and employers’ groups,
1. the employer is engaged in such trades, occupations or
provincial, city and municipal officials and other interested
business where the practice of making deductions or
parties. Where the application of any prescribed wage increase by
requiring deposits is a recognized one,
virtue of a law or wage order issued by any Regional Board
2. or is necessary or desirable as determined by the
results in distortions of the wage structure within an
Secretary of Labor and Employment in appropriate 1. Any party aggrieved by the Wage Order issued by the
establishment, the employer and the union shall negotiate to
rules and regulations. Regional Board may appeal such order to the
correct the distortions.
Commission within ten (10) calendar days from the
publication of such order.
Article 115. Limitations. No deduction from the deposits of
2. It shall be mandatory for the Commission to decide Any dispute arising from wage distortions shall be
an employee for the actual amount of the loss or damage
such appeal within sixty (60) calendar days from the resolved through:
shall be made unless the employee has been heard thereon,
filing thereof.
and his responsibility has been clearly shown.
3. The filing of the appeal does not stay the order
1. the grievance procedure under their collective
4. unless the person appealing such order shall file with
bargaining agreement and,
Article 116. Withholding of wages and kickbacks the Commission, an undertaking
2. if it remains unresolved, through voluntary arbitration.
prohibited. It shall be unlawful for any person, directly or 5. with a surety or sureties
a. Unless otherwise agreed by the parties in
indirectly, to withhold any amount from the wages of a 6. satisfactory to the Commission for the payment to the
writing, such dispute shall be decided by the
worker or induce him to give up any part of his wages by employees affected by the order of the corresponding
voluntary arbitrators within ten (10) calendar
increase, in the event such order is affirmed.
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days from the time said dispute was referred issued by any court, tribunal or other entity against any Any decision or resolution of the Regional Director or hearing
to voluntary arbitration. proceedings before the Commission or the Regional Boards. officer pursuant to this provision may be appealed on the
3. In cases where there are no collective agreements or (As amended by Republic Act No. 6727, June 9, 1989) same grounds provided in Article 223 of this Code,
recognized labor unions, the employers and workers
shall endeavor to correct such distortions.
Article 127. Non-diminution of benefits. No wage order 1. within five (5) calendar days from receipt of a copy of
4. Any dispute arising therefrom shall be settled through
issued by any regional board shall provide for wage rates said decision or resolution,
the National Conciliation and Mediation Board and, if it
lower than the statutory minimum wage rates prescribed by 2. to the National Labor Relations Commission
remains unresolved after ten (10) calendar days of
Congress. (As amended by Republic Act No. 6727, June 9, 3. which shall resolve the appeal within ten (10) calendar
conciliation, shall be referred to the appropriate branch
1989) days from the submission of the last pleading required
of the National Labor Relations Commission (NLRC).
or allowed under its rules.
a. It shall be mandatory for the NLRC to conduct
continuous hearings and decide the dispute Article 129. Recovery of wages, simple money claims and
within twenty (20) calendar days from the other benefits. (ADJUDICATORY) The Secretary of Labor and Employment or his duly
time said dispute is submitted for compulsory authorized representative may supervise the payment of
arbitration. unpaid wages and other monetary claims and benefits,
1. Upon complaint of any interested party,
including legal interest, found owing to any employee or
2. the Regional Director of the Department of Labor and
househelper under this Code. (As amended by Section 2,
The pendency of a dispute arising from a wage distortion Employment or any of the duly authorized hearing
Republic Act No. 6715, March 21, 1989)
shall not in any way delay the applicability of any increase in officers of the Department is empowered,
prescribed wage rates pursuant to the provisions of law or 3. through summary proceeding and after due notice,
wage order. 4. to hear and decide any matter involving
a. the recovery of wages and other monetary
claims and benefits, Labor advisory payment of salaries
As used herein, a wage distortion shall mean through ATM
b. including legal interest, owing to an employee
or person employed in domestic or household
a. a situation where an increase in prescribed wage rates service or househelper under this Code,
b. results in the elimination or severe contraction of arising from employer-employee relations:
intentional quantitative differences in wage or salary Explanatory Bulletin issued by DOLE Secretary Leonardo
rates Quisumbing dated November 25, 1996). "labor advisory on
Exception: payment of salaries through atm- (sgd) leonardo
c. between and among employee groups in an
establishment quisumbing"
d. as to effectively obliterate the distinctions embodied in 1. Provided, That such complaint does not include a claim
such wage structure based on for reinstatement: A. Payment through automated teller machine (ATM) of
a. skills, 2. Provided further, That the aggregate money claims of banks provided the following conditions are met:
b. length of service, each employee or househelper does not exceed Five
c. or other logical bases of differentiation. thousand pesos (P5,000.00).
1. the ATM system of payment is with the written
consent of the employees concerned;
All workers paid by result, including those who are paid on The Regional Director or hearing officer shall decide or
piecework, takay, pakyaw or task basis, shall receive not resolve the complaint within thirty (30) calendar days from
less than the prescribed wage rates per eight (8) hours of the date of the filing of the same. 2. The employees are given reasonable time to
work a day, or a proportion thereof for working less than withdraw their wages from the bank facility which time,
eight (8) hours. if done during working hours, shall be considered
Any sum thus recovered on behalf of any employee or compensable hours worked;
househelper pursuant to this Article
All recognized learnership and apprenticeship agreements
shall be considered automatically modified insofar as their 3. The system shall allow workers to receive their
wage clauses are concerned to reflect the prescribed wage 1. shall be held in a special deposit account by, and shall wages within the period or frequency and in the amount
be paid on order of, the Secretary of Labor and prescribed under the Labor Code, as amended;
rates. (As amended by Republic Act No. 6727, June 9, 1989)
Employment or the Regional Director directly to the
employee or househelper concerned.
Article 125. Freedom to bargain. No wage order shall be 2. Any such sum not paid to the employee or househelper 4. There is a bank or ATM facility within a radius of one
construed to prevent workers in particular firms or because he cannot be located after diligent and (1) kilometer to the place of work;
enterprises or industries from bargaining for higher wages reasonable effort to locate him within a period of three
with their respective employers. (As amended by Republic (3) years, shall be held as a special fund of the 5. Upon request of the concerned employee/s, the
Act No. 6727, June 9, 1989) Department of Labor and Employment to be used employer shall issue a record of payment of wages,
exclusively for the amelioration and benefit of workers. benefits and deductions for a particular period;
Article 126. Prohibition against injunction. No preliminary or
permanent injunction or temporary restraining order may be
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6. There shall be no additional expenses and no LOPEZ, EDGARDO ZUÑIGA and furnished, the laborer would spend and pay for them just the
diminution of benefits and privileges as a result of the DANILO CAÑETE, Respondents. same.
ATM system of payment;
In short, the benefit or privilege given to the employee which
7. The employer shall assume responsibility in case the constitutes an extra remuneration above and over his basic
wage protection provisions of law and regulations are In such cases, the employer may deduct from the wages of or ordinary earning or wage is supplement;
not complied with under the arrangement the employees not more than 70% of the value of the meals
and snacks enjoyed by the latter, provided that such and when said benefit or privilege is part of the laborers'
1. No work, No pay deduction is with the written authorization of the employees basic wages, it is a facility.
concerned.
The distinction lies not so much in the kind of benefit or item
Moreover, before the value of facilities can be deducted from (food, lodging, bonus or sick leave) given, but in the purpose
Escario v NLRC, 160302 (2010) the employees’ wages, the following requisites must all be for which it is given.23 In the case at bench, the items
attendant: provided were given freely by SLL for the purpose of
maintaining the efficiency and health of its workers while
1. first, proof must be shown that such facilities are they were working at their respective projects.1avvphi1
customarily furnished by the trade;
That backwages are not granted to employees
2. second, the provision of deductible facilities must be
participating in an illegal strike simply accords with the reality
voluntarily accepted in writing by the employee; and
that they do not render work for the employer during the period Millares v NLRC, 122827 (1999)
3. finally, facilities must be charged at reasonable value.20
of the illegal strike.

The petitioners herein do not deny their participation in Mere availment is not sufficient to allow deductions from
the June 15, 1993 strike. As such, they did not suffer any loss employees’ wages.21 Specifically, "wage" is defined in letter (f) as the
of earnings during their absence from work. Their
remuneration or earnings, however designated, capable of
reinstatement sans backwages is in order, to conform to the
These requirements, however, have not been met in this being expressed in terms of money, whether fixed or
policy of a fair days wage for a fair days labor.
case. ascertained on a time, task, piece, or commission basis, or
other method of calculating the same, which is payable by
Under the principle of a fair days wage for a fair
an employer to an employee under a written or unwritten
days labor, the petitioners were not entitled to the wages 1. SLL failed to present any company policy or guideline contract of employment for work done or to be done, or for
during the period of the strike (even if the strike might be showing that provisions for meals and lodging were part services rendered or to berendered and includes the fair and
legal), because they performed no work during the strike. of the employee’s salaries. reasonable value, as determined by the Secretary of Labor, of
2. It also failed to provide proof of the employees’ written board, lodging, or other facilities customarily furnished by the
Verily, it was neither fair nor just that the dismissed authorization, much less show how they arrived at their employer to the employee.
employees should litigate against their employer on the latters valuations. At any rate, it is not even clear whether
[25]
time. Thus, the Court deleted the award of backwages and private respondents actually enjoyed said facilities. We invite attention to the above-underlined
held that the striking workers were entitled only to clause. Stated differently, when an employer customarily
reinstatement in Philippine Diamond Hotel and Resort, Inc. furnishes his employee board, lodging or other facilities, the
(Manila Diamond Hotel) v. Manila Diamond Hotel The Court, at this point, makes a distinction between
"facilities" and "supplements." It is of the view that the food fair and reasonable value thereof, as determined by the
Employees Union,[26] considering that the striking employees Secretary of Labor and Employment, is included in "wage."
did not render work for the employer during the strike. and lodging, or the electricity and water allegedly consumed
by private respondents in this case were not facilities but In order to ascertain whether the subject allowances
supplements. In the case of Atok-Big Wedge Assn. v. Atok- form part of petitioner's "wages," we divide the discussion on
2. Facilities v Supplement Big Wedge Co.,22 the two terms were distinguished from one the following –
another in this wise:
1. "customarily furnished;"
"Supplements," therefore, constitute extra remuneration or 2. "board, lodging or other facilities;" and,
G.R. No. 172161 March 2, 2011 special privileges or benefits given to or received by the
SLL INTERNATIONAL CABLES laborers over and above their ordinary earnings or wages. 3. "fair and reasonable value as determined by the
SPECIALIST and SONNY L. Secretary of Labor."
LAGON, Petitioners,
"Facilities," on the other hand, are items of expense
vs. "Customary" is founded on long-established and
necessary for the laborer's and his family's existence and
NATIONAL LABOR RELATIONS constant practice[13] connoting regularity.[14] The receipt of an
subsistence so that by express provision of law (Sec. 2[g]),
COMMISSION, 4th DIVISION, ROLDAN allowance on a monthly basis does not ipso facto characterize
they form part of the wage and when furnished by the
it as regular and forming part of salary[15] because the nature
employer are deductible therefrom, since if they are not so
of the grant is a factor worth considering. We agree with the
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observation of the Office of the Solicitor General- that the (a) It is for necessary travelling and representation or b. the provision of deductiblefacilities must be
subject allowances were temporarily, not regularly, received entertainment expenses paid or incurred by the employee in voluntarily accepted in writingby the employee; and
by petitioners because - the pursuit of the trade or business of the employer, and
c. The facilities must be charged at fair and reasonable
In the case of the housing allowance, once a vacancy occurs (b) The employee is required to, and does, make an value.40
in the company-provided housing accommodations, the accounting/liquidation for such expense in accordance with
employee concerned transfers to the company premises and the specific requirements of substantiation for such category
We examine Our Haus’ compliance with each of these
his housing allowance is discontinued x x x x or expense.
requirements in seriatim.

