-Republic ofthe Philippines

President Ramon Magsaysay State University

Masinloc Campus
Masinloc, Zambales

College/Department COLLEGE OF ACCOUNTANCY AND BUSINESS

ADMINISTRATION
Course Code BA – HRDM 6
Course Title Labor Law and Legislation
Place Of The Course In The
Program Major
Semester & Academic Year FIRST SEMESTER, AY 2020-2021
Instructor ROSALIE M. ALMARIO

MODULE NO. _1

INTRODUCTION
Introduction to the basic concepts related to the labor, particularly with labor
standards and labor relations.

INTENDED LEARNING OUTCOMES (CILO)

You will be able to:
To familiarize students with the nature, source, function, effects and
applications of labor laws.
To introduce the concept and underpinnings of labor standards, labor
relations and social legislation.

DISCUSSION

Chapter 1
THE CONSTITUTION AND PROTECTION TO LABOR LAW

Labor- exertion by human beings of physical or mental efforts or both, towards the
production of goods and services.
 Labor also means that sector or group in a society, which derives its livelihood
chiefly from rendition of work or services in exchange for compensation under
management direction.

BASIC RIGHTS OF WORKERS AS GUARANTEED BY THE CONSTITUTION

1. Under Labor Standards
1.1 Right security of tenure
1.2 Right to receive a living wage.
1.3 Right to share in the fruits for production, and
1.4 Right to work under humane conditions

UNDER LABOR RELATION

1. Right to organize themselves;
2. Right to conduct collective bargaining or negotiation with management;
3. Right to engage in peaceful concerted activities including strike; and
4. Right to participate in policy and decision-making processes.

CONSTITUTIONAL MANDATES
1. Art XII. Sec 3
The state shall afford full protection to labor, local and overseas, organized
and unorganized and promote full employment and equality of employment
opportunities to all.
 It shall guarantee the rights of all workers to self-organization, collective
bargaining and negotiations and peaceful concerted activities, including the right to
strike in accordance with the law. They shall be entitled to security to tenure,
humane conditions of work, and living wage. They shall also participate in policy
and decision making process affecting their rights and benefits as may be provided
by the law.
The state shall promote the principle of shared responsibility between
workers and employers and the preferential use of voluntary modes in settling
disputes, including conciliation and shall enforce their mutual compliance therewith
to foster industrial peace.
The state shall regulate the relations between the workers and employers,
recognizing the right of labor to its just share in fruits of production and the right of
enterprises to reasonable returns of investment and to explain and growth.

2. Art II. Sec. 9

The sate shall promote a just and dynamic social order that will ensure the
prosperity and independence of the nation and free the people from poverty
through policies that provide adequate social services, promote full employment a
rising standard of living and improved quality of life for all.
3. Art II. Sec 18
The state affirms labor as primary social economic force. It shall protect the
rights of workers and promote welfare.

4. Art. III, Sec. 8

The right of the people, including those employed in the public and private
sectors, to from unions, associations, or societies for purposes not contrary
to law, shall not be abridged.

5. Art. III, Sec. 18 (2)

No involuntary servitude in any form shall exist except as punishment for a
crime whereof the party shall have been duly convicted.

6. Art. XII, Sec. 12

The state shall promote the preferential use of Filipino labor, domestic
materials and locally produced goods and adopt measures that help make them
competitive.

7. Art. XIII, Sec. 14

The state shall protect working women by providing safe and healthful
working conditions, taking into account their maternal functions and such facilities
and opportunities that will enhance their welfare and enable them to realize their
full potential in the service of the nation.

8. Art. XVI, Sec. 8

The state shall from time to time, review to upgrade the pensions and other
benefits due to retirees of both the government and private sectors.

SOCIAL JUSTICE AS THE AIM

Social justice is neither communism nor despotism nor atomism nor anarchy, but
the humanization of laws and the equalization of social and economic forces by the State so
that the justice in its rational and objectively secular conception may at least be
approximated. Social justice means the promotion of welfare of all people, the adoption y
the government of measures calculated to ensure economic stability of all the component
elements of the society through the adaptation of measure legally justifiable, or extra –
constitutionally, through the exercise of powers underlying the existence of all
governments on the time-honored principle of salus populis suprema lex (Calalang v.
Williams, No 47800, December 2, 1940).
WORKER

Any member of labor force, whether employed or unemployed

RECRUITMENT AND PLACEMENT

Any act of canvassing, enlisting, transporting, contracting, hiring utilizing or

procuring workers, and includes contract services, referrals, advertising or promising for
employment, locally or abroad, whether for profit or not. Provided, that any person or
entity which, in any manner, offers or promises for a fee employment to two or more
persons shall be deemed engaged in recruitment and placement.

