I.

INTRODUCTION

The 1987 Philippine Constitution strengthens the guarantee of social justice towards its
people. Social justice fosters individual’s right to equitable treatment and the right to have a
decent condition of life, free from discrimination and assurance of the protection of individual’s
welfare from being prejudiced and constrained. However, fair as it may seem, still this has been
challenged with inevitable circumstances and abusive exercise of power. The main factor that
challenges the attainment of social justice is diversity. Diverse customs, beliefs, interpretation of
the law and the constant change of society’s standard resulted to chaotic society. This is the
rationale in the creation of justice system and its instrumentalities in its aim to implement
impartiality amidst diversity. Philippines as composed of different sectors having distinctive
mandate, its justice system is also established by sector, may it be industrial, agricultural,
commercial or labor, for the expeditious settlement of disputes and speedy disposition of cases.
These judicial, quasi-judicial and administrative bodies have the same end which is the
promotion of social justice through the protection of the interests and rights of both parties.
Despite the strategic approach employed by the Philippines in its existing judicial system,
controversies and challenges still emanate. These challenges are the hindering factors in attaining
a just and impartial adjudication. These include delay disposition of cases, costly nature of the
litigation proceedings, clog of docketed cases in the court, and the poor access to justice by the
pauper parties. Anent to this, a mechanism has been administered to the Philippine justice system
in order to address the aforementioned challenges. Hence, the Alternative Dispute Resolution
(ADR). Dispute resolution in the Philippines is aimed in the settlement of controversies over a
person or group of persons’ rights which are legally demandable and enforceable. Dispute
settlement freedom of the adverse parties to transpire for arrangements and to resolve the
existing dispute between them.
In the labor market, it is noteworthy that the contrasting rights and interests of the
employers and their respective employees amount to dysfunctional employer-employee
relationship. Existence of labor disputes will gravely affect the status of the labor market which
may negatively influence the economic condition of the country. Thus, to address labor disputes,
Department of Labor and Employment was established. This government agency is mandated to
promote full employment, afford equal opportunities and sustain welfare of the labor. For the
past years, the resolution of labor dispute is mainly enforced through compulsory arbitration,
which necessitates third-party intervention without the opportunity for several mediation
conferences, hence, not advantageous to the parties especially the impoverish workers.
Fortunately, series of reformulation of Philippine labor dispute adjudication were enforced which
seeks to develop labor market and uphold social welfare by the promotion of industrial peace
through the institution of collective bargaining agreement and voluntary dispute settlement.
The issue under consideration is the efficacy of the mechanism employed by the agency
and its quasi-judicial and administrative bodies. A dispute resolution that affords justice to both
parties with the paramount consideration to the aggrieved parties which are usually the workers
shall be considered. This paper presents the guarantee of the Labor Code in labor dispute
matters. The existing labor dispute settlement that has been enforced by the designated agency,
its technical and substantial method of addressing the same, as well as labor dispute
jurisprudence and the remarks of parties-in-interest to the dispute shall be examined. With the
present labor dispute settlement as laid down by DOLE, NLRC and other allied agencies, this
paper examines whether or not the same is beneficial to both parties or unjust to workers
especially the poor.
 II. PRESENT DISPUTE SETTLEMENT

Sec. 3, Art. 13 of the 1987 Philippine Constitution provides for the promotion of shared
responsibility between employers and its respective workers and the preferential use of voluntary
modes in dispute settlement including conciliation method in order to foster industrial peace. 1
Moreover, Labor Code of the Philippines emphasizes the employment of other modes of settling
labor disputes through voluntary arbitration and mediation-conciliation. 2 The present dispute
settlement is anchored on these legal provisions which include plant level or company level
mechanism and third party intervention mechanism.

