BOOK 1 AZUCENA Must command adequate resources and acquire capable machinery for effective and

sustained implementation
GENERAL PROVISIONS
Article 1: NAME OF DECREE
Article 2: DATE OF EFFECTIVITY
COMMENTS AND CASES
1. LABOR LEGISLATION; DEFINITIONS
 Broadly divided into labor standards and labor relations
 Labor standards law is that which sets out the minimum terms, conditions, and
benefits of EMYPT that ERs must provide and comply with and to which EEs are
entitled to as a matter of right.
 Labor relations law is that which defines the status, rights and duties, and the
institutional mechanisms, that govern the individual and collective interactions of
ERs, EEs or their representatives.
Labor is understood as physical toil, although it does not necessarily involve the application
of skill. Skill, by dictionary definition, is the familiar knowledge of any art or science, united
with readiness and dexterity in execution or performance or in the application of the science
or art to practical purposes.
Work is broader than labor as “work” covers all forms of physical or mental exertion, or both
combined, for the attainment of some object other than recreation or amusement per se.
There should be popular participation in national policy making through what is now
called tripartism
10. RELATED LAWS
10.1. The Civil Code
Article 19 – Every person must in the exercise of his rights and in the
performance of his duties, act with justice, give everyone his due, and observe honesty and
good faith.
Article 20 – Every person who contrary to law, willfully or negligently causes
damage to another, shall compensate the latter for the same.
Article 21 – Any person who willfully causes loss of injury to another in a
manner that is contrary to morals, good customs or public policy shall compensate the latter
for the damage.
10.2. The Revised Penal Code
Punishes the use of violence or threats by either ER or EE (Art. 289)
10.3. Special Laws
SSS law, GSIS law, Agrarian Reform Law, 13th month Pay Law, etc.

LABOR LAW AND SOCIAL LEGISLATION Article 3: DECLARATION OF BASIC POLICY

Social legislation includes laws that provide particular kinds of protection or benefits to
society or segments thereof in furtherance of social justice. In that sense, labor laws are
necessarily social legislation.
SOCIAL JUSTICE AS THE AIM
The aim, reason, and justification for labor laws is social justice.
Section 3 of Article XIII says that “the State shall afford full protection to labor, LOCal
and overseas, organized and unorganized, and promote full EMYPT and equality of EMYPT
opportunities for all.”
This is because “without the improvement of economic conditions, there can be no real
enhancement of the political rights of the people.”
6. BIRTH OF THE LABOR CODE
Writing began under Blas Ople, Father of the Labor Code
The objective was not merely to consolidate the then existing pieces of social legislation,
but also to reorient them to the needs of economic development and justice.
7. PRINCIPLES UNDERLYING THE CODE
Must be both responsive and responsible to national development
Must substitute rationality for confrontation in times of national emergencies
Must be made expeditious without sacrificing due process
Manpower development and EMYPT must be regarded as a major dimension of labor
policy
Availability of a global labor market to qualified Filipinos
2. INTERDEPENDENCE
It should not be deduced that the basic policy is to favor labor to prejudice
capital. The plain reality is that both sectors need each other. They are
interdependent- one is inutile without the other.
The better understanding is that the basic policy is to balance or coordinate the
rights and interests of both workers and the ERs.
Article 4: CONSTRUCTION IN FAOVR OF LABOR
COMMENTS AND CASES
1. INTERPRETATION AND CONSTRUCTION
1.1. Laborer’s Welfare; Liberal Approach
The working man’s welfare should be the primordial and paramount
consideration. The policy is to extend the Decree’s applicability to a greater
number of EEs to enable them to avail of the benefits under the law, in
consonance with the State’s avowed policy to give maximum aid and protection to
labor.
1.2. Concern for Lowly Worker
The Sc reaffirms its concern for the lowly worker who, often at his ER’s mercy,
must look up to the law for protection.
1.3. Reason for According Greater Protection to EEs
In the matter of EMYPT bargaining, there is no doubt that the ER stands on
higher footing than the EE.

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 This is because there is a greater supply than demand for labor. Also, the need
for EMYPT comes from vital, even desperate, necessity.
2. MANAGEMENT RIGHTS
1. Right to ROI
2. Rights to Prescribe Rules
3. Right to Select EEs
4. Right to Transfer or Discharge EEs
Article 6: APPLICABILITY
1. APPLICABILITY TO GOVERNMENT CORPORATIONS
The ruling now is that the Labor Code applies to a corporation incorporated
under the Corporation Code.
Government corporations created by special charter from Congress are subject
to civil service rules, while those incorporated under the Corporation Code are
covered by the Labor code.
GOCC with original charter refer to corporation chartered by special law form Congress as
distinguished from corporation organized under our general incorporation state, the
Corporation Code.
2. NON-APPLICABILITY TO GOVERNMENT AGENCIES
The terms governmental “agency” or “instrumentality” are synonymous in the
sense that either of them is a means by which a government acts, or by which a
certain government act or function is performed. The word “instrumentality” with
respect to the state, contemplates an authority to which the state delegates
government power for the performance of a state function.
Example: The National Parks Development Committee is an agency of
the government, not a government-owned or controlled corporation. Its
EEs are covered by civil service rules and regulations, since they are civil
service EEs.
But if function is proprietary in nature, its EEs are governed by the Labor Code.
3. APPLICABILITY WITHOUT ER-EE RELATIONSHIP
The Labor Code may apply even if the parties are not ERs and EEs of each
other.
The Labor Code applies with or without EMYPT relationships between the
disputants, depending on the kind of issue involved.
For example, when one speaks of EMYPT benefits, then surely, EMYPT
relationship is an essential element. But when the issue, for instance, is an indirect
ER’s liability, there is no ER-EE relationship and yet the pertinent Labor Code
provisions find application.
Title I
RECRUITMENT AND PLACEMENT OF WORKERS
Chapter I
GENERAL PROVISIONS
Article 13: DEFINITIONS
(a) "Worker" means any member of the labor force, whether employed or unemployed.
(b) "Recruitment and placement" refers to any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring or procuring workers, and includes referrals, contract services,
promising or advertising for EMYPT, Locally or abroad, whether for profit or not: Provided,
That any person or entity which, in any manner, offers or promises for a fee, EMYPT to two
or more persons shall be deemed engaged in recruitment and placement.
(c) "Private fee-charging EMYPT agency" means any person or entity engaged in
recruitment and placement of workers for a fee which is charged, directly or indirectly, from
the workers or ERs or both.
(d) "License" means a document issued by the Department of Labor authorizing a person or
entity to operate a private EMYPT agency.
(e) "Private recruitment entity" means any person or association engaged in the recruitment
and placement of workers, Locally or overseas, without charging, directly or indirectly, any
fee from the workers or ERs.
(f) "Authority" means a document issued by the Department of Labor authorizing a person
or association to engage in recruitment and placement activities as a private recruitment
entity.
(g) "Seaman" means any person employed in a vessel engaged in maritime navigation.
(h) "Overseas EMYPT" means EMYPT of a worker outside the Philippines.
(i) "Emigrant" means any person, worker or otherwise, who emigrates to a foreign country
by virtue of an immigrant visa or resident permit or its equivalent in the country of
destination.
Article 16: PRIVATE RECRUITMENT
COMMENTS
AUTHORIZED ENTITIES
Based on the Rules Implementing the Code, the following entities are
authorized to recruit and place workers for LOCal or overseas EMYPT:
a. public EMYPT offices
b. Private recruitment entities
c. Private EMYPT agencies
d. Shipping or manning agents or representatives
e. POEA
f. Construction contractors if authorized to operate by DOLE and the
Construction Industry Authority
g. Members of the diplomatic corps although hirings done by them have
to be processed through the POEA
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 h. Other persons or entities as may be authorized by the DOLE Secretary.
Article 17: OVERSEAS EMYPT DEVELOPMENT BOARD
4. THE POEA: OVERVIEW OF ITS FUNCTIONS AND POWERS
Among the principal functions of the POEA are the formulation, implementation,
and monitoring of the overseas EMYPT of the Filipino workers and the protection
of their rights to fair and equitable EMYPT practices.
5. Jurisdiction retained with POEA
 All cases which are administrative in character, involving or arising out of violations
of rules and regulations relating to licensing and registration of recruitment and
EMYPT agencies or entities; and
 Disciplinary action cases and other special cases which are administrative in
character, involving ERs, principals, contracting partners and Filipino migrant
workers.
Article 18: BAN ON DIRECT-HIRING
Name hires should register with the POEA by submitting the following documents:
a. EMYPT contract
b. Valid passport
c. EMYPT visa or work permit, or equivalent document
d. Certificate of medical fitness
e. Certificate of attendance to the required EMYPT orientation/ briefing
Article 19: OFFICE OF EMIGRANT AFFAIRS
COMMENTS
Direct hiring of Filipino workers by a foreign ER is not allowed except direct hiring by
members of he diplomatic corps and others mentioned in this article. Also excepted are
“name hirees” or those individual workers who are able to secure contracts for overseas
EMYPT on their own efforts and representations without the assistance or participation of
any agency.
The Office of Emigrant Affairs has been abolished and its pertinent functions were
transferred to the Commission on Filipinos Overseas (CFO) by Batasang Pambansa Blg.
79.
Article 20: NATIONAL SEAMEN BOARD
COMMENTS AND CASES
1. NSB NOW POEA
EO 797 abolished the NSB and transferred its function to the POEA. But this
adjudicatory function of the POEA has since been moved to the NLRC by RA 8042.
2. ARTICLE 20 CONSTRUED; SEAMEN’S EMYPT CONTRACTS AND THE
INTERNATIONAL TRANSPORT FEDERATION (ITF)
Wallem Shipping vs. Ministry of Labor: Seamen who were dismissed because
they demanded that they be paid the worldwide rate, instead of the lower Far East
rate as provided in their contracts of EMYPT, did not commit serious misconduct
as to warrant their dismissal. They were only exercising their rights. Hence,
dismissal was illegal.
“Filipino seamen are admittedly as competent and reliable as seamen from any
other country in the world; otherwise, there would not be so many of them in the
vessels sailing in every ocean and sea on this globe. They are entitled to
government protection when they ask for fair and decent treatment by their ERs
and when they exercise their right to petition for improved terms of EMYPT,
especially when they feel that these are substandard or are capable of
improvement according to internationally accepted rules. Also, the standard forms
embody the basic minimums which must be incorporated as parts of the EMYPT
contract. They are not collective bargaining agreements or immutable contracts
which the parties cannot improve upon or modify in the course of the agreed peril
of time.” (Vir-jen Shipping vs. NLRC)
3. INVALID SIDE AGREEMENT
An agreement that diminishes the EE’s say and benefits as contained in a
POEA approved contract is void, unless such subsequent agreement is approved
by the POEA.
4. PERIOD TO FILE OFW CLAIMS
should be filed within 1 year from the date of the seafarer’s return to the point of
hire.
Article 21: FOREIGN SERVICE ROLE AND PARTICIPATION
COMMENTS
1. PROTECTION AND ASSISTANCE BY GOVERNMENT AGENCIES
RA 8042 assigns four government agencies to promote the welfare and protect
the rights of migrant workers and, as far as practicable, of all overseas Filipinos:
DFA, DOLE, POEA, and OWWA.
2. THE OWWA
a national government agency, attached to the DOLE, that develops and
implements welfare programs and services to OFWs and their families.
3. REPATRIATION OF WORKERS
The primary responsibility to repatriate a worker, including his or her remains
and personal effects, belongs to the principal or the agency that recruited or
deployed the worker.
If the termination is due solely to the fault of the worker, the principal or agency
may recover the cost of repatriation from the worker after return to the country.
If the principal of agency does not comply with this obligation, the POEA shall
notify the OWWA to advance the repatriation cost with recourse to the agency or
principal.
Article 22: MANDATORY REMITTANCE OF FOREIGN EXCHANGE EARNINGS
REMMITTANCE
EO No. 857, prescribes the percentage of foreign exchanged remittance ranging
from 50% to 80% of the basic salary, depending on the worker’s kind of job.
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Article 23: COMPOSITION OF THE BOARDS d. Individuals, partners, officers or directors of an insurance company who make,
COMMENTS propose or provide an insurance contract under the compulsory insurance
1. COMPOSITION OF THE POEA coverage for agency-hired Overseas Filipino Workers.
The Governing Board is composed of e. Sole proprietorship[, partners or officers and members of the board with derogatory
a. Secretary of Labor and EMYPT – Chairman records, such as, but not limited to the following;
b. The Administrator – and such Deputy Administrator and Directors as 1. Convicted for illegal recruitment
may be necessary are appointed by the President upon 2. Agencies whose license been revoked for violation of RA No. 8042
recommendation of the Secretary. 3. License been cancelled
c. Third member considered well-versed in the field of overseas EMYPT f. Any official or EE of the DOLE, POEA, OWWA, DFA, DOJ, DOH, BI, IC, NLRC,
who shall be appointed by the President to serve for a term of 2 TESDA etc
years
Chapter II VALIDITY OF LICENSE
REGULATIONS OF RECRUITMENT AND PLACEMENT ACTIVITIES The license shall be valid for a period of 3 years from the date of issuance unless revoked
or cancelled. RENEWAL – must be filed not earlier then 60 days but not later than 30 days
The rules disqualify from engaging in the business of recruitment and placement for before its expiration.
domestic EMYPT the following:
a. Persons convicted of illegal recruitment, trafficking in persons, violation of child Liability Undertakings of Recruitment Agency excerpt
labor laws, or crimes involving moral turpitude  Assume joint and several liability with the ER for all claims and liabilities which may
b. Agencies whose license have previously been cancelled or revoked arise in connection with the implementation of the contract, including but not limited
c. Cooperative whether registered or not under the Cooperative Act of the Philippines to unpaid wages, death and disability compensation and repatriation
d. Law enforcers and any officials or EE of DOLE  assume full and complete responsibility for all acts of its officers, EEs and
Note: Agencies licensed to engaged in recruitment and placement for LOCal EMYPT are representatives done in connection with recruitment and placement
prohibited from engaging in job contracting or subcontracting activities.
Article 32: FEES TO BE PAID BY WORKERS
Article 27: CITIZENSHIP REQUIREMENT COMMENTS AND CASES
Only Filipino citizen or corporations, partnerships or entities at least 75% of the authorized 1. CHARGEABLE FEES
and voting capital stock of which is owned and controlled by Filipinos. An agency may charge the following
a. Service Fee
Article 28: CAPITALIZATION b. transportation expenses
COMMENTS
 Private EMYPT agency for LOCAL EMYPT Fees and costs chargeable to principals or ER
a. Single proprietorship and partnership – minimum net worth of 1 million a. visa, including the stamping fee
b. Corporation – minimum paid-up capital of 1 million b. work permit and residence permit
 Private recruitment or manning agency for OVERSEAS EMYPT c. round trip airfare
a. Single proprietorship and partnership – minimum capitalization of 5 million d. POEA processing fee
b. Corporation – minimum paid-up capital of 5 million e. OWWA membership fee
f. Transportation form airport to jobsite
Overseas EMYPT g. Additional trade test or assessment if required by the principal/ER
Entities disqualified from participating or engaging in the recruitment and placement of
workers for OVERSEAS EMYPT. Documentation costs to be shouldered by the OFW:
a. Travel agencies and sales agencies of airline companies 1. passport
b. Officers and members of the Board of any corporation or partnership engaged in 2. NBI/Police/Barangay Claearance
the business of travel agency 3. NSO authenticated birth certificate
c. Corporation and partnerships, where any of its officers, members of the board or 4. Transcript of records and diploma
partners is also an officer, member of the board or partner of a corporation or 5. Professional license from PRC
partnership engaged in the business of a travel agency 6. Certificate of Competency from TESDA or other competent body
7. DOH prescribed medical/health examination

