(SLU 2009) Labor Relations Reviewer

LABOR LAW REVIEWER
Labor Relations
S A I N T LO U I S UN I V E R S I T Y
College of Law
March 2009
EDITION
SAINT LOUIS UNIVERSITY
College of Law
BAR OPERATIONS COMMITTEE
(Team 2009)
KRIS DYAN CAYABYAB

Overall Chair
ARIZ CAWILAN
Vice Chair
Section Chiefs
RYAN SOLANO MYKEEDOX

Civil Law Section Criminal Law Section
MAAN BAGUIOEN LOUIE SAJONIA

Commercial Law Section Ethics Section
BRENSON SIADTO JED ALLAN BEJAR

Labor Law Section Political Law Section
NORWAYNE SALMAN BRENNER BENGWAYAN

Taxation Law Section Remedial Law Section
Adviser
ATTY. HILARIO JUSTINO F. MORALES

Head, Political Law Department
College of Law, Saint Louis University
LABOR LAW SECTION
Team 2009 Team 2008
BRENSON SIADTO Section Chief RACHELLE ANN LAZAGA

ANNA MARI ABARCAR Vice Chief ORLANDO TENORIO
Members
LORNA FERNANDEZ ANNA MARI ABARCAR
JOVILYN HIMOLDANG JOAN ACHAZO
SENCIA PANTALEON
CYNTHIA PUNGAYAN
AMBROSIO GANDEZA
ORLANDO TENORIO
G HAZEL BUNESS CANALE
FLORIMAE DANGLI
YAMINE LEE TADEO
CLIMARK DASAYON
AMBROSIO GANDEZA
Editorial Consultant & Adviser
ATTY. LEILANEE Q. DASIG – QUANGUEY

Professor
College of Law, Saint Louis University
Public Attorney
Public Attorneys’ Office, City of Baguio
W
LABOR LAW REVIEWER
Labor Relations
Copyright © 2009 Bar Operations Committee

College of Law
Saint Louis University
2600 Baguio City
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Labor Relations
ARTICLE 211
DECLARATION OF POLICY
1. to promote and emphasize the primacy of free collective bargaining and negotiations,
© 2009 BAR OPERATIONS COMMITTEE. Saint Louis University C OLLEGE OF LAW . All Rights Reserved| LABOR LAW SECTION (Team 2008; Team 2009) |
including voluntary arbitration, mediation and conciliation, as modes of settling labor
or industrial disputes;
2. to promote free trade unionism as and instrument of for the enhancement of

democracy and the promotion of social justice and development;
3. to foster the free and voluntary organization of a strong and united labor movement;
4. to promote the enlightenment of workers concerning their rights and obligations as

union members and employees;
5. to provide an adequate administrative machinery for the expeditious settlement of

labor and industrial dispute;
6. to ensure a stable but dynamic and just industrial peace;
7. to ensure the participation of workers in decision and policy-making process affecting

their rights, duties and welfare;
DEFINITIONS
WHO ARE EMPLOYEES?
The term EMPLOYEES shall include:
1. Any employee and shall not be limited to the employee of any particular
employer;
2. Any individual:
Ø whose work had ceased as a consequence of or in connection with any
current labor dispute; and
Ø who had not obtained any substantially equivalent and regular
employment.
WHO ARE EMPLOYERS?
EMPLOYERS are defined as, any person who employs the services of another, and one
for whom the employees work and who pays their wages and salaries. They may also be any
person directly or indirectly acting in the interest of an employer (SEE D. O. No. 40-03).
S AINT L OUIS U NIVERSITY | College of Law | B AR O P E R A T I O N S C O M M I T T E E (2009)

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I
JURISDICTION AND
PROCEDURE IN LABOR DISPUTES
LABOR DISPUTE
• Any matter or controversy concerning the terms and conditions of employment or the
association or representation of person in negotiating, fixing, maintaining, changing and
arranging the terms and conditions of employment, regardless or whether the disputants
stand in proximate relation of employer and employee.
Nature: Dispute arises from employer-employee relationship, although disputants
need not be proximately “employee” or “employer” of the other.
Subject Matter (Dispute Concerns)
• Terms or conditions of employment; or

• Association or representation of persons in negotiating, fixing, maintaining, or
changing terms or conditions of employment.
KINDS OF LABOR DISPUTES
Labor Standards Disputes
• Compensation
• Benefits
• Working conditions
Labor Relations Disputes
• Organizational Right Dispute/ULP

• Representation Disputes
• Bargaining Disputes
• Contract Administration or Personnel Policy Disputes
• Employment Tenure Disputes
• Inter-Union or Intra-Union Disputes
REMEDIES IN LABOR DISPUTES
• Grievance Procedure • Certification to NLRC

• Conciliation • Injunction
• Mediation • Judicial Action
• Enforcement or Compliance • Appeal
Order • Judicial Review
• Certification of Bargaining • Compromise Agreement
Representatives • Collective Bargaining
• Arbitration • Strike or Lockout
(Voluntary/Compulsory)
• Assumption of Jurisdiction

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II
NATIONAL LABOR RELATIONS COMMISSION
CREATION AND COMPOSITION
COMPOSITION
THE COMMISSION is composed of a Chairman and twenty-three (23) members.
§ EIGHT members shall be chosen only from among the nominees of the
workers and employers organization respectively.
§ The CHAIRMAN and SEVEN REMAINING MEMBERS shall come from
the public sector with the latter to be chosen preferably among the
incumbent labor arbiters.
(SEE R.A. 9347; June 24, 2006)
QUALIFICATIONS
• Chairman and other Commissioners
1. shall be members of the Philippine Bar;

2. must have been engaged in the practice of law in the Philippines for at
least 15 years;
3. with at least 5 years experience or exposure in the field of labor
management relations;
4. shall be preferably residents of the region where they shall hold office;
• Labor Arbiters
1. must be members of the Philippine Bar;

2. must have been engaged in the practice of law in the Philippines for at
least ten (10) years;
3. with at least five (5) years of experience or exposure in the field of labor
management relations;
APPOINTMENT
The CHAIRMAN, DIVISION PRESIDING COMMISSIONERS, and other COMMISSIONERS are

appointed by the President.
L ABOR ARBITERS are appointed by the President upon recommendation of the

Commission en banc.
TERM OF OFFICE
The MEMBERS OF THE COMMISSION and the L ABOR ARBITERS shall hold office
during good behavior until they reach the age of sixty-five (65) years unless sooner removed for
cause provided by law or become incapacitated to discharge the duties of their functions.

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JURISDICTION OF
LABOR ARBITERS
• Unfair labor practices cases / gross violation of CBA.

• Termination disputes.
• Money claims (arising from ER-EE relationship) regardless of amount, when
accompanied with a claim for reinstatement exceeds P5, 000.00, whether or not
accompanied with a claim for reinstatement. Exception: SSS / ECC / Medicare
claims.
• Claims for damages arising from employer-employee relations.
• Strikes and lockouts.
• Any or all of the above cases can, by agreement of the parties, be presented to and
decided with finality by voluntary arbitration of a panel of voluntary arbitrators.
Additional Cases:
• Money claims (arising from ER-EE relationship) or by virtue of any law or contract,
involving Filipino workers for overseas deployment, including claims for actual,
moral, exemplary and other forms of damages.
• Wage distortion disputes in unorganized establishments.
• Enforcement of compromise agreements when there is non-compliance by any of
the parties.
• Other cases as may be provided by law.
The original and exclusive jurisdiction of labor arbiters under ARTICLE 217 (c) for
money claims is limited only to those arising from statutes or contracts other than a CBA. The
labor arbiter has no jurisdiction over intra-corporate disputes.
ARTICLE 263 (g) empowers DOLE Secretary or the President of the Republic to
assume jurisdiction or refer the case to the NLRC if the labor dispute or impending strike or
lockout involves an industry indispensable to national interest.
III
JURISDICTION OF THE
NATIONAL LABOR RELATIONS COMMISSION
ORIGINAL JURISDICTION
• Cases certified to it for COMPULSORY ARBITRATION by the President or Sec. of Labor

and Employment pursuant to Arts. 263 and 264 of the LC;
• Cases on INJUNCTION pursuant to Arts. 218 and 264 of the LC; and
• CONTEMPT cases pursuant to Art.218 of the LC.
APPELLATE JURISDICTION
• Cases decided by the regional offices of the DOLE in the exercise of its adjudicatory
function pursuant to Art. 129 of the LC; and

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• Cases decided by the LAs pursuant to Art. 217(b) of the LC and see 10 of RA 8042
(overseas contract workers).
POWERS OF THE NLRC
• Rule-making Power
It has the power to promulgate rules and regulations governing:
F The hearing and disposition of cases before it and its regional branches;
F The hearing and disposition of cases pertaining to its internal functions;
F Those as may be necessary to carry out the purposes of the Code.
• Power to Issue Compulsory Processes

F Administer oaths;
F Summon parties; and
F Issue subpoenas ad testificadum and duces tecum.
• Power to Investigate and Hear Disputes within its Jurisdiction
F Conduct investigation for the determination of a question, matter or
controversy within its jurisdiction; and
F Proceed to hear and determine the disputes in the manner laid down under
paragraph (c) of Article 218.
F Conduct ocular inspection (Article 219).
• Contempt Power
F Hold any person in contempt directly or indirectly; and
ISSUANCE OF INJUNCTION OR
TEMPORARY RESTRAINING ORDER (TRO)
This power is reserved specifically to the NLRC however, the [1990] Rules of
Procedure of the NLRC, provides that ancillary power of issuing preliminary injunction or TRO
may be exercised by the Labor Arbiters only as an incident to the cases pending before
them in order to protect the rights of the parties during the pendency of the cases by excluding
labor disputes involving strikes or lockout.
Section 5 Rule XVI, Book V of the Implementing Rules of the Code, also allows Med-
Arbiters to do the same.
The power of the NLRC to enjoin or restrain the commission of any or all prohibited or
unlawful acts as provided in Article 218 of the Labor Code, can only be exercised in a labor
dispute.
REQUISITES:
1. The complainant must allege that a substantial and irreparable injury to his or
her property is inevitable, unless a TRO is issued without notice;
2. An Affidavit of Merit or a testimony under oath is filed; and
3. An Undertaking with Adequate Security or Bond is first filed, the amount of
which to be fixed by the Commission sufficient to recompense those enjoined for
any loss, expense, or damage, and to include all other reasonable costs, caused by
the improvident or erroneous issuance of such order or injunction.

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IV
JURISDICTION OF THE
BUREAU OF LABOR RELATIONS
The BUREAU OF L ABOR RELATIONS (BLR) and the L ABOR RELATIONS D IVISION in the
regional offices of the DOLE shall have original and exclusive authority to act, at their own
initiative or upon request of either or both parties, on the following:
• All inter-union conflicts;

• All intra-union conflicts; and
• All other related labor relations disputes
NOTE: The Bureau of Labor Relations no longer handles all labor management
disputes.
Inter-union dispute: any conflict between and among legitimate labor unions involving
representation questions for purposes of collective bargaining or to any other conflict
or dispute between legitimate labor unions.
Intra-union dispute: any conflict between and among union members, including
grievances arising from any violation of the rights and condition of membership,
violation or disagreement over any provision of the union’s constitution and by-laws, or
dispute arising from chartering or affiliation of union.
ADMINISTRATIVE FUNCTIONS OF BLR / LR DIVISION
• Regulation of registration of Labor Unions;

• Keeping of registry of labor unions; and
• Maintenance of a file of CBAs.
Notes:
• Concurrent jurisdiction of BLR and Labor Relations Division in each Regional office
of DOLE.
• Denial of application for registration in the regional office is appealable within 10
days to the BLR.
• Execution of the order of the Regional director shall be stayed pending appeal (IR:
Book 5, Rule XIV; Sec 8), in the exercise of its appellate jurisdiction.
• The decision of the Bureau shall be final and no longer subject of appeal (Sec. 7,
Ibid).
• The decision of the Bureau in its exercise of its original jurisdiction is appealable
to the Secretary of Labor and Employment (SOLE).
DEPARTMENT ORDER NO . 9 (Decisions on Intra Union Disputes), provides that

the appeal from the regional level must be made to the BLR Bureau Director, which
shall have the power to require the appearance of any person or the production of any
paper, document or matter relevant to a labor dispute under its jurisdiction (SEE ALSO
Art. 229).

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V
JURISDICTION OF
VOLUNTARY ARBITRATORS
ORIGINAL AND EXCLUSIVE JURISDICTION
To hear and decide the following:
• Disputes arising from interpretation or enforcement of company personnel

policies;
• Unresolved grievance arising from interpretation or implementation of a collective
bargaining agreement and those arising from the interpretation or enforcement of
company or personnel policies.
• Upon agreement of the parties, shall also hear and decide all other labor disputes
including unfair labor practices and bargaining deadlocks.
VI
JURISDICTION OF
VOLUNTARY ARBITRATORS
APPEAL
Period to File an Appeal
Decision or orders of the L ABOR ARBITER may be appealed to the NLRC by any
or both parties within 10 calendar days from receipt of such decisions or orders.
If the decision, resolution, or orders are made by the REGIONAL DIRECTOR of

the Department of Labor, appeal may be filed within five (5) calendar days from
receipt thereof.
The 10 or the five (5) day period should be counted not from the date of receipt
of the decision/order by a party but from the date of receipt by his lawyer. This is
mandatory but allows some exceptions.
Grounds for Appeal
• Prima facie evidence of abuse of discretion;

• Fraud or coercion including graft and corruption in securing the decision;
• Pure questions of law; and
• Serious errors in findings of facts causing grave or irreparable damage or
injury.

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Requirements for Appeal to the NLRC
• Appeal shall be filed within the reglementary period;

• It must be in the form of memorandum of appeal which shall state the
following:
§ Grounds relied upon and arguments in support thereof;
§ Relief prayed for; and
§ Statement of the receipt of the appealed decision, resolution or
order.
• It must be verified by the appellant himself;
• It must be in three (3) legibly typewritten or printed copies;
• It must be accompanied by the following:
§ Proof of payment of the required appeal fee;
§ Posting of cash or surety bond;
§ Certificate of non-forum shopping;
§ Proof of service to the adverse party.
The requirement of posting of bond, although jurisdictional, was given liberal
interpretation. The posting of real property bond was allowed as it sufficiently protects
the interests of the other party should the latter prevail. Its RATIONALE is that the
importance of deciding cases is based on substantive merit and not on strict
compliance of technical rules.
In cases of perfected appeals, the NLRC limits itself to reviewing issues which
were raised on appeal; the rest shall be final and executory.
VII
MOTION FOR RECONSIDERATION
A party is allowed to file a MOTION FOR RECONSIDERATION of any order, resolution or

decision of the NLRC based on palpable or patent errors, provided that the motion is under
oath and filed within 10 calendar days from receipt of the order, resolution or decision.
It is a pre-condition for pursuing any further or subsequent remedy; otherwise, the said
order, resolution or decision shall become final and executory after 10 calendar days from
receipt thereof.
The Requirement of a Motion for

Reconsideration may be dispensed
with, in the following instances:
• When the issue raised is one or purely of law;

• Where public interest is involved;
• In cases of urgency; and
• Where special circumstances warrant immediate or more direct action.
• Where the assailed decision was rendered without jurisdiction or in excess of
jurisdiction;
• Where, under the circumstances, filing a Motion for Reconsideration would be
useless.

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VIII
PETITION FOR CERTIORARI
(Under Rule 65, Rules of Court)
A party may avail of the CIVIL ACTION FOR CERTIORARI, where the tribunal, board, or
office exercising juridical functions:
• Has acted without or in excess of jurisdiction; and, or

• With grave abuse of discretion and praying that judgments be rendered annulling
or modifying the proceedings, as the law requires, of such tribunal, board or
officer.
It may be filed not later than 60 days from notice of the judgment, order, or resolution.
Both SC and CA have jurisdiction over the action; however, in line with the doctrine of
minatory of warts, the petition should initially be presented to the lower of the two courts, that
is, the CA.
IX
EXECUTION OF JUDGMENTS
A WRIT OF EXECUTION may be issued by the following officials for the final decisions,
orders or awards promulgated by them:
• Secretary of DOLE;
• NLRC;
• Any regional director;
• Any labor arbiter;
• Any med-arbiter;
• The voluntary arbitrator; or
• The panel of arbitrators.
It may be issued motu proprio or on motion of any interested party within five (5) years
from the date, it becomes final and executory.
REINSTATEMENT
• The decision of the LA reinstating a dismissed OR separated employee shall be

executory, even pending appeal.

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The employee shall either be:
§ Admitted back to work under the same terms and conditions

prevailing prior to the dismissal or separation; or
§ At the option of the employer, to be merely reinstated into payroll.
The posting of a bond by the employer shall not stay the execution of
reinstatement.
• The decision of the NLRC reinstating a dismissed employee is not self-executory.

