GENERAL TOPIC 1: General Provision

A. Basic Policy On Labor]

Under Article 3 of Labor Code:
a) Full protection to labor;
b) Promotion of full employment;
c) Promotion of equal work opportunities regardless of sex, race or creed;
d) Regulation of the relations between workers and employers;
e) Protection of the rights of workers to:
1. self-organization;
2. collective bargaining;
3. security of tenure; and
4. just and humane conditions of work.
Under Article XIII, Section 3 of the Constitution:
a) Full protection to labor, local and overseas, organized and unorganized;
b) Promotion of full employment;
c) Promotion of equality of employment opportunities for all;
d) Guarantee of the rights of all workers to:
1. self-organization;
2. collective bargaining and negotiations;
3. peaceful concerted activities, including the right to strike in accordance with law;
4. security of tenure;
5. humane conditions of work;
6. a living wage;
7. participate in policy and decision-making processes affecting their rights and benefits
as may be
8. provided by law.
e) Promotion of 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.
f) Regulation of 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 to investments, and to expansion and growth.

B. CONSTRUCTION IN FAVOR OF LABOR

1.Under Article 1702 of the Civil Code.
“Article 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.”
2.Article 4 of Labor Code:
“Article 4. Construction in Favor of Law. - 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.”
3. Follow this rule in interpreting and construing:
a. DOUBTS OR AMBIGUITIES IN LABOR CONTRACTS such as employment contract
and collective bargaining agreement (CBA);
b. DOUBTS OR AMBIGUITIES IN EVIDENCE in labor cases.

C. Constitutional and Civil Code Provision Relating of Labor Law

1,Selected Constitutional Provisions.
 Under Article II (Declaration of Principle and State Policy)
a. “Section 18. The State affirms labor as a primary social economic force. It shall
protect the rights of workers and promote their welfare.”
This provision is invoked by the Supreme Court when it affirms the interest, rights and
welfare of labor.
Example: When the SC nullifies a patently illegal provision in an employment contract or
when it invalidates a Quitclaim executed by a worker because of unconscionably low
consideration.
 Under Article III (Bill of Rights)
A. Freedom of speech, of expression, of the press, or the right of the people peaceably to
assemble and petition the government for redress of grievances.
This Freedom guaranteed under Article 3, Section 4 of the Constitution is relevant only in
connection with Picketing and Not in relation to strike which has different Constitutional
Basis (Article 3, Section 3).
B. Right of public and private sector employees form unions, association, or societies for
purpose not contrary to law shall not abridged.
This is known as “Freedom of Association.” This Provision is the basis for the employees
rights to Self-Organization.
C. Non-impairment of obligations of contracts.
 The Concept of this right in Political Law is similar in Labor Law.

D. Right to speedy disposition of cases in judicial, quasi-judicial or administrative

bodies.
 This can be invoked in Labor Cases at All Levels, to wit:
1.Before quasi-judicial or administrative bodies, such as:
a) Labor Arbiters, NLRC;
b) Med-Arbiters/BLR;
c) DOLE Regional Directors/DOLE Secretary; and
d) Voluntary Arbitrators.
2.Before judicial bodies, such as:
a) Court of Appeals; and
b) Supreme Court,
c) When labor cases reach these higher level courts.

E. Prohibition against involuntary servitude.

This Principle is Relevant only in three (3) situation: Namely: (1)Resignation and (2) Return-
to-work Order in National Interest Cases. This means that:
(1) An Employee has the Right to Resign since he cannot be forced to work against
his will;
(2) The moment an assumption of Jurisdiction Order (AJO) is issued by the DOLE
Secretary in National Interest Cases, A Striker can be ordered to return to work
even against his will in case at the time of such Issuance of the AJO, there was
already an On-Going Strike; and
(3) When Employees are Called upon to Render Military or Civic Duty.