On the other hand, the transportation allowance is in the Board and lodging allowances furnished to an employee not
a. The facility must be customarily furnished by the trade
form of advances for actual transportation expenses subject in excess of the latter's needs and given free of charge,
to liquidation x x x given only to employees who have constitute income to the latter except if such allowances or
personal cars. benefits are furnished to the employee for the convenience In a string of cases, we have concluded that one of the
of the employer and as necessary incident to proper badges to show that a facility is customarily furnished by the
performance of his duties in which case such benefits or trade is the existence of a company policy or guideline
The Bislig allowance is given to Division Managers and
allowances do not constitute taxable income.[18] showing that provisions for a facility were designated as part
corporate officers assigned in Bislig, Surigao del Norte. Once
of the employees’ salaries.41 To comply with this, Our Haus
the officer is transferred outside Bislig, the allowance
presented in its motion for reconsideration with the NLRC the
stops.[16] The Secretary of Labor and Employment under Sec. 6,
joint sinumpaang salaysayof four of its alleged employees.
Rule VII, Book III, of the Rules Implementing the Labor
These employees averred that they were recipients of free
Code may from time to time fix in appropriate issuances the
We add that in the availment of the transportation lodging, electricity and water, as well as subsidized meals
"fair and reasonable value of board, lodging and other facilities
allowance, respondent PICOP set another requirement that from Our Haus.42
customarily furnished by an employer to his employees."
the personal cars be used by the employees in the
Petitioners' allowances do not represent such fair and
performance of their duties.
reasonable value as determined by the proper authority We agree with the NLRC’s finding that the sinumpaang
When the conditions for availment ceased to exist, the simply because the Staff/Manager's allowance and salaysay statements submitted by Our Haus are self-
allowance reached the cutoff point. The finding of the NLRC transportation allowance were amounts given by respondent serving.1âwphi1 For one, Our Haus only produced the
along the same line likewise merits concurrence, i.e., company in lieu of actual provisions for housing and documents when the NLRC had already earlier determined
petitioners' continuous enjoyment of the disputed allowances transportation needs whereas the Bislig allowance was given that Our Haus failed to prove that it was traditionally giving
was based on contingencies the occurrence of which in consideration of being assigned to the hostile environment the respondents their board and lodging. This document did
wrote finis to such enjoyment. then prevailing in Bislig. not state whether these benefits had been consistently
enjoyed by the rest of Our Haus’ employees.
Although it is quite easy to comprehend "board" and The inevitable conclusion is that, as reached by the
"lodging," it is not so with "facilities." NLRC, subject allowances did not form part of petitioners'
wages Moreover, the records reveal that the board and lodging
Thus Sec. 5, Rule VII, Book III, of the Rules were given on a per project basis. Our Haus did not show if
Implementing the Labor Code gives meaning to the term as these benefits were also provided inits other construction
including articles or services for the benefit of the employee or projects, thus negating its claimed customary nature. Even
his family but excluding tools of the trade or articles or service Our Haus Realty v Parian, 204651 (2014) assuming the sinumpaang salaysay to be true, this
primarily for the benefit of the employer or necessary to the document would still work against Our Haus’ case.
conduct of the employer's business.
If Our Haus really had the practice of freely giving lodging,
The Staff /Manager's allowance may fall under "lodging" In reality, deduction and charging both operate to lessen the electricity and water provisions to its employees, then Our
but the transportation and Bislig allowances are not embraced actual take-home pay of an employee; they are two sides of Haus should not deduct its values from the respondents’
in "facilities" on the main consideration that they are granted the same coin. In both, the employee receives a lessened wages. Otherwise, this will run contrary to the affiants’ claim
as well as the Staff/Manager's allowance for respondent amount because supposedly, the facility’s value, which is that these benefits were traditionally given free of charge.
PICOP's benefit and convenience, i.e., to insure that part of his wage, had already been paid to him in kind. As
petitioners render quality performance. In determining there is no substantial distinction between the two, the
whether a privilege is a facility, the criterion is not so much its Apart from company policy, the employer may also prove
requirements set by law must apply to both.
kind but its purpose.[17] That the assailed allowances were for compliance with the first requirement by showing the
the benefit and convenience of respondent company was existence of an industry-wide practice of furnishing the
supported by the circumstance that they were not subjected As the CA correctly ruled, these requirements, as benefits in question among enterprises engaged in the same
to withholding tax. Revenue Audit Memo Order No. 1-87 summarized in Mabeza, are the following: line of business. If it were customary among construction
pertinently provides - companies to provide board and lodging to their workers and
treat their values as part of their wages, we would have more
a. proof must be shown thatsuch facilities are
reason to conclude that these benefits were really facilities.
3.2 x x x x transportation, representation or entertainment customarily furnished by the trade;
expenses shall not constitute taxable compensation if:
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However, Our Haus could not really be expected to prove employee. This test is used to address inequitable situations If it is primarily for the employee’s gain, then the benefit is a
compliance with the first requirement since the living wherein employers consider a benefit deductible from the facility;
accommodation of workers in the construction industry is not wages even if the factual circumstances show that it clearly
simply a matter of business practice. redounds to the employers’ greater advantage.
if its provision is mainly for the employer’s advantage, then it
is a supplement. Again, this is to ensure that employees are
Peculiar to the construction business are the occupational While the rules serve as the initial test in characterizing a protected in circumstances where the employer designates a
safety and health (OSH) services which the law itself benefit as a facility, the purpose test additionally recognizes benefit as deductible from the wages even though it clearly
mandates employers to provide to their workers. that the employer and the employee do not stand at the works to the employer’s greater convenience or advantage.
same bargaining positions on benefits that must or must not
formpart of an employee’s wage. In the ultimate analysis, the
This is to ensure the humane working conditions of Under the purpose test, substantial consideration must be
purpose test seeks to prevent a circumvention of the
construction employees despite their constant exposure to given to the nature of the employer’s business in relation to
minimum wage law.
hazardous working environments. the character or type of work performed by the employees
involved.
a1. The purpose test in jurisprudence
Under Section 16 of DOLE Department Order (DO) No. 13,
series of 1998,43 employers engaged in the construction Our Haus is engaged in the construction business, a labor
business are required to providethe following welfare In the present case, the board and lodging provided by Our intensive enterprise. The success of its projects is largely a
amenities: Haus cannot be categorized asfacilities but as supplements. function of the physical strength, vitality and efficiency of its
In SLL International Cables Specialist v. National Labor laborers. Its business will be jeopardized if its workers are
Relations Commission,49 this Court was confronted with the weak, sickly, and lack the required energy to perform
16.1 Adequate supply of safe drinking water
issue on the proper characterization of the free board and strenuous physical activities. Thus, by ensuring that the
lodging provided by the employer. We explained: workers are adequately and well fed, the employer is actually
16.2 Adequate sanitaryand washing facilities investing on its business.
The Court, at this point, makes a distinction between
16.3 Suitable living accommodation for workers, and as "facilities" and "supplements". It is of the view that the food Unlike in office enterprises where the work is focused on
may be applicable, for their families and lodging, or the electricity and water allegedly consumed desk jobs, the construction industry relies heavily and
by private respondents in this case were not facilities but directly on the physical capacity and endurance of its
supplements. In the case of Atok-Big Wedge Assn. v. Atok- workers. This is not to say that desk jobs do not require
16.4 Separate sanitary, washing and sleeping
Big Wedge Co., the two terms were distinguished from one muscle strength; wesimply emphasize that in the
facilitiesfor men and women workers. [emphasis ours] construction business, bulk of the work performed are
another in this wise:
strenuous physical activities.
Moreover, DOLE DO No. 56, series of 2005, which sets out "Supplements", therefore, constitute extra remuneration or
the guidelines for the implementation ofDOLE DO No. 13, special privileges or benefits given to or received by the Moreover, in the construction business, contractors are
mandates that the cost of the implementation of the laborers overand above their ordinary earnings or wages. usually faced with the problem of meeting target deadlines.
requirements for the construction safety and health of "Facilities", on the other hand, are items of expense More often than not, work is performed continuously, day
workers, shall be integrated to the overall project cost.44 The necessary for the laborer's and his family's existence and and night, in order to finish the project on the designated
rationale behind this isto ensure that the living
subsistence so thatby express provision of law (Sec. 2[g]), turn-over date. Thus, it will be more convenient to the
accommodation of the workers is not substandard and is they form part of the wage and when furnished by the employer if itsworkers are housed near the construction site
strictly compliant with the DOLE’s OSH criteria. employer are deductible therefrom, since if they are not so to ensure their ready availability during urgent or emergency
furnished, the laborer would spend and pay for them just the circumstances. Also, productivity issues like tardiness and
As part of the project cost that construction companies same. unexpected absences would be minimized. This observation
already charge to their clients, the value of the housing of strongly bears in the present case since three of the
their workers cannot be charged again to their employees’ respondents are not residents of the National Capital
In short, the benefit or privilege given to the employee which
salaries. Our Haus cannot pass the burden of the OSH costs Region. The board and lodging provision might have been a
constitutes an extra remuneration above and over his basic
of its construction projects to its employees by deducting it substantial consideration in their acceptance of employment
or ordinary earning or wage is supplement; and when said
as facilities. This is Our Haus’ obligation under the law. benefit or privilege is part of the laborers' basic wages, it is a
in a place distant from their provincial residences.
facility. The distinction lies not so much in the kind of benefit
Lastly, even if a benefit is customarily provided by the trade, or item (food, lodging, bonus or sick leave) given, but in the Based on these considerations, we conclude that even under
it must still pass the purpose testset by jurisprudence. Under purpose for which it is given.In the case at bench, the items the purpose test, the subsidized meals and free lodging
this test, if a benefit or privilege granted to the employee is provided were given freely by SLLfor the purpose of provided by Our Haus are actually supplements. Although
clearly for the employer’s convenience, it will not be maintaining the efficiency and health of its workers while they also work to benefit the respondents, an analysis of the
considered as a facility but a supplement.45 they were working attheir respective projects.50 nature of these benefits in relation to Our Haus’ business
shows that they were given primarily for Our Haus’ greater
convenience and advantage. If weighed on a scale, the
Here, careful consideration is given to the nature of the Ultimately, the real difference lies not on the kind of the
balance tilts more towards Our Haus’ side. Accordingly, their
employer’s business in relation to the work performed by the benefit but on the purpose why it was given by the employer.
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values cannot be considered in computing the total amount Curiously, in the case at bench, the only valuations relied
of the respondents’ wages. Under the circumstances, the upon by the labor arbiter in his decision were figures
dailywages paid to the respondents are clearly below the furnished by the private respondent's own accountant,
prescribed minimum wage rates in the years 2007-2010. without corroborative evidence.

b. The provision of deductible facilities must be On the pretext that records prior to the July 16, 1990
voluntarily accepted in writing by the employee earthquake were lost or destroyed, respondent failed to
produce payroll records, receipts and other relevant
documents, where he could have, as has been pointed out in
In Mayon Hotel, we reiterated that a facility may only be
the Solicitor General's manifestation, "secured certified
deducted from the wage if the employer was authorized in
copies thereof from the nearest regional office of the
writingby the concerned employee.51 As it diminishes the
Department of Labor, the SSS or the BIR".52 [emphasis ours]
take-home pay of an employee, the deduction must be with
his express consent.
In the present case, Our Haus never explained how it came
up with the valuesit assigned for the benefits it provided; it
Again, in the motion for reconsideration with the NLRC, Our
merely listed its supposed expenses without any supporting
Haus belatedly submitted five kasunduans, supposedly
document. Since Our Haus is using these additional
executed by the respondents, containing their conformity to
expenses (cook’s salary, water and LPG) to support its claim
the inclusion of the values of the meals and housing to their
that it did not withhold the full amount of the meals’ value,
total wages. Oddly, Our Haus only offered these documents
Our Haus is burdened to present evidence to corroborate its
when the NLRC had already ruled that respondents did not
claim. The records however, are bereft of any evidence to
accomplish any written authorization, to allow deduction from
support Our Haus’ meal expense computation. Eventhe
their wages. These five kasunduans were also undated,
value it assigned for the respondents’ living accommodations
making us wonder if they had reallybeen executed when
was not supported by any documentary evidence. Without
respondents first assumed their jobs.
any corroborative evidence, it cannot be said that Our Haus
complied withthis third requisite.
Moreover, in the earlier sinumpaang salaysay by Our Haus’
four employees, it was not mentioned that they also
executed a kasunduanfor their board and lodging benefits.
Because of these surrounding circumstances and the
suspicious timing when the five kasunduanswere submitted
as evidence, we agree withthe CA that the NLRC committed
no grave abuse of discretion in disregarding these
documents for being self serving.

c. The facility must be charged at a fair and reasonable


value

Our Haus admitted that it deducted the amount of ₱290.00


per week from each of the respondents for their meals. But it
now submits that it did not actually withhold the entire
amount as it did not figure in the computation the money it
expended for the salary of the cook, the water, and the LPG
used for cooking, which amounts to ₱249.40 per week per
person. From these, it appears that the total meal expense
per week for each person is ₱529.40,making Our Haus’
₱290.00 deduction within the 70% ceiling prescribed by the
rules.

However, Our Haus’ valuation cannot be plucked out of thin


air. The valuation of a facility must be supported by relevant
documents such as receipts and company records for it to be
considered as fair and reasonable. In Mabeza, we noted:

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FINALS c. Employers of household helpers and persons in the
REVISED GUIDELINES ON THE personal service of another in relation to such workers;
IMPLEMENTATION OF THE 13TH and
3. 13th month pay MONTH PAY LAW.
a. Employees not entitled d. Employers of those who are paid on purely
commission, boundary, or task basis, and those who
are paid a fixed amount for performing specific work,
1. Removal of Salary Ceiling. irrespective of the time consumed in the performance
thereof, except where the workers are paid on piece-
PRESIDENTIAL DECREE No. On August 13, 1986, President Corazon C. Aquino issued rate basis in which case the employer shall grant the
851 December 16, 1976 Memorandum Order No. 28 which provides as follows: required 13th month pay to such workers.

As used herein, workers paid on piece-rate basis shall refer


REQUIRING ALL EMPLOYERS TO PAY to those who are paid a standard amount for every piece or
THEIR EMPLOYEES A 13th-MONTH "Section 1 of Presidential Decree No. 851 is hereby modified unit of work produced that is more or less regularly
PAY to the extent that all employers are hereby required to pay all replicated, without regard to the time spent in producing the
their rank-and-file employees a 13th month pay not later than same.
December 24 of every year."
The term "its equivalent" as used on paragraph (b) hereof
WHEREAS, it is necessary to further protect the level of real shall include
wages from the ravage of worldwide inflation;
Before its modification by the aforecited Memorandum 1. Christmas bonus,
Order, P.D. No. 851 excludes from entitlement to the 13th 2. mid-year bonus,
WHEREAS, there has been no increase in the legal month pay those employees who were receiving a basic 3. cash bonuses and
minimum wage rates since 1970; salary of more than P1,000.00 a month. 4. other payments amounting to not less than 1/12 of the
basic salary
WHEREAS, the Christmas season is an opportune time for With the removal of the salary ceiling of P1,000.00, all rank
society to show its concern for the plight of the working and file employees are now entitled to a 13th month pay but shall not include
masses so they may properly celebrate Christmas and New regardless of the amount of basic salary that they receive in
Year. a month if their employers are not otherwise exempted from 1. cash and stock dividends,
the application of P.D. No. 851. 2. cost of living allowances and all other allowances
NOW, THEREFORE, I, FERDINAND E. MARCOS, by virtue regularly enjoyed by the employee,
Such employees are entitled to the benefit regardless of their 3. as well as non-monetary benefits.
of the powers vested in me by the Constitution, do hereby
designation or employment status, and irrespective of the
decree as follows:
method by which their wages are paid, provided that they Where an employer pays less than required 1/12th of the
have worked for at least one (1) month during a calendar employees basic salary, the employer shall pay the
Section 1. All employers are hereby required to pay all their year. difference. chan robles virtual law library
employees receiving a basic salary of not more than P1,000
a month, regardless of the nature of their employment, a Xxxx
13th-month pay not later than December 24 of every year.
2. Exempted Employers.
Section 2. Employers already paying their employees a
13th-month pay or its equivalent are not covered by this The following employers are still not covered by P.D. No. 4. Amount and payment of 13th Month Pay
Decree. 851
(a) Minimum of the Amount. — The minimum 13th month
a. The Government and any of its political subdivisions, pay required by law shall not be less than one-twelfth of
Section 3. This Decree shall take effect immediately. including government-owned and controlled the total basic salary earned by an employee within a
corporations, excepts those corporations operating calendar year. xxxx
Done in the City of Manila, this 16th day of December 1975. essentially as private subsidiaries of the Government;
xxxx
b. Employers already paying their employees a 13th
month pay or more in a calendar year or its equivalent The "basic salary" of an employee for the purpose of
at the time of this issuance; computing the 13th month pay shall include