A. Grievance Machinery

Company level or the plant level mechanism involves the employment of grievance
machinery which serves as the venue for negotiation between the employer and employee. The
establishment of grievance machinery is provided by the Labor Code for the purpose of
resolution of grievances arising from the interpretation of the Collective Bargaining Agreement
and controversies relative to company personnel policies. Moreover, the intent of this mechanism
is to placidly and systematically settle disputes in order to voluntarily allow the parties-in-
interest to raise their concerns. An excerpt from the National Conciliation and Mediation Board
(NCMB) states that this subject machinery affords systematic procedure for a peaceful resolution
on labor disputes, which serves as the communication channel for the parties. 3 In cases of
unresolved issues despite exhaustion of this remedy, voluntary arbitration shall automatically be
referred to the parties.

B. Voluntary Arbitration

The other mechanism in discussion is the third party level method which necessitates an
intervention of an arbitrator. This refers to voluntary arbitration as one of the alternative tools in
dispute settlement. The manner of this method involves the selection by the parties for a
competent, trained and impartial person who shall take cognizance on the merits of the case and
render decision which is final, executory and binding. 4 The implementing agency of voluntary
arbitration is the National Conciliation and Mediation Board (NCMB), an agency under the
Department of Labor and Employment. The proceedings under this mechanism are non-litigious
in nature and comply with the observance of due process. Furthermore, the duties of arbitrators is
to exert best efforts to mediate the adverse parties in order to facilitate a voluntary settlement of
the dispute before proceeding with arbitration. Issues laid down by the parties shall be simplified
by the arbitrator and stipulation of facts that are still in dispute, eliminating the need for the
examination of evidence, shall be encouraged. This method is resorted in case of failure to
amicably settle the issue through the grievance machinery.

C. Conciliation-Mediation

One of the labor dispute settlements mechanisms which also necessitates the intervention
of a neutral third party is the Conciliation-Mediation. This is a non-litigious and a non-
adversarial mechanism which is implemented by the National Conciliation and Mediation Board.
Parties who resort to this method may settle their issue amicably as this aids parties towards
voluntary and willful resolution over the issues at hand in reaching a mutually acceptable
settlement. It is the preferred mode of resolution over points of concerns over unfair labor
practices and bargaining deadlock issues to prevent notice of strikes/lockouts and preventive
mediation cases from maturing into work stoppages. Moreover, agreements transpired before the
conciliation-mediator has legal effect and binding between the parties.
1
Sec. 3, Article XIII. The 1987 Constitution of the Republic of the Philippines.
2
Art. 211, Book V. Labor Code of the Philippines.
3
2018. Grievance Machinery on Settlement of Labor Disputes. Department of Labor and Employment.
4
Voluntary Arbitration Program. National Conciliation and Mediation Board.
 In line with the aim of the agency to improve its Conciliation-mediation mechanism, an
administrative approach which is referred as the Single Entry Approach (SEnA) was established
with the intent to promote speedy, impartial, inexpensive and accessible settlement procedure of
all labor controversies in order to prevent from ripening into actual labor cases. In this
mechanism, a SEnA Desk Officer serves as the neutral intervening party which is tasks to
facilitate the parties to effect amicable settlement over the dispute through providing advice and
probable and effective solutions to address the same. Moreover, this administrative approach sets
a period of 30 calendar days for conciliation and mediation. Agreements reached between the
parties are binding on all DOLE offices and its attached administrative bodies, provided that the
said agreement is not contrary to law, morals, public order and public policy.5

