LABOR LAW | BAR 2021 | LAST MINUTE REV
8042, Rule
II. RECRUITMENT AND PLACEMENT
A. Definition - recruitment and placement shall mean:
1) [CETCHUP] any act of canvassing, enlisting,
transporting, contracting, hiring, utilizing, or procuring
workers
2) [RCPA] and includes referring, contract services,
promising or advertising
 the act of referral is the act of passing along or
forwarding of an applicant for employment after
an initial interview of a selected applicant for
employment to a selected employer, placement
officer or bureau
3) for employment abroad, whether for profit or not,
4) Provided: any person or entity which, in any manner,
offers or promises for a fee, employment to two or
more persons shall be deemed engaged in
recruitment and placement.
Selective Deployment
The State shall deploy overseas Filipino workers only in
countries where the rights of Filipino migrant workers are
protected.
The government recognizes any of the following as a
guarantee on the part of the receiving country for the
protection and the rights of overseas Filipino workers:
a) It has existing labor and social laws protecting the
rights of migrant workers;
b) It is a signatory to multilateral conventions,
declarations or resolutions relating to the protection of
migrant workers;
c) It has concluded a bilateral agreement or arrangement
with the government protecting the rights of overseas
Filipino workers; and
d) It is taking positive, concrete measures to protect the
rights of migrant workers.
In the absence of a clear showing that any of the
aforementioned guarantees exists in the country of
destination of the migrant workers, no permit of
deployment shall be issued by the POEA.
NOTE: overseas seafarers are always contractual
employees; whereas domestic seafarers may be permanent.
B. Regulation of recruitment and placement activities
1. Regulatory authorities
Local employment is now assigned to the Bureau of Labor
Relations, while overseas employment, whether land-based
or sea-based, is assigned to the Philippine Overseas
Employment Administration (POEA).
a) POEA
Original and exclusive jurisdiction to hear and decide:
a) All cases, which are administrative in character,
involving or arising out of violations of rules and
regulations relating to licensing and registration of
recruitment and employment agencies or entities
b) Disciplinary action cases and other special cases,
which are administrative in character, involving
employers, principals, contracting partners and
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Filipino migrant workers (IRR of R.A. no.
X, Sec. 6)
Note: Sec 10 of RA 8042 provides that claims of OFWs fall
within the jurisdiction of the Labor Arbiter of the NLRC.
Decisions of the POEA are appealable to the DOLE
Secretary
c) Regulatory and visitorial powers of DOLE
Regulatory & Rule-Making Powers
The Secretary of Labor shall have the power to restrict and
regulate the recruitment and placement activities of all
agencies within the coverage of this Title and is hereby
authorized to issue orders and promulgate rules and
regulations to carry out the objectives and implement the
provisions of this Title. (Labor Code, Art. 36)
Visitorial Powers
The Secretary of Labor or his duly authorized
representatives may, at any time, inspect the premises,
books of accounts and records of any person or entity
covered by this Title, require it to submit reports regularly
on prescribed forms, and act on violations of any provisions
of this Title. (Labor Code, Art. 37)
Note: Art 38 of the Labor Code, empowering the Secretary
to issue warrants of arrest, was declared unconstitutional by
the Supreme Court in the case of Salazar vs Achacoso.
2. Ban on Direct Hiring
No employer may hire a Filipino worker for overseas
employment except through the Boards and entities
authorized by the Secretary of Labor.
Direct-hiring by:
a) members of the diplomatic corps,
b) international organizations; and
c) such other employers as may be allowed by the
Secretary of Labor is exempted from this provision.
(ART. 18, Labor Code)
d) Added exemption: name hirees
o Name hirees refers to individual workers who are
able to secure contracts for overseas employment
on their own efforts and representation without
the assistance or participation of any recruitment
agency.
o Name hirees should register with the POEA.
3. Entities prohibited from recruiting
Qualifications
The applicant for a license to operate a private employment
agency, whether for local or overseas employment must
possess the following:
a) Filipino citizens for single proprietorship and seventy
five percent (75%) of the authorized and voting capital
stock is owned and controlled by Filipino citizens for
partnership and corporation;
b) For local employment: minimum net worth of
P1,000,000.00 in case of single proprietorship and a
minimum paid up capital of P1,000,000.00 in case of
partnership and corporation

c) For overseas employment: minimum net worth of
P5,000,000.00 in case of single proprietorship and a
minimum paid up capital of P5,000,000.00 in case of
partnership and corporation; and
d) Not otherwise disqualified by law or other government
rules and regulations to engage in the business of
recruitment and placement of workers for local
employment.
Disqualification
The following are not qualified to engage in the business of
recruitment and placement for local employment:
1) Those who are convicted of illegal recruitment,
trafficking in persons, anti-child labor violation, or
crimes involving moral turpitude;
2) Those against whom probable cause or prima facie
finding of guilt for illegal recruitment or other related
cases exist particularly to owners or directors of
agencies who have committed illegal recruitment or
other related cases.
3) Those agencies whose licenses have been previously
revoked or cancelled by the Department under Sec. 54
of these rules.
4) Cooperatives whether registered or not under the
Cooperative Act of the Philippines.
5) Law enforcers and any official and employee of the
Department of Labor and Employment (DOLE).
6) Sole proprietors of duly licensed agencies are
prohibited from securing another license to engage in
recruitment and placement.
7) Sole proprietors, partnerships or corporations licensed
to engage in private recruitment and placement for
local employment are prohibited from engaging in job
contracting or sub contracting activities.
Entities disqualified from Engaging or Participating in
the Business of Recruitment and Placement of Workers
for Overseas Employment
1) Travel agencies and sales agencies of airline
companies, whether for profit or not. (Art. 26)
2) Officers or members of the Board of any corporation
or partners in a partnership engaged in the business of
a travel agency;
3) Corporations and partnerships, where any of its
officers, members of the board or partners is also an
officer, member of the board or partner of a
corporation or partnership engaged in the business of a
travel agency;
4) Individuals, partners, officers, or directors of an
insurance company who make, propose or provide an
insurance contract under the compulsory insurance
coverage for agency-hired OFWs;
5) Sole proprietors, partners or officers and members of
the board with derogatory records, such as, but not
limited to the ff:
a. Those convicted or against whom probable
cause or prima facie finding of guilt is
determined by a competent authority for
illegal recruitment or for other related
crimes or offenses committed in the course
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of, related to, or resulting from, illegal
recruitment, or for crimes involving moral
turpitude;
b. Those agencies whose licenses have been
revoked for violation of RA 8042, PD 442,
RA 9208, and their IRRs;
c. Those agencies whose licenses have been
cancelled, or those who, pursuant to the
order of the Administrator, were included in
the list of persons with derogatory record for
violation of recruitment laws and
regulations;
6) Any official employee of the DOLE, POEA, OWWA,
DFA, DOJ, DOH, BI, IC, NLRC, TESDA, CFO, NBI,
PNP, Civil Aviation Authority of the Philippines,
international airport authorities, and other government
agencies directly involved in the implementation of
RA 8042, as amended, and/or any of his/her relatives
within the fourth civil degree of consanguinity or
affinity.
NOTE: Article 29. Non-transferability of license or
authority. No license or authority shall be used directly or
indirectly by any person other than the one in whose favor
it was issued or at any place other than that stated in the
license or authority be transferred, conveyed or assigned to
any other person or entity. Any transfer of business address,
appointment or designation of any agent or representative
including the establishment of additional offices anywhere
shall be subject to the prior approval of the Department of
Labor.
4. Suspension or cancellation of license or authority
Section 51. Classification of offenses. – Administrative
offenses are classified into serious, less serious and light,
depending on the gravity. The Regional Director, after
observance of due process, shall impose the appropriate
administrative penalties in very recruitment violation.
a. The following are considered serious offenses with the
penalty of cancellation of license/authority:
1) Recruitment and placement of workers in violation of
anti-child labor laws.
2) Engaging in acts of misrepresentation for the purpose
of securing a license or renewal thereof.
3) Engaging in the recruitment or placement of workers
in jobs harmful to public health or morality or to the
dignity of the Republic of the Philippines.
4) Transferring, conveying or assigning the
license/authority to any person or entity other than the
one in whose favor it was issued.
5) Charging or accepting directly or indirectly any
amount form the worker.
6) Continuous operation despite suspended license or
authority.
7) Conviction for violation of any of the provisions of
Republic Act No. 9208, known as the Anti-
Trafficking in Persons Act of 2003, or Republic Act
No. 7610, as amended by Republic Act No. 9231 and
the Implementing Rules and Regulations.
8) Obstructing or attempting to obstruct inspection by the
Secretary, the Regional Director or their duly
authorized representatives.
9) Substituting or altering to the prejudice of the worker,
employment contracts to be approved by the Regional
Office form 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 Regional
Office.
10) Inducing or attempting to induce an already employed
worker to transfer from or leave his employment for
another unless the transfer is designed to liberate a
worker from oppressive terms and conditions of
employment.
11) Influencing or attempting to influence any person or
entity not to employ any worker who has not applied
for employment through his agency.
b. The following are less serious offenses with their
corresponding penalties:
 First Offense – Suspension of license for two (2)
months to six (6) months
 Second Offense – Suspension of license for six (6)
months to one (1) year Third Offense – Cancellation
of License
1) Engaging in acts of misrepresentation in connection
with recruitment and placement of workers.
2) Engaging in recruitment activities in places other than
that specified in the license without previous
authorization from the Department.
3) Appointing or designating agents, representatives or
employees without prior approval of the Department.
4) Failure to comply with the undertaking to provide Pre-
Employment Orientation (PEO) to workers.
5) Coercing workers to accept prejudicial arrangements
in exchange for certain benefits that rightfully belong
to the workers.
6) Disregard of orders, notices and other legal processes
issued by the Department.
7) Failure to submit within the prescribed period the
required reports related to local recruitment and
placement.
8) Violation of other pertinent provisions of the Code and
other relevant laws, rules and regulations, guidelines
and issuances on recruitment and placement of
workers for local employment and the protection of
their welfare, including the filing or renewal of license
or authority beyond the prescribed period.
Section 52. Fines. – The Regional Director shall have the
power to impose a fine of ten thousand (P10,000.00) Pesos
for every count of offense committed in addition to the
penalty of suspension of license.
Section 53. Penalty for cases involving five or more
complainants. – A respondent found guilty of committing
an offense regardless of the number or nature of charges,
against five or more complainants in a single case shall be
imposed the penalty of cancellation of license.
5. Prohibited Practices and Illegal Recruitment
Two kinds of illegal recruitment:
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1) Illegal Recruitment by Non-Licensee/Non-Holder of
Authority - any recruitment activity, done either for
local or overseas employment, whether for profit or
not, by any individual or entity without the required
license or authority.
 Non-Licensee / Non-Holder of authority is any
person, corporation or entity which has not been
issued a valid license or authority to engage in
recruitment and placement by the Secretary of
Labor, or whose license or authority has been
suspended, revoked or cancelled by the POEA or
the Secretary.
2) Illegal recruitment by any person, whether licensee or
not through the commission of the following:
For local employment: OFMI-IHOC
1) [Overcharging] To charge or accept directly or
indirectly any amount greater than that specified
in the schedule of allowable fees prescribed by
the Secretary of Labor and Employment, or to
make a worker pay or acknowledge any amount
greater than that actually received by him as a
loan or advance;
2) [False Notice] To furnish or publish any false
notice or information or document in relation to
recruitment or employment;
3) [Misrepresentation to Secure License] To give
any false notice, testimony, information or
document or commit any act of misrepresentation
for the purpose of securing a license or authority
under the Labor Code, or for the purpose of
documenting hired workers with the POEA,
which include the act of reprocessing workers
through a job order that pertains to nonexistent
work, work different from the actual overseas
work, or work with a different employer whether
registered or not with the POEA;
4) [Inducing Worker to Quit] To include or
attempt to induce a worker already employed to
quit his employment in order to offer him another
unless the transfer is designed to liberate a
worker from oppressive terms and conditions of
employment;
5) [Inducement not to employ] To influence or
attempt to influence any person or entity not to
employ any worker who has not applied for
employment through his agency or who has
formed, joined or supported, or has contacted or
is supported by any union or workers'
organization;
6) [Recruitment for Harmful Jobs] To engage in
the recruitment or placement of workers in jobs
harmful to public health or morality or to the
dignity of the Republic of the Philippines;
7) [Obstructing Inspection] To obstruct or attempt
to obstruct inspection by the Secretary or by
his/her duly authorized representatives;
8) [Contract Substitution] To substitute or alter 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;
For overseas employment: the same eight acts listed above
PLUS: MIND-FFNELL-MIST
9) [Misrepresentation in Documentation] To fail
to submit reports on the status of employment,
placement vacancies, remittance of foreign
exchange earnings, separation from jobs,
departures and such other matters or information
as may be required by the Secretary of Labor and
Employment;
10) [Nonsubmission of Reports] To fail to submit
reports on the status of employment, placement
vacancies, remittance of foreign exchange
earnings, separation from jobs, departures and
such other matters or information as may be
required by the Secretary of Labor and
Employment;
11) [Involvement in Travel/Insurance Agency] For
an officer or agent of a recruitment or placement
agency to become an officer or member of the
Board of any corporation engaged in travel
agency or insurance or to be engaged directly or
indirectly in the management of travel or
insurance agency;
12) [Withholding of Documents] To withhold or
deny travel documents from applicant workers
before departure for monetary or financial
considerations, or for any other reasons, other
than those authorized under the Labor Code and
its implementing rules and regulations;
13) [Failure to Deploy] Failure to actually deploy a
contracted worker without valid reason as
determined by the Department of Labor and
Employment;
14) [Failure to Reimburse] Failure to reimburse
expenses incurred by the worker in connection
with his documentation and processing for
purposes of deployment, in cases where the
deployment does not actually take place without
the worker's fault. Illegal recruitment when
committed by a syndicate or in large scale shall
be considered an offense involving economic
sabotage;
15) [Non-Filipino Manager] To allow a non-Filipino
citizen to head or manage a licensed
recruitment/manning agency;
16) [Excessive Interest] Grant a loan to an overseas
Filipino worker with interest exceeding eight
percent (8%) per annum, which will be used for
payment of legal and allowable placement fees
and make the migrant worker issue, either
personally or through a guarantor or
accommodation party, postdated checks in
relation to the said loan;
17) [Specifying Loan Entity] Impose a compulsory
and exclusive arrangement whereby an overseas
Filipino worker is required to avail of a loan only
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from specifically designated institutions, entities
or persons;
18) [Non-renegotiation of a loan] Refuse to
condone or renegotiate a loan incurred by an
overseas Filipino worker after the latter's
employment contract has been prematurely
terminated through no fault of his or her own;
19) [Specifying a Medical Entity] Impose a
compulsory and exclusive arrangement whereby
an overseas Filipino worker is required to
undergo health examinations only from
specifically designated medical clinics,
institutions, entities or persons, except in the case
of a seafarer whose medical examination cost is
shouldered by the principal/shipowner;
20) [Specifying a Training Entity] Impose a
compulsory and exclusive arrangement whereby
an overseas Filipino worker is required to
undergo training, seminar, instruction or
schooling of any kind only from specifically
designated institutions, entities or persons, except
fpr recommendatory trainings mandated by
principals/shipowners where the latter shoulder
the cost of such trainings;
21) [Violation of Suspension] For a suspended
recruitment/manning agency to engage in any
kind of recruitment activity including the
processing of pending workers' applications; and 
22) [Collection of Insurance Premiums] For a
recruitment/manning agency or a foreign
principal/employer to pass on the overseas
Filipino worker or deduct from his or her salary
the payment of the cost of insurance fees,
premium or other insurance related charges, as
provided under the compulsory worker's
insurance coverage.
The persons criminally liable for the above offenses are the
principals, accomplices and accessories. In case of juridical
persons, the officers having control, management or
direction of their business shall be liable.
An employee of a company or corporation engaged in
illegal recruitment may be held liable as principal, together
with his employer, if it is shown that he actively and
consciously participated in illegal recruitment.
The culpability of the employee therefore hinges on his
knowledge of the offense and his active participation in its
commission. Where it is shown that the employee was
merely acting under the direction of his superiors and was
unaware that his acts constituted a crime, he may not be
held criminally liable for an act done for and in behalf of
his employer.
NOTE: the POEA Rules and Regulations requires prior
approval of the appointment of representatives or agents.
Recruitment activities of agents or representatives
unauthorized by the POEA likewise constitute illegal
recruitment.
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Types:
Simple illegal recruitment - Illegal recruitment committed
by a person who is neither a licensee nor a holder of
authority;
Economic sabotage
a) By a syndicate - if carried out by a group of three (3)
or more persons conspiring or confederating with one
another.
b) In large scale - if committed against three (3) or more
persons individually or as a group.
o A conviction hereunder must be based on a
finding of illegal recruitment of 3 or more
persons having been recruited. Thus, there can be
no illegal recruitment in large scale
Where illegal recruitment is proved but the elements of
“large scale” or “syndicate” are absent, the accused can be
convicted only of “simple illegal recruitment”.
Venue of Criminal Action
The complainant, may, at his option, file at the RTC of the
province or city:
1. Where the offense was committed; or
2. Where the offended party resides at the time of
the commission of the offense (R.A. No. 8042,
Sec. 9)
D. Liability of local recruitment agency and foreign
employer
1. Solidary liability (Section 10, RA 8042)
The liability of the principal/employer and the
recruitment/placement agency for any and all claims arising
out of the implementation of the employment contract
involving Filipino workers for overseas deployment shall
be joint and several.
 This provision shall be incorporated in the
contract for overseas employment and shall be a
condition precedent for its approval.
 The performance bond to be filed by the
recruitment/placement agency, as provided by
law, shall be answerable for all monetary claims
or damages that may be awarded to the workers.
If the recruitment/placement agency is a juridical
being, the corporate officers and directors and
partners as the case may be, shall themselves be
jointly and solidarily liable with the corporation
or partnership for the aforesaid claims and
damages.
 Such liabilities shall continue during the entire
period or duration of the employment contract
and shall not be affected by any substitution,
amendment or modification made locally or in a
foreign country of the said contract.

Prescriptive Period Rationale for the solidary liability:

SIMPLE ECONOMIC  to protect labor and alleviate workers' plight;
SABOTAGE  In overseas employment, the filing of money
Within 5 years from time Within 20 years from the claims against the foreign employer is attended
the illegal recruitment time the illegal recruitment by practical and legal complications. The distance
happened happened of the foreign employer alone makes it difficult
for an overseas worker to reach it and make it
When maximum penalty is imposed: liable for violations of the Labor Code.
 If the person illegally recruited is less than 18  There are also possible conflict of laws,
years of age; or jurisdictional issues, and procedural rules that
 If committed by a non-licensee or non- holder of may be raised to frustrate an overseas worker’s
authority attempt to advance his or her claims. (Sameer vs
Cabiles, LEONEN)
Illegal Recruitment distinguished from Estafa
Illegal recruitment and estafa cases may be filed 2. Theory of imputed knowledge
simultaneously and separately. They are entirely different The relationship of the local recruitment agency/local
offenses and neither one is included or necessarily includes manning agency vis-à-vis its foreign principal is that of
the other. agent-principal, respectively. Consequently, the theory of
imputed knowledge ascribes the knowledge of the agent to
the principal.
Illegal Recruitment Estafa by Deceit NOTE: the theory, however, does not work the other way
Malum prohibitum Mala in se around. The knowledge of the principal-foreign employer
Criminal intent not Criminal intent necessary cannot be imputed to its agent. Thus, Sunace vs NLRC:
necessart  Sunance deployed Divina to Taiwan as a domestic helper
Deceit not essential Elements of deceit and under a 12 month contract. After the expiration of the said
damage indispensable contract, Divina continued working for her Taiwanese
employer for two more years. Upon returning to the
Philippines, Divina filed a complaint against Sunance et al
Thus, not all acts which constitute estafa necessarily alleging that she was jailed for three months and was
establish the crime of illegal recruitment. Estafa is wider underpaid. Sunance claimed that it cannot be held liable for
in scope and covers deceits, whether related or not to the Divina’s claims because the 2 year extension of Divina was
recruitment activities. not made with its consent and knowledge.

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 SC ruled that Sunance could not be made liable. There being Code shall submit a list of such nationals to the Secretary
no substantial proof that Sunace knew of and consented to be of Labor within thirty (30) days after such date indicating
bound under the 2-year employment contract extension, it their names, citizenship, foreign and local addresses,
cannot be said to be privy thereto. As such, it and its "owner" nature of employment and status of stay in the country.
cannot be held solidarily liable for any of Divina’s claims
arising from the 2-year employment extension.
The Secretary of Labor shall then determine if they are
 Furthermore, as Sunace correctly points out, there was an entitled to an employment permit.
implied revocation of its agency relationship with its foreign
principal when, after the termination of the original Considering that McBurnie, an Australian, alleged illegal
employment contract, the foreign principal directly dismissal and sought to claim under our labor laws, it was
negotiated with Divina and entered into a new and separate necessary for him to establish that he was qualified and
employment contract in Taiwan. duly authorized to obtain employment within our
 Article 1924 of the New Civil Code states that the agency is jurisdiction. His failure to obtain an employment permit, by
revoked if the principal directly manages the business itself, necessitates the dismissal of his labor complaint.
entrusted to the agent, dealing directly with third persons.
(McBurnie v. Ganzon, G.R. Nos. 178034, 178117 &
E. Termination of Contract of Migrant Worker 186984-85 (Resolution), October 17, 2013)
Section 10, RA 8042: In case of termination of overseas
employment without just, valid or authorized cause as
defined by law or contract, the worker shall be entitled to:
a) the full reimbursement of his placement fee with
interest at twelve percent (12%) per annum,
b) plus his salaries for the unexpired portion of his
employment contract.
c) Plus cost of repatriation and transport of belongings;
and
d) Damages.

Jurisdiction for illegal dismissal: Labor Arbiter

F. Employment of non-resident aliens

ART. 40. Employment Permit of Non-resident Aliens. -
Any alien seeking admission to the Philippines for
employment purposes and any domestic or foreign
employer who desires to engage an alien for employment in
the Philippines shall obtain an employment permit from the
Department of Labor.

The employment permit may be issued to a non- resident

alien or to the applicant employer after a determination of
the non-availability of a person in the Philippines who is
competent, able and willing at the time of application to
perform the services for which the alien is desired.

For an enterprise registered in preferred areas of

investments, said employment permit may be issued upon
recommendation of the government agency charged with
the supervision of said registered enterprise.

ART. 41. Prohibition Against Transfer of Employment.

(a) After the issuance of an employment permit, the alien
shall not transfer to another job or change his
employer without prior approval of the Secretary of
Labor.
(b) Any non-resident alien who shall take up employment
in violation of the provision of this Title and its
implementing rules and regulations shall be punished
in accordance with the provisions of Articles 289 and
290 of the Labor Code.
(c) In addition, the alien worker shall be subject to
deportation after service of his sentence.

ART. 42. Submission of List. Any employer employing

non-resident foreign nationals on the effective date of this

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 III. LABOR STANDARDS
- sets out the minimum terms, conditions, and
benefits of employment that employers must
provide or comply with and to which employees
are entitled as a matter of legal right.
A. CONDITIONS OF EMPLOYMENT
ART. 82. COVERAGE. – GoMAFiFADoSeRe
The provisions of this Title* shall apply to employees in all
establishments and undertakings whether for profit or not,
but not to:
1. government employees;
o however, employees of GOCCs without original
charters, or those incorporated under the
Corporation Code, are included.
2. managerial employees;
o "managerial employees" refer to those whose
primary duty consists of the management of the
establishment in which they are employed or of a
department or subdivision thereof, and to other
officers or members of the managerial staff.
o “members of the managerial staff” - they perform
the following duties and responsibilities:
a) The primary duty consists of the
performance of work directly related to
management policies of their employer;
b) Customarily and regularly exercise
discretion and independent judgment; and
c) (i) Regularly and directly assist a proprietor
or a managerial employee whose primary
duty consists of the management of the
establishment in which he is employed or
subdivision thereof; 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) Who do not devote more than 20 percent of
their hours worked in a work week to
activities which are not directly and closely
related to the performance of the work
described in paragraphs (1), (2) and (3)
above.
3. field personnel;
o "Field personnel" shall refer to non-agricultural
employees who:
a) regularly perform their duties away from the
principal place of business or branch office
of the employer; and
b) whose actual hours of work in the field
cannot be determined with reasonable
certainty.
4. members of the family of the employer who are
dependent on him for support;
5. domestic helpers;
o any person, whether male or female, who renders
services in and about the employer’s home and
which services are usually necessary or desirable
for the maintenance and enjoyment thereof, and
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ministers exclusively to the personal comfort and
enjoyment of the employer’s family.
o The definition does not cover include househelp
or laundry women working in staffhouses of a
company.
6. persons in the personal service of another; and
7. workers who are paid by results as determined by
the Secretary of Labor in appropriate regulations.
o including those who are paid on piece-work,
"takay," "pakiao" or task basis, and other non-
time work if their output rates are in accordance
with the standards prescribed under Section 8,
Rule VII, Book Three of these regulations, or
where such rates have been fixed by the Secretary
of Labor and Employment in accordance with the
aforesaid Section.
o David v. Macasio (benefits entitled to pakyaw
basis workers):
The payment of an employee on task or pakyaw
basis alone is insufficient to exclude one from the
coverage of SIL and holiday pay. They are
exempted from the coverage of Title I (including
the holiday and SIL pay) only if they qualify as
"field personnel.”
o Entitled to SIL, Holiday Pay. NOT entiled to 13th
month.
NOTE additional exclusion for certain benefits:
 For retail and service establishments regularly
employing less than 10 workers (9 workers or less):
employees therein are not entitled to SIL and holiday
pay
 For retail and service establishments regularly
employing not more than 5 workers (5 workers or
less): employees therein are not entitled to NSD
Title – Book Three, Title I
 Book Three has three titles. The exclusion provided in
Art 82 refers only to the 15 articles under Title I.
 15 articles = hours of work and eight statutory
employment benefits, to wit:
1) Overtime pay;
2) Meal break;
3) Night shift differential;
4) Rest day;
5) Additional pay for working on rest days or
special holiday;
6) Holiday pay;
7) SIL; and
8) Share in service charges.
1. HOURS OF WORK technicians, psychologists, midwives, attendants and all
a. Principles in determining hours worked other hospital or clinic personnel.
ART. 84. HOURS WORKED.
Hours worked shall include ii. Night shift differential – 10pm – 6am: 10% of regular
a) all time during which an employee is required to be on rate or overtime rate or premium pay rate, as the case may
duty or to be at a prescribed workplace; and be (basta last icompute ang NSD)
b) all time during which an employee is suffered or  Note again specific exclusion in addition to those
permitted to work. enumerated under Art 82: “those of retail and
service establishments regularly employing not
Rest periods of short duration during working hours shall more than five (5) workers”
be counted as hours worked.
iii. Overtime work – 25% of regular wage if regular day or
IRR, SECTION 4. Principles in determining hours 30% of premium pay rate if holiday/rest day/special
worked. — The following general principles shall govern holiday, thus:
in determining whether the time spent by an employee is OT on ordinary/regular Plus 25% of the basic
considered hours worked for purposes of this Rule: day hourly rate
a. All hours are hours worked which the employee is OT on rest day/special Plus 30% of 130%
required to give his employer, regardless of whether or holiday
not such hours are spent in productive labor or involve OT on rest day which falls Plus 30% of 150%
physical or mental exertion. on a special holiday
b. An employee need not leave the premises of the work OT on regular holiday Plus 30% of 200%
place in order that his rest period shall not be counted, OT on rest day which falls Plus 30% of 230%
it being enough that he stops working, may rest on a regular holiday
completely and may leave his work place, to go
elsewhere, whether within or outside the premises of  Overtime work – work exceeding 8 hours within the
his work place. worker’s 24 hour workday
c. If the work performed was necessary, or it benefited  In computing for OT pay, ECOLA is EXCLUDED but
the employer, or the employee could not abandon his value of FACILITIES is INCLUDED, ie., the basis of
work at the end of his normal working hours because overtime compensation should be the total daily wage
he had no replacement, all time spent for such work for 8 hrs’ work and not only the cash portion of the
shall be considered as hours worked, if the work was wage.
with the knowledge of his employer or immediate - Eg, cash wage = P3.20 with 2 meals furnished as
supervisor. facilities at P0.40 each. This makes the total daily
d. The time during which an employee is inactive by wage of P4.00 which should be the basis of OT
reason of interruptions in his work beyond his control pay.
shall be considered working time either if the  If employee is paid on a monthly basis, to determine
imminence of the resumption of work requires the daily wage, use this formula: (monthly wage x
employee's presence at the place of work or if the 12)/total number of days considered paid in a year
interval is too brief to be utilized effectively and Days Worked 5- 5.5 6
gainfully in the employee's own interest. day
W
b. Compensable time W
246 Ordinary Workdays 246 246 246
i. Normal hours of work 52 Saturdays 0 26 52
ART. 83. NORMAL HOURS OF WORK. The normal 52 Sundays 0 0 0
hours of work of any employee shall not exceed eight (8) 12 Regular Holidays 12 12 12
hours a day. 3 Special Holidays 0 0 0
365 Divisor or Multiplier 258 284 310
Health personnel in cities and municipalities with a
population of at least one million (1,000,000) or in  Undertime work on any particular day shall not be
hospitals and clinics with a bed capacity of at least one offset by overtime work on any other day.
hundred (100) shall hold regular office hours for eight (8) - The prohibition refers to a situation where the
hours a day, for five (5) days a week, exclusive of time for undertime and OT are on different days
meals, except where the exigencies of the service require - If it’s on the same day, there is no prohibition.
that such personnel work for six (6) days or forty-eight (48) Eg, normal work sched is 8am-5pm. Employee
hours, in which case, they shall be entitled to an additional late, went to work at 9am but also stayed late, eg
compensation of at least thirty percent (30%) of their til 5pm. There’s no undertime / OT to speak of
regular wage for work on the sixth day. For purposes of this because the total number of hours worked is still
Article, "health personnel" shall include resident 8am. OT refers to pay in excess of 8hrs.
physicians, nurses, nutritionists, dieticians, pharmacists, - Permission given to the employee to go on leave
social workers, laboratory technicians, paramedical on some other day of the week shall not exempt

9
 the employer from paying the additional
compensation required in this Chapter (Art 88)
ART. 89. Emergency Overtime Work. Any employee
may be required by the employer to perform overtime work
in any of the following cases: LAUF-WELC
a. When the work is necessary to prevent Loss or
damage to perishable goods;
b. When it is necessary to prevent loss of life or property
or in case of imminent danger to public safety due to
an Actual or impending emergency in the locality
caused by serious accidents, fire, flood, typhoon,
earthquake, epidemic, or other disaster or calamity;
c. When there is Urgent work to be performed on
machines, installations, or equipment, in order to
avoid serious loss or damage to the employer or some
other cause of similar nature;
d. When overtime work is necessary to avail of
Favorable weather or environmental conditions where
performance or quality of work is dependent thereon.
e. When the country is at War or when any other
national or local Emergency has been declared by the
National Assembly or the Chief Executive;
f. Where the Completion or continuation of the work
started before the eighth hour is necessary to prevent
serious obstruction or prejudice to the business or
operations of the employer.
When an employee refuses to render emergency overtime
work under any of the foregoing conditions, he may be
dismissed on the ground of insubordination or willful
disobedience of lawful order of the employer.
In cases not falling within any of these enumerated in this
Section, no employee may be made to work beyond eight
hours a day against his will.
(a) Compressed workweek
- Refers to a situation where the normal workweek
is reduced to less than 6 days but the total number
of work hours of 48 hours per week remains. The
normal workday is increased to more than 8 hrs
but not to exceed 12 hrs, w/o corresponding
overtime premium.
- Conditions for validity:
1) The company is suffering from losses or the
CWW is adopted to prevent serious losses
due to causes beyond the company’s control;
2) Express and voluntary agreement of
majority of the covered employees or their
duly authorized representatives;
3) Notification to the DOLE of the adoption of
the CWW scheme;
4) In firms using substances, chemicals, and
processes or operating under conditions
where there are airborne
contaminants/human carcinogens/noise
prolonged exposure which may pose hazards
to health and safety, there must be a
certification from an accredited health and
safety organization or practitioner or from
the firm’s safety committee that work
10
beyond 8 hrs is within the threshold limits or
tolerable levels of exposure
- Effects:
1) Any work performed beyond 12hrs a day or
48hrs a week shall be subject to overtime
pay;
2) Employees are still entitled to meal periods
of not less than 60 minutes;
3) Reversion to the normal 8-hour workday
shall not constitute a diminution of benefits
and the employees must be given prior
notice of such reversion within a reasonable
period.
(b) Built-in overtime
In case the employment contract stipulates that the
compensation includes built-in overtime pay and the
same is duly approved by the Director of Bureau of
Local Employment, the non-payment by the employer
of any overtime work is justified and valid.
***TELECOMMUTING LAW
(NOTE: 2018 law; included in the list of relevant laws
under the Bar syllabus)
Section 3. Telecommuting Defined. - As used in this Act
the term "telecommuting" refers to a work from an
alternative workplace with the use of telecommunications
and/or computer technologies.
Section 4. Telecommuting Program. - An employer in
private sector may offer a telecommuting program to its
employees on a voluntary bases, and upon such terms and
conditions as they may mutually agree upon: Provided,
That such terms and conditions shall not be less than the
minimum labor standards set by law, and shall include
compensable work hours, minimum number of work hours,
overtime, rest days, and entitlement to leave benefits. In all
cases, the employer shall provide the telecommuting
employee with relevant written information in order to
adequately apprise the individual of the terms and
conditions of the telecommuting program, and the
responsibilities of employee.
b. Non-compensable hours; when compensable
i. Meal break
GR: It shall be the duty of every employer to give his
employees not less than sixty (60) minutes time-off for
their regular meals. (Art 85)
 Being time off, it is not compensable hours worked.
 Anything less than 60 minutes will be compensable.
Exception: shortening of meal time to not less than 20
minutes is allowed provided it shall be compensable as
hours worked in the following cases: LAUN-MS
a. Where the work is necessary to prevent serious Loss
of perishable goods.
b. In case of Actual or impending emergencies or there is
Urgent work to be performed on machineries,
equipment or installations to avoid serious loss which
the employer would otherwise suffer; and
c. Where the establishment regularly operates Not less
than sixteen (16) hours a day;
d. Where the work is non-Manual work in nature or does
not involve Strenuous physical exertion;
Rest periods or coffee breaks running from five (5) to
twenty (20) minutes shall be considered as compensable
working time.
Exception to the exception: in cases where the shortening
of meal time to not less than 20 mins is for the purpose of
allowing the employees to leave work earlier than the lapse
of the 8-hour work period, shortened meal period shall not
be compensable hours worked, provided:
1) The employees voluntarily agree in writing to a
shortened meal period and are willing to waive
the overtime pay for such shortened meal period;
2) There should be no diminution of benefits of the
employees which they receive prior to the
effectivity of the shortened meal period;
3) The work of the employees does not involve
strenuous physical exertion and they are provided
with adequate coffee breaks in the morning and
afternoon;
4) The value of the benefits derived by the
employees from the proposed work arrangement
is equal to or commensurate with the
compensation due them for the shortened meal
period and overtime pay;
5) The overtime pay of the employees will become
due and demandable if ever they are permitted or
made to work beyond 4:30 pm;
6) The effectivity of the proposed working time
arrangement shall be for a temporary duration as
determined by the DOLE.
ii. Power interruptions or brownouts
1. Brown-outs of short duration but not exceeding 20
mins shall be treated as worked or compensable hours
whether used productively or not;
2. Brownouts running for more than twenty minutes may
not be treated as hours worked provided that any of
the following conditions are present:
a) The employees can leave their work place or go
elsewhere whether within or without the work
premises; or
b) The employees can use the time effectively for
their own interest.
In each case, the employer may extend the working hours
of his employees outside the regular schedules to
compensate for the loss of productive man-hours without
being liable for overtime pay.
iii. Idle time
The idle time that an employee may spend for resting and
dining which he may leave the spot or place of work though
not the premises of his employer, is not counted as
working time only where the work is broken or is not
continuous.
iv. Travel time
11
Travel from home to work – An employee who travels
from home before his regular workday and returns to his
home at the end of the workday is engaged in ordinary
home-to-work travel which is NOT considered hours
worked, EXCEPT:
a) When called to travel during emergency;
b) When travel is done through a conveyance furnished
by the employer;
c) Travel is done under vexing and dangerous
circumstances;
d) Travel is done under the supervision and control of the
employer.
Travel that is all in the day’s work – Time spent by an
employee in travel from jobsite to jobsite during the
workday, must be counted as hours worked.
 Where an employee is required to report at a meeting
place to receive instructions or to perform other work
there, the travel from the designated place to the
workplace is part of the day’s work.
Travel away from home – Travel that keeps an employee
away from home overnight is travel away from home.
Travel away from home is worktime when it cuts across the
employee’s workday. The time is hours worked not only on
regular working hours but also during the corresponding
hours on non-working days.
v. Commuting time
Employees performing tasks during their commute which
are not merely incidental to the employee’s job, and are
primarily for the benefit of the employer (such as a
company driver performing a carpool service for co-
workers according to an agreement with the company), are
entitled to overtime pay.
vi. Waiting time
(a) Waiting time spent by an employee shall be
considered as working time if waiting is an integral
part of his work or the employee is required or
engaged by the employer to wait.
(b) An employee who is required to remain on call in the
employer's premises or so close thereto that he cannot
use the time effectively and gainfully for his own
purpose shall be considered as working while on call.
An employee who is not required to leave word at his
home or with company officials where he may be
reached is not working while on call.
Others: lectures, meetings, training programs
Attendance at lectures, meetings, training programs, and
other similar activities shall not be counted as working time
if all of the following conditions are met:
a. Attendance is outside of the employee's regular
working hours;
b. Attendance is in fact voluntary; and
c. The employee does not perform any productive work
during such attendance.
Semestral break of teachers is compensable hours worked
for it is a form of interruption beyond their control. Applies
only for regular full-time teachers.(University of
Pangasinan Faculty Union v. Univ. of Pangasinan, G.R.
64821-23, 1993).
2. REST PERIODS
Every employer shall give his employees a rest period of
not less than twenty-four (24) consecutive hours after every
six consecutive normal work days.
GR: The employer shall determine and schedule the
weekly rest day of his employees.
XPNs:
1) Collective bargaining agreement;
2) The preference of the employee as to his weekly day
of rest shall be respected by the employer if the same
is based on religious grounds.
- The employee shall make known his preference
to the employer in writing at least seven (7) days
before the desired effectivity of the initial rest
day so preferred.
XPN to XPN: where, however, the choice of the employee
as to his rest day based on religious grounds will inevitably
result in serious prejudice or obstruction to the operations
of the undertaking and the employer cannot normally be
expected to resort to other remedial measures, the
employer may so schedule the weekly rest day of his
choice for at least two (2) days in a month.
 Note: employer will schedule only 2 days in a month.
The other 2 will be employee’s choice. (hati sila)
Work on Rest Day
SECTION 6. When work on rest day authorized. —
An employer may require any of his employees to work on
his scheduled rest day for the duration of the following
emergencies and exceptional conditions: LAUFAN
a) To prevent serious Loss of perishable goods;
b) In case of Actual or impending emergencies caused by
serious accident, fire, flood, typhoon, earthquake,
epidemic or other disaster or calamity, to prevent loss
of life or property, or in cases of force majeure or
imminent danger to public safety;
c) In case of Urgent work to be performed on
machineries, equipment or installations to avoid
serious loss which the employer would otherwise
suffer;
d) When the work is necessary to avail of Favorable
weather or environmental conditions where
performance or quality of work is dependent thereon.
e) In the event of Abnormal pressure of work due to
special circumstances, where the employer cannot
ordinarily be expected to resort to other measures;
f) Where the Nature of the work is such that the
employees have to work continuously for seven (7)
days in a week or more, as in the case of the crew
members of a vessel to complete a voyage and in other
similar cases; and
No employee shall be required against his will to work on
his scheduled rest day except under circumstances provided
12
in this Section: Provided, However, that where an
employee volunteers to work on his rest day under other
circumstances, he shall express such desire in writing,
subject to the provisions of Section 7 hereof regarding
additional compensation.
ART. 93. Compensation for Rest Day, Sunday or
Holiday Work.
(a) Where an employee is made or permitted to work on his
scheduled rest day, he shall be paid an additional
compensation of at least thirty percent (30%) of his regular
wage. An employee shall be entitled to such additional
compensation for work performed on Sunday only when it
is his established rest day.
(b) When the nature of the work of the employee is such
that he has no regular workdays and no regular rest days
can be scheduled, he shall be paid an additional
compensation of at least thirty percent (30%) of his regular
wage for work performed on Sundays and holidays.
(c) Work performed on any special holiday shall be paid
an additional compensation of at least thirty percent (30%)
of the regular wage of the employee. Where such (special)
holiday work falls on the employee’s scheduled rest day,
he shall be entitled to an additional compensation of at least
fifty per cent (50%) of his regular wage.
(d) Where the collective bargaining agreement or other
applicable employment contract stipulates the payment of a
higher premium pay than that prescribed under this Article,
the employer shall pay such higher rate.
Thus:
Work on rest day 30% of regular rate
Work on rest day falling 50% of regular rate
on special holiday
Work on rest day falling 30% of premium rate
on regular holiday
3. SERVICE CHARGE (RA 11360)
All service charges collected by hotels, restaurants and
similar establishments shall be distributed completely and
equally among the covered employees except managerial
employees.
Note: service charge different from tips
 Tips – not normally part of the salary; given
voluntarily by the customers;
 Service charge – part of the cost of the food, goods, or
services ordered by the customers.
In the event that the minimum wage is increased by law or
wage order, service charges paid to the covered employees
shall not be considered in determining the employer’s
compliance with the increased minimum wage.
To facilitate resolution of any dispute between management
and the employees on the distribution of service charges, a
grievance mechanism shall be established. If no grievance
mechanism is established or if inadequate, the grievance
shall be referred to the regional office of the DOLE which
has jurisdiction over the workplace for conciliation.
B. WAGES
1. DEFINITION, COMPONENTS, AND
EXCLUSIONS
"Wage" paid to any employee shall mean:
1) the remuneration or earnings, however
designated;
2) capable of being expressed in terms of money,
whether fixed or ascertained on a time, task,
piece, or commission basis, or other method of
calculating the same;
3) which is payable by an employer to an employee
under a written or unwritten contract of
employment for work done or to be done, or for
services rendered or to be rendered.
Components
Wage includes the fair and reasonable value, as determined
by the Secretary of Labor and Employment, of board,
lodging, or other facilities customarily furnished by the
employer to the employee.
"Fair and reasonable value" shall not include any profit to
the employer, or to any person affiliated with the employer.
Exclusion
Basic wage does not include:
1) Payments for sick, vacation, and maternity
leaves;
2) Night shift differentials;
3) Regular holiday pay and premiums for work done
on rest days and special holidays;
4) Cost-of-living allowances, profit-sharing
payments, 13th month pay or other monetary
benefits which are not considered as part of or
integrated into the regular salary of the workers.
a. Wage vs salary
Wage – compensation for skilled or unskilled manual labor
Salary – compensation for white collared workers and
denote a higher grade of employment.
Distinction important because under Art 1708 of the Civil
Code, ‘wages’ are not subject to execution, garnishment, or
attachment except for debts related to necessities, while
‘salaries’ are not so exempt.
b. Distinguish: facilities and supplements
Facilities - articles or services for the benefit of the
employee or his family but shall not include tools of the
trade or articles or services primarily for the benefit of the
employer or necessary to the conduct of the employer’s
business.
Supplements – benefits or privileges given to each
employee which constitutes an extra remuneration over and
above his basic or ordinary earning or wage.
13
Distinction important because facilities are wage-deductible
(meaning they form part of the wage) while supplements
are not. This in turn is determinative of whether the
employer complies with the minimum wage law or not.
 The criterion lies not so much on the kind of benefit or
item given, but its purpose.
 Manuel: if it is given for the benefit of the employer, it
is a supplement. If it is for the benefit of the employee
or his family, it is a facility and therefore forms part of
his wage.
 Facilities are items of expense necessary for the
laborer’s and his family’s existence and subsistence,
so that by express provision of law, they form part of
the wage and when furnished by the employer are
deductible therefrom, since if they are not so
furnished, the laborer would spend and pay for them
just the same.
REQUISITES FOR DEDUCTION OF FACILITIES
(Mabeza v NLRC)
1. First, proof must be shown that such facilities are
customarily furnished by the trade;
2. Second, the provision of deductible facilities must be
voluntarily accepted in writing by the employee;
3. Finally, facilities must be charged at fair and
reasonable value.
*As regards meals and snacks, the employer may deduct
from the wages not more than 70% of the value of the
meals and snacks enjoyed by the employees, provided that
such deduction is authorized in writing by the employees.
The remaining 30% of the value has to be subsidized by the
employer.
c. Bonus, 13th month pay
Bonus
Whether or not bonus forms part of wages depends upon
the circumstances and conditions for its payment.
 If it is an additional compensation which the employer
promised and agreed to give without any conditions
imposed for its payment, such as success of business
or greater production or output, then it is part of the
wage.
 But if it is paid only if profits are realized on a certain
amount of productivity achieved, it cannot be
considered part of the wages. Where it is not payable
to all but only to laborers and only when the labor
becomes more efficient or more productive, it is only
an inducement or efficiency, a prize therefor, not a
part of the wage.
General Rule: non-diminution not applicable to bonuses
 Grant is a management prerogative; something given
in addition to what is ordinarily received. Thus, not a
demandable and enforceable obligation
Exception:
a) when it was promised to be given without any
conditions imposed for its payment in which case
it is deemed part of the wages; or
 b) it must have had a fixed amount and had been a
long and regular practice on the part of the
employer.
13th month pay
All employers are required to pay all their rank-and-file
employees a 13th month pay not later than December 24 of
every year, provided they have worked for at least 1
MONTH during a calendar year.
 Whereas a bonus is not a statutory obligation, the 13 th
month pay is required by PD 851, hence, mandatory
 It is an additional income based on wage but is not
part of the wage
13th month pay = 1/12 of the total basic salary earned by an
employee within a calendar year.
 Basic salary = all remunerations or earning paid by
this employer for services rendered
 GR: basic salary does not include allowances and
monetary benefits which are not considered or
integrated as part of the regular or basic salary, such as
the cash equivalent of unused vacation and sick leave
credits, overtime, premium, night differential and
holiday pay, and cost-of-living allowances.
 XPN: if by individual or collective agreement,
company practice or policy, the same are treated as
part of the basic salary of the employees.
*For commissions:
 If paid in addition to the basic salary and in the nature
of a productivity bonus or profit-sharing benefit which
is dependent on and generally tied to the productivity
or capacity for revenue production of a company, it
should not be considered as part of basic salary
 But if the commission paid in addition to the basic
salary has a clear direct or necessary relation to the
amount of work actually done by the employee, it
should be considered as part of basic salary.
 If the employee is paid on a commission basis only, he
is excluded from receiving the 13th month pay benefit.
Time of Payment
Not later than December 24 of each year. An employer,
however, may give to his employees ½ of the required 13th
month pay before the opening of the regular school year
and the other half on before the 24th of December of every
year.
Exempted Employers: GAHSP
The ff. employers are still not covered by P.D. No. 851:
a. The Government and any of its political subdivisions,
including GOCCs, excepts those corporations
operating essentially as private subsidiaries of the
Government;
b. Employers already paying their employees a 13th
month pay or more in a calendar year or its equivalent
at the time of this issuance;
o term "its equivalent" shall include Christmas
bonus, mid-year bonus, cash bonuses and other
14
payments amounting to not less than 1/12 of the
basic salary
o but shall not include cash and stock dividends,
COLA and all other allowances regularly enjoyed
by the employee, as well as non-monetary
benefits.
c. Employers of household helpers and persons in the
personal service of another in relation to such
workers; and
o NOTE, however, that a domestic worker or
kasambahay is now entitled to 13th month pay,
pursuant to RA 10361
d. Employers of those who are paid on purely
commission, boundary, or task basis, and those who
are paid a fixed amount for performing specific work,
irrespective of the time consumed in the performance
thereof,
EXCEPT where the workers are paid on piece-rate
basis in which case the employer shall grant the
required 13th month pay to such workers.
o workers paid on piece-rate basis shall refer to
those who are paid a standard amount for every
piece or unit of work produced that is more or
less regularly replicated, without regard to the
time spent in producing the same. 
Special feature of benefit: 13th month pay shall not be
credited as part of the regular wage of the employees for
purposes of determining overtime and premium pay, fringe
benefits, as well as premium contributions to the State
Insurance Fund, social security, medicare and private
welfare and retirement plans.
d. Holiday pay
Article 94. Right to holiday pay.
Every worker shall be paid his regular daily wage during
regular holidays, except in retail and service establishments
regularly employing less than ten (10) workers;
The employer may require an employee to work on any
holiday but such employee shall be paid a compensation
equivalent to twice his regular rate.
Holiday pay - refers to the payment of the regular daily
wage for any unworked regular holiday. (it’s the 100%
daily wage to be received on a regular holiday even if
unworked)
 Important to remember because in order to be entitled
to holiday pay (the 100%), the employee must be
present or at least on leave of absence with pay on the
day immediately preceding the holiday.
 However, if he works on the holiday itself, his absence
the day prior is immaterial. He will be entitled to
200%.
 Where the day immediately preceding the holiday is a
non-working day in the establishment or the scheduled
rest day of the employee, he shall not be deemed to be
on leave of absence on that day, in which case he shall
be entitled to the holiday pay if he worked on the day
immediately preceding the non- working day or rest
day.
Exclusion: GoMaFiFaDoSeRe + retail and service 7) Labor Day – Monday nearest May 1
establishments regularly employing less than ten (10) 8) Independence Day – Monday nearest June 12
workers 9) National Heroes Day – Last Monday of August
10) Bonifacio Day – Monday nearest
Holiday Pay of Certain Employees November 30
1) Monthly-paid employees – entitled to holiday pay; 11) Christmas Day – December 25
Policy Instructions No 9 declaring that monthly-paid 12) Rizal Day – Monday nearest
workers are presumed to be paid for all days in the December 30
month was declared void as it is an unauthorized
exclusion of monthly paid employees. The Labor Nationwide Special Holidays
Code did not make such distinction. EDSA/People Power February 25
2) Private school teachers – may not be paid for the Revolution
regular holidays during semestral vacations. They Black Saturday April 20
shall however be paid for the regular holidays during
Ninoy Aquino Day Monday nearest August
Christmas vacation.
21
3) Workers paid by results – depends on whether
All Saints Day November 1
supervised or unsupervised
Feast of the Immaculate December 08
 Supervised – entitled to holiday pay
Conception of Mary
o those whose time and performance are
Last Day of the Year December 31
supervised by the employer; there’s an
Subject to Presidential Proclamation
element of control and supervision over the
manner as to how the work is to be Chinese New Year February 5
performed All Soul’s Day November 02
 Unsupervised – not entitled to holiday pay (Art Christmas Eve December 24
82)
O There’s control only over the result When Regular Holiday Falls on a Sunday:
O Pakyaw, takay, and piece-rte workers  The President issues a proclamation in advance for the
belong to this group following year which specifies the dates when all the
4) Seasonal workers – entitled to holiday pay only while holidays should be celebrated or observed.
working during the season  In the absence of a presidential proclamation, RA
5) Seafarers – entitled to holiday pay 9849 states that if the holiday falls on a Sunday, the
holiday will be observed on the Monday that follows.
Permutations: [(Basic wage + COLA) x applicable rate] Other notes:
Regular Holiday  Non-Muslims are entitled to Muslim holiday pay
Unworked 100% during Muslim holidays.
Worked 200% o For Muslim holidays that are observed only
Regular Holiday Falling on Rest Day in particular provinces and cities, muslim
employees working outside such
Unworked 100%
province/city shall be excused from
Worked 230%
reporting for work without diminution of
Double Holiday
salary or wages therefor.
Unworked 200%
 Off-setting of holiday work with work on regular days
Worked 300% is not allowed
Double Holiday Falling on Rest Day  Only the President/Congress can declare a holiday.
Unworked 200% Local executives may declare holidays such as town
Worked 390% fiesta but such day cannot be treated as a holiday
Special Holiday contemplated in the Labor Code. Hence, work
Unworked 0 – no work, no pay performed on the day does not entitle workers to
Worked 130% additional or premium payment.
Special Holiday Falling on Rest Day  The Labor Code has no word on how to treat
Unworked 0 – no work, no pay employee’s pay on bad weather or calamity days. The
Worked 150% policy thereon lies on the sound judgement of the
empoyer.
Regular Holidays
1) New Year’s Day – January 1 2. PRINCIPLES
2) Maundy Thursday – Movable Date a. No work, no pay
3) Good Friday – Movable Date  GR: If there is no work performed by the
4) Eidul Fitr – Movable Date employee, there can be no wage or pay.
5) Eidul Adha – Movable Date  Exception: if the laborer was able, willing, and
6) Araw ng Kagitingan – Monday nearest April 9 ready to work but was prevented by management
(Bataan & or was illegally locked out, suspended, or
Corregidor Day) dismissed.

