A Compilation of the

Questions and Suggested Answers

In the

PHILIPPINE BAR EXAMINATIONS 2014-2019

In

LABOR LAWS AND SOCIAL LEGISLATION

Compiled and Arranged By:

BELTRAN, Ayana Jane

JARANILLA, Karrenh Viann

REY, Christian Immanuel

New Era University-College of Law

May 2021
 FOREWORD

This is a compilation of the SUGGESTED and ALTERNATIVE

ANSWERS to the Bar Examination Questions in Labor Laws and

Social Legislation that we compiled and arranged, as students of

New Era University, under the mentorship and supervision of Atty.

Severo C. Madrona, Jr. LL.M, Ph.D.

The compilation was inspired by the work of Siliman

University’s College of Law, producing a reliable material to persons

who will take the Bar Examinations, as well as to everyone involved

in the legal profession. Like their material, this may also be

considered a free material in order to help our co-students in their

study of Labor Laws and Social Legislation.

The basis of our suggested answers mostly originated from the

provisions of the applicable laws and jurisprudence. The answers

(views and opinions) presented in this reviewer are solely those of

the authors in the given references and does not necessarily represent

us, as authors of this work.

THE AUTHORS

ii LABOR LAW AND SOCIAL LEGISLATION BAR Q&A

 TABLE OF CONTENTS

Page
Title Page i
Foreword ii
Table of Contents iii

CONSTITUTIONAL PROVISIONS

XRight to Self-Organization 1

LABOR STANDARDS

XEmployer-Employee Relationship 2
Kinds of Employees 14
Stipulation Against Marriage 17
Wages 17
Wage Distortion 18
Employee Benefits 19
Diminution of Benefits 22
Meal Break 23
Facilities 23
Maternity Leave 24
Disability Benefits 25
Compensable Illness 26
Holiday Pay 27
Wage Order 27
Service Incentive Leave 29
Fixed-Term Employee 30
Contractor and Subcontractor 33
Job Contracting : Labor Only Contracting 34
Independent Contractor 38
Migrant Workers 38
Househelper/Kasambahay 43
Apprentice and Learnership 43

LABOR LAW AND SOCIAL LEGISLATION BAR Q&A ii

i
 LABOR RELATIONS

XLabor Organization; Requisites 44

Modes of Determining Exclusive Bargaining Agreement 44
Collecting Bargaining Agreement 45
Certification Election 46
Strike 50
Unfair Labor Practice 55
Grievance Machinery 55
Quitclaim 56
Bureau of Labor Relations 57
National Labor Relations Commission 57
Jurisdiction of the NLRC 58
Jurisdiction of the Voluntary Arbitrator 61
Jurisdiction of the Labor Arbiter 63
Liberal Interpretation 63
Visitorial and Enforcement of Power of the DOLE 64
Jurisdiction of the Secretary of Labor 65
Assumption of Jurisdiction of the Secretary of Labor 66
Resignation vs. Constructive Dismissal 67
Termination: Due Process 68
Just Causes 71
Authorized Causes 75
Reinstatement 76
Backwages 78
Recovery of Backwages by the Employer 79
Attorney’s Fee and Legal Interest 80
Appeal Bond 81
Prescription Period 82
Retrenchment 83
Separation Pay 84
Retirement 85
Death 87

iv LABOR LAW AND SOCIAL LEGISLATION BAR Q&A

 CONSTITUTIONAL PROVISIONS : RIGHT TO SELF-ORGANIZATION

2014 BAR QUESTION: Which of the following groups does not enjoy the right
to self-organization? (1%)

(A) those who work in a non-profit charitable institution

(B) those who are paid on a piece-rate basis

(C) those who work in a corporation with less than ten (10) employees

(D) those who work as legal secretaries

SUGGESTED ANSWER:

(D) those who work as legal secretaries (Tunay na Pagkakaisa ng Manggagawa

sa Asia Brewery v. Asia Brewery, Inc., G.R. No. 162025, August 3, 2010).

2014 BAR QUESTION: Philhealth is a government-owned and controlled

corporation employing thousands of Filipinos. Because of the desire of the
employees of Philhealth to obtain better terms and conditions of employment
from the government, they formed the Philhealth Employees Association (PEA)
and demanded Philhealth to enter into negotiations with PEA regarding terms
and conditions of employment which are not fixed by law. (4%)

(A) Are the employees of Philhealth allowed to self-organize and form PEA and
thereafter demand Philhealth to enter into negotiations with PEA for better terms
and conditions of employment?

SUGGESTED ANSWER:

Yes. Employees of Philhealth are allowed to selforganize under Sec. 8, Art. III
and Sec. 3, Art. XIII of the Constitution which recognize the rights of all
workers to self-organization. They cannot demand, however, for better terms
and conditions of employment for the same are fixed by law (Art. 244, Labor
Code), besides, their salaries are standardized by Congress (Art. 276, Labor
Code).
(B) In case of unresolved grievances, can PEA resort to strikes, walkouts, and
other temporary work stoppages to pressure the government to accede to their
demands?

SUGGESTED ANSWER:

No. Since the terms and conditions of government employment are fixed by
law, government workers cannot use the same weapons employed by workers
in the private sector to secure concessions from their employers (Blaquera v.
Alcala, G.R. Nos. 109406. 110642, 111494, 112056, 119597, September 11, 1998).

EMPLOYER-EMPLOYEE RELATIONSHIP

2017 BAR QUESTION: What are the accepted tests to determine the existence of
an employer-employee relationship? (5%)

SUGGESTED ANSWER:

The accepted tests to determine the existence of an employer-employee

relationship are as follows:

a. The four-fold test

To ascertain the existence of an employer - employee relationship
jurisprudence has invariably adhered to the four-fold test, to wit: (1) the
selection and engagement of the employee; (2) the payment of wages; (3)
the power of dismissal; and (4) the power to control the employee's
conduct, or the so-called "control test." (Philippine Global
Communication, Inc. v. De Vera, G.R. No. 157214, June 7, 2005, 459 SCRA
260, 268)

b. Two-tiered test
The two-tiered test involves: "(1) the putative employer's power to
control the employee with respect to the means and methods by which
the work is to be accomplished; and (2) the underlying economic
realities of the activity or relationship," has been made especially
appropriate in cases where there is no written agreement to base the
relationship on and where the various tasks performed by the worker
brings complexity to the relationship with the employer. (Antonio
 Valeroso and Allan Legatona, v. Skycable Corporation, G.R. No. 202015,
July 13, 2016)

2014 BAR QUESTION: Linda was employed by Sectarian University (SU) to

cook for the members of a religious order who teach and live inside the campus.
While performing her assigned task, Linda accidentally burned herself. Because
of the extent of her injuries, she went on medical leave. Meanwhile, SU engaged
a replacement cook. Linda filed a complaint for illegal dismissal, but her
employer SU contended that Linda was not a regular employee but a domestic
househelp. Decide (4%)

SUGGESTED ANSWER:

The employer’s argument that Linda was not a regular employee has no merit.
The definition of domestic servant or househelper contemplates one who is
employed in the employer’s home to minister exclusively to the personal
comfort and enjoyment of the employer’s family. The Supreme Court already
held that the mere fact that the househelper is working in relation to or in
connection with its business warrants the conclusion that such househelper or
domestic servant is and should be considered as a regular employee (Apex
Mining Co., Inc. v. NLRC, G.R. No. 94951, April 22, 1991). Here, Linda was
hired not to minister to the personal comfort and enjoyment of her employer’s
family but to attend to other employees who teach and live inside the campus.

ALTERNATIVE ANSWER:

The complaint for illegal dismissal should be dismissed. There was no

showing that in hiring the replacement cook, SU severed its employer-
employee relationship with Linda. In illegal dismissal cases, an employee
must first establish, by substantial evidence, the fact of dismissal before
shifting to the employer the burden of proving the validity of such dismissal
(Grand Asian Shipping Lines, Inc. v. Wilfred Galvez, G.R. No. 178184, January
29, 2014). Here, Linda’s dismissal was not clearly established.

2014 BAR QUESTION: Lionel, an American citizen whose parents migrated to

the U.S. from the Philippines, was hired by JP Morgan in New York as a call
center specialist. Hearing about the phenomenal growth of the call center
industry in his parents’ native land, Lionel sought and was granted a transfer as
a call center manager for JP Morgan’s operations in Taguig City. Lionel’s
employment contract did not specify a period for his stay in the Philippines.
After three years of working in the Philippines, Lionel was advised that he was
being recalled to New York and being promoted to the position of director of
international call center operations. However, because of certain “family
reasons,” Lionel advised the company of his preference to stay in the Philippines.
He was dismissed by the company. Lionel now seeks your legal advice on: (6%)

SUGGESTED ANSWER:

(A) whether he has a cause of action

Lionel has a cause of action; he was illegally dismissed. Dismissal due to an

employee’s refusal of a promotion is not within the sphere of management
prerogative. There is no law that compels an employee to accept promotion
(Dosch v. NLRC, G.R. No. L-51182, July 5, 1983).

(B) whether he can file a case in the Philippines

Yes. Since this is a case of illegal dismissal, the Labor Arbiters have
jurisdiction over the same (Art. 217 (a) (2), Labor Code). Under the 2011 NLRC
Rules of Procedure, all cases which Labor Arbiters have authority to hear and
decide, may be filed in the Regional Arbitration Branch having jurisdiction
over the workplace of the complainant or petitioner (Rule IV, Sec. 1).

(C) what are his chances of winning

He has a big chance of winning. An employee cannot be promoted without his

consent, even if the same is merely a result of a transfer, and an employee’s
refusal to accept promotion cannot be considered as insubordination or willful
disobedience of a lawful order of the employer. In this case, JP Morgan cannot
dismiss Lionel due to the latter’s refusal to accept the promotion (Norkis
Trading Co., Inc. v. Gnilo, G.R. No. 159730, February 11, 2008, 544 SCRA 279).

ALTERNATIVE ANSWER:

His chances of winning is nil because the objection to the transfer was
grounded solely on personal “family reasons” that will be caused to him
because of the transfer (OSS Security & Allied Services, Inc. v. NLRC, G.R.
No. 112752, February 9, 2000, 325 SCRA 157); Phil. Industrial Security Agency
Corp. v. Dapiton, G.R. No. 127421, December 8, 1999, 320 SCRA 124).
2014 BAR QUESTION: Don Luis, a widower, lived alone in a house with a large
garden. One day, he noticed that the plants in his garden needed trimming. He
remembered that Lando, a 17-year old out-of-school youth, had contacted him in
church the other day looking for work. He contacted Lando who immediately
attended to Don Luis’s garden and finished the job in three days. (4%)

(A) Is there an employer-employee relationship between Don Luis and Lando?

SUGGESTED ANSWER:

Yes. All the elements of employer-employee relationship are present, viz: 1.

the selection and engagement of the employee; 2. the power of dismissal; 3. the
payment of wages; and 4. the power to control the employee’s conduct. There
was also no showing that Lando has his own tools, or equipment so as to
qualify him as an independent contractor.

ALTERNATIVE ANSWER:

None. Lando is an independent contractor for Don Luis does not exercise
control over Lando’s means and method in tending to the former’s garden.

(B) Does Don Luis need to register Lando with the Social Security System (SSS)?

SUGGESTED ANSWER:

Yes. Coverage in the SSS shall be compulsory upon all employees not over
sixty (60) years of age.

ALTERNATIVE ANSWER:

No. Lando is not an employee of Don Luis. What the parties have is a contract
for a piece of work which. while allowed by Art. 1713 of the Civil Code, does
not make Lando an employee under the Labor Code and Social Security Act.

2016 BAR QUESTION: Gregorio was hired as an insurance underwriter by the

Guaranteed Insurance Corporation (Guaranteed). He does not receive any salary
but solely relies on commissions earned for every insurance policy approved by
the company. He hires and pays his own secretary but is provided free office
space in the office of the company. He is, however, required to meet a monthly
quota of twenty (20) insurance policies, otherwise, he may be terminated. He was
made to agree to a Code of Conduct for underwriters and is supervised by a Unit
Manager.

(A) Is Gregorio an employee of Guaranteed? Explain. (2.5%)

SUGGESTED ANSWER:

No. Gregorio is not an employee of Guarantee. Result-wise, Guaranteed

Insurance Corporation can impose production quotas to Gregorio or any of its
agents to management policy decisions that the element of control under labor
law cannot reach. The company’s code of conduct, all of which do not intrude
into Gregorio’s means and manner of conducting his sales and only control
him as to the desired results is not the concept of control contemplated under
the labor law. The court held that a commitment to abide by the rules and
regulations of an insurance company does not ipso facto make the insurance
agent an employee. Neither do guidelines somehow restrictive of the
insurance agent’s conduct necessarily indicate "control" as this term is defined
in jurisprudence. Guidelines indicative of labor law "control," as the first
Insular Life case tells us, should not merely relate to the mutually desirable
result intended by the contractual relationship; they must have the nature of
dictating the means or methods to be employed in attaining the result, or of
fixing the methodology and of binding or restricting the party hired to the use
of these means. In fact, results-wise, the principal can impose production
quotas and can determine how many agents, with specific territories, ought to
be employed to achieve the company’s objectives. These are management
policy decisions that the labor law element of control cannot reach. (Gregorio
Tongko vs. Manulife and Renato Vergel De Dios, G.R. No. 167622, June 29, 2010,
570 SCRA 503, Brion, J.; Caingat Jr., 2020, Bar Reviewer Labor and Social
Legislation, pp 50)

(B) Suppose Gregorio is appointed as Unit Manager and assigned to supervise

several underwriters. He holds office in the company premises, receives an
overriding commission on the commissions of his underwriters, as well as a
monthly allowance from the company, and is supervised by a branch manager.
He is governed by the Code of Conduct for Unit Managers. Is he an employee of
Guaranteed? Explain. (2.5%)

SUGGESTED ANSWER:
No. Gregorio is not an employee of Guaranteed. As a matter of Insurance
practice, an agency relationship prevails in the insurance industry and not an
employer-employee relationship. A commitment to abide by the Code of
Conduct for Unit Managers does not “ipso facto” make a Unit Manager, like
Gregorio, an employee. Guidelines indicative of labor law “control” must
have the nature of dictating Gregorio’s means and methods in attaining his
desired result or of fixing or restricting his methodology in settling the
insurance, which, unfortunately, is absent in this case. (Gregorio Tongko vs.
Manulife and Renato Vergel De Dios, G.R. No. 167622, June 29, 2010, 570
SCRA 503, Brion, J.; Caingat Jr., 2020, Bar Reviewer Labor and Social
Legislation, pp 50-51)

2016 BAR QUESTION: Matibay Shoe and Repair Store, as added service to its
customers, devoted a portion of its store to a shoe shine stand. The shoe shine
boys were tested for their skill before being allowed to work and given ID cards.
They were told to be present from the opening of the store up to closing time and
were· required to follow the company rules on cleanliness and decorum. They
bought their own shoe shine boxes, polish, and rags. The boys were paid by their
customers for their services but the payment is coursed through the store's
cashier, who pays them before closing time. They were not supervised in their
work by any managerial employee of the store but for a valid complaint by a
customer or for violation of any company rule, they can be refused admission to
the store. Were the boys employees of the store? Explain. (5%)

SUGGESTED ANSWER:
Yes. The boys were employees of the store. Employee-employer
relationship is determined by the following elements, namely:

(a) the selection and engagement of the employee;

(b) the payment of wages;
(c) the power of dismissal; and
(d) the power of control the employee’s conduct or the so-called “control
test”.

The existence of the first three elements are supported by the following
circumstances, respectively: (1) they were provided with their ID cards and
allowed to occupy a portion of the store to be their shoe stand; and (2) the
cashier pays their salaries out of the payments made by the customers; and (3)
they can be barred entry into the store for violation of company rules.
 Lastly, the fourth element which is the power of control is likewise present
when the store required the boys not only to be present commencing from its
opening up to the closing time, but also to follow the company rules and
proper decorum. (Bar Reviewer Labor and Social Legislation, Caingat Jr., 2020,
pp 28)

2016 BAR QUESTION: Jim is the holder of a certificate of public convenience for
a jeepney. He entered into a contract of lease with Nick, whereby they agreed
that the lease period is for one (1) year unless sooner terminated by Jim for any of
the causes laid down in the contract. The rental is thirty thousand pesos
(P30,000.00) monthly. All the expenses for the repair of the jeepney, together with
expenses for diesel, oil and service, shall be for the account of Nick. Nick is
required to make a deposit of three (3) months to answer for the restoration of
the vehicle to its good operating condition when the contract ends. It is
stipulated that Nick is not an employee of Jim and he holds the latter free and
harmless from all suits or claims which may arise from the implementation of the
contract. Nick has the right to use the jeepney at any hour of the day provided it
is operated on the approved line of operation.

After five (5) months of the lease and payment of the rentals, Nick became
delinquent in the payment of the rentals for two (2) months. Jim, as authorized
by the contract, sent a letter of demand rescinding the contract and asked for the
arrearages. Nick responded by filing a complaint with the NLRC for illegal
dismissal, claiming that the contract is illegal and he was just forced by Jim to
sign it so he can drive. He claims he is really a driver of Jim on a boundary
system and the reason he was removed is because he failed to pay the complete
daily boundary , of one thousand (P1,000.00) for 2 months due to the increase in
the number of tricycles.

a. Jim files a motion to dismiss the NLRC case on the ground that the
regular court has jurisdiction since the agreement is a lease contract.
Rule on the motion and explain. (2.5%)

SUGGESTED ANSWER:

Jim’s motion to dismiss must be denied. The relationship between Jim as jeep
owner and Nick as jeepney driver is that of employer-employee and not of
lessor lessee. The existence of employer-employee relationship is determined
by law and not by the agreement of parties. Even if Nick takes material
possession of the jeep, Jim, as the holder of certificate of public convenience, is
entitled to exercise supervision and control over his drivers by seeing to it that
they follow the route as prescribed by law. Moreover, Nick has been engaged
to perform an activity which is usually necessary or desirable in the usual
trade or business of Jim. (Paguio Transport Corporation vs. NLRC and
Wilfredo Melchor, G.R. No. 119500, August 28, 1998, 294 SCRA 657, Panganiban,
J.)

b. Assuming that Nick is an employee of Jim, was Nick validly

dismissed?

SUGGESTED ANSWER:

Yes, Nick’s dismissal was valid the default on the part of Nick to pay Jim two
(2) monthly rentals is a just cause for termination. Their contract would be of
no force and effect should Nick simply disregard his monthly obligation to
Jim to the prejudice of the latter’s business. Nick’s conduct is analogous to
serious misconduct which is a just cause of dismissal. (Villamaria, Jr., vs.
Court of Appeals, 487 SCRA 571, G.R. No. 165881, April 19, 2006, Callejo, Sr., J.
with reference to Cosmos Bottling vs. Wilson Fermin, G.R. No. 193676, June 20,
2012, Sereno, J.; Bar Reviewer Labor and Social Legislation, Caingat Jr., 2020, pp
37)

2016 BAR QUESTION: Zienna Corporation (Zienna) informed the Department

of Labor and Employment Regional Director of the end of its operations. To carry
out the cessation, Zienna sent a Letter Request for Intervention to the NLRC for
permission and guidance in effecting payment of separation benefits for its fifty
(50) terminated employees. Each of the terminated employees executed a
Quitclaim and Release before Labor Arbiter Nocomora, to whom the case was
assigned. After the erstwhile employees received their separation pay, the Labor
Arbiter declared the labor dispute dismissed with prejudice on the ground of
settlement. Thereafter, Zienna sold all of its assets to Zandra Company (Zandra),
which in tum hired its own employees. Nelle, one of the fifty (50) terminated
employees, filed a case for illegal dismissal against Zienna. She argued that
Zienna did not cease from operating since the corporation subsists as Zandra.
Nelle pointed out that aside from the two companies having essentially the same
equipment, the managers and owners of Zandra and Zienna are likewise one and
the same. For its part, Zienna countered that Nelle is barred from filing a
complaint for illegal dismissal against the corporation in view of her prior
acceptance of separation pay. Is Nelle correct in claiming that she was illegally
dismissed? (5%)

SUGGESTED ANSWER:
No. The successor-employer doctrine involves a transfer of ownership of the
business to a new employer. Where the change of ownership is in bad faith or
is used to defeat the rights of labor, the successor-employer is deemed to have
absorbed the employees and is held liable for the transgressions of his/her
predecessor. (Philippine Air Lines vs. Catindoy, G.R. No. 125792, November 9,
1998. Panganiban, J.) In this case, the Nelle was not able to prove that the
acquisition of Zienna was in bad faith thus making Zandra a successor-
employer of Zienna.