Where no writ of execution was issued, the employee would not be entitled to
wages during the pendency of the case for review before the appellate courts.
VENUE
For purpose of venue, workplace shall be understood as the place or locality where the
employee is regularly assigned when the cause of action arose.
Work place shall include the place where the employee is supposed to report back after
a temporary detail, assignment or travel.
In the case of field employees, as well as ambulant or itinerant workers, their

workplace is where they are regularly assigned or where they are supposed to regularly
receive their salaries/wages or work instructions from and report the results of their
assignment to their employers.
Where two (2) or more regional arbitration branches have jurisdiction over the
workplace, the branch that shall first acquire jurisdiction over the case shall exclude the
others.
When improper venue is not objected before or at the time of filing of position papers,
such question shall be deemed waived.
The venue of an action may be changed or transferred by written agreement of the

parties, or when the NLRC or LA before whom the case is pending so orders upon motion by
the proper party in meritorious cases.
X
COMPROMISE AGREEMENTS
(Article 227, Labor Code)
F UNDAMENTAL POLICY OF P HILIPPINE L ABOR L AWS: preferential use of voluntary

modes of settling disputes since the maintenance of industrial peace is a joint responsibility of
the worker and the employer.
• Under Art. 227, any compromise settlement voluntarily entered into by the
parties with the assistance of the Bureau or the Regional Office of the DOLE
shall be FINAL and BINDING upon the parties.
• The NLRC or any courts shall not assume jurisdiction over issues involved in
the compromise agreements EXCEPT:

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§ In non-compliance; or
§ If there is prima facie evidence that the settlement was obtained through
fraud, misrepresentation or coercion.
FORMAL REQUIREMENTS
1. The compromise agreement must be reduced to writing; and
2. Signed in the presence of the Regional Director or his duly authorized

representative.
VALIDITY OF COMPROMISE
AGREEMENTS AND QUITCLAIMS
GENERAL RULE: The law looks with disfavor upon quitclaims end releases by EE’s who
are pressured into signing them by unscrupulous employers.
EXTENSION: Not all waivers and quitclaims are invalid as against public policy. If the
agreement was:
(1) Voluntarily entered into, and

(2) Represents a reasonable settlement, it is binding on the
parties.
• It must be duly authorized, as required by law. Attorneys and other

representatives of the parties shall have authority to bind their clients
in all matters of procedure but they cannot without SPA express
consent or enter into a compromise agreement with the opposing party.
WHEN TO EFFECT COMPROMISE: it may be effected at any stage of the proceedings

and even when there is already a final executory judgment.
REMEDIES FOR NON-COMPLIANCE:
1. Conference the compromise by a writ of execution; and

2. Regard it as rescinded and so insist upon the original demand.
XI
TERMINATION DISPUTES
ART. 279: SECURITY OF TENURE
§ It is the Constitutional right granted to the employee to be secured, or to continue

in employment until the same is terminated by virtue of a just cause or on grounds
authorized by law.
§ Security of tenure applies not only to actual dismissals but also applies if there is
constructive dismissal.
Coverage: extends to all types of employees

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CLASSIFICATION OF EMPLOYEES
• Regular
• Project
• Seasonal
• Casual
• Fixed-period or Contractual
• Probationary
Regular Employees
• An employee is deemed REGULAR where the employee:
§ Has been engaged to perform activities which are usually necessary

or desirable in the usual trade or business of the employer; or
§ Has rendered at least one year of service, whether continuous or
broken, with respect to the activity in which he is employed.
§ Even handicapped persons, employed for humanitarian reasons,

may become regular employees if they are doing necessary or
desirable jobs and their employment has exceeded six months
through renewal of their initial appointments (Bernardo Ruling).
§ Has been continuously employed beyond the period of

probationary, contractual, or project employment.
Project Employees
• A PROJECT EMPLOYEE is one whose employment has been fixed for a

specific project or undertaking, the completion or termination of which has
been determined at the time of the engagement of the employee.
§ Must be in good faith.

§ Service is coterminous with the project or phase of the project; and
§ Employer has no obligation to give him separation pay.
§ Termination of the project employment must be duly reported to
the nearest DOLE office.
• A PROJECT EMPLOYEE may acquire the status of a regular employee when the
following concur:
§ There is a continuous rehiring of project employees even after

cessation of a project; and
§ The task performed by the alleged project employee is vital,

necessary, and indispensable to the usual business or trade of the
employer.
Seasonal Employees
• A SEASONAL EMPLOYEE is one who is engaged to work during a particular

season in an activity that is usually necessary or desirable in the usual
business or trade of the employer.

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• But, during off-season, the employer-employee relationship is not severed.

The seasonal employee is merely considered on a leave of absence without
pay.
Casual Employees
• CASUAL EMPLOYEES are those employees engaged to work on an activity

that is not usually necessary or desirable in the usual business or trade of
the employer.
• If the casual employee has worked for at least one year – whether
continuously or broken – he becomes a regular employee.
Fixed-Period Employees
• Employee whose employment will last only for a definite period as agreed
by the parties.
• REQUISITES:
• The fixed period was knowingly and voluntarily agreed upon by

the parties.
• The employer and the employee dealt with each other on more
or less equal terms with no moral dominance being exercised by
the employee (Brent School Ruling).
• It is not valid if it is apparent that periods have been imposed to preclude

acquisition of tenurial security by the employee.
Probationary Employees
• One who is on trial by an employer during which the employer determines

whether or not he is qualified for permanent employment.
Period: limited to six (6) months
Exceptions:
§ When the parties to an employment contract agree

otherwise.
§ When the same is established by company policy.
§ When the same is required by the nature of work performed
by the employee.
Extensions
Extension should be done before the lapse of the six (6)-month period.
It may be terminated:
§ For a just and authorized cause;

§ When he fails to qualify as regular employee.
• Standards of employer should be made known to the person on trial at the

time of his engagement. Otherwise, he is deemed regular.

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• The employee who is allowed to work after a probationary period shall be

considered a regular employee by operation of law.
PRIVATE SCHOOL TEACHERS
REQUISITES for acquisition of permanent employment:
• Teacher is a full – time teacher;

• Must have rendered three consecutive years of service;
• Service must have been satisfactory.
DUE PROCESS
REQUISITES for due process under Article 277:
• Written notice together with grounds or offenses charged.
• Opportunity to be heard by means of a formal investigation.
• Subsequent formal and written notice of termination.
• Plus other requisites as may be provided by company handbooks in
addition to the first three.
Article 277 applies only to termination and not to disciplinary actions unless
provided by the company.
VALIDITY OF DISMISSAL
General Postulates of Validity
TERMINATION Substantial Procedural

= +
VALIDITY Validity Validity
SUBSTANTIAL Just or
VALIDITY = Authorized
Cause
PROCEDURAL Notice and

=
VALIDITY Hearing
PROCEDURAL VALIDITY
• NOTICE REQUIREMENT
The mere posting of notice on employee’s bulletin board is not sufficient.

Payment of one (1) month salary in lieu of notice is not valid.
If based on JUST CAUSES:
F The first notice must apprise the employee of the particular acts or
omissions for which his dismissal is sought; and
F The second notice, which informs the employee of the employer’s

decision to dismiss him, is served to the employee.

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If based on AUTHORIZED CAUSE:
F The employer should give both the worker and the DOLE written
notices 30 days prior to termination.
• HEARING
F A worker may answer allegations within a reasonable period from receipt

of the notice of dismissal.
F The employer shall afford the worker ample opportunity to be heard and to
defend himself with his representatives.
F Second notice informing the employee of his dismissal must be given after
due hearing.
PREVENTIVE SUSPENSION
It is imposed during the pendency of the investigation, if the worker’s continued

employment poses a serious and imminent threat to life and property of employer, or of his
co-employees.
Maximum Period: 30 Days
NOTE: After the 30-day period, the employer may extend preventive
suspension if he pays the wages and other benefits due to the
suspended worker.
Rule Pending Investigation:
PREVENTIVE S USPENSION is not punitive for the first 30 days, because it is

intended only for affording the management’s unhampered opportunity to
investigate; hence, the period of suspension is NOT COMPENSABLE.
Rule Pending Appeal:
PREVENTIVE S USPENSION is punitive already; hence, if exonerated, the

employee must be reinstated and COMPENSATED for the period of his
suspension.
Suspension beyond 30 days DOES NOT necessarily ripen to dismissal.
DOCTRINES ON DISMISSAL FOR

CAUSE WITHOUT PROCEDURAL
DUE PROCESS (PDP)
1. PRE-WENPHIL DOCTRINE
J/A ILLEGAL
+ (-PDP) =
CAUSE DISMISSAL

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2. WENPHIL DOCTRINE (FEB 8, 1989)
J/A VALID DISMISSAL +

+ (-PDP) =
CAUSE INDEMNITY
3. SERRANO DOCTRINE (JAN 27, 2000)
DISMISSAL, i. e., INEFFECTUAL +

J/A FULL BACK WAGES FROM THE TIME OF
+ (-PDP) =
CAUSE DISMISSAL TO FINALITY OF COURT’S
DECISION
4. AGABON DOCTRINE ( NOV 17, 2004)
VALID DISMISSAL + PAYMENT

J/A OF INDEMNITY (dependent
+ (-PDP) =
CAUSE upon the gravity of the
disregard to due process)
In the case of Serrano, the SC held that violation of the notice requirement
cannot be considered as denial of due process resulting in the nullity of the employee’s
dismissal for the following reasons:
(1) The due process clause of the Constitution is a limitation on

governmental powers and does not apply to the exercise of private
power.
(2) Notice and hearing are required under the Due Process Clause
before the power of organized society is brought to bear upon the
individual.
(3) The employer cannot really be expected to be entirely an impartial

judge of his own case.
• BURDEN OF PROOF
EMPLOYER has the burden of proving the lawful cause.
• DEGREE OF PROOF
S UBSTANTIAL EVIDENCE is considered sufficient. This means more than

a scintilla of relevant evidence; evidence which a reasonable mind might
accept as adequate to support a conclusion.
CONSTRUCTIVE DISMISSAL
INVOLUNTARY RESIGNATIO N resorted to when continued employment becomes

impossible, unreasonable, or unlikely; when there is a DEMOTION IN RANK or a DIMINUTION IN

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PAY;or when a CLEAR DISCRIMINATION, insensibility or disclaim by an employer becomes

unbearable to an employee.
An employee is deemed constructively dismissed where his status is changed from

regular to casual.
• Six (6) Months Rule
“Floating Status” beyond six months under Article 286 may also amount to
constructive dismissal.
• Indefinite Lay-off or Suspension
It is the non-acceptance of a returning employee after exhausting his leave

of absence.
VALID DISMISSAL
Art. 282: Termination by Employer (SGF-CO)
1. serious misconduct or willful disobedience to lawful orders;

2. gross and habitual neglect of duty;
3. fraud or willful breach by the employee of the trust reposed by his
employer;
4. commission of a crime; and
5. other analogous causes.
MANAGEMENT RIGHTS
a. Right to Manage
- Employer is free to regulate according to his own discretion and judgment,

EXCEPT as limited by special laws.
- QUALIFICATION: as long as it is exercised in good faith
ü For the advancement of the employers interest not for the purpose
of defeating or circumventing the rights of the employees under
special laws or valid agreements
- JOB CONTRACTING: consultation with the union is not necessary.
• Not unlimited; the prerogative is subject to well-defined legal

limitations
b. Right to Discipline
c. Right to Transfer Employees
- It is allowed PROVIDED:
i. There is no demotion in rank; and
ii. No diminution of salary, benefits, and other privileges.
- The employees’ security of tenure dies not give him vested right over the
position held.
REQUIREMENT:
i. Not unreasonable or inconvenient;

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ii. Not prejudicial to employee;

iii. No demotion in rank, diminution of salary, benefits and other
privileges.
d. Right to Demote
- It can be upheld so long as it is not tainted with unfair labor practice.
e. Right to Dismiss
- It is a measure of self-preservation;
- However, it is not absolute, it is exercised only:
i. on just and authorized causes; and

ii. subject to regulation of the state by virtue of its police power.
§ The preservation of the life of the citizens is a basic duty of
the state, more vital than the preservation of corporate
profits.
- For it to be valid:
i. the employer must show sufficient ground for dismissal; and

ii. observe procedural due process (service of notice to employee and
the DOLE).
- The expiration of tenure is not tantamount to dismissal and thus there is no
entitlement to separation pay.
JUST CAUSES OF TERMINATION
1. SERIOUS MISCONDUCT
- It is an improper or wrong conduct;
- Transgression of some established or definite rule of conduct, a forbidden
act, a dereliction of duty, willful in character and implies wrongful intent
and not mere error in judgment;
- It must be serious and in connection with the employee’s work.
*Immoral Conduct: It is a conduct, which is as willful, flagrant or shameless as to

show indifference to the opinion of good and respectable members of the
community that must likewise be gross.
**The factors attending the circumstance and company policies must also be
considered.
2. WILLFUL DISOBEDIENCE
Requisites:
a) Orders, regulations, instructions of the employer must be:
- reasonable and lawful;

- sufficiently known to employee;
- in connection with the duties which the employee had been
engaged.
b) Employee’s conduct must be willful or intentional; the willfulness
being characterized by a wrongful or perverse attitude.

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- Reasonableness has reference not only to the kind and

character of the directions or command but also to the
manner in which they are made.
- Disobedience must relate to substantial matters.
**Valid Transfers
- This right flows from ownership;
- In the interest of the efficient and economic operation of its business.
- LIMITATION: mala fides
• Employer CANNOT exercise the right if it is tainted or

vitiated by improper motive and is merely a disguised
attempt to remove or punish the employee sough to be
transferred.
- Demotion of an employee and his transfer to another place of work because
of his failure to observe proper diligence in his work, of his indolence,
habitual tardiness and absences do not constitute dismissal.
**Invalid Transfers
- The right to transfer personnel must be exercised without grave abuse of

discretion putting to mind the basic elements of justice and fair play.
**The transfer is INVALID if done:
q for and illicit or underhand purpose;

q to defeat the rights of the employees to self organization;
q to penalize the employee for union activities;
q to remove an undesirable employee;
q to remove an employee, without valid reason and valid purpose;
q to inconvenience to the employee.
§ This, however, does not necessarily invalidate a transfer order BUT
inconvenience caused by unreasonableness of the transfer order
makes the order itself invalid and disobedience thereof is not a
reason to dismiss the worker; and
§ Although mere inconvenience does not justify disobedience to a
transfer order, the order itself becomes flawed and unenforceable it
if fails the criteria of lawfulness and reasonableness.
§ It depends on the circumstances availing in each case.
**A transfer becomes unenforceable if coupled with or is in the nature of a

promotion, where the promotion is rejected by employee.
- There is no law that compels an employee to accept a promotion, as

promotion is in the nature of a gift or reward, which the person has the
right to refuse.
- A person cannot be punished if he was exercising a right.
TRANSFER PROMOTION
It is a movement from one

It is an advancement from one
position to another of
position to another with increase
equivalent rank, level or
of duties and responsibilities
salary without break of
accompanied by increase in salary
service.
Lateral movement. Scalar ascent.

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3. GROSS AND HABITUAL NEGLECT OF DUTIES

REQUISITES:
a) Neglect must be gross in character; and
b) It must be habitual.
THUS, single or isolated acts of negligence do not constitute a just cause

for the dismissal of an employee
- It is not necessary that the employer show that he has incurred

actual loss, damage or prejudice because of the employee’s conduct.
- It is sufficient that the gross and habitual neglect by the employee

of his duties TENDS to prejudice the employer’s interest.
- What is required of the employee is that of ordinary and reasonable

skill, care and diligence. He cannot therefore be discharged on the
ground of incompetency merely because he failed to employ the
highest degree of skill and care known in the trade UNLESS he is
specially contracted by reason thereof.
**Gross Negligence
- It is the want, absence of, or failure to exercise slight care or

diligence or the entire absence of care.
- It evinces thoughtless disregard of consequences without exerting

effort to avoid them.
**Abandonment
REQUISITES:
a. failure to report for work or absence without valid or justifiable

reason
b. clear intention to sever the employer-employee relationship
c. deliberate and unjustifiable refusal of the employee to resume his
work without intention of returning.
GENERAL RULE: The immediate filing of a complaint for illegal

dismissal negates abandonment.
EXCEPTION: If abandonment is disproved OR if there is valid waiver.
**Tardiness and Absenteeism
- Acts of insubordination coupled with habitual tardiness are sufficient

causes of termination.
- Consider the circumstances attending the tardiness or absence.
4. DISHONESTY, LOSS OF CONFIDENCE

- FRAUD: any act, omission, or concealment, which involves breach of legal
duty, trust or confidence justly reposed and injurious to another.
REQUISITES
a. fraud must be committed against the employer or
representative;
b. must be committed in connection with the employee’s work.

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NOTE: There must be SUFFICIENT EVIDENCE that en employee had been

guilty of a breach of trust or that his employer has ample reasons
to distrust him.
LOSS OF CONFIDENCE
- To be a valid reason: it must be genuine;
i. it must be related to the performance of duties of the

employee such as would show him thereby unfit to continue
working for the employer;
ii. must occupy a position of trust and confidence or to

positions where the employee is routinely charged with the
care and custody of employer’s money or property.
- Managerial employees and other employees occupying positions of

trust and confidence are entitled to security tenure, fair standards
and protection of labor laws.
***Proof Required
- proof beyond reasonable doubt is not necessary;
- it is sufficient that there is some basis for such loss of

confidence or if the employer has reasonable ground to
believe or entertain the moral conviction that employee
concerned is responsible for the misconduct.
GUIDELINES:
a. should not be simulated

b. should not be used as a subterfuge for causes which are improper,
illegal or unjustified
c. not arbitrarily asserted in the face of overwhelming evidence to the
contrary
d. must be genuine and not a mere afterthought
e. must hold a position of trust and confidence
f. good faith
5. COMMISSION OF A CRIME OR OFFENSE

- This must be committed against the person of the employer or against any
immediate member of the employer’s family.
***Immediate Family:
a. Spouse;
b. Ascendants;
c. Descendants;
d. Legitimate natural or adopted brothers and sisters;
e. Relative by affinity in same degrees; and
f. Those by consanguinity within the fourth civil degree;
- Conviction for a crime is not necessary before the employee may be

dismissed.
- An employee exonerated from the criminal charge may be dismissed from

employment if the employer has ample reason to mistrust him.
- If acquittal from the offense does not negate the existence of a ground for
loss of trust and confidence, with more reason should conviction fortify the
mistrust.

