Labor Law UST Golden Notes

LABOR STANDARDS
PRELIMINARY TITLE
Q: What is labor?
A: It is the exertion by human beings of
physical or mental efforts, or both.jowards the
production of goods and services?(MenCfoza,
2001)
Q: What is labor law?
A: The law governing the rights and duties of
the employer and employees with respectto:
1. The terms and conditions of
employment and
2. Labor disputes arising fromcollective
bargaining (CB) respecting such
terms andconditions.
Q: What is the purpose of labor legislation?
A: Labor legislation is an exercise of police
power. The purpose of labor legislation is to
regulate the relations betweenemployers (Ers)
and employees (Ees) respectingthe terms and
conditions of employment, either by providing
for certain standards or for a legal framework
within which better terms and conditions of
work could be negotiated through CB. It is
intended to correct the injustices inherent in
Er-Ee relationship. (2006 BarQuestion)
Q: What are the classifications of labor
law?
A:
1. Labor standards - The minimum
terms and conditions of employment
prescribed by existing laws, rules and
regulations relating to wages, hours
of work, cost-of-living allowance and
other monetary and welfare benefits.
(Batong Buhay Gold Mines, Inc. v.
Dela Serna, G.R. No. 86963, August
6,1999)
e.g. ra" monthpay
2. Labor relations - Defines and
regulates the status, rights and
duties, and the institutional
mechanisms, that govern the
individual and collective interactions
of Ers, Ees, or their representatives. It
is concerned with the stabilization of
relations of Er and Ees and seek to
fOt8-?taU .~n0 ~~::\,~t :h8 (jiff~1renc:::s
between them by the encouragement
of collective bargaining and the
settlement of labor disputes through
conciliation, mediationand arbitration.
(Azucena, 2007)
e.g. Additional allowance pursuant to
CBA
3. Social legislation - It includes laws
that provide particular kinds of
protection or benefits to society or
segments thereof in furtherance' of
social justice. (Azucena, 2007)
e.g. GSIS Law, SSS Law, Philhealth
benefits
Q: Is there any distinction between labor
legislation andsocial legislation? Explain.
A: Labor legislation is sometimes
distinguished from social legislation by the
former referring to labor statutes, like Labor
Relations Law and Labor Standards, and the
latterto Social Security Laws. Laborlegislation
focuses on the rights of the worker in the
workplace.
Social legislation is a broad term and may
include not only laws that give social security
protection, but also those that help the worker
secure housing and basic necessities. The
Comprehensive Agrarian Reform Law could
also be considered a social legislation. All
labor laws are social legislation, but not all
social legislation is labor law. (1994 Bar
Question)
ART. 3. QECLARATION OF POLICY
Q: What is the Statepolicy onlabor?
A:
1. Affordfull protectionto labor
2. Promote full employment
3. Ensure equal work opportunities
r~ardless of sex, race, or creed
4. Assure the rights of workers to self
organization, security of tenure, just
and humane conditions of work,
participate in policy and decision-
making processes affectingtheir right
and benefits
5. Regulate the relations between
workers and employers
1' ai : : i fta/ de (j )er ecno Ci vi C
1.
LI\BOR STANDARDS: GENERAL PROVISIONS
Q: What is the principle of non-
oppression?
A: The principle mandates capital and labor
not to act oppressively against each other or
impair the interest and convenience of the
public. The protection to iabor clause in the
Constitution is not designed to oppress or
destroy capital. (Capili v. NLRC, G.R. No.
117378, Mar. 26, 1997)
Q: What is the aim of labor laws?
A: The justification of labor laws is 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 force by the State so
that justice in its rational and objectively
secular conception may at least be
approximated. Social justice means the
promotion of the welfare of all the people, the
adoption by the government of measures
calculated to insure economic stability of all
the competent elements of society, through the
maintenance of a proper economic and social
equilibrium in the interrelations of the members
of the community, constitutionally, through the
adoption of measures legally justifiable, or
extra-Sonstitutionally, through the exercise of
powers underlying the existence of all
governments on the time-honored principle of
salus populi est suprema lex.(Calalang v.
Williams, G.R. No. 47800, Dec. 2, 1940)
Q: What is "compassionate justice"?
A: It is disregarding rigid rules and giving due
weight to all equities of the case.
e.g: Employee validly dismissed may still be
given severance pay.
Q: What are the sources of labor laws?
A:
1. Labor Code and other related gf,ecial
legislation
2. Contract
3. Collective Bargaining Agreement
4. Past practices
5. Company policies
Q: What are the constitutional mandates
with regard labor laws?
A:
..L.Sec. 3, Art. XIII - The State shall
afford full protection to labor, local
and overseas, organized and
unorganized, and promote full
2
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 investments, and to expansion and
growth.
2. Sec. 9, Art. II - The State shall
promote a just and dynamic social
order that will ensure the prosperity
and independence of the nation and
free the people from poverty through
policies that provide adequate social
services, promote full employment, a
rising standard of living, and an
improved quality of life for all.
3. Sec. 18, Art./ II - The State affirms
labor as a primary social economic
force. It shall protect the rights of
workers and prqmote their welfare.
4. Sec. 8, Art. III - 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.
5. Sec. 18 (2), Art. III - No involuntary
servitude in any form shall exist
except as a punishment for a crime
whereof the party shall have been
duly convicted .
6. Sec. 12, Art. XII - The State shall
establish and maintain an effective
food and drug regulatory system and
UST GOLDEN NOTES 2010
Art. 289 - Formation, maintenance
and prohibition of combination of
capital or labor through violence or
.threats. - Any person who, for the
purpose of organizing, maintaining or
preventing coalitions or capital or
labor, strike of laborers or lock-out of
employees, shall employ violence or
threats in such a degree as to compel
or force the laborers or employers in
UNIVERSITY OF SANTO TOMAS
undertake appropriate health,
manpower development, and
research, responsive to the country's
health needs and problems.
7. Sec. 14, Art. XIII - 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 Iflhanc~ their
welfare and enable them to 'realize
their full potential in the service of the
nation.
Q: What areother relatedlaws to labor?
A:
1. Civil Code
a. 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 gooa. 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.
b. Art. 1701 - Neither capital nor
labor shall act oppressively
against the other, or impair the
interest or convenience of the
public.
c. 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.
d. Art. 1703 - No contract which
practically amounts to involuntary
servitude, under any guise
whatsoever, shall be valid.
2. Revised Penal Code
the free and legal exercise of their
industry or work, if the act shall not
constitute a more serious offense in
accordance with the provisions of the
RPC.
3. Special Laws
a. GSIS Law
b. 13
th
Month Pay Law
c. Retirement Pay Law
d. SSS Law
e. Paternity Leave Act
f. Anti - Child Labor Act
g. Anti - Sexual Harassment Act
h. Magna Carta for Public Health
Workers
i. Solo Parents Welfare Act of 2000
j. National Health Insurance Act as
amended by R.A. 9241
k. Migrant Workers and Overseas
Filipinos Act of 1995 as amended
by RA 10022
I. PERA Act of 2008
m. Home Development Mutual Fund
Law of 2009
n. The Magna Carta of Women
o. Comprehensive Agrarian Reform
Law as amended by R.A. 9700
Q: What are the basic rights of workers
guaranteed bythe Constitution?
A:
1. Security of tenure
2. Receive a living wage
3. Humane working conditions
4. Share in the fruits of production
5. Organize themselves
6. Conduct collective bargaining or
negotiation with management
7. Engage in peaceful concerted
activities including strike
8. Participate in policy and decision
making processes
Q: Whois anemployer (Er)?
A:
1. One who employs the services of
others
2. One for whom employees work and
who pays their wages and salaries
Q:Who isan employee (Ee)?
A:
1. A person working for salary or wages
2. Any person in the service of another
under a contract for hire, express or
implied, oral or written
Pacu{ taa de ([ )er ecno CiviC
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, LABOR STANDARDS~GENERAL PROVISIONS
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Q: Describeemployer fEr) - employee(Ee)
relationship?
A:
1. Contractual in nature but impressed
with public interest. - It arises from
the agreement of the parties.
However, since a labor contract is
impressed so much with public
interest, it must conform to the
common good. Hence, it is subject to
special laws on public unions,
collective bargaining and strikes, etc.:
Further, the parties are enjoined not
to act oppressively against each
other, or impair the interest or
convenience of the public.
2. In personam - It involves the
rendition of personal service by the
Ee (partakes of master-servant
relationship) and the effects of the
relationship will only extend to the
parties.
Q: What is the importance of determining
employer(Er)-employee(Ee)relationship?
A:
GR: Labor standards and conditions apply
only if there is Er-Ee relationship.
XPN: Even if there is no Er-Ee relationship,
the LC may still be invoked:
1. Indirect Er's liability
2. Illegal recruitment
3. Misuse of POEA license
Note:The LC may apply even if the parties
are not Ers and Ees of each other.
Employment relationship is not a pre-
condition to the applicability. of the LC but it
depends on the kind of issue involved.
Q:Whois anindependentcontractor?
A: A person who accomplishes the desired
work as specified by the principal in
accordance with his own means and methods.
As long as the desired result is achieved, the
means and methods used are immaterial to
the principal.
Q: Why is it important to distinguish
whether the relationship is that of an Er
and Ee or that of a principal and
independentcontractor?
1. Laws governing them are different. -
Labor laws govern the rights and
liabilities of the parties in an Er-Ee
relationship, while ordinary rules on
contract will apply to an independent
contractor and principal.
2. Courts which have jurisdiction are
likewise different - Labor tribunals will
have jurisdiction over Er-Ee disputes
while regular courts will have
jurisdiction to an independent
contractor and principal.
ART: 4. CONSTRUCTION IN FAVOR OF
. - _LABOR . . j
Q: How should doubts in the
implementation and interpretation of the
Labor Code (LC) and its Implementing
RulesandRegulations(IRR)beresolved?
A: They should be resolved in favor of labor.
Q: Whatis the concept of liberal approach
ininterpretingthe LCandits IRR?
A: The workers' welfare should be the
paramount consideration in interpreting the
LC and its IRR. This is rooted in the
constitutional mandate to afford full protection
to labor. (PLOT v. NLRC, G.R. No. 111933,
July 23, 1997). It underscores the policy of
social justice to accommodate the
interests of the working class on the humane
justification that those who have less in life
shaH have more in law. (PAL v. Santos, G.R.
No. 77875, Feb. 4, 1993). (2006 Bar
Question)
Q: Art. 4 of the LC provides that in caseof
doubt In the implementation and
interpretation of the provisions of the LC
and its IRR,the doubt shall be resolved in
favor of labor. Art. 1702 of the Civil Code
also provides that in case of doubt, all
labor legislation and all labor contracts
shall be construed in favor of the safety
anddecentliving of the laborer.
Mica-MaraCompanyassails the validity of
these statutes on the ground that they
violate its constitutional right to equal
protection of the laws. Is the contention of
MicaMaraCompanytenable? Discussfully.
A: No, the Constitution provides that the State
shall afford full protection to labor.
Furthermore, the State affirms labor as a
primary economic force. It shall protect the
rights of workers and promote their welfare.
(1998BarQuestion)
Q: What are the reasons for affording
greater protection to employees?
A:
Greater supply than demand for
labor;and
2.. Needfor employmentbylaborcomes
from vital. .and.desperatenecessity.
(Sanchez v. Harry Lyons
Construction Inc., G.R. L-2779, Oct.
18, 1950)
1.
Q: Are all labor disputes resolved in favor
of labor?
A: No. The law also recognizes that
managementhas rightswhicharealsoentitled
to respectand enforcementin the interestof
fair play. (St. Lukes Medical Center Ees Ass'n
v. NLRC, GR. No. 162053, Mar. 7, 2007)
Q: What is management prerogative?
A: It is the right of an Er to regulate, unless
otherwiselimitedbyspecial laws, accordingto
his owndiscretionandjudgment, all aspectsof
employment, including hiring, work
assignments, working methods, time, place
and manner of work, tools to be used,
processes to be followed, supervision of
workers, working regulations,transferof Ees,
work supervision, lay-off of workers and'the
discipline,dismissalandrecallof workers.
Q: Is the exercise of management
prerogative unlimited?
A: No. A line must be drawn between
managementprerogativesregardingbusiness
operations per se and those which affectthe
rightsof employees(Ees). Intreatingthelatter,
managementshouldseeto it that its Ees are
at least properlyinformedof its decisionsand
modes of actions. (PAL v. NLRC, GR. No.
8598~Aug. 13, 1993)
Q:1. An exclusive school for girls, run by a
religious order, has a policy of not
employing unwed mothers, women with
live-in partners, and lesbians. Is the policy
violative of any provision of the LC on
employment of women?
2. The same school dismissed 2 female
faculty members on account of pregnancy
out of wedlock. Did the school violate any
provision of the LC on employment of
women?
management function. Considering
the nature and reason for existence
of the school, it may adopt such
policy as will advance its laudable
objectives. Infact, the policyaccords
with the constitutional precept of
inculcating ethical and moral values
in schools. The- school policy does
not discriminate against women
solely on account of sex (Art. 135,
LC) nor arethe acts prohibitedunder
Art. 137 of the LC.
2. No, because to tolerate pregnancy
out of wedlock will be a blatant
contradictionof the school's laudable
mission which, as already stated,
accords with high constitutional
precepts. This answer does not
contradict the ruling in Chua-Qua
wherethe teacher merelyfell in love
with a bachelor student and the
teacher, also single, did not get
pregnant out of wedlock. (2000 Bar
Question)
Q: Little Hands Garment Company, an
unorganized manufacturer of children's
apparel with around 1,000 workers,
suffered losses for the 1st first time in
history when its US and European
customers shifted their huge orders to
China and Bangladesh. The management
informed its Ees that it could no longer
afford to provide transportation shuttle
services. Consequently, it announced that
a normal fare would be charged depending
on the distance traveled by the workers
availing of the service.
Was the Little Hands Garments Company
within its rights to withdraw this benefit
which it had unilaterally been providing to
its Ees?