2017 BAR QUESTION: Applying the tests to determine the existence of an

employer-employee relationship, is a jeepney driver operating under the
boundary system an employee of his jeepney operator or a mere lessee of the
jeepney? Explain your answer. (3%)

SUGGESTED ANSWER:

A jeepney driver operating under the boundary system is an employee of his

jeepney operator. The boundary system is a scheme by an owner/operator
engaged in transporting passengers as a common carrier to primarily govern
the compensation of the driver, that is, the latter’s daily earnings are remitted
to the owner/operator less the excess of the boundary which represents the
driver’s compensation. In the four-fold test, the control test assumes primary
consideration. Under the control test, there is an employer-employee
relationship when the person for whom the services are performed reserves
the right to control not only the end achieved but also the manner and means
used to achieve that end. In a boundary system, the directives given to the
drivers were such a means of control. (Villamaria v. CA, G.R. No. 165881, 19
April 2006)

2017 BAR QUESTION: Dr. Crisostomo entered into a retainer agreement with
AB Hotel and Resort whereby he would provide medical services to the guests
and employees of AB Hoteland Resort, which, in turn, would provide the clinic
premises and medical supplies. He received a monthly retainer fee of ₱60,000.00,
plus a 70% share in the service charges from AB Hotel and Resort's guests
availing themselves of the clinic's services. The clinic employed nurses and allied
staff, whose salaries, SSS contributions and other benefits he undertook to pay.
AB Hotel and Resort issued directives giving instructions to him on the
replenishment of emergency kits and forbidding the clinic staff from receiving
cash payments from the guests.
In time, the nurses and the clinic staff claimed entitlement to rights as regular
employees of AB Hotel and Resort, but the latter refused on the ground that Dr.
Crisostomo, who was their employer, was an independent contractor. Rule with
reasons. (4%)

SUGGESTED ANSWER:

I would rule in favor of AB Hotel and Resort. AB Hotel and Resort is correct in
stating that Dr. Crisostomo is an independent contractor since he carries an
independent business and undertakes the contract work on his account, his
own responsibility, according to his own manner and method, free from the
control and direction of his employer or principal in all matters connected to
the performance of his work except as to the results and that has substantial
capital or investment in the form of tools, equipment, machineries, work
premises and other materials necessary to conduct his business. (Franklin
Baguio ET. AL. v. NLRC, General Milling Corporation and/or Feliciano Lupo,
G.R. No. 79004-08, October 4, 1991)

Also, applying the four-fold test, it is patently clear that Dr. Crisostomo is their
employer, not AB Hotel and Resort. Dr. Crisostomo undertook to pay their
wages and other benefits and personally has exercised his control over his
employees over the means and methods inside their clinic.

2017 BAR QUESTION: Marcel was the Vice President for Finance and
Administration and a member of the Board of Directors of Mercedes
Corporation. He brought a complaint for illegal suspension and illegal dismissal
against Mercedes Corporation, which moved to dismiss the complaint on the
ground that the complaint pertained to the jurisdiction of the RTC due to the
controversy being intra-corporate based on his positions in the corporation.
Marcel countered that he had only been removed as Vice President for Finance
and Administration, not as a member of the Board of Directors. He also argued
that his position was not listed as among the corporate offices in Mercedes
Corporation's by-laws. Is the argument of Marcel correct? Explain your answer.
(2.5%)

SUGGESTED ANSWER:

Marcel is correct. He is not considered a corporate officer since his position is

not listed among the enumeration provided in the Corporation Code and the
Mercedes Coroporation’s by-laws. Thus, respondent was an employee, not a
"corporate officer." (Matling Industrial And Commercial Corporation et. al., v.
Ricardo R. Coros, G.R. No. 157802, October 13, 2010)

2017 BAR QUESTION: A, B, and C were hired as resident-doctors by MM

Medical Center, Inc. In the course of their engagement, A, B, and C maintained
specific work schedules as determined by the Medical Director. The hospital also
monitored their work through supervisors who gave them specific instructions
on how they should perform their respective tasks, including diagnosis,
treatment, and management of their patients. One day A, B, and C approached
the Medical Director and inquired about the non-payment of their employment
benefits. In response, the Medical Director told them that they are not entitled to
any because they are mere "independent contractors" as expressly stipulated in
the contracts, which they admittedly signed. As such, no employer-employee
relationship exists between them and the hospital.

a. What is the control test in determining the existence of an employer-

employee? (2%)
b. Is the Medical Director’s reliance on the contracts signed by A, B, and
C to refute the existence of an employer-employee relationship correct?
If not, are A, B, and C employees of MM Medical Center, Inc.? explain.
(3%)

SUGGESTED ANSWERS:

a. The control test is commonly regarded as the most crucial and

determinative indicator of the presence or absence of an employer-
employer relationship. Under this test, an employer-employee
relationship exists where the person from whom the services are
performed reserves the right to control not only the end achieved, but
also the manner and means used to achieve that end. (Section 3, Rule I-
A, Department Order No. 147-15, Series of 2015)

b. No. The Medical Director’s reliance on the contract is not correct. Under
the law, the employees’ conduct is the most crucial and determinative
indicator of the existence of the employer-employee relationship. MM
Medical Center’s power to control the doctors’ conduct is undeniable
since it closely monitored A, B, and C’s work through its supervisors
who gave them specific instructions on how they should perform their
respective tasks, including diagnosis, treatment, and management of
patients.
 In view of the existence of the power of control, A, B, and C are
considered employees if MM Medical Center, Inc. (Bar Reviewer Labor
and Social Legislation, Caingat, Jr., 2020, pp 41)

2019 BAR QUESTION Due to serious business reverses, ABC Co. decided to
terminate the services of several officers receiving “fat” compensation packages.
One of these officers was Mr. X, its Vice-President for External Affairs and a
member of the Board of Directors. Aggrieved, Mr. X filed a complaint for illegal
dismissal before the NLRC – Regional Arbitration Branch.
ABC Co. moved for the dismissal of the case on the ground of lack of jurisdiction,
asserting that since Mr. X occupied the position of Vice-President for External
Affairs which is listed in the by-laws of the corporation, the case should have
been tiled before the RTC.
The LA denied ABC Co.’s motion and proceeded to rule that Mr. X was illegally
dismissed. Hence, he was reinstated in ABC Co.’s payroll pending its appeal to
the NLRC.

a. Did the LA err in denying ABC Co.’s motion to dismiss on the ground of
lack of jurisdiction? Explain.

SUGGESTED ANSWER:
a. The LA erred in denying ABC Co.’s motion to dismiss on the
ground of lack of jurisdiction. Mr. X is considered a corporate
officer since his position is listed among the enumeration
provided in the ABC Co.’s by-laws. Thus, Mr. X is a corporate
officer, not an employee. (Matling Industrial And Commercial
Corporation et. al., v. Ricardo R. Coros, G.R. No. 157802, October
13, 2010)

(b) Assuming that jurisdiction is not at issue and that the NLRC reverses the
LA’s ruling of illegal dismissal with finality, may ABC Co. claim
reimbursement for the amounts it paid to Mr. X during the time that he
was on payroll reinstatement pending appeal? Explain.

SUGGESTED ANSWER:

No, ABC Co. can no longer claim reimbursement for the amounts it paid to Mr.
X in view of the reversal of the Labor Arbiter’s decision of the NLRC. The
social justice principles of labor law outweigh or render inapplicable the civil
law doctrine of unjust enrichment. Otherwise, the "refund doctrine" easily
demonstrates how a favorable decision by the Labor Arbiter could harm, more
than help, a dismissed employee. (Juanito A. Garcia and Alberto J. Dumago v.
Philippine Airlines, Inc., G. R. No. 164856, July 20, 2009)

KINDS OF EMPLOYEES

2017 BAR QUESTION: Section 255 (245) of the Labor Code recognizes three
categories of employees, namely: managerial, supervisory, and rank-and-file.

(a) Give the characteristics of each category of employees, and state whether the
employees in each category may organize and form unions. Explain your
answer. (5%)

SUGGESTED ANSWER:

1. Managerial employees are not eligible to join, assist or form any

labor organization.
2. Supervisory employees shall not be eligible for membership in the
collective bargaining unit of the rank-and-file employees but may
join, assist or form separate collective bargaining units and/or
legitimate labor organizations of their own.
3. The rank-and-file union and the supervisors’ union operating within
the same establishment may join the same federation or national
union. (Article 255 of the Labor Code)

(b) May confidential employees who assist managerial employees, and who act
in a confidential capacity or have access to confidential matters being handled by
persons exercising managerial functions in the field of labor relations form, or
assist, or join labor unions? Explain your answer. (2.5%)

SUGGESTED ANSWER:
No, confidential employees who assist managerial employees, and who act in a
confidential capacity or have access to confidential matters being handled by
persons exercising managerial functions in the field of labor relations cannot
form, or assist, or join labor unions. The rationale for their separate category
and disqualification to join any labor organization is similar to the inhibition
for managerial employees, because if allowed to be affiliated with a union, the
latter might not be assured of their loyalty in view of evident conflict of
interests and the union can also become company-denominated with the
presence of managerial employees in the union membership. Having access to
confidential information, confidential employees may also become the source
of undue advantage. Said employees may act as a spy or spies of either party to
a collective bargaining agreement. (San Miguel Foods, Inc., v. San Miguel
Corporation Supervisors and Exempt Union, G.R. No. 146206, August 1, 2001)

2019 BAR QUESTION: Define, explain or distinguish the following terms:

(a) Seasonal and project employees (2%)

SUGGESTED ANSWER:

Seasonal employment involves work or service that is seasonal in nature or

lasting for the duration of the season. They are also called “peak season”
employees. (Monchito Ampeloquio vs. Jaka Distribution, Inc. G.R. No. 196936,
July 2, 2014, 729 SCRA 95, Perez, J.) while a project employment requires a
project or undertaking that does not mention a specific date or duration. (E.
Guanzon Inc., vs. Fortunato Ando, Jr., G.R. No. 214183, February 20, 2017,
Peralta, J.)

2019 BAR QUESTION Ms. A is a volleyball coach with 5 years of experience in

her field. Before the start of the volleyball season of 2015, she was hired for the
sole purpose of overseeing the training and coaching of the University’s
volleyball team. During her hiring, the Vice-President for Sports expressed to Ms.
A the University’s expectation that she would bring the University a
championship at the end of the year.

In her first volleyball season, the University placed 9th out of the 10 participating
teams. Soon after the end of the season, the Vice-President for Sports informed
Ms. A that she was a mere probationary employee and hence, she need not come
back for the next season because of the poor performance of the team.
In any case, the Vice-President for Sports claimed that Ms. A was a fixed-term
employee whose contract had ended at the close of the year.
 a. Is Ms. A a probationary, fixed-term, or regular employee? Explain your
reasons as to why she is or she is not such kind of an employee for each of
the types of employment given.

SUGGESTED ANSWER:

Ms. A is a regular employee. She is specifically hired to oversee the training

and coaching of the University’s volleyball team. The Vice-President cannot
claim that she is neither a fixed nor a probationary employee, since there is
neither a fixed-term arrangement nor did the Vice President explicitly state
that she has been hired for the specific undertaking of winning the
championship. There is also no trial period from which such probationary
employment status can be reasonably inferred. Absent any of the above-
mentioned factors, she is considered a regular employee regardless of the
employer’s intent in hiring her. (Article 295 of the Labor Code)

b. Assuming that Ms. A was dismissed by the University for serious

misconduct but was never given a notice to explain, what is the
consequence of a procedurally infirm dismissal from service under our
Labor law and jurisprudence? Explain.

SUGGESTED ANSWER:
The consequence of a procedurally infirm dismissal does not render Ms. A’s
dismissal invalid. However, the Supreme Court requires the University to
indemnify her in the form of nominal damages for the violation of her
statutory rights. (Jenny M. Agabon & Virgilio C. Agabon, v. NLRC, Riviera
Home Improvements, Inc. and Vicente Angeles, G.R. No. 158693, November 17,
2004)

STIPULATION AGAINST MARRIAGE

2017 BAR QUESTION: One of Pacific Airline's policies was to hire only single
applicants as flight attendants, and considered as automatically resigned the
flight attendants at the moment they got married. Is the policy valid? Explain
your answer. (2.5%)

SUGGESTED ANSWER:

The policy is invalid. Well settled is the doctrine laid down in Article 134 of
the Labor Code prohibiting an employer to require as a condition of
employment or continuation of employment that a woman employee shall not
get married, or to stipulate expressly or tacitly that upon getting married, a
woman employee shall be deemed resigned or separated, or to actually
dismiss, discharge, discriminate or otherwise prejudice a woman employee
merely by reason of her marriage. (Article 134 of the Labor Code)

WAGES

2017 BAR QUESTION: Tarcisio was employed as operations manager and

received a monthly salary of ₱25,000.00 through his payroll account with DB
Bank. He obtained a loan from Roberto to purchase a car. Tarcisio failed to pay
Roberto when the loan fell due. Roberto sued to collect, and moved to garnish
Tarcisio's payroll account. The latter vigorously objected and argued that salaries
were exempt from garnishment. Is Tarcisio correct? Explain your answer. (3%)

SUGGESTED ANSWER:

Tarcisio is incorrect. Well settled is the doctrine that “wages” and “salary”
while synonymous, are distinct for purposes of Article 1308 of the New Civil
Code which states that “laborer’s wages shall not be subject to execution or
attachment except for debts incurred for food, shelter, clothing and medical
attendance.” Since Tarcisio is earning a “salary” and is not considered as a
“laborer”, his monthly salary can be the subject of garnishment. (Rosario A,
Gaa, v. Court of Appeals, G.R. No. L-44169 December 3, 1985; Equitable PCI v.
Sadac, G.R. No. 164772, June 8, 2006)

WAGE DISTORTION

2019 BAR QUESTION Upon a review of the wage rate and structure pertaining
to its regular rank and file employees, K Corporation found it necessary to
increase its hiring rates for employees belonging to the different job classification
levels to make their salary rates more competitive in the labor market.

After the implementation of the new hiring salary, Union X, the exclusive
bargaining agent of the rank and file employees, demanded a similar salary
adjustment for the old employees. It argued that the increase in hiring rates
resulted in wage distortion since it erased the wage gap between the new and old
employees. In other words, new employees would enjoy almost the same salary
rates as K Corporation’s old employees.

a. What is wage distortion?

SUGGESTED ANSWER:

A wage distortion mean a situation where an increase in prescribed wage rates

results in the elimination or severe contraction of intentional quantitative
differences in wage or salary rates between and among employee groups in an
establishment as to effectively obliterate the distinctions embodied in such
wage structure based on skills, length of service, or other logical bases of
differentiation. (Article 124 of the Labor Code, Section 3 of R.A. 6727)

b. Did a wage distortion not arise under the circumstances which legally
obligated K Corporation to rectify the wages of its old employees?
Explain.

SUGGESTED ANSWER:

No, a wage distortion did not arise under the circumstances. Article 124 of the
Labor Code is clear in stating that only the application of any prescribed wage
increase by virtue of a law or wage order issued by any Regional Board results
in distortions of the wage structure within an establishment, the employer and
the union shall negotiate to correct the distortions. Since no prescribed wage
increase by virtue of law or a wage order occur, then no wage distortion exists
in this case. (Article 124 of the Labor Code)

EMPLOYEE BENEFITS

2014 BAR QUESTION: Lito was anticipating the bonus he would receive for
2013. Aside from the 13th month pay, the company has been awarding him and
his other co-employees a two to three months bonus for the last ten (10) years.
However, because of poor over-all sales performance for the year, the company
unilaterally decided to pay only a one month bonus in 2013. (4%)

Is Lito’s employer legally allowed to reduce the bonus?

SUGGESTED ANSWER:

Yes. A bonus is an act of generosity granted by an enlightened employer to

spur the employee to greater efforts for the success of the business and
realization of bigger profits. The granting of a bonus is a management
prerogative, something given in addition to what is ordinarily received by or
strictly due the recipient. Thus, a bonus is not a demandable and enforceable
obligation, except when it is made part of the wage, salary or compensation of
the employee. It may, therefore, be withdrawn, unless they have been made a
part of the wage or salary or compensation of the employees, a matter which is
not in the facts of the case (American Wire and Cable Daily Rated Employees
Union v. American Wire and Cable Co., Inc., G.R. No. 155059, April 29, 2005).

ALTERNATIVE ANSWER:

No. Having been enjoyed for the last ten (10) years, the granting of the bonus
has ripened into a company practice or policy which can no longer be
peremptorily withdrawn. Art. 100 of the Labor Code prohibits the diminution
or elimination by the employer of the employees’ existing benefits.

2014 BAR QUESTION: Luisito has been working with Lima Land for twenty
vears. Wanting to work in the public sector, Luisito applied with and was offered
a job at Livecor. Before accepting the offer, he wanted to consult you whether the
payments that he and Lima Land had made to the Social Security System (SSS)
can be transferred or credited to the Government Service Insurance System
(GSIS).

What would you advice? (4%)

SUGGESTED ANSWER:

Yes. Under R.A. 7699, otherwise known as the Portability Law, one may
combine his years of service in the private sector represented by his
contributions to the Social Security System (SSS) with his government service
and contributions to the GSIS. The contributions shall be totalized for
purposes of old-age, disability, survivorship and other benefits in case the
covered member does not qualify for such benefits in either or both Systems
without totalization.

2016 BAR QUESTION: Baldo, a farm worker on pakyaw  basis, had been working
on Dencio's land by harvesting abaca and coconut, processing copra, and
clearing weeds from year to year starting January 1993 up to his death in 2007.
He worked continuously in the sense that it was done for more than one
harvesting season.

[a] Was Dencio required to report Baldo for compulsory social security coverage
under the SSS law? Explain. (2.5%)

SUGGESTED ANSWER:
Dencio is required to report Baldo for compulsory social
security coverage under the SSS Law. From the facts mentioned, Baldo is
clearly an employee of Dencio. Considering the length of time that Baldo has
worked with Dencio, it may be justifiably concluded that he is engaged to
perform activities necessary or desirable in the usual trade or business of
Dencio and is therefore a regular employee. Length of service was used by the
Supreme Court in the case to pronounce that the individual involved is a
regular employee. Baldo, is thus, not a casual or  temporary employee,
exempted from the coverage of the SSS Law. (Brotherhood Labor
Unity Movement of the Philippines vs. Zamora, 147 SCRA 49, No. L-
48645 January 7, 1987)

[b] What are the liabilities of the employer who fails to report his employee for
social security coverage? Explain. (2.5%)

SUGGESTED ANSWER:

The employer is subject to the following liabilities: It shall pay to the

SSS damages equivalent to the benefit which the employee would have
been entitled had his name been reported on time to the SSS, except that in
case of pension benefi ts, the employer shall be liable to pay the SSS
damages equivalent to fi ve years monthly pension; however, if the
contingency occurs within thirty (30) days from date of employment, the
employer shall be relieved of his liability for damages and shall pay the
corresponding unremitt ed contributions and penalties  thereon.

2018 BAR QUESTION: Nico is a medical representative engaged in the

promotion of pharmaceutical products and medical devices for
Northern Pharmaceuticals, Inc. He regularly visits physicians’ clinics to inform
them of the chemical composition and benefits of his employer’s products. At the
end of every day, he receives a basic wage of PhP700.00 plus a PhP150.00
“productivity allowance.” For purposes of computing Nico’s 13th
month pay, should the daily “productivity allowance” be included? (2.5%)

SUGGESTED ANSWER:
No. The second paragraph of Section 5(a) of the Revised Guidelines
Implementing the 13th Month Pay Law states that “employees who  are paid a
fixed or guaranteed wage plus commission are also entitled to the mandated
13th month pay, based on their total earnings during the calendar year, i.e., on
both their fixed or guaranteed wage and commission.”