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6. ANALOGOUS CAUSES
- This would depend on the circumstances of each case.
- The cause must be due to the voluntary and/or willful act or omission of
the employee.
AUTHORIZED CAUSES
ART.283: an employer may terminate the employment of the employee due to the
following: (IRRC)
1. introduction of labor-saving devices

2. redundancy
3. retrenchment to prevent losses
4. closing or cessation of operation
Other Authorized Causes
- total and permanent disability

- disease not curable in six (6) months
- valid application of union security clause
- expiration of period in term employment
- completion of project in project employment
- failure in probation
- defiance of return to work order
- relocation
- commission of illegal acts in a strike
- resignation retirement
- death
• To terminate the employment under Art. 283, the employer must serve a
written notice at least one (1) month before intended termination to:
- Employee, and
- Department of Labor and Employment.
• Payment of separation pay (SP):
- IF the cause is due to installation of labor saving devices:

ü SP equivalent to at least one (1) month pay or to at least one
month pay for every year of service
- IF in case of retrenchment/closure or cessation of business:
ü SP equivalent to one (1) month pay or at least one half
month pay for every year of service.
• An employee whose employment is terminated due to any causes under

Article 283 except closure or cessation due to serious losses is entitled to
separation pay.
1. INTRODUCTION OF LABOR SAVING DEVICES

- Reduction of the number of workers in a company by the introduction of
labor saving devices is justified.

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- It must not be abused and should not be made in the pretext for easing out
laborers because of their union activities.
REQUIREMENTS:
1. The installation of labor saving devices must be done in good faith.

2. There must be some valid purpose.
3. There must be due notice.
4. There must be fair and reasonable criteria.
5. There must be payment of separation pay.
6. There is no other remedy available at the option of the employer.
2. REDUNDANCY
- It exists where the services of an employee are in excess of what is
reasonably demanded by the actual requirements of the enterprise.
- A position is superfluous.
REASONS:
i. over hiring of workers;

ii. decreased volume of business; and
iii. dropping of a particular product line.
- It is of no legal moment that the financial troubles of the company were not
of private respondent’s making.
- The determination of the existence of redundancy is not subject to the
review of the Labor Arbiter or the NLRC, EXCEPT if it is exercises
arbitrarily and maliciously.
3. RETRENCHMENT
- This is one of the economic grounds to dismiss employees and is resorted
to by an employer primarily to avoid or minimize business losses.
- The employer bears the burden to prove his allegation of economic or
business losses.
- The termination of employment of an employee arising from retrenchment
to prevent losses shall entitle the employee affected thereby to separation
pay equivalent to one (1) month pay or at least one-half (½) of a month pay
for every year of service whichever is higher.
- Retrenchment is recognized as a preventive and curative measure.
CAUSES
- Lack of work; where the continuance of the work of the employee is
patently inimical to the interest of the employer.
- Business recession.
- Fire.
- Conservatorship contemplates not the liquidation of the company
involved but the conservation of company assets and business during the
period of stress.
CRITERIA FOR L AYING-OFF

- Less preferred status;
- Efficiency rating;
- Seniority.

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BASIC REQUISITES:
1. It is necessary to prevent losses and such losses are proven.

2. Written notice to employees and to the DOLE at least one month prior to
the intended date of retrenchment.
3. Payments of separation pay equivalent to one (1) month pay or at least a
half (½) a month pay for every year of service.
4. Exercise of the prerogative to retrench employees in good faith for the
advancement of its interests and not to defeat or circumvent the
employee’s security of tenure.
5. Employer must use fair and reasonable criteria in ascertaining who will be
dismissed or retained.
S TANDARDS WHICH JUSTIFY RETRENCHMENT

(Lopez Sugar Co. vs. Federation
of Free workers, August 30, 1990)
1. The losses expected should be substantial and not merely de minimis in
extent.
2. The substantial loss appended must be reasonably imminent, that is,
perceived objectively and in good faith by the employer. There must be a
certain degree of urgency for retren chment.
3. It must be reasonably necessary and effectively prevent the expected
losses. The employer should have taken other measures prior to or parallel
to retrenchment to forestall losses.
4. The alleged losses if already realized and the expected imminent losses
sought to be forestalled must be proven by sufficient and convincing
evidence.
• QUITCLAIMS: Even if there is the signing of quitclaims it will not by itself bar
them from enjoining the complaint. Quitclaims executed by laborers are
commonly frowned upon as contrary to public policy and ineffective to bar
claims.
• LIFO RULE (last in-first out)
The rule indicates that of two (2) or more employees affected by a

retrenchment program, the last one employed will be the first to go; seniority
of the ones hired earlier thereafter prevails.
Distinction; Redundancy from Retrenchment
Redundancy Retrenchment
Linked with losses
Results from the fact that
As to the position has became A cost cutting measure made
cause superfluous, in excess of immediately necessary by
what is needed. business reduction or
reverses.
As to
Separation pay is higher. Separation pay is lower.
effect
4. CLOSURE OF BUSINESS OR CESSATION
REQUIREMENTS:
a. Service of a written notice to the employees and to the DOLE at
least one month before the intended date thereof;

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b. Cessation of or withdrawal from business operations must be bona

fide in character; and
c. Payment to the employees of termination pay amounting to at least
half (½) a month pay for each year of service or one month
whichever is higher, where closure is not due to serious business
losses.
RIGHT TO CLOSE W HETHER L OSING OR NOT
- If the business is not losing but its owner, for reasons of his own wants to
get out of business, he in good faith can do so anytime. No law forces
anyone to go into business; no law compels anybody to stay in business.
But the employees must be paid their severance pay.
- In case of closure due to serious business losses, the employee is not

entitled to termination pay. However, the serious losses must be duly
proven.
ARTICLE 284: D ISEASE AS GROUND FOR TERMINATION
Conditions:
1. Employee is suffering from a disease.
2. His continued employment is prohibited by law or prejudicial to his

health or to the health of his co-employees.
3. There must be certification by a public health authority that the

disease is of such nature or at such stage that it cannot be cured
within a period of six (6) months even with proper medical
treatments.
NOTE: A company’s own physician is NOT a competent

public health authority.
4. Payment of separation pay equivalent to at least one (1) month

salary or to one-half (1/2) month for every year of service
whichever is greater.
NOTE: A fraction of six months is considered as one year.
• If there be finding that the termination was illegal, the terminated employee
may either be:
a. Reinstated to his former position without loss of seniority rights; OR
b. Recovery of back wages.
NOTE: These twin remedies are distinct and separate. Though the grant of
reinstatement commonly carries with it the award of back wages, the
inappropriateness or non-availability of the one does not carry with it
the inappropriateness or non-availability of the other.
• “STRAINED RELATIONS”: Where the relationship of the employee and the

employer has been severely strained by reason for their respective imputations of
bad faith against each other, to order reinstatement would no longer serve any
prudent purpose. In such situation, the court would order the payment of back
wages and separation pay, instead of reinstatement.
LIMITATIONS: It must be proven that the employee concerned occupies a

position where he enjoys the trust and confidence of his employer, and
that it is likely if reinstated an atmosphere of antipathy and antagonism
may be generated as to adversely affect the efficiency and productivity
of the employee concerned (Globe-Mckay, March 3, 1992).

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• MORAL DAMAGES are recoverable in dismissal cases only where the dismissal
was attended by bad faith, fraud or constituted as an act oppressive to labor, or was
done in a manner contrary to morals, good customs or public policy (Garcia, 234
SCRA 632).
ARTICLE 285: TERMINATION BY EMPLOYEE
Grounds: (SICO)
1. Serious insult by the employer or his representative on the honor and

person of the employee.
2. Inhuman and unbearable treatment.
3. Commission of a crime or offense by the employer or his representatives

against the person of the employee or any of the immediate members of his
family.
4. Other causes analogous to any of the foregoing.
RESIGNATION
It is defined as the act of an employee who finds himself in a situation where

he believes that personal reasons cannot be sacrificed in favor of the exigency of the
service and he has no other choice but to disassociate himself from his employment.
Two Kinds of Resignation
• Voluntary Resignation
This is beyond the control of the employer.
Where the employees voluntarily signed the resignation letters

apparently prepared by the company, the same are VALID.
Where the employee voluntarily resigned and signed the

quitclaim after receiving all the benefits, resignation is VALID
and BINDING.
The resignation may be withdrawn even if the employee has

called it “irrevocable.”
After its acceptance or approval by the employer, its withdrawal

needs the employer’s consent.
Filing of a certificate of candidacy by an employee of

government-owned-or-controlled corporation constitutes a
lawful cause for terminating employment relationship initiated
by the employee himself, and he is considered resigned by
operation of law (Omnibus Election Code).
Requirements:
1. Resignation may be with or without a just cause.

2. Service of written notice on the employer at least a
month in advance.
3. Acceptance by the employer or authorized
representative.

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General Rule: An employee who voluntarily resigns from

employment is not entitled to separation pay.
Exception: There can be entitlement to separation pay if:
1. there is a stipulation of such in the employment

contract ;
2. provided in the collective bargaining agreement;
3. payment of the amount is sanction by established
employer practice or policy.
• Forced Resignation or Constructive Dismissal
Burden of Proof (SICO)
The burden of proving that the questioned dismissal is for a just

or authorized cause and with due process is upon the employer.
F If the ground for quitting is SICO, the burden is on
the employee because the employer cannot be
required to prove SICO; otherwise, he would
incriminate himself.
F If the ground is transfer, the burden of proving that

the transfer is for valid and legitimate grounds rests
with the employer.
Between a positive allegation and a negative allegation, the

former is preferred.
ARTICLE 286: W HEN EMPLOYMENT DEEMED NOT TERMINATED
“FLOATING STATUS”
1. Bona fide suspension of the operation of the business or undertaking not

exceeding six (6) months;
2. Fulfillment of the employee or a military or civic duty.
NOTE: If the floating status lasts for more than six months, the employee may
be considered to have been illegally dismissed from the service.
ILLEGAL DISMISSAL
DEFENSES OF EMPLOYER IN ILLEGAL TERMINATION DISPUTES
1st LINE DEFENSES
• Complainant is an INDEPENDENT CONTRACTOR (I. C. Defense)
An employer who interns into a contract with a contractor to

perform work for the employer does not thereby create an
employer-employee relationship between him and the
employee of the contractor.
Contracting is legitimate if the following circumstances concur:

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F The contractor carries on a distinct and independent

business and undertakes to perform the job, work or
service on its own account and under its own
responsibility according to its own 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.
F The contractor has substantial capital or investment.
F The agreement assures the contractual employees’

entitlement to all labor rights and benefits.
• Complainant is an AGENT (Agent Defense)
ü Complaint is the representative of the employer.
ü There is absence of control.
ü There are indicators of absence of control.
F Complainant is paid commission;
F Subject to rules and regulations regarding outcome of work;
F Required to put up a performance bond;
F Not required to observe hours of work;
F Not required to devote his time exclusively to the company

(de Los Reyes Test);
F Time and effort depend entirely on his will and initiative

(Basiao Test);
F Not required to account for his time or submit record of his

activities;
F Required to liquidate and pay his account at the end of each

day;
F Contract may be terminated at the option of either party;
F Complainant can employ his own helpers at his personal

expense.
• Complainant is a CONSULTANT (Consultant Defense)
Complaining physician is not a member of the respondent

hospitals’ “Specialist Staff,” therefore, not under the employer’s
control.
• Complainant is a F REE L ANCE OPERATOR (Operator Defense)
Power of control is absent.
• Complainant is a L ESSEE (Boundary System Defense)
In the Jardin Case (February 23, 2000) the taxi or jeepney

drivers under the “boundary” system are employees of the taxi
or jeepney owners / operators; so also are the passenger bus
drivers and conductors.

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• Complainant is not under the Respondent’s Control
The right of control is not reserved.
• Complainant, by Contrary Stipulation, is NOT AN EMPLOYEE

(Contrary Stipulation Defense)
If the contract is one of the CHOICES, there is no employer-

employee relationship.
It is one of ADHESION; there is employer-employee

relationship
NOTE: Employer-Employee Relationship is a question of law

and, therefore, it cannot be made the subject of
agreement.
• Complainant is the EMPLOYEE OF A JOB CONTRACTOR
The circumstances for a job contracting to be legitimate must
concur in order for the employer to avail of this defense.
Otherwise, no employer-employee relationship. The contractor

is the project owner’s agent (only contracting labor).
• No Successor Employer Defense
The principle of Piercing the Veil of Corporate Fiction applies

only for the purpose of making corporate liability a personal
liability of the incorporators as corporate officers; not the
reverse.
Instrumentality Rule
Where one corporation is so organized and controlled

and its affairs are conducted, so that it is in fact a mere
instrumentality or adjunct of another, the fiction of the
corporate entity of the “instrumentality” may be disregarded.
Principle of Absorption
It only applies when there is an express agreement. If

there is bad faith, the employees remain to be employees of the
successor employer
• No Employment Contract Defense
No substantial evidence to prove that an employment contract

exists.
No written contract defense unavailing.
NOTE: If there is a stipulation against Employer-Employee

Relationship, it must be struck down as contrary to law.
• Unregistered Employer Defense
NOTE: Non-registration of an association does not negate

employment relations.
• Contract-Laborers Defense

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• Complainant is a PIECE-RATER
NOTE: Payment by piece is just a mode of payment and does

not change the essence of the relation.
2nd LINE DEFENSES
• Employer-Employee Relationship is Admitted but:
F Complainant is a PROJECT EMPLOYEE
PRINCIPLE OF SUSPENSION OF WORK
The period during which there is no project to

perform is NON-COMPENSABLE under the PRINCIPLE
OF NO WORK NO PAY.
If for a particular project, there is no tenure
EXCEPT : (1) if continuously re-hired; (2) member of the
work pool.
Members of the work pool if considered

employee of the construction company while in the
work pool, are non-project employees or employees for
an indefinite period.
The completion of the project or any phase

thereof will not mean severance of employer-employee
relationship.
N.B.: If not completed, the complainant cannot

be terminated even if contract has already expired.
Therefore, what counts is NOT EXPIRATION BUT
COMPLETION.
If the complainant was hired to carry out a

specific project or understanding that is within the
regular or usual business of the respondent, but which is
distinct, separate, and identifiable (DSI) as such, from
the other undertakings of the company, he is a project
employee.
If he was hired to do a job not within the regular

or usual business of the respondent, which is identifiably
separate and distinct and begins and ends at determined
or determinable times, he is a regular employee.
One (1) Year Rule (Art. 280)
It applies only to casual employees and not to

project employees especially if: (1) the gaps between
their employment is lengthy; (2) they had been
terminated upon completion of each project.
F Complainant is under a TEMPORARY EMPLOYMENT

CONTRACT

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The completion of the project and the names of the

employees terminated must be reported to DOLE to make
the defense tenable.
F Complainant is a CONTRACTUAL EMPLOYEE / TERM

EMPLOYEE
Complainant must not have rendered more than

one (1) year of continuous or broken service with respect to
the activity in which he is employed.
• Not Yet Regular (“Regular Contractual” Defense)
A CBA provision stating that employees are classified first as

regular contractual and not yet entitled to CBA benefits except
when they are promoted or regularized is VOID.
F Complainant is employed on a “PER NEED” Basis.
There must be no reasonable causal connection between
the particular activity performed by the complainant and
the usual business or trade of the respondent.
F Complainant is a consultant whose term is Co-Terminus

with Project.
Indicators that the work is NOT co-terminus with

project: (1) portion of contract that says “contingent upon
progress accomplishment;” (2) the contract gives the
respondent the right to determine the personnel and their
number as the work progresses.
F Complainant is NOT in the Payroll.
THEORY OF “ON LEAVE WITHOUT PAY” EMPLOYEES
The fact that workers are not regularly maintained in

the payroll and are free to offer their services to other
companies, when there are no projects, cannot defeat their
status of regularity. The cessation of construction activities at
the end of every project is foreseeable suspension of work. The
employment relation is NOT SEVERED. The employees are
strictly speaking not separated but simply ON LEAVE
WITHOUT PAY until they are re-employed. It does not denote
project employment.
F Complainant is a PROBATIONARY EMPLOYEE (Expiration

Defense).
CONTRACT OF ADHESION RULE
If the contract is ambiguous, interpret it in favor of

regular employment status.
Complainant must be properly apprised of the

reasonable standards for regularization and he failed to meet.
Due process must be observed.