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2. REFUND FEES
POEA has the power to order the refund of illegally collected fees. Art. 36 – Regulatory Power
The Secretary of Labor shall have the power to restrict and regulate the recruitment and
Article 33: REPORTS ON EMYPT STATUS placement activities of all agencies within the coverage of this Title and is hereby authorized
Article 34: PROHIBITED PRACTICES to issue orders and promulgate rules and regulations to carry out the objectives and
COMMENTS AND CASES implement the provision of this Title.
PROHBITED PRACTICES
Article 34(a) prohibits the charging or accepting of fees greater than that Art. 37 – Visitorial Power
allowed by regulations. It is also a deterrant to loan sharks who lend money at The Secretary of Labor or his duly authorized representatives may, at any time, inspect the
usurious interests. premises, books of accounts and records of any person or entity covered by this Title,
Article 34(b) includes the act of furnishing fake EMYPT documents to a worker, require it to submit reports regularly on prescribed forms, and act on any violations of this
and the act of publishing false notice or information in relation to recruitment or Title.
EMYPT.
In Article 34(d), it is not necessary that the worker was actually induced or did Art. 38 – ILLEGAL RECRUITMENT
quit the EMYPT.
1. Illegal Recruitment- 2 Kinds
Article 35: SUSPENSION AND/OR CANCELLATION OF LICENSE OR AUTHORITY a. Illegal Recruitment by a non-licensee
COMMENTS AND CASES b. Other illegal Recruitment Acts by either a non-licensee or a licensee
1. SUSPENSION OR CANCELLATION OF LICENSE Relating to local EMYPT
The grounds for imposition of administrative sanctions include engaging in acts 1. Overcharging – to charge or accept directly or indirectly any amount or to
of misrepresentation for the purpose of securing a license or renewal thereof, etc. make a worker pay the agency or its representatives any amount greater than
The acts prohibited under Art. 34 are not just grounds for suspension or that actually loaned pr advanced to him.
cancellation of license or authority. They likewise constitute illegal recruitment 2. False notice – to furnish or publish any false notice or information in relation to
under RA 8042. recruitment or EMYPT
1.1 Concurrent Jurisdiction to Suspend or Cancel a License 3. Misrepresentation to secure a license – to give any false notice,
The SC has affirmed the concurrent jurisdiction of the DOLE Secretary and the misrepresentation for the purpose of securing a license or authority
POEA Administrator to suspend or cancel a license. 4. Inducing worker to quit – to induce or attempt to induce a worker already
employed to quit his EMYPT in order to offer him another
2. PERSONS LIABLE; DURATION OF LIABILITY 5. Inducement not to employ – to influence or attempt to influence any person or
A recruitment agency is solidarily liable for the unpaid salaries of a worker it entity not to employ any worker who has not applied for EMYPT through his
recruited for EMYPT with a foreign principal. agency.
Even if the recruitment agency and the principal had already severed their 6. Recruitment for harmful jobs -
agency agreement at the time the worker was injured the recruitment agency may 7. Obstructing Inspection
still be sued for violation of the EMYPT contract, if no notice of the agency 8. Contract substitution –
agreement’s termination was given to the EE.
The responsibilities of the recruitment agency and the principal to the worker Relating to Overseas EMYPT
extends up to and until the expiration of the EMYPT contracts of the EEs recruited 9. Misrepresentation in documentation
and employed pursuant to the said EMYPT agreement. 10. Non- submission of reports
11. Involvement of Travel agency
3. SOLIDARY LIABILITY ASSUMED BY RECRUITMENT AGENT 12. Withholding documents
Contract contained a provision empowering the agency to sue and be sued 13. Failure to deploy
jointly and solidarily with the foreign principal for any of the violations of the recruitment 14. Failure to reimburse
agreement and the contracts of EMYPT. These contractual undertakings constitute the 15. Non-Filipino manager
legal basis for private agencies being liable jointly and severally with its principal, for all 16. Excessive interest
claims filed by recruited workers which may arise in connection with the implementation 17. Specifying a loan entity
of the service agreements or EMYPT contracts. (Royal Crown Inernationale vs. NLRC) 18. Non-renegotiation of loan
19. Specifying medical entity
Chapter III – Miscellaneous Provisions 20. Specifying training entity
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 21. Violation of suspension
22. Collection of Insurance premium
2. Illegal recruitment as Economic Sabotage
a. Illegal recruitment is committed by a syndicate – if carried out by a group of 3
or more persons conspiring and/or confederating with one another; or
b. Illegal recruitment is committed in large scale – if it is committed against 3 or
more persons individually or as a group.
Note: where illegal recruitment is proved, but the elements of large scale or
syndicate are absent, the accused can be convicted only of simple illegal
recruitment.
ESTAFA: CONVICTION for Illegal Recruitment is not a bar for filing suit against such
person for ESTAFA under the RPC as long as the requisites for said felony are present
THE POWER TO ISSUE SEARCH AND ARREST WARRANTS AS FOUND IN ART. 38 (C)
DEEMED UNCONSTITUTIONAL see Salazar v. Achacoso and Marquez, G.R. No. 81510,
March 14, 1990
 under the Constitution (Art. III, Sec. 2, 1987 Constitution) only a judge
may issue a warrant of arrest or a search warrant
 the Secretary of Labor is not a judge hence is no longer granted the
power to issues said warrants. Authorities must now undergo judicial
process
Exception: Deportation or Illegal and Undesirable Aliens Cases—the President or the
Commissioner of Immigration may order arrested following a final order of deportation for
the purpose of deportation
SUBJECT TO ARREST: Illegal Recruiters are still subject to arrest, upon compliance
with the procedure as provided for by law namely through a warrant of arrest issued by a
judge of an RTC where a criminal information was filed after preliminary investigation; also
RULES ON WARRANTLESS ARRESTS under Rule 113, Section 5 of the ROC may still
apply to illegal recruiters when they fall under the circumstances enumerated therein;
WARRANTLESS SEARCHES: INCIDENTAL to lawful arrest; PLAIN VIEW; with
INDIVIDUAL’S CONSENT
CLOSURE ORDER: DOLE Secretary or his duly authorized representative still has
power or authority to issue and order closure of illegal recruitment establishes, this being an
ADMINISTRATIVE and REGULATORY action; Issuance after an ex parte preliminary
examination to determine whether the activities of a non-licensee constitute a danger to
national security and public order or will lead to further exploitation of job seekers
PROCEDURE FOR CLOSURE: Rules Secs. 14 – 27; these cover the POEA’s Anti-
Illegal Recruitment Programs; Provision for Legal Assistance; Complaints Desk;
Surveillance; Issuance of Closure Order; Implementation of Closure Order; Report on CO,
Institution of Criminal Action; Motion to Lift CO; Who may file such Motion; Grounds for
Lifting or Re-opening; Appeal and Re-padLOCking of Office
Art. 39 - PENALTIES3
A. The penalty of life imprisonment and a fine of One Hundred Thousand Pesos
(P100,000) shall be imposed if illegal recruitment constitutes economic sabotage
as defined herein;
B. Any licensee or holder of authority found violating or causing another to violate any
provision of this Title or its implementing rules and regulations shall upon
conviction thereof, suffer the penalty of imprisonment of not less than two years
nor more than five years or a fine not less than P10,000 nor more than P50,000, or
both such imprisonment and fine, at the discretion of the court;
C. Any person who is neither a licensee nor a holder of authority under this Title found
violating any provision thereof or its IRR’S shall, upon conviction thereof, suffer the
penalty of imprisonment of not less than four years nor more than eight years or a
fine not less than P20,000 nor more than P100,000 or both such imprisonment and
fine, at the discretion of the court;
D. If the offender is a corporation, partnership, association, or entity, the penalty shall
be imposed upon the officer or officers of the corporation, partnership, association,
or entity responsible for the violation, and if such officer is an alien, he shall, in
addition to the penalties herein prescribed, be deported without further
proceedings;
E. In every case, conviction shall cause and carry the automatic revocation of the
license or authority and all the permits and privileges granted to such person or
entity under this Title, and the forfeiture of the cash and surety bonds in favor of
the Overseas EMYPT Board or the National Seamen Board, as the case may be,
both of which are authorized to use the same exclusively to promote their
objectives.
Section 7, RA 8042 provides:
Any person found guilty of IR shall suffer the penalty of IMPRISONMENT of NOT LESS
THAN SIX (6) YEARS AND ONE (1) DAY BUT NOT MORE THA TWELVE (12) YEARS and
A FINE OF NOT LESS THAN TWO HUNDRED THOUSAND PESOS (P200,000.00) NOR
MORE THAN FIVE HUNDRED THOUSAND PESOS (P500,000.00)
The penalty of LIFE IMPRISONMENT and a FINE NOT LESS THAN FIVE HUNDRED
THOUSAND PESOS (P500,000.00) NOR MORE THAN ONE MILLION PESOS
(P1,000,000.00) shall be imposed if IR CONSTITUTES ECONOMIC SABOTAGE
Provided however, That the MAXIMUM PENALTY shall be imposed if the PERSON
ILLEGALLY RECRUITED is LESS THAN 18 YEARS OF AGE or committed by a non-
licensee or non-holder of authority.
VENUE (Sec. 9, RA 8042): Criminal Action arising from IR shall be filed with the REGIONAL
TRIAL COURT of the province or city WHERE THE OFFENDED PARTY ACTUALLY
RESIDES AT THE TIME OF THE COMMISSION OF THE OFFENSE
MANDATORY PERIODS for Resolution of IR cases (Sec. 11, RA 8042): terminate within 30
days from date of filing: preliminary investigation; file information within 24 hours from
termination of investigation; file information within 48 hours from the date of receipt of case
records if preliminary investigation conducted by judge and prima facie case is established
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PRESCRIPTIVE PERIODS (Sec. 12, RA 8042): General IR: five (5) years; IR involving
Economic Sabotage: twenty (20) years
TITLE II – EMYPT OF NON-RESIDENT ALIENS
Art. 40 – EMYPT PERMIT OF NON-RESIDENT ALIENS
Any alien seeking admission to the Philippines for EMYPT purposes and any domestic or
foreign ER who desires to engage an alien for EMYPT in the Philippines shall obtain an
EMYPT permit from the DOLE.
The EMYPT permit may be issued to a non-resident alien or to the applicant ER after a
determination of non-availability of a person in the Philippines who is competent, able and
willing at the time of the application to perform the services for which the alien is desired.
For an enterprise registered in preferred areas of investments, said EMYPT permit may be
issued upon recommendation of the government agency charged with the supervision of
said registered enterprise.
Art. 41 – Prohibition against transfer of EMYPT
a. After the issuance of the EMYPT permit, the alien shall not transfer to another job
or change his ER without prior approval from the Secretary of DOLE
b. Any non-resident alien who shall take up EMYPT in violation of provision of this
Title and its IRR’s shall be punished in accordance with Arts. 2894 and 290 of the
Labor Code.
In addition, the alien worker shall be subject to deportation after service of his sentence.
RESIDENT ALIENS: NOT required to have EMYPT permits; instead, they need an ALIEN
EMPLOYMENY REGISTRATION CARD (AERC)
NATIONALIZED INDUSTRIES and the ANTI-DUMMY LAW (C.A. no. 108 as amended by
PD715) – Foreigners may not be employed in certain “nationalized” industries; law provides
and subjects reservation of ownership and control of such corporations to the 60%
requirement, i.e. public utility, natural resources; financing companies; however, media and
advertising requires 100% Filipino ownership and management (Consti)
DEPARTMENT ORDER no. 12, SERIES 2001: Omnibus Guidelines for the Issuance of
EMYPT Permits to Foreign Nationals; the following are required to apply for an Alien
EMYPT Permit (AEP):
1. All foreign nationals seeking admission to the Philippines for the purpose of
EMYPT;
2. Missionaries or religious workers who intend to engage in gainful EMYPT;
3. Holders of Special Investors Resident Visa (SIRV), Special Retirees Resident Visa
(SRRV), Treaty Trades Visa, or Special Non-Immigration Visa, who occupy any
advisory, supervisory, or technical position in any establishment;
4. Agencies, organizations, or individuals whether public or private, who secure the
services of foreign professional to practice their professions in the Philippines
under reciprocity and international agreements;
5. Non-Indo Chinese Refugees who are asylum seekers and given refugee status by
the UN High Commissioner on Refugees (UNHCR) of the DOJ under the DOJ
Department Order no. 49, 1998.
6. Resident foreign Nationals seeking EMYPT in the Philippines (see D.O. no. 21-02
which suspends “until further notice” the requirement for Resident Foreign
Nationals to secure AEP)
D.O. 12-01 further, EXEMPTS the following from AEP requirements:
1. All members of the diplomatic services and foreign government officials accredited
by the Philippine Government;
2. Officers and staff of the international organizations of which the Philippine
government is a cooperating member, and their legitimate spouses desiring to
work in the Philippines;
3. Foreign nationals elected as members of the Governing Board who do not occupy
any other position, but have only voting rights in the corporation, and
4. All foreign nationals granted exemption by special laws and all other laws that may
be promulgated by Congress
Basis for issuing AEP:
a. Compliance by the applicant ER or the foreign national with the substantive and
documentary requirements;
b. Determination of the DOLE Secretary that there is no Filipino national who is
competent, able and willing to do the job for which the services of the applicant is
desired;
c. Assessment of the DOLE Secretary that the EMYPT of the foreign national will
redound to national benefit.
Understudy Program is no longer required for the issuance of AEP
G.R. Validity of AEP is for ONE YEAR unless the EMYPT contract, consultancy services, or
other modes of engagement or term of office for elective officers, provides for a longer
period;
RENEWAL OF AEP: application must be filed at least 15 days before its expiration;
EFFECTIVITY OF RENEWAL: one day after the expiration of previous permit; regardless of
whether or not the renewal is granted before or after the expiration of the previous permit;
GENERAL RULE: PERMITS VALID ONLY FOR THE POSITION AND ER FOR WHICH
THEY WERE ISSUED; except in cases of holders of MULTIPLE POSITIONS IN ONE
CORPORATION
BOOK TWO
HUMAN RESOURCES DEVELOPMENT
TITLE II – TRAINING AND EMYPT OF SPECIAL WORKERS
Chapter 1: APPRENTICES
Art. 57 – Statement of Objectives
Art. 58 – Definition of Terms
Page 7 of 32
As used in this Title:
a. Apprenticeship – means any practical training on the job supplemented by related
theoretical instruction;
b. An Apprentice is a worker who is covered by a written apprenticeship agreement
with an individual ER or any entities recognized under this Chapter;
c. An Apprenticeable Occupation means any trade, form of EMYPT or occupation
which requires more than three (3) months of practical training on the job
supplemented by related theoretical instruction; (see R.A. 7796)
d. Apprenticeship Agreement is an EMYPT contract wherein the ER binds himself to
train the apprentice and the apprentice in turn accepts the terms of training.
Art. 59 – Qualifications of an Apprentice
To qualify as an apprentice, a person shall:
(a) Be at least fourteen (14) years of age; (but under the IRR, it’s 15 years)
(b) Possess vocational aptitude and capacity for appropriate tests; and
(c) Possess the ability to comprehend and follow oral and written instructions.
Trade and industry associations may recommend to the Secretary of Labor appropriate
educational requirements for different occupations.
Art. 60 – EMYPT of Apprentices
Apprenticeship is the arrangement and the period when an upcoming worker undergoes
hands-on training, more or less formal, to learn the ropes of a skilled job. It is usually the
point of entry to the world of work.
Requisites for EMYPT of apprentices
a. The ER should be engaged in a business that is considered a highly technical
industry. A highly technical industry is a trade, business, enterprise, industry or
other activity which utilizes the application of advanced technology.
b. The job which the apprentice will work on should be an apprenticeable occupation.
Art. 61 – Contents of Apprenticeship Agreements
Apprenticeship need DOLE’s prior approval, or Apprentice becomes regular EE
Nitto Enterprises v. NLRC and R. Capili (G.R. no. 114337) September 29, 1995
It is mandated that apprenticeship agreements entered into by an ER and
an apprentice shall be entered only in accordance with the apprenticeship program
duly approved by the Minister of Labor and EMYPT; hence, since the
apprenticeship agreement between petitioner and private respondent has no force
and effect in the absence of a valid apprenticeship program duly approved by the
DOLE, private respondent’s assertion that he was hired not as an apprentice but
as a delivery boy deserves credence.
Art. 72 - Apprentices without Compensation
Implementing Rules (Section X, Rule 14) provide, in relation to Art. 72: There is no ER-
EE relationship between students on one hand and schools, colleges or universities, on the
other, where there is a written agreement between them under which the former agree to
work for the latter in exchange for the privilege to study free of charge, provided the
students are given real opportunities, including such facilities as may be reasonable and
necessary to finish their chosen courses under such agreement.
Filamer Christian Institue v. Hon. Intermediate Appellate Court, et a, (G.R. no. 75112)
August 17, 1992
Section 14, Rule X, Book III of the IRR of the Labor Code was
promulgated by the Secretary of Labor and EMYPT only for the purpose of
administering and enforcing the provisions of the Labor Code on conditions of
EMYPT. Particularly, Rule X of Book III provides guidelines on the matter by which
the powers of the Labor Secretary shall be exercised; on what records should be
kept or maintained, etc… Rule X is merely a guide to the enforcement of the
substantive law on labor. The case does not deal with a labor dispute on conditions
of EMYPT between an alleged ER and EE… reliance of petitioner on the IRR is
misplaced. An IRR on labor cannot be used by an ER as a shield to avoid liability
under the substantive provisions of the Civil Code.
Chapter II – LEARNERS
Art. 73 – Definition
Learners are persons hired as trainees in semi-skilled and other industrial occupations
which are non-apprenticeable and which may be learned through practical training on the
job in a relatively short period of time which shall not exceed three (3) months.
Art. 74 – When Learners may be hired
Learners may be hired when:
a. no experienced workers are available,
b. the EMYPT of learners is necessary to prevent curtailment of opportunities; and
c. the EMYPT does not create unfair competition in terms of labor costs or impair or
lower working standards.
Art. 75 – Learnership Agreement
Any ER desiring to employ learners shall enter into a learnership agreement with them,
which agreement shall include:
a. the names and addresses of the learners;
b. the duration of the learnership period, which shall not exceed three (3) months;
c. the wages or salary rates of the learners which shall begin at not less than
seventy-five (75%) percent of the applicable legal minimum wage; and
d. a commitment to employ the learners if they so desire, as regular EEs upon
completion of the learnership. All learners who have been allowed or suffered to
work during the first two (2) months shall be deemed regular EEs if training is
terminated by the ER before the end of the stipulated period through no fault of the
learner.
The learnership agreement shall be subject to inspection by the Secretary of Labor, or his
duly authorized representatives.
Art. 76 – Learners in Piecework
Learners employed in piecework or incentive-rate jobs during the training period shall be
paid in full for the work done.
Page 8 of 32
 The EMYPT agreement shall be subject to inspection by the Secretary of Labor or his duly
Art. 77 – Penalty Clause authorized representatives.
Any violation of this Chapter or its IRR’s shall be subject to the general penalty clause
provided for in this Code. Art. 81 – Eligibility for Apprenticeship
Subject to the appropriate provisions of this Code, handicapped workers may be hired as
Learnership v. Apprenticeship: apprentices or learners if their handicap is not such as to effectively impede the
BOTH: Training periods for jobs requiring skills that can be acquired through actual work performance of job operations in the particular occupations for which they are hired.
experience; both learner and apprentice may be paid wages twenty-five (25%) percent The MAGNA CART FOR DISABLED PERSONS- Republic Act no. 7277, March 24,
lower than the applicable legal minimum wage 1992 – insures equal opportunities for disabled persons and prohibits discrimination against
Learnership them
Apprenticeship
 training in semi-skilled job; industrial occupations that require training for less than Explain “Equal Opportunity for EMYPT.”
3 months No disabled person shall be denied access to opportunities for suitable EMYPT. A
 job is non-apprenticeable because its practical skills can be learned in 3 (not 6) qualified disabled person shall be subject to the same terms and conditions of EMYPT and
months the same compensation, privileges, benefits, fringe benefits, incentives or allowances as a
 commitment to hire a learner after the period qualified able-bodied person.
 no need for prior approval from DOLE in terms of hiring
 training in highly-skilled job; job found in highly-technical industry; training period Qualified Individual with a Disability
exceeds 3 months An individual with a disability who, with or without reasonable accommodation, can
 minimum period is 6 months perform the essential functions of the EMYPT position that such individual holds or desires.
 no commitment to hire an apprentice even after completion of period However, consideration shall be given to the ER’s judgment as to what functions of a job
are essential, and if an ER has prepared a written description before advertising or
 prior DOLE approval required for hiring apprentices
interviewing applications for the job.
Learner is not an apprentice, but an apprentice is considered a learner.
Sheltered EMYPT
Refers to the provision of productive work for disabled persons through workshops
Chapter III – HANDICAPPED WORKERS
providing special facilities, income-producing projects or homework schemes with a view to
giving them the opportunity to earn a living thus enabling them to acquire a working capacity
Art. 78 – Definition
required in open industry.
Handicapped workers are those whose earning capacity is impaired by age, or physical or
mental deficiency or injury.
Discrimination on EMYPT
Give at least 5 acts of discrimination
Art. 79 – When Employable
1. Limiting, segregating or classifying a disabled job applicant in such a manner that
Handicapped workers may be employed when:
adversely affects his work opportunities.
a. their EMYPT is necessary to prevent curtailment of EMYPT opportunities; and
2. Providing less compensation, such as salary, wage or other forms of
b. it does not create unfair competition in labor costs or impair or lower working
remuneration and fringe benefits, to a qualified disabled EE, by reason of his
standards.
disability, than the amount to which a non-disabled person performing the same
work is entitled.
Art. 80 – EMYPT Agreement
3. Re-assessing or transferring a disabled EE to a job or position he cannot perform
Any ER who employs handicapped workers shall enter into an EMYPT agreement with
by reason of his disability
them, which agreement shall include:
4. Favoring non-disabled EE over a qualified disabled EE with respect to promotion,
a. the names and addresses of the handicapped workers to be employed;
training opportunities, study and scholarship grants, solely on account of the
b. the rate to be paid the handicapped workers to be employed which shall be not
latter’s disability.
less than seventy-five (75%) percent of the applicable legal minimum wage;
5. Excluding disabled persons from membership in labor unions or similar
c. the duration of the EMYPT period; and
organizations.
d. the work to be performed by the handicapped workers.
Book 3
Conditions of EMYPT
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Title I Working Conditions and Rest Periods
Chapter 1
HOURS OF WORK
Art. 82 – Coverage of Title 1
EEs in all establishments and undertakings whether for profit or not BUT NOT TO
1. Government EEs
2. managerial EEs [those whose primary duty consists of the management of the
establishment in which they are employed or of a dept or subdivision thereof, and
to other officers or members of the managerial staff],
3. field personnel [refer to non-agricultural EEs who regularly perform their duties
away from the principal place of business or branch office of the ER and whose
actual hours of work in the field cannot be determined with reasonable certainty],
4. members of the family who are dependent on him for support,
5. domestic helpers,
6. persons in the personal service of another,
7. workers who are paid by results
The triple personality of a business enterprise or constitutive elements of EMYPT
1. Economic - the relationship between ER and EE is economic in character and
purpose because it involves creation or provision of goods and services that meet
material needs of people.
Case: Insular Hotel EEs Union-NFL vs. Waterfront
The Court rendered valid the collective bargaining negotiation undertaken in the
light of the financial condition of the ER, with the peculiar and unique intention of
not merely promoting industrial peace but also preventing the ER’s closure.
2. Governmental/ legal- the EMYPT relationship is affected and effected by law.
Case: Samahan ng Manggagawa sa Hanjin Shipyard, etc vs. BLR
Workers have the right to organize themselves for mutual aid or promotion. They
do not have to be EEs of any particular ER, and their organization does not have to
be a formal labor union. A worker’s association is not a union but by law it is
registerable as a legitimate labor organization, thus becoming a legal person.
3. Social – workers have personal needs that go beyond the economic. But while the
worker-hiree is always a natural person, the hirer, often an organized entity is an
artificial being without human needs and feelings.
Case: Social Security System vs. Debbie Ubana
The Court ruled in favor of the terminated EE who filed a civil case before the RTC
instead of the NLRC claiming for damages based on the alleged exploitation by
SSS depriving her of her rightful income. The basis of the ruling was rooted on the
principle of abuse of rights laid in the NCC.
Not every dispute between an ER and EE involves matters that only LA and the
NLRC can resolved in the exercise of their adjudicatory or quasi-judicial powers
especially when the principal relief sought is to resolved not by the CBA but the
general civil law.
ER-EE must exist; existence is determined by law, not by contract Elements of EMYPT
relationship (4-fold test)
1. selection and engagement of the EE
2. payment of wages
3. power of dismissal
4. ER’s power to control the EE with respect to the means and methods by which the
work is to be accomplished.
control test evidence of EMYPT: id, vouchers, SSS registration,
memorandum, appointment letters, payrolls, organization charts pakiao workers
are considered EEs as long as the ER exercises control over the means by which
such workers are to perform their work (Zamudio vs NLRC) mere fact that an entity
is a labor union does not mean that it cannot be considered an ER of the persons
who work for it; even unregistered association may be deemed an ER LC defines
an ER as any person who acts in the interest of an ER in/directly; the law does not
require an ER to be registered in order to be considered as an ER (Orlando Farm
Growers vs NLRC)
No EMYPT relationship job contracting or independent contractor ER is
free to regulate, accdg to his own discretion and judgment, all aspects of EMYPT,
including hiring, work assignments, working methods, time, place and manner of
work, tools to be used, processes to be followed, supervision of workers, dismissal
and recall of workers so long as the they are exercised in good faith for the
advancement of the ER’s interest and not for the purpose of defeating or
circumventing the rights of the EEs under special laws or under valid agreements
Excluded EEs
1. govt EEs governed by CSC rules EXCEPT govt EEs of govt agencies and govt
corporations incorporated under the Corporation Code
2. managerial EEs or staff
3. outside or field sales personnel
4. ER’s family members
5. domestic helpers
6. persons rendering personal service
7. workers paid by result
Two-tiered Approach: the Economic Dependence Test
Case: Angelina Francisco vs. NLRC
When the corporation stopped paying for her salary, the worker complained of constructive
dismissal. The corporation countered that she was never an employee because she was not
“controlled” in the performance of her work. The Court ruled that in certain cases, the control
test is not sufficient and that the better approach is to adopt the two-tiered test involving:
1. the putative ER’s power to control the EE with respect to the means and method
by which the work is to be accomplished;
2. the underlying economic realities of the activity or relationship.
The proper standard of economic dependence is whether the worker is dependent on the
alleged ER for his continued employment in that line of business.
Existence of Employment Relationship Determined by law not by contract the case of
Paguio vs NLRC (account executive receiving a commission and allowances and the
contract says that You are not an EE of The Manila Times)
Employment Relationship:
Page 10 of 32