However, the SC in Philippine  Duplicators,  Inc.  v. NLRC, 241 SCRA 380

(G.R. No. 110068 February 15, 1995), declared the aforesaid provision as null
and void with respect to those medical  representatives who do not obtain
productivity allowances by virtue of generated sales. Such allowances are in
the nature of profit-sharing bonuses  or  commissions that should be properly
excluded from the ambit of the term “basic salary” for purposes of computing
13th month pay due  to employees.

DIMINUTION OF BENEFITS

2014 BAR QUESTION: Lolong Law Firm (LLF), which employs around fifty (50)
lawyers and one hundred (100) regular staff, suffered losses for the first time in
its history. The management informed its employees that it could no longer
afford to provide them free lunch. Consequently, it announced that a nominal fee
would henceforth be charged. Was LLF justified in withdrawing this benefit
which it had unilaterally been providing to its employees? (1%)

(A) Yes, because it is suffering losses for the first time.

(B) Yes, because this is a management prerogative which is not due to any legal
or contractual obligation.

(C No, because this amounts to a diminution of benefits which is prohibited by

the Labor Code.

(D) No, because it is a fringe benefit that has already ripened into a demandable
right.

SUGGESTED ANSWER:

(C) No, because this amounts to a diminution of benefits which is prohibited

by the Labor Code.
2019 BAR QUESTION: D, one of the sales representatives of OP, Inc., was
receiving a basic pay of ₱50,000.00 a month, plus a 1% overriding commission on
his actual sales transactions. In addition, beginning three (3) months ago, or in
August 2019, D was able to receive a monthly gas and transportation allowance
of ₱5,000.00 despite the lack of any company therefor. In November 2019, D
approached his manager and asked for his gas and transportation allowance for
the month. The manager declined his request, saying that the company had
decided to discontinue the aforementioned allowance considering the increased
costs of its overhead expenses. In response, D argued that OP, Inc.’s removal of
the gas and transportation allowance amounted to a violation of the rule on non-
diminution of benefits.

Is the argument of D tenable? Explain. (2.5%)

SUGGESTED ANSWER:

No, D’s argument is not tenable. The Principle of Non-Diminution of

Benefits [Art. 100, LC] strictly pertains to pre-promulgation benefits and not to
post-promulgation benefits such as subject allowance [Apex Mining Co. v.
NLRC, GR 86200, Feb 25, 1992; Insular Hotel Employees Union-NFL v.
Waterfront Insular Hotel Davao, GR 174040, Sept. 22, 2010]. If what is
diminished is s post-promulgation benefit, the rule violated is the Principle of
Grants. At any rate, the subject allowance has not yet ripened to a demandable
right since its enjoyment was for a few months only and the company did not
intend to grant it permanently.

MEAL BREAK

2017 BAR QUESTION: Percival was a mechanic of Pacific Airlines. He enjoyed a

meal break of one hour. However, during meal breaks, he was required to be on
stand-by for emergency work. During emergencies, he was made to forego his
meals or to hurry up eating. He demanded payment of overtime for work done
during his meal periods. Is Percival correct? Explain your answer. (3%)

SUGGESTED ANSWER:

Percival is correct. Well-settled is the rule that the eight hour period does not
include the meal break. However, in the case of Percival he was made to forego
his meals or to hurry up eating. Where during a meal period, the laborers are
required by their employers to stand by for emergency work, or where the
meal hour is not one of complete rest, such can be considered as overtime.
Therefore, Percival may claim overtime pay. (Pan-American World Airways
System, v. Pan-American Employees Association, G.R. No. L-16275, February
23, 1961)

FACILITIES

2018 BAR QUESTION: Nelda worked as a chambermaid in Hotel Neverland

with a basic wage of PhP560.00 for an eight-hour workday. On Good Friday, she
worked for one (1) hour from 10:00 PM to 11 :00 PM. Her employer paid her only
PhP480.00 for each 8-hour workday, and PhP70.00 for the work done on Good
Friday. She sued for underpayment of wages and non-payment of holiday pay
and night  shift  differential pay for working on a Good Friday. Hotel Neverland
denied   the alleged underpayment, arguing that based on long-standing
unwritten tradition, food and lodging costs  were partially shouldered by  the
employer  and partially paid for by the employee through salary deduction.
According to the employer, such valid deduction caused the payment of Nelda’s
wage to be below the prescribed minimum. The hotel  also  claimed  that she was
not entitled to holiday pay and night shift differential pay because hotel workers
have to work on holidays and may be assigned to work at night.

(A)      Does the hotel have valid legal grounds to deduct food and lodging costs
from Nelda’s basic salary? (2.5%)

SUGGESTED ANSWER:

In Mabeza v. NLRC, (271  SCRA  670  [1997]),  the  Supreme  Court established
three requirements before the value of “facilities” such as food and lodging
may be deducted from an employee’s wages: first, proof must be shown that 
such facilities are customarily furnished by the trade; second, the provision of
deductible facilities must be voluntarily accepted  in writing by the employee;
and finally, facilities must be charged at fair and reasonable value. In the case
at hand, the second and third requisites on voluntary acceptance of deductible
facilities in writing, at fair and reasonable  value, was not established.

(B) Applying labor standards law, how much should Nelda be paid for work
done on Good Friday? Show the computation in your test booklet and encircle
your final answer. (2.5%)
SUGGESTED ANSWER:

As an employee paid PhP 70 an hour, Nelda was entitled to an additional 100%

of her hourly wage for working on a Good Friday, plus 10% for night
differential pay. Nelda should be paid a total of PhP 154.00 for working that
day.

MATERNITY LEAVE

2016 BAR QUESTION Tess, a seamstress at Marikit Clothing Factory, became

pregnant. Because of morning sickness, she frequently absented herself from
work and often came to the factory only four (4) days a week. After two (2)
months, the personnel manager told her that her habitual absences rendered her
practically useless to the company and, thus, asked her to resign. She begged to
be retained, citing her pregnancy as reason for her absences. Tess asked for leave
of absence but her request was denied. She went on leave nevertheless. As a
result, she was thus dismissed for going on leave without permission of
management. Tess filed a complaint for illegal dismissal. The company's defense:
she was legally dismissed because of her numerous absences without leave and
not because of her pregnancy. On the other hand, Tess argues that her dismissal
was an act of discrimination, based as it was on her pregnancy which the
company treated as a disease. Whose position is meritorious-the company's or
Tess'? Explain. (5%)

SUGGESTED ANSWER:

The position of Tess is meritorious because the dismissal was based on

the alleged failure of Tess to file a leave of absence. She filed the said leave but
was denied by Mariit Clothing Factory. Under the present law, a pregnant
worker is entitled to go on a maternity leave. She asked for leave of absence
only to be denied and yet she was terminated for absence without leave. This
is an act that flagrantly violates Tess’ right which translates to discrimination.

DISABILITY BENEFITS

2018 BAR QUESTION: Nonato had been continuously employed and deployed
as a seaman who performed services that were necessary and desirable to the
business of N-  Train Shipping, through its local agent, Narita Maritime Services
(Agency), in accordance with the 2010 Philippine Overseas Employment
Administration Standard Employment Contract (2010 POEA-SEC). Nonato’s last
contract (for five months) expired on November 15, 2016. Nonato was then
repatriated due  to a “finished contract.” He immediately reported to the Agency 
and complained that he had been experiencing dizziness, weakness, and
difficulty in breathing. The Agency referred him to Dr. Neri, who examined,
treated, and prescribed him with medications. After a few months of treatment
and consultations, Nonato was declared fit to resume work as a seaman. Nonato
went back to the Agency to ask for re-deployment but the Agency rejected his
application. Nonato filed an illegal dismissal case against the Agency and its
principal, with a claim for total disability benefits based on the ailments that he
developed on board N- Train Shipping vessels. The claim was based on the
certification of his own physician, Dr. Nunez, that he was unfit for sea duties
because of his hypertension and diabetes.

Can Nonato successfully claim disability benefits against N-Train Shipping and
its agent Narita Maritime Services? (2.5%)

SUGGESTED ANSWER:

No. Nonato was repatriated due to a finished contract and not due to any
accident or illness he suffered while on board N- Train’s vessel. Moreover,
Nonato was declared fit-to-work by the company-designated physician. Under
the 2010 POEA- SEC, if a doctor appointed by the seafarer disagrees with the
assessment of the company-designated physician, a  third doctor may be
agreed upon jointly between the employer and the seafarer. The third doctor’s
decision shall be final and binding on both parties. In this case, no third doctor
was appointed. Thus, the fit-to-work assessment by the company- designated
physician stands.

COMPENSABLE ILLNESS

2017 BAR QUESTION: Rosa was granted vacation leave by her employer to
spend three weeks in Africa with her family. Prior to her departure, the General
Manager of the company requested her to visit the plant of a client of the
company in Zimbabwe in order to derive best manufacturing practices useful to
the company. She accepted the request because the errand would be important to
the company and Zimbabwe was anyway in her itinerary. It appears that she
contracted a serious disease during the trip. Upon her return, she filed a claim for
compensation, insisting that she had contracted the disease while serving the
interest of her employer.
Under the Labor Code, the sickness or death of an employee, to be compensable,
must have resulted from an illness either definitely accepted as an occupational
disease by the Employees' Compensation Commission, or caused by
employment subject to proof that the risk of contracting the same is increased by
working conditions.

Is the serious disease Rosa contracted during her trip to Africa compensable?
Explain your answer. (2.5%)

SUGGESTED ANSWER:

Yes, the serious disease of Rosa is compensable provided that she could
present a reasonable proof that her working condition increased his risk of
contracting the disease, or that there is a connection between his work and the
cause of the disease. For an occupational disease and the resulting disability or
death to be compensable, all of the following conditions must be satisfied:
(1) The employee’s work must involve the risks described herein;
(2) The disease was contracted as a result of the employee’s exposure to the
described risks;
(3) The disease was contracted within a period of exposure and under such
other factors necessary to contract it;
(4) There was no notorious negligence on the part of the employee.
If Rosa’s illness is not listed in the Rules on Employees' Compensation, said
claimant must positively prove that the risk of contracting the disease is
increased by the working conditions. Only a reasonable proof of work-
connection, not direct causal relation, however, is required to establish
compensability of a non-occupational disease. (Salalima v. Employees’
Compensation Commission, G.R. No. 146360, May 20, 2004)

HOLIDAY PAY

2019 BAR QUESTION: Ms. F, a sales assistant, is one of the eight (8) workers
regularly employed by ABC Convenience Store. She was required to report on
December 25 and 30. Should ABC Convenience Store pay her holiday pay?
Explain. (2.5%)

SUGGESTED ANSWERS:

No, ABC Convenience Store, being a retail establishment does not have the
duty to pay holiday pay to Ms. F because she is one of its less than 10 regular
employees. As such, she is disqualified by Art. 94(a), LC.
 WAGE ORDER

2017 BAR QUESTION: The Regional Tripartite Wages and Productivity Board
(RTWPB) for Region 3 issued a wage order on November 2, 2017 fixing the
minimum wages for all industries throughout Region 3.
(a) Is the wage order subject to the approval of the National Wages and
Productivity Commission before it takes effect? (2%)

SUGGESTED ANSWER:
No, the wage order is not subject to the approval of the National Wages and
Productivity Commission before it takes effect. the National Wages and
Productivity Commission function is to review the Wage Order issued by the
Regional Tripartite and Productivity Board. (Presidential Decree No. 442, as
amended by Section 3 of RA6727)

2017 BAR QUESTION: The law mandates that no petition for wage increase
shall be entertained within a period of 12 months from the effectivity of the wage
order. Under what circumstances may the Kilusang Walang Takot, a federation
of labor organizations that publicly and openly assails the wage order as
blatantly unjust, initiate the review of the wage increases under the wage order
without waiting for the end of the 12-month period? Explain your answer. (3%)
SUGGESTED ANSWER:
Kilusang Walang Takot may appeal such Wage Order to the National Wages
and Productivity Commission by filing a verified appeal with the Board not
later than ten (10) days from the date of publication of the Order on the
grounds of:

1. Non-conformity with prescribed guidelines and/or procedures;

2. Questions of law; and
3. Grave abuse of discretion amounting to lack or excess of
jurisdiction(Section 2 of NWPC Guidelines No. 001-95)

SERVICE INCENTIVE LEAVE

2019 BAR QUESTION: Mrs. B, the personal cook in the household of X, filed a
monetary claim against her employer, X, for denying her service incentive leave
pay. X argued that Mrs. B did not avail of any service incentive leave at the end
of her one (1) year of service and hence, not entitled to the said monetary claim.
(a) Is the contention of X tenable? Explain. (2.5%)
(b) Assuming that Mrs. B is instead a clerk in X’s company with at least 30
regular employees, will her monetary claim prosper? Explain (2.5%)

SUGGESTED ANSWERS:
a. No. The service incentive leave shall be commutable to its money
equivalent if not used or exhausted at the end of the year. (Section 5,
Rule V of the Omnibus Rule Implementing the Labor Code)
b. Yes. The following are not covered by service incentive leave :
1. Government employees, whether employed by the National
Government or any of its political subdivisions, including those
employed in government owned and/or controlled corporations with
original charters or created under special laws;
2. Persons in the personal service of another;
3. Managerial employees, if they meet all of the following conditions:
a. Their primary duty is to manage the establishment in which they
are employed or of a department or subdivision thereof;
b. They customarily and regularly direct the work of two or more
employees therein;
c. They have the authority to hire or fire other employees of lower
rank; or their suggestions and recommendations as to hiring,
firing, and promotion, or any other change of status of other
employees are given particular weight.
4. Officers or members of a managerial staff, if they perform the following
duties and responsibilities:
a. Primarily perform work directly related to management policies
of their employer;
b. Customarily and regularly exercise discretion and independent
judgment;
c. (I) Regularly and directly assist a proprietor or managerial
employee in the management of the establishment or subdivision
thereof in which he or she is employed; or (II) execute, under
general supervision, work along specialized or technical lines
requiring special training, experience, or knowledge; or (III)
execute, under general supervision, special assignments and
tasks; and
d. Do not devote more than twenty percent (20%) of their hours
worked in a workweek to activities which are not directly and
 closely related to the performance of the work described in
paragraphs paragraphs 4.a, 4.b, and 4.c, above;
5. Field personnel and those whose time and performance is unsupervised
by the employer;
6. Those already enjoying this benefit;
7. Those enjoying vacation leave with pay of at least five (5) days; and
8. Those employed in establishments regularly employing less than ten
(10) employees.
In this case, the company has 30 regular employees which more than 10
which is the maximum number of employees employed in an establishment
not covered by SIL.

FIXED-TERM EMPLOYEE

2014 BAR QUESTION: Lucy was one of approximately 500 call center agents at
Hambergis, Inc. She was hired as a contractual employee four years ago. Her
contracts would be for a duration of five (5) months at a time, usually after a one-
month interval Her re-hiring was contingent on her performance for the
immediately preceding contract. Six (6) months after the expiration of her last
contract, Lucy went to Hambergis personnel department to inquire why she was
not yet being recalled to work. She was told that her performance during her last
contract was “below average.” Lucy seeks your legal advice about her chances of
getting her job back. What will your advice be? (4%)

SUGGESTED ANSWER:

Lucy cannot get her job back. She is a fixed-term employee and as such, her
employment terminates upon the expiration of her contract (Rowell Industrial
Corporation v. Court of Appeals, G.R. No. 167714, March 7, 2007, 517 SCRA
691).

ALTERNATIVE ANSWER:

I will advise Lucy that she can get her job back if she files a case for illegal
dismissal where, as a general rule, the twin reliefs of backwages and
reinstatement are available. In the instant case, Lucy is a regular employee
because the employment contracts of five (5) months at a time, for four (4)
years are obviously intended to circumvent an employee’s security of tenure,
and are therefore void. As a regular employee, Lucy may only be dismissed
from service based on just and authorized causes enumerated under the Labor
Code, and after observance of procedural due process prescribed under said
law (Magsalin v. National Organization of Working Men, G.R. No. 148492,
May 9, 2003).

2014 BAR QUESTION: Lina has been working as a steward with a Miami,
U.S.A.-based Loyal Cruise Lines for the past fifteen (15) years. She was recruited
by a local manning agency, Macapagal Shipping, and was made to sign a ten-
month (10) employment contract everytime she left for Miami. Macapagal
Shipping paid for Lina’s round-trip travel expenses from Manila to Miami.
Because of a food poisoning incident which happened during her last cruise
assignment, Lina was not re-hired. Lina claims she has been illegally terminated
and seeks separation pay. If you were the Labor Arbiter handling the case, how
would you decide? (4%)

SUGGESTED ANSWER:

I will dismiss Lina’s complaint. Lina is a contractual employee and the length
of her employment is determined by the contracts she entered into. Here, her
employment was terminated at the the expiration of the contract (Millares v.
NLRC, G.R. No. 110524, July 29, 2002, 385 SCRA 306, 318).

2018 BAR QUESTION: Nathaniel has been a salesman assigned by Newmark

Enterprises (Newmark) for nearly two years at the Manila office of Nutrition
City, Inc. (Nutrition City). He was deployed pursuant to a service agreement
between Newmark and Nutrition City, the salient provisions of which were as
follows:

 the Contractor (Newmark) agrees to perform and provide the  Client

(Nutrition City), on a non-exclusive basis, such tasks or activities that are
considered contractible under existing laws, as may be needed by the
Client from time to time;

 the Contractor shall employ the necessary personnel like helpers,

salesmen, and drivers who are determined by the Contractor to be
efficiently trained;

 the Client may request replacement of the Contractor’s personnel if

quality of the desired result is not achieved;

 the Contractor’s personnel will comply with the Client’s policies, rules,
and regulations; and
  the Contractor’s two service vehicles and necessary equipment will be
utilized in carrying out the provisions of this Agreement.

When Newmark fired Nathaniel, he filed an illegal dismissal case against the
wealthier company, Nutrition City, Inc., alleging that he was a regular employee
of the same. Is Nathaniel correct? (2.5%)

SUGGESTED ANSWER:

Yes, Nathaniel is correct. Similar to the case of Coca-Cola Bottlers Philippines,

Inc. v. Agito, (G.R. No. 179546, February 13, 2009), the lack of control by the
Contractor (Newmark) over the worker Nathaniel can be gleaned from the
Service Agreement. It is apparent that Newmark has to comply with Nutrition
City’s regulations, and that Nutrition City has the right to request the
replacement of Newmark’s personnel. It is likewise apparent that the
Agreement did not identify the work needed to be performed and the final
result to be accomplished, pointing to the conclusion that Newmark did not
obligate itself to perform an identifiable job, work, or service. Nathaniel, thus,
was under the control of Nutrition City.

With respect to the service vehicles and equipment, these may not be
considered as substantial capital on the part of Newmark, as the facts do not
establish their sufficiency to carry out the Agreement. The presence of

Newmark’s vehicles and equipment did not necessarily preclude the use of
Nutrition City’s own capital and assets.

2018 BAR QUESTION: Nonato had been continuously employed and deployed
as a seaman who performed services that were necessary and desirable to the
business of N-  Train Shipping, through its local agent, Narita Maritime Services
(Agency), in accordance with the 2010 Philippine Overseas Employment
Administration Standard Employment Contract (2010 POEA-SEC). Nonato’s last
contract (for five months) expired on November 15, 2016. Nonato was then
repatriated due  to a “finished contract.” He immediately reported to the Agency 
and complained that he had been experiencing dizziness, weakness, and
difficulty in breathing. The Agency referred him to Dr. Neri, who examined,
treated, and prescribed him with medications. After a few months of treatment
and consultations, Nonato was declared fit to resume work as a seaman. Nonato
went back to the Agency to ask for re-deployment but the Agency rejected his
application. Nonato filed an illegal dismissal case against the Agency and its
principal, with a claim for total disability benefits based on the ailments that he
developed on board N- Train Shipping vessels. The claim was based on the
certification of his own physician, Dr. Nunez, that he was unfit for sea duties
because of his hypertension and diabetes.