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• Prescription
ü 4 years – Illegal dismissal

ü 3 years – Money claims
• Res judicatat or Failure to Prosecute
Non-submission of position papers
• Improper Venue
Substantial justice requires that workers who are economically

disadvantaged must litigate before the nearest governmental
machinery to hear and resolve the dispute.
REMEDIES / RELIEFS FOR
ILLEGAL DISMISSAL
The normal consequences of a finding of illegal dismissal are:
• Immediate reinstatement; and

• Payment of full back wages (REFER TO ART . 279).
NOTE: Take note that damages and attorney’s fees are not mentioned.
Therefore, the rule to apply is: what is NOT alleged, prayed for, and
proven CANNOT BE AWARDED. On the other hand, even if not
expressly prayed for, back wages and reinstatement can be ordered
because their basis is the law.
The two forms of relief are distinct and separate, one from the other. Though the
grant of reinstatement commonly carries with it an award of back wages, the
inappropriateness or non-availability of one does not carry with it the inappropriateness or
non-availability of the other. There may be reinstatement without back wages, or back wages
without reinstatement. But either requires a finding of illegal dismissal.
REINSTATEMENT
Restoration to a state from which one has been removed.
Employment for another is not a waiver of the right to reinstatement as it was

done in the fulfillment of the worker’s obligation to minimize damages as a
result of his unjustified dismissal.
If the position previously occupied has already been filled up, the proper
remedy would be to reinstate the dismissal employee to a SUBSTANTIALLY
EQUIVALENT POSITION.
However, the fact that the dismissal employee has already been replaced does
not affect his right to reinstatement. The other workers hired are deemed to
have accepted their employment as replacements with the knowledge the same
is subject to the consequences of the labor dispute.
An employee who, at the time of his dismissal was occupying a temporary or

lower position cannot be ordered reinstated to a permanent or higher position.

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GROUNDS FOR SEPARATION PAY

IN LIEU OF REINSTATEMENT
• Reinstatement can no longer be effected in view of the LONG PASSAGE OF

TIME or because of the realities of the situation.
• It would be INIMICAL to the employer’s interest.
• Reinstatement may no longer be FEASIBLE.
• It will not serve the best INTERESTS of the parties.
• The company would be PREJUDICED by the workers’ continued

employment.
• It will not serve the prudent purpose as when SUPERVENING facts have
transpired which make execution unjust or inequitable.
• There is a resultant STRAINED RELATIONS or irretrievable estrangements
between the employer and the employee where the employee concerned
occupies a position of trust and confidence and it is likely that if reinstated
an atmosphere of antipathy and antagonism may be generated as to
adversely affect the efficiency and productivity of the employee.
Reinstatement will not be insisted upon if it is shown that the employee

was dismissed for valid and sufficient reason although the dismissal
procedure was defective.
REINSTATEMENT IMMEDIATELY
EXECUTORY
Under Art. 223, the decision of the Labor Arbiter reinstating a dismissed
employee is immediately executory even while the case is brought up on
appeal.
There must be Immediate execution even without a writ of execution.

However, the employer is granted the OPTION to merely reinstate the
employee in the payroll and is entitled to receive her salary and other benefits
as if she were working.
NOTE: Under Art. 224 (a), a Writ of Execution is needed for a judgment of
reinstatement by the NLRC after it becomes final and executory.
CIRCUMSTANCES THAT
BAR REINSTATEMENT
• Dismissal for Cause
An employer should not be compelled to allow an employee to

continue in the service where a justifiable cause for his discharge exists.
• Abandonment of Right or Laches
An employee entitled to reinstatement may waive such right by his

failure to report for work when he had the opportunity to do so.

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If he avails of it within the four (4)-year prescriptive period for

reinstatement, the doctrine of laches does not apply.
• Resignation of the Employee
Where an employee has resigned, he has no right whatsoever to any

financial assistance, separation pay, and to reinstatement, predicated
on the fact that resignation brings separation from the service is on a
VOLUNTARY basis, that is, WITHOUT COERCION OR COMPULSION.
• Physical Incapacity of Employee
The employer may require employee to undergo physical or medical

examination, but it would NOT be imposed as a pre-condition for
reinstatement. If they were found to be ill or suffering from some
disability, they would be entitled to all benefit given to other employees
similarly situated.
If the reinstatement is no longer feasible, the proper remedy is
separation pay.
• Employee Accepts Retirement Pay

Retirement pay has the characteristic of separation pay, thus the
employee loses his right to reinstatement.
If the employee had reached the mandatory age of retirement,

reinstatement is no longer feasible. He should be awarded his back
wages.
• Strained Relations
This accord an employee back wages and separation pay. This is so

especially if the position of employee was one of trust and confidence.
• Closure or Cessation of Operation
Because of:
F Business reverses.
F Acts of the State.
• Transfer of Business to an Innocent Transferee
Unless expressly assumed, labor contracts being in personam, should

not affect a transferee acting in GOOD FAITH.
The transferor in MALA FIDE is required to pay dismissed employees a

reasonable month’s wages to tide them over while looking for suitable
employment.
It is applicable only when the transferee is an entirely new corporation

with a distinct personality from the integrating firms, and not when it is
found to be a mere ALTER EGO of the merging firms.
• Economic Reverses
Reinstatement is not feasible in order to give employment to a greater

number of persons that what is reasonably demanded by the actual
requirements of the business.

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• Abolition of Position
• Prescription
An action for illegal dismissal prescribes in four (4) years. Therefore, it

follows that an action for reinstatement also prescribes in four (4) years
(Article 1146, New Civil Code).
• Conviction for a Crime
An employee’s conviction is a supervening cause that renders unjust

and inequitable a decision mandating reinstatement with back wages.
• Not Conducive to Industrial Harmony

An illegally dismissed managerial employee on probationary status
cannot be reinstated.
“WITHOUT LOSS OF
SENIORITY RIGHTS”
Seniority
Length of service of employees in a specified unit for the purposes of
determining the order, in which workers will be laid-off, promoted, transferred,
or rehired.
Seniority right acquired through long-time employment is

CONTRACTUAL and NOT CONSTITUTIONAL.
Benefits, including seniority rights and other privileges, will not be

affected by the employee’s absence, due to suspension of employment brought
about by the unlawful dismissal.
BACK WAGES
Back Wages; Illegal Termination
Back wages are of a form of relief that restores the income of the
employee that was lost due to the unlawful dismissal.
Nature
It is not a private compensation or damage but in furtherance and

effectuation of the public objectives of the Labor Code. It is in the nature of a
command to make public reparation.
Formula in Fixing the

Amount of Back Wages
• MERCURY DRUG RULE (1974)
The rule limits back wages of illegally dismissed

employees to an amount equivalent to their wages for 3 years
without qualification and deduction.
Also known as the three (3)-year rule.
• R.A. No. 6715 (1989)

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It required the payment of “full back wages”;

ABANDONED the Mercury Drug Rule.
In the case of Maranaw Hotel vs. CA (November 6, 1992)

the Court initiated the rule that an illegally dismissed employee
may be paid his back wages, allowances, and other benefits for
the entire period he was out of work, subject to deduction of any
amount which the employee may earned during the period of
his illegal termination.
This ruling says “FULL BACK WAGES BUT WITH

DEDUCTIONS”
Justice Padilla dissented saying back wages with

deductions are not “full.”
• BUSTAMANTE RULING (November 28, 1996)
Back wages awarded to an illegally dismissed employee
should not, as a general rule, be diminished or reduced by the
earnings derived by him elsewhere during the period of his
illegal dismissal. The full back wages without deductions serve
as part of the price or penalty the employer must pay for
illegally dismissing the employee.
Back Wages; Termination

without Due Process
Serrano Doctrine
The Serrano Ruling upheld the validity of the employment

termination insofar as its reason is concerned but the employer was at
fault in not observing procedural due process. The penalty would be full
back wages from the time of termination to the finality of the court’s
decision.
Terminations which are illegal for lack of procedural process are

“INEFFECTUAL”.
Circumstances that Bar the

Award of Full Back Wages
• Death, Physical, or Mental Incapacity

It has the same underlying principle with the principle of “no
work; no pay”. This is also applies where employee refuses to
work.
• Business Reverses
Cessation or closures of business due to economic reverses
DOES NOT entitle a separated employee payment of back
wages, but only separation pay.
• Act of the State

Such as proclamation of Martial Law.
• Detention in Prison

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The detention caused the prolonged absence that barred him to

earn wages.
Back Wages of
Irregular Workers
The wages earned by other irregular workers doing the same kind of
work, who have not been dismissed, would be the basis in determining the back
wages of dismissed irregular workers.
SEPARATION PAY
It is the amount that an employee receives at the time of his severance

from the service and is designed to provide the employee with the wherewithal
[or finances] during the period that he is looking for another employment.
Separation pay is payable to an employee whose services are validly
terminated for authorized causes (Article 283 and 284).
An employee dismissed for a just cause is not entitled to separation pay

(Article 282).
EXCEPTION:
Where the employee is dismissed for causes other than serious

misconduct or those reflecting on his moral character, separation pay may be
allowed as a measure of social justice.
AMOUNT TO BE AWARDED
• Installation of Labor-Saving Devices and Redundancy

At least one (1) month pay or at least one (1) month pay for every year
of service, whichever is higher.
The employer is richer.
• Retrenchment to Prevent Losses and Closure or Cessation of Operations

Not Due to Serious Business Losses or Financial Reverses
One (1) month pay or at least half (½) a month pay for every year of
service whichever is higher.
Employer is poorer
• Disease
One (1) month salary or half (½) a month pay for every year of service,
whichever is greater.
A fraction of at least 6 months shall be considered one (1) whole year.
NOTE: If closure is due to SEVERE Financial Losses, it is still debatable

whether separation pay should be given.
If it is proven that 10% of the capital investment has been impaired, the
employer should be exempt for the payment of separation pay.

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The grant of separation pay and at the same time upholding the validity
of QUITCLAIMS and RELEASE are not at all incongruous.
Allegation of non-payment of benefit to which an employee is entitled

is a negative allegation. The BURDEN OF PROVING that such benefit has been
paid rests upon the EMPLOYER.
Where the debtor (employer) introduces some evidence of payment,

the BURDEN OF GOING FORWARD with the evidence -- as distinct from the
general burden of proof – is shifted to the creditor (EMPLOYEE) who is then
under obligation to show non-payment.
DAMAGES
NORMAL DAMAGES are recoverable in dismissal cases only where

the dismissal was attended by BAD FAITH or FRAUD or constituted an act
oppressive to labor, or was done in a manner contrary to morals, good customs,
or public policy.
EXEMPLARY DAMAGES in dismissal cases may be awarded only if

the dismissal was effected in a wanton, oppressive, or malevolent manner.
Article 217 is comprehensive enough to include all forms of damages

arising from employer-employees relationship. The clause “arising from the
employer-employee relations” should apply with equal force to the claims for
damages filed by employees as well as to the claim of an employer, where the
basis for the claim arises from or is necessarily connected with the fact of
termination. The claim for damages by the employee is in the nature of a
COUNTERCLAIM in the illegal dismissal case.
For failure to observe the procedural requirements, a sanction may be

imposed by the court on the employer to indemnify the dismissed employee.
INDEMNITY FOR
HOUSE HELPERS
If the house helper is unjustly dismissed, he or she shall be paid the

compensation already earned, plus 15 days by way of indemnity.
ATTORNEY’S FEES
In employment termination cases, attorney’s fees are not recoverable

where there is no sufficient showing of bad faith on the part of private
respondent.
FINANCIAL ASSISTANCE
(Justice Outside the Law)
Where there is doubt that dishonesty was committed, financial

assistance may still be awarded an employee who has rendered long years of
service. The doubt is resolved in employee’s favor; hence, despite the nature of

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the offense, financial assistance on grounds of compassionate justice may still

be given.
QUITCLAIMS
Once an employee resigns and executes a quitclaim in favor of the

employer, he is thereby estopped from filing any further money claim.
• It should be voluntarily signed.
• But even if voluntary, if it is contrary to public policy, it is deemed

INVALID.
NOTE: Not all waivers and quitclaims are invalid as against public policy. If the
agreement was voluntarily entered into and represents a reasonable
settlement, it is binding on the parties. It is only when there is clear
proof that the waiver was wangled [of fixed] from an unsuspecting or
gullible person, or the terms are unconscionable that the law will step
in to annul it.
“Dire necessity” is not an acceptable ground for annulling the

releases.
PRESCRIPTION
ü 4 years- Illegal Dismissal

ü 3 years – Money Claims
XII
RIGHT TO SELF ORGANIZATION
AND LABOR ORGANIZATION
LEGAL BASES
1. Art. III, Sec. 8, 1987 Philippine Constitution:

- The right of the people, including those employed in the public and private
sectors, to form unions, associations or societies for purposes not contrary to law
shall not be abridged.
2. Art. XIII, Sec. 3, 1987 Philippine Constitution
3. Executive Order 111
4. Executive Order 180 (Right of Government Employees to Organize and Unionize)
5. Presidential Decree 807
NATURE AND EXTENT (Art. 246)
• This right shall include the right to form, join, or assist labor organizations for the
purposes of :

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§ Collective bargaining;
§ To engage in lawful concerted activities for the same purpose;
§ Mutual aid and protection.
COVERAGE
General Coverage (CIA CHREM)
• All Persons Employed In:
Commercial
Industrial
Agricultural
} Enterprises
Charitable
Religious Institutions
Educational
Medical
F For collective bargaining

F For mutual aid and protection
NOTE: This is whether such institutions or enterprises are operating for

profit or not
• The following are also included in the coverage of the right to self-
organization (AIRWIS):
F Ambulant workers
F Intermittent workers
F Rural workers
F Workers with no definite employers
F Itinerant workers
F Self-employed
Specific Coverage (STAGNIS)
• Supervisory Employees
Supervisory employees shall not be eligible for membership in a labor
union of the rank-and-file employees but may form, join or assist
separate labor unions of their own
A union whose membership is a mixture of supervisors and rank-and-

file is not and cannot become a legitimate labor organization
A local supervisor’s union should not be allowed to affiliate with the

national federation of union of rank-and-file employees where that
federation actively participates in union activity in the company and
the rank-and-file employees are directly under the authority of the
supervisory employees

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• Terminated Employees who are Contesting their Termination
• Aliens with Valid Work Permit

Provided that said aliens are nationals of a country, which grants the
same or similar rights to Filipino workers (Art. 269, LCP).
• Government Employees
• New Employees
• Iglesia ni Kristo Members

The right of members of the INK sect not to join a labor union for being
contrary to religious beliefs, does not bar the members of that sect from
forming their own (KMCD v. Pura-Ferrer-Calleja, June 20, 1988)
• Security Guards
RIGHT OF EMPLOYEES IN THE
PUBLIC SERVICE (Art. 244, LCP)
Employees of GOCC’s established under the corporation code shall have the right to
organize and to bargain collectively.
NOTE:
• “Manner of Creation Test”
If employees of private corporation acquired by GOCC with original
charter, they can organize for purposes of collective bargaining.
Employees of National Government and LGU’s as well as employees of

GOCC’s with original charters shall have the right to form associations
for purposes not contrary to law.
• Executive Order 180

The right of government employees to form, join, or assist employees’
organizations of their own choosing is not regarded as existing or
available for purposes of collective bargaining but simply for the
furtherance and protection of their interests (Arizala vs CA, Sept. 14,
1990).
Excluded from negotiation by Government employees are the terms

and conditions of employment that are fixed by law, it being only those
terms and conditions not otherwise fixed by law.
…concedes to government employees the right to engage in concerted

activities, including the right to strike provided such activities are
exercised in accordance with law.
Exclusions (HEMACEN)
• High level Government employees;

• Employees of Coop who are members;
• Managerial employees;
• AFP and police personnel;
• Confidential employees;
• Employees of International Organizations with immunity;
• Non-employees;

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INELIGIBILITY OF MANAGERIAL EMPLOYEES

TO JOIN ANY LABOR ORGANIZATION
(Art. 245, LCP)
Managerial employees are not eligible to join, assist or form any labor
organization.
TYPES OF MANAGERIAL EMPLOYEES
• First-line Managers
Direct operating employees only; they do not supervise other
managers. They are also called SUPERVISORS.
• Middle Managers
Direct the activities of other managers and sometimes those of
operating employees.
• Top Managers
Responsible for the overall management of the organization.
NOTE: Look into the functions they perform before determining whether the
managerial employee is excluded or not.
CONFIDENTIAL EMPLOYEES
Confidential employees shall be ineligible to form, assist, or join labor unions.
ELEMENTS (concurrent/ cumulative)
• Employee assists/acts in a confidential capacity.

• A person, who formulates, determines, and makes management policies in
the field of labor relations.
RULES
The following are the rules of disqualification or non-disqualification arising

from the access to (1) business [or financial], and (2) labor relations information of a
confidential employee:
• Access to labor relations information = DISQUALIFIES

• Access to business or financial information = DOES NOT DISQUALIFY
• Access to labor relations information is INHERENT in the job =
DISQUALIFIES
• Access is ACCIDENTAL = DOES NOT DISQUALIFY
LABOR ORGANIZATIONS
Definition
Any union or association of employees which exists in whole or in part for the
propose of collective bargaining or of dealing with employers concerning terms and
conditions of employment.
Legitimate Labor Organization

It means any labor organization duly registered with the DOLE and includes
any branch or local thereof.

