PUP BAR REVIEW CENTER

LABOR LAW 1
LABOR LAW AND SOCIAL LEGISLATION
2023 NOTES

LABOR LAW 1
Fundamental Principles
and Concepts
Legal Basis
1987 Constitution
Art. XIII, Sec. 3. The State shall afford full
protection to labor, local and overseas,
organized and unorganized, and promote full
employment and equality of employment
opportunities for all.
It shall guarantee the rights of all workers to
self- organizations, and peaceful concerted
activities, including the right to strike in
accordance with law. They shall be entitled to
security of tenure, humane conditions of work,
and a living wage. They shall also participate in
policy and decision-making processes affecting
their rights and benefits as may be provided by
law.
The State shall promote the principle of shared
responsibility between workers and employers
and the preferential use of voluntary modes in
settling disputes, including conciliation, and
shall enforce their mutual compliance therewith
to foster industrial peace.
The State shall regulate the relations between
workers and employers, recognizing the right
of labor to its just share in the fruits of
production and the right of enterprises to
reasonable returns on investments, and to
expansion and growth.
Art. II, Sec. 18. The State affirms labor as a
primary social economic force. It shall protect
the rights of workers and promote their welfare.
Art. III, Sec. 8. The right of the people,
including those employed in the public and
private sectors, to form unions, associations, or
societies for purposes not contrary to law shall
not be abridged.
Basic Rights of Workers Guaranteed by the
Constitution
1. Security of tenure;
2. Living wage;
3. Share in the fruits of production;
4. Just and humane working conditions;
5. Self-organization;
6. Collective bargaining;
7. Collective negotiations;
8. Engage in peaceful concerted activities,
including the right to strike; and
9. Participate in policy and
decision-making processes. [Sec. 3,
Art. XIII, 1987 Constitution]
Rights of Management
It should not be supposed that every labor
dispute will be automatically decided in favor of
labor. Management also has its own rights
which Yare entitled to respect and enforcement
in the interest of simple fair play. (Sosito v.
Aguinaldo Development Corporation, G.R.
No. 48926)
Fundamental Management Rights
1. Right to Select employees;
2. Right to Prescribe rules;
3. Right to reasonable return on
Investments; and
4. Right to Transfer or discharge
employees.
Management has the right to regulate all
aspects of employment which include, among
others, work assignment, working methods,
and place and manner of work. (Marsman &
Co., Inc. v. Rodil Sta. Rita, G.R. No. 194765)
Restrictions to Management Rights
Management rights are never absolute. Under
the Constitution, the right to own and operate
economic enterprises is subject to the duty of
the State to promote distributive justice and to
intervene when the common good so
demands.
Management rights are subject to limitations
provided by:
1. Law;
2. Contract, whether individual or
collective; and
3. General principles of fair play and
justice.
Balancing of Rights between Labor and
Capital
It is high time that employer and employee
cease to view each other as adversaries and
instead recognize that theirs is a symbiotic
relationship, wherein they must rely on each
other to ensure the success of the business.
When they consider only their own
self-interests, and when they act only with their
own benefit in mind, both parties suffer from
short-sightedness, failing to realize that they
both have a stake in the business.
Arts. 3 and 4 of the Labor Code explicitly
recognize shared responsibility of the
employers and workers and the right of
enterprise to reasonable returns on investment
and to expansion and growth.
Civil Code
Art. 1700. The relations between capital and
labor are not merely contractual. They are so
impressed with public interest that labor
contracts must yield to the common good.
Therefore, such contracts are subject to the
special laws on labor unions, collective
bargaining, strikes and lockouts, closed shop,
wages, working conditions, hours of labor and
similar subjects.
Article 1701. Neither capital nor labor shall act
oppressively against the other, or impair the
interest or convenience of the public.
Art. 1702. In case of doubt, all labor legislation
and all labor contracts shall be construed in
favor of the safety and decent living for the
laborer. Article 1703. No contract which
practically amounts to involuntary servitude,
under any guise whatsoever, shall be valid.
Art. 19. Every person must, in the exercise of
his rights and in the performance of his duties,
act with justice, give everyone his due, and
observe honesty and good faith. This is known
as the Principle of Abuse of Rights.
Labor Code
Labor Code of the Philippines (Presidential
Decree (PD) No. 442) is a decree instituting a
Labor Code, thereby revising and consolidating
labor and social laws to afford protection to
labor, promote employment and human
resources development, and ensure industrial
peace based on social justice. It is a charter of
human rights and a bill of obligations for every
working man.
Date of Effectivity
P.D. 442 was signed into law on May 1, 1974. It
took effect on November 1, 1974, six (6)
months after its promulgation.
Declaration of Basic Policy
The State shall:
1. Afford full protection to labor;
2. Promote full employment;
3. Ensure equal work opportunities
regardless of sex, race, or creed;
4. Regulate the relations between workers
and employers; and
5. Assure the rights of workers to self-
organization, collective bargaining,
security of tenure, and just and humane
conditions of work. [Art. 3, Labor Code]
Rule-Making Power Granted by the Labor
Code
The Department of Labor and Employment
(DOLE) through the Secretary of Labor and
Employment (SOLE) and other Government
agencies charged with the administration and
enforcement of the Labor Code or any of its
parts shall promulgate the necessary IRRs.
[Art. 5, Labor Code]
Limitations to the Rule-Making Power
Granted by the Labor Code
1. It must be issued under the authority of
law;
2. It must not be contrary to law and the
Constitution; and
3. It must not go beyond the law itself.
An administrative interpretation which takes
away a benefit granted in the law is ultra vires,
that is, beyond one’s power. (CBTC
Employees Union v. Clave, G.R. No. 49582)
Applicability of Labor Code
GR: All rights and benefits granted to workers
under the LC shall apply alike to all workers,
whether agricultural or non-agricultural. [Art. 6,
Labor Code]
XPNs:
1. Government employees;
2. Employees of government-owned and
controlled corporations created by
special or original charter;
3. Foreign governments;
4. International agencies;
5. Corporate officers / intra-corporate
disputes which fall under PD 902-A and
now falls under the jurisdiction of the
regular courts pursuant to the Securities
Regulation Code;
6. Local water district except where the
NLRC’s jurisdiction is invoked; and
7. As may otherwise be provided by the
Labor Code.
Test to Determine the Applicability of the LC
to GOCC; Original Charter or Manner of
Creation Test
When a GOCC is created by a special charter,
it is subject to the provisions of the Civil
Service Law, while those incorporated under
the general Corporation Law are subject to the
provisions of the Labor Code. (PNOC-EDC v.
Legardo, G.R. No. 58494)
Labor Dispute between Government Ees
It is the Public Sector Labor-Management
Council, not the DOLE, which shall hear the
dispute. [Sec. 15, EO No. 180]
Extra-Territorial Application of LC
Whether employed locally or overseas, all
Filipino workers enjoy the protective mantle of
Philippine labor and social legislation, contract
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stipulations to the contrary notwithstanding.
This is in keeping with the basic public policy of
the State to afford protection to labor, promote
full employment, ensure equal work
opportunities regardless of sex, race or creed,
and regulate the relations between workers
and employers. For the State assures the basic
rights of all workers to self-organization,
collective bargaining, security of tenure, and
just and humane conditions of work. (PNB v.
Cabansag, G.R. No. 157010)
State Policy Towards Labor
Labor Code Declaration of Basic Policy
[Art. 3, Labor Code]
The State shall:
a. Afford protection to labor,
b. Promote full employment,
c. Ensure equal work opportunities
regardless of sex, race or creed, and
d. Regulate the relations between workers
and employers.
The State shall assure the rights of workers to:
a. Self-organization,
b. Collective bargaining,
c. Security of tenure, and
d. Just and humane conditions of work.
Security of Tenure
Purpose: to safeguard the general welfare of
the public.
Example: Persons who desire to engage in the
learned professions may be required to take an
examination as a prerequisite to engaging in
the same.
Sec. 3. The State shall afford full protection to
labor, local and overseas, organized and
unorganized, and promote full employment and
equality of employment opportunities for all.
It shall guarantee the rights of all workers to
self organization, collective bargaining and
negotiations, and peaceful concerted activities,
including the right to strike in accordance with
law. They shall be entitled to security of tenure,
humane conditions of work, and a living wage.
They shall also participate in policy and
decision making processes affecting their rights
and benefits as may be provided by law. [Art.
3, 1987 Philippine Constitution]
Social Justice
Sec. 9, Art. II, 1987 Constitution: The State
shall promote a just and dynamic social order
that will:
a) Ensure the prosperity and independence of
the nation;
b) Free the people from poverty through
policies that provide adequate social
services; and
c) Promote:
i) Full employment,
ii) A rising standard of living
iii) Improved quality of life for all
Sec. 10, Art. II, 1987 Constitution: The State
shall promote social justice in all phases of
national development.
Social Justice
Social justice is neither communism, nor
despotism, nor atomism, nor anarchy, but the
humanization of laws and the equalization of
social and economic forces by the State so that
justice in its rational and objectively secular
conception may at least be approximated.
(Calalang v. Williams, G.R. No. 47800)
Welfare state based on social justice
The welfare state concept is found in the
constitutional clause on the promotion of social
justice to ensure the well-being and economic
security of all the people, and in the pledge of
protection to labor with specific authority to
regulate the relations between landowners and
tenants and between labor and capital.
(Alalayan v. National Power Corp., G.R. No.
L-24396)
Limitations of Social Justice
Social justice should be used only to correct an
injustice. It must be founded on the recognition
of the necessity of interdependence among
diverse units of a society, and of the protection
that should be equally and evenly extended to
all groups as a combined force in our social
and economic life. (Agabon v. NLRC, G.R.
No. 158693)
Equal Work Opportunities
Declaration of Basic Policy [Art. 4, Labor
Code]
The State shall:
a) Afford protection to labor,
b) Promote full employment,
c) Ensure equal work opportunities
regardless of:
i) Sex,
ii) Race, or
iii) Creed,
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 d) Regulate the relations between workers
and employers.
The State shall assure the rights of workers to:
a) Self-organization,
b) Collective bargaining,
c) Security of tenure, and
d) Just and humane conditions of work.
Sec. 3, par. 1, Art. XIII, 1987 Constitution.
The State shall:
a) Afford protection to labor,
i) Local and overseas,
ii) Organized and unorganized, and
b) Promote full employment and equality of
employment opportunities for all.
Sec. 2, R.A. No. 10911. Declaration of
Policies
The State shall promote equal opportunities in
employment for everyone. To this end, it shall
be the policy of the State to:
a) Promote employment of individuals on
the basis of their –
b) Prohibit arbitrary age limitations in
employment.
i) Abilities,
ii) Knowledge,
iii) Skills, and
iv) Qualifications, rather than their age
c) Promote the right of all employees and
workers, regardless of age, to be treated
equally in terms of –
i) Compensation,
ii) Benefits,
iii) Promotion,
iv) Training, and
v) Other employment opportunities.
Right to Self-Organization and Collective
Bargaining
1987 Constitution
The State shall guarantee:
a) The right of the people, including those
employed in the public and private
sectors, to form unions, associations, or
societies for purposes not contrary to
law. [Sec. 8, Art. III.]
b) The rights of all workers to –
i) Self-organization [Sec. 3, Art. XIII]
ii) Collective bargaining and
negotiations [Sec. 3, Art. XIII]
iii) Peaceful concerted activities [Sec.
3,Art. XIII]
iv) Strike in accordance with law. [Sec.
3, Art. XIII]
Art. 253, Labor Code
All persons employed:
a) In commercial, industrial and agricultural
enterprises, and
b) In religious, charitable, medical or
educational institutions, whether
operating for profit or not, shall have the
right to
i) Self-organization,
ii) Form, join, or assist labor
organization of their own choosing for
purposes of collective bargaining.
Ambulant, intermittent and itinerant workers,
self-employed people, rural workers and those
without any definite employers may form labor
organizations for their mutual aid and
protection.
Art. 254, Labor Code
Employees of government corporations
established under the corporation code shall
have the right to:
a) Organize, and
b) Bargain collectively with their respective
employers.
All other employees in the civil service shall
have the right to form associations for
purposes not contrary to law.
Infringement of the right to
self-organization
It shall be unlawful for any person to restrain,
coerce, discriminate against or unduly interfere
with employees and workers in their exercise
of the right to self-organization [Art. 257,
Labor Code]
Scope of right to self-organization
1. Right to form, join or assist labor
organizations of their own choosing for the
purpose of collective bargaining through
representatives of their own choosing.
2. Right to engage in lawful concerted
activities for the same purpose (collective
bargaining) or for their mutual aid and
protection
3. The right of any person to join an
organization also includes the right to
leave that organization and join another
one. (Heritage Hotel Manila v.
PIGLASHeritage, G.R. No. 177024)
4. The right to form or join a labor
organization necessarily includes the right
to refuse or refrain from exercising said
right. It is self-evident that just as no one
should be denied the exercise of a right
granted by law, so also, no one should be
compelled to exercise such a conferred
right. (Reyes v. Trajano, G.R. No. 84433)
5. The right of the employees to
self-organization is a compelling reason
why their withdrawal from the cooperative
must be allowed. As pointed out by the
union, the resignation of the member
employee is an expression of their
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 preference for union membership over that
of membership in the cooperative. (Central
Negros Electric Cooperative v. SOLE,
G.R. No. 94045)
Their freedom to form organizations would be
rendered nugatory if they could not choose
their own leaders to speak on their behalf and
to bargain for them. [Pan- American World
Airways, Inc v. Pan-American Employees
Association, G.R. No. L-25094]
Construction in Favor of Labor
All doubts in the implementation and
interpretation of the provisions of this Code,
including its implementing rules and
regulations, shall be resolved in favor of labor.
[Art. 4, Labor Code]
It is construed in favor of labor if there is a
doubt as to the meaning of the legal and
contractual provision. If the provision is clear
and unambiguous, it must be applied in
accordance with its express terms.
(MERALCO v. NLRC, G.R. No. 78763)
The law also recognizes that management has
rights, which are also entitled to respect and
enforcement in the interest of fair play. (St.
Luke’s v. NLRC, G.R. No. 162053)
While labor laws should be construed liberally
in favor of labor, we must be able to balance
this with the equally important right of the
[employer] to due process. (Gagui v. Dejero,
G.R. No. 196036)
If doubts exist between the evidence presented
by the employer and the employee, the scale
of justice must be tilted in favor of the latter.
(Dreamland Hotel Resort v. Johnson, G.R.
No. 191455).
Mutual obligation
The employer's obligation to give his workers
just compensation and treatment carries with it
the corollary right to expect from the workers
adequate work, diligence and good conduct.
(Judy Philippines, Inc. v NLRC, G.R. No.
111934, dated April 29, 1998)
Burden of Proof and Quantum of Evidence
Summary on Burden of Proof
1. Existence of ER-EE Relationship:
Employee
2. Fact of dismissal: Employee
3. Validity of Dismissal: Employer
EE has burden of proving fact of
employment and of dismissal
Before a case for illegal dismissal can prosper,
an employer-employee relationship must first
be established by the employee. (Javier v. Fly
Ace Corp., G.R. No. 192558)
ER has burden of proving valid dismissal
Unsubstantiated accusations or baseless
conclusions of the employer are insufficient
legal justifications to dismiss an employee. The
unflinching rule in illegal dismissal cases is that
the employer bears the burden of proof.
(Garza v. Coca-Cola Bottlers Philippines,
Inc., G.R. No. 180972)
Penalty must be commensurate with gravity
of offense
Not every case of insubordination or willful
disobedience by an employee reasonably
deserves the penalty of dismissal. The penalty
to be imposed on an erring employee must be
commensurate with the gravity of his offense.
(Joel Montallana v. La Consolacion College
Manila, G.R. No. 208890)
Pre-Employment
Recruitment and Placement of Local
and Migrant Workers
Governing Laws
a) Labor Code; and
b) Migrant Workers and Overseas Filipinos
Act of 1995. [R.A. No. 8042, as
amended by R.A. No. 10022]
Definition of Recruitment and Placement
Recruitment and Placement
a) Any act of Canvassing, Enlisting,
Transporting, Contracting, Hiring,
Utilizing, or Procuring workers; and
b) Includes Contract services, Referrals,
Advertising or Promising for
employment, locally or abroad, whether
for profit or not. [Art. 13(b), Labor
Code]
Worker - refers to any member of the labor
force, whether employed or unemployed. [Art.
13(a), Labor Code]
Overseas Filipino - Dependents of migrant
workers and other Filipino nationals abroad
who are in distress as mentioned in Sections
24 and 26 of the Migrant Workers Act. [Sec.
3[c], R.A. No. 8042]
Overseas Filipino Worker - is a person who is
to be engaged, is engaged or has been
engaged in a remunerated activity in a state of
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which he or she is not a citizen or on board a 5. Hiring
vessel navigating the foreign seas other than a 6. Utilizing, or
government ship used for military or 7. Procuring workers
noncommercial purposes or on an installation - Contract of services
located offshore or on the high seas; to be - Referrals
used interchangeably with migrant worker. - Advertising for employment
[Sec. 2[a], R.A. No. 8042] - Promising for employment locally or
abroad, whether for profit or not.
Overseas Filipino [Art. 13, Labor Code]

Private Employment Agency - means any Acts of referral

person or entity engaged in recruitment and The act of referral, which is included in
placement of workers for a fee which is recruitment, is the act of passing along or
charged, directly or indirectly, from the workers forwarding of an applicant for employment after
or employers or both. [Art. 13(c), Labor Code] an initial interview of a selected applicant for
employment to a selected employer, placement
Private Recruitment Entity - means any officer or bureau. (Rodolfo vs. People, G.R.
person or association engaged in the No. 146964)
recruitment and placement of workers, locally
or overseas, without charging, directly or Promising employment
indirectly, any fee from the workers or Promising employment as factory workers and
employees. [Art. 13(e), Labor Code] receiving money allegedly for processing
papers without authorization or license is
License v. Authority engaging in unlawful recruitment and
License Authority placement activities. The absence of the
A document issued A document issued necessary license or authority renders all of
by the DOLE by the DOLE accused-appellant􀂶s recruitment activities
authorizing a authorizing a criminal. (People vs. Saulo, G.R. No. 125903)
person/entity to person/association to
operate a private engage in recruitment Perfection of employment contract gives
fee-charging and placement rise to Illegal recruitment
employment agency activities as a private The commencement of the employment
recruitment entity relationship must be treated separately from
the perfection of an employment contract.
Private Employment Agency v. Private
Recruitment Entity The perfection of the contract, which (as a
Private Private Recruitment general rule) coincides with the date of
Employment Entity execution, occurred when the parties agreed
Agency on the object and the cause, and the terms and
Private Employment Private Recruitment conditions. Despite the non-deployment (which
Agency means any Entity means any caused the non-commencement of the
person/ entity person/association employment relationship), rights have arisen
engaged in the engaged in the based on the perfected contract. (C.F. Sharp v.
recruitment and recruitment and Pioneer Insurance, G.R. No. 179469)
placement of placement of
workers for a fee workers, locally or REGULATORY AUTHORITIES POEA
which is charged, overseas, without
directly or indirectly, charging, directly or Jurisdiction of the POEA
from the indirectly, any fee Original and exclusive jurisdiction to hear and
workers, from the workers or decide:
employers. a) All cases, which are administrative in
Requires a license. Requires an authority. character, involving or arising out of
[Art. 13, Labor Code] violations of rules and regulations
relating to licensing and registration of
Regulations of Recruitment and Placement recruitment and employment agencies
Activities or entities
b) Disciplinary action cases and other
Recruitment and Placement is any act of: special cases, which are administrative
1. Canvassing in character, involving employers,
2. Enlisting principals, contracting partners and
3. Transporting Filipino migrant workers [IRR of R.A.
4. Contracting no. 8042, Rule X, Sec. 6]

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Outside of POEA Jurisdiction
a) Foreign Judgment 􀂱 POEA has no
jurisdiction to hear and decide a claim
for enforcement of a foreign judgment
(Pacific Asia Overseas v. NLRC, G.R.
No. 76595)
b) Torts 􀂱 Fall under the provisions of the
Civil Code (Mckenzie v. Cui, G.R. No.
48831)
Regulatory and Visitorial Powers of the
DOLE Secretary
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. [Art. 36,
Labor Code]
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. [Art. 37, Labor Code]
a) Regulatory Authorities
Bureau of Employment Services.
Powers and Duties
1. The Bureau of Employment Services
shall be primarily responsible for
developing and monitoring a be deposited in the National Treasury as
comprehensive employment program. It
shall have the power and duty:
a. To formulate and develop plans and
programs to implement the
employment promotion objectives.
b. To establish and maintain a
registration and/or licensing system
to regulate private sector
participation in the recruitment and
placement of workers, locally and
overseas, and to secure the best
possible terms and conditions of
employment for Filipino contract
workers and compliance therewith
under such rules and regulations as
may be issued by the Minister of
Labor.
c. To formulate and develop
employment programs designed to
benefit disadvantaged groups and
communities.
d. To establish and maintain a
registration and/or work permit
system to regulate the employment
of aliens.
e. To develop a labor market
information system in aid of proper
manpower and development
planning.
f. To develop a responsive vocational
guidance and testing system in aid of
proper human resources allocation
g. To maintain a central registry of
skills, except seamen.
Regional offices of the Ministry of Labor
1. Shall have the original and exclusive
jurisdiction over all matters or cases
involving employer-employee relations
including money claims, arising out of or
by virtue of any law or contracts
involving Filipino workers for overseas
employment except seamen: Provided,
That the Bureau of Employment
Services may, in the case of the
National Capital Region, exercise such
power, whenever the Minister of Labor
deems it appropriate. The decisions of
the regional offices of the Bureau of
Employment Services, if so authorized
by the Minister of Labor as provided in
this Article, shall be appealable to the
National Labor Relations Commission
upon the same grounds provided in
Article 223 hereof. The decisions of the
National Labor Relations Commission
shall be final and unappealable.
2. Shall have the power to impose and
collect fees based on rates
recommended by the Bureau of
Employment Services. Such fees shall
a special account of the General Fund,
for the promotion of the objectives of the
Bureau of Employment Services,
subject to the provisions of Section 40 of
Presidential Decree No. 1177.
(1) Philippine Overseas Employment
Administration
Jurisdiction of the POEA
The POEA shall exercise original and exclusive
jurisdiction over:
1. All administrative pre-employment/
recruitment violation cases; and
2. Administrative disciplinary action cases
involving employers, principals,
contracting partners and OFWs
processed by the POEA.
Petitioners’ adamant insistence that the NLRC
should have appellate authority over the
6
POEA’s decision in the disciplinary action
because their complaint against respondents
was filed in 1993 was unwarranted. Although
R.A. No. 8042, through its Sec. 10, transferred
the original and exclusive jurisdiction to hear
and decide money claims involving overseas
Filipino workers from the POEA to the LAs, the
law did not remove from the POEA the original
and exclusive jurisdiction to hear and decide all
disciplinary action cases and other special
cases administrative in character involving
such workers. (Eastern Mediterranean
Maritime Ltd. v. Surio, G.R. 154213)
The obvious intent of Republic Act No. 8042
was to have the POEA focus its efforts in
resolving all administrative matters affecting
and involving such workers. This intent was
even expressly recognized in the Omnibus
Rules and Regulations Implementing the
Migrant Workers and Overseas Filipinos Act of
1995 promulgated on February 29, 1996.
(2) Regulatory and Visitorial Powers of the
Department of Labor and Employment
Secretary
The DOLE issued D.O. No. 57-04, also called
the Labor Standards Enforcement Framework
(LSEF).
The framework comprises three approaches:
1. Self-assessment;
2. Inspection; and
3. Advisory service.
Jurisdiction
SOLE has jurisdiction over the following cases:
1. Assumption of jurisdiction over cases
where labor disputes are likely to cause
a strike or lockout in an industry
indispensable to national interest (D.O.
40-G03, S 2010)
2. Visitorial powers to over employers (Art.
128, LC)
3. Issue a writ of execution on a judgment
(Art. 224, LC)
4. 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. (Art. 277 (b), LC)
Visitorial power
It constitutes:
1. Access to Er’s records and premises at
any time of the day or night, whenever
work is being undertaken;
2. Right to copy from said records; and
3. Right to question Ee and investigate any
fact, condition or matter which may be
necessary to determine violations, or
which may aid in the enforcement of the
LC and of any wage order, or rules and
regulation issued pursuant thereto.
Instances where the visitorial power of the
SOLE may be exercised under the LC
Power to:
1. Inspect books of accounts and records
of any person or entity engaged in
recruitment and placement, require it to
submit reports regularly on prescribed
forms and act in violations of any
provisions of the LC on recruitment and
placement. [Art. 37, LC]
2. Have access to Er’s records and
premises to determine violations of any
provisions of the LC on recruitment and
placement. [Art. 128, LC]
3. Conduct industrial safety inspections of
establishments. [Art. 165, LC]
4. Inquire into the financial activities of LLO
and examine their books of accounts
upon the filing of the complaint under
oath and duly supported by the written
consent of at least 20% of the total
membership of the LO concerned.
Enforcement power
Power to:
1. Issue compliance orders;
2. Issue writs of execution for the
enforcement of their orders, except in
cases where the Er contests the findings
of the labor officer and raise issues
supported by documentary proof which
were not considered in the course of
inspection;
3. Order stoppage of work or suspension
of operation when non-compliance with
the law or implementing rules and
regulations poses grave and imminent
danger to health and safety of workers
in the workplace;
4. Require Ers to keep and maintain such
employment records as may be
necessary in aid to the visitorial and
enforcement powers; and
5. Conduct hearings within 24 hours to
determine whether:
a. An order for stoppage of work or
suspension of operations shall be
lifted or not; and
b. Er shall pay the concerned Ees
their salaries in case the violation
is attributable to his fault. (As
amended by RA 7730; Guico v.
Secretary, G.R. No. 131750, 16
Nov. 1998)
7
Instances when Enforcement Power may
not be used
1. Case does not arise from the exercise of
visitorial power;
2. When Er-Ee relationship ceased to exist
at the time of the inspection; and
3. If Er contests the finding of the Labor
Regulation Officer and such contestable
issue is not verifiable in the normal
course of inspection.
Direct Hiring
It occurs when an employer hires a Filipino
worker for overseas employment without going
through the POEA or entities authorized by the
SOLE.
b) Ban on Direct Hiring
GR: An employer may only hire Filipino
workers for overseas employment through
POEA or entities authorized by DOLE. [Art. 18,
LC]
XPNs: Direct hiring by:
1. International organizations (e.g., World
Bank)
2. Name Hires – individual workers who
were able to secure contracts for
overseas employment on their own
efforts and representations without the
assistance or participation of any
agency. Their hiring, nonetheless, must
be processed through the POEA.
3. Members of the diplomatic organizations
(e.g., those employed by an embassy)
4. Other Employers as may be allowed by
DOLE such as workers hired by a
relative/family member who is a
permanent resident of the host country.
Purposes of the Prohibition on Direct Hiring
1. To ensure the best possible terms and
conditions of employment for the
worker;
2. To assure the foreign employer that he
hires only qualified Filipino workers; and
3. To ensure full regulation of employment
to avoid exploitation.
c) Entities Prohibited from Recruiting
Persons and Entities Disqualified to Engage
in the Business of Recruitment and
Placement of Workers
1. Travel agencies and sales agencies of
airline companies; (Art. 26, LC)
2. Officers or members of the board of any
corporation or members in a partnership
engaged in the business of a travel
agency;
3. Corporations and partnerships, when
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. Persons, partnerships or corporations
which have derogatory records, such as
but not limited to those:
a. Certified to have derogatory
record or information by the NBI
or by the Anti- Illegal Recruitment
Branch of the POEA;
b. Against whom probable cause or
prima facie finding of guilt for
illegal recruitment or other related
cases exists;
c. Convicted for illegal recruitment
or other related cases and/or
crimes involving moral turpitude;
and
d. Agencies whose licenses have
been previously revoked or
cancelled by the POEA for
violation of R.A. No. 8042, as
amended by R.A. No. 10022, P.D.
442 as amended, and their IRRs.
5. Any official or employee of the DOLE,
POEA, OWWA, DFA, and other
government agencies directly involved
in the implementation of R.A. No. 8042,
as amended by R.A. No. 10022 and/or
any of his/her relatives within the 4th
civil degree of consanguinity or affinity;
and
6. Persons or partners, officers, and
directors of corporations whose licenses
have been previously cancelled or
revoked for violation of recruitment laws.
[Sec. 2, Rule I, 2002 Rules and
Regulations on the Recruitment and
Employment of Land-Based Workers]
Prohibition on Travel Agencies and Sales
Agencies of Airline Companies to Recruit
They are prohibited from engaging in the
business of recruitment and placement of
workers for overseas employment, whether for
profit or not, due to conflict of interest.
Purpose for Prohibiting Travel Agencies
This is because travel agencies are under the
supervisory powers of the Department of
Tourism, not the DOLE.
Otherwise, confusion may arise to the
detriment and disadvantage of an overseas
applicant-worker or may lead to exploitation of
the applicant-worker who will be at the
economic mercy of the travel agency or sales
agencies of airline company from the time his
papers are processed to the time he departs.
8
It cannot be discounted that travel agencies
can facilitate with the airlines the issuance of
the worker's plane ticket. Moreover, illegal
recruitment activities can be traced to travel
agencies that facilitate papers of job-seekers
for overseas. They could do a dirty job of
legalizing the travel on tourist-visas with the
assurance that the same could be converted
into work-visas in the country of employment.
d) Suspension or Cancellation of License or
Authority
Two Kinds of Illegal Recruiter
1. May be a licensee – performs any of the
prohibited practices enumerated under
Sec. 6 of R.A. 8042, as amended by
R.A. No. 10022.
2. May be a non-licensee – any person,
corporation, or entity:
a. Which has not been issued a
valid license or authority to
engage in recruitment and
placement by the SOLE; or
b. Whose license or authority has
been suspended, revoked, or
cancelled by the POEA or the
SOLE.
Jurisdiction
The SOLE and the POEA Administrator are
vested with power to suspend or cancel any
license or authority to recruit employees for
overseas employment. (Art. 35, LC)
The SOLE has the power under Art. 35 of the
LC to apply the penalties of suspension and
cancellation of license and authority. The SOLE
also has the authority, under Art. 36 of the LC,
not only to restrict and regulate the recruitment
and placement activities of all agencies, but
also to promulgate rules and regulations to
carry out the objectives and implement the
provisions governing said activities.
Pursuant to this rule-making power, the SOLE
authorized the POEA to conduct the necessary
proceedings for the suspension or cancellation
of license or authority of any agency or entity
for certain enumerated offenses. (Trans
Action Overseas Corporation v. Secretary
of Labor, G.R. No. 109583)
Thus, the Court concludes that the power to
suspend or cancel any license or authority to
recruit employees for overseas employment is
concurrently vested with the POEA and the
SOLE.
Grounds for Revocation of License
1. Incurring an accumulated three (3)
counts of suspension by an agency
based on final and executory orders
within the period of validity of its license;
2. Violations of the conditions of license;
3. Engaging in acts of misrepresentation
for the purpose of securing a license or
renewal; and
4. Engaging in the recruitment or
placement of workers to jobs harmful to
the public health or morality or to the
dignity of the country. (Sec. 3, Rule I,
Book VI, Rules and Regulations
Governing Overseas Employment)
Grounds for Suspension or Cancellation of
License
1. Commission of prohibited acts under
Art. 34 of LC;
2. Publishing job announcements without
POEA’s approval;
3. Charging a fee which may be in excess
of the authorized amount before a
worker is employed;
4. Deploying workers without processing
through POEA; and
5. Recruitment in places outside its
authorized area. (Sec. 4, Rule II, Book
IV, POEA Rules)
e) Prohibited Practices [Article 34, Labor
Code]
It shall be unlawful for any individual, entity,
licensee, or holder of authority:
1. 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, or to make a worker pay any
amount greater than that actually
received by him as a loan or advance;
2. To furnish or publish any false notice or
information or document in relation to
recruitment or employment;
3. 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
this Code.
4. To induce or attempt to induce a worker
already employed to quit his
employment in order to offer him to
another unless the transfer is designed
to liberate the worker from oppressive
terms and conditions of employment;
5. To influence or to attempt to influence
any person or entity not to employ any
worker who has not applied for
employment through his agency;
6. 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;
9
 7. To obstruct or attempt to obstruct
inspection by the Secretary of Labor or
by his duly authorized representatives;
8. To fail to file 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.
9. To substitute or alter employment
contracts approved and verified by the
Department of Labor from the time of
actual signing thereof by the parties up
to and including the periods of expiration
of the same without the approval of the
Secretary of Labor;
10. To become an officer or member of the
Board of any corporation engaged in
travel agency or to be engaged directly
or indirectly in the management of a
travel agency; and
11. To withhold or deny travel documents
from applicant workers before departure
for monetary or financial considerations
other than those authorized under this
Code and its implementing rules and
regulations.
3. Illegal Recruitment [Labor Code and the
Migrant Workers and Overseas Employment
Act of 1995 (RA 8042), as amended by RA
10022]
Illegal Recruitment
Any act of canvassing, enlisting, contracting,
transporting, utilizing, hiring, or procuring
workers and includes referring, contract
services, promising or advertising for
employment abroad, whether for profit or not,
when undertaken by non-licensee or
non-holder of authority. (Sec. 6, R.A. No. 8042,
as amended by R.A. No. 10022)
Any recruitment activities, including the
prohibited practices enumerated under Art. 34
of the Labor Code, to be undertaken by
non-licensed or non-holders of authority, shall
be deemed illegal and punishable. (Art. 38(a),
LC)
Illegal Recruitment as Economic Sabotage
Illegal recruitment, when committed by a
syndicate or in large scale, shall be considered
an offense involving economic sabotage. (Art.
38(b), LC)
It is deemed to be committed by a syndicate if
carried out by a group of three (3) or more
persons conspiring and/or confederating with
one another in carrying out any unlawful or
illegal transaction, enterprise or scheme.
It is deemed committed in large scale if
committed against three (3) or more persons
individually or as a group.
Prohibited Acts in Recruitment and
Placement
1. Overcharging – To charge or accept,
directly or indirectly, any amount greater
than that specified in the schedule of
allowable fees prescribed by the SOLE,
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 LC, 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 Er whether
registered or not with the POEA.
4. Inducing Worker to Quit – To induce or
attempt to induce a worker already
employed to quit his employment in
order to offer him to another, unless the
transfer is designed to liberate the
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. Failure to submit 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
SOLE.
8. Contract Substitution – To substitute
or alter to the prejudice of the worker,
employment contracts prescribed by the
10
 Department 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
DOLE.
9. Involvement in Travel 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 a travel
agency or insurance agency.
10. 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 LC and its IRR.
11. Failure to Deploy – To fail to actually
deploy a contracted worker without valid
reason as determined by the DOLE.
12. Failure to Reimburse – To fail to
reimburse expenses incurred by the
worker in connection with his/her
documentation and processing for
purposes of deployment, in cases where
the deployment does not actually take
place without the worker’s fault.
13. Non-Filipino Manager – To allow a
non- Filipino citizen to head or manage
a recruitment agency;
14. Imposition of Excessive Interest – To
grant a loan to an OFW with interest
exceeding 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.
15. Specifying a Loan Entity – To impose
a compulsory and exclusive
arrangement whereby an OFW is
required to avail of a loan only from
specifically designated institutions,
entities, or persons.
16. Non-Renegotiation of Loan – To
refuse to condone or renegotiate a loan
incurred by an OFW after his
employment contract has been
prematurely terminated through no fault
of his or her own;
17. Specifying a Medical Entity – To
impose a compulsory and exclusive
arrangement whereby an OFW is
required to undergo health examinations
only from specifically designated
medical clinics, institutions, entities or
persons, except in the case of a worker
whose medical examination cost is
shouldered by the principal;
18. Specifying a Training Entity – To
impose a compulsory and exclusive
arrangement whereby an OFW is
required to undergo training, seminar,
instruction or schooling of any kind only
from specifically designated institutions,
entities or persons, except for
recommendatory trainings mandated by
principals where the latter shoulder the
cost of such trainings;
19. 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
20. Collection of Insurance Premium –
For a recruitment/manning agency or a
foreign principal/ Er to pass on the OFW
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. (Sec. 6, R.A. No. 8042, as
amended by R.A. No. 10022)
a) Elements
1. The offender undertakes any of the
activities within the meaning of
“recruitment and placement” under Art.
13(b) of the LC, or any of the prohibited
practices enumerated under Art. 34 of
the LC; and
2. The offender has no valid license or
authority required by law to enable him
to lawfully engage in recruitment and
placement of workers. (People v Chua,
G.R. No. 187052, 13 Sept. 2012)
3. If committed by a syndicate - carried
out by a group of three or more persons
conspiring and/or confederating with
one another; or
4. If committed by large scale - if
committed against three or more
persons individually or as a group.
b) Types
1. Simple – It is committed where a
licensee/non-licensee or holder/
non-holder of authority undertakes
either any recruitment activities defined
under Art. 13(b), or any prohibited
practices enumerated under Sec. 6 of
R.A. No. 8042, as amended by R.A. No.
10022.
Prescription of action: Five (5) years.
(Sec. 12, R.A. No. 8042, as amended
by R.A. No. 10022)
11
 Where the illegal recruitment is proved,
but the elements of large scale and
syndicate are absent, the accused can
be only convicted of simple illegal
recruitment. (People v. Sagun, G.R.
No. 119076, 25 Mar. 2002)
2. Illegal Recruitment as Economic
Sabotage – It is economic sabotage
when complex illegal recruitment is
committed.
a. Syndicated – committed by a
syndicate if carried out by a group of
three (3) or more persons in
conspiracy or confederation with one
another;
b. Large Scale or qualified –
committed against three (3) or more
persons individually or as a group
despite the lack of necessary license
from POEA. (People v. Alzona, G.R.
No. 132029, 30 July 2004)
Prescription of action: 20 years. (Sec. 12,
R.A. No. 8042, as amended by R.A. No.
10022)
NOTE: “Illegal recruitment in large scale”
pertains to the number of victims, while
“syndicated illegal recruitment” pertains to the
number of recruiters.
c) Illegal Recruitment vs. Estafa
4. Liability of Local Recruitment Agency
and Foreign Employer
Liability of the Local Recruitment Agency
GR: A Local Recruitment Agency shall be
jointly and solidarily liable with its principal or
foreign-based Er for any violation of the
recruitment agreement and violation of
contracts of employment. (Sec. 10(a)(2), Rule
V, Book I, IRR)
In applying for a license to operate a private
employment agency for overseas recruitment
and placement, an applicant is required to
submit a verified undertaking. In that
document, the agency assumed all
responsibilities for the proper use of its license
and the proper implementation of the
employment contracts with the workers it
recruited and deployed for overseas
employment. (Royal Crown Internationale v.
NLRC, G.R. No. 78085)
XPN: Where the workers themselves insisted
for the recruitment agency to send them back
to their foreign Er despite their knowledge of its
inability to pay their wages, the agency is
absolved from liability. (Feagle Construction
Corp. v. Gayda, G.R. No. 82310)
Liability if the Recruitment or Placement
Agency is a Juridical Being