Salaried Insurance Agent
An insurance company may have two classes of agents who sell its insurance policies 1)
salaried EE’s who keep definite hours and work under the control and supervision of the
company, 2) registered representatives who work on commission basis. One salient point in
the determination of ER-EE relationship which cannot be easily ignored is the fact that the
compensation that these agents on commission received is not paid by the insurance
company but by the investor.
School Teachers
The principal consideration in determining whether a workman is an EE or an independent
contractor is the right to control the manner of doing the work, and it is not the actual
exercise of the right by interfering with the work, but the right to control, which constitutes
the test.
Jeepney Driver, Taxi Driver, Barber
ER-EE relationship exists between the owner of the jeepneys and the drivers even if the
latter work under the boundary system. In the lease of chattels, the lessor loses complete
control over the chattel but in the case of jeepney owners/operators and jeepney drivers, the
former exercises supervision and control over the latter. The management of the business is
in the owner’s hand.
Boundary-hulog
The juridical relationship of EE-ER was not negated by the KASUNDUAN, considering that
petitioner retained control of the respondent’s conduct as driver of the vehicle.
Street hired cargadores
Workers in Movie Project
Assuming that the associate producers are job contractors, they must then be engaged in
the business of making motion pictures. They must have tools, equipment, machinery, work
premises, and other materials necessary to make motion pictures. However, the associate
producers here have none of these.
Labor Union as unregistered association as ER
The Labor Code defines an ER as any person who acts in the interest of an ER directly or
indirectly. The law does not require an ER to be registered in order to be considered as an
ER. Otherwise, it would bring about a situation where EE’s are denied not only redress of
their grievances but also the protection and benefits accorded them by law if their ER
happens to be simply an Unregistered Association.
Art. 83 – Normal Hours of Work
8-hour law prescribes the minimum
Art. 84 – Hours worked
 Prelim and postlim activities are deemed performed during working hours, where
such activities are controlled or required by the ER and are pursued necessarily
and primarily for the ER’s benefit
 Whether waiting time constitutes working time depends on the circumstances of
each case whether it is spent predominantly for the ER’s benefit or for the
emmployee’s; considered as working time if waiting is an integral part of his work
or if the EE is required or engaged by an ER to wait
 Working while eating not compensable if completely freed from duites even
though he remains in the workplace
 Working while sleeping may be considered working if it is subject to
interruption or takes place under conditions substantially less desirable than would
likely to exist at EE’s home
 “on call” compensable; “within reach through cellphone or other contact
device” not compensable
 Travel from home to work not worktime EXCEPT when EE receives an
emergency call outside of his regular working hours and is required to travel to his
regular place of business or some other work site, all of the time spent in such
travel is working time
 travel away from home travel that keeps an EE away from home overnight;
worktime
 attendance at lectures, meetings, training programs and other similar activities not
considered worktime if it is outside EE’s regular working hours, it is voluntary, and
the EE does not perform productive work during such attendance
 time spent in grievence meetings considered worktime
 regular full-time teachers are entitled to salary and emergency cost-of-living
allowance during semestral breaks (UPang Faculty Union vs UPANG)
 a laborer need not leave the premises of the workplace in order that his rest period
shall not be counted; it is enough that he ceases to work (case in point: seamen)
hours worked: ER has burden of proof
Art. 85 – Meal Periods
GR: not compensable
Exception: predominantly spent for ER’s benefit or where it is less than 60 minutes (but in
no case shall it be shorter than 20 minutes)
The situation where the meal break may be shortened to less than 60 min with full pay
a. work in non-manual, does not involve serious physical exertion
b. establishment regularly operates not less than 16 hrs a day
c. there is actual or impending emergencies to avoid serious loss which the ER would
otherwise suffer
d. work is necessary to prevent serious loss of perishable goods
Continuous shifts
E to E: shortened break is upon EE’s request
Requisites:
1. agree in writing to a shortened meal break and waive overtime pay for such
shortened period
2. no diminution in the salary and other fringe benefits
Page 11 of 32
 3. work does not involve strenuous physical exertion and are provided w/ coffee 6. effectivity of proposed working time arrangement shall be of temporary duration as
breaks determined by DOLE
4. value of the benefits derived by the EEs from the proposed work arrangement is
equal to or commensurate with the compensation due them Flexible Work Arrangements
5. overtime pay of the EEs will become due and demandable if ever they are Refer to an alternative arrangements or schedules other than the traditional or standard
permitted or made to work beyond 4:30pm work hours, workdays or workweek. ER’s may adopt them with consultation of EE. Must be
6. effectivity of proposed working time arrangement shall be of temporary duration as temporary only. This includes;
determined by DOLE 1. reduction of workday
2. rotation of workers
Art. 86 – Night Shift Differential 3. forced leave
not less than 10% of regular wage for each hour of work performed b/w 10pm to 6am 4. broken-time schedule
NSD not waivable since it is founded on public policy 5. flexi-holiday schedule
Burden of proof of payment rests upon the ER
Art. 88 – Undertime not offset by Overtime
Art. 87 – Overtime Work Art. 89 – Emergency Overtime Work
 Compensation for work rendered in excess of 8 hours a day 1. country is at war or when any national or LOCal emergency has been declared by
 Multiply the overtime hourly rate by the number of hours worked in excess of 8 Congress or the President
 Receipt of overtime pay does not preclude right to NSD 2. necessary to prevent loss of life or property or in case of imminent danger to public
 Overtime rate based on regular wage (excludes money received in different safety due to impending emergency caused by accidents, fire, flood, typhoon,
concepts and other fringe benefits) earthquake, epidemic, or other disaster or calamity
 How “work day” is counted 24-hour period which commences from the time the 3. urgent work to be performed on the machines, ect. In order to avoid loss or
EE regularly starts to work damage to ER
 Work in excess of 8 hours w/n a work day is considered as overtime regardless of 4. to prevent loss or damage to perishable goods
whether this is performed in a work shift other than at which EE regularly works 5. to prevent serious obstruction ot prejudice to the business or operations of the ER
 Estoppel and laches cannot be invoked against EEs in an action for the recovery of 6. to avail of favorable weather or environmental conditions where performance or
compensation for overtime work quality of work is dependent thereon
 Overtime pay in arrears retroacts to the date when services were actually rendere
Art. 90 – Computation of Additional Compensation
 GR: NO waiver or quitclaim of overtime pay
regular wage shall include cash wage only, w/o deduction on account of facilities
E: waiver is in exchange for certain benefits
provided by ER
Agreement that overtime pay will be integrated in basic salary is not per se illegal; however,
Chapter II
there should have been express agreement to that effect and that the mathematical result
WEEKLY REST PERIODS
shows that the agreed legal wage rate and the overtime pay, computed separately, are
Art. 91 – Right to weekly rest day
equal to or higher than the separate amounts legally due
☼ rest period of not less than 24 hours after every 6 consecutive normal work days
Compressed workweek (45 hours in 5 days) as an exception to the non-waiver of
Art. 92 – When ER may require work on a rest day
overtime pay if the following requisites are present:
1. necessary to prevent loss of life or property or in case of imminent danger to public safety
1. agree in writing to work 9 hours a day from Monday to Friday
due to impending emergency caused by accidents, fire, flood, typhoon, earthquake,
2. no diminution in the salary and other fringe benefits
epidemic, or other disaster or calamity
3. value of the benefits that will accrue to the EEs under the proposed work schedule
2. urgent work to be performed on the machines, ect. In order to avoid loss or damage to
is more than or at least commensurate with or equal to the one-hour overtime pay
ER
that is due them during weekdays
3. abnormal pressure of work due to special circumstances, where the ER cannot ordinarily
4. overtime pay of the EEs will become due and demandable if ever they are
be expected to resort to other measures
permitted or made to work on weekend
4. prevent loss or damage to perishable goods
5. work does not involve strenuous physical exertion and are provided w/ coffee
5. nature of work requires continuous operations and stoppage of work may result in
breaks
irreparable injury or loss to the ER
6. similar circumstances as determined by DOLE Sec.
Page 12 of 32
Art. 93 – Compensation for rest day, Sunday, or holiday work
☼ at least 30% of regular wage  double holiday: 2 regular holidays on same day
☼ when such holiday falls on his rest day, add’l compensation of at least 50% a. if unworked covered EEs are entitled to at least 200% of their basic wage
☼ CBA may stipulate higher premium pay even if said holiday is unworked
☼ 3 special days 30% b. if worked entitled to compensation equivalent to at least 300% of his basic
Ninoy Aquino Day Monday nearest August 21 wage
All Saints Day November 1
Last Day of the Year December 31  double holiday rule for monthly-paid EEs if worked, additional 100% of regular
salary
 successive regular holidays an EE may not be paid for both holidays if he
Chapter III absents himself from work on the day immediately preceding the 1st holiday,
HOLIDAYS, SERVICE INCENTIVE LEAVES, AND SERVICE CHARGES unless he works on the 1st holiday, in which case, he is entitled to his holiday pay
Art. 94 – Right to (Regular) Holiday on the 2nd holiday
100% Additional compensation  holiday pay of hourly-paid faculty members during semestral break
12 regular holidays ER-school is exempted from paying hourly paid faculty members their pay for
1. New Year (Jan.1) regular holidays, whether the same be during the regular semester or during semestral,
2. Maundy Thursday Christmas, or Holy Week vacations
3. Good Friday ER-school must pay said faculty members their regular hourly rate on days declared
4. Araw ng Kagitingan (Monday nearest Apr 9) as special holidays or for some reason classes are called off or shortened for the hours they
5. Labor Day (Monday nearest May 1) are supposed to have taught, whether extension of class days be ordered or not; in case of
6. Independence Day (Monday Jun 12) extensions said faculty mems shall likewise be paid their hourly rates should they teach
7. National Heroes Day (Last Monday of Aug) during said extension (JRC vs NLRC)
8. Eid ul-Fitr (Movable Date)
9. Eid ul-Adha (Movable Date)  field personnel not entitled to holiday pay
10. Bonifacio Day (Monday nearest Nov 30)
11. Christmas Day (Dec 25) Art. 95 – Right to Service Incentive Leave
12. Rizal Day (Monday nearest Dec 30) Coverage: every ER who has rendered at least 1 year of service shall be entitled to a
yearly SIL of 5 days with pay
 Muslim Holidays  SIL not applicable to those already enjoying the benefit herein provided, those
– shall be observed in the provinces of Basilan, Lanao del Norte/ Sur, Maguindanao, North enjoying vacation leave with pay of at least 5 days, and those employed in
Cotabato, Sultan Kudarat, Sulu, Tawi-tawi, Zamboanga del Norte/Sur, cities of Cotabato, establishments regularly employing less than 10 EEs
Iligan, Marawi, Pagadian, and Zamboanga, and in such other Muslim provinces and cities  1“ year of service” service within 12 months, whether continuous or broken,
as may be created. Upon proclamation by the President, Muslim holidays may also be reckoned from the date the EE started working, including authorized absences and
officially observed in other provinces and cities paid regular holidays, unless the number of working days in the establishment as a
– PP 1198 all private corps, offices, and agencies operating within the provinces and matter of practice or policy, or provided initial the EMYPT contract is less than 12
cities enumerated herein shall observe the legal holidays as proclaimed, provided, that all months, in which case said period shall be considered as 1 year for the purpose of
Muslim EEs working outside of the Muslim provinces and cities shall be excused from work determining entitlement to the SIL
during the observance of Muslim holidays as recognized by law, without diminution of salary  SIL of part-time workers proportionate to the daily work rendered and the
during said period regular salary, respectively (DOLE Explanatory Bulletin dated January 2, 1996)
 Both Muslim and Christian EEs within the Muslim areas may not report for work on  “on contract” workers entitled to SIL
the designated Muslim holidays
 Commutation of SIL valid; basis of conversion shall be the salary rate at the date of
1. amun jadid (new year)
commutation; Availment and commutation of the SIL benefit may be on a pro-rata
2. mauled-un-nabi (birthday of Mohammed)
basis
3. lailatul isra wal mi rai (nocturnal journey and ascension of the Prophet Mohammed)
 SIL is mandatory
 a legal holiday falling on a Sunday creates no legal obligation for the ER to pay
Vacation and sick leaves are voluntary benefits
extra, aside from the usual holiday pay, to its monthly-paid EEs (Wellington
Investment vs Trajano)
Page 13 of 32
 Leave credits are normally converted into their cash equivalent based on the last prevailing - includes facilities (include articles or services for the benefit of the EE or his family but
salary received by the EE shall not include tools of the trade or articles or service primarily for the benefit of the ER or
necessary to the conduct of the ER’s business) or commodities (ER may provide them but
Paternity leave available only for the 1st four deliveries of the legitimate spouse with he may deduct their values from the EE’s wages distinguish facilities from supplements
whom the husband is cohabiting; delivery includes childbirth, miscarriage, or abortion (criterion: purpose)
shall not exceed 7 calendar days for each delivery
entitled to full pay Supplements – constitute extra remuneration or special privileges or benefits given to or
non-commutation of benefits received by the laborers over and above their ordinary earnings or wages.
Requisites:
1. he is an EE at the time of delivery of his child Facilities – items of expense necessary for the laborer’s and his family’s existence and
2. he is cohabiting with his spouse at the time she gives birth or suffers a miscarriage subsistence so that by express provision of law, they form part of the wage and when
3. he has applied for paternity leave furnished by the ER are deductible therefrom
4. his wife has given birth or suffered a miscarriage HOWEVER, re: meals and snacks deduction cannot be more than 70% of the value of
the meals and snacks, provided that such deduction must be authorized in writing by the
Maternity leave see discussion under Art 133 of LC EE; remaining 30% has to be subsidized by the ER
Parental (Solo Parent) Leave not more than 7 working days each year Lodging facility – value is determined to be the cost of operation and maintenance, including
non-convertible to cash if unused adequate depreciation plus reasonable allowance
requisites:
1. has rendered at least 1 year of service Requirements for deducting value of facilities (Mabeza v NLRC)
2. has notified ER of the availment thereof w/n a reasonable period of time 1. proof must be shown that such facilities are customarily furnished by the trade
3. has presented a Solo Parent ID to ER 2. provision of deductible facilities must be voluntarily accepted in writing by the EE
who is a solo parent? 3. facilities must be charged at fair and reasonable value
1. woman gives birth as result of rape or crime against chastity, provided she keeps -
and raises the child SALARY – denotes a higher degree of EMYPT, or a superior grade of services, and
2. spouse has died implies a position or office
3. spouse is detained or is serving sentence for at least 1 year  suggestive of a larger and more permanent or fixed compensation for
4. legally separated or de facto separated for at least 1 year, provided s/he is more important office
entrusted with custody  excludes allowances
5. physical/mental incapacity of spouse Songco v NLRC – sales commissions and allowances should be included in
6. abandoned by spouse for at least 1 year computation of separation pay
7. unmarried mother/father
8. any other person who solely provides parental care and support to a child GRATUITY – something given freely, or without recompense; a gift; something
9. any family member who assumes the responsibility of head of family voluntarily given in return for a favor or services; a bounty; a tip
 that which is paid to the beneficiary for past services rendered purely out of the
Art. 96 – Service Charges generosity of the giver or grantor
Covered EEs except those receiving more than P2,000 a month in case service charge  not intended to pay a worker for actual services rendered
is abolished, the share of covered EEs shall be considered as integrated in their wages fair day’s wage for fair day’s labor
basis shall be the average monthly share of each EE for the past 12 months immediately If there is no work performed by the EE there can be no wage or pay unless the laborer was
preceding the abolition or withdrawal of such charges pooled tips shall be monitored, able, willing and ready to work but was prevented by management or was illegally LOCked
accounted for, and distributed in the same manner as service charge out suspended or dismissed.