A: Yes, because this is a management
prerogative which is not due any legal or
contractual obligation. - Thefacts of the case
do not statethe circumstancesthroughwhich
the shuttle service may be consideredas a
benefit that ripened into a demandableright.
Thereis noshowingthat the benefithas been
deliberatelyand consistentlygranted, i.e. with
the employer'sfull consciousnessthat despite
its not beingboundbylawor contracttogrant
it, it just the same grantedthe benefit. (2005
Bar Question)
Q: Arnulfo, a supervisor of QuantumFoods
A: Inc., was transferred by the latter as Area
1. No, the policy does not violate the Sales Manager of Cebu to Area Sales
LC. The practiceis avalidexerciseof Manager of head office when the former
UNIVERS!TY OF SANTO TOMAS ~ 5'
facu{taa ae (j)erecno CiviC' .
LABOR STANDARDS: GENERAL PROVISIONS
denied liability of the company's decrease
in merchandise due to his mismanagement
of sales. Was the transfer of Arnulfo valid?
A: Yes. 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. 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, Jan. 30, 2009, J . Carpio-
Morales)
ART. 5.RULES AND REGULATIONS :
Q: Who is given the "rule-making power"?
A: The Department of Labor and other gov't
agencies charged with the administration and
enforcement of the Labor Code or any of its
parts shall promulgate the necessary
implementing rules and regulations. Such rules
and regulations shall become effective 15days
after announcement of their adoption in
newspapers of general circulation.
Q: What are the limitations to the "rule-
making power" given to the Secretary of
Labor and Employment and other gov't
agencies?
A: It must:
1. Be issued under the authority of the
law
2. Not be contrary to taw and the
Constitution
6 Iteam:__
Q: To whom shall all rights and benefits
under the LC apply?
A:
GR: All rights and benefits granted to
workers under the LC shall apply alike to all
workers, whether agricultural or non-
agricultural.
XPN:
1. Government employees (Ees)
2. Ees of government corporations
created by special or original charter
3. Foreign governments
4. International agencies
5. Corporate officers/ intra-corporate
disputes which fall under P.D. 902-A
and now fall under the jurisdiction of
the regular courts pursuant to the
SRC
6. Local water district except where
NLRC's jurisdiction is invoked.
7. As may otherwise be provided by the
LC
Q: What is the test in determining whether
a GOCC is subject to the Civil Service Law?
A: It is determined by the manner of their
creation. Gov't corporations that are created
by special (original) charter from Congress are
subject to Civil Service rules, while those
incorporated under the General Corporation
Law are covered by the Le.
Q: Who is an agricultural/farm worker?
A:
1. One employed in an agricultural or
farm enterprise,
2. Performs tasks which are directly
related to agricultural activities of the
Er, and
3. Any activities performed by a farmer
as an incident to farming operations.
(Azucena, 2007)
l : t eX ' 3 ' ' j
PRE- EMPLOYMENT
RECRUITMENT AND
PLACEMENT OF WORKERS
Art. 12. POLICY OF THE STATE
Q: What is the policy of the State as
regards labor?
A:
1. Promote and maintain a State of full
employment through improved
manpower training, allocation and
utilization
2. Protect every citizen desiring to work
locally or overseas by securing for
him the best possible terms and
conditions of employment
3. Facilitate a free choice of available
employment by persons seekingwork
inconformitywith the national interest
4. Facilitate and regulate the movement
of workers in conformity with the
national interest
5. Regulate the employment of aliens,
including the establishment of a
registration and/or work permit
system
6. Strengthen the network of public
employment offices and rationalize
the participation of the private sector
in the recruitment and placement of
workers, locally and overseas, to
serve national development
objectives
7. Ensure careful selection of Filipino
workers for overseas employment in
order to protect the good nameof the
Philippines abroad
ART. 13. DEFINITIONS
Q: Who is a worker?
A: Any member of the labor force, whether
employedor unemployed. (Art. 13[aJ, LC)
Q: What is recruitment and placement?
A:
1. Any act of canvassing, enlisting,
contracting, transporting, utilizing,
hiring or procuringworkers; and
2. Includes referrals, contact services,
promising or advertising for
employment, locally or abroad,
whether for profit or not. (Art. 13
[b},LC)
Q: What are the essential elements in
determining whether one is engaged in
recruitment/placement?
A: It must beshownthat:
1. The accused gave the complainant
the distinct impression that she had
the power or ability to send the
complainant forwork,
2. Such that the latter was convincedto
part with his money iii aider to be so
employed. (People v. Goee, G.R. No.
113161, Aug. 29, 1995)
Q: Who Is deemed engaged in recruitment
and placement?
A: Any person or entity which, in any manner,
offers or promises for a fee employmentto 2or
more persons. (Art. 13[b), Le)
Q: What if employment Is offered to only
one person?
A: Immaterial. The number of persons dealt
with is not an essential ingredient of the act of
recruitment and placement of workers. The
proviso merely lays down a rule of evidence
that where afee is collected inconsiderationof
a promise or offer of employment to 2 or more
prospective workers, the individual or entity
dealing with them shall be deemed to be
engaged in the act of recruitment and
placement. The words "shall be deemed"
create that presumption. (People v. Panis,
G.R. L-58674-77, July 11, 1986)
Q: What is a private employment agency?
A: Any person or entity engaged in the
recruitment and placement of workers for a fee
which is charged, directlyor indirectly, fromthe
workers oremployers or both.
Q: What is a license?
A: It is issued by DOLE authorizing a person
or entity to operate a private employment
agency.
Q: What is a private recruitment agency?
A: It is any person or association engaged in
the recruitment and placement of workers
without charging any fee, directly or indirectly,
fromthe workers or employers.
Q: Who is a seaman?
A: Any person employed in a vessel engaged
inmaritime navigation.
UNIVERSITY OF SANTO TOMAS ~. 7
Pacu{ tati ti e < Der ecl i o CilliC' .
LABOR STANDARDS: PRE-EMPLOYMENT
Q: What is overseas employment?
Rule III, POEA Rules Governing Overseas
Employment as amended in 2002)
A: It is employment of a worker outside the
Philippines.
Q: Who is an overseas Filipino worker
(OFW)?
A: A person who is to be engaged, is engaged
or has been engaged in a remunerated activity
in a State of which he or she is not a citizen or
on board a vessel navigat!ng the foreign seas
other than a government ship used for military
or non-commercial purposes or on an
installation located offshore or on the high
. seas; to be used interchangeably with migrant
worker. (Sec. 2, R.A. 10022 amending R.A.
8042)
Q: Who is an emigrant?
A: Any person, worker or otherwise, who
emigrates to a foreign country by virtue of an
immigrant visa or resident permit or its
equivalent in the country of destination.
; -ART. 16.PRIVATE RECRUITMENT
Q: What is the rule in recruitment and
placement?
A:
GR: No person or entity other than the
public employment offices, shall engage in
the recruitment and placement of workers
XPN:
1. Construction contractors if authorized
by the DOLE and Construction
Industry Authority
2. Other persons or entities as may be
authorized by the SLE
3. Members of the diplomatic corps (but
hiring must go through POEA)
4. Public employment offices
5. Private recruitment offices
6. Private employment agencies
7. POEA
8. Shipping or manning agents or
representatives
9. Name hires
Q: Who are name hires?
A: They are individual workers who are able to
secure contracts for overseas employment on
their own efforts and representations without
the assistance or participation of any agency.
Their hiring, nonetheless, shall pass through
the POEA for processing purposes. (Part /II,
8
ART. 17. PHILIPPINE OVERSEAS
.. EMPLOYMENT ADMINISTRATION (POEA)
Q: What are the principal functions of the
POEA?
A:
1. Protection of the right of Filipino
workers to .fair and equitable
emploYglent practices
2. Regulation of private sector
participation in the recruitment and
overseas placement of workers by
setting up a licensing and registration
system
3. Deployment of Filipino workers
through gov't to gov't hiring
4. Formulation, implementation, and
monitoring of overseas employment
of Filipino workers taking into
consideration their welfare and
domestic manpower requirements
5. Shall inform migrant workers not only
of their rights as workers but also of
their rights as human beings, instruct
and guide the workers how to assert
their rights and provide the available
mechanism to redress violation of
their rights. (Sec. 14, R.A. 10022)
6. Implementation, in partnership with
other law-enforcement agencies, of
an intensified program against illegal
recruitment activities. (Sec. 14, R.A.
10022)
Q: What is the rule on deployment of
OFWs?
A: The State shall allow the deployment of
OFWs:
1. Only in countries where the rights of
Filipino migrant workers are
protected.
2. To vessels navigating the foreign
seas or to installations located
offshore or on high seas whose
owners/Ers are compliant with
international laws and standards that
protect the rights of migrant workers.
3. To companies and contractors with
international operations: Provided,
That they are compliant with
standards, conditions and
requirements, as embodied in the
employment contracts prescribed by
the POEA and in accordance with
internationally-accepted standards.
(Sec. 3, R.A. 10022 amending R.A.
8042)
Q: What are the guarantees of the receiving
country for the protection of the rights of
OFWs?
A:
1. It has existing labor and social laws
protecting the rights ~pf workers,
including migrant workers;'
2. It is a signatory to and/or a ratifier of
multilateral conventions, declarations
or resolutions relating to the
protection of workers, including
migrant workers; and
3. It has concluded a bilateral
agreement or arrangement with the
government on the protection of the
rights of OFWs .. (Sec. 3, R.A. 10022
amending R.A. 8042)
Provided, that the receiving country is taking
positive, concrete measures to protect the
rights of migrant workers in furtherance of any
of the guarantees.
Note: In the absence of a clear showing that any
of the guarantees exists in the country of
destination of the migrant workers, no permit for
deployment shall be issued bythe POEA.
Q: What is the rule on repatriation?
A:
GR: The repatriation of the:
1. Worker and the transport of his
personal belongings - shall be the
primary responsibility of the agency
which recruited or deployed the
worker overseas.
Workers Welfare Administration, in
coordination with appropriate
international agencies, shall take
charge of the repatriation. (Sec. 15,
R.A. 8042)
Q: What is the rule on mandatory
repatriation of underage migrant workers?
A: Upon discovery or being informed of the
presence of migrant workers whose ages fall
below the minimum age requirement for
overseas deployment, the responsible officers
in the foreign service shall without delay
repatriate said workers and advise the DFA
through the fastest means of communication
available of such discovery and other relevant
information. The license of a
recruitment/manning agency which recruited or
deployed an underage migrant worker shall be
automatically revoked and shall be imposed a
fine of not less than P500,000 but not more
than P1,000,000. (Sec. 9, R.A. 10022)
Q: What are the regulatory and
adjudicatory functions of the POEA?
A:
1. Regulatory - It regulates the private
sector participation in the recruitment
and overseas placement of workers
through its licensing and registration"
system.
2. Adjudicatory
a. Administrative cases involving
violations of licensing rules and
regulations and registration of
recruitment and employment
agencies or entities
b. Disciplinary action cases and
other special cases which are
administrative in character
involving employers, principals,
contracting partners and Filipino
migrants.
Q: What are the grounds for disciplinary
action?
2. Remains and transport of the
personal belongings of a deceased A: Under R.A. 8042, these are:
worker and all costs attendant thereto 1. Prostitution
shall be borne by the principal 2. Unjust refusal to depart for the
and/or the local agency. worksite
XPNs: 3. Gunrunning or possession of deadly
1. If the termination of employment is weapons
due solely to the fault of the worker, 4. Vandalism or destroying company
the principall Er or agency shall not property
be responsible for the repatriation of 5. Violation of the laws and sacred
the former andlor his belongings practices of the host country and
2. In cases of war, epidemic, disaster or unjustified breach of employment
calamities, natural or man-made, and contract
other similar event, and where the 6. Embezzlement of funds of the
principal or recruitment agency company or fellow worker entrusted
cannot be identified, the Overseas for delivery to relatives, in the Phils.
UNIVERSITY OF SANTO TOMAS ~" 'l9
Pacu[ taa ae i 1)er ecl i o CiviC
7. Creating trouble at the worksite or in
the vessel
8. Gambling
9. initiating or joining a strike or work
stoppage where the laws of the host
country prohibits strikes or similar
actions
10. Commission of felony punishable by
Philippine laws or by the host country
11. Theft or robbery
12. Drunkenness
13. Drug addiction or possession or
trafficking of prohibited drugs
14. Desertion or abandonment
Q: What is the distinction between the
jurisdiction ofthe LA and POEA?
jurisdiction over:
1.All cases which are
administrative in character
relating to licensing and
registration of recruitment
and employment agencies
Original and
exclusive
jurisdiction over all
claims arising out of
Er-Ee relationship
or byvirtue of any
lawor contract
involving OFWs
including claims for:
1. Actual
2. Moral
3. Exemplary
4. Other forms of
damages. (Sec.
10, R.A. 8042)
2.Disciplinary Action
cases and other special
cases, which are
administrative in
character, involving Ees,
principals, contracting
partners and Filipino
migrant workers. (Rule
VII, Book VII, POEA
Q: A seafarer was prevented from leaving
the port of Manila and refused deployment
without valid reason. His POEA-approved
employment contract provides that the
employer-employee relationship shall
commence only upon the seafarer's actual
departure from the port in the point of hire.
Is the seafarer entitled to relief under the
Migrant Workers' Act, in the absence of an
employer-employee relationship?
A: Yes. Despite the absence of an
employer-employee relationship, the NLRC
has jurisdiction over the seafarer'S complaint.
The jurisdiction of labor arbiters is not limited
to claims arising from Er-Ee relationships. Sec.
10 of the Migrant Workers Act provides that
the labor arbiters shall have jurisdiction over
claims arising out of an Er-Ee relationship or
by virtue of any law or contract involving
Filipino workers for overseas deployment
including claims for actual, moral, exemplary
and other forms of damages. Since the
10
present case involves the employment
contract entered into by petitioner for overseas
employment, his claims are cognizable by the
labor arbiters of the NLRC. (Santiago v. CF
Sharp Crew Management,G.R. No. 162419,
July 10, 2007)
Q: What matters fall outside the jurisdiction
of the POEA?
A:
1. Foreign judgments - such claim must
be brought before regular courts.