If the recruitment/placement agency is a

Illegal Recruitment Estafa juridical being, the corporate officers, directors
Malum prohibitum Malum in se or partners as the case may be, shall
themselves be jointly and solidarily liable with
It is not required that Accused defrauded the corporation or partnership for the claims
it be shown that the another by abuse of and damages. (Becmen Service Exporter
recruiter wrongfully confidence or by and Promotion v. Cuaresma, G.R. Nos.
represented himself means of deceit. 182978-79)
as a licensed
recruiter. NOTE: It is essential Liability of the Foreign Employer
that the false
NOTE: It is enough statement or A foreign corporation which, through
that the victims were fraudulent unlicensed agents, recruits workers in the
deceived as they representation country, may be sued in and found liable by
relied on the constitutes the very Philippine courts; e.g., direct hiring by a foreign
misrepresentation cause or the only firm without participation of POEA. (Azucena,
and scheme that motive which induces 2016)
caused them to the complainant to
entrust their money in part with the thing of Solidary Liability
exchange of what value.
they later discovered Liability of the Private Employment Agency
was a vain hope of and the Principal or Foreign-based
obtaining Employer
employment abroad.
They are jointly and solidarily liable for any
violation of the recruitment agreement and the
contracts of employment.

12
This joint and solidary liability imposed by law
against recruitment agencies and foreign
employers is meant to assure the aggrieved
worker of immediate and sufficient payment of
what is due him. (Becmen Service Exporter
and Promotion v. Cuaresma, G.R. Nos.
182978-79)
Theory of Imputed Knowledge
A rule in insurance law that any information
material to the transaction, either possessed by
the agent at the time of the transaction or
acquired by him before its completion, is
deemed to be the knowledge of the principal,
at least so far as the transaction is concerned,
even though in fact, the knowledge is not
communicated to the principal at all. (Rovels
Enterprises, Inc. v. Ocampo, G.R. No.
136821)
The Theory of Imputed Knowledge teaches
that the knowledge of the agent is knowledge
of the principal. (Sunace International
Management Services, Inc. v. NLRC, et al.,
G.R. No. 161757)
5. Termination of Contract of Migrant
Worker
Relief of a Worker When Terminated
Without Valid Cause
1. Full reimbursement of his placement fee
with 12% interest per annum; and
2. Salaries for the unexpired portion of his
employment contract. (R.A. No. 8042,
as amended by R.A. No. 10022)
Note: The three-month option is declared
unconstitutional for violating the equal
protection clause and the substantive due
process rule in the Constitution. (Serrano v.
Gallant Maritime Services Inc. and Marlow
Navigation Company, Inc., G.R. No. 167614)
This shall be given retroactive effect, because
an unconstitutional clause in the law confers no
rights, imposes no duties, and affords no
protection. The unconstitutional provision is
inoperative, as if it were not passed into law at
all. (Skippers United Pacific, Inc. v. Doza, et.
al, G.R. No. 175558)
However, Sec. 7 of RA 10022 amended Sec.
10 of the Migrant Workers Act, and once again
reiterated the provision as above quoted.
Nonetheless, the Court in the en banc case of
Sameer Overseas Placement Agency, Inc. v.
Joy C. Cabiles (G.R. No. 170139) still
declared such as unconstitutional despite its
replication.
The subject clause contains a “suspect
classification” in that, in the computation of the
monetary benefits of fixed-term Ees who are
illegally discharged, it imposes a three-month
cap on the claim of OFWs with an unexpired
portion of one year or more in their contracts,
but none on the claims of other OFWs or local
workers with fixed-term employment. The
subject clause singles out one classification of
OFWs and burdens it with a peculiar
disadvantage. The clause is a violation of the
right of Serrano to equal protection and right to
substantive due process, for it deprives him of
property, consisting of monetary benefits,
without any existing valid governmental
purpose.
Thus, Serrano is entitled to his salaries for the
entire unexpired period of nine months and 23
days of his employment contract, pursuant to
law and jurisprudence prior to the enactment of
R.A. No. 8042. (Serrano v. Gallant Maritime
Services & Marlow Navigation Co., Inc.,
G.R. No. 167614)
Employment of Non-Resident Aliens
An employment permit may be issued to:
1. A non-resident alien; or
2. The applicant employer, after a
determination of the non-availability of a
person in the Philippines who is
competent and able and willing at the
time of application to perform the
services for which the alien is desired.
Note: For an enterprise registered in preferred
areas of investments, said permit may be
issued upon recommendation of the
Government agency charged with the
supervision of said registered enterprise. (Art.
40, LC)
Persons Required to Obtain Alien
Employment Permit
GR: All foreign nationals who intend to engage
in gainful employment in the Philippine shall
apply for Alien Employment Permit (AEP).
XPN:
1. All members of the diplomatic service
and foreign government officials
accredited by and with reciprocity
arrangement with the Philippines;
2. Officers and staff of international
organizations of which the Philippine
government is a member, and their
legitimate spouses desiring to work in
the Philippines;
3. Owners and representatives of foreign
principals whose companies are
13
 accredited by the POEA, who come to
the Philippines for a limited period and
solely for the purpose of interviewing
Filipino applicants for employment
abroad;
4. Foreign nationals who come to the
Philippines to teach, present and/or
conduct research studies in universities
and colleges as visiting, exchange or
adjunct professors under formal
agreements between the universities
and colleges in the Philippines and
foreign universities or colleges; or
between the Philippine government and
foreign government, provided that the
exemption is on a reciprocal basis;
5. Permanent resident foreign nationals
and probationary or temporary resident
visa holders under Sec. 13(a-f) of the
Philippine Immigration Act of 1940 and
Sec. 3 of the Alien Social Integration Act
of 1995 (R.A. 9717);
6. Refugees and stateless persons
recognized by the DOJ; and
7. All foreign nationals granted exemption
by law. (Sec. 2, D.O. 186-17)
Persons Excluded from Coverage
1. Members of the governing board with
voting rights only and do not intervene in
the management of the corporation or in
the day to day operation of the
enterprise;
2. President and treasurer, who are part-
owner of the company;
3. Those providing consultancy services
who do not have employers in the
Philippines;
4. Intra-corporate transferee who is a
manager, executive or specialist;
5. Contractual service supplier who is a
manager, executive or specialist and an
employee of a foreign service supplier
which has no commercial presence in
the Philippines; and
6. Representative of the Foreign
Principal/Employer assigned in the
Office of Licensed Manning Agency
(OLMA) in accordance with the POEA
law, rules and regulations. (Sec. 3, D.O.
186-17)
Note: All foreign nationals excluded from
securing AEP shall secure a Certificate of
Exclusion from the Regional Office. (Sec. 4,
D.O. 186-17)
Validity of AEP
GR: The AEP shall be valid for the position and
the company for which it was issued for a
period of one (1) year.
XPN: The employment contract, or other
modes of engagement provide otherwise,
which in no case shall exceed three (3) years.
(Sec. 10, D.O. 186-17)
Renewal of AEP
An application for renewal of AEP shall be filed
not earlier than 60 days before its expiration. In
case the foreign national needs to leave the
country or in other similar circumstances that
will hinder the filing of renewal within this
prescribed period, the application may be filed
earlier. (Sec. 11, D.O. 186- 17)
Procedure in the Processing of
Applications for AEP
1. All applications for AEP shall be filed
and processed at the DOLE Regional
Office or Field Office having jurisdiction
over the intended place of work.
2. In the case of foreign nationals to be
assigned in related companies,
applications may be filed in the Regional
Office or Field Office having jurisdiction
over any of the applicant's intended
places of work.
3. Additional position of the foreign
national in the same company or
subsequent assignment in related
companies during the validity or renewal
of the AEP will be subject for publication
requirement. A change of position or
employer shall require an application for
new AEP.
4. At any given time, only one AEP shall
be issued to a foreign national. (Sec. 5,
D.O. 186-17)
Documentary Requirements
A duly accomplished application form with the
following complete documentary requirements
must be submitted:
1. Photocopy of Passport with valid visa,
except for temporary visitor's visa in
case of renewal or Certificate of
Recognition for Refugees or Stateless
Persons;
2. Original copy of notarized appointment
or contract of Employment enumerating
the duties and responsibilities, annual
salary, and other benefits of the foreign
national;
3. Photocopy of Mayor's Permit to operate
business, in case of locators in
economic zones, Certification from the
PEZA or the Ecozone Authority that the
company is located and operating within
the ecozone, while in case of a
construction company, photocopy of
license from PCAB or DO 174-17
Registration should be submitted in lieu
of Mayor's Permit; and
14
 4. Business Name Registration and
Application Form with DTI or SEC
Registration and GIS;
5. If the position title of the foreign national
is included in the list of regulated
professions, a Special Temporary Permit
(STP) from the PRC; and
6. If the employer is covered by the
Anti-Dummy Law, an Authority to
Employ Foreign National (ATEFN) from
the DOJ or from the DENR in case of
mining.
Processing Periods
1. Applications for new AEP - within
three (3) working days after publication
and payment of required fees and fines,
if there are any.
2. Applications for renewal of AEP –
within one (1) day after receipt. (Sec. 8,
D.O. 186- 17)
Publication Requirement
The DOLE Regional Office shall publish in a
newspaper of general circulation all
applications for new AEPs, change or
additional position in the same company or
subsequent assignment in related companies
within two (2) working days from receipt of
application.
The same shall be published in the DOLE
website and posted in the PESO. Such
publication and posting shall be for a period of
30 days and shall contain the name, position,
employer and address, a brief description of
the functions to be performed by the foreign
national, qualifications, monthly salary range
and other benefits, if there are any.
It shall also indicate in the same notice of
publication that any person in the Philippines
who is competent, able and willing at the time
of application to perform the services for which
the foreign national is desired may file an
objection at the DOLE Regional Office. (Sec. 7,
D.O. 186-17)
Objection
Any objection or information against the
employment of the foreign national relative to
labor market test must be filed with the
Regional Office within 30 days after
publication.
The DOLE Regional Office shall refer to the
DOLE's Philjobnet and PESO Employment
Information System (PEIS), the PRC Registry
of Professionals, and the Technical Education
and Skills Development Authority (TESDA)
registry of certified workers to establish
availability or non availability of able and
qualified Filipino worker.
Grounds for Denial of Application for New
or Renewal of AEP
1. Misrepresentation of facts in the
application including fraudulent
misrepresentation (i.e., false statement
that has a negative effect in the
evaluation of the application made
knowingly, or without belief in its truth, or
recklessly whether it is true or false);
2. Submission of falsified documents;
3. Conviction to a criminal offense or a
fugitive from justice in the country or
abroad;
4. Grave misconduct in dealing with or ill
treatment of workers;
5. Availability of a Filipino who is
competent, able and willing to do the job
intended for or being performed by the
foreign national based on data in the
PEIS, PRC Registry of Professional and
TESDA Registry of Certified Workers;
6. Worked without valid AEP for more than
a year; or
7. Application for renewal with an expired
visa or with a temporary visitor's visa.
(Sec. 12, D.O. 186-17)
Note: The Regional Director shall issue an
Order denying the application for new or
renewal of AEP which shall have the effect of
forfeiture of the fees paid by the applicant.
Grounds for Cancellation or Revocation of
AEP
1. Non-compliance with any of the
requirements or conditions for which the
AEP was issued;
2. Misrepresentation of facts in the
application including fraudulent
misrepresentation (i.e., false statement
that has a negative effect in the
evaluation of the application made
knowingly, or without belief in its truth, or
recklessly whether it is true or false);
3. Submission of falsified or tampered
documents;
4. Meritorious objection or information
against the employment of the foreign
national;
5. Foreign national has been convicted of
a criminal offense or a fugitive from
justice;
6. Employer terminated the employment of
foreign national; and
7. Grave misconduct in dealing with or ill
treatment of workers. (Sec. 13, D.O.
186-17)
15
Effect of denial, cancellation, or revocation
of AEP
A foreign national whose AEP has been denied
or cancelled is disqualified to reapply within a
period of ten (10) years in case the grounds for
denial or cancellation is any of the following:
a. Conviction of criminal offense or fugitive
from justice in the country or abroad; or
b. Grave misconduct in dealing with or ill
treatment of workers.
A foreign national whose AEP has been denied
or cancelled due to misrepresentation of facts
or submission of falsified documents with the
intent to deceive, conceal or omit to state
material facts and, by reason of such omission
or concealment, the Department was prompted
to approve/issue the AEP that would not
otherwise have been approved/issued, shall be
disqualified to reapply within a period of five (5)
years. (Sec. 14, D.O. 186- 17)
Employer’s or foreign national's
representatives, and/or agents acting in behalf
of the applicant found to have filed fraudulent
application for AEP for three (3) counts shall be
barred from filing application for a period of five
(5) years after due process. (Sec. 15, D.O.
186-17)
Appeal
The aggrieved foreign national or his
authorized representative may file an appeal
with the SOLE within ten (10) days after receipt
of the copy of denial/ cancellation/ revocation
order.
The decision of the SOLE shall be final and
executory unless a motion for reconsideration
is filed within ten (10) days after receipt of the
decision. No second motion for reconsideration
shall be allowed. (Sec. 16, D.O. 186-17)
Prohibition Against Transfer of Employment
After the issuance of an employment permit,
the alien shall not transfer to another job or
change his employer without prior approval of
the SOLE. (Art. 41(a), LC)
Any non-resident alien who shall take up
employment in violation of the provisions of the
Code and its IRR shall be punished. (Art.
41(b), LC)
Alien workers shall be subject to deportation
after service of his sentence.
Discriminatory Practices
1. Age (RA 10911 or the Anti-Age
Discrimination in Employment Act)
The Department of Labor and Employment
(DOLE) issued Department Order (DO) No.
170, Series of 2017, promulgating the
Implementing Rules and Regulations (IRR) of
Republic Act (RA) No. 10911, otherwise known
as the “Anti-Age Discrimination in Employment
Act”.
The law seeks to promote equality in the
workplace by mandating companies to hire
workers based on their competence, and not
on their age. The IRR apply to all employers,
publishers, labor contractors or subcontractors,
and labor organizations, whether or not
registered.
Unlawful Acts
1. It shall be unlawful for an employer to:
a. Publish job advertisements, in
any form of media, which indicate
or suggest preferences,
limitations, specifications and
discrimination based on age;
b. Require job applicants to declare
their ages during the hiring
process;
c. Decline an applicant based on
age;
d. Provide less compensation and
benefits based on age;
e. Deny promotions or training
opportunities based on age;
f. Forcibly dismiss employees
because of old age; or
g. Impose early retirement.
2. It shall be unlawful for a labor contractor
or subcontractor to refuse to refer for
employment or discriminate against any
individual based on age.
3. It shall be unlawful for a labor
organization to:
a. Deny membership on account of
age;
b. Exclude from its membership
because of the individual’s age;
or
c. Cause or attempt to cause an
employer to discriminate against
an individual based on age.
4. It shall also be unlawful for a publisher
to print or publish any notice of
advertisement relating to employment
suggesting preferences, limitations,
specifications, and discrimination based
on age.
16
Exceptions
It shall be lawful for an employer to set age
limitations in employment if age is a bona fide
occupational qualification reasonably
necessary in the normal operation of a
particular business or where the differentiation
is based on reasonable factors;
Based on jurisprudence, the employer must
prove two factors:
a. that the employment qualification is
reasonably related to the essential
operation of the job involved; and
b. 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.
1. The intent to observe the terms of bona
fide seniority system that is not intended
to evade the purpose of Rules;
2. The intent is to observe the terms of a
bona fide employee retirement or a
voluntary early retirement plan; or
3. The action is duly certified by the
Secretary of Labor and Employment
after consultation with the stakeholders.
For purposes of the exceptions, an employer
who invokes the qualifications, shall submit a
report prior to its implementation to the DOLE
Regional Office which has jurisdiction over the
workplace.
Penalty
Any violation of RA No. 10911 shall be
punished with a fine of not less than
P50,000.00 but not more than P500,000.00, or
imprisonment of not less than 3 months but not
more than 2 years, or both, at the discretion of
the court. If the offense is committed by a
corporation, trust, firm partnership or
association, the penalty shall be imposed upon
the guilty officer or officers.
2. Gender and/or Marital Status (RA 9710 or
the Magna Carta of Women)
Persons covered under the classification of
certain women workers
1. Any woman who is permitted or suffered
to work:
2. With or without compensation;
3. In any night club, cocktail lounge, clinic,
bar or similar establishment; massage
4. Under the effective control or
supervision of the employer for a
substantial period of time; and
5. Shall be considered as an employee of
such establishment for purposes of
labor and social legislation. [Art. 136,
Labor Code]
What are instances of discriminatory acts
against women employees?
1. Discrimination in pay - Payment of a
lesser compensation including wage,
salary or other forms of remuneration
and fringe benefits, to a female
employee as against a male employee.
2. Discrimination in employment
opportunity - favoring a male employee
over a female employee with respect to
promotion, assignment, transfer, training
opportunities, study and scholarship
grants solely in account or their sexes.
3. Discrimination in hiring - favoring a male
applicant with respect to hiring where
the particular job can equally be handled
by a woman;
4. Discrimination in dismissal - favoring a
male employee over a female employee
with respect to dismissal of personnel or
the application of the last in / first out
principle or other retrenchment policy of
the employer.
5. Stipulating, whether as a condition for
employment or continuation of
employment:
a. That a woman employee shall not get
married; or
b. If she gets married shall be deemed
resigned or separated; or
c. Actual dismissal on account of marriage.
How did the Magna Carta for Women
protect the rights of Women workers?
The Magna Carta for women has expressly
disallowed the discharge any woman for the
following reasons:
1. For the purpose of preventing her from
enjoying any of the benefits provided by
law
2. On account of her pregnancy, or while
on leave or in confinement due to her
pregnancy.
Pregnancy
Article 135 of the Labor Code and recent
jurisprudence declares that an employee
cannot be dismissed on account of her
pregnancy and its related ailments.
In the case of Del Monte Philippines, Inc. vs.
Velasco, the Court concurs with the CA
likewise ruling that respondent’s sickness was
pregnancy-related and, hence the petitioner
cannot terminate respondent’s services. [Del
Monte Philippines, Inc. vs. Velasco, G.R.
No. 153477]
17
If an employee conceals her pregnancy and
incurs absences without official leave
Absence on account of childbirth can hardly be
considered a forbidden act or a dereliction of
duty; much less does it imply wrongful intent on
the part of the employee. [Lakpue Drug, Inc.
vs. Belga, G.R. No. 166379]
Special Leave for Women
Time period for special leave for women
For two (2) months with full pay from her
employer based on her gross monthly
compensation following surgery caused by
gynecological disorders, provided that she has
rendered continuous aggregate employment
service of at least six (6) months for the last 12
months. This two-month leave is in addition to
leave privileges under existing laws. [D.O.
112-11, Sec. 1(a)]
Gynecological disorders
Disorders that would require surgical
procedures of female reproductive organs such
as the vagina, cervix, uterus, fallopian tubes,
ovaries, breast, adnexa and pelvic floor. It
includes hysterectomy, ovariectomy, and
mastectomy. [D.O. 112-11, Sec. 1 (b)]
Requirements for special leave
1. She has rendered 6 months of
continuous aggregate employment
service within 12 months prior to the
surgery.
2. She has filed an application for special
leave in accordance with Section 3.
3. She has undergone surgery due to
gynecological disorders as certified by a
competent physician. [D.O. 112-11, Sec.
2]
Time period for filing an application
1. Within a reasonable time before the
surgery
2. Within a time period provided by
company regulations and by the
Collective Bargaining Agreement [D.O.
112-11, Sec. 3]
Note: Prior application is not required in
emergency cases
Prior application for leave shall not be
necessary in cases requiring emergency
surgical procedure provided:
a. Employer shall be informed verbally or
in written form within a reasonable
period of time.
b. Further, after surgery, the employee
after the surgery or 18 the recuperating
period shall file her application.
Expanded Maternity Leave
Eligibility
To qualify for the grant of maternity leave
benefit, the female worker must meet the
following requirements:
a. 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
b. 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 [Implementing Rules and
Regulations of R.A. 11210 Sec. 1 Rule
VI].
Notice Requirement
The notification process for SSS-covered
female workers and/or members and
employers shall be governed by the following
rules:
1. The female member, upon confirmation
of pregnancy, shall immediately inform
her employer of such fact and the
expected date of childbirth;
2. The employer shall, in turn, notify the
SSS through the prescribed manner;
3. 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; and
4. Self-employed female members,
including those in the informal economy,
OFWs and voluntary SSS members
may give notice directly to the SSS
[Implementing Rules and Regulations
of R.A. 11210, Sec. 2, Rule VI]
Benefits Granted
For employees in the public sector:
1. Paid leave benefit granted to a qualified
female worker in the public sector, for
One Hundred Five (105) days for live
childbirth, regardless of the mode of
delivery, plus fifteen (15) days paid
leave if the female worker qualifies as a
solo parent
2. Sixty (60) days paid leave in case of
miscarriage and emergency termination
of pregnancy.
18