Title II – WAGES equal pay for equal work (think ISAE v Quisumbing case)
Chapter 1 – Preliminary Chapter DisLOCation factor and the foreign-hires’ limited tenure also cannot serve as valid bases
Art. 97 - Definitions: for the distinction are adequately compensated by certain benefits accorded them which are
WAGE – applies to the compensation for manual labor, skilled or unskilled, paid at not enjoyed by LOCal-hires, such as housing, transportation, shipping costs, taxes and
stated times, and measured by the day, week, month, or season home leave travel allowance.
- indicates inconsiderable pay for a lower and less responsible character of EMYPT
- includes sales commissions Art. 98 – Application of Title 2 (Wages)
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Not applicable to: 1. food and meal allowances
1. farm tenancy or leasehold 2. noncontributory retirement plan
2. domestic services 3. monthly emergency allowance
3. persons working in their respective homes in needle work or any cottage industry
4. workers employed in any establishment duly registered with the National Cottage Exceptions to the non-diminution rule
Industries and Development Authority 1. Correction of error
5. workers in any duly registered cooperative when so recommended by the Bureau 2. negotiated benefits
of Cooperative Development 3. wage order compliance
6. Barangay micro business enterprise any business entity engaged in the 4. benefits on reimbursement
production, processing, or manufacturing of products or commodities, including 5. reclassification of position/promotion made in good faith
agro-processing, trading and services, whose total assets including those arising ex: rank-and-file to supervisory lose overtime pay and other benefits under A
from loans but exclusive of the land on which the particular business entity’s office, 82-96 but A 100 is not violated (Nat’l Sugar Refineries Corp v NLRC)
plant and equipment are situated, shall not be more than P3M. 6. contingent or conditional benefits/bonus
7. wage orders issued by the wage boards under A 99 and 122  bonus is an amount granted and paid to an EE for his industry and loyalty
which contributed to the success of the ER’s business and made possible
Chapter 2 – Minimum Wage Rates the realization of profits; bonus is not a demandable and enforceable
Art. 99 - Regional Minimum Wages obligation BUT it is when made part of the wage or salary or
Statutory minimum wage – is the lowest wage rate fixed by law that an employer can pay compensation
his workers. Compensation which is less than such minimum rate is considered an 7. productivity incentives
underpayment that violates the law.
Equity or long practice as basis of bonus – even if bonus is not demandable; long and
By virtue of RA No. 6727 – Regional Wage Boards or the Regional Tripartite Wages and regular concession; fixed hope
Productivity Boards have issued wage orders fixing the minimum wages for their respective
regions. Services rendered as basis of bonus – right is not defeated by a “release and quitclaim”
Exemptions: upon termination (Marcos v NLRC – redundancy benefits)
a. household or DH, including family drivers and persons in the personal service of
another. Reduction of bonus not diminution of benefits - no profit, no bonus. Granting of bonus is
b. Homeworkers engaged in the needle-work basically a management prerogative (Traders Royal Bank v NLRC)
c. Workers employed in any establishment duly registered National Cottage
Industries and Development Authority to work at home Bonus as productivity incentives; EE’s share is in the nature of salary bonus proportionate
d. Workers in any duly registered cooperative to increases in current productivity over the average for the preceding 3 consecutive years;
“bonus” is not gratuity but the computed result of joint planning and effort; claimable only on
Exemptions from holiday pay and SIL apply to establishment employing less 10 EEs, the basis of predefined output level
meaning 1 to 9. On the other hand, the minimum wage exemption specifies not more than
10, meaning 1 to 10. With the 9 or fewer EEs the establishment is exempt is exempt from Art. 101 – Payment by Results
holiday pay and SIL, while 10 or fewer EEs – exempt from the minimum wage standard.
Workers paid by results [pay is calculated not on the basis of time spent on the job but of
Art. 100 – Prohibition against elimination or diminution of benefits the quantity and quality or the kind of work they turn out] grouped into 2:
NONDIMINUTION OF BENEFITS 1. those whose time and performance is supervised by the ER – embodies an
Requisites for application of nondiminution rule; element of control and supervision over the manner as to how the work is to be
1. grant of the benefit is founded on a policy or has ripened into a practice over a long performed
period ex: piece-rate worker
2. the practice is consistent and deliberate 2. those whose time and performance is unsupervised
3. the practice is not due to error in the construction or application of a doubtful or ex: pakiaw and takay workers
difficult question of law
4. the diminution or discontinuance is done unilaterally by the ER Payment by result not determinative of er-ee rel., only a method of compensation

Extent of the Rule

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Basis of output rate – the performance of an ordinary worker of minimum skill or ability those who are paid a fixed amount for performing work irrespective of the
[aka the average worker of the lowest producing group representing 50% of the total time consumed in the performance thereof.”
number of EEs engaged in similar EMYPT in a particular establishment, excluding learners,  entitled to overtime pay if their output pay rate is not shown to be in
apprentices, and handicapped workers employed therein accordance with the standards prescribed under the Implementing Rules
[Rule 7-A, Sec.5] or by the Secretary of Labor
Unsupervised piece-rate workers are not entitled to night differential pay and service  further, piece workers are specifically mentioned as being entitled to
incentive leaves holiday pay (Sec 8-B, Rule 4, Book 3)
 Revised Guidelines on the Implementing of the 13th Month Pay Law, in
RE: yearly commutation or cash conversion of the service incentive leave of piece-rate view of the modifications to P.D. 851 by Memorandum Order No. 28,
workers clearly exclude the ER of piece-rate workers from those exempted from
 based on their average daily earnings during the particular year of service paying the 13th month pay
which can be derived by dividing the amount earned during the year by  Entitled to overtime pay because respondent company did not allege
the actual number of working days or the statutory minimum rate, adherence to the standards set forth in Sec 8, Rule 7, Book 3
whichever is higher
In the absence of any agreement which provides otherwise, the amount earned during the Summation of benefits payable to Piece-rate workers
year may exclude COLA, overtime pay, and premium pay, holiday pay, night differential pay 1. minimum wage
and company fringe benefits 2. service incentive leave of 5 days with pay
3. night differential pay
Computation of service incentive leave of piece-rate worker get actual wage earned for 1 4. holiday pay
year, divide by 12 to get average monthly earnings then divide by the average number of 5. meal and rest periods
actual worked days in a month, multiply result by 5; if average daily rate is less than P36, 6. overtime pay (conditional)
basis for the computation is P36, the minimum rate outside Metro Manila. 7. premium pay (conditional)
8. 13th month pay
Other entitlements: 9. other benefits granted by law, by individual or collective agreement or company
1. holiday pay policy or practice
2. 13th month pay (if he has rendered at least 1 month work or service during the calendar
year) Chapter III Payment of Wages
Art 102. Forms of Payment
Variant Jurisprudence on Piece-rate workers’ entitlement to statutory benefits Forms of payment
a. Makati Haberdashery v NLRC 1. Proof of wage payment
Held: Where the EE alleges non-payment of wages and/or commission, the ER has the burden to
 workers are regular EEs although paid on piece-rate basis prove payment.
 entitled to minimum wage Jimenez et al v. NLRC (1996)
 as regular EEs, they can claim cost-living allowances, 13th month pay
 not entitled to service incentive leave pay and holiday pay because they Facts: EE Juanatas sued for full payment of his 20% commission of the gross income.
fall under one of the exceptions stated in Section 1(d), rule 5, There were cash advances may by the EE as evidenced by a notebook presented by the
Implementing Regulations, Book 3, Labor Code for being paid at a fixed ER.
amount for performing work irrespective of time consumed in the
performance thereof Held: Although the ER submitted a notebook showing the alleged vales, the same is
b. Labor Congress v NLRC inadmissible considering that it is not properly accomplished –undated, unsigned and is thus
Held: uncertain as to its origin and authenticity.
 piece-rate EEs are entitled to night shift differential, holiday pay, service The ER has the burden of proof to establish full payment of wages.
incentive leave, premium pay, and 13th month pay because they do not
fall within the group of workers who “are field personnel and other EEs The Implementing Rules require every ER to keep a payroll – showing length of time to be
whose time and performance is unsupervised by the ER, including those paid, the pay rate, amt actually paid, etc. The EE should sign the payroll
who are engaged on task or contract basis, purely commission basis, or
Art. 103. Time of Payment
Art. 104. Place of Payment
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Place of Payment ER-EE relationship may be declared to exist between the principal and the contractor’s
GR – should be near place of undertaking workers where the contracting arrangement is not legitimate. The contracting is not lawful,
Exemptions - nor legitimate, if it is
1. Payment cannot be effected at or near the place of work: 1. labor-only contracting
a. because of deterioration of peace & order 2. if the arrangement is otherwise considered unlawful for being against public policy
b. by reason of actual or impending emergencies caused by fire, flood, epidemic or
other calamity rendering payment thereat impossible; There is a LOC where the person supplying to an employer does not have substantial
2.When ER provides free transpo back & forth capital or investment on the form of tools, equipment, machineries, work premises, among
3.Under any analogous circumstances, provided: Time spent by EE in collecting their wages other, and the workers recruited, or placed by such person are performing activities which
shall be considered as compensable hours worked are directly related to the principal business of such ER.