 Under Article XIII (Social Justice and Human Rights):

Section 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.
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 to investment, and to expansion and growth.
2. Selected Civil Code Provision:
 Article 1700 of the 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.”
In Davao Integrated Port Stevedoring Services v. Abarquez, March 19,1993. It was held that
a CBA, as a labor contract within the contemplation of Article 1700 of the Civil Code, is not
merely contractual in nature but impressed with public interest, thus, it must yield to the
common good.
Similarly, an employment contract or any other labor contract is treated as not merely
contractual in nature similar to an ordinary contract like a lease contract because it is
impressed with public interest. Consequently, all labor laws are deemed read or
incorporated therein even if not so expressly provided or stipulated in its provisions.
 Article 1702 of the Civil Code. (See discussion above Article 1702 of the Civil Code, in
relation to Article 4 of the Labor Code regarding the rule on interpretation and
construction provisions of law and labor Contracts).

Major Topic 2: Pre-Employment

a. Illegal Recruitment
 Who may commit Illegal recruitment?
Illegal recruitment may be committed by any of the following
(1) By Non-Licensee or Non-holder of authority; or
(2) By ANY PERSON, regardless of whether a non-licensee, non-holder, licensee or
holder of authority.
 What are Illegal recruitment acts that can be committed by No. 1 above (NON-
LICENSEE OR NON-HOLDER OF AUTHORITY?)
When what is committed by such NON-LICENSEE or NON-HOLDER OF AUTHORITY is any
of the acts of recruitment allowed only to be done by licensees or holder of the authority
such as the 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.
In other word, had they possessed of license or authority, their commission of any of the
foregoing acts could have been valid and not constitutive of illegal recruitment.
NOTE: The non-licensee or non-holder of authority is presumed to be engaged in such
recruitment if he, in any manner, offers or promises for a fee employment abroad to two or
more persons.
 What are acts of illegal recruitment when committed by ANY PERSON, whether a
NON-LICENSEE, NON-HOLDER OF AUTHORITY or even by a LICENSEE or HOLDER
OF AUTHORITY?
(a) To charge or accept, directly or indirectly, any amount greater than that specified in
the schedule of allowable fees prescribed by the DOLE Secretary, or to make a worker
pay or acknowledge any amount greater than that actually received by him as a loan
or advance;
(b) To furnish or publish any false notice or information or document in relation to
recruitment or employment;
(c) To give any false notice, testimony, information or document or commit any act of
misrepresentation for the purpose of securing a license or authority under the Labor
Code, or for the purpose of documenting hired workers with the POEA, which include
the act of reprocessing workers through a job order that pertains to non-existent
work, work different from the actual overseas work, or work with a different employer
whether registered or not with the POEA;
(d) To induce or attempt to induce a worker already employed to quit his employment in
order to offer him another unless the transfer is designed to liberate a worker from
oppressive terms and conditions of employment;
(e) 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;
(f) 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 ;
(g) To fail to submit reports on the status of employment, placement vacancies,
remittance of foreign exchange earnings, separation from jobs, departures and such
other matters or information as may be required by the Secretary of Labor and
Employment;
(h) To substitute or alter to the prejudice of the worker, employment contracts approved
and verified by the DOLE 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;
(i) 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 to be engaged
directly or indirectly in the management of travel agency ;
(j) To withhold or deny travel documents from applicant workers before departure for
monetary or financial considerations, or for any other reasons, other than those
authorized under the Labor Code and its implementing rules and regulations;
(k) Failure to actually deploy a contracted worker without valid reason as determined by
the Department of Labor and Employment;
(l) Failure to reimburse expenses incurred by the worker in connection with his
documentation and processing for purposes of deployment, in cases where the
deployment does not actually take place without the worker's fault. Illegal
recruitment when committed by a syndicate or in large scale shall be considered an
offense involving economic sabotage ; and
(m) To allow a non-Filipino citizen to head or manage a licensed
recruitment/manning agency.
Prohibited Activities in Relation to Illegal Recruitment