(A) Was Nonato a regular employee of N-Train Shipping? (2.5%)

SUGGESTED ANSWER:

No. Seafarers are considered contractual  employees.  They  cannot be

considered as regular  employees under Article 280  of the Labor Code. Their
employment is governed by the contracts they sign every time they are hired
or rehired and their employment is terminated when the contract expires.
Their employment is contractually fixed for a certain period of time (Millares
v. NLRC, G.R. No. 110524, July 29, 2002).

CONTRACTOR AND SUBCONTRACTOR

2014 BAR QUESTION: Linis Manpower, Inc. (LMI) had provided janitorial
services to the Philippine Overseas Employment Administration (POEA) since
March 2009. Its service contract was renewed every three months. However, in
the bidding held in June 2012, LMI was disqualified and excluded. In 2013, six
janitors of LMI formerly assigned at POEA filed a complaint for underpayment
of wages. Both LMI and POEA were impleaded as respondents. Should POEA, a
government agency subject to budgetary appropriations from Congress, be held
liable solidarily with LMI for the payment of salary differentials due to the
complainant? Cite the legal basis of your answer. (4%)

SUGGESTED ANSWER:

Yes, but only to the extent of work performed under the contract. The second
paragraph of Art. 106 of the Labor Code provides:

Art. 106. Contractor or subcontractor. – … In the event that the contractor or

subcontractor fails to pay the wages of his employees in accordance with this
Code, the employer shall be jointly and severally, liable with his contractor or
subcontractor to such employees to the extent of the work performed under
the contract, in the same manner and extent that he is liable to employees
directly employed by him …
The fact that POEA is a government agency is of no moment. In U.S.A. v. Ruiz
(G.R. No. L-35645, May 22, 1985), the Supreme Court ruled that the State may
be sued if the contract it entered into is pursuant to its proprietary functions.

JOB CONTRACTING: LABOR ONLY CONTRACTING

2016 BAR QUESTION: Empire Brands (Empire) contracted the services of Style
Corporation (Style) for the marketing and promotion of its clothing line. Under
the contract, Style provided Empire with Trade Merchandising Representatives
(TMRs) whose services began on September 15, 2004 and ended on June 6, 2007,
when Empire terminated the promotions contract with Style. Empire then
entered into an agreement for manpower supply with Wave Human Resources
(Wave). Wave owns its condo office, owns equipment for the use by the TMRs,
and has assets amounting to Pl,000,000.00. Wave provided the supervisors who
supervised the TMRs, who, in tum, received orders from the Marketing Director
of Empire. In their agreement, the parties stipulated that Wave shall be liable for
the wages and salaries of its employees or workers, including benefits, and
protection due them, as well as remittance to the proper government entities of
all withholding taxes, Social Security Service, and Philhealth premiums, in
accordance with relevant laws. As the TMRs wanted to continue working at
Empire, they submitted job applications as TMRs with Wave. Consequently,
Wave hired them for a term of five (5) months, or from June 7, 2007 to November
6, 2007, specifically to promote Empire's products. When the TMRs' 5-month
contracts with Wave were about to expire, they sought renewal thereof, but were
refused. Their contracts with Wave were no longer renewed as Empire hired
another agency. This prompted them to file complaints for illegal dismissal,
regularization, non-payment of service incentive leave and 13th month pay
against Empire and Wave.

[a] Are the TMRs employees of Empire? (2.5%)

SUGGESTED ANSWER:
Yes from the moment Empire contracted the services of Style both engaged in
a Labor-Only Contract. The following elements are present: i) The contractor
or subcontractor does not have substantial capital or investment which relates
to the job, work or service to be performed and the employees recruited,
supplied or placed by such contractor or subcontractor are performing
activities which are directly related to the main business of the principal; or ii)
The contractor does not exercise the right to control over the performance of
the work of the contractual employee.
 [b] Were the TMRs illegally dismissed by Wave? (2.5%)

SUGGESTED ANSWER:
No. As the TMRs are employees of Empire, Wave did not have
the power of dismissal; thus, even if Wave dismissed the TMRs the same has
no consequence

2016 BAR QUESTION: Mario Brothers, plumbing works contractor, entered into
an agreement with Axis Business Corporation (Axis) for the plumbing works of
its building under construction. Mario Brothers engaged the services of Tristan,
Arthur, and Jojo as plumber, pipe fitter, and threader, respectively. These
workers have worked for Mario Brothers in numerous construction projects in
the past but because of their long relationship, they were never asked to sign
contracts for each project. No reports to government agencies were made
regarding their work in the company.
During the implementation of the works contract, Axis suffered financial
difficulties and was not able to pay Mario Brothers its past billings. As a result,
the three (3) employees were not paid their salaries for two (2) months and their
13th month pay. Because Axis cannot pay, Mario Brothers cancelled the contract
and laid off Tristan, Arthur, and Jojo. The 3 employees sued Mario Brothers and
Axis for illegal dismissal, unpaid wages, and benefits.

[a] Mario Brothers claims the 3 workers are project employees. It explains that
the agreement is, if the works contract is cancelled due to the fault of the client,
the period of employment is automatically terminated. Is the contractor correct?
Explain. (2.5%)

SUGGESTED ANSWER:

No, the contractor is not correct. A project employment arrangement exists

only when the project employees were assigned to carry out specific project or
undertaking. The duration and the scope of which is specified at the time the
employees were engaged for that project. The absence of a written contract
setting forth among others, the specific project its duration or the scope of the
work negates the existence of project employment. It is also required that the
employer must submit a termination report to the DOLE everytime a project is
completed. The fact that Tristan, Arthur and Jojo have been engaged by Mario
Brothers in the past for numerous projects without the latter submitting any
termination report to the DOLE is indicative that they are not project but
regular employees. (GMA Network vs. Carlos Pabriga, et. al., G.R. No. 176419,
November 27, 2013, 710 SCRA 690, Leonardo-De Castro, J. and DOLE
Department Order No. 19)

[b] Can Axis be made solidarily liable with Mario Brothers to pay the unpaid
wages and 13th month pay of Tristan, Arthur, and Jojo? Explain. (2.5%)

SUGGESTED ANSWER:

Yes. Axis shall be treated as the indirect employer which shall be jointly and
solidarily liable with Mario Brothers with respect to the money claims of
Tristan, Arthur and Jojo under the contract. (Article 106, Labor Code, as
amended; Bar Reviewer Labor and Social Legislation, Caingat Jr., 2020, pp 248)

2017 BAR QUESTION: The labor sector has been loudly agitating for the end of
labor-only contracting, as distinguished from job contracting. Explain these two
kinds of labor contracting, and give the effect of a finding that one is a labor-only
contractor. Explain your answers. (4%)

SUGGESTED ANSWER:

Job-contracting is allowed by law provided that the following conditions are

met:

1. The independent contractor carries an independent business and

undertakes the contract work on his account, his own responsibility,
according to his own manner and method, free from the control and
direction of his employer or principal in all matters connected to the
performance of his work except as to the results; and

2. The independent contractor has substantial capital or investment in the

form of tools, equipment, machineries, work premises and other
materials necessary to conduct his business. (Franklin Baguio ET. AL. v.
NLRC, General Milling Corporation and/or Feliciano Lupo, G.R. No.
79004-08, October 4, 1991)

On the other hand, labor-only contracting is prohibited by law and exists

when one or all of the aforementioned conditions are not sufficiently met.
(Article 106 of the Labor Code)
2019 BAR QUESTION: W Gas Corp. is engaged in the manufacture and
distribution to the general public of various petroleum products. On January 1,
2010, W Gas Corp. entered into a Service Agreement with Q Manpower Co.,
whereby the latter undertook to provide utility workers for the maintenance of
the former’s manufacturing plant. Although the workers were hired by q
Manpower Co., they used the equipment owed by W gas Corp. in performing
their tasks, and were likewise subject to constant checking based on W gas
Corp.’s procedures. On February 1, 2010, Mr. R, one of the utility workers, was
dismissed from employment in line with the termination of the Service
Agreement between W Gas Corp. and Q Manpower Co. Thus, Mr. R filed a
complaint for illegal dismissal against W Gas Corp., claiming that Q Manpower
Co. is only a labor-only contractor. In the course of the proceedings, W Gas Corp.
presented no evidence to prove Q manpower Co.’s capitalization.

(a) Is Q Manpower Co. a labor-only contractor? Explain. (2.5%)

(b)Will Mr. R’s complaint for illegal dismissal against W Gas Corp.
prosper? Explain. (2.5%)

SUGGESTED ANSWERS:
(a) Q Manpower Co., not being substantially capitalized and possessed with
investment in the form of tools, equipment, machineries or work premises, is a
labor-only contractor. Relevantly, its apparent labor-only contractor status is
confirmed by the fact that it does not control the means and methods of
performance of the manpower it supplied. Since both essential element and
confirming element are present, it is a labor-only contractor.

(b) Yes, it will prosper. In labor-only contracting, the legal personality of the
principal merges with that of its labor-only contractor who is just its agent.
[Coca-Cola Bottlers Phils., Inc. v. Dela Cruz, et al., GR 184977, Dec. 7, 2009]
Hence, pursuant to the Principle of Merger of Legal Personalities, the former
as the real employer can be proceeded against for illegal dismissal despite the
termination of subject contracting agreement.

INDEPENDENT CONTRACTOR

2014 BAR QUESTION: Luningning Foods engaged the services of Lamitan

Manpower, Inc., a bona fide independent contractor, to provide “tasters” that
will check on food quality. Subsequently, these “tasters” joined the union of
rank-and-file employees of Luningning and demanded that they be made regular
employees of the latter as they are performing functions necessary and desirable
to operate the company’s business. Luningning rejected the demand for
regularization. On behalf of the “tasters,” the union then filed a notice of strike
with the Department of Labor and Employment (DOLE). In response,
Luningning sought a restraining order from the Regional Trial Court (RTC)
arguing that the DOLE does not have jurisdiction over the case since it does not
have an employer-employee relationship with the employees of an independent
contractor.

If you were the RTC judge, would you issue a restraining order against the
union? (4%)

SUGGESTED ANSWER:

Yes. There is no labor dispute in the instant case. Since Lamitan Manpower is
a bona fide independent contractor, there is no employee-employer
relationship between the Luningning and the tasters.

ALTERNATIVE ANSWER:

No. Art. 254 of the Labor Code is clear that 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 provided in

MIGRANT WORKERS

2017 BAR QUESTION: As a rule, direct hiring of migrant workers is not

allowed. What are the exceptions? Explain your answer. (2.5%)

SUGGESTED ANSWER:

Direct Hiring occurs when an employer hires a Filipino worker for overseas
employment without going through the Philippine Overseas Employment
Agency or other entities authorized by the Secretary of Labor. Direct hiring is
not allowed to ensure the best possible terms and conditions of employment
for the workers and employers, as well as to regulate the sector to avoid
Filipino exploitation overseas. Direct hiring can only occur by the following
exceptions:

1. International organizations
2. Name hires
 3. Members of diplomatic organizations
4. Other employers as may be allowed by the Department of Labor and
Employment (Article 18 of the Labor Code)

2017 BAR QUESTION: Andrew Manning Agency (AMA) recruited Feliciano for
employment by lnvictus Shipping, its foreign principal. Meantime, AMA and
lnvictus Shipping terminated their agency agreement. Upon his repatriation
following his premature termination, Feliciano claimed from AMA and lnvictus
Shipping the payment of his salaries and benefits for the unserved portion of the
contract. AMA denied liability on the ground that it no longer had an agency
agreement with lnvictus Shipping. Is AMA correct? Explain your answer. (3%)

SUGGESTED ANSWER:

AMA is incorrect. The private employment agency (AMA) and the principal or
foreign-based employer (Invictus Shipping) are jointly and solidarily liable
for any violation of the recruitment agreement and the contracts of
employment. It is imposed by law to assure the aggrieved worker of
immediate and sufficient payment of what is due to him. (Section 10 of the
Migrant Workers Act RA 10022)

2017 BAR QUESTION: Phil, a resident alien, sought employment in the

Philippines. The employer, noticing that Phil was a foreigner, demanded that he
first secures an employment permit from the DOLE. Is the employer correct?
Explain your answer. (2.5%)

SUGGESTED ANSWER:

The employer is incorrect. In general, all non-resident foreign nationals who

intend to engage in gainful employment in the Philippines are required to
obtain an employment permit from the DOLE. In this case however, Phil is a
resident alien and is thus not under the ambit of Article 40 of the Labor Code.
Also, his case falls into the exception laid down in DOLE Department Order
75-06, Series of 2006 exempting resident aliens from obtaining an employment
permit as a prerequisite for employment in the Philippines. (Article 40 of the
Labor Code; D.O. 75-06, Series of 2006)

2017 BAR QUESTION: Marciano was hired as Chief Engineer on board the
vessel MN Australia. His contract of employment was for nine months. After
nine months, he was re-hired. He was hired a third time after another nine
months. He now claims entitlement to the benefits of a regular employee based
on his having performed tasks usually necessary and desirable to the employer's
business for a continuous period of more than one year. Is Marciano's claim
tenable? Explain your answer. (3%)

SUGGESTED ANSWER:

Marciano’s claim is untenable. As a seafarer, their employment is governed by

the contracts they sign everytime they are rehired and their employment is
terminated when the contract expires. Their employment is contractually fixed
for a certain period of time. They fall under the exception of Article 280 whose
employment has been fixed for a specific project or undertaking the
completion or termination of which has been determined at the time of
engagement of the employee or where the work or services to be performed is
seasonal in nature and the employment is for the duration of the season. While
there are certain forms of employment which also require the performance of
usual and desirable functions and which exceed one year but do not
necessarily attain regular employment status under Article 280. Overseas
workers including seafarers fall under this type of employment which are
governed by the mutual agreements of the parties. (Douglas Millares and
Rogelio Lagda, v. National Labor Relations Commission, Trans-Global
Maritime Agency, Inc. and Esso International Shipping Co., Ltd., G.R. No.
110524, July 29, 2002)

2019 BAR QUESTION Mr. A signed a 1-year contract with XYZ Recruitment Co.
for deployment as wielding supervisor for DEF, Inc. located in Dubai. The
employment contract, which the POEA approved, stipulated a salary of USD
600.00 a month. Mr. A had only been in his job in Dubai for 6 months when DEF,
Inc. announced that it was suffering from severe financial losses and thus
intended to retrench some of its workers, among them Mr. A. DEF, Inc. hinted,
however, that employees who would accept a lower salary could be retained.
Together with some other Filipino workers, Mr. A agreed to a reduced salary of
USD 400.00 a month and thus, continued with his employment.

a. Was the reduction of Mr. A’s salary valid? Explain.

SUGGESTED ANSWER:

No, the reduction is not valid. The reduction of Mr. A’s salary constitutes an
alteration or substitution of the employment contract to the prejudice of Mr. A.
Section 6 (i) of the Migrant Workers Act clearly prohibits the act of
substituting or altering to the prejudice of the worker, employment contracts
approved and verified by the Department of Labor and Employment from the
time of actual signing thereof by the parties up to and including the period of
the expiration of the same without the approval of the Department of Labor
and Employment. (Section 6 (i) of the Migrant Workers Act RA10022)

b. Assuming that the reduction was invalid, may Mr. A hold XYZ
Recruitment Co. liable for underpayment of wages? Explain.

SUGGESTED ANSWER:

Yes, Mr. A may hold XYZ Recruitment Co. liable for the payment of his wages
under the rule that a recruiter is solidarily liable for breaches of the terms and
conditions of the POEA-approved employment contract. The private
employment agency (XYZ Recruitment Co.) and the principal or foreign-based
employer (DEF Inc.) are jointly and solidarily liable for any violation of the
recruitment agreement and the contracts of employment. It is imposed by law
to assure the aggrieved worker of immediate and sufficient payment of what is
due to him. (Section 10 of the Migrant Workers Act RA 10022)

2019 BAR QUESTION W Ship Management, Inc. hired Seafarer G as bosun in its
vessel under the terms of the 2010 POEA-Standard Employment Contract. On his
6th month on board, Seafarer G fell ill while working. In particular, he
complained of stomach pain, general weakness, and fresh blood in his stool.
When his illness persisted, he was medically repatriated on January 15, 2018. On
the same day, Seafarer G submitted himself to a post-employment medical
examination, wherein he was referred to further treatment. As of September 30,
2018, Seafarer G has yet to be issued any fit-to-work certification by the
company-designated physician, much less a final and definitive assessment of his
actual condition. Since Seafarer G still felt unwell, he sought an opinion from a
doctor of his choice who later issued an independent assessment stating that he
was totally and permanently disabled due to his illness sustained during work.

Seafarer G then proceeded to file a claim for total and permanent disability
compensation. The company asserts that the claim should be dismissed due to
prematurity since Seafarer G failed to first settle the matter through the third-
doctor conflict resolution procedure as provided under the 2010 POEA-SEC.

a. What is the third-doctor conflict resolution procedure under the 2010

POEA-SEC?

SUGGESTED ANSWER:
The third-doctor conflict resolution procedure under the 2010 POEA-SEC
refers to the requirement of both parties selecting a third-party unbiased
physician in the case of conflicting medical assessments. This third party
physician’s findings and medical diagnosis are considered final and binding to
all parties. (Section 20 (b) of 2010 POEA-SEC)

b. Will Seafarer G’s claim for total and permanent disability benefits prosper
despite his failure to first settle the matter through the third-doctor conflict
resolution procedure? Explain.

SUGGESTED ANSWER:

No, Seafarer G’s claim for total and permanent disability benefits will not
prosper. Since the disability shall be based solely on the disability gradings
provided under the the 2010 POEA-SEC, and shall not be measured or
determined by the number of days a seafarer is under treatment or the number
of days in which sickness allowance is paid, Seafarer G cannot claim that
presumption under the 120-day rule applies to him. The 2010 POEA-SEC also
further clearly states that failure of the seafarer to comply with the mandatory
reporting requirement shall result in his forfeiture of the right to claim his
benefits. (Section 20 (b) and 20(a) of 2010 POEA-SEC)

c. Assuming that Seafarer G failed to submit himself to a post-employment

medical examination within 3 working days from his return, what is the
consequence thereof to his claim? Explain.

SUGGESTED ANSWER:

Should Seafarer G fail to submit himself to a post-employment medical

examination within 3 working days from his return, it shall result in his
forfeiture of the right to claim his benefits. (Section 20 (a) of 2010 POEA-SEC)

HOUSEHELPER / KASAMBAHAY

2017 BAR QUESTION: Are there differences between a househelper and a

homeworker? Explain your answer. (4%)

SUGGESTED ANSWER:
Yes, there are differences between a househelper and a homeworker.
Househelpers or “Kasambahays” are ministers to the personal needs and
comfort of his employer in the latter’s home. They are considered within the
ambit of RA 10361 or the Batas Kasambahay Law. On the other hand, a
homeworker or “industrial homeworker” performs in or about his own home
any processing or fabrication of goods and materials, in whole or in part,
which have been furnished directly or indirectly, by an employer and sold
thereafter to the latter. Unlike househhelpers, they are covered by Section 2 of
D.O. No.5-92. (Article 139 and 151 of the Labor Code; RA 10361 or the Batas
Kasambahay Law; D.O. No. 05-92)

APPRENTICE AND LEARNERSHIP

2016 & 2017 BAR QUESTION: Differentiate learnership from apprenticeship

with respect to the period of training, type of work, salary and qualifications.

SUGGESTED ANSWER:

As to type of work, apprentices are hire in highly technical industries and only
in apprenticeable occupations as approved by the Secretary of Labor and
Employment, while learners are hired in semi-skilled and industrial
occupation which are not apprenticeable.

As to period of training, apprentices are hired for more than three(3)

months but not exceed six (6) month, while learners are hired for a period not
to exceed three (3) months.

As to salary, both apprentice and learners are entitled to 75% of the

minimum wage and full payment when employed in piece or incentive-rate
jobs during training. In apprenticeship, the participating enterprise may
deduct from its taxable income one-half of the value of the labor as training
expense, while in Learnership, the participating employer may not deduct the
value of its training costs from its taxable income.