No ER shall pay his EEs in any bar, night or day club, drinking establishment, massage D.O. No. 18-02
clinic, dance hall or other similar places, or in places where games are played with stakes of LOC is hereby prohibited. LOC refers to arrangement where the contractor or subcontractor
money or things representing money; except in the case of persons employed in said places merely recruits, supplies or places workers to perform a job, work a service, and any of the
following elements;
Art. 105. Direct Payment of Wages 1. does not have substantial capital which relates to the job, work, or service to be
Art. 106. Contractor or Subcontractor performed and the EEs recruited supplied are performing activities which are
Art. 107. Indirect ER directly related to the main business of the principal
Art. 108. Posting of Bond 2. does not exercise the right to control over the performance of the work of the
Art. 109 Solidary Liability contractual employee.

Contractor of Subcontractor LOC= EE + (CE1 or CE2)

1. Contracting and subcontracting in general  EE = essential element arrangement is merely to recruit, supply or
Contracting or subcontracting as an arrangement whereby a principal agrees to put out or place workers to perform a job, work or service for the principal
farm out with a contractor or subcontractor the performance or completion of a specific job,  CE1 = confirming element 1 lack of substantial capital or investment
work or service within a definite or predetermined period, regardless of whether such job, and performance of activities directly related to the principal’s main
work or service is to be performed or completed within or outside the premises of the business
principal.  CE2 = confirming element 2 contractor does not exercise control over
the performance of the EEs
4 features of legit contracting  LOC by presumption of law a full-pledged legitimate labor contractor
i. Parties – principal enters into a contract with subcontractor. has to be registered with DOLE, otherwise he is presumed to be an LOC
ii. Specific Job – performance or completion of a specific job, work or service
iii. Period – definite or predetermined period Substantial capital or investment
iv. LOCation – performed within or outside principal’s premises 1. Corporation – at least 3 Million paid-up capital stocks/shares
2. Single proprietorship – net worth of at least 3 Million
Legitimate contracting – job contracting by a legitimate contractor. What is contracted is the
performance and completion of a designated job, and just the supplying of people to do the Filipinas Synthetic Fiber v. NLRC (1996)
job. A contractor is a legitimate job contractor; Where the contractor is a going concern duly registered with the SEC with substantial
1. he conducts an independent business with capitalization of P1.6M, P400T of which is actually subscribed, such contractor cannot be
2. adequate capital to do the job and his people and considered as engaged in LOC being a highly capitalized venture.
3. exercises direct control over the performance of the workers.
Control – right reserved to the person for whom the service of contractual workers are
Trilateral relationship performed, to determine not only the end to be achieved but also the manner and means to
3 parties – principal, contractor and contractual EEs be used in reaching that end.
Bet principal and contractor – Civil code & pertinent commercial law
Bet contractor & EE – Labor code and special labor laws Insular Life v. NLRC (1989)
The fact that the complainant worker was required to solicit business exclusively for the
Prohibitions alleged ER could hardly be considered as control in labor jurisprudence. Under the memo
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issued by the Insurance Commission, insurance agents are barred from serving more than
1 insurance company.
AFP MBAI v.NLRC (1997)
Exclusive servicing does not necessarily mean being under the control, or EMYPT of the
entity being served.
Workers Cooperative cannot engage in Job contracting
Cooperative Development Authority Section 6 – Distinction and Authorized Activities
a. Labor Service Cooperative – the cooperative is engaged exclusively in job
contracting and subcontracting services to 3 rd party
b. Workers cooperative – this principally consists of providing employment and
business opportunities to its members and manages it in accordance with the
cooperative principles. It cannot engage in contracting or subcontracting
activity.
Consequence of LOC – Worker supplied by Agency becomes EE of client company
PBCOM v. NLRC (1986)
There is of course nothing illegal about hiring persons to carry out “a specific project or
undertaking the completion or termination of which (was) determined at the time of the
engagement of the EE, or where the work or service to be performed is seasonal in nature
and the EMYPT is for the duration of the season.
Given the circumstances of this case, CESI was engaged in LOC vis-à-vis the petitioner
bank. The bank is liable to the EE as if the EE had been directly employed not only by CESI
but also by the bank. But the bank may in turn proceed against CESI to obtain
reimbursement of, or some contribution to, the amounts which the bank will have to pay to
Orpiada.
Consequence of LOC – Agency hired EE becomes entitled to benefits under CBA of client
company
Tabas v. California Manufacturing Co (1989)
The existence of an ER-empoyee relation is a question of law and being such, cannot be
made the subject of agreement.
EE is reinstated with the full status and rights of regular EEs; all benefits as may be
provided by existing CBA or other relations or by law.
If the liability is in the nature of a penalty, such as back wages and separation pay because
of a wrongful dismissal, the liability should be solely that of the contractor if there is no proof
that the principal conspired with the contractor in committing the wrongful dismissal of the
contractor’s worker.
Legitimate Contracting – Independent Contractor/Job Contracting
Legitimate when the ff circumstances concur:
a. Contractor carries on a distinct and independent business & undertakes to perform
job, work or service on its own account and under its own resp, according to its
own manner and method and free from the control and direction of the principal in
all matter connected with the performance of work except as to the results thereof
b. Contractor has substantial capital or investment
c. Contractual agreement assures contractual EEs entitlement to all labor,
occupational safety and health standards, right to self organization, security of
tenure, social and welfare benefits.
In legitimate or valid contracting, what is contracted is the performance of a job and the
contractor is an independent businessman capable of doing the job by his own means and
methods. (Andovo v. MRR)
An independent contractor is one who exercises independent EMYPT and contracts to do a
piece of work according to his own methods and without being subject to control of his ER
except as to the result of the work. (Mafinco Trading v. Ople)
To restate, the significant factor in determining the relationship of the parties is the presence
or absence of supervisory authority to control the method and the details of performance of
the service being rendered and the degree to which the principal may intervene to exercise
such control (AFP MBAI v. NLRC).
Summary of Legitimate Labor Contracting
Legitimate when:
1. Contractor has substantial capital and/or investments
2. Properly registered in accordance with DO 18-02 does not fall under Sec 5 or 6 of
DO 18-02.
3. The Service Agreements ensures compliance with all the rights and benefits under
Labor law
Judicial Notice of Job Contracting
Neri v. NLRC
Judicial notice of general practice adopted in government & private institutions of hiring
independent contractor to perform special services – janitorial, security or even technical or
other specific services.
A manpower company may be a LOC in one case but an independent contractor in
another
Coca Cola Bottlers v. Hingpit
In 1st case, it failed to prove that Lipercon has substantial capital, investment, tools, etc. In
present case, Lipercon established its character as an independent contractor.
Escario v. NLRC
In earlier case of Tabas v. CMC, Livi was determined to be an LOC. But reliance of Tabas
case is misplaced because Livi was a mere placement agency that had simply supplied
CMC with manpower necessary to carry out the company’s merchandizing activity. But in
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this case, applying the 4-fold test in determining ER-EE relationship, the status of Admark Registration of contractor with DOLE regional office. An unregistered contractor is
as the true ER of the petitioners is further established. presumed to be a labor-only contractor.

Extent of Principal’s liability in legit contracting Art. 110 Worker Preference in case of bankruptcy
Contractor considered to be the ER of the contractual EE for purposes of enforcing the Worker preference in case of bankruptcy
provisions of the Labor Code and other Social legislation. (DO 18-02) Prerequisite- declaration of bankruptcy or judicial liquidation of ER’s business
Unpaid wages earned prior to declaration/liquidation shall be given 1st preference for
The principal shall be solidarily liable with the contractor in the event of any violation of the payment, even ahead of claims of govt.
provisions of the Labor Code, including failure to pay wages. (DO 18-02). Preference even to claims of govt for taxes (DBP v. NLRC)
Coverage of Preference
As to payment of wages/money claims Termination pay, separation pay, all other monetary claims.
When a contractor fails to pay the wages of his EEs in accordance with the Labor Code, the
ER who contracted out the job becomes jointly and severally liable with the contractor to the Art. 111 Atty’s Fees
extent of the work performed under the contract. as if such ER were the ER of the Attorney’s fees
contractor’s EE. (PBCOM v. NLRC) 1. Atty’s fees assessed”
Legislated wage increases are deemed amendments to the contract. (Rosewood a. cases of unlawful withholding of wages
Processing; also NFA) b. arising from CBA negotiations

As to other violations 2. Awarded Atty’s fee may not exceed 10%, but between lawyer and client quantum meruit
Under DO 18-02, Sec 7 par 1, indirect ER is solidarily liable. may apply (TRB EU v. NLRC)
Rosewood Processing v. NLRC 3. Non lawyers not entitled to atty’s fees (Five J Taxi v. NLRC)
Liability does not extend to the payment of backwages and separation pay of EEs who were 4. Since the union president is not the lawyer for the workers, he cannot be allowed to share
constructively or illegally dismissed by thec ontractor – no showing that principal conspired in the atty fees. (Amalgated Laborers Assoc v. CIR)
in effecting illegal dismissal. 5. Pao Lawyers
PAO lawyers disqualified from being awarded atty fees (Lambo v. NLRC)
An order to pay backwages and separation pay is invested with a punitive character such
that an indirect ER should not be made liable without a finding that it had committed ot
conspired in the illegal dismissal. Chapter IV Prohibition Regarding Wages
Art. 112. Non-interference in disposal of wages
Solidary Liability - Limitation – to extent of work performed under contract, to perf of any 1. Civil Code Provisions
work, task job or project, to extent of their civil liability on payment of wages. a. Art 1705 CC: paid in legal currency
b. Art 1706 CC: withholding of wages, except for a debt due, shall not be made by the
Rights of contractual EEs ER
Contractual EEs entitled to all rights and privileges due a regular EE as provided under c. Art 1707 CC: Labor’s wages shall be a lien on goods manufactured or work done.
labor code to include: d. Art 1708 CC: wages not subject to execution or attachment, except for debts
a. safe and healthful working conditions incurred for food, shelter, clothing and medical attendance
b. Labor standards e. Art 1709 CC: ER shall neither seize nor retain any tool or other articles belonging
c. Social security and welfare benefits to the laborer.
d. Self organizations, CBA, peaceful concerted action
e. Security of Tenure Art. 113. Wage Deduction
Wage deduction
Security of Tenure Authorized deductions by law:
In case of pre-termination of contract bet principal & contractor – governed by applicable a. Value of means and other facilities
laws b. Premium paid by ER where insured with EE’s consent
Expiration of contract bet principal & contractor – not entitled to separation pay c. Union to check off recognized by ER/ authorized in writing by indiv EE
d. EE is indebted to ER, due & demandable
Registration of Contractors e. Subject to execution for debts incurred for food, shelter clothing and medical
attendance
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 f. Withholding tax
g. Salary deductions cooperative Chapter V. Wage studies, wage agreements and wage determination
h. SSS, Medicare, Pag-ibig Art. 120 Creation of National Wages and Productivity Commission
National Wages and Productivity Commission created by RA 6727.
Payment to 3rd person Art. 121. Powers and Functions of the Commission
Authorized in writing by EE Art. 122. Creation of the RTWPB
ER agrees to make deduction
ER must not receive any pecuniary benefit, directly or indirectly from transaction. Regional Tripartite Wages and Productivity Boards
Composed of:
Unjustified Work reduction: constructive Dismissal a. DOLE Regional Director - chairman
Philippine Graphic Arts, Inc vs NLRC b. NEDA Regional Director – vice chair
The Court upheld the validity if the reduction of working hours, taking into consideration the c. DTI Regional Director – vice chair
following: d. 2 – workers sector
a. the arrangement was temporary e. 2 – ERs sector
b. it was more humane solution instead of a retrenchment or personnel
c. there was notice and consultations with the workers and supervisors While the RTWPB has the power to issue wage orders under Art 122 (b) of the Labor Code,
d. a consensus was reached on how to deal with deteriorating economic conditions such orders are subject to the guidelines prescribed by the National Wages and Productivity
and it was sufficiently proven that the company was suffering from losses. Commission (NWPC), who has the power to prescribe the rules and guidelines for the
determination of appropriate wages in the country.
Where business reverses were not proved and, instead, it was shown that the work
reduction/rotation was implemented soon after the affected EEs filed complaints for labor Art. 123 Wage Order
standards violations by the employer, the count invalidated the work reduction and Wage Fixing Order
construed it as constructive dismissal a. Issuance of Wage Order – within 30x after conclusion of the last hearing, issue a
. wage order establishing the regional minimum wage rates not lower than the
Art. 114. Deposits for Loss or Damage applicable statutory minimum wage rates.
Art. 115. Limitations b. Contents of wage order – it shall specify the region, province or industry to which
Deductions for Loss or Damage the minimum wage rates prescribes under the order shall apply and provide
(1) EE clearly shown to be responsible for loss or damage exemptions, if any, subject to guidelines issued by the commissioner.
(2) EE given ample opportunity to show cause why deduction should not be made c. Frequency of wage order – may not be disturbed for period of 12 months except
(3) deduction fair and reasonable and shall not exceed actual loss or damage supervening cause
(4) deduction not exceed 20% of EE’s wages in a week d. Effectivity of wage order – shall take effect 15 days after its publication in at least 1
newspaper
Art. 116 Withholding of wages and kickbacks prohibited e. Implementing Rules/Regulations of the Wage order – not later than 10x from the
Art. 117. Deduction to Ensure EMYPT issuance of Wage order
Art. 118 Retaliatory Measures f. Review of Wage Order – motu proprio or upon appeal. Grounds;
Are retaliatory measures (Art 118) striakeable? 1. Non-conformity with the prescribed guidelines and/ or procedure
Acts under Art 118 are broad, and can lead to a ULP case if ER retaliated against testifying 2. Questions of law
EE. If ULP, strikeable. 3. Grave abuse of discretion

Both Articles 118 and 258 prohibit retaliation or reprisal against such employee. But they
differ on the subject of testimony.
1. Article 118, the subject testimony is wages and the ER’s retaliatory act is unlawful
but does not constitute ULP.
2. Article 258 (f) the subject testimony is anything under the Labor Code, it is ULP,
hence, a reason for work stoppage or strike by the EEs.
Reprisal for Silent Testimony
Art 118 equally applies to implicit or unspoken testimony by an EE.
NOTE: NWPC prescribes rules and guidelines for determination of appropriate minimum
wage and productivity measures at the regional, provincial or industry levels. BUT Wage-
fixing order by the RTWPB does not need prior approval by the NWPC.
RTWPB- empowered to determine and fix minimum wage rates applicable in their regions
and to issue corresponding wage orders in accordance with the guidelines set by NWPC.
NWPC- has the power to review regional wage levels, to review plans and programs of the
RTWPB, and to exercise technical and administrative supervision over the RTWPB.
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Art. 124. Standards/Criteria for Min Wage Fixing 5 regional offices enforce the labor laws
Standards/Criteria for Min wage fixing 1. DOLE
a. Living Wage 2. TESDA
b. Consumer price index 3. RAB (Regional Arbitration Board) of the NLRC which handles compulsory
c. Cost of living arbitration cases affecting labor and management, aside from enforcing decisions,
d. Needs of workers and their families awards or orders of the NLRC.
e. Induce industries to invest in countryside 4. NCMB which has absorbed the conciliation, mediation, and voluntary arbitration
f. Improvements in standards of living functions of the BLR
g. Prevailing wage levels 5. RTWPB which determines minimum wage applicable in the region and issues
h. Fair return of capital wage orders, subject to guidelines from the National Wages and Productivity
i. Effects on EMYPT generation and family income Commission.
j. Equitable distribution of income and wealth
SCOPE of Visitorial- Enforcement power under Article 128
Two methods of minimum wage adjustment  The Secretary of Labor and Employment and his duly authorized representative, in
1. Fixing the determinate amount that would be added to the prevailing statutory the exercise of their visitiorial and enforcement powers, are now authorized to
minimum wage issue compliance orders to give effect to the labor standards provisions of this
2. Salary-ceiling method whereby the wage adjustment is applied to EEs receiving a Code and other labor legislation based on the finding of labor employment and
certain denominated salary ceiling. enforcement officers or industrial engineers made in the course of inspection.