1. all remunerations or earning paid by this employer for


services rendered
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2. but does not include (b) Those with Multiple Employers. — Government 8. Prohibitions against reduction or elimination of
a. allowances and monetary benefits which are employees working part time in a private enterprise, benefits.
not considered or integrated as part of the including private educational institutions, as well as
regular or basic salary, employees working in two or more private firms, Nothing herein shall be construed to authorize any employer
i. such as the cash equivalent of whether on full or part time basis, are entitled to the to eliminate, or diminish in any way, supplements, or other
unused vacation and sick leave required 13th month pay from all their private employers employee benefits or favorable practice being enjoyed by the
credits, regardless of their total earnings from each or all their employee at the time of promulgation of this issuance.
ii. overtime, employers.
iii. premium,
iv. night differential and (c) Private School Teachers. — Private school
v. holiday pay, and teachers, including faculty members of universities and Petroleum shipping limited v NLRC,
vi. cost-of-living allowances. colleges, are entitled to the required 13th month pay, 148130 (2006)
regardless of the number of months they teach or are
EXPN: paid within a year, if they have rendered service for at
least one (1) month within a year.
However, these salary-related benefits should be included as Tanchico was a contractual, not a regular, employee.
part of the basic salary in the computation of the 13th month Further, PD 851 does not apply to seafarers. The
pay if by individual or collective agreement, company WHEREAS clauses of PD 851 provides: WHEREAS, it is
practice or policy, the same are treated as part of the basic 6. 13th Month Pay of Resigned or Separated Employee. necessary to further protect the level of real wages from
salary of the employees. ravages of world-wide inflation;

WHEREAS, there has been no increase in the legal


An employee who has resigned or whose services were minimum wage rates since 1970;
(b) Time of Payment. — terminated at any time before the time for payment of the
13th month pay is entitled to this monetary benefit in WHEREAS, the Christmas season is an opportune time for
GR: proportion to the length of time he worked during the year, society to show its concern for the plight of the working
reckoned from the time he started working during the masses so they may properly celebrate Christmas and New
The required 13th month pay shall be paid not later than calendar year up to the time of his resignation or termination Year.
December 24 of each year. from the service. Thus, if he worked only from January up to
September his proportionate 13th month pay should be PD 851 contemplates the situation of land-based workers,
EXPN: equivalent of 1/12 his total basic salary he earned during that and not of seafarers who generally earn more than domestic
period. land-based workers. Petroleum Shipping Limited vs. National
An employer, however, may give to his employees one half
Labor Relations Commission, 491 SCRA 35, G.R. No.
(½) of the required 13th month pay before the opening of the
148130 June 16, 2006
regular school year and the other half on before the 24th of
December of every year. The payment of the 13th month pay may be demanded by
the employee upon the cessation of employer-employee
The frequency of payment of this monetary benefit may be relationship. 4. Bonus
the subject of agreement between the employer and the
recognized/collective bargaining agent of the employees. This is consistent with the principle of equity that as the
employer can require the employee to clear himself of all
liabilities and property accountability, so can the employee Producers bank v NLRC, 355 SCRA 489
demand the payment of all benefits due him upon the
5. 13th Month Pay for Certain Types of Employees.
termination of the relationship.

A bonus is an amount granted and paid to an employee for


(a) Employees Paid by Results. — Employees who are his industry and loyalty which contributed to the success of
7. Non-inclusion in Regular Wage. the employer’s business and made possible the realization of
paid on piece work basis are by law entitled to the 13th
month pay. profits.
The mandated 13th month pay need not be credited as part
of regular wage of employees for purposes of determining It is an act of generosity granted by an enlightened employer
Employees who are paid a fixed or guaranteed wage
overtime and premium pays, fringe benefits insurance fund, to spur the employee to greater efforts for the success of the
plus commission are also entitled to the mandated 13th
Social Security, Medicare and private retirement plans. business and realization of bigger profits.
month pay, based on their total earnings during the
calendar year, i.e., on both their fixed or guaranteed
wage and commission.
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The granting of a bonus is a management prerogative, less or why the others receive more. That would be adding Employers may also have claims against the employee,
something given in addition to what is ordinarily received by insult to injury. The employer has discriminated against that which arise from the same relationship.
or strictly due the recipient. Thus, a bonus is not a employee; it is for the employer to explain why the employee
demandable and enforceable obligation, except when it is is treated unfairly. In Bañez v. Valdevilla, 331 SCRA 584 (2000), this court
made part of the wage, salary or compensation of the ruled that Article 217 of the Labor Code also applies to
employee. employers’ claim for damages, which arises from or is
connected with the labor issue.
However, an employer cannot be forced to distribute 6. Withholding of wages
bonuses which it can no longer afford to pay. To hold Thus: Whereas this Court in a number of occasions had
otherwise would be to penalize the employer for his past applied the jurisdictional provisions of Article 217 to claims
generosity. for damages filed by employees, we hold that by the
SHS Perforated Materials v Diaz, 185814 designating clause “arising from the employer-employee
(2010) relations” Article 217 should apply with equal force to the
claim of an employer for actual damages against its
5. Equal pay for work of equal value dismissed employee, where the basis for the claim arises
from or is necessarily connected with the fact of termination,
Management prerogative refers “to the right of an employer and should be entered as a counterclaim in the illegal
to regulate all aspects of employment, such as the freedom dismissal case.
International school alliance of educators to prescribe work assignments, working methods, processes
v Quisumbing, G.R. No. 128845. June 1, to be followed, regulation regarding transfer of employees, Clearance procedures are instituted to ensure that the
2000 supervision of their work, lay-off and discipline, and dismissal properties, real or personal, belonging to the employer but
and recall of work.” are in the possession of the separated employee, are
returned to the employer before the employee’s departure.—
Although management prerogative refers to “the right to Requiring clearance before the release of last payments to
Giving 25% more income to foreign hires "to remain globally regulate all aspects of employment,” it cannot be understood the employee is a standard procedure among employers,
competitive" violates the principle of equal pay for work of to include the right to temporarily withhold salary/wages whether public or private. Clearance procedures are
equal value without the consent of the employee. instituted to ensure that the properties, real or personal,
belonging to the employer but are in the possession of the
The Constitution also directs the State to promote “equality To sanction such an interpretation would be contrary to
separated employee, are returned to the employer before the
of employment opportunities for all.” Similarly, the Labor Article 116 of the Labor Code, x x x Any withholding of an
employee’s departure.
Code provides that the State shall “ensure equal work employee’s wages by an employer may only be allowed in
opportunities regardless of sex, race or creed.” It would be the form of wage deductions under the circumstances As a general rule, employers are prohibited from withholding
an affront to both the spirit and letter of these provisions if provided in Article 113 of the Labor Code. SHS Perforated wages from employees. The Labor Code provides: Art. 116.
the State, in spite of its primordial obligation to promote and Materials, Inc. vs. Diaz, 633 SCRA 258, G.R. No. 185814 Withholding of wages and kickbacks prohibited.—It shall be
ensure equal employment opportunities, closes its eyes to October 13, 2010 unlawful for any person, directly or indirectly, to withhold any
unequal and discriminatory terms and conditions of amount from the wages of a worker or induce him to give up
employment. Exception:
any part of his wages by force, stealth, intimidation, threat or
1. Insurance by any other means whatsoever without the worker’s
Discrimination, particularly in terms of wages, is frowned
consent.
upon by the Labor Code. Article 135, for example, prohibits
and penalizes the payment of lesser compensation to a 2. Union dues
The return of the property’s possession became an
female employee as against a male employee for work of obligation or liability on the part of the employees when the
3. Authorized by law
equal value. Article 248 declares it an unfair labor practice employer-employee relationship ceased. Thus, respondent
for an employer to discriminate in regard to wages in order to Solid Mills has the right to withhold petitioners’ wages and
encourage or discourage membership in any labor benefits because of this existing debt or liability
organization.
Thus: There was valid reason for respondents’ withholding of
The School contends that petitioner has not adduced Milan v NLRC, 202961 (2015) petitioner’s salary for the month of February 2000. Petitioner
evidence that local-hires perform work equal to that of does not deny that he is indebted to his employer in the
foreign-hires. The Court finds this argument a little cavalier. If amount of around P95,000.00. Respondents explained that
an employer accords employees the same position and rank, petitioner’s salary for the period of February 1-15, 2000 was
the presumption is that these employees perform equal Claims arising from an employer-employee relationship are applied as partial payment for his debt and for withholding
work. This presumption is borne by logic and human not limited to claims by an employee. taxes on his income; while for the period of February 15-28,
experience. If the employer pays one employee less than the 2000, petitioner was already on absence without leave,
rest, it is not for that employee to explain why he receives
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hence, was not entitled to any pay. Milan vs. National Labor mortgaged assets is a special preferred lien that must be
Relations Commission, 750 SCRA 1, G.R. No. 202961 satisfied first before the claims of the workers.
February 4, 2015

7. Direct payment principle


Death; heirs need not to institute testate or intestate Workers’ claims for unpaid wages and monetary benefits
proceedings cannot be paid outside of a bankruptcy or judicial liquidation Prubankers Association v Prudential
proceedings against the employer. It is settled that the Bank & Trust Company, 131247 (1999)
8. Non-diminution of benefits application of Article 110 of the Labor Code is contingent
upon the institution of those proceedings, during which all
creditors are convened, their claims ascertained and
inventoried, and their preferences determined. Assured The concept of wage distortion assumes an existing
Central Azucarera de Tarlac v Central thereby is an orderly determination of the preference given to grouping or classification of employees which establishes
Azucara de Tarlac Union, 188949 (2010) creditors’ claims; and preserved in harmony is the legal distinctions among such employees on some relevant or
scheme of classification, concurrence and preference of legitimate basis. This classification is reflected in a differing
credits in the Civil Code, the Insolvency Law, and the Labor wage rate for each of the existing classes of employees.”
Code.
Petitioner, for 30 years, included in the computation for 13th Wage distortion involves four elements:
month pay gross annual earnings, which includes other
benefits. Hence, it's withdrawal constitutes a violation of the (a) An existing hierarchy of positions with corresponding
non-diminution rule 10. Wage Order salary rates;
11. Wage distortion (b) A significant change in the salary rate of a lower pay
Benefits given to employees cannot be taken back or class without a concomitant increase in the salary rate
reduced unilaterally by the employer because the benefit has of a higher one;
become a part of the employment contract, written or (c) The elimination of the distinction between the two
unwritten PI Manufacturing v PP Manufacturing levels;
Supervisors and Foremen Association, (d) The existence of the distortion in the same region of the
167217 (1999) country.
9. Preferential right in case of bankruptcy In the present case, it is clear that no wage distortion
resulted when respondent implemented the subject Wage
Interestingly, such gap as re-established by virtue of the Orders in the covered branches.
CBA is more than a substantial compliance with R.A. No.
Barayoga v. Asset Privatization Trust, In the said branches, there was an increase in the salary
6640. We hold that the Court of Appeals erred in not taking
160073 (2005) rates of all pay classes. Furthermore, the hierarchy of
into account the provisions of the CBA vis-à-vis the wage
increase under the said law. positions based on skills, length of service and other logical
bases of differentiation was preserved.
In National Federation of Labor v. NLRC, 234 SCRA 311
This Court has ruled in a long line of cases that under In other words, the quantitative difference in compensation
(1994), we held: We believe and so hold that the re-
Articles 2241 and 2242 of the Civil Code, a mortgage credit between different pay classes remained the same in all
establishment of a significant gap or differential between
is a special preferred credit that enjoys preference with branches in the affected region. Put differently, the
regular employees and casual employees by operation of the
respect to a specific/determinate property of the debtor. distinction between Pay Class 1 and Pay Class 2, for
CBA was more than substantial compliance with the
requirements of the several Wage Orders (and of Article 124 example, was not eliminated as a result of the
On the other hand, the worker’s preference under Article 110 implementation of the two Wage Orders in the said region.
of the Labor Code is an ordinary preferred credit. While this of the Labor Code).
Hence, it cannot be said that there was a wage distortion.
provision raises the worker’s money claim to first priority in
That this re-establishment of a significant differential was the
the order of preference established under Article 2244 of the A disparity in wages between employees holding similar
result of collective bargaining negotiations, rather than of a
Civil Code, the claim has no preference over special positions but in different regions does not constitute wage
special grievance procedure, is not a legal basis for ignoring
preferred credits. distortion as contemplated by law..
it. The NLRC En Banc was in serious error when it
Thus, the right of employees to be paid benefits due them disregarded the differential of P3.60 which had been
from the properties of their employer cannot have any restored by 1 July 1985 upon the ground that such
preference over the latter’s mortgage credit. In other words, differential “represent[ed] negotiated wage increase[s] which
Metrobank v NWPC, 144322 (2007)
being a mortgage credit, APT’s lien on BISUDECO’s should not be considered covered and in compliance with
the Wage Orders. x x x”