 What are the PROHIBITED ACTIVITIES in connection with recruitment for overseas
employment?
Besides illegal recruitment, the law additionally provides that it shall also be unlawful for
any person or entity to commit the following prohibited acts:
(1) Grant a LOAN to an overseas Filipino worker with interest exceeding eight
percent (8%) per annum, which will be used for payment of legal and allowable
placement fees and make the migrant worker issue, either personally or
through a guarantor or accommodation party, post-dated checks in relation to
the said loan;
(2) Impose a compulsory and exclusive arrangement whereby an overseas Filipino
worker is required to avail of a LOAN only from specifically designated
institutions, entities or persons;
(3) Refuse to condone or renegotiate a LOAN incurred by an overseas Filipino
worker after the latter's employment contract has been prematurely terminated
through no fault of his or her own;
(4) Impose a compulsory and exclusive arrangement whereby an overseas Filipino
worker is required to undergo HEALTH EXAMINATIONS only from specifically
designated medical clinics, institutions, entities or persons, except in the case
of a seafarer whose medical examination cost is shouldered by the
principal/shipowner;
(5) Impose a compulsory and exclusive arrangement whereby an overseas Filipino
worker is required to undergo TRAINING, SEMINAR, INSTRUCTION OR
SCHOOLING of any kind only from specifically designated institutions, entities
or persons, except for recommendatory trainings mandated by
principals/shipowners where the latter shoulder the cost of such trainings;
(6) For a SUSPENDED RECRUITMENT/MANNING AGENCY to engage in any kind
of recruitment activity including the processing of pending workers'
applications; and
(7) For a recruitment/manning agency or a foreign principal/employer to pass on
the overseas Filipino worker or deduct from his or her salary the payment of
the cost of INSURANCE fees, premium or other insurance related charges, as
provided under the compulsory worker's INSURANCE coverage.

License vs. Authority

 What is a “license” for overseas recruitment?
License” refers to the document issued by the DOLE Secretary authorizing a person,
partnership or corporation to operate a private recruitment or manning agency.
 What is an “authority” for overseas employment?
“Authority” refers to the document issued by the DOLE Secretary authorizing the officers,
personnel, agents or representatives of a licensed recruitment or manning agency to
conduct recruitment and placement activities in a place stated in the license or in a
specified place.
ELEMENTS OF ILLEGAL RECRUITMENT
 What are the 2 elements of simple illegal recruitment?
(1) The offender has no valid license or authority required by law to enable one to
lawfully engage in recruitment and placement of workers; and
(2) He undertakes either any activity within the meaning of “recruitment and placement”
defined under Article 13(b), (see above enumeration) or any prohibited practices (see
above enumeration) under Article 34 of the Labor Code.

 Can a recruiter be a natural or juridical person?

- Yes

 What are some relevant principles on illegal recruitment?

1. Mere impression that a person could deploy workers overseas is sufficient to
constitute illegal recruitment. But if no such impression is given, the accused should
not be convicted for illegal recruitment.
2. Mere promise or offer of employment abroad amounts to recruitment.
3. There is no need to show that accused represented himself as a licensed recruiter.
4. Referrals may constitute illegal recruitment.
5. It is illegal recruitment to induce applicants to part with their money upon false
misrepresentations and promises in assuring them that after they paid the placement
fee, jobs abroad were waiting for them and that they would be deployed soon.
6. Recruitment whether done for profit or not is immaterial.
7. The act of receiving money far exceeding the amount as required by law is not
considered as “recruitment and placement” as this phrase is contemplated under the
law.
8. Actual receipt of fee is not an element of the crime of illegal recruitment.
9. Conduct of interviews amounts to illegal recruitment.
10. Absence of receipt is not essential to hold a person guilty of illegal recruitment.
11. Conviction for illegal recruitment may be made on the strength of the
testimonies of the complainants.
12. Absence of documents evidencing the recruitment activities strengthens, not
weakens, the case for illegal recruitment.
13. Only one person recruited is sufficient to convict one for illegal recruitment.
14. Non-prosecution of another suspect is immaterial.
15. Execution of affidavit of desistance affects only the civil liability but has no
effect on the criminal liability for illegal recruitment.
16. Defense of denial cannot prevail over positive identification. Positive
identification where categorical and consistent and not attended by any showing of ill
motive on the part of the eyewitnesses on the matter prevails over alibi and denial.
Between the categorical statements of the prosecution witnesses, on the one hand,
and bare denials of the accused, on the other hand, the former must prevail.

ILLEGAL RECRUITMENT AS A FORM OF ECONOMIC SABOTAGE

  When is illegal recruitment considered a crime involving economic sabotage?
1. When committed by a syndicate ; or
2. When committed in large scale
NOTE: THE FIGURE THREE ( 3) MAKES THE DIFFERENCE, THUS:
 3 OR MORE RECRUITERS REGARDLESS OF NO. OF RECRUITEES = BY A
SYNDICATE
 3 OR MORE RECRUITEES REGARDLESS OF NO. OF RECRUITERS = IN LARGE
SCALE

 When is illegal recruitment committed by a syndicate?