APPRENTICESHIP

Practical training on the job supplemented by the related theoretical instruction, for
a highly skilled or technical occupation for a period of not less than three (3) months but
not more than six (6) months.

APPRENTICE

A worker who is by a written apprenticeship agreement with an individual

employer or any of the entities recognized under this chapter, which an apprenticeship
program duly approved by the DOLE.

APPRENTICEABLE OCCUPATION

Any trade, form of employment or occupation which requires more than 3 months
of practical training on the job supplemented by related theoretical instruction.

APPRENTICESHIP AGREEMENT

An employment contract wherein the employer binds himself to train the

apprenticeship and the apprentice in turn accepts the terms training.

ON-THE-JOB TRAINING

Practical work of experience through actual participation in productive activities

given to or acquired by an apprentice.

HIGHLY TECHNICAL INDUSTRIES

A trade, business, enterprise, industry or other activity, which is engaged in the

application of advanced technology.

QUALIFICATIONS OF APPRENTICES

1. At least 15 years of aged (as amended by R.A. 7610), provided that if below 18 years,
he shall not be eligible for hazardous occupation.
2. Possess vocational aptitude and capacity for appropriate test,
3. Possess the ability to comprehend and follow oral and written instructions; and
4. The company must have apprenticeship program duly approved by the DOLE.

LEARNERS

Persons hire as trainee in semi-skilled and other industrial occupation which are
not-apprenticeable and which may be learned through the practice training on the job in a
relatively short period of time which shall not exceed 3 months.
WHEN LEARNERS MAY BE HIRED

1. No experienced workers are available.

2. The employment of learners being necessary to prevent curtailment of employment
opportunities; and
3. The employment may neither create unfair competition in terms of labor costs nor
impair working standards.
Chapter 2

WORKING CONDITIONS AND REST PERIOD

BENEFITS GRANTED IN TITLE I BOOK III

1. Right to regular working hours

2. Right to regular working days
3. Right to overtime work
4. Right to regular meal period
5. Right to night shift differential pay
6. Right to weekly rest periods

EMPLOYER
One who employs the services of others or who acts or and in behalf of an employer,
one for whom employees work and who pays their wages or salaries.

EMPLOYEE
On who works for an employer for a fee, a person working for salary or wages.

ELEMENTS OF EMPLOYER-EMPLOYEE RELATIONSHIP OR FOUR FOLD TEST

1. Selection and engagement of the employee;

2. Payment of wages;
3. Power of dismissal; and
4. Power to control.

CONTROL TEST
Refers to the employer’s power to control or right to control the employee not only
as to the result of the work to be done but also to means and methods by which the same is
to accomplished.
The control test is the most important test our courts apply in distinguishing an
employee from an independent contractor. This test is based on the extent of control the
hirer exercises over a worker. The greater the supervision and control the hirer the
exercise, the more likely the worker is deemed an employee. The converse holds true as
well-the less control the hirer exercises the more likely the worker is considered an
independent contractor (Sonza v. ABS-CBN Corp. Gr No. 138051, June 10, 2004).

CASES WHERE EMPLOYER-EMPLOYEE RELATIONSHIP EXISTS

1. Jeepney driver on boundary bases;
2. Drivers or helpers of salesmen are employee of the company;
3. Employees of unregistered association;
4. Street-hired cargadores;
5. Workers in movie projects;
6. Salaried insurance agent as distinguished from registered agents on commission
basis;
7. Tailors, seamstresses, servers, basters, plantsadoras paid on piece-rate basis;
8. In-house lawyer;
9. University professors and instructions; and
10. Taxi driver, barber.

CASES WHERE THERE IS NO EMPLOYER-EMPLOYEE RELATIONSHIP

1. Farm workers are not employees of the sugar central;
2. Working scholars are not employees of the schools;
3. Company vs collecting agents on commission basis;
4. Shoe shine boys; and
5. Soft drinks company vs. Independent contracting selling soft drinks.

NORMAL HOURS OF WORK

The normal hours of works of an employee shall not exceed 8 hours a day.
PART-TIME WORK
8-hour labor law prescribes the maximum but not the minimum. Therefore, part-
time work, or days’ work of less than 8 hours is not prohibited.

COMPRESSED WORK WEE (CWW)

CWW is resorted by the employer to prevent serious losses due to cases beyond his
control, such as when there is substantial slump in demand for his goods or services or
when there is lack of raw materials. To be an exception to the “eight-hour a day”
requirement, the worker must agree to the temporary change of work schedule and they do
not suffer any loss of overtime pay, fringe benefits or their weekly monthly take-home pay.

This scheme is an alternative arrangement whereby the normal workweek is

reduced to less than 6 days but the total number of normal hours per week remains at 48
hours, the normal workday is increased to more than 8 hours without corresponding
overtime premium. This applies as well to 40 or 44-hour workweek firms.

