7 BASIC THEORIES SUMMARIZING THE LABOR CODE respect.
respect. How society treats him will determine whether the knife
Azucena (2013) reports that, when the Labor Code was issued in
1974, Blas F. Ople, then Minister of Labor of President Marcos,
explained that there are seven innovative principles that spread
throughout the entire composition of Presidential Decree (PD)
No. 442 , otherwise known as the Labor Code of the Philippines,
namely: national development; strikes and lockouts; speedy labor
justice; bargaining power; employment and unemployment;
enforcement and implementation; and, tripartism.
[1] NATIONAL DEVELOPMENT. Labor relations must be
made both responsive and responsible to national
development.
The State affirms labor as a primary social economic force. It
shall protect the rights of workers and promote their welfare. The
State also recognizes the indispensable role of the private sector,
encourages private enterprise, and provides incentives to needed
investments.
In a case, the Supreme Court took the opportunity to reaffirm its
concern for the lowly worker who, often at the mercy of his
employers, must look up to the law for his protection. Fittingly,
that law regards him with tenderness and even favor and always
with faith and hope in his capacity to help in shaping the nation's
future. It is error to take him for granted. He deserves our abiding
peace", further eliminated appeals from the NLRC to the
in his hands shall be a caring tool for beauty and progress or an Secretary of Labor but the President still continued to exercise his
angry weapon of defiance and revenge. The choice is obvious, of power to assume jurisdiction over any cases which he considered
course. If we cherish him as we should, we must resolve to national interest cases. (G.R. No. 123426)
lighten "the weight of centuries" of exploitation and disdain that
bends his back but does not bow his head. (G.R. No. L-58639) The rationale of the law on voluntary arbitration is speedy labor
justice. (G.R. No. 170054) In one case, the Supreme Court
[2] STRIKES AND LOCKOUTS. Labor laws or labor stressed that the Voluntary Arbitrator had plenary jurisdiction and
relations during a period of national emergency must authority to interpret the agreement to arbitrate and to determine
substitute rationality for confrontation; therefore, strikes or the scope of his own authority subject only, in a proper case, to
lockouts give away to a rational process which is arbitration. the certiorari jurisdiction of this Court. The Arbitrator, as already
indicated, viewed his authority as embracing not merely the
The State shall guarantee the rights of all workers to self- determination of the abstract question of whether or not a
organization, collective bargaining and negotiations, and peaceful performance bonus was to be granted but also, in the affirmative
concerted activities, including the right to strike in accordance case, the amount thereof. (G.R. No. 140960)
with law. They shall be entitled to security of tenure, humane
conditions of work, and a living wage. They shall also participate [4] BARGAINING POWER. Manpower development and
in policy and decision-making processes affecting their rights and employment must be regarded as a major dimension of labor
benefits as may be provided by law. policy, for there can be no real equality of bargaining power
under conditions of severe mass unemployment.
[3] SPEEDY LABOR JUSTICE. Laggard justice in the labor
field is injurious to the workers, the employers and the The State shall guarantee the rights of all workers to self-
public; labor justice can be made expeditious without organization, collective bargaining and negotiations, and
sacrificing due process. peaceful concerted activities, including the right to strike in
accordance with law. They shall be entitled to security of tenure,
All persons shall have the right to a speedy disposition of their humane conditions of work, and a living wage. They shall also
cases before all judicial, quasi-judicial, or administrative bodies. participate in policy and decision-making processes affecting
P.D. No. 1367 amending certain provisions of the Labor Code their rights and benefits as may be provided by law.
eliminated appeals to the President, but gave the President the
power to assume jurisdiction over any cases which he considered It is unlawful for any person to restrain, coerce, discriminate
national interest cases. The subsequent P.D. No. 1391, enacted against or unduly interfere with employees and workers in their
"to insure speedy labor justice and further stabilize industrial exercise of the right to self-organization. Such right shall include
the right to form, join, or assist labor organizations for the
purpose of collective bargaining through representatives of their
own choosing and to engage in lawful concerted activities for the
same purpose or for their mutual aid and protection, subject to the
provisions of Article 264 of the Labor Code.
All employees enjoy the right to self-organization and to form
and join labor organizations of their own choosing for the
purpose of collective bargaining and to engage in concerted
activities for their mutual aid or protection. This is a fundamental
right of labor that derives its existence from the Constitution. In
interpreting the protection to labor and social justice provisions of
the Constitution and the labor laws or rules or regulations, we
have always adopted the liberal approach which favors the
exercise of labor rights. In one case, it was crystal clear the
monthly paid rank-and-file employees of petitioner have very
little in common with its daily paid rank-and file employees in
terms of duties and obligations, working conditions, salary rates,
and skills. To be sure, the said monthly paid rank-and-file
employees have even been excluded from the bargaining unit of
the daily paid rank-and-file employees. This dissimilarity of
interests warrants the formation of a separate and distinct
bargaining unit for the monthly paid rank-and-file employees of
the petitioner. To rule otherwise would deny this distinct class of
employees the right to self-organization for purposes of collective
bargaining. Without the shield of an organization, it will also
expose them to the exploitations of management. (G.R. Nos.
113204-05)
[5] UNEMPLOYMENT. There is a global labor market
available to qualified Filipinos, especially those who are
unemployed or whose employment is tantamount to
unemployment because of their very little earnings.
penalized, and only a corrupt few — those who are in charge of
implementation — may get the reward they do not deserve.
The State shall promote a just and dynamic social order that will
ensure the prosperity and independence of the nation and free the The Department of Labor and other government agencies charged
people from poverty through policies that provide adequate social with the administration and enforcement of the Labor Code or
services, promote full employment, a rising standard of living, any of its parts shall promulgate the necessary implementing
and an improved quality of life for all. The State shall afford full rules and regulations. Such rules and regulations shall become
protection to labor, local and overseas, organized and effective fifteen (15) days after announcement of their adoption
unorganized, and promote full employment and equality of in newspapers of general circulation
employment opportunities for all.
Among other powers, the Secretary of Labor and Employment or
Unemployment brings untold hardships and sorrows on those his duly authorized representatives, including labor regulation
dependent on the wage-earner. The misery and pain attendant on officers, shall have access to employer’s records and premises at
the los-, of jobs then could be avoided if there be acceptance of any time of the day or night whenever work is being undertaken
the view that under all the circumstances of this case, petitioners therein, and the right to copy therefrom, to question any
should not be deprived of their means of livelihood. Nor is this to employee and investigate any fact, condition or matter which may
condone what had been done by them. For all this while, since be necessary to determine violations or which may aid in the
private respondent considered them separated from the service, enforcement of the Labor Code and of any labor law, wage order
they had not been paid. For the strictly juridical standpoint, it or rules and regulations issued pursuant thereto.
cannot be too strongly stressed . . . that where a decision may be
made to rest on informed judgment rather than rigid rules, all the [7] TRIPARTISM. There should be popular participation in
equities of the case must be accorded their due weight. Finally, national policy-making through what is now called
labor law determinations should be not only secundum rationem tripartism.
but also secundum caritatem. (G.R. No. L-54280)
Tripartism in labor relations is a State policy. Towards this end,
workers and employers shall, as far as practicable, be represented
in decision and policy-making bodies of the government. The
[6] ENFORCEMENT AND IMPLEMENTATION. Labor
Secretary of Labor and Employment or his duly authorized
laws must command adequate resources and acquire a
representatives may, from time to time, call a national, regional,
capable machinery for effective and sustained
or industrial tripartite conference of representatives of
implementation; otherwise, they merely breed resentment not
government, workers and employers for the consideration and
only of the workers but also of the employers. When labor
adoption of voluntary codes of principles designed to promote
laws cannot be enforced, both the employers and the workers are
industrial peace based on social justice or to align labor
movement relations with established priorities in economic and
social development. In calling such conference, the Secretary of
Labor and Employment may consult with accredited
representatives of workers and employers. (Section 32. Republic
Act No. 6715. March 21, 1989)