POEA is not a court; it is an
administrative agency, exercismq
adjudicatory or quasi-judicial
functions.
2. Torts - falls under the provisions of
the Civil Code.
, .' ART. 18.BAN ON DIRECT HIRING
Q: What is the ban on direct-hiring?
A:
GR: An Er may only hire Filipino worker for
overseas employment through POEA or
entities authorized by DOLE.
XPN:
Direct hiring by
1. International organizations
2. Name hires
3. Members of the diplomatic
organizations
4. Other Ers as may be allowed by
DOLE
Reasons:
1. To ensure the best possible terms
and conditions of employment for the
worker.
2. To assure the foreign Er that he hires
only qualified Filipino workers.
3. To ensure full requlation of
employment in order to avoid
exploitation.
Q: May the POEA, at any time terminate or
impose a ban on employment of migrant
workers?
A: Yes, in consultation with the DFA based on
the ft. grounds:
1. In pursuit of the National Interest or
2. When public welfare so requires.
(Sec. 4 R.A. 10022)
Q: What is the liability of the private
employment agency and the principal or
foreign-based employer?
A: They are jointly and severally liable for any
violation of the recruitment agreement and the
contracts of employment.
Note: This joint and solidary liability imposed by
law against recruitment agencies and foreign Ers
is meant to assure the aggrieved worker of
immediate and sufficient payment ~f what is due
him. If the recruitmenUplacement agency is a
juridical being, the corporate officers and
directors and partners as the case may be, shall
themselves be jointly and solidarily liable with the
corporation or partnership for the claims and
damages. (Becmen Service Exporter and
Promotion v. Cuaresma, GR. Nos. 182978-79,
April 7, 2009)
Q: What are the minimum conditions/
provisions of overseas employment
contracts?
A:
1. Guaranteed wages for regular hours
and overtime, not lower than the
minimum wage prescribed in all of the
ff:
a. The host country
b. Bilateral agreements or
international conventions ratified
by the host country and the
Philippines
c. The Philippines
2. Free transportation to and from the
worksite or offsetting benefit
3. Free food and accommodation or
offsetting benefit
4. J ust/authorized causes of termination
of the contract or services of the
worker
Note: An agreement that diminishes the Ees pay
and benefits as contained in a POEA-approved
contract is void, unless such subsequent
agreement is approved by the POEA.
ART. 22. MANDATORY REMITTANCE OF
FOREIGN EXCHANGE EARNINGS
Q: What is the rule on remittance of foreign
exchange earnings?
A:
GR: it shall be mandatory for all OFWs to
remit a portion of their foreign exchange
earnings to their families, dependents,
andlor beneficiaries ranging from 50% - 80%
depending on the worker's kind of job. (Rule
VIII, Book III, POEA Rules)
XPN:
1. The worker's immediate family
members, beneficiaries and
dependents are residing with him
abroad
2. Immigrants and Filipino professionals
and employees working with the UN
agencies or specialized bodies
3. Filipino servicemen working in U.S.
military installations. (Resolution No.
1-83, Inter-Agency Committee for
Implementation of E. O.857)
Q: What is the effect of failure to remit?
A:
1. Workers - Shall be suspended or
removed from the list of eligible
workers for overseas employment.
2. Employers - Will be excluded from
the overseas employment program.
Private employment agencies shall
face cancellation or. revocation of
their licenses or authority to recruit.
(Sec. 9, E.O. 857)
CHAPTER II
REGULATIONS OF RECRUITMENT AND'
PLACEMENT ACTIVITIES .
. ART. 25. PRIVATE SECTOR
PARTICIPATION IN THE RECRUITMENT
AND PLACEMENT OF WORKERS
Q: What are the entities in the private
sectors that can participate in recruitment
and placement of workers?
A:
1. Shipping or manning agents or
representatives
2. Private recruitment offices
3. Public employment offices
4. Construction contractors if authorized
by the DOLE and Construction
Industry Authority.
5. Persons that may be authorized by
the SLE
6. Private employment agencies. (Sec.
t, Rule VII, Book I, IRR)
Pacu{ tatI ti e cJJer ecno CiviC
~~-~11
."
Q: What are the qualifications, for
participation in recruitment and placement
of workers? '
A:
1, Filipino citizens, partnerships or
corporations at least 75% of the
authorized capital stock of which is
owned and controlled by Filipino
citizens; (Art, 27, LC)
2. Capitalization
a. Single proprietorship or
partnership
-A minimum capitalization of P2
million
b. Corporation
-A minimum paid-up capital of P2
million
Provided, that those with existing
licenses shall, within 4 yrs from the
effectivity hereof, increase their
capitalization or paid up capital, as
the case may be, to P2 million at the
rate of P250,000.00 every year. (Art.
28, LC)
3, Not otherwise disqualified by law or
other government regulations to
engage in the recruitment and
placement of workers for overseas
employment. (Rule I, Part II, POEA
Rules)
4. Payment of registration fees
5, Posting of surety/cash bonds
Q: How will POEA regulate private sector
participation in the recruitment and
overseas placement of workers?
A: By setting up a licensing and registration
system. (Sec. 14, R.A. 10022)
Q: Is a corporation, 70% of the authorized
and voting capital of which is owned and
controlled by Filipino citizens, allowed to
engage in the recruitment and placement of
workers, locally or overseas? Explain
briefly.
A: No. It is because Art, 27 of the Labor Code
requires at least 75%. (2002 Bar Question)
Q: Who are disqualified to engage in the
business of recruitment and placement of
workers?
A:
1. Travel agencies and sales agencies
of airline companies; (Art. 26, LC)
12
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 RA 8042, PD. 442
as amended and their
implementing rules and
regulations as well as these rules
and regulations,
5. Any official or Ee of the DOLE,
POEA, OWWA, DFA and other
government agencies directly
involved in the implementation of RA
8042 and/or any of his/her relatives
within the 4t~ 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)
:~.__ -c- ART. 26. TRAVEL AGENCIES'-
PROHIBITED TO RECRUIT
Q: What is the rule on recruitment of travel
agencies and sales agencies of airline
companies?
A: They are prohibited from engaging in the
business of recruitment and placement of
workers for overseas employment whether for
profit or not.
~~ ~
Q: w:rTA is a well-known travel agency and
an authorized sales agent of the PAL. Since
majority of its passengers are overseas
workers, WTTA applied for a license for
recruitment and placement activities. It
stated in its application that its purpose is
not for profit but to help Filipinos find
employment abroad. Should the application
be approved?
A: The application should be disapproved, as
it is prohibited by Art. 26 of the LC, to wit: "Art
26. Travel agencies and sales agencies of
airline companies are prohibited from
engaging in the business of recruitment and
placement of workers for overseas
employment whether for profit or not." Rule I,
Part II POEA Rules and Regulations
Governing the Recruitment and Employment
of Land-Based Workers (2002) disqualifies any
entity having common director or owner of
travel agencies and sales agencies of airlines,
including any business entity from the
recruitment and placement of Filipino workers
overseas, whether they derive profit or not.
(2006 Bar Question)
Q: Is the license or authority transferable?
A: No, they are non-transferable. (Art. 29)
Q: A Recruitment and Placement Agency
declared voluntary bankruptcy. Among its
assets is its license to engage in business.
Is the license of the bankrupt agency an
asset which can be sold in public auction
by the liquidator?
A: No, because of the non-transferability of the
license to engage in recruitment and
placement. The LC (Art. 29) provides that no
license to engage in recruitment and
placement shall be used directly or indirectly
by any person other than the one in whose
favor it was issued nor may such license be
transferred, conveyed or assigned to any other
person or entity. It may be noted that the grant
of a license is a governmental act by the
DOLE based on personal qualifications, and
citizenship and capitalization requirements.
(Arts. 27-28, LC). (1998 Bar Question)
Note: Change of ownership or relationship of a
single proprietorship licensed to engage in
overseas employment shall cause the automatic
revocation of the license.
ART. 32. FEES TO BE PAID' BY WORKERS
Q: When maya worker be charged any fee?
A: Only when:
1. He has obtained work through
recruiter's efforts, and
2, The worker has actually commenced
working
Note: A land based agency may charge and
collect from its hired workers a placement fee in
an amount equivalent to 1 month salary,
exclusive of documentation costs.
Q: What are the only authorized payments
that may be collected from a hired worker?
A:
1. Placement fee in an amount
equivalent to one month's salary of
the worker and
2. Documentation costs.
. ART. 34..PROHIBITED~PRACTICES
Q: What are prohibited practices in
recruitmentl placement?
A:
1. Furnishing or publishing any false
notice/information/document related
to recruitment/employment
2. Failure to file reports required by
SLE
3. Inducing or attempting 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
4. Recruitment/placement of workers in
jobs harmful to public health or
morality or to the dignity of the
country
5, Engaging directly or indirectly in the
management of a travel agency
6, Substituting or altering employment
contracts without approval of DOLE
7. Charging or accepting any amount
greater than that specified by DOLE
UNIVERSITY OF SANTO TOMAS ~. 13
Pacu(taa ae Ver ecno CiviC
or make a worker pay any amount
greater than actually received by him
8. Committing any act of
misrepresentation to secure a license
or authority
9. Influencing or attempting to influence
any person/entity not to employ any
worker who has not applied of
employment through his agency
10. Obstructing or attempting to obstruct
inspection by SLE or by his
representatives
11. Withholding or denying travel
documents from applicant workers
before departure for monetary
considerations other than authorized
by law
12. Granting a loan to an OPN which will
be used for payment of legal and
allowable placement fees
13. Refusing to condone or renegotiate a
loan incurred by an OPN after his
employment contract has been
prematurely terminated through no
fault of his or her own
14. For a suspended
recruitment/manning agency to
engage in any kind of recruitment
activity including the processing of
pending workers' applications; and
15. For a recruitment/manning agency or
a foreign principal/ Er to pass on the
OPN 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
16. Imposing a compulsory and exclusive
arrangement whereby an OPN is
required to:
a. Avail a loan only from specifically
designated institutions, entities or
persons
b. To undergo health examinations
only from specifically designated
medical, entities or persons,
except seafarers whose medical
examination cost is shouldered
by the shipowner
c. To undergo training of any kind
only from designated institutions,
entities or persons, except for
recommendatory trainings
mandated by
principals/shipowners. (Sec. 6,
R.A. 10022)
14
ART. 35. SUSPENSION AND/OR
CANCELLATION OF LICENSE OR
AUTHORITY ,
Q: Who is a non-licensee I non-holder of
authority?
A: Any person, corporation or entity:
1. Which has not been issued a valid
license or authority to engage in
recruitment and placement by the
Secretary of Labor and Employment
(SLE) or
2. Whose license or authority has been
suspended, revoked or cancelled by
the POEA or the SLE
Q: What are the grounds for revocation of
license?
A:
1. Incurring an accumulated 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
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)
Q: What are the grounds for suspension or
cancellation of license?
A:
1. Prohibited acts under Art. 34
2. Publishing job announcements w/o
POEA's approval
3. Charging a fee which may be in
excess of the authorized amount
before a worker is employed
4. Deploying workers w/o processing
through POEA
5. Recruitment in places outside its
authorized area. (Sec. 4, Rule II,
Book IV, POEA Rules)
Q: Concerned Filipino contract workers in
the Middle East reported to the DFA that
XYZ, a private recruitment and placement
agency, is covertly transporting extremists
to terrorist training camps abroad.
Intelligence agencies of the gov't allegedly
confirmed the report. Upon being alerted
by the DFA, the DOLE issued orders
cancelling the licenses of XYZ, and
imposing an immediate travel ban on its
recruits for the Middle East. XYZ appealed
to the Office of the President to reverse and
set aside the DOLE orders, citing damages
from loss of employment of its recruits,
and violations of due process including
lack of notice and hearing by DOLE. The
DOLE in its answer claimed the existence
of an emergency in the Middle East which
required prompt measures to protect the
life and limb of OFWs from a clear and
present danger posed by the 0Qgoing war
against terrorism. Should the DOLE orders
be upheld or set aside?
A:
1. The DOLE order cancelling the
licenses of XYZ is void because a
report that an agency is covertly
transporting extremists is not a valid
ground for cancellation of a
Certificate of Registration (Art. 239,
LC and there is failure of due process
as no hearing was conducted prior to
the cancellation (Art. 238, LC).
2. The DOLE order imposing the travel
ban is valid because it is a valid
exercise of police power to protect
the national interest (Sec. 3, Art. XIII,
Constitution on full protection to labor
safety of workers) and on the rule
making authority of the SLE. (Art. 5,
LC; Phil. Ass'n. of Service Exporters
v. Drilon, G.R. No. 81958, June 30,
1988). (2004 Bar Question)
" CHAPTER 111-
i MISCELLANEOUS PROVISIONS
ART. 36. REGULATORY POWERS
Q: What are the regulatory powers of the
Secretary of Labor and Employment (SLE)?
A:
1. Restrict and regulate the recruitment
and placement activities of all
agencies
2. Issue orders and promulgate rules
and regulations
ART. 38. ILLEGAL RECRUITMENT
Q: Who are the persons prohibited from
engaging the business of recruiting
migrant workers?
A:
1. Unlawful for any official or Ee of the:
a. DOLE
b. POEA
c. Overseas Workers Welfare
Administration (OWWA)
d. DFA
e. Other gov't agencies involved in
the implementation of this Act
2. Their relatives within the 4th civil
degree of consanguinity or affinity, to
engage, directly or indirectly in the
business of recruiting migrant
workers. (Sec. 8, R.A. 8042)
Q: What are the elements of illegal
recruitment?
A:
1. Offender is a non-li~nsee or non-
holder of authority to lawfully engage
in the recruitmenUplacement of
workers
2. Offender undertakes:
a. Any act of canvassing, enlisting.
contracting, transporting,
utilizing, hiring or procuring
workers, and includes referrals,
contact services, promising or
advertising for employment,
locally or abroad, whether for
profit or not (Art. 13[bJ) or
b. Any of prohibited practices under
Art. 34
Q: Larry Domingo was accused of the
crime of illegal recruitment. He argued that
he issued no receipt or document in which
he acknowledged as having received any
money for the promised jobs. Hence, he
should be free him from liability. Was Larry
engaged in recruitment activities?