As to qualifications, both learners and apprentices must at least be 15

years of age. (Caingat Jr., 2020, Bar Reviewer Labor and Social Legislation, pp
50)

LABOR ORGANIZATION; REQUISITES

2014 BAR QUESTION: Our Lady of Peace Catholic School Teachers and
Employees Labor Union (OLPCS-TELU) is a legitimate labor organization
composed of vice-principals, department heads, coordinators, teachers, and non-
teaching personnel of Our Lady of Peace Catholic School (OLPCS).

OLPCS-TELU subsequently filed a petition for certification election among the

teaching and non-teaching personnel of OLPCS before the Bureau of Labor
Relations (BLR) of the Department of Labor and Employment (DOLE). The Med-
Arbiter subsequently granted the petition and ordered the conduct of a joint
certification election for the teaching and non-teaching personnel of OLPCS.

May OLPCS-TELU be considered a legitimate labor organization? (5%)

SUGGESTED ANSWER:

Yes. The facts of the case concede that OLPCS-TELY “is a legitimate labor
organization.”

MODES OF DETERMINING EXCLUSIVE BARGAINING AGREEMENT

2017 BAR QUESTION: The modes of determining the exclusive bargaining

agent of the employees in a business are: (a) voluntary recognition; (b)
certification election; and (c) consent election. Explain how they differ from one
another. (4%)

SUGGESTED ANSWER:

Voluntary Recognition is the process by which a legitimate labor union

is recognized by the employer as the exclusive bargaining
representative or agent in a bargaining unit. It is only proper if there is
only one legitimate labor organization existing and operating in a
bargaining unit.

On the other hand, Certification Election refers to 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. Contrary to a Consent Election, a
Certification Election is ordered by the Department of Labor.

Lastly, a Consent Election is an election voluntarily agreed upon by the

parties, with or without the intervention by the Department of Labor.
Unlike the Certification Election, a Consent Election is used to
 determine the administrator of the CBA when the contracting union
suffered massive disaffiliation. (Section 1 (h) of D.O. 40-03, Series of
2003)

COLLECTIVE BARGAINING AGREEMENT

2019 BAR QUESTION On December 1, 2018, GHI Co., an organized

establishment, and Union J, the exclusive bargaining agent therein executed a 5-
year CBA which, after ratification, was registered with the Bureau of Labor
Relations.
a. When can the union ask, at the earliest, for the renegotiation of all terms of
the CBA, except its representation aspect? Explain.

SUGGESTED ANSWER:

The union may ask, at the earliest, for the renegotiation of all terms of
the CBA, except its representation aspect not later than three (3) years
after its execution. (Article 264 of the Labor Code)

b. When is the earliest time that another union can file for a petition for
certification election? Explain.

SUGGESTED ANSWER:

The earliest time that another union can file for a petition for
certification election is during the freedom period of the CBA which last
for the 60 day period before the expiration of the CBA. (Article 268 of
the Labor Code)

CERTIFICATION ELECTION

2014 BAR QUESTION: Liwayway Glass had 600 rank-and-file employees. Three
rival unions A, B, and C participated in the certification elections ordered by the
Med-Arbiter. 500 employees voted. The unions obtained the following votes: A-
200; B-150; C-50; 90 employees voted “no union”; and 10 were segregated votes.
Out of the segregated votes, four (4) were cast by probationary employees and
six (6) were cast by dismissed employees whose respective cases are still on
appeal. (10%)
(A) Should the votes of the probationary and dismissed

employees be counted in the total votes cast for the purpose of determining the
winning labor union?

SUGGESTED ANSWER:

Yes. Rule IX, Sec. 5 of DOLE Department Order 40-03 provides that “[a]ll
employees who are members of the appropriate bargaining unit sought to be
represented by the petitioner at the time of the issuance of the order granting
the conduct of a certification election shall be eligible to vote. An employee
who has been dismissed from work but has contested the legality of the
dismissal in a forum of appropriate jurisdiction at the time of the issuance of
the order for the conduct of a certification election shall be considered a
qualified voter, unless his/ her dismissal was declared valid in a final
judgment at the time of the conduct of the certification election.”

(B) Was there a valid election?

SUGGESTED ANSWER:

Yes. To have a valid election, at least a majority of all eligible voters in the unit
must have cast their votes (Art. 256, now Art. 266, of the Labor Code). In the
instant case, 500 out of 600 rank-and-file employees voted.

C) Should Union A be declared the winner?

SUGGESTED ANSWER:

No. The Labor Code provides that the Labor Union receiving the majority of
the valid votes cast shall be certified as the exclusive bargaining agent of all
the workers in the unit (Art. 256, now Art. 266, of the Labor Code). Here, the
number of valid votes cast is 490; thus, the winning union should receive at
least 246 votes. Union A only received 200 votes.

(D) Suppose the election is declared invalid, which of the

contending unions should represent the rank-and-file employees?

SUGGESTED ANSWER:

None of them should represent the rank-and-file employees (Art. 255, now Art.
265, of the Labor Code).
(E) Suppose that in the election, the unions obtained

the following votes: A-250; B-150; C-50; 40 voted “no union”; and 10 were
segregated votes. Should Union A be certified as the bargaining representative?

SUGGESTED ANSWER:

Yes. The Labor Code provides that the Labor Union receiving the majority of
the valid votes cast shall be certified as the exclusive bargaining agent of all
the workers in the unit (Art. 256, now Art. 266, of the Labor Code). Here, the
number of valid votes cast is 490. Thus, the winning union should receive at
least 246 votes; Union A received 250 votes.

2014 BAR QUESTION: Samahang East Gate Enterprises (SEGE) is a labor

organization composed of the rank-and-file employees of East Gate Enterprises
(EGE), the leading manufacturer of all types of gloves and aprons.

EGE was later requested by SEGE to bargain collectively for better terms and
conditions of employment of all the rank-and-file employees of EGE.
Consequently, EGE filed a petition for certification election before the Bureau of
Labor Relations (BLR).

During the proceedings, EGE insisted that it should participate in the

certification process. EGE reasoned that since it was the one who filed the
petition and considering that the employees concerned were its own rank-and-
file employees, it should be allowed to take an active part in the certification
process.

Is the contention of EGE proper? Explain. (5%)

SUGGESTED ANSWER:

No. Under Art. 258 (a) of the Labor Code, an employer is a mere bystander in
certification elections, whether the petition for certification election is filed by
said employer or a legitimate labor organization. The employer shall not be
considered a party thereto with a concomitant right to oppose a petition for
certification election.

2016 BAR QUESTION: Lazaro, an engineer, organized a union in Garantisado

Construction Corporation (Garantisado) which has 200 employees. He
immediately filed a Petition for Certification Election, attaching thereto the
signatures of 70 employees. Garantisado vehemently opposed the petition,
alleging that 25 signatories are probationary employees, while 5 are supervisors.
It submitted the contracts of the 25 probationary employees and the job
description of the supervisors. It argued that if 30 is deducted from 70, it gives a
balance of 40 valid signatures which is way below the minimum number of 50
signatories needed to meet the alleged 25% requirement. If you are the Director
of Labor Relations, will you approve the holding of a Certification Election.
Explain your answer. (5%)

SUGGESTED ANSWER:

Yes, I will allow the certification election. What is required for a certification
election is that at least 25 per cent of the bargaining unit must sign the
petition. Since 25 percent of 200 is 50 then the fact that there were   70
signatories who signed means that it should be allowed. Note that out of the70
signatories only the supervisors should be excluded. Article 254 of the Labor
Code allows supervisory employees to form, join, or assist separate labor
organizations but they are not eligible for membership in a Labor organization
of the rank-and-file. Thus, they are the only ones, that should be disqualified.
As to the probationary employees, they should be included. The fact that an
employee is given a classification such as beginner, trainee, or probationary
employee, and the fact that contemplation of permanent tenure is subject to
satisfactory completion of an initial trial period, are insufficient to warrant
such employees' exclusion from a bargaining unit. Moreover the eligibility of
probationary employees does not turn on the proportion of such employee
who, willingly or not, fails to continue to work for the employer throughout
the trial period."

2018 BAR QUESTION: Nayon Federation issued a charter certificate creating a

rank-and-file Neuman Employees Union. On the same day, New Neuman
Employees Union filed a petition for certification election with the Department of
Labor and Employment (DOLE) Regional Office, attaching the appropriate
charter certificate.

(A)   The employer, Neuman Corporation, filed a motion to dismiss the petition

for lack of legal personality on the part of the petitioner union. Should the
motion be granted? (2.5%)

SUGGESTED ANSWER:
No. The motion should be denied. Under Article 240 of the Labor Code (LC), a
petition for certification election may be filed on the basis of a valid charter
certificate issued to a chartered local by a duly registered federation.

(B) The employer likewise filed a petition for cancellation of union registration
against New Neuman Employees Union, alleging that Nayon Federation already
had a chartered local rank-and-file  union, Neuman Employees Union, pertaining
to the same bargaining unit within the establishment. Should the petition for
cancellation prosper? (2.5%)

SUGGESTED ANSWER:

No. The existence of another chartered local under the same federation within
the same bargaining unit is not among the grounds to cancel union registration
under Article 247 LC, as amended by RA 9481.

2018 BAR QUERSTION: A certification election was conducted in Nation

Manufacturing Corporation, whereby 55% of eligible voters in the bargaining
unit cast their votes. The results were as follows:

Union Nana: 45 votes Union Nada: 40 votes Union Nara: 30 votes No Union: 80
votes

Union Nana moved to be declared as the winner of the certification election.

(A) Can Union Nana be declared as the winner? (2.5%)

SUGGESTED ANSWER:

Union Nana cannot be immediately declared as the winner. A run-off election

pursuant to Article 268 of the Labor  Code (LC) must be first be conducted. A
run-off election is required since the present case involves an election which
provided for three or more choices, with no choice receiving a majority of the
valid votes cast, and the total number of votes for all contending unions being
at least 50% of the number of votes cast.

(B) Assume that the eligibility of 30 voters was challenged during the pre-
election conference. The ballots of the 30 challenged voters were placed inside an
envelope sealed by the DOLE Election Officer. Considering the said envelope
remains sealed,  what  should be the next course of action with respect to the said
challenged votes? (2.5%)

SUGGESTED ANSWER:

Challenged votes may materially affet the results of the election, and may in

fact even give Union Nada or Union Nara an absolute majority, then the said
challenged votes should be opened. Pursuant to Rule IX, Section 11 of the
Rules Implementing Book V of the Labor Code, the envelope with the
challenged votes shall be opened and the question of eligibility shall be
passed upon by the DOLE medarbiter.

STRIKE

2019 BAR QUESTION: Strikes and lockouts (2%)

SUGGESTED ANSWERS:

A strike refers to any temporary stoppage of work by the concerted action of

employees as a result of a labor or industrial dispute. (Section 1 [uu], Rule 1,
Department Order No. 40-03, series of 2003). A lockout refers to the temporary
refusal of an employer to furnish work as a result of a labor or industrial
dispute. (Section 1 [gg], Rule 1, Department Order No. 40-03, series of 2003).

2014 BAR QUESTION: As a result of a bargaining deadlock between Lazo

Corporation and Lazo Employees Union, the latter staged a strike. During the
strike, several employees committed illegal acts. Eventually, its members
informed the company of their intention to return to work. (6%)

(A) Can Lazo Corporation refuse to admit the strikers?

SUGGESTED ANSWER:

No. The commission of illegal acts during a strike does not automatically
bring about loss of employment status. Due process must be observed by the
employer before any dismissal can be made (Stamford Marketing Corp. v.
Julian, G.R. No. 145496, February 24, 2004, 423 SCRA 633).

(B) Assuming the company admits the strikers, can it later

on dismiss those employees who committed illegal acts?

SUGGESTED ANSWER:

No. The employer may be considered as having waived its right to dismiss
employees who committed illegal acts during the strike (Reformist Union of
R.B. Liner v. NLRC, G.R. No. 120482, January 27, 1997, 266 SCRA 713).

(C) If due to prolonged strike, Lazo Corporation hired replacements, can it refuse
to admit the replaced strikers?

No. Sec. 3, Art. XIII of the Constitution guarantees workers the right to strike
in accordance with law, and prolonged strike is not prohibited by law. With
Art. 212 (o) defining strike as “any temporary stoppage of work as a result of
an industrial or labor dispute, it is the prerogative of strikers to cut short or
prolong a strike. By striking, the employees have not abandoned their
employment. Rather, they have only ceased temporarily from rendering work.
The striking employees have not lost their right to go back to their positions,
because the declaration of a strike is not a renunciation of their employment,
much less their employee-employer relationship.

ALTERNATIVE ANSWER:

No. As a general rule, replacements take their employment as conditional, i.e.,

subject to the rights of strikers to return to work.

However, since this is an economic strike, the strikers are entitled to

reinstatement only in case Lazo Corporation has not yet hired permanent
replacements (Consolidated Labor Association v. Marsman & Co., G.R. No. L-
17038, July 31, 1964, 11 SCRA 589).

2014 BAR QUESTION: The procedural requirements of a valid strike include:

(1%)

(A) a claim of either unfair labor practice or deadlock in collective bargaining

(B) notice of strike filed at least fifteen (15) days before a ULP-grounded strike or
at least thirty (30) days prior to the deadlock in a bargaining-grounded strike
(C) majority of the union membership must have voted to stage the strike with
notice thereon furnished to the National Conciliation and Mediation Board
(NCMB) at least twenty-four (24) hours before the strike vote is taken

(D) strike vote results must be furnished to the NCMB at least seven (7) days
before the intended strike

SUGGESTED ANSWER:

(B) notice of strike filed at least fifteen (15) days before a ULP-grounded strike
or at least thirty (30) days prior to the deadlock in a bargaining-grounded
strike (Art. 263 (c), Labor Code).

ALTERNATIVE ANSWER:

(C).majority of the union membership must have voted to stage the strike with
notice thereon furnished to the National Conciliation and Mediation
Board(NCMB) at least 24 hours before the strike vote is taken (Art. 263 (f),
Labor Code).

(D) strike vote results must be furnished to the NCMB at least seven (7) days
before the intended strike (Art. 263 (f), Labor Code).

2014 BAR QUESTION: Liwanag Corporation is engaged in the power

generation business. A stalemate was reached during the collective bargaining
negotiations between its management and the union. After following all the
requisites provided by law, the union decided to stage a strike. The management
sought the assistance of the Secretary of Labor and Employment, who assumed
jurisdiction over the strike and issued a return-to-work order. The union defied
the latter and continued the strike. Without providing any notice, Liwanag
Corporation declared everyone who participated in the strike as having lost their
employment. (4%)

(A) Was Liwanag Corporation’s action valid?

SUGGESTED ANSWER:

Yes. A strike that is undertaken despite the issuance by the Secretary of Labor
of an assumption or certification order becomes an illegal act committed in the
course of a strike. It rendered the strike illegal. The Union officers and
members, as a result, are deemed to have lost their employment status for
having knowingly participated in an illegal act (Union of Filipro Employees
(UFE) v. Nestle Philippines, Inc., G.R. Nos. 88710-13, December 19, 1990, 192
SCRA 396). Such kind of dismissal under Art. 264 can immediately be resorted
to as an exercise of management prerogative (Biflex Phils., Inc. v. Filflex
Industrial & Manufacturing Corp., G.R. No. 155679, December 19, 2006, 511
SCRA 247).

ALTERNATIVE ANSWER:

No. Liwanag Corporation cannot outrightly declare the defiant strikers to have
lost their employment status. “(A)s in other termination cases,” the strikers are
entitled to due process protection under Art. 277 (b) of the Labor Code.
Nothing in Art. 264 of the Code authorizes immediate dismissal of those who
commit illegal acts during a strike (Stamford Marketing Corp. V. Julian, G.R.
No. 145496, February 24, 2004, 423 SCRA 633; Suico v. NLRC, G.R. No. 146762,
January 30, 2007, 513 SCRA 325).

(B) If, before the DOLE Secretary assumed jurisdiction, the striking union
members communicated in writing their desire to return to work, which offer
Liwanag Corporation refused to accept, what remedy, if any, does the union
have?

SUGGESTED ANSWER:

File a case for illegal dismissal [Art. 217 (a) (2), Labor Code]

2017 BAR QUESTION: Given that the liability for an illegal strike is individual,
not collective, state when the participating union officers and members may be
terminated from employment because of the illegal strike. Explain your answer.
(4%)

SUGGESTED ANSWER:

In the determination of the consequences of illegal strikes, the law makes a

distinction between union members and union officers. The services of an
ordinary union member cannot be terminated for mere participation in an
illegal strike; proof must be adduced showing that he or she committed illegal
acts during the strike. A union officer, on the other hand, may be dismissed,
not only when he actually commits an illegal act during a strike, but also if he
knowingly participates in an illegal strike. (Ergonomic Systems Piillippines,
Inc., Phillp C. Ng and Ma. Lourminda O. Ng v. Emerito C. Enaje et.al., G.R. No.
195163, December 13, 2017)

2017 BAR QUESTION: A sympathetic strike is stoppage of work to make

common cause with other strikers in another establishment or business. Is the
sympathetic strike valid? Explain your answer. (1%)

SUGGESTED ANSWER:

No, the sympathetic strike is invalid. Article 212 of the Labor Code defines
strike as any temporary stoppage of work by the concerted action of
employees as a result of an industrial or labor dispute. A valid strike therefore
presupposes the existence of a labor dispute. The strike undertaken by the
strikers took the form of a sit-down strike, or more aptly termed as a
sympathetic strike, where the striking employees have no demands or
grievances of their own, but they strike for the purpose of directly or indirectly
aiding others, without direct relation to the advancement of the interest of the
strikers. Therefore it is indubitable that a sympathetic strike is an illegal
strike. (G & S Transport Corporation, v. Tito S. Infante, Melor Velasco, Jr., JJ.
Borbo, And Danilo Castañeda,. G.R. No. 160303, September 13, 2007)

UNFAIR LABOR PRACTICE

2019 BAR QUESTION When resolving a case of unfair labor practice filed by a
union, what should the critical point of analysis to determine if an act constitutes
ULP?

SUGGESTED ANSWER:

Unfair labor practice refers to acts that violate the workers' right to organize.
There should be no dispute that all the prohibited acts constituting unfair
labor practice in essence relate to the workers' right to self-organization. Thus,
an employer may only be held liable for unfair labor practice if it can be
shown that his acts affect in whatever manner the right of his employees to
self-organize. Thus, the critical point of analysis to determine if an act
constitutes ULP is whether or not they are enumerated under the Labor Code.
(Rommel M. Zambrano et.al., v. Philippine Carpet Manufacturing Corp. G.R.
No. 224099. June 21, 2017)

GRIEVANCE MACHINERY
2019 BAR QUESTION: What is grievance machinery? (2%)

SUGGESTED ANSWER:

Grievance machinery is a committee created by the parties in a collective

bargaining agreement primarily for the adjustment and resolutions of
grievances arising from the interpretation of their collective bargaining
agreement and those arising from the interpretation or enforcement of
company personnel policies. (Article 273, Labor Code)

2018 BAR QUESTION: Natasha Shoe Company adopted an organizational

streamlining program that resulted in the retrenchment of 550 employees in its
main plant. After having been paid their separation benefits, the retrenched
workers demanded payment of retirement benefits under a CBA between their
union and management. Natasha Shoe Company denied the workers’ demand.

(a)  What is the most procedurally peaceful means to resolve this dispute? (2.5%)

SUGGESTED ANSWER:

The parties may resolve this through plant-level mechanisms such as a labor-
management committee or a grievance machinery under a collective
bargaining agreement

Can the workers claim both separation pay and retirement benefits? (2.5%)

SUGGESTED ANSWER:

(b) In Santos v. Senior Philippines, (G.R. No. 166377, November 28, 2008), the
Supreme Court held that retirement benefits and separation pay are not
mutually exclusive, and both benefits may be paid in the absence of a contrary
stipulation in the retirement plan and/or in the CBA.