CONDITONS OF A VALID CWW SCHEME

1. It is expressly and voluntarily supported by majority of the employees
affected.
2. If work is hazardous, a certification is needed from an accredited safety
organization or the firm’s safety committee that work beyond 8 hours is
within the limits or levels of exposure set by DOLE’s occupational safety and
health standards.
3. The DOLE is duly notified.

NORMAL HOURS OF WORK OF HEALTH PERSONNEL

For health personnel in cities and municipalities with a population of at least 1M or

in hospitals and clinics with a bed capacity of at least 100;

1. Regular office hours shall be 8 hours a day for 5 days a week, or 40 hours a week,
exclusive of time for meals.
2. In case of exigencies, they may work for 6 days or for 48 hours, but they shall be
entitled to an additional compensation of at least 30% of their regular wage for
work performed on the 6th day.

WORK DAY vs. CALENDAR DAY

WORK DAY

24 hours’ period commencing from the time an employee regularly starts to work
regardless of whether the work is broken or continuous. It may not coincide with calendar
day.

CALENDAR DAY

24-hour period commencing at 12 midnights and ending at 11:59 pm. It is possible

for an employee to work for 2 calendar days (e.g. if X’s work schedule is from 10 pm of
Monday up to 6 am of Tuesday, his work day cover 2 calendar days).

HOURS WORKED

HOURS WORK INCLUDE

1. All time during which an employee is required to be on duty or to be at presented

workplace.
2. All time during which an employee is suffered or permitted to work;
 3. Rest periods of less than twenty (20) minutes are only a rest period of short
duration and are thus considered as hours worked.

RULES OF HOURS OF WORK

A. WAITING TIME
Considered as hours if waiting:
1. Is an integral part of his work;
2. The employee is required or engaged by the employer to wait; or
 When employee is required to remain on call in the employer’s premises or so close
thereto that he cannot use the time effectively and gainfully for his own purpose.

ENGAGED TO WAIT vs. WAITING TO BE ENGAGED

ENGAGED TO WAIT (employee is required Waiting to be engaged (employee is not
to wait) required to wait )

waiting is an integral part of the job, the Idle time is not working time, it is not
time spent waiting is compensable compensable

B. WORKING WHILE ON CALL

When employee is required to remain on call in the employer’s premises or so close

thereto that he cannot use the time effectively and gainfully for his own purpose.

However, if he is not required to leave word at his home or with company officials
where he may be reached, he is not considered working while on call.

C. TRAVEL TIME
Travel from Home to Travel that is all in days’ Travel away from home
work work
Normal travel from home to the time spent by an travel that keeps an
employee in employee away

Work which is not work Travel as part of his From home overnight
time principal activity, like travel
from jobsite to jobsite
during the work day

Not compensable because it Compensable and must be Considered as work time

is a normal incident of counted as hours worked when it cut across an
employment employee’s workday
because it substitutes for
the hours that the employee
should have been in the
office
 D. POWER INTERRUPTIONS
1. 1st 20 minutes is compensable.
2. Succeeding minutes not compensable
3. If despite the laps of the 1 st 20 minutes the employees are required to stay in
their workplaces, such as time is compensable.

E. SEMESTRAL BREAK OF TEACHERS

Compensable hours worked for. It is a form of interruption beyond their
control.

F. LECTURES AND MEETINGS, TRAININGS, PROGRAMS

not control as working time if all the following conditions are met.
1. Attendance is outside of employee’s regular working hours,
2. Attendance is in fact voluntary; and
3. Employee does not perform any productive work during such attendance.

MEAL PERIODS
1. Should not be less than sixty (60) minutes. It is non-compensable except
when employee is required to work while eating.
2. May be less than sixty (60) minutes but should not be less than twenty
(20) minutes and the shortened mealtime must be with full pay, under
the following instances:
a. Where the work is no-manual m=work in nature or does not involve
strenuous physical exertion;
b. Where the establishment regularly operates not less than 16 hours a
day;
c. In cases of actual or impending emergencies or there is urgent work
to able to performed on machineries, equipment or installation to
avoid serious loss which the employer would otherwise suffer;
d. Where the work is necessary to prevent serious loss of perishable
goods
3. If less than twenty (20) minutes, it becomes only a rest period and is thus
considered as work time.

NIGHT SHIFT DEFFERENTIAL

Additional compensation of not less than 10% of an employee’s regular wage for
every hour of work done between 10:00 pm and 6:00 am, whether or not such period is
part of the worker’s regular shift.

FORMULA FOR THE COMPUTATION OF SLARY WITH NSD

1. Without overtime
[(10% regular wage per hour) x no. Of hours’ work performed between 10pm-
6am)]
2. With overtime
[(10% of OT wage per hour) x no. Of hours of work performed between 10pm-
6am)]
OVERTIME PAY

Additional compensation for work performed beyond eight (8) hours within the
worker’s 24 hour workday regardless whether the work covers 2 calendar days.