A: Yes. Even if at the time Larry was
promising employment no cash was given to
him, he is still considered as having been
engaged in recruitment activities, since
Art.13(b) of the LC states that the act of
recruitment may be for profit or not. It suffices
that Larry promised or offered employment for
a fee to the complaining witnesses to warrant
his conviction for illegal recruitment. (People v.
Domingo, G.R. No. 181475, April 7, 2009, .J.
Carpio- Morales)
UNIVERSITY OF SANTO TOM.A~ ,,~ 15
Pacu{ taa ae (] )er eChO Ct'ln{ .
Q: What is the difference between the LC
and R.A. 8042 or the Overseas Filipinos
and Overseas Migrant Workers Act?
A:
L
c(Art 38) R.A. 8042,as amendedby
. 'RA 10022 '. .
Local recruitment
Applies to recruitment for
overseas employment
Illegal recruitment
under Art 38
means any
recruitment
activity including
prohibited acts
under Art. 34
committed by non-
licensees or non-
holders of
authority.
Illegal recruitment under
Sec. 6 means any
recruitment activity
committed by non-
licensees/ non-holders of
authority or prohibited acts
(same as Art. 3~,l.C)
Added to the following in
the list of prohibited acts:
1. Failure to actually
deploy without valid
reason;
2. Failure to reimburse
expenses incurred by
the worker in
connection with his/her
documentation and
processing for
purposes of
deployment;
3. To allow a non-Filipino
citizen to head or
manage a licensed
recruitmenV manning
agency.
Q: How does one prove illegal recruitment?
A: It must be shown that the accused gave the
distinct impression that he had the power or
ability to send complainants abroad for work
such that the latter were convinced to part their
money in order to be deployed.
Q: Maya licensee or holder of authority be
held liable for illegal recruitment?
A: Yes, any person (whether non-licensee,
non-holder of authority, licensee or holder of
authority) who commits any of the prohibited
acts, shall be liable for l\Iegal recruitment.
(R.A. 8042)
Q: When is illegal recruitment considered
as economic sabotage?
A: When it is committed:
16
1. By a syndicate - carried out by 3 or
more persons
conspiring/confederating with one
another or
2. In large scale - committed against 3
or more persons individually or as a
group. (Sec. 6, 10022)
Q: While her application for renewal of her
license to recruit workers for overseas
en1nlovemntwas still Dendina Marvrose
G~~d-'; -~~~~~ited- AI~a, ~nd he~ 3 si~ters,
Ana, J oan, and Mavic, for employment as
housemates in Saudi Arabia. Maryrose
represented to the sisters that she had a
license to recruit w9rkers for overseas
employment and demanded and received
P30,OOO.OO from each of them for her
services. However, her application for the
renewal of her license was denied, and
consequently failed to employ the 4 sisters
in Saudi Arabia. The sisters charged
Maryrose with large scale illegal
recruitment. Testifying in her defense, she
declared that she acted in good faith
because she believed that her application
for the renewal of her license would be
approved. She' adduced in evidence the
Affidavits of Desistance which the four
private complainants had executed after
the prosecution rested its case. In the said
affidavits, they acknowledge receipt of the
refund by Maryrose of the total amount of
P120,OOO.00 and indicated that they were
no longer interested to pursue the case
against her. Resolve the case with reasons.
A: l\Iegal recruitment is defined by law as any
recruitment activities undertaken by non-
licenses or non-holders of authority. (People v.
Senoron, G.R. No. 119160, Jan. 30,1997) And
it is large scale illegal recruitment when the
offense is committed against 3 or more
persons, individually or as a group. (Art. 38[b),
l.C) In view of the above, Maryrose is guilty of
large scale illegal recruitment. Her defense of
GF and the Affidavit of Desistance as well as
the refund given will not save her because
R.A. No. 8042 is a special law, and illegal
recruitment is malum prohibitum. (People v.
Saulo, G.R. No. 125903, Nov. 15, 2000).
(2005 Bar Question)
Q: What is the consequence of conviction of illegal recruitment (IR)?
IR as economic sabotage
Provided:
1. If person illegally recruited is bel~~w18 rears of
~em - .
2. Illegal recruitment is committed by a non-
licensee/non-holder
Life imprisonment +
fine of P2M-P5M
l
J Maximum penalty 'hall be imposed
Any person found guilty of illegal recruitment
12yrs and 1day - 20 yrs imprisonment; or
Fine: P1M-P2M
Any person found guilty of the prohibited acts
6yrs and 1day - 12 yrs imprisonment; or
Fine of P500K - P1M
Licensee/holder of authority violates provisions
yrs imprisonment; or
Fine: P10K - P50K;
or both
Non-licensee/non-holder of authority violates
provisions
4-8 yrs imprisonment; or
Fine: P20K - P1OOK
or both
Corporation, partnership, association, or entity
Penalty imposed upon officer/s responsible for
violation
Alien +
Penalties prescribed under RA 10022,
Deportation without further proceedings
In every case
Automatic revocation of license or authority and all
permits and privileges of the recruitment m manning
agency, lending institutions, training school or medical
clinic
Pacu{ taa de (] )er ecl i o Ci v-i {
C17
.".-
Q: What are the remedies under the Migrant Workers Act and how may they be enforced?
Original and exclusive jurisdiction to hear and decide claims arising out of an Er-Ee relationship or by virtue of
any lawor contract involving Filipino workers for overseas deployment including claims for actual, moral,
exemplary and other forms of damages.
1. The liability of the principal! Er and the recruitmenU placement agency for any and all claims shall bejoint
and several.
2. The performance bond to de filed by the recruitmenU placement agency shall be answerable for all money
claims or damages that may be awarded to the workers.
3. If the recruitmenUplacement agency is ajuridical being, the corporate officers and directors and partners as
the case may be, shall themselves bejointly and solidarily liable with the corporation or partnership for the
claims and damages.
Original and exclusive jurisdiction to hear and decide:
1. All cases which are administrative in character, involving or arising out of violations of rules and regulations
relating to licensing and registration of recruitment and employment agencies or entities and
2. Disciplinary action (DA) cases and other special cases which are administrative in character, involving Ers,
principals, contracting partners and Filipino migrant workers.
a.lt may be filed with the POEA Adjudication Office or the DOLEIPOEA regional office of the place where
the complaint applied or was recruited at the option of the complainant. The office with which the
complaint was first filed shall take cognizance of the case.
b. DA cases and other special cases, as mentioned inthe preceding Section, shall be filed with POEA
Adjudication Office.
Within 5 yrs from the time illegal recruitment has
happened
Within 20 yrs fromthe time illegal recruitment has
happened. (Sec. 12,R.A. 8042)
18
Q: Can SLE issue search warrants or
warrants of arrest?
A: No. Only a judge may issue search and
arrest warrants. Art 38 (c) of the Labor Code is
unconstitutional inasmuch as it gives the SLE
the power to issue search or arrest warrants.
The labor authorities must go through the
judicial process.
Q: Is compromise agreement on money
claims allowed?
A: Yes. Consistent with the policy encouraging
amicable settlement of labor disputes, Sec. 10
of R.A. 8042 allows resolution by compromise
of cases filed with the NLRC.
Q: When shall compromise agreements on
money claims be paid?
A: Any compromise/amicable settlement or
voluntary agreement on money claims
inclusive of damages shall be paid within 4
months from the approval of the settlement by
the appropriate authority.
Q: Serrano, a seafarer, was hired by Gallant
Maritime and Marlow Navigation Co. for 12
months as Chief Officer. On the date of his
departure, he was constrained to accept a
downgraded employment contract for the
position of Second Officer, upon the
assurance that he would be made Chief
Officer after a month. It was not done;
hence, he refused to stay on as Second
Officer and was repatriated to the Phi/so He
had served only 2 months & 7 days of his
contract, leaving an unexpired portion of 9
months & 23 days.
Serrano filed with the LA a Complaint
against Gallant Maritime and Marlow for
constructive dismissal and for payment of
his money claims. The LA rendered a
favorable decision to Serrano awarding him
$8,770.00, representing his salary for 3
months of the unexpired portion of his
contract of employment applying R.A.
8042, Sec 10, par 5:
Money Claims. In case of termination of
overseas employment without just, valid or
authorized cause as defined by law or
contract, the workers shall be entitled to
the full reimbursement of his placement fee
with interest of 12% per annum, plus his
salaries for the unexpired portion of his
employment contract or for 3 months for
every year of the unexpired term,
whichever is less.
Is the subject clause constitutional?
A: No. The subject clause contains a suspect
classification in that, in the computation of the
monetary benefits of fixed-term employees
who are illegally discharged, it imposes a 3-
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
and other OFWs 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.
Furthermore, prior to R.A. 8042, all OFWs,
regardless of contract periods or the unexpired
portions thereof, were treated alike in terms of
the computation of their monetary benefits in
case of illegal dismissal. Their claims were
subjected to a uniform rule of computation:
their basic salaries multiplied by the entire
unexpired portion of their employment
contracts. The same applies local workers with
fixed-term employment.
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 RA 8042. (Serrano v. Gal/ant Maritime
Services & Marlow Navigation Co., Inc., G.R.
No. 167614, Mar.24, 2009)
Do OT and leave pay form part of the salary
basis in the computation of the monetary
award?
A: No. The word salaries in Sec. 10(5) does
not include overtime and leave pay. For
seafarers, DOLE Department Order No. 33,
series 1996, provides a Standard Employment
Contract of Seafarers, in which salary is
understood as the basic wage, exclusive of
OT, leave pay and other bonuses; whereas OT
pay is compensation for all work "performed" in
excess of the regular 8hours, and holiday pay
is compensation for any work "performed" on
designated rest days and holidays.
(Serrano v. Gal/ant Marffime Services &
Marlow Navigation Co., Inc., G.R. No. 167614,
Mar. 24, 2009)
UNIVERSITY OF SANTO TOMAS ~i."~ 19
PacuCtaa ae (] )er ecfi o Ci vi C
, EMPLOYMENT OF NON-RESIDENT ALIENS
Q: What is required in the employment of
non-resident aliens?
A: Any alien seeking admission to the Phil. for
employment purposes and any domestic or
foreign employer (Er) who desires to engage
an alien for employment in the Philippines:
1. Shall obtain an employment permit
from the DOLE
') Th"" ~"r.....,i+~''''U' hI"\, iro~II""\I'~ +'" .." nn.. L
L... 111e; POIIIIIL IllaJ LI'Ci I.;:)..:;J UGU \.\oJ CA:IIVII-
resident alien or to the applicant Er
after a determination of the non-
availability of a person in the Phil.
who is competent, able and willing at
the time of application to perform the
services for which the alien is desired
3. For an enterprise registered in
preferred areas of investments, said
permit may be issued upon
recommendation of the gov't agency
charged with the supervision of said
registered enterprise
Q: The DOLE issued an alien employment
permit for Earl Cone, a U.S. citizen, as
sports consultant and assistant coach for
GMC. Later, the Board of Special Inquiry of
the Commission on Immigration and
Deportation approved Cone's application
for a change of admission status from
temporary visitor to pre-arranged
employee. A month later, GMC requested
that it be allowed to employ Cone as full-
fledged coach. The Dole Regional Director
granted the request. The Basketball
Association of the Phils. appealed the
issuance of said permit to the SLE who
cancelled Cone's employment permit
because GMC failed to show that there is
no person in the Philippines who is
competent and willing to do the services
nor that the hiring of Cone would redound
to the national interest. Is the act of SLE
valid?
A: Yes. GMC's claim that hiring of a foreign
coach is an Er's prerogative has no legal
basis. Under Art. 40 of the LC, an Er seeking
employment of an alien must first obtain an
employment permit from the DOLE. GMC's
right to choose whom to employ is limited by
the statutory requirement of an employment
permit. (GMC v. Torres, G.R. No. 9366, April
22, 1991)
20
: ART. 41. PROHIBITION AGAINST
l TRANSFER OF EMPLOYMENT .
Q: Who .are required to obtain an
employment permit?
A:
GR: Only non-resident aliens;
XPNS:
-1-.-Diplomatic services and foreign gov't
offlcials
2. Officers and staff of int'I organizations
and theirdeqitimate spouses
3. Members of governing board who has
voting rights only
4. Those exempted. by special laws
5. Owners and representatives of
foreign principals who interview
Filipino applicants for employment
abroad
6. Aliens whose purpose is to teach,
present and/or conduct research
studies
7, Resident aliens. (D.O. 75-06, May 31,
2006)
Q: What is required for immigrants and
resident aliens?
A: An Alien Employment Registration
Certificate.
Q: What is the duration of the employment
permit?
A:
GR: Minimum of 1year
XPN: Unless revoked and subject to
renewal
Q: May aliens be employed in entities
engaged in nationalized activities?
A:
GR: No.
XPNS:
1. Sec. of J ustice specifically authorizes
the employment of technical
personnel
2. Aliens are elected members of the
board of directors or governing body
of corporations or associations or
3. Enterprises registered under the
Omnibus Investment Code in case of
technical, supervisory or advisory
positions, but for a limited period.
1. In school training - the trainee is
taught of the theoretical foundation,
basic training, guidance, and human
foundation
2. In plant training - the trainee is given
the opportunity to develop his skills
and proficiency in actual work
PacuCtati ti e (] )er ecl i o Ci1JiC
BOOK TWO
.HUMAN RESOURCES DEVELOPMENT
'/PROGRAM TRAINING AND EMPLOYMENT
OFSPECIAL WORKERS
Q: What is human resource development
(HRO)?
A: It refers to the process by which the actual
and potential labor force is made
systematically to acquire greatw kno'J ,!!edge,
skills, and capabilities for the nation's
sustained economic and social growth.
Q: What is the rationale of HRD?
A: It will produce skilled workers. With the
abundance of skilled workers, labor industry
can operate efficiently; hence, economic
stability and growth will be sustained.
Note: HRD is not intended solely for the purpose
of training workers to serve employers; it also
means training for self-employment or
entrepreneurship.