The discussion above is based on an outline by Azucena (2013).

His books are available in fine bookstores
nationwide. SOURCE: Azucena, C. A. (2013). The Labor Code:
with Comments and Cases (Vol. 1). National Book Store.
https://www.rexestore.com/labor-standards/981-the-labor-code-
with-comments-and-cases-volume-i-revised-edition.html. He
cites, as his primary source, Blas F. Ople's speech, Frontiers of
Social and Labor Policy; Personnel Management Association of
the Philippines, Proceedings of the Special Conference on the
Labor Code of the Philippines, June 1974.

General Structure of the Labor Code
The Labor Code is composed of a Preliminary Title and seven (7)
books as follows:
 Preliminary Title
Chapter I - General Provisions (Articles 1 to 6)
Chapter II - Emancipation of Tenants (Articles 7 to 11)
 Book I- Pre-Employment (Article 12)
Title I - Recruitment and Placement of Workers
Chapter I - General Provisions (Articles 13 to 24)
Chapter II - Regulation of Recruitment and Placement Activities
(Articles 25 to 35)
Chapter III - Miscellaneous Provisions (Articles 36 to 39) Title II
- Employment of Non-Resident Aliens (Articles 40 to 42)
 Book II - Human Resources Development Program
Title I - National Manpower Development Program
Chapter I - National Policies and Administrative Machinery for
Their Implementation (Articles 43 to 56)
Title II - Training and Employment of Special Workers
Chapter I - Apprentices (Articles 57 to 72)
Chapter II - Leamers (Articles 73 to 77)
Chapter III – Handicapped Workers (Articles 78 to 81)
 Book III - Conditions of Employment
Title I - Working Conditions and Rest Periods
Chapter I - Hours of Work (Articles 82 to 90)
Chapter II - Weekly Rest Periods (Articles 91 to 93)
Chapter III – Holidays, Service Incentive Leaves and Service
Charges (Articles to 96)
Title II - Wages
Chapter I - Preliminary Matters (Articles 97 to 98)
Chapter II - Minimum Wage Rates (Articles 99 to 101)
Chapter III - Payment of Wages (Articles 102 to 111)
Chapter IV - Prohibitions Regarding Wages (Articles 112 to 119)
Chapter V - Wage Studies, Wage Agreements and Wage
Determination (Articles
120 to 127)
Chapter VI - Administration and Enforcement (Articles 128 to
129)
Title III - Working Conditions for Special Groups of Employees
Chapter I - Employment of Women (Articles 130 to 138)
Chapter II - Employment of Minors (Articles 139 to 140)
Chapter III - Employment of Househelpers (Articles 141 to 152)
Chapter IV - Employment of Homeworkers (Articles 153 to 155)
 Book IV - Health, Safety and Social Welfare Benefits
Title I - Medical, Dental and Occupational Safety
Chapter I - Medical and Dental Services (Articles 156 to 161)
Chapter II - Occupational Health and Safety (Articles 162 to 165)
Title II - Workmen's Compensation and State Insurance Fund
Chapter I - Policy and Definitions (Articles 166 to 167)
Chapter II - Coverage and Liability (Articles 168 to 175)
Chapter III- Administration (Articles 176 to 182)
Chapter IV - Contributions (Articles 183 to 184)
Chapter V-Medical Benefits (Articles 185 to 190)
Chapter VI - Disability Benefits (Articles 191 to 193)
Chapter VII - Death Benefits (Article 194)
Chapter VIII - Provisions Common to Income Benefits (Articles
195 to 204)
Chapter IX - Records, Reports and Penal Provisions (Articles 205
to 208)
Title III - Medicare (Article 209)
Title IV - Adult Education (Article 210)
 Book V-Labor Relations
Title I - Policy and Definitions
Chapter I - Policy (Article 211)
Chapter II - Definitions Article 212)
Title II - National Labor Relations Commission
Chapter I - Creation and Composition (Articles 213 to 216
Chapter II - Powers and Duties (Articles 217 to 222)
Chapter III - Appeal (Articles 223 to 225)
Title III - Bureau of Labor Relations Articles 226 to 233)
Title IV - Labor Organizations
Chapter I - Registration and Cancellation (Articles 234 to 240)
Chapter II – Rights and Conditions of Membership (Article 241)
Chapter III - Rights of Legitimate Labor Organizations (Article
242)
Title VI - Unfair Labor Practices
Chapter I - Concept (Article 247)
Chapter II - Unfair Labor Practices of Employers (Article 248)
Chapter III - Unfair Labor Practices of Labor Organizations
(Article 249)
Title VII - Collective Bargaining and Administration of
Agreements (Articles 250 to 259)
Title VII-A-Grievance Machinery and Voluntary Arbitration
(Articles 260 to 262-B)
Title VIII - Strikes and Lockouts and Foreign Involvement in
Trade Union Activities
Chapter I - Strikes and Lockouts (Articles 263 to 266)
Chapter II - Assistance to Labor Organizations (Articles 267 to
268)
Chapter III - Foreign Activities (Articles 269 to 271)
Chapter IV - Penalties for Violation (Article 272) Tide LX-
Special Provisions (Articles 273 to 277)
 Book VI - Post Employment
Title I-Termination of Employment (Articles 278 to 286)
Title II - Retirement from the Service (Article 287)
 Book VII -Transitory and Final Provisions
Title I - Penal Provisions and Liabilities (Articles 288 to 289)
Title II - Prescription of Offenses and Claims (Articles 290 to
292)
Title III - Transitory and Final Provisions (Articles 293 to 302)
Labor standards law covers: Books One to Four of the Labor
Code as well as Book VI thereof which deal with working
conditions, wages, hours of work, holiday pay and other benefits,
conditions of employment of women, minors, househelpers and
homeworkers, medical and dental services, occupational health
and safety, termination of employment and retirement.
Labor relations law covers: Book V of the Labor Code which
deals with labor organizations, collective bargaining, grievance
machinery, voluntary arbitration, conciliation and mediation,
unfair labor practices, strikes, picketing and lockout.
 