FORMULA FOR THE COMPUTATION OF SALARY WITH OVERTIME PAY

1. Regular workdays
[(regular basic wage + 25% of regular basic wage)
[(25% x wage per hour) + wage per hour) no. Of OT hours)]
2. Legal or regular holidays
[(holiday wage rate + 30% of holiday rate (200%)]
[(30% x wage per hour) + wage per hour] x no. Of OT hours
 3. Rest days or special holidays
[(rest day or special holiday wage rate + 30% of rest day or special holidays wage
rate (130%)]
[30 % x Wage per hour) +Wage per hour] x no. Of OT hours
4. Scheduled rest day which is also a legal or regular holiday
[(rest day &legal holiday wage rate + 30% of rest day & legal holiday wage rate
(260%)]
[(30% x Wage per hour) + Wage per hour] x no. Of OT hours
5. Double holiday
[double holiday wage rate + 30% of double holiday wage rate (300%)]
[(30% x Wage per hour) +Wage per hour] x no. Of OT hours

REGULAR WAGE

Regular wage shall include cash wage only; without deduction on account of
facilities provided by the employer, for purposes of computing OT and other additional
remunerations.

COMPENSATION FOR REST DAY, SUNDAY OR HOLIDAY WORK

PREMIUM PAY OR DIFFERENTIAL COMPENSATION

Additional compensation for work rendered by the employee on days when

normally he should not be working such as special holidays and weekly rest days.

FORMULAS TO COMPUTE WAGES ON HOLIDAYS

1. for regular holidays, the following rules shall apply:

a. If it is an employee’s regular workday
 If unworked --------100&
 If worked
o 1st 8 hours ----- 200%
o Excess of 8 hours ----plus 30% of hourly rate on said day
b. If it is an employee’s rest day
 If worked -------100%
 If worked
o 1st 8 hours --------plus 30% of 100%
o Excess of 8 hours – plus 30% of hourly rate on said day
2. For declared special days such as Special Non-Working Day, Special Public Holiday,
Special National Holiday and nationwide special das the following rules shall apply:
a. If unworked no pay, unless there is a favorable company policy practice or
collective bargaining agreement (CBA) granting payment of wages on special
days’ even if unworked.
b. If worked
 1st 8 hours-plus 30% of daily rate of 100%
 Excess of 8 hour-plus 50% of the daily rate on said day
3. For those declared as special working holidays, the following rules shall apply:
For work performed, an employee is entitled only to is basic rate. No
premium pay is required since work performed on said days is considered
work on ordinary working days

LIST OF SPECIAL DAYS

1. All Saints Day – November 1

2. Last day of the year – December 31
3. Ninoy Aquino day- Monday nearest august 21
4. Other days declared by law
HOLIDAY PAY
A day’s pay given by law to an employee even if he does not work on a regular
holiday. It is limited to the eleven (11) regular, also called legal, holidays listed by law. The
employee should have not been absent without pay on the working day preceding the
regular holiday.

LIST OF REGULAR HOLIDAYS

1. New Year’s Day – January 1
2. Maundy Thursday – movable date
3. Good Friday – movable date
4. Araw ng Kagitingan – Monday nearest April 9
5. Labor day – Monday nearest may 1
6. Independence day – Monday nearest June 12
7. National Heroes Day – last Monday of august
8. Bonifacio day – Monday nearest November 30
9. Christmas day – December 25
10. Rizal’s day – Monday nearest December 30
11. Eid’ Fitr – movable date
12. Eid’l Adha

DOUBLE HOLIDAY PAY

(i.e. Araw ng Kagitingan and Good Friday falls on same day )
1. 200% of the basic wage
a. Entitled even if said day is unworked
b. To give employee only 100% would reduce the number of holidays under D.O
no. 3
2. 300% if he worked on 2 regular holidays falling on the same day
3. 390% of the basic wage if he worked on2 regular holidays falling on the same
day and at the same time, falling on scheduled rest day.

LEAVE PAY

CONCEPT OF SERVICE INCENTIVE LEAVE (SIL)

Five (5) days leave with pay for every employee who has rendered at least one year
of service.

ONE (1) YEAR OF SERVICE

Service within 12 months, whether continuous or broken, reckoned from date the
employee started working including authorized absences and paid regular holidays unless
the number of working days in the establishment, as a matter of practice or policy or as
provided in the employment contract, is less than 12 months.

SIL DOES NOT APPLY TO THE FOLLOWING

1. Already enjoying the said benefits
2. Already enjoying vacation leave with pay for at least 5 days;
3. Employed in establishment regularly employing less than 10 employees; and
4. Employed in an establishment exempted from granting this benefits by the
secretary of labor

VACATION AND SICK LEAVE

Not statutorily required, matter of management discretion or a product of collective
bargaining agreement.