15

b. Equal pay for equal work
 Persons who work with substantially equal
qualifications, skill, effort and responsibility,
under similar conditions, should be paid similar
salaries.
 If an employer accords employees the same
position and rank the presumption is that these
employees perform equal work.
c. Fair wage for fair work
The age-old rule governing the relation between labor
and capital or management and employee is that a "fair
day's wage for a fair day's labor." It is hardly fair or
just for an employee or laborer to fight or litigate
against his employer on the employer's time.
d. Non-diminution of benefits
Non-diminution rule – any benefit and supplement being
enjoyed by employees cannot be reduced, diminished,
discontinued or eliminated by the employer (Arco Metal
Products v Samahan)
There is diminution of benefits when: PUMC
1) The grant or benefit is founded on a policy (CBA or
contract) or has ripened into a practice over a long
period of time;
O “long period of time” – 2 years sufficient
(Sevilla Trading Co v Semana)
2) The benefit pertains to a monetary benefit or a
privilege with monetary equivalent (Royal Plant
Workers Union v CCBPI);
3) The practice is consistent and deliberate;
O Thus, if granted because of a mistake or error in a
doubtful or difficult question of law, it is not
company practice (Globe Mackay v NLRC)
4) The diminution or discontinuance is done unilaterally
by the employer.
O Thus, employees not prohibited and will be
bound if they enter into agreements with the
employer for reduction of certain benefits
(Insular Hotel Union v Waterfront Hotel)
American Wire & Cable Daily Union v American Wire
General Rule: non-diminution not applicable to bonuses
 Grant is a management prerogative; something given
in addition to what is ordinarily received. Thus, not a
demandable and enforceable obligation
Exception:
c) when it was promised to be given without any
conditions imposed for its payment in which case
it is deemed part of the wages; or
d) it must have had a fixed amount and had been a
long and regular practice on the part of the
employer.
3. MINIMUM WAGE
16
Minimum wage – the lowest wage rate that an employer
can pay his employees.
 Currently, there is no national minimum wage.
Minimum wage rates are set by region, and may vary
depending on the industry, i.e., agricultural and
industrial rates.
o Agricultural rate – applies to farm work from
land preparation to harvesting; generally lower
than industrial
o Industrial rate – applies to manufacturing or
processing of farm products
Exempted from the coverage of the rule on minimum wage:
1) Household or domestic helpers, including family
drivers and persons in the personal service of another;
2) Homeworkers engaged in needle-work;
3) Workers employed in any establishment duly
registered with the National Cottage Industries and
Development Authority in accordance with RA No
3470, provided that such workers perform the work in
their respective homes;
4) Workers in any duly registered cooperative, when so
recommended by the Bureau of Cooperative
Development and upon approval of the Secretary of
Labor and Employment;
5) Barangay Micro Business Enterprise
o refers to any business entity or enterprise engaged
in the production, processing or manufacturing of
products or commodities, including agro-
processing, trading and services, whose total
assets including those arising from loans but
exclusive of the land on which the particular
business entity's office, plant and equipment are
situated, shall not be more than Three Million
Pesos (P3,000,000.00)
Exempted Upon Application:
6) Retail/service establishments regularly employing not
more than 10 workers, upon application with and as
determined by the appropriate Regional Board
7) Establishments adversely affected by natural
calamities, distressed establishments, and new
business enterprises.
a. Payment by hours worked
The minimum wage rates for agricultural and non-
agricultural employees and workers in each and every
region of the country shall be those prescribed by the
Regional Tripartite Wages and Productivity Boards.
- I.e., this is the general rule. Workers paid by
hours worked are governed by the principles on
hours of work.
b. Payment by results
Workers Paid by Results. —
a) All workers paid by results, including those who are
paid on piecework, takay, pakyaw, or task basis, shall
receive not less than the applicable statutory minimum
wage rates prescribed under the Act for the normal
working hours which shall not exceed eight hours
work a day, or a proportion thereof for work of less
than the normal working hours.
The adjusted minimum wage rates for workers paid by
results shall be computed in accordance with the following
steps:
1) Amount of increase in AMW - Previous AMW x 100 =
% Increase;
2) Existing rate/piece x % increase = increase in rate/piece;
3) Existing rate/piece + increase in rate/piece = Adjusted
rate/piece.
Where AMW is the applicable minimum wage rate.
b) The wage rates of workers who are paid by results
shall continue to be established in accordance with
Article 101 of the Labor Code, as amended and its
implementing regulations.
Basis of output pay rate
a. On petition of any interested party, or upon its
initiative, the Department of Labor shall use all
available devices, including the use of time and
motion studies and consultation with representatives
of employers’ and workers’ organizations, to
determine whether the employees in any industry or
enterprise are being compensated in accordance with
the minimum wage requirements of this Rule.
b. The basis for the establishment of rates for piece,
output, or contract work shall be the performance of
an ordinary worker of minimum skill or ability.
c. An ordinary worker of minimum skill or ability is the
average worker of the lowest producing group
representing 50% of the total number of employees
engaged in similar employment in a particular
establishment, excluding learners, apprentices and
handicapped workers employed therein.
d. Where the output rates established by the employer do
not conform with the standards prescribed herein, or
with the rates prescribed by the DOLE in an
appropriate order, the employees shall be entitled to
the difference between the amount to which they are
entitled to receive under such prescribed standards or
rates and that actually paid them by the employer.
[Sec. 8, Rule VII-A, Book III, IRR]
From the above rules, piece rate workers may be
categorized into two:
1) Those who are paid piece rates which are prescribed in
Piece Rate Orders issued by DOLE.
 Wages or earnings in this category are
determined by simply multiplying the number of
pieces produced by the rate per piece. [Azucena]
 These workers are not covered by the Rule on
Hours of Work which provides for premium and
overtime payments.
2) Those who are paid output rates which are prescribed
by the employer and are not yet approved by the
DOLE.
The number of pieces produced is multiplied by the
rate per piece as determined by the employer:
a) If the resulting amount is equivalent to or more
than the applicable statutory minimum daily rate
17
in relation to the number of hours worked, the
worker will receive that amount.
b) If the amount is less than the applicable legal
rate, it is possible that the rates per piece are not
in accordance with the standards prescribed by
the rules implementing the Labor Code. The
employer is thus required by law to pay the
difference between the resulting amount and the
applicable legal minimum wage rate. [Azucena]
4. PAYMENT OF WAGES
I. Form: Legal Tender
 Exception: payment through checks allowed in
the ff cases – CCR (1PRC):
1. CUSTOMARY at the date of effectivity of Labor
Code
2. Stipulation in a COLLECTIVE agreement
3. When the ff REQUISITES concur: (1PRC)
a) There is a bank or other facility for
encashment within a radius of 1 km from
the workplace;
b) The employer or any of his agents or
representatives does not receive any
pecuniary benefit directly or indirectly
from the arrangement;
c) The employees are given reasonable time
during banking hours to withdraw their
wages from the bank which time shall be
considered as compensable hours worked if
done during working hours; &
d) The payment by check is with the written
consent of the employees concerned if there
is no collective agreement authorizing the
payment of wages by bank checks.
II. Time of payment: once every 2 weeks or twice a
month at intervals not exceeding 16 days
 Exceptions: FCP
1. Force majeure or circumstances beyond the
control of the employer – pay immediately
after the circumstances have ceased
2. Payment by results where the work cannot
be completed within 2 weeks:
a) Pay at intervals not exceeding 16
weeks in proportion to work
performed
b) Final settlement immediately upon
completion of work
III. Place of payment: at or near the place of undertaking
 Exceptions: OBA
1. Payment in other places – DEFA
a) Deterioration of peace and other or
actual or impending emergencies
caused by calamities;
b) Employer provides free transporation;
c) Under any other analogous
circumstances
PROVIDED:
a) the time spent by the employees in
collecting their wages shall be
 considered as compensable hours
worked;
b) No employer shall pay his employees
in any bar, night or day club, drinking
establishment, massage clinic, dance
hall, or other similar places or in
places where games are played with
stakes of money or things representing
money except in the case of persons
employed in said places.
2. Payment through banks: P251
a) Written permission of majority of
employees concerned;
b) Establishment must have 25 employees
or more
c) Establishment located within 1km
radius to the bank
3. Payment through ATM: CRAP1RR
IV. To whom: directly to the workers to whom they are
due
 Exceptions:
1. Payment through another person under written
authority for that purpose – force majeure or
other circumstances determined by Secretary of
Labor:
a) Insurance premiums
b) Union dues where the right to check-off
has been recognized in accordance with
collective agreement
c) Authorized in writing by the individual
employees concerned
2. Payment through heirs – when the worker has
died
3. Payment through member of worker’s family –
employer authorized in writing by the employee
to pay his wages to a member of the family
5. PROHIBITIONS REGARDING WAGES
1. Non-interference in disposal of wages
 No employer shall limit or otherwise
interfere with the freedom of any
employee to dispose of his wages
 No employer shall in any manner
oblige any of his employees to
patronize any store or avail of the
services offered by any person.
2. Wage deduction
 No employer, in his own behalf or in
behalf of any person, shall make any
deduction from the wages of his
employees
 Exceptions:
1) Authorized by law: payment of
premiums (w/ consent) and
payment of union dues (right to
check off recognized or authorized
in writing)
2) Payment to a third person with the
written authorization of employee
18
and no pecuniary benefit to the
employer
3. Deduction to ensure employment
4. Deposits for loss or damage
 Exceptions:
1) when the employer is engaged in
such trades, occupations or
business where the practice of
making deductions or requiring
deposits is a recognized one; or
Requisites: ROF20
a) That the employee concerned
is clearly shown to be
responsible for the loss or
damage;
b) That the employee is given
reasonable opportunity to
show cause why deduction
should not be made;
c) That the amount of such
deduction is fair and
reasonable and shall not
exceed the actual loss or
damage; and
d) That the deduction from the
wages of the employee does
not exceed 20 percent of the
employee's wages in a week.
2) is necessary or desirable as
determined by the Secretary of
Labor and Employment in
appropriate rules and regulations
 trade example: private security agencies
(Labor Advisory No 11-14)
5. Withholding of wages & kickbacks
 It shall be unlawful for any person,
directly or indirectly, to withhold any
amount from the wages of a worker or
induce him to give up any part of his
wages by force, stealth, intimidation,
threat or by any other means whatsoever
without the worker’s consent.
 Exception: clearance procedure before the
the release of wages and other benefits
(Milan v NLRC)
6. Retaliatory measures
 It shall be unlawful for an employer to
refuse to pay or reduce the wages and
benefits, discharge or in any manner
discriminate against any employee who
has filed any complaint or instituted any
proceeding under this Title or has
testified or is about to testify in such
proceedings.
7. False reporting
 it shall be unlawful for any person to
make any statement, report, or record
filed or kept pursuant to the provisions of
 this Code knowing such statement, report (j) The equitable distribution of income and wealth
or record to be false in any material along the imperatives of economic and social
respect. development.

RA 8188:
6. WAGE DETERMINATION Any person, corporation, trust, firm, partnership,
a. Wage order association or entity which refuses or fails to pay any of the
The minimum wage rates for agricultural and non- prescribed increases or adjustments in the wage rates made
agricultural employees and workers in each and every in accordance with this Act shall be punished by a fine not
region of the country shall be those prescribed by the less than Twenty- five thousand pesos (P25,000) nor more
Regional Tripartite Wages and Productivity Boards. than One hundred thousand pesos (P100,000) or
 issues wage orders subject to Guidelines by the imprisonment of not less than two (2) years nor more than
NWPC four (4) years, or both such fine and imprisonment at the
 no authority to grant across the board increases discretion of the court: Provided, That any person
convicted under this Act shall not be entitled to the benefits
National Wages and Productivity Commission, among provided for under the Probation Law.
others:
a) prescribes rules and guidelines for the determination "The employer concerned shall be ordered to pay an
of appropriate minimum wage and productivity amount equivalent to double the unpaid benefits owing to
measures at the regional, provincial, or industry levels; the employees: Provided, That payment of indemnity shall
b) reviews regional wage levels set by the Regional not absolve the employer from the criminal liability
Tripartite Wages and Productivity Boards to determine imposable under this Act.
if these are in accordance with prescribed guidelines
and national development plans "If the violation is committed by a corporation, trust or
firm, partnership, association or any other entity the penalty
The determination of wages has generally involved two of imprisonment shall be imposed upon the entity's
methods: responsible officers, including, but not limited to, the
1. the "floor-wage" method president, vice-president, chief executive officer, general
o fixing of determinate amount that would be manager, managing director or partner."
added to the prevailing statutory minimum
wage
2. the "salary-ceiling" method NWPC GUIDELINES NO. 2, SERIES OF 2012, GUIDELINES
o whereby the wage adjustment is applied to ON THE IMPLEMENTATION OF THE TWO-TIERED WAGE
employees receiving a certain denominated SYSTEM:
salary ceiling Two-tiered wage system refers to a pay system
consisting of:
ART. 124. Standards/Criteria for minimum wage fixing. 1. First tier – minimum wage as set by Regional
The regional minimum wages to be established by the Tripartite Wages and Productivity Boards
Regional Board shall be as nearly adequate as is 2. Second tier – incentive pay based on productivity
economically feasible to maintain the minimum standards improvement and gainsharing
of living necessary for the health, efficiency and general
well-being of the employees within the framework of the
national economic and social development program. In the CURRENT DAILY MINIMUM WAGE RATES
determination of such regional minimum wages, the Per Wage Order No. NCR-22 
Regional Board shall, among other relevant factors, (Effective: 22 November 2018)
consider the following:   Sector/ Basic Basic New
Industry Wage/Integrati Wage Minimu
(a) The demand for living wages; on of COLA Increas m Wage
(b) Wage adjustment vis-a-vis the consumer price e Rates
index; Non- ₱512.00 ₱25.00 ₱537.00
(c) The cost of living and changes or increases therein; Agriculture
(most important according to Atty Quan) Agriculture ₱475.00 ₱25.00 ₱500.00
(d) The needs of workers and their families; (Plantation
(e) The need to induce industries to invest in the and Non
countryside; Plantation)
(f) Improvements in standards of living; Retail/Service
(g) The prevailing wage levels; Establishment
(h) Fair return of the capital invested and capacity to s
pay of employers; employing 15
(i) Effects on employment generation and family workers or
income; and less
Manufacturin

19
 g C. LEAVES
Establishment
s Every employee who has rendered at least one year of
regularly
employing
less than
10 workers
b. Wage distortion
 wage distortion shall 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.  accrued service incentive leave.
Elements: HSER
1. Existing hierarchy of positions with corresponding
salary rates;
2. Significant change in the salary rate of a lower pay
class without the concomitant increase in the higher
one;
3. Elimination of the distinction between the two levels;
4. The existence of the distortion in the same region of
the country.
Correction of Pay Structure:
Min Wage
---------------------- = %
Actual Salary
% x Prescribed Increase Adjustment = Distortion
Correction of Wage Distortion
A. In case of an ORGANIZED establishment
1) Employer and union shall negotiate to correct the
distortion
2) Any dispute arising should be resolved through
grievance procedure under CBA
3) If dispute remains unresolved, through voluntary
arbitration (Labor Code, Art. 124)
B. In case of an UNORGANIZED establishment
1) The employer and employees shall endeavor to correct
the distortion
2) Any dispute shall be settled through National
Conciliation and Mediation Board (NCMB)
3) If remains unresolved after 10 days of conciliation, it
shall be referred to the NLRC (Labor Code, Art. 124)
Note: Any issue involving wage distortion is not a valid
ground for a strike or a lockout. (Ilaw at Buklod ng
Manggagawa, G.R. No. 91980, 1991)
20
1. SERVICE INCENTIVE LEAVE
service shall be entitled to a yearly service incentive leave
of five days with pay.
Curious Animal Doctrine
the service incentive leave is a curious animal in relation to
other benefits granted by the law to every employee. In the
case of service incentive leave, it is commutable and
cumulative.
 Commutable - the employee may choose to either
use his leave credits or commute it to its
monetary equivalent if not exhausted at the end
of the year.
 Cumulative - if the employee entitled to service
incentive leave does not use or commute the
same, he is entitled upon his resignation or
separation from work to the commutation of his
 In computing the commutation, the basis of
conversion is the salary rate at the date of
conversion.
The cause of action of an entitled employee to claim his
service incentive leave pay accrues from the moment the
employer refuses to remunerate its monetary equivalent if
the employee did not make use of said leave credits but
instead chose to avail of its commutation.
 Accordingly, if the employee wishes to accumulate his
leave credits and opts for its commutation upon his
resignation or separation from employment, his cause
of action to claim the whole amount of his
accumulated service incentive leave shall arise when
the employer fails to pay such amount at the time of
his resignation or separation from employment.
Applying Article 291 of the Labor Code in light of this
peculiarity of the service incentive leave, we can conclude
that the three (3)-year prescriptive period commences, not
at the end of the year when the employee becomes entitled
to the commutation of his service incentive leave, but from
the time when the employer refuses to pay its monetary
equivalent after demand of commutation or upon
termination of the employee’s services, as the case may be.
Exceptions – the ff are not entitled to SIL: 82-EV10S
1) Art 82 – GoMAFiFADoSeRE
 *For Domestic servants and persons in the
personal service of another, note that
kasambahays are now entitled to SIL under the
Kasambahay Law, BUT their SIL is not
cumulative and not convertible to cash.
2) those who are already enjoying the benefit herein
provided
3) those enjoying vacation leave with pay of at least five
days and
4) those employed in establishments regularly employing
less than ten employees or
5) in establishments exempted from granting this benefit
by the Secretary of Labor and Employment after
 considering the viability or financial condition of such
establishment.
2. PARENTAL LEAVE FOR SOLO PARENTS
In addition to leave privileges under existing laws, parental
leave of not more than seven (7) working days every year
shall be granted to any solo parent employee who has
rendered service of at least one (1) year.
"Solo parent" - any individual who falls under any of the
following categories:
1) A woman who gives birth as a result of rape and other
crimes against chastity even without a final conviction
of the offender: Provided, That the mother keeps and
raises the child;
2) Parent left solo or alone with the responsibility of
parenthood due to death of spouse;
3) Parent left solo or alone with the responsibility of
parenthood while the spouse is detained or is serving
sentence for a criminal conviction for at least one (1)
year;
4) Parent left solo or alone with the responsibility of
parenthood due to physical and/or mental incapacity of
spouse as certified by a public medical practitioner;
5) Parent left solo or alone with the responsibility of
parenthood due to legal separation or de facto
separation from spouse for at least one (1) year, as
long as he/she is entrusted with the custody of the
children;
6) Parent left solo or alone with the responsibility of
parenthood due to declaration of nullity or annulment
of marriage as decreed by a court or by a church as
long as he/she is entrusted with the custody of the
children;
7) Parent left solo or alone with the responsibility of
parenthood due to abandonment of spouse for at least
one (1) year;
8) Unmarried mother/father who has preferred to keep
and rear her/his child/children instead of having others
care for them or give them up to a welfare institution;
9) Any other person who solely provides parental care
and support to a child or children;
10) Any family member who assumes the responsibility of
head of family as a result of the death, abandonment,
disappearance or prolonged absence of the parents or
solo parent.
A change in the status or circumstance of the parent
claiming benefits under this Act, such that he/she is no
longer left alone with the responsibility of parenthood, shall
terminate his/her eligibility for these benefits.
Conditions for Entitlement of Parental Leave. — A solo
parent shall be entitled to parental leave provided that:
a. He/She has rendered at least one (1) year of
service whether continuous or broken at the time
of the effectivity of the Act;
b. He/She has notified his/her employer of the
availment thereof within a reasonable time
period; and
21
c. He/She has presented a Solo Parent Identification
Card to his/her employer.
3. EXPANDED MATERNITY LEAVE (RA 11210,
105-DAY EXPANDED MATERNITY LEAVE
LAW)
Section 3. Grant of Maternity Leave.—
All covered female workers in government and the private
sector, including those in the informal economy, regardless
of civil status or the legitimacy of her child, shall be
granted one hundred five (105) days maternity leave with
full pay and an option to extend for an additional thirty (30)
days without pay
 For the extended maternity leave, notify
employer or head of agency concerned for private
and public sector employees, respectively, in
writing, at least forty-five (45) days before the
end of her maternity leave.
Provided, That in case the worker qualifies as a solo parent
under Republic Act No. 8972, or the "Solo Parents’
Welfare Act", the worker shall be granted an additional
fifteen (15) days maternity leave with full pay.
Enjoyment of maternity leave cannot be deferred but
should be availed of either before or after the actual period
of delivery in a continuous and uninterrupted manner, not
exceeding one hundred five (105) days, as the case may be.
Maternity leave shall be granted to female workers in every
instance of pregnancy, miscarriage or emergency
termination of pregnancy, regardless of frequency:
Provided, That for cases of miscarriage or emergency
termination of pregnancy, sixty (60) days maternity leave
with full pay shall be granted.
 Miscarriage – pregnancy loss before the 20 th
week of gestation
 Emergency termination of pregnancy –
pregnancy loss on or after the 20 th week of
gestation, including stillbirth.
Qualification – private sector
Section 1. Eligibility. — To qualify for the grant of
maternity leave benefit, the female worker must meet the
following requirements:
6) She must have at least three (3) monthly contributions
in the twelve-month period immediately preceding the
semester of childbirth, miscarriage, or emergency
termination of pregnancy.
In determining the female member's entitlement to the
benefit, the SSS shall consider only those
contributions paid prior to the semester of
contingency; and
7) She shall have notified her employer of her pregnancy
and the probable date of her childbirth, which notice
shall be transmitted to the SSS in accordance with the
rules and regulations it may provide.
The above rules notwithstanding, failure of the pregnant
female worker to notify the employer shall not bar her from
receiving the maternity benefits, subject to guidelines to be
prescribed by the SSS
IRR
Section 3. Amount of Benefit. — Covered female workers
availing of the maternity leave benefits must receive their
full pay. Full payment of the maternity leave benefit shall
be advanced by the employer within thirty (30) days from
the filing of the maternity leave application.
In the case of self-employed female members, including
those in the informal economy, OFWs and voluntary SSS
members, the SSS shall directly pay the maternity benefit.
Section 4. Reimbursement. —
Full payment of the maternity leave benefit shall be
advanced by the employer within thirty (30) days from the
filing of the maternity leave application.
The SSS shall immediately reimburse to the employer the
maternity benefits advanced to the employed female
member, only to the extent of one hundred percent (100%)
of her average daily salary credit for one hundred five (105)
days, one hundred twenty (120) days or sixty (60) days, as
the case may be, upon receipt of satisfactory and legal
proof of such payment.
Section 5. Salary Differential, Exceptions. — Employers
from the private sector shall pay for the difference between
the full salary and the actual cash benefits received from
the SSS.
Female workers employed by exempt establishments and
enterprises, which satisfy the requirements and criteria
listed below, shall not be entitled to the salary differential.
The said female workers shall be entitled to receive only
their SSS maternity benefits.
Upon submission of proofs and other necessary documents,
the following establishments in the private sector may be
exempted from paying the salary differential herein
prescribed:
(1) Those operating distressed establishments;
a) For corporation/cooperative: when the actual net
loss amounts to 25% of total assets or when the
corporation/cooperative registers capital
deficiency, i.e. negative stockholders' equity
immediately preceding the application for
exemption.
b) For sole proprietorship and partnership: when the
accumulated net losses for the last two (2) full
accounting periods immediately preceding
application for exemption amounts to 20% or
more of the total invested capital at the beginning
of the period under review or when the sole
proprietorship/partnership registers capital
deficiency, i.e. negative net worth as of the last
full accounting period immediately preceding
application for exemption.
c) For Non-stock, non-profit organizations: when
the accumulated net losses for the last two (2) full
accounting periods immediately preceding
22
application for exemption amounts to 20% or
more of the fund balance/members' contribution
at the beginning of the period or when an
establishment registers capital deficiency, i.e.
negative fund balance/members; contribution as
of the last full accounting period or interim
period, if any, immediately preceding application
for exemption.
d) For banks and quasi-banks: when there is a
certification from the Bangko Sentral ng Pilipinas
that it is under receivership or liquidation as
provided in Section 30 of RA 7653, otherwise
known as the New Central Bank Act.
(2) Those retail/service establishments and other
enterprises employing not more than ten (10) workers;
(3) Those considered as micro-business enterprises and
engaged in the production, processing, or
manufacturing of products or commodities including
agro-processing, trading, and services, whose total
assets are not more than Three million pesos
(₱3,000,000.00); and
(4) Those who are already providing similar or more than
the benefits herein provided.
Provided, That said exemptions shall be subject to an
annual submission of a justification by the employer
claiming exemption for the approval of the DOLE.
The payment of daily SSS maternity benefits shall be a bar
to recovery of sickness benefits provided under Republic
Act No. 11199, for the same period for which daily
maternity benefits have been received.
Section 9. Dispute Resolution. — Any dispute,
controversy, or claim as regards the grant of SSS maternity
leave benefit under this Rules shall be filed before the
Social Security Commission (SSC). The filing,
determination, and settlement of disputes shall be governed
by the Rules and Regulations of the SSC, which provide
that all petitions shall be filed with the Office of the
Executive Clerk of the Commission or his/her Deputy, or at
any Regional Commission Legal Department.
Any dispute, controversy, or claim arising out of or relating
to the payment of salary differential shall be filed before
the DOLE Field/Provincial/Regional Office having
jurisdiction over the workplace and shall be subject to
existing enforcement mechanisms of the DOLE.
Qualification – public sector
Section 2. Notice of Pregnancy and Application for
Maternity Leave. — The female worker shall give prior
notice to the head of agency of her pregnancy and her
availment of maternity leave at least thirty (30) days in
advance, whenever possible, specifying the effective date
of the leave. The female worker shall use the prescribed
civil service form in the filing of the maternity leave
application, supported by a medical certificate.
Section 7. Dispute Resolution. — Any dispute,
controversy or claim arising out of or relating to the
payment of full pay shall be filed by the concerned female
worker initially to the head of agency and may be appealed
to the Civil Service Commission (CSC) Regional Office
having jurisdiction over the agency, and to the Commission
Proper, respectively. The agency shall not hold or delay the
payment of full pay to the female worker pending the
resolution of the dispute, controversy or claim.
Unique Features:
1) Grant even after termination
Maternity leave with full pay shall be granted even if the
childbirth, miscarriage, or emergency termination of
pregnancy occurs not more than fifteen (15) calendar days
after the termination of an employee’s service, as her right
thereto has already accrued: Provided, That such period is
not applicable when the employment of the pregnant
woman worker has been terminated without just cause, in
which case the employer will pay her the full amount
equivalent to her salary for one hundred five (105) days for
childbirth and sixty (60) days for miscarriage or emergency
termination of pregnancy based on her full pay, in addition
to the other applicable daily cash maternity benefits that she
should have received had her employment not been
illegally terminated. (Section 8)
2) Combination
The maternity leave can be credited as combinations of
prenatal and postnatal leave as long as it does not exceed
one hundred five (105) days and provided that compulsory
postnatal leave shall not be less than sixty (60) days.
(Section 9)
3) Allocation of maternity leave credits
Section 1. Allocation to the Child's Father or Alternate
Caregiver. — A female worker entitled to maternity leave
benefits may, at her option, allocate up to seven (7) days of
said benefits to the child's father, whether or not the same is
married to the female worker. The allocated benefit granted
to the child's father under this law is over and above that
which is provided under Republic Act No. 8187, or the
"Paternity Leave Act of 1996".
In case of death, absence, or incapacity of the child's father,
the female worker may allocate to an alternate caregiver
who may be any of the following, upon the election of the
mother taking into account the best interests of the child:
a. A relative within the fourth degree of consanguinity;
or
b. The current partner, regardless of sexual orientation or
gender identity, of the female worker sharing the same
household.
The option to allocate maternity leave credits shall not be
applicable in case the female worker suffers miscarriage or
emergency termination of pregnancy.
Section 4. Death or Permanent Incapacity of the Female
Worker. — In the event the beneficiary female worker dies
or becomes permanently incapacitated, the balance of her
maternity leave benefits, if any, shall accrue to the child's
23
father or to a qualified alternate caregiver as provided in the
preceding sections subject to the following conditions:
a. That the maternity leave benefits have not yet been
commuted to cash, if applicable; and
b. That a certified true copy of the death certificate or
medical certificate or abstract is provided to the
employers of both the female worker and the child's
father or alternate caregiver.
In case the maternity leave benefits of the deceased or
permanently incapacitated female worker have already
been paid to the latter in full, the child's father or alternate
caregiver shall be entitled to enjoy the remaining unexpired
leave credits of the female worker, if there be any, without
pay: Provided, That such leave without pay shall not be
considered as a gap in the service of the child's father or
alternate caregiver, in both the public and private sector.
For national athletes
She shall continue receiving her allowance and be entitled
to the same benefits while on maternity leave prior to
childbirth and up to six (6) months after, unless she can
resume sooner as advised by her physician, in which case,
she will be entitled to the allowance and benefits she had
prior to pregnancy: Provided, That a female national athlete
employed in the public sector shall not receive double
compensation or benefits.
4. PATERNITY LEAVE
Every married male employee in the private and public
sectors shall be entitled to a paternity leave of seven (7)
days with full pay for the first four (4) deliveries of the
legitimate spouse with whom he is cohabiting. The
male employee applying for paternity leave shall notify his
employer of the pregnancy of his legitimate spouse and the
expected date of such delivery.
For purposes, of this Act, delivery shall include
childbirth or any miscarriage.
The paternity benefits set forth herein may be enjoyed by
the qualified employee before, during or after the delivery
by his wife; provided, that the total number of days shall
not exceed seven (7) working days for each delivery.
Provided, further, that this benefit shall be availed of not
later than sixty (60) days after the date of said delivery.
5. GYNECOLOGICAL LEAVE
Any female employee in the public and private sector
regardless of age and civil status shall be entitled to a
special leave of 2 months with full pay based on her gross
monthly compensation subject to existing laws, rules and
regulations due to surgery caused by gynecological
disorders under such terms and conditions:
1. Leave must be due to surgery caused by
gynecological disorder;
2. She has rendered at least 6 months continuous
aggregate employment service for the last 12
months prior to surgery;
 3. In the event that an extended leave is necessary,
the female employee may use her earned leave
credits; and
4. This special leave shall be non-cumulative and
nonconvertible to cash.

6. BATTERED WOMAN LEAVE

At any time during the application of any protection order,
investigation, prosecution and/or trial of the criminal case,
a victim of VAWC who is employed shall be entitled to a
paid leave of up to ten (10) days in addition to other paid
leaves under the Labor Code and Civil Service Rules and
Regulations and other existing laws and company policies,
extendible when the necessity arises as specified in the
protection order.

The Punong Barangay/kagawad or prosecutor or the Clerk

of Court, as the case may be, shall issue a certification at no
cost to the woman that such an action is pending, and this is
all that is required for the employer to comply with the 10-
day paid leave.

“Violence against women and their children” refers to any

act or a series of acts committed by any person against a
woman who is his wife, former wife, or against a woman
with whom the person has or had a sexual or dating
relationship, or with whom he has a common child, or
against her child whether legitimate or illegitimate, within
or without the family abode, which result in or is likely to
result in physical, sexual, psychological harm or suffering,
or economic abuse including threats of such acts, battery,
assault, coercion, harassment or arbitrary deprivation of
liberty.