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Governmental Regulations
A. Registration Requirements
• For Independent Registration

The application for registration of an independent union shall be
supported by the following: (CAMPRON)
F Constitution and By-laws;

F Annual Financial Report [if in existence for more than one
(1) year];
F Minutes of Organizational Meeting;
F Principal Address of Union;
F Registration Fee;
F Officers’ Names and Addresses;
F Names of workers constituting 20% of the appropriate
bargaining unit.
WHERE to file application:

The application shall be filed with and be acted upon by the
REGIONAL OFFICE where the principal office is located.
• For the Registration of a Federation / National Union:

The application for registration of a federation or national union shall
be supported by:
F Annual Financial Report [if in existence for more than one
(1) year];
F Minutes of Organizational Meeting;
F Registration Fee;
F Names of workers constituting 20% of the appropriate
bargaining unit.
F Resolution of affiliation of at least 10 locals/chapters or
affiliates.
F Names and addresses of the companies where the
locals/chapters operate and the list of all the members in
each company involved.
NOTE: The locals/chapters or affiliates must be a duly recognized or
certified bargaining representative in the establishment where it
seeks to operate.

Application shall be filed with the Bureau. Where the
application is filed with the Regional Office, the same shall be
immediately forwarded to the Bureau within 48 hours from
filing thereof.
• For registration of an Industry or Trade Union Center

The application for registration of an industry or trade union shall be
supported by the following:
F List of its member organizations and their respective

presidents;
F Resolution of membership of each member organization;

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F Name and principal address of the applicant;

F Officers’ names and their addresses;
F Minutes of the organizational meeting;
Application shall be filed with the Bureau. Where the

application is filed with the Regional Office, the same shall be
forwarded to the Bureau within 48 hours from filing thereof.
• For Registration of Worker’s Association
The application for registration of a worker’s association shall be

supported by:
F Members’ names and addresses;
F Principal office of the applicant;
F Minutes of organizational meetings;
The application for registration of a workers’ association, whose

place of operation is confined to one regional jurisdiction, shall
be filed directly and acted upon by the Regional Office where it
operates. Otherwise, the application shall be filed and acted
upon by the Bureau.
Provisions Common to the Registration of

Labor Organizations and Workers’ Association
The application for registration, including all the enclosed [or
supporting] documents, shall be verified under oath by its secretary or
treasurer, as the case may be, and attested to by its President.
After a labor organization has filed the necessary papers and

documents for registration, it becomes mandatory for the Bureau or
Regional Office as the case maybe, to check if the registration
requirements have been complied with. The basis for the issuance of a
certificate of recognition should be compliance with the requirements
of recognition.
• For Chapter Registration

A duly registered federation or national union may directly
create a local/chapter by submitting to the Regional Office or to
the Bureau two (2) copies of the following:
F Charter certificate issued by the federation or
national union.
F Names of the local/chapter’s officers and their
addresses
F Principal office of the local/chapter.
F Constitution and By-laws of the local/chapter.
All the foregoing supporting requirements shall be certified
under oath by the secretary or the treasurer of the local/chapter
and attested to by its president.

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NOTE: A duly registered workers’ association may likewise

charter any of its branches, subject to the filing of the
documents prescribed for charter registration.
A duly constituted local/chapter shall acquire legal personality:

§ Only for purposes of filing a petition for certification
election from the date it was issued a charter certificate;
and
§ For entitlement to all other rights of a legitimate labor

organization.
It shall be reckoned from the date of filing of the complete
documents enumerated therein.
Rationale of Registration
Registration makes a labor organization legitimate in the sense
that it is clothed with legal personality to claim the representational and
bargaining rights.
Registration is not a limitation to the right of

assembly/association which may be exercised with or without said
registration; it is merely a condition sine qua non for the acquisition of
legal personality.
Effect of Registration
The labor organization or worker’s association shall be deemed

registered and vested with legal personality on the date of issuance of
its certificate of registration. Such legal personality cannot thereafter be
subject to collateral attack, but may be questioned only in an
independent petition for cancellation.
B. Rights of a Labor Organization (Art. 242, LCP)
1. to act as the representative of its members for the purpose of

collective bargaining;
2. to be certified as the exclusive representatives of the employees in

an appropriate collective bargaining unit;
3. to be furnished with the annual audited financial statements.
These financial statements may be asked in writing by the

Union in FOUR points in time:
i. After the union had been recognized as the sole

bargaining representatives;
ii. After certification by the DOLE as the sole
bargaining representative;
iii. Within the last 60 days of the life of the CBA; and
iv. During the collective bargaining negotiation.
4. to own property for the use and benefit of the organization;
5. to sue and be sued in its registered name; and
6. to undertake all activities designed to benefit of the organization
and its members.

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C. Rights of Union Members (Art.241, LCP);

Political Rights (REN2)
F Right against knowing admission of subversives;

F Election of officers directly, by secret ballot every five (5) years;
F No imposition of other qualification for positions except
membership in good standing; and
F No election or appointment of persons convicted of crimes
involving moral turpitude.
• Deliberative Right
F Determination by secret ballot of all major policies
• Rights over Money Matters (STAR4N5U)

F Salaries of officers should be authorized by the Constitution
and By-laws or General Membership Resolution;
F True and correct accounting by treasurer: (1) at least once a
year within 30 days after the close of its fiscal year; (2) at
such other times as may be required by a resolution of the
majority of the members; (3) upon vacating his office;
F Accounts (Books of) shall be open to inspection during
office hours;
F Reports on all financial transactions, full and detailed;
F Records on all income showing the sources;
F Receipts of all payments signed by the collector;
F Records of all expenditures showing payee and purpose;
F No arbitrary, excessive initiation fee, fine;
F No collection of fees unless authorized by Constitution and
By-laws;
F No additional compensation for officers;
F No special assessments unless authorized by General
Resolution;
F No check off unless authorized by individual written
resolution;
F Use of funds only if authorized by Constitution and By-laws
or general resolution;
• Right to Information
F information on CBL, CBA, and their rights and obligations
NOTE: The Regional Director of DOLE, not the labor arbiter has
jurisdiction over check-off disputes
D. Union- Member Relationship
The relationship is fiduciary in nature and arises out of two factors:
1. Degree of dependence of the individual employee on the union

organization; and

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2. Comprehensive power vested in the union with respect to the

individual (Heirs of Teodolo M. Cruz vs. CIR, 30 SCRA 917).
Consequence of Violation of Rights

or the Conditions of Membership
• Cancellation of union registration; and

• Expulsion of culpable officers.
NOTE: Under the Implementing Rules of the Labor Code, it provided that
no cancellation shall be ordered unless the complaint is
supported by at least thirty percent (30%) of the union
membership.
EXCEPTION: When the violation directly affects only one or two

members then such members would be enough to report
such violation.
Check Offs and Assessments
- Under Article 277 (a), it recognizes the right of the union
to collect union dues.
- The amount of union dues should be reasonable and Article
241 prohibits the imposition of excessive or arbitrary fees.
q DUES are payments used to meet the union’s general and

current obligations.
Requirements of Payment:
a. regular;
b. periodic;
c. uniform.
q REQUISITES FOR SPECIAL ASSESSMENTS FOR THE

UNION’S INCIDENTAL EXPENSES:
1. authorization by a written resolution of the majority
of the members at the general membership meeting
duly called for such purpose;
2. secretary’s record of the minutes of the meeting; and
3. individual written authorization for check off duly
signed by the employee.
NOTE: Jurisdiction over check off disputes is under the

Regional Director of the DOLE and not the labor arbiter. This is
because the dispute is not a money claim, instead a complaint
against the union.
E. Union Affiliation and Disaffiliation
AFFILIATION
- An AFFILIATE is an independently registered union that

entered into an agreement of affiliation with a federation or
a national union.

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- It also refers to a chartered local, which applied for and was

granted an independent registration but did not disaffiliate
with the mother federation or the national union.
• Requirements for the Report of Affiliation

(SEC. 16, Rule111, D.O. No. 40-03)
1. Resolution of the labor union’s board of directors
approving the affiliation;
2. Minutes of the general membership meeting
approving the affiliation;
3. Total number of members comprising the labor
union and the names of the members who approved
the affiliation;
4. Certificate of affiliation issued by the federation in
favor of the independently registered labor union;
and
5. Written notice to the employer concerned if the
affiliation union is the incumbent bargaining agent.
WHERE to file: to the Regional Office that issued the union’s

certificate of registration.
DISAFFILIATION
- The freedom to disaffiliate is a protected labor activity and

may be exercised only when warranted by the
circumstances.
• SANCTIONED PERIODS OF DISAFFILIATION:

1. during the 60-day period (freedom period)
immediately preceding the expiration of the CBA.
2. even before the onset of the freedom period when
such disaffiliation is effected by a majority of the
members of the bargaining unit.
• EFFECTS OF DISAFFILIATION:
1. If the union is not independently registered, it is not
entitled to the rights and privileges granted to
legitimate labor organizations.
2. The federation is entitled to receive the dues from
the employer only as long as the union is affiliated
with the federation. Without said affiliation, the
employer has no link with the federation.
3. The CBA continues to bind the members of the new
or disaffiliated and independent union up to the
CBA’s expiration date. (SUBSTITUTIONARY
DOCTRINE)
q Under this doctrine, the employees cannot

revoke the validly executed collective
bargaining contract with their employer by
the simple expedient of the changing of the
bargaining agent. The new agent must
respect the contract.
• REVOCATION OF CHARTER:
- A federation, national union or worker’s association
may revoke the charter issued to a local or chapter.

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Grounds for Revocation:
1. Disloyalty;
2. such other grounds as may be specified in
the constitution and by-laws of the
federation, national union or worker’s
association.
Effect: the revocation will serve to divest the
local/chapter of its legal personality upon receipt of
the notice of the Bureau, UNLESS in the meantime
the local/chapter has acquired independent
registration.
MERGER OR CONSOLIDATION
MERGER is a process where a labor organization absorbs

another, resulting in the cessation of the absorbed
labor organization’s existence and the continued
existence of the absorbing organization.
CONSOLIDATION/AMALGAMATION refers to the creation

or formation of a new union arising from the
unification of two or more unions. This process
usually occurs between two unions that are
approximately of the same size.
Notice of Merger/Consolidation
WHERE TO FILE: the notice shall be filed to
and recorded by the Regional Office that
issued the certificate of registration or
certificate of creation of chartered local being
merged or consolidated.
Requirements:
1. the minutes of merger or consolidation
convention or general membership meetings
of all the consolidating or merging labor
organizations with the list of their respective
members who approved the same;
2. amended constitution and by-laws and the
minutes of its ratification.
CHANGE OF NAME
WHERE TO FILE: The notice for change of name shall be filed

with the Bureau or the Regional Office where the concerned
labor organization’s certificate of registration or certificate of
creation of chartered local is issued:
OTHER REQUIREMENTS:
1. approval or ratification of change of name; and
2. amended constitution an by laws.
EFFECT: The change of name shall not affect the legal

personality of the organization and the rights and obligation

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of a labor organization under its old name shall continue to

be exercised under its new name.
F. Cancellation of Registration (ART.238-239, LCP)
GROUNDS (ART. 239, AS AMENDED by RA 9481; May 25, 2007)

a. misrepresentation, false statement or fraud in connection
with the adoption, ratification of the constitution and by-
laws or amendments thereto, minutes of ratification;
b. misrepresentation, false statement or fraud in connection
with the election of officers, minutes of the election, the list
of voters or failure to submit these documents together with
the list of the newly elected officers within thirty (30) days
from election;
c. voluntary dissolution of members.
NOTE: The failure to submit the documents within thirty (30)
days from adoption or ratification, as previously
required by Art. 239, is NO LONGER a ground for
cancellation but shall subject the erring officers or
members to suspension, expulsion from membership or
any appropriate penalty. (SEE FURTHER RA 9481)
GROUPING OF THE GROUNDS
a. Commission of any of the acts enumerated under Article

239, which includes the failure to meet the registration
requirements under articles 237, and 238.
b. Violation of any of the acts enumerated under Article 241
(violation of the rights and conditions of membership) if the
petition for the cancellation is supported by at least 30% of
the membership.
NOTE: “Cabo” system refers to a person or a group of persons or
to a labor group, which, in the guise of a labor
organization, supplies workers to an employer with or
without any monetary or other consideration whether in
the capacity of an agent of the employer or as an
ostensible independent contractor.
WHO FILES THE PETITION: Any party in interest except in an action

involving violations of Article 241, which can only be
commenced by members of the labor organization constituting at
least thirty percent of all the members.
WHERE TO FILE:
• for legitimate independent labor union, chartered local

or worker’s association: to the REGIONAL DIRECTOR;
• for federations, national or industry unions and trade

union centers: to the BUREAU DIRECTOR.
NOTE: Inclusion as members of employees outside the bargaining unit

shall not be aground for the cancellation of union registration.
They are automatically deemed removed from the list of
membership of said union.

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VOLUNTARY CANCELLATION
OF REGISTRATION
REQUIREMENTS:
a. at least two-thirds (2/3) of members vote is attained,
in a meeting called for voluntary cancellation of
registration, to dissolve the organization; and
b. an application to cancel registration is submitted by
the board of the organization and attested by the
president.
APPEAL
a. cancellation orders issued by the regional director are

appealable to the BLR;
b. decisions of the BLR are final and executory;
c. BLR decisions on cancellation issues, which originated in
the BLR itself, may be appealed to the SOLE. (Abbot
Laboratories vs. Abbot Laboratories Employees Union, et. al.,
January 26, 2000).
XIII
UNION REPRESENTATION
APPROPRIATE BARGAINING UNIT
BARGAINING UNIT: It is defined as a group of employees sharing mutual

interest within a given employer unit, comprised of all or less than all
of the entire body of employees in the employer unit or any specific
occupational or geographical grouping within such employer unit (Book
V, Rules Implementing the Labor Code).
BARGAINING AGENT: Is the one chosen union to represent the CBU in

bargaining with the employer.
Factors to Consider
- The determination of what constitutes a proper bargaining unit lies
primarily with the Bureau;
- No individual factor is given by law decisive weight:
a. whether it will best assure to all employees the exercise of their
collective bargaining rights;
b. the bargaining unit is one which must be comprised of constituents
enjoying a community of interest;
c. desires of employees; and
d. geographical location.

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Factors to Consider in Community of

Interest or Mutuality of Interest (S4FGC2HED)
a. Similarity in the scale and manner of determining earnings;

b. Similarity in employment benefits, hours of work and other terms and
conditions of employment;
c. Similarity in the kinds of work performed;
d. Similarity in the qualifications, skills and training of the employees;
e. Frequency of contact or interchange among the employees;
f. Geographic proximity;
g. Continuity or integration of production processes;
h. Common supervision and determination of labor-relations policy;
i. History of collective bargaining;
j. Extent of union organization;
k. Desires of the affected employees.
GLOBE DOCTRINE : It provides the desires of the employees are relevant to the
determination of the appropriate bargaining unit. The relevancy of the
wishes of the employees concerning their inclusion or exclusion from a
proposed bargaining unit is inherent in the basic right to self-organization.
NOTE: The determination of the scope or membership of the bargaining unit

also leads to the determination of:
o The employees who can vote in the certification election;
o The employees to be represented in bargaining with the employer;
and
o The employees who will be covered by the resulting CBA.
Mode of Selection of Appropriate

Bargaining Unit
A. VOLUNTARY RECOGNITION
- Where a clear majority of the employee, without subjection to

coercion or other unlawful influence, have made clear their desire
to be represented by a particular union, the employer may
recognize and contract with such union.
- It is possible only in an unorganized establishment.
WHEN to file: Within thirty (30) days from recognition, the

employer and the union shall submit a notice of voluntary
recognition.
WHERE to file: It must be filed to the Regional Office who issued the
recognized labor union’s certificate of registration or certificate
of creation of a chartered local.
REQUIREMENTS
The notice of voluntary recognition shall be accompanied by the

original copy and two (2) duplicate copies of the following
documents:

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1. JOINT STATEMENT under oath of voluntary recognition

attesting to the fact of voluntary recognition;
2. CERTIFICATE OF POSTING of the joint statement for fifteen
(15) consecutive days in at least (2) conspicuous places in
the establishment or bargaining unit where the union seeks
to operate;
3. the APPROXIMATE NUMBER OF EMPLOYEES in the bargaining
unit, accompanied by the names of those who support the
voluntary recognition comprising at least a majority of the
members of the bargaining unit; and
4. STATEMENT that the labor union is the only legitimate labor
organization operating within the bargaining unit.
o All accompanying documents must be certified under oath by the
employer and president of the recognized labor union
ACTION on the Notice
o IF SUFFICIENT IN FORM: within ten (10) days from receipt of

the notice.
o IF INSUFFICIENT IN FORM: the Regional Office within ten (10)
days from receipt of notice notify the labor union of its findings
and advise it to comply with the necessary requirements.
§ Failure to complete by the employer or the labor union within

thirty (30) days from receipt of the advisory: return of the notice
of voluntary recognition without prejudice to its re-submission.
EFFECT
From the time of recording, the union shall enjoy the rights,
privileges and obligations of an exclusive bargaining representative
NOTE: Entry of the voluntary recognition shall bar the filing of a

petition for certification election by any labor organization for a
period of one year from the date of entry.
B. CERTIFICATION ELECTION
- It is the process of determining through secret ballot the sole and

exclusive representative of the employees in an appropriate
bargaining unit for purposes of collective bargaining or negotiation.
WHO may File

• ORGANIZED Establishment
F Any LLO supported by the written consent of at
least 25% of all the employees in ABU.
F Any employer, when requested to bargain
collectively.
• UNORGANIZED Establishment
F Any LLO.