QUITCLAIM

2016 BAR QUESTION: What are the requisites of a valid quitclaim? (5%)

SUGGESTED ANSWER:
Requisites of a valid quitclaim.
Cases abound where the Court gave effect to quitclaims executed by the
employees when the employer is able to prove the following requisites:
1. the employee executes a deed of quitclaim voluntarily;
2. there is no fraud or deceit on the part of any of the parties;
3. the consideration of the quitclaim is credible and reasonable; and
4. the contract is not contrary to law, public order, public policy, morals or
goods customs, or prejudicial to a third person with a right recognized
by law. (Luis Doble, Jr. vs. ABB, Inc., G.R. No. 215627, June 5, 2017,
Peralta, J.)

BUREAU OF LABOR RELATIONS

2019 BAR QUESTION: Bureau of Labor Relations

The Bureau of Labor Relations and the Labor Relations Divisions in the
regional offices of the Department of Labor, shall have original and exclusive
authority to act, at their own initiative or upon request of either or both
parties:
a. On all inter-union and intra-union conflicts, and
b. All disputes, grievances or problems arising from or affecting
labor-management relations in all workplaces, whether
agricultural or non-agricultural, except those arising from the
implementation or interpretation of collective bargaining
agreements which shall be the subject of grievance procedure
and/or voluntary arbitration. (Article 232 of the Labor Code)

The Bureau of Labor Relations also has:

(a) Administrative powers such as:

i. Regulation of labor unions

ii. Keeping the registry of labor unions
iii. Maintenance of a file of the CBA

(b) Visitorial powers (Article 289 of the Labor Code)

NATIONAL LABOR RELATIONS COMMISSION; PROCEEDINGS

2014 BAR QUESTION: Non-lawyers can appear before the Labor Arbiter if: (1%)

(A) they represent themselves

(B) they are properly authorized to represent their legitimate labor organization
or member thereof

(C) they are duly-accredited members of the legal aid office recognized by the
DOJ or IBP

(D) they appear in cases involving an amount of less than Php5,000

SUGGESTED ANSWER:

(A) they represent themselves (Art. 222, Labor Code: Rule III, Sec. 6, 2011
NLRC Rules of Procedure).

JURISDICTION OF THE NLRC

2014 BAR QUESTION: The jurisdiction of the National Labor Relations

Commission does not include: (1%)

(A) exclusive appellate jurisdiction over all cases decided

by the Labor Arbiter (B) exclusive appellate jurisdiction over all cases decided

by Regional Directors or hearing officers involving the recovery of wages and

other monetary claims and benefits arising from employer-employee relations
where the aggregate money claim of each does not exceed five

thousand pesos (P5,000) (C) original jurisdiction to act as a compulsory

arbitration

body over labor disputes certified to it by the Regional

Directors (D) power to issue a labor injunction

SUGGESTED ANSWER:

(B) original jurisdiction to act as a compulsory arbitration body over labor

disputes certified to it by the Regional Directors (Art. 129, Labor Code).
2016 BAR QUESTION: Asia Union (Union) is the certified bargaining agent of
the rank-and-file employees of Asia Pacific Hotel (Hotel). The Union submitted
its Collective Bargaining Agreement (CBA) negotiation proposals to the Hotel.
Due to the bargaining deadlock, the Union, on December 20, 2014, filed a Notice
of Strike with the National Conciliation and Mediation Board (NCMB).
Consequently, the Union conducted a Strike Vote on January 14, 2015, when it
was approved. The next day, waiters who are members of the Union came out of
the Union office sporting closely cropped hair or cleanly shaven heads. The next
day, all the male Union members came to work sporting the same hair style. The
Hotel . prevented these workers from entering the premises, claiming that they
violated the company rule on Grooming Standards. On January 16, 2015, the
Union subsequently staged a picket outside the Hotel premises and prevented
other workers from entering the Hotel. . The Union members blocked the ingress
and egress of customers and employees to the Hotel premises, which caused the
Hotel severe lack of manpower and forced the Hotel to temporarily cease
operations resulting to substantial losses. On January 20, 2015, the Hotel issued
notices to Union members, preventively suspending them and charging them
with the following offenses: (1) illegal picket; (2) violation of the company rule on
Grooming Standards; (3) illegal strike; and (4) commission of illegal acts during
the illegal strike. The Hotel later terminated the Union officials and members
who participated in the strike. The Union denied it engaged in an illegal strike
and countered that the Hotel committed an unfair labor practice (ULP) and a
breach of the freedom of speech.

a. Was the picketing legal? Was the mass action of the Union officials and
members an illegal strike? Explain. (2.5%)

SUGGESTED ANSWER:

Yes, the employee’s concerted action is considered action is considered

as an economic strike and violates the no-strike policy in the CBA.
The union officers and members concerted action to shave their heads
and cropped their hair not only violated the Hotels Grooming
Standards but also violated the union’s duty and responsibility to
bargain in good faith. Since the bargaining deadlock. Is being
conciliated by the NCMB, the union’s action to have their officers and
members heads shaved was manifestly calculated to antagonize and
embarrass the Hotel management and in doing so effectively disrupted
the corporations of the Hotel and violated their duty to bargain
collectively in good faith.
 The union’s violation of the Hotels Grooming Standards was clearly a
deliberate and concerted action to undermine the authority of and to
embarrass the Hotel and was, therefore, not a protected action. The
appearances of the Hotel employees directly reflect the character and
well-being of the Hotel, being a five-star hotel that provides service to
top-notch clients. Obviously, the Hotel does not need to advertise its
labor problems with its clients. (National Union of Workers in the Hotel
and Restaurant vs. Court of Appeals, G.R. No. 163942, November 11, 2008,
570 SCRA 598, Velasco, Jr.; Caingat Jr., 2020, Bar Reviewer Labor and
Social Legislation, 2020, pp 597-598)

b. Rule on the allegations of ULP and violation of freedom of speech.

Explain. (2.5%)

SUGGESTED ANSWER:

The allegations of ULP and violation of freedom of speech is untenable. In

National Union of Workers in the Hotel Restaurant and Allied Industries
(NUWHRAIN-APL-IUF) Dusit Hotel Nikko Chapter vs. Court of Appeals The
court is of the opinion that the act of the union was not merely an expression
of their grievance or displeasure but indeed a calibrated and calculated act
designed to inflict serious damage to the Hotels finances or its reputation.
(Caingat Jr., 2020, Bar Reviewer Labor and Social Legislation, 2020, pp 598)

2018 BAR QUESTION: Due to his employer’s dire financial situation, Nicanor
was  prevailed upon by his employer to voluntarily resign. In exchange, he
demanded payment of salary differentials, 13 th month pay, and financial
assistance, as promised by his employer. Management promised to pay him as
soon as it is able to pay off all retrenched rank-and-file employees. Five years
later, and  before  management was able to pay Nicanor the amount promised to 
him,  Nicanor died of a heart attack. His widow, Norie. filed a money claim
against the company before the National Labor Relations Commission (NLRC),
including interest on the amount of the unpaid claim. She also claimed 
additional  damages arguing that the supposed resignation letter was obtained
from her spouse through undue pressure and influence. The employer filed a
motion to dismiss on the ground that (A) the NLRC did not have jurisdiction
over money claims, and (8) the action has prescribed.
(A) Does the NLRC have jurisdiction to award money claims including interest
on the amount unpaid? (2.5%)

SUGGESTED ANSWER:

The NLRC has jurisdiction over money claims arising from an employer-
employee relationship where the amount claimed is  in excess of PhP 5,000,
including interest, regardless of whether or not there is a claim for
reinstatement. (Sec. 10, RA 8042, as amended by RA 10022.

(B) Assuming that the NLRC has jurisdiction, has the action prescribed?(2.5%)

SUGGESTED ANSWER:

In Accessories Specialists, Inc. v. Alabama,  (G.R. No. 168985,  July 23, 2008), the
Supreme Court held that the principle of promissory estoppel can apply as a
recognized exception to the three-year prescriptive period under Article 291
(now 306) of the Labor Code. Nicanor relied on the promise of  the  employer
that he would be paid as soon as the claims of retrenched employees were
paid. If not for this promise, there would have been no reason why Nicanor
would delay the filing of the complaint. Great injustice would be committed if
the employee’s claim were brushed aside on mere technicality, especially
when it was the employer’s action that prevented Nicanor from filing the
claims within the required period.

(C) May Nicanor’s spouse successfully claim additional damages as a result of

the alleged undue pressure and influence? (2.5%)

SUGGESTED ANSWER:

Norrie failed to establish that Nicanor’s consent was vitiated  when he filed his
resignation letter. In BMG  Record  v. Aparecio, (G.R. No. 153290, September 5,
2007), the SC ruled that the matter of “financial assistance” was an act of
generosity on the part of management. Under the circumstances, Nicanor had
the intention to resign. Once management had accepted the resignation,
Nicanor could not unilaterally withdraw this voluntary act of termination of
employment.

JURISDICTION OF THE VOLUNTARY ARBITRATOR

2017 BAR QUESTION: State the jurisdiction of the Voluntary Arbitrator, or

Panel of Voluntary Arbitrators in labor disputes? (4%)
ANSWER:

The Voluntary Arbiter or the Panel of Voluntary Arbiters’ jurisdiction in labor

disputes are the following:
1. Original and exclusive jurisdiction over cases involving:
a. Unresolved grievances arising from implementation or
interpretation of a CBA
b. Unresolved grievances arising from implementation or
interpretation of a company personnel policies (Article 274 of the
Labor Code)
2. Wage distortion issues (Section 7 of R.A. 6727)
3. Grievances arising from interpretation and implementation of
productivity incentive programs (Section 9 of R.A. 6971)
4. Violations of CBA provisions except those which are gross in character
(Article 275 of the Labor Code)
5. Any other labor disputes upon agreement of the parties (Article 275 of
the Labor Code)

2019 BAR QUESTION Briefly discuss the powers and responsibilities of the
following in the scheme of the Labor Code:

SUGGESTED ANSWER: The Voluntary Arbiter or the Panel of Voluntary

Arbiters’ jurisdiction in labor disputes are the following:
(a) Original and exclusive jurisdiction over cases involving:

i. Unresolved grievances arising from implementation or

interpretation of a CBA
ii. Unresolved grievances arising from implementation or
interpretation of a company personnel policies (Article 274
of the Labor Code)
(b) Wage distortion issues (Section 7 of R.A. 6727)
(c) Grievances arising from interpretation and implementation of
productivity incentive programs (Section 9 of R.A. 6971)
a. Violations of CBA provisions except those which are gross in
character (Article 275 of the Labor Code)
b. Any other labor disputes upon agreement of the parties (Article
275 of the Labor Code)

JURISDICTION OF THE LABOR ARBITER

2014 BAR QUESTION: Lincoln was in the business of trading broadcast
equipment used by television and radio networks. He employed Lionel as his
agent. Subsequently, Lincoln set up Liberty Communications to formally engage
in the same business. He requested Lionel to be one of the incorporators and
assigned to him 100 Liberty shares. Lionel was also given the title Assistant Vice-
President for Sales and Head of Technical Coordination. After several months,
there were allegations that Lionel was engaged in “under the table dealings” and
received “confidential commissions” from Liberty’s clients and suppliers. He
was, therefore, charged with serious misconduct and willful breach of trust, and
was given fortyeight (48) hours to present his explanation on the charges. Lionel
was unable to comply with the 48-hour deadline and was subsequently barred
from entering company premises. Lionel then filed a complaint with the Labor
Arbiter claiming constructive dismissal. Among others, the company sought the
dismissal of the complaint alleging that the case involved an intra-corporate
controversy which was within the jurisdiction of the Regional Trial Court (RTC).

If you were the Labor Arbiter assigned to the case, how would you rule on the
company’s motion to dismiss? (5%)

SUGGESTED ANSWER:

I will deny the motion to dismiss. “Corporate officers” in the context of

Presidential Decree No. 902-A are those officers of the corporation who are
given that character by the Corporation Code or by the corporation’s by-laws.
Sec. 25 of the Corporation Code enumerates three specific officers that in law
are considered as corporate officers – the president, secretary and the treasurer.
Lincoln is not one of them. There is likewise no showing that his position as
Assistant Vice-President is a corporate officer in the company’s by-laws. The
Labor Arbiter therefore, has jurisdiction over the case (Art. 217 (a) (2), Labor
Code).

LIBERAL INTERPRETATION

2017 BAR QUESTION: Procopio was dismissed from employment for stealing
his co-employee Raul's watch. Procopio filed a complaint for illegal dismissal.
The Labor Arbiter ruled in Procopio's favor on the ground that Raul's testimony
was doubtful, and, therefore, the doubt should be resolved in favor of Procopio.
On appeal, the NLRC reversed the ruling because Article 4 of the Labor Code -
which states that all doubts in the interpretation and implementation of the
provisions of the Labor Code, including the implementing rules and regulations,
shall be resolved in favor of labor - applied only when the doubt involved the
"implementation and interpretation" of the Labor Code; hence, the doubt, which
involved the application of the rules on evidence, not the Labor Code, could not
necessarily be resolved in favor of Procopio. Was the reversal correct? Explain
your answer. (3%)

SUGGESTED ANSWER:

No, the reversal is incorrect. Basic is principle laid down in Article 4 of the
Labor Code where it states that “all doubts in the implementation and
interpretation of the provisions of this Code, including its implementing rules
and regulations, shall be resolved in favor of labor”. In case doubts on the
credibility of the parties’ evidence should, by the law’s dictate, be settled in
favor of the working man. (Manolo A. Peñaflor, v. Outdoor Clothing
Manufacturing Corporation, G.R. No. 177114, April 13, 2010)

VISITORIAL AND ENFORCEMENT POWER OF THE DOLE

2016 BAR QUESTION: Inggo is a drama talent hired on a per drama

“participation basis” by DJN Radio Company. He worked from 8:00 a.m. until
5:00 p.m., six days a week, on a gross rate of P80.00 per script, earning an average
of P20,000.00 per month. Inggo filed a complaint before the Department of Labor
and Employment (DOLE) against DJN Radio for illegal deduction, non-payment
of service incentive leave, and 13th month pay, among others. On the basis of the
complaint, the DOLE conducted a plant level inspection. The DOLE Regional
Director issued an order ruling that Inggo is an employee of DJN Radio, and that
Inggo is entitled to his monetary claims in the total amount of P30,000.00. DJN
Radio elevated the case to the Secretary of Labor who affirmed the order. The
case was brought to the Court of Appeals. The radio station contended that there
is no employer-employee relationship because it was the drama directors and
producers who paid, supervised, and disciplined him. Moreover, it argued that
the case falls under the jurisdiction of the NLRC and not the DOLE because
Inggo’s claim exceeded P5,000.00.

a. May DOLE make a prima facie determination of the existence of an

employer-employee relationship in the exercise of its visitorial and
enforcement powers? (2.5%)

SUGGESTED ANSWER:
Yes. The DOLE, through its visitorial and enforcement powers, may determine
the prima facie existence of the employer-employee relationship for porpuses
of securing the employer’s compliance with the labor standards and other
labor legislation. In fact, the law does not limit DOLE’s’ power, and the
guidelines (control test) used by the court in determining the existence of the
relationship is also the same test used by the former (Caingat Jr., 2020, Bar
Reviewer Labor and Social Legislation, pp 302)

b. If the DOLE finds that there is an employee-employer relationship,

does the case fall under the jurisdiction of the Labor Arbiter
considering that the claim of inggo is more than P5,000.00. Explain.
(2.5%)

SUGGESTED ANSWER:

No. The case still falls under the jurisdiction of the DOLE. The expanded
power of the Secretary of Labor, or its duly authorized representative, under
R.A. 7730 has removed the Php5,000 limitation on the amount of money claims.
It allows the DOLE Secretary, or its duly authorized representative, to exercise.
Its visitorial and enforcement powers even of the amount of the claims exceeds
P5,000. (Bombo Radyo Phils., Inc. vs. The Secretary of the Department of Labor
and Employment, G.R. No. 179652, March 6, 2012, 667 SCRA 538, Velasco, Jr.;
Caingat Jr., 2020, Bar Reviewer Labor and Social Legislation, pp 302)

JURISDICTION OF THE SECRETARY OF LABOR

2019 BAR QUESTION Briefly discuss the powers and responsibilities of the
following in the scheme of the Labor Code:
SUGGESTED ANSWER:
(d) Secretary of Labor –

The Secretary of Labor shall have the following powers:

a. Enforcement powers
b. Visitorial powers (Articles 37, 128, and 165 of the Labor Code)
c. Appellate or power to review
d. Contempt powers (Article 231 of the Labor Code)
e. Assumption of jurisdiction (Article 278 (g) of the Labor Code)
f. Power to suspend the effects of termination of an employee
(Article 292 (b) of the Labor Code)
 ASSUMPTION OF JURISDICTION OF THE SECRETARY OF LABOR

2017 BAR QUESTION: Pursuant to his power under Sec. 278(g) (263(g)) of the
Labor Code, the Secretary of Labor assumed jurisdiction over the 3-day old strike
in Armor Steel Plates, Inc., one of the country's bigger manufacturers of steel
plates, and ordered all the striking employees to return to work. The striking
employees ignored the order to return to work.

(a) What conditions may justify the Secretary of Labor to assume jurisdiction?
(2.5%)

SUGGESTED ANSWER:

The Secretary of Labor is justified to assume jurisdiction 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. (Article
278 (g) of the Labor Code)

(b) What are the consequences of the assumption of jurisdiction by the

Secretary of Labor, and of the disobedience to the return to work? Explain
your answer. (2.5%)

SUGGESTED ANSWER:

The consequences of the assumption of jurisdiction by the Secretary of Labor

shall have the effect of automatically enjoining the intended or impending
strike or lockout as specified in the assumption or certification order. If 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. (Article 278 (g) of
the Labor Code)

If the workers disobeyed the return to work order, it shall have the same effect
of an illegal act committed in the course of the strike or lockout and shall
authorize the Secretary of Labor and Employment or the Commission, to
enforce the same under pain or loss of employment status or entitlement to
full employment benefits from the locking-out employer or backwages,
damages and/or other positive and/or affirmative reliefs, even to criminal
prosecution against the liable parties. The defiance of the union, its officers
and members of the Secretary of Labor’s assumption of jurisdiction thus
constitutes a valid ground for dismissal. (Article 278 (g) of the Labor Code;
Section 6, Rule IX, of the New Rules of Procedure of the NLRC; St. Scholastica's
College, v. Hon. Ruben Torres, In His Capacity As Secretary Of Labor And
Employment, And Samahang Ng Manggagawang Pang-Edukasyon Sa Sta.
Eskolastika-NAFTEU, G.R. No. 100158 June 2, 1992)

RESIGNATION VS. CONSTRUCTIVE DISMISSAL

2019 BAR QUESTION: Ms. T was caught in the act of stealing the company
property of her employer. When Ms. T admitted to the commission of the said
act to her manager, the latter advised her to just tender her resignation;
otherwise, she would face an investigation which would likely lead to the
termination of her employment and the filing of criminal charges in court. Acting
on her manager’s advice, Ms. T submitted a letter of resignation. Later on, Ms. T
filed a case for constructive dismissal against her employer. While Ms. T
conceded that her manager spoke to her in a calm and unforceful manner, she
claimed that her resignation was not completely voluntary because she was told
that should she not resign, she could be terminated from work for just cause and
worse criminal charges could be file against her.

(a) What is the difference between resignation and constructive dismissal?

(2%)
(b) Will Ms. T’s claim for constructive dismissal prosper? Explain. (3%)

SUGGESTED ANSWERS:

a. A resignation is voluntary self-termination when personal reasons

cannot be sacrificed in favor of the exigency of the employer’s business
[Gan v. Galderma Philippines, Inc., et al., GR 177167, Jan. 17, 2013]. In
contrast, a constructive dismissal is a quitting because the employer
makes continued employment impossible, unreasonable or unlikely
[Phil. Japan Active Carbon Corp. v. NLRC, GR 83239, March 8, 1989]

b. No, Ms. T’s claims will not prosper. She was not placed in a situation
that left her no option except to self-terminate. Instead, she was just
given a graceful exit. A graceful exit is within the prerogative of an
employer to give instead of binding an employee to his fault, or filing an
action for redress against him. [Central Azucarera de Bais, Inc., et al. v.
Janet T. Siason, GR 215555, July 29, 2015]
 TERMINATION : DUE PROCESS

2019 BAR QUESTION: Just and authorized causes (2%)

SUGGESTED ANSWER:

A dismissal based on just cause means that the employee has committed a

wrongful act or omission; while a dismissal based on authorized cause means
that there exists a ground which the law itself authorizes to be invoked to
justify the termination of an employee even if he has not committed any
wrongful act or omission.