*Please take note of the re-numbering of provisions
7 Salient Features of the Labor Code
The following are the salient features of the Labor Code at the
time of its enactment:
1. It reorients labor laws towards development and
employment goals
(a)   By purging laws with built-in leverages for graft and
corruption on the part of labor law enforcers and fly-by-night
labor leaders,
(b) By removing archaic and unworkable provisions of labor
laws, and
(c) By eliminating the permit system without impairing the
substantive rights
and privileges and the umbrella of protection assured by law to
the workers.
2. It institutionalizes the National Labor Relations
Commission (NLRC) established under P.D. No. 21 in place
of the Court of Industrial Relations (CIR). Composed of one
representative of government who shall act as chairman and
two representatives each of labor and management, the
NLRC is attached to the Department of Labor rather than to
the Supreme Court to make possible the speedy settlement of
labor disputes unhampered by legal and judicial
technicalities and to give the President of the Philippines a
free hand in the direction and control of the labor relations
machinery under Marcos' New Society. NLRC procedures
are non-technical but they assure due process; hence, the
guaranty of swift justice for all.
3. It abolishes the workmen's compensation system which
has become graft-ridden and workable and integrates
workmen's compensation into the social security system to
be administered by the SSS for the private sector and by the
GSIS for the government sector This will save the
government at least P28 Million a year in dubious
workmen’s compensation claims, facilitate the prompt
payment of benefits, assure payment of more meaningful
compensation, save the government P12 Million in
administrative expenses and enables a new major source of
funds for economic and social development,
4. It establishes an Overseas Employment Development
Board (OEDB) and a National Seamen Board (NSB) to
undertake the systematic employment of Filipinos overseas
and optimize the national benefit therefrom in the form of
dollar remittances and improved skills and technology for
the people. At the same time, the establishment of these two
bodies the Department of Labor will liberate the recruitment
and placement of Filipino workers from abuse and
exploration
5. implements the provision of the 1973 Constitution,
placing employees of government-owned and controlled
corporations under the Civil Service and mandating the
National Assembly to standardize salaries. The terms and
conditions of employees of government-owned and
controlled corporations are henceforth fixed by law rather
than left to collective bargaining.
6. It ends the wasteful energy-snapping anarchy and
opportunism in the Philippine labor movement by
restructuring it by region and by industry. The aim is to stop
the interminable inter-union and intra-union rivalries which
accounted for more than fifty percent (50%) of all strikes,
demonstrations and lockouts under the Old Society. It is
expected to transform unions into positive and responsible
agents of democracy, social justice and development.
7. It abolishes the wage-fixing function of the Wage
Commission by transforming it into a study and research
body only with power to recommend adjustments in the
minimum wages to the Secretary of Labor who may adopt
such recommendations subject to the approval by the
President of the Philippines.
The other new features of the draft of the Labor Code are those
embodied in PDs 143, 148 and 173 adjusting labor standards laws
to the requirements of development and employment earlier
approved by the President. In sum, the enactment of the draft
Labor Code into law aligns labor laws, labor-management
relations and the trade union movement to the urgent goals and
aspirations of the people under the New Society. (pgs. 2-3, Chan
Labor Code)