For employees in the private sector:
1. For the duration of One Hundred Five
(105) days for live childbirth, regardless
of the mode of delivery, plus additional
fifteen (15) days paid leave if the female
worker qualifies as a solo parent.
2. Sixty (60) days paid leave for
miscarriage and emergency termination
of pregnancy:
a. Employed female workers shall
receive full pay which consists of (1)
SSS maternity benefit computed
based on their average daily salary
credit and
b. salary differential to be paid by the
employer, if any.
Extension of Leave
An option to extend for an additional thirty (30)
days without pay in case of live childbirth.
If the female worker gets pregnant
frequently
Maternity leave shall be granted to a qualified
female worker in every instance of pregnancy,
miscarriage or emergency termination of
pregnancy regardless of frequency.
Maternity leave benefits after termination of
employment
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. [R.A.
11210, Sec. 8]
Health care services for pre-natal, delivery,
postpartum and pregnancy-related conditions
granted to female workers, particularly those
who are neither voluntary nor regular members
of the SSS, as governed by the existing rules
and regulations of the Philippine Health
Insurance Corporation (PhilHealth).
Role of Local Government Units in
implementing the Magna Carta for Women
LGUs shall implement gender responsive local
ordinances that promote the comprehensive
health of girls, such as:
1. Gender and Development (GAD) code
2. Reproductive Health Code
It shall formulate Resource Development Plan
that will ensure the following:
1. Sufficient number of skilled health
professionals to attend all deliveries.
2. Availability of qualified and capable
health service providers
The LGU shall also:
1. Develop and allocate budget for health
programs
2. Monitor the implementation of health
programs
3. Enhance Parent Effectiveness Services
and Programs to include continuing
education on gender-based violence in
every barangay such as:
a. VAWC (Violation against women and
children)
b. Rape
c. Incest
d. Prostitution
e. Trafficking
4. Coordinate with DOH on the provision of
health services
5. Strengthen the Local Health Board by:
a. Developing an award system to
encourage excellent performance on
women's health programs.
b. Organizing communities/ dialogues
with the private sector to implement
health programs for women and girls
c. Encourage to strengthen advocacy,
participation and assist the LGUs on
the implementation of the health
programs.
3. Health Condition (RA 7277 or the Magna
Carta for Disabled Persons)
Health
National Health Program. — The Department
of Health in coordination with the National
Council for the Welfare of Disabled Persons,
shall institute a national health program which
shall aim to attain the following:
1. prevention of disability, whether
occurring prenatally or postnatally;
2. recognition and early diagnosis of
disability; and
3. early rehabilitation of the disabled
Employment
Equal Opportunity for Employment
No disabled 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
19
engaged in social development shall be
reserved for disabled persons.
Sheltered Employment
If suitable employment for disabled persons
cannot be found through open employment as
provided in the immediately preceding Section,
the State shall endeavor to provide it by means
of sheltered employment. In the placement of
disabled persons in sheltered employment, it
shall accord due regard to the individual
qualities, vocational goals and inclinations to
ensure a good working atmosphere and
efficient production.
Apprenticeship
Subject to the provisions of the Labor Code as
amended, disabled persons shall be eligible as
apprentices or learners: Provided, That their
handicap is not as much as to effectively
impede the performance of job operations in
the particular occupation for which they are
hired; Provided, further, That after the lapse of
the period of apprenticeship, if found
satisfactory in the job performance, they shall
be eligible for employment.
Incentives for Employers
1. To encourage the active participation of
the private sector in promoting the
welfare of disabled persons and to
ensure gainful employment for qualified
disabled persons, adequate incentives
shall be provided to private entities
which employ disabled persons.
2. 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-five percent (25%) of the total
amount paid as salaries and wages to
disabled persons:
Provided, however, That such entities
present proof as certified by the
Department of Labor and Employment
that disabled persons 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.
3. Private entities that improve 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.
Vocational Rehabilitation
Consistent with the principle of equal
opportunity for disabled workers and workers in
general, the State shall take appropriate
vocational rehabilitation measures that shall
serve to develop the skills and potentials of
disabled persons and enable them to compete
favorably for available productive and
remunerative employment opportunities in the
labor market.
4. Solo Parents (Sec. 7, RA 8972, as
amended by RA 11861)
Categories of Solo Parent
Under the new law, the coverage of Solo
Parents is expanded to include the spouse or
any family member of a low/semi-skilled
Overseas Filipino Workers (OFW) who is away
from the country for an uninterrupted period of
twelve (12) months. The coverage also
includes solo grandparents who have sole
parental care over their grandchildren.
The law reduces the period before a person
can qualify to become a solo parent due to
abandonment and legal separation from one
(1) year to six (6) months. Additionally, the
period of detention or sentence of a spouse for
a criminal conviction is also reduced from one
(1) year to three (3) months to become a solo
parent.
Comprehensive Package of Social
Protection Services
Under Section 5 of RA 11862, the Department
of Social Welfare and Development (“DSWD”)
Secretary, in coordination with the heads of
several government agencies, civil society
organizations, and nongovernmental
organizations (NGOs), shall develop a
comprehensive package of social protection
services for solo parents and their families.
Parental Leave and Telecommuting
Programs
Under Section 7 and 8, a solo parent is now
entitled to a forfeitable and cumulative parental
leave of not more than seven (7) days as long
as they have worked for at least six (6) months,
as compared to the old law wherein they must
render one (1) year of service. Solo parents will
also be given priority in a telecommuting
program, as provided in Republic Act 11165 or
the “Telecommuting Act.”
20
Educational Benefits
RA 11862 shall also provide that scholarship
programs will be given to solo parents and a
full school scholarship for one (1) child of a
solo parent in institutions of basic, higher, and
technical vocational skills education as long as
they meet the qualifications of the program.
Priority shall also be given to other children of
the solo parent, if any, in accordance with the
law.
Under the same section, the children must be
(i) dependent on the solo parent for support, (ii)
unmarried, (iii) unemployed, and (iv) 22 years
old and below.
Social Safety Assistance
Under Section 14, solo parents and their
children shall be entitled to social safety
assistance, such as food, medicine, and
financial aid during disasters, calamities,
pandemics, and other public health crises as
declared by the Department of Health.
Additional Benefits
Under Section 15, additional benefits added in
the new law are listed as follows:
1. A cash subsidy of P1,000 per month for
solo parents earning minimum wage
and below;
2. A ten percent (10%) discount and
value-added tax (VAT) exemption on
baby’s milk, food, supplements, and
diapers until the child is 6 years old for
solo parents earning less than
P250,000;
3. Automatic overage under the National
Health Insurance Program (NHIP) with
premium contributions to be paid by the
National Government;
4. Prioritization of solo parents, especially
solo mothers in re-entering the
workforce, and their children as
applicable, in apprenticeships,
scholarships, livelihood training,
reintegration programs for OFWS,
employment information and matching
services, and other poverty alleviation
programs;
5. Preference in low-cost housing projects
and liberal terms of payment.
Protection for Abused, Abandoned,
Neglected, and Adolescent Solo Parents
Section 22 provides that solo parents who
have been abused, abandoned, or neglected
by his or her co-parent may seek the help of
the DSWD, who shall coordinate with the
respective barangay officials and/or police
officers. If the alleged abusive co-parent is
gainfully employed, the abused, abandoned, or
neglected parent shall have the right to retain a
portion of the former’s income for the support
of the child.
The subsequent section extends assistance to
adolescent solo parents, including victims of
child marriages. He or she may seek
assistance from the DSWD and DOH for the
purpose of counseling and other services.
Employment Proper
Management Prerogative
GR: Management prerogative is the right of
the employer to regulate all aspects of
employment, such as:
1. Freedom to prescribe work
assignments;
2. Working methods;
3. Processes to be followed;
4. Regulation regarding transfer of Ees;
5. Supervision of their work, lay-off and
discipline; and
6. Dismissal and recall of work. (Goya,
Inc. v. Goya, Inc. Ees Union-FFW,
G.R. No. 170054).
Note: It presupposes the existence of an Er-EE
relationship. (Goya, Inc. v. Goya, Inc,
Employees Union-FFW, G.R. No. 170054)
So long as the company’s prerogatives are
exercised in good faith for the advancement of
the employer’s interest and not for the purpose
of defeating or circumventing the rights of the
employees under special laws or under valid
agreements, the SC will uphold them. (San
Miguel Brewery Sales v. Ople, G.R. No.
53515)
An employer is free to regulate, according to
his best discretion and best business
judgement, all aspects of employment, from
hiring to firing, except in cases of unlawful
discrimination or those which may be provided
by law. (Philippine Telegraph and Telephone
Company v. NLRC, G.R. No. 118978)
The Secretary of Labor and Employment is
duly mandated to equally protect and respect
not only the laborer or worker’s side but also
the management and/or employer’s side. The
law, in protecting the rights of the laborer,
authorizes neither oppression nor
self-destruction of the employer. (Colgate
Palmolive, Inc v. Ople, G.R. No. 73681)
XPN: Otherwise limited by law, contract, and
principles of fair play and justice.
21
1. Discipline
Employer's Right to Discipline His
Employees
The employer has the prerogative to instill
discipline in his employees and to impose
reasonable penalties, including dismissal, on
erring employees pursuant to company rules
and regulations. (San Miguel Corporation v.
NLRC, G.R. No. 87277)
Company policies and regulations are, unless
shown to be grossly oppressive or contrary to
law, generally binding and valid on the parties.
(China Banking Corp. v. Borromeo, G.R. No.
156515)
Limitation On The Employer’s Power To
Discipline
While management has the prerogative to
discipline its Ees and to impose appropriate
penalties on erring workers, pursuant to
company rules and regulations, however, such
management prerogative must be exercised
in good faith for the advancement of the Er’s
interest and not for the purpose of defeating or
circumventing the rights of the Ees under
special laws and valid agreements. (PLDT v.
Teves, G.R. No. 143511)
2. Transfer of Employees
Transfer is the lateral movement from one
position to another of equivalent rank, level, or
salary without break of service.
Conditions for a valid exercise by the
employer of its right to transfer employees
The transfer should:
1. Not be unreasonable, inconvenient, or
prejudicial to the employee; and
2. Not involve a demotion in rank,
diminution in salaries, benefits and other
privileges concerning the transfer.
Employer’s Right to Transfer and Reassign
Employees
In the pursuit of its legitimate business
interests, especially during adverse business
conditions, management has the prerogative to
transfer or assign Ees from one office or area
of operation to another provided there is no
demotion in rank or diminution of salary,
benefits and other privileges and the action is
not motivated by discrimination, bad faith, or
effected as a form of punishment or demotion
without sufficient cause. This privilege is
inherent in the right of Ers to control and
manage their enterprises effectively.
Note: The right of Ees to security of tenure
does not give them vested rights to their
positions to the extent of depriving
management of its prerogative to change their
assignments or to transfer them. (Endico v.
Quantum Foods Distribution Center, G.R.
No. 161615)
Promotion of Ee
There is no law that compels an Ee to accept
promotion. Promotion is in the nature of a gift
or a reward which a person has a right to
refuse. When an Ee refused to accept his
promotion, he was exercising his right and
cannot be punished for it. While it may be true
that the right to transfer or reassign an Ee is an
Er’s exclusive right and the prerogative of
management, such right is not absolute.
(Dosch v. NLRC and Northwest Airlines,
G.R. No. 51182)
Burden of Proving that the Transfer was
Reasonable
The Er must be able to show that the transfer
is not unreasonable, inconvenient, or
prejudicial to the Ee; nor does it involve a
demotion in rank or a diminution of his salaries,
privileges and other benefits. Should the Er fail
to overcome this burden of proof, the Ee’s
transfer shall be tantamount to constructive
dismissal. (Blue Dairy Corporation v. NLRC,
G.R. No. 129843)
3. Productivity Standard
Imposition of productivity standards for
workers
An Er is entitled to impose productivity
standards for its workers. In fact,
non-compliance may be visited with a penalty
even more severe than demotion. The practice
of a company in laying off workers because
they failed to make the work quota has been
recognized in this jurisdiction. Failure to meet
the sales quota assigned to each of them
constitute a just cause for their dismissal,
regardless of the permanent or probationary
status of their employment.
Likewise, failure to observe prescribed
standards of work or to fulfill reasonable work
assignments due to inefficiency may constitute
just cause for dismissal. Such inefficiency is
understood to mean failure to attain work goals
or work quotas, either by failing to complete the
same within the allotted reasonable period, or
by producing unsatisfactory results.
This management prerogative of requiring
standards may be availed of so long as they
are exercised in good faith for the
advancement of the Er’s interest. (Leonardo v.
NLRC, G.R. No. 125303)
22
4. Bonus
Bonus
It is an amount granted and paid to an Ee for
his industry and loyalty which contributed to the
success of the Er’s business and made
possible the realization of profits.
Demandability of Bonus
Bonus is not demandable as a matter of right.
It is a management prerogative given in
addition to what is ordinarily received by or
strictly due to recipient. (Producers Bank of
the Phil. v. NLRC, G.R. No. 100701)
XPNs: Given for a long period of time,
provided that:
a. Consistent and deliberate – Er
continued giving benefit without any
condition imposed for its payment;
b. Er knew he was not required to give
benefit;
c. Nature of benefit is not dependent on
profit;
d. Made part of the wage or compensation
agreed and stated in the employment
contract;
e. It was promised to be given without any
conditions imposed for its payment in
which case it is deemed part of the
wage; and
f. It has ripened into practice. (Marcos v.
NLRC, G.R. No. 111744)
Elimination or diminution of benefits may
constitute constructive dismissal or
indicate demotion.
Constructive dismissal is an involuntary
resignation resorted to when continued
employment is rendered impossible,
unreasonable or unlikely; when there is a
demotion in rank and/or a diminution in pay; or
when a clear discrimination, insensibility or
disdain by an employer becomes unbearable
to the employee. (Phil. Wireless Inc. v. NLRC,
G.R. No. 112963).
Granting of Bonus - Management
Prerogative
The granting of a bonus is a management
prerogative, something given in addition to
what is ordinarily received by or strictly due the
recipient. An Er cannot be forced to distribute
bonuses when it can no longer afford to pay. To
hold otherwise would be to penalize the Er for
his past generosity. (Producers Bank of the
Phil. v. NLRC, G.R. No. 100701)
5. Change of Working Hours
Er’s Right to Change Working Hours
The working hours may be changed, at the
discretion of the company, should such change
be necessary for its operations, and that
employees shall observe such rules as have
been laid down by the company. (Interphil
Laboratories Union-FFW v. Interphil
Laboratories, Inc., G.R. No. 142824)
Management retains the prerogative, whenever
exigencies of the service so require, to change
the working hours of its employees. The
exercise of management prerogative, however,
is not absolute as it must be exercised in good
faith and with due regard to the rights of labor.”
(Royal Plant Workers Union v. Coca-Cola
Bottlers Phil., Inc., G.R. No. 198783)
Reduction of hours under Art. 83
Art. 83 provides that the normal hours of work
of an Ee shall not exceed eight (8) hours a day.
This implies that the Er, in the exercise of its
management prerogatives, may schedule a
work shift consisting of less than eight (8)
hours. And following the principle of “a fair
day’s wage for a fair day’s labor,” the Er is not
obliged to pay an Ee, working for less than
eight (8) hours a day, the wages due for eight
(8) hours.
Nonetheless, if by voluntary practice or policy,
the Ee for a considerable period of time has
been paying his Ees’ wages due for 8 hours
work although the work shift less than 8 hours,
it cannot later on increase the working hours
without an increase in the pay of the Ees
affected. An Er is not allowed to withdraw a
benefit which he has voluntarily given.
6. Bona Fide Occupational Qualifications
Where the job itself necessarily requires a
particular question qualification, then the job
applicant or worker who does not possess it
may be disqualified on that basis. This will not
be unlawful discrimination. (Azucena, 2016)
Requisites
To justify a BFOQ, the Er must prove two
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. (Star Paper v. Simbol, G.R.
No. 164774)
Note: BFOQ is related to the Reasonable
Business Necessity Rule. This means there
must be business necessity for ER to require
23
certain attributes possessed by a person in
relation to the job it is to be done or performed.
Otherwise, if you are discriminating against
people and the standard qualification is not at
all relevant to the job that is to be performed
then one will be guilty of discrimination.
SSCW failed to adduce substantial evidence to
prove that the petitioner’s indiscretion indeed
caused grave scandal to SSCW and its
students. Other than the SSCW’s bare
allegation, the records are bereft of any
evidence that would convincingly prove that the
petitioner’s conduct indeed adversely affected
SSCW’s integrity in teaching the moral
doctrines, which it stands for. The petitioner is
only a non-teaching personnel; her interaction
with SSCW’s students is very limited. Itis thus
quite impossible that her pregnancy out of
wedlock caused such a grave scandal, as
claimed by SSCW, as to warrant her dismissal.
(Leus v. St. Scholastica’s College
Westgrove, G.R. 187226)
SSCW, as employer, undeniably has the right
to discipline its employees and, if need be,
dismiss them if there is a valid cause to do so.
However, as already explained, there is no
cause to dismiss the petitioner. Her conduct is
not considered by law as disgraceful or
immoral. Further, the respondents themselves
have admitted that SSCW, at the time of the
controversy, does not have any policy or rule
against an employee who engages in
pre-marital sexual relations and conceives a
child as a result thereof. There being no valid
basis in law or even in SSCW’s policy and
rules, SSCW’s dismissal of the petitioner is
despotic and arbitrary and, thus, not a valid
exercise of management prerogative.
Glaxo has a right to guard its trade secrets,
manufacturing formulas, marketing strategies
and other confidential programs and
information from competitors, especially so that
it and Astra are rival companies in the highly
competitive pharmaceutical industry. (Duncan
v. Glaxo, G.R. No. 162994)
The prohibition against personal or marital
relationships with employees of competitor
companies upon Glaxo’s employees is
reasonable under the circumstances because
relationships of that nature might compromise
the interests of the company. In laying down
the assailed company policy, Glaxo only aims
to protect its interests against the possibility
that a competitor company will gain access to
its secrets and procedures.
7. Marriage Between Employees of
Competitor-Employers
It shall be unlawful for the Er to:
1. Require as a condition of employment or
continuation of employment that a
woman Ee shall not get married;
2. Stipulate expressly or tacitly that upon
getting married, a woman Ee shall be
deemed resigned or separated; or
3. Actually dismiss, discharge, discriminate
or otherwise prejudice a woman Ee
merely by reason of her marriage. (Art.
134, LC)
No-Spouse Employment Policy
It is a policy banning spouses from working in
the same company.
GR: Spouses are allowed to work in the same
company, provided it is not in the same
department, where there is direct supervision
or control. In case spouses are in the same
department, one of them may be reassigned to
another department.
XPN: The XPN of Bonafide Occupational
Qualification occurs when the Er can prove that
reasonable demands of the business require a
distinction based on marital status and there is
no better or acceptable policy which would
better accomplish the business purpose.
There must be a finding of any BFOQ to justify
an Er’s no-spouse employment rule. There
must be a compelling business necessity for
which no alternative exists other than the
discriminating practice.
Importance of the BFOQ
1. To ensure that the Ee can effectively
perform his work;
2. So that the no-spouse employment rule
will not impose any danger to business.
Prohibited Acts
It shall be unlawful for any Er to:
1. Deny any woman Ee benefits provided
by law.
2. Discharge any woman for the purpose
of preventing her from enjoying any of
the benefits provided by law.
3. Discharge such woman on account of
her pregnancy, or while on leave or in
confinement due to her pregnancy.
4. Discharge or refuse the admission of
such woman upon returning to her work
for fear that she may again be pregnant.
(Art. 135, LC)
Discharging a woman due to pregnancy
The following are prohibited acts in connection
with the pregnancy of a woman Ee:
1. To discharge her on account of her
pregnancy; or
2. To discharge her while she is on leave
due to her pregnancy; or
24
 3. To discharge her while she is confined
due to her pregnancy; or
4. To discharge her upon returning to work
for fear that she may again be pregnant.
5. To refuse her admission upon returning
to work for fear that she may again be
pregnant.
6. Expulsion and non-readmission of
women faculty/female student due to
pregnancy outside of marriage.
Series of absences due to pregnancy and
its related ailments not a ground to dismiss
Ee
The court agreed that in concluding that
respondent’s sickness was pregnancy-related
and therefore, the petitioner cannot terminate
respondent’s services because in doing so,
petitioner will be violating Art. 137 (now Art.
135) of the LC. (Del Monte Philippines, Inc. v.
Velasco, G.R. No. 153477)
Penalty for commission of the prohibited
acts mentioned
The offender would be subject to the penalties
provided under Art. 287 of the LC, the general
penalty clause under said code.
Fine: Not less than P1,000 nor more than
P10,000; or
Imprisonment: not less than three (3) months
or more than three years, or both, at the
discretion of the court.
Persons covered under the classification of
certain women workers
Any woman who is permitted or suffered to
work:
1. With or without compensation;
2. In any night club, cocktail lounge,
massage clinic, bar or similar
establishment;
3. Under the effective control or
supervision of the Er for a substantial
period of time; and
4. Shall be considered as an Ee of such
establishment for purposes of labor and
social legislation. (Art. 136, LC)
8. Post-Employment Restrictions
Types of Restrictive Covenants
1. Non-compete clause - When the
employee is prevented from directly
competing or working for a competitor of
his former employer, or when the
employee is prevented from setting up a
competing business.
2. Non-solicitation clause - When a duty
is imposed on the employee not to
approach his former employer’s
customers or prospective customers, or
when the employee is prevented from
taking customers/clients of his former
employer.
3. Non-poaching clause - When the
employee is prevented from enticing his
former employer’s staff away from the
business, the aim is to prevent the
employee from taking key employees
with him to his new employment or
business.
Factors to consider to enforce a restrictive
covenant
1. Whether the covenant protects a
legitimate business interest of the
employer;
2. Whether the covenant creates an undue
burden on the employee;
3. Whether the covenant is injurious to the
public welfare;
4. Whether the time and territorial
limitations contained in the covenant are
reasonable; and
5. Whether the restraint is reasonable from
the standpoint of public policy. (Rivera
v. Solidbank Corporation, G.R. No.
163269)
Non-Involvement Clause
A non-involvement clause is not necessarily
void for being in restraint of trade if there are
reasonable limitations as to time, trade, and
place. It was also stated in this case that the
Labor Law validity of a non-involvement clause
depends upon the nature of work of the subject
employee. (Daisy Tiu v. Platinum Plans, G.R.
No. 163512)
Labor Standards
Employer – Employee Relationship
Employer is any person, natural or juridical,
domestic or foreign, who carries on in the
Philippines any trade, business, industry,
undertaking or activity of any kind and uses the
services of another person, who is under his
orders as regards the employment, except the
Government and any of its political
subdivisions, branches or instrumentalities,
including corporations owned or controlled by
the Government.
The employer may be a natural or juridical
person. It may be a single proprietor, a
partnership or a corporation.
Employer includes any person acting in the
interest of an employer, directly or indirectly.
The term shall not include any labor
organization or any of its officers or agents
25
except when acting as employer. (Art. 219(e),
LC)
Employee is any person who performs
services for an employer in which either or both
mental and physical efforts are used and who
receives compensation for such services,
where there is an employer-employee
relationship. (R.A. No. 8282, Social Security
Law)
Only a natural person can qualify as an
employee. Natural persons may include
Filipino citizens and foreigners.
Employee includes any person in the employ of
an employer. The term shall not be limited to
the employees of a particular employer, unless
the Code so explicitly states. It shall include
any individual whose work has ceased as a
result of or in connection with any current labor
dispute or because of any unfair labor practice
if he has not obtained any other substantially
equivalent and regular employment. (Art.
219(f), LC)
Note: A self-employed person shall be both an
employee and employer at the same time.
Existence of an Employment Relationship
Employment relationship is determined by law
and not by contract. (Insular Life Assurance
Co. Ltd. v. NLRC, G.R. No. 119930)
Note: Taxi or jeepney drivers under the
“boundary” system are Ees of the taxi or
jeepney owners/operators; also the passenger
bus drivers and conductors. (Jardin v. NLRC
and Goodman Taxi, G.R. No. 119268)
Employer-Employee Relation as a Question
of Law (Stipulation that No Er-Ee
Relationship Exists)
The existence of an employer-employees
relation is a question of law and being such, it
cannot be made the subject of agreement.
(Tabas v. California Manufacturing Co., Inc.,
G.R. No. 80680)
It is axiomatic that the existence of an Er-Ee
relationship cannot be negated by expressly
repudiating it in the management contract and
providing therein that the Ee is an independent
contractor when the terms of the agreement
clearly show otherwise. For, the employment
status of a person is defined and prescribed by
law and not by what the parties say it should
be. In determining the status of the
management contract, the Four- Fold Test on
employment has to be applied. (Insular Life
Assurance Co. Ltd. v. NLRC, G.R. No.
119930)
Employer-Employee Relation as a Question
of Fact
The existence of an employer-employee
relationship depends upon the facts of each
case. (Social Security System v. CA, G.R.
No. 100388)
Employment as a Property Right
Once an employer-employee relationship is
established, such employment is treated, under
our constitutional framework, as a property
right. When a person has no property, his job
may possibly be his only possession or means
of livelihood and those of his dependents.
When a person loses his job, his dependents
suffer as well. The worker should, therefore, be
protected and insulated against any arbitrary
deprivation of his job. (Philips
Semiconductors, Inc. v. Fadriquela, G.R.
No. 141717)
Test To Determine Existence
Four-Fold Test
Factors determining the existence of an
employer-employee relationship:
1. Selection and engagement of the
employee;
2. Payment of wages;
3. Power of dismissal; and
4. Power of control, or the Control Test.
(Azucena, 2016)
It is the so-called “control test” that is the
most important element.
Absent the power to control the Ee with respect
to the means and methods by which his work
was to be accomplished, there is no Er-Ee
relationship between the parties. (Continental
Marble Corp., et.al v. NLRC, G.R. No. 43825)
Control Test
The control test assumes primacy in the overall
consideration. There is an Er-Ee relationship
when the person for whom the services are
performed reserves the right to control not only
the end achieved but also the manner and
means used to achieve that end. (Television
and Production Exponents, Inc. v. Servaña,
G.R. No. 167648)
The power of control refers to the existence of
power and not necessarily to the actual
exercise thereof. It is not essential for the
employer to actually supervise the
performance of duties of the Ee; it is enough
that the employer has the right to wield that
power. (Republic v. Asiapro Cooperative,
G.R. No. 172,101)
26
Exclusivity of service, control of assignments
and removal of agents under private
respondents’ unit, collection of premiums,
furnishing of company facilities and materials
as well as capital described as Unit
Development Fund are but hallmarks of the
management system where there can be no
escaping the conclusion that one is an Ee of
the insurance company. (Insular Assurance
Co., Ltd., v. NLRC, G.R. No. 119930)
The control test calls merely for the existence
of the right to control the manner of doing the
work, not the actual exercise of the right.
(Zanotte Shoes v. NLRC, G.R. No. 100665)
Kinds of Control Exercised by an Er
Not every form of control will have the effect of
establishing an Er-Ee relationship. Thus, a line
should be drawn between:
a. Rules that merely serve as guidelines,
which aims only to promote the result. In
such case, no Er-Ee relationship exists.
b. Rules that fix the methodology and bind
or restrict the party hired to the use of
such means or methods. These
addresses both the result and the
means employed to achieve it and
hence, Er-Ee relationship exists.
(Insular Life Assurance Co. v. NLRC,
G.R. 84484)
The main determinant therefore is whether the
rules set by the employer are meant to control
not just the results but also the means and
methods. (Orozco v. CA, G.R. 155207)
Note: However, in certain cases the control test
is not sufficient to give a complete picture of
the relationship between the parties, owing to
the complexity of such a relationship where
several positions have been held by the
worker. The better approach is to adopt the
two-tiered test. (Francisco v. NLRC, G.R. No.
170087)
Economic Dependence (Two-Tiered Test)
This two-tiered test provides us with a
framework of analysis, which would take into
consideration the totality of circumstances
surrounding the true nature of the relationship
between the parties. This is especially
appropriate in this case where there is no
written agreement or terms of reference to
base the relationship on and due to the
complexity of the relationship based on the
various positions and responsibilities given to
the worker over the period of the latter’s
employment. (Francisco v. NLRC, G.R. No.
170087, 31 Aug. 2006)
Elements
1. The putative Er’s power to control the
Ee with respect to the means and
methods by which the work is to be
accomplished (Four-fold Test); and
2. The underlying economic realities of the
activity or relationship. (Economic
Reality Test).
Proper Standard for Economic Dependence
The proper standard is whether the worker is
dependent on the alleged Er for his continued
employment in that line of business.
The determination of the nature of the
relationship between Er and Ee depends upon
the circumstances of the whole economic
activity, such as:
1. The extent to which the services
performed are an integral part of the
Er’s business;
2. The extent of the worker’s investment in
equipment and facilities;
3. The nature and degree of control
exercised by the Er;
4. The worker’s opportunity for profit and
loss;
5. The amount of initiative, skill, judgment,
or foresight required for the success of
the claimed independent enterprise;
6. The permanency and duration of the
relationship between the worker and Er;
and
7. The degree of dependency of the
worker upon the Er for his continued
employment in that line of business.
Evidence of Employment: ID, Voucher, SSS
Registration, Memorandum
No particular form of evidence is required to
prove the existence of such relationship. Any
competent and relevant evidence to prove the
relationship may be admitted. (Domasig vs.
NLRC, G.R. No. 118101)
Absence of Name in the Payroll
In Opulencia Ice Plant v. NLRC (G.R. No.
98368), the Supreme Court disagreed with the
employer’s argument that the absence of the
complainant’s name in the payroll disapproved
his being an employee.
It held that, “if only documentary evidence
would be required to show that relationship, no
scheming employer would ever be brought
before the bar of justice, as no employer would
wish to come out with any trace of illegality he
has authored considering that it should take
much weightier proof to invalidate a written
instrument.”
27
Thus, since the Er-Ee relationship in this case
was sufficiently proven by testimonial evidence,
the absence of time sheet, time record or
payroll became inconsequential. (Azucena,
2016)
Mode of Compensation: Not Determinative
of Er- Ee Relationship
The presence or absence of Er-Ee relationship
is not determined by the basis of the Ee’s
compensation. The compensation, whether
called wage, salary, commission or other
name, may be computed on the basis of time
spent on the job or it may be based on the
quality and/or quantity of the work done. It may
further be dependent on skills possessed,
seniority earned, or performance and initiative
shown by the Ee.
Piece-rate, boundary, and pakyaw are merely
methods of pay computation and do not prove
whether the payee is an Ee or not. (Azucena,
2016)
Boundary-Hulog System
Under the boundary-hulog scheme, a dual
juridical relationship was created: that of Er-Ee
and vendor-vendee. The boundary system is a
scheme by an owner/operator engaged in
transporting passengers as a common carrier
to primarily govern the compensation of the
driver, that is, the latter’s daily earnings are
remitted to the owner/operator less the excess
of the boundary which represents the driver’s
compensation. Under this system, the
owner/operator exercises control and
supervision over the driver. (Villamaria v. CA
and Bustamante, G.R. No. 165881)
The boundary-hulog contract between the
jeepney owner and the jeepney driver does not
negate the Er-Ee relationship between them.
(Azucena, 2016)
Labor Union and Unregistered Association
as Er
The mere fact that the respondent is a labor
union does not mean that it cannot be
considered an Er of the persons who work for
it. Much less should it be exempted from the
very labor laws which it espouses as labor
organization. (Bautista v. Inciong, G.R. No.
L-52824)
Application of the four-fold test and the
two-tiered test
Present Philippine law recognizes a two-tiered
test. The first tier of the test is the Four-fold
Test. The second tier is the Economics of the
Relationship Test. But the latter test is used if
and only if there is going to be harshness in the
results because of the strict application of the
four-fold test. (Francisco v. NLRC, G.R. No.
170087)
Art. 295 Presupposes Employment
Relationship
Art. 295 applies where the existence of Er-Ee
relationship is not the issue of the dispute. If
the issue is whether or not the claimant is an
employee, the tests of employment relationship
shall be resorted to. Art. 295 limits itself to
differentiating four kinds of employment
arrangement: regular, project, seasonal, and
casual. The article presupposes that
employment relationship exists between the
parties. (Azucena, 2016)
Employee vs Independent Contractor
Independent Contractor
Those who undertake “job-contracting.” They
exercise independent employment, contracting
to do a piece of work according to their own
methods and without being subject to control of
their Er except as to the result of their work.
(Villuga v. NLRC, G.R. No. 75038)
Note: Independent contractors often present
themselves to possess unique skills, expertise
or talent to distinguish them from ordinary Ees.
(Sonza v. ABS-CBN, G.R. No. 138051)
Indirect or Statutory Employer is one who
enters into a contract with an independent
contractor for the performance of any work,
task, job, or project not directly related to the
employer’s business. (Baguio v. NLRC, G.R.
Nos. 79004-08)
Note: No Er-Ee relationship exists between the
owner of the project and the Ees of the
independent contractor.
The principal employer is considered only an
indirect employer. (PCI Automation Center,
Inc. v. NLRC, G.R. No. 115920) What is
contracted is the performance and completion
of a designated job, and not just the supplying
of people to do the job.
Major Laws Applicable to Work
Relationship
1. Between the Principal and Contractor
– The Civil Code and pertinent
Commercial Laws
2. Between Contractor and his
Employees – the Labor Code and
Special Labor Laws.
Note: Between the principal and the
contractor’s Ees, no Er-Ee relationship exists;
the contractor, being himself a businessman, is
the Er. But the contractor may in turn become a
contractee if he contracts with a contractor.
28
Er-Ee relationship may be declared to exist XPNs:
between the principal and the contractor’s 1. Government employees;
workers where the contracting arrangement is 2. Field personnel;
not legitimate. 3. Managerial employees;
4. Officers and members of the managerial
Employee vs. Independent Contractor staff;
Employee Independent 5. Members of the family of the Er who are
Contractor dependent on him for support;
6. Workers paid by results;
As to their Existence 7. Persons in the personal service of
another; and
Existence of an Existence of an 8. Domestic helpers.
Er-Ee relationship is Independent
determined by law. Contractorship is The aforementioned employees are not entitled
determined by the to overtime pay, premium pay for rest days and
contract. holidays, night shift differential pay, holiday
pay, service incentive leave and service
As to the Exercise of Control charges. (Poquiz, 2012)
Er exercises the Only the result of their Government Employees
right to control not work is subject to the The terms and conditions of their employment
only the end Er’s control. are governed by the Civil Service Law.
achieved, but also
the manner and In case of government-owned or controlled
means used to corporations with original charters, terms and
achieve that end. conditions of employment may be governed by
such legislated charters.
As to Wages