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F Any employer, when requested to bargain

collectively.
WHEN to File:
F NO CBA, any time outside the 12-month bar,
negotiation bar, and deadlock bar.
F During the 60-day “‘freedom period” of a duly

registered CBA.
F Anytime
WHERE to File:
It may be filed with the MED-ARBITER through the
Regional Office, which has over the principal office of the
employer or where the bargaining unit is prin cipally situated
FORM of Petition
It shall be in writing and under oath.
CONTENTS of Petition
• When filed by an LLO
F Name of petitioner, its address, and affiliation if
appropriate, the date of its registration and number
of its certificate of registration if petitioner is a
federation, national union or independent union, or
the date it was reported to the Department if it is a
local/chapter.
F Name, address and nature of the employer’s

business.
F Description of the bargaining unit.
F Approximate number of emplo yees in the bargaining
unit.
F The names and addresses of other LLO in the
bargaining unit.
F A statement indicating any of the following
circumstances:
~ That the bargaining unit is unorganized or
that there is no registered CBA covering the
employees in the bargaining unit;
~ If there exists a duly registered CBA, that the
petition is filed within the 60-day freedom
period of such agreement;
~ If another union had been previously
certified in a valid certification, consent or
run-off election or voluntarily recognized,
that the petition is filed outside the one (1)-
year period from such certification or run -off
election and no appeal is pending thereon, or

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from the time the fact of recognition was

entered into the records of such union.
F In an organized establishment, the signature of at

least 25% of all employees in the ABU which shall be
attached to the petition at the time of its filing; and
F Other relevant facts
• WHEN Filed by an Employer

F Name, address and general nature of the employer’s
business.
F Names and addresses of the legitimate labor
organizations.
F Approximate number of employees in the ABU.
F Description of the bargaining unit.
F Other relevant facts.
PROCEDURE
I. PRELIMINARY CONFERENCE
o The first preliminary conference shall be scheduled
within ten (10) days from the receipt of the petition.
o Within three (3) days from receipt: service of the notice
of preliminary conference.
During the preliminary conference, the following are

determined:
i. The bargaining unit to be represented;
ii. Contending labor unions;
iii. Possibility of consent election;
iv. Existence of the bars to certification election;
v. Such other matters as may be relevant to the final
disposition of the case.
If the parties will agree to hold a consent election, the PCE
will no longer be heard.
A. HEARINGS AND PLEADINGS

o The Med-Arbiter may conduct as many hearings as
may be deemed necessary.
o BUT the conduct of the hearing cannot exceed
fifteen (15) days from the date of the scheduled
preliminary conference.
o During the same period, the contending labor unions
may file such pleadings as may deem necessary.
PURPOSES OF HEARING
• Arriving at a stipulation of facts;
• Determining the parties to the election;
• Getting the parties to agree to a consent election;
• Asking clarificatory questions; and

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• Defining or limiting the issues.

EFFECT OF FAILURE TO APPEAR
o It is deemed as waiver of the right to be heard;
o But, if parties agree for meritorious reason, the
scheduled conference may be cancelled.
B. DECISION ON THE PETITION

o The decision granting or denying the petition shall be
issued within ten (10) days from the last hearing.
o IN UNORGANIZED ESTABLISHMENTS, no order or
decision shall be issued by the Med-Arbiter within the
freedom period.
Contents of Decision
a. Name of the employer or the establishment.
b. Description of the bargaining unit.
c. Statement that none of the grounds for dismissal
exists.
d. Names of the contending labor unions, which shall
appears as follows: petitioner union/s in the order
in which their petitions were filed, forced
intervener, and no union.
e. Directive upon the employer and the contending
labor union to submit within ten (10) days from
the receipt of the order, the certified list of
employees in the bargaining unit, or the payrolls
covering the members of the bargaining unit for
the last three months prior to issuance of the
order.
Grounds for Denial [Bars to Certification Election]
a. Petitioner is not listed in the Department’s registry
of legitimate labor unions or that its legal
personality has been revoked or cancelled with
finality.
b. The petition was filed before or after the freedom
period of a duly registered collective bargaining
agreement.
c. The petition was filed within one (1) year from the
entry of voluntary recognition or valid
certification, consent or run-off elections and no
appeal is pending.
d. A duly certified union has commenced and
sustained negotiations with the employer or there
exists a bargaining deadlock, which has been
submitted to conciliation and mediation or has
become the subject of a valid notice of strike or
lockout.
e. In organized establishment, failure to submit
twenty-five percent (25%) support requirement.

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Appeal of Order Denying or Granting the Petition

o In an unorganized establishment, the order
granting the petition is not subject to appeal. Any
issue may be raised by means of protest.
o Appeal should be verified under oath and consists
of the memorandum of appeal stating the grounds
relied upon by the appellant with the supporting
argument and evidence
WHERE to File: Regional Office where the petition
originated
If no appeal is filed within the ten (10)-day period,

the Med-Arbiter shall enter the finality of the order or
decision in the records of the case and cause the
transmittal of the records of the petition to the Regional
Director.
II. CONDUCT OF CERTIFICATION ELECTION
A. PRE-ELECTION CONFERENCE
The pre-election conference shall set the mechanics

for the election and shall determine, among others, the
following:
• List of qualified voters;

• The date, time and place of the election;
• Names of watchers and representatives;
• The number and location of polling places or
booths; and
• The number of ballots to be prepared.
• Mechanics and guidelines of the election.
WHO are Qualified to Vote
All employees who are members of the appropriate

bargaining unit sought to be represented by the petitioner
at the time of the certification or consent election shall be
qualified to vote.
NOTE: Contested voters shall be allowed to vote;

however, their votes shall be segregated and
sealed in individual envelopes.
A DISMISSED EMPLOYEE whose dismissal is

being contested in a pending case shall be allowed
to vote.
PROBATIONARY employees have substantial

interest in the selection of the bargaining
representative, hence they are allowed to vote.

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INK (Iglesia ni Kristo) believers may vote.
POSTING of Notices
• At least 10 days prior;
• Two (2) conspicuous places in the company
premises;
• Date and time of election;
• Description of bargaining units and the list of
Eligible voters and challenged voters;
• Names of all contending unions.
NOTE: May be waived upon agreement of

parties
B. ELECTION PROPER
Election shall be set during a regular business day of
the company UNLESS otherwise agreed upon by the
parties. It shall be held within company premises UNLESS
circumstances otherwise require, as determined by the
election officer.
ON-THE-SPOT Questions
The election officer may rule on any question

relating to and rose during the conduct of election. In no
case, however, shall the election officer rule on any of the
grounds for challenge of votes.
CHALLENGE of Votes
An authorized representative of any of the

contending parties may challenge a vote before it is
deposited in the ballot box ONLY on any of the following
grounds:
• There is no employer-employee relationship

between the voter and the company; and
• The voter is not a member of the ABU which
petitioner seeks to represent.
When a vote is properly challenged, the election

officer shall place the ballot in an envelope, which shall be
sealed in the presence of the voter and the representative
of the parties.
PROTEST
Any party-in-interest may file a protest based on the

conduct or mechanics of the election.
Protests not so raised are deemed waived. Protesting

party must formalize its protest with the Med-Arbiter, with
specific grounds, arguments and evidence therefore,
within 5 days after the close of the proceedings.

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C. CANVASSING OF VOTES
Done in the presence of the representatives of the

contending unions.
Upon completion, the election officer shall give each

of the representatives a copy of the minutes of the
election proceedings and results of the election.
The tally sheets and the ballots shall be sealed in an

envelope, signed by the election officer and the
representatives, and transmitted to the Med-Arbiter.
D. PROCLAMATION AND CERTIFICATION BY

ELECTION OFFICER
Upon completion of the canvass and there being a

valid election, the election officer shall proclaim and
certify as winner the union which obtained a majority of
the valid votes cast under any of the following conditions:
• No protest has been filed or, even if one is filed,

the same was not perfected within the five (5)-
day period for perfection of the protest;
• No challenge or eligibility issue was raised or,
even if one was raised, the resolution of the
same will not materially change the result.
E. PROCLAMATION AND CERTIFICATION BY

MED-ARBITER
When a protest has been perfected or any challenged

or eligibility issue has been raised which, if resolved, can
materially change the result, only the Med-Arbiter can
proclaim and certify the winner.
F. APPEAL AS TO RESULT OF ELECTION
The decision of the Med-Arbiter may be appealed

to the Sec. Of Labor ONLY on the grounds of violation of
Sec. 9, Rule XII, IR Bk V regarding challenging of votes or
of serious errors of fact or law in the resolution of the
protest.
REQUIRED VOTE
The union that obtains a majority of the valid votes cast shall be
certified as the sole and exclusive bargaining agent of all the workers
in the appropriate bargaining unit.
FAILURE OF ELECTION
The total number of valid votes cast in a certification or consent

election is LESS than the majority of all the eligible employees in the
bargaining unit.
NOTE: Failure of election shall not bar the filing of a petition

for the immediate holding of another certification or
consent election.

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EFFECT OF PETITION FOR

CANCELLATION OF UNION
REGISTRATION
Now, under ARTICLE 238-A (AS AMENDED BY RA 9431), the
petition for cancellation of union registration shall no longer suspend
the proceedings for Certification Election nor shall it prevents the filing
of the same. The amendment effectively reversed the previous
application of prejudicial question in Certification Election.
RATIONALE
A LLO is entitled to all the rights or privileges granted by law
until its registration is cancelled or revoked with finality.
RUN-OFF ELECTION
Requisites
• A valid election took place because majority of the CBU

members voted;
• The election presented at least three choices;
• Not one of the choices obtained the majority of the valid
votes;
• The total votes of the unions is al least 50% of the votes cast;
• There is no unresolved challenge of voter or election
protest;
WHO Participates
The participants are the members of the labor unions receiving

the two highest numbers of votes.
CONSENT ELECTION
In hearing a petition for a CE, the Med-Arbiter may persuade

the contending unions to agree to a consent election. If the unions do
agree, the Med-Arbiter shall enter in the minutes of the hearing the fact
of the agreement and then cause the immediate scheduling of the pre-
election conference.
NOTE: The holding of a valid consent election, upon the

intercession of the Med-Arbiter, bars the holding of a CE
for one year.
Where no petition for a CE had been filed, but the parties

themselves have agreed to hold consent election, the results of the
election will NOT bar another CE, UNLESS the winning union had been
extended voluntary recognition by the employer.

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CONSENT CERTIFICATION
Election Election
It is aimed at
It is an agreed one, its
determining the sole
purpose being merely to
and exclusive
determine the issue of
bargaining agent of all
majority representation
the employees in the
of all the workers in the
ABU for the purpose of
ABU
collective bargaining
NOTE: Consent election is a separate and distinct process and

has nothing to do with the import and effect of a
Certification Election. Neither does it shorten the terms
of an existing CBA nor entitle the participants thereof to
immediately renegotiate an existing CBA although it does
not preclude the workers from exercising their right to
choose their sole and exclusive bargaining representative
after the expiration of the 60-day freedom period.
MOTION FOR INHIBITION
No motion for inhibition of the Med-Arbiter shall be entertained

from any part UNLESS the same is verified and based on specific
grounds or circumstances directly related to or arising from the dispute
under consideration.
MOTION FOR INTERVENTION
Form and contents shall be the same as that of a petition for CE.
WHO may File

F Any LLO other than the incumbent.
F The incumbent bargaining agent (FORCED
INTERVENOR).
F Any LLO.
WHEN to file
F During the freedom period of the CBA.
F Anytime prior to the finality of the decision
calling for CE.

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NOTE: In an unorganized establishment, the order of the Med-

Arbiter resolving the motion shall not be subject to
reconsideration or appeal.
XIV
DUTY TO BARGAIN
CONCEPT OF THE DUTY TO

BARGAIN COLLECTIVELY
Collective Bargaining is the performance of the mutual obligation of the employer and
the sole bargaining representative to meet promptly, expeditiously, and in good faith, agree on
Wages, Hours of Work and Other terms and conditions of employment (WHO).
PHASES OF COLLECTIVE BARGAINING
• Legislative Phase
Negotiation and perfection of CBA.
• Executive Phase
CBA administration.
• Judicial Phase
Application and interpretation.
TWO SITUATIONS WHEN THE

DUTY TO BARGAIN EXISTS
• When there is NO CBA (Art. 252)

F PURPOSES of the Meeting
~ Negotiate an agreement over WHO including proposals for adjusting
grievances or questions arising under such agreement; and
~ to execute a CBA.
F LIMITATION
~ It does not compel any party:
1. to make an agreement, or
2. to make concession.
• When there is CBA (Art. 253)

F PURPOSES of the Meeting
~ Negotiate an agreement over WHO including proposals for adjusting
grievances or questions arising under such agreement; and
~ to execute a CBA, and

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~ to respect and allow the old CBA to have force and effect, if a new CBA
is forged.
NOTE: Within 60 days before the CBA expires (freedom period), either party may
notify the other in writing, that it desires to modify or terminate the
agreement.
PROCEDURES
• Jurisdictional Preconditions
F Existence of certified EBR;
F Possession of majority representative status;
F Proof of majority representative status;
F Demand of Bargain collectively.
• Procedure Proper (Art. 250)
F Written notice upon the other party with statement of proposal.
F The other party must reply not later than 10 days.
F Conference not later than 10 days from notice, in case of differences.
F NCMB, if differences is not settled.
F Prohibition against commission of acts that impede or disrupt proceedings.
F Amicable settlement of disputes by NCMB.
NOTE: ARTICLE 250 applies in the absence of the parties’ own private collective
bargaining procedure.
UNFAIR LABOR PRACTICES

RELATED TO DUTY TO
BARGAIN COLLECTIVELY
• Refusal or Failure to Meet and Convene

The duty to meet and convene includes:
F To bargain with the certified EBR;
F To meet and confer with the EBR and to recognize the EBR as
representative of all the employees in the CBU, even if not members of the
CBR.
F To negotiate grievances even if not covered by the CBA.
ACTS Not Deemed Refusal to Bargain

F Adamant bargaining position in good faith;
F Refusal to bargain over demands for commission of ULP;
F Refusal to bargain during period of illegal strike; and
F Refusal to bargain on non-mandatory provisions.
There is NO VIOLATION of Duty to Bargain Where:

F No request for bargaining;
F Union seeks recognition of inappropriately large CBU;
F Union seeks to represent non-members of CBU;

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F Rank-and-file unit includes supervisors; and

F Demand for recognition and bargaining within certification year where the
choice is no union.
F Unlawful bargaining demands
• Evasion of Mandatory Subjects of Bargaining
MANDATORY SUBJECTS
F Wages and Hours of Work
F Other terms and conditions
F Other modes of compensation
F Work shifts
F Vacation and holidays
F Bonuses
F Pensions and retirement plans
F Seniority
F Transfers
F Lay-offs
F Workload
F Work rules and regulations
F Rent of company houses
F Union security agreements
An employer does not commit ULP by insisting to the point of a bargaining

impasse, on the inclusion in a contract of a management prerogative clause, or a
union discipline clause, or a no strike clause.
NON-MANDATORY SUBJECTS
An employer cannot insist, to the point of creating a bargaining impasse, on

the scope of the statutory bargaining subjects, even if he acts in good faith.
DEADLOCK OR IMPASSE
A bargaining impasse over an issue exists where good faith bargaining on the part of
the parties has failed to resolve the issue and there are no definite plans for further efforts to
break the deadlocks.
DUTY TO BARGAIN WHEN

THERE IS DEADLOCK
Deadlock does not mean the end of bargaining. It signals rather the need to continue
the bargaining with the assistance of a third party as conciliator or arbitrator whose first aim is
to get the parties back to the negotiating table and help them create a win-win solution.