Q: What is the agency tasked to regulate
HRD?
A: Technical Education and Skills
Development Authority (TESDA). It is the body
created under R.A. 7796 to replace and
absorb the National Manpower and youth
Council, the Bureau of Technical and
Vocational Education as well as the
apprenticeship program of the DOLE. (R.A.
7796)
Q: What are the powers and functions of
TESDA?
A: It is responsible for formulating, continuing
coordinating and fully integrating technical
education and skills development policies,
plans and programs.
Q: What is dual system/training?
A: It refers to a delivery system of quality
technical and vocational education which
requires training to be carried out alternately in
2 venues, in school and in the actual
production or plant area.
conditions as it continues personal
discipline and values.
Q: What is manpower?
A: It means that portion of the nation's
population which has actual or potential
capability to contribute directly to the
production of goods and services.
Q: What is entrepreneurship?
A: It means training for self-employment or
assisting individual or small industries.
TITLE II .
TRAINING AND EMPLOYMENT
- OF SPECIAL WORKERS
Q: Who are special workers?
A:
1. Apprentices
2. Learners
3. Handicapped workers
Q: What are their conditions of their
employment?
A:
1. Work shall not exceed 8 hours per
day
2. OT allowed, but with pay
, CHAPTER I
APPRENTICES ,
ART. 58. DEFINITION OF TERMS
Q: Who is an apprentice?
A: Any worker who is covered by a written
apprenticeship agreement with an individual
employer or any of the entities recognized
under the LC.
Q: What is apprenticeship?
A: It is practical
supplemented by
instruction,
training on the job
reiated theoretical
Q: What is an apprenticeable occupation?
A: That which requires more than 3 months of
practical training with theoretical instruction
Q: What is on the job training (OJ T)?
LABOR STANDARDS: SPECIAL WORKERS
A: It is practical work experience through
actual participation in productive activities
given to or acquired by an apprentice.
Q: What are highly technical industries?
A: Those which are engaged in the application
of advanced technology.
Q: What are
instructions?
related theoretical
A: Technical information based on
apprenticeship standards approved by the
Bureau.
Note: Prior approvai by TESDA (formerly DOLE)
of the proposed apprenticeship program is a
condition sine qua non. Otherwise, apprentice
becomes a regular Ee. (Nitto Enterprises v.
NLRC, G.R. No. 114337, Sep. 29, 1995).
ART. 59.QUALIFICATIONS OF
APPRENTICE
Q: What are the qualifications of an
apprentice?
A:
1. At least 15yrs of age
Note: Those below 18 years of age
shall not work in hazardous occupations
2. Physically tit for the occupation
3. Possess vocational aptitude and
capacity
4. Possess:
a. The ability to comprehend, and
b. Follow oral and written
instructions
5. The company must have an
apprenticeship program duly
approved by the DOLE.
Note: Trade and industry associations may
recommend to the SLE appropriate educational
requirements for different occupations.
Q: When is an occupation deemed
hazardous?
A:
1. Nature of work exposes worker to
dangerous environmental elemental
contaminants or work conditions
2. Workers are engaged in construction
work, logging, firefighting, mining,
quarrying, blasting, stevedoring,
deep-sea fishing, and mechanized
farming
22
3. Workers are engaged in the
manufacture or handling of
explosives and other pyrotechnic
products
4. Workers use, or are exposed to
heavy or power-driven machinery or
equipment.
ART. 60. EMPLOYMENT OF APPRENTICES
Q: Who may empioy appfwiitices?
A:
1. Only employers in highly technical
industries and
2. Only in apprenticeable occupations
approved by SLE
Q: What is the employment status of
apprentices?
A: They are contractual workers whose length
of service depends on the term provided for in
the apprenticeship agreement. Thus, the
employer is not obliged to employ the
apprentice after the completion of his training.
Q: What Is the period of apprenticeship?
A: Must not exceed 6 months:
1. 2 monthsl400 hours: Trades or
occupations which normally require 1
year or more for proficiency
2. 1monthl200 hours: Occupations and
jobs which require more than 3months
but less than 1 year for proficiency.
(Sec. 19, Rule VI, Book II, IRR)
Q: What is the status of an apprentice hired
after such term?
A: He is deemed a regular Ee. He cannot be
hired as a probationary Ee since the
apprenticeship is deemed the probationary
period.
Q: What is the wage rate of an apprentice?
A: Start at not less than 75% of the statutory
minimum wage for the 1
s1
6 months (except
OJT); thereafter, shall be paid in full minimum
wage, including the full COLA.
Note:
!iB: Apprenticeship programs shall be
primarily voluntary
XPN: Compulsory apprenticeship:
1. National security or economic
development so demand, the President
may require compulsory training
2. Services of foreign technicians are
utilized by private companies in
apprenticeable trades.
r ART. 61.CONTENTS OF- APPRENTICESHIP
-' AGREEMENTS
Q: What are the rules regarding
apprenticeship agreements?
A: Apprenticeship aqreernentss including the
wage rates of apprentices, shall: '.
1. Conform to the rules issued by SLE.
2. The period of apprenticeship shall not
exceed 6 months.
3. Apprenticeship agreements providing
for wage rates below the legal
minimum wage, which in no case
shall start below 75% of the
applicable min. wage, may be
entered into only in accordance with
apprenticeship programs duly
approved by the SLE.
4. The DOLE shall develop standard
model programs of apprenticeship.
(Sec. 18, Rule VI, Book II, IRR)
ART. 62. SIGNING OF APPRENTICESHIP
. AGREEMENTS
Q: Who signs the apprenticeship
agreement?
A: Every apprenticeship agreement shall be
signed by:
1. The employer or his agent, or
2. An authorized representative of any
of the recognized organizations,
associations or groups, and
3. The apprentice.
Q: Who will sign if the apprentice is a
minor?
A: An apprenticeship agreement with a minor
shall be signed in his behalf by:
1. His parent or guardian, or if the latter
is not available,
2. An authorized representative of the
DOLE.
ART. 72. APPRENTICESHIP WITHOUT
COMPENSATION
- -
Q: May apprentices be hired without
compensation?
A: Required:
1. By school
2. By the training program curriculum
3. For Graduation
4. For board examinations
Q: What are the rules on working scholars?
A: There is no Er-Ee relationship between
students on one hand, and schools, where
there is written aqreernent between them
under which the former agree to work for the
latter in exchange for the privilege to study free
of charge. The student is not considered an
Ee. (Sec. 14, Rule IX, Book III, IRR)
Q: Padilla entered into a written agreement
with Gomburza College to work for the
latter in exchange for the privilege of
studying in said institution. His work was
confined to keeping clean the lavatory
facilities of the school. One school day, he
got into a fist fight with a classmate,
Monteverde, as a result of which the latter
sustained a fractured arm. Victor filed a
civil case for damages against him,
impleading Gomburza College due to the
latter's alleged liability as his Er. Under the
circumstances, could Gomburza College be
held liable by Victor Monteverde as an
Padilla's Er?
A: Gomburza College is not liable for the acts
of Padilla because there is no Er-Ee
relationship between them. As provided in the
Rules and Regulations Implementing the LC
"there is no Er-Ee relationship between
students on one hand, and schools, colleges,
or universities on the other, where students
work with the latter in exchange for the
privilege to study free of charge, provided the
students are given real opportunity, including
such facilities as may be reasonable and
necessary to finish their chosen courses under
such arrangement." (1997 Bar Question)
tF acu{ taa de CDer ecno Ci vi C
~
~," 23
1{J '
r ART. 65. VIOLATION OF APPRENTICESHIP
AGREEMENT .
Q: Who may terminate an apprenticeship
agreement?
A:
1. Either party may terminate an
agreement after the probationary
period but only for a valid cause.
2. It may be initiated by either party
upon filing a complaint or upon
DOLE's own initiative.
~ ART. 66. APPEAL
Q: Who may appeal the decision of the
authorized agency of the DOLE?
A: It may be appealed by any aggrieved
person to the SLE within 5days from receipt of
the decision.
Note: The decision of the SLE shall be final and
executory.
:. . ART. 67. EXHAUSTION OF., - "
'. ADMINISTRATIVE REMEplES (EAR) .
Q: What is EAR?
A: It is a condition precedent to the institution
of action. (Sec. 32b, Rule VI, Book II, IRR)
Q: How is the principle of EAR applied in
case of breach of apprenticeship
agreement?
A: 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.
Q: Who shall settle differences arising out
of apprenticeship agreement?
A: The plant apprenticeship committee shall
have the initial responsibility for settling
differences arising out of apprenticeship
agreement. (Sec. 32b, Rule VI, Book II, IRR)
Q: What is the procedure for the
termination of apprenticeship?
A: The party terminating shall:
1. Serve a written notice on the other at
least 5 days before actual
termination,
24
2. Stating the reason for such decision;
and
3. A copy of said notice shall be
furnished the Apprenticeship Division
concerned.
"-" " " ' . CtfAPIER II '- "' "" *"~,".
~ "...: ,,',' :. I.:iEARNERS'" .;.: " i -.~ .-," : : : ' Ff-';"-:I
" .
Q: Who are learners?
A:
1. They are persons hired as trainees in
semi-skilled and other industrial
occupations
2. Which are non-apprenticeable and
3. Which may be learned through
practical training on the job in a
relatively short period of time
4. Which shall not exceed 3 months
5, Whether or not such practical training
is supplemented by theoretical
instructions. (Sec. 1a, Rule VII, Book
II,IRR)
Q: Distinguish
Apprenticeship.
A:
Learnership from
Training on the job in
semi-skilled and other
industrial occupation or
trades which are non-
apprentice able and
which may be learned
thru practical training on
the job in a relatively
short period of time.
Training intrades
which are
apprenticeable, that
is, practical training
onthejob
supplemented by
related theoretical
instruction for more
than 3months.
Max: 3months
rn"" irl<>rt,ti a reg
if pre-termination occurs
after 2 months of
training and the
dismissal is without fault
of the learner.
Semi-skilled/lndus-trial
occupations
With commitment to
employ the learner as a
regular Ee if he desires
upon completion of
learners hip
Min: 3 months
Max: 6 months
No commitment to
hire
Worker not
considered as regular
employee.
There is a list of
learnable trades by No list
TESDA
"'"
'"
Requires learnership
Requires
Apprentices hip
agreement
Agreement
1>'ARL"74'. WHEN LEARNERS MAY BE HIRED
Q: When may learners be em!?loyed?
v "
A:
1, When no experienced worker is
available
2, It is necessary to prevent curtailment
of employment opportunities; and
3. Employment does not create unfair
competition in terms of labor costs or
impair or lower working standards.
I.. " ART. 75. LEARNERSHIP AGREEMENT _
Q: What is a learners hip agreement?
A: Any employer desiring to employ learners
shall enter into a learnership agreement with
them, which agreement shall include:
1. The names and addresses of the
learners;
2. The duration of the learnership
period, which shall not exceed 3
months;
3. The wages or salary rates of the
learners which shall begin at not less
than 75% of the applicable minimum
wage; and
4. A commitment to employ the learners
if they so desire, as regular
employees upon completion of the
learnership.
Q: What is the qualification of a learner?
A: Must be at least 15years of age.
Note: Those below 18 years of age shall not
work in hazardous occupations.
Q: Who may employ learners?
A: Only employers in semi-skilled and other
industrial occupations which are non-
apprenticeable.
Q: What is the status of learners who have
been allowed or suffered work during the
first 2 months, if training is terminated by
the Er before the end of the stipulated
period through no fault of the learner?
A: They are deemed regular employees. (Sec.
4, Rule VII, Book II, IRR)
. CHAPTER III
, HANDICAPPED WORKERS
Q: Who are handicapped workers (HW)?
A: Those whose earning capacity is impaired
by:
1. Physlcat deficiency
2. Age
3. Injury
4. Disease
5. Mental deficiency
6. Illness
. ART. 80. EMPLOYMENT AGREEMENT
Q: What is the duration of the employment
period of handicapped workers?
A: There is no minimum or maximum duration.
It depends on the agreement but it is
necessary that there is a specific duration
stated.
Q: May handicapped workers be hired as
apprentices or learners?
A: Yes, if their handicap is not such as to
effectively impede the performance of job
operations in the particular occupations for
which they are hired, (Art. 81)
Q: Can a handicapped workers acquire the
status of a regular Ee?
A: Yes, if work is usually or necessarily or
desirable to the business. (Bernardo v. NLRC,
G.R No. 122917, July 12, 1999)
Q: Who may employ handicapped workers?
A: Employers in all industries. Provided, the
handicap is not such as to effectively impede
the performance of job operations in the
particular occupations for which they are hired
' F acu[ taa ae cDer ecfi o Ci vi C
Q: When can handicapped workers be
employed?
A:
1. When their employment is necessary
to prevent curtailment of employment
opportunities and
2. When it will not create unfair
competition in labor costs or lower
working standards. (Art. 79)
Q: Does the mere fact that a worker has a
disability, make him a handicapped
workers?
A: No, because his disability may not impair his
efficiency or the quality of his work. If despite his
disability he can still efficiently perform his work,
he cannot be classified as handicapped; he
would be considered a qualified disabled worker
entitled to the same treatment as qualified able-
bodied workers.
Q: Distinguish handicapped from disabled?
A:
i
Handicapped
Disabled
,. (Differently Ab.led)
Refers to all suffering from
restriction of different
Earningcapacity is
abilities as a result of
impaired byage, or
mental, physical or
physical or mental
sensory impairment to
performan activity inthe
deficiencyor injury.
manner or within range
considered normal for a
human being.
Covers onlyworkers.
Covers all activities or
endeavors.
Basis:
Basis: range of activity
loss/impairment of which is normal for a
earningcapacity. human being.
Loss dueto injuryor
Restriction due to
impairment of
physical or mental
mental/physical! sensory
defect or age.
defect.
If hired, entitledto
75%of minimum
If qualified, entitled to all
wage.
terms and conditions as
Subject todefinite
qualified able-bodied
periods of
person.
employment.
Employable only
Norestrictions on
when necessaryto
employment.
prevent curtailment
of employment
Must get equal opportunity
opportunity. and nounfair competition.