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Assailed wage order is void because it added an across-the- a. The Secretary of Labor and Employment
board wage increase of P15 to all EEs and wokers of region b. or his duly authorized representatives,
2 without showing it followed the floor wage or salary ceiling c. including labor regulation officers,
WHO:
methods. Hence, it made earners receiving more then the
minimum wage to earn more What:
a. The Secretary or
In line with its declared policy, R.A. No. 6727 created the b. his duly authorized representatives
NWPC, vested with the power to prescribe rules and a. shall have access to employer’s records and premises
guidelines for the determination of appropriate minimum b. at any time of the day or night whenever work is being
WHAT
undertaken therein,
wage and productivity measures at the regional, provincial or
c. and the right to copy therefrom,
industry levels; and authorized the RTWPB to determine and
d. to question any employee c. shall issue writs of execution to the appropriate authority
fix the minimum wage rates applicable in their respective e. and investigate any fact, condition or matter
regions, provinces, or industries therein and issue the
corresponding wage orders, subject to the guidelines issued PURPOSE
by the NWPC. Pursuant to its wage fixing authority, the Purpose:
RTWPB may issue wage orders which set the daily minimum d. for the enforcement of their orders,
wage rates, based on the standards or criteria set by Article a. which may be necessary to determine violations
124 of the Labor Code. b. or which may aid in the enforcement of this Code and of
any labor law, wage order or rules and regulations except in cases
In ECOP, the Court declared that there are two ways of issued pursuant thereto.
fixing the minimum wage: the “floor-wage” method and the a. where the employer contests the findings of the labor
“salary-ceiling” method. SECOND POWER employment and enforcement officer
b. and raises issues supported by documentary proofs
The “floorwage” method involves the fixing of a determinate c. which were not considered in the course of inspection
amount to be added to the prevailing statutory minimum Notwithstanding the provisions of Articles 129 and 217 of this
wage rates. Code to the contrary, and in cases where the relationship of
employer-employee still exists:
On the other hand, in the “salary-ceiling” method, the wage
adjustment was to be applied to employees receiving a WHO An order issued by the duly authorized representative of the
certain denominated salary ceiling. Secretary of Labor and Employment under this Article may
be appealed to the latter.
In other words, workers already being paid more than the a. the Secretary of Labor and Employment
existing minimum wage (up to a certain amount stated in the b. or his duly authorized representatives
In case said order involves a monetary award:
Wage Order) are also to be given a wage increase.
Metropolitan Bank and Trust Company, Inc. vs. National WHAT
a. an appeal by the employer may be perfected only upon
Wages and Productivity Commission, 514 SCRA 346, G.R.
the posting of a cash or surety bond
No. 144322 February 6, 2007 a. shall have the power to issue compliance orders b. issued by a reputable bonding company
c. duly accredited by the Secretary of Labor and
F. Administration and Enforcement Employment
d. in the amount equivalent to the monetary award in the
order appealed from.
Chapter VI
PURPOSE
ADMINISTRATION AND ENFORCEMENT
FOURTH POWER
b. to give effect to the labor standards provisions of this Code
1. Visitorial and Enforcement power
and other labor legislation
WHO
c. based on the findings of labor employment and enforcement
Article 128. Visitorial and enforcement power. officers or industrial safety engineers made in the course of
inspection. 1. The Secretary of Labor and Employment
FIRST POWER
WHAT

THIRD POWER 2. may likewise order stoppage of work


Who:
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3. or suspension of operations of any unit or department of WHAT: unpaid wages and other monetary claims and benefits,
an establishment including legal interest, found owing to any employee or
househelper under this Code. (As amended by Section 2,
1. is empowered, through summary proceeding and after
Republic Act No. 6715, March 21, 1989)
PURPOSE due notice,
a. to hear and decide any matter involving
i. the recovery of wages and other
4. when non-compliance with the law or implementing
monetary claims and benefits,
rules and regulations poses grave and imminent danger
ii. including legal interest, owing to an
to the health and safety of workers in the workplace.
employee or person employed in
domestic or household service or
Within twenty-four hours, a hearing shall be conducted to househelper under this Code,
determine whether an order for the stoppage of work or arising from employer-employee
suspension of operations shall be lifted or not. relations: Bay Haven v Abuan, 160859 (2008)

In case the violation is attributable to the fault of the Exception:


employer, he shall pay the employees concerned their Abuan’s allegation of illegal dismissal was his personal
salaries or wages during the period of such stoppage of work accusation, and did not necessarily apply to all the other
3. Provided, That such complaint does not include a claim
or suspension of operation. employees. The records also do not support a contrary
for reinstatement:
4. Provided further, That the aggregate money claims of finding. But Abuan’s other allegations of underpayment and
It shall be unlawful for any person or entity to obstruct, each employee or househelper does not exceed Five other potential violations of labor laws and regulations were
impede, delay or otherwise render ineffective the orders of thousand pesos (P5,000.00). within the obligation of the Regional Director to investigate,
the Secretary of Labor and Employment or his duly especially insofar as they affect Abuan’s remaining co-
authorized representatives issued pursuant to the authority workers. Under Art. 128, the Regional Director can conduct
The Regional Director or hearing officer shall decide or
granted under this Article, and no inferior court or entity shall inspections and check all violations of labor laws, and
resolve the complaint within thirty (30) calendar days from
issue temporary or permanent injunction or restraining order enforce compliance measures for the benefit of all
the date of the filing of the same.
or otherwise assume jurisdiction over any case involving the
employees, without being compelled to rely on a complaint
enforcement orders issued in accordance with this Article.
Any sum thus recovered on behalf of any employee or that has been filed or its allegations.
househelper pursuant to this Article
Any government employee found guilty of violation of, or In fact, the article is silent on whether the filing of a complaint
abuse of authority, under this Article shall, after appropriate is even required to initiate the exercise of the inspection and
administrative investigation, be subject to summary dismissal 3. shall be held in a special deposit account by, and shall enforcement powers.
from the service. be paid on order of, the Secretary of Labor and
Employment or the Regional Director directly to the The mere disagreement by the employer with the findings of
employee or househelper concerned. the labor officer, or the simple act of presenting controverting
The Secretary of Labor and Employment may, by
4. Any such sum not paid to the employee or househelper evidence, does not automatically divest the DOLE Secretary
appropriate regulations, require employers to keep and
because he cannot be located after diligent and or any of his authorized representatives such as the
maintain such employment records as may be necessary in
reasonable effort to locate him within a period of three Regional Directors, of jurisdiction to exercise their visitorial
aid of his visitorial and enforcement powers under this Code.
(3) years, shall be held as a special fund of the
and enforcement powers under the Labor Code.
Department of Labor and Employment to be used
2. Adjudicatory power exclusively for the amelioration and benefit of workers.
Under prevailing jurisprudence, the so-called exception
clause in Art. 128(b) of the Labor Code has the following
Article 129. Recovery of wages, simple money claims and Any decision or resolution of the Regional Director or hearing elements, which must all concur to divest the regional
other benefits. (ADJUDICATORY) officer pursuant to this provision may be appealed on the director of jurisdiction over workers’ claims:
same grounds provided in Article 223 of this Code,
(a) that the employer contests the findings of the labor
Upon complaint of any interested party,
4. within five (5) calendar days from receipt of a copy of regulations officer and raises issues thereon;
said decision or resolution, (b) that in order to resolve such issues, there is a need to
WHO: 5. to the National Labor Relations Commission examine evidentiary matters; and
6. which shall resolve the appeal within ten (10) calendar (c) that such matters are not verifiable in the normal course
1. the Regional Director of the Department of Labor and days from the submission of the last pleading required of inspection.
Employment or or allowed under its rules.
2. any of the duly authorized hearing officers of the Thus, in SSK Parts Corporation v. Camas, 181 SCRA 675
Department (1990), in which the employer contested the Regional
The Secretary of Labor and Employment or his duly
authorized representative may supervise the payment of Director’s finding of violations of labor standards, but such
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issue was resolved by an examination of evidentiary matters This was further affirmed in our ruling in Cirineo Bowling (b) To establish separate toilet rooms and lavatories for
which were verifiable in the ordinary course of inspection, it Plaza, Inc. v. Sensing,[24] where we sustained the jurisdiction men and women and provide at least a dressing room
was held that there was no more need to indorse the case to of the DOLE Regional Director and held that the for women;
the arbitration branch of the NLRC. visitorial and enforcement powers of the DOLE Regional (c) To establish a nursery in a workplace for the benefit of
Director to order and enforce compliance with labor the women employees therein; and
The key requirement for the Regional Director and the DOLE standard laws can be exercised even where the individual (d) To determine appropriate minimum age and other
Secretary to be divested of jurisdiction is that the evidentiary claim exceeds P5,000. standards for retirement or termination in special
matters are not verifiable in the course of inspection. occupations such as those of flight attendants and the
However, if the labor standards case is covered by the like.
Where the evidence presented was verifiable in the normal exception clause in Article 128(b) of the Labor Code, then the
course of inspection, even if presented belatedly by the Regional Director will have to endorse the case to the
Article 133. Maternity leave benefits.
appropriate Arbitration Branch of the NLRC.
employer, the Regional Director, and later the DOLE
Secretary, may still examine them; and these officers are not
In order to divest the Regional Director or his representatives Every employer shall grant to any pregnant woman
divested of jurisdiction to decide the case. of jurisdiction, the following elements must be present: employee
In the present case, petitioners’ pieces of evidence of the (a) that the employer contests the findings of the labor
alleged contract of lease, payroll sheets, and quitclaims were regulations officer and raises issues thereon; (a) who has rendered an aggregate service of at least six
all verifiable in the normal course of inspection and, granting (6) months for the last twelve (12) months,
(b) that in order to resolve such issues, there is a need to
that they were not examined by the labor inspector, they examine evidentiary matters; and (b) maternity leave of at least two (2) weeks prior to the
have nevertheless been thoroughly examined by the (c) that such matters are not verifiable in the normal course expected date of delivery
(c) and another four (4) weeks after normal delivery or
Regional Director and the DOLE Secretary. For these of inspection.[25]
(d) The rules also provide that the employer shall raise such abortion with full pay based on her regular or average
reasons, the exclusion clause of Art. 128(b) does not apply
objections during the hearing of the case or at any time weekly wages.
Bay Haven, Inc., vs. Abuan, 560 SCRA 457, G.R. No.
160859 July 30, 2008 after receipt of the notice of inspection results.[26]
The employer may require from any woman employee
In this case, the Regional Director validly assumed jurisdiction applying for maternity leave the production of a medical
over the money claims of private respondents even if the certificate stating that delivery will probably take place within
claims exceeded P5,000 because such jurisdiction was two weeks.
exercised in accordance with Article 128(b) of the Labor Code
Ex-Bataan Veterans Sec of Labor and the case does not fall under the exception clause.
The maternity leave shall be extended without pay on
(152396) account of illness medically certified to arise out of the
pregnancy, delivery, abortion or miscarriage, which renders
G. Special Groups of Employees the woman unfit for work, unless she has earned unused
leave credits from which such extended leave may be
On the Regional Directors Jurisdiction over the Money charged.
Claims
Title III
WORKING CONDITIONS FOR The maternity leave provided in this Article shall be paid by
In Allied Investigation Bureau, Inc. v. Sec. of Labor, we ruled
the employer only for the first four (4) deliveries by a woman
that: SPECIAL GROUPS OF EMPLOYEES
employee after the effectivity of this Code.
While it is true that under Articles 129 and 217
of the Labor Code, the Labor Arbiter has
jurisdiction to hear and decide cases where Chapter I
the aggregate money claims of each EMPLOYMENT OF WOMEN
employee exceeds P5,000.00, said provisions Article 134. Family planning services; incentives for family
of law do not contemplate nor cover planning.
the visitorial and enforcement powers of the Article 132. Facilities for women. The Secretary of Labor
Secretary of Labor or his duly authorized and Employment shall establish standards that will ensure Establishments which are required by law to maintain a clinic
representatives. the safety and health of women employees. In appropriate or infirmary shall provide free family planning services to
cases, he shall, by regulations, require any employer to: their employees which shall include, but not be limited to, the
Rather, said powers are defined and set forth application or use of contraceptive pills and intrauterine
in Article 128 of the Labor Code (as amended (a) Provide seats proper for women and permit them to use devices.
by R.A. No. 7730) thus: such seats when they are free from work and during
working hours, provided they can perform their duties in In coordination with other agencies of the government
this position without detriment to efficiency; engaged in the promotion of family planning, the Department
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of Labor and Employment shall develop and prescribe him for the purpose of preventing her from enjoying any employer in two equal installments within thirty (30) days
incentive bonus schemes to encourage family planning of the benefits provided under this Code. from the filing of the maternity leave application:
among female workers in any establishment or enterprise. (b) To discharge such woman on account of her
pregnancy, or while on leave or in confinement due to "(c) That in case of caesarian delivery, the
her pregnancy; employee shall be paid the daily maternity benefit for
(c) To discharge or refuse the admission of such woman seventy-eight (78) days;
upon returning to her work for fear that she may again
Article 135. Discrimination prohibited. It shall be unlawful for be pregnant. "(d) That payment of daily maternity benefits shall
any employer to discriminate against any woman employee be a bar to the recovery of sickness benefits provided by this
with respect to terms and conditions of employment solely on Act for the same compensable period of sixty (60) days for
Article 138. Classification of certain women workers. Any
account of her sex. the same childbirth, abortion, or miscarriage;
woman who is permitted or suffered to work, with or without
compensation, in any night club, cocktail lounge, massage
"(e) That the maternity benefits provided under
The following are acts of discrimination: clinic, bar or similar establishments under the effective
this Section shall be paid only for the first four deliveries
control or supervision of the employer for a substantial
after March 13, 1973;
period of time as determined by the Secretary of Labor and
(a) Payment of a lesser compensation, including wage,
Employment, shall be considered as an employee of such
salary or other form of remuneration and fringe benefits, "(f) That the SSS shall immediately reimburse the
establishment for purposes of labor and social legislation.
to a female employees as against a male employee, for employer of one hundred percent (100%) of the amount
work of equal value; and of maternity benefits advanced to the employee by the
(b) Favoring a male employee over a female employee with employer upon receipt of satisfactory proof of such payment
respect to promotion, training opportunities, study and and legality thereof; and
RA 7322 - AN ACT INCREASING
scholarship grants solely on account of their sexes.
MATERNITY BENEFITS IN FAVOR OF "(g) That if an employee should give birth or
WOMEN WORKERS IN THE PRIVATE suffer abortion or miscarriage without the required
Criminal liability for the willful commission of any unlawful act SECTOR, AMENDING FOR THE contributions having been remitted for her by her employer
as provided in this Article or any violation of the rules and PURPOSE SECTION 14-A OF to the SSS, or without the latter having been previously
regulations issued pursuant to Section 2 hereof shall be REPUBLIC ACT NO. 1161, AS notified by the employer of the time of the pregnancy, the
penalized as provided in Articles 288 and 289 of this Code: employer shall pay to the SSS damages equivalent to the
AMENDED, AND FOR OTHER
PURPOSES benefits which said employee would otherwise have been
Provided, That the institution of any criminal action under this entitled to, and the SSS shall in turn pay such amount to the
provision shall not bar the aggrieved employee from filing an employee concerned."
entirely separate and distinct action for money claims, which
may include claims for damages and other affirmative reliefs. ECTION 1. Section 14-A of Republic Act No. 1161,
The actions hereby authorized shall proceed independently as amended, is further amended to read as follows: SEC. 2. Nothing in this Act shall be construed as to diminish
of each other. (As amended by Republic Act No. 6725, May existing maternity benefits under present laws
12, 1989) and collective bargaining agreements.
"SEC. 14-A. Maternity Leave Benefit. –
Article 136. Stipulation against marriage. It shall be unlawful
for an employer to require as a condition of employment or Republic Act No. 9262 March 08, 2004
continuation of employment that a woman employee shall (a) A covered female employee
not get married, or to stipulate expressly or tacitly that upon (b) who has paid at least three monthly
getting married, a woman employee shall be deemed maternity contributions in the twelve-month period
preceding the semester of her childbirth, abortion or AN ACT DEFINING VIOLENCE
resigned or separated, or to actually dismiss, discharge,
miscarriage AGAINST WOMEN AND THEIR
discriminate or otherwise prejudice a woman employee
merely by reason of her marriage. (c) and who is currently employed CHILDREN, PROVIDING FOR
(d) shall be paid a daily maternity benefit equivalent to one PROTECTIVE MEASURES FOR
hundred percent (100%) of her present basic salary, VICTIMS, PRESCRIBING PENALTIES
allowances and other benefits or the cash equivalent of THEREFORE, AND FOR OTHER
such benefits for sixty (60) days PURPOSES
(e) subject to the following conditions:
Article 137. Prohibited acts.
"(a) That the employee shall have notified her
It shall be unlawful for any employer: employer of her pregnancy and the probable date of her
SECTION 4. Construction.- This Act shall be liberally
childbirth which notice shall be transmitted to the SSS in
construed to promote the protection and safety of victims of
accordance with the rules and regulations it may provide;
(a) To deny any woman employee the benefits provided for violence against women and their children.
in this Chapter or to discharge any woman employed by
"(b) That the payment shall be advanced by the
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other benefits, privileges, or consideration; or (d) a daily sickness benefit equivalent to ninety percent
RA 7877 - AN ACT DECLARING (90%) of his average daily salary credit, subject to the
SEXUAL HARASSMENT UNLAWFUL IN (4) When the sexual advances result in an following conditions:
THE EMPLOYMENT, EDUCATION OR intimidating, hostile or offensive environment for the student,
TRAINING ENVIRONMENT, AND FOR trainee or apprentice.
"(1) In no case shall the daily sickness benefit
OTHER PURPOSES. be paid longer than one hundred twenty (120)
Any person who directs or induces another to commit days in one (1) calendar year, nor shall any
unused portion of the one hundred twenty
any act of sexual harassment as herein defined, or who
cooperates in the commission thereof by another without (120) days of sickness benefit granted under
SECTION 3. Work, Education or Training -Related, Sexual which it would not have been committed, shall also be held this section be carried forward and added to
Harassment Defined. – liable under this Act.
the total number of compensable days
allowable in the subsequent year;
xxxx
Work, education or training-related sexual harassment is
"(2) The daily sickness benefit shall not be
committed by an employer, employee, manager, supervisor,
paid for more than two hundred forty (240)
agent of the employer, teacher, instructor, professor, coach, SECTION 5. Liability of the Employer, Head of Office, days on account of the same confinement;
trainor, or any other person who, having authority, influence Educational or Training Institution. - The employer or head of and
or moral ascendancy over another in a work or training or office, educational or training institution shall be solidarily
education environment, demands, requests or otherwise liable for damages arising from the acts of sexual
requires any sexual favor from the other, regardless of harassment committed in the employment, education or "(3) The employee member shall notify his
whether the demand, request or requirement for submission training environment if the employer or head of employer of the fact of his sickness or injury
is accepted by the object of said Act. office, educational or training institution is informed of such within five (5) calendar days after the start of
acts by the offended party and no immediate action is taken. his confinement unless such confinement is
(a) In a work-related or employment environment, in a hospital or the employee became sick or
sexual harassment is committed when: SECTION 6. Independent Action for Damages. - Nothing was injured while working or within the
in this Act shall preclude the victim of work, education or premises of the employer in which case,
training-related sexual harassment from instituting notification to the employer is necessary:
(1) The sexual favor is made as a condition in a separate and independent action for damages and other
the hiring or in the employment, re-employment or continued affirmative relief. Provided, That if the member is
employment of said individual, or in granting said individual
unemployed or self-employed, he
favorable compensation, terms of conditions, promotions, or
shall directly notify the SSS of his
privileges; or the refusal to grant the sexual favor results in
confinement within five (5) calendar
limiting, segregating or classifying the employee which in any
Republic Act No. 8282 May 01, days after the start thereof unless
way would discriminate, deprive ordiminish employment
1997 such confinement is in a hospital in
opportunities or otherwise adversely affect said employee;
which case notification is also not
necessary:
(2) The above acts would impair the employee's
rights or privileges under existing labor laws; or AN ACT FURTHER STRENGTHENING
THE SOCIAL SECURITY SYSTEM Provided, further, That in cases
(3) The above acts would result in an intimidating, THEREBY AMENDING FOR THIS where notification is necessary, the
hostile, or offensive environment for the employee. PURPOSE, REPUBLIC ACT NO. 1161, confinement shall be deemed to
AS AMENDED, OTHERWISE KNOWN have started not earlier than the
AS THE SOCIAL SECURITY LAW fifth day immediately preceding the
(b) In an education or training environment, sexual date of notification.
harassment is committed:
"(b) The compensable confinement shall
"SEC. 14. Sickness Benefit. – begin on the first day of sickness, and the
(1) Against one who is under the care, custody or
supervision of the offender; payment of such allowances shall be
(a) A member who has paid at least three (3) monthly promptly made by the employer every regular
contributions in the twelve-month period immediately payday or on the fifteenth and last day of
(2) Against one whose education, training, preceding the semester of sickness or injury each month, and similarly in the case of direct
apprenticeship or tutorship is entrusted to the offender; (b) and is confined therefor for more than three (3) days in payment by the SSS, for as long as such
a hospital or elsewhere with the approval of the SSS, allowances are due and payable:
(3) When the sexual favor is made a condition to (c) shall, for each day of compensable confinement or a
the giving of a passing grade, or the granting of honors and fraction thereof, be paid by his employer, or the SSS, if Provided, That such allowance shall begin
scholarships, or the payment of a stipend, allowance or such person is unemployed or self-employed, only after all sick leaves of absence with full
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pay to the credit of the employee member interest of one percent (1%) per month until
shall have been exhausted. paid. Republic Act No. 9710 August 14,
2009
"(c) One hundred percent (100%) of the daily "(f) The provisions regarding the notification
benefits required of the member and the employer as
well as the period within which the claim for AN ACT PROVIDING FOR THE MAGNA
benefit or reimbursement may be filed shall CARTA OF WOMEN
Provided in the preceding paragraph shall be
apply to all claims filed with the SSS.
reimbursed by the SSS to said employer
upon receipt of satisfactory proof of such
payment and legality thereof:
CHAPTER II
DEFINITION OF TERMS
Provided, That the employer has notified the "SEC. 14-A. Maternity Leave Benefit. - A female member
SSS of the confinement within five (5) who has paid at least three (3) monthly contributions in the
Section 4. Definitions. - For purposes of this Act, the
calendar days after receipt of the notification twelve-month period immediately preceding the semester of
following terms shall mean:
from the employee member: her childbirth or miscarriage shall be paid a daily maternity
benefit equivalent to one hundred percent (100%) of her
average daily salary credit for sixty (60) days or seventy- (b) "Discrimination Against Women" refers to any
Provided, further, That if the notification to the
eight (78) days in case of caesarian delivery, subject to the gender-based distinction, exclusion, or restriction which
SSS is made by the employer beyond five (5)
following conditions: has the effect or purpose of impairing or nullifying the
calendar days after receipt of the notification
recognition, enjoyment, or exercise by women,
from the employee member, said employer
irrespective of their marital status, on a basis of equality
shall be reimbursed only for each day of "(a) That the employee shall have notified her employer
of men and women, of human rights and fundamental
confinement starting from the tenth calendar of her pregnancy and the probable date of her
freedoms in the political, economic, social, cultural, civil,
day immediately preceding the date of childbirth, which notice shall be transmitted to the SSS
or any other field.
notification to the SSS: in accordance with the rules and regulations it may
provide;
Provided, finally, That the SSS shall
reimburse the employer or pay the "(b) The full payment shall be advanced by the
unemployed member only for confinement employer within thirty (30) days from the filing of the Section 12. Equal Treatment Before the Law. - The State
within the one-year period immediately maternity leave application; shall take steps to review and, when necessary, amend
preceding the date the claim for benefit or and/or repeal existing laws that are discriminatory to women
reimbursement is received by the SSS, within three (3) years from the effectivity of this Act.
"(c) That payment of daily maternity benefits shall be a
except confinement in a hospital in which
bar to the recovery of sickness benefits Provided by this
case the claim for benefit or reimbursement
Act for the same period for which daily maternity
must be filed within one (1) year from the last
benefits have been received;
day of confinement.
Section 13. Equal Access and Elimination of
"(d) That the maternity benefits Provided under this Discrimination in Education, Scholarships, and
"(d) Where the employee member has given
section shall be paid only for the first four (4) deliveries Training. -
the required notification but the employer fails
or miscarriages;
to notify the SSS of the confinement or to file
the claim for reimbursement within the period (a) The State shall ensure that gender stereotypes and
prescribed in this section resulting in the "(e) That the SSS shall immediately reimburse the images in educational materials and curricula are adequately
reduction of the benefit or denial of the claim, employer of one hundred percent (100%) of the amount and appropriately revised. Gender-sensitive language shall
such employer shall have no right to recover of maternity benefits advanced to the employee by the be used at all times. Capacity-building on gender and
the corresponding daily allowance he employer upon receipt of satisfactory proof of such development (GAD), peace and human rights, education for
advanced to the employee member as payment and legality thereof; and teachers, and all those involved in the education sector shall
required in this section. be pursued toward this end. Partnerships between and
among players of the education sector, including the private
"(f) That if an employee member should give birth or suffer
sector, churches, and faith groups shall be encouraged.
"(e)The claim of reimbursement shall be miscarriage without the required contributions having been
adjudicated by the SSS within a period of two remitted for her by her employer to the SSS, or without the
(2) months from receipt thereof: Provided, latter having been previously notified by the employer of the (b) Enrollment of women in nontraditional skills training in
That should no payment be received by the time of the pregnancy, the employer shall pay to the SSS vocational and tertiary levels shall be encouraged.
employer within one (1) month after the damages equivalent to the benefits which said employee
period prescribed herein for adjudication, the member would otherwise have been entitled to.
reimbursement shall thereafter earn simple
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(c) Expulsion and non-readmission of women faculty due to Med Rep sexually abused fellow med rep
pregnant;- outside of marriage shall be outlawed. No school Domingo v Rayala 546 SCRA 90(2008)
shall turn out or refuse admission to a female student solely The evidence on record sufficiently supports the finding of
on the account of her having contracted pregnancy outside sexual abuse against petitioner. In addition to her sworn
of marriage during her term in school. statement to the police, she sufficiently narrated petitioner’s
It is true that this provision calls for a “demand, request or attempt to sexually abuse her in her handwritten letter dated
requirement of a sexual favor.” But it is not necessary that March 23, 1994 addressed to Reynaldo Biscaro. She also
the demand, request or requirement of a sexual favor be narrated the same incident in another letter addressed to the
articulated in a categorical oral or written statement. It may president of the union, Joel Soco. It may be trite to point out
Section 18. Special Leave Benefits for Women. - A
be discerned, with equal certitude, from the acts of the that the findings of a trial court on the credibility of witnesses
woman employee having rendered continuous aggregate
employment service of at least six (6) months for the last offender. Holding and squeezing Domingo’s shoulders, deserve great weight, given the clear advantage of a trial
twelve (12) months shall be entitled to a special leave benefit running his fingers across her neck and tickling her ear, judge over an appellate justice in the appreciation of
of two (2) months with full pay based on her gross monthly having inappropriate conversations with her, giving her testimonial evidence.
compensation following surgery caused by gynecological money allegedly for school expenses with a promise of
disorders. future privileges, and making statements with unmistakable The LA, being in the position to observe the demeanor of
sexual overtones—all these acts of Rayala resound with both the petitioner and Ms. Magat during their testimony,
deafening clarity the unspoken request for a sexual favor. gave more credence to the testimony of Ms. Magat. On the
other hand, aside from his self-serving testimony, petitioner
Bacsin v Wahiman, 553 SCRA 137 was not able to sufficiently contradict the charge of sexual
abuse against him. Moreover, the courts usually give
Contrary to Rayala’s claim, it is not essential that the credence tothe testimony of a woman who is a victim of
demand, request or requirement be made as a condition for sexual assault, because normally no woman would be willing
The formal charge, while not specifically mentioning RA continued employment or for promotion to a higher position. to undergo the humiliation of a public trial and testify on the
7877, The Anti-Sexual Harassment Act of 1995, imputes on It is enough that the respondent’s acts result in creating an details of her ordeal if it be not to condemn an injustice.
the petitioner acts covered and penalized by said law. intimidating, hostile or offensive environment for the
employee. That the acts of Rayala generated an intimidating Sexual harassment is a valid cause for separation from
Contrary to the argument of petitioner, the demand of a and hostile environment for Domingo is clearly shown by the service. As a manager, petitioner enjoyed the full trust and
sexual favor need not be explicit or stated. In Domingo v. common factual finding of the Investigating Committee, the confidence of respondent and his subordinates. By
Rayala, 546 SCRA 90 (2008), it was held, “It is true that this OP and the CA that Domingo reported the matter to an committing sexual abuse against his subordinate, he clearly
provision calls for a ‘demand, request or requirement of a officemate and, after the last incident, filed for a leave of demonstrated his lack of fitness to continue working as a
sexual favor.’ But it is not necessary that the demand, absence and requested transfer to another unit. managerial employee and deserves the punishment of
request, or requirement of a sexual favor be articulated in a dismissal from the service. Formantes vs. Duncan
categorical oral or written statement. It may be discerned, Pharmaceuticals, Phils., Inc., 607 SCRA 269, G.R. No.
with equal certitude, from the acts of the offender.” The CSC 170661 December 4, 2009
found, as did the CA, that even without an explicit demand Since what is before the Court is an administrative case for
from petitioner his act of mashing the breast of AAA was sexual harassment, it is immaterial whether the crime of 1. Male Employees
sufficient to constitute sexual harassment. Moreover, under sexual harassment is malum in se or malum prohibitum.—
AAA even testified that she felt fear at the time petitioner Rayala alleges that the CA erred in holding that sexual
touched her. It cannot then be said that the CSC lacked harassment is an offense malum prohibitum. He argues that
basis for its ruling, when it had both the facts and the law. intent is an essential element in sexual harassment, and REPUBLIC ACT NO. 8187 AN ACT
The CSC found the evidence presented by the complainant since the acts imputed to him were done allegedly without GRANTING PATERNITY LEAVE OF
sufficient to support a finding of grave misconduct. It is basic malice, he should be absolved of the charges against him. SEVEN (7) DAYS WITH FULL PAY TO
that factual findings of administrative agencies, when We reiterate that what is before us is an administrative case ALL MARRIED MALE EMPLOYEES IN
supported by substantial evidence, are binding upon the for sexual harassment. Thus, whether the crime of sexual THE PRIVATE AND PUBLIC SECTORS
Court. harassment is malum in se or malum prohibitum is FOR THE FIRST FOUR (4) DELIVERIES
immaterial. Domingo vs. Rayala, 546 SCRA 90, G.R. No. OF THE LEGITIMATE SPOUSE WITH
Sexually molesting a child is, by any norm, a revolting act 155831 February 18, 2008 WHOM HE IS COHABITING AND FOR
that it cannot but be categorized as a grave offense OTHER PURPOSES.