24

D. SEXUAL HARASSMENT IN THE WORK
ENVIRONMENT
1. Definition
Under the Anti-Sexual Harassment Act, sexual harassment
is committed when the following requisites are present:
1) that the offender has authority, influence or moral
ascendancy over victim in a work, training, or
education environment;
2) the offender demands, requests or otherwise requires
any sexual favor from the victim;
o the demand of a sexual favor need not be explicit
or stated. In one case, the Supreme Court
considered the offender’s act of mashing the
breast of his student sufficient to constitute
sexual harassment.
3) That either the
a) sexual favor is made as a condition:
i. in the hiring or in the employment, re-
employment or continued employment of
said individual, or;
ii. in granting said individual favorable
compensation, terms of conditions,
promotions, or privileges; or
iii. the refusal to grant the sexual favor results
in limiting, segregating or classifying the
employee which in any way would
discriminate, deprive o rdiminish
employment opportunities or otherwise
adversely affect said employee;
b) The above acts would impair the employee's rights
or privileges under existing labor laws; or
c) The above acts would result in an intimidating,
hostile, or offensive environment for the employee.
The Anti-Sexual Harassment Act makes the commission of
these acts criminal.
Under the Safe Spaces Act, The crime of gender-based
sexual harassment in the workplace includes the following:
a) An act or series of acts involving any unwelcome
sexual advances, requests or demand for sexual favors
or any act of sexual nature, whether done verbally,
physically or through the use of technology such as
text messaging or electronic mail or through any other
forms of information and communication systems, that
has or could have a detrimental effect on the
conditions of an individual’s employment or
education, job performance or opportunities;
b) A conduct of sexual nature and other conduct-based
on sex affecting the dignity of a person, which is
unwelcome, unreasonable, and offensive to the
recipient, whether done verbally, physically or through
the use of technology such as text messaging or
electronic mail or through any other forms of
information and communication systems;
c) A conduct that is unwelcome and pervasive and
creates an intimidating, hostile or humiliating
environment for the recipient:
25
Provided, That the crime of gender-based sexual
harassment may also be committed between peers and
those committed to a superior officer by a subordinate,
or to a teacher by a student, or to a trainer by a trainee;
and
Thus, under the Safe Spaces Act, the requirement of
authority, influence or moral ascendancy was removed.
However, it must be noted that the Safe Spaces Act does
not provide for any criminal punishment for the
commission of the acts defined therein. Consequently, if a
criminal case is sought to be filed, it must be under the
Anti-Sexual Harassment Act which requires the presence of
the said element. Nevertheless, under both laws, sexual
harassment is sufficient ground for dismissal. Further,
under both laws, sexual harassment may be committed
against any gender.
Duties and liabilities of employers under the Anti-Sexual
Harassment Act
Duties of employer/head of office:
1) to prevent or deter the commission of acts of sexual
harassment; and
2) to provide the procedures for the resolution,
settlement or prosecution of acts of sexual harassment,
including the creation a committee on decorum and
investigation of cases on sexual harassment which
shall be composed of at least one (1) representative
each from the management, the union, if any, the
employees from the supervisory rank, and from the
rank and file employees.
Liability
The employer or head of office or training institution shall
be solidarily liable for damages arising from the acts of
sexual harassment committed in the employment, education
or training environment if the employer or head of office,
educational or training institution is informed of such acts
by the offended party and no immediate action is taken.
SECTION 7. Penalties. - Any person who violates the
provisions of this Act shall, upon conviction, be penalized
by imprisonment of not less than one (1) month nor more
than six (6) months, or a fine of not less than Ten thousand
pesos (P10,000) nor more than Twenty thousand pesos
(P20,000), or both such fine and imprisonment at the
discretion of the court.
Any action arising from the violation of the provisions
of this Act shall prescribe in three (3) years.
Duties and liabilities of employers under the Safe Spaces
Act
Sec. 19. Liability of Employers. – In addition to liabilities
for committing acts of gender-based sexual harassment,
employers may also be held responsible for:
(a) Non-implementation of their duties under Section 17 of
this Act, as provided in the penal provisions: or
 Sec. 17. Duties of Employers. – Employers or other
persons of authority, influence or moral ascendancy in
a workplace shall have the duty to prevent, deter, or
 punish the performance of acts of gender-based sexual prevent
harassment in the workplace. Towards this end, the curtailment of
employer or person of authority, influence or moral employment
ascendancy shall: opportunities;
a) Disseminate or post in a conspicuous place a 3) The
copy of this Act to all persons in the workplace; employment
b) Provide measures to prevent gender-based sexual does not
harassment in the workplace, such as the conduct create unfair
competition in
of anti-sexual harassment seminars;
terms of labor
c) Create an independent internal mechanism or a costs or
committee on decorum and investigation to impair lower
investigate and address complaints of gender- working
based sexual harassment standards
d) Provide and disseminate, in consultation with all Limitation on No cap Only up to a
persons in the workplace, a code of conduct or number of maximum of 20%
workplace policy trainees of its regular
workforce
(b) Not taking action on reported acts of gender-based Option to Optional only Obliged to hire
sexual harassment committed in the workplace. employ learner after the
lapse of the
Any person who violates subsection (a) of this section, learnership period
shall upon conviction, be penalized with a fine of not less Wage rate 75% of the 75% of the
than Five thousand pesos (P5,000.00) nor more than Ten minimum wage minimum wage
thousand pesos (P10,000.00).
Employer may not
Any person who violates subsection (b) of this section, pay wage if
shall upon conviction, be penalized with a fine of not less apprenticeship is a
than Ten thousand pesos (P10,000.00) nor more than requirement for
Fifteen thousand pesos (P 15,000.00). graduation or
requisite for
E. WORKING CONDITIONS FOR SPECIAL Board
GROUPS OF EMPLOYEES examination
1. Apprentices and learners Qualification Apprentice must No qualifications
Apprentice – a worker undergoing practical training on the be: mandated by law
1) at least 15
job supplemented by related theoretical instructions
yrs old;
involving apprenticeable occupations and trades as may be
2) Possess
approved by the DOLE secretary, vocational
 Apprenticable occupation – any trade, form of aptitude and
employement or occupation appro ed by the DOLE capacity for
Secretary which requires for proficiency more than 3 appropriate
months of practical training on the job supplemented tests; and
by related theoretical instruction. It is an occupation 3) Possess the
officially endorsed by a tripartite body and approved ability to
for apprenticeship by TESDA. comprehend
and follow
Learner – a person hired as a trainer in semi-skilled and oral
other industrial occupations which are non-apprenticable instructions
and which may be learned through practical training on the
job for a period not exceeding 3 months, whether or not Nitto Enterprises v NLRC
Prior approval by the Department of Labor and Employment of the
such practical training is supplemented by theoretical
proposed apprenticeship program is, therefore, a condition sine qua
instructions. non before an apprenticeship agreement can be validly entered
into. Since the apprenticeship agreement between Nitto and Capili
Criteria Apprenticeship Learnership has no force and effect in the absence of a valid apprenticeship
Duration of More than 3 Not exceeding 3 program duly approved by the DOLE, Capili's assertion that he
Training months but not months was hired not as an apprentice but as a delivery boy ("kargador" or
over 6 months "pahinante") deserves credence. He should rightly be considered as
Circumstances No provision 1) When no a regular employee as defined by Article 280 of the Labor Code
justifying experienced who thus enjoys the security of tenure guaranteed in Section 3,
hiring workers are Article XIII of our 1987 Constitution.
available;
2) When
necessary to
2. Disabled workers

26
Disabled Persons are those suffering from restriction of
different abilities, as a result of a mental, physical or
sensory impairment, to perform an activity in the manner or
within the range considered normal for a human being.
a. Equal Opportunity
Sec. 5. Equal Opportunity for Employment. —
No disable person shall be denied access to opportunities
for suitable employment. A qualified disabled employee
shall be subject to the same terms and conditions of
employment and the same compensation, privileges,
benefits, fringe benefits, incentives or allowances as a
qualified able bodied person.
Five percent (5%) of all casual emergency and contractual
positions in the Departments of Social Welfare and
Development; Health; Education, Culture and Sports; and
other government agencies, offices or corporations engaged
in social development shall be reserved for disabled
persons.
b. Discrimination on employment
SECTION 32. Discrimination on Employment       five percent (25%) of the total amount paid as salaries and
No entity, whether public or private, shall discriminate
against a qualified disabled person by reason of disability in
regard to job application procedures, the hiring, promotion,
or discharge of employees, employee compensation, job
training, and other terms, conditions, and privileges of
employment. The following constitute acts of
discrimination:
a) Limiting, segregating or classifying a disabled
job applicant in such a manner that adversely
affects his work opportunities;
b) Using qualification standards, employment tests
or other selection criteria that screen out or tend
to screen out a disabled person unless such
standards, tests or other selection criteria are
shown to be jobrelated for the position on
question and are consistent with business
necessity;
c) Utilizing standards, criteria, or methods of
administration that:
1. have the effect of discrimination on the
basis of disability; or
2. perpetuate the discrimination of others
who are subject to common
administrative control;
d) Providing less compensation, such as salary,
wage or other forms of remuneration and fringe
benefits, to a qualified disabled employee, by
reason of his disability, than the amount to which
a non-disabled person performing the same work
is entitled;
e) Favoring a non-disabled employee over a
qualified disabled employee with respect to
promotion, training opportunities, study and
scholarship grants, solely on account of the
latter’s disability;
f) Re-assigning or transferring a disabled employee
to a job or position he cannot perform by reason
of his disability;
27
g) Dismissing or terminating the services of a
disabled employee by reason of his disability
unless the employer can prove that he impairs the
satisfactory performance of the work involve to
the prejudice of the business entities; Provided,
however, That the employer first sought provide
reasonable accommodations for disabled persons;
h) Failing to select or administer in the effective
manner employment tests which accurately
reflect the skills, aptitude or other factor of the
disabled applicant or employee that such test
purports to measure, rather than the impaired
sensory, manual or speaking skills of such
applicant or employee, if any; and
i) Excluding disabled persons from membership in
labor unions or similar organization.
c. Incentives for employers
Private entities that employ disabled persons who meet the
required skills or qualifications, either as regular employee,
apprentice or learner, shall be entitled to an additional
deduction, from their gross income, equivalent to twenty-
wages to disabled persons
 Provided, however, That such entities present proof as
certified by the Department of Labor and Employment
that disabled person are under their employ.
 Provided, further, That the disabled employee is
accredited with the Department of Labor and
Employment and the Department of Health as to his
disability, skills and qualifications.
Private entities that improved or modify their physical
facilities in order to provide reasonable accommodation for
disabled persons shall also be entitled to an additional
deduction from their net taxable income, equivalent to fifty
percent (50%) of the direct costs of the improvements or
modifications. This section, however, does not apply to
improvements or modifications of facilities required under
Batas Pambansa Bilang 344.
* Handicapped workers are those whose earning capacity is
impaired by age or physical or mental deficiency or injury.
(Art 78, Labor Code)
Handicapped workers may be employed when their
employment is necessary to prevent curtailment of
employment opportunities and when it does not create
unfair competition in labor costs or impair or lower
working standards. (Art 79)
Under Art 80 of the Labor Code, handicapped workers are
entitled to not less than 75% of the applicable adjusted
minimum wage. In view, however, RA 7277, the wage rate
of PWDs is 100% of the applicable minimum wage.
3. Gender
a. Discrimination
It shall be unlawful for any employer to discriminate
against any woman employee with respect to terms and
conditions of employment solely on account of her sex.
The following are acts of discrimination:
a) Payment of a lesser compensation, including wage,
salary or other form of remuneration and fringe
benefits, to a female employee as against a male
employee, for work of equal value; and
b) Favoring a male employee over a female employee
with respect to promotion, training opportunities,
study and scholarship grants solely on account of their
sexes.
b. Stipulation against marriage
It shall be unlawful for an employer:
1) to require as a condition of employment or
continuation of employment that a woman employee
shall not get married, or
2) to stipulate expressly or tacitly that upon getting
married, a woman employee shall be deemed resigned
or separated, or
3) to actually dismiss, discharge, discriminate or
otherwise prejudice a woman employee merely by
reason of her marriage.
PT&T vs NLRC
The Court cited the Constitution, CEDAW, the Labor Code,
and other laws to emphasize the state policy towards
eliminating discrimination against women.
o Article 132 ensures the right of women to be provided
with facilities and standards which the Secretary of Labor
may establish to ensure their health and safety, and
others.
o Article 136 of the Labor Code explicitly prohibits
discrimination merely by reason of the marriage of a
female employee.
 Acknowledged as paramount in the due process scheme is
the constitutional guarantee of protection to labor and
security of tenure.
PT&T’s policy of not accepting or considering as disqualified
from work any woman worker who contracts marriage runs
afoul of the test of, and the right against, discrimination,
afforded all women workers by our labor laws and by no less
than the Constitution.
Exception: bona fide occupational qualification
To justify a bona fide occupational qualification, the employer
must prove 2 factors:
1) that the employment qualification is reasonably related to
the essential operation of the job involved; and,
2) that there is a factual basis for believing that all or
substantially all persons meeting the qualification would
be unable to properly perform the duties of the job
Example - Duncan v Glaxo: conflict of interest
It is a legitimate business practice to guard business
confidentiality and protect a competitive position by even-
handedly disqualifying from jobs male and female applicants
or employees who are married to a competitor.
In any event, from the wordings of the contractual provision
and the policy in its employee handbook, it is clear that the
policy being questioned is not a policy against marriage. Glaxo
does not impose an absolute prohibition against relationships
between its employees and those of competitor companies. Its
employees are free to cultivate relationships with and marry
28
persons of their own choosing. What the company merely
seeks to avoid is a conflict of interest between the employee
and the company that may arise out of such relationships.
c. Prohibited acts
SECTION 13. Prohibited acts. — It shall be unlawful for
any employer:
a) To discharge any woman employed by him for the
purpose of preventing such woman from enjoying the
maternity leave, facilities and other benefits provided
under the Code;
b) To discharge such woman employee on account of her
pregnancy, or while on leave or in confinement due to
her pregnancy;
c) To discharge or refuse the admission of such woman
upon returning to her work for fear that she may be
pregnant;
d) To discharge any woman or child or any other
employee for having filed a complaint or having
testified or being about to testify under the Code; and
e) To require as a condition for a 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.
d. Facilities for women
ART. 130. [132] Facilities for Women.
The Secretary of Labor and Employment shall establish
standards that will ensure the safety and health of women
employees. In appropriate cases, he shall, by regulations,
require any employer to:
a) Provide seats proper for women and permit them to
use such seats when they are free from work and
during working hours, provided they can perform their
duties in this position without detriment to efficiency;
b) To establish separate toilet rooms and lavatories for
men and women and provide at least a dressing room
for women;
c) To establish a nursery in a workplace for the benefit of
the women employees therein; and
d) To determine appropriate minimum age and other
standards for retirement or termination in special
occupations such as those of flight attendants and the
like.
SECTION 11. Family planning services. — Employers
who habitually employ more than two hundred (200)
workers in any locality shall provide free family-planning
services to their employees and their spouses which shall
include but not limited to, the application or use of
contraceptives.
ART. 132. [134] Family Planning Services; Incentives
for Family Planning.
a) Establishments which are required by law to maintain
a clinic or infirmary shall provide free family planning
services to their employees which shall include, but
not be limited to, the application or use of
contraceptive pills and intrauterine devices.
In coordination with other agencies of the government
engaged in the promotion of family planning, the
Department of Labor and Employment shall develop and
prescribe incentive bonus schemes to encourage family
planning among female workers in any establishment or
enterprise.
e. Women working in night clubs, etc.
Any woman who is permitted or suffered to work with or
without compensation, in any night club, cocktail lounge,
beer house, massage clinic, bar or similar establishments,
under the effective control or supervision of the employer
for a substantial period of time as determined by the
Secretary of Labor and Employment, shall be considered as
an employee of such establishments for purposes of labor
and social legislation. No employer shall discriminate
against such employees or in any manner reduce whatever
benefits they are now enjoying by reason of the provisions
of this Section.
4. Minors
Sec. 2. Employment of Children - Children below fifteen
(15) years of age shall not be employed except:
1) When a child works directly under the sole
responsibility of his/her parents or legal guardian and
where only members of his/her family are
employed: Provided, however, That his/her
employment neither endangers his/her life, safety,
health, and morals, nor impairs his/her normal
development: Provided, further, That the parent or
legal guardian shall provide the said child with the
prescribed primary and/or secondary education; or
2) Where a child's employment or participation in public
entertainment or information through cinema, theater,
radio, television or other forms of media is
essential: Provided, That the employment contract is
concluded by the child's parents or legal guardian,
with the express agreement of the child concerned, if
possible, and the approval of the Department of Labor
and Employment: Provided, further, That the
following requirements in all instances are strictly
complied with:
a) The employer shall ensure the protection, health,
safety, morals and normal development of the
child;
b) The employer shall institute measures to prevent
the child's exploitation or discrimination taking
into account the system and level of
remuneration, and the duration and arrangement
of working time; and
c) The employer shall formulate and implement,
subject to the approval and supervision of
competent authorities, a continuing program for
training and skills acquisition of the child.
In the above-exceptional cases where any such child may
be employed, the employer shall first secure, before
engaging such child, a work permit from the Department of
Labor and Employment which shall ensure observance of
the above requirements.
29
For purposes of this Article, the term "child" shall apply to
all persons under eighteen (18) years of age.
Sec. 14. Prohibition on the Employment of Children in
Certain Advertisements. - No child shall be employed as a
model in any advertisement directly or indirectly promoting
alcoholic beverages, intoxicating drinks, tobacco and its
byproducts, gambling or any form of violence or
pornography.
Sec. 2-A. Hours of Work of a Working Child. - Under the
exceptions provided in Section 12 of this Act, as amended:
(1) A child below fifteen (15) years of age may be
allowed to work for not more than twenty (20) hours a
week: Provided, That the work shall not be more than
four (4) hours at any given day;
o No child below fifteen (15) years of age shall be
allowed to work between eight o'clock in the
evening and six o'clock in the morning of the
following day
(2) A child fifteen (15) years of age but below eighteen
(18) shall not be allowed to work for more than eight
(8) hours a day, and in no case beyond forty (40) hours
a week;
o no child fifteen (15) years of age but below
eighteen (18) shall be allowed to work between
ten o'clock in the evening and six o'clock in the
morning of the following day.
Sec. 12-B. Ownership, Usage and Administration of the
Working Child's Income. - The wages, salaries, earnings
and other income of the working child shall belong to
him/her in ownership and shall be set aside primarily for
his/her support, education or skills acquisition and
secondarily to the collective needs of the
family: Provided, That not more than twenty percent (20%)
of the child's income may be used for the collective needs
of the family.
Sec. 12-C. Trust Fund to Preserve Part of the Working
Child's Income. - The parent or legal guardian of a
working child below eighteen (18) years of age shall set up
a trust fund for at least thirty percent (30%) of the earnings
of the child whose wages and salaries from work and other
income amount to at least two hundred thousand pesos
(P200,000.00) annually, for which he/she shall render a
semi-annual accounting of the fund to the Department of
Labor and Employment, in compliance with the provisions
of this Act. The child shall have full control over the trust
fund upon reaching the age of majority.
5. Kasambahays
“Domestic worker” or “Kasambahay” refers to any person
engaged in domestic work within an employment
relationship, whether on a live-in or live-out arrangement,
 “Domestic work” refers to work performed in or for a
household
 general househelp, “yaya”, cook, gardener, or laundry
person
“Kasambahay” shall exclude:
1) family drivers,
2) service providers,
3) children who are under foster family
arrangement, or
4) any person who performs domestic work only
occasionally or sporadically and not on an
occupational basis.
Apex Mining v NLRC
The term "househelper" as used herein is synonymous to the
term "domestic servant", and shall refer to any person,
whether male or female, who renders services in and about
the employer's home and which services are usually
necessary or desirable for the maintenance and enjoyment
thereof, and ministers exclusively to the personal comfort
and enjoyment of the employer's family.
The definition cannot be interpreted to include househelp or
laundrywomen working in staffhouses of a company, like
petitioner who attends to the needs of the company's guests and
other persons availing of said facilities. By the same token, it
cannot be considered to extend to the driver, houseboy, or
gardener exclusively working in the company, the staffhouses
and its premises. They may not be considered as within the
meaning of a "househelper" or "domestic servant" as above-
defined by law.
While it may be true that the nature of the work of a
househelper, domestic servant or laundry woman in a home or
in a company staffhouse may be similar in nature, the
difference in their circumstances is that in the former instance
they are actually serving the family while in the latter case,
whether it is a corporation or a single proprietorship engaged in
business or industry or any other agricultural or similar pursuit,
service is being rendered in the staffhouses or within the
premises of the business of the employer. In such an instance,
they are employees of the company or employer in the business
concerned entitled to the privileges of a regular employee.
Section 16. Employment Age of Domestic Workers. – It
shall be unlawful to employ any person below fifteen (15)
years of age as a domestic worker. Employment of working
children, as defined under this Act, shall be subject to the
provisionsof Section 10(A), paragraph 2 of Section 12-A,
paragraph 4 of Section 12-D, and Section 13 of Republic
Act No. 7610, as amended, otherwise known as the
"Special Protection of Children Against Child Abuse,
Exploitation and Discrimination Act".
Working children shall be entitled to minimum wage, and
all benefits provided under this Act.
Any employer who has been sentenced by a court of law of
any offense against a working child under this Act shall be
meted out.
Section 22. Assignment to Nonhousehold Work. – No
domestic worker shall be assigned to work in a commercial,
industrial or agricultural enterprise at a wage rate lower
than that provided for agricultural or nonagricultural
workers. In such cases, the domestic worker shall be paid
the applicable minimum wage.
30
Rights and Privileges
§ Standard of Treatment – Employer shall not
subject a domestic worker to any kind of abuse.
§ Board, Lodging, and Medical Attendance –
Employer shall provide for the basic necessities
(3 adequate meals, humane living arrangements)
of the domestic worker.
§ Guarantee of Privacy – Employer must respect
the domestic worker’s privacy. Equally, the
domestic worker is obliged to render satisfactory
service at all times.
§ Access to Outside Communication – Employer
shall grant the domestic worker access to
communication during their free time and in case
of an emergency. The costs of using
communication facilities shall be borne by the
domestic helper, unless charges are waived by the
employer.
§ Right to Education and Training – Employer
shall afford the domestic worker the opportunity
to finish basic education.
§ Prohibition Against Privileged Information –
The domestic worker shall not publicly disclose
any information about the employer during and
after employment.
Basic Benefits
1) Minimum wage: NCR – P5,000/month
2) Rest period
§ Daily rest – aggregate of 8 hours per day
§ Weekly rest – at least 24 consecutive hours per
week
3) 13th month pay as provided for by law
4) Leave Benefits – A domestic worker who has rendered
at least 1 year of service shall be entitled to an annual
service incentive leave of 5 days with pay.
5) Social and Other Benefits - A domestic worker who
has rendered at least 1 month of service shall be
covered ff:
§ Social Security System (SSS), Philippine Health
Insurance Corporation (PhilHealth), Home
Development Mutual Fund or Pag-IBIG, and
shall be entitled to all the benefits in accordance
with the pertinent provisions provided by law.
§ Premium payments or contributions are
shouldered by employer. But if wage is Php 5000
and above per month, kasambahay shall pay
proportionate share in premium payments or
contributions.
Obligations of the Employer
1) Employer’s Reportorial Duties. – The employers shall
register all domestic workers under their employment
in the Registry of Domestic Workers in the barangay
where the employer’s residence is located.
2) Payment of Wages. – Payment of wages shall be made
on time directly to the domestic worker to whom they
are DUE IN CASH at least once a month.
3) Pay Slip. – The employer shall at all times provide the
domestic worker with a copy of the pay slip containing
 the amount paid in cash every pay day, and indicating
all deductions made, if any.
4) Prohibition on Interference in the Disposal of Wages
5) Prohibition Against Withholding of Wages. – It shall
be unlawful for an employer, directly or indirectly, to
withhold the wages of the domestic worker. If the
domestic worker leaves without any justifiable reason,
any unpaid salary for a period not exceeding fifteen
(15) days shall be forfeited.
Termination of Service
Termination Initiated by the Domestic Worker. – The
domestic worker may terminate the employment
relationship at any time before the expiration of the contract
for any of the following causes:
a. Verbal or emotional abuse of the domestic worker
b. Inhuman treatment of the domestic worker
c. Commission of a crime or offense against the
domestic worker
d. Violation by the employer of the terms and conditions
of the employment contract and other standards set
forth under this law;
e. Any disease prejudicial to the health of the domestic
worker, the employer, or member/s of the
household.
Termination Initiated by the Employer. – An employer may
terminate the services of the domestic worker at any time
before the expiration of the contract, for any of the
following causes:
a. Misconduct or willful disobedience by the domestic
worker
b. Gross or habitual neglect or inefficiency by the
domestic worker
c. Fraud or willful breach of the trust reposed by the
employer on the domestic worker
d. Commission of a crime or offense by the domestic
worker against the person of the employer
e. Violation by the domestic worker of the terms and
conditions of the employment contract
f. Any disease prejudicial to the health of the domestic
worker, the employer, or member/s of the household.
If the domestic worker is unjustly dismissed, the domestic
worker shall be paid the compensation already earned plus
the equivalent of fifteen (15) days work by way of
indemnity. If the domestic worker leaves without justifiable
reason, any unpaid salary due not exceeding the equivalent
fifteen (15) days work shall be forfeited. In addition, the
employer may recover from the domestic worker costs
incurred related to the deployment expenses, if
any: Provided, That the service has been terminated within
six (6) months from the domestic worker’s employment.
If the duration of the domestic service is not determined
either in stipulation or by the nature of the service, the
employer or the domestic worker may give notice to end
the working relationship five (5) days before the intended
termination of the service.
31
The domestic worker and the employer may mutually agree
upon written notice to pre-terminate the contract of
employment to end the employment relationship.
6. Homeworkers
Who are homeworkers?
§ Persons who perform industrial homework for an
employer, contractor, or sub-contractor
Industrial homework – system of production under which
work for an employer or contractor is carried out at the
employee’s home
• Materials may or may not be furnished by
employer or contractor
• Decentralized form of production where there is
very little supervision or regulation over methods
of work
Employer of Homeworker - natural or artificial person, who
for his / her account or benefit, or on behalf of any person
residing outside the country, directly or indirectly or
through an employee, agent, contractor, sub-contractor, or
any other person:
§ Delivers, or cases to be delivered, goods, articles,
or materials to be processed or fabricated in a
home and later disposed of or distributed in
accordance with his directions
§ Sells any goods, articles, or materials to be
processed or fabricated in a home and then re-
buys them after processing or fabrication
Prohibitions for Homework
1) Explosives, fireworks, and articles of like character
2) Drugs and poisons
3) Other articles, the processing of which requires
exposure to toxic substances
Rights and Benefits
1) Payment for services
2) Coverage in SSS, MEDICARE, ECC (homeworker’s
share in premium payment to be deducted from
payment)
§ Contributions to be remitted by employer
§ If payment is made to contractor or sub-contractor,
homeworker to be paid immediately after goods or
articles are collected.
§ Liability of employer or contractor: in case of non-
payment of wages, SOLIDARY LIABILITY with
contractor or sub-contractor to pay for homeworker’s
wages or earnings
7. Solo parents
8. Night workers
COVERAGE
1) All employees working at night
2) Work covers period between 10pm to 6am; and
3) Works for no less than 7 consecutive hours
Excluded:
Agriculture, stock raising, fishing, maritime transport,
inland navigation
Rights of Night Workers
1) Health Assessment
§ Without charge
§ Receive advice to reduce or avoid health
problems associated with their work
When?
a. Before assignment as a night worker
b. At regular intervals during assignment as night
workers
c. If they experience health problems as night
workers

2) Mandatory Facilities
a. First-aid and emergency facilities
b. Lactation station
c. Separate toilets for men and women
d. Facility for eating with potable water
e. Transportation and/or ventilated quarters, except:
1. Superior benefit in existing company practice or
in CBA
2. Start or end of night work does not fall between
12mn to 5am
3. Workplace in an area that is accessible 24 hours
to public transport
4. No. of employees below that prescribed by SOLE

3) Transfer
Unfit for night work due to health reasons
§ Transfer to a job for which they are fit to work, where
practicable
§ Transfer to a similar or equivalent position
§ Done in good faith
§ Transfer not practicable OR unable to do night work
for less than 6 months: grant company benefits same
as those unable to work due to illness; same protection
against dismissal

Women Night Workers. - Measures shall be taken to ensure

that an alternative to night work is available to women
workers who would otherwise be called upon to perform
such work:
a) Before and after childbirth, for a period of at least
sixteen (16) weeks, which shall be divided between
the time before and after childbirth;
b) For additional periods, in respect of winch a medical
certificate is produced stating that said additional
periods are necessary for the health of the mother or
child:
(1) During pregnancy;
(2) During a specified time beyond the period, after
childbirth is fixed pursuant to subparagraph (a) above,
the length of which shall be determined by the DOLE
after consulting the labor organizations and employers.

9. Migrant workers
10. Security guards

32
B. TERMINATION BY EMPLOYER
1. REQUISITES FOR VALIDITY
a. Substantive Due Process
i. Just Causes
- causes directly attributable to the fault or negligence of
the employee.
1. Serious Misconduct. — To be a valid ground for
termination, the following must be present:
1. There must be misconduct;
 "Misconduct" refers to the transgression of some
established and definite rule of action, a
forbidden act, a dereliction of duty, willful in
character and implies wrongful intent and not
mere error in judgment.
2. The misconduct must be of such grave and aggravated
character;
3. It must relate to the performance of the employee's
duties; and
4. There must be showing that the employee becomes
unfit to continue working for the employer.
Examples:
 Fighting within company premises
 uttering obscene, insulting or offensive words against
a superior
 fabrication of time records
 using employer's property equipment and personnel in
the personal business of the employee
2. Willful Disobedience or Insubordination. — To be a
valid ground for termination, the following must be present:
1. There must be disobedience or insubordination;
 "Insubordination" refers to a willful or
intentional disregard of the lawful and reasonable
instructions of the employer.
2. The disobedience or insubordination must be willful or
intentional characterized by a wrongful and perverse
attitude;
3. The order violated must be reasonable, lawful, and
made known to the employee; and
4. The order must pertain to the duties which he has been
engaged to discharge.
Examples:
 Refusal to transfer and
 refusal to report to new work assignment
3. Gross and Habitual Neglect of Duties.— To be a valid
ground for termination, the following must be present:
1. There must be neglect of duty; and
2. The negligence must be both gross and habitual in
character.
 "Gross Neglect" refers to the absence of that
diligence that an ordinary prudent man would use
in his/her own affairs.
 "Habitual Neglect" refers to repeated failure to
perform one's duties over a period of time,
depending upon the circumstances
33
NOTE: the element of habituality may be dispensed with if
the grossly negligent act resulted in substantial damage to
the company (LBC Express vs Mateo, where the employee-
driver lost the motorcycle)
Examples: Habitual tardiness, absenteeism and
abandonment (Labor, et al. v. NLRC, G.R. No. 110388,
September 14, 1995).
Failure to meet quota: "gross inefficiency" is analogous to
"gross neglect of duty," a just cause of dismissal under
Article 297 of the Labor Code, for both involve specific
acts of omission on the part of the employee resulting in
damage to the employer or to his business. An employer is
entitled to impose productivity standards for its employees,
and the latter's non-compliance therewith can lead to his
termination from work. (PUNCIA V. TOYOTA SHAW)
4. Fraud or Willful Breach of Trust — To be a valid
ground for termination, the following must be present:
1. There must be an act, omission, or concealment;
2. The act, omission or concealment involves a breach of
legal duty, trust, or confidence justly reposed;
3. It must be committed against the employer or his/her
representative; and
4. It must be in connection with the employees' work.
Examples:
 Head supervisor initiating and leading a boycott
 habitual absence of managerial employee
 failure of cashier to account for the shortage of
company funds
 complicity in the attempt to cover up pilferage of the
company's toll collections,
 stealing company property
 using double or fictitious requisition slips in order to
withdraw company materials
5. Loss of Confidence — To be a valid ground for
termination, the following must be present:
1. There must be an act, omission or concealment;
2. The employee concerned must be holding a position of
trust and confidence;
 positions of trust:
a. managerial employees, or those vested with
the power to lay down management policies;
b. cashiers, auditors, property custodians or
those who, in the normal and routine
exercise of their functions, regularly handle
significant amounts of money or property
c. those privy to confidential data or
information by nature of his function
(Prudential Guarantee vs NLRC)
3. The act, omission or concealment justifies the loss of
trust and confidence of the employer to the employee;
4. The loss of trust and confidence should not be
simulated;
5. It should not be used as a subterfuge for causes which
are improper, illegal, or unjustified; and
6. It must be genuine and not a mere afterthought to
justify an earlier action taken in bad faith.

Different rules apply in determining whether loss of trust
and confidence may validly be used as a justification in
termination cases. Managerial employees are treated
differently than fiduciary rank-and-file employees.
 With respect to rank-and-file personnel, loss of
trust and confidence as ground for valid dismissal
requires proof of involvement in the alleged
events in question, and that mere uncorroborated
assertions and accusations by the employer will
not be sufficient.
 But, as regards a managerial employee, mere
existence of a basis for believing that such
employee has breached the trust of his employer
would suffice for his dismissal. It is sufficient
that the employer has reasonable ground to
believe that the employee concerned is
responsible for the purported misconduct, and the
nature of his participation therein renders him
unworthy of the trust and confidence demanded
by his position. (BRAVO V. URIOS COLLEGE)
6. Commission of a Crime or Offense — To be a valid
ground for termination, the following must be present:
1. There must be an act or omission
punishable/prohibited by law; and
2. The act or omission was committed by the employee
against the person of employer, any immediate
member of his/her family, or his/her duly authorized
representative.
Conviction or prosecution of the employee is not necessary.
A criminal case need not be actually filed.
Examples: Illegally diverting employer's products, violation
of company rules and regulations, drunkenness, gross
inefficiency (M.F. Violago Oiler Tank Trucks v. NLRC,
117 SCRA 544 [1982]).
7. Analogous Causes — To be valid ground for
termination, the following must be present:
1. There must be act or omission similar to those
specified just causes; and
2. The act or omission must be voluntary and/or willful
on the part of the employees.
3. No act or omission shall be considered as analogous
cause unless expressly specified in the company rules
and regulations or policies.
b. AUTHORIZED CAUSES
- causes brought by the necessity and exigencies of
business, changing economic conditions and illness of the
employee
1. Installation of Labor-saving Devices. — To be a valid
ground for termination, the following must be present:
1. There must be introduction of machinery, equipment
or other devices;
2. The introduction must be done in good faith;
3. The purpose for such introduction must be valid such
as to save on cost, enhance efficiency and other
justifiable economic reasons;
34
4. There is no other option available to the employer than
the introduction of machinery, equipment or device
and the consequent termination of employment of
those affected thereby; and
5. There must be fair and reasonable criteria in selecting
employees to be terminated.
2. Redundancy. — To be a valid ground for termination,
the following must be present:
1. There must be superfluous positions or services of
employees;
2. The positions or services are in excess of what is
reasonably demanded by the actual requirements of
the enterprise to operate in an economical and efficient
manner;
3. There must be good faith in abolishing redundant
positions;
4. There must be fair and reasonable criteria in selecting
the employees to be terminated; and
5. There must be an adequate proof of redundancy such
as but not limited to the new staffing pattern,
feasibility studies/proposal, on the viability of the
newly created positions, job description and the
approval by the management of the restructuring.
3. Retrenchment or Downsizing. — To be a valid ground
for termination, the following must be present:
1. The retrenchment must be reasonably necessary and
likely to prevent business losses;
2. The losses, if already incurred, are not merely de
minimis, but substantial, serious, actual and real, or if
only expected, are reasonably imminent;
3. The expected or actual losses must be proved by
sufficient and convincing evidence;
4. The retrenchment must be in good faith for the
advancement of its interest and not to defeat or
circumvent the employees' right to security of tenure;
and
5. There must be 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.
4. Closure or Cessation of Operation. — To be a valid
ground for termination, the following must be present:
1. There must be a decision to close or cease operation of
the enterprise by the management;
2. The decision was made in good faith; and
3. There is no other option available to the employer
except to close or cease operations.
5. Disease. — To be a valid ground for termination, the
following must be present:
1. The employee must be suffering from any disease;
2. The continued employment of the employee is
prohibited by law or prejudicial to his/her health as
well as to the health of his/her co-employees; and
3. There must be certification by a competent public
health authority that the disease is incurable within a
 period of six (6) months even with proper medical
treatment.
Other causes
Other Causes of Termination. — In addition to Section 5,
the employer may also terminate an employee based on
reasonable and lawful grounds specified under its company
policies.
 An employee found positive for use of dangerous
drugs shall be dealt with administratively which shall
be a ground for suspension or termination.
 An employee shall not be terminated from work based
on actual, perceived or suspected HIV status.
 An employee shall not be terminated on basis of
actual, perceived or suspected Hepatitis B status.
 An employee who has or had Tuberculosis shall not be
discriminated against. He/she shall be entitled to work
for as long as he/she is certified by the company's
accredited health provider as medically fit and shall be
restored to work as soon as his/her illness is
controlled.
 Sexual harassment is considered a serious misconduct.
It is reprehensible enough but more so when inflicted
by those with moral ascendancy over their victim.
 An employee may also be terminated based on the
grounds provided for under the CBA.
Pregnancy
Two things may be concluded from the fact that an
unmarried woman gives birth out of wedlock:
 if the father of the child is himself unmarried, the
woman is not ordinarily administratively liable for
disgraceful and immoral conduct. 
 if the father of the child born out of wedlock is himself
married to a woman other than the mother, then there
is a cause for administrative sanction against either the
father or the mother.
o In such a case, the “disgraceful and immoral
conduct” consists of having extramarital relations
with a married person. The sanctity of marriage is
constitutionally recognized and likewise affirmed
by our statutes as a special contract of permanent
union.
Union Security Clause
Another form of termination is the enforcement of the
union security clause. To enforce the clause, 3 things are
needed to be proven:
1) the union security clause is applicable;
2) the union is requesting for the enforcement of the
union security provision; and
3) there is sufficient evidence to support the union’s
decision to expel the employee from the union.
b. Procedural Due Process
Termination of Employment Based on Just Causes.
As defined in Article 297 of the Labor Code, as amended,
the requirement of two written notices served on the
employee shall observe the following:
a) The first written notice should contain:
35
1. The specific causes or grounds for
termination as provided for under Article
297 of the Labor Code, as amended, and
company policies, if any;
2. Detailed narration of the facts and
circumstances that will serve as basis for the
charge against the employee. A general
description of the charge will not suffice;
and
3. A directive that the employee is given
opportunity to submit a written explanation
within a reasonable period.
"Reasonable period" should be construed as a period of at
least five (5) calendar days from receipt of the notice to
give the employee an opportunity to study the accusation,
consult or be represented by a lawyer or union officer,
gather data and evidence, and decide on the defenses
against the complaint.
After serving the first notice, the employer should afford
the employee ample opportunity to be heard and to defend
himself/herself with the assistance of his/her representative
if he/she so desires, as provided in Article 299 (b) of the
Labor Code, as amended.
"Ample opportunity to be heard" means any meaningful
opportunity (verbal or written) given to the employee to
answer the charges against him/her and submit evidence in
support of his/her defense, whether in a hearing, conference
or some other fair, just and reasonable way.
A formal hearing or conference becomes mandatory only
when:
1) requested by the employee in writing or
2) substantial evidentiary disputes exist or
3) a company rule or practice requires it, or when similar
circumstances justify it.
b) After determining that termination of employment is
justified, the employer shall serve the employee a
written notice of termination indicating that:
1) all circumstances involving the charge against
the employee have been considered; and
2) the grounds have been established to justify the
severance of their employment.
The foregoing notices shall be served personally to the
employee or to the employee's last known address.
Termination of Employment Based on Authorized
Causes. The requirements of due process shall be deemed
complied with upon service of a written notice to the
employee and the appropriate Regional Office of the
Department of Labor and Employment (DOLE) at least
thirty days (30) before the effectivity of the termination,
specifying the ground or grounds for termination
The mere posting on the company bulletin board does
not, meet the requirement under Article 283 of serving
a written notice on the workers. The purpose of the
written notice is to inform the employees of the specific
date of termination or closure of business operations, and The burden of proving that the termination was for a valid
must be served upon them at least one month before the or authorized cause shall rest on the employer.
date of effectivity to give them sufficient time to make the
necessary arrangements. To meet the foregoing purpose, Article 294, Labor Code. Security of tenure. - In cases of
service of the written notice must be made individually regular employment, the employer shall not terminate the
upon each and every employee of the company. services of an employee except for a just cause or when
authorized by this Title. An employee who is unjustly
Consequences of Dismissal dismissed from work shall be entitled to reinstatement
In cases of just cause, the general rule is that the employee without loss of seniority rights and other privileges and to
is not entitled to separation pay. his full backwages, inclusive of allowances, and to his other
 Exceptions: benefits or their monetary equivalent computed from the
1) CBA or company policy provides for the payment time his compensation was withheld from him up to the
thereof; time of his actual reinstatement.
2) In cases of illegal dismissal where reinstatement is no
longer possible (strained relations) NOTE: There is illegal dismissal only if there is no just or
authorized cause. If there is cause but procedural due
For authorized causes, the employee is entitled to process requirements were not complied with, the dismissal
separation pay: will be valid but the employee is entitled to damages. It is
1) Termination due to One month pay or at least only in cases of illegal dismissal that the employee will be
installation of labor- one month pay for every entitled to reinstatement without loss of seniority rights and
saving devices year of service, whichever full backwages from the time it was withheld up to the time
2) Redundancy is higher of reinstatement.
1) Retrenchment to One month pay or at least
prevent losses ½ month pay for every The Secretary of the Department of Labor and Employment
2) Closure or cessation year of service, which may suspend the effects of the termination pending
of operations of ever is higher resolution of the dispute in the event of a prima facie
establishment or finding by the appropriate official of the Department of
undertaking NOT due Labor and Employment before whom such dispute is
to serious business pending that the termination may cause a serious labor
losses dispute or is in implementation of a mass lay-off (Article
292(b), Labor Code.)
Where closure is due to serious business losses or financial
reverses, no separation pay is required. Constructive Dismissal
Constructive dismissal - a cessation of work because:
A fraction of at least six (6) months shall be considered one a) continued employment is rendered impossible,
(1) whole year. unreasonable or unlikely;
b) when there is a demotion in rank or diminution in pay
2. Preventive Suspension or both; or
SECTION 3. Preventive suspension. — The employer may c) when a clear discrimination, insensibility, or disdain
place the worker concerned under preventive suspension if by an employer becomes unbearable to the employee.
his continued employment poses a serious and imminent
threat to the life or property of the employer or of his co- The test of constructive dismissal is whether a reasonable
workers. person in the employee's position would have felt
compelled to give up his position under the circumstances.
SECTION 4. Period of suspension. — No preventive
suspension shall last longer than 30 days. The employer NOTE: there must be cessation of work. In short, the
shall thereafter reinstate the worker in his former or in a employee must quit in order for there to be constructive
substantially equivalent position or the employer may dismissal.
extend the period of suspension provided that during the  University of Immaculate Conception vs NRLC: In
period of extension, he pays the wages and other benefits this case there was no cessation of employment
due to the worker. In such case, the worker shall not be relations between the parties. It is unrefuted that
bound to reimburse the amount paid to him during the Axalan promptly resumed teaching at the university
extension if the employer decides, after completion of the right after the expiration of the suspension period. In
hearing, to dismiss the worker. other words, Axalan never quit. Hence, Axalan cannot
claim that she was left with no choice but to quit, a
A preventive suspension which lasts beyond the maximum crucial element in a finding of constructive dismissal.
period allowed by the Implementing Rules, or one which is Thus, Axalan cannot be deemed to have been
for an indefinite period of time, amounts to constructive constructively dismissed.
dismissal.
Acts of constructive dismissal:
3. Illegal Dismissal - dismissal without cause  when an employee's functions, which were originally
supervisory in nature, were reduced; and such

36
 reduction is not grounded on valid grounds such as
genuine business necessity (Norkis Trading v Genilo)
 Compelling employee to tender her resignation within
30 minutes, otherwise, she will not receive her
separation pay. (Fungo vs Lourdes School)
 Withholding of salaries for three months (Dreamland
Hotel vs Johnson)
 Unilateral reduction of work days (Intec Cebu vs CA)
However, the SC has consistently recognized and upheld
the prerogative of management to transfer an employee
from one office to another within the business
establishment, provided that:
1. there is no demotion in rank or diminution of his
salary, benefits and other privileges; AND
2. the action is not motivated by discrimination, made in
bad faith, or effected as a form of punishment or
demotion without sufficient cause.
[NOTE: so it’s not demotion or diminution per se. Both #1
and #2 must be present for the transfer to be constructive
dismissal because demotion is management prerog also]
to constitute abandonment of work, two elements must
concur: (1) the employee must have failed to report for
work or must have been absent without valid or justifiable
reason, and (2) there must have been a clear intention on
the part of the employee to sever the employer-employee
relationship manifested by some overt act.
Burden of proof
Liability of Officers
Reliefs from Illegal dismissal
1) Reinstatement without loss of seniority rights OR
separation pay, in lieu of reinstatement
GR: in an illegal dismissal case, reinstatement is the
remedy.
 Reinstatement is the restoration to a state or condition
from which one has been removed or separated
 Art 223: the decision of the Labor Arbiter reinstating a
dismissed or separated employee, insofar as the
reinstatement aspect is concerned, shall immediately
be executory, even pending appeal. The employee
shall either be admitted back to work under the same
terms and conditions prevailing prior to his dismissal
or separation or, at the option of the employer, merely
reinstated in the payroll. The posting of a bond by the
employer shall not stay the execution for reinstatement
provided herein.
 No need for a writ of execution. The intent of the law
is much like a return-to-work order, i.e, to restore the
status quo in the workplace in the meantime that the
issues raised and the proofs presented by the
contending parties have not yet been finally resolved.
 Hence, it is a provisional remedy.
 NOTE however that the executory nature of a
reinstatement order applies only to the decision of the
Labor Arbiter. You have to win at the LA level. It
does not apply to the decisions of the higher
tribunals/courts, ie NLRC.
37
 No obligation to refund salaries and wages during
pendency of the appeal. An employee cannot be
compelled to reimburse the salaries and wages he
received during the pendency of his appeal,
notwithstanding the reversal by the NLRC of the LA's
order of reinstatement
Payment of separation pay as a substitute for reinstatement
is allowed only under exceptional circumstances, viz :
1. when reasons exist which are not attributable to the
fault or are beyond the control of the employer, such
as when the employer — who is in severe financial
strait, has suffered serious business losses, and has
ceased operations — implements retrenchment, or
abolishes the position due to the installation of labor-
saving devices;
2. when the illegally dismissed employee has contracted
a disease and his reinstatement will endanger the
safety of his co-employees; or,
3. where a strained relationship exists between the
employer and the dismissed employee.
Where reinstatement is no longer viable as an option,
separation pay equivalent to one (1) month salary for every
year of service should be awarded as an alternative. It must
be stressed, however, that an illegally dismissed employee
is entitled to two reliefs: backwages and reinstatement,
which are separate and distinct. .
 In instances where reinstatement is no longer feasible
because of strained relations between the employee
and the employer, separation pay is granted. The
payment of separation pay is in addition to
payment of backwages. 
2) Backwages
Backwages are wages that the illegally dismissed employee
should have received were it not for his illegal dismissal.
Generally, backwages are computed using the wages the
employee was receiving at the time of his dismissal and
covers the period from the time he was dismissed up to
actual reinstatement.
Thus:
(salary per month) x 12 (number of days in a year) or if
employee qualified for 13th month pay, 13 x (number of
years the case dragged on)
GR: backwages computed until actual reinstatement.
XPN:
a) where separation pay in lieu of reinstatement was
ordered, in which case backwages shall be computed until
the finality of the court’s decision.
Note: do not get confused, Mais! You already got confused
during exams.
Example: EE was receiving 20k/month at the time of
termination. He worked for 2 years. The case dragged on
for 8 years.
 Backwages = 20,000 x 13 x 8 (NUMBER OF YEARS
CASE DRAGGED ON) = 2,080,000
 Separation pay = 20,000 (one month pay for every
year of service) x 10 years (TOTAL NUMBER OF
YEARS “IN SERVICE” = 200,000
b) If reinstated pending appeal, employer does not pay
backwages for the period during which he was reinstated
since the employee was receiving wages during that period.
Unlike reinstatement, backwages are not subject to
execution pending appeal. It must first attain finality.
3) Damages
Illegal dismissal – employee may recover damages in
accordance with the provisions of the Civil Code.
An employer which has a valid cause for dismissing its
employee but conducts the dismissal with procedural
infirmity is liable to pay the employee nominal damages,
in the amount of P30,000 if the ground for dismissal is a
just cause, or the amount of P50,000 if the ground for
dismissal is an authorized cause. However, this may be
modified if payment becomes impossible, unjust, or too
burdensome.
Factors in determining nominal damages in such cases
includes: 1) the authorized cause invoked; 2) the number of
employees awarded; 3) the capacity of the employers to
satisfy the awards, such as their prevailing financial
status; the employer’s grant of other termination benefits;
5) whether there was a bona fide attempt to comply
with the notice requirements.
4. Money Claims arising from ER-EE relationship
5. When not deemed dismissed; employee on floating
status
Article 301, Labor Code. When employment not
deemed terminated. –
1) The bona-fide suspension of the operation of a
business or undertaking for a period not exceeding six
(6) months, or
2) the fulfillment by the employee of a military or civic
duty
shall not terminate employment.
In all such cases, the employer shall reinstate the employee
to his former position without loss of seniority rights if he
indicates his desire to resume his work not later than one
(1) month from the resumption of operations of his
employer or from his relief from the military or civic duty.
When the bona fide suspension of the operation of a
business or undertaking exceeds six months, then the
employment of the employee shall be deemed terminated.
By the same token and applying said rule by analogy, if the
employee was forced to remain without work or assignment
for a period exceeding six months, then he is in effect
constructively dismissed. (SKM Art Corp vs Bauca)
“Off-detailing" is not equivalent to dismissal, so long as
such status does not continue beyond a reasonable time and
that it is only when such a "floating status" lasts for more
than six months that the employee may be considered to
38
have been constructively dismissed. A complaint for illegal
dismissal filed prior to the lapse of said six-month and/or
the actual dismissal of the employee is generally considered
as prematurely filed.
 Traditionally invoked by security agencies when
guards are temporarily sidelined from duty while
waiting to be transferred or assigned to a new post or
client, Article 301 of the Labor Code has been applied
to other industries when, as a consequence of the bona
fide suspension of the operation of a business or
undertaking, an employer is constrained to put
employees on floating status for a period not
exceeding six months. (Nippon Housing vs Leynes)
C. TERMINATION BY EMPLOYEE
1. with notice to employer
An employee may terminate without just cause the
employee-employer relationship by serving a written notice
on the employer at least one (1) month in advance. The
employer upon whom no such notice was served may hold
the employee liable for damages.
2. without notice to employer
An employee may put an end to the relationship without
serving any notice on the employer for any of the following
just causes:
1. Serious insult by the employer or his representative on
the honor and person of the employee;
2. Inhuman and unbearable treatment accorded the
employee by the employer or his representative;
3. Commission of a crime or offense by the employer or
his representative against the person of the employee
or any of the immediate members of his family; and
4. Other causes analogous to any of the foregoing.
3. Distinguish voluntary resignation and constructive
dismissal
Resignation is the voluntary act of employees who are
compelled by personal reasons to disassociate themselves
from their employment. It must be done with the intention
of relinquishing an office, accompanied by the act of
abandonment. It would have been illogical therefore for the
petitioner to resign and then file a complaint for illegal
dismissal (constructive dismissal).
D. RETIREMENT
“Article 302, Labor Code. Retirement. - Any employee
may be retired upon reaching the retirement age established
in the collective bargaining agreement or other applicable
employment contract.
In case of retirement, the employee shall be entitled to
receive such retirement benefits as he may have earned
under existing laws and any collective bargaining
agreement and other agreements: Provided, however, That
an employee’s retirement benefits under any collective
bargaining and other agreements shall not be less than those
provided therein.
In 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.