Relevant Civil Code provisions
Interpretation of the Labor Code
Art. 1700. The relations between capital and labor are not merely
contractual. They are so impressed with public interest that labor
contracts must yield to the common good. Therefore, such
contracts are subject to the special laws on labor unions,
collective bargaining, strikes and lockouts, closed shop, wages,
working conditions, hours of labor and similar subjects.
Relevant Cases for Art. 1700:
G.R. NOS. 182978-79: Becman vs. Cuaresma
The relations between capital and labor are so impressed with
public interest, and neither shall act oppressively against the
other, or impair the interest or convenience of the public. In case
of doubt, all labor legislation and all labor contracts shall be
construed in favor of the safety and decent living for the laborer.
G.R. No. 162839: INNODATA
PHILIPPINES vs. QUEJADA-LOPEZ
In the interpretation of contracts, obscure words and provisions
shall not favor the party that caused the obscurity. Consequently,
the terms of the present contract should be construed strictly
against petitioner, which prepared it.
Indeed, a contract of employment is impressed with public
interest. For this reason, provisions of applicable statutes are
deemed written into the contract. Hence, the "parties are not at
liberty to insulate themselves and their relationships from the
impact of labor laws and regulations by simply contracting with
each other." Moreover, in case of doubt, the terms of a contract
should be construed in favor of labor.
Leyte Geothermal vs. PNOC-EDC
Kinds of Labor Contracts
The employment contracts referred to in Article 1700 may either
be:
1. Employment contract; or
2. Collective Bargaining Agreement (CBA)
Leyte Geothermal vs. PNOC-EDC, illustrates a case involving an
employment contract. The issue here is whether the member of
petitioners are project employees. The court pronounced that
Article 295(280) of the Labor Code, as worded, establishes that
the nature of the employment is determined by law, regardless of
any contract expressing otherwise. The supremacy of the law
over the nomenclature of the contract and the stipulation
contained therein is to bring to life the policy enshrined in the
Constitution to “afford full protection to labor.” Thus, labor
contracts are placed on a higher plane than ordinary contracts;
these are imbued with public interest and therefore subject to the
police power of the State. However, notwithstanding the
foregoing iterations, project employment contracts which fix the
employment for a specific project or undertaking remain valid
under the law. In the case at bar, the records reveal that the
officers and the members of petitioner union signed employment
contracts indicating the specific project or phase of work for
which they were hired, with a fixed period of employment. As
clearly shown by petitioner union’s own admission, both parties
had executed the contracts freely and voluntarily without force,
duress or acts tending to vitiate the worker’s consent. Thus, there
is no reason not to honor and give effect to the terms and
conditions stipulated therein.
Art. 1702. In case of doubt, all labor legislation and all labor
contracts shall be construed in favor of the safety and decent
living for the laborer.
Arts. 1703-1712 have labor law signification and implication.
Relevant RPC provisions

It is settled that a person may be charged and convicted

separately of illegal recruitment under Republic Act No. 10022 in
relation to the Labor Code, and estafa under Art. 315, paragraph
2(a) of the Revised Penal Code.

The crime of Simple Illegal Recruitment, as a general rule, is

committed when two essential elements concur:

1. that the offender has no valid license or authority

required by law to enable him to lawfully engage in the
recruitment and placement of workers, and/ or
2. that the offender undertakes any activity within the
meaning of recruitment and placement defined under
Republic Act No. 10022 or any prohibited practices
enumerated thereunder.

Illegal recruitment shall mean any act of canvassing, enlisting,

contracting, transporting, utilizing, hiring, or procuring workers
and includes referring, contract services, promising or advertising
for employment abroad, whether for profit or not, when
undertaken by a non-licensee or non-holder of authority
contemplated under Article 13(f) of the Labor Code of the
Philippines (Links to an external site.): Provided, That any such
non-licensee or non-holder who, in any manner, offers or
promises for a fee employment abroad to two or more persons
shall be deemed so engaged. It shall likewise include the
enumerated acts, whether committed by any person, whether a
non-licensee, non-holder, licensee or holder of authority:

Article 13(b) of the Labor Code defines recruitment and

placement as:

Any act of canvassing, enlisting, contracting, transporting,

utilizing, hiring, or procuring workers, and includes referrals,
contract services, promising or advertising 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.

Arts. 272-274, 278, 288, 289, 291, 292, 310, 316 [5]

Relevant Constitutional provisions
Art. II, Sec. 18 - “The State affirms labor as a primary social
economic force. It shall protect the rights of workers and promote
their welfare.”
Art. III, Sec. 18, par. 2 –No involuntary servitude in any form
shall exist except as a punishment for a crime whereof the party
shall have been duly convicted.
Art. IX-B, Sec. 2, Par. 1 and 3
(1) The civil service embraces all branches, subdivisions,
instrumentalities, and agencies of the Government, including
government-owned or controlled corporations with original
charters.
cooperatives, and similar collective organizations, shall have the
right to own, establish, and operate economic enterprises, subject
to the duty of the State to promote distributive justice and to
intervene when the common good so demands.
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.
Art. XII, Sec. 14, par. 2 – The sustained development of a
reservoir of national talents consisting of Filipino scientists,
entrepreneurs, professionals, managers, high-level technical
manpower and skilled workers and craftsmen in all fields shall be
promoted by the State. The State shall encourage appropriate
technology and regulate its transfer for the national benefit.
The practice of all professions in the Philippines shall be limited
to Filipino citizens, save in cases prescribed by law.
decision-making processes affecting their rights and benefits as
may be provided by 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 workers and
employers, recognizing the right of labor to its just share in the
fruits of production and the right of enterprises to reasonable
returns on investments, and to expansion and growth.