Wage distortion – situation where an increase in prescribed wage rates results in the Who determines the existence of ER-EE relationship: BOMBO RADYO ruling
elimination or severe contraction of intentional quantitative differences in wage of salary  DOLE has the authority to determine the existence of and ER-EE relationship,
rates among EE groups, obliterating the distinctions as to skills, length of service or other subject to judicial review, not review by the NLRC.
logical bases of differentiation.  For the RD to exercise the enforcement power under Article 128(b), the work must
be existing at the time the complaint is presented.
Salary distortion – results from the disappearance or virtual disappearance of pay  Has the power to order and administer, after due notice and hearing, compliance
differentials (between lower and higher positions or between senior and junior EEs) with the labor standards provisions of the Labor Code and other legislation.
because of compliance with a wage order.  RD exercises both visitiorial and enforcement power over labor standard cases,
and is therefore, empowered to adjudicate money claims, provided there still exists
Distortion adjustment formula (Metro Bank v. NLRC): ER-EE relationship and the findings of the regional office are not contested by the
Minimum wage / actual salary = % x prescribed increase = distortion adjustment ER concerned.
Art. 125 Freedom to Bargain In order to divest the RD or his representatives of jurisdiction (will have to endorse the case
Organized vs unorganized establishments to the appropriate Arbitration Branch of the NLRC), the following elements must be present;
a. That the ER contests the findings of labor regulations officer and raises
Art. 126 Prohibition against Injunction issues herein
Art. 127. Non-Dimunition of Benefits b. That in order to resolve such issues, there is need to examine evidentiary
matters
Chapter VI Administration and Enforcement c. That such matters are not verifiable in the normal course of inspection
Art. 128. Visitorial and Enforcement Power
Appeal under Article 128 is appealable to DOLE Secretary, the administrative superior of
DOLE primary responsibility: the regional director. The decision of the Secretary becomes final and executor after 10
1. Promotion of gainful employment opportunities and the calendar days from receipt of the records of the case, then MR as precondition for any
optimization of the development and utilization of the country’s further or subsequent remedy. SCA for certiorari under Rule 65 may be file to CA with 60x
resources form receipt of the denial of MR.
2. The advancement of worker’s welfare by providing for just and
humane working conditions and terms of employment Art. 129. Recovery of wages, simple money claims and other benefits
3. The maintenance of industrial peace

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RD is empowered, through summary proceedings and after due notice, to hear and decide
cases involving recovery of wages and other monetary claims following the requisites:
1. The claim is presented by the EE, or a person employed in domestic or household
service, or house helper
2. The claim arises from ER-EE relationship
3. The claimant does not seek reinstatement
4. The aggregate money claim of each claimant does not exceed P5,000.00
Absence of any of the above requisites, the LABOR ARBITER shall have the exclusive
original jurisdiction over claims arising from ER-EE relations.
Article 128 and Article 129 compared;
 As to nature and subject of the proceedings
Article 128 speaks of inspection of establishment and the issuance of
orders to compel compliance with labor standards, wage orders and other labor
laws. It covers enforcement of labor legislation in general.
Article 129 refers to adjudication through summary proceedings of EEs
claim for wages and benefits. It covers monetary claims which therefore involve
only labor standards law.
 As to workers involved
Article 128 EEs still in service
Article 129 applies to present or past EEs at the time the complaint was
filed, provided no demand for reinstatement.
 A to jurisdiction limit
Article 128- the law fixes no maximum monetary amount for the exercise
of enforcement of power
Article 129 – the amount of money claim per claimant should not exceed
P5000.
 As to officers designated
Article 128- the person exercising the visitiorial- enforcement power is
Secretary of Labor
Article 129 – vested upon the RD or any duly authorized hearing officer of
the DOLE
 As to Appeal
Article 128 – appealable to Secretary of Labor and Employment
Article 129- NLRC
Art. 135. Discrimination Prohibited
Discrimination prohibited
solely on account of her sex
RA 7192 provides that “the state recognizes the role of women in nation-bldg and shall
ensure the fundamental equality before the law of women and men. The State shall provide
women rights and opportunities equal to that of men.”
To attain this policy:
1. substantial portion of Official Devt Funds set aside & utilized by agencies to
support programs & activities for women;
2. All govt depts. Ensure that women benefit equally & participate directly in devt
programs & projects of said depts.; and
3. All depts. And agencies shall review & revise regulations, circulars, issuances and
procedures to remove gender bias therein.
Prohibited acts: (Art 137)
1. Deny any woman EE benefits or discharge woman for purpose of preventing her
from enjoying benefits under this code
2. Discharge woman on acct of her pregnancy
3. Refuse admission of such woman upon returning to work for fear that she may
again be pregnant
Art 138 Classification of certain women workers
Any woman working in any night club, cocktail lounce, massage clinic, bar or similar
establishment, under the effective control of the ER for a substantial period of time
condiered EE of such establishment
Zialcita v. PAL (1977) – Office of the President decision
We cannot agree to the respondent PAL’s proposition that termination from EMYPT of flight
attendants on account of marriage is a fair and reasonable standard designed for their own
health, safety, protection and welfare, as no basis has been laid therefore. Actually,
respondent claims that its concern is not so much against the continued EMYPT of the flight
attendant merely by reason of marriage but rather on the consequence of marriage –
pregnancy. Xxx The sweeping intendment of the law, be it on special or ordinary
occupations is reflected in the whole text and supported by Art 135 that speaks of
nondiscrimination on the EMYPT of women.

Art. 132 Facilities for Women PT&T v. NLRC

Art. 133. Maternity Leave (obsolete) Similar to the Zialcita case except that the ER did not admit that the EE was dismissed
because she was married. The cause of the dismissal, the ER insisted, was her dishonesty
Maternity leave benefits (now under SSS law) in stating in the job application that she was single though in fact she was not.
Pre-req: at least 3 monthly contributions in 12 month period immediately preceding
semester of childbirth or miscarriage: PT&T’s policy that married women are not qualified for EMYPT in PT&T is not only in
60 days salary credit derogation of the provisions of Art 136 on the right of women to be free from any kind of
78 days in case of caesarian delivery stipulation against marriage in connection with her EMYPT, but it likewise assaults good
Paternity Leave (RA 8187) – legit married, living with spouse morals and public policy tending as it does to deprive a woman of the freedom to choose
Maternity leave benefits apply to married or unmarried women. her statusl, a privilege that by all accounts inheres in the individual as an intangible and
inalienable right.

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Gualberto v. Marinduque Mining (1978) – CA Case
Whether pre-EMYPT agreement or company policy, the policy of the firm to consider, due to
lack of facilities for married women, female EEs as separated the moment they get married,
is void. No ER may require female applicants for jobs to enter into preEMYPT agreements
that they would be dismissed once they get married.
Workplace – OFFICE, PREMISES or WORKSITE where the workers are
HABITUALLY employed and shall include the office or place where the workers who
have no fixed or definite worksite REGULARLY REPORT for assignment in the course
of their EMYPT.