Unless the parties provide for broader inclusions, the term

one-half (1/2) 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 of service
incentive leaves.

Retail, service and agricultural establishments or operations

employing not more than ten (10) employees or workers are
exempted from the coverage of this provision.

Violation of this provision is hereby declared unlawful and

subject to the penal provisions under Article 288 of this
Code.” (As amended by RA 7641)

The general coverage of Republic Act No. 7641 is broad

enough to encompass all private sector employees, even
part-time employees.

An employer is free to impose a retirement age earlier than

the foregoing mandates as a valid exercise of management
prerogative. However, a retirement plan giving the
employer the option to retire its employees below the ages
provided by law must be assented to and accepted by the
employees, otherwise, its adhesive imposition will amount
to a deprivation of property without due process of law.
Acceptance by the employees of an early retirement age
option must be explicit, voluntary, free, and uncompelled.
(Cercado vs Uniprom)

39
 V. LABOR RELATIONS
A. RIGHT TO SELF-ORGANIZATION
Right to self-organization shall include the right:
1) to form, join, or assist labor organizations for the
purpose of collective bargaining through
representatives of their own choosing and
2) to engage in lawful concerted activities for the same
purpose for their mutual aid and protection
"Labor organization" means any union or association of
employees which exists in whole or in part for the purpose
of collective bargaining or of dealing with employers
concerning terms and conditions of employment.
"Legitimate labor organization" means any labor
organization duly registered with the Department of Labor
and Employment, and includes any branch or local thereof.
Hanjin Shipyard case: Ultimate objective of right to
organization: participation, not necessarily collective
bargaining
“Right” = violation = form of ULP  strike
Right to self-organization includes the right to a union,
workers’ association, and labor management councils:
Participation ER-EE Rel
Union Collective Required
Bargaining
Worker’s Mutual aid and Required
Association participation
Labor Policy and Not required
Management decision
Councils making
processes
 Right to choose whether to form or join a union or
workers’ association belongs to workers
themselves.
 the right to form a workers’ association is not
exclusive to ambulant, intermittent and itinerant
workers.
Union – employees
Federation – unions
Trade Union Center - federations
1. Who may or may not exercise the right
SECTION 2. Who May Join Labor Unions and Workers'
Associations. — All persons employed in commercial,
industrial and agricultural enterprises, including employees
of government owned or controlled corporations without
original charters established under the Corporation Code, as
well as employees of religious, charitable, medical or
educational institutions whether operating for profit or not,
shall have the right to self-organization and to form, join or
assist labor unions for purposes of collective bargaining:
Alien employees with valid working permits issued by the
Department may exercise the right to self-organization and
join or assist labor unions for purposes of collective
bargaining if they are nationals of a country which grants
40
the same or similar rights to Filipino workers, as certified
by the Department of Foreign Affairs.
For purposes of this section, any employee, whether
employed for a definite period or not, shall beginning on
the first day of his/her service, be eligible for
membership in any labor organization.
All other workers, including ambulant, intermittent and
other workers, the self-employed, rural workers and those
without any definite employers may form labor
organizations for their mutual aid and protection and other
legitimate purposes except collective bargaining.
2. Commingling or mixture of membership
“Art. 255. Managerial employees shall not be eligible to
form, join or assist any labor organization xxx”
 Any labor organization – cannot form, join, or assist
unions, LMCs, worker associations.
 Prohibition against managerial employees joining,
forming or assisting labor organizations extends to
confidential employees by virtue of the doctrine of
necessary implication
o Confidential employee – one who has necessary
access to confidential labor relations information
and who assists the managerial employee in a
fiduciary capacity
“xxx 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.
The rank and file union and the supervisors' union
operating within the same establishment may join the same
federation or national union.”
“ARTICLE 256. [245-A] Effect of Inclusion as Members of
Employees Outside the Bargaining Unit. — The inclusion
as union members of employees outside the bargaining unit
shall not be a ground for the cancellation of the registration
of the union. Said employees are automatically deemed
removed from the list of membership of said union.”
Thus, Article 255 of the Labor Code, as amended, no
longer prohibits the membership of supervisory employees
and rank-and-file employees in the same labor
organization. What is prohibits is their membership in the
same bargaining unit.
 In short, there can be a union of consisting of
supervisory and rank-and-file employees. However,
they cannot bargain together. Hence, when such union
files for a PCE, in effect, they are asking for two
elections: election of the certified bargaining agent of
rank-and-file, and election of the certified bargaining
agent of supervisory employees. Later, they will have
two CBAs as well.
 Therefore:
o One bargaining unit – represented by one union
o But one union may represent two or more
bargaining units, provided that the union must
 have 20% supervisory and 20% r&f for
registration purposes.
o This finds support in the Holy Child case.
ARTICLE 219. [212] Definitions. —
(m) "Managerial employee" is one who is vested with the
powers or prerogatives to lay down and execute
management policies and/or to hire, transfer, suspend, lay-
off, recall, discharge, assign or discipline employees.
Supervisory employees are those who, in the interest of
the employer, effectively recommend such managerial
actions if the exercise of such authority is not merely
routinary or clerical in nature but requires the use of
independent judgment.
All employees not falling within any of the above
definitions are considered rank-and-file employees for
purposes of this Book.
Registration: Legitimate Labor Organizations
(h) "Legitimate labor organization" means any labor
organization duly registered with the Department of
Labor and Employment, and includes any branch or
local thereof.
Any employee, whether employed for a definite period
or not, shall, beginning on his first day of service, be
considered as an employee for purposes of membership
in any labor union. (Art 292 (c))
Ways of Becoming LLO Types of LLO
Registration any labor organization
registered with the DOLE,
including:
1) federations
2) national unions or
industry
3) trade union centers
4) independent unions
Chartering A branch or a local of an
LLO
ARTICLE 240. [234] Requirements of Registration. — A
federation, national union or industry or trade union center
or an independent union shall acquire legal personality and
shall be entitled to the rights and privileges granted by law
to legitimate labor organizations upon issuance of the
certificate of registration based on the following
requirements:
1) Fifty pesos (P50.00) registration fee;
2) The names of its officers, their addresses, the principal
address of the labor organization, the minutes of the
organizational meetings and the list of the workers
who participated in such meetings;
3) In case the applicant is an independent union, the
names of all its members comprising at least twenty
percent (20%) of all the employees in the bargaining
unit where it seeks to operate;
41
 It is sufficient that at the time of the registration
it meets the 20% requirement. This is not a
continuing requirement.
 This does not apply to chapters/locals. They are
separate categories.
4) If the applicant union has been in existence for one or
more years, copies of its annual financial reports; and
5) Four copies of the constitution and by-laws of the
applicant union, minutes of its adoption or ratification,
and the list of the members who participated in it.
6) For Federations and National Union:
Proof of the affiliation of at least ten (10) locals or
chapters [INDEPENDENT UNIONS], each of which
must be a duly recognized collective bargaining agent
in the establishment or industry in which it operates,
supporting the registration of such applicant federation
or national union; and
7) The names and addresses of the companies where the
locals or chapters operate and the list of all the
members in each company involved.
NOTE:
‘Local or chapters’ is wrong, because federations create
locals or chapters, not the other way around. The branch
cannot create a parent. This, it must be read as
INDEPENDENT UNIONS.
 The independent unions, by creating a federation,
do NOT become chapters thereof. They are
AFFILIATES. The only way to create a chapter
is through chartering, which only federations or
national unions can do.
D.O. 40, Rule 1, Section1. Definition of Terms
“Affiliate” refers to:
a) an independent union affiliated with the federation or
the national Union or
b) a chartered local which was subsequently granted
independent registration but did not disaffiliate
from its federation, reported to the Regional Office
and the Bureau in accordance with Rule III, Section 7
and 7 of these Rules.
Affiliates also referred to as local unions.
An affiliate is not a type of labor organization, an affiliate refers to
the relationship between a company level union that has its own
legal personality and a federation.
A chapter/local is NOT an affiliate. It is a branch. Only when it is
granted independent registration but does not disaffiliate does it
become an affiliate of the federation.
Chartering
ARTICLE 241. [234-A] Chartering and Creation of a
Local Chapter. — A duly registered federation or
national union may directly create a local chapter by
issuing a charter certificate indicating the establishment of
the local chapter.
 Labor Union – Federation
The chapter shall acquire legal personality only for A local union/affiliate does not owe its existence to the
purposes of filing a petition for certification election from federation with which it is affiliated. It is a separate and
the date it was issued a charter certificate. distinct voluntary association owing its creation to the will
The chapter shall be entitled to all other rights and of its members. Mere affiliation does not divest the local
privileges of a legitimate labor organization only upon the union of its own personality, neither does it give the mother
submission of the following documents in addition to its federation the license to act independently of the local
charter certificate: union. It only gives rise to a contract of agency, where
1) The names of the chapter's officers, their the former acts in representation of the latter.
addresses, and the principal office of the chapter;
and Thus:
2) The chapter's constitution and by- PRINCIPAL AGENT AGENT OF AGENT
laws: Provided, That where the Employees Local/Chapter Federation/National
Union
chapter's constitution and by-laws are the
same as that of the federation or the national
Disaffiliation
union, this fact shall be indicated accordingly.
Disaffiliation is a right corollary to the right of association
granted by the Constitution. The right to associate
The additional supporting requirements shall be certified
necessarily entails the right not to associate.
under oath by the secretary or treasurer of the chapter and
attested by its president.
Local unions remain the basic units of association, free to
serve their own interests subject to the restraints imposed
NOTE: upon completion/submission of the foregoing
by the constitution and the by-laws of the national
requirements, the charter does NOT become an
federation, and they are also free to renounce the affiliation
independent union. It is only the completion of the
upon the terms laid down in the agreement which brought
chartering which means that they acquire full legal
about affiliation. To disaffiliate is a right, but to observe the
personality. However, they still remain as locals/chapters of
terms of affiliation is an obligation.
the federation/national union. The only way for them to
become an independent union is to register.
XPN: chartered locals – a chartered local can disaffiliate
from the federation, but it will lose its legal personality. In
The policy of the law is to encourage labor organizations to
practice, chartered locals file for independent registration
be CHAPTERS OF EXISTING FEDERATIONS instead of
prior to disaffiliation in order for it to gain new legal
independent unions that are not connected at all with any
personality despite disaffiliation.
bigger group.
- That is why it is a lot easier to organize a chapter
When to disaffiliate
not only in terms of requirements (like the
Generally, a labor union may disaffiliate from the mother
membership requirement does not apply) but also
union to form a local or independent union only during the
in terms of acquisition of LLO personality.
60-day freedom period immediately preceding the
expiration of the CBA.
Thus: acquisition of legal personality
1) Independent union, federation, national union –
However, even before the onset of the freedom period,
issuance of certificate of registration;
disaffiliation may be carried out when there is a shift of
2) Local/chapter – limited personality upon issuance of
allegiance on the part of the majority of the members of the
charter certificate; full personality upon submission of
union. In such a case, however, the CBA continues to bind
required documents.
members of the new or disaffiliated and independent union
up to the CBA’s expiration date.
Such legal personality may be questioned only through an
independent petition for cancellation of union registration
Substitutionary Doctrine
in accordance with Rule XIV of these Rules, and not by
The employees cannot revoke the validly executed
way of collateral attack in petition for certification election
collective bargaining contract with their employer by the
proceedings.
simple expedient of changing their bargaining agent. The
new agent must respect the contract. The employees,
Nature of Relationship
through their new bargaining agent, cannot renege on the
Member – Labor Union
collective bargaining contract, except to negotiate with
The relationship of the union and the member is fiduciary
management for the shortening hereof. (Azucena Vol. I, 7th
in nature. The union may be considered the agent of its
ed., p. 209).
members for the purpose of securing for them fair and just
wages and good working conditions and is subject to the
Cancellation of registration: only after hearing
obligation of giving the members as its principals all
Any party-in-interest may commence a petition for
information relevant to union and labor matters entrusted to
cancellation of registration.
it. (Heirs of Teodolo Cruz v. CIR, G.R. No. L-23331-32,
Grounds:
1969)

42
a) Misrepresentation, false statement or fraud in
connection with the adoption or ratification of the
constitution and by-laws or amendments thereto, the
minutes of ratification, and the list of members who
took part in the ratification;
b) Misrepresentation, false statements or fraud in
connection with the election of officers, minutes of the
election of officers, and the list of voters;
c) Voluntary dissolution by the members.
NOTE: grounds are exclusive. Nevermind other provisions.
A petition for cancellation of union registration shall not
suspend the proceedings for certification election nor shall
it prevent the filing of a petition for certification election
(Art 246)
ARTICLE 248. [239-A] Voluntary Cancellation of
Registration. — The registration of a legitimate labor
organization may be cancelled by the organization
itself: Provided, That at least two-thirds of its general
membership votes, in a meeting duly called for that purpose
to dissolve the organization: Provided, further, That an
application to cancel registration is thereafter submitted by
the board of the organization, attested to by the president
thereof.
ARTICLE 249. [240] Equity of the Incumbent. — All
existing federations and national unions which meet the
qualifications of a legitimate labor organization and none of
the grounds for cancellation shall continue to maintain their
existing affiliates regardless of the nature of the industry
and the location of the affiliates.
Rights and conditions of membership – FREMS –
CARPI – CAILCIARTICLE 250. [241] Rights and
Conditions of Membership in a Labor Organization. — The
following are the rights and conditions of membership in a
labor organization:
(a) No arbitrary or excessive initiation fees shall be
required of the members of a legitimate labor organization
nor shall arbitrary, excessive or oppressive fine and
forfeiture be imposed;
(b) The members shall be entitled to full and detailed
reports from their officers and representatives of all
financial transactions as provided for in the constitution and
by-laws of the organization;
(c) The members shall directly elect their officers in the
local union, as well as their national officers in the national
union or federation to which they or their local union is
affiliated, by secret ballot at intervals of five (5) years. No
qualification requirement for candidacy to any position
shall be imposed other than membership in good standing
in subject labor organization. The secretary or any other
responsible union officer shall furnish the Secretary of
Labor and Employment with a list of the newly-elected
officers, together with the appointive officers or agents who
are entrusted with the handling of funds within thirty (30)
calendar days after the election of officers or from the
43
occurrence of any change in the list of officers of the labor
organization;
(d) The members shall determine by secret ballot, after due
deliberation, any question of major policy affecting the
entire membership of the organization, unless the nature of
the organization or force majeure renders such secret ballot
impractical, in which case, the board of directors of the
organization may make the decision in behalf of the general
membership;
(e) No labor organization shall knowingly admit as
members or continue in membership any individual who
belongs to a subversive organization or who is engaged
directly or indirectly in any subversive activity;
(f) No person who has been convicted of a crime involving
moral turpitude shall be eligible for election as a union
officer or for appointment to any position in the union;
(g) No officer, agent or member of a labor organization
shall collect any fees, dues, or other contributions in its
behalf or make any disbursement of its money or funds
unless he is duly authorized pursuant to its constitution and
by-laws;
(h) Every payment of fees, dues or other contributions by a
member shall be evidenced by a receipt signed by the
officer or agent making the collection and entered into the
record of the organization to be kept and maintained for the
purpose;
(i) The funds of the organization shall not be applied for
any purpose or object other than those expressly provided
by its constitution and by-laws or those expressly
authorized by written resolution adopted by the majority of
the members at a general meeting duly called for the
purpose;
(j) Every income or revenue of the organization shall be
evidenced by a record showing its source, and every
expenditure of its funds shall be evidenced by a receipt
from the person to whom the payment is made, which shall
state the date, place and purpose of such payment. Such
record or receipt shall form part of the financial records of
the organization.
Any action involving the funds of the organization shall
prescribe after three (3) years from the date of submission
of the annual financial report to the Department of Labor
and Employment or from the date the same should have
been submitted as required by law, whichever comes
earlier: Provided, That this provision shall apply only to a
legitimate labor organization which has submitted the
financial report requirements under this Code: Provided,
further, That failure of any labor organization to comply
with the periodic financial reports required by law and such
rules and regulations promulgated thereunder six (6)
months after the effectivity of this Act shall automatically
result in the cancellation of union registration of such labor
organization;
(k) The officers of any labor organization shall not be paid
any compensation other than the salaries and expenses due
to their positions as specifically provided for in
its constitution and by-laws, or in a written resolution duly
authorized by a majority of all the members at a general
membership meeting duly called for the purpose. The
minutes of the meeting and the list of participants and
ballots cast shall be subject to inspection by the Secretary
of Labor or his duly authorized representatives. Any
irregularities in the approval of the resolutions shall be a
ground for impeachment or expulsion from the
organization;
(l) The treasurer of any labor organization and every officer
thereof who is responsible for the account of such
organization or for the collection, management,
disbursement, custody or control of the funds, moneys and
other properties of the organization, shall render to the
organization and to its members a true and correct account
of all moneys received and paid by him since he assumed
office or since the last day on which he rendered such
account, and of all bonds, securities and other properties of
the organization entrusted to his custody or under his
control. The rendering of such account shall be made:
(p) It shall be the duty of any labor organization and its
officers to inform its members on the provisions of
its constitution and by-laws, collective bargaining
agreement, the prevailing labor relations system and all
their rights and obligations under existing labor laws.
For this purpose, registered labor organizations may assess
reasonable dues to finance labor relations seminars and
other labor education activities.
Any violation of the above rights and conditions of
membership shall be a ground for cancellation of union
registration or expulsion of officers from office, whichever
is appropriate. At least thirty percent (30%) of the members
of a union or any member or members specially concerned
may report such violation to the Bureau. The Bureau shall
have the power to hear and decide any reported violation to
mete the appropriate penalty.
Criminal and civil liabilities arising from violations of
above rights and conditions of membership shall continue
to be under the jurisdiction of ordinary courts.

(1) At least once a year within thirty (30) days after the
close of its fiscal year;

(2) At such other times as may be required by a resolution

of the majority of the members of the organization; and

(3) Upon vacating his office.

The account shall be duly audited and verified by affidavit

and a copy thereof shall be furnished the Secretary of
Labor.

(m) The books of accounts and other records of the

financial activities of any labor organization shall be open
to inspection by any officer or member thereof during
office hours;

(n) No special assessment or other extraordinary fees may

be levied upon the members of a labor organization unless
authorized by a written resolution of a majority of all the
members in a general membership meeting duly called for
the purpose. The secretary of the organization shall record
the minutes of the meeting including the list of all members
present, the votes cast, the purpose of the special
assessment or fees and the recipient of such assessment or
fees. The record shall be attested to by the president.

(o) Other than for mandatory activities under the Code, no

special assessments, attorney's fees, negotiation fees or any
other extraordinary fees may be checked off from any
amount due to an employee without an individual written
authorization duly signed by the employee. The
authorization should specifically state the amount, purpose
and beneficiary of the deduction; and

44
B. BARGAINING UNIT
Bargaining Unit refers to a group of employees sharing
mutual interests within a given employer unit, comprised of
all or less than all the entire body of employees in the given
employer unit, or any specific occupational or geographical
grouping within such employer unit.
"Exclusive Bargaining Representative" refers to a
legitimate labor union duly recognized or certified as the
sole and exclusive bargaining representative or agent of all
the employees in a bargaining unit.
Fundamental factors in determining the appropriate
collective bargaining unit are:
1) will of the employees (Globe doctrine);
2) substantial mutual interests;
3) prior collective bargaining history; and
4) similarity of employment status.
Out of these, the controlling test of grouping is mutuality or
commonality of interests or when the employees
represented have substantial mutual interest in terms of
employment and working conditions as evinced by the type
of work they perform.
 the "community or mutuality of interests" test  = a
unit, to be appropriate, must affect a grouping of
employees who have substantial, mutual interests in
wages, hours, working conditions and other subjects of
collective bargaining
 similarity of employment status, duties,
responsibilities, compensation and other working
conditions
 And this is so because the basic test of an asserted
bargaining unit's acceptability is whether or not it is
fundamentally the combination which will best assure
to all employees the exercise of their collective
bargaining .
 Geographical location can be completely disregarded
if the communal or mutual interests of the employees
are not sacrificed.
Opposite of mutuality, which would call for separate
bargaining units:
 the dichotomy of interests, the dissimilarity in the
nature of the work and duties as well as in the
compensation and working conditions of the
personnel dictate the separation of two categories of
employees for purposes of collective bargaining.
The proliferation of unions in an employer unit is
discouraged as a matter of policy unless there are
compelling reasons which would deny a certain class of
employees the right to self-organization for purposes of
collective bargaining. The philosophy is to avoid
fragmentation of the bargaining unit so as to strengthen the
employees bargaining power with the management.
C. BARGAINING REPRESENTATIVE
ARTICLE 267. [255] Exclusive Bargaining
Representation and Workers' Participation in Policy
and Decision-Making. — The labor organization
45
designated or selected by the majority of the
employees in an appropriate collective bargaining unit
shall be the exclusive representative of the employees
in such unit for the purpose of collective bargaining.
However, an individual employee or group of
employees shall have the right at any time to present
grievances to their employer.
Any provision of law to the contrary notwithstanding,
workers shall have the right, subject to such rules and
regulations as the Secretary of Labor and
Employment may promulgate, to participate in policy
and decision-making processes of the establishment
where they are employed insofar as said processes
will directly affect their rights, benefits and welfare.
For this purpose, workers and employers may form
labor-management councils: Provided, That the
representatives of the workers in such labor-
management councils shall be elected by at least the
majority of all employees in said establishment.
ARTICLE 268. [256] Representation Issue in
Organized Establishments. — In organized
establishments, when a verified petition questioning
the majority status of the incumbent bargaining agent
is filed by any legitimate labor organization including a
national union or federation which has already issued
a charter certificate to its local chapter participating in
the certification election or a local chapter which has
been issued a charter certificate by the national union
or federation before the Department of Labor and
Employment within the sixty (60)-day period before
the expiration of the collective bargaining agreement,
the Med-Arbiter shall automatically order an election
by secret ballot when the verified petition is supported
by the written consent of at least twenty-five percent
(25%) of all the employees in the bargaining unit to
ascertain the will of the employees in the appropriate
bargaining unit.
ARTICLE 269. [257] Petitions in Unorganized
Establishments. — In any establishment where there
is no certified bargaining agent, a certification election
shall automatically be conducted by the Med-Arbiter
upon the filing of a petition by any legitimate labor
organization, including:
1) a national union or federation which has already
issued a charter certificate to its local/chapter
participating in the certification election; or
2) a local/chapter which has been issued a charter
certificate by the national union or federation.
In cases where the petition was filed by a national
union or federation, it shall not be required to disclose
the names of the local chapter's officers and
members.
THREE MODES:
1. Sole and Exclusive Bargaining Agent (SEBA)
Certification
2. Consent Election
 3. Certification Election
Mode of determining the SEBA will depend on
whether the establishment is organized or
unorganized and the number of LLOs therein.
 "Organized Establishment" refers to an enterprise
where there exists a recognized or certified sole
and exclusive bargaining agent.
SEBA CERTIFICATION
(Rule VII as amended by DO 40-I-15)
 Only for unorganized establishments
with only one LLO
1. Legitimate labor organization (LLO) files a
request for SEBA certification
 where? Regional Office which issued its
certification of registration/creation of
chartered local (Sec. 01)
2. DETERMINATION - Within ONE DAY from the
submission of the request, Regional Director
(RD) shall:
1) Determine whether the request complies with
the requirements under Sec 02;
 if the requirements are deficient, RD
must give LLO 10 days to complete the
same. If LLO still fails to comply, the
request shall be deemed withdrawn.
2) Determine whether the bargaining unit
sought to be represented is organized or not,
and whether it has only one LLO;
a) If ORGANIZED: RD shall refer the
request to the MEDIATOR-ARBITER for
the determination of the propriety of
conducting a certification election;
o “organized” – refers to an
enterprise where there exists a
recognized or certified sole and
exclusive bargaining agent.
b) If UNORGANIZED BUT WITH MORE
THAN ONE LLO: RD shall refer the
request to the ELECTION OFFICER for
the conduct of certification election.
3) Request a copy of the payroll for purposes of
SEBA certification pursuant to Sec 04.
3. VALIDATION CONFERENCE - If RD finds the
establishment unorganized with only one LLO:
RD shall call a validation conference within FIVE
working days for submission of the requirements
under Sec 04;
 If LLO fails to complete the Sec 04
requirements during the conference, the
RD shall refer the request to the
election officer for the conduct of
certification election (Sec 04);
46
 NOTE: so it is possible for a certification
election to be conducted in an
UNORGANIZED ESTABLISHMENT
WITH ONLY ONE LLO
4. CERTIFICATION - If RD finds the requirements
complete: he/she will issue a certification as sole
and exclusive bargaining agent, enjoying the
rights and privileges of an exclusive bargaining
agent of all the employees in the bargaining unit.
5. POSTING – RD shall cause the posting of the
SEBA Certification for FIFTEEN consecutive
days in at least two conspicuous place in the
establishment or covered bargaining unit.
*Requirements under Sec 02:
1) Certificate of registration or certificate of creation
of chartered local must be attached
 Certificate must be duly certified by the
president of the requesting union or by the
president of the federation of the local
2) Request must indicate the following:
a) Name and address of the requesting LLO;
b) Name and address of the company where it
operates;
c) The bargaining unit sought to be
represented;
d) The approximate number of employees in
the bargaining unit; and
e) The statement of the existence/non-
existence of other labor organization/CBA.
**Requirements under Sec 04 for validation
conference:
1) The names of the employees in the covered
bargaining unit who signify their support for the
certification, provided that said employees
comprise AT LEAST A MAJORITY OF THE
NUMBER OF EMPLOYEES in the covered
bargaining unit;
2) Certification under oath by the president of the
requesting union or local that all documents
submitted are true and correct based on his/her
personal knowledge.
The submission shall be presumed true and correct
unless contested under oath by any member of the
bargaining unit during the validation conference.
 For this purpose, employer or representative of
employer not a party-in-interest; mere by-stander.
*** Effect of certification (Sec. 4.2):
1) Certification year bar rule - the certification
election shall bar the filing of a petition for
certification election by any labor organization for
a period of ONE YEAR from the date of its
issuance.
2) Contract bar rule - Upon expiration of this one-
year period, any legitimate labor organization
may file a petition for certification election in the
same bargaining unit represented by the certified
 labor organization, UNLESS a CBA between the
employer and the certified labor organization was
executed and registered with the regional office in
accordance with Rule XVII.
Certification Election
1. Filing of PCE
Who may file?
a) Any LLO (including a national union or federation
which has already issued a charter certificate to
its local chapter participating in the certification
election or the local/chapter itself)
 Note the qualification for federations or
national unions. If independent union, even if
affiliated with a federation, federation cannot
file on its behalf
b) Employer, when requested to bargain collectively
in a bargaining unit where no registered CBA
exists and no SEBA exists.
 However, it shall not be considered a party
thereto with the right to oppose a petition.
 Its participation, if at all, is limited to:
i. Being notified of the proceedings;
ii. Submitting the list of employees
during the pre-election conference,
should the Med-Arbiter favorably
act on the petition; and
iii. Manifestation of facts that would aid
the Med-Arbiter in expeditiously
resolving the petition, such as the
existence of the certification
election bars.
Note: Manuel - But the law says that the
employer shall only be a by-stander. This is
another case where the DOLE creates
loopholes in their rules. It’s an
inconsistency. In effect, the Rules is
allowing the employer to ‘oppose’ the
petition via ‘manifestation’ since what it is
allowed to manifest will ultimately be for the
denial of the petition. It’s a circumvention of
the law.
Forced Intervenor: incumbent SEBA shall be
automatically one of the choices in the certification
election as forced intervenor.
Who else can intervene?
a) When a petition for certification election was filed
in an organized establishment:
 Any legitimate labor union other than the
incumbent bargaining agent operating within
the bargaining unit may file a motion for
intervention with the Mediator Arbiter during
the freedom period of the CBA.
 The form and contents of the motion shall be
the same as that of a petition for certification
election.
b) In an unorganized establishment:
 The motion shall be filed at any time prior to
the decision of the Mediator-Arbiter.
47
 The form and contents of the motion shall
likewise be the same as that of a petition for
certification election.
The motion for intervention shall be resolved in the
same decision issued in the petition for certification
election.
Form and Content
The petition shall be in writing, verified under oath by
the president of petitioning labor organization. Where
the petition is filed by a federation or national union, it
shall verified under oath by the president or its duly
authorized representative.
In an organized establishment, the signature of at
least twenty five percent (25%) of all employees in the
appropriate bargaining unit shall be attached to the
petition at the time of its filing.
Where to file?
a) Regional Office which issued its certification of
registration/creation of chartered local;
b) May also be filed online
When to file? Anytime, EXCEPT: see bars in
grounds for denial
a) Certification Year Bar / 1-year Bar – within one
year from the holding of a SEBA certification or
valid certification, consent or run-off election;
 Note: when the results of the election is
appealed, the one-year period is suspended
until the decision on the appeal has become
final and executory
 So there must have been an election. Mere
denial of PCE during the preliminary
conference not sufficient.
b) Negotiation Bar – when the duly certified union
has commenced and sustained negotiations in
good faith with the employer within the same one-
year period;
 Its sufficient that the negotiations
commenced within the one-year period. In
effect, as long as they are in good faith, this
could go on forever.
c) Deadlock Bar – when a bargaining deadlock to
which an incumbent or certified bargaining agent
is a party had been submitted to conciliation or
arbitration or had become the subject of a valid
notice of strike or lockout;
d) Contract Bar – when a CBA between the
employer and a duly recognized or certified
bargaining agent has been registered, in which
case the petition may be filed only within 60 days
prior to its expiry.
2. Raffle - RD or his duly authorized representative
shall immediately assign it by raffle to a Mediator-
Arbiter, which may be done in the presence of the
petitioner if he so desires.

3. Preliminary Conference
Who Presides: Med-Arbiter
PURPOSE: To determine the appropriate bargaining
unit, who are the parties, determine the possibility of a
consent election, if there are grounds to deny the
petition or not.
 w/in 3 days, serve petition to employer, and serve
notice of preliminary conference to the petitioner
and incumbent bargaining agent
 Both copy of petition and notice must be posted
within the same 3-day period in at least two
conspicuous places in the establishment
 No set number of hearings, but should not
exceed 15 days from preliminary conference.
determine possibility of Consent Election
 if found possible, proceed to pre-election
conference: Forward records to RD /
representative; first preliminary-election
conference – within 10 days from agreement
 Med-Arbiter may conduct as many hearings
as necessary, but in no case shall the
conduct thereof exceed 15 days from the
date of the scheduled preliminary conference
Grounds to oppose/deny the PCE:
1. Petitioning union/national union/fed not listed
in the Department’s registry of legitimate
labor unions or its registration certificate has
been cancelled with finality;
2. Failure of local/chapter or NU/fed to submit a
duly issued charter cert upon filing of the
petition for CE;
3. Filing the petition in violation of the
certification/1 year bar from the holding of a
valid certification/consent elections;
4. Filing the petition in violation of the
negotiation bar
5. Where there exists a bargaining deadlock
submitted to conciliation or arbitration, or has
become the subject a valid notice of strike or
lockout where an incumbent SEBA is a party
6. Filing of the petition in violation of the
contract bar rule (before or outside the
freedom period)
7. In organized establishments, failure to
submit the 25% signature requirement;
o the written consent of at least twenty-
five percent (25%) of all the employees
in the bargaining unit to
8. Non-appearance for 2 consecutive
scheduled conferences despite due notice
9. Absence of EE-ER relationship between ALL
the members of the union and the
establishment
4. Outcome of preliminary conference: grant or
deny petition
48
 Must be within 10 days from last hearing
 *Ancillary issues: all issues pertaining 1) ER-
EE Rel, 2) Eligibility, 3) mixture of
membership shall be resolved in the same
order
 Issues pertaining to validity of : 1) union’s
cert of registration/legal personality; 2)
registration and exec of CBA shall be heard
and resolved by RD in an independent
petition for cancellation of registration
UNLESS: 1) petitioning union not listed in the
roster of LLOs or 2) CBA not registered w/
Department
 APPEAL: File MoAppeal to RD à Transmit
records to Osec à Reply à DOLE Sec’s
decision
 Appeal must be filed w/in 10 days,
Reply 10 days from receipt, Sec to
decide within 15 days, final and
executory upon lapse of 10 days.
No MR allowed
 Xpn: petition granted in
unorganized establishment:
Unappealable; any issue arising
therefrom may be raised by means
of protest on the conduct and
results of the CE
5. RD: Raffle to an Election Officer
 Within 24 hrs from receipt of notice of entry
of final judgment granting the CE, RD shall
cause the raffle of the case to an election
officer who shall have control of the pre-
election conference and election
proceedings.
Within 10 days from receipt of assignment and
completed within 3 days of first hearing
Posting of notices – 10 days before elections; 2
conspicuous places in the company premises
6. Pre-election Conference
 Within 24 hrs from receipt of the assignment
for the conduct of CE, election officer shall
issue notice of pre-election conference upon
the contending unions
 Pre-election conference shall be scheduled
within 10 days from such receipt
Who presides? Election officer.
What happens during this stage?
a) In this stage, employer shall be required to
submit certified list of employees or where
necessary the payrolls covering members of the
bargaining unit
b) why? This is where they finalize the list of eligible
voters. It is still subject to contentions of Unions.
At this stage, the Unions determine who will be
part of the list of eligible voters
- Qualifications for voters:
i. There is a CUT OFF DATE: All
employees who are members of
 the appropriate bargaining unit
three months prior to the filing of
the petition/request shall be
eligible to vote
ii. An employee who has been
dismissed from work but has
contested the legality of the
dismissal at the time of the
issuance of the order for the
conduct of CE 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 CE
- In case of disagreement over the voters’ list
or their eligibility, all contested voters shall
be allowed to vote. BUT their votes shall be
segregated and sealed in individual
envelopes. (one vote = one envelope)
- IF the segregated votes will be material to
the election or might change the result, it will
be opened. The Med-Arbiter will decide
eligibility.
- T/F: If the segregated votes can materially
alter the final results of the CE, the next step
is to open and count – FALSE. If the
segregated votes are material, you do not
proceed to opening the envelopes but to
determine which to open and count. Med-
Arbiter must determine the eligibility of the
voters. In fact, you may not need to open the
ballots.
7. CERTIFICATION ELECTION
 Election Officer to post notice of election at least
10 days before actual date in 2 most conspicuous
places in the company premises
 CE conducted not later than 45 days from first
pre-election conference
*Art 256: To have a valid election, at least a majority
of all eligible voters in the unit must have cast their
votes.
 The choice receiving the HIGHEST votes cast
during the re-run election shall be declared the
winner and shall be certified accordingly.
 Failure of election – where the number of votes
cast in a certification or consent election is less
than the majority number of the number of eligible
voters and there are no material challenged votes
 A failure of election shall not bar the filing of a
motion for the immediate holding of another
certification or consent election within 6 months
from the date of declaration
o One-year/certification bar not applicable.
Run-off election: When a valid election which
provides for three or more choices results in no choice
receiving a majority of the valid votes cast, and there
are no objections or challenges which if sustained can
materially alter the results, the election officer shall
motu propio conduct a run-off election between the
labor unions receiving the two highest number of
votes: Provided, that the total number of votes for all
contending unions is at least fifty percent (50%) of the
number of votes cast.
o “No union” considered as a choice in “3 or more
choices” so all you need are 2 unions + no union.
However, in the run-off elections proper, no union
shall not be a choice.
o The labor union receiving the GREATER number
of valid votes cast shall be certified as the winner.
o Failure to get the 50% = indirectly, no union will
win. You had valid elections so certification bar
kicks in
At the expiration of the freedom period, the employer
shall continue to recognize the majority status of the
incumbent bargaining agent where no petition for
certification election is filed.

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.

Re-run election: election conducted to break a tie

between contending unions, including between the
“no union” and one of the unions. It shall likewise refer
to an election conducted after a failure of election has
been declared by the election officer and/or affirmed
by the mediator-arbiter.
 When a certification, consent, or run-off election
results to a tie between the two choices, the
election officer shall immediately notify the parties
of a re-run election.
 The election officer shall cause the posting of the
notice of re-run election within 5 days from the
certification.