Wages should Payment given to an Government-owned or controlled corporations

comply with the independent without original charters and created under the
minimum wage contractor is Corporation Code are governed by the Labor
established by law. compensation that is Code. (Poquiz, 2012)
agreed upon in the
contract. Managerial Employees
A managerial employee is one who is vested
As to Payment of Contributions with powers or prerogatives to lay down or
execute management policies and or to hire,
Er is required to The independent transfer, suspend, lay off, recall, discharge,
pay for Ee’s contractor pays for his assign or discipline employees, or to effectively
contributions, such own contribution. recommend such managerial actions. All
as Pag-IBIG, employees not falling within this definition are
PhilHealth, SSS. considered rank and file employees.
(PMTI-ULGWF v. Ferrer-Calleja, G.R. No.
As to Termination 85915)
1. Their primary duty consists of the
Ee may be Other valid grouds may management of the establishment in
terminated only be indicated in the which they are employed or of a
due to reasons contract. department or subdivision thereof.
stated in the LC. 2. They customarily and regularly direct
the work of two or more employees
therein.
Conditions of Employment 3. They have the authority to hire or fire
employees of lower rank; or their
a. Coverage suggestions and recommendations as to
GR: Title I, Book III of the Labor Code deals hiring and firing and as to the promotion
with hours of work, weekly rest periods, or any other change of status of other
holidays, service incentive leaves and service employees, are given particular weight.
charges. It covers all employees in all (Sec. 2(b), Rule I, Book III, IRR)
establishments, whether for profit or not. (Art.
82, LC) They are employed as such by virtue of their
special training or expertise, experience or
knowledge and for positions which require the
exercise of independent judgment and

29
discretion. They are not subject to the rigid of the managerial
observance of regular office hours, as the true staff.
worth of their services do not depend so much
on the time they spend in office, but more on Application
the results of their accomplishments. For these
types of workers, it is not feasible to provide Used only for Used only for
fixed hourly rate of pay or maximum hours of purposes of Book III purposes of Book V
labor. (UPSU v. Laguesma, G.R. No. 122226) (i.e., working (i.e., forming, joining
conditions, rest and assisting of
Officers or Members of Managerial Staff periods, and benefits) unions, certification
1. Their primary duty consists of the election, and,
performance of work directly related to collective bargaining)
management policies of their Er;
2. They customarily and regularly exercise Inclusion of Supervisors
discretion and independent judgment;
3. They regularly and directly assist a Supervisors are Supervisors are not
proprietor or a managerial employee members of the managerial
whose primary duty consists of the managerial staff. In employees under
management of the establishment in effect, supervisor is a Book V. (Azucena,
which he is employed or subdivision manager for 2016)
thereof; or execute under general purposes of Book III.
supervision work along specialized or
technical lines requiring special training, Domestic Servants/Persons in The Personal
experience, or knowledge; or execute, Service of Another
under general supervision, special These are those who:
assignments and tasks; and a. Perform such services in the Er's home
4. They do not devote more than 20% of which are usually necessary or
their hours worked in a work week to desirable for the maintenance and
activities which are not directly and enjoyment thereof; or
closely related to the performance of the b. Minister to the personal comfort,
work described above. (Sec. 2 (c), Rule convenience, or safety of the Er as well
I, Book III, IRR) as the members of his Er's household.
(Sec. 2(d), Rule I, Book III, IRR)
Officers and members of a managerial staff
(such as project engineers) are considered Note: They are not covered by this Title
managerial employees for they customarily and because terms and conditions of employment
regularly exercise discretion and independent are governed by the provisions of R.A. No.
judgment, that is, their powers are not subject 10361, otherwise known as the Batas
to evaluation, review and final action by the Kasambahay Law.
department heads and other higher executives
of the company. (Franklin Baker Co. of the A laundrywoman in staff houses of a company
Philippines v. Trajano, G.R. No. 75039) or within the premises of the business of the
employer, not actually serving the family of the
Test of Supervisory or Managerial Status employer, is a regular employee. She is not
Managerial Employees included in the definition of domestic servants.
(Apex Mining Co. Inc. v. NLRC, G.R. No.
Book III, Art. 82 Book V. Art. 219 (M) 94951)
Labor Standards Labor Relations
Field Personnel
Definition Field personnel refers to non-agricultural
employees who:
Refer to those whose Vested with the
primary duty consists powers or 1. Regularly perform their duties away
of the management prerogative to lay from the principal place of business or
of the establishment down and execute branch office of the Er; and
in which they are management 2. Whose actual hours of work in the field
employed or of a policies, and/or to cannot be determined with reasonable
department or hire, transfer, certainty. (Sec. 27, Rule II, Book III,
subdivision thereof, suspend, lay-off, IRR)
and to the other recall, discharge,
officers or members assign, or discipline They are exempted from the coverage due to
employees. the nature of their functions which requires

30
performance of service away from the principal
place of business. Hence, they are free from
the personal supervision of the Er and the
latter cannot determine with reasonable
certainty the actual number of hours of work
expended for the Er's interest.
The definition of a "field personnel" is not
merely concerned with the location where the
employee regularly performs his duties but also
with the fact that the employee’s performance
is unsupervised by the Er. In order to conclude
whether an employee is a field Ee, it is also
necessary to ascertain if actual hours of work
in the field can be determined with reasonable
certainty by the Er. In so doing, an inquiry must
be made as to whether or not the Ee’s time and
performance are constantly supervised by the
Er. (Autobus Transport Systems Inc. v.
Antonio Bautista, G.R. No. 156367)
Rule in case of Drivers/Bus Conductors
It is of judicial notice that along the routes that
are plied by these bus companies, there are its
inspectors assigned at strategic places who
board the bus and inspect the passengers, the
punched tickets, and the conductor's reports.
There is also the mandatory once-a-week car
barn or shop day, where the bus is regularly
checked as to its mechanical, electrical, and
hydraulic aspects, whether or not there are
problems thereon as reported by the driver
and/or conductor.
They too, must be at specific places at
specified times, as they generally observe
prompt departure and arrival from their point of
origin to their point of destination. In each and
every depot, there is always the dispatcher
whose function is precisely to see to it that the
bus and its crew leave the premises at specific
times and arrive at the estimated proper time.
He cannot be considered field personnel.
(Autobus Transport System, Inc. v. Bautista,
G.R No. 156367)
Members of the Family
They are exempted from the coverage, for the
support given by the Er may exceed the benefit
for which an employee is entitled under
appropriate labor provisions. To cover them
under Art. 82 may create labor problems that
would eventually break-up the family, which is
the evil sought to be prevented. (Poquiz, 2012)
Workers Paid by Results
There are two categories of employees paid by
results:
(1) Those whose time and performance are
supervised by the Er.
Note: Here, there is an element of
control and supervision over the manner
as to how the work is to be performed. A
piece-rate worker belongs to this
category especially if he performs his
work in the company premises.
(2) Those whose time and performance are
unsupervised.
Note: Here, the Er control is over the
result of the work. Workers on “pakyao”
and “takay” basis belong to this group.
(Lambo v. NLRC, G.R. No. 111042, 26
Oct. 1999)
Payment of this type of worker is
determined by the results of the work
performed or the number of units
produced, not the number of hours used
in the completion of the job or the time
spent in production. (Poquiz, 2012)
Tailors and similar workers hired in the
tailoring establishment, although paid
weekly wages on piece-work basis, are
employees and not independent
contractors, and accordingly, as regular
employees paid on piece-rate basis,
they are not entitled to overtime pay,
holiday pay, premium pay for
holiday/rest day and service incentive
leave pay. (Villaga v. NLRC, G.R. No.
75038)
An employee who is engaged on a task
or contract basis, purely commission
basis, or those paid by results, is not
automatically excluded by that fact
alone. To be excluded, the employee
must also fall under the classification of
field personnel.
b. Hours of Work
Principles in Determining Hours Worked
1. All hours are hours worked which the
employee is required to give to his
employer, regardless of whether or not such
hours are spent in productive labor or
involve physical or mental exertion.
2. An employee need not leave the premises
of the workplace in order that his rest period
shall not be counted, it being enough that
he stops working, may rest completely and
may leave his workplace.
3. If the work performed was necessary or it
benefited the employer, or the employee
could not abandon his work at the end of
his normal working hours because he had
no replacement, all time spent or such work
shall be considered as hours worked, if the
31
 work was with the knowledge of his
employer or immediate supervisor.
4. The time during which an employee is
inactive by reason of interruptions in his
work beyond his control shall be considered
working time either if:
a. The imminence of the resumption of
work requires the employee's
presence at the place of work; or
b. The interval is too brief to be utilized
effectively and gainfully in the
employee's own interest. (IRR of
Labor Code, Sec. 4, Book III, Rule
I)
1. Normal Hours of Work and Hours Worked
GR: The normal hours of work of any
employee shall not exceed eight (8) hours a
day. (Art. 83, LC)
Part-time work, or a day’s work of less than 8
hours, is not prohibited (Legend Hotel v.
Realuyo, G.R. No. 153511)
Note: There is no hard limit on the maximum
hours of work that may be rendered by an
employee. However, work rendered beyond the
eight-hour limit would not be considered
normal. It would be overtime, and thus subject
to additional pay to entitled employees.
XPN: Work Hours of Health Personnel -
include resident physicians, nurses,
nutritionists, dietitians, pharmacists, social
workers, laboratory, technicians, paramedical
technicians, psychologists, midwives,
attendants and all other hospital or clinic
personnel.
Hours Worked
Working time is one during which an employee
is actually working. It may include an instance
when an employee is not actually working but
he is required to be present in the Er’s
premises. Thus, the fact that he is required to
be present although not actually doing any
work, is still deemed working time. (Poquiz,
2012)
Hours Worked
Working time is one during which an employee
is actually working. It may include an instance
when an employee is not actually working but
he is required to be present in the Er’s
premises. Thus, the fact that he is required to
be present although not actually doing any
work, is still deemed working time. (Poquiz,
2012)
When Hours Worked are Compensable
1. Employee is required to be on duty or to
be at a prescribed workplace;
2. Employee is suffered or permitted to
work;
3. Rest periods of short duration during
working hours which shall not be more
than 20 minutes; and
4. Meal periods of less than 20 minutes.
(Sec. 7, Rule I, Book III, IRR)
2. Compressed Work Week
An alternative arrangement whereby the
normal workweek is reduced to less than six
(6) days but the total number of normal work
hours per week shall remain at 48 hours. The
normal workday is increased to more than
eight (8) hours without corresponding overtime
premium. (D.A. No. 02-04)
Resorted to by the employer to prevent serious
losses due to causes beyond his control (i.e.
when there is substantial slump in demand for
his goods and services or when there is lack of
raw materials).
Conditions for implementation of the
Compressed Work Week
a. The scheme is expressly and voluntarily
supported by majority of employees
affected;
b. In firms using substances, or operating
in conditions that are hazardous to
health, a certification is needed from an
accredited safety organization or the
firm’s safety committee that work
beyond eight (8) hours is within the
limits or levels of exposure set by
DOLE’s occupational safety and health
standards; and
c. The DOLE Regional Office is duly
notified.
3. Meal Periods
Every employer shall give his employees not
less than 60 minutes or one (1) hour time-off
for regular meals. (Art. 85, LC)
As a general rule, employees are entitled to at
least one hour time-off for regular meals which
can be taken inside or outside company
premises.
Non-Compensability of the Meal Period
For a full one-hour undisturbed lunch break,
the employees can freely and effectively use
this hour not only for eating, but also for their
rest and comfort which are conducive to more
efficiency and better performance in their work.
Since the employees are no longer required to
work during this one-hour lunch break, there is
no more need for them to be compensated for
32
this period. (Sime Darby Pilipinas, Inc. v.
NLRC, G.R. No. 119205)
Exceptions:
1. Where the lunch period or meal time is
predominantly spent for the employer’s
benefit;
2. Meal periods of 1hour are deemed
compensable when the employee is on
continuous shift
3. Shortened meal period of less than 1
hour must be compensable
Meal period of not less than 20 minutes in the
following cases are compensable hours
worked:
a. Where the work is non-manual work in
nature or does not involve strenuous
physical exertion;
b. Where the establishment regularly
operates not less than 16 hours a day;
c. 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
d. Where the work is necessary to prevent
serious loss of perishable goods (IRR
Labor Code, Book III, Rule 1, Sec. 7)
Note: These are the situations when meal
periods can be reduced to less than 1 hour but
not less than 20 minutes. As far as
compensability is concerned, as long as the
meal period is less than 1 hour, the period
becomes compensable.
Note: Rest periods or coffee breaks running
from 5-20 minutes shall be considered
compensable working time. (IRR Labor Code,
Book III, Rule 1, Sec. 7)
To shorten meal time to less than 20 minutes is
not allowed. If it is less than 20 minutes, it
becomes only a rest period and is considered
working time (Labor Code, Art. 84, Par. 2)
4. Night-Shift Differential
Every employee shall be paid a night shift
differential of not less than 10% of his regular
wage for each hour of work performed between
ten o’clock in the evening (10 pm) and six
o’clock in the morning (6 am). (Labor Code,
Art. 86).
GR: All employees are entitled to Night Shift
Differential (NSD).
XPNs:
1. Those of the government and any of its
political subdivisions, including
government-owned and/or controlled
corporations;
2. Those of retail and service
establishments regularly employing not
more than five (5) workers;
3. Domestic helpers and persons in the
personal service of another;
4. Managerial employees as defined in
Book Three of this Code;
5. Field personnel and other employees
whose time and performance is
unsupervised by the employer including
those who are engaged on task or
contract basis, purely commission basis,
or those who are paid a fixed amount for
performing work irrespective of the time
consumed in the performance thereof.
(IRR Labor Code, Book III, Rule II,
Sec. 1)
Computation:
NSD = (10% x regular wage/hr.) x no. of
hrs. of work between 10 pm – 6 am
Night Differential in Overtime Pay
If work done between 10PM and 6AM is
overtime work, then the ten percent (10%)
NSD should be based on the overtime rate.
5. Overtime Work
Overtime work is the service rendered in
excess of and in addition to eight hours on
ordinary working days. (Caltex Regular
Employees at Manila Office v. Caltex
Philippines, G.R. No. 111359)
Overtime pay is the additional compensation
of at least 25% on the regular wage for the
service or work rendered or performed in
excess of eight (8) hours a day by employees
or laborers in employment covered by the
Eight-hour Labor Law. (Art. 87, LC)
Overtime pay is based on regular base pay
excluding money received by employees in
different concepts such as Christmas bonus
and other fringe benefits.
NOTE: Express instruction from the employer
to the employee to render OT work is not
required for the employee to be entitled to OT
pay; it is sufficient that the employee is
permitted or suffered to work. (Azucena, 2016)
However, written authority after office hours
during rest days and holidays are required for
entitlement to compensation.
33
6. Overtime Pay Rates
SCENARIO RATE
On a regular day Regular wage + at
least
25% thereof
On a holiday/special Rest day or special
day/ employees holiday wage rate
rest day (130%) + 30%
thereof.
On a holiday which Rest day & holiday
falls on a rest day wage rate (150%) +
30% thereof.
Note: Since OT work is considered hourly, the
pay rate is computed on a per hour basis. The
daily wage is divided by 8 to get the hourly
base rate.
c. Rest Periods
Every employer shall give his employees a rest
period of not less than 24 consecutive hours
after every six (6) consecutive normal
work-days. (Sec. 3, Rule III, Book III, IRR)
It applies to all employers whether operating
for profit or not, including public utilities
operated by private persons.
Rest day not necessarily Sunday or Holiday
All establishments and enterprises may
operate or open for business on Sundays and
holidays provided that the employees are given
the weekly rest day and the benefits provided
under the law. (Sec. 2, Rule III, Book III, IRR)
Emergency Rest Day Work
GR: The employee cannot be compelled by the
employer to work on his rest day.
XPNs:
1. In case of Urgent work to be performed
on machineries, equipment or
installations to avoid serious loss which
the employer would otherwise suffer.
2. 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
3. In the event of Abnormal pressure of
work due to special circumstances,
where the employer cannot ordinarily be
expected to resort to other measures
4. To prevent serious loss of perishable
goods
5. Where the Nature of the work is such
that the employees have to work
continuously for 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
6. Under other Analogous or similar
circumstances
7. Where the nature of work requires
continuous operations and the stoppage
of work may result in irreparable injury
or loss to the employer
Other than the above circumstances, no
employee shall be required against his will to
work on his scheduled rest day.
When an employee volunteers to work on his
rest day under other circumstances, he shall
express such desire in writing, subject to
payment of additional compensation.
An employee shall be entitled additional
compensation for work performed on a Sunday
only when it is his established rest day.
The failure to work during an employer’s rest
day does not justify the disciplinary sanction of
outright dismissal from employment as such is
so severe a consequence, more so when
justifiable grounds exist for said failure
(Remerco Garments Manufactuing v.
Minister of Labor, G.R. No. L-56176-77)
d. Holidays
Holiday pay refers to the payment of the
regular daily wage for any unworked regular
holiday.
It is a premium given to employees pursuant to
the law even if he has not suffered to work on a
regular holiday. It is limited to the 12 regular
holidays, also called legal holidays listed by
law. The employee should not have been
absent without pay on the working day
proceeding the regular holiday.
Persons entitled to Holiday Pay
GR: All employees are entitled to Holiday Pay.
(Sec. 1, Rule IV, Book III, IRR)
XPNs:
1. Government employees and any of its
political subdivisions, including GOCCs
(with original charter);
2. Retail and service establishments
regularly employing less than ten (10)
workers;
3. Domestic helpers and persons in the
personal service of another;
4. Employee engaged on task or contract
basis or purely commission basis;
5. Members of the family of the Er who are
dependent on him for support;
6. Managerial Employees and other
members of the managerial staff;
34
 7. Field personnel and other employees
whose time and performance are
unsupervised by the employer; and
8. Employees paid Fixed amount for
performing work irrespective of the time
consumed in the performance thereof.
1. Amun Jadid (New Year)
2. Maulid un-Nabi (Birthday of the Prophet
Muhammad)
3. Lailatul Isra Wal Miraj (Nocturnal
Journey and the Ascencion of the
Prophet Muhammad)

Legal Holiday XPN: Eid al Fit’r and Eid ul Adha (Celebrated

It is a day designated or set apart by the nationwide)
legislature, for a purpose within the meaning of
the term "holiday" to commemorate an Note: Muslim holidays shall be officially
important event. observed in the Provinces of Basilan, Lanao
del Norte, Lanao del Sur, Maguindanao, North
Regular Holidays Cotabato, Sultan Kudarat, Sulu, Tawi-Tawi,
GR: They are compensable whether worked or Zamboanga del Norte and Zamboanga del Sur,
unworked subject to certain conditions. They and in the Cities of Cotabato, Iligan, Marawi,
are also called legal holidays. Pagadian, and Zamboanga and in such other
Muslim provinces and cities as may hereafter
XPN: A legal holiday falling on a Sunday be created. Upon proclamation by the
creates no legal obligation for the Er to pay President of the Philippines, Muslim holidays
extra, aside from the usual holiday pay, to its may also be officially observed in other
monthly-paid employees. (Wellington provinces and cities.
Investment and Manufacturing Corporation
v. Trajano et al., G.R. No. 114698) Muslim employees working outside of the
specified areas shall be excused from reporting
HOLIDAY DATE for work during the observance of the Muslim
REGULAR HOLIDAYS holidays as recognized by law, without
New Year’s Day January 1 diminution of salary or wages during the
Araw ng Kagitingan April 9 period.
Maundy Thursday Movable date
Good Friday Movable date Considering that all private corporations,
Labor Day May 1 offices, agencies, and entities or
Independence Day June 12 establishments operating within the designated
Muslim provinces and cities are required to
National Heroes Last Monday of
observe Muslim holidays, both Muslims and
Day August
Christians working within the Muslim areas
Eid’l Fitr Movable date
may not report for work on the days designated
Eid’l Adha Movable date by law as Muslim Holidays. (SMC v. CA, G.R.
Bonifacio Day November 30 No. 146775).
Christmas Day December 25
Rizal Day December 30 Regular Holiday vs. Special Holiday
SPECIAL (NON-WORKING) HOLIDAYS REGULAR SPECIAL HOLIDAY
Ninoy Aquino Day August 21 HOLIDAY
All Saints Day November 1 If unworked
Feast of Immaculate December 8 Compensable,subje
Conception of Mary ct Not compensable
(R.A. No. 10966) to certain conditions
Last day of the year December 31 If worked
Other holidays declared by law and Rate is 200% of the Additional 30%
ordinance regular rate premium pay of 100%
RW
Note: Regular Holiday falling within temporary Limited to the 12 Not exclusive; law or
or periodic shutdown and temporary cessation holidays provided in ordinance may
of work are compensable. However, if the the Labor Code provide for other
temporary or periodic shutdown and cessation special holidays
of work is due to business reverses, the
employer may not pay the employees during Outline of Rules on Payment of Holiday Pay
such period. REGULAR HOLIDAYS
Falling on a regular work day
Muslim Holidays Unworked 100% (EXCEPT: in retail and
GR: Muslim holidays are observed only in service establishments
specified areas.

35
 employing less than 10 Service Charge vs. Tips
workers) SERVICE TIPS
First 8 200% CHARGE
Hours Collected by the Voluntary payments
Worked Excess of + 30% of management from made by the
8 hourly rate the customers. customers to the Ees
Hours on said da for excellent service.
Falling on a rest day
Unworked 100% Tips
First 8 + 30% of 200% Tips are handled similarly as service charges.
hours Pooled tips should be monitored, accounted,
Worked and distributed in the same manner as the
Excess of + 30% of hourly
8 hours rate on said day service charges.
SPECIAL DAYS
NO PAY, unless there is a A waiter must drop in a tip box the tips he
favorable company policy, received. Otherwise, he commits “tip
Unworked practice or CBA granting pocketing”, a serious offense of dishonesty that
payment of wages on special may cost him his job.
days even if unworked
First 8 + 30% of the f. Occupational Safety and Health
hours daily rate Standards Law (RA 11058)
Worked (100%) This Act shall apply to all establishments,
Excess of + 30% of hourly projects, sites, including Philippine Economic
8 hours rate on said day Zone Authority (PEZA) establishments, and all
Worked & First 8 +50% of daily other places where work is being undertaken in
Falling On hours rate all branches of economic activity, except in the
A Rest Day Excess of +30% of hourly public sector.
8 hours rate
SPECIAL WORKING HOLIDAYS – only 1. Covered Workplaces
the basic rate Refer to establishments, projects, sites and all
other places where work is being undertaken
e. Service Charge [Article 96 of the Labor wherein the number of employees, nature of
Code, as amended by RA 11360] operations, and risk or hazard involved in the
business, as determined by the Secretary of
All service charges collected by hotels, Labor and Employment, require compliance
restaurants and similar establishments shall be with the provisions of this Act. (Section 3(c),
distributed completely and equally among the RA 11058)
covered employees except managerial
employees. (Labor Code, Art. 96, as 2. Duties of Employers Workers and Other
amended by RA 11360) Persons
a. Every employer, contractor or
The basis of the amount to be integrated shall subcontractor, if any, and any person who
be the average monthly share of each manages, controls or supervises the work
employee for the past 12 months immediately being undertaken shall:
preceding the abolition of withdrawal of the 1. Farnish the workers a place of
charges. (IRR Labor Code, Sec. 5, Rule VI, employment free from hazardous
Book 3) conditions that are causing or are likely
to cause death, illness or physical harm
Covered Employees to the workers;
GR: All employees are covered, regardless of 2. Give complete job safety instructions or
their position, designation, and employment
orientation to all the workers especially
status, irrespective of the method by which
to those entering the job for the first
their wages are paid.
time, including those relating to
Note: Applies only to hotels, restaurants and familiarization with their work
similar establishments collecting service environment;
charges. 3. Inform the workers of the hazards
associated with their work, health risks
XPN: Managerial Employees (Sec. 2, Rule IV, involved or to which they are exposed to
Book III, IRR) preventive measures to eliminate or

36
 minimize the risks, and steps to be
taken in cases of emergency
4. Use only approved devices and
equipment for the workplace.
5. Comply with OSH standards including
training, medical examination and,
where necessary, provision of protective
and safety devices such as personal
protective equipment (PPE) and
machine guards.
6. Allow workers and their safety and
health representatives to participate
actively in the process of organizing
planning, implementing and evaluating
the safety and health program to
improve safety and health in the
workplace and
7. Provide, where necessary, for measures
to deal with emergencies and accidents
including first-aid arrangements.
b. Every worker shall participate in ensuring
compliance with OSH standards in the
workplace. The worker shall make proper
use of all safeguards and safety devices
furnished for the worker's protection and
that of others, and shall observe
instructions to prevent accidents or
imminent danger situations in the
workplace. The worker shall oferve the
prescribed steps to be taken in cases of
emergency.
The worker shall report to the supervisor
any work hazard that may be discovered in
the workplace.
c. It shall be the duty of any person, including
the builder or contractor who visits, builds,
renovates or installs devices or conducts
business in any establishment or
workplace, to comply with the provisions of
this Act and all other regulations issued by
the Secretary of Labor and Employment.
d. Whenever two (2) or more undertakings are
engaged in activities simultaneously in one
(1) workplace, it shall be the duty of all
engaged to collaborate in the application of
OSH standards and regulations. (Section 4,
RA 11058)
3. Workers’ Right to Know
The right to safety and health at work shall be
guaranteed. All workers shall be appropriately
informed by the employer about all types of
hazards in the workplace, provided access to
training and education on chemical safety, and
to orientation on the data sheet of chemical
safety, electrical safety, mechanical safety, and
ergonomic safety. (Section 5, RA 11058)
4. Workers' Right to Refuse Unsafe Work
The worker has the right of refusal to work
without threat or reprisal from the employer if,
as determined by the DOLE, an imminent
danger situation exists in the workplace that
may result in illness. injury or death, and
corrective actions to eliminate the danger have
not been undertaken by the employer.
(Section 6, RA 11058)
5. Workers' Right to Personal Protective
Equipment (PPE)
Every employer, contractor or subcontractor, if
any, shall provide his workers, free of charge,
protective equipment for their eyes, face,
hands and feet, and lifeline, safety belt or
harness, gas or dust respirators or masks, and
protective shields whenever necessary by
reason of the hazardous work process or
environment, chemical, radiological,
mechanical and other irritants or hazards
capable of causing injury or impairment in the
function of any part of the body through
absorption, inhalation or physical contact. The
cost of the PPE shall be part. of the safety and
health program which is a separate pay item
pursuant to Section 20 of this Act.
All PPE shall be of the appropriate type as
tested and approved by the DOLE based on its
standards. The usage of PPE in all
establishments, projects, sites and all other
places where work is being undertaken shall
be based on the evaluation and
recommendation of the safety officer. (Section
8, RA 11058)
Wages
Wages paid to any employee shall mean the:
1. Remuneration or earnings, however
designated, 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, 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;
2. Includes, the fair and reasonable value,
as determined by the DOLE Secretary,
of board, lodging, or other facilities
customarily furnished by the employer to
the employee. (Art. 97, Labor Code )
37
"Fair and reasonable value" shall not include
any profit to the employer, or to any person
affiliated with the employer.
a. Definitions
1. Wage vs. Salary
deduction is authorized in writing by the
employees.
The remaining 30% of the value has to be
subsidized by the employer. (IRR Labor Code,
Sec. 1, Rule VII-A, Book III)

WAGE SALARY Supplements

Paid for skilled or Paid to white collar The benefit or privilege given to the employee
unskilled manual workers and denote which constitutes an extra remuneration over
labor a higher grade of and above his basic or ordinary earning or
employment. wage, is supplement. Thus, free meals
Not subject to Not exempt from supplied by the ship operator to crew
execution, execution, members, out of necessity, cannot be
garnishment or garnishment or considered as facilities but supplements which
attachment except attachment. could not be reduced having been given not as
for debts related to part of wages but as a necessary matter in the
necessities (Civil maintenance of the health and efficiency of the
Code, Art. 1708) crew personnel during the voyage. (States
Marine Corporation and Royal Line, Inc. v.
Minimum wage is set by law or wage order Cebu Seamen’s Association, Inc., G.R. No.
issued by the Regional Tripartite Wages and L-12444).
Productivity Boards (RTWPB’s) or the rate
which may be fixed by the employer provided FACILITIES FACILITIES
the same is not lower than the legally What it is
mandated minimum wage for agricultural or Necessary items of Extra remuneration or
non-agricultural workers. expense, articles, or special privileges/
services benefits/ articles or
Wage or Salary includes: services / tools of the
1. Commission trade
2. Facilities Who Benefits
3. Commodities/ Supplements For the benefit of For the benefit or
the employee and convenience of the
2. Facilities vs. Supplements his family; for their employer
Facilities existence and
Articles or services for the benefit of the subsistence
employee or his family but shall not include Deductibility from wage
tools of the trade or articles or; may be Part of the wage Independent of the
deducted from the employees’ wages. wage
Deductible from the Not wage deductible
Acceptance of Facilities wage
In order that the cost of facilities furnished by
the employer may be charged against an b. Principles
employee, the employee’s acceptance of such 1. “No Work, No Pay” Principle (Fair Day’s
facilities must be voluntary. Wage for a Fair Day’s Labor)

Requirements for deducting value of GR: If there is no work performed by the

facilities:
1. Proof must be shown that such facilities
are customarily furnished by the trade;
2. The provision of deductible facilities
must be voluntarily accepted in writing
by the employee;
3. The facilities must be charged at fair
and reasonable value. (SLL
International Cable Specialists v.
NLRC, G.R. No. 172161).
Note: 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
employee, without the fault of the Er, there can
be no wage or pay. Burden of economic loss
suffered by employees shall not be shifted to
the Employer
XPNs: When the laborer was able, willing and
ready to work but was:
1. Prevented by management;
2. Illegally locked out;
3. Illegally suspended;
4. Illegally dismissed; and
5. Illegally prevented from working.
2. “Equal Pay for Equal Work” Principle