D. The 2011 NLRC Rules of Procedure

The aforementioned dispute settlement mechanisms are the preferred mode of dealing
disputes involving employer-employee relationship. Issues not being resolved through resorting
to the aforementioned mechanisms, ripens for adjudication. Full blown cases are under the
jurisdiction of Labor Arbiter and the National Labor Relations Commission. The proceedings
before the Labor Arbiter and the Commission are non-litigious in nature with the diligent
observance of due process. With regard to appearances, a non-lawyer may appear before the
Labor Arbiter and the Commission. Further, as laid down by the NLRC Rules of Procedure, a
mandatory conciliation and mediation conference shall be conducted in order to afford an
opportunity to settle amicably through a compromise agreement, simplifying the issues involve
in the case and threshing out all other preliminary matters. However, if parties fail to settle
amicably, the Labor Arbiter or the duly authorized personnel shall proceed to the merits of the
case. During the conduct of hearings, parties may be allowed to present testimonial evidence
with the right of cross-examination by the adverse party. The Labor Arbiter shall likewise render
his decision for a non-extendible period of 30 calendar days after the case is hereby deemed
submitted for resolution. Moreover, in cases when the aggrieved party is not satisfied with the
decision of the Labor Arbiter, he may be afforded with a remedy to appeal the assailed decision
to the National Labor Relations Commission which shall decide the matter and issue its
Certificate of Finality after 10 calendar days from receipt thereof by the authorized
representative, authorized representative or the parties themselves.6
III. Analysis on the Present Dispute Settlement

The existence of dispute between employer-employee relationships is mainly caused by

the respective diverse rights, interests and obligations. Workers paramount consideration is the
improvement of the status of their lives while the employers’ consideration is the prosperity of
their undertakings. These diverse objectives are the factors that the Philippine government
continuously addressing. The creation of these labor dispute settlement initiative is based on the
well-enshrined social justice for the sustainable economic growth through the attainment of
industrial peace.

Based on the preferred mode of dispute settlement and compulsory arbitration laid down
by the Department of Labor and Employment and its attached administrative and quasi-judicial
body, these mechanisms immensely affect the status of employer and employee individually and
most importantly, the affiliation between them.

a. Afford Access to Justice to both Employee and Employer

Every individual is afforded with access to justice as this is a basic principle of the rule of
law. The Philippine Constitution guarantee the right of an individual not to be deprived of life,
liberty or property without due process of law nor shall be denied the equal protection of laws. 7
This right encompasses the right of a person to access to justice in order for them to sing their
own song, assert and exercise their rights. The different modes established by the agency in
5
Single Entry Approach (SEnA). Department of Labor and Employment.
6
The 2011 NLRC Rules of Procedure, as Amended.
7
Sec. 1, Art. III. The 1987 Philippine Constitution.
dealing with dispute involving employer-employee relationship are manifestations of the
concerted effort of the government to extend the access of justice to the parties-in-interests in the
industry. Employees and employers are given wide latitude of approach in order to address their
differences. With regard to the preferred modes which includes the grievance machinery,
voluntary arbitration and conciliation-mediation mechanism, these involve non-adversarial issues
which judicial intervention is not necessary. These mechanisms may be the simplest one but
these provide for a great positive impact towards strengthening the relationship between the
employers and workers, especially as to poor workers and the enforcement of justice in the labor
realm. Moreover, the parties are not isolated to resort in one platform as they are given the
opportunity to be heard in a peaceful manner in dealing with their differences and claims. The
usual dispute settlement we may put in mind is with the intervention of judicial body which
entails pressure and individuals may be intimidated to speak for their grievances, may be due to
the formality inside the court. However, these can be avoided through the access to other modes
of settlement. The usual intent of the parties to obtain favorable resolution only for their side
over the other is inexistent in this mechanism. The objective of this mechanism is to settle
adverse claims relative to their interests, rather than aiming to win the same. The goal is to
preserve workplace relationship and to treat each other as partners in their respective endeavors
and not adversaries. These preferred methods of labor dispute settlement are anchored on the
principle that voluntary and mutual agreement between the employer and employee is the
foundation of industrial peace.