PARENTAL (SOLO) LAEVE

Not more than seven (7) days every year is granted to ay solo parent employee who
has rendered service of at least one (1) year.
 No employer shall discriminate against any solo parent employee with
respect to terms and conditions of employment on account on his/her status.
A change in the states of circumstance of the parent claiming benefits under
this Act, such that he/she is no longer left alone with the responsibility of parenthood shall
terminate his/her eligibility fir these benefits.

BATTERED WOMEN LEAVE

A female employee who is a victim of violence is entitled to a paid leave of ten days
in addition to other paid leaves. The leave is extendible when the necessity arises. The
employee has to submit a certification from the Punong barangay, kagawad, prosecutor or
clerk of court that an action R. A. No. 9262 has been filed and pending.

SERVICE CHARGES

All service charges collected by the hotels, restaurants and similar establishment
shall be distributed as follows:
1. 85% for all covered employees to be equally distributed among them
2. 15% for disposition by management to answer for losses and breakages and
distribution to employees receiving more than P2000.00 a month at the discretion
of the management in the latter case.

CHAPTER TEST
Answer the following:

1. a) an exclusive school for girls, run by a religious order, has a policy of not
employing unwed mothers, women with the live-in partners and lesbian. Is the
policy violative of any provision of Labor Code on employment of women?

b) the same school dismissed two female faculty members on account of pregnancy
out of wedlock. Did the school violate any provision of the Labor Code on
employment of women?

2. A lady worker was born with a physical deformity, specially, hard of hearing, speech
impaired, and color blind. However, these deficiencies do not impair her working
ability. Can the employer classify the lady worker as a handicapped worker so that
her daily wage will only be seventy-five percent (75%) of the applicable daily
minimum wage?

3. A Personnel Manager, while interviewing an attractive female applicant for

employment, starred directly at her for prolonged periods, albeit in a friendly
manner. After the interview, the manager accompanied the applicant to the door,
shook her hand and patted her on the shoulder. He also asked the applicant if he
could invite her for dinner and dancing at some future time. Did the Personnel
Manager, by the above acts, commit sexual harassment? Reason.

4. Miss Abby Aryan is a well-known radio-tv host. She signed contact with XYZ
Entertainment Network to host a one hour daily talk show where she interviews
various celebrities on topical subjects that she herself selects. She was paid monthly
remuneration of P300,000.00. the program had been airing for almost two years
when sponsor advertising revenues dwindled, constraining the network to cancel
the show upon the expiration of its latest contract with Ms. Aryan. The talk show
protested the discontinuance of her monthly talent fee, claiming that was
tantamount to her illegal dismissal from the network since she has already attained
the status of regular employee. Is Ms., Aryan correct?

5. During the open forum following your lecture before members of the various unions
affiliated with a labor federation, you were asked the following questions (state your
answers and reasons therefore)
a. Araw ng Kagitingan and Good Friday among the 10 paid regular holidays under
Article 94 of the Labor Code. How much will an employee receive when both
holidays fall on the same day?
CHAPTER 3
WAGES

WAGE vs. SALARY

WAGE SALARY
Compensation for skilled ot unskilled Paid to white collar workers and denote a
manual labor higher grade of employment
Under Article 1708 of the Civil Code, it is it is not exempt from execution,
not subject to execution, garnishment or garnishment or attachment.
attachment except for debts related to
food, clothing shelter and medicines

MINIMUM WAGE

Lowest base wage rate fixed by law that an employer can pay his employees.

13TH MONTH PAY

Additional income based on wage required by PD 851 which is equivalent to 1/12 of

the total basic salary earned by an employee within a calendar year.

May be given anytime but not later than December 24.

A statutory obligation, granted to covered employees, hence, demandable as a

matter of right.

PRODUCTIVITY INCENTIVES
1. Kind of bonus that comes from productivity gain;
2. Aims to institute productivity at company level and the sharing of productivity gain
between employer s and employees; and
3. Nature of salary bonus is proportionate to increase in current productivity.

WORKERS PAID ON PIECE-RATE BASIS

Those who are paid a standard amount of every piece or unit of work produced that
is more or less regularly replicated, without regard to the time spent in producing the
same.

CATEGORIES OF PIECE-RATE WORKERS

A. As to presence of control
1. Piece-rate worker
Works directly under the supervision of their employer.
2. Pakiaw or Takay
Works away the employers work premises and are not directly supervised by
the employer
B. As to Rate of Payment
1. Those paid in piece rates as prescribed in Piece Rate Orders by the DOLE
2. Those paid output rates which are prescribed by the employer and a not yet
approved by the DOLE.