38
Persons who work with substantially equal
qualifications, skill, effort and responsibility,
under similar conditions, should be paid similar
salaries. Employees holding the same position
and rank are presumed to be performing equal
work. The rule of equal pay for equal work
applies whether the employee is hired locally
or abroad. (International School Alliance of
Educators v. Quisumbing, G.R. No. 128845)
Coverage/Exclusion
GR: The rule on wages applies to ALL
workers. (SLL International Cables, G.R. No.
172161, 2011).
XPNs:
1. Farm tenancy / leasehold
2. Domestic service
3. Persons working in their respective
homes in needle work or in any Cottage
industry duly registered in accordance
with law
4. Barangay micro business enterprise
(BMBE) under RA 9178, the BMBE Law.
BMBE – 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 P3M.
5. Cooperatives. (Benguet Electric
Cooperative v. Hon. Ferrer-Calleja,
G.R. No. 79025).
6. Homeworkers employed in any
establishment duly registered with the
National Cottage Industries and
Development Authority in accordance
with RA 8470
7. Retail and service establishments
regularly employing not more than 10
workers.
3. 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."
If there is no work performed by the employee
there can be no wage or pay, unless of course,
the laborer was able, willing and ready to work
but was illegally locked out, dismissed or
suspended. It is hardly fair or just for an
employee or laborer to fight or litigate against
his employer on the employer's time.
4. Non-Diminution of Benefits
Non-Diminution Rule
GR: Nothing in the Labor Code shall be
construed to eliminate or in any way diminish
supplements, or other employee benefits being
enjoyed at the time of the promulgation of the
Code. (Art. 100, LC)
Benefits being given to employees cannot be
taken back or reduced unilaterally by the
employer because the benefit has become part
of the employment contract, whether written or
unwritten.
XPNs:
1. Correction of error;
2. Contingent benefit or conditional bonus;
3. Wage order compliance;
4. Benefits on reimbursement basis;
5. Reclassification of position;
6. Negotiated benefits
Note: Benefits initiated through
negotiation between employer and
employees, such as those contained in
a CBA are not within the prohibition of
Art. 100 because, as products of
bilateral contract, they can only be
eliminated or diminished bilaterally.
(Azucena, 2016)
7. Productivity incentives
Note: If the error is not corrected in a
reasonable time, it ripens into a
company policy and employees can
demand it as a matter of right.
When Non-Diminution Rule Applicable
The rule is applicable if it is shown that:
1. The practice is consistent and deliberate
2. The diminution or discontinuance is
done unilaterally by the employer
3. The grant of the benefit is founded on a
policy or has ripened into a practice over
a long period
4. The practice is not due to error in the
construction or application of a doubtful
or difficult question of law
When not applicable
1. At least one of the requisites is absent
2. Mistake in the application of the law
3. Negotiated benefits
4. Reclassification of Positions – e.g., loss
of some benefits by promotion.
5. Contingent or Conditional Benefits – the
rule does not apply to a benefit whose
grant depends on the existence of
certain conditions, so that the benefit is
39
 not demandable if those preconditions
are absent.
c. Payment of Wages
Forms of Payment
GR: As a general rule, wages shall be paid in
legal tender. (Sec. 1, Rule VIII, Book III, IRR
of LC)
No employer shall pay the wages of an
employee by means of:
1. Promissory notes;
2. Vouchers;
3. Coupons;
4. Tokens;
5. Tickets;
6. Chits; or
7. Any object other than legal tender.
Note: This prohibition applies even when
expressly requested by the employee.
XPNs: Payment of wages by bank checks,
postal checks or money orders is allowed
where:
1. It is customary on the date of the
effectivity of the Code;
2. Necessary because of special
circumstances as specified in the
regulation issued by the SOLE;
3. Stipulated in the CBA; or
4. Where the following conditions are met:
a. There is a bank or other facility
for encashment within a radius of
one (1) kilometer 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; and
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. (Sec. 2, Rule VIII, Book
III, IRR of LC)
Time of Payment
GR: At least once every 2 weeks or twice a
month at intervals not exceeding 16 days.
XPNs:
1. In case of force majeure or other
circumstances beyond the employer’s
control, payment must be made
immediately after such occurrence has
ceased; and
2. In case of payment of wages by result
involving work which cannot be
completed in two weeks and in the
absence of CBA or arbitration award:
- Payments are made at intervals
not exceeding 16 days, in
proportion to the amount of work
completed; and
- Final settlement is made upon
completion of the work. (IRR
Labor Code, Sec. 3, Rule VIII,
Book III)
In all cases: No employer shall make payment
with less frequency than once a month.
If on account of force majeure or
circumstances beyond the employer’s control,
payment of wages on or within the time herein
provided cannot be made, the employer shall
pay the wages immediately after such force
majeure or circumstances have ceased.
Place of Payment
GR: Payment of wages shall be made at or
near the place of undertaking.
XPNs: Payment in a place other than the work
place shall be permissible only under the
following circumstances:
1. When payment cannot be effected at or
near the place of work by reason of the
deterioration of peace and order
conditions, or by reason of actual or
impending emergencies caused by fire,
flood, epidemic or other calamity
rendering payment thereat impossible
2. When the employer provides free
transportation to the employees back
and forth
3. Under any other analogous
circumstances; Provided, That the time
spent by the employees in collecting
their wages shall be considered as
compensable hours worked (Labor
Code, Art. 103; IRR Labor Code, Sec.
4, Rule VIII, Book III)
Prohibited Place of Payment
GR: Payment cannot be made in a 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
40
XPN: Persons employed in the
abovementioned places may be paid there
(IRR Labor Code, Sec. 4[b], Rule VIII, Book
III)
Requisites of Payment Through Banks
1. Shall be made upon written permission
of the majority of the employees or
workers concerned;
2. With 25 or more employees; and,
3. Located within one (1) kilometer radius
to a commercial, savings or rural bank.
(Sec. 7, R.A. No. 6727)
Requisites of Payment Through Automated
Teller Machine (ATM)
1. The ATM system of payment is with the
written Consent of the employees
concerned;
2. The employees are given reasonable
Time to withdraw their wages from the
bank facility which time, if done during
working hours, shall be considered
compensable hours worked;
3. The system shall Allow workers to
receive their wages within the period or
frequency and in the amount prescribed
under the Labor Code;
4. There is a bank or ATM facility within a
Radius of one (1) kilometer to the place
of work;
5. Upon request of the concerned
employee/s, the employer shall issue a
Record of payment of wages, benefits
and deductions for a particular period;
6. There shall be no additional expenses
and no Diminution of benefits and
privileges as a result of the ATM system
of payment;
7. The employer shall assume
Responsibility in case the wage
protection provisions of law and
regulations are not complied with under
the arrangement
Direct Payment of Wages
GR: Wages shall be paid directly to the
workers to whom they are due. (Art. 105, LC)
XPNs:
1. Payment through another person may
be made in cases of force majeure
which renders the payment impossible,
provided that such person is under
written authority given by the worker for
the purpose;
2. Where the employer is authorized in
writing by the employee to pay his
wages to a member of his family;
3. Where payment to another person of
any part of the employee's wages is
authorized by existing law, including
payments for the insurance premiums of
the employee and union dues where the
right to check-off has been recognized
by the Er in accordance with a collective
agreement or authorized in writing by
the individual employees concerned; or
4. In case of death of the employee, the Er
may pay the wages to the heirs without
the necessity of intestate proceedings.
When the heirs are of age, they shall:
a. Execute an affidavit attesting to
their relationship to the deceased
and the fact that they are his
heirs to the exclusion of all other
persons;
b. In case any of the heirs is a
minor, such affidavit shall be
executed in his behalf by his
natural guardian or next of kin;
c. Upon presentation of the affidavit
to the Er, he shall make payment
to the heirs as representative of
the SOLE. (Sec. 6, Rule VIII,
Book III, IRR of LC)
d. Prohibitions Regarding Wages
1. Non-Interference in Disposal of Wages
Employers shall not limit or interfere with the
freedom of any employee to dispose of his
wages. He shall not force, compel or oblige his
employees to purchase merchandise,
commodities or other property from any other
person, or otherwise make use of any store
services of such Er or any other person. (Art.
112, LC)
Civil Code Provisions on Non-Interference
in Disposal of Wages
1. The laborer’s wages shall be paid in
legal currency (Civil Code, Art. 1705)
2. Withholding of wages, except for a debt
due, shall not be made by the employer
(Civil Code, Art. 1706)
3. The laborer’s wages shall be a lien on
the goods manufactured or the work
done (Civil Code, Art. 1707)
4. The laborer’s wages shall not be subject
to execution or attachment, except for
debts incurred for food, shelter, clothing,
and medical attendance (Civil Code,
Art. 1708)
5. The employer shall neither seize nor
retain any tool or other articles
belonging to the laborer (Civil Code,
Art. 1709)
2. Wage Deduction
GR: No employer, in his own behalf or on
behalf of any person, shall make any deduction
from the wages of his employees. (Art. 113,
LC)
41
XPNs:
1. With Employee’s Consent in Writing
- Value of meals and other facilities
- Payments to third persons with
employee’s consent and without
pecuniary benefit
- Deduction for unpaid absences
2. Without Employee’s Consent
- Worker’s insurance acquired by
the employer
- Union dues, where the right to
check-off has been recognized by
the employer or authorized in
writing by the employee
- Cases where the employer is
authorized by law or regulations
issued by the Secretary of Labor
- Debts of the employee to the
employer that have become due
and demandable Withholding tax.
NOTE: Persons earning
minimum wage are exempted
from income tax.
3. When Authorized by Law
- Deposit for loss/breakage (Labor
Advisory, No. 11 [2014], Sec. 3)
- In cases where the employee is
indebted to the employer, where
such indebtedness has become
due and demandable (Civil
Code, Art. 1706)
- Court judgment, but only for
debts incurred for food, shelter,
clothing, and medical attendance
(Civil Code, Art. 1708)
SSS, PHILHEALTH, PAG-IBIG
Fund payments are authorized
deductions.
4. Regulation Issued by the Secretary of
Labor
3. Prohibition against Deposit Requirement
GR: While deductions from the employees’
wages may be made for cash bonds or
deposits, the employer, however, is not allowed
to unilaterally impose upon its employees the
giving of cash bonds or deposits.
XPN: If the employer proved and established
that it falls under any of the following:
a. That it is engaged in such trades,
occupations or business were the
practice of making deductions or
requiring deposits is a recognized one;
or
b. That the cash bond or deposit is
necessary or desirable as determined
by the DOLE Secretary in appropriate
rules and regulations.
In the case of Nina Jewelry v. Montecillo
(G.R. No. 188169), the court ruled that the
petitioners should first establish that the
making of deductions from the salaries is
authorized by law, or regulations issued by the
SOLE. Further, the posting of cash bonds
should be proven as a recognized practice in
the jewelry manufacturing business, or
alternatively, the petitioners should seek for the
determination by the SOLE through the
issuance of appropriate rules and regulations
that the policy the former seeks to implement is
necessary or desirable in the conduct of
business.
4. Prohibition on withholding of wages
It shall be unlawful for any person, directly or
indirectly, to withhold any amount from the
wages of a worker. (Art. 116, LC)
Although management prerogative refers to the
right to regulate all aspects of employment, it
cannot be understood to include the right to
temporarily withhold salary/wages without the
consent of the employer. To sanction such an
interpretation would be contrary to Art. 166 of
the Labor Code. (SHS Perforated Materials,
Inc. v. Diaz, G.R. No. 185814)
As an exception, employers usually withhold
the release of the last salary and benefits of
terminated or resigning employees prior to or
pending their compliance with certain
clearance procedures.
Clearance procedures are instituted to ensure
that the properties, real or personal, belonging
to the employer but are in the possession of
the separated employee, are returned to the Er
before the employee’s departure. (Milan v.
NLRC and Solid Mills, Inc., G.R. No. 202961)
5. Other Prohibitions
a. Inducing a worker to give up any part of
his wages by force, stealth, intimidation,
threat or by any other means
whatsoever without his consent. (Art.
116, LC)
b. To make deductions from wages for the
benefit of the Er or his representative as
consideration of a promise of
Employment or retention in employment;
(Art. 117, LC)
c. Refusal by Er to pay or reduce wages or
benefits in discrimination of any Ee who
has filed any complaint or instituted any
proceedings under the code or has
testified or about to testify; (Art. 118,
LC) or
42
 d. Unlawful for any person to make any
statement, report, or record filed or kept
pursuant to the Code knowing such
statement, report or record to be false in
any material aspect. (Art. 119, LC)
e. Wage Distortion
1. Concept
A situation where an increase in prescribed
wage 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. (Art. 124, LC)
It is the disappearance or virtual
disappearance of pay differentials between
lower and higher positions in an enterprise
because of compliance with a wage order. (P.I.
Manufacturing v. P.I. Manufacturing
Supervisors and Foreman, G.R. No. 167217)
Note: Wage distortion presupposes an
increase in the compensation of the lower pay
class in an office hierarchy without a
corresponding raise for high level employees in
the same region of the country, resulting in the
elimination or severe diminution of the
distinction between the two groups or classes.
(Prubankers Association v. Prudential Bank
& Trust Company, G.R. No. 131247)
Elements of Wage Distortion
1. An existing hierarchy of positions with
corresponding salary rates;
2. A significant change or increase in the
salary rate of a lower pay class without
a corresponding increase in the salary
rate of a higher one;
3. The elimination of the distinction
between the two (2) groups or classes;
and
4. The WD exists in the same region of the
country. (Alliance Trade Unions v.
NLRC, G.R. No. 140689)
In mandating an adjustment, the law did not
require that there be an elimination or total
abrogation of quantitative wage or salary
differences; a severe contraction is enough.
(Metrobank v. NLRC, G.R. No. 102636)
Wage distortion does not arise when a wage
order gives employees in one branch of a bank
higher compensation than that given to their
counterparts in other regions occupying the
same pay scale who are not covered by said
wage order. In short, the implementation of
wage orders in one region but not in others
does not in itself necessarily result in wage
distortion. (Prubankers Association v.
Prudential Bank & Trust Company, G.R. No.
131247)
Wage distortion is applied to voluntary and
unilateral increases by the employer in fixing
hiring rates which is inherently a business
judgment prerogative, then the hands of the
employer would be completely tied even in
cases where an increase in wage of a
particular group is justified due to a
re-evaluation of the high productivity of a
particular group, or as in the present case, the
need to increase the competitiveness of
Bankard’s hiring rate. An employer would be
discouraged from adjusting the salary rates of
a particular group of employees for fear that it
would result to a demand by all employees for
a similar increase, especially if the financial
conditions of the business cannot address an
across-the-board increase. (Bankard
Employees Union-Workers Alliance Trade
Unions v. NLRC, G.R. No. 140689)
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 it 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)
Amount of Distortion Adjustment
The restoration of the previous pay advantage
is the aim but not necessarily to the last peso.
Restoration of appreciable differential, a
significant pay gap, should suffice as
correction.
43
f. Minimum Wage Law
Regional Minimum Wage
Regional minimum wage refers to the lowest
basic wage rates than an employer can pay for
his works, as fixed by the Regional Tripartite
Wages and Productivity Boards (RTWBPs),
and which shall not be lower than the
applicable statutory minimum wage rates.
(Sec. 4 (k), Rule 1, NWPC Guidelines No. 01,
Series of 2007, 19 June 2007)
Statutory Minimum Wage
Statutory minimum wage is the lowest wage
rate fixed by law that an employer can pay his
workers. (IRR, R.A. No. 6727) Compensation
which is less than such minimum rate is
considered an underpayment that violates the
law. (Azucena, 2016)
Minimum Wage Non-Negotiable; Non-
Waivable
The minimum wage fixed by law is mandatory;
thus, it is non-waivable and non-negotiable.
The enactment is compulsory in nature in order
to ensure decent living conditions. (PAM Co. v.
PAMEA-FFW, G.R. No. L-35254)
XPNs to the Coverage of Minimum Wage
1. Household or domestic helpers,
including family drivers and persons in
the personal service of another;
Note: Household or domestic workers
are only exempt from the minimum
wage prescribed by wage orders. RA
10361 otherwise known as “Batas
Kasambahay” prescribes the minimum
wage for household or domestic
helpers.
2. Homeworkers engaged in needle-work;
3. Workers employed in any establishment
duly registered with the National
Cottage Industries and Development
Authority 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 SOLE;
5. Employees of retail and service
establishments regularly employing not
more than ten employees;
6. Workers in a duly registered cooperative
when so recommended by the Bureau
of Cooperative Development and upon
approval of the SOLE;
7. Workers of a barangay micro business
enterprise.
Note: Retail and service establishments
must file an application for exemption
with the duly appropriate Regional
Board.
Additional Exemptions
The NWPC Guidelines on Exemption from
wage orders adds categories of exemptible
enterprises such as distressed establishments,
new business enterprises, and establishments
adversely affected by natural calamities.
Wage Orders issued by the wage boards under
Arts. 99 and 122 may provide for other
exemptions from the Minimum Wage Law.
(Azucena, 2016)
g. Holiday Pay
Persons entitled to Holiday Pay
GR: All employees are entitled to Holiday Pay.
(Sec. 1, Rule IV, Book III, IRR)
XPNs:
1. Government employees and any of its
political subdivisions, including GOCCs
(with original charter);
2. Retail and service establishments
regularly employing less than ten (10)
workers;
3. Domestic helpers and persons in the
personal service of another;
4. Employee engaged on task or contract
basis or purely commission basis;
5. Members of the family of the Er who are
dependent on him for support;
6. Managerial Employees and other
members of the managerial staff;
7. Field personnel and other employees
whose time and performance are
unsupervised by the employer; and
8. Employees paid Fixed amount for
performing work irrespective of the time
consumed in the performance thereof.
Legal Holiday
It is a day designated or set apart by the
legislature, for a purpose within the meaning of
the term "holiday" to commemorate an
important event.
Regular Holidays
GR: They are compensable whether worked or
unworked subject to certain conditions. They
are also called legal holidays.
XPN: A legal holiday falling on a Sunday
creates no legal obligation for the Er to pay
extra, aside from the usual holiday pay, to its
monthly-paid employees. (Wellington
Investment and Manufacturing Corporation
v. Trajano et al., G.R. No. 114698)
44
Regular Holiday vs. Special Holiday Formula and Computation of 13th Month
REGULAR SPECIAL HOLIDAY Pay
HOLIDAY Total basic salary
If unworked earned during the year = 13th month pay
Compensable,subje 12
ct Not compensable
to certain conditions Time of payment of 13th month pay
If worked Under PD 851, all Ers are required to pay all
Rate is 200% of the Additional 30% their rank-and-file employees a 13th month pay
regular rate premium pay of 100% not later than Dec. 24 of every year.
RW
Limited to the 12 Not exclusive; law or Absence of CBA provision not a bar in
holidays provided in ordinance may giving 13th month pay
the Labor Code provide for other
The absence of an express provision in the
special holidays
CBA obligating the employer to pay the
members of a union 13th month pay is
Outline of Rules on Payment of Holiday Pay immaterial. Notwithstanding the absence of
REGULAR HOLIDAYS any contractual agreement, the payment of a
Falling on a regular work day 13th month pay, being a statutory grant, is
Unworked 100% (EXCEPT: in retail and mandatory and is deemed incorporated in the
service establishments CBA.
employing less than 10
workers) Nature of 13th Month Pay
First 8 200% Such is in the nature of additional income
Hours granted to employees who are not receiving
Worked Excess of + 30% of the same. (Agabon v. NLRC, G.R. No. 158693,
8 hourly rate 17 Nov. 2004) It is based on wage but not part
Hours on said da of wage. (Central Azucarera de Tarlac v.
Falling on a rest day Central Azucarera de Tarlac Labor
Union-NLU, G.R. No. 188949)
Unworked 100%
First 8 + 30% of 200%
Minimum Period of Service Required
hours
Worked It is imposed as a ‘minimum service
Excess of + 30% of hourly
8 hours rate on said day requirement’ that the employee should have
worked for at least one (1) month during a
SPECIAL DAYS
calendar year. (No. X[A], DOLE Handbook on
NO PAY, unless there is a
Workers Statutory Monetary Benefits)
favorable company policy,
Unworked practice or CBA granting
Persons Covered by PD 851
payment of wages on special
days even if unworked 1. Employees
First 8 + 30% of the GR: All rank-and-file employees are covered
hours daily rate (100%) by PD 851 regardless of the amount of basic
Worked salary that they receive in a month, if their
Excess of + 30% of hourly
8 hours rate on said day employers are not otherwise exempted from
paying the 13th month pay. Such employees
Worked & First 8 +50% of daily
are entitled to the 13th month pay regardless of
Falling On hours rate
said designation of employment status, and
A Rest Day Excess of +30% of hourly
irrespective of the method by which their
8 hours rate
wages are paid.
SPECIAL WORKING HOLIDAYS – only
the basic rate
Provided that they have worked for at least one
month, during a calendar year. (Revised
h. 13th Month Pay Guidelines on the Implementation of the
13th Month Pay Law)
It is a form of monetary benefit equivalent to
the monthly basic compensation received by XPNs:
an employee, computed pro-rata according to a. Government employees;
the number of months within a year that the b. Employees paid purely on commission
employee has rendered service to the Er. basis;
c. Employees already receiving 13th
month pay;