(2) Appointments in the civil service shall be made only
according to merit and fitness to be determined, as far as
practicable, and, except to positions which are policy-
determining, primarily confidential, or highly technical, by
competitive examination.
(3) No officer or employee of the civil service shall be removed
or suspended except for cause provided by law.
(4) No officer or employee in the civil service shall engage,
directly or indirectly, in any electioneering or partisan political
campaign.
(5) The right to self-organization shall not be denied to
government employees.
(6) Temporary employees of the Government shall be given such
protection as may be provided by law.
Art. IX-B, Sec. 5 - The Congress shall provide for the
standardization of compensation of government officials and
employees, including those in government-owned or controlled
corporations with original charters, taking into account the nature
of the responsibilities pertaining to, and the qualifications
required for their positions.
Art. XII, Sec. 6 - The use of property bears a social function, and
all economic agents shall contribute to the common good.
Individuals and private groups, including corporations,
Art. XII, Sec. 16 – The Congress shall not, except by general
law, provide for the formation, organization, or regulation of
private corporations. Government-owned or controlled
corporations may be created or established by special charters in
the interest of the common good and subject to the test of
economic viability.
Art. XIII, Sec. 1 – The Congress shall give highest priority to the
enactment of measures that protect and enhance the right of all
the people to human dignity, reduce social, economic, and
political inequalities, and remove cultural inequities by equitably
diffusing wealth and political power for the common good.
Art. XIII, Sec. 2- The promotion of social justice shall include
the commitment to create economic opportunities based on
freedom of initiative and self-reliance.
Art. XIII, 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 for 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 law.
They shall be entitled to security of tenure, humane conditions of
work, and a living wage. They shall also participate in policy and
What is the protection-to-labor clause in the Constitution?

“The State shall afford full protection to labor, local and overseas,
organized and unorganized, and promote full employment and
equality of employment opportunities for 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 law. They shall be
entitled to security of tenure, humane conditions of work, and a
living wage. They shall also participate in policy and decision-
making processes affecting their rights and benefits as may be
provided by 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 workers and

employers, recognizing the right of labor to its just share in the
fruits of production and the right of enterprises to reasonable
returns on investments, and to expansion and growth.” (Section 3
(Labor), Article XIII [Social Justice and Human Rights] of the
1987 Constitution)
What are the basic principles enunciated in the Labor Code on
protection to labor?

a. The State shall afford protection to labor, promote full

employment, ensure equal work opportunities regardless
of sex, race or creed and regulate the relations between
workers and employers. The State shall assure the rights
of workers to self-organization, collective bargaining,
security of tenure, and just and humane conditions of
work.

b. Labor contracts are not ordinary contracts as the

relation between capital and labor is impressed with
public interest.

c. In case of doubt, labor laws and rules shall be

interpreted in favor of labor.

d. Labor Code applies to all workers, whether

agricultural or non-agricultural.

e. Applicability of Labor Code to government-owned or

controlled corporations: 

• When created with original or special charter

- Civil Service laws, rules and regulations;

• When created under the Corporation Code -

Labor Code applies.