BENEFITS PAYABLE TO PIECE-RATE WORKERS WHOSE WORK IS DIRECTLY

SUPERVISED BY THE EM PLOYER

1. Applicable statutory minimum daily rate;

2. Yearly service incentive leave of five days with pay,
3. Night shift differential pay;
4. Holiday pay;
 5. Meal and rest period;
6. Overtime pay (conditional);
7. Premium Pay (conditional)
8. 13th month pay; and
9. Other benefits granted by law, individual or collective bargaining agreements or
company policy or practice

FORMS OF PAYMENT

Employer cannot pay his workers by means of:

1. Promissory notes;
2. Vouchers;
3. Coupons;
4. Tokens;
5. Tickets;
6. Chits; or
7. Any object other than legal tender

TIME OF PAYMENT

o At least once every two weeks; or

o Twice a month at intervals not exceeding 16 days.

PLACE OF PAYMENT
at or near the place undertaking

TYPES OF CONTRACTORS UNDER THE LAW

1. Job contracting or Subcontracting

An arrangement whereby a principal agrees to put out farm out with a contractor or
subcontractor the performance or completion of a specific job, work service within a
definite or predetermined period, regardless of whether such job, work or service is
to be performed or completed within or outside the premises of the principal.

ELEMENTS OF INDEPENDENT CONTRACTOR /JOB CONTRACTING

a. The contactor or subcontractor carries on a distinct and independent business and

undertakes to perform the jo on his own account and under his responsibility
according to its manner and method and free from the control and direction of the
principal in all matters connected with the performance of the work except as to the
results thereof;

b. The contractor or subcontractor has substantial capital or investment in tools,

equipment and machineries, work premises and other materials necessary in the
conduct of is business;

c. The agreement between the principal and contractor or subcontractor assures the
contractual employees entitlement to all labor and occupational safety and health
standards, free exercise of the right to self-organization, security of tenure and
social and welfare benefits;

d. Must be properly registered as such in accordance with D. O. No. 1802.

2. Labor-only Contracting
 An arrangement where the contractor or subcontractor merely recruits, supplies or
places workers to perform a job, work or service for a principal and any of the
following elements is present.

a. The contractor or subcontractor does not have a substantial capital or

investment which relates to the job, work or service to be performed and the
employees recruited, supplied or place by such contractor in subcontractor are
performing activities which are directly related to the main business of the
principal; and

b. The contractor does not exercise the right to control over the performance of the
work pf the contractual employee.

UNFAIR LABOR PRACTICES

NATURE OF UNFAIR LABOR PRACTICE

1. Criminal offenses against the state;

2. Violations of civil rights of both labor and management;
3. Violate the constitutional right of the workers and employees to self- organization;
4. Are inimical to the legitimate interest of both labor and management, including their
right to bargain collectively and otherwise deal with each other in an atmosphere of
freedom and mutual respect;
5. Disrupt industrial peace; and
6. Hinder the promotion and healthy and stable labor-management relations and
mutual respect unstable labor-management relations).

ELEMENTS OF UNFAIR LABOR PRACTICE

1. Employer-employee relationship between the offender and the offended; and
2. Act done is expressly defined in the code as an act of unfair labor practice.

UNFAIR LABOR PRACTICES OF EMPLOYERS

1. INTERFERENCE

To interfere with, restrain or coerce employees in the exercise of their right to self-
organization.

TEST: Whether the employer has engaged in conduct which, it may reasonably be
said, tends to interfere with the free exercise of the employees right and it is not necessary
that there be direct evidence that any employee was in fact intimidated or coerced by the
statements of threats or the employer of there is reasonable interference that the anti-
union conduct of the employer does have an adverse effect of self-organization and
collective bargaining.

TOTALITY OF CONDUCT DOCTRINE

The culpability of employer’s remarks is to be evaluated not only on the basis of
their implications, but against the background of and in conjunction with collateral
circumstances.

EXAMPLES:
1. Outright and unconcealed intimidation;
2. In order that interrogated would not be deemed coercive;
a. The employer must communicate to the employee the purpose questioning
b. Assure him that reprisal would take place
c. Obtain employee participation voluntarily
3. Must be free from employer hostility to union organization;
4. Must not be coercive in nature;
5. Intimidating expressions of opinion by employer.
 2. YELLOW DOG CONDITION
To require as a condition for employment that a person or an employee shall not
join a labor organization or shall withdraw from one to which he belongs.

Yellow Dog Contract

a promise exacted from workers as a condition of employment that they are not
belong to, or attempt to foster, a union during their period of employment. It is null and
void because:
1. It is contrary to public policy for its tantamount on involuntary servitude.
2. It is entered into without consideration for employees in waiving their right to
self-organization.
3. Employees are coerced to sign contracts disadvantageous to their family.