49
50
*Spoiled ballots – a ballot that is torn, defaced, or left No Union 50
unfilled in such a manner as to create doubt or Spoiled Ballots 20
confusion to identity the vote. (have foreign or Total 130
identifying marks)
 Included in determination of first majority but NOT 1st Majority: 76 [150/2 = 75 + 1]
included in second majority since NOT  Since 130 voted, 1st majority is met. You have a
CONSIDERED AS VALID VOTES; valid election.
 NEVER OPENED (not included for purposes of
determination of possibility of run-off) 2nd Majority: 56 [130-20 = 110/2 = 55 + 1]
 No winner: none of the choices received 56
*Abstention – refers to a blank or unfilled ballot validly  No segregated votes
cast by an eligible voter. It is considered as a valid  50% of 130 = 65
vote for purposes of determining the validity of an o 50% requirement not met. Votes for union A
election. However, it is not considered as a negative and Union B is only 60.
vote or a vote for no union. It is a separate category. o Cannot proceed to run-off. Indirectly, no
union wins. Since there was still a valid
Example:
election, the 1-year bar rule will apply. Union
Total Eligible Voters: 150
A and Union B can try next year na.
Union A 70
Union B 30
No Union 20
 Protest – any party-in-interest; file a protest with
Spoiled Ballots 10
Election Officer immediately after the last ballot
Total 130 cast. Otherwise, waived. Thereafter, formalize
protest w/ Med-Arbiter within 5 days from the
1st Majority: 76 [150/2 = 75 + 1] close of the election proceedings. Otherwise,
 Since 130 voted, 1st majority is met. You have a protest deemed dropped.
valid election.  ARTICLE 272. [259] Appeal from Certification
Election Orders. — Any party to an election may
2 Majority: 61 [130-10 = 120/2 = 60 +1]
nd
appeal the order or results of the election as
 Since Union A got 70 votes, Union A wins. determined by the Med-Arbiter directly to the
Secretary of Labor and Employment on the
What if instead of spoiled ballots, we have ground that the rules and regulations or parts
abstention? First majority remains the same. thereof established by the Secretary of Labor and
However, second majority becomes 71 because Employment for the conduct of the election have
abstention votes are considered as valid votes. Union been violated. Such appeal shall be decided
A will not win. within fifteen (15) calendar days.
Example: 8. Canvass of Votes
Total Eligible Voters: 150 Votes counted by Election Officer in the presence
Union A 50 of the representatives of the contending unions
Union B 40
No Union 30 9. Transmit records to Med-Arbiter; Order
Spoiled Ballots 10 proclaiming results
Total 130
Remember:
1st majority: 1st Majority: 76 [150/2 = 75 + 1] ARTICLE 246. [238-A] Effect of a Petition for
 Since 130 voted, 1st majority is met. You have a Cancellation of Registration. — A petition for
valid election. cancellation of union registration shall not suspend
the proceedings for certification election nor shall it
2nd majority: 61 [130 – 10 = 120/2 = 60 + 1] prevent the filing of a petition for certification election.
 None of the choices received 61.
 No segregated votes that could alter the result Further, generally, the pendency of a ULP case filed
 50% of the total number of votes = 65 against a labor organization participating in the
o Total number of votes for contending certification election does not stay the holding thereof.
unions: 90
o Unions A and B proceed to run-off However, the pendency of a formal charge of
company domination against one of the unions which
Example: is participating in the certification election is a
Total Eligible Voters: 150 prejudicial question that bars the holding thereof until
Union A 50 its final resolution.
Union B 10

51
D. RIGHTS OF LABOR ORGANIZATIONS
ARTICLE 251. [242] Rights of Legitimate Labor
Organizations. — A legitimate labor organization shall
have the right:
a) To act as the representative of its members for
the purpose of collective bargaining;
b) To be certified as the exclusive representative of
all the employees in an appropriate bargaining
unit for purposes of collective bargaining;
c) To be furnished by the employer, upon written
request, with its annual audited financial
statements, including the balance sheet and the
profit and loss statement:
1) within thirty (30) calendar days from the date
of receipt of the request, after the union has
been duly recognized by the employer or
certified as the sole and exclusive bargaining
representative of the employees in the
bargaining unit, or
2) within sixty (60) calendar days before the
expiration of the existing collective
bargaining agreement, or during the
collective bargaining negotiation;
d) To own property, real or personal, for the use and
benefit of the labor organization and its members;
e) To sue and be sued in its registered name; and
f) To undertake all other activities designed to
benefit the organization and its members,
including cooperative, housing, welfare and other
projects not contrary to law.
Notwithstanding any provision of a general or special
law to the contrary, the income and the properties of
legitimate labor organizations, including grants,
endowments, gifts, donations and contributions they
may receive from fraternal and similar organizations,
local or foreign, which are actually, directly and
exclusively used for their lawful purposes, shall be
free from taxes, duties and other assessments. The
exemptions provided herein may be withdrawn only
by a special law expressly repealing this provision.
1. Check-off, assessments, and agency fees
All unions are authorized to collect reasonable
membership fees, union dues, assessments, and
fines and other contributions for labor education and
research, mutual death and hospitalization benefits,
welfare fund, strike fund and credit and cooperative
undertakings. (Labor Code, Art. 250)
A. Check-off - a method of deducting by the
employer from an employee’s pay at prescribed
period, the amounts due the union for fees, fines or
assessments.
The right to collect union dues are accorded to all
unions. However, the right to check-off union dues or
agency fees is available only to the SEBA. The
employer therefore is not under any legal obligation to
check-off any union dues and assessments for the
minority union.
52
 Further, the right of the incumbent SEBA to
check-off and to collect dues is not affected by
the pendency of a representation case or an
intra-union dispute.
Two kinds of check-off:
1) Collection of union dues, special assessments,
and fees (such as atty’s fees, negotiation fees, or
any other extraordinary fees) by the SEBA from
its members; and
2) Collection of agency fees from non-members of
the SEBA but covered by and included in the
collective bargaining unit who accept the benefits
provided in the CBA.
The first type (check-off of union dues, special
assessments and fees) requires for its validity the
execution by the employees of individual written
authorization which should specifically state the
amount, purpose, and beneficiary of the deduction, in
accordance with Art 250 (o).
 Art 250 (o): Other than for mandatory activities
under the Code, no special assessments,
attorney's fees, negotiation fees or any other
extraordinary fees may be checked off from any
amount due to an employee without an individual
written authorization duly signed by the
employee. The authorization should specifically
state the amount, purpose and beneficiary of the
deduction
The second kind does not require any such
authorization since the law itself, under Art 259,
recognizes and allows it upon the non-SEBA
member’s acceptance of benefits resulting from the
CBA.
 Art 259 (e): Employees of an appropriate
bargaining unit who are not members of the
recognized collective bargaining agent may be
assessed a reasonable fee equivalent to the
dues and other fees paid by members of the
recognized collective bargaining agent, if such
non-union members accept the benefits under
the collective bargaining agreement: Provided,
That the individual authorization required under
Article 242, paragraph (o) of this Code shall not
apply to the non-members of the recognized
collective bargaining agent.
 Note: the non-SEBA members who pay agency
fees to the SEBA remain liable to pay union dues
to their own union. Union dues are required for
the continued existence and viability of their
union. Thus, they are obliged to pay 2 kinds of
dues: 1) union dues to their own union; and 2)
agency fees to the SEBA.
B. Assessments
In accordance with Art 250 (o), the following requisites
in order for union dues and special assessments for
the union’s incidental expenses, atty’s fees, and
representation expenses to be valid:
1) Authorization by a written Resolution of the
majority of all the members at the general
membership meeting duly called for that purpose;
2) Secretary’s record of the Minutes of the meeting
including the list of members present, votes cast,
purpose of the special assessments and the
recipient of such assessments which must be
attested to by the President;
3) Individual written authorization for check-off duly
signed by the employee concerned to levy such
assessments.
Written authorization not required in the ff cases:
1. For mandatory activities provided under the
Labor Code;
2. Agency fees for non-members of the union avail
of the benefits of the CBA;
3. Check-off for union service fees authorized by
law;
4. Deductions for withholding tax mandated under
the NIRC;
5. Deductions for withholding of wages because of
employee’s debt to the employer which is already
due;
6. Deductions made pursuant to a judgment against
the worker under circumstances where the wages
may be the subject of attachment or execution
but only for debts incurred for food, clothing,
shelter and medical attendance;
7. Deductions from wages authorized by the court;
8. Deductions authorized by law such as for
premiums for PhilHealth, SSS, Pag-IBIG etc.
NOTE: unlike in authorization for union dues and
assessments, disauthorization does not require that it
be written individually.
2. Collective Bargaining
The mechanics of collective bargaining is set in
motion only when the following jurisdictional
preconditions are present, namely,
a. Employer-employee relationship must exist
between the employer and the members of the
bargaining unit being represented by the SEBA;
b. The majority status of the SEBA must be duly
established through any of the modes sanctioned
by law (SEBA Cert, certification election etc)
c. The bargaining unit sought to be represented by
the SEBA should be validly constituted and
established in accordance with law;
d. There should be a lawful written demand to
bargain and a clear statement of the proposals by
one party to negotiate an agreement and the
equivalent counter-proposals thereto by the other
party before the collective bargaining negotiations
process may validly commence, in accordance
with Art 261.
ARTICLE 262. [251] Duty to Bargain Collectively in
the Absence of Collective Bargaining Agreements.
— In the absence of an agreement or other voluntary
arrangement providing for a more expeditious manner
53
of collective bargaining, it shall be the duty of
employer and the representatives of the employees to
bargain collectively in accordance with the provisions
of this Code.
ARTICLE 263. [252] Meaning of Duty to Bargain
Collectively. — The duty to bargain collectively
means the performance of a mutual obligation to meet
and convene promptly and expeditiously in good faith
for the purpose of negotiating an agreement with
respect to wages, hours of work and all other terms
and conditions of employment including proposals for
adjusting any grievances or questions arising under
such agreement and executing a contract
incorporating such agreements if requested by either
party but such duty does not compel any party to
agree to a proposal or to make any concession.
ARTICLE 264. [253] Duty to Bargain Collectively
When There Exists a Collective Bargaining
Agreement. — When there is a collective bargaining
agreement, the duty to bargain collectively shall also
mean that neither party shall terminate nor modify
such agreement during its lifetime. However, either
party can serve a written notice to terminate or modify
the agreement at least sixty (60) days prior to its
expiration date.
 60 day period referred to herein is for the
purpose of commencing a new CBA
HOLDOVER : It shall be the duty of both parties to
keep the status quo and to continue in full force and
effect the terms and conditions of the existing
agreement during the 60-day period and/or until a
new agreement is reached by the parties.
ARTICLE 261. [250] Procedure in Collective
Bargaining. — The following procedures shall be
observed in collective bargaining:
a) When a party desires to negotiate an agreement,
it shall serve a written notice upon the other party
with a statement of its proposals. The other party
shall make a reply thereto not later than ten (10)
calendar days from receipt of such notice;
b) Should differences arise on the basis of such
notice and reply, either party may request for a
conference which shall begin not later than ten
(10) calendar days from the date of request.
c) If the dispute is not settled, the Board shall
intervene upon request of either or both parties or
at its own initiative and immediately call the
parties to conciliation meetings. The Board shall
have the power to issue subpoenas requiring the
attendance of the parties to such meetings. It
shall be the duty of the parties to participate fully
and promptly in the conciliation meetings the
Board may call;
d) During the conciliation proceedings in the Board,
the parties are prohibited from doing any act
which may disrupt or impede the early settlement
of the disputes; and
e) The Board shall exert all efforts to settle disputes
amicably and encourage the parties to submit
their case to a voluntary arbitrator.
While it is a mutual obligation of the parties to bargain,
the employer, however, is not under any legal duty to
initiate contract negotiation.
Manuel: subparagraph c of Art 261 is an
oversimplification of the process. Subparagraph c will
only come in when the parties have exhausted the
negotiation process and have reached a deadlock
with either party filing a notice of strike or lockout, as
the case may be.
Violation of Duty to Bargain = ULP
 Consequence if notice to bargain together w/
proposals and failed to respond: proposed CBA
may be deemed the CBA of the Company, upon
pronouncement by the NLRC (Kiok Loy vs NLRC)
 Kiok Loy Dy doctrine: for refusal to bargain, the
employer had thereby lost its right to bargain the
terms and conditions of the CBA. Consequently,
all terms and conditions of the CBA as proposed
by the SEBA are deemed approved and
accepted, lock, stock and barrel by the erring
employer.
Single and Multi-Employer Bargaining
 Single – one employee unit negotiating with the
employer. This is compulsory.
 Multi – pairs of employer and SEBA negotiating
together. This is voluntary. Employers may refuse
to join a multi-employer bargaining.
o In reality, this is not happening. Single-
employer bargaining is already
complicated enough.
ARTICLE 251. [242] Rights of Legitimate Labor
Organizations. — A legitimate labor organization
shall have the right:
(c) To be furnished by the employer, upon written
request, with its annual audited financial statements,
including the balance sheet and the profit and loss
statement
1) within thirty (30) calendar days from the date of
receipt of the request, after the union has been
duly recognized by the employer or certified as
the sole and exclusive bargaining representative
of the employees in the bargaining unit, or
2) within sixty (60) calendar days before the
expiration of the existing collective bargaining
agreement, or during the collective bargaining
negotiation;
Failure to disclose the said financial statements
despite a written request therefor amounts to ULP
ARTICLE 265. [253-A] Terms of a Collective
Bargaining Agreement. — Any Collective Bargaining
Agreement that the parties may enter into shall,
54
insofar as the representation aspect is concerned, be
for a term of five (5) years. No petition questioning the
majority status of the incumbent bargaining agent
shall be entertained and no certification election shall
be conducted by the Department of Labor and
Employment outside of the sixty-day period
immediately before the date of expiry of such five-year
term of the Collective Bargaining Agreement
All other provisions of the Collective Bargaining
Agreement shall be renegotiated not later than three
(3) years after its execution.
Any agreement on such other provisions of the
Collective Bargaining Agreement entered into within
six (6) months from the date of expiry of the term of
such other provisions as fixed in such Collective
Bargaining Agreement, shall retroact to the day
immediately following such date. If any such
agreement is entered into beyond six months, the
parties shall agree on the duration of retroactivity
thereof. In case of a deadlock in the renegotiation of
the Collective Bargaining Agreement, the parties may
exercise their rights under this Code.
A SEBA does NOT have a term.
CBA effective from agreement of parties.
Representation aspect starts from effectivity of
CBA, but contract bar only arises upon
registration 60-day freedom period vs. 60-day
negotiation period.
60-DAY PERIOD to negotiate always reckoned prior
to expiry date of the CBA. On the other hand, 60-day
freedom period reckoned from the expiry of the 5-
YEAR term.
Thus, if you have 6 year CBA, the freedom period is
60 days prior to the expiration of the 5th year, while
the 60-day period to negotiate is on the 6th year.
Example:
Let’s say we have a 3-year CBA, renewed by the
parties for another 3 years.
Where is the 60-day period in Art 264? (either party
can serve a written notice to terminate or modify the
agreement at least 60 days prior to its expiration d
 Last 60 days of the 3rd year. This is the time to
start negotiating for a new CBA.
Where Is the 60-day freedom period?
 Last 60 days of the 5th year. In effect, the last 60
days of the 2nd year of the 2nd CBA. That will be
the time to file a PCE.

Example:
There are cases where the two 60-day periods may
overlap or coincide, such as when the CBA is for a
5=year term.
NOTE: CBA valid regardless of registration but,
registration gives rise to contract bar rule, ie 5 year
representation aspect
 So if you register only on the 2nd year, that’s
when contract bar starts until the 5 th year (in
effect 4 years lang)
 On the first year, you are subject to
challenge. If you never register the CBA,
there’s no freedom period. You can be
subject to challenge anytime.
5-year period NOT automatically renewed if no CBA.
Freedom period starts either:
a) On the 5th year of the expiration of the first,
OR
b) On the 5th year of the NEW CBA, if a CBA
was entered into, WHICHEVER COMES
FIRST.
“All other provisions of the Collective Bargaining
Agreement shall be renegotiated not later than three
(3) years after its execution.”
 “All other provisions” – economic provisions
and grievance machinery. Basically anything
other than the representation aspect.
 3 year period for re-negotiation of economic
aspect
 3 years is not a period but a deadline. How
does that work?
o On the first/second year of the CBA, the
union proposed modifications. Can
management refuse? Yes. It’s too early.
There’s no refusal to bargain.
o management cannot be compelled to
renegotiate prior to 3 year period
 Refusal to renegotiate = ULP. The SC has
extended the application of the Kiok Loy
doctrine to renegotiation. Hence, in cases
where there is a refusal to renegotiate, the
NLRC can impose the proposed
modifications.
55
Let’s say the parties agreed on a 5-year CBA. Even if
the CBA is set for 5 years, the parties are required to
sit down and renegotiate not later than 3 years from
the start of the CBA. The reason is to give the parties
the opportunity to adjust the provisions of the existing
CBA to economic social realities which they may not
have anticipated 3 years ago.
60-day period to negotiate vs. not later than 3 years
for renegotiate
 3 year deadline refers to renegotiating of
existing CBA
 60-day period to negotiate refers to a new
CBA or extension of the existing one.
Refusal to negotiate = ULP = proposed CBA
is new CBA
Retroactivity
Any agreement on such other provisions of the
Collective Bargaining Agreement entered into within
six (6) months from the date of expiry of the term of
such other provisions as fixed in such Collective
Bargaining Agreement, shall retroact to the day
immediately following such date. If any such
agreement is entered into beyond six months, the
parties shall agree on the duration of retroactivity
thereof. In case of a deadlock in the renegotiation of
the Collective Bargaining Agreement, the parties may
exercise their rights under this Code.
So if the old CBA expired on December 31, 2020, and
today, June 11, 2021 the parties have reached an
agreement. It need not even be the formal signing.
What’s important is that there was meeting of the
minds. Since it’s June 11, we are still within the 6
months. As such, by law, the new CBA will start
January 1 of 2021. This is mandatory. The parties
cannot stipulate otherwise.
What is the effect of retroactivity? You can imagine 2
CBAs overlapping when you relate the retroactivity
principle to the holdover principle. Remember, it shall
be the duty of both parties to continue in full force and
effect the terms and conditions of the existing
agreement until a new one is reached by the parties.
So what’s the implication? The wages of employees,
including other labor standard benefits (OT pay,
holiday pay etc) from January 1 to June 10 was based
on the old CBA. But because of retroactivity, the new
CBA should have been followed and therefore there
exists differentials. So there will be a recomputation
based on the provisions of the new CBA, assuming
the new CBA provides for higher benefits.
2nd situation: the CBA was entered into in August,
2021 – beyond 6 months. There will be no automatic
retroactivity. There can be, if the parties agreed.
Otherwise, the CBA will have prospective application.
SUBSTITUTIONARY DOCTRINE – in cases where
a new CBA was entered into while the certification
election proceedings are ongoing, the new SEBA
must still be bound by the CBA that was properly
negotiated between the management and the
previous SEBA. The agreement is between the
BARGAINING UNIT and the management. The SEBA
is only an agent. This is based on the principle of
AGENCY. As long as the agent is clothed with
authority to enter into transaction at the time the
transaction was entered into then the principal cannot
deny the transaction by simply changing the agent.
 The new SEBA can only negotiate for the
shortening of the term of the old CBA.
SONEDCO vs URC (2016): SEBA may negotiate for a
new CBA. The CBA entered into while the certification
election proceedings were ongoing is just an interim
CBA.
 However, this does not abandon the
substitutionary doctrine since there was no
mention thereof.
 So in the bar, answer by first discussing the
substitutionary doctrine and then mention
SONEDCO.
CBA deadlock
“In case of a deadlock in the renegotiation of the
Collective Bargaining Agreement, the parties may
exercise their rights under this Code.”
There is a deadlock in collective bargaining where
there is failure in the collective bargaining negotiations
between the SEBA and the employer resulting in an
impasse or stalemate on all or some of the issues
subject of the negotiation.
 The filing of a notice of strike/lockout by the
SEBA or the employer, respectively, signals the
formal declaration of a CBA deadlock.
Rights of parties in case of a deadlock:
1) Submission of the deadlocked issue to
conciliation and mediation by the NCMB;
2) Declaration and actual staging of a strike by the
union or lockout by the employer;
3) Referral of case to compulsory or voluntary
arbitration;
4) In case of industries indispensable to the national
interest, filing of petition for assumption of
jurisdiction over the labor dispute or certification
thereof to the NLRC for compulsory arbitration.
ARTICLE 237. [231] Registry of Unions and File of
Collective Bargaining Agreements. —
Within thirty (30) days from the execution of a
Collective Bargaining Agreement, the parties shall
submit copies of the same directly to the Bureau or
the Regional Offices of the Department of Labor and
Employment for registration accompanied with verified
proofs of its posting in two conspicuous places in
the place of work and ratification by the majority of
all the workers in the bargaining unit.
56
The Bureau or Regional Offices shall act upon the
application for registration of such Collective
Bargaining Agreement within five (5) calendar days
from receipt thereof. The Regional Offices shall
furnish the Bureau with a copy of the Collective
Bargaining Agreement within five (5) days from its
submission.
The Bureau or Regional Office shall assess the
employer for every Collective Bargaining Agreement a
registration fee of not less than one thousand pesos
(P1,000.00) or in any other amount as may be
deemed appropriate and necessary by the Secretary
of Labor and Employment for the effective and
efficient administration of the Voluntary Arbitration
Program. Any amount collected under this provision
shall accrue to the Special Voluntary Arbitration Fund.
The Bureau shall also maintain a file, and shall
undertake or assist in the publication of all final
decisions, orders and awards of the Secretary of
Labor and Employment, Regional Directors and the
Commission.
ARTICLE 228. [222] Appearances and Fees. —
(b) No attorney's fees, negotiation fees or similar
charges of any kind arising from any collective
bargaining agreement shall be imposed on any
individual member of the contracting union: Provided,
However, that attorney's fees may be charged against
union funds in an amount to be agreed upon by the
parties. Any contract, agreement or arrangement of
any sort to the contrary shall be null and void.
Mandatory Provisions in a CBA
Matters considered as mandatory subjects of
bargaining
1. Grievance Machinery
 a machinery for the adjustment and
resolution of grievances arising from the
interpretation or implementation of their
CBA and those arising from the
interpretation or enforcement of company
personnel policies.
 violations of a CBA, except those which are
gross in character, shall no longer be treated
as unfair labor practice and shall be resolved
as grievances under the CBA. For purposes
of this article, gross violations of CBA shall
mean flagrant and/or malicious refusal to
comply with the economic provisions of such
agreement.
 The distinction here is important because
ULP is a ground for a strike; a grievance is
not.
2. Voluntary Arbitration
 All grievances submitted to the grievance
machinery which are not settled within seven
(7) calendar days from the date of its
submission shall automatically be referred to
voluntary arbitration prescribed in the
Collective Bargaining Agreement.
  Voluntary arbitrator must either be
mentioned in the CBA or manner of selection
thereof must be stipulated in the CBA
3. No Strike-No Lockout Clause
4. Labor Management Council (Labor Code, Art.
267)
5. Union Security Arrangements
6. Economic / Working Conditions
a) Wages and other types of compensation;
including merit increases;
b) Working hours and working days, including
work shifts;
c) Vacations and holidays;
d) Bonuses;
e) Pensions and retirement plans;
f) Seniority;
g) Transfer;
h) Lay-offs;
i) Employee workloads;
j) Work rules and regulations;
k) Rent of company houses;
l) Family planning;
m) Rates of pay;
n) Mutual observance duties; and
These subjects are those that the parties are
compulsorily required to bargain if either party has
made a proposal thereon. Thus, an employer may not
introduce any changes in the mandatory bargaining
subjects without providing the SEBA prior notice of
such proposed changes and affording it the
opportunity to bargain thereover.
Mandatory Provisions
1. Provision against Drug Use in Workplace (drug-
free workplace policy);
2. Provision on HIV/AIDS education and information
program
Employees entitled to CBA benefits
1) Members of the SEBA;
2) Non-SEBA members but are covered by the
collective bargaining unit;
3) Members of the minority union/s who paid agency
fees to the SEBA;
4) New employees hired after the conclusion of the
CBA and during its effectivity or even after its
expiration.
Entitlement of excluded employees
Employees excluded from the collective bargaining
unit, like confidential employees or managerial
employees, as a general rule, are not entitled to the
benefits flowing from the CBA.
Exceptions:
1) When the CBA benefits are granted to
managerial employees by reason of company
practice;
2) When adjustments are made to avoid distortion in
the levels of wages or benefits.
57
E. UNFAIR LABOR PRACTICES
1. Nature, aspects
ULP pertains to interference with the exercise of the
right to self-organization, violation of the right and
duty to collectively bargain, and the right to strike.
The act complained of as ULP must have a proximate
and casual connection with the following:
1) Exercise of the right to self-organization;
2) Exercise of the right to collective bargaining; or
3) Compliance with the CBA.
Sans this connection, the unfair acts do not fall within
the technical term unfair labor practice.
The only exception is the act described under
paragraph f or to dismiss or discharge an employee
for having given testimony.
Elements:
1) There should exist an ER-EE relationship
between the offended party and the offender; and
2) The act complained of must be expressly
mentioned and defined in the Labor Code as
ULP.
For a charge of ULP to prosper, it must be shown that
the employer’s act was motivated by ill will, bad faith
or fraud, or was oppressive to labor, or done in a
manner contrary to morals, good customs, or public
policy, and that social humiliation, wounded feelings
or grave anxiety resulted therefrom.
Aspect
1) Civil aspect; and
2) Criminal aspect
ARTICLE 258. Concept of Unfair Labor Practice
and Procedure for Prosecution Thereof. — xxx
Unfair labor practices are not only violations of the
civil rights of both labor and management but are also
criminal offenses against the State which shall be
subject to prosecution and punishment as herein
provided.
[Civil Aspect]
Subject to the exercise by the President or by the
Secretary of Labor and Employment of the powers
vested in them by Articles 263 and 264 of this Code,
the civil aspects of all cases involving unfair labor
practices, which may include claims for actual, moral,
exemplary and other forms of damages, attorney's
fees and other affirmative relief, shall be under the
jurisdiction of the Labor Arbiters. The Labor Arbiters
shall give utmost priority to the hearing and resolution
of all cases involving unfair labor practices. They shall
resolve such cases within thirty (30) calendar days
from the time they are submitted for decision.
Recovery of civil liability in the administrative
proceedings shall bar recovery under the Civil Code.
[Criminal Aspect]
No criminal prosecution under this Title may be
instituted without a final judgment finding that an
unfair labor practice was committed having been first
obtained in the preceding paragraph. During the
pendency of such administrative proceeding, the
running of the period of prescription of the criminal
offense herein penalized shall be considered
interrupted: Provided, however, That the final
judgment in the administrative proceedings shall not
be binding in the criminal case nor be considered as
evidence of guilt but merely as proof of compliance of
the requirements therein set forth.
“administrative proceeding” – either a case for ULP
filed with the NLRC or a strike and an assumption of
jurisdiction by the Secretary and a finding that ULP
was indeed committed.
Note: the regular courts have jurisdiction for the
criminal cases.
2. By employers
ARTICLE 259. [248] Unfair Labor Practices of
Employers. — It shall be unlawful for an employer to
commit any of the following unfair labor practices:
ERC-FDD-VPV
a) Interference
To interfere with, restrain or coerce employees in
the exercise of their right to self-organization;
o It is not necessary that there be direct
evidence of interference. What matters is
that there is a reasonable inference that the
anti-union conduct of the employer does
have an adverse effect on the exercise of the
employee’s rights to self-organization and
collective bargaining.
o Totality of conduct doctrine – any perceived
act of interference must be examined in
terms of the act’s inherent import and effects,
in light of the surrounding circumstances,
and weighed on the basis of the totality of
the conduct of the entity charged.
b) Yellow Dog Contract
To require as a condition of employment that a
person or an employee shall not join a labor
organization or shall withdraw from one to which
he belongs;
o Such stipulation is null and void
c) Contracting out of services
To contract out services or functions being
performed by union members when such will
interfere with, restrain or coerce employees in the
exercise of their right to self-organization;
58
d) Company initiated, dominated, or assisted
union
To initiate, dominate, assist or otherwise interfere
with the formation or administration of any labor
organization, including the giving of financial or
other support to it or its organizers or supporters;
o NOTE: generally, the pendency of a ULP
case filed against a labor organization
participating in the certification election does
not stay the holding thereof. However, the
pendency of a formal charge of company
domination against one of the unions which
is participating in the certification election is a
prejudicial question that bars the holding
thereof until its final resolution.
o Rivera vs Espiritu: suspension of CBA to
prevent closure of PAL because of severe
financial losses (and therefore SEBA’s
incumbency prolonged) is not ULP; valid
exercise of freedom to contract.
e) Discrimination
To discriminate in regard to wages, hours of work
and other terms and conditions of employment in
order to encourage or discourage membership in
any labor organization.
Union Security Clause
Nothing in this Code or in any other law shall stop
the parties from requiring membership in a
recognized collective bargaining agent as a
condition for employment, except those
employees who are already members of another
union at the time of the signing of the collective
bargaining agreement. (notes below)
Agency Fee
Employees of an appropriate bargaining unit who
are not members of the recognized collective
bargaining agent may be assessed a reasonable
fee equivalent to the dues and other fees paid by
members of the recognized collective bargaining
agent, if such non-union members accept the
benefits under the collective bargaining
agreement: Provided, That the individual
authorization required under Article 250,
paragraph (o) of this Code shall not apply to the
non-members of the recognized collective
bargaining agent;
f) Discrimination for giving of testimony
To dismiss, discharge or otherwise prejudice or
discriminate against an employee for having
given or being about to give testimony under this
Code;
o This is the only ULP that need not be related
to or connected with the exercise by the
employees of their right to self-organization,
 collective bargaining or observance of the
CBA.
CBA-related ULPs:
g) To violate the duty to bargain collectively as
prescribed by this Code;
o To negotiate or attempt to negotiate with
individual workers rather than the SEBA is
ULP (unwarranted acts of interference)
o Surface bargaining – going through the
motions of negotiating without any legal
intent to reach an agreement. It is a form of
ULP that may only be committed by the
employer.
o Blue-sky bargaining – making exaggerated
or unreasonable proposals. This is a kind of
ULP which can only be committed by the
SEBA.
o Boulwarism – management opens the
negotiation with a generous offer that is not
meant to be negotiated. This “take it or leave
it” offer or counter-offer is considered as ULP
as essentially, no labor negotiation has taken
place.
h) To pay negotiation or attorney's fees to the union
or its officers or agents as part of the settlement
of any issue in collective bargaining or any other
dispute; or
o Art 228 requires that such atty’s fees,
negotiation fees or similar charges be paid
from the union funds. These fees cannot be
collected from the employees individually.
i) To violate a collective bargaining agreement.
o To constitute as ULP, the violation of the
CBA must be a flagrant and/or malicious
refusal to comply with the economic
provisions of the CBA. Jurisdiction therefor
properly belongs to the Labor Arbiter.
o Hence, if it’s a non-economic provision, or
even if an economic provision but the
violation is not gross in character, the
violation should be resolved merely as
ordinary grievances cognizable under the
grievance machinery and voluntary
arbitration clause of the CBA. Further, not
being an act of ULP, it is not the proper
subject of a strike.
The provisions of the preceding paragraph
notwithstanding, only the officers and agents of
corporations, associations or partnerships who have
actually participated in, authorized or ratified unfair
labor practices shall be held criminally liable.
Union Busting (Article 278 [c])
However, in case of dismissal from employment of
union officers duly elected in accordance with the
union constitution and by-laws, which may constitute
union busting where the existence of the union is
59
threatened, the 15-day cooling-off period shall not
apply and the union may take action immediately.
Union Security Clause (par e)
Union security is a generic term, which is applied to
and comprehends closed shop, union shop,
maintenance of membership, or any other form of
agreement which imposes upon employees the
obligation to acquire or retain union membership as a
condition affecting employment.
- There is union shop when all new regular
employees are required to join the union within a
certain period as a condition for their continued
employment.
 it goes into the hiring of new employees.
Membership is required upon regularization
within a certain period of time, otherwise,
they may be terminated
- There is maintenance of membership shop
when employees, who are union members as of
the effective date of the agreement, or who
thereafter become members, must maintain
union membership as a condition for continued
employment until they are promoted or
transferred out of the bargaining unit or the
agreement is terminated
 consequence of violation: DISMISSAL – in
case of resignation or expulsion from the
Union.
 covers those who are existing members and
those who become members afterwards.
Note: You are not compelled to join if you are
not a member
- A closed shop, on the other hand, may be
defined as an enterprise in which, by agreement
between the employer and his employees or their
representatives, no person may be employed in
any or certain agreed departments of the
enterprise unless he or she is, becomes, and, for
the duration of the agreement, remains a member
in good standing of a union entirely comprised of
or of which the employees in interest are a part.
Violation of the union security clause, to be a valid
basis for dismissal, must be expressly stated in the
CBA that dismissal is the consequence. A dismissal
founded on this clause which does not explicitly
authorize it for its violation constitutes ULP.
But in cases where termination of employment is
expressly stipulated therein as the end-result of such
refusal to join the SEBA or loss of membership status,
the SEBA has to back up its recommendation to the
employer to terminate a member-employee’s
employment with just and valid grounds.
3 common grounds usually invoked by the SEBA: a)
refusal to become members of SEBA; b) resignation
from union; c) expulsion.
In terminating the employment of an employee by
enforcing the union security clause, the employer
needs only to determine and prove that:
1. the union security clause is applicable;
2. the union is requesting for the enforcement
of the union security provision in the CBA;
and
3. there is sufficient evidence to support the
decision of the union to expel the employee
from the union.
o Employer must therefore conduct its
own inquiry and independent hearing on
the factual and legal bases of the
demand for theismisssal of the
employee.
o Must still comply with the twin-notice
rule
These requisites constitute just cause for terminating
an employee based on the union security provision of
the CBA.
The employer and the union are solidarily liable for
reinstatement, backwages, damages and other
monetary claims in cases of illegal dismissal arsing
from purported violation of the union security clause.
Exclusions
1. Religious objectors; however, they cannot be
considered as ineligible to join a Union.
There is no legal prohibition;
2. Employees already in the service and
already members of a union other than the
SEBA at the time the union security
agreement took effect;
3. Confidential employees who are excluded
from the rank-and-file or supervisory
bargaining unit;
4. Employees excluded from the coverage of
the union security cluse per express and
mutual agreement of the parties as stipulated
in the CBA.
Remember: the rule now under Art 274 is that only
gross violations of the economic provisions of the
CBA are treated as ULP. Otherwise, they are mere
grievances. Thus, the alleged violation of the union
shop agreement in the CBA by the employer, even
assuming it was malicious and flagrant, is not a
violation of an economic provision in the agreement
and therefore not an unfair labor practice.
3. By labor organizations
ARTICLE 260. [249] Unfair Labor Practices of Labor
Organizations. — It shall be unfair labor practice for a
labor organization, its officers, agents or
representatives:
a) To restrain or coerce employees in the exercise
of their right to self-organization. However, a
labor organization shall have the right to
prescribe its own rules with respect to the
acquisition or retention of membership;
60
o Note the absence of interference among the
prohibitions because the law gives the union
the license to interfere with the employee’s
right to self-organization because without it,
no labor organization can be formed as the
act of recruiting and convincing employees to
join it is an act of interference.
b) To cause or attempt to cause an employer to
discriminate against an employee, including
discrimination (by the union) against an employee
with respect to whom membership in such
organization has been denied or to terminate an
employee on any ground other than the usual
terms and conditions under which membership or
continuation of membership is made available to
other members;
o Thus, this paragraph treats as ULP three
acts: 1) cause an employer to discriminate
against an employee; 2) discriminatorily
denying membership to an employee; 3)
discriminatorily terminating the union
employee from membership in the union.
c) To violate the duty, or refuse to bargain
collectively with the employer, provided it is the
representative of the employees;
o Duty of fair representation – as a duly
certified SEBA, the union has the duty and
responsibility to represent all the employees
in the CBU equally and fairly, irrespective of
whether they are members or not.
d) To cause or attempt to cause an employer to pay
or deliver or agree to pay or deliver any money or
other things of value, in the nature of an exaction,
for services which are not performed or not to be
performed, including the demand for fee for union
negotiations;
o Featherbedding or make-work – refers to the
practice, caused and induced by a union, of
hiring more workers than needed to perform
a given work, job, or task or to adopt work
procedures which is evidently senseless,
wasteful, and without legitimate justifications
since it is meant purely for the purposes of
employing additional workers than
necessary.
e) To ask for or accept negotiation or attorney's fees
from employers as part of the settlement of any
issue in collective bargaining or any other
dispute; or
f) To violate a collective bargaining agreement.
The provisions of the preceding paragraph
notwithstanding, only the officers, members of
governing boards, representatives or agents or
members of labor associations or organizations who
have actually participated in, authorized or ratified
unfair labor practices shall be held criminally liable.
61
 WHAT CONSTITUTES A “STRIKE”?
Strike – any temporary stoppage of work by the
concerted action of employees as a result of an
industrial or labor dispute. (Art 219 (o))
 Concerted action – one undertaken by 2 or
more employees or by 1 on behalf of the
others
 Labor dispute - includes any controversy or
matter concerning the terms or conditions of
employment or the association or
representation of persons in negotiating, fixing,
maintaining, changing or arranging the terms
and conditions of employment, regardless of
whether the disputants stand in the proximate
relation of employer and employee. (Bukluran
ng Manggagawa v. CA)
From the definition, there are 3 components:
1. Stoppage
2. Concerted action
3. labor dispute.
Q: Strike because they are demanding for covid
vaccines. Employees were complaining because
of the absence of covid vaccine program for them
thus stopped from working. Not a strike because of
lack of labor dispute; it was merely a redress of
grievance against govt. So if there’s a call from the
Trade Union, calling on its members to stop reporting
to work and join them in protesting against the govt,
statutorily speaking it is not a strike. HOWEVER,
jurisprudence says otherwise. (Biflex)
Jurisprudence is confusing:
 The term "strike" has been elucidated to
encompass not only concerted work stoppages,
but also slowdowns, mass leaves, sit-downs,
attempts to damage, destroy, or sabotage plant
equipment and facilities, and overtime boycott.
o Work slowdown is a strike on installment
plan; it involves a willful reduction in the rate
of work by the concerted action of the
workers for the purpose of restricting the
output of the employer, in relation to a labor
dispute.
 Examples of strikes accdng to jurisprudence:
a) Employees who have no labor dispute with
their employer but who, on a day they are
scheduled to work, refuse to work and
instead join a welga ng bayan (Biflex v
Filflex)
b) While there are no work stoppages, the
pickets and concerted actions outside the
plants have a demoralizing and even chilling
effect on the workers inside the plants and
can be considered as veiled threats of
possible trouble to the workers when they go
out of the company premises after work and
of impending disruption of operations to
company officials and even to customers in
the days to come. The pictures presented by
Toyota undoubtedly show that the company
62
officials and employees are being intimidated
and threatened by the strikers. (Toyota Motor
Phils. Corp. Workers Association (TMPCWA)
v. NLRC, Toyota Motor Philippines
Corporation)
c) Sporting closely cropped hair or cleanly
shaven heads in a Hotel in contravention of
the Hotel’s policy (NUHWRAIN Dusit Hotel v.
CA)
d) Even absences on successive holidays had
been considered a strike (A. Soriano Aviation
v. Employees Association of A. Soriano)
e) union officers instigated a few employees to
be absent from work. The SC said this was a
concerted activity that amounted to strike.
(Ramirez v. Polyson Industries, October 19,
2016)
Manuel: stoppage of work need not be by the strikers
themselves nor does it need to be done in the work
premises. There’s an old case where the strikers
simply stopped a truck carrying supplies for the
company and the court held it was a strike.
SO HOW DO WE DETERMINE WON THERE IS A
STRIKE?
The determination of WON there is a strike is based
on the deprivation of the employer of the benefit
of these employees.
 So the moment that the employees decide to stop
rendering work to the employer, then that is the
significant event that we are considering a strike,
regardless of whether or not it paralyzes the
operations of the employer.
Definition of terms
 Economic strike – strike grounded on bargaining
deadlock;
 Political strike – strike grounded on ULP;
 Wildcat strike/outlaw strike/quickie strike – one
declared and staged without the majority
approval of the certified bargaining agent.
o It is a spontaneous or unannounced illegal
concerted action by a section or group of
employees without the sanction or
authorization of the union or in violation of
the union’s constitution and by0laws or
without following the proper procedure for
striking such as majority approval through
union balloting.
 Sympathy strike – a strike where the strikers
have no demands or grievances or labor dispute
of their own against their employer but
nonetheless stage the strike for the purpose of
aiding, directly or indirectly, other strikers in other
establishments or companies, without necessarily
having any direct relation to the advancement of
the strikers’ interest.
o This is patently an illegal strike
o Ex: welga ng bayan
Strike by dismissed employees
While there are no work stoppages, the pickets and
concerted actions outside the plants have a
demoralizing and even chilling effect on the workers
inside the plants and can be considered as veiled
threats of possible trouble to the workers when they
go out of the company premises after work and of
impending disruption of operations to company
officials and even to customers in the days to come.
The pictures presented by Toyota undoubtedly show
that the company officials and employees are being
intimidated and threatened by the strikers. In short,
the Union, by its mass actions, has inflamed an
already volatile situation, which was explicitly
proscribed by the DOLE Secretary’s Order. Thus, the
pickers were unlawful strikes (Toyota vs NLRC)
Picketing – act of marching to and fro the employer’s
premises, usually accompanied by the display of
placards and other signs making known the facts
involved in a labor dispute. This is an exercise of
one’s freedom of speech.
 Right to picket is part of the constitutionally
guaranteed freedom of speech and expression
 Picketing, if lawfully carried out, cannot be
prohibited even in the absence of employer-
employee relationship between the picketers and
the employer being picketed.
Limitations
Innocent Bystander Rule
The strikers staging the picket cannot rightfully
prevent employees of another company which is not
their employer, from getting in and out of its rented
premises since this will violate the right of innocent
bystanders. Such employer is considered an innocent
bystander who has no employer-employee
relationship with the picketing strikers and thus may
file for an injunctive relief with the regular courts to
enjoin the conduct of the picket.
 The NLRC has no jurisdiction to issue the
injunction because of the absence of ER-EE
relationsip.
Nuisance
A picketing which is conducted as to amount to a
nuisance is unlawful.
It is thus an act of nuisance where the obstruction to
the free use of property substantially interferes with
the comfortable enjoyment of life or property or where
the picketing constitutes an unlawful obstruction to the
free passage or use, in the customary manner, of a
street.
Picketing and strike are two forms of concerted
activity. In strike it is required that there be a
stoppage of work. In picketing, it can be done without
a stoppage. A strike focuses on stoppage of work,
picketing focuses on publicizing the labor dispute and
its incidents to inform the public of what is happening
in the company struck against.
63
 In distinguishing between a picket and a
strike, the totality of the circumstances
obtaining in a case should be taken into
account.
Do not combine the two (strike and picketing)
- Legality (notice requirements, etc) apply to
strikes.
- The only requirement to make picketing valid
and legal is that it should be peacefully
conducted.
For picketing to be considered a strike:
 Situation: There was a labor dispute, and the
employees were peacefully picketing. No
strike yet. But this morning, there was an
incident that caused a commotion. Because
of the commotion, the employees were
prevented from entering their place of work. Is
there a stoppage of work? Is it a strike? No.
While there was stoppage because of the
commotion it was not a strike. There must be a
concurrence of the stoppage and the concerted
activity, meaning the cause of the stoppage
should be the concerted activity, in this case, the
picketing, and not just the act of a single person.
 Do we distinguish on the type and number of
employees for purposes of ‘stoppage of work’
? No.
WHO MAY DECLARE A STRIKE?
Art 278, (c) In case of bargaining deadlocks, the
duly certified or recognized bargaining agent may
file a notice of strike or the employer may file a
notice of lockout with the Ministry at least 30 days
before the intended date thereof. In cases of unfair
labor practice, the period of notice shall be 15 days
and in the absence of a duly certified or recognized
bargaining agent, the notice of strike may be filed
by any legitimate labor organization in behalf of its
members.
Rule XXII, Section 6. Who may declare a strike
or lockout. – Any certified or duly recognized
bargaining representative may declare a strike in
cases of bargaining deadlocks and unfair labor
practices. The employer may declare a lockout in
the same cases.
In the absence of a certified or duly recognized
bargaining representative, any legitimate labor
organization in the establishment may declare a
strike but only on grounds of unfair labor practices.
Remember that it is only the SEBA can declare a
deadlock and can act on a deadlock by filing a notice
of strike. A deadlock could only happen if there was
bargaining between a SEBA and management.
The issue now is on the situation where you have
ULP but there is a SEBA. In those cases, still, only the
SEBA can file. It is only in cases where there is no
SEBA can another union file a notice of strike.
 Therefore there can be a situation where the
SEBA and the employer connives in the
commission of a ULP against a union but the
union cannot go on strike. The remedy here is
confined to filing a case for ULP, but not to go on
strike.
Note: for strikes, the federation cannot file a notice of
strike on behalf of the local chapter or an affiliated
union, unlike in petitions for certification election. Only
the local chapter or the union can.
WHAT ARE THE REQUIREMENTS OF A VALID
STRIKE?
1. The strike must be justified on grounds
allowed by law (ULP or bargaining deadlock);
2. A notice of strike must be filed by the SEBA
with the NCMB-DOLE at least 30 days before
the intended strike, if based on bargaining
deadlock, or at least 15 days if based on ULP.
In the absence of a SEBA, any legitimate
labor organization in the establishment may
file the notice if the ground is ULP; (Cooling-
off period)
3. A notice of strike vote must be filed at least 24
hours before the conduct of the strike vote;
4. A notice of the results of the strike vote must
be filed at least 7 days before the intended
strike. (7-day strike ban)
Justifiable Grounds
Fundamental Requirement - grounds to
conduct a strike:
1) Collective bargaining deadlock
 "the situation between the labor and
the management of the company
where there is failure in the collective
bargaining negotiations resulting in a
stalemate"
2) A ULP must have happened
Art 278 (b): xxx However, no labor union may
strike and no employer may declare a lockout on
grounds involving inter-union and intra-union
disputes.
Art 279 (b): No strike or lockout shall be declared
after assumption of jurisdiction by the President or
the Minister or after certification or submission of
the dispute to compulsory or voluntary arbitration
or during the pendency of cases involving the
same grounds for the strike or lockout.
Rule XXII, Section 5. Grounds for strike or lockout.
— A strike or lockout may be declared in cases of
bargaining deadlocks and unfair labor practices.
Violations of collective bargaining agreements,
except flagrant and/or malicious refusal to comply
with its economic provisions, shall not be
64
considered unfair labor practice and shall not be
strikeable. No strike or lockout may be declared on
grounds involving inter-union and intra-union
disputes or without first having filed a notice of
strike or lockout or without the necessary strike or
lockout vote having been obtained and reported to
the Board. Neither will a strike be declared after
assumption of jurisdiction by the Secretary or after
certification or submission of the dispute to
compulsory or voluntary arbitration or during the
pendency of cases involving the same grounds for
the strike or lockout.
Good faith doctrine
A strike based on ULP does not automatically carry
the stigma of illegality even if no ULP was actually
committed by the employer for as long as the strikers
believed in good faith that such ULP was indeed
committed. Indeed, the presumption of legality
prevails even if the allegation of ULP is subsequently
found to be untrue provided that the union and its
members believed in good faith in the truth of such
averment.
Deadlock
How different is a deadlock from refusal to
bargain?
 Deadlock – presupposes that there were
negotiations, but they failed to reach an
agreement
 Refusal to bargain – no negotiations
whatsoever; amounts to an unfair labor practice
and so a different ground for strike.
How different is a deadlock from bargaining in
bad faith?
 Bargaining in bad faith – Negotiating, but done
in bad faith; same consequence as refusal to
bargain. Violation of the duty to bargain
collectively. It is a ULP = Ground for a strike.
So note: deadlock could be the result of genuine,
good faith negotiations. The deadlock itself is not an
unlawful action on the part of the employer. Deadlock
is simply a result of bargaining, but did not produce a
CBA. So it is not unlawful, but is a ground for strike.
The ff grounds are non-strikeable and therefore
invalid:
1) Inter-union or intra-union disputes;
2) Simple violation of the CBA which are not gross
in character;
3) Violation of labor standards
o Enforcement of labor standard provisions
and resolution of issues arising therefrom are
governed by the visitorial and enforcement
powers of the Secretary of Labor under Art
129;
4) Wage distortion
 o Resolved through the grievance machinery
for organized establishments, and the NCMB
for unorganized establishments.