If it is carried out by a group of three (3) or more persons conspiring or confederating with
one another.
 The essential elements of the crime of illegal recruitment committed by a syndicate
are as follows:
1. There are at least three (3) persons who, conspiring and/or confederating with one
another, carried out any unlawful or illegal recruitment and placement activities as
defined under Article 13(b) or committed any prohibited activities under Article 34 of
the Labor Code; and
2. Said persons are not licensed or authorized to do so, either locally or overseas.
The law does not require that the syndicate should recruit more than one (1) person in
order to constitute the crime of illegal recruitment by a syndicate. Recruitment of one (1)
person would suffice to qualify the illegal recruitment act as having been committed by a
syndicate.

 When is illegal recruitment considered in large scale?

If committed against three (3) or more persons individually or as a group
 Elements of illegal recruitment in large scale.
The elements of illegal recruitment in large scale, as distinguished from simple illegal
recruitment, are as follows:
1. The accused engages in the recruitment and placement of workers as defined under
Article 13(b) or committed any prohibited activities under Article 34 of the Labor
Code; and
2. The accused commits the same against three (3) or more persons, individually or as a
group .

 Distinguished from illegal recruitment by a syndicate.

As distinguished from illegal recruitment committed by a syndicate, illegal recruitment
in large scale may be committed by only one (1) person. What is important as qualifying
 element is that there should be at least three (3) victims of such illegal recruitment,
individually or as a group.
 Recruitment in large scale or by a syndicate is malum prohibitum and not malum in
se.
ILLEGAL RECRUITMENT VS. ESTAFA
 Can a person be charged and convicted separately for illegal recruitment and estafa
involving one and the same act of recruitment?
Yes. It is clear that conviction under the Labor Code does not preclude conviction for estafa
or other crimes under other laws.
Some relevant principles:
 Same evidence to prove illegal recruitment may be used to prove Estafa.
 Conviction for both illegal recruitment and Estafa is not double jeopardy.

NATURE OF LIABILITY OF LOCAL RECRUITMENT AGENCY AND FOREIGN EMPLOYER

 What is the nature of the liability between local recruiter and its foreign principal?
The nature of their liability is “solidary” or “joint and several” for any and all claims arising
out of the employment contract of OFWs.
 Is the solidary liability of corporate officers with the recruitment agency “automatic”
in character?
No. In order to hold the officers of the agency solidarity liable, it is required that there must
be proof of their culpability therefor. Thus, it was held in the 2013 case of Gagui v. Dejero,
1 that while it is true that R.A. 8042 and the Corporation Code provide for solidary liability,
this liability must be so stated in the decision sought to be implemented. Absent this
express statement, a corporate officer may not be impleaded and made to personally
answer for the liability of the corporation.
 What are some relevant principles on the persons liable for illegal recruitment?
1. Employees of a licensed recruitment agency may be held liable for illegal recruitment
as principal by direct participation, together with his employer, if it is shown that he
actively and consciously participated in illegal recruitment.
2. Good faith and merely following orders of superiors are not valid defenses of an
employee.
3. A manager of a recruitment/manning agency is not a mere employee. As such, he
receives job applications, interviews applicants and informs them of the agency’s
requirement of payment of performance or cash bond prior to the applicant’s
deployment. As the crewing manager, he was at the forefront of the company’s
recruitment activities