3. CONTRACTING OUT
To contract out services or functions being performed by union members when such
will interfere with, restrain or coerce employees on the exercise of their right to self-
organization

RUNAWAY SHOP
An industrial plant moves by the owners from one location to another to escape
labor regulations or state laws or to discriminate against employees at the old plant
because of their union activities.

4. COMPANY DOMINATIONS OF UNION

To initiate, dominate, assist or otherwise interfere with the formation or administration of
any labor organization, including the giving of financial or other support to its organizers
or officers.

COMPANY UNIONS/CAPTIVE UNIONISM

Considered as a ULP because the officers will be beholden to the employees and
they will not look after the interest of whom they represent.

INITIATION OF THE COMPANY UNION IDEA BY:

1. Outright formation by the employer or his representatives;
2. Employee formation on outright demand or influence by employer, and
3. Managerially motivated formation by employees.

FINANCIAL SUPPORT TO THE UNION BY:

1. Employer defrays union expenses;
2. Pay’s attorney’s fees to the attorney who drafted the constitution or by laws of the
union;

EMPLOYER ENCOURAGEMENT AND ASSISTANCE

Immediately granting of exclusive recognition as bargaining agent without
determining whether the union represents majority of the employees.

SUPERVISION ASSISTANCE
Soliciting membership, permitting union activities during work time or coercing
employees to join the union by threats of dismissal or demotion.

5. DISCRIMINATION
To discriminate in regard to wages, hours of work and other terms and conditions of
employment in order to encourage or discourage membership in any labor organization.

TEST: whenever the benefits or privileges given to one is not given to the other under
similar or identical conditions when directed to encourage or discourage union
membership.
Three Components of Discrimination
1. It prohibits discrimination in terms and conditions of employment in order to
encourage or discourage membership in the union.
2. It gives validity to union security agreement; and
3. It allows an agency shop arrangement whereby agency fees may be collected from
non-union members.

6. DISCRIMINATION BECAUSE OF TESTIMONY

To dismiss, discharge or otherwise prejudice or discriminate against an employee for
having given or being about to give testimony under this Code.

SUBJECT MATTER OF TESTIMONY: can be anything under the Code

What is ULP is the employer’s retaliatory act regardless of the subject of employee’s
complaint or testimony.

7. VIOLATION OF DUTY TO BARGAIN

To violate the duty to bargain collectively as prescribed by this Code.

The following acts are held to constitute refusal to bargain

1. Alleging that the union is irresponsible;
2. Transferring operation to elude the union (run-Away shop)

RUN-AWAY SHOP
- Is an unfair labor practice of management which usually takes place by effecting the
transfer or ownership, the plant itself, or its equipment, or by temporarily closing its
business purposely to bust the union or to evade the payment of legitimate
obligations.

1. Delaying negotiations by discussing unrelated matters;

2. Refusal to accept request to bargain;
3. Rejecting a union’s effort to prove its majority claim.
4. Shutdown to avoid bargaining; and
5. Engaging in surface bargaining.

SURFACE BARGAINING
o Going through the motions of negotiating without any legal intent to reach an
agreement. It involves the question of whether or not the employer’s conduct
demonstration an unwillingness to bargain in good faith or is merely hard
bargaining.
8. PAID NEGOTIATION
To pay negotiation or attorney’s fees to the union or its offices or agents as part of the
settlement of any issue in collective bargaining or any other disputes.

9. VIOLATION OF CBA
The violation must be gross; flagrant and/or malicious refusal to comply with the
economic provision of the CBA.

UNFAIR LABOR PRACTICES OF LABOR ORGANIZATIONS

1. To restrain or coerce employees in the exercise of their right to self-organization.

However, a labor organization shall have the right to prescribe its own rules with
respect to the acquisition or retention of membership;
2. To cause per attempt to cause an employer to discriminate against an employee
with respect to whom membership in such organization has been denied or to
terminate an employee on any ground other than the usual terms and conditions
under membership or continuation of membership is made available to other
members;
3. To violate the duty or refuse to bargain collectively with the employer provided that
it is the representative of the employee.
 4. To cause or attempt to cause an employer to pay or deliver any money or other
things of value, in the nature of an exaction, for services which are not performed,
including the demand for a fee for union negotiations;

FEATHERBREDDING (make-work activities)

o Refers to the practice of union or its agents in causing or attempting to cause an
employee to pay or deliver money or other things of value, in nature of exaction, for
services which are not performed or not to be performed, as when the union
demands that the employer maintain personnel in excess of the letter’s
requirements.

5. To ask do or accept negotiations or attorney’s fees from employers as part of the

settlement of ay issue in collective bargaining or any other dispute, or
6. To grossly violate a collective bargaining agreement.