Survey of doctrinal cases in Labor based on Constitutional
provisions
Waterous drugs and Andre Marti cases on unreasonable
search and seizure
***WON the right against unreasonable searches and seizures
and right to privacy of communication guaranteed under the
Constitution may be invoked by an employee against her
employer. ---------SC reasoned: "As regards the constitutional
violation upon which the NLRC anchored its decision, we find no
reason to revise the doctrine laid down in People v. Andre Marti,
that the Bill od Rights does not protect citizens from
unreasonable searches and seizures perpetrated by private
individuals. It is not true, as counsel for Catolico claims, that the
citizens have no recourse against such assaults. On the contrary,
and as said counsel admits, such an invasion gives rise to both
criminal and civil liabilities". Alleged violations against
unreasonable search and seizure may only be invoked against the
State by an individual unjustly traduced by the exercise of
sovereign authority. To agree with appellant that an act of a
private individual in violation of the Bill of Rights should also be
construed as an act of the State would result in serious legal
complications and an absurd interpretation of the Constitution.
Similarly, the admissibility of the evidence procured by an
individual effected through private seizure equally applies, in pari
passu, to the alleged violation, non-governmental as it is, of
appellant's constitutional rights to privacy and communication.
Lopez v. Alturas Group of Companies on right to counsel
***Would the failure of the employer to inform the employee
who is undergoing administrative investigation of his right to
counsel amount to deprivation of due process? -------NO. The SC
held that "the right to counsel and the assistance of one in
investigations involving termination cases is neither
indispensable nor mandatory, except when the employee himself
request for one or that he manifests that he wants a formal
hearing on the charges against him. In petitioner's case, there is
no showing that he requested for a formal hearing to be
conducted or that he be assisted by counsel".
THE CONFERENCE OF MARITIME MANNING
AGENCIES, INC., CASE: CONSTITUTIONA
PROHIBITION AGAINST IMPAIRING CONTRACTUAL
OBLIGATIONS IS NOT ABSOLUTE.[1]
The constitutional prohibition against impairing contractual
obligations is not absolute and is not to be read with literal
exactness. It is restricted to contracts with respect to property or
some object of value and which confer rights that maybe asserted
in a court of justice; it has no application to statutes relating to
public subjects within the domain of the general legislative
powers of the State and involving the public rights and public
welfare of the entire community affected by it. It does not prevent
a proper exercise by the State of its police power by enacting
regulations reasonably necessary to secure the health, safety,
morals; comfort, or general welfare of the community, even
though contracts may thereby be affected, for such matters cannot
be placed by contract beyond the power of the State to regulate
and control them.
Serrano doctrine , Ineffectual Dismissal
The rule on the extent of the sanctions was changed in the en
banc decision in Serrano vs. NLRC. The Court held that the
violation by the employer of the notice requirement in
termination for just and authorized causes was not a denial of due
process that will nullify the termination. However the dismissal is
declared ineffectual and the employer must pay full back wages
from the time of the termination until it is judicially declared that
the dismissal was for a just and authorized cases.
Anucension case on religious sects exemptions
“ The right to refrain from joining labor organizations recognized
by section 3 of the industrial peace Act is however limited. The
legal protection, granted to such right to refrain from joining is
withdrawn by operation of law, where a labor union and an
employer have agreed on a closed shop by virtue of the collective
bargaining unit, and the employess must continue to be members
of the union for the duration of the contract  in order to keep their
jobs. RA 3350, provides that although it would be an unfair labor
practice for an employer to discriminate in regard to hire or
tenure of employment or any term or condition of employment to
encourage or discourage membership in any labor organization,
the employer is however not precluded from making an
agreement with the labor organization to require a condition of
employment  membership therein.
“ The constitutional provision not only prohibits legislation for
the support of any previous tenets or the modes of worship of any
sect, thus forestalling compulsion by law of the acceptance of any
creed or the practice of any form of worship but also assures the
free exercise of one’s chosen form of religion within the limits of
utmost amplitude. It has been said that religion clauses of religion
clauses of the Constitution are all designed to protect the broadest
possible liberty of conscience, to allow each man to believe as his
conscience directs, to profess his beliefs, and to live as he
believes he ought to live, consistent with the liberty of others and
the common good.
Any legislation whose effect or purpose is to impede the
observance of one or all religions, or discriminate invidiously
between the religions, is invalid even though the burden may be
characterized as being only indirect.
Strike and picketing on publicizing the labor dispute
To strike is to withhold or to stop work by concerted action of the
employees as a result of an industrial or labor dispute. The work
stoppage may be accompanied by the striking employees outside
the company accompanied by picketing by the striking employees
outside of the company compound. While a strike focuses on
stoppage of work, picketing focuses on publicizing the labor
dispute and its incidents to inform the public of what is
happening in the company struck against.
 A picket simply means to march to and from the employers
premises, usually accompanied by the display of placards and
other signs making known the facts involved in a labor dispute. It
is a strike activity separate and different from the actual stoppage
of work.
BPI vs BPI employees union-involuntary servitude
In the case of BPI vs BPI Employees union, it involves the
merger of BPI with FEBTC, where the Voluntary Arbitrator ruled
that, in accordance with Section 80 of the Corporation Code, the
employees of FEBTC from part of the assets and liabilities
transferred to the surviving bank, petitioner BPI, by virtue of the
merger. The SC, however, did not agree to this postulation. In
legal parlance, human beings are never embraced in the term
asset and liabilities. It is contrary to public policy to declare the
FEBTC employees as forming part of the assets or liabilities of
FEBTC that were transferred and absorbed by BPI on the Assets
and Liabilities. Assets and Liabilities, in this instance, should be
deemed to refer only to property rights and obligations of FEBTC
and do not include the employment contracts of its personnel. A
corporation cannot unilaterally transfer its employees to another
employer like chattel. Certainly, if BPI as an employer had a right
to choose who to retain among the FEBTC’s employees, FEBTC
employees had the concomitant right to choose not to be absorbed
by BPI. Certainly nothing prevented the FEBTC’s employees
from resigning or retiring and seeking employment elsewhere
instead of going along with the proposed absorption.
Employment is a personal consensual contract and absorption by
BPI of a former FEBTC employee without the consent of the
employee is in violation of an individual’s freedom to contact. It
would have been a different matter if there was an express
provision in the Articles of Merger that as a condition for the
merger, BPI was being required to assume all the employment
contracts of existing FEBTC employees with the conformity of
the employees. In the absence of such a provision in the Articles
of Merger, then BPI clearly had the business management
decision as to whether or not to employ FEBTC’s emplyees.
FEBTC employees likewise retained the prerogative to allow
themselves to be absorbed or not; otherwise, that would be
tantamount to involuntary servitude.
 Marcopper and Adamson on protection to labor
When conflicting interests of labor and capital are to be weighed
on the scales of social justice, the heavier influence of the latter
should be counter-balanced by sympathy and compassion the law
must accord the underprivileged worker (Marcopper vs NLRC).
In interpreting the protection to labor and social justice provisions
of the Constitution and the labor laws or rules and regulations
implementing the constitutional mandates, we have always
adopted the liberal approach which favors the exercise of labor
rights should always be adopted (Adamson vs CIR).
 Central Bank Case on Equality
It is the fundamental policy of the State to promote social justice
in all phases of national development. Central bank pronounces
that equality is one ideal which cries out for bold attention and
action in the constitution.
The disparity of treatment between BSP rank-and-file and the
rank-and-file of the other seven Government Financial
Institutions definitely bears the unmistakable badge of invidious
discrimination - no one can, with candor and fairness, deny the
discriminatory character of the subsequent blanket and total
exemption of the seven other GFIs from the Salary
Standardization Law when such was withheld from the
BSP. Alikes are being treated as unalikes without any rational
basis.
Again, it must be emphasized that the equal protection clause
does not demand absolute equalitybut it requires that all
persons shall be treated alike, under like circumstances and
conditions both as to privileges conferred and liabilities
enforced. Favoritism and undue preference cannot be allowed.
For the principle is that equal protection and security shall be
given to every person under circumstances which, if not identical,
are analogous. If law be looked upon in terms of burden or
charges, those that fall within a class should be treated in the
same fashion; whatever restrictions cast on some in the group is
equally binding on the rest.
68. Century Canning Corp vs. Ramil -doubt or
ambiguity in evidence
The law mandates that the burden of proving the validity of the
termination of employment rests with the employer. Failure to
discharge this evidentiary burden would necessarily mean that the
dismissal was not justified and, therefore, illegal. Unsubstantiated
suspicions, accusations, and conclusions of employers do not
provide for legal justification for dismissing employees. In case
of doubt, such cases should be resolved in favor of labor,
pursuant to the social justice policy of labor laws and the
Constitution.
 COLEGIO DE SAN JUAN DE LETRAN VS VILLAS
In the case of Colegio De San Juan De letran v. Villas, the
Supreme Court found that the provisions of the Faculty Manual is
ambiguous as the term employment connotes a number of
meanings. Employment in its general sense connotes any work or
service in exchange for money. The loose connotation of
employment may therefore cover jobs without an employer-
employee relationship. However, inasmuch as in this case,
petitioner School drafted the said policy, the term “employment”
should be strictly construed against it. Moreover, it is settled rule
that in controversies between a labourer and his master,
doubts reasonably arising from the evidence, or in the
interpretation of agreements and writings should be resolved
in the former’s favour. The act of respondent in selling
insurance and cookware was not the “employment” prohibited by
the Faculty Manual. The prohibition against outside employment
was enacted to prevent the teacher from using the study leave
period for unsanctioned purposes since the School pays the
teacher while pursuing further studies. That rationale was not
violated by respondent for the reason that her part-time activity of
selling insurance and cookware could not have prevented her in
any way from studying and, more importantly, she was not being
paid by the School while on leave. How did the School expect her
and her family to survive without any income for one whole
year?
Philippine Long Distance Telephone Co., v. NLRC (page 6)
The Philippine Constitution, while inexorably committed towards
the protection of the working class from exploitation and unfair
treatment, nevertheless mandates the policy of social justice so as
to strike a balance between an avowed predilection for labor, on
the one hand, and the maintenance of the legal right of capital, the
proverbial hen that lays the golden egg, on the other. The
Supreme Court, in PLDT v. NLRC, underscored that although it
is bound by the social justice mandate of the Constitution and the
laws, such policy of social justice is not intended to countenance
wrongdoing.
International School Alliance case on inequality and
discrimination (page 21, Chan 2019)
International School Alliance of Educators (ISAE) vs.
Quisumbing, G.R. No. 128845, June 1, 2000
 In the workplace, where the relations between capital and labor
are often skewed in favor of capital, inequality and discrimination
by the employer are all the more reprehensible. Section 3
specifically provides that labor is entitled to “humane conditions
of work.” These conditions are nor restricted to the physical work
place – the factory, the office or field – but include as well the
manner by which employers treat their employees. The same
provision of the Constitution also directs the state to promote
“equality of employment opportunities for all.” Similarly, the
Labor Code provides that the state shall “ensure equal work
opportunities regardless of sec, race or creed.” It would be an
affront both to the spirit and letter of these provisions if the State,
in spite of its primordial obligation to promote and ensure equal
employment opportunities, closes its eyes to unequal and
discriminatory terms and conditions of employment.
Discrimination, particularly in terms of wages, is frowned upon
by the Labor Code. Article 133(135), for example, prohibits and
penalizes the payment of lesser compensation to a female
employee as against a male employee for work of equal value.
Article 259(248) declares it an unfair labor practice for an
employer to discriminate in regard to wages in order to encourage
or discourage membership in labor organization.
Interpretation of the Labor Code