45
 d. Managers; and
e. Seafarers
Note: Managerial employees may receive 13th
month pay if they are granted under an
employment contract or a company policy or
practice. (Chan, 2019)
2. Employers
GR: All employers are covered by PD 581.
XPNs:
a. The Government and any of its political
subdivisions, including GOCCs;
XPN to this XPN: Corporations
operating essentially as private
subsidiaries of the Government.
b. Employers already paying their
employees 13th month pay or more in a
calendar year in its equivalent at the
time of the issuance of the Revised
Guidelines;
c. Employers of those who are paid on
purely basis of:
1. Commission;
Note: Bus drivers and conductors
who are paid a fixed or
guaranteed minimum wage, in
case their commission be less
than the statutory minimum, are
entitled to a 13th-month pay
equivalent to one-twelfth of their
total earnings during the calendar
year. (Philippine Agricultural
Commercial and Industrial
Workers Union v. NLRC, G.R.
No. 107994)
2. Boundary; or
3. Task; and
4. Fixed amount for performing a
specific work irrespective of the
time consumed in the
performance thereof.
Exception: Where the workers
are paid on a piece-rate basis, in
which case, the Er shall be
covered by the Revised
Guidelines insofar as the workers
are concerned.
Note: Piece-Rate Workers 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.
d. Distressed Employers:
1. Currently incurring substantial
losses; or
2. In the case of non-profit
institutions and organizations,
where their income, whether from
donations, contributions, grants
and other earnings from any
source, has consistently declined
by more than 40% of their normal
income for the last two (2) years,
subject to the provision of Sec. 7
of P.D. 851.
Other types of employment entitled to 13th
month pay
1. Part-time Employee; (Item 5[b],
Revised Guidelines of PD 851)
2. Extras;
3. Casual Employee; and Seasonal
Employee. (BWC Opinion, 19 Dec.
1987)
Equivalent forms of the 13th month pay
1. Christmas Bonus;
2. Midyear Bonus;
3. Profit Sharing Scheme; and
4. Other Cash bonuses amounting to not
less than 1/12 of its basic salary
Note: It must always be in the form of a legal
tender.
Things Not Proper Substitutes For 13th
Month Pay
1. Free rice;
2. Electricity;
3. Cash and stock dividends; and
4. Cost-of-living Allowance. (Sec. 3, P.D.
85)
Leaves
a. Service Incentive Leave
It is a five-day leave with pay for every
employee who has rendered at least one year
of service whether continuous or broken. (Art.
95, LC)
GR: Every employee who has rendered at
least one (1) year of service shall be entitled to
a yearly SIL of five (5) days with pay. Leave
pay means an employee gets paid despite
absence from work. (Azucena, 2016)
46
XPNs:
1. Government employees, whether
employed by the National Government
or any of its political subdivisions,
including those employed in
government-owned and/or controlled
corporations with original charters or
created under special laws;
2. House helpers and persons in the
personal service of another;
3. Managerial employees, if they meet all
of the following conditions.
1.1 Their primary duty is to manage
the establishment in which they
are employed or of a department
or subdivision thereof;
1.2 They customarily and regularly
direct the work of two or more
employees therein;
1.3 They have the authority to hire or
fire other employees of lower
rank; or their suggestions and
recommendations as to hiring,
firing, and promotion, or any
other change of status of other
employees are given particular
weight.
4. Field personnel and those whose time
and performance is unsupervised by the
employer;
5. Those already enjoying this benefit;
6. Those enjoying vacation leave with pay
of at least five (5) days; and
7. Those employed in establishments
regularly employing less than ten (10)
employees. (IRR Labor Code, Sec. 1,
Rule V, Book III)
Meaning of “at least 1 year of service”
Service for not less than 12 months, whether
continuous or broken reckoned from the date
the employee started working, including
authorized absences and paid regular holidays
unless the working days in the establishment
as a matter of practice or policy, or that
provided in the employment contract is less
than 12 months, in which case said period shall
be considered as one year (Integrated
Contractor and Plumbing Works v. NLRC,
G.R. No. 152427)
Commutability of SIL to monetary
equivalent
It is commutable if not used or exhausted at
the end of the year. It is aimed primarily at
encouraging workers to work continuously and
with dedication to the company.
Exception: R.A. No. 10361 grants SIL to
domestic workers. Their SIL need not be
converted to cash or carried over to
succeeding years. (Art. 139, LC)
Basis for cash conversion
The basis shall be the salary rate at the date of
commutation. The availment and commutation
of the SIL may be on a pro-rata basis.
Prescription of SIL
Applying Art. 306 of the Labor Code in light of
the peculiarity of SIL, the three (3)-year
prescriptive period commences, not at the end
of the year when the employee becomes
entitled to the commutation of his SIL, but from
the time when the Er refuses to pay its
monetary equivalent after demand of
commutation or upon termination of the
employees’ services, as the case may be.
(Autobus Transport Systems v. Bautista,
G.R. No. 156367)
b. Maternity Leave
105-Day Expanded Maternity Leave Law
A female Social Security System (SSS)
member who has paid at least three (3)
monthly contributions in the twelve (12)-month
period immediately preceding the semester of
her childbirth, miscarriage, or emergency
termination of pregnancy shall be paid her daily
maternity benefit which shall be computed
based on her average monthly salary credit for
one hundred five (105) days, regardless of
whether she gave birth via cesarean section or
natural delivery.
Conditions for entitlement:
1. That the female worker 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;
2. That the full payment shall be advanced
by the employer within thirty (30) days
from the filing of the maternity leave
application;
3. That payment of daily maternity benefits
shall be a bar to the recovery of
sickness benefits provided under
Republic Act No. 1161, as amended, for
the same period for which daily
maternity benefits have been received;
4. That the SSS shall immediately
reimburse the employer of one hundred
percent (100%) of the amount of
maternity benefits advanced to the
female worker by the employer upon
receipt of satisfactory and legal proof of
such payment; and
47
 5. That if a female worker should give birth
or suffer a miscarriage or emergency
termination of pregnancy without the
required contributions having been
remitted for her by her employer to the
SSS, or without the latter having been
previously notified by the employer of
the time of the pregnancy, the employer
shall pay to the SSS damages
equivalent to the benefits which said
female member would otherwise have
been entitled to. (RA 11210, Sec. 5a)
In case the employee qualifies as a solo
parent under the Solo Parents’ Welfare
Act, the employee shall be paid an
additional maternity benefit of 15 days.
(RA 11210, Sec. 5a)
An additional maternity leave of 30 days,
without pay, can be availed of, at the option of
the female worker, provided:
1. That the employer shall be given due
notice, in writing, at least 45 days before
the end of her maternity leave;
2. That no prior notice shall be necessary
in the event of a medical emergency but
subsequent notice shall be given to the
head of the agency. (RA 11210, Sec.
5b)
Workers availing of the maternity leave period
and benefits must receive their full pay.
Employers from the private sector shall be
responsible for payment of the salary
differential between the actual cash benefits
received from the SSS by the covered female
workers and their average weekly or regular
wages, for the entire duration of the maternity
leave, except:
1. Those operating distressed
establishments;
2. Those retail/service establishments and
other enterprises employing not more
than 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. (RA 11210, Sec. 5c)
Note: Women in the military, police, and other
services shall be entitled to leave benefits such
as maternity leave, as provided for by existing
laws (Magna Carta of Women, Sec. 15)
It is not necessary that the woman be
impregnated by her legitimate husband. It is
immaterial who the father is.
Every pregnant woman in the private sector,
whether married or unmarried, is entitled to
maternity leave benefits.
c. Paternity Leave
Paternity Leave refers to the benefits granted
to a married male employee allowing him not to
report for work for seven (7) days but continues
to earn the compensation therefor, on the
condition that his spouse has delivered a child
or suffered a miscarriage for purposes of
enabling him to effectively lend support to his
wife in her period of recovery and/or in the
nursing of the newly-born child. (R.A. No.
8187, Sec. 3)
Coverage
Paternity Leave is granted to all married male
employees in the private sector, regardless of
their employment status (e.g., probationary,
regular, contractual, project basis).
Government employees are also entitled to the
paternity leave benefit. They shall be governed
by the Civil Service rules.
Conditions to entitlement:
1. A married male employee at the time of
delivery of his child;
2. Cohabiting with his spouse at the time
she gives birth or suffers a miscarriage;
3. Applied for paternity leave within a
reasonable period from the expected
date of delivery by the pregnant spouse,
or within such period as may be
provided by company rules or by CBA;
provided that prior application is not
required in case of miscarriage;
4. Wife has given birth or suffered a
miscarriage.
5. Where a male employee is already
enjoying the paternity leave benefits by
reason of contract, company policy or
CBA, the greater benefit prevails.
Application for Paternity Leave
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 by the pregnant
spouse, or within such period as may be
provided by company rules and regulations or
by collective bargaining agreement, provided
that prior application for leave shall not be
48
required in case of miscarriage (IRR of R.A.
No. 8187 for the private sector, Sec. 4)
Non-conversion to Cash
In the event that the paternity leave is not
availed of, it shall not be convertible to cash
and shall not be cumulative. (IRR of R.A. No.
8187, Sec. 7)
d. Solo Parent Leave
Parental (Solo Parent Leave)
Benefits granted to a solo parent to enable
him/her to perform parental duties and
responsibilities where physical presence is
required. The parental leave, in addition to
leave privileges under existing laws, shall be
for seven (7) work days every year, with full
pay, consisting of basic salary and mandatory
allowances fixed by the Regional Wage Board,
if any, provided that his/her pay shall not be
less than the mandated minimum wage. (IRR
of R.A. No. 8972, Sec. 6[g])
Coverage
Who are considered Solo Parents:
a. A parent left alone with the responsibility
of parenthood because of the death of
one’s spouse.
b. A parent left alone with the responsibility
of parenthood because of any physical
and/or mental incapacity of one’s spouse
as certified by a public medical
practitioner
c. A parent left alone with the responsibility
of parenthood because one has legally
separated from his spouse or because
they have been separated for at least
one year and the child is in solo parent’s
custody
d. A parent left alone with the responsibility
of parenthood because the marriage was
annulled by a court or a church decree,
and the child is in solo parent’s custody.
e. A parent left alone with the responsibility
of parenthood because his spouse
abandoned him for at least one year.
f. A parent left solo or alone with the
responsibility of parenthood because his
spouse is detained or is serving
sentence for a crime for at least one
year.
g. An unmarried mother or father who has
preferred to keep and rear the child
himself, instead of having others care for
them or give up to a welfare institution.
h. Solely provides parental care and
support to a child or children.
i. Assumes responsibility of head of the
family as a result of the death,
abandonment, disappearance or
prolonged absence of the children’s
parents or solo parent.
j. A victim of rape and/or other crimes
against chastity, have given birth to a
child as a result and have decided to
keep and raise his child. (R.A. No. 8972,
Sec. 3[a])
Children
1. Those living with and dependent upon
the solo parent for support who are
unmarried, unemployed and not more
than 18 years of age; or
2. Those even over 18 years but are
incapable of self-support because of
mental and/or physical defect (R.A. No.
8972, Sec. 3[e])
Conditions to Entitlement
1. He/she has rendered at least 1 year of
service, whether continuous or broken;
2. He/she has notified his/her employer of
the availment thereof within a
reasonable period
3. He/she has presented a Solo Parent
Identification Card to his/her employer
which may be obtained from the DSWD
office of the city or municipality where
he/she resides (IRR of R.A. No. 8972,
Sec. 19)
Availment
A parental leave of not more than 7 working
days every year shall be granted to any solo
parent employee who has rendered service of
at least 1 year.
Non-Conversion to Cash
Unused parental leave is not convertible to
cash unless otherwise provided by the CBA.
(IRR of R.A. No. 8972, Sec. 20)
Termination of the benefit
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. (R.A. No.
8972, Sec. 3[a])
e. Leave Benefits for Women Workers
Under Magna Carta of Women (RA 9710)
and Anti-Violence Against Women and their
Children of 2004 (RA 9262)
49
1. R.A. No. 9710 or the Magna Carta for
Women - A special leave benefit for women
was granted under R.A. No. 9710 (August
14, 2009). Women who qualify under R.A.
No. 9710 are entitled to a special leave
benefit of two (2) months with full pay
based on her gross monthly compensation
following surgery caused by gynecological
disorders.
Conditions for Entitlement:
1. A woman employee must have rendered
continuous aggregate employment
service of at least six (6) months for the
twelve (12) months immediately prior to
the surgery
2. She has filed an application for special
leave with her employer within a
reasonable period of time from the
expected date of surgery or within such
period as may be provided by company
rules and regulations or collective
bargaining agreement; and
3. She has undergone surgery due to
gynecological disorders as certified by a
competent physician.
2. R.A. No. 9262 or the Anti-Violence
Against Women and their Children Act of
2004 - 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 will 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.
Coverage
Allows the victim of violence, which may be
physical, sexual, or psychological, to apply for
the issuance of a protection order. If such a
victim is an employee, she is entitled to a paid
leave of up to 10 days in addition to other paid
leaves under the Labor Code, other laws and
company policies.
Conditions to entitlement
1. The employee has to submit a
certification from the Punong Barangay
or Kagawad or prosecutor or Clerk of
Court that an action under RA 9262 has
been filed and is pending.
2. The use of the 10-day leave is at the
option of the employee
3. It shall be used for the days that she
needs to attend to medical and legal
concerns.
4. Leaves not availed of are
non-cumulative and not convertible to
cash.
Availment
Leave of up to ten (10) days in addition to other
paid leaves under the Labor Code, or other
laws. (Sec. 43, RA 9262)
f. Compassionate Leaves
Bereavement Leave. - Under this Act,
employees in the private and public sectors
shall be entitled to a bereavement leave of ten
(10) days with full pay following the death of an
employee's Immediate family member in order
to grieve, attend to or make arrangements for
the funeral.
Special Groups of Employees
a. Women
Laws protecting women Workers
1. The State recognizes the role of women
in nation-building, and shall ensure the
fundamental equality before the law of
women and men.
2. The State shall protect working women
by providing safe and healthful working
conditions, taking into account their
maternal functions, and such facilities
and opportunities that will enhance their
welfare and enable them to realize their
full potential in the service of the nation.
3. R.A. No. 6725 or “An Act Strengthening
the Prohibition on Discrimination against
Women with Respect to Terms and
Conditions of Employment” – which
explicitly prohibits discrimination against
women with respect to terms and
conditions of employment, promotion,
and training opportunities.
4. R.A. No. 6955 or “An Act to Declare
Unlawful the Practice of Matching
Filipino Women for Marriage to Foreign
Nationals on Mail Order Basis” – which
bans the “mail-order-bride” practice for a
fee and the export of female labor to
countries that cannot guarantee
protection to the rights of women
workers.
5. R.A. No. 7192 or “Women in
Development and Nation Building Act” –
affords women equal opportunities with
men to act and to enter into contracts,
and for appointment, admission,
50
 training, graduation, and commissioning
in all military or similar schools.
6. R.A. No. 7322 or “An Act Increasing
Maternity Benefits in Favor of Women
Workers in the Private Sector”
7. R.A. No. 7877 or “Anti-Sexual
Harassment Act”
8. R.A. No. 8042 or the “Migrant Workers
and Overseas Filipinos Act of 1995” –
which prescribes as a matter of policy,
the deployment of migrant workers, with
emphasis on women, only in countries
where their rights are secure. (Philippine
Telegraph and Telephone Co. v. NLRC,
G.R. No. 118978, 23 May 1997)
9. R.A. No. 9710 or “the Magna Carta of
Women”
10. R.A. No. 9262 or the “Anti-Violence
against Women and Children”
State Policy on Non-Discrimination Against
Women
The State condemns discrimination against
women in all its forms and pursues by all
appropriate means and without delay the policy
of eliminating discrimination against women in
keeping with the Convention on the Elimination
of All Forms of Discrimination Against Women
(CEDAW) and other international instruments
consistent with Philippine law. The State shall
accord women the rights, protection, and
opportunities available to every member of
society. (Sec. 2, R.A. No. 9710 or the Magna
Carta of Women)
The State shall take steps to review and, when
necessary, amend and/or repeal existing laws
that are discriminatory to women within three
(3) years from the effectivity of this Act. (Sec.
12, R.A. No. 9710)
1. Discrimination
a. Discrimination with respect to the terms and
conditions of employment solely on account
of sex.
1. Discrimination in pay – Payment of a
lesser compensation including wage,
salary or other forms of remuneration
and fringe benefits, to a female
employees as against a male employee;
2. Discrimination in employment
opportunity – favoring a male
employee over a female employee with
respect to promotion, assignment,
transfer, training opportunities, study
and scholarship grants solely on
account of their sexes;
3. Discrimination in hiring – favoring a
male applicant with respect to hiring
where the particular job can equally be
handled by a woman;
4. Discrimination in dismissal – favoring
a male Ee over a female employee with
respect to dismissal of personnel or the
application of the “last in, first out
principle” or other retrenchment policy of
the Er.
b. Stipulating, whether as a condition for
employment or continuation of employment:
1. That a woman employee shall not get
married; or
2. That upon marriage, such a woman
employee shall be deemed resigned or
separated.
3. Dismissing, discriminating or otherwise
prejudice a woman employee by reason
of her being married.
2. Stipulation Against Marriage
It shall be unlawful for the employer:
1. To require as a condition of employment
or continuation of employment that a
woman employee shall not get married;
2. To stipulate expressly or tacitly that
upon getting married, a woman
employee shall be deemed resigned or
separated
3. To actually dismiss, discharge,
discriminate or otherwise prejudice a
woman employee merely by reason of
her marriage (Labor Code, Art. 134)
The Magna Carta of Women protects women
against discrimination in all matters relating to
marriage and family relations, including the
right to freely choose a spouse and to enter
into marriage only with their free and full
consent.
Case Doctrines:
1. It was declared that the company 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.
(Philippine Telegraph and Telephone
Company v. NLRC, G.R. No. 118978)
2. The following policies were struck down as
invalid for violating the standard of
reasonableness which is being followed in
our jurisdiction, otherwise called the
“Reasonable Business Necessity Rule”
51
 i) New applicants will not be allowed to be
hired if in case he/she has [a] relative,
up to [the] 3rd degree of relationship,
already employed by the company.
ii) In case of two of our employees (both
singles [sic], one male and another
female) developed a friendly relationship
during the course of their employment
and then decided to get married, one of
them should resign to preserve the
policy stated above. (Star Paper Corp.
v. Simbol, G.R. No. 164774)
3. The prohibition against marriage embodied
in the following stipulation in the employment
contract was held as valid: “10. You agree to
disclose to management any existing or future
relationship you may have, either by
consanguinity or affinity with co-employees or
employees of competing drug companies.
Should it pose a possible conflict of interest in
management discretion, you agree to resign
voluntarily from the Company as a matter of
Company policy.”
The Supreme Court ruled that the dismissal
based on this stipulation in the employment
contract is a valid exercise of management
prerogative. The prohibition against personal or
marital relationships with employees of
competitor companies upon its employees was
held reasonable under the circumstances
because relationships of that nature might
compromise the interests of the company. In
laying down the assailed company policy, the
employer only aims to protect its interests
against the possibility that a competitor
company will gain access to its secrets and
procedures. (Duncan Association of
Detailman-PTGWO v. Glaxo Welcome
Philippines, Inc, G.R. No. 162994)
4. True, Article 132 [130] enjoins the Secretary
of Labor to establish standards that will ensure
the safety and health of women employees and
in appropriate cases shall by regulation require
employers to determine appropriate minimum
standards for termination in special
occupations, such as those of flight attendants,
but that is precisely the factor that militates
against the policy of respondent [employer
PAL]. The standards have not yet been
established as set forth in the first paragraph,
nor has the Secretary of Labor issued any
regulation affecting flight attendants. It is logical
to presume that, in the absence of said
standards or regulations which are as yet to be
established, the policy of respondent PAL
against marriage is patently illegal. (Zialcita, et
al. vs. Philippine Air Lines, Case No.
RO4-3-3398-76, February 20, 1977)
5. No employer may require female applicants
for jobs to enter into preemployment
agreements that they would be dismissed once
they get married and afterwards expect the
Courts to sustain such an agreement. Neither
may an employer ask a female employee to
sign an undated letter of resignation which
would be accepted once she gets married.
(Olympia Gualberto, et al. vs. Marinduque
Mining Industrial Corporation, CA-G.R. No.
52753-R)
Bona fide occupational qualification
exception While a marriage or no-marriage
qualification may be justified as a "bona fide
occupational qualification," the employer must
prove two factors necessitating its imposition,
viz:
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. [Capin-Cadiz v. Brent Hospital
and Colleges, Inc., G.R. No. 187417]
Bona fide occupational qualification
exception
When the employer can prove that the
reasonable demands of the business require a
distinction based on marital status and there is
no better available or acceptable policy which
would better accomplish the business purpose,
an employer may discriminate against an
employee based in the identity of the
employee’s spouse. (Star Paper Corp. vs.
Simbol, G.R. No. 164774)
3. Prohibited Acts [Art. 135, Labor Code]
1. Discharge to prevent enjoyment of
benefits.
To deny any woman employee the benefits
provided for in this Chapter or to discharge any
woman employed by him for the purpose of
preventing her from enjoying any of the benefits
provided under this Code. [Art. 135 (1), as
amended by R.A. 6725]
2. Discharge on account of pregnancy.
To discharge such woman on account of her
pregnancy, while on leave or in confinement
due to her pregnancy. [Art. 135 (2)]
3. Discharge or refusal of the admission to
work
To discharge or refuse the admission of such
woman upon returning to her work for fear that
she may again be pregnant. [Art. 135 (3)]
52
 4. Discharge on account of testimony
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
[Sec. 13 (d), Rule XII, Book III, IRR]
5. Expulsion of Women faculty/female
student due to pregnancy outside of
marriage
Expulsion and non-readmission of women
faculty due to pregnancy outside of marriage
shall be outlawed. No school shall turn out or
refuse admission to a female student solely on
the account of her having contracted pregnancy
outside of marriage during her term in school.
[Sec. 13(c), RA 9710]
6. Prohibition against marriage as condition
for employment
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.
b. Minors
Relevant Laws: RA 7610 (Special Protection of
Children Against Abuse, Exploitation and
Discrimination Act), RA 9231 (Special
Protection of Children Against Child Abuse,
Exploitation and Discrimination Act, Art.
137(a))
Constitutional basis
The State recognizes the vital role of the youth
in nation-building and shall promote and
protect their physical, moral, spiritual,
intellectual, and social well-being. It shall
inculcate in the youth patriotism and
nationalism, and encourage their involvement
in public and civic affairs. [Sec. 13, Art. II,
1987 Constitution]
GR: Children below 15 shall NOT be
employed.
XPN (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 DOLE which shall ensure
observance of the above requirements.
For purposes of this Article, the term "child"
shall apply to all persons under eighteen (18)
years of age. [Sec. 2, RA 9231]
Children - refers to any person under 18 years
of age or those over but are unable to fully take
care of themselves or protect themselves from
abuse, neglect, cruelty, exploitation or
discrimination because of a physical or mental
disability or condition. [Sec. 2, RA 7610]
Child labor - refers to any work or economic
activity performed by a child that subjects
him/her to any form of exploitation or is harmful
to his/her health and safety or physical, mental
or psychosocial development.
Working child - refers to any child engaged as
follows:
1. when the child is below eighteen (18)
years of age, in work or economic
activity that is not child labor as defined
in the immediately preceding
subparagraph; and
53
 2. When the child is below fifteen (15)
years of age, in work where he/she is
directly under the responsibility of
his/her parents or legal guardian and
where only members of the child‘s
family are employed; or in public
entertainment or information. [Sec. 3,
D.O. No. 65-04]
Exceptions
1. Child works directly under the sole
responsibility of his parents or legal
guardian and where only members of
the employer’s family are employed,
provided:
a. his employment does NOT
endanger his life, safety, health
and morals
b. nor impairs his normal
development, and
c. the parent or legal guardian shall
provide the said minor child with
the prescribed primary and/or
secondary education; [Sec. 12 of
RA 7610, as amended by RA
7658]
2. Child’s employment or participation in
public entertainment or information
through cinema, theater, radio or
television is essential, provided that
[Sec. 12 of RA 7610, as amended by
RA 7658]:
a. employment does NOT involve
ads or commercials promoting
alcohol, tobacco and its
by-products or violence [Sec. 14,
RA 7610]
b. the employment contract is
concluded by the child’s parents
or guardian, and approved by
DOLE
c. The ER shall ensure the
protection, health, safety and
morals of the child
d. The ER 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
e. The ER shall formulate and
implement, subject to the
approval and supervision of
competent authorities, a explosive power-actuated tools;
continuing program for training
and skills acquisition of the child.
[Sec. 12 of RA 7610, as
amended by RA 7658]
Employment of Children from 15 to 18
Employment is allowed even without permit but
restricted to non-hazardous work.
Non-hazardous work shall mean any work or
activity in which the EE is not exposed to any
risk which constitutes an imminent danger to
his safety and health. [Sec. 3, Rule XII, Book
III, IRR]
The Secretary of Labor shall from time to time
publish a list of hazardous work and activities
in which persons 18 years of age and below
cannot be employed [Sec. 3, Rule XII, Book
III, IRR]
The following are HAZARDOUS workplaces:
See DO 149-16 as amended by DO 149-A-17,
Sec. 6
Worst Forms of Child Labor
1. All forms of slavery, as defined under
the "Anti-trafficking in Persons Act of
2003", or practices similar to slavery
such as sale and trafficking of children,
debt bondage and serfdom and forced
or compulsory labor, including
recruitment of children for use in armed
conflict; or
2. The use, procuring, offering or exposing
of a child for prostitution, for the
production of pornography or for
pornographic performances; or
3. The use, procuring or offering of a child
for illegal or illicit activities, including the
production and trafficking of dangerous
drugs and volatile substances prohibited
under existing laws; or
4. Work which, by its nature or the
circumstances in which it is carried out,
is hazardous or likely to be harmful to
the health, safety or morals of children,
such that it:
a. Debases, degrades or demeans
the intrinsic worth and dignity of a
child as a human being; or
b. Exposes the child to physical,
emotional or sexual abuse, or is
found to be highly stressful
psychologically or may prejudice
morals; or
c. Is performed underground,
underwater or at dangerous
heights; or
d. Involves the use of dangerous
machinery, equipment and tools
such as power-driven or
or
e. Exposes the child to physical
danger such as, but not limited to
the dangerous feats of balancing,
physical strength or contortion, or
which requires the manual
transport of heavy loads; or
54
 f. Is performed in an unhealthy
environment exposing the child to
hazardous working conditions,
elements, substances, co-agents
or processes involving ionizing,
radiation, fire, flammable
substances, noxious components
and the like, or to extreme
temperatures, noise levels, or
vibrations; or
g. Is performed under particularly
difficult conditions; or
h. Exposes the child to biological
agents such as bacteria, fungi,
viruses, protozoans, nematodes
and other parasites; or
i. Involves the manufacture or
handling of explosives and other
pyrotechnic products [Sec. 12-D,
RA 9231 as amended].
Prohibition on the employment of children
in certain undertaking and certain
advertisements
No child shall be employed as a model in any
advertisement directly/indirectly promoting
alcoholic beverage, intoxicating drinks, tobacco
and its byproducts, gambling or any form of
violence or pornography. (Sec. 5)
Working Hours of a Child Quantity
Age Bracket Daily Max Weekly Max
Below 15 y/o 4 hrs 20 hrs
15 to below 8hrs 40 hrs
18
Night work prohibition
Age Bracket Prohibited Hours
Below 15 y/o 8 pm to 6 am (10
hrs.)
15 to below 18 10 pm to 6 am (8
hrs.)
Discrimination
No employer shall discriminate against any
person in respect to terms and conditions of
employment on account of his age. [Art. 138]
Employment Of Poor But Deserving
Students
Republic Act No. 7323, approved on March 30,
1992 by President Corazon C. Aquino, aims to
help poor but deserving students pursue their
education. It encourages their employment in
private firms and government agencies through
incentives granted to employers, allowing them
to pay only 60% of their salaries or wages and
the 40% through education vouchers to be paid
by the government. (Azucena, 2021)
c. Kasambahays
Relevant Law: RA 10361 (Batas Kasambahay
or Domestic Worker’s Act Note: RA 10361 has
expressly repealed Chapter III, “Employment of
Househelpers”, Title III, Book III of the Labor
Code)
Domestic work - This refers to work
performed in or for a household or households.
[Sec 4(c)., RA 10361]
Household - refers to the immediate members
of the family or the occupants of the house that
are directly provided services by the domestic
worker. [Sec 4(f), RA 10361]
Domestic worker or “Kasambahay” - Refers
to any person engaged in domestic work within
an employment relationship such as, but not
limited to, the following: general househelp,
nursemaid or “yaya”, cook, gardener, or
laundry person. [Sec 4(d), RA 10361]
The term domestic worker or “kasambahay”
excludes any person who performs domestic
work only occasionally or sporadically and not
on an occupational basis. [Sec.4(d), RA
10361]
Note: IRR, Sec. 2 does not include family
drivers.
Employment contract
An employment contract shall be executed by
and between the domestic worker and the
employer before the commencement of the
service in a language or dialect understood by
both parties and shall include the following:
1. the kasambahay's duties and
responsibilities
2. period of employment
3. compensation
4. authorized deductions
5. working conditions
6. Termination of employment
7. any other lawful condition agreed upon
by both parties. (Sec. 11)
Minimum wage
The minimum wage of domestic workers shall
not be less than the following:
a. P2,500 a month for those employed in
NCR
b. P2,000 a month for those employed in
chartered cities and first class
municipalities
c. P1,500 a month for those employed in
other municipalities
55
Within one year from the effectivity of RA
10361, and periodically thereafter, the Regional
Board shall review, and if proper, determine
and adjust the minimum wage rates of
domestic workers. [Sec. 24, RA 10361]
Standard of Treatment
The employer or any member of the household
shall not subject a domestic worker or
“kasambahay” to any kind of abuse nor inflict
any form of physical violence or harassment or
any act tending to degrade the dignity of a
domestic worker. [Sec. 5, RA 10361]
Board, Lodging and Medical Attendance
The employer shall provide for the basic
necessities of the domestic worker to include:
1. At least three adequate meals a day
2. Humane sleeping arrangements that
ensure safety
3. Appropriate rest and assistance in case
of illnesses and injuries sustained during
service without loss of benefits. [Sec. 6,
RA 10361]
Privacy
Respect for the privacy of the domestic worker
shall be guaranteed at all times and shall
extend to all forms of communication and
personal effects [Sec. 7, RA 10361]
Access to Outside Communication
The employer shall grant the domestic worker
access to outside communication during free
time: Provided, That in case of emergency,
access to communication shall be granted
even during work time. [Sec. 8, RA 10361]
Education and Training
The employer shall afford the domestic worker
the opportunity to finish basic education and
may allow access to alternative learning
systems and, as far as practicable, higher
education or technical and vocational training.
[Sec. 9, RA 10361]
Social and Other Benefits
A domestic worker who has rendered at least
one (1) month of service shall be covered by
the Social Security System (SSS), the
Philippine Health Insurance Corporation
(PhilHealth), and the 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 shall be
shouldered by the employer. However, if the
domestic worker is receiving a wage of
P5,000.00 and above per month, the domestic
worker shall pay the proportionate share in the
premium payments or contributions.
Leave Benefits
A domestic worker who has rendered at least
one (1) year of service shall be entitled to an
annual service incentive leave of five (5) days
with pay. [Sec. 29, RA 10361]
Rest Periods
Daily Rest Period: 8 hours
Weekly Rest Period: at least 24 consecutive
hours. The employer and employee may agree
to:
a. Offsetting a day of absence with a
particular rest day;
b. Waiving a particular rest day in return for
an equivalent daily rate of pay;
c. Accumulating rest days not exceeding
five (5) days; or
d. Other similar arrangements. [Sec. 20,
21, RA 10361]
Pre-Employment Requirement
Prior to the execution of the employment
contract, the employer may require the
following from the domestic worker:
a. Medical certificate or a health certificate
issued by a local government health
officer;
b. Barangay and police clearance;
c. National Bureau of Investigation (NBI)
clearance; and
d. Duly authenticated birth certificate or if
not available, any other document
showing the age of the domestic worker
such as voter’s identification card,
baptismal record or passport.
However, Sec. 12(a), (b), (c) and (d) shall be
standard requirements when the employment
of the domestic worker is facilitated through the
PEA.
The cost of the foregoing shall be borne by the
prospective employer or agency, as the case
may be. [Sec. 12, RA 10361]
Pre-Employment Prohibition
The ff. shall be unlawful:
1. Charging any share in the recruitment or
finder’s fees against the domestic
worker by a private employment agency
or third party. [Sec. 13, RA 10361]
2. Requiring a domestic worker to make
deposits from which deductions shall be
made for the reimbursement of loss or
damage to tools, materials, furniture and
equipment in the household. [Sec. 14,
RA 10361]
3. Placing the domestic worker under debt
bondage by the employer or any person
acting on behalf of the employer [Sec.
15, RA 10361]
56
Time and Manner of Payment
Payment of wages shall be made:
1. Directly to the domestic worker in cash
2. At least once a month
3. With no deductions from the wages
other than that which is mandated by
law, unless allowed by the domestic
worker through a written consent
No employer shall pay the wages of a domestic
worker by means of promissory notes,
vouchers, coupons, tokens, tickets, chits, or
any object other than the cash wage as
provided for under this Act. [Sec. 25, RA
10361]
Payslip
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.
The copies of the pay slip shall be kept by the
employer for a period of three (3) years. [Sec.
26, RA 10361]
Wage Prohibitions
It shall be unlawful for the original employer to
charge any amount from the said household
where the service of the domestic worker was
temporarily performed. [Sec. 23, RA 10361]
Other Prohibited Acts
a. Interference in employee’s wage
disposal [Sec. 27, RA 10361]
b. Direct or indirect withholding of wages
by the employer [Sec. 28, RA 10361]
c. Payment in forms other than cash [Sec.
25, RA 10361]
Right against assignment to non-household
work at a wage rate lower than that mandated
for agricultural or non-agricultural enterprises
depending on the case. [Sec. 22, RA 10361]
Employment Age of Domestic Workers:
Unlawful to employ any person below fifteen
(15) years of age as a domestic worker [Sec.
16, RA 10361]
Persons between 15-18 years old should only
be employed in non-hazardous work. [D.O. No.
4-99 Sec. 4]
Daily Rest Period: Aggregate of eight (8)
hours per day. [Sec. 20, RA 10361]
Employment Certification: ER shall give the
househelper a written statement of the nature
and duration of the service and his or her work
performance as househelper upon severance.
[Sec. 35, RA 10361]
Termination Initiated by the domestic
worker The domestic worker may terminate
the employment relationship at any time before
the expiration of the employment contract for
any of the following causes:
1. Verbal or emotional abuse of the
domestic worker by the employer or any
member of the household;
2. Inhuman treatment including physical
abuse of the domestic worker by the
employer or any member of the
household;
3. Commission of a crime or offense
against the domestic worker by the
employer or any member of the
household;
4. Violation by the employer of the terms
and conditions of the employment
contract and other standards set forth
under this law;
5. Any disease prejudicial to the health of
the domestic worker, the employer, or
member/s of the household; and
6. Other causes analogous to the
foregoing. [Sec. 33, RA 10361]
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:
1. Misconduct or willful disobedience by
the domestic worker of the lawful order
of the employer in connection with the
former’s work;
2. Gross or habitual neglect or inefficiency
by the domestic worker in the
performance of duties;
3. Fraud or willful breach of the trust
reposed by the employer on the
domestic worker;
4. Commission of a crime or offense by the
domestic worker against the person of
the employer or any immediate member
of the employer’s family;
5. Violation by the domestic worker of the
terms and conditions of the employment
contract and other standards set forth
under this law;
6. Any disease prejudicial to the health of
the domestic worker, the employer, or
member/s of the household; and
7. Other causes analogous to the
foregoing. [Sec. 34, RA 10361]
Employment Certification
Upon the severance of the employment
relationship, the employer shall issue the
domestic worker within five (5) days from
request a certificate of employment indicating
the nature, duration of the service and work
performance [Sec. 35, RA 10361].
57
Unjust dismissal
Neither the domestic worker nor the employer
may terminate the contract before the
expiration of the term except for grounds
provided in Secs. 33 and 34 of RA 10361.
If the domestic worker is unjustly dismissed,
the domestic worker shall be paid the
compensation already earned plus the
equivalent of 15 days work by way of indemnity
[Sec. 32, RA 10361].
Leaving without justifiable reason by the
domestic worker
a. Any unpaid salary due not exceeding
the equivalent 15 days work shall be
forfeited and
b. The employer may recover from the
domestic worker the costs incurred
related to the deployment expenses, if
any:
Provided, that the service has been
terminated within 6 months from the
domestic worker’s employment [Sec.
32, RA 10361].
Notice to end the working relationship
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.
The domestic worker and the employer may
mutually agree upon written notice to
pre-terminate the contract of employment to
end the employment relationship. [Sec. 32, RA
10361]
Penalties
Any violation of R.A. No. 10391 declared
unlawful shall be punishable with a fine of not
less than Ten thousand pesos (P10,000.00) but
not more than Forty thousand pesos
(P40,000.00) without prejudice to the filing of
appropriate civil or criminal action by the
aggrieved party.
d. Homeworkers
Industrial homework
a. Is a system of production under which
work for an employer or contractor is
carried out by a homeworker at his/her
home. Materials may or may not be
furnished by the employer or contractor.
b. Decentralized form of production, where
there is ordinarily very little supervision
or regulation of methods of work. [Sec.
2(a), Rule XIV, Book III, IRR]
Industrial Homeworker - a worker who is
engaged in industrial homework.
Employer means any natural or artificial
person who:
a. Acts as a contractor or subcontractor –
delivers or causes to be delivered any
goods, articles, or materials to be
processed or fabricated in or about a
home and thereafter to be returned or to
be disposed of or distributed in
accordance with employer’s direction;
OR
b. Sells any goods, articles, or materials to
be processed or fabricated in or about a
home and then rebuys them after. [Art.
153]
Rights and benefits accorded homeworkers
a. Right to form, join or assist
organizations
b. Right to acquire legal personality and
the rights and privileges granted by law
to legitimate labor organizations upon
issuance of the certification of
registration
c. Immediate payment upon employer’s
receipt of finished goods or articles
d. SSS, MEDICARE and ECC premium
contributions shall be deducted from
their pay and shall be remitted by
ER/contractor/subcontractor to the SSS
Liability of Employer
a. Employer may require homeworker to
redo work improperly executed without
additional pay
b. Employer need not pay homeworker for
any work done on goods or articles not
returned due to homeworker’s fault
c. If subcontractor/contractor fails to pay
homeworker, employer is jointly and
severally liable with the former to the
homeworker for his/her wage
d. Employer shall assist the homeworkers
in the maintenance of basic safe and
healthful working conditions at the
homeworkers’ place of work.
Regional Office shall provide technical
assistance to registered homeworkers’
organizations [Sec. 14, Rule XIV, Book III,
IRR]
Prohibited Homework
a. explosives, fireworks and articles of like
character;
b. drugs and poisons; and
58
 c. other articles, the processing of which
requires exposure to toxic substances.
[Sec. 13, Rule XIV, Book III, IRR]
Deductions
No deduction from the homeworker’s earnings
for the value of materials lost, destroyed or
damaged unless:
a. Homeworker is clearly shown to be
responsible for loss or damage
b. Reasonable opportunity to be heard
c. Amount of deduction is fair and
reasonable, and does not exceed actual
loss or damage
d. Deduction does not exceed 20% of
homeworker’s weekly earnings [Sec. 8,
Rule XIV, Book III, IRR]
e. Night Workers
Night worker
Any employed person whose work requires
performance of a substantial number of hours
of night work which exceed a specified limit.
This limit shall be fixed by the Sec of Labor
after consulting the workers’ representatives/
labor organizations and employers. [Art. 154,
as amended by RA 10151]
Any employed person whose work covers the
period from 10:00 pm to 6:00 am the following
morning, provided that the worker performs no
less than 7 consecutive hours of work. [Sec. 2,
Rule XV, Book III, Rule XV, Sec. 2, IRR,
through D.O. No. 119-12]
Health Assessment
At the worker’s request, they shall have the
right to undergo a health assessment without
charge and to receive advice on how to reduce
or avoid health problems associated with their
work:
a. Before taking up an assignment as a
night worker
b. At regular intervals during such an
assignment
c. If they experience health problems
during such an assignment
With the exception of a finding of unfitness for
night work, the findings of such assessments
shall be confidential and shall NOT be used to
their detriment, subject, however, to applicable
company policies. [Art. 155, as amended by
RA 10151; Sec. 3, Rule XV, Book III, IRR,
through D.O. No. 119-12]
Mandatory Facilities
Mandatory facilities shall be made available for
workers performing night work, which include
the following:
1. Suitable first-aid and emergency
facilities;
2. Lactation station in required companies
pursuant to RA 10028;
3. Separate toilet facilities for men &
women d. Facility for eating w/ potable
drinking water; AND
4. Facilities for transportation and/or
properly ventilated temporary sleeping
or resting quarters, separate for male
and female workers, shall be provided
except where any of the ff.
circumstances is present:
a. There is an existing company
guideline, practice or policy, CBA,
or any similar agreement
providing for an equivalent or
superior benefit; or
b. Start or end of the night work
does not fall within 12 mn - 5 am;
or
c. Workplace is located in an area
that is accessible 24 hours to
public transportation; or
d. Number of employees does not
exceed a specified number as
may be provided for by the sole
in subsequent issuances [Art.
156, as amended by RA 10151;
Sec. 4, Rule XV, Book III, IRR,
through D.O. No. 119-12]
Transfer
If night worker is unfit for night work due to
health reasons as certified by competent
physician, s/he shall be:
a. Transferred in good faith to a job for
which they are fit to work whenever
practicable, which must be similar and
equivalent position;
b. If transfer is not practicable, or workers
are unable to render night work for a
continuous period of not less than 6
months upon certification of a
competent public health authority, they
shall be granted the same benefits as
other workers who are unable to work
due to illness.
c. If workers are certified as temporarily
unfit to render night work for a period of
less than 6 months, they shall be given
the same protection against dismissal or
notice of dismissal as other workers who
are prevented from working for health
reasons. [Art. 157, as amended by RA
10151; Sec. 5, Rule XV, Book III, IRR,
through D.O. No. 119-12]
Women Night Workers
Employers shall ensure that measures shall be
taken to ensure that an alternative to night
work for pregnant and nursing employees who
would otherwise be called upon to perform
such work. Such measures may include:
59
 a. Transfer to day work – As far as
practicable, pregnant or nursing
employees shall be assigned to day
work, before and after childbirth, for a
period of at least sixteen (16) weeks,
which shall be divided between the time
before and after childbirth;
Medical certificate issued by competent
physician (OB/Gyne/Pedia) is necessary
for the grant of:
1. additional periods of assignment
to day work during pregnancy or
after childbirth, provided that
such shall not be more than 4
weeks or for a longer period as
may be agreed upon by employer
and worker;
2. extension of maternity leave; and
3. clearance to render night work.
b. Provision of social security benefits -
in accordance with provisions of Act No
8282 (Social Security Act of 1997) and
other existing company policy or
collective bargaining agreement.
c. Extension of maternity leave – where
transfer to day work is not possible, but
requires recommendation by competent
physician; without pay or using earned
leave credits, if any. [Art. 158, as
amended by RA 10151; Sec. 6, Rule
XV, Book III, IRR, through D.O. No.
119-12]
Protection against dismissal and loss of
benefits attached to employment status,
seniority, and access to promotion
Where no alternative work can be provided to a
woman employee who is not in a position to
render night work, she shall be allowed to go
on leave or on extended maternity leave, using
her earned leave credits.
A woman employee shall NOT be dismissed
for reasons of pregnancy, childbirth and
childcare responsibilities as defined under this
Rule. She shall NOT lose the benefits
regarding her employment status, seniority,
and access to promotion which may attach to
her regular night work position. [Sec. 8, Rule
XV, Book III, IRR, through D.O. No. 119-12]
Night Work Schedules
Before introducing work schedules requiring
the services of night workers, the employer
shall consult the workers’ representatives/labor
organizations concerned on the details of such
schedules and the forms of organization of
night work that are best adapted to the
establishment and its personnel, as well as on
the occupational health measures and social
services which are required. In establishments
employing night workers, consultation shall
take place regularly.
CBA provision vis-à-vis overtime work
CBA may stipulate higher overtime pay rate.
The basis of computation of overtime pay
beyond that required by Art. 87 of the Labor
Code must be the collective agreement. It is
not for the court to impose upon the parties
anything beyond what they have agreed upon
which is not tainted with illegality. On the other
hand, where the parties fail to come to an
agreement, on a matter not legally required,
the court abuses its discretion when it obliges
any of them to do more than what is legally
obliged. (PNB v. PNB Employee’s Assoc.,
G.R. No. L-30279)
f. Apprentices and Learners
Definition of Terms
a. Apprenticeship - training within
employment with compulsory related
theoretical instruction involving a
contract between an apprentice and an
employer on an approved
apprenticeable occupation. [Sec 4(j),
RA 7796]
b. Apprentice is a person undergoing
training for an approved apprenticeable
occupation during an apprenticeship
agreement. [Sec 4(k), RA 7796]
c. Apprenticeship Agreement is a
contract wherein a prospective employer
binds himself to train the apprentice,
who in turn accepts the terms of training
for a recognized apprenticeable
occupation emphasizing the rights,
duties and responsibilities of each party.
[Sec 4(l), RA 7796]
d. Apprenticeable Occupation is an
occupation officially endorsed by a
tripartite body and approved for
apprenticeship by the Authority. [Sec
4(m), RA 7796]
Who may employ apprentices
Only employers in highly technical industries
may employ apprentices and only in
apprenticeable occupations approved by the
sole. [Art. 60, LC]
The act of filing the proposed apprenticeship
program with the DOLE is a preliminary step
towards its final approval, and does not
instantaneously give rise to an
employer-apprentice relationship. It must be
duly approved by the Minister of Labor and
Employment. [Nitto Enterprises v. NLRC,
G.R. No. 114337]
Qualifications of apprentice
60
An apprentice must:
1. Be at least fifteen years of age; provided
those who are at least fifteen years of
age but less than eighteen may be
eligible for apprenticeship only in
nonhazardous occupations;
2. Be physically fit for the occupation in
which he desires to be trained;
3. Possess vocational aptitude and
capacity for the particular occupation as
established through appropriate tests;
and
4. Possess the ability to comprehend and
follow oral and written instructions.
Trade and industry associations may
recommend to the SOLE appropriate
educational qualifications for apprentices in
certain occupations.
GR: Such qualifications, if approved, shall be
the educational requirements for
apprenticeship in such occupations.
XPN: The educational qualifications may be
waived by an employer in favor of an applicant
who has demonstrated exceptional ability. A
certification explaining briefly the ground for
such waiver, and signed by the person in
charge of the program, shall be attached to the
apprenticeship agreement of the applicant
concerned. [Sec. 11, Rule VI, Book II, IRR]
Period of Apprenticeship
The period of apprenticeship shall not exceed
6 months.
Terms and conditions
Apprenticeship agreements, including the
wage rates of apprentices, shall conform to the
rules issued by the Secretary of Labor and
Employment.
Wage rate
Apprenticeship agreements providing for wage
rates below the legal minimum wage, which in
no case shall start below 75 percent of the
applicable minimum wage, may be entered into
only in accordance with apprenticeship
programs duly approved by the Secretary of
Labor and Employment. [Art. 61, as amended
by E.O. 111-1986]
Apprenticeship without compensation
The Secretary of Labor and Employment may
authorize the hiring of apprentices without
compensation whose training on the job is
required by the school or training program
curriculum or as requisite for graduation or
board examination. [Art. 72]
The wages of apprentices and learners shall in
no case be less than seventy-five percent
(75%) of the applicable minimum wage rates.
[Sec. 7, Wage Order No. NCR-19]
Investigation of violation of apprenticeship
agreement
Upon complaint of any interested person or
upon its own initiative, the appropriate agency
of the DOLE or its authorized representative
shall investigate any violation of an
apprenticeship agreement pursuant to such
rules and regulations as may be prescribed by
the Secretary of Labor and Employment. [Art.
65]
Appeal to the Secretary of Labor and
Employment
The decision of the authorized agency of the
DOLE may be appealed by any aggrieved
person to the SOLE within five (5) days from
receipt of the decision. The decision of the
Secretary of Labor and Employment shall be
final and executory. [Art. 66]
Exhaustion of administrative remedies
No person shall institute any action for the
enforcement of any apprenticeship agreement
or damages for breach of any such agreement,
unless he has exhausted all available
administrative remedies. [Art. 67]
Incentives for employers
An additional deduction from taxable income of
one-half (1/2) of the value of labor training
expenses incurred for developing the
productivity and efficiency of apprentices shall
be granted to the person or enterprise
organizing an apprenticeship program. [Art.
71]
Requisites of the deduction:
1. Apprenticeship program must be duly
approved by the DOLE;
2. Deduction shall not exceed 10% of
direct labor wage;
3. Employer must pay his apprentices the
minimum wage. [Art. 71]
Venue of Apprenticeship Programs
a. The plant, shop, premises of the
employer or firm concerned if the
apprenticeship program is organized by
an individual employer or firm.
b. The premises of one or several firms
designated for the purpose by the
organizer of the program if such
organizer is an association of
employers, civic groups and the like.
c. DOLE training center or other public
training institutions with which the
Bureau has made appropriate
arrangements
61
Summary of Rules:
1. The apprentice must be paid not less
than 75% of the prescribed minimum
salary [Art. 61]; HOWEVER, the
employer MAY NOT pay any wage if the
apprenticeship training is:
a. part of the school curriculum,
b. a requirement for graduation, or
c. a requirement for board
examination
2. The apprenticeship agreement must be
approved by the DOLE Secretary
(without such one shall be deemed a
regular employee);
3. The employer is not compelled to
continue one’s employment upon
termination of apprenticeship;
4. One-half (1/2) of the value of labor
training expenses incurred for
developing the productivity and
efficiency of apprentices of the training
cost is deducted from the employer’s
income tax, but it shall not exceed 10%
of direct labor wage.
Working scholars
There is no employer-employee relationship
between students on one hand, and schools,
colleges or universities on the other, where
there is written agreement between them under
which the former agree to work for the latter in
exchange for the privilege to study free of
charge, provided, the students are given real
opportunities, including such facilities as may
be reasonable and necessary to finish their
chosen courses under such agreement. [Sec.
14, Rule X, Book III, IRR]
Learners
Learners are persons hired as trainees in
semi-skilled and other industrial occupations:
1. Which are non-apprenticeable;
2. Which may be learned through practical
training on the job in a relatively short
period of time, which shall not exceed
three (3) months. [Art. 73; Sec 4(n), RA
7796]
2. The wages or salary rates of the
learners which shall begin at not less
than seventy-five percent (75%) of the
applicable minimum wage; and
3. A commitment to employ the learners if
they so desire, as regular employees
upon completion of the learnership. All
learners who have been allowed or
suffered to work during the first two (2)
months shall be deemed regular
employees if training is terminated by
the employer before the end of the
stipulated period through no fault of the
learners.
The learnership agreement shall be subject to
inspection by the Secretary of Labor and
Employment or his duly authorized
representative. [Art. 75]
Learners employed in piece or incentive-rate
jobs during the training period shall be paid in
full for the work done. [Art. 76]
Summary of Rules
1. The duration of learnership shall not
exceed 3 months [Art. 73];
2. If the learnership of 3 months is
completed, the employer may be
compelled to continue with the services
of the learner as a regular employee;
There is a commitment from the
employer to employ the learners if they
so desire, as regular employees upon
completion of the learnership;
3. If the learner is dismissed from service
without just and valid cause and without
due process after 2 months of service,
he will be deemed as regular employee;
[Art. 75(d)] and
4. The wages or salary rates of the
learners which shall begin at not less
than 75% of the applicable minimum
wage. [Art. 75(c)]
Distinctions between Learnership and
Apprenticeship