26
Academics Committee
Chai r per son: Abraham D.Genuine II
Vi ce-Chai r for Academi cs: J eannie A.Laurentino
Vi ce-Chai r for Admi n &F i nance: Aissa CelineH.Luna
Vi ce-Chai r for L ayout &Desi gn: Loise RaeG.Naval
Labor LawCommittee
Subj ect H ead: Lester J ay AlanE.FloresII
Assi stant Subj ect H ead' Domingo B.Diviva V
Members:
Rene FrancisP.Batal1a
Diane Camilla R.Borja
Maria Kristina L.Dacayo-Garcia
ChristianNinoA.Diaz
AngeloS.Diolrno
Genesis R.Fulgencio
J eanelleC.Lee
]emuel PaoloM.Lobo
Andrew W.Montesa
Maria Maica A.ngelikaRoman
l : t .1 ' ; t 1I 33: 1
Q: ASIA executed a 1-year contract with the
Baron Hotel (BARON) for the former to
provide the latter with 20 security guards to
safeguard the persons and belongings of
hotel guests, among others. The security
guards filled up Baron application form and
submitted the executed forms directly to
the Security Department of Baron. The pay
slips of the security guards bore BARON's
logo and showed that Baron deducted
CONDITIONS OF EMPLOYMENT
i -, CHAPTER I
;:.:., ,,, "'<~....:.. : HOURS_OE WORK _.. ' _.
Q: Who determines working conditions?
A: Generally, they are detwmine,p by the
employer, as he is usually free to: regulate,
according to his discretion, all aspects of
employment.
Q: What is the limitation on the employer's
power to regulate working conditions?
A: It must be done in good faith and not for the
purpose of defeating or circumventing the
rights of the employees. Such are not always
absolute and must be exercised with due
regard to the rights of labor.
Note: One's employment, profession, trade or
calling is a property right and the wrongful
interferencetherewith is an actionablewrong.
Q: When does the condition on
employment under the Labor Code apply?
A: Only if an Er-Ee relationship exists.
Q: Who are the employees that are covered
by the conditions of employment?
A:
GR: It applies to a\l Ee's in all
establishments.
XPN:
1. Gov't employees
2. Managerial employees
3. Field personnel
4. The employers family members who
depend on himfor support
5. Domestic helpers and persons in the
personal service of another, and
6. Workers who are paid by results as
determined under DOLE regulations
therefrom the amounts for SSS premiums,
medicare contributions and withholding
taxes. Assignments of security guards,
who should be on duty or on call,
promotions, suspensions, dismissals and
award citations for meritorious services
were all done upon approval by BARON's
chief security officer. After the expiration of
the contract with ASIA, BARON did not
renew the same and instead executed
another' contract for security services with
another agency. ASIA placed the affected
security guards on "floating status" on "no
work no pay" basis. Having been displaced
from work, the ASIA security guards filed a
case against the BARON for illegal
dismissal, overtime pay, minimum wage
differentials, vacation leave and sick leave
benefits, and 13th month pay. BARON
denied liability alleging that ASIA is the
employer of the security guards and
therefore, their complaint for illegal
dismissal and payment of money claims
should be directed against ASIA.
Nevertheless, BARON filed a Third Party
Complaint against ASIA.
Is there an Er-Ee relationship between the
BARON, on one hand, and the ASIA
security guards, on the other hand?
Explain briefly.
A: As a general rule, the security guards of a
private security guard agency are the
employees of the latter and not of the
establishment that has entered into a contract
with the private security guard agency for
security services. But under the facts in the
question, Baron Hotel appear to have hired the
security guards, to have paid their wages, to
have the power to promote, suspend or
dismiss the security guards and the power of
control over them, namely, the security guards
were under orders of Baron Hotel as regard
their employment. Because of the above-
mentioned circumstances, Baron Hotel is the
Er of the security guards.
Q: Assuming that ASIA is the Er, is the act
of ASIA in placing the security guards on
"floating status" lawful? Why?
A: It is lawful for a private security guard
agency to place its security guard on a
"floating status" if it has no assignment to give
to said security guards. But if the security
guards are placed on a ''floating status" for
more than 6 months, the security guards may
consider themselves as having been
dismissed. (1999 Bar Question)
If'acu{taa de (])erecno Ci vi C
LABOR STANDARDS: CONDITIONS OF EMPLOYMENT: HOURS OF WORK
Q:Lacson was one of more than 100 Ees
who were terminated from employment due
to the closure of LBM Construction
Corporation. LBM was a sister company of
Lastimoso Construction, Inc. and RL Realty
& Dev't Corp. All 3 entities formed what
came to be known as the Lastimoso Group
of Companies. The 3 corporations were
owned and controlled by members of the
Lastimoso family; their incorporators and
directors all belonged to the Lastimoso
family. The 3 corporations were engaged in
the same line of business, under one
management, and used the same
equipment including manpower services.
Lacson and his co-Ees filed a complaint
with the Labor Arbiter against LBM, RL
Realty and Lastimoso Construction to hold
them jointly and severally liable for
backwages and separation pay. Lastimoso
Construction, Inc. RL Realty &
Development Corporation interposed a
Motion to Dismiss contending that they are
juridical entitles with distinct and separate
personalities from LBM Construction
Corporation and therefore, they cannot be
held jointly and severally liable for the
money claims of workers who are not their
Ees. Rule on the motion to dismiSS. Should
it be granted or denied? Why?
A: It is very clear that even if LBM
Construction company, Lastimoso
Construction Company, Inc. and RL Realty &
Dev't Corp. all belong to the Lastimoso family
and are engaged in the same line of business
under one management and used the same
equipmentincludingmanpower services, these
corporations were separate juridical entities.
Thus, only the LBM Construction Corp. is the
Er of Teofilo Lacson. The other corporation do
not have any Er-Ee relations with Lacson. The
case in question does not include any fact that
would justify piercing the veil of corporate
fiction of the other corporations in order to
protect the rights of workers. In a case
(Concept Builders, Inc. v. NLRC, G.R. No.
108734, May 29, 1996)the SC ruledthat it is a
fundamental principle of corporation lawthat a
corporation is an entity separate and distinct
from its stockholders and from other
corporations towhich it may be connected. But
this separate and distinct personality of a
corporation is merely a fiction created by law
for convenience and to promote justice. So,
when the notion of separate juridical
personality is used to defeat public
convenience, justify wrong, protect fraud or
defend crime, or is used as a device to defeat
the labor laws, this separate personality of the
corporation maybe disregarded or the veil of
28
corporate fiction pierced. (1999 Bar
Question)
Q: What factors determine the existence of
an Er-Ee relationship?
A: The " four-fold test" :
1. Selection and engagement of the
employee;
2. Paymentof wages;
3. Powerof dismissal; and
4. Power of control. (The Labor Code
with Comments and Cases 2007,
AzucenIJ, Vol I, p. 158)
Q: What is control test?
A: The person for whom the services are
performed reserves a right to control not only
the end to be achieved but also the means to
be usedinreachingsuch end.
Note: However,in certaincases the control test
is notsufficientto give a completepictureof the
relationshipbetween the parties, owing to the
complexityof such a relationshipwhereseveral
positions have been held by the worker. The
better approachis to adopt the two-tieredtest.
(Francisco vs. NLRC, G.R. No. 170087, Aug. 31,
2006)
Q: What is the two-tiered test?
A:
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; and
2. The underlying economic realities of
the activityor relationship.
Note: Thistwo-tieredtestwouldprovideuswitha
framework of analysis, which would take into
consideration the totality of circumstances
surroundingthe true nature of the relationship
between the parties. This is especially
appropriateinthis casewherethere is nowritten
agreement or terms of reference to base the
relationshipon and due to the complexityof the
relationshipbasedon the various positionsand
responsibilities given to the worker over the
periodof the latter's employment.(Francisco vs.
NLRC, GR. No. 170087, Aug. 31, 2006)
Q: What is the proper standard for
economic dependence?
A: The proper standard is whether the worker
is dependent on the alleged employer for his
continuedemployment inthat line of business
Q: What determines the existence of an
employment relationship?
A: It is determined by law and not by contract.
Whether or not an Er-Ee relationship exists
between the parties is a question of fact. In
this regard, the findings of the NLRC are
accorded not only respect but finality if
supported by evidence.
Note: Taxi or jeepney drivers under the
"boundary" systemare Ee's of tl;1.etaxi orjeepney
owners/operators; so also the" passenger bus
drivers and conductors. (Jardin vs. NLRC and
Goodman Taxi, G.R. No. 119268, Feb. 23, 2000)
Q: The employment contract stipulates that
there is no Er-Ee relationship between the
parties. Is that valid?
A: No. The existence of an Er-Ee relation is a
question of law and being such, it cannot be
made the subject of agreement.' (Tabas v.
California Manufacturing Co., G.R. No. L-
80680, Jan. 26, 1989)
Q: Banco de Manila and the Ang Husay
J anitorial and Pest Control Agency entered
into an Independent Contractor Agreement
with the usual stipulations: specifically, the
absence of Er-Ee relationship, and the
relief from liability clauses. Can the bank,
as a client, and the agency, as an
independent contractor, stipulate that no
Er-Ee relationship exists between the bank
and the Ees of the Agency who may be
assigned to work in the Bank? Reason.
A: Yes, they can stipulate provided the
relationship is job contracting. However the
stipulation cannot prevail over the facts and
the laws. The existence of Er-Ee relationship is
determined by facts and law and not by
stipulation of the parties. (Insular Life
Assurance Co.. Ltd. v. NLRC, G.R. No.
119930, March 12,1998)
Q: Who are government employees (Ees)?
A: They are Ees of the:
1. National Government
2. Any of its political subdivisions
3. Including those employed in GOCCs
with original charters.
Q: What law governs government Ees?
A: The Civil Service Law, rules and
regulations.
Q: Who are managerial Ees?
A: Those whose primary duty consists of the
management of the establishment in which
they are employed or a department or
subdivision thereof, and other officers or
members of the managerial staff.
They must meet all of the ff. conditions,
namely:
1.
2.
Primary duty: management of the
establishment in which they are
employed or of a department or sub-
division thereof;
Customarily or regularly direct the
work of 2or more Ees
Has the authority to hire or fire other
Ees of lower rank; or their
suggestions and recommendations
as to the hiring and firing and as to
the promotion or any change of status
of other Ees are given particular
weight.
Execute under general supervision
work along specialized or technical
lines requmnq special training,
experience, or knowledge
Execute under general supervision
special assignment and tasks; and
Do not devote more than 20% of their
hours worked to activities which are
not directly and closely related to
performance of the work described.
(Art. 82[2])
3.
4.
5.
6.
Q: Why are managerial Ees not covered?
A: They are employed by reason of their
special training, expertise or knowledge and
for positions requiring the exercise of
discretion and independent judgment. Value of
work cannot be measured in terms of hours.
Q: Who are field personnel?
A: They are:
1. non-agricultural employees
2. who regularly perform their duties
3. away from the principal place of
business or branch office of the
employer; and
4. whose actual hours of work in the
field cannot be determined with
reasonable certainty.
PacuCtaa de < Der ecno Ci vi C
LABOR STANDARDS: CONDITIONS OF EMPLOYMENT: HOURS OF WORK
Q: Who are workers paid by results? , ART. 83. NORMAL HOURS OF WORK
A: They are:
1. paid based on the work completed;
and
2. not on the time spent in working
3. including those who are paid on
piece-work, 'takay", "pakiaw", or task
basis if their output rates are in
accordance with the standards
prescribed.
Q: Who are domestic helpers and persons
in the personal service of another?
A: Those who:
1. perform services in the employers
(Er) home which are usually
necessary or desirable for the
maintenance or enjoyment thereof; or
. 2. minister to the personal comfort,
convenience or safety of the Er as
well as the members of his Ers
household.
Q: A house personnel was hired by a
ranking company official to maintain a staff
house provided for the official. The
personnel is being paid by the company
itself. Is the house personnel a domestic
servant of the company official?
A: No, the personnel is not a domestic helper
but a regular employee of the company.
Q: What are the 3 groups of employees
(Ees) under the LC?
A:
1. Managerial Ee - One who is vested
with the powers or prerogatives to lay
down and execute management
policies and/or to hire, transfer,
suspend, lay-off, recall, discharge,
assign or discipline Ees.
2. Supervisory Ee - those who in the
interest of the Er, effectively
recommend such managerial actions
if the exercise of such authority is not
merely routinary or clerical in nature
but requires the use of independent
judgment.
3. Rank-and-File Ee all Ees not falling
within any of the above definitions.
(Art. 212{mJ)
30
Q: What is the normal hours of work of an
Ee?
A: It should not exceed 8 hours in a general
working day.
Note: Only the maximum is prescribed, not the
minimum. Part-time work is therefore not
prohibited.
Q: Can the normal. hours of work be
shortened or cornpressed?
A: Yes.
Q: What is a compressed workweek?
A: The normal workweek is reduced to less
than 6 days but the total number of work-hours
of 48 hours per week shall remain. The normal
workday is increased to more than 8 hours but
not to exceed 12 hours, without corresponding
overtime premium. The concept can be
adjusted accordingly depending on the normal
workweek of the company. (Department
Advisory Order No.2, Series of 2009)
Q: When is the implementation of a
compressed work week valid?
A: The validity of the reduction of working
hours can be upheld when the arrangement is
temporary, it is a more humane solution
instead of a retrenchment of personnel, there
is notice and consultations with the workers
and supervisors, a consensus is reached on
how to deal with deteriorating economic
conditions and it is sufficiently proven that the
company was suffering from losses. Under the
Bureau of Working Conditions' bulletin, a
reduction of the number of regular working
days is valid where, the arrangement is
resorted to by the employer to prevent serious
losses due to causes beyond his control, such
as when there is a substantial slump in the
demand for his goods or services or when
there is lack of raw materials. There is one
main consideration in determining the validity
of reduction of working hours - that the
company was suffering from losses. A year of
financial losses would not justify a reduced
workweek. (Linton Commercial v. Hel/era,
G.R.No. 163147, October 10,2007)
Q: Under what conditions may a
"compressed work week" schedule be
legally authorized as an exception to the
"S-hour a day" requirement under the LC?