THEORY OF IMPUTED KNOWLEDGE

 What is meant by this theory?
Knowledge of the agent is deemed knowledge of the principal but not the other way around.
The theory of imputed knowledge is a rule 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 insofar as the
transaction is concerned, even though the knowledge, in fact, is not communicated to the
principal at all.
Sunace International Management Services, Inc. v. NLRC 2 - The High Court here has the
opportunity to discuss the application of the theory of imputed knowledge. The OFW
(Divina), a domestic helper in Taiwan, has extended her 12-month contract, after its
expiration, for two (2) more years after which she returned to the Philippines. It was
established by evidence that the extension was without the knowledge of the local
recruitment agency, petitioner Sunace. The Court of Appeals, however, affirmed the Labor
Arbiter’s and NLRC’s finding that Sunace knew of and impliedly consented to the extension
of Divina’s 2-year contract. It went on to state that “It is undisputed that [Sunace] was
continually communicating with [Divina’s] foreign employer.” It thus concluded that “[a]s
agent of the foreign principal, ‘petitioner cannot profess ignorance of such extension as
obviously, the act of the principal extending complainant ( sic ) employment contract
necessarily bound it.’”
In finding that the application by the CA of this theory of imputed knowledge was
misplaced , the High Court ruled that this theory ascribes the knowledge of the agent,
Sunace, to the principal, employer Xiong, not the other way around. The knowledge of the
principal-foreign employer cannot, therefore, be imputed to its agent, Sunace. There being
no substantial proof that Sunace knew of and consented to be bound under the 2-year
employment contract extension, it cannot be said to be privy thereto. As such, Sunace and
its owner cannot be held solidarily liable for any of Divina’s claims arising from the 2-year
employment extension. As the New Civil Code provides: “Contracts take effect only between
the parties, their assigns, and heirs, except in case where the rights and obligations arising
from the contract are not transmissible by their nature, or by stipulation or by provision of
law.”

TERMINATION OF CONTRACT OF MIGRANT WORKER WITHOUT JUST OR VALID

CAUSE
 Can an OFW acquire regularity of employment?
1. G.R. No. 196036, Oct. 23, 2013.
2. G.R. No. 161757, Jan. 25, 2006.
No. The prevailing rule is that OFWs are contractual (fixed-term only), not regular,
employees. In fact, they can never attain regularity of employment. The nature of their
employment is always fixed-term.
 What are some relevant principles?
1. Indefinite period of employment of OFWs is not valid as it contravenes the explicit
provision of the POEA Rules and Regulations on fixed-period employment.
2. OFWs do not become regular employees by reason of nature of work, that is, that
they are made to perform work that is usually necessary and desirable in the usual
 business or trade of the employer. The exigencies of their work necessitate that they
be employed on a contractual basis. This notwithstanding the fact that they have
rendered more than twenty (20) years of service.
3. Regular employment does not result from the series of re-hiring of OFWs.
4. The fixed-period employment of OFWs is not discriminatory against them nor does it
favor foreign employers. It is for the mutual interest of both the seafarer and the
employer why the employment status must be contractual only or for a certain period
of time.
5. The expiration of the employment contracts of OFWs marks its ending.

 What is the effect of hiring a seafarer for overseas employment but assigning him to
local vessel?
As held in OSM Shipping Philippines, Inc. v. NLRC, 1 the non-deployment of the ship
overseas did not affect the validity of the perfected employment contract. After all, the
decision to use the vessel for coastwise shipping was made by petitioner only and did not
bear the written conformity of private respondent. A contract cannot be novated by the will
of only one party. The claim of petitioner that it processed the contract of private
respondent with the POEA only after he had started working is also without merit.
Petitioner cannot use its own misfeasance to defeat his claim.

 What is the effect of non-deployment of OFW to overseas employment?