Another platform that the parties may exercise their right to be heard is through the
proceedings before the Labor Arbiter and NLRC. In this platform, parties are also given the
opportunity to present their issues, documentary evidence and other pertinent documents to
establish their claim through the assistance of a counsel, authorized representatives or their
personal appearance. This implies that problematic issues of the parties, when voluntary
arbitration failed to settle, can still be administered and be open for adjudication. The procedures
laid by the NLRC requires for the conduct of conciliation-mediation which will give another
opportunity of the parties to amicably settle their dispute. With these double-barreled
conciliation-mediation method, parties are not deprived of having their issues settled even
though the same was already lodged to the Commission.

b. Expeditious and Less Expensive Proceedings

Considering the non-litigious nature of the proceedings, these mechanisms facilitate to

expedite the settlement of the subject issues which in effect save personnel’s time and allow
them to continue their responsibilities in their respective jobs. This is also advantageous to the
poor employees as it is a less expensive in nature, as it eliminates the usual lengthy proceedings
and may or may not necessitate the assistance of a lawyer during the proceedings before the
NLRC. The consequence if the method to be resorted is too costly due to the time-frame of the
proceedings, the travelling to be incurred by the parties, and other miscellaneous expenses, is
that employee’s welfare will be prejudiced. It is prejudicial in the sense that their supposed to be
saved income may be allocated along the process of dealing with legal technicalities. The speedy
disposition of cases is strengthen through an innovative and strategic approach towards
improving the cooperation of employer and employees with the employment of Single Entry
Approach (SEnA), a 30-day period is given for the settlement of the case for a fast, simple, least
costly and beneficial to both parties. In the late of 2020, the DOLE shortened the period of
settlement through SENA for a period of 15 days, shorter period, the faster the resolution of
cases. In effect, these mechanism as a consequence, de-clog the docketed cases which is an
efficient tool to comply with the directive of speedy disposition of cases.

These mechanisms however entails its disadvantages taking into account the other side of
the story. There is no doubt on the effectiveness of these implementations but these are
challenged with some drawback which shall be the basis on its improvement. An article from the
NOLO Press expressed the disadvantages of arbitration in resolving legal disputes which
includes the existence of uneven playing field which refers to the situation where the statement
“take-it-or-leave-it” be the nature of arbitration which may only be favorable to the employer
when challenged by less fortunate employees. This case has the opportunity to emerge in the
arbitration proceedings between the worker and employer as the former will opt to take the offer
of its employer regardless of the dissatisfaction of his claim or grievance, especially if this
employee solely depends on one source of income for the sustenance of his living conditions.
Moreover, the article expressed another drawback which is the lack of transparency. Considering
the manner of the proceedings which is done privately rather than in an open courtroom, this
may lead the arbitration proceedings more likely to be tainted with bias which is usually at the
expense of the less powerful party, the employee.8 Further, another hindering factor in the
successful implementation of voluntary arbitration, is the inconsiderate nature of adverse parties
as they only focus on the individual fulfillment of their interests rather than resolving the main
issue. With relevance to the access to justice by the less fortunate party which is the employee, it
is established that the mechanism which does not necessitate the appearance of counsel is
favorable to them due to the eliminated attorney’s fees, however, this may be a venue for the
emergence of unfair treatment. An employee who is representing for himself or the ones who is
afforded with the assistance of a free counsel is unlikely to have a legal counsel who is as
effective compared to the employer who can afford one. In this sense, poor employees are at
stake. Based on the findings of Institute for Labor Studies relative to the labor dispute settlement
in the Philippines, with regard to the submission of pleadings to the Commission, pleadings
which are prepared by non-lawyers negatively affect the complainant-worker considering the
fact that non-lawyers are not proficient on the rule of law, hence claims may not be
substantiated.9

IV. Jurisprudence, Comments of Employers and other Parties in Labor Realm

The Philippine Constitution guarantee that the State shall afford full protection to labor,
local and overseas, organized and unorganized, and promote full employment and equality of
employment opportunities for all.10 Moreover, Article 4 of the Labor Code of the Philippines
provides that in case of doubts in the implementation and interpretation of the provisions of the
Code, it shall be resolved in favor of labor.11 On the issue of the advantage of employees
especially the poor relative to the adjudication of cases, the State’s policy in the protection of
workers is evident with the following jurisprudence.