Art. 137. Prohibited Acts First Aider – any person trained and duly certified as qualified to administer
Art. 138. Classification of Certain Women Workers. first aid by PHILIPPINE NATIONAL RED CROSS or any other organization accredited
Sexual Harassment with the former.
RA 7877
Victim may be male or female. Medicines and Facilities:
Elements: DRR AIMA  An ER shall keep in or about his workplace first-aid medicines, equipment and
Demand/Request/Require sexual favor facilities prescribed by the Department of Labor 5 days from issuance of regulation
Authority, influence or moral ascendancy over victim  The list may be revised anytime by the Bureau of Labor Standards, subject to
Punishes sexual harassment if same is: approval of the Secretary of Labor.
(1) work related Emergency Medical and Dental Services:
(2) education related Number of EEs
(3) training related Medical and Dental Services
Excluded: Hazardous
Saleswoman-Client relations but RPC, Independent Civil Actions Non-Hazardous
EE-EE but file case with company based on company rules 10 to 50 in a workplace
Duty of ER or head of office Graduate First-aider, and may be one of the workers in the workplace AND who has
1. To prevent or deter the commission of acts of sexual harassment and provide immediate access to the firs-aid medicine prescribed in Section 3
procedures for resolution or prosecution of acts of sexual harassment Exceeds 50 but not more than 200
2. To promulgate rules and regulations prescribing procedure for investigation of Full-time Registered Nurse
sexual harassment cases and admin sanctions therefore Full-time First-aider IF a Nurse is not available
3. To create committee on decorum and investigation of cases on sexual harassment Exceeds 200 but not more than 300
Full-time Registered Nurse
Article 156: FIRST-AID TREATMENT Part-time Physician
Article 157: EMERGENCY MEDICAL AND DENTAL SERVICES Part-time Dentist
Article 158: WHEN EMERGENCY HOSPITAL NOT REQUIRED Emergency Clinic
Article 159: HEALTH PROGRAM
Article 160: QUALIFICATIONS OF HEALTH PERSONNEL The Physician and the dentist shall stay in the premises for at least 2 hours a day.*
Article 161: ASSISTANCE OF ER Exceeds 300
COMMENTS Full-time Nurse
The Implementing Rules in Book IV, Rule I, provide details additional to those in the above Full-time Physician
codal provisions: Full-time Dentist
 Coverage: The Rule shall apply to ALL ERs whether operating for profit or not, Dental Clinic and Infirmary OR Emergency Hospital with One bed capacity for every 100
including the Government and any of its political subdivisions and government- workers
owned or controlled corporations, which employ one or more workers Full-time Registered Nurse
 Bureau of Dental Health Services of DOH: in charge of the development of dental Part-time Physician
standards Part-time Dentist
 Definition: Shall have same responsibilities as those provided in previous box
First Aid Treatment – ADEQUATE, IMMEDIATE, and NECESSARY, medical The Physician and the Dentist shall stay in the premises of the workplace for at least 8
and dental attention or remedy given in case of injury o sudden illness suffered by a hours a day*
worker during EMYPT, irrespective of whether or not such injury or illness is work- *Where the establishment has more than one workshift a day, the required two-hour stay
connected, BEFORE more extensive medical and/or dental treatment can be secured. shall be devoted to the workshift which has he biggest number of workers and they shall, in
It does not include continued treatment or follow-up treatment for any injury or illness.
Page 23 of 32
addition to the requirements of this Rule, be subject to call at anytime during the other Article 163: RESEARCH
workshifts to attend to emergency cases. Article 164: TRAINING PROGRAMS
** In all workplaces where there are more than one workshift in a day, the ER shall, in Article 165: ADMINISTRATION OF SAFETY AND HEALTH LAW
addition to the requirements of this rule, provide for the services of a full-time first-aider for COMMENTS
each workshift. The Implementing Rules in Book IV, Rule II, provide details additional to those in the above
Emergency Hospital: An ER need not put up and emergency hospital or dental clinic in codal provisions:
the following situations: Coverage: The Rule shall apply to ALL establishments, workplaces and other
o Urban Area – where there is a hospital or dental clinic not more than 5 kilometers away undertakings except:
from the workplace OR which can be reached by motor vehicle in 25 minutes of travel o Those engaged in land, sea and air transportation
o Rural Area - the ER has facilities readily for transporting a worker to the hospital or clinic Provided: that their dry docks, garages, hangars, maintenance and repair shops and
in case of emergency offices, shall be covered by this Rule
o The ER must enter into a written contract with the hospital or dental clinic for the use o Residential places exclusively devoted to dwelling purposes
thereof in the treatment of workers in case of emergency. *GR: Department of Labor has jurisdiction to inspect all establishments, workplaces and
Training and Qualifications of Medical and Dental Personnel: undertakings.
Personnel Exception: Chartered cities may be allowed to assume responsibility for technical safety
Requirements inspection upon compliance with such standards and guidelines as the Secretary of Labor
First-aider may promulgate
Must be able to read and write
Completed a course in first-aid duly certified by the National Red Cross or any other *Technical Safety Inspection includes inspection for purposes of safety determination of
organization accredited by the same boilers, pressure, wheels, internal combustion engines, elevators (passenger and freight),
Nurse dumbwaiters, escalators, and electrical installations in all workplaces.
Passed the examinations given by the Board of Examiners
Duly licensed to practice nursing in the Philippines and preferably with at least 50 hours Work Condition not covered by standards: Any specific standards applicable to a
of training in occupational nursing conducted by condition, practice, means, method, operation, or process shall also apply to other similar
o DOH work situations for which NO specific standards have been established.
o Institute of Public Health of UP; OR
o Any organization accredited by the former Training of Personnel in safety and Health: Every ER shall take steps to train a sufficient
Physician number of his supervisors or technical personnel in occupational safety and health.
Passed the examination given by the Board of Examiners Number of EEs
Licensed to practice medicine in the Philippines Training
Preferably a graduate of a training course in occupational medicine conducted by the Hazardous
o Bureau of Labor Standards Non-Hazardous
o Institute of Public Health of UP 50 to 400 each shift
o Or any organization accredited by the former At least one of the supervisors or technical personnel shall be trained in occupational health
Dentist and safety and shall be assigned as part-time safety man. Such safety man shall be the
Passed the examinations given by the Board of Examiners secretary of the safety committee
Licensed to practice in the Philippines Over 400 workers per shift
Preferably has completed a training course in occupational dentistry conducted At least two of its supervisors shall be trained and a full time safety man shall be provided
20 to 200 each shift
o Bureau of Dental Services of DOH At least one of its supervisors or technical men shall be trained who shall work as part-time
o OR any organization duly accredited by the former safety man. He shall be the secretary of the safety committee
Opportunity for Training: Over 200 workers each shift
Hazardous Workplaces At least two of its supervisors or technical personnel shall be trained and one of them shall
Health Program be appointed full-time safety man and secretary of safety committee therein.
Medical and Dental Records * The EMYPT of a full-time safety man may not be required where the ER enters into a
Chapter II written contract with a qualified consulting organization which shall develop and carry out
OCCUPATIONAL HEALTH AND SAFETY his safety and health activities. Provided, that the consultant shall conduct plant visits at
Article 162: SAFETY AND HEALTH STANDARDS least four hours a week and is subject to call any time to conduct accident investigations
Page 24 of 32
and is available during scheduled inspections or surveys by the Secretary of Labor or his
authorized representatives.
* The provisions of this Section shall be made mandatory upon orders of the Secretary of
Labor as soon as he is satisfied that the adequate facilities on training in occupational safety
and health are available in the Department of Labor and other public or private entities duly
accredited by the Secretary of Labor
General duties of workers:
a. Every worker shall cooperate with the ER in carrying out the provisions of this Rule
b. Every worker shall make us of ALL safeguards and safety devices furnished in
accordance with the provisions of this Rule for his protection and the protection of
others and shall follow ALL instructions made by the ER in compliance with the
provisions of this Rule.
Duties of Other persons: Any person, including builders or contractors, who visits, builds,
innovates or installs devices in establishments or workplaces shall comply with the
provisions of this Rule and all regulations issued by the ER in compliance with the
provisions of this Rule and other subsequent issuances, of the Secretary of Labor.
Training
Article 166: POLICY
COMMENTS AND CASES
1. OVERVIEW: WORKMEN’S COMPENSATIONS PROGRAM AND SIF
Workmen’s Compensation is a general and comprehensive term applied to those laws
providing for compensation for loss resulting from the INJURY, DISABLEMENT, or DEATH
of workmen through INDUSTRIAL ACCIDENT, CASUALTY or, DISEASE.
Compensation means the money relief afforded according to the scale established under
the statute, as differentiated from “compensatory damages” recoverable in an action at law
for breach of contract or for tort
Amount of Compensation generally determined in accordance with a definite schedule,
based on the loss of earning power, the usual provision being for the payment of a specified
amount at regular intervals over a definite period. Provision is also made, in most instances,
for the furnishing of medical, surgical, hospital, nursing, and burial services in addition to
independently of the payment of compensation.
Primary Purpose is to provide compensation for disability or death resulting from
occupational injuries or diseases, or accidental injury to, or death of, EEs. It is for the benefit
of the EES and not the ER.
It is not Charity but recognition of a moral duty and erection of it into a legal obligation of the
PUBLIC not only of that of the ER.
Based on the Idea that liability arising out of ER’s negligence is inapplicable to modern
conditions of EMYPT because of highly organized and hazardous industries of modern
times. The causes of injuries are often so obscure and complex that it is usually impossible
to ascertain the fact to from an accurate judgment. Further litigation causes expense and
delays that defeats justice and antagonisms between ER and EE. Basically, the theory of
negligence is discarded as the basis of liability, and in general a right to compensation is
given for all injuries incident to the EMYPT, the amount is limited to a given schedule.
Purpose
 Improve the economic status of the worker
 Obviate uncertainties, delay, expense, and hardship attendant upon the
enforcement of court remedies
 Transfer from the worker to the industry in which he is employed, and ultimately to
the consuming public, a greater proportion of the economic loss due to industrial
accidents and injuries.
 Improve the relations between ERs and EEs by avoiding or reducing the friction
incident to litigation.
 Provide, not only for EEs a remedy which is both expeditious and independent of
proof of fault, but also for ERs a liability which is limited and determinate.
Statutorily given Right which both create and measure the right
Source of Compensation:
1. Direct Payment Statutes – payment by the ER
2. Insurance Statutes
a. require the ER to take out insurance either with
i. an insurance bureau operated by the state
ii. private company
b. require and ER to contribute to a compensation fund –State Insurance
Fund the Labor Code adopts the compensation fund type. All covered
ERs are required to remit to a common fund a monthly contribution
equivalent to one percent of the monthly salary credit of every covered
EE. The EE pays NO contribution into the fund; agreement to the contrary
is VOID and PROHIBITED.
Process:
1. Injury befalls the EE
2. Within 5 days must notify ER, if notification is required, who in turn ,must enter
notice in the logbook
3. Within 5 days after entry report the sickness, injury or death deemed work
connected to:
a. SSS in private sector or;
b. GSIS in public sector
Note: The ER INITIALLY decided whether the injury, sickness or death is work
related or not.
4. The claim is decided by the SSS or GSIS. Decisions of the two administering
agencies are appealable to the EEs’ Compensation Commission, which is the
policy making body, within 30 days.
a. If the result of the appeal is favorable to the EE becomes final and
executory, appealable to the SC in limited cases
b. If SSS or GSIS is reversed the two systems cannot appeal to the high
court.
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PD 626 AND ITS EFFECTIVE DATE
PD 626 amended extensively the Labor Code provisions on ECC and SIF. It applies only
prospectively. Because it took effect on January 1, 1975 it applies to illness contracted on
or after that date. For those contracted before said date the applicable law is the workmen’s
compensation act its commission was finally abolished on March 31, 1976.
VALIDITY OF PD 626: NATURE OF THE STATE INSURANCE FUND
Jose B. Sarmiento vs. EEs’ Compensation Commission, et. al. - PD 626 does not infringe
upon the worker’s constitutional rights. The said new law discarded the concepts of
“presumption of compensability” and “aggravation” to restore what the law believes as a
sensible equilibrium between the ER’s obligation to pay and the EE’s right to receive
reparation.
The new law establishes a state insurance fund built up by the contributions of ERs based
on the salaries of their EEs. The injured worker does not have to litigate his right to
compensation. No ER opposes his claim. There is no notice of injury or requirement of
controversion. The sick worker simply files a claim with a new neutral ECC which then
determines on the basis of EE’s supporting papers and medical evidence whether or not
compensation may be paid. The payment of benefits is more prompt. The cost of
administration is low. The amount of death benefits has also been doubled.
Trust Fund
It is now the trust fund and not the ER that suffers if benefits are paid to the claimants who
are not entitled under the law. The ER joins the EE in trying to have their claims approved.
The ER is spared the problem of proving a negative proposition that the disease was not
caused by EMYPT.
Social Insurance
EEs compensation is based on social security principles. All covered ERs throughout the
country are required to contribute fixed and regular premiums or contributions to a trust fund
for their EEs. Benefits are paid from this trust fund. At the time the amount of the
contributions was being fixed, actuarial studies were undertaken. The actuarially determined
number of workers who would probably file claims within any given year is important in
insuring the stability of the trust fund and making certain that the system can pay its benefits
due to all who are entitled and in the increased amounts fixed by law. Thus, if diseases no
intended by the law to be compensated are inadvertently or recklessly included the integrity
of SIF is endangered.
WORKMEN’S COMPENSATION ACT DISTINGUISHED FROM EES’ COMPENSATION
LAW
Under the present law, in order for the EE to be entitled to sickness or death benefits, the
sickness of death resulting there from must be, or must have resulted from either;
a. Any illness definitely accepted as an occupational disease listed by the
Commission
b. Any illness caused by the employment subject to proof that the risk of contracting
the same is increased by working conditions.
Presumptive Compensability for AFP Members and Policemen
In a limited sense, Presumption of Compensability has been restored through Resolution No
3906, adopted on July 5, 1988 by the ECC which states:
This board resolves, as it hereby resolves, to approve the adoption of a policy that the
moment an AFP member suffers a contingency, the presumption is that it is because of the
nature of his work; provided that the evidentiary details of his injury, or death, are clearly
established through duly issued medical certifications on his injury or injuries, or death, by
the attending physician or duly authorized representatives of the hospital where he is
brought for medical treatment.
LIBERAL INTERPRETATION
The ECC should adopt a liberal attitude in favor of the EE in deciding claims for
compensability, especially where there is some basis in the facts for inferring a work-
connection to the accident. This kind of interpretation gives meaning and substance to the
compassionate spirit of the law as embodied in Article 4 of the New Labor Code.
However, it is not the intention of the legislature the insurer against all accidental injuries
which might happen to an EE while in the course of the EMYPT, but only for such injuries
arising from, or growing out of, the risks peculiar to the nature of the work in the scope of
the workmen’s EMYPT or incidental to such EMYPT, and accidents in which it is possible to
trace the injury to some risk or hazard to which the EE is exposed in a special degree by
reason of such EMYPT.
Article 167: DEFINITION OF TERMS
COMMENTS AND CASES
COMPENSABLE WORK-RELATED INJURY DEFINED
What is compensated is not the injury or the disease itself but the attendant loss or
impairment of earning capacity.
Rule III, Section 1(a):
For the injury and the resulting disability or death to be compensable, the injury must be the
result of an EMYPT accident satisfying all the following grounds:
1. the EE must have been injured at the place where his work requires him to be;
2. the EE must have been performing his official functions; and
3. if the injury is sustained elsewhere, the EE must have been executing an order for
the ER
MEANING OF “ARISING OUT OF” AND “IN THE COURSE OF” THE EMYPT
Arising out of refer to the origin or cause of the accident and are descriptive of its
character
In the course of the EMYPT – when it takes place within the period of the EMYPT, at a
place where the EE reasonable may be, and while he is fulfilling his duties or is engaged in
doing something incidental thereto.
Page 26 of 32
Accident need not be foreseen or expected it is sufficient that after the event it appears to
have its origin in a risk connected with EMYPT, and to have flowed from that source as a
rational consequence.
Nature and Degree of relation there is an existing conflict of views whether should be
inherent to the EMYPT (conservative view) or it is sufficient that EE was exposed by reason
of EMYPT, not necessary that inherent (liberal view). It has been stated that an accident
arise out of EMYPT if it ensues from a risk reasonably incident to the EMYPT, and if it is in
some sense due to the EMYPT. Again, the view has been taken that an injury arises out of
the EMYPT if the EMYPT is one of the contributing causes without which the accident which
actually happened would not have happened. The position has also been taken that an
accident arises in the course of EMYPT if it had its origin there in the sense that it was the
end-product of a force or cause set in motion in the course of EMYPT.
No Precise Formula for Sphere of EMYPT: Generally, time and place of and the
circumstances surrounding its occurrence. Sphere of EMYPT varies, dependent upon the
nature of the work and terms and conditions in the hiring contract.
Not necessary it should have occurred during hours of active labor or in premises or within
control of ER, EMYPT includes not only the actual doing of work, but also reasonable
margin of time and space necessary to be used in passing to and from the place where the
work is to be done, where the latter is expressly included in the terms of EMYPT
PROXIMATE CAUSE
It is the sufficient cause, which may be the most remote of an operation chain. It must be
that which sets the others in motion and is to be distinguished from a mere preexisting
condition upon which the effective cause operates, and must have been adequate to
produce the resultant damage without the intervention of an independent cause.
Where the primary injury is shown to have arisen in the course of EMYPT, every natural
consequence that flows from the injury likewise arises out of the EMYPT, unless it is the
result of an independent intervening cause attributable to claimant’s own negligence or
misconduct. Simply stated, all medical consequences and sequels that flow from the
primary injury are compensable.
Illustrative Case: Proximate Cause
Belarmino vs. EEs’ Compensation Commission –The condition of the classroom floor
caused Mrs. Belarmino to slip and fall and suffer injury as a result. The fall precipitated the
onset of recurrent abdominal pains which culminated in the premature termination of her
pregnancy with tragic consequences to her. Her fall on the classroom floor brought about
her premature delivery which caused the development of septicemia postpartum which
resulted in death. Her fall was the proximate or responsible cause that set in motion an
unbroken chain of events leading to her, demise. True, that she probably would not have
suffered lacerations of the vagina and would not have contracted the fatal infection. But she
is not to blame for her inability to afford a hospital delivery and the services of a trained
doctors and nurses. Penury compelled the deceased to scrimp by delivering her baby at
home instead of the hospital.
Arising Out/In the Course of EMYPT
Hinoguin vs. EE’s Compensation Commission – The death of Sgt. Hinoguin that resulted
from his being hit by an accidental discharge of his companion’s rifle arose out of and in the
course of his EMYPT as a soldier on active duty status in the AFP, and hence
compensable. The concept of “workplace” cannot always be literally applied to a soldier on
active duty status. A soldier must go where his company is stationed. Sgt. Hinoguin and his
companions had permission to proceed to Aritao. This is a place where soldiers have
secured lawful permission to be and cannot be very different from a place where they are
required to go by their commanding officer. Hinoguin and his companions were not on
vacation leave. They are authorized to carry their firearms with which they were to defend
themselves if NPA elements happen to attack them.
A soldier should be presumed to be on official duty unless he is shown to have clearly and
unequivocally put aside that status or condition temporarily by, e.g. going on approved
vacation leave. Even vacation leave may be pre-terminated by superior officers.
The 24-Hour Duty Doctrine and Its Qualifications; Moonlighting Policemen
Soldiers and policemen and even firemen by the nature of their work may be considered on
duty round-the-cLOCk. But this doctrine, while it relaxes the workplace factor does not
dispense with the work-connection requisite.
GSIS vs. CA and F. Alegre – From the cases (Hinoguin vs. ECC, Nitura vs. ECC and ECC
vs. CA), it can be gleaned that the Court did not justify its grant of death benefits merely on
account of the rule that soldiers or policemen, as the case may be, are virtually working
round-the-cLOCk. Note that the court likewise attempted in each case to find reasonable
nexus between the absence of the deceased from his assigned place of work and the
incident that led to his death.
Obviously, the matter SPO2 Alegre was attending to at the time he met his death that of
ferrying passengers for a fee, was intrinsically private and unofficial in nature proceedings
as it did from no particular directive or permission from his superior officer. In the absence of
such as in the case of Hinoguin and Nitura, or peacekeeping nature of the act attended to
by the policeman at the time he died even without the explicit permission or directive of a
superior officer, as in Alavaran, there is no justification for holding that SPO2 Alegre met the
requisites set forth in the ECC guidelines.
At any rate the 24-hour duty doctrine serves more as an after-the-fact validation of their acts
to place them within the scope of the guidelines rather than a blanket license to benefit them
in all situations that may give rise to their deaths. In other words, the doctrine should not be
sweepingly applied to all acts and circumstances causing the death of the police officer but
only to those which, although not on official line of duty, are nonetheless, basically police
service in character.
The “24-Hour Duty” Doctrine Requires Work-Connection; “Police Service” Activities
Valeriano vs. EEs’ Compensation Commission and GSIS – Petitioner Valeriano was not
able to demonstrate solidly how his job as a firetruck driver was related to the injuries he
has suffered. That he sustained the injuries after pursuing a purely personal and social
function – having dinner with some friends. Because he was neither at his assigned work
place nor in pursuit of the orders of his superiors when he met an accident and more
importantly was not doing an act within his duty and authority as a firetruck driver, or any
Page 27 of 32
other act of such nature, at the time he sustained his injuries. There is not any reasonable
connection between his injuries and his work as a firetruck driver.
INGRESS-EGRESS/PROXIMITY RULE
The general rule in workmen’s compensation law known as “going and coming rule,” simply
stated, is that “in the absences of special circumstances, an EE injured in, going to, or
coming from, his place of work is excluded from the benefits of workmen’s compensation
acts.”
Exceptions:
1. Where the EE is proceeding to or from his work on the premises of his ER
2. Where the EE is about to enter or about to leave the premises of his ER by way of
the exclusive customary means of ingress and egress (Proximity Rule)
3. Where the EE is charged, while on his way to or from his place of EMYPT or at his
home, or during his EMYPT, with some duty or special errand connected with his
EMYPT.
4. Where the ER, as an incident of the EMYPT, provides the means of transportation
to and from the place of EMYPT.
Iloilo Dock & Eng’g. Co. vs. WCC – The point where Pablo was shot was barely twenty
meters away from the main IDECO gate, certainly nearer that a stone’s throw therefrom.
The spot is immediately proximate to the IDECO’s premises. Considering the fact, and
further facts that Pablo has just finished overtime work at the time, and was killed barely two
minutes after dismissal from work and the place was immediately proximate to the place of
work, the accident in question must be deemed to have occurred within the zone of EMYPT
and therefore arose out of and in the course thereof.
Bountiful Brick Company vs. Giles – EMYPT includes not only the actual doing of work, but
reasonable margin of time and space necessary to be used in passing to and from the place
where the work is to be done. If the EE be injured while passing, with the express or implied
consent of the ER, to or from his work by a way over the ER’s premises, or over those of
another in such proximity and relation as to be in practical effect a part of the ER’s
premises, the injury is one arising out and in the course of the EMYPT as much as though it
had happened while the EE was engaged in his work at the place of its performance.
“GOING TO OR COMING FROM WORK” RULE
Resolution No. 3914-A, July 5, 1988 – extending the compensable coverage of off-premises
injury from near the premises up to the residence of the EE. The resolution provides that an
injury or death of a covered member in an accident while he is going to, or coming from, the
workplaces, shall henceforth be duly considered compensable provided the following
conditions are established definitely:
1. The act of the EE of going to, or coming from, the workplace, must have been a
CONTINUING ACT, that is, he had not been diverted therefrom by any other
activity, and he had not departed from his usual route to, or from, his workplace;
and
2. Re: an EE on an special errand, the special errand must have been official and in
connection with his work.
Accident on the Way to Work
Alano vs. ECC – Dedication was a school principal. Her tour of duty was from 7:30am to
5:30pm. While waiting for a ride at a public plaza on her way to school, she was bumped
and run over by a speeding bus which caused her death. The deceased died while going to
her place of work. She was at the place where her job necessarily required her to be if she
was to reach her place of work on time. There was nothing private or personal about her
being at the place of the accident. She was there because her EMYPT required her to be
there.
Accident on the Way Home
Lazo vs. EEs’ Compensation Commission – Here Lazo left his station at the Central Bank
several hours after his regular time off, because the reliever did not arrive, and so he was
asked to go on overtime. After permission to leave was given, he went home. There is no
evidence that eh deviated from his usual, regular homeward route or that interruptions
occurred in the journey. EMYPT includes not only the actual doing of the work, but a
reasonable margin of time and space necessary to be used in the passing, with the express
or implied consent of the ER, to or from his work by a way over the ER’s premises, or over
those of another in such proximity and relation as to be in practical effect a part of the ER’s
premises, the injury is one arising out of and in the course of the EMYPT as much as
though it had happened while the EE was engaged in his work at the place of its
performance.
INJURY AT PLACE OF EMYPT NOT NECESSARY ELEMENT OF COMPENSABILITY
For an injury to be compensable, it is not necessary that the cause therefore shall take
place within the place EMYPT. If a workman is acting within the scope of his EMYPT, his
protection “in the course of” EMYPT usually continues regardless of the place of injury.
The use of streets by the workman merely to get to or from his work
stands on a different footing altogether, but as soon as it is established that the
work itself involves exposure to the perils of the streets, the workman can recover
for any injury so occasioned. The fact that street perils are common to all mankind
is immaterial
In fine, the general rule is that the accident should have occurred at the place of work and
this is known as the “direct premises rule.” Exceptions among others are the “Coming-and-
going rule” and the “Ingress and egress/proximity rule.
INCIDENTS OF EMYPT
It is settled that injuries sustained in connection with acts which are reasonably incidental to
the EMYPT are deemed as arising out of such EMYPT.
1. Acts of personal ministration for the comfort or convenience of the EE
2. Acts for the benefit of the ER
3. Acts done to further the goodwill of the business
4. Slight deviations from work, from curiosity or otherwise
5. Acts in emergency
ACTS OF MINISTRATION
Acts of Ministration are those done by a person for the purpose of satisfying the call of
nature, such as: quenching his thirst, relieving himself by way of urination or excretion etc.
They are deemed to be incidents of EMYPT and necessary to the health of the EE, so that
injuries sustained thereby are compensable.
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Rest or Refreshment
The general rule is that injuries occurring to an EE during an intermission or break for rest or
refreshment arise in the course of the EMYPT and are compensable. Such rule is not
affected by the fact that the EE is paid by the hour and receives no pay for the period
covered by such intermission. Whether an EE, by resting during work hours, departs from,
abandons, or breaks his EMYPT so as to deprive himself of the right to compensation for
any injury sustained while so resting generally depends upon whether such resting, in view
of all the circumstances is reasonable incident to the EMYPT.
Lunch Period
Thus, while generally an accidental injury to an EE is not covered by workmen’s
compensation as being one arising out of and in the course of EMYPT if it occurs OFF the
ER’s PREMISES while the EE is going or coming from lunch on UNPAID TIME, there are
exceptions
Union Meeting
It has been held that an injury received at a union meeting held during a lunch period at the
plant for the purpose of electing a shop steward, the shop steward system being recognized
by the ER in its contract with the union, was not an injury arising out of and in the course of
EMYPT
ACTS FOR THE BENEFIT OF ER
The relation of master and servant is ordinarily suspended during the period that the EE is
off duty and. Therefore, the general rule is that injuries occurring before or after regular
working hours are not within the course of EMYPT. However, an injury sustained by an EE
outside his regular working hours or during a temporary stoppage or cessation of work may,
nevertheless, under some circumstances, be compensable as arising out of and in the
course of the EMYPT, and is generally held to be so where the EE was at the time engaged
in the performance of some service for the benefit of the ER in connection with his usual
duties.
While Doing Work at Home
Injuries sustained by an EE at his own home or upon his own premises, in connection with
the performance of the duties of his EMYPT, are generally held to be compensable where
such work is done there pursuant to the terms of the contract, express or implied, or
pursuant to the direction or request of the ER, but not where it is there performed voluntarily
by the EE for his own convenience or benefit.
ACTS DURING EMERGENCY
According to many authorities the following are injuries arising out of and in the corus of his
EMYPT and entitling the EE to compensation:
1) Outside the scope of his usual duty
a. Which the ER has expressly ordered to do by someone authorized to direct him as
to his work or;
b. Even in the absence of orders when such act is reasonably necessary or incidental
to his regular work, particularly where an emergency existed
c. Even without emergency, direct orders or reasonable necessity, if it was done in
the furtherance of the ER’s business or in pursuance of a habit or custom
EXTRA-PREMISES RULE
a.k.a. Shuttle Bus Rule – Where a company which provides the means of transportation in
going to and coming from the place of work is liable for the injury sustained by EEs while on
board said means of transportation. This is because the company vehicle is an extension of
its premises
SPECIAL ERRAND RULE
An injury sustained by an EE outside the company premises is compensable if his being out
is covered by an office order or a LOCator slip or pass for official business.
WHILE LIVING, BOARDING, OR LODGING ON PREMISES OF ER, OR AT WORKING
PLACE
The mere fact that an EE was living on the ER’s premises at the time of injury does not
ordinary of itself, render such injury compensable as arising out of or in the course of the
EMYPT where such residence on the ER’s premises is merely permissive and not required,
or where the injury results from a risk or danger which is not reasonable incidental to
EMYPT.
WHILE TRAVELING
The right to compensation depends, as in other cases generally, upon whether the injury
results from a risk which is inherent in the nature of the EMYPT, or which is reasonably
incidental thereto, or which the EE is specially exposed, and upon whether the EE, at the
time of the occurrence of the accident, was engaged in the exercise of some functions or
duties reasonably necessary or incidental to the performance if the contract of EMYPT, or, if
not actively engaged, whether he was at the place where he was authorized or required by
such contract to be.
Where EE Uses Own Vehicle Which He Also Uses in Performance of Duties
In some cases in which it appeared that an EE was using his own vehicle at the time he was
injured in an accident while going to or from work, and that he used such vehicle in the
performance of his duties to his ER, it was held that his it was held that such injuries arose
out of and in the course of EMYPT.
Effect of Deviation from Route, Schedule, or Mode of Travel
Non Compensability of Deviation depends upon the Extent, Purpose and Effect Thereof -
An unauthorized deviation may preclude recovery of compensation for an injury caused by
an added peril to which the EE is thereby exposed during the period of the deviation, but the
compensability of an injury occurring after the deviation has ended and the EE is again in
the course of his EMYPT is not ordinarily affected thereby.
Effect of Mingling of Purposes of ER and EE; Dual Purpose
Dual Purpose Doctrine considers as compensable an injury that an EE sustains while on a
trip undertaken for the benefit of the ER even if in the course thereof the EE pursues also a
personal purpose Resolution No. 99-08-0469, August 31, 1999 – the doctrine may be
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applied in the adjudication of EEs compensation claims. The application, however, is
subject to the following guidelines:
The Test in the applicability of the dual purpose doctrine:
The test is that is ordinarily employed for determining liability in such a case is that
if the work of the EE tends to create necessity for travel, he or she is deemed in
the course of EMYPT, albeit the EE serves at the same time some personal
purpose. The requirement is that the services of the ER is at least a concurrent
cause of the trip of the EE
ER-SPONSORED ACTIVITIES
The Test
Whether the recreation was for the EE’s exclusive benefit, or whether the ER had some
interest in the activity. Where an EE is injured while at recreation during a temporary
cessation of work, the injury is compensable as arising out of and in the course of EMYPT
where the recreation indulged was fostered and encourages by the ER to the end of
efficiency of the service.
Recreational Activities fall under the so-called “special engagement rule” which is one of the
exceptions to the “direct premises rule.” This exception covers field trips, intramurals,
outings, and picnics when initiated or sanctioned by the ER. Accidents befalling EEs on
those occasions are compensable. *Considered as an incident of EMYPT
ACTS OF GOD OR FORCE MAJEUR
General Rule: The ER is not responsible for accidents arising from force majeur or an act of
God, when the EE has not been exposed to a greater danger than usual.
Exception: Positional and LOCal Risks, when one in the course of his EMYPT is
reasonably required to be at a particular place at a particular time and there meets an
accident, although one which any other person then and there present would have met
irrespective of his employment, that accident is one “arising out of the EMYPT” of the
person so injured. ER is held liable for compensation because were it not for the order the
EE would not have been at said position or LOCation which exposed him to the said
danger.
In investigating whether or not the death of an EE arose out of his EMYPT, all of the
circumstances present in the case should be taken into consideration in order to be able to
determine whether or not a causal connection exist between his death and the conditions
under which he necessarily had to fulfill his duties. Liberal Interpretation
ASSAULT
Assault although resulting from a deliberate act of the slayer, is considered an “accident”
within the meaning of the Workmen’s Compensation Act, since the word “accident” is
intended to indicate that “the act causing the injury shall be casual or unforeseen, an act for
which the injured party is not legally responsible”
Where the duties of an EE entail his presence (at a place and a time) the claim for an injury
there occurring is not to be barred because it results from a risk common to all
others…unless it is also common to the general public without regard to such conditions,
and independently of place, EMYPT, or pursuit.
Jurisprudence is to the effect that injuries sustained by an EE while in the course of his
EMYPT, as the result of an assault upon his person by another EE, or by a third person, no
question of the injured EE’s own culpability being involved, is compensable where, from the
evidence presented, a rational mind is able to trace the injury to a cause set in motion by
the nature of the EMYPT, or some condition, obligation or incident therein, and not by some
other agency.
When a quarrel had its origin at work, injury from assault committed outside the work
premises is deemed compensable. The SC reasoning that it was merely a continuation or
extension of the quarrel that begun within; that continuity of the case had been so combined
with continuity in time and space “that the quarrel from origin to ending must be taken as
one”
“Increased Risk” Jobs
1. Jobs having to do with keeping the peace or guarding property
2. Jobs having to do with keeping or carrying of money which subject the EE to the
risk of assault because of the increased temptation to robbery
3. Jobs which expose the EE to direct contact with lawless and irresponsible
members of the community, like that of a bartender; and
4. Work as bus driver, taxi driver, or street car conductor.
NPA VICTIMS; PRESUMPTIVE COMPENSABILITY
Quebec vs. GSIS, ECC Case No. 4310, promulgated November 9, 1988: The moment an
AFP member suffers a contingency, the presumption is that it is because of the nature of his
work. This policy is “adopted because of certain serious peace and order problems of the
country, more particularly the insurgency problem, it has become generally perceptible that
on account of the nature of their work, members of the AFP have become “marked men”
insofar as insurgents and other lawless elements are concerned and are, therefore killed by
such insurgents at every opportunity. Same problem is true to the members of the police
force. Police officers are also targets of the insurgents and other lawless elements.
“Presumptive Compensability” Not Applicable
Jahuran vs. GSIS, ECC Case No. 3551, promulgated on March 29, 1989: Presumption
applied in the Quebec case was not applied because said presumption only attaches when
the members of the AFP are killed by insurgents or lawless elements because of the mere
fact that they are soldiers. In the case at bar Jahuran’s heirs were denied compensability
although he was killed by another member of the Philippine Constabulary because evidence
revealed the indeed the incident was brought about by personal conflicts.
EFFECTS OF VIOLATION OF RULES
Acts within the sphere of EMYPT but carried out in violation of some ER-promulgated rules
are compensable.
1. Where the violation of the rule itself did not bring about the cause of the accident
2. Where there is serious doubt that the prohibition was known to the EEs injured.
3. Where the violation was not intentional but due to carelessness or negligence.
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Hawaiian-Philippine CO. vs. WCC: If the injury or death was the result of horseplay or
larking among EEs, the courts have declared the same as a compensable accident. There
can be no question that horseplay or larking is unfortunately too common in factory life.
WHEN NOT COMPENSABLE
Although violation of company rules does not necessarily defeat compensability it will be a
different matter, however, if the injury results from intoxication whether or not the company
rule is violated. It will be seen under Art. 172 that the disability or death is not compensable
if it is caused by the EE’s intoxication, willful intention to injure or kill himself or another,
notorious negligence, or otherwise excluded from coverage of law.
SICKNESS, DEFINED; OCCUPATIONAL OR COMPENSABLE DISEASE
Sickness any illness definitely accepted as an occupational disease listed by the
Commission, or any illness caused by EMYPT subject to proof by the EE that the risk of
contracting the same is increased by working conditions. For this purpose, the Commission
is empowered to determine and approve occupational diseases and work-related illnesses
that may be considered compensable based on peculiar hazards of EMYPT. (Occupational
diseases found in ECC Rules, appended to the book. Book IV)
Occupational Disease
Menez vs. EE’s Compensation Commission, et. al: “Nature” means conditions to which all
EEs of
a class are subject and which produce the disease as a natural incident of a particular
occupation, and attach to that occupation a hazard which distinguishes it from the usual run
of the occupation and is in excess of the hazard attending the EMYPT in general.
To be an occupational disease it must be one due wholly to causes and conditions which
are normal and constantly present and characteristic of the particular occupation; that is,
those things which science and industry have not yet learned how to eliminate. Every
worker in every plant of the same industry alike constantly exposed to the danger of
contracting a particular occupational disease.
Duties of ER Regarding Occupational Disease
Under Rule III, Sec. 2 of the Amended ECC Rules, the ER is bound to require preEMYPT
examination of EEs exposed to occupational diseases.
THEORY OF INCREASED RISK
Increased Risk Theory – to establish compensability, the claimant must show proof of
reasonable work-connection, not necessarily direct causal relation. The degree of proof
required is merely substantial evidence which means such relevant evidence as will support
a decision, or clear and convincing evidence. Although strict rules of evidence are not
applicable, yet the basic rules that mere allegations is not evidence cannot be disregarded.
Illustrative Case: Increased Risk Shown
Clemente vs. GSIS: Working as a cleaner in a skin clinic whereas the deceased was
exposed to different carriers of viral and bacterial diseases.
Narazo vs. ECC: (Uremia) Deceased was a Budget Examiner. From human experience,
prolonged sitting down and putting off urination result in stagnation of urine. This
encourages the growth of bacteria in the urine, and affects the delicate balance between
bacterial multiplication rates and the host defense mechanisms. Delayed excretion may
permit the retention and survival of microorganisms which multiply rapidly, and infect the
urinary tract.
Illustrative Case: Increased Risk Not Shown
Quantum of Evidence: to prove the cause of the ailment or the increased risk from the job
“can obviously be determined only on a case-to-case basis”
Limbo vs. ECC: Absence of the sickness from the list of Occupational Diseases is not a bar
to petitioner to claim so long as he can probe that the risk of contracting the illness was
increased by his working conditions. In determining whether a disease is compensable, it is
enough that there exists a reasonable work connection as the workmen’s claim is based on
probability and not on certainty.
Dabatian vs. GSIS: Aside from the undisputed fact that deceased was a heavy coffee
drinker, which was his way of warding off sleepiness; no evidence was ever adduced by
claimant to bolster the theory that her husband’s work increased the risk of contracting the
ailment. The Supreme Court takes notice of the fact that the conditions in this case are not
peculiar to the work mentioned therein. Many, if not most, EEs are equally exposed to
similar conditions but have not been victims of peptic ulcer.
Sarmiento vs. ECC: Parotid carcinoma or cancer of the salivary glands is not an
occupational disease considering the deceased’s EMYPT as accounting clerk and later as
manager of the budget division. The petitioner must, therefore, prove that his wife’s ailment
was caused by her EMYPT or that her working conditions increased the risk of her
contracting fatal illness. The evidence presented by petitioner that her field trips
necessitated her to take frequent plane travels which caused deafening and numb
sensation in the ears were held by the court as mere conjectures and not sufficient to grant
her relief.
EVIDENCE; DEGREE OF PROOF
Proof of direct causal relation is not, however, indispensably required. It is enough that the
claimant adduces proof of reasonable work connection, whereby the development of the
disease was brought about largely by the conditions present in the nature of the job. Strict
rules of evidence are not demanded. The degree of proof required is merely substantial
evidence, which has been held to be such relevant evidence as a reasonable mind might
accept as sufficient to support a conclusion.
Under the law, it is not required that the EMYPT be the sole factor in the growth
development or acceleration of claimant’s illness to entitle him to the benefits provided for. It
is enough that his EMYPT had contributed even in a small degree.
NEW DOSCTRINE; PROOF IS REQUIRED
Raro vs. ECC: It is not correct to say that all cancers are not compensable. The list of
occupational diseases prepared by the ECC includes some cancers as compensable.
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Cancer is still a disease of still unknown origin which strikes people in all walks of life,
employed or unemployed. Unless it be shown that a particular form of cancer is caused by
specific working conditions. The court cannot conclude that it was the EMYPT which
increased the risk of contracting the disease.
Orate vs. CA: It is well to remember that if diseases not intended by the law to be
compensated are inadvertently or recklessly included, the integrity of the State Insurance
Fund is endangered. Compassion for the victims of diseases not covered by the law ignores
the need to show a greater concern for the trust fund to which the tens of millions of workers
and their families look to for compensation whenever covered accidents, diseases and
death occur. This stems from the development in law that no longer is the poor EE still
arrayed against the might and power of his rich corporate ER, hence the necessity of
affording all kinds of favorable presumptions to the EE. This reasoning is no longer good
policy. It is now the trust fund and not the ER which suffers if benefits are paid to claimants
who are not entitled under the law.
CHAPTER III
ADMINISTRATION
1. STRUCTURE AND FUNCTIONS
CHAIRMAN of the EEs’ Compensation Commission: Secretary of Labor and EMYPT
FOUR EX-OFFICIO MEMBERS:
a. SSS Administrator;
b. President and General Manager
c. ECC Executive Director
d. Medicare Chairman
TWO APPOINTIVE MEMBERS:
a. one representing the ERs (for a term of 6 yrs. each)
b. another representing the EEs
3. Curative Thrust - The ECC is also responsible for the treatment of sickness or injury that
a worker may suffer in line of duty as well as rehabilitation of those who are disabled.
Note: For medical services, the ECC conduct accreditation of qualified physicians, clinics
and hospitals where EC patients may be referred to for admission and treatment.
REHABILITATION SERVICES consist of
a. medical treatment;
b. surgical treatment; or
c. hospital treatment, including appliance.
TWO SEPARATE FUNDS
The ECC may not augment the SIF in the GSIS with funds from the SIF in the SSS because
these are two separate funds.
CHAPTER VI
DISABILITY BENEFITS
1. DISABILITY
Disability – does not refer to the injury nor to the pain and suffering it has occasioned but it
refers to the loss or impairment of earning capacity
- there is disability when there is a loss or diminution of earning power because of actual
absence from work due to the injury or illness arising out of and in the course of EMYPT.
- The basis of compensation is reduction of earning power
- As long as the EE goes on working (even if he suffers service-connected injury or illness)
without any reduction whatsoever in his earning capacity, there is no disability and ,
therefore, he is not entitled to any income benefit.
Art. 167 (n) – defines ‘disability’ as loss or impairment of a physical or mental function
resulting from injury or sickness.