65
 NOTICES
Notice of Strike Notice of Strike
(Cooling off period) Article 278. (c) In case of bargaining deadlocks,
 When: at least 30 Purpose: During the the duly certified or recognized bargaining agent
days before the cooling-off period, it may file a notice of strike or the employer may file
intended strike, if shall be the duty of the a notice of lockout with the Ministry at least 30 day
based on Ministry to exert all before the intended date thereof. In cases of unfair
bargaining efforts at mediation and labor practice, the period of notice shall be 15 days
deadlock, or at conciliation to effect a and in the absence of a duly certified or recognized
least 15 days if voluntary settlement. bargaining agent, the notice of strike may be filed
based on ULP.  Should the dispute by any legitimate labor organization in behalf of its
 Existence of union remain unsettled members.
busting: 15-day until the lapse of
cooling off period the requisite [UNION BUSTING]: However, in case of dismissal
period not number of days from employment of union officers duly elected in
applicable; union from the mandatory accordance with the union constitution and by-
may take action filing of the notice, laws, which may constitute union busting, where
immediately. the labor union the existence of the union is threatened, the 15-day
 Who: SEBA. In the may strike or the cooling-off period shall not apply and the union
absence of a employer may may take action immediately.
SEBA, any declare a lockout.
legitimate labor (d) The notice must be in accordance with such
organization in the implementing rules and regulations as the Minister
establishment may of Labor and Employment may promulgate.
file the notice if the
ground is ULP
 Where: regional (e) During the cooling-off period, it shall be the duty
office of the DOLE of the Ministry to exert all efforts at mediation and
having jurisdiction conciliation to effect a voluntary settlement. Should
over the working the dispute remain unsettled until the lapse of the
place requisite number of days from the mandatory filing
of the notice, the labor union may strike or the
Notice of Conduct of Strike Vote employer may declare a lockout.
 at least 24 hours Purpose: DOLE may, at
before the intended its own initiative or upon Q: When can the notice of strike be filed? ANYTIME.
strike vote. the request of any - To clarify, because as worded, the law seems to
 A decision to affected party, suggest that the union must first determine the
declare a strike supervise the conduct date of actual strike, and then after determining
must be approved of the secret balloting. such date, count back either 30 or 15 days, then
by a majority of the (so to give time to file a notice of strike. THAT IS NOT THE CASE.
total union DOLE to decide if it will - For practical purposes, you don’t count back.
membership in the supervise secret There’s no such requirement. Instead, you count
bargaining unit balloting) prospectively, meaning file your notice of strike
concerned then make sure that from that day (when you filed
 Vote must be your notice of strike) count 30 or 15.
obtained by secret
ballot in meetings Q: What is the effect of conciliation after cooling off
or referenda called period?
for that purpose - Union cannot strike. That is a strike conducted in
Notice of Results of Strike Vote bad faith, since you’re still negotiating.
(7-day strike ban) - While the cooling period is not the only time
 at least seven days Purpose: for the DOLE where conciliation could happen, the union could
before the intended to check the accuracy not conduct a strike if there are ongoing
strike or lockout of results as reported by conciliation conferences even beyond the cooling
the union and also an off period
opportunity for any - However, if you’re convinced that no conciliation
union member to assail is possible, you can conduct a strike. BUT you
the results. have to be clear in the conference that you would
no longer participate
- You have to be clear in the conciliation
conference (in the last) that you would no longer
agree to further discussions otherwise, if you

66
 agree, and you conduct a strike, its to be
considered a strike in bad faith.
Notice of Conduct of Strike Vote
(f) A decision to declare a strike must be approved
by a majority of the total union membership in the
bargaining unit concerned, obtained by secret
ballot in meetings or referenda called for that
purpose. A decision to declare a lockout must be
approved by a majority of the board of directors of
the corporation or association or of the partners in
a partnership, obtained by secret ballot in a
meeting called for that purpose. The decision shall
be valid for the duration of the dispute based on
substantially the same grounds considered when
the strike or lockout vote was taken. The Ministry
may, at its own initiative or upon the request of any
affected party, supervise the conduct of the secret
balloting. In every case, the union or the employer
shall furnish the Ministry the results of the voting at
least seven days before the intended strike or
lockout, subject to the cooling-off period herein
provided.
Note that the strike vote must be conducted through a
secret ballot. Otherwise, it is not a valid strike vote.
Note further that only union members will participate
in the strike vote. Those who are not union members
will not participate.
 This principle applies even when the strike is
based on bargaining deadlock and the issue
affects the entire bargaining unit.
 Strike vote is limited to the union members
REGARDLESS of the ground. Only the members
of the union who filed the notice of strike would
make a vote, since it is an internal process
(decision making) of the union.
Unlike the Notice of Strike, you count backwards.
Why? You must set your strike vote first before
you notify the DOLE. You do not notify DOLE
today if you are not prepared to conduct the strike
vote tomorrow.
Is there a deadline for the conduct of strike vote?
 There is no requirement for the strike vote to be
conducted during the cooling off period or
thereafter. The only requirement is before you
conduct the strike vote,you need to notify DOLE
24 hours before holding the same to allow the
DOLE to monitor the strike vote -- if necessary.
Manuel: what is meant by the term “subject to,”? if you
look at the provisions, they are independent of each
other but both will have the strike as the RECKONING
POINT. It just means that even if you have complied
with one, but not with the other, you cannot conduct
your strike
Notice of Results of Strike Vote
67
Is there a required period within which you should
submit the results?
 No provision requiring a union to submit
immediately the result.
 Can you submit it on the day of the strike vote?
YES. A week after, a month after, a year after,
YES. Again, there is no deadline.
 The only consequence is if you delay the
submission of the results, you delay the 7 day
period since it is counted from the time you
submitted your notice. So even if you conducted
it several months or last year, october 2020, but
until today you have not submitted the notice of
result, the 7 day period would not commence to
run.
Remember, it is sequential: you file the notice then
after filing, then you count 7 days.
Is the 7-day strike ban dispensed with when you have
union busting? NO.
- Union busting dispenses with the cooling off
period ONLY, not the 7-day strike ban.
- Ex. Even if it’s the highest officers that’s
dismissed, the union must still comply with the 7-
day strike ban
- That is the meaning of “in any case”
Effect on reckoning of 7-day strike ban if strike
vote is taken and reported within cooling-off
period:
The labor union may take a strike vote and report the
same to the NCMB-DOLE within the statutory cooling-
off period. However, in that case, the 7-day strike ban
should be counted not from the date of the
submission of the report but from the day
following the expiration of the cooling-off period.
(NCMB primer, citing NSFW vs Ovejera)
The language of the law leaves no room for doubt that
the cooling-off period and the seven-day strike ban
after the strike-vote report were intended to be
mandatory and therefore should be observed
separately and fully.
In other words, the 7 days should be added to
cooling-off period of 15 days, in case of ULP, or 30
days in case of bargaining deadlock and it is only after
the lapse of the total number of days after adding the
2 periods that the strike/lockout may be lawfully and
validly staged.
Ex:
 March 1 2017: Notice of strike grounded on ULP
was filed
 March 5 2017: strike vote was taken
 March 7: strike vote report was submitted to
NCMB-DOLE
When can the strike be held? March 24, 2017
 15-day cooling-off period was until March 16
 Add seven days of strike ban: March 23
 The union therefore can validly strike not on the
last day of the strike ban, but only a day
thereafter or on March 24, or any day after
March 24.
Manuel: this is wrong. The NSFW did not say that.
The Primer is also not legally binding. So long as both
the cooling off period and strike ban are followed, the
strike is valid. For purposes of the bar, cite both.
Conduct of Strike
Art 279, (e) No person engaged in picketing shall
commit any act of:
a) violence, coercion or intimidation or
b) obstruct the free ingress to or egress from
the employer’s premises for lawful
purposes, or
c) obstruct public thoroughfares.
ARTICLE 279. [264] Prohibited Activities. — (a)
No labor organization or employer shall declare a
strike or lockout:
1) without first having bargained collectively in
accordance with Title VII of this Book; or
2) without first having filed the notice required in
the preceding Article; or
3) without the necessary strike or lockout vote
first having been obtained and reported to the
Ministry.
No strike or lockout shall be declared after
assumption of jurisdiction by the President or the
Minister or after certification or submission of the
dispute to compulsory or voluntary arbitration or
during the pendency of cases involving the same
grounds for the strike or lockout.
Any worker whose employment has been
terminated as a consequence of any unlawful
lockout shall be entitled to reinstatement with full
backwages.
(b) No person shall obstruct, impede, or interfere
with by force, violence, coercion, threats or
intimidation, any peaceful picketing by employees
during any labor controversy or in the exercise of
the right to self-organization or collective
bargaining, or shall aid or abet such obstruction or
interference.
(c) No employer shall use or employ any strike-
breaker, nor shall any person be employed as a
strike-breaker.
 "Strike-breaker"  means any person who
obstructs, impedes, or interferes with by force,
violence, coercion, threats, or intimidation any
peaceful picketing affecting wages, hours or
conditions of work or in the exercise of the
right of self-organization or collective
bargaining.
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(d) No public official or employee, including officers
and personnel of the New Armed Forces of the
Philippines or the Integrated National Police, or
armed person, shall bring in, introduce or escort in
any manner, any individual who seeks to replace
strikers in entering or leaving the premises of a
strike area, or work in place of the strikers. The
police force shall keep out of the picket lines unless
actual violence or other criminal acts occur
therein: Provided, That nothing herein shall be
interpreted to prevent any public officer from taking
any measure necessary to maintain peace and
order, protect life and property, and/or enforce the
law and legal orders.
(e) No person engaged in picketing shall commit
any act of violence, coercion or intimidation or
obstruct the free ingress to or egress from the
employer's premises for lawful purposes, or
obstruct public thoroughfares.
Violation of these requirements may convert your
valid strike to an invalid one. So note that even if you
have a valid strike, meaning you complied with all the
requirements we discussed, it can still be an invalid
one.
a) Blocking of the ingress/egress:
while a strike is supposed to cause a stoppage of
work, our law prohibits the strikers from preventing
employees from entering and leaving the premises. In
fact, that is usually the cause of tension in strike
areas. When they see supplies or products being
delivered to the employers, it is very frustrating for
strikers to see that and that is when harassment from
both sides starts.
- Also related is the principle of pari delicto: where
both sides are guilty of violent acts during the
strike, they cancel each other’s faults so you
cannot hold the employees liable for an invalid
strike. So quits.
- Q: for pari delicto to apply, must the violence
employed by the employer be pervasive as well?
YES. It must be commensurate. Pari delicto nga
eh. (SC did not clarify; Manuel’s opinion)
b) For violence, in order to consider the strike as
illegal, the violence must be pervasive – adopted by
the strikers as a strategy. Isolated acts of violence will
not convert a valid strike to an invalid one.
Strike in hospitals, clinics, and medical
institutions
Art 278: In line with the national concern for and
the highest respect accorded to the right of patients
to life and health, strikes and lockouts in hospitals,
clinics and similar medical institutions shall, to
every extent possible, be avoided, and all serious
efforts, not only by labor and management but
government as well, be exhausted to substantially
 minimize, if not prevent, their adverse effects on
such life and health, through the exercise, however
legitimate, by labor of its right to strike and by
management to lockout.
In labor disputes adversely affecting the continued
operation of such hospitals, clinics or medical
institutions, it shall be the duty of the striking union
or locking-out employer to provide and maintain an
effective skeletal workforce of medical and other
health personnel, whose movement and services
shall be unhampered and unrestricted, as are
necessary to insure the proper and adequate
protection of the life and health of its patients, most
especially emergency cases, for the duration of the
strike or lockout.
In such cases, therefore, the Secretary of Labor
and Employment may immediately assume, within
twenty four (24) hours from knowledge of the
occurrence of such a strike or lockout, jurisdiction
over the same or certify it to the Commission for
compulsory arbitration. For this purpose, the
contending parties are strictly enjoined to comply
with such orders, prohibitions and/or injunctions as
are issued by the Secretary of Labor and
Employment or the Commission, under pain of
immediate disciplinary action, including
dismissal or loss of employment status or payment
by the locking-out employer of backwages,
damages and other affirmative relief, even
criminal prosecution against either or both of
them.
Strike in the government service
The Labor Code classifies employees in the
government sector as follows:
1) Employees of GOCCs organized under the
Corporation Code (w/o original charters) are
covered by the Labor Code;
o Hence, employees therein possess and
enjoy the right to self-organization and to
strike just like any employee in the private
sector.
2) Employees of the govt and its political
subdivisions or instrumentalities, including
GOCCs with original charters are covered by the
Civil Service Law.
o Hence, they possess and enjoy only the right
to self-organization but not the right to strike.
o In govt employment, it is the legislature and
in appropriate cases the heads of admin
agencies which fix the terms and conditions
of employment through statues and circulars,
not through bargaining agreements.
o Their remedy, therefore, is to either petition
the Congress or negotiate with the
appropriate govt agencies for the benefits
which are not fixed by law.
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o If there be any unresolved grievances, the
dispute may be referred to the Public Sector-
Labor Management Council.
ILLEGAL STRIKE
Six (6) categories of an illegal strike, viz:
1. [when it] is contrary to a specific prohibition of
law, such as strike by employees performing
governmental functions; or
2. [when it] is declared for an unlawful purpose; or
o Eg strike staged for the purpose of
demanding the dismissal of an employee,
SEBA recognition, etc.
3. [when it] violates a specific requirement of law,
such as Article 278 of the Labor Code on the
requisites of a valid strike; or
4. [when it] is declared in violation of an existing
injunction, such as injunction, prohibition, or order
issued by the DOLE Secretary and the NLRC
under Art. 278 of the Labor Code; or
5. [when it] is contrary to an existing agreement,
such as a no-strike clause or conclusive
arbitration clause; or
o This clause may be invoked by an employer
only when the strike is economic in nature, or
which is conducted to forge wage or other
concessions from the employer that are not
mandated to be granted by the law itself. It
does not bar strikes grounded on ULP.
6. [when it] employs unlawful means in the pursuit
of its objective, such as a widespread terrorism of
non-strikers, for example, prohibited acts under
Art. 279 (e) of the Labor Code; or
Consequences of an illegal strike
Art 279, (c). Any worker whose employment has
been terminated as a consequence of any unlawful
lockout shall be entitled to reinstatement with full
backwages.
Any union officer who knowingly participates in an
illegal strike and any worker or union officer who
knowingly participates in the commission of illegal
acts during a strike may be declared to have lost
his employment status: Provided, That mere
participation of a worker in a lawful strike shall not
constitute sufficient ground for termination of his
employment, even if a replacement had been hired
by the employer during such lawful strike.
Article 281, Requirement for arrest and detention.
- Except on grounds of national security and public
peace or in case of commission of a crime, no
union members or union organizers may be
arrested or detained for union activities without
previous consultations with the Secretary of Labor.
Consequences of illegal Strike
The employment relationship is merely suspended
during the period of work stoppage. Generally, there
can be no wholesale/mass dismissal of strikers
because of a declaration that the strike is illegal. (Art
279 [c])
Even if the strike started as a lawful strike, if in the
course thereof, illegal acts are committed by the
strikers, the strike becomes illegal and the participants
in the commission thereof become liable and may
thus be terminated. This holds true whether the striker
guilty of committing illegal acts is an officer or an
ordinary member.
Union Officers
The mere finding or declaration of illegality of the
strike will result in the termination of all union officers
who knowingly participated in the illegal strike.
Ordinary union members
Mere participation in an illegal strike is not a sufficient
ground to terminate their employment, even if he
voted for the holding of a strike which became illegal.
Otherwise, the employer would be liable for illegal
dismissal.
For a union member to suffer the consequence of loss
of employment, it must be shown by substantial
evidence that he knowingly participated in the
commission of illegal acts during the strike.
 In this case, liability should be determined on an
individual basis. For this purpose, the individual
identity of the union member who participated in
the illegal act must not only be proved but the
specific illegal acts he committed should be
described with particularity.
Illegal Acts
a) any act of violence, coercion or intimidation, or
obstructing the free ingress to or egress from the
employer’s premises for lawful purposes, or
obstructing public thoroughfares;
b) Commission of crimes and other unlawful acts in
carrying out the strike;
c) Violation of any prohibition, order, or injunction by
the DOLE Secretary or NLRC in connection with
the assumption order of jurisdiction or certification
order.
Note: enumeration not exclusive.
Liability for illegal strike vs liability for defiance of
assumption order
While the former makes a clear-cut distinction
between the liability of union officers and ordinary
union members, in the latter, no such distinction exists
as the very act of defiance of such order would result
in the termination of employment, irrespective of
whether the defiant worker is a union officer or an
ordinary union member.
Situation: 100 workers participated in the strike. The
company hired 100 workers to replace the strikers.
Then the strike stops. What happens? The strikers
should be accepted back. Now, the company will find
itself with 200 workers, what can the company do?
70
Management can dismiss based on redundancy. If we
use the last in first out rule in redundancy, then the
replacement workers will be terminated first.
One problematic area when it comes to the issue on
grievance strikes is when union members are illegally
dismissed by the employer because of mere
participation in a grievance strike. Clearly it is an
illegal dismissal.
Ordinary union members cannot be dismissed by
mere participation in an illegal strike, the management
if they dismiss the employee would be liable for an
illegal dismissal.
Reinstatement and backwages
The rule concerning dismissal is simple, if there is an
illegal dismissal the remedy is reinstatement + back
wages.
In some cases, the SC would say that the worker is
entitled to reinstatement only, not to backwages. The
court attributes the strikers for their participation in the
strike.
What you need to understand is the reason for the
dismissal:
If the reason is the participation in the strike, let’s say
the strike already ended because of the assumption of
jurisdiction. The management, however, refused to
readmit the workers because the strike was illegal,
even if the workers were not union officers.
 In this case, ordinarily, it will be an illegal
dismissal and thus the workers will be entitled to
reinstatement with full backwages
 In some cases, however, the SC would say they
are not entitled to backwages because they went
on strike: no work, no pay.
 So for this I’d say you have to be very careful at
which point they were dismissed, and when
they’d be entitled to backwages:
 If they were dismissed today because
they have been in strike for a month:
they were illegally dismissed starting
today
 If the strike has continued after today,
then they are not entitled to backwages.
Afterall, they were still in strike. They
were not intending to go back to work.
 If, on the other hand, they were
returning to work after assumption of
jurisdiction, but management refused to
accept them back and dismissed them,
backwages should be given FROM
THAT POINT.
Q: Who has jurisdiction to declare a strike illegal?
- LABOR ARBITER. He has exclusive original
jurisdiction.
- Employer can file a petition to declare a
strike illegal but this is independent of an
assumption of jurisdiction by the SOLE.
 - If there is an assumption/ certification by the
SOL, the SOLE in addition to deciding the
dispute, can also declare the strike illegal.
Assumption of Jurisdiction
Art 278, (g) When, in his opinion, there exists a
labor dispute causing or likely to cause a strike or
lockout in an industry indispensable to the national
interest, the Secretary of Labor and Employment
may assume jurisdiction over the dispute and
decide it or certify the same to the Commission for
compulsory arbitration.
 Such assumption or certification 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.
 The Secretary of Labor and Employment or
the Commission may seek the assistance of
law enforcement agencies to ensure
compliance with this provision as well as with
such orders as he may issue to enforce the
same.
The foregoing notwithstanding, the President of the
Philippines shall not be precluded from determining
the industries that, in his opinion, are indispensable
to the national interest, and from intervening at any
time and assuming jurisdiction over any such labor
dispute in order to settle or terminate the same.
(h) Before or at any stage of the compulsory
arbitration process, the parties may opt to submit
their dispute to voluntary arbitration.
(i) The Secretary of Labor and Employment, the
Commission or the voluntary arbitrator or panel of
voluntary arbitrators shall decide or resolve the
dispute within thirty (30) calendar days from the
date of the assumption of jurisdiction or the
certification or submission of the dispute, as the
case may be. The decision of the President, the
Secretary of Labor and Employment, the
Commission or the voluntary arbitrator shall be
final and executory ten (10) calendar days after
receipt thereof by the parties.
A strike is initiated by a notice of strike not by a
complaint or petition. You are merely announcing an
intent to strike. Because of that you are not expecting
any adjudication because it's not a petition, you are
not expecting a resolution granting or denying what
you filed. You simply notified.
71
In fact, no government tribunal has a jurisdiction over
the strike. The role of the NCMB is merely to assist
the parties in arriving at an amicable settlement, but
not to decide the dispute for the parties.
So generally, at the point when you file your notice of
strike, no court or body has jurisdiction to adjudicate
the dispute and resolve it for the parties.
That’s why we have this concept called assumption of
jurisdiction.
 Assumption of jurisdiction is a special action that
can be done only by two officers: the SOLE and
the President of the Philippines.
 Such assumption is compulsory on the part of the
parties. They have no choice. This is unique to
labor dispute resolution, unlike other cases where
jurisdiction is determined on your initiatory
pleadings. Here, there is no initiatory pleading.
Assumption of Jurisdiction by the SOLE
The Secretary has two options:
1) Assume jurisdiction over the dispute and decide it
himself; or
2) Certify it to the NLRC for compulsory arbitration
in which case it will be the NLRC which shall hear
and decide it.
He may also assume jurisdiction and later decide to
certify the same to the NLRC.
Assumption of Jurisdiction by the President
Unlike the SOLE, the President, while possessed of
the power of assumption, has no similar power to
certify the labor dispute to the NLRC, this power being
granted solely to the SOLE. His role is confined to
assuming jurisdiction thereover.
Thus, the President may either decide the dispute
himself, or in the alternative, he may create a body to
discharge his mandate under the law.
 This is what happened in the PALEA case where
Erap created an IATF to aid PAL and its
employees in resolving its dispute, which resulted
in the suspension of the CBA for over a decade.
Coverage assumption of jurisdiction/certification
Any strike regardless of the ground can be subject to
the assumption of jurisdiction. In practice, however,
most if not all ULP strikes are certified to the NLRC,
while strikes grounded on deadlock are decided by
the SOLE.
However, not all disputes may be covered by an
assumption order. It must be a dispute which might
affect an industry that is indispensable to the
national interest. It can be just one company BUT if
that company is part of an industry that is
indispensable to the national interest, then that can be
subject to the jurisdiction of the SOLE.
Q: Is there a definition for industries indispensable?
A: None. When the Secretary of Labor decides that an
industry is indispensable, then the courts usually
respect this finding.
Industries indispensable to national interest: (HE-
WAS)
a) Hospital sector;
b) Electrical power supply;
c) Water supply services, excluding small water
supply services, such as bottling and refilling
stations;
d) Air traffic control (airline companies); and
e) Such other industries as may be
recommended by the National Tripartite
Industrial Peace Council.
Based on jurisprudence:
a) Shipping/maritime industry (Transasia case)
b) Hotel services (Manila Diamond Hotel)
c) Telco services (Philcom)
d) Manufacturer of cars and spare parts
(Nissan Motiors)
e) Bank (solid bank)
f) Educational institutions
Should the Secretary assume jurisdiction in a dispute
which does not involve an industry indispensable to
national interest, he will be acting with grave abuse of
discretion amounting to lack or excess of jurisdiction.
 Examples based on jurisprudence: a match
factory, a company that produced telephone
directories.
Note further that the DOLE Secretary or the President
may assume jurisdiction even in the absence of an
actual strike. The Labor Code provides that he may
also assume jurisdiction over a dispute “likely to
cause a strike or lockout” in an industry
indispensable to the national interest.
Likewise, the Secretary may assume jurisdiction
where both parties have requested the Secretary to
assume jurisdiction over the labor dispute (Sec 15,
Rule 22, DO 40-H-13)
Effect of assumption/certification
1) On intended/impending strike/lockout:
automatically enjoined
2) On actual strike/lockout: all striking or locked out
employees shall immediately return to work
3) On cases already filed/may be filed: considered
subsumed or absorbed by the assumed/certified
case.
Note that an assumption/certification order is
immediately executory, even if a motion for
reconsideration thereof is filed.
However, before or at any stage of the compulsory
arbitration process, the parties may, by mutual
agreement, decide to bring the matter for resolution
before an accredited Voluntary Arbitrator or Panel of
72
Voluntary Arbitrators of their own choice, in which
case, the notice is deemed automatically withdrawn
and dropped from the docket.
 This is in line with the constitutional principle of
giving the highest preference to the use of
voluntary modes to settle labor disputes.
Plenary Authority
The SOLE’s authority in assuming jurisdiction is
plenary in nature. Any dispute can be resolved by the
SOLE to end the strike or lockout. All
incidental/pending issues should be subsumed,
including cases over which the Labor Arbiter has
exclusive jurisdiction.
Ratio: SOLE assumes jurisdiction because of the
industry involved. So it’s not just the parties that he
must consider. That’s why his authority is plenary.
Return-to-work order
Assumption of jurisdiction always co-exists with an
order for workers to return to work immediately and
for employers to readmit all of them under the same
terms and conditions prevailing before the strike or
lockout, even if the same has not been categorically
stated or does not appear in the assumption or
certification order.
It is thus not necessary for the DOLE Secretary to
issue another order directing the strikers to return to
work. The mere issuance of an assumption or
certification order automatically carries with it a return-
to-work order, even if the directive to return to work is
not expressly stated therein.
Return-to-work order: status quo ante – the
employees must be readmitted under the same terms
and conditions prevailing before the strike or lockout.
 Hence, there could be no demotion or
reassignment or any sort of retaliation by the
employer.
 If the employer refuses to operate and readmit
the employees, that is an act of illegal lockout.
 In a case where the employees (union officers)
were dismissed purportedly due to an authorized
cause but before the effectivity of the termination
they went on strike on the ground of ULP for
union busting, the status quo ante must still be
the same. They should be readmitted since the
termination was not yet effective.
Actual reinstatement, not payroll reinstatement
GR: return-to-work orders contemplate actual
reinstatement, and not payroll reinstatement.
Otherwise, GADLEJ.
 The Labor Code contains only one provision
authorizing payroll reinstatement: illegal dismissal
case declared by the Labor Arbiter pending
appeal before the NLRC.
XPN: existence of certain circumstances that render
actual reinstatement impracticable or otherwise not
conducive to attaining the purposes of the law.
 Examples based on jurisprudence:
o Return-to-work order issued in the middle of
the first semester of the academic year (UST
vs NLRC)
o Employees who shaved their heads or
cropped their hair because this was exactly
the reason they were prevented from
working in the first place. Further, as with
most labor disputes which have resulted in
strikes, there is mutual antagonism, enmity,
and animosity between the union and the
management. Payroll reinstatement, most
especially in this case, would have been the
only avenue where further incidents and
damages could be avoided. (Dusit Hotel v
Nikko)
Other notes:
 A return-to-work order is compulsory and not
offensive to involuntary servitude because of the
public interest involved. It can only be issued for
labor disputes which have an effect to industries
indispensable to national interest. Further, the
workers may choose not to obey, though they do
so at the risk of severing their relationship with
their employer.
 A return-to-work order is an interim measure. The
act of strikers in voluntarily returning to work does
not result in the waiver of their original demands.
In the same breadth, it does not render moot and
academic the issue of the illegality of the strike
which the employer may insist upon.
Defiance of Assumption/Certification Order
Defiance = commission of an illegal act; the strike
then becomes illegal
As to the employees, there will be no distinction
between union officers and members. The defiant
striking union officers and members, as a result, are
deemed to have lost their employment status for
having knowingly participated in an illegal strike. From
the moment a worker defies a return-to-work order, he
is deemed to have abandoned his job and forfeited his
right to be readmitted to work. That is why this is an
exception to the rule that participation in an illegal
strike cannot be used to justify a mass/wholesale
dismissal of workers. If it’s a violation of an
assumption order, there can be such wholesale
dismissal.
On the other hand, if the employer defies, then the
employer is liable to pay backwages. This is a
monetary liability on the part of the defiance of the
employer.
The SC has emphasized the importance of
NOTICE.
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Without proper notice, we cannot rule that the strikers
defied the order of the SOL. Therefore, they cannot
be fired.
- In one case involving University of the East,
the notice was simply posted in the vicinity of
the strike area, the SC said that is not proper
notice.
- The court applied the Rules on Service. It
should be personal service and if not
possible, then substituted service.
- Merely posting copies of the order in the
vicinity of the premises of the strike area is
not adequate notice on the part of the
employer.
When can you have an arbitral award?
- If you have a strike based on deadlock, and
you have assumption of jurisdiction by the
SOLE, the decision of the Secretary will be
considered an arbitral award imposing a
CBA between the parties
- Otherwise, without assumption of jurisdiction,
you can’t have an arbitral award imposing a
CBA between the parties
- What will happen? Sec of Labor will require
parties to submit their position papers and
then the SOLE will decide somewhere in
between the positions of the parties. Sec of
Labor will weigh positions and justify the
decision based on the facts presented by the
parties against the socio economic
conditions then present.
ARTICLE 280. [265] Improved Offer Balloting. — In
an effort to settle a strike, the Department of Labor
and Employment shall conduct a referendum by
secret balloting on the improved offer of the employer
on or before the 30th day of the strike. When at least
a majority of the union members vote to accept the
improved offer the striking workers shall immediately
return to work and the employer shall thereupon
readmit them upon the signing of the agreement.
In case of a lockout, the Department of Labor and
Employment shall also conduct a referendum by
secret balloting on the reduced offer of the union on or
before the 30th day of the lockout. When at least a
majority of the board of directors or trustees or the
partners holding the controlling interest in the case of
a partnership vote to accept the reduced offer, the
workers shall immediately return to work and the
employer shall thereupon readmit them upon the
signing of the agreement.
ARTICLE 281. [266] Requirement for Arrest and
Detention. — Except on grounds of national security
and public peace or in case of commission of a crime,
no union members or union organizers may be
arrested or detained for union activities without
previous consultations with the Secretary of Labor.
Injunction
 ARTICLE 266. [254] Injunction Prohibited. — No
temporary or permanent injunction or restraining
order in any case involving or growing out of labor
disputes shall be issued by any court or other
entity, except as otherwise provided in Articles 225
and 279 of this Code.
Article 225. Powers of the NLRC:
(e) To enjoin or restrain any actual or threatened
commission of any or all prohibited or unlawful acts
or to require the performance of a particular act in
any labor dispute which, if not restrained or
performed forthwith, may cause grave or
irreparable damage to any party or render
ineffectual any decision in favor of such party:
Provided, That no temporary or permanent
injunction in any case involving or growing out of a
labor dispute as defined in this Code shall be
issued except after hearing the testimony of
witnesses, with opportunity for cross-examination,
in support of the allegations of a complaint made
under oath, and testimony in opposition thereto, if
offered, and only after a finding of fact by the
Commission, to the effect:
1) That prohibited or unlawful acts have been
threatened and will be committed and will be
continued unless restrained, but no injunction
or temporary restraining order shall be issued
on account of any threat, prohibited or unlawful
act, except against the person or persons,
association or organization making the threat
or committing the prohibited or unlawful act or
actually authorizing or ratifying the same after
actual knowledge thereof;
2) That substantial and irreparable injury to
complainant's property will follow;
3) That as to each item of relief to be granted,
greater injury will be inflicted upon complainant
by the denial of relief than will be inflicted upon
defendants by the granting of relief;
4) That complainant has no adequate remedy at
law; and
5) That the public officers charged with the duty
to protect complainant's property are unable or
unwilling to furnish adequate protection.
Such hearing shall be held after due and personal
notice thereof has been served, in such manner as
the Commission shall direct, to all known persons
against whom relief is sought, and also to the Chief
Executive and other public officials of the province
or city within which the unlawful acts have been
threatened or committed, charged with the duty to
protect complainant’s property:
Provided, however, that if a complainant shall also
allege that, unless a temporary restraining order
shall be issued without notice, a substantial and
irreparable injury to complainant’s property will be
unavoidable, such a temporary restraining order
74
may be issued upon testimony under oath,
sufficient, if sustained, to justify the Commission in
issuing a temporary injunction upon hearing after
notice. Such a temporary restraining order shall be
effective for no longer than twenty (20) days and
shall become void at the expiration of said twenty
(20) days. No such temporary restraining order or
temporary injunction shall be issued except on
condition that complainant shall first file an
undertaking with adequate security in an amount to
be fixed by the Commission sufficient to
recompense those enjoined for any loss, expense
or damage caused by the improvident or erroneous
issuance of such order or injunction, including all
reasonable costs, together with a reasonable
attorney's fee, and expense of defense against the
order or against the granting of any injunctive relief
sought in the same proceeding and subsequently
denied by the Commission.
The undertaking herein mentioned shall be
understood to constitute an agreement entered into
by the complainant and the surety upon which an
order may be rendered in the same suit or
proceeding against said complainant and surety,
upon a hearing to assess damages, of which
hearing, complainant and surety shall have
reasonable notice, the said complainant and surety
submitting themselves to the jurisdiction of the
Commission for that purpose. But nothing herein
contained shall deprive any party having a claim or
cause of action under or upon such undertaking
from electing to pursue his ordinary remedy by suit
at law or in equity: Provided, further, That the
reception of evidence for the application of a writ of
injunction may be delegated by the Commission to
any of its Labor Arbiters who shall conduct such
hearings in such places as he may determine to be
accessible to the parties and their witnesses and
shall submit thereafter his recommendation to the
Commission.
GR: strikes and lockouts that are validly declared
enjoy the protection of the law and cannot be enjoined
unless illegal acts are committed or threatened to be
committed in the course thereof. This policy applies
even if the strike appears to be illegal in nature.
However, in some cases, injunctions issued to enjoin
the conduct of the strike itself and not only the
commission of illegal or prohibited acts in the course
thereof were hold to be valid, such as:
 Where the notice of strike filed by the union has
been converted into a preventive mediation case.
Upon such conversion, the legal effect is that
there is no more notice of strike to speak of. (San
Miguel vs NLRC)
 Cases involving unlawful strike or a strike based
on non-strikeable grounds;
 A partial strike staged in violation of the law (IBM
vs NLRC)
  Despite the pendency of the assumed or
It bears stressing that all the cases cited above certified national interest case, the parties
involve the issuance of restraining order by the NLRC are allowed to submit any issues raised
pursuant to the exercise of its injunctive power. therein to VA at any stage of the
Regular courts are absolutely prohibited to grant proceedings.
any injunctive relief in cases of strikes or
lockouts.

On the other hand, regular courts can issue injunctive

reliefs in picketing specifically in the ff cases:
1) Where picketing is carried out through the use of
illegal means;
2) Where picketing involves the use of violence and
other illegal acts;
3) Where picketing affects the rights of third parties
and injunction becomes necessary to protect
such rights;
4) Innocent bystander rule due to the lack of ER-EE
relationship necessary for the NLRC to acquire
jurisdiction.

JURISDICTIONAL INTERPLAY IN STRIKE OR

LOCKOUT CASES
As distinguished from other labor cases, a labor
dispute involving a strike or lockout is unique as it
involves an interplay of jurisdiction of several labor
officials or tribunals.

1) Filing of notice of strike lockout – NCMB

 The NCMB is not a quasi-judicial body.
Hence, it does not have any decision-making
power. They cannot resolve issues raised in
the notice of strike or lockout, nor can they
declarate legality or illegality thereof.
 Their role is confined solely to the
conciliation and mediation of the said issues,
although they can suggest that the dispute
be submitted to voluntary arbitration.

2) Filing of complaint to declare illegality of the

strike or lockout with the Labor Arbiter or
Voluntary Arbitrator.
 In case a party wants to have the strike or
lockout declared as illegal, a complaint
should be filed either with the Labor Arbiter
or, upon mutual agreement of the parties,
with the Voluntary Arbitrator.

3) Filing of injunction petition with the NLRC

 The aggrieved party, despite the pendency
of the case for declaration of the illegality of
the strike or lockout with the LA or VA, may
directly go to the Commission to secure
injunctive relief against illegal acts committed
in the course of the strike or lockout.

4) Assumption of Jurisdiction by the Secretary

5) Certification of dispute to the NLRC
6) Assumption of jurisdiction by the President
7) Submission of a national interest case to
voluntary arbitration

75
 VI. MANAGEMENT PREROGATIVE
An employer is free to regulate according to his own
discretion and judgment all aspects of employment,
from hiring to firing.
Limitations:
1. Must be exercised in good faith
2. Not exercised for the purpose of circumventing:
a) employee’s rights under the law; or
b) employee’s rights under valid agreements
like the CBA;
c) law, morals, good custom, public policy, or
public order.
3. Principles of justice and fair play.
A. DISCIPLINE
Management has the prerogative to discipline its
employees and to impose appropriate penalties on
erring workers, pursuant to company rules and
regulations.
Totality of infractions doctrine
The totality of infractions or the number of violations
committed during the period of employment shall be
considered in determining the penalty to be imposed
upon an erring employee. Fitness for continued
employment cannot be compartmentalized into tight
little cubicles of aspects of character, conduct and
ability separate and independent of each other. While
it may be true that petitioner was penalized for his
previous infractions, this does not and should not
mean that his employment record would be wiped
clean of his infractions. After all, the record of an
employee is a relevant consideration in determining
the penalty that should be meted out since an
employee's past misconduct and present behavior
must be taken together in determining the proper
imposable penalty. (Merin v. NLRC, G.R. No. 171790)
Although the right of employers to shape their own
work force, is recognized, this management
prerogative must not curtail the basic right of
employees to security of tenure.
B. TRANSFER OR EMPLOYEES
An employee’s right to security of tenure does not
give him such a vested right in his position as would
deprive the company of its prerogative to change his
assignment or transfer him where he will be most
useful.
When the transfer is not unreasonable, or
inconvenient, or prejudicial to the employee, and it
does not involve a demotion in rank or diminution of
salaries, benefits, and other privileges, the employee
may not complain that it amounts to a constructive
dismissal.
 However, the burden of proof is on the employer
to prove the aforementioned. If the employer
cannot overcome this burden of proof, the
employee’s transfer shall be tantamount to
unlawful constructive dismissal.
76
C. PRODUCTIVITY STANDARDS
The imposition of productivity standards is an
allowable exercise of company rights. An employer is
entitled to impose productivity standards for its
workers and non-compliance may be visited with a
penalty even more severe than demotion.
As a general concept, “poor performance” is
equivalent to inefficiency and incompetence in the
performance of official duties.
 Under Art. 282 of the Labor Code, an
unsatisfactory rating can be a just cause for
dismissal only if it amounts to gross and habitual
neglect of duties.
 Thus, the fact that an employee’s performance is
found to be poor or unsatisfactory does not
necessarily mean that the employee is grossly
and habitually negligent of his duties. Gross
negligence implies a want or absence of or failure
to exercise slight care of diligence, or the entire
absence of care. It evinces a thoughtless
disregard of consequences without exerting any
effort to avoid them.
D. BONUS
The granting of bonus is a management prerogative,
something given in addition to what is ordinarily
received by or strictly due the recipient.
E. CHANGE OF WORKING HOURS
Management retains the prerogative, whenever
exigencies of the service so require, to change the
working hours of its employees.
F. BONA FIDE OCCUPATIONAL
QUALIFICATIONS
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).
To justify a bona fide occupational qualification, the
employer must prove 2 factors:
1) that the employment qualification is reasonably
related to the essential operation of the job
involved; and,
2) that there is a factual basis for believing that all or
substantially all persons meeting the qualification
would be unable to properly perform the duties of
the job
G. POST-EMPLOYMENT RESTRICTIONS
In cases where an employee assails a contract
containing a provision prohibiting him or her from
accepting competitive employment as against public
policy, the employer has to adduce evidence to prove
that the restriction is reasonable and not greater than
necessary to protect the employer’s legitimate
business interests. The restraint may not be unduly
harsh or oppressive in curtailing the employee’s
legitimate efforts to earn a livelihood and must be
reasonable in light of sound public policy.

In determining whether the contract is reasonable

or not, the trial court should consider the
following factors:
1) Whether the covenant protects a legitimate
2) business interest of the employer;
3) Whether the covenant creates an undue burden
on the employee;
4) Whether the covenant is injurious to the public
welfare;
5) Whether the time and territorial limitations
contained in the covenant are reasonable;
and
6) Whether the restraint is reasonable from the
standpoint of public policy. (Rivera v. Solidbank
Corporation, G.R. No. 163269, 2006)

H. MARRIAGE BETWEEN EMPLOYEES OF

COMPETITOR-EMPLOYERS
It is a legitimate business practice to guard business
confidentiality and protect a competitive position by
even-handedly disqualifying from jobs male and
female applicants or employees who are married to a
competitor.

It shall be unlawful for an employer:

1) to require as a condition of employment or
continuation of employment that a woman
employee shall not get married, or
2) to stipulate expressly or tacitly that upon getting
married, a woman employee shall be deemed
resigned or separated, or
3) to actually dismiss, discharge, discriminate or
otherwise prejudice a woman employee merely
by reason of her marriage.

PT&T vs NLRC
The Court cited the Constitution, CEDAW, the Labor
Code, and other laws to emphasize the state policy
towards eliminating discrimination against women.
o Article 132 ensures the right of women to be
provided with facilities and standards which the
Secretary of Labor may establish to ensure their
health and safety, and others.
o Article 136 of the Labor Code explicitly prohibits
discrimination merely by reason of the marriage
of a female employee.
 Acknowledged as paramount in the due process
scheme is the constitutional guarantee of
protection to labor and security of tenure.

PT&T’s policy of not accepting or considering as

disqualified from work any woman worker who
contracts marriage runs afoul of the test of, and the
right against, discrimination, afforded all women
workers by our labor laws and by no less than the
Constitution.