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STRIKE OR LOCKOUT IN
CASE OF DEADLOCK
ARTICLE 263 recognizes bargaining deadlock as a valid reason to declare a strike or

lockout.
• Instances of Bad Faith in Bargaining

F Delay of negotiations.
F Imposing time limit on negotiations
• Surface Bargaining
F A sophisticated pretense in the form of apparent bargaining.
F It does not satisfy the statutory duty to bargain.
• Boulwarism
F Bargaining in bad faith in take it or leave it bargaining.
NOTE: Good faith or bad faith is an inference to be drawn from the facts and in largely
a matter for the NLRB’s expertise.
A fair criterion of good faith in collective bargaining requires that the

parties involved deal with each other with open and fair mind, and sincerely
endeavor to overcome obstacles or difficulties existing between them, to the end
that employment relations may be established and obstruction to the free flow
of commerce prevented.
• Gross Violations of the Economic Provisions of CBA

This violation occurs during the implementation stage. It creates a further
obligation on the parties to adhere faithfully to the contract.
XV
COLLECTIVE BARGAINING
AGREEMENT (CBA)
CONCEPT OF CBA
CBA refers to a contract executed upon request of either the employees or the EBR of
the employees incorporating the agreement reached after negotiations with respect to wages,
hours of work and all other terms, and conditions of employment, including proposals for
adjusting grievances or questions under such agreement.
CBA is also a means of ensuring workers are entitled to participate in decision-making.
CONTENTS OF CBA
F Enumeration or Reservation of Management Rights

F Union Recognition and Security

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F Wage and Fringe Benefits and its Administration

F Physical Working Conditions
F Selected Personnel Management and Plant Operation Practices
F Grievance and Arbitration
F Duration of Contract
TERMS OF CBA
• Economic and Non-Economic Life: Three (3) Years.
• Political Life (Representation aspect: identity and majority status of the union that
negotiated the CBA as EBR of the bargaining unit concerned): Five (5) Years.
• Automatic Retroaction: Any agreement entered within six (6) months from the
date of expiry of the term shall retroact to the date immediately following such
date.
If the agreement is beyond six (6) months, there would be an automatic

retroaction. The date of the contract will be left to the parties.
• Automatic Renewal: An existing CBA is automatically renewed until the parties

reached to an agreement.
RATIFICATION
The agreement negotiated by the employees bargaining agent sho uld be ratified or
approved by the majority of all workers in the majority of all workers in the bargaining unit,
not just the members of the bargaining union.
Ratification AND its procedure are mandatory.
WHEN RATIFICATION NOT NEEDED
Ratification of the CBA by the employees in the bargaining unit is not needed when the
CBA is a product of an arbitral award by appropriate government authority or by a voluntary
arbitrator.
REGISTRATION
CBA, having been properly ratified, should be registered with the DOLE Regional
Office that has jurisdiction over the establishment

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XVI
CONCEPT
UNFAIR L ABOR PRACTICES are:
(1) violations to the Constitutional rights of workers and employees to self-

organization;
(2) inimical to the legitimate interests 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;
(3) disruptions to industrial peace; and
(4) hindrance the promotion of healthy and stable labor management relations
and mutual respect [unstable labor management relations] (ARTICLE 247).
TWO ASPECTS OF ULP

• Civil Aspect
F Includes claims for actual, moral, exemplary, and other forms of damages,
attorney’s fees, and other affirmative relief.
F Under the jurisdiction of the Labor Arbiters, they are bound to resolve the civil
aspect within 30 days from the time they are submitted for decision.
F Recovery of civil liability in the administrative proceedings shall bar recover
under the Civil Code.
• Criminal Aspect
F No criminal prosecution may be instituted without a final judgment first
obtained in the administrative proceeding finding that a ULP was committed.
F Prescriptive Period: One (1) year from accrual of ULP.
F During the pendency of the administrative proceeding, the running of the
prescriptive period for the criminal aspect of ULP is interrupted.
F The final judgment in the administrative proceedings shall not be binding in
the criminal prosecution nor considered as an evidence of guilt, it is a mere
proof of compliance with procedural requirements.
AVAILABLE RELIEFS
• Preventive
Through a cease and desist order to stop a party from engaging further in ULP acts.
• Remedial
Consisting of affirmative relief (reinstatement, damages, and attorney’s fees).

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• Penal
Fine or imprisonment, or both.
REMEDIES IN ULP CASES

• Cease and Desist Order
• Affirmative Order (For example, fully reinstatement of a discharged employee.)
• Order to Bargain
• Disestablishment: order directing the employer to withdraw all recognition from the
dominated labor union and to disestablish the same.
ELEMENTS NEEDED TO COMMIT ULP

• Existence of Employer – Employee Relationship;
• Act done is expressly defined in the Code as ULP (Arts. 248 and 249).
XVII
OF EMPLOYERS (Article 248)
GENERAL RULE
It is the prerogative of the company to promote, transfer or even demote its employees
to other position when the interest of the company demands it.
EXCEPTION
F When there is a clear interference by the employer of the employee’s right to self-
organization.
F The grant of profit sharing benefits to non-union members is not ULP; it is within
the prerogative of the management.
F FORCED vacation leave without pay in view of the economic crisis is not ULP.
F An employer does not commit an ULP by discharging employees who engage in a
slowdown. SLOWDOWN occurs when employees continue working on their own
terms and rejecting the standards desired by the employer.
• FIRST ULP : “INTERFERENCE”
To interfere with, restrain, or coerce employees in their exercise of the right to self-
organization.

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Forms of Interference
F Persistent interrogation of employees to elicit information as to what had
happened at union meetings and the identity of the active union
employees.
F Outright and unconcealed intimidation.
F Espionage and surveillance or “spying on employees”.
F Economic inducements.
F A violation results from an employer’s announcement of benefits prior to a
representation election, where it is intended to induced the employee to
vote against the union.
F The conferral of employee benefits for the employees to vote against the
union while a representation election is pending.
Totality of Conduct Doctrine

The culpability of employer’s remarks were to be evaluated not only on the
basis of their implications, but against the background of and in conjunction with
collateral circumstances.
Doctrine of Successor-in-Interest
or Successor Employer
The new employer (being the successor-in-interest), who succeeds a previous
employer with an existing CBA and who is a buyer in good faith, has no liability to the
employees in continuing employment and the collective bargaining agreement
because these contracts are in personam.
General Rule
Labor contractors are “in personam,” hence, doctrine of successor
employer, in cases of closure and sale to another, is not applicable.
Exceptions
F If there is a written agreement between the employer and the
employees to the effect that successor employer shall be held liable for
previous employer’s liabilities;
F Piercing the corporate veil.
Lockouts or Closure Amounting to ULP

A lockout, actual or threatened, as a means of dissuading the employees from
exercising their rights is clearly ULP.
• SECOND ULP : “YELLOW DOG” CONTRACT
It is a contract that requires a condition of employment that a person or an

employee shall not join a labor organization or shall withdraw from one to which he
belongs. It is also a promise exacted from workers as a condition of employment that they
are not to belong to or attempt to foster a union during their period of employment.
Contents of the Contract

F A representation by the employee that he is not a member of a labor union.
F A promise by the employee not to join a labor union.
F A promise by the employee that, upon joining a labor union, he will quit his
employment.

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• THIRD ULP : “CONTRACTING OUT”
Contracting out is to control out services or functions being performed by union

members so that the management could to interfere with, restrain, or coerce employees in
the exercise of their right to self-organization.
Runaway Shop (ULP)

An industrial plant moved by its owners from one location to another to escape
union regulation or state laws, but the term is also used to describe a plant removed to
a new location in order to discriminate against employees at the old plant because of
their union activities.
• FOURTH ULP : “COMPANY DOMINATION 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 it or its organizers or supporters.
Forms
F Initiation of company union idea.
F Outright formation by the employer or his representatives.
F Employee formation on outright demand or influence by the employer.
F Managerially motivated formation by employees.
F Financial support to the union.
F Employer defrays the union expenses or pays the attorney who drafted the CBL
of the union.
F Employers encouragement and assistance.
F Immediately granting the union exclusive recognition as a bargaining agent
without determining whether the union represents the majority of employees.
F Supervisory assistance.
F Soliciting membership, permitting union activities during working time, or
coercing employees to join the union by threats of dismissal or demotion.
• FIFTH ULP: “DISCRIMINATION FOR OR AGAINST UNIONISM”
This is an act of discrimination concerning wages, hours of work and other terms,
and conditions of employment in order to encourage or discourage membership in any
labor organization.
Discrimination by Blacklisting
A BLACKLIST is a list of persons marked out for special avoidance,
antagonism, or enmity on the part of those who prepared the list, or those among
whom it is intended to circulate.
Test of Discrimination
It is necessary that the underlying reason for the discharge be established.
Constructive Discharge
Where an employer prohibits employees from exercising their rights, on pain
of discharge, and the employee quits as a result of the prohibition, a constructive
discharge occurs, witch may be remedied in a ULP proceeding.

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Valid Discrimination
Where Management and Union enters into a CBA containing “union security
clause”.
Union Security
“Union security” is a generic term which is applied to and comprehends “closed
shop”, “union shop”, “maintenance of membership” or any other form of agreement
which imposes upon employees the obligation to acquire or retain union membership
as a condition affecting employment.
KINDS of Union Security Agreements
F Closed Shop
Only union members can be hired and workers must remain
as union members to retain employment.
F Union Shop
Non-members may be hired, but to retain employment must
become union members after a certain period.
F Modified Union Shop

Employees who are not union members at the time of
signing the contract need not join the union, but all workers hired
thereafter must join.
F Maintenance of Membership Shop

No employee is compelled to join the union, but all present
or future members, as a condition of employment, must remain in
good standing in the union.
F Exclusive Bargaining Shop

The union is recognized as the exclusive bargaining agent
for all employees whether union members or not.
F Bargaining for Member Only

A union is recognized as the bargaining agent only for its
own members.
F Agency Shop Agreement or

Maintenance of Treasury Shop
An agreement whereby employees must either join the
union or pay to the union as exclusive bargaining agent a sum equal
to that paid by the members.
NOTE: The above variations are opposite of OPEN SHOP, an arrangement

which does not require union membership as a good condition of
employment.
VALIDITY of Closed Shop Agreements

A closed-shop agreement is one whereby an employer binds himself to
hire only members of the contracting union who must continue to remain
members in good standing to keep their jobs. It is the most prized of unionism.

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Another reason for enforcing the closed-shop agreement is the principle of

sanctity or inviolability of contracts guaranteed by the Constitution.
ADVANTAGES of Closed Shop Agreement

F It increases the strength and bargaining power of labor
organizations.
F It prevents non-union workers from sharing in the benefits of the
union’s activities without also sharing its obligations.
F It prevents the weakening of labor organizations by discrimination
against union members.
F It eliminates the lowering of standards caused by competition with
non-union workers.
F It enables labor organizations effectively to enforce collective
agreements.
F It creates harmonious relations between the employer and the
employee.
DISADVANTAGES of Closed Shop Agreement

F It results in monopolistic domination of employment by labor
organization.
F It interferes with the freedom of contract and personal liberty of the
individual worker.
F It compels employers to discharge all non-union workers regardless
of efficiency, length of service, and others.
F It facilitates the use of labor organizations by unscrupulous union
leaders for the purpose of extortion, restrain of trade, and others.
F It denies to non-union workers equal opportunity for employment
F It enables union to charge exorbitant dues and initiation fees.
CLOSED SHOP shall not be Applicable to:

F Any employee who at the time the close shop agreement takes
effect is a bona fide member of religious organization, which
prohibits its members from joining union on religious grounds.
F Employees already in the service and already members of a labor
union or unions other than the majority union at the time the
closed shop agreement took effect.
F Supervisors ineligible under the Act to join the majority union
because of the membership therein of employees under their
supervision.
F Confidential employees who are excluded from the rank and file
bargaining unit; and
F Employees excluded from the closed shop by express terms of the
agreement.
DISMISSAL pursuant to a closed shop agreement must clearly appear in the

contract.

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• SIXTH ULP : “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 the Labor Code.
Indirect Discrimination
It shall be ULP for an employer to dismiss or discriminate against an employee
for having filed charges or for having given or about to give testimony under said Act.
• SEVENTH ULP : “VIOLATION OF THE DUTY TO BARGAIN”
To violate the duty to bargain collectively as prescribed by the Code.
• EIGHTH ULP : “PAID NEGOTIATION”
To pay negotiation or attorney’s fees to the union or its officers or agents as a part
of the settlement of any issue in collective bargaining or in any other dispute.
• NINTH ULP : “VIOLATION OF THE CBA”
To violate a collective bargaining agreement. The violation must be GROSS in order

to constitute as ULP.
XVIII
STRIKES AND LOCKOUTS
WORKERS shall have the right to engage in concerted activities for purposes of
collective bargaining or for their mutual benefit and protection.
LIMITATIONS
• Must be peaceful; and

• In accordance with law.
STRIKE
It means any temporary stoppage of work by the concerted action of employees as a
result of an industrial or labor dispute.
Characteristics of Strike
• There must be an established relationship between the strikers and the

person is against whom the striker is called.
• The relationship must be one of the employer and employee.

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• The existence of a dispute between the parties and the utilization by labor
of the weapon of concerted refusal to work as a means of persuading, or
coercing compliance with the working men ’s demands.
• The contention advanced by the workers that although work ceases, the
employment relation is deemed to continue albeit in a state of belligerent
suspension.
• There is work stoppage, which stoppage is temporary.
• The work stoppage is done through concerted action of the employees.
• The striking group is a LLO and in case of bargaining deadlock, is the
employees’ sole bargaining representative.
Kinds of Strike
• As to Extent
F General Strike
Extends over a whole community, province, state, or
country.
F Local / Particular Strike

One undertaken by workers in a particular enterprise,
locality, or occupation, it usually involves only one union or only
one industry.
• As to the Nature of the Act

F Strike Proper
F Sit-Down Strike
Occurs when a group of employees or other interested in
obtaining a certain objective in a particular business forcibly take
over possession of the property of such business, establish
themselves within the plant, stop its production and refuse access to
the owners or the others desiring to work.
F Slowdown
Willful reduction in the rate of work by a group of
employees for the purpose of restricting the output of the employer
F Partial/Quickie Strike
Takes the form of intermittent, unannounced work
stoppage, including slowdowns, unauthorized extension of rest
periods and walkouts for portions of a shift or for entire shifts.
WILDCAT Strike—work stoppage that violates the labor contract

and is not authorized by the union.
• As to Degree of Employee Interest

F Primary Strike
One declared by the employees who have a direct and
immediate interest, whether economic or otherwise, in the subject
of the dispute, which exist between them and their employer.
F Secondary Strike

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Coercive measure adopted by the workers against an

employer connected by product or employment with alleged unfair
labor condition or practice.
F Sympathetic Strike
One in which the striking employees have no demands or
grievances of their own, but strike for the purpose of directly or
indirectly aiding others, without direct relation to the advancement
of the interest of the strikers.
WELGA NG BAYAN—In the nature of a general strike which is but

an extended sympathetic strike; it is work stoppage
affecting numerous employers including a particular
employer who has no dispute with his employees
regarding their terms and conditions of employment.
• As to Purpose / Nature of Employee Interest
F Economic Strike
This is a strike held to force wage or concessions from the
employer, which he is not required by law to grant.
The CONVERSION Doctrine

A strike that may start as an economic strike and then as it
progresses, becomes an ULP, or vice versa.
NOTE: Strikers who are permanently replaced during the economic

phase of the strike are not entitled to immediate
reinstatement, while strikers replaced after the date of
conversion are entitle to reinstatement.
F ULP Strike
Called against the unfair labor practices of the employer,
usually for making him desist from further committing such
practice.
A strike that is provoked or prolonged by a refusal to bargain
or a discriminatory discharge or any sort of ULP by the employer.
ULP Strike in Good Faith

If the management performed acts, which under the
circumstances, the strikers believed were ULP on the part of the
management, although they were not, the court ruled that the strike
cannot be held illegal. However, the union’s belief needs some
rational basis.
TWO Tests in Determining

the Existence of ULP Strike
OBJECTIVE, when the strike is declared in protest of ULP that

is found to have been actually committed;
SUBJECTIVE, when a strike is declared in protest of what the

union believed to be ULP committed by the
management, and the circumstances warranted
such belief in good faith, although found
subsequently as not committed.

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Grounds for Strike
• Collective Bargaining Deadlock;

• ULP of the Employer;
Protection of Strike
• It is generally not subject to labor injunction.

• Employees may not be discriminated against merely because they have
exercised the right to strike.
• The use of strike-breakers is prohibited.
STRIKE–BREAKER - Is a person who obstructs, impedes, violence,

coercion, threats or intimidation any peaceful picketing by
employees during any labor controversy affecting wages, hours
or conditions of work in the exercise of right of self-organization
or collective bargaining
Mere participation in a strike does not sever the employment

relationship.
Role of the Police
The involvement of the AFP / PNP shall be limited to maintenance

of peace and order, enforcement of laws and legal orders of duly
constituted authorities and the performance of the specific functions as
may be provide by law.
Factors Affecting the Legality of a Strike
• STATUTORY PROHIBITION
Government employees have the right to organize, but they do not have
the right to strike. A strike held by them would be an illegal strike that violates
a legal prohibition.
No strike or lockout may be declared on grounds involving inter-union
and intra-union disputes or an issue brought to voluntary or compulsory
arbitration.
• PROCEDURAL REQUIREMENTS
F Notice of Strike
Notice of strike (or lockout), with the required contents, should
be filed with the DOLE, specifically the regional branch of NCMB, with
a copy furnished to employer or the union, as the case may be.
WHO Can File a Notice of Strike?