When may learners be hired Apprenticeship Learnership

1. No experienced workers are available;
2. The employment of learners being Highly technical Semi-skilled
necessary to prevent the curtailment of industries industrial occupations
employment opportunities; and
3. The employment will neither create Practical training Practical training
unfair competition in terms of labor costs supplemented by whether or not such
nor impair working standards. [Art. 74] related theoretical practical training is
instruction supplemented by
Terms and conditions of employment theoretical
Any employer desiring to employ learners shall instructions
enter into a learnership agreement with them,
which agreement shall include: Apprenticeable Non-apprenticeable
1. The duration of the learnership period, occupations occupations
which shall not exceed three (3) months;

62
approved by the Deductibility of ½ of No additional
SOLE training costs deduction from
incurred, provided: taxable income for
Written apprentice Learnership • Program is duly undertaking a
agreement ratified by agreement recognized by DOLE learnership
the appropriate • Deduction shall not agreement
committees exceed 10% of direct
labor wage
More than 3 months, Shall not exceed 3 • Payment of
shall not exceed 6 months minimum wage to
months apprentice
When apprentice When learner may be
may be hired: hired: g. Persons With Disabilities
1. The person is at 1. When no
least 15 years of age, experienced workers Persons with Disability
provided those who are available; Those suffering from restriction or different
are at least 15 years abilities, as a result of a mental, physical or
of age but less than 2. The employment sensory impairment, to perform an activity in
18 may be eligible for of learners is the manner or within the range considered
apprenticeship only necessary to prevent normal for a human being.
in non-hazardous curtailment of
occupation; employment Impairment
opportunities; and Any loss, diminution or aberration of
2. The person is psychological, physiological, or anatomical
physically fit for the3. The employment structure or function.
occupation in which does not create
he desires to be unfair competition in Disability
trained; terms of labor costs Means:
or impair or lower a. A physical or mental impairment that
3. The person working standards substantially limits one or more
possesses vocational psychological, physiological or
aptitude and capacity anatomical functions of an individual or
for the particular activities of such individual;
occupation as b. A record of such an impairment; or
established through c. Being regarded as having such an
appropriate tests; impairment.
and
Handicap
4. The person is able A disadvantage for a given individual, resulting
to comprehend and from an impairment or a disability that limits or
follow oral and prevents the function or activity that is
written instructions considered normal given the age and sex of
the individual.
Wage rate shall Wage rate shall
begin at not less than begin at not less than When Employable
75% of the minimum 75% of the minimum 1. their employment is necessary to
wage wage prevent curtailment of employment
opportunities;
No compensation if Learners in 2. does not create unfair competition in
SOLE authorizes, as piecework shall be labor costs; and
OJT is required by paid in full for the 3. does not impair or lower working
the school [Art. 72]. work done standards. (Labor Code, Art. 79)
The employer is not Learnership Handicapped workers may be hired as
compelled to agreement must apprentices or learners if their handicap is not
continue one’s contain a such as to effectively impede the performance
employment upon commitment to of job operation in the particular position for
termination of employ the learners if which they are hired.
apprenticeship they so desire, as
regular employees Handicapped Workers May Become Regular
upon completion of Employees - if their handicap is not such as to
the learnership effectively impede the performance of job

63
operations in the particular occupations for
which they were hired.
Employment Agreement; Contents
1. Names and addresses of the employer
and the handicapped worker
2. Rate of pay of the handicapped worker
which shall not be less than 75% of the
legal minimum wage
3. Nature of work to be performed by the
handicapped worker
4. Duration of the employment (Labor
Code, Art. 80)
Apprenticeship Opportunities
Disabled persons shall be eligible as
apprentices or learners: Provided, that:
1. Their handicap is NOT as much as to
effectively impede the performance of
job operations in the particular
occupation for which they are hired;
2. After the lapse of the period of
apprenticeship, if found satisfactory in
the job performance, they shall be
eligible for employment. [Art. 81; Sec.
7, RA 7277; Bernardo v. NLRC,
supra.]
a) Equal Opportunity for Employment
No disabled person shall be denied access to
opportunities for suitable employment.
Qualified disabled employees shall be subject
to same terms and conditions of employment
and the same compensation, privileges,
benefits, fringe benefits, incentives or
allowances as a qualified able-bodied person.
b) Reserved contractual positions
Five percent (5%) of all casual, emergency and
contractual positions in the DSWD; DOH,
DepEd; and other government agencies,
offices or corporations engaged in social
development shall be reserved for disabled
persons. [par. 2, Sec. 5, RA 7277]
c. Sheltered employment
The provision of productive work for disabled
persons through workshop providing special
facilities, income producing projects or
homework schemes. [Sec 4(i), RA 7277]
Purpose: To give them the opportunity to earn
a living thus enabling them to acquire a
working capacity required in open industry.
[Sec 4(i), RA 7277]
If suitable employment for disabled persons
cannot be found through open employment,
the State shall endeavor to provide it by means
of sheltered employment.
In the placement of disabled persons in
sheltered employment, it shall accord due
regard to the individual qualities, vocational
goals and inclinations to ensure a good
working atmosphere and efficient production.
[Sec 6, RA 7277]
What are the rights of PWDs?
Under the law, PWDs are entitled to equal
opportunity for employment. Consequently, no
PWD shall be denied access to opportunities
for suitable employment. A qualified employee
with disability 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.
What is the wage rate of PWDs?
The wage rate of PWDs is 100% of the
applicable minimum wage.
What is the wage rate of PWD if hired as
apprentice or learner?
A PWD hired as an apprentice or learner shall
be paid not less than seventy-five percent
(75%) of the applicable minimum wage.
1. Discrimination
a. Magna Carta for Disabled Persons (RA
7277)
What is the rule on discrimination against
employment of PWDs?
No entity, whether public or private, shall
discriminate against a qualified PWD 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. (RA
7277, Sec. 32)
A Qualified Individual with a Disability
means an individual with a disability who, with
or without reasonable accommodations, can
perform the essential functions of the
employment position that such individual
holds or desires. However, consideration shall
be given to the employer’s judgement as to
what functions of a job are essential, and if an
employer has prepared a written description
before advertising or interviewing applicants
for the job, this description shall be
considered evidence of the essential functions
of the job. (RA 7277, Sec. 4l)
The following constitute acts of
discrimination:
1. Limiting, segregating or classifying a
job applicant with disability in such a
64
 manner that adversely affects his work
opportunities;
2. Using qualification standards,
employment tests or other selection
criteria that screen out or tend to
screen out a PWD unless such
standards, tests or other selection
criteria are shown to be job-related for
the position in question and are
consistent with business necessity;
3. Utilizing standards, criteria, or methods
of administration
4. Have the effect of discrimination on the
basis of disability; or
5. Perpetuate the discrimination of others
who are subject to common
administrative control.
6. Providing less compensation, such as
salary, wage or other forms of
remuneration and fringe benefits, to a
qualified employee with disability, by
reason of his disability, than the amount
to which a non-disabled person
performing the same work is entitled;
7. Favoring a non-disabled employee
over a qualified employee with
disability with respect to promotion,
training opportunities, study and
scholarship grants, solely on account of
the latter’s disability;
8. Re-assigning or transferring an
employee with a disability to a job or
position he cannot perform by reason
of his disability;
9. Dismissing or terminating the services
of an employee with disability by
reason of his disability unless the
employer can prove that he impairs the
satisfactory performance of the work
involved to the prejudice of the
business entity; provided, however, that
the employer first sought to provide
reasonable accommodations for
persons with disability;
10. Failing to select or administer in the
most effective manner employment
tests which accurately reflect the skills,
aptitude or other factor of the applicant
or employee with disability that such
tests purports to measure, rather than
the impaired sensory, manual or
speaking skills of such applicant or
employee, if any; and
11. Excluding PWD from membership in
labor unions or similar organizations.
Occasions when a Disabled Applicant may
be Subjected to Medical Examination
Upon an offer of employment, a disabled
applicant may be subjected to medical
examinations, on the following occasions:
1. All entering employees are subjected to
such an examination regardless of
disability;
2. Information obtained during the
medical condition or history of the
applicant is collected and maintained
on separate forms and in separate
medical files and is treated as a
confidential medical record; Provided,
however, That:
a. Supervisors and managers may
be informed regarding
necessary restrictions on the
work or duties of the employees
and necessary
accommodations;
b. First aid and safety personnel
may be informed, when
appropriate, if the disability may
require emergency treatment;
c. Government officials
investigating compliance with
this Act shall be provided
relevant information on request;
and
d. The results of such examination
are used only in accordance
with this Act [Sec. 33, RA 7277].
b. Mental Health Act (RA 11036)
Mental Health Promotion in Educational
Institutions - Educational Institutions, such as
schools, colleges, universities, and technical
schools, shall develop policies and programs
for students, educators, and other employees
designed to: raise awareness on mental health
issues, identified and provide support and
services for individuals at risk, and facility
access, including referral mechanisms of
individual with mental health conditions to
treatment and psychosocial support.
All public and private educational institutions
shall be required to have a complement of
mental health professionals. (Sec. 24)
Mental Health Promotion and Policies in the
Workplace
Employers shall develop appropriate policies
and programs on mental health issues, correct
the stigma and discrimination associated with
mental conditions, identify and provide support
for individuals with mental health conditions to
treatment and psychosocial support. (Sec. 25)
Duties and Responsibilities of DOLE and
CSC
a. Develop guidelines and standards on
appropriate and evidence-based mental
health programs for the workplace as
described in this Act; and
b. Develop policies that promote mental
health in the workplace and address
65
 stigma and discrimination suffered by
people with mental health conditions
(Sec 35)

Sexual Harassment in the

Discrimination
Any distinction, exclusion or restriction which Work Environment
has the purpose or effect of nullifying the
recognition, enjoyment or exercise, on an a. Sexual Harassment Act (RA 7877)
equal basis with others, of all human rights and
fundamental freedoms in the political,
economic, social cultural, civil or any other Acts covered Demanding,
field. It includes all forms of discrimination, requesting or
including denial of reasonable accommodation. otherwise requiring
Special measure solely to protect the rights or any sexual favor from
secure the advancement of persons with the other, regardless
decision-making impairment capacity shall not of whether these are
be deemed to be discriminatory. [Section 4(e)] accepted by the
object of said Act
2. Incentives for Employers (Sec. 8, RA Committed by An employer,
7277) employee, manager,
supervisor, agent of
To encourage the active participation of the the employer,
private sector in promoting the welfare of teacher, instructor,
disabled persons and to ensure gainful professor, coach,
employment for qualified disabled persons, trainor, or any other
adequate incentives shall be provided to person who, having
private entities which employ disabled persons. authority, influence or
moral ascendancy
Private entities that employ disabled persons over another
who meet the required skills or qualifications,
either as regular employee, apprentice or Where In a work or training
learner, shall be entitled to an additional or education
deduction, from their gross income, equivalent environment
to 25% of the total amount paid as salaries and
wages to disabled persons.
Employment or Work-Related Sexual
Private entities that improve or modify their Harassment
physical facilities in order to provide 1. The sexual favor is made as a condition:
reasonable accommodation for disabled a. in the hiring or in the
persons shall also be entitled to an additional employment, re-employment or
deduction from their net taxable income, continued employment of said
equivalent to 50% of the direct costs of the individual; or
improvements or modifications. b. in granting said individual
favorable compensation, terms,
For establishments giving discounts – may conditions, promotions, or
claim such discounts as tax deductions based privileges; or
on the net cost of the goods sold or services c. in the refusal to grant the sexual
rendered: favor results in limiting,
a. The cost of the discount shall be segregating or classifying the EE
allowed as deduction from gross income which in any way would
for the same taxable year that the discriminate, deprive or diminish
discount is granted employment opportunities or
b. The total amount of the claimed tax otherwise adversely affect said
deduction net of VAT if applicable, shall employee;
be included in their gross sales receipts 2. The above acts would either:
for tax purposes and shall be subject to a. impair the employee’s rights or
proper documentation and to the privileges under existing labor
provisions of the National Internal laws; or
Revenue Code, as amended. [Sec. 32, b. result in an intimidating, hostile,
RA 7277, as amended by RA 9442] or offensive environment for the
employee. [Sec. 3, RA 7877]

66
It is not necessary that a demand, request or
requirement of sexual favor be articulated in a
categorical oral or written statement. It may be
discerned, with equal certitude, from acts of the
offender. (Domingo v. Rayala, G.R. No.
155831)
Duty of Employer
1. Promulgate appropriate rules and
regulations prescribing the procedure for
investigation of sexual harassment
cases as well as guidelines on proper
decorum in the workplace.
2. Create a committee on decorum and
investigation of cases on sexual
harassment. (Sec. 4)
Liability of Employer / Head of Office
Solidarily liable for damages arising from the
acts of sexual harassment committed in the
employment, education or training environment
if the employer is informed of such acts by the
offended party and no immediate action is
taken.
Prescriptive period to file action: 3 years
(Sec. 7)
b. Safe Spaces Act (Article IV of RA 11313
only; Exclude: Liability of Employers)
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: 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
d. Information and communication system
refers to a system for generating,
sending, receiving, storing or otherwise
processing electronic data messages or
electronic documents and includes the
computer system or other similar
devices by or in which data are recorded
or stored and any procedure related to
the recording or storage of electronic
data messages or electronic documents.
(Sec. 16, Art. IV, RA 11313)
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 harassment in the workplace. Towards
this end, the employer or person of authority,
influence or moral ascendancy shall:
a. Disseminate or post in a conspicuous
place a copy of this Act to all persons in
the workplace;
b. Provide measures to prevent
gender-based sexual harassment in the
workplace, such as the conduct of
anti-sexual harassment seminars;
c. Create an independent internal
mechanism or a committee on decorum
and investigation to investigate and
address complaints of gender-based
sexual harassment which shall:
i. Adequately represent the
management, the employees
from the supervisory rank, the
rank-and-file employees, and the
union, if any;
ii. Designate a woman as its head
and not less than half of its
members should be women;
iii. Be composed of members who
should be impartial and not
connected or related to the
alleged perpetrator;
iv. Investigate and decide on the
complaints within ten (10) days or
less upon receipt thereof;
v. Observe due process;
vi. Protect the complainant from
retaliation; and
vii. Guarantee confidentiality to the
greatest extent possible;
d. Provide and disseminate, in consultation
with all persons in the workplace, a code
of conduct or workplace policy which
shall:
i. Expressly reiterate the prohibition
on gender-based sexual
harassment;
ii. Describe the procedures of the
internal mechanism created
67
 under Section 17(c) of this Act;
and
iii. Set administrative penalties.
(Sec. 17, Art. IV, RA 11313)
Duties of Employees and Co-workers
a. Refrain from committing acts of
gender-based sexual harassment;
b. Discourage the conduct of
gender-based sexual harassment in the
workplace;
c. Provide emotional or social support to
fellow employees, co-workers,
colleagues or peers who are victims of
gender-based sexual harassment; and
d. Report acts of gender-based sexual
harassment witnessed in the workplace.
Social Welfare Legislation
1. SSS Law (RA 8282, as amended by RA
11199)
a. Coverage
i. Compulsory
(1) Employees not over 60 years old and
their employers, including domestic helpers
[Sec. 9(1), RA 11199]
Provided, That any benefit already earned by
the employees under private benefit plans
existing at the time of the approval of this Act
shall not be discontinued, reduced or otherwise
impaired.
Private plans which are existing and in force at
the time of compulsory coverage shall be
integrated with the plan of the SSS, in such a
way where the employer’s contribution to his
private plan is more than required of him in this
Act:
a. He shall pay to the SSS only the
contribution required of him; and
b. He shall continue his contribution to
such private plan less his contribution to
the SSS
c. So that the employer’s total contribution
to his benefit plan and to the SSS shall
be the same as his contribution to his
private benefit plan before the
compulsory coverage. [Sec. 9(1), RA
11199]
Domestic workers or “kasambahays” as
defined under RA10361 or the Batas
Kasambahay, who are receiving a monthly
income lower than minimum salary credit
prescribed under this Act, shall pay
contributions based on their actual monthly
salary. [Sec. 4(a)(9), RA 11199]
(2) Self-employed persons as may be
determined by the Commission, including
but not limited to:
a. All self-employed 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” under Sec. 8 (d) of
this Act;
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 an employer and employee at
the same time. [Sec 8(d), RA 11199]
d. Professional atheism coaches, trainers
and jockeys e. Individual farmers and
fishermen [Sec. 9-A, RA11199]
(3) All sea-based and land-based Overseas
Filipino Workers (OFWs) not over 60 years
of age [Sec. 9-B, RA 11199]
ii. Voluntary
1. Spouses who devote full time to
managing household and family affairs,
unless they are also engaged in another
vocation or employment (in which case,
coverage will be mandatory). [Sec. 9(b),
RA 11199]
2. Employees previously under compulsory
coverage) already separated from
employment or those self-employed
(under compulsory coverage) with no
realized income for a given month, who
chose to continue with contributions to
maintain the right to full benefit. [Sec.
11, RA 11199]
3. Self-employed members realizing no
income in any given month, who choose
to continue paying contributions under
the same rules and regulations
applicable to a separated employee
member. [Sec. 11-A, RA 11199]
Note: Foreign governments and international
organizations 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 civil
service retirement system. [Sec. 8(j)(3), RA
11199]
68

iii. Exclusions
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
instrumentalities; and
Note: Foreign governments and
international organizations may enter
into an agreement with the PH
government to include their employees
in the Philippines in the SSS.
4. Services performed by temporary and
other employees which may be
excluded by regulation of the Social
Security Commission. Employees of
bona fide independent contractors shall
not be deemed employees of the
employer engaging the services of said
contractors. [Sec. 8(j), RA 11199]
b. Dependents and Beneficiaries
Primary
1. Dependent spouse - until remarriage
2. Dependent children [legitimate,
legitimated, legally adopted and
illegitimate] - Illegitimate children are
entitled only to 50% of the share of
legitimate children. Where there are no
legitimate children, the illegitimate
children get 100%.
Secondary
1. Receives only when the primary
beneficiaries are absent
2. Dependent parents
Others
1. Receives only when primary and
secondary beneficiaries are absent
2. Any other person designated by
member as his/her secondary
beneficiary. [Sec. 8 (k), RA 11199]
c. Benefits
a. Monthly Pension [Sec. 12, RA 11199]
The monthly pension shall be the highest of the
following amounts:
1. P300 + [20% x (average monthly credit)]
+ [2% x (average monthly credit) x (# of
cash credit years of service in excess of
10 years)]
2. 40% x [average monthly credit]
3. P1000, provided that the monthly
pension shall in no case be paid for an
aggregate amount of less than 60
months [Sec. 12 (a)]
4. Notwithstanding the above mentioned,
minimum pension is:
a. P1,200 - members with at least
10 years credit service
b. P 2,400 - members with at least
20 years
b. Dependents' Pension [Sec. 12- A, RA
11199]
1. Paid on account of members’
a. Death
b. Permanent total disability, or
c. Retirement
2. Paid to each child conceived on or prior
to contingency, but not exceeding 5,
beginning with the youngest and
preferring the legitimate
3. Amount is either P250 or 10% of the
monthly pension as computed above,
whichever is higher.
c. Retirement benefits [Sec. 12-B, RA 11199]
Requisites for Eligibility
1. 120 monthly contributions
2. Age
a. Has reached the age of 60 years
and is already separated from
employment or has ceased to be
self-employed; or
b. Has reached the age of 65 years
Period of entitlement - From retirement until
death
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.
In Case of Death of Member
1. His/her primary beneficiaries as of the
date of his/her retirement shall be
entitled to receive the monthly pension;
2. If he/she has no primary beneficiaries
AND he/she dies within 60 months from
the start of his/her monthly pension,
his/her secondary beneficiaries shall be
entitled to a lump sum benefit equivalent
to the total monthly pensions
corresponding to the balance of the 5
year guaranteed period, excluding the
dependents’ pension.
Lump Sum Alternative
The member may opt to receive the first 8
monthly pensions in lump sum but such is
discounted at a preferential rate of interest to
be determined by the SSS.
Lump Sum Eligibility (Equal to total
contributions)
69
A covered member who is 60 years old at
retirement and who does not qualify for
pension benefits (see requisites for eligibility)
shall be entitled to a lump sum benefit equal to
the total contributions paid by him and on his
behalf: Provided, That he is separated from
employment and is not continuing payment of
contributions to the SSS on his own.
Monthly pension
The monthly pension of a member who retires
after reaching age 60 shall be the highest 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.
d. Permanent disability benefits [Sec. 13-A,
RA 11199]
Eligibility
1. 36 monthly contributions prior to the
semester of disability
Note: This is the same as death benefit,
but permanent disability pension is paid
directly to the member.
2. In case the permanently disabled
member dies, he/she is given the same
treatment as a retiree dying.
3. For permanent partial disability, the
pension is not lifetime. It shall be paid in
lump sum if the period is less than 12
months.
4. For multiple partial disabilities, they shall
be additive when related or deteriorating
- the percentage shall be equal to the
number of months the partial disability is
entitled to, divided by 75 months.
Lump Sum Alternative
A member is entitled to a lump sum benefit
equivalent to the monthly pension x number of
monthly contributions paid to the SSS or 12
times the monthly pension, whichever is higher.
To be entitled, he must not have paid at least
36 monthly contributions.
Subject to compulsory coverage again
A member who:
1. Received a lump sum benefit, and
2. If re-employed or resumed
self-employment not earlier than 1 year
from date of disability , shall be subject
to compulsory coverage and considered
a new member.
Death of Member
1. His/her primary beneficiaries as of the
date of his/her retirement shall be
entitled to receive the monthly pension;
2. If he/she has no primary beneficiaries
AND he/she dies within 60 months from
the start of his/her monthly pension,
his/her secondary beneficiaries shall be
entitled to a lump sum benefit equivalent
to the total monthly pensions
corresponding to the balance of the 6
year guaranteed period, excluding the
dependents’ pension.
e. Death Benefits [Sec. 13, RA 11199]
Eligibility
36 monthly contributions prior to the semester
of death
Benefit
1. Monthly pension to primary
beneficiaries, or
2. If no primary beneficiaries, lump sum
equivalent to 36 times the monthly
pension to secondary beneficiaries
If ineligible/has not paid 36 monthly
contributions
A lump sum benefit which shall be that which is
higher between the ff. will be given to the
beneficiaries:
a. (monthly pension) x 12, or
b. (monthly pension) x (# of monthly
contributions)
f. Funeral benefits
P12,000 in cash or in kind, upon the death of
member.
g. Loan
Social Security Commission Reso. No. 669,
SSS Circular No. 21-P and 52 pertain to
treatment of salary loans, which sometimes
provide for more flexible payment terms or
condonation for delinquent payers.
h. Sickness benefits [Sec. 14, RA 11199]
Eligibility
1. Inability to work due to sickness or
injury,
2. Confined for more than 3 days either in
a hospital or elsewhere with SSS
approval
3. At least 3 months of contribution paid in
the 12 month period immediately before
the semester of sickness or injury
4. All company sick leaves with pay for the
current year have been used up;
5. Maximum of 120 days per 1 calendar
year (i.e. max permissible for the same
sickness and confinement is 240 days
for 2 consecutive years)
70
 6. Employer has been notified, or, if a
separated, voluntary or self-employed Coverage
member, the SSS has been directly Covers only the first four deliveries or
notified within 5 days from confinement. miscarriages.