2016 BAR QUESTION: Pedro, a bus driver of Biyahe sa Langit Transport, was
involved in a collision with a car, damaging the bus. The manager accused him
of being responsible for the damage and was told to submit his written
explanation within 48 hours. Pedro submitted his explanation within the period.
The day after, Pedro received a notice of termination stating that he is dismissed
for reckless driving resulting to damage to company property, effective
immediately. Pedro asks you, as his counsel, if the company complied with the
procedural due process with respect to dismissal of employees.
a. Explain the twin notice and hearing rule. (2.5%)

SUGGESTED ANSWER:

For termination of employment based on just causes as defined in Article 282

of the Code:
1. A written notice served on the employee specifying the ground or
grounds for termination, and giving to said employee reasonable
opportunity within which to explain his side;
2. A hearing or conference during which the employee concerned, with
the assistance of counsel if the employee so desires, is given
opportunity to respond to the charge, present his evidence or rebut the
evidence presented against him; and
3. A written notice of termination served on the employee indicating
that upon due consideration of all the circumstances, grounds have
been established to justify his termination.
In case of termination, the foregoing notices shall be served on the employee’s
last known address. (Salazar vs. Philippine Duplicators, Inc., 510 SCRA 288,
G.R. No. 154628 December 6, 2006; Caingat Jr., 2020, Bar Reviewer Labor and
Social Legislation, pp 778)

b. Did the Biyahe sa Langit Transport comply with the prior procedural
requirements for dismissal? (2.5%)

SUGGESTED ANSWER:

No. Biyahe sa Langit failed to comply with the procedural requirement

because Pedro was only given 48 hours within which to submit his written
explanation. The law requires a reasonable period of five days from receipt of
the notice in order to give Pedro an opportunity to study the accusation against
him, consult or be represented by a lawyer or union officer, gather data and
evidence, and decide on the defenses against the complaint. (Sec. 5 and 5.1,
Department Order NO. 147-15, series of 2015; Caingat Jr., 2020, Bar Reviewer
Labor and Social Legislation, pp 778)

2016 BAR QUESTION: Forbes Country Club (Club) owns a golf course and has
250 rank-and-file employees who are members of the Forbes Country Club
Union (Union). The Club has a CBA with the Union and one of the stipulations is
a Union Security Clause, which reads: "All regular rank-and-file employees who
are members of the union shall keep their membership in good standing as a
condition for their continued employment during the lifetime of this agreement."
Peter, Paul and Mary were the Treasurer, Assistant Treasurer, and Budget Officer
of the Union, respectively. They were expelled by the Board of Directors of the
Union for malversation. The Union then demanded that the Club dismiss said
officials pursuant to the Union Security Clause that required maintenance of
union membership. The Club required the three officials to show cause in writing
why they should not be dismissed. Later, the Club called the three Union officials
for a conference regarding the charges against them. After considering the
evidence submitted by the parties and their written explanations, the Club
dismissed the erring officials. The dismissed officials sued the Club and the
Union for illegal dismissal because there was really no malversation based on the
documents presented and their dismissal from the Union was due to the fact that
they were organizing another union.

a. Is the dismissal of Peter, Paul and Mary by the Club valid? (2.5%)

SUGGESTED ANSWER:
The dismissal of Peter, Paul and Mary is valid as it was made pursuant to
union security clause contained in the Collective Bargaining Agreement
between the management and the union. A union security clause is intended
to strengthen, a contracting union and protect it from the fickleness or perfidy
of its own members (Caltex Refinery Employees Association vs. Brillarts). In
terminating employees by reason of union security clause, what the employer
needs to determine and prove are: a) that the union security clause is
applicable, c) that there are sufficient evidence to support the decision of the
union to expel the employee from the union (Picop. Resources vs. Tantla). In
the case at bar, the union demanded – the dismissal of Peter, Paul and Mary
after they were expelled from the union. The club then afforded them due
process by ordering them to show cause in writing why they should not be
dismissed. Thereafter, a conference was held in their behalf. Having complied
with all the requirements mentioned, it can be said that the dismissal of Peter,
Paul and Mary was made validly.

b. If the expulsion by the Union was found by the Labor Arbiter to be

baseless, is the Club liable to Peter, Paul and Mary? Explain. (2.5%)

SUGGESTED ANSWER:

Yes. The club can be held liable to Peter, Paul and Mary. Even if the elements
under a and b as mentioned above are present, it behooves upon the club to
ascertain in good faith the sufficiency of evidence that supports the decision of
expelling them from the union. The club should have been circumspect in the
sense that it should have determined the veracity of the union’s claims that
Peter, Paul and Mary were indeed guilty of malversation. Should it have been
guilty of making a mistake then it should accountable for it. Just as the Court
has stricken down unjust exploitation of laborers by oppressive employers, so
will it strike down the unfair treatment by their own unworthy leaders. The
constitution enjoins the state to afford protection to labor. Fair dealing is
equally demanded of unions as well as of employers, in their dealing with
employees. (Heirs of Cruz vs. CIR) 

2019 BAR QUESTION: Bona fide occupational qualifications (2%)

SUGGESTED ANSWERS:
Employment in particular jobs may not be limited to persons of a particular sex,
religion, or national origin unless the employer can show that sex, religion, or
national origin is an actual qualification for performing the job. The qualification
is called a bona fide occupational qualification (BFOQ).”
 TERMINATION BY JUST CAUSES

2014 BAR QUESTION: Luisa was hired as a secretary by the Asian Development
Bank (ADB) in Manila. Luisa’s first boss was a Japanese national whom she got
along with. But after two years, the latter was replaced by an arrogant Indian
national who did not believe her work output was in accordance with
international standards. One day, Luisa submitted a draft report filled with
typographical errors to her boss. The latter scolded her, but Luisa verbally fought
back. The Indian boss decided to terminate her services right then and there.
Luisa filed a case for illegal dismissal with the Labor Arbiter claiming
arbitrariness and denial of due process.

If you were the Labor Arbiter, how would you decide the case? (4%)

SUGGESTED ANSWER:

I will dismiss the case. ADB enjoys immunity from suit (DFA v. NLRC, G.R.
No. 113191, September 18, 1996).

ALTERNATIVE ANSWER:

I will decide in favor of Luisa, by granting nominal damages. To clarify,

however, Luisa’s dismissal is not illegal, for it has been held that failure to
observe prescribed standards of work, or to fulfill reasonable work
assignments due to inefficiency, as in this case, may constitute just cause for
dismissal (Iluminada Ver Buiser v. Leogardo, Jr., G.R. No. L-63316, July 31,
1984, 131 SCRA 15). Nonetheless, the employer’s failure to comply with the
procedure prescribed by law in terminating the services of the employee
warrants the payment of nominal damages of Php 30,000, in accordance with
the Supreme Court’s ruling in the case of Agabon v. NLRC (G.R. No. 158693,
November 17, 2004).

2014 BAR QUESTION: Lanz was a strict and unpopular Vice-President for Sales
of Lobinsons Land. One day, Lanz shouted invectives against Lee, a poor
performing sales associate, calling him, among others, a “brown monkey.” Hurt,
Lee decided to file a criminal complaint for grave defamation against Lanz. The
prosecutor found probable cause and filed an information in court. Lobinsons
decided to terminate Lanz for committing a potential crime and other illegal acts
prejudicial to business. Can Lanz be legally terminated by the company on these
grounds? (4%)

SUGGESTED ANSWER:

No. The grounds relied upon by Lobinsons are not just causes for dismissal
under the Labor Code. Defamation is not a crime against person which is a
ground to dismiss under Art. 282, now Art. 295 (d) of the Labor Code.

2016 BAR QUESTION: Dion is an Accounting Supervisor in a trading company.

He has rendered exemplary service to the company for 20 years. His co-
employee and kumpadre, Mac, called him over the phone and requested him to
punch his (Mac's) daily time card as he (Mac) was caught in a monstrous traffic
jam. Dion acceded to Mac's request but was later caught by the Personnel
Manager while punching. Mac's time card. The company terminated the
employment of Dion on the ground of misconduct. Is the dismissal valid and
just? Explain. (5%)

SUGGESTED ANSWER:

Yes. The dismissal is valid and just. Dion’s act of punching Mac’s
timecard while the latter is not present is a form of dishonesty which is grave
and aggravated in character. Supervisory employee, like Dion, is outside the
protective mantle. Of the principle of social justice concealing the truth from
the company is clear disloyalty to the company which has long employed him.
Dion’s exemplary performance for twenty (20) years is not a valid justification
not to implement the dismissal because the longer an employee stays in the
service, the greater is his/her responsibility for compliance with the code of
disciple in the company. (Visayan Electric Company Union vs. Visayan Electric
Company and Reynaldo Hayan Moya vs. First Solid Rubber Industries)

2016 BAR QUESTION: Amaya was employed as a staff nurse by St. Francis
Hospital (SFH) on July 8, 2014 on a probationary status for six (6) months. Her
probationary contract required, among others, strict compliance with SFH's Code
of Discipline. On October 16, 2014, Dr. Ligaya, filed a Complaint with the SFH
Board of Trustees against Amaya for uttering slanderous remarks against the
former. Attached to the complaint was a letter of Minda, mother of a patient,
who confirmed the following remarks against Dr. Ligaya: "Bakit si Dr. Ligaya pa
ang napili mong 'pedia' eh ang tandatanda na n'un? E makakalimutin na yun xx x
Alam mo ba, kahit wala namang diperensya yung baby, ipinapa-isolate nya?" The SFH
President asks you, being the hospital's counsel, which of these two (2) options is
the legal and proper way of terminating Amaya: a) terminate her for a just cause
under Article 288 of the Labor Code (Termination by Employer); or b) terminate
her for violating her probationary contract. Explain. (5%)

SUGGESTED ANSWER:

I will recommend the termination of Amaya for her dishonesty and disloyalty
to SFH which is considered a serious misconduct under Article 297 of the
Labor Code. A probationary employee like Amaya, maybe terminated for just
and authorized causes, and for failure to meet the standards set by the
employer. SFH is engaged in a business whose actual survival is dependent on
the reputation of its medical practitioners. Amaya’s acts on imputing unethical
behavior and lack of professionalism to Dr. Ligaya are considered misconduct
which is a just cause of dismissal.

An employer may dismiss an employee on the following just causes:

a. serious misconduct;
b. willful disobedience;
c. gross and habitual neglect of duty;
d. fraud or breach of trust;
e. commission of a crime or offense against the employer, his family or
representative;
f. other similar causes.

The other grounds are authorized causes:

a. installation of labor-saving devices;
b. redundancy;
c. retrenchment to prevent losses;
d. closure and cessation of business; and
e. disease / illness.
(Bar Reviewer Labor and Social Legislation, Caingat Jr., 2020, pp 657)

2017 BAR QUESTION: What are the grounds for validly terminating the
services of an employee based on a just cause? (5%)

SUGGESTED ANSWER:

The grounds for validly terminating the services of an employee based on a

just cause are the following:
 1. Serious misconduct or willful disobedience by the employee of the
lawful orders of his employer or representative in connection with his
work;
2. Gross and habitual neglect by the employee of his duties;
3. Fraud or willful breach by the employee of the trust reposed in him by
his employer or duly authorized representative;
4. Commission of a crime or offense by the employee against the person of
his employer or any immediate member of his family or his duly
authorized representatives; and
5. Other causes analogous to the foregoing. (Article 282 of the Labor Code)

2017 BAR QUESTION: Give the procedure to be observed for validly

terminating the services of an employee based on a just cause? (4%)

SUGGESTED ANSWER:

The procedure to be observed for validly terminating the services of an

employee based on a just cause is as follows:

1. The first written notice must contain (a) the just cause as enumerated
under Article 297 of the Labor Code and (b) details the specific nature or
the circumstances the serve as the basis for his termination. (c) Such
notice must afford the employee ample opportunity and time to defend
himself from the charges by giving him the directive to submit a written
explanation.

2. The employee must be afforded ample opportunity to defend himself

from the allegations resulting to the decision of his termination by a
hearing or conference with all the parties involved.

3. If the company decides to continue his termination on the ground that it

is justified, a second written notice of termination must be given to the
employee detailing the specific circumstances that led to his
termination. It must indicate that (a) all circumstances involving the
charge against the employee have been considered; and (b) the grounds
have been established to justify the severance of their employment.
 (Distribution & Control Products, Inc., and Nincent M. Tiamsic, v. Jeffrey
E. Santos, G.R. No. 212616, July 10, 2017)

TERMINATION BY AUTHORIZED CAUSES

2014 BAR QUESTION: An accidental fire gutted the JKL factory in Caloocan.
JKL decided to suspend operations and requested its employees to stop
reporting for work. After six (6) months, JKL resumed operations but hired a
new set of employees. The old set of employees filed a case for illegal dismissal.

If you were the Labor Arbiter, how would you decide the case? (4%)

SUGGESTED ANSWER:

I will rule in favor of the employees. JKL factory merely suspended its
operations as a result of the fire that gutted its factory. Art. 286 of the Labor
Code states that an employer may bona fide suspend the operation of its
business for a period not exceeding six (6) months. In such a case, there would
be no termination of the employment of the employees, but only a temporary
displacement. Since the suspension of work lasted more than six months, there
is now constructive dismissal (Sebuguero v. NLRC, G.R. No. 115394,
September 27, 1995, 245 SCRA 532).

2014 BAR QUESTION: Luisa Court is a popular chain of motels. It employs over
thirty (30) chambermaids who, among others, help clean and maintain the
rooms. These chambermaids are part of the union rank-and-file employees which
has an existing collective bargaining agreement (CBA) with the company. While
the CBA was in force, Luisa Court decided to abolish the position of
chambermaids and outsource the cleaning of the rooms to Malinis Janitorial
Services, a bona fide independent contractor which has invested in substantial
equipment and sufficient manpower. The chambermaids filed a case of illegal
dismissal against Luisa Court. In response, the company argued that the decision
to outsource resulted from the new management’s directive to streamline
operations and save on costs.

If you were the Labor Arbiter assigned to the case, how would you decide? (4%)

SUGGESTED ANSWER:
I will decide in favor of Luisa Court, provided that all the requisites for a valid
retrenchment under the Labor Code are satisfied. It is management prerogative
to farm out any of its activities (BPI Employees UnionDavao City-FUBU
(BPIEU-Davao City-FUBU) v. Bank of the Philippine Islands, G.R. No. 174912,
July 24, 2013).

ALTERNATIVE ANSWER:

I will decide in favor of the chambermaids. Art. 248 (c) of the Labor Code
considers as unfair labor practice on the part of Luisa Court its “contract out
the services or functions being performed by union members.” Luisa Court’s
abolition and act of outsourcing the chambermaids’ positions are clearly acts
of illegal dismissal.

REINSTATEMENT

2014 BAR QUESTION: Despite a reinstatement order, an employer may choose

not to reinstate an employee if: (1%)

(A) there is a strained employer-employee relationship

(B) the position of the employee no longer exists

(C) the employer’s business has been closed

(D) the employee does not wish to be reinstated.

SUGGESTED ANSWER:

(D) the employee does not wish to be reinstated (DUP Sound Phils. v. CA,
G.R. No. 168317, November 21, 2011).

Article 218 and 264 of the same Code.

2019 BAR QUESTION Because of dwindling sales and the consequent limitation
of production, rumors were rife that XYZ, Inc. would reduce its employee force.
The next day, the employees of XYZ, Inc. received a notice that the company will
have a winding down period of 10 days, after which there will be a 6-month
suspension of operations to allow the company to address its precarious financial
position.
On the 4th month of suspension of its operations XYZ, Inc. posted announcement
that it will resume its operations in 60 days but at the same time announced that
instead of closing down due to financial losses, it will retrench 50% of the work
force.

a. Is the announcement that there would be retrenchment affecting 50% of

the work force sufficient compliance with the legal requirements for
retrenchment? Explain.

SUGGESTED ANSWER:

No, the announcement that there would be retrenchment affecting 50% of the
work force is not sufficient compliance with the legal requirements for
retrenchment. Article 298 of the Labor Code is clear in requiring the employer
of the twin serving of a written notice on the (1) workers and the (2) Ministry
of Labor and Employment at least one month before the intended date of
retrenchment. XYZ failed in both service requirements: it did not notify the
Ministry of Labor and Employment, and it did not sufficiently meet the
requirement of notice towards its workers. (Article 298 of the Labor Code,
Galaxie Steel Workers Union et.al., v. NLRC, Galaxie Steel Corporation and
Ricardo Cheng, G.R. No. 165757, October 17, 2006)

b. Assuming that XYZ, Inc., instead of retrenchment, extended the

suspension of its operations from 6 months to 8 months, would the same
be legally permissible? If not, what are the consequences?

SUGGESTED ANSWER:

The extension of the suspension of its operations from 6 months to 8 months is

not legally permissible. Article 301 of the Labor Code prohibits the suspension
or cessation of a business or undertaking for a period of more than 6 months.
If such suspension continues,the employer is required to reinstate the
employee to its former position without loss of seniority rights. Should XYZ
Inc. fail to do so, the employee is deemed to be constructively dismissed.
(Article 301 of the Labor Code)

BACKWAGES

2019 BAR QUESTION: After due proceedings, the Labor Arbiter (LA) declared
Mr. K to have been illegally dismissed by his former employer, AB, Inc. As a
consequence, the LA directed ABC, Inc. to pay Mr. K separation pay in lieu of
reinstatement as well as his full backwages. While ABC, Inc. accepted the finding
of illegal dismissal, it nevertheless filed a motion for reconsideration, claiming
that the LA erred in awarding both separation pay and full backwages, and
instead, should have ordered Mr. K’s reinstatement to his former position
without loss of seniority rights and other privileges, but without payment of
backwages. In this regard, ABC, Inc. pointed out that the LA’s ruling did not
contain any finding of strained relations or that reinstatement was no longer
feasible. In any case, it appears that no evidence was presented on this score.

(a) Is ABC, Inc.’s contention to delete the separation pay, and instead,
order reinstatement without backwages correct? Explain. (3%)

(b) Assuming than on appeal, the National Labor Relations Commission

(NLRC) upholds the decision of the LA, where, how, and within what
timeframe should ABC, Inc. assail the NLRC ruling? (2%)

SUGGESTED ANSWERS:

a. As to separation pay, the LA’s decision fails to state that there is a bar to
reinstatement; hence, he should have ordered reinstatement; hence, he
should have ordered reinstatement pursuant to the general rule
prescribed by Art. 294 of the Labor Code. Since the alternative relief of
separation pay is an exception, it must be justified with a reinstatement
bar. As to back wages, however, it cannot be deleted because it is a logical
consequence of a finding of illegal dismissal [ICT Marketing Services,
Inc. v. Mariphil Sales, GR 202090, Sept. 9, 2015]. Hence, absent any reason
for limiting or withholding it, it should be awarded as it was awarded by
the LA.

b. After the denial of the appellant’s motion for reconsideration, the NLRC’s
decision and order of denial can be assailed under Rule 65 of the Rules of
Court through the filing a petition for certiorari within 60 days from
receipt of said denial order. Correction of error of jurisdiction, resulting in
the nullification of the assailed dispositions, should be sought based on
the NLRC’s grave abuse of its appellate power amounting to lack of or
excess of jurisdiction.

RECOVERY OF BACKWAGES BY THE EMPLOYER

2017 BAR QUESTION: Juanito initiated a case for illegal dismissal against
Mandarin Company. The Labor Arbiter decided in his favor, and ordered his
immediate reinstatement with full backwages and without loss of seniority and
other benefits. Mandarin Company did not like to allow him back in its premises
to prevent him from influencing his co-workers to move against the interest of
the company; hence, it directed his payroll reinstatement and paid his full
backwages and other benefits even as it appealed to the NLRC.