Article 4 enunciates the time-honored principle that all doubts in

the implementation and interpretation of its provisions should be
resolved in favor of labor. This rule applies not only in the
interpretation of the provisions of the Labor Code but also of its
Implementing Rules.

It applies to all workers - whether in the government or in the

private sector - in order to give flesh and vigor to the pro-poor
and pro-labor provisions of the Constitution. It is in keeping with
the constitutional mandate of promoting social justice and
affording protection to labor. Thus, when conflicting interests of
labor and capital are to be weighed on the scales of social justice,
the heavier influence of the latter should be counterbalanced by
sympathy and compassion the law must accord the
underprivileged worker.

The Labor Code is one of the rare laws which expressly mandate
the appropriate rule of interpreting or construing its provisions.
This is one unique feature of the Labor Code. The rules on legal
hermeneutics applicable to most statutes are not followed.
Consequently, from the inception of a legal controversy or case,
labor has already an upper hand over the employer. Once the
doubt is not effectively overturned by clear and convincing
evidence expected to be propounded by the employer who, in
most cases, has the burden of proof, the controversy should by
clear directive of the law, be decided in favor of labor.

This is of course, is not a harsh rule. The framers of the law

(Labor Code and the Civil Code) had fully taken cognizance of
the disparity in terms of resources and standing between labor
and capital in any legal controversy between them, the former
always suffers the most. Hence, the common adage that those
who have less in life should have more in law is best exemplified
and made real in Articles 4 and 1702 of the Labor Code and Civil
Code respectively. The worker must look up to the law for his
protection. The law regards him with tenderness and even favor
and always with faith and hope in his capacity to help in shaping
the nation’s future. He must not be taken for granted.
Art. 1702, CC and Art. 4, LC, harmonized

Article 1702 of the Civil Code ordains that "In case of doubt, all
labor legislation and all labor contracts shall be construed in favor
of the safety and decent living of the laborer. Compared to the
provision of Article 4 of the Labor Code, it appears that Article
1702 is broader in scope in that it pertains to "all labor legislation
and all labor contracts" and not merely to the implementation and
interpretation of the provisions of one single code, the Labor
Code, as well as its implementing rules and regulations, as
enunciated in Article 4. Moreover, the Civil Code embodies a
standard which would justify the invocation of the labor-tilted
rule of interpretation in that the same should be done "in favor of
the safety and decent living for the laborer."