Petitioner-seafarer, in Santiago v. CF Sharp Crew Management, Inc. 2 was not deployed
overseas despite the signing of a POEA-approved employment contract. One of his
contentions is that such failure to deploy was an act designed to prevent him from
attaining the status of a regular employee. The Supreme Court, however, disagreed and
ruled that “seafarers are considered contractual employees and cannot be considered as
regular employees under the Labor Code. Their employment is governed by the contracts
they sign every time they are rehired and their employment is terminated when the contract
expires. The exigencies of their work necessitate that they be employed on a contractual
basis.”
 What is the doctrine of processual presumption?
“Presumed-identity approach” or “processual presumption” is an International Law doctrine
which dictates that where a foreign law is not pleaded or, even if pleaded, is not proved, the
presumption is that foreign law is the same as Philippine law. Thus, under this situation,
Philippine labor laws should apply in determining the issues presented in a case.
 Is due process under Philippine law applicable to termination of employment of
OFWs?
Yes. In the absence of proof of applicable foreign law, OFWs are entitled to due process in
accordance with Philippine laws
 Is the Agabon doctrine applicable to OFWs who are dismissed for cause but without
due process?
Yes. The Agabon doctrine of awarding indemnity in the form of nominal damages in cases
of valid termination for just or authorized cause but without procedural due process also
applies to termination of OFWs.
 Who has the burden of proof to show that the dismissal of the OFW is legal?
Burden of proof devolves on both recruitment agency and its foreign principal.
 Are OFWs entitled to the reliefs under the Labor Code?
No. They are not entitled to such reliefs under Article 279 as reinstatement or separation
pay in lieu of reinstatement or full back wages. REASON: Because their employment is
fixed-term in nature. The nature of their claim therefore is purely monetary, such as the
payment of the salary for the unexpired portion of the employment contract in case their
dismissal is declared illegal.
 What are the reliefs to which OFWs are entitled?
They are entitled to the reliefs provided under Section 10 of R.A. No. 8042, as amended, to
wit:
(1) All salaries for the unexpired portion of the contract;
(2) Full reimbursement of placement fees and deductions made with interest at 12% per
annum.
As pointed out above, all the reliefs available to an illegally dismissed OFW are always
monetary in nature.
It must be noted that under the 2009 Serrano doctrine, ( Serrano v. Gallant Maritime
Services, Inc. ,), 3 an illegally dismissed OFW is now entitled to all the salaries for the entire
unexpired portion of their employment contracts, irrespective of the stipulated term or
duration thereof. The underlined phrase in Section 10 below has been declared
unconstitutional in this case:
“In case of termination of overseas employment without just, valid or authorized cause as
defined by law or contract, or any unauthorized deductions from the migrant worker's
salary, the worker shall be entitled to the full reimbursement of his placement fee and the
deductions made with interest at twelve percent (12%) per annum, plus his salaries for the
unexpired portion of his employment contract or for three (3) months for every year of the
unexpired term, whichever is less.”
However, R.A. No. 10022 (March 8, 2010), which amended R.A. No. 8042 (Migrant Workers
and Overseas Filipinos Act of 1995), has replicated and re-enacted the same
unconstitutional provision exactly as above quoted. The question is: was the
unconstitutionality of the above-underlined part of the provision cured by such replication
or re-enactment in the amendatory law?
The 2014 en banc case of Sameer Overseas Placement Agency, Inc. v. Joy C. Cabiles, 1
answered this in the negative . The said provision was thus declared still unconstitutional
and null and void despite its replication in R.A. No. 10022.
 What are some principles in regard to monetary awards to OFWs?
 1. Monetary award to OFW is not in the nature of separation pay or backwages
but a form of indemnity .
2. Only salaries are to be included in the computation of the amount due for the
unexpired portion of the contract. Overtime, holiday and leave pay and
allowances are not included. However, this rule on exclusion of allowance does
not apply in case it is encapsulated in the basic salary clause.
3. Entitlement to overtime pay of OFWs. - As far as entitlement to overtime pay is
concerned, the correct criterion in determining whether or not sailors are
entitled to overtime pay is not whether they were on board and cannot leave
ship beyond the regular eight (8) working hours a day, but whether they
actually rendered service in excess of said number of hours. An OFW is not
entitled to overtime pay, even if guaranteed, if he failed to present any evidence
to prove that he rendered service in excess of the regular eight (8) working
hours a day.
4. In case of unauthorized deductions from OFW’s salary , he shall be entitled to
the full reimbursement of the deductions made with interest at 12% per
annum. This is in addition to the full reimbursement of his placement fee with
the same interest of 12% per annum plus his salaries for the unexpired portion
of his employment contract if he is terminated without just, valid or authorized
cause as defined by law or contract.
BAN ON DIRECT HIRING
 What is direct hiring?
“Direct Hiring” refers to the process of directly hiring workers by employers for overseas
employment as authorized by the DOLE Secretary and processed by the POEA, including:
1. Those hired by international organizations;
2. Those hired by members of the diplomatic corps;
3. Name hires or workers who are able to secure overseas employment opportunity with
an employer without the assistance or participation of any agency.