Formantes v Duncan Pharmaceuticals,


170661 (2009) SECTION 1. Short Title. - This Act shall be known as the
"Paternity Leave Act of 1996".

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SECTION 2. Notwithstanding any law, rules and regulations "(1) A child below fifteen (15) years of age may be child labor. The phrase "worst forms of child labor" shall
to the contrary, every married male employee in the private allowed to work for not more than twenty (20) hours a refer to any of the following:
and public sectors shall be entitled to a paternity leave of week:
seven (7) days with full pay for the first four (4) deliveries of "(1) All forms of slavery, as defined under the
the legitimate spouse with whom he is cohabiting. Provided, That the work shall not be more than four (4) "Anti-trafficking in Persons Act of 2003", or
hours at any given day; practices similar to slavery such as sale and
The male employee applying for paternity leave shall notify trafficking of children, debt bondage and
his employer of the pregnancy of his legitimate spouse and serfdom and forced or compulsory labor,
the expected date of such delivery. For purposes, of this Act, "(2) A child fifteen (15) years of age but below eighteen
including recruitment of children for use in
(18) shall not be allowed to work for more than eight (8)
delivery shall include childbirth or any miscarriage. armed conflict; or
hours a day, and in no case beyond forty (40) hours a
SECTION 3. Definition of Term. - For purposes of this Act, week;
"(2) The use, procuring, offering or exposing
Paternity Leave refers to the benefits granted to a married
of a child for prostitution, for the production of
male employee allowing him not to report for work for seven "(3) No child below fifteen (15) years of age shall be
pornography or for pornographic
(7) days but continues to earn the compensation therefor, on allowed to work between eight o'clock in the evening
performances; or
the condition that his spouse has delivered a child or and six o'clock in the morning of the following day and
suffered a miscarriage for purposes of enabling him to no child fifteen (15) years of age but below eighteen
effectively lend support to his wife in her period of recovery (18) shall be allowed to work between ten o'clock in the "(3) The use, procuring or offering of a child
evening and six o'clock in the morning of the following for illegal or illicit activities, including the
and/or in the nursing of the newly-born child.
day." production and trafficking of dangerous drugs
SECTION 4. The Secretary of Labor and Employment, the and volatile substances prohibited under
existing laws; or
Chairman of the Civil Service Commission and the Secretary "Sec. 12-B. Ownership, Usage and Administration of
of Health shall, within thirty (30) days from the effectivity of the Working Child's Income. - The wages, salaries,
this Act, issue such rules and regulations necessary for the earnings and other income of the working child shall "(4) Work which, by its nature or the
belong to him/her in ownership and shall be set aside circumstances in which it is carried out, is
xxxx primarily for his/her support, education or skills hazardous or likely to be harmful to the
acquisition and secondarily to the collective needs of health, safety or morals of children, such that
the family: Provided, That not more than twenty percent it:
(20%) of the child's income may be used for the
2. Children collective needs of the family.
"a) Debases, degrades or demeans
the intrinsic worth and dignity of a
"The income of the working child and/or the property child as a human being; or
acquired through the work of the child shall be
administered by both parents. In the absence or
Republic Act No. 7610 June 17, "b) Exposes the child to physical,
incapacity of either of the parents, the other parent shall
1992 (AS AMENDED by RA 9231) emotional or sexual abuse, or is
administer the same. In case both parents are absent or
found to be highly stressful
incapacitated, the order of preference on parental
psychologically or may prejudice
authority as provided for under the Family Code shall
AN ACT PROVIDING FOR STRONGER morals; or
apply.
DETERRENCE AND SPECIAL
PROTECTION AGAINST CHILD ABUSE, "c) Is performed underground,
"Sec. 12-C. Trust Fund to Preserve Part of the Working
EXPLOITATION AND underwater or at dangerous
Child's Income. - The parent or legal guardian of a
DISCRIMINATION, AND FOR OTHER heights; or
working child below eighteen (18) years of age shall set
PURPOSES up a trust fund for at least thirty percent (30%) of the
earnings of the child whose wages and salaries from "d) Involves the use of dangerous
work and other income amount to at least two hundred machinery, equipment and tools
thousand pesos (P200,000.00) annually, for which such as power-driven or explosive
Section 3. The same Act, as amended, is hereby further he/she shall render a semi-annual accounting of the power-actuated tools; or
amended by adding new sections to be denominated as fund to the Department of Labor and Employment, in
Sections 12-A, 12-B, 12-C, and 12-D to read as follows: compliance with the provisions of this Act. The child
shall have full control over the trust fund upon reaching "e) Exposes the child to physical
danger such as, but not limited to
"Sec. 2-A. Hours of Work of a Working Child. - Under the age of majority.
the dangerous feats of balancing,
the exceptions provided in Section 12 of this Act, as physical strength or contortion, or
amended: "Sec. 12-D. Prohibition Against Worst Forms of Child which requires the manual
Labor. - No child shall be engaged in the worst forms of transport of heavy loads; or
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"f) Is performed in an unhealthy ARTICLE 156. Mandatory Facilities. — Suitable rst-aid
environment exposing the child to facilities shall be made available for workers performing
hazardous working conditions, night work, including arrangements where such workers,
5. Night workers
elements, substances, co-agents or where necessary, can be taken immediately to a place for
processes involving ionizing, appropriate treatment. The employers are likewise
radiation, fire, flammable required to provide safe and healthful working conditions
substances, noxious components
LABOR CODE and adequate or reasonable facilities such as sleeping or
and the like, or to extreme
resting quarters in the establishment and transportation
temperatures, noise levels, or
vibrations; or from the work premises to the nearest point of their
residence subject to exceptions and guidelines to be
ARTICLE 154. Coverage. — This chapter shall apply to provided by the DOLE.
"g) Is performed under particularly
all persons, who shall be employed or permitted or
difficult conditions; or ARTICLE 157. Transfer. — Night workers who are certi ed
suffered to work at night,
as un t for night work, due to health reasons, shall be
"h) Exposes the child to biological (a) except those employed in transferred, whenever practicable, to a similar job for
agents such as bacteria, fungi, (b) agriculture, which they are fit to work.
viruses, protozoans, nematodes (c) stock raising,
and other parasites; or (d) shing, If such transfer to a similar job is not practicable, these
(e) maritime transport and inland navigation, workers shall be granted the same bene ts as other
workers who are unable to work, or to secure employment
"i) Involves the manufacture or
handling of explosives and other during a period of not less than seven (7) consecutive during such period.
pyrotechnic products." hours, including the interval from midnight to ve o'clock in
the morning, to be determined by the Secretary of Labor A night worker certi ed as temporarily un t for night work
and Employment, after consulting the workers' shall be given the same protection against dismissal or
Section 5. Section 14 of the same Act is hereby amended to notice of dismissal as other workers who are prevented
representatives/labor organizations and employers.
read as follows: from working for reasons of health.
"Night worker" means any employed person whose work
"Sec. 14. Prohibition on the Employment of Children in requires performance of a substantial number of hours of ARTICLE 158. Women Night Workers. — Measures shall
Certain Advertisements. - No child shall be employed night work which exceeds a specifed limit. This limit shall be taken to ensure that an alternative to night work is
as a model in any advertisement directly or indirectly be fixed by the Secretary of Labor after consulting the available to women workers who would otherwise be
promoting alcoholic beverages, intoxicating drinks, workers' representatives/labor organizations and called upon to perform such work:
tobacco and its byproducts, gambling or any form of employers.
violence or pornography." (a) Before and after childbirth, for a period of at
ARTICLE 155. Health Assessment. — At their request, least sixteen (16) weeks, which shall be
divided between the time before and after
4. Solo parents workers shall have the right to undergo a health
childbirth;
assessment without charge and to receive advice on how
to reduce or avoid health problems associated with their (b) For additional periods, in respect of which a
work: medical certi cate is produced stating that said
REPUBLIC ACT NO. 8972 additional periods are necessary for the health
(a) Before taking up an assignment as a night of the mother or child:
worker;
AN ACT PROVIDING FOR BENEFITS (1) During pregnancy;
AND PRIVILEGES TO SOLO PARENTS (b) At regular intervals during such an
AND THEIR CHILDREN, assignment; and (2) During a speci ed time beyond the
period, after childbirth is xed
APPROPRIATING FUNDS THEREFOR
(c) If they experience health problems during pursuant to subparagraph (a)
AND FOR OTHER PURPOSES such an assignment which are not caused by above, the length of which shall be
factors other than the performance of night determined by the DOLE after
work. consulting the labor organizations
and employers. IDTSEH
Section 8. Parental Leave. - In addition to leave privileges With the exception of a nding of un tness for night work,
under existing laws, parental leave of not more than seven the ndings of such assessments shall not be transmitted During the periods referred to in this article:
(7) working days every year shall be granted to any solo to others without the workers' consent and shall not be
parent employee who has rendered service of at least one used to their detriment. (i) A woman worker shall not be
(1) year. dismissed or given notice of
dismissal, except for just or
LABOR LAW I under Atty. Nolasco | COMPILATION OF DOCTRINES AND LAWS | DLSU law | Quebal
authorized causes provided ARTICLE 162. [156] First-Aid Treatment. — Every employees exceeds three hundred
for in this Code that are not employer shall keep in his establishment such first-aid (300).
connected with pregnancy, medicines and equipment as the nature and conditions of
childbirth and childcare a In cases of hazardous workplaces,
work may require, in accordance with such regulations as i. no employer shall engage the services
responsibilities.
the Department of Labor and Employment shall prescribe. of a physician or a dentist who cannot
(ii) A woman worker shall not
The employer shall take steps for the training of a
stay in the premises of the
lose the bene ts regarding establishment
her status, seniority, and sufficient number of employees in first-aid treatment.
1. for at least two (2) hours, in
access to promotion which the case of those engaged on
may attach to her regular ARTICLE 163. [157] Emergency Medical and Dental
Services. 111 — It shall be the duty of every employer to part-time basis,
night work position.
furnish his employees in any locality with free medical and 2. and not less than eight (8)
Pregnant women and nursing mothers may be allowed to dental attendance and facilities consisting of: hours, in the case of those
work at night only if a competent physician, other than the employed on full-time basis.
company physician, shall certify their tness to render night (a) The services of a full-time registered
work, and specify, in the case of pregnant employees, the nurse when the number of employees b Where the undertaking is non-
period of the pregnancy that they can safely work. exceeds fty (50) but not more than two hazardous in nature, the physician and dentist
hundred (200) may be engaged on retained basis, subject to
The measures referred to in this article may include such regulations as the Secretary of Labor and
transfer to day work where this is possible, the provision of a except when the employer does not
maintain hazardous workplaces, in Employment may prescribe to insure immediate
social security benefits or an extension of maternity leave. availability of medical and dental treatment and
which case, the services of a
graduate rst-aider shall be provided attendance in case of emergency.
The provisions of this article shall not have the effect of
for the protection of workers, where
reducing the protection and bene ts connected with no registered nurse is available. ARTICLE 164. [158] When Emergency Hospital Not
maternity leave under existing laws. Required. — The requirement for an emergency hospital
b The Secretary of Labor and or dental clinic shall not be applicable in case there is a
ARTICLE 159. Compensation. — The compensation for Employment shall provide by hospital or dental clinic which is accessible from the
night workers in the form of working time, pay or similar appropriate regulations the employer's establishment and he makes arrangement for
benefits shall recognize the exceptional nature of night services that shall be required
the reservation therein of the necessary beds and dental
work. where the number of employees
does not exceed fty (50) and shall facilities for the use of his employees.
ARTICLE 160. Social Services. — Appropriate social determine by appropriate order,
hazardous workplaces for purposes ARTICLE 165. [159] Health Program. — The physician
services shall be provided for night workers and, where
of this Article; engaged by an employer shall, in addition to his duties
necessary, for workers performing night work.
under this Chapter, develop and implement a
ARTICLE 161. Night Work Schedules. — Before (b) The services of a comprehensive occupational health program for the
introducing work schedules requiring the services of night benefit of the employees of his employer.
a full-time registered nurse,
workers, the employer shall consult the workers'
ARTICLE 166. [160] Qualications of Health Personnel. —
representatives/labor organizations concerned on the b a part-time physician and dentist, The physicians, dentists and nurses employed by
details of such schedules and the forms of organization of
employers pursuant to this Chapter shall have the
night work that are best adapted to the establishment and c and an emergency clinic,
necessary training in industrial medicine and occupational
its personnel, as well as on the occupational health
d when the number of employees safety and health. The Secretary of Labor and
measures and social services which are required. In
exceeds two hundred (200) but not Employment, in consultation with industrial, medical, and
establishments employing night workers, consultation
more than three hundred (300); and occupational safety and health associations, shall
shall take place regularly.
establish the qualifications, criteria and conditions of
(c) The services of a employment of such health personnel.
a full-time physician, dentist and a
ARTICLE 167. [161] Assistance of Employer. — It shall
full-time registered nurse as well as
a dental clinic be the duty of any employer to provide all the necessary
G. Health and Safety
assistance to ensure the adequate and immediate medical
b and an in rmary or emergency and dental attendance and treatment to an injured or sick
hospital with one bed capacity for employee in case of emergency.
every one hundred (100)
Labor code employees when the number of