77
 VI. SOCIAL LEGISLATION
A. SOCIAL SECURITY SYSTEM LAW
1. Coverage and exclusion
Compulsory Coverage
1) all employees including kasambahays or
domestic workers not over sixty (60) years of age
and their employers;
 Employee – Any person who performs
services for an employer in which either or
both mental or physical efforts are used and
who receives compensation for such
services, where there is an employer-
employee relationship: Provided, That a self-
employed person shall be both employee
and employer at the same time.
2) self-employed persons as may be determined by
the Commission under such rules and regulations
as it may prescribe, including, but not limited to
the following:
a) All seif-empioyed professionals;
b) Partners and single proprietors of
businesses;
c) Actors and actresses, directors, scriptwriters
and news correspondents who do not fall
within the definition of the term "employee" in
Section 8(d) of this Act;
d) Professional athletes, coaches, trainers and
jockeys; and
e) Individual farmers and fishermen.
3) all sea-based and land-based OFWs;
 Manning agencies are agents of their
principals and are considered as employers
of sea-based OFWs.
 GR: land-based OFWS are considered in the
same manner as self-employed persons
 XPN: when the DFA, DOLE and other
pertinent agencies were able to negotiate
bilateral labor agreements with the OFWs’
host countries to ensure that the employers
of land-based OFWs pay the required SSS
contributions, in which case they shall be
considered as compulsorily covered
employees with employer and employee
shares in contributions.
Voluntary Coverage
1) Spouses who devote full time to managing the
household and family affairs, unless they are also
engaged in other vocation or employment which
is subject to mandatory coverage
2) OFWS upon termination of their employment
overseas (may continue to pay contributions on a
voluntary basis to maintain their rights to full
benefits)
3) Filipino permanent migrants, including Filipino
immigrants, permanent residents and naturalized
citizens of their host countries
Section 10. Effective Date of Coverage. - Compulsory
coverage of the employer shall take effect on the first
day of his operation and that of the employee on the
day of his employment: Provided, That the
78
compulsory coverage of the self-employed person
shall take effect upon his registration with the SSS.
Section 11. Effect of Separation from Employment. -
When an employee under compulsory coverage is
separated from employment, his employer’s
contribution on his account and his obligation to pay
contributions arising from that employment shall
cease at the end of the month of separation, but said
employee shall be credited with all contributions paid
on his behalf and entitled to benefits according to the
provisions of this Act. He may, however, continue to
pay the total contributions to maintain his right to full
benefit.
Section 11-A. Effect of Interruption of Business or
Professional Income. - If the self-employed member
realizes no income in any given month, he shall not
be required to pay contributions for that month. He
may, however, be allowed to continue paying
contributions under the same rules and regulations
applicable to a separated employee
member: Provided, That no retroactive payment of
contributions shall be allowed other than as
prescribed under Section 22-A hereof.
Exclusions
Excluded Employer: the government and any of its
political subdivisions, branches or instrumentalities,
including corporations owned or controlled by the
Government.
Excluded Employee: workers whose employment or
service falls under any of the following circumstances:
1) Services where there is no employer-employee
relationship in accordance with existing labor
laws, rules, regulations and jurisprudence;
2) Service performed in the employ of the Philippine
Government or instrumentality or agency thereof;
3) Service performed in the employ of a foreign
government or international organization, or their
wholly-owned instrumentality: 
Provided, however, That this exemption
notwithstanding, any foreign government,
international organization or their wholly-owned
instrumentality employing workers in the
Philippines or employing Filipinos outside of the
Philippines, may enter into an agreement with the
Philippine Government for the inclusion of such
employees in the SSS except those already
covered by their respective civil service
retirement systems: 
Provided, further, That the terms of such
agreement shall conform with the provisions of
this Act on coverage and amount of payment of
contributions and benefits: 
Provided, finally, That the provisions of this Act
shall be supplementary to any such agreement;
and
4) Such other services performed by temporary and
other employees which may be excluded by
 regulation of the Commission. Employees
of bona fide independent contractors shall not be
deemed employees of the employer engaging the
service of said contractors.
2. Dependents and beneficiaries
Dependents – The dependents shall be the following:
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 (21)
years of age, he is congenitally or while still a
minor has been permanently incapacitated and
incapable of self-support, physically or mentally:
and
3) The parent who is receiving regular support from
the member.
Beneficiaries
1) The dependent spouse until he or she remarries,
the dependent legitimate, legitimated or legally
adopted, and illegitimate children, who shall be
the primary beneficiaries of the member:  Disability Benefits
Provided, That the dependent illegitimate children
shall be entitled to fifty percent (50%) of the share
of the legitimate, legitimated or legally adopted
children:  b) Loss of two limbs at or above the ankle or wrists;
Provided, further, That in the absence of the
dependent legitimate, legitimated or legally
adopted children of the member, his/her
dependent illegitimate children shall be entitled to
one hundred percent (100%) of the benefits.
2) In their absence, the dependent parents who
shall be the secondary beneficiaries of the
member.
3) In the absence of all the foregoing, any other
person designated by the member as his/her
secondary beneficiary.
3. Benefits
SSS benefits may be classified to a) Social Security
benefits; and b) employee’s compensation benefits.
Social security benefits include:
a) Sickness
b) Maternity leave
c) Retirement
d) Unemployment insurance or involuntary
separation
e) Disability
f) Death
g) Funeral
“Monthly Pension” – the highest of:
1) The sum of P300 + 20% of the average monthly
average credit + 2% of the average monthly
79
salary credit for each credited year of service in
excess of ten (10) years; or
2) 40% of the  average monthly salary credit; or
3) P1000.
Provided, That the monthly pension shall in no case
be paid for an aggregate amount of less than sixty
(60) months.
Notwithstanding the preceding paragraph, the
minimum pension shall be:
 P1,200 for members with at least 10 credited
years of service
 P2, 400 for members with at least 20 credited
years of service.
An additional monthly benefit allowance amounting to
₱1,000.00 shall be given to all retirement, death, and
disability pensioners receiving monthly pensions in or
after January 2017. The Commission may determine
the grant of additional benefit
allowance: Provided, That the actuarial soundness of
the reserve fund shall be guaranteed. 
Permanent Total Disability
The following disabilities shall be deemed permanent
total:
a) Complete loss of sight of both eyes;
c) Permanent complete paralysis of two limbs;
d) Brain injury resulting to incurable imbecility or
insanity; and
e) Such cases as determined and approved by the
SSS.
Benefit: monthly pension
Qualification for monthly pension
1) permanent total disability of a member;
2) has paid at least thirty-six (36) monthly
contributions prior to the semester of disability
Benefit:  lump sum benefit equivalent to the monthly
pension times the number of monthly contributions
paid to the SSS or twelve (12) times the monthly
pension, whichever is higher.
Qualification for monthly pension
1) permanent total disability of a member;
2) has NOT paid at least thirty-six (36) monthly
contributions prior to the semester of disability.
Conditions:
The monthly pension and dependents’ pension shall
be suspended upon:
a) the reemployment or resumption of self-
employment; or
b) the recovery of the disabled member from his
permanent total disability; or
c) his failure to present himself for examination at
least once a year upon notice by the SSS.
Upon the death of the permanent total disability
pensioner, his primary beneficiaries as of the date of
disability shall be entitled to receive the monthly
pension: Provided, That if he has no primary
beneficiaries and he dies within sixty (60) months
from the start of his monthly pension, his secondary
beneficiaries shall be entitled to a lump sum benefit
equivalent to the total monthly pensions
corresponding to the balance of the five-year
guaranteed period excluding the dependents’
pension.
Permanent Partial Disability
Benefit: depends on whether disability occurs before
or after thirty-six (36) monthly contributions have been
paid prior to the semester of disability.
 Before: such percentage of the lump sum benefit
described in the preceding paragraph (permanent
total) with due regard to the degree of disability
as the Commission may determine.
 After: the monthly pension for permanent total
disability payable not longer than the period
designated in the schedule provided under the
SSS Act of 2018.
Note:
 In case of permanent partial disability, the
monthly pension benefit shall be given in lump
sum if it is payable for less than twelve (12)
months.
 For the purpose of adjudicating retirement, death
and permanent total disability pension benefits,
contributions shall be deemed paid for the
months during which the member received partial
disability pension: Provided, That such
contributions shall be based on his last
contribution prior to his disability.
 Should a member who is on partial disability
pension retire or die, his disability pension shall
cease upon his retirement or death.
Retirement Benefits
Retirement benefits is a cash benefit either in monthly
pension or lump sum who can no longer work due to
old age.
Benefit: the monthly pension is a lifetime cash
benefit paid to a retiree who has paid at least 120
monthly contributions to the SSS prior to the semester
of retirement.
 Monthly pension = the higher of either: (1) the
monthly pension computed at the earliest time he
could have retired had he been separated from
employment or ceased to be self-employed plus
all adjustments thereto; or (2) the monthly
pension computed at the time when he actually
retires.
Qualification for the monthly pensions:
1. has paid at least one hundred twenty (120)
monthly contributions prior to the semester of
retirement; and
80
2. has reached the age of sixty (60) years and is
already separated from employment or has
ceased to be self-employed; OR
3. has reached the age of sixty-five (65) years
Note: he shall have the option to receive his first 18
monthly pensions in lump sum discounted at a
preferential rate of interest to be determined by the
SSS.
Benefit:  lump sum benefit equal to the total
contributions paid by the member and by the
employer including interest.
Qualification for the lump sum pension:
1. sixty (60) years old at retirement;
2. does not qualify for monthly pension benefits; and
3. separated from employment and is not continuing
payment of contributions to the SSS on his own.
In addition, the retiree is entitled to a 13 th month
pension payable every December.
Others:
 The monthly pension shall be suspended upon
the reemployment or resumption of self-
employment of a retired member who is less than
65 years old.
 Upon the death of the retired member, his
primary beneficiaries as of the date of his
retirement shall be entitled to receive the monthly
pension.
 If he has no primary beneficiaries and he dies
within 60 months [5 years] from the start of his
monthly pension, his secondary beneficiaries
shall be entitled to a lump sum benefit equivalent
to the total monthly pensions corresponding to
the balance of the five-year guaranteed period,
excluding the dependents’ pension.
Death Benefits
Upon the death of a member who has paid at least 36
monthly contributions prior to the semester of death,
his primary beneficiaries shall be entitled to the
monthly pension: 
Provided, That if he has no primary beneficiaries, his
secondary beneficiaries shall be entitled to a lump
sum benefit equivalent to 36 times the monthly
pension.
If he has not paid the required 36 monthly
contributions, his primary or secondary beneficiaries
shall be entitled to a lump sum benefit equivalent to
the monthly pension times the number of monthly
contributions paid to the SSS or 12 times the monthly
pension, whichever is higher.
Funeral Benefit
A funeral grant equivalent to ₱12,000.00 shall be
paid, in cash or in kind, to help defray the cost of
funeral expenses upon the death of a member,
including permanently totally disabled member or
retiree.
Dependents’ Pension
Where monthly pension is payable on account of
death, permanent total disability or retirement,
dependents’ pension equivalent to 10% of the monthly
pension or 250.00, whichever is higher, shall also be
paid for each dependent child conceived on or before
the date of the contingency but not exceeding five (5),
beginning with the youngest and without substitution:  payable: Provided, That such allowance shall begin
Provided, That where there are legitimate and
illegitimate children, the former shall be preferred.
Sickness Benefit
- Daily cash allowance paid for the number of
days a member is unable to work due to
sickness or injury
Benefit: a daily sickness benefit equivalent to ninety
percent (90%) of his average daily salary credit for
each day of compensable confinement or a fraction
thereof
Qualification:
a) has paid at least three (3) monthly contributions
in the twelve-month period immediately preceding
the semester of sickness or injury;
b) and is confined therefor for more than three (3)
days in a hospital or elsewhere with the approval
of the SSS
Conditions:
1) In no case shall the daily sickness benefit be paid
longer than one hundred twenty (120) days in
one (1) calendar year, nor shall any unused
portion of the one hundred twenty (120) days of
sickness benefit granted under this section be
carried forward and added to the total number of
compensable days allowable in the subsequent
year;
2) The daily sickness benefit shall not be paid for
more than two hundred forty (240) days on
account of the same confinement; and
3) The employee member shall notify his employer
of the fact of his sickness or injury within five (5)
calendar days after the start of his confinement
unless such confinement is in a hospital or the
employee became sick or was injured while
working or within the premises of the employer in
which case, notification to the employer is not
necessary:  retirement age of 65 or more shall also be
Provided, That if the member is unemployed or
self-employed, he shall directly notify the SSS of
his confinement within five (5) calendar days after
the start thereof unless such confinement is in a
hospital in which case notification is also not
necessary:  following situations:
Provided, further, That in cases where notification
is necessary, the confinement shall be deemed to
81
have started not earlier than the fifth day
immediately preceding the date of notification.
Others:
The compensable confinement shall begin on the first
day of sickness, and the payment of such allowances
shall be promptly made by the employer every regular
payday or on the fifteenth and last day of each month,
and similarly in the case of direct payment by the
SSS, for as long as such allowances are due and
only after all sick leaves of absence with full pay to the
credit of the employee member shall have been
exhausted.
Unemployment. Insurance or Involuntary
Separation Benefits. 
Benefit: monthly cash payments equivalent to fifty
percent (50%) of the average monthly salary credit for
a maximum of two (2) months: 
Qualification:
1) has paid at least thirty-six (36) months
contributions twelve (12) months of which should
be in the eighteen-month period immediately
preceding the involuntary unemployment or
separation;
2) member who is not over sixty (60) years of age.
Conditions:
1) an employee who is involuntarily unemployed can
only claim unemployment benefits once every
three (3) years
2) in case of concurrence of two or more
compensable contingencies, only the highest
benefit shall be paid, subject to the rules and
regulations that the Commission may prescribe.
B. GOVERNMENT SERVICE INSURANCE SYSTEM
LAW
1. Coverage and exclusions
1) All government personnel, whether elective or
appointive, irrespective of status of appointment,
provided they are receiving fixed monthly
compensation and have not reached the
mandatory retirement age of 65 years, are
compulsorily covered as members of the GSIS
and shall be required to pay contributions.
However, employees who have reached the
covered, subject to the following rules:
An employee who is already beyond the
mandatory retirement age of 65 shall be
compulsorily covered and be required to pay both
the life and retirement premiums under the
a) An elective official who at the time of election
to public office is below 65 years of age and
will be 65 years or more at the end of his
term of office, including the period/s of his re-
 election to public office thereafter without
interruption.
b) Appointive officials who, before reaching the
mandatory age of 65, are appointed to
government position by the President of the
Republic of the Philippines and shall remain
in government service at age beyond 65.
2) Contractual employees including casuals and
other employees with an employee-government
agency relationship are also compulsorily
covered, provided they are receiving fixed
monthly compensation and rendering the
required number of working hours for the month.
Exclusion
The following employees are excluded from
compulsory coverage:
1) Uniformed personnel of the Armed Forces of the
Philippines (AFP), Philippine National Police
(PNP), Bureau of Fire Protection (BFP) and
Bureau of Jail Management and Penology
(BJMP);
2) Barangay and Sanggunian Officials who are not
receiving fixed monthly compensation;
3) Contractual Employees who are not receiving
fixed monthly compensation; and
4) Employees who do not have monthly regular
hours of work and are not receiving fixed monthly
compensation.
The effective date of membership shall be the date of
the member’s assumption to duty on his original
appointment or election to public office.
2. Dependents and beneficiaries
Dependents:
1) legitimate spouse dependent for support on the
member or pensioner;
2) legitimate/legitimated legally adopted child,
including the illegitimate child, who is
a) unmarried,
b) not gainfully employed,
c) not over the age of majority, or is over the
age of majority but incapacitated and
incapable of self-support due to a mental or
physical defect acquired prior to age of
majority
*gainful occupation – any productive activity
that provided the member with income at
least equal to the minimum compensation of
government employees.
3) the parents dependent upon the member for
support.
Beneficiaries
Primary beneficiaries- The legal dependent spouse
until he/she remarries and the dependent children;  fifteen (15) years of service: Provided,  That if he has
Secondary beneficiaries- The dependent parents and,
subject to the restrictions on dependent children, the
legitimate descendants.
82
3. Benefits
Except for the members of the judiciary and
constitutional commissions who shall have life
insurance only, all members of the GSIS shall have
life insurance, retirement, and all other social security
protections such as disability, survivorship,
separation, and unemployment benefits.
Computation of the Basic Monthly Pension. 
The basic monthly pension is equal to 37.5% of the
revalued average monthly compensation + 2.5% of
said revalued average monthly compensation for each
year of service in excess of (15) years: 
Provided, That the basic monthly pension shall not
exceed ninety percent (90%) of the average monthly
compensation. 
Provided, however, that the basic monthly pension
shall not be less than One thousand and three
hundred pesos (P1,300.00): 
Provided, further, that the basic monthly pension for
those who have rendered at least twenty (20) years of
service after the effectivity of this Act shall not be less
than Two thousand four hundred pesos (P2,400.00) a
month. 
1) Compulsory life insurance
All employees except for Members of the Armed
Forces of the Philippines (AFP) and the Philippine
National Police (PNP) shall, under such terms and
conditions as may be promulgated by the GSIS, be
compulsorily covered with life insurance.
2) Retirement
SEC. 13. Retirement Benefits. - (a) Retirement
benefits shall be: 
1) lump sum payment payable at the time of
retirement plus an old-age pension benefit equal
to the basic monthly pension payable monthly for
life, starting upon expiration of the five-year (5)
guaranteed period covered by the lump sum; or
o Lump sum- The basic monthly pension
multiplied by sixty (60)
2) cash payment equivalent to eighteen (18) months
of his basic monthly pension plus monthly
pension for life payable immediately with no five-
year (5) guarantee. 
Unless the service is extended by appropriate
authorities, retirement shall be compulsory for an
employee of sixty-five (65) years of age with at least
less than fifteen (15) years of service, he may be
allowed to continue in the service in accordance with
existing civil service rules and regulations. 
SEC. 13-A.  Conditions for Entitlement. –  following, subject to the corresponding conditions
A member who retires from the service shall be thereof. 
entitled to the retirement benefits enumerated in
paragraph (a) of Section 13 hereof: Provided,  That:  Permanent Total Disability Benefits
1) he has rendered at least fifteen years of service;  The following disabilities shall be deemed total and
2) he is at least sixty (60) years of age at the time of permanent: 
retirement; and  1) complete loss of sight of both eyes;
3) he is not receiving a monthly pension benefit from 2) loss of two (2) limbs at or above the ankle or
permanent total disability. wrist; 
3) permanent complete paralysis of two (2) limbs; 
4) brain injury resulting in incurable imbecility or
insanity; and 
3) Separation 5) such other cases as may be determined by the
SEC. 11. Separation Benefits. - The separation GSIS. 
benefits shall consist of:
a) a cash payment equivalent to one hundred Benefit: a monthly income benefit for life equal to the
percent (100%) of his average monthly basic monthly pension effective from the date of
compensation for each year of service he paid disability
contributions, but not less than Twelve thousand
pesos (P12,000) payable upon reaching sixty Qualifications:
(60) years of age upon separation, whichever 1) he is in the service at the time of disability; or 
comes later:  2) if separated from the service, he has paid at least
thirty-six (36) monthly contributions within the five
Provided, that the member resigns or separates (5) year period immediately preceding disability,
from the service after he has rendered at least or has paid a total of at least one hundred eighty
three (3) years of service but less than fifteen (180) monthly contributions, prior to his disability
(15) years; or  Note:
 Additional benefit: if at the time of disability, he
b) a cash payment equivalent to eighteen (18) times was in the service and has paid a total of at least
his basic monthly pension at the time of one hundred eighty (180) monthly contributions,
resignation or separation, plus an old-age in addition to the monthly income benefit, he shall
pension benefit equal to the basic monthly receive a cash payment equivalent to eighteen
pension payable monthly for life upon reaching (18) times his basic monthly pension
the age of sixty (60):   a member cannot enjoy the monthly income
benefit for permanent disability and the old-age
Provided, that the member resigns or separates retirement simultaneously. 
from the service after he has rendered at least  If a member who suffers permanent total
fifteen (15) years of service and is below sixty disability does not satisfy conditions therefor but
(60) years of age at the time of resignation or has rendered at least three (3) years of service at
separation.  the time of his disability, he shall be advanced the
cash payment equivalent to one hundred percent
SEC. 12. Unemployment or Involuntary Separation (100%) of his average monthly compensation for
Benefits. - Unemployment benefits in the form of each year of service he paid contributions, but
monthly cash payments equivalent to fifty percent not less than Twelve thousand pesos
(50%) of the average monthly compensation shall be (P12,000.00) which should have been his
paid to a permanent employee who is involuntarily separation benefit. 
separated from the service due to the abolition of his
office or position usually resulting from Unless the member has reached the minimum
reorganization:  retirement age, disability benefit shall be suspended
when: 
Provided, That he has been paying integrated 1) he is reemployed; or 
contributions for at least one (1) year prior to 2) he recovers from his disability as determined by
separation. the GSIS, whose decision shall be final and
binding; or 
4) Disability 3) he fails to present himself for medical
SEC. 15. General Conditions for Entitlement. - A examination when required by the GSIS. 
member who suffers permanent disability for reasons
not due to his grave misconduct, notorious Permanent Partial Disability Benefits
negligence, habitual intoxication, or willful intention to The following disabilities shall be deemed permanent
kill himself or another, shall be entitled to the benefits partial: 
provided for under Sections 16 and 17 immediately 1) complete and permanent loss of the use of: 
a) any finger 

83
 b) any toe  a) was in the service at the time of his death;
c) one arm  or 
d) one hand  b) if separated from the service, has at least
e) one foot  three (3) years of service at the time of his
f) one leg  death and has paid thirty-six (36) monthly
g) one or both ears  contributions within the five-year period
h) hearing of one or both ears  immediately preceding his death; or has paid
i) sight of both eyes  a total of at least one hundred eighty (180)
2) such other cases as my be determined by the monthly contributions prior to his death; or
GSIS.  2) the survivorship pension plus a cash payment
equivalent to one hundred percent (100%) of his
Benefit: a cash payment in accordance with a average monthly compensation for every year of
schedule of disabilities to be prescribed by the GSIS. service: Provided, That the deceased was in the
service at the time of his death with at least three
Qualification: he satisfies either of the conditions for (3) years of service; or 
qualification to permanent total disability. 3) a cash payment equivalent to one hundred
percent (100%) of his average monthly
Temporary Total Disability Benefits compensation for each year of service he paid
Benefit: seventy-five percent (75%) of his current daily contributions, but not less than Twelve thousand
compensation for each day or fraction thereof of pesos (P12,000.00): Provided,  That the
temporary disability benefit not exceeding one deceased has rendered at least three (3) years of
hundred twenty (120) days in one calendar year service prior to his death but does not qualify for
 if the disability requires more extensive treatment the benefits under item (1) or (2) of this
that lasts beyond one hundred twenty (120) days, paragraph.
the payment of the temporary total disability
benefit may be extended by the GSIS but not to The survivorship pension shall be paid as follows: 
exceed a total of two hundred forty (240) days.  1) when the dependent spouse is the only survivor,
 The temporary total disability benefit shall in no he/she shall receive the basic survivorship
case be less than Seventy pesos (P70.00) a day.  pension for life or until he/she remarries; 
2) when only dependent children are the survivors,
Qualifications: they shall be entitled to the basic survivorship
1) he is in the service at the time of his disability; or  pension for as long as they are qualified, plus the
2) if separated, he has rendered at least three (3) dependent children’s pension equivalent to ten
years of service and has paid at least six (6) percent (10%) of the basic monthly pension for
monthly contributions in the twelve-month period every dependent child not exceeding five (5),
immediately preceding his disability. counted from the youngest and without
substitution; 
Conditions: 3) when the survivors are the dependent spouse
1) Must suffer temporary total disability for reasons and the dependent children, the dependent
not due to any of the conditions enumerated in spouse shall receive the basic survivorship
Section 15 hereof; pension for life or until he/she remarries, and the
2) Must have exhausted all his sick leave credits dependent children shall receive the dependent
and collective bargaining agreement sick leave children’s pension mentioned in the immediately
benefits, if any. preceding paragraph (2) hereof.

Provided, however,  That a member cannot enjoy the In the absence of primary beneficiaries, the secondary
temporary total disability benefit and sick leave pay beneficiaries shall be entitled to: 
simultaneously. 1) the cash payment equivalent to one hundred
percent (100%) of his average monthly
5) Survivorship compensation for each year of service he paid
Sec. 20. Survivorship Benefits. - When a member or contributions, but not less than Twelve thousand
pensioner dies, the beneficiaries shall be entitled to: pesos (P12,000.00): Provided, That the member
1) the basic survivorship pension which is fifty is in the service at the time of his death and has
percent (50%) of the basic monthly pension; and  at least three (3) years of service; or 
2) the dependent children’s pension not exceeding 2) in the absence of secondary beneficiaries, the
fifty percent (50%) of the basic monthly pension benefits under this paragraph shall be paid to his
legal heirs.
Sec. 21. Death of a Member
Upon the death of a member, the primary For purposes of the survivorship benefits, legitimate
beneficiaries shall be entitled to:  children shall include legally adopted and legitimated
1) survivorship pension:  Provided, That the children. 
deceased: 

84
Death of a Pensioner.
Upon the death of an old-age pensioner or a member
receiving the monthly income benefit for permanent
disability, the qualified beneficiaries shall be entitled to
the survivorship pension defined in Section 20 of this
Act, subject to the provisions of paragraph (b) of
Section 21 hereof [survivorship pension conditions].
When the pensioner dies within the period covered
by the lump sum, the survivorship pension shall be
paid only after the expiration of the said period.  record in each of the Systems and shall be totalized
6) Funeral
The amount of the funeral benefits shall be
determined and specified by the GSIS in the rules and
regulations but shall not be less than Twelve
thousand pesos (P12,000.00): Provided, That it shall
be increased to at least Eighteen thousand pesos
(P18,000.00) after five (5) years and shall be paid
upon the death of: 
1) an active member; or 
 Active Member- A member who is not
separated from the service
2) a member who has been separated from the
service, but who may be entitled to future benefit
pursuant to Section 4 of this Act; or  Systems: Provided, however, That the amount of
 SEC. 4.  Effect of Separation from the
Service. - A member separated from the
service shall continue to be a member, and
shall be entitled to whatever benefits he has
qualified to in the event of any contingency
compensable under this Act.
3) a pensioner, as defined in Section 2 (o) of this
Act; or
 Pensioner - any person receiving old-age
permanent total disability pension or any
person who has received the lump sum
excluding one receiving survivorship pension
benefits as defined in Section 20 of this Act;
4) a retiree who at the time of his retirement was of
pensionable age under this Act but who opted to
retire under Republic Act No. 1616.
C. LIMITED PORTABILITY LAW
RA No 7699 was enacted to enable those from the
private sector who transfer to the government service
or from the government sector to the private sector to
the private sector to combine their years of service
and contributions which have been credited with the
SSS or GSIS, as the case may be, to satisfy the
required years of service for entitlement to the
benefits under the applicable laws.
“Totalization” shall refer to the process of adding up
the periods of creditable services or contributions
under each of the Systems, for purposes of eligibility
and computation of benefits.      Note: thus any employee is coverable by the GSIS or
 “Portability” shall refer to the transfer of funds for the
account and benefit of a worker who transfers from
one system to the other.
85
Sec. 3. Provisions of any general or special law or
rules and regulations to the contrary notwithstanding,
a covered worker who:
1) transfers employment from one sector to another
or
2) is employed in both sectors
shall have his credible services or contributions in
both Systems credited to his service or contribution
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:
Provided, however, That overlapping periods of
membership shall be credited only once for purposes
of totalization.
Sec. 4. All contributions paid by such member
personally, and those that were paid by his employers
to both Systems shall be considered in the processing
of benefits which he can claim from either or both
benefits to be paid by one System shall be in
proportion to the number of contributions actually
remitted to that System.
D. DISABILITY AND STATE BENEFITS
1. Labor Code, Employees Compensation and
State Insurance Fund
Employees Compensation Program - government
program that compensates employees and their
dependents for work-related sickness, injuries, or
deaths.
There are 2 separate and distinct State Insurance
Funds: one established under the SSS for private
sector employees; and the other under the GSIS for
public sector employees. The management and
investment of the Funds are done separately and
distinctly by the SSS and GSIS.
Coverage
Coverage in the State Insurance Fund shall be
compulsory upon all employers and their employees
not over sixty (60) years of age;
Provided, That an employee who is over sixty (60)
years of age and paying contributions to qualify for the
retirement or life insurance benefit administered by
the System shall be subject to compulsory coverage.
SSS should be compulsorily covered.
Effectivity: employees protected from the first day of
employment and employers obligated from the first
day of operation of business.
Benefits
What is compensated: incapacity to work resulting
from the illness, injury, or death
 Injury: Any harmful change in the human
organism from any accident arising out of and in
the course of employment.
 Death is the loss of life resulting from injury or
sickness (Labor Code, Art. 173[m])
 Sickness is any illness defined and accepted as
an occupational disease listed by the
Commission, or caused by employment, subject
to proof that the risk of contracting the same is
increased by work conditions
 Disability means loss or impairment of a physical
or mental function resulting from injury or
sickness
Rules on Compensability
1) For the injury and the resulting disability or death
to be compensable, the injury must be the result
of accident arising out of and in the course of the
employment (ECC Resolution No. 2799, 1984);
and
2) For the sickness and the resulting disability or
death to be compensable, the sickness must be
the result of an occupational disease listed under
the Annex “A” of the Rules dealing with
occupational diseases with the conditions set
therein satisfied.
Otherwise, proof must be shown that the risk of
contracting the disease is increased by the
working conditions [Theory of Increased Risks]
 What the law requires is reasonable work
connection and not a direct causal relation;
sufficient that the hypothesis on which
workmen’s claim is based is probable since
probability, not certainty, is the touchstone.
“Increased Risk” Jobs
a) Keeping the peace or guarding property
b) Keeping or carrying of money or valuables
c) Expose employee to direct contact with
lawless and irresponsible people
d) Bus driver, taxi driver, or street car conductor
(Batangas Transportation Co. v. Vda de
Rivera, G.R. No. L-7658, 1956)
e) Expose employee to illness; and
f) Prolonged sitting down and putting off
urination. (Barrios v. ECC, G.R. No. 148089
March 24, 2006)
3) Only injury or sickness that occurred on or after
January 1, 1975 and the resulting disability or
death shall be compensable (ECL Rules, Sec. 1,
Rule III)
Limitations – No compensation
86
No compensation shall be allowed to the employee or
his dependents when the injury, sickness, disability, or
death was occasioned by any of the following:
1) His intoxication;
o Intoxication alone is not sufficient to defeat
the recovery of compensation when
intoxication does not incapacitate the
employee from performing his functions and
duties and from following his occupation
2) His willful intention to injure or kill himself or
another; or
o Sufficient proof of insanity or mental sickness
may be presented to negate the requirement
of willfulness as a matter of counter-defense
3) His notorious negligence (Labor Code, Art. 178;
ECL Rules, Sec. 1, Rule IV)
Direct Premises Rule
The accident should have occurred at the place of
work to be compensable.
Exceptions:
1. Where the employee is proceeding to or from his
work on the premises of his employer;
2. Where the employee is about to enter or about to
leave the premises of his employer by way of the
exclusive or customary means of ingress and
egress;
3. Where the employee is charged, while on his way
to or from his place of employment or at his
home, or during his employment, with some duty
or special errand connected with his employment;
and
4. Where the employer, as an incident of the
employment, provides the means of
transportation to and from the place of
employment (Iloilo Dock and Engineering Co. v.
WCC, G.R. No. L-26341, 1978)
5. 24-Hour Duty Doctrine - members of the
national police by the nature of their functions are
technically on duty 24 hours a day, except when
they are on vacation leave.
6. Bunkhouse rule – where the employee is
required to stay in the premises or in quarters
furnished by the employer, injuries sustained
therein are in the course of employment
regardless of the time same occurred.
The 24-hour duty doctrine should not be sweepingly
applied to all acts and circumstances causing the
death of a police officer but only to those which,
although not on official line of duty, are nonetheless
basically police service in character. (Tancinco v.
GSIS, G.R. No. 132916, 2001)
Force majeure
General Rule: Employer is not responsible.
Exception: Positional and local risks doctrine
When one in the course of his employment is
reasonably required to be at a particular place at a
particular time and there meets an accident, although
one which any other person then and there present
would have meet irrespective of his employment, that
accident is one arising out of the employment if the
person is so injured.
 Accident is an unintended and unforeseen
injurious occurrence; something that does not
occur in the usual course of events or that could
not be reasonably anticipated
 An “assault” although resulting from a
deliberate act of the slayer, is considered an
“accident” under the law, since the word
“accident” is intended to indicate that “the act
causing the injury shall be casual or
unforeseen, an act for which the injured party
is not legally responsible
Thus, the death of an employee due to a murderous
assault is compensable when the same occurred in
the course of performance of official functions.
The motive of assault need not be established if the
covered employee sustained the injury while:
1) The employee was at the assigned/designated
workplaces; or
2) The employee was executing orders of the
employer, regardless of the time and place of the
incident.
Benefits
Source of compensation: State Insurance Fund
Medical Benefits
Any employee shall be entitled to such medical
services, appliances and supplies as the nature of his
disability and the progress of his recovery may
require, subject to the expense limitation as contained
in Annex "C" hereof, if all of the following conditions
are satisfied:
1) He has been duly reported to the System;
2) He sustains an injury or contracts sickness; and
3) The System has been duly notified of the injury or
sickness.
The employee is entitled to the benefits only of the
ward services of an accredited hospital and
accredited physician. However, if the employee
chooses accommodations better than ward services
the excess of the total amount of expenses incurred
over the benefits provided under Annex "C" hereof,
shall be borne by the employee.
Further, the hospital shall provide all the medicines,
drugs, or supplies necessary for the treatment of the
employee at a cost not exceeding the retail prices
prevailing in local drug stores.
Loss of wages or earning capacity not required
Art 191 of the Labor Code does not require as a
prerequisite for the grant of medical benefits that the
injured employee should lose wages or earning
87
capacity. The employee is “immediately” entitled to be
provided during the subsequent period of his disability
with such medical services and appliances as the
nature of his sickness or injury and progress of his
recovery may require.
Rehabilitation Benefits
Person with Work-Related Disability (PWRD) – a
worker who has suffered from a work-connected
disease or injury adversely affecting the earning
capacity.
Rehabilitation - the process by which there is provided
a balanced program of remedial treatment, vocational
assessment, and preparation, designed to meet the
individual needs of each handicapped employee to
restore him to suitable employment, including
assistance as may be within its resources to help
each rehabilitee to develop his mental, vocational, or
social potential
Disability Benefits
Disability means the loss or damage of a physical or
mental function resulting from an injury or sickness
that prevents an employee from performing his/her
work, or from being engaged in any gainful
occupation.
3 kinds of disability benefits under the Labor Code, as
amended by PD 626:
1) Temporary total disability;
o Purpose is to compensate him for what he
might have earned during the period while
his injury or sickness is being medically
treated.
2) Permanent total disability and 3) permanent
partial disability.
o Purpose is to compensate him for the actual
and permanent loss of physical or mental
function of his body.
Having different purposes, benefits may be claimed
for both, eg., recovery of compensation for temporary
total or permanent partial disability shall not preclude
recovery for permanent total disability.
Total Disability
Temporary - if as a result of the injury or sickness the
employee is unable to perform any gainful occupation
for a continuous period not exceeding 120 days,
except when such disability still requires medical
attendance beyond 120 days, but not to exceed 240
days.
 Benefit: an income benefit equivalent to 90
percent (90%) of his average daily salary credit,
subject to the condition that the daily income
benefit shall not be less than P10.00 nor more
than P200.00 nor paid longer than 120 days for
the same disability, unless the injury or sickness
requires more extensive treatment that lasts
beyond 120 days, but not to exceed 240 days
from onset of disability, in which case he shall be
 paid benefit for temporary total disability during
the extended period.
Permanent - if as a result of the injury or sickness the
employee is unable to perform any gainful occupation
for a continuous period exceeding 120 days.
 The fact that the permanently and totally disabled
employee continues to work after such disability
does not deprive him of the benefits provided
under the law. What is important is the inability to
do substantially all material acts necessary for
the prosecution of a gainful occupation without
serious discomfort or pain and without material
injury or danger to life.
 It is not the injury per se which is compensated,
but the incapacity to work.
 Benefit: the income benefit shall be paid
beginning on the first month of such disability.
 Except as otherwise provided for in other laws,
decrees, orders, or letters of instructions, the
monthly income benefit shall be guaranteed for
five (5) years and shall be suspended under any
of the following conditions:
a) Failure to present himself for
examination at least once a year upon
notice by the System
b) Failure to submit a quarterly medical
report certified by his attending
physician as required under Sec. 5 of
Rule IV hereof;
c) Complete or full recovery from his
permanent disability; or
d) Upon being gainfully employed.
Permanent Partial Disability – if, as a result of the
injury or sickness, the employee suffers a permanent
partial loss of the use of any part of his body.
 Benefit: the income benefit shall be paid
beginning on the first month of such disability, but
not longer than the designated number of months
in accordance with the schedule under PD 626.
 If the number of months exceed twelve, it shall be
a monthly pension. Otherwise, the System may
pay income benefit in lump sum or monthly
pension.
NOTE: a person’s disability may not manifest fully at
one precise moment in time but rather over a period
of time. It is possible that an injury which first was
considered to be temporary may later on become
permanent or one who suffers a partial disability
becomes totally and permanently disabled from the
same cause.
When temporary total disability becomes
permanent total disability
1. Declared by the company-designated physician
within 120 or 240 day treatment period; or
2. In case of absence of such a declaration either of
fitness or permanent total disability, upon the
lapse of the 120 or 240 day treatment period,
while the employee’s disability continues and he
88
is unable to engage in gainful employment during
such period, and the company physician fails to
arrive at a definite assessment of the employee’s
fitness or disability (Alpha Ship Management v.
Calo, G.R. No. 192034, 2014)
If the company-designated physician fails to make a
full, complete and definitive assessment beyond this
period, the seafarer’s disability becomes permanent
and total. Without a valid final and definitive
assessment from the company-designated physician,
the employee’s temporary and total disability became
permanent and total by operation of law. (Orient Hope
Agencies, Inc. v. Jara, G.R. No. 204307, June 6,
2018.)
An interim disability grading is merely an initial
prognosis and does not provide sufficient basis for an
award of disability benefits. Failure to issue a fit-to
work certification or a final disability rating after an
employee’s operation and before the lapse of 240
days from his repatriation renders the employee as
permanently and totally disabled. (Sharpe Sea
Personnel, Inc. v. Mabunay, G.R. No. 206113,
November 6, 2017.)
When referral to a third doctor mandatory
If an employee-designated physician disagrees with
the company-designated physician, a third doctor may
be agreed jointly between the employer and the
seafarer. The third doctor's decision shall be final and
binding on both parties. The assessment referred to is
the declaration of fitness to work or the degree of
disability. It presupposes that the company-
designated physician came up with a valid, final, and
definite assessment on the seafarer's fitness to work
before the 120-day or 240-day period expires.
Referral to a third doctor is mandatory when:
1) there is a valid and timely assessment made by
the CDP; and
2) the seafarer's appointed doctor refuted such
assessment.
3)
These 2 conditions must be present to trigger the
mandatory rule on third doctor referral. It is the
seafarer's duty to signify the intention to resolve the
conflict through the referral to a third doctor. If the
seafarer does not contest the findings and fails to
refer the assessment to a third doctor, the company
can insist on its disability rating even against a
contrary opinion by another physician.
Death Benefit
The beneficiaries of a deceased employee shall be
entitled to an income benefit if all of the following
conditions are satisfied:
1) The employee had been duly reported to the
System;
2) He died as a result of an injury or sickness; and
3) The System has been duly notified of his death,
as well as the injury or sickness which caused his
death.

His employer shall be liable for the benefit if such

death occurred before the employee is duly reported
for coverage to the System.

If the employee has been receiving monthly income

benefit for permanent total disability at the time of his
death, the surviving spouse must show that the
marriage has been validly subsisting at the time of his
disability, and that the cause of death must be a
complication or natural consequence of the
compensated Permanent Total Disability.

For primary beneficiaries: the income benefit shall be

paid beginning at the month of death and shall
continue to be paid for as long as the beneficiaries are
entitled thereto.
Qualifications:
1) Legitimate surviving spouse – as long as
he/she has not remarried;
2) Dependent children:
a) Not gainfully employed;
b) Unmarried; and
c) Over 21 years of age provided he/she is
incapable of self-support due to a
physical or mental defect which is
congenital or acquired during minority.

For secondary beneficiaries: the income benefit shall

be sixty (60) times the monthly income benefit of a
primary beneficiary which in no case [shall] be less
than P15,000.00, which shall likewise be paid in
monthly pension 

Funeral Benefit
A funeral benefit of P20,000 shall be paid upon the
death of a covered employee or permanently totally
disabled pensioner to one of the following:
1) the surviving spouse; or
2) the legitimate child who spent for the funeral
services; or
3) any other person who can show incontrovertible
proof of his having borne the funeral expenses.