Note: Notice to employers or SSS is not Employer’s reimbursement

needed when confinement is in a hospital.
Note: Notice to employer is not required when
employee became sick or injured while working
or within the premises of the employer.
Benefit
Daily cash allowance paid for the number of
days a member is unable to work due to
sickness of injury equivalent to 90% x (average
daily salary credit)
Full payment shall be advanced by the
employer within 30 days from filing the
maternity leave application.
SSS shall reimburse the employer of 100% of
the amount of maternity benefits advanced
upon receipt of satisfactory proof of payment
and legality thereof.
Note: All benefits herein mentioned are
tax-exempt.

Reimbursement of SSS to Employer j. Unemployment Insurance or Involuntary

Upon satisfactory proof of payment and legality
of sickness benefits, reimbursement shall be
made by the SSS if the following conditions are
met:
1. Employer notified SSS of the
confinement within 5 calendar days after
receipt of the notification from the
employee-member - 100%
reimbursement
2. If the notification to SSS is made
beyond 5 calendar days after receipt of
notification from the employee-member -
reimbursement only for each day of
confinement starting from the 10th
calendar day immediately preceding the
date of notification to SSS
SSS shall reimburse the employer or pay the
unemployed member only for confinement
within the 1 year period immediately preceding
the date the claim for benefit/reimbursement is
received by SSS.
XPN: Confinement in a hospital - the claim for
benefit or reimbursement must be filed within 1
year from the last day of confinement
Separation Benefits [Sec. 14-B, RA 11199]
Eligibility
1. Not over 60 years of age
2. At least 36 months contributions, 12
months of which should be in the 18th
month period immediately preceding the
involuntary unemployment or separation
Benefit
Monthly cash payments equivalent to 50% of
the average monthly salary credit for a
maximum of 2 months
Frequency of claiming benefit
An employee who is involuntarily unemployed
can only claim unemployment benefits once
every 3 years.
In case of concurrence of 2 or more
compensable contingencies, only the highest
benefit shall be paid, subject to the rules and
regulations that the Commission may
prescribe.
2. GSIS Law (RA 8291)

i. Maternity Leave benefits [Sec. 14-A, RA a. Coverage

11199] Coverage: All public sector employees below
the compulsory retirement age of 65,
Eligibility irrespective of employment status. [Sec. 3]
1. Female member
2. Paid at least 3 monthly contributions in Exclusions
the 12-month period immediately 1. AFP and PNP
preceding the semester of her childbirth 2. Members of the Judiciary and
or miscarriage Constitutional Commissions who are
3. Member notified her employer of her covered only by life insurance as they
pregnancy and probable date of have separate retirement schemes
childbirth, which notice shall be 3. Contractual employees with no
transmitted to the SSS employer-employee relationship [Sec.
3]
Full payment shall be advanced by the
employer within 30 days from filing the
maternity leave application.

71
b. Dependents and Beneficiaries 1. 60 years of age
Primary 2. Who have rendered at least 15 years of
1. Dependent spouse - until remarriage service
2. Dependent children (legitimate,
legitimated, legally adopted and If employee has less than 15 years of service,
illegitimate) he may be allowed to continue in accordance
with civil service laws. [Sec. 13-A]
Note: Unlike the SSS law, the GSIS law does
not distinguish between the share of legitimate Benefit
and illegitimate children The member may choose between
1. 60 x (basic monthly pension) lump sum
Secondary payment at the time of retirement +
In the absence of primary beneficiaries, basic monthly pension payable monthly
1. Dependent parents for life after expiry of the 5-year
2. Legitimate descendants (excluding guaranteed period which is already
dependent children) covered by the lump sum, or
2. Cash payment equal to 18 x (basic
c. Benefits monthly pension) + monthly pension for
life immediately but with no 5-year
Computation of service guarantee [Sec. 13]
From the date of original appointment/election
including periods of service at different times c. Permanent Disability Benefits
under 1 or more employers, those performed
overseas under the authority of the Republic of Total and Partial and
the Philippines, and those that may be Permanent [Sec. 16] Permanent [Sec. 17]
prescribed by the GSIS in coordination with the
Civil Service Commission. 1. Complete loss of 1. Complete and
sight of both eyes permanent loss of the
In case of reinstatement in the service of an 2. Loss of 2 limbs at use of
employer and subsequent retirement or or above the ankle or a. Any finger
separation which is compensable under this wrist b. Any toe
Act, all service credited for retirement, 3. Permanent c. One arm
resignation or separation for which complete paralysis of d. One hand
corresponding benefits have been awarded 2 limbs e. One foot
under this Act or other laws shall be excluded 4. Brain injury f. One leg
in the computation. resulting in incurable g. One/both ears
imbecility or insanity h. Hearing of
GSIS may prescribe rules for the inclusion of 5. Other cases as one/both ears
part time and other services with determined by GSIS i. Sight of one eye
compensation. [Sec. 10]
2. Other cases as
a. Monthly Pension determined by GSIS
The amount shall be [37.5% x (revalued
average monthly compensation)] + [2.5 x
(revalued average monthly compensation) x Eligibility for Permanent Total Disability
(years in service in excess of 15 years)] 1. Disability not due to employee’s own
grave misconduct, notorious negligence,
Provided, the monthly pension shall not exceed habitual intoxication, or willful intention
90% of the average monthly compensation. to kill himself for another [Sec. 15]
2. Employee is:
It shall not be less than P24,000 for those with a. In service at time of disability
20 years of service and not less than P1,300 b. Even if separated, has paid at
for everyone else. [Sec. 9] least 36 monthly contributions
within the 5-year period
b. Retirement Benefits immediately prior to disability or
Eligibility has paid a total of at least 180
1. At least 15 years of service monthly contributions prior to
2. At least 60 years of age disability
3. Not receiving pension benefit from c. Not enjoying old-age retirement
permanent total disability [Sec. 13] benefit [Sec. 16]

Compulsory Retirement
Retirement is compulsory for employees:

72
Benefit for Permanent Total Disability
1. Monthly income benefit for life equal to
basic monthly pension, from date of
disability
2. If member is in service at time of
disability and has paid at least 180
monthly contributions, he receives an
additional cash payment of 18 x basic
monthly pension
Ineligible members
If member has rendered at least 3 years of
service, he shall receive cash payment equal
to 100% of average monthly compensation for
each year of service (essentially total amount
of contributions made) or P12,000 whichever is
higher [Sec. 16].
Partial Disability
Paid according to GSIS prescribed schedule.
Members must satisfy conditions regarding the
disability not being due to his own fault and
regarding employment status and services
rendered.
d. Death benefits [Sec. 21]
When member dies, the primary beneficiaries
are entitled to only ONE of the following:
1. Survivorship pension
a. He was in service when he died,
or
b. Even if separated from service,
he has at least 3 years of service
and has paid 36 monthly
contributions within the 5 years
preceding death, or
c. Even if separated from the
service, he has paid 180 monthly
contributions prior to death.
2. Survivorship pension + cash payment of
100% of average monthly compensation
for every year of service [pension + total
contributions made]
a. He was in service when he died,
and
b. With 3 years of service
3. Cash payment equivalent to 100%
average monthly compensation for each
year of service he paid contributions or
P12,000 whichever is higher:
a. With 3 years of service
b. He has failed to qualify in the
prior 2 schemes.
e. Funeral Benefits [Sec. 23]
Eligibility
1. Active member
2. Member separated from service but still
entitled to the benefit
3. Pensioner
4. Retiree who at time of retirement was of
pensionable age but opted to retire
under RA 1616
f. Loan
The following are the loans provided:
1. Consolidated Loan
2. Policy loan
3. Emergency loan
4. Pension loan
g. Temporary Disability Benefits [Sec. 18]
Eligibility
1. Employee must be:
a. In service at time of disability, or
b. If separated, he has rendered at
least 3 years of service and paid
at least 6 monthly contributions in
the 12 month period immediately
prior to disability
2. All sick leave credits including those in
the CBA for the current year have been
used
3. Maximum of 120 days per 1 calendar
year
Benefit
75% x current daily compensation for every
day or fraction thereof of disability OR P70.00,
whichever is higher
h. Separation Benefits
Eligibility and benefit received
1. 60 years of age, or separation from
service with at least 3 years but not over
15 years served – cash payment of
100% of ave. monthly compensation for
each year of service (total amount of all
contributions paid) or P12,000
whichever is higher
2. Below 60 years of age, but at least 15
years of service rendered – cash
payment of 18 x (monthly pension) at
time of resignation/separation + old age
pension benefit (equal to basic monthly
pension) [Sec. 11]
i. Unemployment Benefits [Sec. 12]
Eligibility
1. Employee separated from service due to
abolition of his office or position and
2. Employee has been paying integrated
contributions for at least 1 year prior to
separation
Benefit
Monthly cash payments of 50% x average
monthly compensation for a duration which is
proportional to years rendered, ranging from 2
to 6 months.
73
j. Survivorship Benefits
Benefit
1. Basic survivorship pension - 50% x
basic monthly pension (see Death
Benefits) and
2. Dependent children’s pension not
exceeding 50% of the basic monthly
pension
k. Life Insurance Benefits
Members of the Judiciary and Constitutional
Commissions are only entitled to life insurance.
3. Disability and Death Benefits
a. Labor Code
Under the Labor Code, employees'
compensation (EC) benefits are granted to
employees or their dependents for
work-connected disability or death, or those
resulting from accident arising out of and in the
course of employment. [Art. 166, LC in rel. to
Sec. 1, Rule III, IRR]
Types of disability
1. Temporary Total Disability [Art. 197]
2. Permanent Total Disability [Art. 198]
3. Permanent Partial Disability [Art. 199]
a. Disability Benefits
Disability does not refer to the injury nor to the
pain and suffering it has occasioned, but to the
loss and impairment of earning capacity. There
is disability when there is a loss or diminution
of earning power because of actual absence
from work due to injury or illness arising out of
and in the course of employment. The basis of
compensation is reduction of earning power.
[Azucena, 2016]
TEMPORARY TOTAL DISABILITY
A total disability is 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
[Art. 197 in rel. to Sec. 2(a), Rule VII,
Amended Rules on Employees’
Compensation].
The object of the law in allowing compensation
during temporary disability is to compensate
the laborer or employee for what he might have
earned during the period of the treatment of his
injury. [Cañete v. Insular Lumber Co., G.R.
No. 42175]
Amount of benefit
An employee suffering from temporary total
disability shall be paid by the System an
equivalent of ninety percent (90%) of the
average salary credit, provided:
1. The daily income benefit is not less than
Ten (10) pesos nor more than Ninety
(90) pesos, nor paid for a continuous
period longer than 120 days. [Art. 197]
2. The monthly income benefit shall be
suspended if the employee fails to
submit a monthly medical report certified
by its attending physician [Art.194]
Period of Entitlement
The employee is entitled to the benefit from the
day of the start of the disability. It shall not be
paid longer than 120 consecutive days except
where such injury or sickness still requires
medical attendance beyond 120 days but not
to exceed 240 days from onset of disability.
When after the period of temporary total
disability had ceased, an employee was found
to be suffering from a permanent partial
disability, he was entitled to an award based
upon partial disability permanent in character.
[Cañete v. Insular Lumber Co., G.R. No.
42175]
PERMANENT TOTAL DISABILITY
A disability is total and 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. [Art.
198 in rel. to Sec. 2(b), Rule VII]
1. Authorized Causes (also known as
“Business-related Causes”)
a. The installation of labor-saving
devices,
Requisites
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;
4. There is no other option available to
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.
GR: In cases of installation of labor-saving
devices, redundancy and retrenchment, the
Last-In, First-Out Rule shall apply.
74
 In the case of Dagasdas v. Grand
Placement and General Services
Corporation. [G.R. No. 205727], the
Supreme Court laid down the following rules:
1. The company-designated physician
must issue a final medical assessment
on the seafarer's disability grading within
a period of 120 days from the time the
seafarer reported to him;
2. If the company-designated physician
fails to give his assessment within the
period of 120 days, without any
justifiable reason, then the seafarer's
disability becomes permanent and total;
3. If the company-designated physician
fails to give his assessment within the
period of 120 days with a sufficient
justification (e.g. seafarer required
further medical treatment or seafarer
was uncooperative), then the period of
diagnosis and treatment shall be
extended to 240 days. The employer
has the burden to prove that the
company-designated physician has
sufficient justification to extend the
period; and
4. If the company-designated physician still
fails to give his assessment within the
extended period of 240 days, then the
seafarer's disability becomes permanent
and total, regardless of any justification.
It must be emphasized that the
company-designated physician must:
1. Issue a final medical assessment of the
seafarer's medical condition; and
2. Give his assessment to the seafarer
concerned.
That is to say that the seafarer must be fully
and properly informed of his medical condition.
The results of his/her medical examinations,
the treatments extended to him/her, the
diagnosis and prognosis, his/her disability
grading must be fully explained to him/her by
no less than the company-designated
physician.
The company-designated physician is
mandated to issue a medical certificate, which
should be personally received by the seafarer,
or, if not practicable, sent to him/her by any
other means sanctioned by present rules.
To require the seafarer to seek the decision of
a neutral third-party physician without primarily
being informed of the assessment of the
company-designated physician is a clear
violation of the tenets of due process.
Amount of Benefit
The employee suffering from a permanent total
disability shall be entitled to an amount
equivalent to the monthly income benefit, plus
ten percent thereof for each dependent child,
but not exceeding five, beginning with the
youngest and without substitution: Provided,
That the monthly income benefit shall be the
new amount of the monthly benefit for all
covered pensioners. [Art. 198]
Period of Entitlement
An employee with permanent total disability
shall be entitled to receive benefits monthly for
five (5) years.
However, Art. 198(b) provides that the benefits
may be suspended if the employee is gainfully
employed, or recovers from his permanent total
disability, or fails to present himself for
examination at least once a year.
PERMANENT PARTIAL DISABILITY
A disability is partial and permanent 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. [Art. 199 in rel. to Sec.
2(c), Rule VII, Amended Rules on
Employees’ Compensation].
The object of the law in granting compensation
for a permanent partial disability is to
compensate the injured laborer or employee
for the actual and permanent loss of a member
of the body, or the use thereof. [Cañete v.
Insular Lumber Co., G.R. No. 42175]
Amount of benefits
For an employee who has suffered a
permanent partial disability, the amount of
benefits, as well as the period of entitlement to
receive such benefits is based upon the degree
of disability, as well as the lost body part. The
body parts and the corresponding period of
equivalent disability are specified in Art 199.
75
 199(b) the same monthly income benefit shall
Table of benefits [Art. 199(b)] be paid for a period equivalent to the sum of
the periods established for the loss of the
member or the part thereof. If the result is a
Body part/s Number of months
decimal fraction, the same shall be rounded off
One thumb 10 to the next higher integer [Art. 199(e)].

One index finger 8 In cases of injuries or illnesses resulting in a

permanent partial disability not listed in the Art.
One middle finger 6 199(b), the benefit shall be an income benefit
equivalent to the percentage of the permanent
One ring finger 5 loss of the capacity to work [Art. 199(f)].
One little finger 3
Distinguished from permanent total
One big toe 6 disability
While “permanent total disability” invariably
One toe 3 results in an employee’s loss of work or
inability to perform his usual work, “permanent
One arm 50 partial disability,” on the other hand, occurs
when an employee loses the use of any
One hand 39 particular anatomical part of his body which
disables him to continue with his former work.
One foot 31 [Vicente v. ECC, G.R. No. 85024]
One leg 46
Conversion from permanent partial
One ear 10 disability to permanent total disability
A person’s disability may not manifest fully at
Both ears 20 one precise moment in time but rather over a
period of time. It is possible that an injury which
Hearing of one ear 10 at first was considered partial disability may
become totally and permanently disabled from
Hearing of both ears 50 the same cause. There is nothing in the law
that prohibits the conversion of permanent
Sight of one eye 25
partial disability benefit to permanent total
disability benefit, if it is shown that the
Notes: employee’s ailment qualifies as such. [GSIS v.
1. A loss of a wrist shall be considered as Court of Appeals and R. Balais, G.R. No.
a loss of the hand, and a loss of an 117572].
elbow shall be considered as a loss of
the arm. When salary is higher after the injury
2. A loss of an ankle shall be considered In a case where the employee filed a claim for
as loss of a foot, and a loss of a knee permanent partial disability but the ECC denied
shall be considered as a loss of the leg. the claim because in fact his salary was higher
3. A loss of more than one joint shall be than before, the Court ruled that the fact of
considered as a loss of one-half of the higher earning capacity fact would not in itself
whole finger or toe: Provided, That such necessarily affect the laborer’s claim for
a loss shall be either the functional loss compensation for a permanent partial disability.
of the use or physical loss of the The amount of his salary may be affected by
member. [Art. 199(c)] various extraneous matters or factors. [Central
Azucarera Don Pedro v. C. de Leon, in his
In case of permanent partial disability less than capacity as Workmen’s Compensation
the total loss of the member specified in Art. Commissioner and L. Alla, G.R. No.
199(b), the same monthly income benefit shall L-10036].
be paid for a portion of the period established
for the total loss of the member, in accordance b. Death Benefits
with the proportion that the partial loss bears to
the total loss. If the result is a decimal fraction, Monthly Income Benefit
the same shall be rounded off to the next Under such regulations as the Commission
higher integer [Art. 199(d)]. may approve, the System shall pay to the
primary beneficiaries:
In cases of simultaneous loss of more than one
member or a part thereof as specified in Art.

76
1. Upon the death of the covered employee
under this Title:
a. An amount equivalent to his monthly
income benefit;
b. Plus 10% thereof for each dependent
child, but not exceeding five, beginning
with the youngest and without
substitution, except as provided for in
par. (j) of Article 167 hereof: Provided,
That –
i. The monthly income benefit shall
be guaranteed for five years;
ii. If he has no primary beneficiary,
the System shall pay to his
secondary beneficiaries the
monthly income benefit but not to
exceed sixty months; and
iii. The minimum death benefit shall
not be less than fifteen thousand
pesos. (As amended by Section
4, Presidential Decree No. 1921).
2. Upon the death of a covered employee
who is under permanent total disability
under this Title: 80% of the monthly income
benefit and his dependents to the dependents’
pension: Provided, That –
a. The marriage must have been validly
subsisting at the time of disability;
b. If he has no primary beneficiary, the
System shall pay to his secondary
beneficiaries the monthly pension
excluding the dependents’ pension, of
the remaining balance of the five-year
guaranteed period; and
c. The minimum death benefit shall not be
less than fifteen thousand pesos. (As
amended by Section 4, Presidential
Decree No. 1921)
Note: The monthly income benefit provided
herein shall be the new amount of the monthly
income benefit for the surviving beneficiaries
upon the approval of this decree. [Art. 200 (a)-
(c)]
Condition to entitlement
The beneficiaries of a deceased employee
shall be entitled to an income benefit if all of
the following conditions are satisfied:
1. The employee has 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. [Sec. 1(a), Rule XIII,
IRR]
Notes:
1. 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.
2. In addition, the cause of death must be
a complication or natural consequence
of the compensated Permanent Total
Disability. [Sec. 1(b), Rule XIII, IRR]
Beneficiaries
The beneficiaries are:
1. Primary beneficiaries:
a. Dependent spouse until he/she
remarries;
b. Dependent children (legitimate,
legitimated, natural-born, or
legally adopted).
2. Secondary beneficiaries:
a. Illegitimate children and
legitimate descendants;
b. Parents, grandparents,
grandchildren. [Azucena, 2016]
Dependents
"Dependent" means:
1. The legitimate, legitimated or legally
adopted or acknowledged natural child
who is:
a. Unmarried,
b. Not gainfully employed, and
c. Not over twenty-one (21) years of
age or over twenty-one (21)
years of age provided he is
incapacitated and incapable of
self-support due to a physical or
mental defect which is congenital
or acquired during minority;
2. The legitimate spouse living with the
employee and the parents of said
employee wholly dependent upon him
for regular support. [Art. 173(i)]
The test of dependency is not merely whether
the contributions were necessary to bare
subsistence. Dependency may exist if such
contributions were relied on by claimant for
his/her means of living as determined by
his/her position in life. [Malate Taxicab v. Del
Villar, G.R. No. L-7489]
Period of entitlement
a. For primary beneficiaries
The income benefit shall be paid beginning at
the month of death and shall continue to be
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paid for as long as the beneficiaries are entitled
thereto. [Sec. 2, Rule XII, IRR]
b. For secondary beneficiaries
The income benefit shall be sixty (60) times the
monthly income benefit of a primary beneficiary
which in no case be less than P 15,000.00,
which shall likewise be paid in monthly
pension. [Sec. 2(a), Rule XII, IRR]
Manner of payment
Death benefits are paid in the form of cash
monthly pension:
1. For life to the primary beneficiaries,
guaranteed for five years;
2. For not more than 60 months to the
secondary beneficiaries in case there
are no primary beneficiaries;
3. In no case shall the total benefit be less
than P15,000. [Art. 200]
Amount of benefits
a. For primary beneficiaries
Monthly income benefit shall be equivalent to
the monthly income benefit for permanent total
disability, which shall be guaranteed for five
years, increased by ten percent for each
dependent child but not exceeding 5, beginning
with the youngest and without substitution.
[Sec. 3, Rule XII, IRR]
Notes:
1. The aggregate monthly benefit payable
in the case of the GSIS shall in no case
exceed the monthly wage or salary
actually received by the employee at the
time of his death;
2. The minimum income benefit shall not
be less than Fifteen Thousand Pesos
(P15,000.00). [Sec. 3, Rule XII, IRR]
b. For secondary beneficiaries
Income benefit is payable in monthly pension
which shall not exceed the period of 60 months
and the aggregate income benefit shall not be
less than P15, 000.00. [Sec. 3, Rule XII, IRR]
Death benefits after retirement are allowed
Generally, the term “covered employees” refers
to an employee who, at the time of his death, is
still covered by the GSIS. However, the
implementing rules and regulations of the
Employees’ Compensation Commission allows
death benefits to those retired employees
whose retirement was brought about by
permanent disability.
The Court is aware that death benefits must be
granted to the primary beneficiaries of the
decedent to help the family of a permanent and
totally disabled person who was so disabled
because of causes that are work-oriented. The
rule applies all the more when the disabled
person later dies because of the same cause
or related cause. [Manuzon v. ECC, G.R. No.
88573]
Death of a person receiving permanent total
disability benefits
Under Art. 200(b), death benefit shall be paid
to the beneficiaries if an employee, while
receiving permanent total disability benefit,
dies.
Prescription of claims
All money claims arising from
employer-employee relations shall be filed
within three (3) years from the time the cause
of action accrued; otherwise they shall forever
be barred. [Art. 306]
b. POEA-Standard Employment Contract
As part of a seafarer's deployment for overseas
work, he and the vessel owner or its
representative local manning agency are
required to execute the POEA-SEC.
Containing the standard terms and conditions
of seafarers' employment, the POEA-SEC is
deemed included in their contracts of
employment in foreign ocean-going vessels
[Sharpe Sea Personnel Inc. v. Mabunay,
G.R. No. 206113].
a. Compensation for Benefits for Injury or
Illness
Medical Expenses
If the injury or illness requires medical and/or
dental treatment in a foreign port, the employer
shall be liable for the full cost of such medical,
serious dental, surgical and hospital treatment
as well as board and lodging until the seafarer
is declared fit to work or to be repatriated.
However, if after repatriation, the seafarer still
requires medical attention arising from said
injury or illness, he/she shall be so provided at
cost to the employer until such time he/she is
declared fit or the degree of his/her disability
has been established by the
company-designated physician [Sec. 20, A.2,
POEA-SEC].
Sickness Allowance
The seafarer shall also receive sickness
allowance from his/her employer in an amount
equivalent to his/her basic wage computed
from the time he/she signed off until he is
declared fit to work or the degree of disability
has been assessed by the
company-designated physician.
The period within the seafarer shall be entitled
to sickness allowance shall not exceed 120
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days. Payment of the sickness allowance shall
be made on a regular basis, but not less than
once a month [Sec. 20. A.3, POEA-SEC].
Other Expenses
The seafarer shall be entitled to reimbursement
of the cost of medicines prescribed by the
company-designated physician.
In case treatment of the seafarer is on an
outpatient basis as determined by the
company-designated physician, the company
shall approve the appropriate mode of
transportation and accommodation.
The reasonable cost of actual traveling
expenses and/or accommodation shall be paid
subject to liquidation and submission of official
receipts and/or proof of expenses [Sec. 20,
A.3, POEA-SEC].
Post-Employment Medical Examination
General Rule: The seafarer shall submit
himself/herself to a post-medical examination
by a company- designated physician within
three working days upon his return.
Exception: When the seafarer is physically
incapacitated to do so. In which case, a written
notice to the agency within the same period is
deemed as compliance [Sec. 20, A.3,
POEA-SEC].
Mandatory Reporting Requirement
In the course of the treatment, the seafarer
shall also report regularly to the
company-designated physician specifically on
the dates as prescribed by the
company-designated physician and agreed to
by the seafarer.
Failure of the seafarer to comply with the
mandatory reporting requirement shall result in
his forfeiture of the right to claim the above
benefits [Sec. 20, A.3, POEA-SEC].
Schedule of Benefits
See Sec. 32 of POEA-SEC for the schedule of
disability or impediment for injuries suffered
and diseases including occupational diseases
of illness contracted in the course of work.
Those illnesses not listed in Sec. 32 are
disputably presumed as work-related
Repatriation
In case a seafarer is disembarked from the
ship for medical reasons, the employer shall
bear the full cost of repatriation in the event the
seafarer is declared:
1. Fit for repatriation; or
2. Fit to work but the employer is unable to
find employment for the seafarer on
board his/her former ship or another
ship of the employer [Sec. 20, A.5,
POEA-SEC].
Guidelines for the Claim of Permanent Total
Disability Benefits
The employer must also compensate the
seafarer for his/her permanent total or partial
disability as finally determined by the
company-designated physician.
The following guidelines shall govern seafarers'
claims for permanent and total disability
benefits:
1. The company-designated physician
must issue a final medical assessment
on the seafarer's disability grading within
a period of 120 days from the time the
seafarer reported to him;
2. If the company-designated physician
fails to give his/her assessment within
the period of 120 days, without any
justifiable reason, then the seafarer's
disability becomes permanent and total;
3. If the company-designated physician
fails to give his/her assessment within
the period of 120 days with a sufficient
justification (e.g. seafarer required
further medical treatment or seafarer
was uncooperative), then the period of
diagnosis and treatment shall be
extended to 240 days. The employer
has the burden to prove that the
company-designated physician has
sufficient justification to extend the
period; and
4. If the company-designated physician still
fails to give his assessment within the
extended period of 240 days, then the
seafarer's disability becomes permanent
and total, regardless of any justification
[Jebsens Maritime Inc. v. Rapiz, G.R.
No. 218871].
b. Compensation and Benefits for Death
In case of work-related death of the seafarer,
during the term of his contract, the employer
shall pay his/her beneficiaries the Philippine
currency equivalent to the amount of Fifty
Thousand US dollars (US$50,000) and an
additional amount of Seven Thousand US
dollars (US$7,000) to each child under the age
of twenty-one (21) but not exceeding four (4)
children, at the exchange rate prevailing during
the time of payment [Sec. 20, B.1,
POEA-SEC].
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When Compensation Payable is Double
Where death is caused by warlike activity while
sailing within a declared war zone or war risk
area, the compensation payable shall be
doubled [Sec. 20, B.2, POEA-SEC].

Other liabilities of the employer when the

seafarer dies as a result of work-related injury
or illness during the term of employment are as
follows:
1. The employer shall pay the deceased’s
beneficiary all outstanding obligations
due the seafarer under this Contract.
2. The employer shall transport the
remains and personal effects of the
seafarer to the Philippines at employer’s
expense except if the death occurred in
a port where local government laws or
regulations do not permit the transport
of such remains. In case death occurs at
sea, the disposition of the remains shall
be handled or dealt with in accordance
with the master’s best judgment.

In all cases, the employer/master shall

communicate with the manning agency
to advise for disposition of seafarer’s
remains.

3. The employer shall pay the beneficiaries

of the seafarer the Philippine currency
equivalent to the amount of
US$1,000.00 for burial expenses at the
exchange rate prevailing during the time
of payment [Sec. 20, B.4, POEA-SEC].

When Compensation is Not Payable

No compensation and benefits shall be
payable in respect of any injury, incapacity,
disability or death of the seafarer resulting from
his willful or criminal act or intentional breach of
his duties, provided however, that the employer
can prove that such injury, incapacity, disability
or death is directly attributable to the seafarer
[Sec. 20, D, POEA-SEC].

Note: Applies to both disability and death

benefits.

Prescription of Claims
All claims arising from this contract shall be
made within three (3) years from the date the
cause of action arises, otherwise the same
shall be barred [Sec. 30, POEA-SEC].

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