LABOR LAW I under Atty. Nolasco | COMPILATION OF DOCTRINES AND LAWS | DLSU law | Quebal
full-time nurses as regular employees of a company An employment shall be deemed to be casual if it is not
Ocean Builders v Sps. Cubcub,150898 employing not less than 50 workers. covered by the preceding paragraph:
(2009)
Provided, That any employee who has rendered
Under the foregoing provision, Shangri-la, which at least one year of service, whether such service is
employs more than 200 workers, is mandated to furnish its continuous or broken, shall be considered a regular
employees with the services of a full-time registered nurse, employee with respect to the activity in which he is
a part-time physician and dentist, and an emergency clinic employed and his employment shall continue while such
In the present case, there is no allegation that the which means that it should provide or make available such activity exists.
company premises are hazardous. Neither is there any medical and allied services to its employees, not
allegation on the number of employees the company has. If necessarily to hire or employ a service provider. ARTICLE 296. [281] Probationary Employment. —
Haos testimony[4] would be believed, the company had only Probationary employment shall not exceed six (6) months
seven regular employees and 20 contractual employees ─ still The term full-time in Art. 157 cannot be construed
from the date the employee started working,
short of the minimum 50 workers that an establishment must as referring to the type of employment of the person engaged
have for it to be required to have a full-time registered nurse. to provide the services, for Article 157 must not be read
unless it is covered by an apprenticeship agreement
alongside Art. 280[9] in order to vest employer-employee
relationship on the employer and the person so engaged. stipulating a longer period.
The Court can thus only determine whether the
actions taken by petitioners when Bladimir became ill The phrase services of a full-time registered nurse should thus
The services of an employee who has been engaged on a
amounted to the necessary assistance to ensure adequate be taken to refer to the kind of services that the nurse will
render in the companys premises and to its employees, not probationary basis may be terminated
and immediate medical . . . attendance to Bladimir as required
under Art. 161 of the Labor Code. the manner of his engagement.
a for a just cause or
As found by the trial court and borne by the records, H. Types of employees b when he fails to qualify as a regular employee
petitioner Haos advice for Bladimir to, as he did, take a 3-day i. in accordance with reasonable standards
1. Regular
rest and to later have him brought to the nearest hospital ii. made known by the employer to the
2. Project/seasonal employee
constituted adequate and immediate medical attendance that
he is mandated, under Art. 161, to provide to a sick employee 3. Probationary iii. at the time of his engagement.
in an emergency. 4. Casual
An employee who is allowed to work after a probationary
Chicken pox is self-limiting. Hao does not appear to period shall be considered a regular employee.
have a medical background. He may not be thus expected to
have known that Bladimir needed to be brought to a hospital Labor Code
with better facilities than the Caybiga Hospital, contrary to
appellate courts ruling. Fuji Television v Espiritu, 204944-55
(2014)
AT ALL EVENTS, the alleged negligence of Hao
ARTICLE 295. [280] Regular and Casual Employment. —
cannot be considered as the proximate cause of the death of
The provisions of written agreement to the contrary
Bladimir. Proximate cause is that which, in natural and
continuous sequence, unbroken by an efficient intervening notwithstanding and regardless of the oral agreement of
the parties, an employment shall be deemed to be regular Fuji’s argument that Arlene was an independent contractor
cause, produces injury, and without which, the result would
not have occurred.[5] An injury or damage is proximately under a fixed-term contract is contradictory. Employees
caused by an act or failure to act, whenever it appears from a where the employee has been engaged to under fixed-term contracts cannot be independent
the evidence in the case that the act or omission played perform activities which are usually necessary or contractors because in fixed-term contracts, an employer-
a substantial part in bringing about or actually causing the desirable in the usual business or trade of the employee relationship exists. The test in this kind of contract
injury or damage, and that the injury or damage was either employer, is not the necessity and desirability of the employee’s
a direct result or a reasonably probable consequence of the activities, “but the day certain agreed upon by the parties for
act or omissio except the commencement and termination of the employment
relationship.”
b where the employment has been fixed for a
specific project For regular employees, the necessity and desirability of their
c or undertaking the completion or termination of work in the usual course of the employer’s business are the
Escanias v Shangri-La 178827 (2009) which has been determined at the time of the determining factors. On the other hand, independent
engagement of the employee contractors do not have employer-employee relationships
d or where the work or service to be performed is with their principals.
seasonal in nature and the employment is for the
The Court holds that, contrary to petitioners
postulation, Art. 157 does not require the engagement of duration of the season.
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The test for determining regular employment is whether continuous or broken, with respect to the For an employee to be validly categorized as a project
there is a reasonable connection between the employee’s activity in which he is employed. employee, it is necessary that
activities and the usual business of the employer. Article 280
provides that the nature of work must be “necessary or In Integrated Contractor and Plumbing Works, Inc. v. 1. the specific project or undertaking had been identified
desirable in the usual business or trade of the employer” as National Labor Relations Commission, 466 SCRA 265 2. and its period and completion date determined and
the test for determining regular employment. (2005), we held that the test to determine whether made known to the employee at the time of his
employment is regular or not is the reasonable connection engagement.
As stated in ABS-CBN Broadcasting Corporation v. between the particular activity performed by the employee in
Nazareno, 503 SCRA 204 (2006): In determining whether an relation to the usual business or trade of the employer.
employment should be considered regular or non-regular, This provision ensures that the employee is completely
the applicable test is the reasonable connection between the If the employee has been performing the job for at least one apprised of the terms of his hiring and the corresponding
particular activity performed by the employee in relation to year, even if the performance is not continuous or merely rights and obligations arising from his undertaking.
the usual business or trade of the employer. The standard, intermittent, the law deems the repeated and continuing
supplied by the law itself, is whether the work undertaken is need for its performance as sufficient evidence of the Notably, the petitioner’s service contract with Robinsons was
necessary or desirable in the usual business or trade of the necessity, if not indispensability of that activity to the from January 1 to December 31, 2008.
employer, a fact that can be assessed by looking into the business.
The respondents were only asked to sign their employment
nature of the services rendered and its relation to the general
Clearly, with more than 20 years of service, Villegas, without contracts for their deployment with Robinsons halfway
scheme under which the business or trade is pursued in the
doubt, passed this test to attain employment regularity. through 2008, when the petitioner’s service contract was
usual course. It is distinguished from a specific undertaking
about to expire.
that is divorced from the normal activities required in carrying
on the particular business or trade. We find the timing of the execution of the respondents’
FVR Skills and Services v Seva, 200857 respective employment contracts to be indicative of the
An employee can be a regular employee with a fixed-term
(2014) petitioner’s calculated plan to evade the respondents’ right to
contract. The law does not preclude the possibility that a
security of tenure, to ensure their easy dismissal as soon as
regular employee may opt to have a fixed-term contract for
the Robinsons’ contract expired.
valid reasons. This was recognized in Brent School, Inc. v.
Zamora, 181 SCRA 702 (1990): For as long as it was the The attendant circumstances cannot but raise doubts as to
Article 280 (now Article 294) of the Labor Code governs the
employee who requested, or bargained, that the contract the petitioner’s good faith.
determination of whether an employee is a regular or a
have a “definite date of termination,” or that the fixed-term
project employee. Under this provision, there are two kinds
contract be freely entered into by the employer and the
of regular employees, namely: (1) those who were engaged
employee, then the validity of the fixed-term contract will be
to perform activities which are usually necessary or desirable
upheld. Manalo v. TSN Philippines, 208567
in the usual business or trade of the employer; and (2) those
(2014)
Even probationary employees are entitled to the right to casual employees who became regular after one year of
security of tenure. This was explained in Philippine Daily service, whether continuous or broken, but only with respect
Inquirer, Inc. v. Magtibay, Jr., 528 SCRA 355 (2007): Within to the activity for which they have been hired. We distinguish
the limited legal six-month probationary period, probationary these two types of regular employees from a project
Additionally, a project employee is one whose termination of
employees are still entitled to security of tenure. employee, or one whose employment was fixed for a specific
his employment contract is reported to the DOLE everytime
project or undertaking, whose completion or termination had
the project for which he was engaged has been completed.
been determined at the time of engagement.
The National Labor Relations Commission (NLRC) was
Hacienda Leddy v Villegas, 179654 The primary standard in determining regular employment is
correct in saying that in the absence of proof that the
(2014) the reasonable connection between the particular activity
subsequent employment of petitioners continued to be on a
performed by the employee and the employer’s business or
project-to-project basis under a contract of employment,
trade.
petitioners were considered to have become regular
This connection can be ascertained by considering the employees
Art. 280 of the Labor Code, describes a regular employee as
nature of the work performed and its relation to the scheme
one who is either: Petitioners’ successive reengagement in order to perform the
of the particular business, or the trade in its entirety. Guided
same kind of work firmly manifested the necessity and
(1) engaged to perform activities which are by this test, we conclude that the respondents’ work as
desirability of their work in the usual business of TNS as a
necessary or desirable in the usual business janitors, service crews and sanitation aides, are necessary or
market research facility
or trade of the employer; and desirable to the petitioner’s business of providing janitorial
(2) those casual employees who have rendered and manpower services to its clients as an independent In sum, petitioners are deemed to have become regular
at least one year of service, whether contractor. employees. As such, the burden of proving the legality of
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their dismissal rests upon TNS. Having failed to discharge termination of which occurs upon the expiration of said However, seasonal workers who have worked for one
such burden of proving a just or authorized cause, TNS is period irrespective of the existence of just cause and season only may not be considered regular employees.
liable for illegal dismissal. regardless of the activity the employee is called upon to
perform.— Petitioners also assert that the sugarcane cultivation covers
only a period of six months, thus, disproving the allegation of
Thus, under the above Brent School, Inc. v. Zamora, 181 the respondent that she worked for 11 months a year for 25
Basan v. Coca-cola bottlers, 174365-66 SCRA 702 (1990), doctrine, while it was not expressly years. This Court has classified farm workers as regular
(2015) mentioned in the Labor Code, this Court has recognized a seasonal employees who are called to work from time to
fixed-term type of employment embodied in a contract time and the nature of their relationship with the employer is
specifying that the services of the employee shall be such that during the off season, they are temporarily laid off;
engaged only for a definite period, the termination of which but reemployed during the summer season or when their
As for the primordial issue in this case, it must be noted that occurs upon the expiration of said period irrespective of the services may be needed.
the same has already been resolved in Magsalin v. National existence of just cause and regardless of the activity the
Organization of Working Men, 403 SCRA 199 (2003), employee is called upon to perform. Respondent, therefore, as a farm worker is only a seasonal
where-in this Court has categorically declared that the nature employee. Since petitioners provided that the cultivation of
of work of route helpers hired by Coca-Cola Bottlers Considering, however, the possibility of abuse by employers sugarcane is only for six months, respondent cannot be
Philippines, Inc. is necessary and desirable in its usual in the utilization of fixed-term employment contracts, this considered as regular employee during the months when
business or trade thereby qualifying them as regular Court, in Brent, laid down the following criteria to prevent the there is no cultivation.
employees. circumvention of the employee’s security of tenure:

The “pernicious practice” of engaging employees for a fixed 1. The fixed period of employment was knowingly and
period short of the six (6)-month probationary period of voluntarily agreed upon by the parties without any force, Paz v Norther Tobacco Redrying, 199554
employment, and again, on a day-to-day basis thereafter, duress, or improper pressure being brought to bear (2015)
mocks the law upon the employee and absent any other
circumstances vitiating his consent; or
Simply stated, regular employees are classified into: 2. It satisfactorily appears that the employer and the
employee dealt with each other on more or less equal A seasonal sorter from 1974-2003 who is rehired every
1. regular employees by nature of work; and terms with no moral dominance exercised by the former season is a regular employee.
2. regular employees by years of service. or the latter.
Same; Regular Seasonal Employees; The workers of La
The former refers to those employees who perform a Same; Same; Route Helpers; Respondent’s act of hiring and Union Tobacco Redrying Corporation in Abasolo v. National
particular activity which is necessary or desirable in the usual rehiring petitioners for periods short of the legal probationary Labor Relations Commission, 346 SCRA 293 (2000), were
business or trade of the employer, regardless of their length period evidences its intent to thwart petitioner’s security of considered regular seasonal employees since they
of service; while the latter refers to those employees who tenure, especially in view of an awareness that ordinary performed services necessary and indispensable to the
have been performing the job, regardless of the nature workers, such as petitioners herein, are never on equal business for over twenty (20) years, even if their work was
thereof, for at least a year. terms with their employers.— only during tobacco season.—
Petitioners, in this case, fall under the first kind of regular
employee above. As route helpers who are engaged in the
service of loading and unloading softdrink products of Hacienda Cataywa v Lorenzo, 179640 Dela Cruz v Maersk Filipinas Crewing,
respondent company to its various delivery points, which is (2015) 551 SCRA 284
necessary or desirable in its usual business or trade,
petitioners are considered as regular employees.