 Does the POEA Administrator or the DOLE Secretary or DOLE Regional Director have
the power to issue closure order?
Yes. If upon preliminary examination or surveillance, the DOLE Secretary, the POEA
Administrator or DOLE Regional Director is satisfied that such danger or exploitation
exists, a written order may be issued for the closure of the establishment being used for
illegal recruitment activity.
 Does the DOLE Secretary have the power to issue warrant of arrest and search and
seizure orders?’
No . Salazar v. Achacoso, 2 declared that the exercise by the DOLE Secretary of his twin
powers to issue arrest warrant and search and seizure orders provided under Article 38[c]
of the Labor Code is unconstitutional . Only regular courts can issue such orders.

B. EMPLOYMENT OF NON-RESIDENT ALIENS

“Gainful employment” refers to a state or condition that creates an employer-employee
relationship between the Philippine-based company and the foreign national where the
former has the power to hire or dismiss the foreign national from employment, pays the
salaries or wages thereof and has authority to control the performance or conduct of the
tasks and duties.
 What are the categories of foreign nationals EXEMPTED from securing AEP?
a. All members of the diplomatic service and foreign government officials accredited by
and with reciprocity arrangement with the Philippine government;
b. Officers and staff of international organizations of which the Philippine government is
a member, and their legitimate spouses desiring to work in the Philippines;
c. Owners and representatives of foreign principals whose companies are 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;
d. 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 or 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;
e. Permanent resident foreign nationals and probationary or temporary resident visa
holders under Section 13 (a- f) of the Philippine Immigration Act of 1940 and Section
3 of the Alien Social Integration Act of 1995 (R.A. 7917) ;
f. Refugees and Stateless Persons recognized by DOJ pursuant to Article 17 of the UN
Convention and Protocol Relating to status of Refugees and Stateless Persons; and
g. All foreign nationals granted exemption by law.

 What are the categories of foreign nationals EXCLUDED from securing AEP?
a. 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.
b. President and Treasurer, who are part-owners of the company.
c. Those providing consultancy services who do not have employers in the Philippines.
d. Intra-corporate transferee who is a manager, executive or specialist as defined below
in accordance with Trade Agreements and an employee of the foreign service supplier
for at least one (1) year continuous employment prior to deployment to a branch,
subsidiary, affiliate or representative office in the Philippines
i. an Executive : a natural person within the organisation who primarily directs the
management of the organisation and exercises wide latitude in decision-making
and receives only general supervision or direction from higher level executives, the
board of directors, or stockholders of the business; an executive would not directly
perform tasks related to the actual provision of the service or services of the
organisation;
ii. a Manager : a natural person within the organisation who primarily directs the
organisation/department/subdivision and exercises supervisory and control
functions over other supervisory, managerial or professional staff; does not
include first-line supervisors unless employees supervised are professionals; does
not include employees who primarily perform tasks necessary for the provision of
the service; or
 iii. a Specialist : a natural person within the organisation who possesses knowledge
at an advanced level of expertise essential to the establishment/provision of the
service and/or possesses proprietary knowledge of the organisation's service,
research equipment, techniques or management; may include, but is not limited
to, members of a licensed profession.
All other intra-corporate transferees not within these categories as defined above are
required to secure an AEP prior to their employment in the Philippines.
e. 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.
i. who enters the Philippines temporarily to supply a service pursuant to a contract
between his/her employer and a service consumer in the Philippines;
ii. must possess the appropriate educational and professional qualifications; and
iii. must be employed by the foreign service supplier for at least one year prior to the
supply of service in the Philippines.

f. Representative of the Foreign Principal/Employer assigned in the Office of Licensed

Manning Agency (OLMA) in accordance with the POEA law, rules and regulations.’

 What is the period of validity of an AEP?

One (1) year is the validity of an AEP.
Exception: When employment contract provides otherwise but not to exceed three (3)
years.
The AEP may be renewed subject to the conditions imposed by law.