Having made such observation, it may well be said that the

provisions of the Civil Code and the Labor Code do not really
differ since the policy of the law is clear - any doubt should
always be interpreted or construed in favor of labor - which
means, in more specific terms the safety and decent living for the
laborer.
When Art. 4, LC does not apply

The provision that in case of doubt in the interpretation of the

provisions of the Labor Code, the doubt should be resolved in
favor of the laborer does not apply where the pertinent provisions
of the Labor Code leave no room for doubt either in their
interpretation or application. (Bonifacio v. GSIS, G.R. no. 62207,
Dec. 15, 1986, 146 SCRA 276)

The employer has the right to expect from the employee no less
than adequate work, diligence and good conduct. (Coca-Cola
Bottlers Philippines Incorporated v. NLRC, G.R. nos. 82580 &
84075, April 25, 1989, 172 SCRA 751; Firestone Tire and
Rubber Co. of the Phils. v. Lariosa, G.R. no. L-70479, February
27, 1987, 148 SCRA 187).
 3. Persons working in their respective homes in needle
work or in any cottage industry duly registered in accordance
Applicability of LC; excepted workers with law.

Employees covered:
The existence of employer-employee relationship is necessary.
Without this relationship, the Labor Code does not apply.
Applicable to all workers irrespective of the nature of their work,
that is whether it be agricultural or non-agricultural, whether
operated for profit or not.
Employees not covered:
Article 255 [245], Title V, Book V, which provides for the
ineligibility of managerial employees to join, assist or form any
labor organization.
Article 302 [287], Title 11, Book VI, which excepts from the
coverage of the retirement pay benefit, employees of retail,
service and agricultural establishments or operations employing
not more than ten (10) employees or workers.

The Labor Code has, in certain specified cases, excepted certain

groups of workers from the application of the rights and benefits
provided therein, such as the following:

Article 82, Title I, Book III, which excludes the following

workers from the coverage of the provisions on working
conditions and rest periods, more specifically on normal hours of
work, meal periods, night shift differential, overtime work,
weekly rest periods, holidays, service incentive leaves and service
charges:

1. Government employees;
2. Managerial employees;
3. Field personnel;
4. Members of the family of the employer who are
dependent on him for support;
5. Domestic helpers;
6. Persons in the personal service of another; and
7. Workers who are paid by results, as determined by the
Secretary of Labor in appropriate regulations.

Article 98, Title 11, Book III, which excludes the following
workers from the coverage of the provisions on wages:

1. Farm tenancy or leasehold;

2. Domestic service; and
4 Elements/tests of employeer-employee relationship

There is no uniform test of employment relationship but the four

(4) elements of an employer-employee relationship are as
follows:

(a) Selection and engagement of the employee;

(b) Payment of wages;

(c) Power of dismissal; and

(d) Employer’s power to control the employee’s conduct with

respect to the means and methods by which the work is to be
accomplished [Brotherhood Labor Unity Movement of the
Philippines et. al. v. Zamora, G.R. No. 48645, (1987)]

The most important element is the employer’s control of the

employee’s conduct, not only as to the result of the work to be
done, but also as to the means and methods to accomplish it.
[Lirio v. Genovia, G.R. No. 169757, (2011)].

The control test calls merely for the “existence” of the right to
control and not the “actual exercise” of the right. [Zanotte Shoes
v. NLRC, G.R. No. 100665, (1995)].

Not every form of control will have the effect of establishing ER-
EE relationship. The line should be drawn between:

(1) Rules that merely serve as guidelines towards the

achievement of mutually desired results without dictating the
means or methods to be employed in attaining it. These aim only
to promote the result. In such case, NO EE-ER relationship
exists.

(2) Rules that control or fix the methodology and bind or restrict
the party hired to the use of such means. These address both the
result and the means used to achieve it and hence, EE-ER
relationship exists. [Insular Life Assurance Co, LTD v. NLRC,
G.R. No. 84484, (1989)].
Two-tiered test as a better and more comprehensive test

TWO-TIERED APPROACH.

(1) First Tier: Control Test (refer to the Four-Fold Test)

(2) Second Tier: The underlying economic realities of the activity

or relationship. [Sevilla v. Court of Appeals, G.R. Nos. L41182-
3, (1988)].

The economic realities prevailing within the activity or between

the parties are examined, taking into consideration the totality of
circumstances surrounding the true nature of the relationship
between the parties. 

The benchmark of economic reality in analyzing possible

employment relationships for purposes of applying the Labor
Code ought to be the economic dependence of the worker on his
employer. 

The standard of “economic dependence” is whether the worker is

dependent on the alleged employer for his continued employment
in that line of business. [Orozco v. CA, G.R. No. 155207, (2008)]
Cases where employer-employee relationship is suspended, not
terminated

Note: Termination of employer-employee relationship will be

discussed separately

In the following cases, the employment relationship is deemed

suspended by express provisions of the Labor Code or its
implementing rules:

1. In case of preventive suspension of an employee who is

undergoing an administrative investigation for an offence
and his presence in the company premises poses a serious or
imminent threat to the life or property of the employer or of
his co-employees.
2. In case of imposition of punitive suspension as a form
of disciplinary penalty on an employee who is found guilty
of committing a wrongful act under Art 297 of the Labor
Code or under the Company Rules and Regulations.
3. During off-season, in case of regular seasonal
employment. The nature of the relationship of regular
seasonal workers with their employer is such that during the
off-season, they are temporarily laid off but they are re-
employed during next season or when their services may be
needed.They are not separated from the service but are
merely considered as on leave of absence without pay until
they are re-employed. Their employment relationship during
off-season is never severed but only suspended.
4. Under the following circumstances, Article 301 of the
Labor Code deems he employment relationship not
terminated but merely suspended:


o Bona-fide suspension by the employer of the
employer of the operation of his business or undertaking
for a period not exceeding 6 months;
o Fulfillment by the employee of a military duty;
or
o Fulfilment by the employee of a civic duty.