A few months later, the NLRC reversed the ruling of the Labor Arbiter and
declared that Juanito's dismissal was valid. The reversal ultimately became final.

May Mandarin Company recover the backwages and other benefits paid to
Juanito pursuant to the decision of the Labor Arbiter in view of the reversal by
the NLRC? Rule, with reasons. (2.5%)

SUGGESTED ANSWER:

No, Mandarin Company can no longer recover the backwages and other
benefits paid to Juanito in view of the reversal of the Labor Arbiter’s decision
of the NLRC. The social justice principles of labor law outweigh or render
inapplicable the civil law doctrine of unjust enrichment. Otherwise, the
"refund doctrine" easily demonstrates how a favorable decision by the Labor
Arbiter could harm, more than help, a dismissed employee. (Juanito A. Garcia
and Alberto J. Dumago v. Philippine Airlines, Inc., G. R. No. 164856, July 20,
2009)

ATTORNEY’S FEE AND LEGAL INTEREST

2016 BAR QUESTION: In a case for illegal dismissal and non-payment of

benefits, with prayer for Damages·, Apollo was awarded the following: 1)
P200,000.00 as backwages; 2) P80,000.00 as unpaid wages; 3) P20,000.00 as
unpaid holiday pay; 4) PS,000.00 as unpaid service incentive leave pay; 5)
P50,000.00 as moral damages; and 6) P10,000.00 as exemplary damages.
Attorney's fees of ten percent (10%) of all the amounts covered by items 1 to 6
inclusive, plus interests of 6% per annum from the date the same were
unlawfully withheld, were also awarded.

a. Robbie, the employer, contests the award of attorney fees amounting to

10% on all the amounts adjudged on the ground that Article 111 of the
Labor Code authorizes only 10% "of the amount of wages recovered". Rule
on the issue and explain. (2.5%)
SUGGESTED ANSWER:

The attorney’s fees should be granted to Robbie. There are two commonly
accepted concepts of attorney’s fees, the so-called ordinary and extraordinary.
In its ordinary concept, an attorney’s fee is the reasonable compensation paid
to a lawyer by his client for the legal services he has rendered to the latter. The
basis of this compensation is the fact of his employment by and his agreement
with the client. In its extraordinary concept, attorney’s fees are deemed
indemnity for damages ordered by the court to be paid by the losing party in a
litigation. The instances where these may be awarded are those enumerated in
Article 2208 of the Civil Code, specifically par. 7 thereof which pertains to
actions for recovery of wages, and is payable not to the lawyer but to the client,
unless they have agreed that the award shall pertain to the lawyer as
additional compensation or as part thereof. The extraordinary concept of
attorney’s fees is the one contemplated in Article 111 of the Labor Code, which
provides: Art. 111. Attorney’s fees.—(a) In cases of unlawful withholding of
wages, the culpable party may be assessed attorney’s fees equivalent to ten
percent of the amount of wages recovered x x x The aforequoted Article 111 is
an exception to the declared policy of strict construction in the awarding of
attorney’s fees. Although an express finding of facts and law is still necessary
to prove the merit of the award, there need not be any showing that the
employer acted maliciously or in bad faith when it withheld the wages. There
need only be a showing that the lawful wages were not paid accordingly. (PCL
Shipping Philippines, Inc. vs. National Labor Relations Commission, 511 SCRA
44, G.R. No. 153031 December 14, 2006)

a. Robbie likewise questions the imposition of interests on the amounts in

question because it was not claimed by Apollo, and the Civil Code
provision on interests does not apply to a labor case. Rule on the issue
and explain. (2.5%)

SUGGESTED ANSWER:

It is now well-settled that generally, legal interest maybe imposed upon any
unpaid wages, salary differential, merit increases, productivity bonuses,
separation pay, backwages on other monetary claims and benefits awarded
illegally dismissed employees. It’s grant however remains discretionary upon
the courts. (Lim vs. HMR Philippines, Inc., 731 SCRA 576, G.R. No. 201483
August 4, 2014) Legal interest was imposed on all monetary awards by the SC
in the case of Bani Rural Bank, Inc. vs. De Guzman, 709 SCRA 330, G.R. No.
170904 November 13, 2013 thee Court therein declared that imposition of legal
interest in any final and executory judgment does not violated the
immutability principle. The Court ruled that once a decision in a labor case
becomes final, it becomes a judgment for money from which another
consequence follows the payment of interest in case of delay.

APPEAL BOND

2016 BAR QUESTION: Filmore Corporation was ordered to pay P49 million to
its employees by the Labor Arbiter. It interposed an appeal by filing a Notice of
Appeal and paid the corresponding appeal fee. However, instead of filing the
required appeal bond equivalent to the total amount of the monetary award,
Filmore filed a Motion to Reduce the Appeal Bond to P4,000,000.00 but submitted
a surety bond in the amount of P4.9 million. Filmore cited financial difficulties as
justification for its inability to post the appeal bond in full owing to the
shutdown of its operations. It submitted its audited financial statements showing
a loss of P40 million in the previous year. To show its good faith, Filmore also
filed its Memorandum of Appeal. The NLRC dismissed the appeal for non-
perfection on the ground that · posting of an appeal bond equivalent to the
monetary award is indispensable for the perfection of the appeal and the
reduction of the appeal bond, absent any showing of meritorious ground to
justify the same, is not warranted. Is the dismissal of the appeal correct? Explain.
(5%)

SUGGESTED ANSWER:

No, the appeal’s dismissal is incorrect. The bond requirement on appeals

may be relaxed when there is substantial compliance with the NLRC Rules of
Procedure or when the appellant shows willingness to post a partial bond.
Filmore’s timely filing of a motion to reduce bond accompanied with the
posting of a provisional surety bond of P4.9 Million, which is at least 10% of
the judgment awards, excluding damages and attorney’s fee, will stop the
running of the 10-day reglementary period to perfect the appeal. The NLRC
then will proceed to resolve the motion to reduce bond and determine the final
amount of bond taking into consideration the reasonable amount and the
merits of the case. Should the NLRC deny the motion to reduce bond or if it
requires Filmore to post a bond that exceeds the provisional bond, he shall be
given a fresh period of ten (10) days from notice of the NLRC’s order by
posting the required bond. (Manila Mining vs. Lowito Amor, G.R. No. 182800,
April 15, 2015, Perez, J.; Bar Reviewer Labor and Social Legislation, Caingat Jr.,
2020, pp 950-951)

PRESCRIPTION PERIOD

2019 BAR QUESTION: For purposes of prescription, within what periods from
the time the cause of action accrued should the following cases be filed:
(a) Money claims arising from employer-employee relations (1%)
(b) Illegal dismissal (1%)
(d) Offenses under the Labor Code (1%)
(e) Illegal recruitment (1%)

SUGGESTED ANSWERS:
For purposes of prescription, within what periods from the time the
cause of action accrued should the following cases be filed:
(a) Money claims arising from employer-employee relations – within 3
years from date they become a legal possibility or can be judicially
brought [Art. 306, LC; Art. 1150, NCC; Anabe v. Asian Construction, GR
183233, Dec. 23, 2009]
(b) Illegal dismissal – within 4 years from complete severance of employer-
employee relationship or date of salary/positional downgrade [Art. 1146,
NCC; Orchard Golf & Country Club v. Francisco, GR 178125, March 18,
2013]
(c) Unfair labor practice – not later than 1 year from date of commission
[Art. 305, LC]. As to its criminal aspect, it shall be prosecuted within 3
years from date of finality of the ULP judgment [Art. 305, LC]
(d) Offenses under the Labor Code – within 3 years from date of
commission [Art. 305, LC]
(e) Illegal recruitment – within 5 years if simple illegal recruitment, and
within 20 years if economic sabotage [Sec. 7, Rule IV, RA 10022]

RETRENCHMENT

2016 BAR QUESTION: Hagibis Motors Corporation (Hagibis) has 500 regular
employees in its car assembly plant. Due to the Asian financial crisis, Hagibis
experienced very low car sales resulting to huge financial losses. It implemented
several cost-cutting measures such as cost reduction on use of office supplies,
employment hiring freeze, prohibition on representation and travel expenses,
separation of casuals and reduced work week. As counsel of Hagibis, what are
the measures the company should undertake to implement a valid
retrenchment? Explain. (5%)

SUGGESTED ANSWER:

The following requisites must be complied with before implementing the

retrenchment program such as:
a. the retrenchment are reasonably necessary and likely to prevent
business losses;
b. the losses are not merely “de minimis”, but substantial, serious, and
actual and real, or if only expected, are reasonably imminent;
c. the expected or actual losses is proven by sufficient and convincing
evidence;
d. the retrenchment is in good faith; and
e. there is fair and reasonable criteria in ascertaining who would be
dismissed and who would be retained among the employees, such
as status, efficiency, seniority, physical fitness, age, and financial
hardship for certain workers.
(Sec. 5.4, [c], Department Order No. 147-15, series of 2015; Caingat Jr.,
2020, Bar Reviewer Labor and Social Legislation, pp 736)

SEPARATION PAY

2014 BAR QUESTION: Lizzy Lu is a sales associate for Luna Properties. The
latter is looking to retrench Lizzy and five other sales associates due to financial
losses. Aside from a basic monthly salary, Lizzy and her colleagues receive
commissions on the sales they make as well as cost of living and representation
allowances. In computing Lizzy’s separation pay, Luna Properties should
consider her: (1%)

(A) monthly salary only

(B) monthly salary plus sales commissions

(C) monthly salary plus sales commissions, plus cost of living allowance

(D) monthly salary plus sales commissions, plus cost of living allowance and
representation allowance
SUGGESTED ANSWER:

(C) monthly salary plus sales commissions, plus cost of living allowance
and representation allowance (Songco v. NLRC, G.R. No. L-50999,
March 23, 1990).

2017 BAR QUESTION: Due to business recession, Ballistic Company retrenched

a part of its workforce. Opposing the retrenchment, some of the affected
employees staged a strike. Eventually, the retrenchment was found to be
justified, and the strike was declared illegal; hence, the leaders of the strike,
including the retrenched employees, were declared to have lost their
employment status.

Are the striking retrenched employees still entitled to separation pay under Sec.
298 (283) of the Labor Code despite the illegality of their strike? Explain your
answer. (2%)

SUGGESTED ANSWER:

Yes, the striking workers are still entitled to a separation pay. Retrenchment is
the termination of employment initiated by the employer through no fault of
and without prejudice to the employees. The employer must pay the
retrenched employees separation pay equivalent to one month pay or at least
½ month pay for every year of service, whichever is higher, irrespective of the
illegality of the strike.

RETIREMENT

2018 BAR QUESTION: Narciso filed a complaint against Norte University for
the payment of retirement benefits after having been a part-time professional
lecturer in the same school since 1974. Narciso taught for two semesters and a
summer term for the school year 1974-1975, took a leave of absence from 1975 to
1977, and resumed teaching until 2003. Since then, his contract has been renewed
at the start of every semester and summer, until November 2005 when he  was
told  that he could no longer teach because he was already 75 years old. Norte
University also denied Narciso’s claim for retirement benefits stating that only
full-time permanent faculty, who have served for at least five  years  immediately
preceding the termination of their employment, can avail themselves of post-
employment benefits. As part-time faculty member, Narciso did not acquire
permanent employment status under the Manual of Regulations for Private
Schools, in relation to the Labor Code, regardless of his length of service.

(A) Is Narciso entitled to retirement benefits? (2.5%)

SUGGESTED ANSWER:

As a part-time employee with fixed-term employment, Narciso   is entitled to

retirement benefits. Book VI, Rule II of the Rules Implementing the Labor
Code states that the rule on  retirement shall apply to all employees in the
private sector, regardless of their position, designation or status and
irrespective of the method by which their wages are paid, except to those
specifically exempted. Part-time faculty members do not fall under the
exemption. Based also on the Retirement Pay Law, and its Implementing
Rules, part-time faculty members of private educational institutions are
entitled to full retirement benefits even if the services are not continuous, and
even if their contracts have been renewed after their mandatory age of
retirement.

(B) If he is entitled to retirement benefits, how should retirement pay  be

computed in the absence of any contract between  him and  Norte University
providing for such benefits? (2.5%)

SUGGESTED ANSWER:

In the absence of any contract providing for higher retirement benefits, private
educational institutions, including Norte University, are obligated to set aside
funds for the retirement pay of all its part-time faculty members. A covered
employee who retires pursuant to the Retirement Pay Law shall be entitled to
retirement pay equivalent to at least one-half (1/2) month salary for every year
of service, a fraction of at least six(6) months being considered as one whole
year. One-half  month salary shall mean fifteen (15) days plus one-twelfth
(1/12) of the 13th month pay and the cash equivalent of not more than five (5)
days service incentive leaves. In total, this should amount to 22.5 days for
every year of service (De La Salle Araneta University v. Bernardo, G.R. No. 
190809,  February 13, 2017).
2019 BAR QUESTION: Discuss the differences between compulsory and
voluntary/optional retirement as well as the minimum benefits provided under
the Labor Code for retiring employees of private establishments.

SUGGESTED ANSWER:

Compulsory retirement refers to the absence of a retirement plan or agreement

providing for retirement benefits of employees in the establishment, an
employee upon reaching the age of sixty (60) years or more, but not beyond
sixty-five (65) years which is hereby declared the compulsory retirement age,
who has served at least five (5) years in the said establishment, may retire and
shall be entitled to retirement pay equivalent to at least one-half (1/2) month
salary for every year of service, a fraction of at least six (6) months being
considered as one whole year.

A Voluntary/Optional Retirement on the other hand is granted to any

employee that reaches the retirement age established in the collective
bargaining agreement or other applicable employment contract. (Article 302 of
the Labor Code)

DEATH

Sgt. Nemesis was a detachment non-commissioned officer of the Armed Forces

of the Philippines in Nueva Ecija. He and some other members of his detachment
sought permission from their Company Commander for an overnight pass to
Nueva Vizcaya to settle some important matters. The Company Commander
orally approved their request  and  allowed  them  to carry their firearms as the
place they were going to was classified as a “critical place.” They arrived at the
place past midnight; and as they  were alighting  from a tricycle, one of his
companions accidentally dropped his rifle, which fired a single shot, and in the
process hit Sgt.  Nemesis fatally. The shooting  was purely accidental. At the time
of his death, he was still legally married to Nelda, but had been separated de facto
from her for 17 years. For the last 15 years of his life, he was living in with Narda,
with whom he has two minor children. Since Narda works as a kasambahay, the
two children lived with their grandparents, who provided their daily support.
Sgt. Nemesis and Narda only sent money to them every year to pay for their
school tuition.
Nelda and Narda, both for themselves and the latter, also on behalf of her minor
children, separately filed claims for compensation as a result of the death of Sgt.
Nemesis. The line of Duty Board of the AFP declared Sgt. Nemesis’ death to have
been “in line of duty”, and recommended that all benefits due to Sgt. Nemesis be
given to his dependents. However, the claims were denied by GSIS because Sgt.
Nemesis was not in his workplace nor performing his duty  as a soldier of the
Philippine Army when he died.

(A) Are the dependents of Sgt. Nemesis entitled to compensation as a result of

his death? (2.5%)

SUGGESTED ANSWER:

The death of Sgt. Nemesis arose out of and in the course of his employment as
a soldier on active duty in the AFP and hence, compensable. The concept of a
“workplace” cannot always be literally applied to a soldier on active duty. Sgt.
Nemesis had permission to go to Nueva Vizcaya and he and his companions
had permit to carry their firearms, which they could use to defend themselves
when attacked. A soldier on active duty is really on duty 24 hours a day since
he can be called upon anytime by his superiors, except when he is on vacation
leave status, which Sgt. Nemesis was not, at the time of his death (Hinoguin v.
ECC, G.R. No. 8430, April 17, 1989).

(B) As between Nelda and Narda, who should be entitled to the benefits? (2.5%)

SUGGESTED ANSWER:

To be considered as a beneficiary, the spouse must be the legal spouse and

living with the employee at the time of his death. Nelda, as the surviving
spouse who has been separated de facto from the deceased employee, may still
however be entitled if  the separation was due to the covered employee’s 
abandonment of the spouse without valid reason, or for other justifiable
reasons. Narda, not being a  legitimate spouse,  is  not entitled to the benefits;
however, the ECC may act as referee and arbitrator between two (2) claimants
to help each other reach a mutually acceptable compromise settlement of
allocating the compensation among themselves and their dependent children
(Samar Mining Co. Inc. v. WCC, G.R. No. L-29938-39, March 31, 1971).

(C) Are the minor children entitled to the benefits considering that they were not
fully dependent on Sgt. Nemesis for support? (2.5%)
SUGGESTED ANSWER:

Being a dependent does not mean absolute dependency for the necessities of
life, but rather, that the claimant looked up to and relied on the contribution of
the covered employee for his means of living as determined by his position in
life. One need not be in the deceased’s household in order to be a dependent.
(Malate Taxicab v. Del Villar G.R. No. L-7489, Feb. 29, 1956).

2017 BAR QUESTION: Gene is a married regular employee of Matibay

Corporation. The employees and Matibay Corporation had an existing CBA that
provided for funeral or bereavement aid of ₱15,000.00 in case of the death of a
legal dependent of a regular employee. His widowed mother, who had been
living with him and his family for many years, died; hence, he claimed the
funeral aid. Matibay Corporation denied the claim on the basis that she had not
been his legal dependent as the term legal dependent was defined by the Social
Security Law.

a. Who may be the legal dependents of Gene under the Social Security Law?
(2.5%)

SUGGESTED ANSWER:

The legal dependents of Gene under the Social Security Law are:

1. His legitimate dependent spouse until he or she remarries;

2. His dependent legitimate, legitimated or legally adopted, and

illegitimate children, who are not yet 21 years old, or if older than 21
years old;

3. His dependent parents who are considered the secondary beneficiaries.

4. In the absence of both primary and secondary beneficiaries, any other

person designated by Gene in his SSS records shall be considered as the
beneficiary. (Section 8 of the Social Security Law, RA1161)

b. Is Gene entitled to the funeral aid for the death of his widowed mother?
Explain your answer. (2%)
SUGGESTED ANSWER:

Yes, Gene is entitled to the funeral aid for the death of his widowed mother.
The entitlement to the funeral aid is lodged in the existing CBA between the
employees and Matibay Corporation that provides for funeral or bereavement
aid of ₱15,000.00 in case of the death of a legal dependent of a regular
employee.

2019 BAR QUESTION: X is a member of the Social Security System (SSS). In

2015, he died without any spouse or children. Prior to the semester of his death,
X had paid 36 monthly contributions. His mother, M, who had previously been
receiving regular support from X, filed a claim for the latter’s death benefits.
(a) Is M entitled to claim death benefits from the SSS? Explain. (2.5%)
(b) Assuming that X got married to his girlfriend a few days before his
death, is M entitled to claim death benefits from the SSS? Explain. (2.5%)

SUGGESTED ANSWERS:

a. Yes. Dependents shall be : (1) the legal spouse entitled by law to receive
support from the member; (2) the legitimate, legitimated or legally
adopted, and illegitimate child who is unmarried, not gainfully
employed, and has not reached twenty-one (21) years of age, or if over
twenty-one years of age, he is congenitaly or while still a minor has
been permanently incapacitated and incapable or self-support,
physically or mentally; and (3) the parent who is receiving regular
support from the member. (Section 8 {e}, R.A. No. 11199).
In this case, X have no spouse or children so his parents will be his
beneficiary.

b. Yes. It is clear from the statutory definition of dependent that the civil
status of the employee as either married or single is not the controlling
consideration in order that a person may qualify as the employee’s legal
dependent. What is rather decidedly controlling is the fact that the
spouse, child, or parent is actually dependent for support upon the
employee. (Philippine Journalists, Inc. vs. Journal Employees Union
(JEU), G.R. No. 192601, June 3, 2013, 697 SCRA 103, Bersamin, J.)