~ If the reason is bargaining deadlock, only the bargaining
union has the legal right to file a notice of strike.
~ If the reason is ULP, only a LLO (assuming there is no

recognized or certified bargaining agent).
F Cooling – Off Period

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It is a time gap to cool-off tempers between the filing of notice

and the actual execution of strike (or lockout).
THE Cooling – Off Period is:
~ In case of BARGAINING DEADLOCK: 30 Days
~ In case of ULP: 15 Days
UNION BUSTING
In the face of UNION BUSTING where the union’s existence is

threatened, the cooling – off period need NOT be observed.
UNION Busting Exists When:

~ The union officers are being dismissed;
~ Those officers are duly elected in accordance with
the union CBL;
~ The existence of the union is threatened.
F Strike (or Lockout) Vote

Before a strike [or a lockout] may actually be started, a strike or
lockout vote should be taken by secret balloting, with 24 – hour prior
notice to NCMB.
The DECISION to declare a strike requires the secret – ballot

approval of majority (50% + 1) of the total union membership in the
bargaining unit concerned.
A LOCKOUT needs the secret ballot concurrence of majority of the

directors or partners.
F Strike (or Lockout) Vote Report

The result of the strike vote (or lockout vote) should be reported
to the NCMB at least seven (7) days before the intended strike or
lockout, subject to the cooling – off period.
AFTER the strike vote is taken, seven (7) days must pass before
the union can actually commence the strike. A strike held within the
seven (7) – day waiting period is plainly illegal.
COMPUTATION
Seven days are added to the 15-day or 30-day period.
F Declaration of Strike / Lockout

If the dispute remains unsettled after the lapse of the cooling –
off period and the seven (7) – day reporting period, the labor union may
strike or the employer may lockout its workers.
NOTE: Failure to comply with the mandatory procedural requirements

is fatal to the legality of a strike / lockout.
• UNLAWFUL PURPOSE
The law does not expressly ban strikers except when enjoined against
by the court; but if a striker is declared for a trivial, unjust, or unreasonable
purpose, or if it is carried out through unlawful means, the law will not

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sanction it and the court will declare it illegal, with the adverse consequences
to the strikers.
• MEANS AND METHODS

Limitations
No person engaged in picketing shall:
F Commit any act of violence, coercion or intimidation, or
F Obstruct the free ingress to or egress from the employer’s premises
for lawful purposes, or
F Obstruct public thorough fares.
• PENALTY
Article 289, of the Revised Penal Code provides: “The penalty of arresto
mayor and a fine not exceeding 300 pesos shall be imposed upon any person
who, for the purpose of organizing, maintaining or preventing coalitions of
capital or labor, strike of laborers or lockouts of employers shall employ
violence or threats in such a degree as to compel or force the laborers or
exercise of their industry or work, if the act shall not constitute a more serious
offense in accordance with the provision of the Code”.
NOTE: EVEN if the purpose of a strike is valid, the strike may be held invalid
where the means employed are illegal.
• INJUNCTION
No temporary or permanent injunction or restraining order in any case

involving or growing out of labor disputes shall be issued by any court or other
entity, except as otherwise provided in Article 218 and 264 of this Code (Art.
254).
Article 218 (e) empowers the NLRC to enjoin or restrain any actual or
threatened commission of any or all prohibited or unlawful acts to require the
performance of a particular act in any labor dispute, or in cases involving
“national interest” as provided in Article 263 (g).
Automatic Injunction
Injunction in “national interest” cases is expressly allowed, in fact,
an injunction may be issued automatically, that is even if none of the
parties asks for it.
Assumption of Jurisdiction
and Certification to the NLRC
When, in his opinion there exists a labor dispute causing or likely to
cause a strike or lockout in an industry indispensable to the national
interest, the Secretary of Labor may assume jurisdictio n over the dispute
and decide it or certify the same to the NLRC for compulsory arbitration.
Effect of Assumption or Certification

Such assumption or certification has the effect of automatically
enjoining the intended or impending strike or lockout as specified in the
assumption or certification order. If the one has already taken place at the
time of assumption or certification, all striking or locked out employees
shall immediately return to work and the employer shall immediately
resume operations and readmit all workers under the same terms and
conditions prevailing before the strike or lockout.

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Striking workers must cease and/or desist from all acts that tend to,
or undermine the authority of the Secretary of Labor, once the assumption
and/or certification order is issued. They cannot ignore return-to-work
orders, citing ULP on the pert of the company, to justify their actions.
If it is an economic strike, the strikers are bound to the provision

but if it is a ULP strike, the strikers are not bound to such provision.
LOCKOUT
Means the temporary refusal of any employer to furnish work because of an industrial
or labor dispute.
Grounds for Lockout

• Collective Bargaining Deadlock
• ULP Act of a Union
Requisites
• Notice of intention to declare a lockout has been filed with the DOLE;
• At least 30 days has elapsed since the filing of notice before lockout is declared;
• An impasse had resulted in the negotiations; and
• Lockout is not discriminatory.
NOTE: Lockout is valid where, in the course of a labor dispute, it is undertaken as
a defensive weapon, or in pursuance of the employer’s interest.
Unlawful Lockout
Where it is declared in order to defeat organizational and bargaining right
employees.
PROHIBITED ACTIVITIES
• No labor organization or employer shall declare a strike or lockout without first

having bargained collectively in accordance with Title VII of this Book or without
having filed the required notice or without the necessity strike or lockout vote first
having been obtained and reported.
• No strike or lockout shall be declared after assumption of jurisdiction by President
or the Sec of Labor or after certification or submission of the dispute to compulsory
/ voluntary arbitration or during the pendency of cases involving the same grounds
for the strike or lockout.
• No person shall obstruct, impede or interfere with by force, violence, coercion,
threats or intimidation any peaceful picketing by employees during any
controversy or in the exercise of the right to self-organization or collective bargain
or shall aid or abet such obstruction or interference.
• No employer shall use or employ any strikebreaker, nor shall any person be
employed as a strikebreaker.
• No public official or employee, including officers and personnel of the AFP or the
PNP, or armed person shall bring in, introduce or escort in any manner any
individual who seeks to replace strikers in entering or leaving the premises of a
strike area, or work in place of the strikers. The police force shall keep out of the
picket lines unless or other criminal acts occur therein. Nothing herein shall be
interpreted to prevent any public officer from taking any measure necessary to

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maintain peace and order, protect life and property, and/or enforce the law and
legal order.
• No person engaged in picketing shall commit any act of violence, coercion or
intimidation or obstruct the free ingress or egress from the employer’s premises for
lawful purposes, or obstruct public through fares.
PENALTY FOR VIOLATION
Any person violating the above provisions shall be punished by a fine of not less than
P1,000.00 nor more than P10,000.00 and/or imprisonment for not less than 3 months. Nor
more than 3 years, or both such fine and imprisonment, at the discretion of the court.
Prosecution under Article 272 of the LCP shall preclude prosecution for the same act
under the RRC, and vice versa.
CONSEQUENCES OF STRIKE AND LOCKOUT
• Strikers’ Retain their Employment

Strikers remain as employees while they are on strike; the effects of
employment are merely suspended during that time. When the strike is over, the
employees go back to work and the effects of employer – employee relationship are
resumed.
• Striker’s Lose their Employment

IF Striker is a UNION MEMBER, there must be proof that he committed
illegal acts during a strike. Mere participation of an ordinary worker in al illegal
strike cannot be a ground for termination of his or her employment.
NOTE: Mere participation of a worker in a lawful strike shall not constitute

sufficient ground for termination of his employment, even if the
employer had hired a replacement during such lawful strike.
IF Striker is a UNION OFFICER, s/he may be terminated from work

when s/he knowingly participates in an illegal strike, or when s/he commits an
illegal act during the strike.
NOTE: The penalty of dismissal for participating in an illegal strike is

limited ONLY to the union leaders. Penalty may be scaled down to
suspension.
WHO Dismisses Illegal Strikers?
The law grants the employer the option of declaring a union officer who
participated in an illegal strike as having lost his employment.
• Claim of Back Wages in an Economic Strike

The strikers are NOT entitled to back wages on the principle that “a fair
day’s wage” accrues only for a “fair day’s labor” (no work, no pay policy).
Exception:
F The strike is legal;
F There is an unconditional offer to return to work; and

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F There is a refusal on the part of the employer to accept strikers to

work.
In an ULP Strike
Strikers who were discriminatorily dismissed OR affected by the ULP are

ENTITLED to back wages. The law on illegal dismissal applies.
In a LOCKOUT
Any worker whose employment has been terminated as a consequence of

an unlawful lockout shall be ENTITLED to reinstatement with full back wages.
EMPLOYER’S RIGHT TO HIRE

REPLACEMENTS DURING STRIKE
OR REINSTATEMENT OF STRIKERS
During the pendency of an economic strike, the employer may hire replacements on a
permanent basis and is not bound to discharge such permanent replacement in the event that
strikers resume to work.
While replacement may also be hired by the employer to take the places left vacant by
employees engaged in an ULP strike, such replacements are not permanent and their
employer is under the duty to dismiss them as soon as the strikers request reinstatement in
their previous positions.
IMPROVED OFFER OR REDUCED

OFFER BALLOTING (ART. 265)
The DOLE shall conduct a referendum by secret balloting on the improved offer of the
employer on or before the 30th day of strike. When at least a majority of the union members
vote to accept the improved offer, the striking workers shall immediately return to work and
the employer shall thereupon readmit them upon the signing of the agreement.
In cases of lockout, the DOLE shall also conduct a referendum by secret balloting on
the reduced offer of the union on or before the 30th day of the lockout. When at least a
majority of the board of directors or trustees or the partners holding the controlling interests in
the case of a partnership vote to accept the reduced offer, the workers shall immediately
return to work and the employer shall thereupon readmit them upon the signing of the
agreement.
PICKETING
The presence of striking workers or their union brothers who pace back and forth
before the place of business of an employer considered “unfair to organize labor” in the hope of
being able to persuade peacefully other workers not to work in the establishment, and
customers not do business there.
Limitations
Picketing conducted as to amount to a nuisance is unlawful. Picketing maybe

considered as a nuisance if it constitutes an obstruction to the free use of property, so
as substantially to interfere with the comfortable enjoyment of life or property, or if it

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constitutes an unlawful obstruction to the free passage or use, in the customary

manner of a street.
Picketing carried on with intimidation, threats, coercion, or force is unlawful

however laudable the strikers’ motive or purpose, and regardless of whether the
intimidated persons are their employers, co-employees, or customers.
Vandalism and acts of a less terroristic nature that are designed to cause
physical discomfort to the employer’s customers are also unlawful.
Untruthful picketing is unlawful even though its purpose is valid. False

statements are not constitutionally protected free speech.
The PUBLIC EASEMENT OF WAY and PASSAGE permits of pickets to

parade in front of or near the picketed establishment. As members of the general
public, they have the right, as one of passage – a pedestrian right. It does not create the
additional right of squatting or assembly on this portion of the employer’s land.
OTHER CONCERTED ACTIVITIES
• Collective Letter
Constitutes an informal action participated in by at least two employees for
“mutual aid or protection” in regard to their interests.
• Publicity
Members of a labor union may make known the facts of a labor dispute by
sign, handbill, or newspaper advertisement as a legitimate means of economic
coercion.
NOTE: It is unlawful for a labor organization in a radio broadcast to express its

honest opinion as to the fairness of an employer toward organized labor
and to advise the public and friends of labor not to patronize him.
HOWEVER, the use of loud speakers in front of a picketed place of business
has been condemned as form of intimidation.
• Boycott
An attempt, by arousing a fear of loss, to coerce others, against their will to
withhold from one denominated “unfriendly to labor” their beneficial business
intercourse.
Kinds of Boycott
F Primary Boycott
Applied directly and alone to the offending person by
withdrawing from him all business relations on the part of the
organization that initiated the boycott.
F Secondary Boycott
A combination not merely to refrain from dealing with a person,
or to advise or by peaceable means persuade his customers to refrain,
but to exercise coercive pressure upon such customers, actual or
prospective, in order to cause them to withhold or withdraw patronage
from him through fear of loss or damage to themselves should they deal
with him.

Labor Relations 83
Labor law reviewer
_________________________________ __________________________________
Means and Methods

Boycott maybe lawful or unlawful depending on the means and
methods employed and the ends intended to be accomplished. Its lawfulness
may also depend upon whether it is used against the industrial antagonist
directly or against an outsider because of his influence on or connection with
the industrial antagonist.
Maybe in the form of a refusal of a labor union to allow its members to
handle products of the employer or to work on materials from non – union
shops, or to work on a job upon which a contract or with whom they are at
variance in an existing labor dispute.
• Slowdown
Method by which one’s employees without seeking a complete stoppage of work,

retard production and distribution in an effort to compel compliance by the
employer with the labor demands made upon him.
ARREST AND DETENTION
EXCEPT on the grounds of national security and public peace, or in case of commission
of crime, no union members or union organizers may be arrested or detained for union
activities with previous consultation with the Secretary of Labor.
XIX
FOREIGN INVOLVEMENT
IN TRADE UNION ACTIVITIES
PROHIBITION AGAINST ALIENS
ALL ALIENS, natural or juridical, as well as foreign organizations are strictly prohibited
from engaging directly or indirectly in all forms of trade union activities without prejudice to
normal contracts between Philippine Labor Unions and recognized international labor centers
EXCEPTIONS
• Aliens working in the country with valid permits issued by the DOLE may
exercise the right to self-organization and join or assist labor organizations
of their own choosing for purposes of collective bargaining.
• Said aliens are nationals of a country which grants the same or similar
rights to Filipino Workers.
REGULATION OF FOREIGN ASSISTANCE
No foreign individual, organization or entity may give any donations, grants or other
forms of assistance, in cash or in kind, directly or indirectly, to any labor organization, group
of workers or any auxiliary thereof, such as cooperatives, credit unions and institutions

Labor Relations 84
Labor law reviewer
_________________________________ __________________________________
engaged in research, education, or communication, in relation to trade union activities without

prior permission by the Secretary of Labor.
NOTE: This prohibition shall equally apply to foreign donations grants or other forms of
assistance, in cash or in kind, given directly or indirectly to any employer or employer’s
organization to support any activity or activities affecting trade unions
The Secretary of Labor shall promulgate rules and regulations to regulate and
control the giving and receiving of such donations, grants, or other forms of assistance,
including the mandatory reporting of amounts of donations or grants, the specific
recipients thereof, the projects or activities proposed to be supported and their
duration
“TRADE UNION ACTIVITIES”
The phrase shall mean:
• Organization, formation and administration of labor organizations;
• Negotiation and administration of CBA;
• All forms of concerted union activities;
• Organizing, managing, or assisting union conventions, meeting rallies,
referenda, teach – ins, seminars, conferences and institutes;
• Any form of participation or involvement in representation proceedings,
representation proceeding, representation elections, consent elections,
union elections; and
• Other activities or actions analogous to the foregoing.

(SLU 2009) Labor Relations Reviewer

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(SLU 2009) Labor Relations Reviewer

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LABOR LAW REVIEWER

KRIS DYAN CAYABYAB

RYAN SOLANO MYKEEDOX

MAAN BAGUIOEN LOUIE SAJONIA

BRENSON SIADTO JED ALLAN BEJAR

NORWAYNE SALMAN BRENNER BENGWAYAN

ATTY. HILARIO JUSTINO F. MORALES

LABOR LAW SECTION

Team 2009 Team 2008

BRENSON SIADTO Section Chief RACHELLE ANN LAZAGA

Editorial Consultant & Adviser

ATTY. LEILANEE Q. DASIG – QUANGUEY

Copyright © 2009 Bar Operations Committee

ALL RIGHTS R ESERVED

2. to promote free trade unionism as and instrument of for the enhancement of

4. to promote the enlightenment of workers concerning their rights and obligations as

5. to provide an adequate administrative machinery for the expeditious settlement of

6. to ensure a stable but dynamic and just industrial peace;

7. to ensure the participation of workers in decision and policy-making process affecting

WHO ARE EMPLOYEES?

The term EMPLOYEES shall include:

WHO ARE EMPLOYERS?

S AINT L OUIS U NIVERSITY | College of Law | B AR O P E R A T I O N S C O M M I T T E E (2009)

Subject Matter (Dispute Concerns)

• Terms or conditions of employment; or

KINDS OF LABOR DISPUTES

Labor Standards Disputes

Labor Relations Disputes

• Organizational Right Dispute/ULP

REMEDIES IN LABOR DISPUTES

• Grievance Procedure • Certification to NLRC

S AINT L OUIS U NIVERSITY | College of Law | B AR O P E R A T I O N S C O M M I T T E E (2009)

THE COMMISSION is composed of a Chairman and twenty-three (23) members.

(SEE R.A. 9347; June 24, 2006)

• Chairman and other Commissioners

1. shall be members of the Philippine Bar;

1. must be members of the Philippine Bar;

The CHAIRMAN, DIVISION PRESIDING COMMISSIONERS, and other COMMISSIONERS are

L ABOR ARBITERS are appointed by the President upon recommendation of the

S AINT L OUIS U NIVERSITY | College of Law | B AR O P E R A T I O N S C O M M I T T E E (2009)

• Unfair labor practices cases / gross violation of CBA.

• Cases certified to it for COMPULSORY ARBITRATION by the President or Sec. of Labor

S AINT L OUIS U NIVERSITY | College of Law | B AR O P E R A T I O N S C O M M I T T E E (2009)

POWERS OF THE NLRC

• Power to Issue Compulsory Processes

S AINT L OUIS U NIVERSITY | College of Law | B AR O P E R A T I O N S C O M M I T T E E (2009)

• All inter-union conflicts;

ADMINISTRATIVE FUNCTIONS OF BLR / LR DIVISION

• Regulation of registration of Labor Unions;

DEPARTMENT ORDER NO . 9 (Decisions on Intra Union Disputes), provides that

S AINT L OUIS U NIVERSITY | College of Law | B AR O P E R A T I O N S C O M M I T T E E (2009)

ORIGINAL AND EXCLUSIVE JURISDICTION

To hear and decide the following:

• Disputes arising from interpretation or enforcement of company personnel

Period to File an Appeal

If the decision, resolution, or orders are made by the REGIONAL DIRECTOR of

Grounds for Appeal

• Prima facie evidence of abuse of discretion;

S AINT L OUIS U NIVERSITY | College of Law | B AR O P E R A T I O N S C O M M I T T E E (2009)

Requirements for Appeal to the NLRC

• Appeal shall be filed within the reglementary period;

The requirement of posting of bond, although jurisdictional, was given liberal

A party is allowed to file a MOTION FOR RECONSIDERATION of any order, resolution or

The Requirement of a Motion for