A:
1. The Ee voluntarily agrees to it
2. There is no diminution in their weekly
or monthly take home payor fringe
benefits
3. The benefits are more than or at least
commensurate or equal to what is
due the Ees without the compressed
work week
4. OT pay will be due and demandable
when they are required to work on
those days which should have
ceased to be working days because
of the compressed work week
schedule.
5. No strenuous physical exertion or that
they are given adequate rest periods.
6. It must be for a temporary duration as
determined by the DOLE. (2005 Bar
Question)
Q: What are the requisites lor adoption of
compressed workweek?
A:
1. The Er shall notify the DOLR through
the Regional Office which has
jurisdiction over the workplace, of the
adoption of compressed workweek.
2. The notice shall be in Report Form
attached to the advisory.
3. The Regional Office shall conduct an
ocular visit to validate whether the
adoption of the flexible work
arrangements is in accordance with
this issuance. (Department Advisory
Order No.2, Series of 2009)
Q: Is an employer (Er) obliged to pay an
employee (Ee), who rendered less than 8
hours of work, the wages due for S hours-
work?
A:
GR: No, following the principle of "a fair
day's wage for a fair day's labor"
XPN: If by voluntary practice or policy, the
Er, for a considerable period of time, has
been paying his Ees wages due for 8 hours
although their work shift is less than 8
hours.
Q: What are regular working days?
A: It should not be more than 5 days in a
workweek. It may begin at any hour and on
any day, including Saturday or Sunday,
designated by the employer.
Q: Who are health personnel?
A: Includes resident physicians, nurses,
nutritionists, dieticians, pharmacists, social
workers, laboratory technicians, paramedical
technicians, psychologists, midwives,
attendants and all other hospital or clinic
personnel.
Q: What are the hours of work of health
personnel?
A:
GR: 8 hours/5 days (40-hour work week),
exclusive of time for meals.
XPN: Where the exigencies of the service
require that such personnel work for 6 days
or 48 hours, they shall be entitled to an
additional compensation of at least 30% of
their regular wage for work on the s" day.
Note: 40-hour work week does not apply if there
is a training agreement between the resident
physician and the hospital and the training
program is duly accredited or approved by
appropriate government agency.
Q: Who are covered by the 40-hour work
week?
A:
1. Health personnel in cities and
municipalities with a population of at
least 1 million; or
2. Hospitals and clinics with a bed
capacity of at least 100
Note: Art. 83(2) do not require hospital to pay the
Ees a full weekly salary with paid 2 days off.
(San Juan de Dios Ees Assoc.-AFW et al. VS.
NLRC, G.R. No. 126383, Nov. 28, 1997)
Q: Distinguish work day from calendar
day?
A:
WORK DAY . CALENDAR DAY
It refers to the 24
hr. period
commencing at 12
midnight and
ending at 11:59 pm
It refers to 24 hr. period
commencing from the time
an Ee regularly starts to
work regardless of
whether the work is
continuous or broken.
Pacu{ taa de Ver ecno Ci vi (
LABOR STANDARDS: CONDITIONS OF EMPLOYMENT: HOURS WORKED
, ART. 84. HOURS WORKED
Q: What are considered hours worked?
A:
1. All time during which an Ee is
required to be:
a. On duty, or
b. At the Ers premises, or
c. At a prescribed workplace
2. All time during which an Ee is
suffered or permitted to work. (Sec. 3,
Rule I, Book III, IRR)
Q: What are the principles in determining
hours worked?
A:
1. All hours which the Ee is required to
give to his Er regardless of whether
or not such hours are spent in
productive labor or involve physical or
mental exertion.
2. Rest period is excluded from hours
worked, even if Ee does not leave his
workplace, it being enough that:
a. He stops working
b. May rest completely and
c. May leave his workplace, to
go elsewhere, whether
within or outside the
premises of the workplace
3. All time spent for work is considered
hours worked if:
a. The work performed was
necessary
b. If it benefited the Er
c. Or the Ee could not abandon
his work at the end of his
normal working hours
because he had no
replacement
d. Provided, the work was with
the knowledge of his Er or
immediate supervisor
4. The time during which an Ee is
inactive by reasons of interruptions in
his work beyond his control shall be
considered working time:
a. If the imminence of the
resumption of the work
requires the Ees presence
at the place of work or
b. If the interval is too brief to
be utilized effectively and
gainfully in the Ees own
interest. (Sec. 4, Rule I,
Book III, IRR)
32
Q: When is an Ee considered working while
on call?
A: When Ee is required to remain on call in the
Ers premises or so close thereto that he
cannot use the time effectively and gainfully for
his own purpose.
Q: When is waiting time considered
working time?
A:
1. If waiting is an integral part of his
work or
2. The Ee is required or engaged by the
Er to wait (engaged to wait)
Note: The controlling factor is whether waiting
time spent in idleness is so spent predominantly
for the Er's benefit or for the Ee.
Q: When is waiting time not considered
working time?
A: When the Ee is waiting to be engaged: idle
time is not working time; it is not compensable.
Q: Lito and Bong were employed as truck
drivers of Line Movers, Inc. Usually, Lito is
required by the personnel manager to just
stay at the head office after office hours
because he could be called to drive the
trucks. While at the head office, Lito merely
waits in the manager's reception room. On
the other hand, Bong is allowed to go home
after office hours but could be contacted
whenever his service as driver becomes
necessary. Would the hours that Lito and
Bong are on call be considered
compensable working hours?
A: The hours of Lito and Bong while on call
can be considered compensable hours. The
applicable rule is: "An Ee who is required to
remain on call in the Er's premises or so close
thereto that he cannot use the time
effectively and gainfully for his own purpose
shall be considered as working while on can.
An Ee who is not required to leave word at his
home or with company officials where be may
be reached is not working while on cal!." Here,
Bong is required to stay at the office after
office hours so he could be called to drive the
trucks of the Company. As for Bong, he is
required to keep his cellular phone so that he
could be contacted whenever his services as
driver as needed. Thus, the waiting time of Lito
and Bong should be considered are
compensable hours. (1997 Bar Question)
Note: It could be argued that in the case of Bong
who is not required to stay in the office but is
allowed to go home, if he is not actually asked by
cellular phone to report to the office to drive a car,
he can use his time effectively and gainfully to his
own purpose, thus, the time that he is at home
may mean that there are not compensable hours.
Q: When is travel time considered working
time?
A:
1. Travel from home to work
GR: Normal travel frofh horne to work
is not working time.
XPNS:
;-Emergency call outside his
regular working hours where he
is required to travel to his regular
place of business or some other
work site.
b. Done through a conveyance
provided by the employer (Er).
c. Done under the supervision and
control of the Er.
d. Done under vexing and
dangerous circumstance.
2. Travel that is all in a day's work -
time spent in travel as part of the
employees (Ees) principal activity
e.g. travel from job site to job site
during the work day, must be counted
as working hours.
3. Travel away from home
GR:
aTravel that requires. an overnight
stay on the part of the Ee when it
cuts across the Ees workday is
clearly working time.
b. The time is not only hours
worked on regular workdays but
also during corresponding
working hours on non-working
days. Outside of these regular
working hours, travel away from
home is not considered working
time.
XPN: During meal period or when Ee
is permitted to sleep in adequate
facilities fumished by the Er.
Q: What are the conditions in order for
lectures, meetings and training programs
to be not considered as working time?
A: All of the ft. conditions must be present:
1. Attendance is outside of the
employers regular working hours
2. Attendance is in fact voluntary and
3. The employee does not perform any
productive work during such
attendance.
Q: Are regular full-time teachers entitled to
salary and COLA during semestral breaks?
A: Yes. It is a form of interruption beyond their
control. (University of Pangasinan Faculty
Union vs. University of Pangasinan, G.R No.
L-63122, Feb. 20, 1984)
Q: What are the guidelines on power
interruptions?
A:
1. Brownouts of short duration but not
exceeding 20 minutes shall be
treated as worked or compensable
hours whether used productively by
the employees (Ees) or not.
2. Brownouts running for more than 20
minutes may not be treated as hours
worked provided any of the following
conditions are present:
a. The Ees can leave their
workplace or go elsewhere within
or without the work premises; or
b. The Ees can use the time
effectively for their own interest.
3. In each case, the Er may extend the
working hours of his Ees outside the
regular schedules to compensate for
the loss of productive man-hours
without being liable for OT pay.
4. lndustrial enterprises with one or two
work shifts may adopt any of the work
shift prescribed for enterprises with 3
work shifts to prevent serious loss or
damage to materials, machineries, or
equipment that may result case of
power interruptions. (Policy
Instruction No. 36)
UNIVERSITY OF SANTO TOMAS J O...IJ J .. 33
PacuCtad de < Der echo Ci vi C
LABOR STANDARDS: CONDITIONS OF EMPLOYMENT: MEAL PERIODS
ART. 85. MEAL P-ERIODS '
Q: What is the duration of the meal period?
A: Every Er shall give his Ees not less than 60
minutes or 1hour time-off for regular meals.
Q: Is the meal period compensable?
A: Being time-off, it is not compensable.
Employee must be completely relieved from
duty.
Q: When is the meal period considered
compensable?
A: It is compensable where the lunch period or
mealtime:
1. Is predominantly spent for the
employers benefit or
2. Where it is less than 20 minutes.
Note: Where during meal period, the taborers are
required to stand by for emergency work, or
where the meal hour is not one of complete rest,
such is considered OT. (Pan Am vs. Pan Am Ees
Association, G.R. No. L-16275, Feb. 23, 1961)
Rest periods or coffee breaks running from 5 to
20 minutes shall be considered as compensable
working time. (Sec. 7, Rule f, Book III, IRR)
Q: Are meal periods provided during OT
work compensable?
A: Yes, since the 1 hour meal period (non-
compensable) is not given during OT work
because the latter is usually for a short period
and to deduct from the same would reduce to
nothing the Ees OT work. Thus, the 1 hour
break for meals during OT should be treated
as compensable.
Q: What are the instances where meal
periods shortened to not less than 20
minutes is compensable or not
compensable?
A:
1. Compensable - At the instance of
Employer, when:
a. Work is non-manual in nature or
does not involve strenuous
physical exertion;
b. Establishment regularly operates
less than 16 hours a day;
c. Work is necessary to prevent
serious loss of perishable goods.
d. Actual or impending emergency
or there is urgent work to be
performed on machineries and
equipment to avoid serious loss
34
which the Er would otherwise
suffer. (Sec. 7, Rule I, Book III,
IRR)
2. Not Compensable - Ee requested for
the shorter meal time so that he can
leave work earlier than the previously
established schedule. Requisites:
a. Ees voluntarily agree in writing
and are willing to waive OT pay
for the shortened meal period;
b. No diminution in the salary and
other fringe benefits of the Ees
which are existing before the
effectivity of the shortened meal
period;
c. Work of the Ees does not involve
strenuous physical exertion and
they are provided with adequate
coffee breaks in the morning and
afternoon;
d. Value of the benefits derived by
the Ees from the proposed work
arrangements is equal to or
commensurate with the
compensation due them for the
shortened meal period as well as
the OT pay for 30 minutes as
determined by the Ees
concerned;
e. OT pay will become due and
demandable after the new time
schedule
f. Arrangement is of temporary
duration.
. ~-~ART. J l!)", flI_IGHTSH~Ft DIFFERENTIAL '.
Q: What is night shift differential (NSD)?
A: It is additional compensation of not less
than 10% of an Ees regular wage for every
hour worked between 10:00 pm to 6:00 am,
whether or not such period is part of the
worker's regular shift.
Q: Who are entitled to NSD?
~l ,
A: GR: NSD applies to all employeesIfies).
XPN:
1. Ees of the Gov't and
political subdivisions,
GOGG's.
any of its
including
2. Retail and service establishments
regularly employing not more than 5
workers.
3. Includes task and contract basis
personal service of another.
5. Field personnel and Ees whose time
and performance is unsupervised by
the employer
6. Managerial Ees
Q: Mayan employee waive the right to
NSD?
A:
GR: No, such waiver is against public
policy. (Mercury Drug Co., Inc. vs. Dayao,
et al., G.R. No. L-30452, Sep. 30, 1982)
XPN: Higher/better benefits
Q: Distinguish NSD from overtime pay.
A:
NSD' - OVERTIME PAY
Payment for work
done during the
night
(10pm-6am)
Payment for the
excess of the regular
8-hr work
25% or 30% of basic
wage
10% of basic wage
Note: When the Ee's shift falls at nighttime, the
receipt for OT pay shall not preclude the right to
receive NSD.
Q: As a tireman in a gasoline station, open
24 hours a day with only 5 employees,
Goma worked from 10:00 P.M. until 7:00
A.M. of the following day. He claims he is
entitled to NSD. Is he correct? Explain
briefly.
A: Yes. Under Art 86 of the Labor Code, NSD
shall be paid to every Ee for work performed
between 10:00 o'clock in the evening to six
o'clock in the morning. Therefore, Goma is
entitled to nightshift differential for work
performed from 10:00 pm until 6:00 am of the
day following, but not from 6:00 am to 7:00 am
of the same day. (2002 Bar Question)
..." ...,. .'~ i : ~.~ .
Academics Committee
Chai r per son: Abraham D. Genuino II
Vi ce-Chai r for Academi cs: J eannie I\. Laurentino
Vi a-Cbar for Ar bni n &F i nance: Aissa CelineH.Luna
Vi ce-Chai r j ar L ayout &Desi gn: LoiseRae G.Naval
Labor LawCommittee
Subj ect H ead' Lester J ay AlanE.Flores II
.Assi stant Subj ect H ead' Domingo B.Diviva V
Members:
Rene FrancisP.Batalla
Maria Kristina L Dacayo-Garcia
ChristianNinoi \. Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelleCLee
J emuel PaoloM.Lobo
Andrew W.Montesa
Maria Maica i\ngehka Roman
"~ ....~ ... 7
UNIVERSITY OF SANTO TOM.A~ ~;!35
PacuCtati ti e (/)er ecl i o CunC '9
LABOR STANDARDS: CONDITIONS OF EMPLOYMENT: OVERTIME
. ART. 87. OVERTIME WORK
Q: What is the rationale behind OT pay?