89
 VIII. JURISDICTION AND REMEDIES
Preliminaries
GR: The existence of ER-EE relationship between the
parties-litigants or a reasonable causal connection to
such relationship is a prerequisite for the exercise of
jurisdiction over a labor dispute by the labor tribunals.
 Reasonable causal connection rule – if there is a
reasonable causal connection between the claim
asserted and the employer-employee relations,
then the case is within the jurisdiction of labor
courts. In the absence of such nexus, it is the
regular courts that have jurisdiction.
XPN: in cases filed by OFWs, the Labor Arbiters may
exercise jurisdiction even absent the employment
relationship.
 Sec 10, RA 8042: LA may exercise jurisdiction
over claims of OFWs arising out of: 1) an ER-EE
relationship; or 2) by virtue of any law or contract
involving Filipino workers for overseas
deployment.
Note: Labor cases are not subject to brgy conciliation
proceedings.
A. Labor Arbiter
The Labor Arbiter is an official in the Regional
Arbitration Branch of the NLRC.
Besides their adjudicatory power to hear and decide
cases over which they have jurisdiction, the Labor
Arbiters have 1) contempt power;1 and 2) the power to
conduct ocular inspection.2
NOTE: the previous grant of injunctive power to the
LAs was deleted in the recent NLRC Rules. Thus, the
Las has no more injunctive power. Only the NLRC
has that power.
Article 224. Jurisdiction of the Labor Arbiters and the
Commission. – TUMODS
(a) Except as otherwise provided under this Code,
the Labor Arbiters shall have original and
exclusive jurisdiction to hear and decide, within
thirty (30) calendar days after the submission of
the case by the parties for decision without
extension, even in the absence of stenographic
1
ARTICLE 225. [218] Powers of the Commission. — The
Commission shall have the power and authority: xxx (d)To
hold any person in contempt directly or indirectly and impose
appropriate penalties therefor in accordance with law.
2
ARTICLE 226. [219] Ocular Inspection. — The
Chairman, any Commissioner, Labor Arbiter or their duly
authorized representatives, may, at any time during
working hours, conduct an ocular inspection on any
establishment, building, ship or vessel, place or premises,
including any work, material, implement, machinery,
appliance or any object therein, and ask any employee,
laborer, or any person, as the case may be, for any
information or data concerning any matter or question
relative to the object of the investigation.
90
notes, the following cases involving all workers,
whether agricultural or non-agricultural:
1. Termination disputes;
o In case of conflict between the
jurisdiction of a Labor Arbiter and a
Voluntary Arbitrator, the Labor Arbiter’s
jurisdiction shall prevail.
 Ratio: termination is not a grievable
issue. Even if provided for in the
CBA, this is merely discretionary
upon the parties. Once there is
actual termination, jurisdiction is
conferred upon LA by operation of
law.
 Further, interpretation of the CBA
and enforcement of company
policies are merely corollary to the
illegal dismissal case.
o A Voluntary Arbitrator will only have
jurisdiction over illegal dismissal cases
where there is an express agreement of
the parties to the CBA.
2. Unfair labor practice cases;
o Only the civil aspect; criminal aspect –
regular courts
o Note also that recovery of civil liability in
the admin proceedings bars recovery
under Civil Code
o Remember further that violations of
CBA should be resolved through the
grievance machinery, and if unresolved,
through Voluntary Arbitrators.
o Only gross violations (malicious and
flagrant refusal to comply with economic
provisions) amount to ULP and are
under the jurisdiction of the Labor
Arbiter.
o The LA also has jurisdiction over ULP
cases filed by a union member against
his union, eg, suspension and expulsion
w/o affording the member the right to
appeal. This is not an intra-union
dispute, but a ULP.
3. [Money Claims with Reinstatement]
If accompanied with a claim for
reinstatement, those cases that workers may
file involving wages, rates of pay, hours of
work and other terms and conditions of
employment;
o This presupposes that it proceeds from
a termination case, it being
accompanied with a claim for
reinstatement. Hence, it falls within the
jurisdiction of the LA.
4. [Other Money Claims Exceeding P5k]
Except claims for Employees Compensation,
Social Security, Medicare and maternity
 benefits, all other claims arising from
employer-employee relations, including
those of persons in domestic or household
service, involving an amount exceeding five
thousand pesos (P5,000.00) regardless of
whether accompanied with a claim for
reinstatement.
o This does not necessarily arise from a
termination case, but because the
amount exceeds P5k, it falls within the
jurisdiction of LA.
o Thus includes a case for claim for
notarial fees by a lawyer employed by a
company.
o If it does not exceed P5k, it is the
Regional Director or his duly authorized
hearing officers who have jurisdiction to
take cognizance thereof.
NOTE: the original and exclusive jurisdiction
of the Labor Arbiter over cases for money
claims is limited only to those arising from
statutes or contracts other than a CBA.
 The Voluntary Arbitrators have original
and exclusive jurisdiction over money
claims arising from the interpretation or
implementation of the CBA, and those
arising from the interpretation or
enforcement of company personnel
policies.
5. Claims for actual, moral, exemplary and
other forms of damages arising from the
employer-employee relations;
6. Cases arising from any violation of Article
279 of this Code, including questions
involving the legality of strikes and lockouts;
and
o Art 279 – prohibited activities during
strikes and lockouts
o The Labor Arbiter has the power to
determine questions involving the
legality or illegality of a strike or lockout
upon filing of a proper complaint and
after due proceedings.
o XPNS:
a) When the Secretary/President has
assumed jurisdiction;
b) the Labor Arbiter cannot adjudicate
issues involving any crimes
committed, whether related to the
strike or lockout or not. Prosecution
of crimes or felonies falls within the
jurisdiction of the regular courts of
justice.
(b) The Commission shall have exclusive appellate
jurisdiction over all cases decided by Labor
Arbiters.
(c) Cases arising from the interpretation or
implementation of collective bargaining
91
agreements and those arising from the
interpretation or enforcement of company
personnel policies shall be disposed of by the
Labor Arbiter by referring the same to the
grievance machinery and voluntary arbitration as
may be provided in said agreements.
GR: the jurisdiction conferred by Article 225 is original
and exclusive. Hence, no other officers or tribunals
can take cognizance of, or hear and decide, any of
the cases enumerated therein.
XPNs:
1) When the DOLE Secretary or President exercises
their assumption powers over disputes causing or
likely to cause a strike or lockout in industries
indispensable to national interest;
2) When the NLRC exercises its power of
compulsory arbitration over cases certified to it by
the DOLE under Art 278 (strike/lockouts);
3) When the parties agree to submit the case to
voluntary arbitration.
Jurisdiction of the Labor Arbiter provided in other
provisions of the Labor Code and Special Laws
1) Disputes involving legislated wage increases and
wage distortion in UNORGANIZED
establishments not voluntarily settled by the
parties;
o if the establishment is organized, RA 6727
vests upon the Voluntary Arbitrators the
jurisdiction to hear and decide the wage
distortion cases, after the grievance
procedure in the CBA failed to settle the
same.
2) Contested cases under Article 128 (b), where
the employer contests the findings of the labor
employment and enforcement officer in relation to
the compliance/non-compliance by the employer
with labor standards.3
For the LA to have jurisdiction thereunder, the ff
requisites must concur:
3
Art. 128 (b): Notwithstanding the provisions of Articles 129
and 217 of this Code to the contrary, and in cases where the
relationship of employer-employee still exists, the Secretary
of Labor and Employment or his duly authorized
representatives shall have the power to issue compliance
orders to give effect to the labor standards provisions of this
Code and other labor legislation based on the findings of
labor employment and enforcement officers or industrial
safety engineers made in the course of inspection. The
Secretary or his duly authorized representatives shall issue
writs of execution to the appropriate authority for the
enforcement of their orders, except in cases where the
employer contests the findings of the labor employment and
enforcement officer and raises issues supported by
documentary proofs which were not considered in the
course of inspection.
 a) The employer contests the findings of the
labor inspector and raises issues not
considered in the course of inspection;
b) In order to resolve such issues, there is a
need to examine evidentiary matters; and
c) Such matters are not verifiable in the normal
course of inspection.
3) Enforcement of compromise agreements where
there is non-compliance by any of the parties
thereto;4
o In accordance with Art 233, although the
compromise agreements may have been
entered into by the parties before the BLR or
the DLE Regional Office, it is the Labor
Arbiter who has jurisdiction to take
cognizance of the following issues related
thereto:
a) to enforce the compromise agreement
in case of non-compliance therewith by
the parties thereto; or
b) To nullify it if there is prima facie
evidence that the settlement was
obtained through fraud,
misrepresentation, or coercion.
4) Issuance of writ of execution to enforce decisions
of Voluntary Arbitrators in case of their absence
or incapacity for any reason
o GR: the decisions of the voluntary arbitrator,
once final and executory, may be enforced
through he writ of execution issued by the
same voluntary arbitrator
o XPN: where the VA who rendered the
decision is absent or incapacitated for any
reason, Art 276 grants jurisdiction to any LA
in the region where the party resides to take
cognizance of a motion for the issuance of
the writ of execution filed by such party.
5) Money claims arising out of ER-EE or by virtue of
any law or contract involving Filipino workers for
overseas deployment,, including claims for death
and disability benefits and for actual, moral,
exemplary damages as provided by RA 8042.5
4
ART. 233. [227] Compromise Agreements. Any
compromise settlement, including those involving labor
standard laws, voluntarily agreed upon by the parties with
the assistance of the Bureau or the regional office of the
Department of Labor, shall be final and binding upon the
parties. The National Labor Relations Commission or any
court, shall not assume jurisdiction over issues involved
therein except in case of non-compliance thereof or if there
is prima facie evidence that the settlement was obtained
through fraud, misrepresentation, or coercion.
5
SEC. 10. MONEY CLAIMS. – Notwithstanding any
provision of law to the contrary, the Labor Arbiters of the
National Labor Relations Commission (NLRC) shall have the
original and exclusive jurisdiction to hear and decide, within
ninety (90) calendar days after filing of the complaint, the
claims arising out of an employer-employee relationship or
by virtue of any law or contract involving Filipino workers for
overseas deployment including claims for actual, moral,
92
o if there is a CBA between the foreign
employer and the bargaining union of the
OFWs, the jurisdiction over monetary claims
is vested in the Voluntary Arbitrator, not the
Labor Arbiter.
o Contra – jurisdiction of the POEA, to wit:
a) all cases which are administrative in
character, involving or arising out of
violations of rules and regulations
relating to licensing and registration of
recruitment and employment agencies
or entities.
b) Disciplinary action cases and other
special cases which are administrative
in character, involving employers,
principals, contracting partners and
Filipino migrant workers.
Cases over which the Labor Arbiter have NO
jurisdiction:
1) Claims for damages arising from breach of non-
compete clause and other post-employment
prohibitions
 jurisdiction over which is to the regular courts
since they are civil in nature;
2) Claims for payments of cash advances, car
appliance, and other loans of employees;
- Jurisdiction also with the regular courts;
- Where the claim to the principal relief sought
is to be resolved not by reference to the
Labor Code, other labor statutes, or the
CBA, but by reference to the civil law, the
jurisdiction over the dispute belongs to the
regular courts.
3) Dismissal of corporate officers and their monetary
claims;
4) Cases involving immunities from suit;
- Eg, illegal dismissal case against Asian
Development Bank, specialized agencies of
the UN, etc. This immunity extends to its
officers who also enjoy immunity with respect
to all acts performed by them in their official
capacity.
- XPN: when the function of the foreign entity
otherwise immune from suits partake of the
nature of a proprietary activity, eg, restaurant
services offered at John Hay Air Station
undertaken by the US Govt.
5) Cases falling under the doctrine of forum non-
conveniens;
6) Quasi-delict or tort cases;
 Tolosa case: heirs of Captain Tolosa filed a
case against shipmates allegedly for gross
negligence of the latter; no ER-EE rel
7) Criminal and civil liabilities arising from violations
of certain provisions of the Labor Code, including:
a) Violations of rights and conditions union
membership;
b) Unfair labor practice.
exemplary and other forms of damages.
8) Constitutionality of CBA provisions.
 Halagueña case: discrimination in the CBA
providing that retirement age for men is 60
while 55 for women.
 Issue involves application of Constitution and
CEDAW, not labor statutes.
1. Jurisdiction of the Labor Arbiter as
distinguished from the Regional Director
Money Claims
Under Art 129, it is the DOLE Regional Directors or
the duly authorized hearing officer who are
empowered, in a summary proceeding, to hear and
decide small money claims that does not exceed
P5,000, provided the following requisites concur:
1) The claim must arise from employer-employee
relationship;
2) The claimant does not seek reinstatement; and
3) The aggregate money claim of each employee
does not exceed P5,000.
Visitorial and Enforcement Power
Art 128 grants to the DOLE Regional Director, as
representative of the DOLE Secretary, the power to
conduct inspection of establishments to determine
compliance with labor laws, rules, and regulations.
However, before the visitorial and enforcement power
may be exercised, the following requisites should
concur:
1) The employer-employee relationship should still
exist;
2) The findings in question were made in the course
of inspection by labor inspectors; and
3) The employees have not yet initiated any claim or
complaint with the Labor Arbiter under Art 224.
o Ratio: if the action has already been filed
under Art 224, the DOLE Regional Director
can no longer exercise jurisdiction thereover.
2. Requirements to perfect appeal to the NLRC
ARTICLE 229. [223] Appeal. —
“Decisions, awards, or orders of the Labor Arbiter
are final and executory unless appealed to the
National Labor Relations Commission by any or
both parties within ten (10) calendar days from
receipt of such decisions, awards, or orders. Such
appeal may be entertained only on any of the
following grounds:
a. If there is prima facie evidence of abuse of
discretion on the part of the Labor Arbiter;
b. If the decision, order or award was secured
through fraud or coercion, including graft and
corruption;
c. If made purely on questions of law; and
d. If serious errors in the findings of facts are
raised which would cause grave or irreparable
damage or injury to the appellant.
In case of a judgment involving a monetary award,
an appeal by the employer may be perfected only
93
upon the posting of a cash or surety bond issued
by a reputable bonding company duly accredited
by the Commission in the amount equivalent to the
monetary award in the judgment appealed from.
In any event, the decision of the Labor Arbiter
reinstating a dismissed or separated employee,
insofar as the reinstatement aspect is concerned,
shall immediately be executory, even pending
appeal. The employee shall either be admitted
back to work under the same terms and conditions
prevailing prior to his dismissal or separation or, at
the option of the employer, merely reinstated in the
payroll. The posting of a bond by the employer
shall not stay the execution for reinstatement
provided herein.
To discourage frivolous or dilatory appeals, the
Commission or the Labor Arbiter shall impose
reasonable penalty, including fines or censures,
upon the erring parties.
In all cases, the appellant shall furnish a copy of
the memorandum of appeal to the other party who
shall file an answer not later than ten (10) calendar
days from receipt thereof.
The Commission shall decide all cases within twenty
(20) calendar days from receipt of the answer of the
appellee.
The decision of the Commission shall be final and
executory after ten (10) calendar days from receipt
thereof by the parties.
Any law enforcement agency may be deputized by
the Secretary of Labor and Employment or the
Commission in the enforcement of decisions,
awards or orders.”
Requisites for the perfection of an appeal from
the Labor Arbiter to the NLRC:
1) The Memorandum of Appeal must be filed
within 10 days from the receipt of the decision,
order, or award appealed from;
o Memorandum must be verified and should
contain a statement of the date the
appellant received the appealed decision,
award, or order
o Need not contain a certificate of non-
forum shopping (not an initiatory
complaint)
2) Payment of the appeal and legal research fee;
3) Proof of service to the other party; and
4) In case of monetary awards, posting of cash,
property, or surety bond.
Reglementary Periods for Appeal to the NLRC:
1) From the decision of the Labor Arbiter:
a) 10 calendar days – general rule
b) 5 calendar days – appeals in contempt
cases decided by the Labor Arbiter
2) From the decision of the DOLE Regional
Director: 5 calendar days – for small money
claims of P5,000 or less.
NOTE:
 Calendar days, not working days. Hence,
Saturdays, Sundays, and legal holidays are
included in reckoning and computing the
reglementary period.
 Date of mailing by registered mail of the
memorandum of appeal is the date of its filing
 Motion for extension of time to appeal/file appeal
bond is not allowed.
Appeal Bond
Only in case the decision of the LA or the DOLE RD
for small claims cases involves a monetary award that
an appeal by the employer may be perfected upon the
posting of a bond, which shall either be in the form of
a cash deposit, surety bond, or property6 bond.
 Posting of a bank guarantee/certification not
sufficient.
If a party failed to perfect his appeal by non-payment
of the appeal bond within the 10-calendar day period
provided by law, the decision of the Labor Arbiter
becomes final and executory upon the expiration of
the said period.
Motion to Reduce Appeal Bond
GR: the appeal bond that should be posted should be
equivalent to the monetary award of the Labor Arbiter,
exclusive of damages and attorney’s fees. Its
reduction is neither provided in the Labor Code nor in
its implementing rules.
XPN: by virtue of practice and jurisprudence, a motion
to reduce the appeal bond to a reasonable amount for
meritorious reasons is allowed.
McBurnie Doctrine: Guidelines for Filing and
Acceptance of Motions to Reduce Bond
a) The filing of a motion to reduce appeal bond shall
be entertained by the NLRC subject to the
following conditions:
(1) there is meritorious ground; and
(2) a bond in a reasonable amount is posted;
b) For purposes of compliance with condition no.
(2), the motion shall be accompanied by the
posting of a provisional cash or surety bond
equivalent to ten percent (10%) of the monetary
award subject to the appeal, exclusive of
damages and attorney's fees;
c) Compliance with the foregoing conditions shall
suffice to suspend the running of the 10-day
6
UERM vs NLRC: though not mentioned in the codal,
posting of real property bond in lieu of cash or surety bond is
sufficient protection for the interests of the employees should
they finally prevail.
94
reglementary period to perfect an appeal from the
labor arbiter's decision to the NLRC;
d) The NLRC retains its authority and duty to
resolve the motion to reduce bond and determine
the final amount of bond that shall be posted by
the appellant, still in accordance with the
standards of meritorious grounds and reasonable
amount; and
e) In the event that the NLRC denies the motion to
reduce bond, or requires a bond that exceeds the
amount of the provisional bond, the appellant
shall be given a fresh period of ten (10) days from
notice of the NLRC order within which to perfect
the appeal by posting the required appeal bond.
3. Reinstatement and/or execution pending appeal
Reinstatement issued by the LA is immediately and
self-executory even pending appeal by the employer.
This means that while the perfection of an appeal
shall stay the execution of the decision of the LA, the
exception is in respect to the execution of the
reinstatement order which should proceed even
pending appeal by the employer.
This reinstatement pending appeal is applicable
SOLELY to the Labor Arbiter’s Order.
 If the reinstatement order is issued by the NLRC
on appeal, or by the CA or SC, there is a need to
secure a writ of execution from the Labor Arbiter
of origin to enforce the reinstatement of the
employee whose dismissal is declared illegal.
It is required that in case the decision of the Labor
Arbiter includes an order of reinstatement, it should
contain:
a) reinstatement aspect is immediately executory;
and
b) a directive for the employer to submit a report of
compliance within 10 calendar days from receipt
of the said decision.
As a consequence of disobedience, the employer has
the following liabilities:
1) he shall be liable to pay the accrued salaries of
the reinstated employee as a consequence of
such non-reinstatement in the amount specified
in the decision; and
2) he may be cited for contempt.
o The contempt remedy, however, is available
only after the sheriff shall have served the
writ of execution upon the employer or any
other person required by law to obey the
same.
Note, further, that the failure of employee ordered
reinstated pending appeal to report back to work as
directed by the employer does NOT give the employer
the right to remove him, especially when there is a
reasonable explanation for his failure.

The employer has no way of staying the execution of
immediate reinstatement. He cannot post bond to
prevent its execution.
While he may apply for a TRO with the CA/SC, the
issuance thereof merely suspends the implementation
and enforcement of the reinstatement order but it
does not have the effect of nullifying the right of the
employee to his reinstatement and to be paid his
reinstatement wages.
Reversal of LA’s Reinstatement Order
From the moment an employee is ordered reinstated
by the LA on the basis of the finding that his dismissal
is illegal, up to the time that an appellate tribunal like
the NLRC, CA, or SC reverses said finding, the
employee is entitled to his reinstatement
salaries/wages and regular allowances, benefits,
incentives, and bonuses.
If unpaid, the employer’s success in having the
decision of the LA reversed on appeal will not
exculpate him from the liability to pay the
reinstatement wages and benefits of the employee,
reckoned and computed from the time the employee
was ordered reinstated by the LA until the date of
reversal on appeal. (Roquero Doctrine)
o XPN: the employee may be barred from
collecting the accrued wages if it is shown that
the delay in enforcing the reinstatement pending
appeal was without fault on the part of the
employer, eg., when the employer is placed on
rehabilitation and therefore all claims against it
was suspended.
Further, if the employee has been reinstated during
the appeal period and such reinstatement order is
subsequently reversed on appeal with finality, the
employee is not required to reimburse whatever
salaries he has received for he is entitled to such,
more so if he actually rendered services during the
said period.
 This is true even if he was merely reinstated in
the payroll.
 Garcia doctrine: the refund doctrine (previous
rulings) easily demonstrates how a favorable
decision by the LA could harm, more than help, a
dismissed employee. The employee, to make
both ends meet, would necessarily have to use
up the salaries received during the pendency of
the appeal, only to end up having to refund the
sum in case of a final unfavorable decision.
B. National Labor Relations Commission
Exclusive Original Jurisdiction:
a) Petition for injunction in strikes or lockouts
b) Certified cases which refer to labor disputes
causing or likely to cause a strike or lockout in an
industry indispensable to the national interest,
certified to it by the Secretary of Labor and
Employment for compulsory arbitration
95
c) Petition for extraordinary remedies from orders or
resolutions of Labor Arbiters.
d) Petitions for injunction in ordinary labor disputes.
Exclusive Appellate Jurisdiction:
a) All cases decided by the Labor Arbiters;
b) Cases decided by the DOLE Regional Directors
or hearing officers involving small money claims;
and
c) Contempt cases decided by the Labor Arbiters.
Judicial Review of Labor Rulings
C. Court of Appeals
From DOLE Secretary, NLRC, BLR  CA: Petition
for Certiorari under Rule 65
There is no appeal from the decisions, orders, or
awards of any of the following labor officials:
a) DOLE Secretary;
b) NLRC; and
c) Director of the Bureau of Labor Relations in
cases decided by him in his appellate jurisdiction
o As distinguished from those he decides in his
original jurisdiction which are appealable to
the DOLE Secretary.
The only mode by which labor cases decided by
the aforementioned may reach the Court of
Appeals is through a Rule 65 petition for
certiorari. Thus:
1) Grounds: GADLEJ;
2) Motion for reconsideration is mandatory and
jurisdictional;
3) Period within which to file certiorari petition: 60
days from notice of judgment, order, or
resolution;
4) In case MR or Motion for New Trial is filed, the
60-day period is reckoned and computed from
notice of the denial of said motion;
5) The 60-day period is reckoned from receipt of the
decision by counsel or representative of record,
not by litigant-party.
6) Certificate of non-forum shopping is required;
7) No bond required.
From Voluntary Arbitrator  CA: Petition for
Review under Rule 43
Being a quasi-judicial agency, the decisions and
awards of a voluntary arbitrator are appealable by
way of a petition for review to the CA, similar to a
decision of an RTC.
A. Grounds:
1) Lack or want of jurisdiction;
2) Grave abuse of discretion;
3) Violation of due process;
4) Denial of substantive justice;
5) Erroneous interpretation of the law.
B. Period to appeal – Guagua Doctrine
The 10-calendar day period stated in Art 276 should
be understood as the period within which the party
adversely affected may file a Motion for
Reconsideration.
Only after the resolution of the MR may the aggrieved
party appeal to the CA by filing the petition for review
under Rule 43 within 15 days from notice.
C. Payment of appeal docket fee within prescribed
period both mandatory and jurisdictional.
D. Supreme Court
Since the CA has jurisdiction over the petition for
certiorari under Rule 65 that may be filed before it
from the decisions of the NLRC, the DOLE Secretary,
or the BLR Director, any alleged errors committed by
it in the exercise of its jurisdiction would be errors of
judgment reviewable by the Supreme Court by
means of petition for review on certiorari under
Rule 45.
Period to appeal: 15 days from notice of judgment or
denial of motion for reconsideration.
 Neypes rule: fresh 15 day period afforded to
litigants within which to appeal from denial of MR.
This rule applies R43 appeals to the CA. and R45
appeals by certiorari to the SC
E. Bureau of Labor Relations
ARTICLE 232. [226] 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, on:
1) all inter-union and intra-union conflicts, and
2) 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.
“Labor Relations Divisions or LRD” refers to the
following units in the DOLE Regional Office: 1)
Labor Organization and CBA Registration Unit; and
2) Med-Arbitration Unit.
Thus, the BLR or LRD have concurrent jurisdiction
over the cases mentioned in Art 232. Specifically,
the following hierarchy in exercising jurisdiction is
followed:
1) Med-Arbiter;
2) DOLE Regional Directors; and
3) BLR Director.
Med-Arbiter
Authorized to hear and decide:
1) Representation cases;
2) Inter-union or intra-union disputes; and
3) Other labor related relations disputes, except
96
those falling under the exclusive and original
jurisdiction of the DOLE Regional Director.
Generally, decisions of the Med-Arbiter on the
foregoing are appealable to the BLR Director, with
the sole exception of inter-union disputes, which
are appealable to the DOLE Secretary.
DOLE Regional Director
The RDs are the duly authorized representatives of
the DOLE Secretary in the DOLE Regional Offices.
They are in charge of the administration and
enforcement of labor standards within their
respective territorial jurisdictions.
Jurisdiction:
1) Union registration related cases such as:
a) application for union registration or denial
thereof;
b) petitions for cancellation of union
registration
c) notice of merger, consolidation, affiliation,
and change of name of unions.
2) CBA registration or deregistration;
3) Complaints for examination of union books
and accounts;
4) Visitorial cases under Art 289 involving
examination of books of accounts of
independent unions, local chapters/chartered
locals and workers’ associations;
Note: Numbers 1-4 are appealable to the BLR
Director.
5) Visitorial cases under Article 37
6) Visitorial cases and enforcement cases under
Article 128;
7) Occupational safety and health violations;
8) Cases related to private recruitment and
placement agencies for local employment.
Note: Numbers 5-9 are appealable to the DOLE
Secretary.
9) Small monetary claims of P5,000 or less –
appealable to the NLRC.
BLR Directors
Original and exclusive jurisdiction:
1) Complaints and petitions involving the
application for registration, revocation or
cancellation of registration of federations,
national unions, industry unions, trade union
centers, and their local chapters/chartered
locals, affiliates and member organizations;
2) Request for examination of books of accounts
of said labor organizations;
3) Intra-union disputes involving said
organizations;
4) Notice of merger, consolidation, affiliation, and
change of name of said unions or petition for
denial thereof;
5) Registration of multi-employer CBAs;
6) Contempt cases.
Decisions decided by the BLR director in its original
and exclusive jurisdiction are appealable to the
DOLE Secretary.
On the other hand, the DOLE Secretary has no
jurisdiction over decisions of the BLR rendered in
the exercise of its appellate jurisdiction, the reason
being that such decisions and final and
inappealable.
 The only remedy therefor is a petition for
certiorari under Rule 65 to the CA, and
thereafter petition for review on certiorari under
Rule 45 to the SC.
F. NATIONAL CONCILIATION AND
MEDIATION BOARD
The NCMB is an agency attached to the DOLE
principally in-charge of the settlement of labor
disputes through conciliation, mediation and
voluntary arbitration.
 NCMB is not a quasi-judicial agency. Not being
a quasi-judicial agency, its decisions cannot be
elevated to the CA under Rule 43.
1. Jurisdiction
ART. 234. [228] Mandatory Conciliation and
Endorsement of Cases. - Except as provided in Title
VII-A, Book V of this Code, as amended, or as may be
excepted by the Secretary of Labor and Employment,
all issues arising from labor and employment shall be
subject to mandatory conciliation-mediation. The labor
arbiter or the appropriate DOLE agency or office that
has jurisdiction over the dispute shall entertain only
endorsed or referred cases by the duly authorized
officer.
(b) Any or both parties involved in the dispute may
pre-terminate the conciliation-mediation proceedings
and request referral or endorsement to the
appropriate DOLE agency or office which has
jurisdiction over the dispute, or if both parties so
agree, refer the unresolved issues to voluntary
arbitration.
ART. 239. [233] Privileged Communication.
Information and statements made at conciliation
proceedings shall be treated as privileged
communication and shall not be used as evidence in
the Commission. Conciliators and similar officials shall
not testify in any court or body regarding any matters
taken up at conciliation proceedings conducted by
them.
2. Conciliation distinguished from mediation
Both the terms conciliation and mediation refer to a
process whereby a neutral third person, usually
called the Conciliator-Mediator, intervenes in a
dispute involving two or more conflicting parties for
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the purpose of reconciling their differences or
persuading them into adjusting or settling their
dispute.
Conciliation – is conceived of as a mild form of
intervention by a neutral third party, the Conciliator-
Mediator, relying on his persuasive expertise, who
takes an active role in assisting parties by trying to
keep disputants talking, facilitating other procedural
niceties, carrying messages back and forth
between the parties, and generally being a good
fellow who tires to keep things calm and forward-
looking in a tense situation.
Mediation – is a mild intervention by a neutral third
party, the Conciliator-Mediator, whereby he starts
advising the parties or offering solutions or
alternatives to the problems with the end in view of
assisting them towards voluntarily reaching their
own mutually acceptable settlement of the dispute.
3. Preventive Mediation
Preventive Mediation Case — refers to the potential
labor dispute subject for conciliation and mediation
assistance sought by either or both parties or upon
the initiative of the NCMB to avoid the occurrence of
actual labor dispute.
Preventive mediation may be initiated in two ways:
a) By filing a notice or request of preventive
mediation, as distinguished from a notice of
strike/lockout; or
b) By conversion of the notice of strike/lockout into a
preventive mediation case.
As distinguished from a notice of strike/lockout, notice
of preventive mediation refers to the notification filed
by either an employer or a duly registered labor union
with the NCMB-DOLE informing the latter of its desire
to submit the issues between them for preventive
mediation and conciliation.
In particular, the following may file a request for
preventive mediation, notice of strike or lockout:
1. The president or any authorized representative of
a certified or duly recognized bargaining
representative in cases of bargaining deadlocks
and unfair labor practices.
2. In the absence of a certified or duly recognized
bargaining representative, the president or any
authorized representative of a legitimate labor
organization in the establishment on grounds of
unfair labor practice.
3. The employer or any authorized representative in
cases of bargaining deadlocks and unfair labor
practices.
The issues that may be submitted for preventive
mediation may either be strikeable or non-strikeable.
 In case of strikeable issues, the parties may
mutually agree that the same be treated or
 converted into a preventive mediation case, in
which event, no strike or lockout may be legally
and validly mounted based on the same issues
since their conversion into a preventive mediation
case has the effect of dismissing the notice of
strike/lockout and removing it from the docket of
notices of strike/lockout.
 In cases of non-strikeable issues raised in the
notice of strike/lockout, the NCMB, may motu
propio convert the same into a preventive
mediation case, or alternatively, refer said issues
to voluntary arbitration, if they are in the nature of
unresolved grievances or to the Med-Arbiter if
they involve representation or inter-union
disputes.
The NCMB has the authority to convert a notice of
strike/lockout filed by the union/employer into a
preventive mediation case under any of the following
circumstances:
a) When the issues raised in the notice of
strike/lockout are not strikeable in character;
b) When the party which filed the notice of
strike/lockout voluntarily asks for the conversion;
c) When both parties to a labor dispute mutually
agree to have it subjected to preventive
mediation proceeding.
G. DOLE REGIONAL DIRECTOR
(EXPANDED DISCUSSION)
“ARTICLE 128. Visitorial and Enforcement Power. —
(a) The Secretary of Labor and Employment or his
duly authorized representatives, including labor
regulation officers, shall have access to
employer's records and premises at any time of
the day or night whenever work is being
undertaken therein, and the right to copy
therefrom, to question any employee and
investigate any fact, condition or matter which
may be necessary to determine violations or
which may aid in the enforcement of this Code
and of any labor law, wage order or rules and
regulations issued pursuant thereto.
(b) Notwithstanding the provisions of Articles 129 and
217 of this Code to the contrary, and in cases
where the relationship of employer-employee still
exists, the Secretary of Labor and Employment or
his duly authorized representatives shall have the
power to issue compliance orders to give effect
to the labor standards provisions of this Code and
other labor legislation based on the findings of
labor employment and enforcement officers or
industrial safety engineers made in the course of
inspection. The Secretary or his duly authorized
representatives shall issue writs of execution to
the appropriate authority for the enforcement of
their orders, except in cases where the employer
contests the findings of the labor employment and
enforcement officer and raises issues supported
by documentary proofs which were not
considered in the course of inspection.
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An order issued by the duly authorized
representative of the Secretary of Labor and
Employment under this Article may be appealed
to the latter. In case said order involves a
monetary award, an appeal by the employer may
be perfected only upon the posting of a cash or
surety bond issued by a reputable bonding
company duly accredited by the Secretary of
Labor and Employment in the amount equivalent
to the monetary award in the order appealed from.
(c) The Secretary of Labor and Employment may
likewise order stoppage of work or suspension
of operations of any unit or department of an
establishment when non-compliance with the law
or implementing rules and regulations poses
grave and imminent danger to the health and
safety of workers in the workplace. Within twenty-
four hours, a hearing shall be conducted to
determine whether an order for the stoppage of
work or suspension of operations shall be lifted or
not. In case the violation is attributable to the fault
of the employer, he shall pay the employees
concerned their salaries or wages during the
period of such stoppage of work or suspension of
operation.
(d) It shall be unlawful for any person or entity to
obstruct, impede, delay or otherwise render
ineffective the orders of the Secretary of Labor
and Employment or his duly authorized
representatives issued pursuant to the authority
granted under this Article, and no inferior court or
entity shall issue temporary or permanent
injunction or restraining order or otherwise
assume jurisdiction over any case involving the
enforcement orders issued in accordance with this
Article.
(e) Any government employee found guilty of
violation of, or abuse of authority, under this
Article shall, after appropriate administrative
investigation, be subject to summary dismissal
from the service.
(f) The Secretary of Labor and Employment may, by
appropriate regulations, require employers to
keep and maintain such employment records as
may be necessary in aid of his visitorial and
enforcement powers under this Code.”
Article 128 enunciates 3 kinds of power which the
DOLE Secretary, the Regional Director as the
Secretary’s representative, and labor regulations
officers may exercise:
1) Visitorial power;
2) Enforcement power;
3) Appellate power or power of review (can only be
exercised by the DOLE Secretary)
Visitorial and Enforcement powers
For the valid exercise of the visitorial and enforcement
powers provided under Art 128, the following
requisites should concur:
1) The employer-employee relationship still exists at
the time of the initiation of the action;
 If at the time of the initiation of the action, the
ER-EE had already ceased to exist, it is not
the DOLE Regional Director but the Labor
Arbiter who has jurisdiction over the same;
 The DOLE Regional Director, in the exercise
of his visitorial and enforcement powers, has
the authority to make a determination on
whether such relationship exists.
2) The findings in question were made in the course
of inspection, regardless of whether it was
initiated by complaint or routine inspection; and
3) The employees have not yet initiated any claim or
complaint with the DOLE Regional Director (small
claims not exceeding P5,000) or the Labor Arbiter
under Art 224.
What is being inspected is the employer-
establishment and not the employees thereof.
Consequently, in case of a finding of violation of labor
standards, the awards granted in the inspection case
are not confined to employees who signed the
complaint inspection but are equally applicable to all
those who were employed by the establishment
concerned at the time the complaint was filed, even if
they were not signatories thereto.
Enforcement Power under Art 128 (b)
Pursuant, therefore, to the DOLE Regional Director’s
original jurisdiction, he may exercise the following:
1) To issue compliance orders to give effect to the
labor standards provisions of the Labor Code and
other labor legislations;
2) To issue writs of execution to the appropriate
authority for the enforcement of their orders,
except in contested cases, in which case the
contested case shall fall under the jurisdiction of
the Labor Arbiter to whom it should be endorsed
by the Regional Director;
3) To order stoppage of work or suspension of
operations of any unit or department of an
establishment when non-compliance with the law
or implementing rules and regulations poses
grave and imminent danger to the health and
safety or workers in the workplace;
4) To require employers to keep and maintain such
employment records as may be necessary in aid
of his visitorial and enforcement powers under
the Labor Code.
Contra: Art 37 and Art 289
ART. 37. Visitorial Power.
The Secretary of Labor or his duly authorized
representatives may, at any time, inspect the
premises, books of accounts and records of any
person or entity covered by this Title, require it to
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submit reports regularly on prescribed forms, and act
on violation of any provisions of this Title.
ART. 289. Visitorial Power.
The Secretary of Labor and Employment or his duly
authorized representative is hereby empowered to
inquire into financial activities of legitimate labor
organizations upon the filing of a complaint under oath
and duly supported by the written consent of at least
twenty percent (20%) of the total membership of the
labor organization concerned and to examine their
books of accounts and other records to determine
compliance or non-compliance with the law and to
prosecute any violations of the law and the union
constitution and bylaws: Provided, That such inquiry
or examination shall not be conducted during the sixty
(60) days freedom period nor within the thirty (30)
days immediately preceding the date of election of
union officials.
Visitorial Power Purpose
Art 128 To inquire into the
employer’s compliance
with labor standards
Art 37 Purpose is in relation to
recruitment and
placement of workers
for both local and
overseas employment
Art 289 To inquire into the
financial activities of
legitimate labor
organizations
NOTE: it is the Regional Directors, and not the DOLE
Secretary who have original jurisdiction to exercise
the visitorial and enforcement powers under Arts 37,
128, and 289. The role of the DOLE Secretary in the
exercise of visitorial and enforcement powers is
appellate in nature.
Small Money Claims Cases/Recovery and
Adjudication Power
ARTICLE 129. Recovery of Wages, Simple Money
Claims and Other Benefits. — Upon complaint of
any interested party, the Regional Director of the
Department of Labor and Employment or any of the
duly authorized hearing officers of the Department
is empowered, through summary proceeding and
after due notice, to hear and decide any matter
involving the recovery of wages and other
monetary claims and benefits, including legal
interest, owing to an employee or person employed
in domestic or household service or househelper
under this Code, arising from employer-employee
relations:
Provided, That such complaint does not include a
claim for reinstatement:
Provided, further, That the aggregate money claims
of each employee or househelper do not exceed
five thousand pesos (P5,000.00).
The Regional Director or hearing officer shall
decide or resolve the complaint within thirty (30)
calendar days from the date of the filing of the
same. Any sum thus recovered on behalf of any
employee or househelper pursuant to this Article
shall be held in a special deposit account, and shall
be paid, on order of the Secretary of Labor and
Employment or the Regional Director directly to the
employee or househelper concerned. Any such
sum not paid to the employee or househelper,
because he cannot be located after diligent and
reasonable effort to locate him within a period of
three (3) years, shall be held as a special fund of
the Department of Labor and Employment to be
used exclusively for the amelioration and benefit of
workers.
Any decision or resolution of the Regional Director
or hearing officer pursuant to this provision may be
appealed on the same grounds provided in Article
223 of this Code, within five (5) calendar days from
receipt of a copy of said decision or resolution, to
the National Labor Relations Commission which
shall resolve the appeal within ten (10) calendar
days from the submission of the last pleading
required or allowed under its rules.
The Secretary of Labor and Employment or his
duly authorized representative may supervise the
payment of unpaid wages and other monetary
claims and benefits, including legal interest, found
owing to any employee or house helper under this
Code.
Requisites for the valid exercise of jurisdiction
over small money claims:
1) The claim is presented by an employee;
2) The claimant, no longer being employed, does
not seek reinstatement;
 Thus, the employment relationship should
no longer exist at the time of the filing of
the complaint. Otherwise, the case falls
under the coverage of Art 128.
 Art 129 contemplates a case where the
employment relationship no longer exists,
and the terminated employee does not
raise the issue of the legality of his
dismissal but merely confines his
complaint to monetary claims which does
not exceed P5,000.
3) The aggregate money claim of the employee
does not exceed P5,000.
 Exception: Kasambahays
The P5k threshold does not apply to
Kasambahays. The DOLE Regional
Director has jurisdiction over all their
money claims, regardless of amount, in
light of the Batas Kasambahay.7
7
SEC. 37. Mechanism for Settlement of Disputes. – All
labor-related disputes shall be elevated to the DOLE
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Absence of any of the 3 requisites: LA has original
and exclusive jurisdiction.
Art 128 vs 129
While Art 128 refers to the visitorial and
enforcement power of the Secretary and the RD,
Art 129 refers to the adjudication power of the
Regional Directors or any duly authorized hearing
officers of the DOLE.
Art 128 deals with compliance with labor standards,
and therefore the existence of employer-employee
relationship is a condition sine qua non. On the
other hand, Art 129 confers upon the DOLE RDs
adjudicative power over small money claims of
employees arising from severed employer-
employee relations.
The distinction is important because if the decision
was rendered by the RD pursuant to its visitorial
and enforcement power under Art 128, which
means that the case stemmed from an inspection
complaint or routinary inspection, the appeal
therefor is to the DOLE Secretary. But if the
decision was rendered pursuant to Art 129, the
appeal should be made to the NLRC.
G. DOLE SECRETARY
1. Jurisdiction
Original and exclusive jurisdiction:
1) Petition to assume jurisdiction over labor disputes
affecting industries indispensable to national
interest;
2) Petition to certify national interest cases to the
NLRC for compulsory arbitration;
3) Petition to suspend effects of terminationl
4) Administrative Intervention for Dispute Avoidance
(AIDA) cases;
5) Voluntary arbitration cases; and
6) Contempt cases.
2. Visitorial and enforcement powers (discussed
above)
3. Power to suspend effects of termination
Regional Office having jurisdiction over the workplace
without prejudice to the filing of a civil or criminal action in
appropriate cases. The DOLE Regional Office shall exhaust
all conciliation and mediation efforts before a decision shall
be rendered. (SENA)
Ordinary crimes or offenses committed under the Revised
Penal Code and other special penal laws by either party
shall be filed with the regular courts.
NOTE: thus, all labor-related disputes involving
Kasamabahays, including illegal dismissal, money claims,
and other labor issues, is now lodged entirely with the DOLE
Regional Director, appealable, not to the NLRC, but to the
Secretary of Labor by express provision of the law.
Art. 292. (b) xxx “The Secretary of the Department of
Labor and Employment may suspend the effects of
the termination pending resolution of the dispute in
the event of a prima facie finding by the appropriate
official of the Department of Labor and Employment
before whom such dispute is pending that the
termination may cause a serious labor dispute or is in
implementation of a mass lay-off.”
Purpose: status quo anti litem
This way, the workers will be litigating the issue of the
validity or legality of their termination on more or less
equal footing with the employer since they will be
immediately reinstated and accordingly not be
deprived of their wages while litigation is on-going.
Suspension of the effects of termination will
necessarily result in the immediate reinstatement of
the terminated employees.
“appropriate officials” refers to the Labor Arbiters and
the Voluntary Arbitrators
 These are the officials who may make a
preliminary determination of the existence of
a prima facie finding by the appropriate
official of the DOLE before whom the
termination dispute is pending that it may
cause a serious labor dispute or is in
implementation of a mass lay-off
 Thereafter, such prima facie finding will
become the basis for the issuance by the
Secretary of his order suspending the effects
of termination.
4. Remedies
Against the decision of the Secretary, a petition for
certiorari under Rule 65 may be filed before the CA.
GRIEVANCE MACHINERY
ARTICLE 273. [260] Grievance Machinery and
Voluntary Arbitration. — The parties to a Collective
Bargaining Agreement shall include therein
provisions that will ensure the mutual observance
of its terms and conditions. They shall establish a
machinery for the adjustment and resolution of
grievances:
1) arising from the interpretation or
implementation of their Collective Bargaining
Agreement; and
2) those arising from the interpretation or
enforcement of company personnel policies.
All grievances submitted to the grievance
machinery which are not settled within seven (7)
calendar days from the date of its submission shall
automatically be referred to voluntary arbitration
prescribed in the Collective Bargaining Agreement.
For this purpose, parties to a Collective Bargaining
Agreement shall name and designate in advance a
Voluntary Arbitrator or panel of Voluntary
Arbitrators, or include in the agreement a
procedure for the selection of such Voluntary
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Arbitrator or panel of Voluntary Arbitrators,
preferably from the listing of qualified Voluntary
Arbitrators duly accredited by the Board.
In case the parties fail to select a Voluntary
Arbitrator or panel of Voluntary Arbitrators, the
Board shall designate the Voluntary Arbitrator or
panel of Voluntary Arbitrators, as may be
necessary, pursuant to the selection procedure
agreed upon in the Collective Bargaining
Agreement, which shall act with the same force and
effect as if the Arbitrator or panel of Arbitrators
have been selected by the parties as described
above.”
Grievance procedure/machinery: a “must”
provision
A CBA will not be registered with the DOLE if it
does not contain a provision on grievance
procedure/machinery.
The grievance procedure, being part and parcel of
the continuous collective bargaining process and
the union being their exclusive bargaining
representative, unions are generally recognized as
having the right to initiate, file or present a
grievance, either with regard to their rights as
unions under the contract, or with regard to the
rights of employees, whether collective or
individual.
Binding effect
A member of the SEBA who brought his grievable
issue for resolution by the grievance committee is
bound by whatever disposition the latter may
render thereon.
I. VOLUNTARY ARBITRATOR
Voluntary Arbitration – a mode of settling labor
management disputes by which the parties select a
competent, trained and impartial person who shall
decide on the merits of the case and whose
decision is final, executory and binding.
1. Jurisdiction
ARTICLE 274. [261] Jurisdiction of Voluntary
Arbitrators and Panel of Voluntary Arbitrators. —
The Voluntary Arbitrator or panel of Voluntary
Arbitrators shall have original and exclusive
jurisdiction to hear and decide all unresolved
grievances arising from the interpretation or
implementation of the Collective Bargaining
Agreement and those arising from the interpretation
or enforcement of company personnel policies
referred to in the immediately preceding article.
Accordingly, violations of a Collective Bargaining
Agreement, except those which are gross in
character, shall no longer be treated as unfair labor
practice and shall be resolved as grievances under
the Collective Bargaining Agreement. For purposes
of this article, gross violations of Collective
Bargaining Agreement shall mean flagrant and/or
malicious refusal to comply with the economic
provisions of such agreement.
The Commission, its Regional Offices and the
Regional Directors of the Department of Labor and
Employment shall not entertain disputes,
grievances or matters under the exclusive and
original jurisdiction of the Voluntary Arbitrator or
panel of Voluntary Arbitrators and shall immediately
dispose and refer the same to the Grievance
Machinery or Voluntary Arbitration provided in the
Collective Bargaining Agreement. (if filed before the
courts, courts should dismiss the case)
ARTICLE 275. [262] Jurisdiction over Other Labor
Disputes. — The Voluntary Arbitrator or panel of
Voluntary Arbitrators, upon agreement of the
parties, shall also hear and decide all other labor
disputes including unfair labor practices and
bargaining deadlocks.
Original exclusive jurisdiction of Voluntary
Arbitrators
1) unresolved grievances arising from the
interpretation or implementation of the CBA;
2) unresolved grievances arising from the
interpretation or enforcement of company
personnel policies;
“unresolved grievance”:
a) a decision or resolution was rendered
thereon through the various steps of the
grievance machinery and either or both
parties is/are not satisfied therewith; or
b) no action at all was taken thereon within
the period of 7 days from its submission
for resolution to the last step of the
grievance machinery (automatically
referred to voluntary arbitration)
Being mandated by law to hear and decide
grievances at the first instance, it is actually
the grievance machinery which exercises
original and exclusive jurisdiction over such
disputes, and the Voluntary Arbitrator is acting
in an appellate capacity.
3) violations of the CBA which are not gross in
character;
4) other labor disputes, including ULP and
bargaining deadlock, upon agreement of the
parties;
5) labor dispute causing or likely to cause a strike
or lockout in an industry indispensable to the
national interest, upon agreement of the
parties;
6) wage distortion issues arising from the
application of any wage orders in organized
establishments;
7) unresolved grievances arising from the
interpretation and application of the
Productivity Incentive Program under RA
6971.
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NOTE: the well-entrenched rule is that when a case does
not involve the parties to the CBA – the employer and the
SEBA – it is not subject to voluntary arbitration.
 While individual or group of employees, without the
participation of the SEBA, are granted the right to
bring grievance directly to the employer, they cannot
submit the same grievance, if unresolved by the
employer, for voluntary arbitration without the
SEBA’s approval and participation.
 The prominence of this rule is highlighted in
termination disputes where the SEBA is not named
a party to the illegal dismissal suit either because it
failed to object to the dismissal of the employee or
the suit was initiated by the employee alone with the
assistance of the SEBA. Thus, in a number of
cases, the Voluntary Arbitrator was held not to have
any jurisdiction thereover because the SEBA did not
come into the picture.
The VA shall exercise jurisdiction over a specific case
only upon receipt of the following:
1) Submission agreement duly signed by both parties;
2) Demand or notice to arbitrate when there is refusal
to arbitrate by one party;
3) Appointment or designation as Voluntary Arbitrator
by the NCMB in the following circumstances:
a) The parties failed to select a voluntary
arbitrator; or
b) The party upon whom the Notice to Arbitrate is
served does not favorably reply within 7 days
from receipt of such notice.
ARTICLE 276. [262-A] Procedures. — The Voluntary
Arbitrator or panel of Voluntary Arbitrators shall have
the power to hold hearings, receive evidences and
take whatever action is necessary to resolve the issue
or issues subject of the dispute, including efforts to
effect a voluntary settlement between parties.
All parties to the dispute shall be entitled to attend
the arbitration proceedings. The attendance of any
third party or the exclusion of any witness from the
proceedings shall be determined by the Voluntary
Arbitrator or panel of Voluntary Arbitrators. Hearing
may be adjourned for cause or upon agreement by
the parties.
Unless the parties agree otherwise, it shall be
mandatory for the Voluntary Arbitrator or panel of
Voluntary Arbitrators to render an award or decision
within twenty (20) calendar days from the date of
submission of the dispute to voluntary arbitration.
The award or decision of the Voluntary Arbitrator or
panel of Voluntary Arbitrators shall contain the facts
and the law on which it is based. It shall be final and
executory after ten (10) calendar days from receipt of
the copy of the award or decision by the parties.
Upon motion of any interested party, the Voluntary
Arbitrator or panel of Voluntary Arbitrators or the
Labor Arbiter in the region where the movant resides,
in case of the absence or incapacity of the Voluntary
Arbitrator or panel of Voluntary Arbitrators, for any
reason, may issue a writ of execution requiring either
the sheriff of the Commission or regular courts or any
public official whom the parties may designate in the
submission agreement to execute the final decision,
order or award.

ARTICLE 277. [262-B] Cost of Voluntary Arbitration

and Voluntary Arbitrator's Fee. — The parties to a
Collective Bargaining Agreement shall provide therein
a proportionate sharing scheme on the cost of
voluntary arbitration including the Voluntary
Arbitrator's fee. The fixing of fee of Voluntary
Arbitrators, or panel of Voluntary Arbitrators, whether
shouldered wholly by the parties or subsidized by the
Special Voluntary Arbitration Fund, shall take into
account the following factors:
(a) Nature of the case;
(b) Time consumed in hearing the case;
(c) Professional standing of the Voluntary Arbitrator;
(d) Capacity to pay of the parties; and
(e) Fees provided for in the Revised Rules of Court.

PRESCRIPTION OF ACTIONS

1) Money Claims
All money claims arising from employer –
employee relations accruing during the effectivity
of this Code shall be filed within 3 years from the
time the cause of action accrued; otherwise they
shall be forever barred.

2) Illegal Dismissal
An action for reinstatement prescribes in 4 years,
for the injury to the employee’s rights as provided
under Art. 1146 of the Civil Code.

3) Unfair Labor Practice

1 year from accrual of such unfair labor practice.

4) Offenses under the Labor Code

General Rule: 3 years from the time the cause of
action accrued

Exception: ULP cases prescribe within 1 year

from accrual of such unfair labor practice.

5) Illegal Recruitment
Simple illegal recruitment – 5 years
Economic sabotage – 20 years

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