In the case of Yulo versus Concentrix Daksh Services Philippines involving the issue of
illegal dismissal, the former is an employee of the latter as a Customer Care Specialist-
Operations. The company inform her that he will be re-assigned to other accounts as there is an
intention of right sizing the headcount of the account due to business requirements. Failure of the
employer to re-assign him to other accounts prompted him to file a complaint for constructive
illegal dismissal, non-payment of wages, damages and other claims and benefits. However, his
employer contended that the grounds for legal termination is founded on redundancy. The Labor
Arbiter and the NLRC found that Yulo was illegally dismissed. The ruling of the Supreme Court
is in favor of the employee upholding the findings of the labor tribunals, ordered the
reinstatement of Yulo for his former position without loss of seniority rights, and to pay him his
backwages, 13th month pay as well as moral an exemplary damages.12 This case is a
manifestation of concurrence of the judicial body to the state policy enshrined in the
Constitution. They are given the opportunity to be heard, hence the decision in favor of the
petitioner cannot be defeated due to the fact that the employer presented its documentary
evidence purporting the compliance of redundancy requirements which the latter failed to justify
further.

Meanwhile, there is a case which the Court of Appeals ruled against the employer, the
Business Process Outsourcing, upholding the decision of the Labor Tribunal. This case involves
the issue of constructive dismissal wherein the NLRC issued its Order directing the company to
pay back wages from the dismissal of de Guzman until the decision attained its finality,

8
Barbara Kate Repa. Arbitrations Pros and Cons. NOLO Press.
9
Cabadaonga, 2010. Towards Attaining Harmony at the Workplace. An Assessment of Dispute Settlement.
Mechanism in the Philippines Towards Policy Reformulation. Institute for Labor Studies.
10
Sec. 3, Article 13. The 1987 Constitution of the Republic of the Philippines.
11
Art. 4. The Labor Code of the Philippines.
12
Yulo v. Concentrix Daksh Services Philippines, Inc. G.R No. 235873. January 21, 2019
separation pay in lieu of reinstatement, 13 th-month pay and attorney’s fees.13 This case also
implies that Labor Tribunals are promoting the protection of workers. The monetary awards
being ordered is justifiable means of recompensating the employees deprived of their right in the
labor market. This was also upheld in the decision rendered by the Supreme Court declaring
petitioners illegally dismissed. Moreover the Court emphasized that an employee who is illegally
dismissed is entitled to reinstatement without loss of seniority rights and other privileges. In case
where the reinstatement proves to be impossible due to the strained relations between the
employer and employees, the employee is entitled to separation pay.14

The purpose of the Labor Code of the Philippines is evident in the foregoing
jurisprudence fostering the protection of employment whilst ensuring the elimination of unfair
treatment and exploitation. These jurisprudence are the implications that employees especially
the poor are not in any way prejudiced by the dispute settlement laid down by labor tribunals.
Though considered as being the most prejudicial in the labor market, the employees are given the
utmost consideration especially those who are proven to be deprived of his claims and benefits as
an employee. The resolution of cases grants the employee what is due to him reckoning from the
time of the deprivation of such employment. With these monetary claims granted to the
employees, it can be inferred that it is in consonance with the aim of the government in
recognizing the right of labor to its just share in the fruits of production of the undertaking.

Further, the 2020 Performance Report of National Labor Relations Commission presents
that settlement of disputes through the Conciliation-Mediation under SEnA benefitted 13,514
workers while through the mandatory conference under the Compulsory Arbitration, 11,725
workers are benefitted. It also presented that at the Regional Arbitration Branches, 61% of the
total cases were disposed of in favor of workers while 39% in favor of employers. On appealed
cases to the Commission, 74% is in favor of workers while 26% to that of the employers.15

The inquiry to be resolved is the question whether the laid down dispute settlement is
favorable to the part of employers. Upon analyzing the foregoing reports, jurisprudence and the
present dispute settlement laid down by labor tribunals, it may infer that there is no impartiality
relative to the benefit towards the employers. Employers are also given the opportunity to be
heard, present their documentary evidence and other pertinent documents. In fact, they are more
privilege than the employees especially during the proceedings as they are assisted with well-
founded and experienced legal counsels because of their ability to afford one. The burden of
proof lies to employers, hence they can prove their claims. The reason of not winning their case
is not because of impartiality rather their inability to establish their counter-claims.