PERSONS CIVILLY LIABLE ULP:

1. Officers and agents of employer;
2. Labor organization, officers and agents; and
3. Agents and officers whose participated or authorized or ratified the act

SWEETHEART DOCTRINE
o Consider it to ULP for a labor organization to ask for or accept negotiations or
attorney’s fees from the employer in settling a bargaining issue or dispute.

Resulting CBA is considered a “sweetheart contract” a CBA does not substantially

improve the employees’ wages and benefits and whose benefits are far below those
that are provided by the law.

BLUE-SKY BARGAINING
o Defined as making exaggerated or unreasonable proposals. Whether or not the
union is engaged in blue-sky bargaining is determined by the evidence presented by
the union as to its economic demands. Thus, if the union requires exaggerated or
unreasonable economic demands.

TYPES OF STRIKES
1. Economic Strike
o Used to secure the economic demands such as higher wages and better working
conditions for the workers.
2. ULP Strike
o Protest against ULP of management.

FORMS OF STRIKE AND THEIR VAILIDITY

a. Sit-down Strike
o Characterized by a temporary work stoppage of workers who thereupon seize or
occupy property of the employer or refuse to vacate the premises of the employer

Illegal: amounts to a criminal act because the employees trespass on the premises of
the employer.

b. Wildcat Strike
o work stoppage that violates the labor contract and is not authorized and disowned
by the union.

Illegal: fails to comply with certain requirements of the law. Wit: notice of strike, vote
and report on strike vote.

c. Sympathetic Strike
 o Work stoppage or workers of one company to make common cause with other
strikes of other companies, without demands or grievances of their own against the
employer.

Illegal: because there is no labor dispute between the workers who are joining the
strikers and latter’s employer.

d. Secondary Strike
o are work of stoppage of workers of one company to exert pressure on their
employer so that the latter will in turn bring pressure upon the employer of another
company with whom another union has a labor dispute.

Illegal: because there is no labor dispute involved.

e. Cause-Oriented Strikes
o To make stand on certain national issues.

Welga ng Bayan Illegal: a “welga ng Bayan” is illegal because it is a political strike

and therefore there is neither a bargaining deadlock nor any ULP it is political rally

f. Quickie Strikes
o Brief and unannounced temporary work stoppage.

GROUNDS FOR DECLARATION OF STRIKE

1. Deadlock on collective bargaining: and/or
2. Unfair labor practice.
CHAPTER TEST
Answer the following:

1. What are authorized causes for a valid dismissal by the employer of an employee?
Why are there distinct from the just cause? (10)

2. a. What conditions must prevail and what requirements, if any, must an employer
comply with to justify/effect a valid retrenchment program? (10)

3. Katie is a teacher in Santibanez High School, she is the class adviser of the senior
batch where Randolph is enrolled; since it is the policy of the school to extend
remedial instructions to students, Randolph is imparted such instruction in school
by Katie after regular class hours. In the course therefore, Katie and Randolph fell in
love with each other and shortly got married. Katie is 31 years old while Randolph is
only 16. Santibanez High School thereafter seeks to terminate the employment of
Katie for abusive and unethical conduct unbecoming a dignified school teacher and
that her continued employment is inimical to the best interest and would
downgrade the high moral values of the school.

Katie according to the school, recklessly took advantage of her position as a teacher
by luring a graduating student under her advisory section and 15 years her junior
into an enormous relationship [, in violation of the Code of Ethics for Teacher which
states, among others, that a “school official teacher should never take advantage of
his/her position to court a pupil or student “while no one directly saw Katie and
Randolph.

4. Armie is the Executive Secretary of the Senior Vice-president of a bank while Noreen
is the Legal Secretary of the bank’s lawyer. They and other executive secretaries
would like to join the union of rank and file employees of the bank. Are they eligible
to join the union? Why? Explain briefly (5)

5. Ruben Padilla entered into a written agreement with Gomburza College to work for
the latter in exchange for the privilege of studying in said institution. Ruben’s work
was confined to keeling clean the lavatory facilities of the school. One school day,
Ruben got into a fist fight with a classmate, Victor Monteverde, as a result of which
the latter sustained a fractured arm. Victor Monteverde filed a civil case for damages
against Ruben Padilla, impleading Gumborza College due to the latter alleged
liability as an employer for Ruben Padilla Under the circumstances, could Gomburza
College be held liable by Victor Monteverde as an employer of Ruben Padilla?
REQUIRED READINGS:

Presidential Decree No. 442, otherwise known as the Labor Code of the Philippines,
as amended, pertinent rules and regulations, and selected cases.

RESOURCES

C.A. Azucena, The Labor Code of the Philippines, annotated. C.A. Azucena,
Everyone’s Labor Code. A.R. V. Samson, A Comprehensive Guide on Conditions of
Employment, Employee Benefits under Special laws.