LABOR STANDARDS
A. Condition of Employment
1. Coverage
 Who are covered by the labor standards provisions of the Labor Code?
Employees in ALL establishments, whether operated for profit or not, are covered by the law
on labor standards.
 Who are excluded?
The following are excluded from the coverage of the law on labor standards:
a. Government employees;
b. Managerial employees;
c. Other officers or members of a managerial staff ;
d. Workers paid by results ;
e. Non-agricultural field personnel ; and
 f. Members of the family of the employer.
2.Hours of Work
a. Principle in Determining Hours Worked
 What are compensable hours worked?
The following shall be considered as compensable hours worked:
a) All time during which an employee is required to be on duty or to be at the
employer’s premises or to be at a prescribed workplace; and
b) All time during which an employee is suffered or permitted to work.
“Fair day’s wage for a fair day’s labor,” remains the basic factor in determining the
employees’ wages and back wages.
B. Normal Hours of Work
 What is the total normal hours of work per day?
- Eight (8) hours daily.

 What is overtime work?

- Any work in excess of said eight (8) normal hours is considered overtime work.
 May normal working hours be reduced?
- Yes, provided that no corresponding reduction is made on the employee’s wage or
salary equivalent to an 8- hour work day. In instances where the number of hours
required by the nature of work is less than 8 hours, such number of hours should be
regarded as the employee’s full working day.
 What are flexible working hours?
- “Flexible work arrangements” refer to alternative arrangements or schedules other
than the traditional or standard work hours, workdays and workweek. The effectivity
and implementation of any of the flexible work arrangements should be temporary in
nature.
Under R.A. No. 8972, otherwise known as “The Solo Parents’ Welfare Act of 2000,” solo
parents are allowed to work on a flexible schedule. The phrase “ flexible work schedule” is
defined in the same law as the right granted to a solo parent employee to vary his/her
arrival and departure time without affecting the core work hours as defined by the
employer.

POWER INTERRUPTIONS/BROWNOUTS
 What are the effects of power interruptions/brownouts?
The following are the effects of work interruption due to brownouts:
a. Brown-outs of short duration but not exceeding twenty (20) minutes shall be treated as
worked or compensable hours whether used productively by the employees or not.
b. Brown-outs running for more than twenty (20) minutes may not be treated as hours
worked provided any of the following conditions are present:
 (1) The employees can leave their workplace or go elsewhere whether within or without
the work premises; or
(2) The employees can use the time effectively for their own interest.
c. In each case, the employer may extend the working hours of his employees outside the
regular schedules to compensate for the loss of productive man-hours without being liable
for overtime pay.
C. Meal Periods (Article 85, Labor Code)
 What is the rule on time-off for regular meal?
Every employer is required to give his employees, regardless of sex, not less than one (1)
hour (or 60 minutes) time-off for regular meals.
 Is meal break compensable?
Being time-off, it is not compensable hours worked. In this case, the employee is free to do
anything he wants, except to work. If he is required, however, to work while eating, he
should be compensated therefor.
D. Night Shift Differential (Article 86, Labor Code)
 How is it reckoned and computed?
Night shift differential is equivalent to 10% of employee's regular wage for each hour of
work performed between 10:00 p.m. and 6:00 a.m. of the following day.
 What is the distinction between night shift differential pay and overtime pay?
When the work of an employee falls at night time, the receipt of overtime pay shall not
preclude the right to receive night differential pay. The reason is the payment of the night
differential pay is for the work done during the night; while the payment of the overtime pay
is for work in excess of the regular eight (8) working hours.
 How is Night Shift Differential Pay computed?
1. Where night shift (10 p.m. to 6 a.m.) work is regular work. a. On an ordinary day:
Plus 10% of the basic hourly rate or a total of 110% of the basic hourly rate. b. On a
rest day, special day or regular holiday: Plus 10% of the regular hourly rate on a rest
day, special day or regular holiday or a total of 110% of the regular hourly rate.
2. Where night shift (10 p.m. to 6 a.m.) work is overtime work. a. On an ordinary day:
Plus 10% of the overtime hourly rate on an ordinary day or a total of 110% of the
overtime hourly rate on an ordinary day. b. On a rest day or special day or regular
holiday: Plus 10% of the overtime hourly rate on a rest day or special day or regular
holiday.
3. For overtime work in the night shift. Since overtime work is not usually eight (8)
hours, the compensation for overtime night shift work is also computed on the basis
of the hourly rate.
a. On an ordinary day. Plus 10% of 125% of basic hourly rate or a total of 110% of
125% of basic hourly rate.
b. On a rest day or special day or regular holiday. Plus 10% of 130% of regular hourly
rate on said days or a total of 110% of 130% of the applicable regular hourly rate.