According to the side of a lawyer from Butuan, whom I have interviewed, had
represented an employee who was illegally terminated and have not received night shift
differentials. The Labor Arbiter decided in favor of the employee which was granted monetary
benefits and the separation pay as it is no longer feasible to reinstate the employee in view of
their strange relationship. He added that the decision of the Labor tribunal was both beneficial to
parties, and the employer, likewise learned his obligation and the employee knew his right. I
have also asked an employer who have experienced dispute settlement adjudicated by the Labor
Arbiter. The decision was favorable to the employer. The employee filed a complaint for illegal
dismissal. The contention of the employer was that the employee was legally dismissed because
he was caught stealing company’s property. The employer was given the chance to prove the
legality of his action and presented evidence to prove the act committed by the employee. His
view on the effectiveness of dispute settlement laid down by DOLE is that it is favorable to both
parties as even employers are given the chance to be heard. On his part, he was able to present
clear and convincing evidence to warrant the company’s side.

13
Pulta, 2020. CA Rules Against BPO in Labor Case. Philippine New Agency.
14
G.R No. 207354. January 10, 2018.
15
National Labor Relations Performance Report 2020.
 V. Conclusion

Effectuating peace and order at the workplace through labor dispute settlement is an
essential step in the search for industrial peace. With regard to the issue under consideration, the
present dispute settlement involving employer-employee relationship as laid down by DOLE,
NLRC and other related agencies is beneficial to both parties. This impartiality is founded on the
principles enshrined in Article 13 of the 1987 Philippine Constitution. The government through
the Department of Labor and Employment continuously implement its mandate to protect the
labor industry in the country. The existence of disputes between employee and employer is
mainly because of their diverse interest. The inability to resolve or eliminate such dispute results
to a chaotic workplace. This consequently, affect the labor market which also has its detrimental
repercussions to the economic condition of a country.

The present dispute settlement still needs to be improved in order to efficiently and
equitably dispense justice in labor perspective. The Department of Labor and Employment
should strengthen the existing Labor Education Program which shall be accessible to workers,
employers and other stakes of the labor realm. The insufficiency of knowledge relative to labor
standards and labor relations is the main cause of the unestablished claims relative to the
violations or the misconduct of the employer and employee which will result to the emergence of
new issue which is the root of their dispute. Another matter to be focused by the Department is
the effectiveness of the mediator or arbitrator in dealing their assigned cases. Lack of
competency on mediation proceedings may defeat the very purpose of the preferred mode of
settlement.

Moreover, in this time of pandemic, the Department shall establish its measures to
address the employer-employer relationship due to the economic distortions brought by the
pandemic. Considering that in early 2020, numerous employees are laid off, demoted, deprived
of monetary claims and benefits and worst, terminated due to temporary or permanent closures
of the establishments, the Department needs to efficiently exercise its mandate to settle labor
disputes in order to continue the protection of full employment and in order for them to have a
decent condition of life. This can be done through the institution of systematic measures and
approach to constantly provide workers and employers on access to justice in labor realm.

Hence, to avoid a negative domino effect of the disruption of relations between workers
and employers down to the economic status of the country, these technical and substantial
procedure employed in the present dispute settlements shall strictly be complied, with the
paramount consideration of the welfare of labor and at the same time upholding the right of
employers. Industrial peace, where contentment of labor and management subsists, shall be
attained through the collaborative efforts of the government and its people, particularly the
stakeholders in the labor industry. If respect, trust and confidence will foster in the workplace,
then dispute is alien thereof. In a world of diverse culture and practices, mutual understanding
and social responsibility should endure in order to effectively adapt the global market trends.