That they merely rendered services for periods of less than a Seasonal farmworker who worked for only 6 months cannot Seafarers are not covered by the term regular employment,
year is of no moment since for as long as they were be considered as a regular employee. as defined under Article 280 of the Labor Code—they are
performing activities necessary to the business of considered contractual employees whose rights and
respondent, they are deemed as regular employees under Farm workers generally fall under the definition of seasonal obligations are governed primarily by the Philippine
the Labor Code, irrespective of the length of their service. employees. It was also consistently held that seasonal Overseas Employment Administration (POEA) Standard
employees may be considered as regular employees when Employment Contract for Filipino Seamen (POEA Standard
Same; Same; Fixed-Term Employees; While it was not they are called to work from time to time. They are in regular Employment Contract), the Rules and Regulations
expressly mentioned in the Labor Code, the Supreme Court employment because of the nature of the job, and not Governing Overseas Employment, and, more importantly, by
(SC) has recognized a fixed-term type of employment because of the length of time they have worked. R.A. No. 8042; It is an accepted maritime industry practice
embodied in a contract specifying that the services of the
that the employment of seafarers is for a fixed period only.—
employee shall be engaged only for a definite period, the
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Even the POEA Standard Employment Contract itself “7.4 The EMPLOYEE acknowledges that the A school personnel
mandates that in no case shall a contract of employment EMPLOYER entered into this Contract upon his
concerning seamen exceed 12 months. It is an accepted express representation that he/she is qualified and 1. who has successfully undergone the probationary
maritime industry practice that the employment of seafarers possesses the skills necessary and desirable for the period herein specified
is for a fixed period only. The Court acknowledges this to be position indicated herein. Thus, the EMPLOYER is 2. and who is fully qualified under existing rules and
for the mutual interest of both the seafarer and the employer. hereby granted the right to pre-terminate this standards of the school
Contract within the first three (3) months of its
Seafarers cannot stay for a long and indefinite period of time
duration upon failure of the EMPLOYEE to meet and shall be considered permanent.
at sea as limited access to shore activity during their
pass the qualifications and standards set by the
employment has been shown to adversely affect them. EMPLOYER and made known to the EMPLOYEE
Furthermore, the diversity in nationality, culture and prior to execution hereof. Failure of the EMPLOYER
language among the crew necessitates the limitation of the to exercise its right hereunder shall be without prejudice 2008 Manual of Regulations for Private
period of employment. to the automatic termination of the EMPLOYEE’s higher education
employment upon the expiration of this Contract or
While we recognize that petitioner was a registered member cancellation thereof for other causes provided herein
of the Associated Marine Officers and Seamen’s Union of and by law."15 (Emphasis supplied)”
the Philippines which had a CBA with respondent Elite
Section 35. Minimum Faculty Qualifications. The
Shipping A.S. providing for a probationary period of
Like those in Villanueva and Servidad, the present contracts minimum qualifications of a faculty in a higher education
employment, the CBA cannot override the provisions of the also provide for two periods. Aside from the fixed one-year institution shall be as follows:
POEA Standard Employment Contract. The law is read into, term set in paragraph 1, paragraph 7.4 provides for a three-
and forms part of, contracts. And provisions in a contract are month period during which petitioner has the right to pre- 1) For undergraduate programs:
valid only if they are not contrary to law, morals, good terminate the employment for the "failure of the employees to a. Holder of a master’s degree, to teach mainly
customs, public order or public policy. meet and pass the qualifications and standards set by the in his major filed
employer and made known to the employee prior to" their b. and where applicable, a holder of
employment. Thus, although couched in ambiguous
appropriate professional license requiring at
language, paragraph 7.4 refers in reality to a probationary
least a bachelor’s degree for the professional
Lynvil fishing enterprises v Ariola, 181974 period.
courses.
(2012)
c. However, in specific fields, where there is
dearth of holders of Master’s degree, a holder
of professional license requiring at least a
Labor Law; Security of Tenure; Court has recognized the
Textually, the provision that: “NA ako ay sumasang-ayon na bacherlor’s degree may be qualified to teach.
validity of fixed-term employment contracts in a number of
maglingkod at gumawa ng mga gawain sang-ayon sa Any deviation from this requirement will be
cases, but it has consistently emphasized that when the
patakarang “por viaje” na magmumula sa pagalis sa Navotas subject to regulation by the commission.
circumstances of a case show that the periods were imposed
papunta sa pangisdaan at pagbabalik sa pondohan ng lantsa d. For Physical Education: A holder of a degree
to block the acquisition of security of tenure, they should be
sa Navotas, Metro Manila” is for a fixed period of in Bachelor of Science in Physical Education,
struck down for being contrary to law, morals, good customs,
employment. with major or minor in physical education, or
public order or public policy
any other bachelor’s degree with certificate in
In the context, however, of the facts that: physical education

1. the respondents were doing tasks necessarily to


Teachers e. For Music Education: A holder of a degree in
Bachelor of Music, or Bachelor of Science,
Lynvil’s fishing business with positions ranging from with major or minor in music, or any other
captain of the vessel to bodegero; bachelor’s degree with certificate in music.
2. after the end of a trip, they will again be hired for 2) For graduate programs:
another trip with new contracts; and 2010 Manual of Regulations for Private a. For the master’s program: There shall be at
3. this arrangement continued for more than ten years, schools least one (1) full-time faculty who are
master’s degree holders in the discipline.
the clear intention is to go around the security of tenure of b. For professional master’s program: A holder
the respondents as regular employees. of at least a professional master’s degree.
Section 63. Probationary period; Regular or Permanent Faculty complement required in specific fields
status. shall be defined in the policies and standards
set by the Commission specific to the field.
1. A probationary period of not more than 3 years in the
Innodata v Quejada-Lopez, 162839 c. For doctoral program: The shall be at least
case of the school teaching personnel and
(2006) three (3) full-time faculty members who are
2. Not more than 6 months for non-teaching personnel
doctoral degree holders, and who have
shall be required for employment in all private schools.
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published research works in refereed status. In University of Santo Tomas v. National Labor Upon expiration of their contract of employment, academic
journal(s) in the discipline Relations Commission the Court en banc said that under personnel on probation cannot automatically claim security
d. For professional doctoral program: A holder Policy Instructions No. 11 issued by the Department of Labor of tenure and compel their employers to renew their
of a professional doctoral degree. Faculty and Employment, “the probationary employment of employment contracts. In the instant case, petitioner, did not
complement required shall be defined in the professors, instructors and teachers shall be subject to the attain permanent status and was not illegally dismissed. As
policies and standards set by the standards established by the Department of Education and found by the NLRC, her contract merely expired.
Commission specific to the field. Culture.” Said standards are embodied in paragraph 75 (now
Section 93) of the Manual of Regulations for Private Schools.
Section 36. Full-time and Part-time Faculty. As a general
rule, all private higher education institutions shall employ full- Mt. Carmel College v NLRC, 117514
time faculty or academic personnel consistent with the levels (1996)
of instruction. Same; Same; The manual provides that full-time teachers
who have satisfactorily completed their probationary period
A full-time faculty or academic personnel is one who meets shall be considered regular or permanent; Requisites to
all of the following requirements: Acquire Permanent Employment or Security of Tenure.— In the cases of Espiritu Santo Parochial School vs. NLRC
Section 93 of the 1992 Manual of Regulations for Private and Colegio San Agustin vs. NLRC, the court recognized the
1. Who possesses at least the minimum academic Schools provides that full-time teachers who have distinction between a calendar year and a school year.
qualifications prescribed under this manual for all satisfactorily completed their probationary period shall be
academic personnel; considered regular or permanent. Moreover, for those In Espiritu Santo Parochial School, we held: x x x the
2. Who is paid monthly or hourly, based on the regular teaching in the tertiary level, the probationary period shall not petitioners can not talk of a “three-year probationary
teaching loads as provided for in the policies, rule and be more than six consecutive regular semesters of employment expiring each school year.” If it expires per
standards of the Commission and the institution; satisfactory service. school year, it is not a three-year period.
3. Who devotes not less than eight (8) hours of work a day
to the school; The requisites to acquire permanent employment, or security Then in Colegio San Agustin, we said: x x x As applied to
4. Who have no other remunerative occupation elsewhere of tenure, are private school teachers, the probationary period is three
requiring regular hours of work, except when permitted years as provided in the Manual of Regulations for Private
by the higher education institution; and 1. the teacher is a full-time teacher; Schools. It must be stressed that the law speaks of three
5. Who is not teaching full-time in any other higher 2. the teacher must have rendered three consecutive years not three school years. x x x
education institution. years of service; and
3. such service must have been satisfactory. Needless to say, a calendar year consists of twelve (12)
Section 117. Probationary period. An academic teaching months, while a school year consists only of ten (10) months.
personnel, who does not possess the minimum academic As previously held, a part-time teacher cannot acquire A school year begins in June of one calendar year and ends
qualifications prescribed under section 35 and 36 of this permanent status. Only when one has served as a full-time in March of the succeeding calendar year.
manual shall be considered as part-time employee, and teacher can he acquire permanent or regular status. The
therefore cannot avail of the status and privileges of a petitioner was a part-time lecturer before she was appointed Public respondent therefore erred in finding that private
probationary employment. A part-time employee cannot as a full-time instructor on probation. As a part-time lecturer, respondent’s probationary employment was supposed to end
acquire regular permanent status, and hence, may be her employment as such had ended when her contract in June 1992. The contract clearly states the duration of
terminated when a qualified teacher becomes available. expired. Thus, the three semesters she served as part-time private respondent’s term—it shall begin at the opening of
lecturer could not be credited to her in computing the number school year 1989-1990 (i.e., June 1989) and shall end at the
The probationary employment of academic teaching of years she has served to qualify her for permanent status. closing of school year 1991-1992 (i.e., March, 1992). Hence,
personnel shall not be more than a period of six (6) petitioners are not obliged to pay private respondent her
consecutive semesters or nine (9) consecutive trimesters of Completing the probation period does not automatically salary for the months of April, May and June as her
satisfactory service, as the case may be qualify her to become a permanent employee of the employment already ceased in March, in accordance with
university. Petitioner could only qualify to become a the provisions of her employment contract.
permanent employee upon fulfilling the reasonable
standards for permanent employment as faculty member.
Lacuesta v Ateneo de Manila, 477 SCRA Consistent with academic freedom and constitutional
217 (2005) autonomy, an institution of higher learning has the I. Labor-only v Legitimate job contractor
prerogative to provide standards for its teachers and
determine whether these standards have been met. At the
end of the probation period, the decision to re-hire an
The Manual of Regulations for Private Schools, and not the employee on probation, belongs to the university as the Labor Code
Labor Code, determines whether or not a faculty member in employer alone.
an educational institution has attained regular or permanent

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ARTICLE 106. Contractor or Subcontractor. — Whenever with his contractor or subcontractor for any violation of any job, work or service within a definite or predetermined period,
an employer enters into a contract with another person for provision of this Code. For purposes of determining the regardless of whether such job, work or service is to be
the performance of the former's work, the employees of extent of their civil liability under this Chapter, they shall performed or completed within or outside the premises of the
the contractor and of the latter's subcontractor, if any, shall be considered as direct employers. principal.
be paid in accordance with the provisions of this Code.
(d) “Contractor” refers to any person or entity, including a
In the event that the contractor or subcontractor fails to cooperative, engaged in a legitimate contracting or
pay the wages of his employees in accordance with this Department Order 18-A, Series of 2011 subcontracting arrangement providing either services, skilled
Code, the employer shall be jointly and severally liable RULES IMPLEMENTING ARTICLES 106 workers, temporary workers, or a combination of services to a
with his contractor or subcontractor to such employees to TO 109 OF THE LABOR CODE, AS principal under a Service Agreement.
the extent of the work performed under the contract, in the AMENDED
same manner and extent that he is liable to employees (e) “Contractor’s employee” includes one employed by a
directly employed by him. contractor to perform
or complete a job, work, or service pursuant to a Service
The Secretary of Labor and Employment may, by Section 1. Guiding principles. Contracting and Agreement with a principal.
appropriate regulations, restrict or prohibit the contracting- subcontracting arrangements are expressly allowed by law
out of labor to protect the rights of workers established and are subject to regulations for the promotion of
under this Code. In so prohibiting or restricting, he may employment and the observance of the rights of workers to It shall also refer to regular employees of the contractor whose
just and humane conditions of work, security of tenure, self- functions are not dependent on the performance or
make appropriate distinctions between labor-only
organization and collective bargaining. Labor-only contracting completion of a specific job, work or service within a definite
contracting and job contracting as well as differentiations
as defined herein shall be prohibited. period of time, i.e., administrative staff.
within these types of contracting and determine who
among the parties involved shall be considered the
employer for purposes of this Code, to prevent any Section 2. Coverage. These Rules shall apply to all parties (f) “In-house agency” refers to a contractor which is owned,
violation or circumvention of any provision of this Code. of contracting and subcontracting arrangements where managed, or controlled directly or indirectly by the principal or
employer-employee relationships exist. It shall also apply to one where the principal owns/represents any share of stock,
There is "labor-only" contracting where the person cooperatives engaging in contracting or subcontracting and which operates solely or mainly for the principal.
supplying workers to an employer does not have arrangements.
substantial capital or investment in the form of tools, xxx
equipment, machineries, work premises, among others, Contractors and subcontractors referred to in these Rules are
and the workers recruited and placed by such person are prohibited from engaging in recruitment and placement (h) “Principal” refers to any employer, whether a person or
performing activities which are directly related to the activities as defined in Article 13(b) of the Labor Code, entity, including government agencies and government-
principal business of such employer. In such cases, the whether for local or overseas employment. owned and controlled-corporations, who/which puts out or
person or intermediary shall be considered merely as an farms out a job, service or work to a contractor.
agent of the employer who shall be responsible to the Section 3. Definition of terms. The following terms as used
workers in the same manner and extent as if the latter in these Rules, shall mean: (i) “Right to control” refers to the right reserved to the
were directly employed by him.
person for whom the services of the contractual workers are
(a) “Bond/s” refers to the bond under Article 108