ECC – the policy-making body of the EEs’ Compensation Program and also the appeal CATEGORIES OF DISABILITY
body. (Decisions of SSS or GSIS, if unfavorable to the claimant, are appealable to the 3 Distinct Categories of of EE’s Disability:
ECC). 1. temporary total disability
2. permanent total disability
THREE THRUSTS OR COMPONENTS OF THE ECC PRGRAM: 3. permanent partial disability
1. Preventive Thrust - to minimize and control hazards in the working environment.
Two agencies involved in this program: TOTAL DISABILITY - may either be:
a. Bureau of Working Conditions (BWC) - inspects work premises a. permanent
b. Occupational Safety and Health Center (OSHC) - trains safety engineers, tests b. temporary
safety equipment and undertakes research work and that the law provides that - does not mean a state of absolute helplessness
establishments having high rate of incidents caused by hazards of their working - means disablement of an EE to earn wages in the same kind of work, or a work of similar
environment will be liable to 25% of benefits due the claimants. (To force the nature, that he was trained for or accustomed to perform, or any kind of work which a
observance of the legal requirement on occupational health and safety.) person of his mentality and attainment could do.

2. Compensative Thrust - is the heart of the EEs’ Compensation Program; through the
SSS and GSIS, the ECC pays benefits to government and private Sector workers who
suffer work-oriented contingencies; in case of death, the benefits are given to the
beneficiaries.
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