Q: What is overtime work (OT)?
A: Work performed beyond 8 hours within the
worker's 24 hour workday.
Note: Express instruction from the employer (Er)
to the employee (Ee) to render OT work is not
required for the Ee to be entitled to OT pay; it is
sufficient that the Ee is permitted or suffered to
work. However, written authority after office hours
during rest days and holidays are required for
entitlement to compensation.
Q: What is a work day?
A: The 24-hour period which commences from
the time the employee regularly starts to work
e.g. If the worker starts to work 8 am today,
the workday is from 8 am today up to 8am
tomorrow.
Note: Minimum normal working hours fixed by
law need not be continuous to constitute the legal
working day.
Q: Distinguish OT from premium pay.
A:
~. OT PAY' . PREMIUM PAY .
Additional compensation for
work performed within 8 hours
on days when normally he
should not be working (on
non-working days, such as
rest days and special days.)
Additional
compensation
for work
performed
beyond 8 hours
on ordinary
days (within the
worker's 24-
hour workday)
But additional compensation
for work rendered in excess of
8 hours during these days is
also considered OT pay.
Q: What are the OT pay rates?
Rate of the first 8 hours worked on
plus at least30% of the regular wage (RW):
if done on a special holiday OR rest day:
30% of 130%of RW
If done on a special holiday AND rest day:
30% of 150% of RW
if done on a regular holiday:
30% of 200% of RW
36
A: Employee is made to work longer than what
is commensurate with his agreed
compensation for the statutory fixed or
voluntarily agreed hours of labor he is
supposed to do. (PNB VS. PEMA and CIR,
G.R. No. L-30279, July 30, 1982)
Discourages the employer (Er) from requiring
such work thus protecting the health and well-
being of the worker, and also tend to remedy
unemployment by encouraging Ers to employ
others workers c. to do what cannot be
accomplished during the normal hours of work.
Q: Can the right to OT pay be waived?
A: .
GR: The right to OT pay cannot be waived
as it is governed by law and not merely by
the agreement of the parties.
XPN:
1. If the waiver is done in exchange for
certain valuable .benefits and
privileges, which may' even exceed
the OT Pay, waiver may be permitted.
Compressed work week 2.
Q: What is the basis of computing the OT
pay and additional remuneration?
A: Regular wage-includes the cash wage only,
without deduction on account of facilities
provided by the employer. (Art. 90)
Q: In lieu of OT pay, the employee was
given permission to go on leave on some
other day, is that valid?
A: No. Permission given to the employee (Ee)
to go on leave on some other day of the week
shall NOT exempt the employer from paying
the additional compensation required because
it would prejudice the Ee, for he will be
deprived of the additional pay for the OT work
he has rendered and which is utilized to offset
the undertime he may have incurred.
Undertime could be charged against the Ees
accrued leave.
Q: A case against an employer (Er)
company was filed charging it with having
violated the prohibition against offsetting
UT for aT work on another day. The
complainants were able to show that,
pursuant to the CBA, employees (Ees) of
the union had been required to work "O'I"
on Saturday but were paid only at regular
Q: Socorro is a clerk-typist in the Hospicio
de San J ose, a charitable institution
dependent for its existence on
contributions and donations from well
wishers. She renders work 11 hours a day
but has not been given O'T pay since her
place of work is a charitable institution. Is
Socorro entitled to O'T pay? Explain briefly.
A: Yes. Socorro is entitled to OT
compensation. She does not fal! under any of
the exceptions to the covera9;.~of ~rt. 82,
under the provisions of hours of work. The
Labor Code is equally applicable to non-profit
institutions. A covered Ee who works beyond 8
hours is entitled to OT compensation. (2002
Bar Question)
Q: Flores applied for the position of driver
in the motor-pool of Gold Company, a
multinational corporation. Danilo was
informed that he would frequently be
working aT as he would have to drive for
the company's executives even beyond the
ordinary 8-hour work day. He was provided
with a contract of employment wherein he
would be paid a monthly rate- equivalent to
35 times his daily wage, regular sick and
vacation leaves, 5 day-leave with pay every
month and time off with pay when the
company's executives using the cars do
not need Danilo's service for more than
eight hours a day, in lieu of OT. Are the
above provisions of the contract of
employment in conformity with, or violative
of, the law?
A: Except for the provision that Oanilo shall
have time off with pay when the company's
executives using the cars do not need Oanilo's
service for more than 8 hours a day, in lieu of
OT, the provisions of the contract of
employment of Oanilo are not violative of any
labor law because they instead improve upon
the present provisions of pertinent labor laws.
ART: 88. UNDERTIME N,OTOFFSET BY or
Q: Can undertime (UT) offset OT?
A: No, UT work on any particular day shall not
be offset by OT work on any other day.
rates of pay on the thesis that they were
not required to complete, and they did not
in fact complete, the B-hour work period
daily from Monday through Friday. Given
the circumstances, the Er contended that
the Ees were not entitled to OT
compensation, i.e., with premium rates of
pay. Decide the controversy.
A: The Er is correct. While Art. 88 of the LC
clearly provides that undertime work on any
other particular day shall not be offset by
overtime work on any other day, this rule is
inapplicable in this case pertaining to Saturday
work which in reality does not constitute OT
work as Saturday is still a working day under
the law and there is no CBA stipulation against
it. (2003 Bar Question)
ART.'89. EMERG-ENY OVERTIME WORK
Q: Mayan employee be compelled to
render O'I work?
A:
GR: No. OT work is voluntary.
XPN: Compulsory OT work in any of the
following situations:
1. Urgent work to be performed on
machines and installations in order to
avoid serious loss or damage to the
Er or some other cause of similar
nature.
2. Work is necessary to prevent loss or
damage to perishable goods.
3. In case of imminent danger to the
public safety due to an actual or
impending emergency in the locality
caused by serious accidents, fire,
flood, typhoon, earthquake, epidemic
or other disaster or calamity.
4. Country is at war,
5. Completion or continuation of the
work started before the 8th hour is
necessary to prevent serious
obstruction or prejudice to the
business operations of the Er
6. Any other national or local emergency
has been declared
7. Necessary to prevent loss of life or
property.
Note: There should be payment of additional
compensation. Ees refusal to obey the order of
the Er constitutes insubordination for which he
maybe subjected todisciplinary action.
Pacu(taa ae <Derecfio Civif
LABOR STANDARDS: CONDITIONS OF EMPLOYMENT: OVERTIME
Q: The employment contract requires work
for more than 8 hours a day with a fixed
wage inclusive of OT pay. Is that valid?
A: It depends.
1. When the contract of employment
requires work for more than 8 hours
at specific wages per day, without
providing for a fixed hourly rate or
that the daily wages include OT pay,
said wages cannot be considered as
including OT compensation. (Manila
Terminal Go. vs. GIR, et al., 91 Phil.,
625)
2. However, the employment contract
may provide for a "built-in" OT pay.
Because of this, non-payment of OT
pay by the employer is valid. (Eng'g
Equipment vs. Minister of Labor, G.R.
No. L-64967, Sep. 23, 1985)
38
Academics Committee
Chai r per son: Abraham D.Genuino II
Vi ce-Chai r for Admi n &F i nance: Aissa Celine H.Luna
Vi ce-Chai r for L qout &Desi gn: LoiseRae G.Naval
Labor LawCommittee
Subj ect H ead' Lester J ayAlanE.FloresII
Members:
Rene Francis P.Batalla
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelleC.Lee
]emuel PaoloM.Lobo
Andrew W.Montesa
Maria Maica AngeJ ika Roman
UST GOL1)EN NOTES 2010
A: Yes. Nothing shall prevent the Er and his
Ee or their representatives from entering into
any agreement with terms m9re favorable to
UNIVERSiTY OF SANTO TOMAS ~i. 39
PacuCtaa ae CDer ecno CiviC . ,(;1'
CHAPTER II
WEEKLY REST PERIODS
- ART~-9C RIGI:rt-foWEEKLY REST D~-
Q: What is the right to weekly rest day
(WRD)?
A: Every employer shall give his employees a
rest period of not less than 24 consecutive
hours after every 6 consecutive normal work
days. (Sec. 3, Rule III, Book III, IRR)
Q: What is the scope of WRD?
A: It shall apply to all employers whether
operating for profit or not, including public
utilities operated by private persons. (Sec. 1,
Rule III, Book III, IRR)
Q: Who determines the WRD?
A:
GR: Er shall determine and schedule the
WRD of his Ee.
XPNs:
1. CSA
2. Rules and regulations as the SLE
provides
3. Preference of employee (Ee) based
on religious grounds - Ee shall make
known his preference in writing at
least 7 DAYS before the desired
effectivity of the initial rest day so
preferred. (Sec. 4(1), Rule III, Book
III, IRR)
XPN to XPN no. 3: employer (Er)
may schedule the WRD of his choice
for at least 2 days in a month if
preference will inevitably result in:
a. serious prejudice to the
operations of the undertaking
and
b. the Er cannot normally be
expected to resort to other
remedial measures. (Sec. 4(2),
Q: When should employees (Ees) be
informed of their schedule of WRD?
A: Er shall make known rest period by means
of:
1. Written notice
2. Posted conspicuously in the
workplace
3. At least 1 week before it becomes
effective. (Sec. 5, Rule III, Book III.
IRR)
ART. 92.EMPLOYER MAY REQUIRE
WORK ON A REST DAY
- - --
Q: Can an Ee be compelled to work on his'
rest day?
A:
GR: No.
XPN:
1. Urgent work to be performed on the
machinery, equipment or installation,
to avoid serious loss which the Er
would otherwise suffer;
2. Nature of work requires continuous
operations for 7 days in a week or
more and stoppage of the work may
result in irreparable injury or loss to
the Er;
3. Abnormal pressure of work due to
special circumstances, where the Er
cannot be ordinarily expected to
resort to other measures;
4. Actual or impending emergencies
(serious accident, fire, flood, typhoon,
earthquake, etc.)
5. Prevent loss or damage to perishable
goods;
6. Analogous or similar circumstances
as determined by the SLE;
7. Work is necessary to avail of
favorable weather or environmental
conditions where performance or
quality of work is dependent thereon.
Q. What is the rule when an Ee volunteers
to work on his rest day under other
Circumstances?
A: He shall express it in writing subject to
additional compensation. (Sec. 6[2J, Rule III,
Book III, IRR)
ART. 93.COMPENSATION FOR REST
DAY, SUNDAY or HOLIDAY WORK
(SPECIA[ HOLIDAY)
Q: What is premium pay?
A: It is the additional compensation for work
rendered by the employee on days when
normally he should not be working such as
special holidays and weekly rest days.
Q: Can the Er and Ee agree on the rate of
premium pay other than that provided by
law?
LABOR STANDARDS: CONDITIONS OF EMPLOYMENT: REST DAY
the Ees Provided: It shall not be used to
diminish any benefit granted to the Ees under
existing laws, agreements and voluntary Er
practices. (Sec. 9, Rule III, Book III, IRR)
Q: What are the rates of compensation for
rest day, Sunday or holiday work?
A:
RATES OF
INSTANCES
ADDITIONAL
COMPENSATION
Work on a scheduled
+30% Premium Pay
rest day
(PP) of 100% regular'
wage (RW). (Sec. 7,
Work has no regular
workdays and rest
+30% PP of 100% RW .
days
. (Sec. 7, Rule III, Book
(If performed on
III,IRR
Sundays and
Holidays)
Work on a Sunday
+30% PP of 100% RW.
(If Ee's scheduled
(Sec. 7, Rule III, Book
rest day)
III,IRR)
1st 8hrs; +30% PP of
100% RW
Work performed on
Excess of 8 hrs: +30%
any Special Holiday
of hourly rate on said
date. (M.C. No. 10,
Series of 2004)
1st 8 hrs: +50% PP of
Work performed on a
100% regular wage
Special Holiday and
Excess of 8 hrs: +30%
same day is the
of hourly rate on said
scheduled rest day
date. (M.C. No. 10,
Series of 2004)
Ee is only entitled to
his basic rate. No PP is
required.
Work performed on a
Special Working Reason: Work
Holiday
performed is considered
work on ordinary
working days. (Sec. 7,
Note: Holiday work provided under Art.93
pertains to special holidays or special days.
Q: J ose applied with Mercure Drug
Company for the position of Sales Clerk.
Mercure Drug Company maintains a chain
of drug stores that are open everyday till
late at night. J ose was informed that he had
to work on Sundays and holidays at night
as part of the regular course of
employment. He was presented with a
contract of employment setting forth his
compensation on an annual basis with an
express waiver of extra compensation for
40
work on Sundays and holidays, which J ose
signed. Is such a waiver binding on J ose?
Explain.
A: As long as the annual compensation is an
amount that is not less than what J ose should
receive for all the days that he works, plus the
extra compensation that he should receive for
work on his weekly rest WRD and for night
differential pay for late night work, considering
the laws and wage orders providing for
minimum wages, and the pertinent provisions
of the LC, then the waiver that J ose signed is
binding on him, for he is not really waiving any
right under Labor Law. It is not contrary to law,
morals, good customs, public order or public
policy for an Er and Ee to enter into a contract
where the Ees compensation that is agreed
upon already includes all the amounts he is to
receive for OT work and for work on weekly
rest days and holidays and for night differential
pay for late night work. (1996 Bar Question)
Academics Committee
Vi ce-Chai r for Academi cs: J eannie "-\.Laurentino
Vi ce-Chai r for Admi n &F i nance: Aissa Cehne H.Luna
Vi ce-Chai r for L ayou: &Desi gn: LoiseRaeG.Naval
Labor LawCommittee
Members:
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencic
]eanelle C.Lee
]emuel PaoloM.Lobe
Andrew W.Montesa
Maria Maica Angelika Romaz
. ".~ ~-CHAPTERIJ I' --"~-,,_
~HOUOAYS, S ENTIVE LEAVES AND
';". S .ARGES
Q: What is holiday pay (HP)?
A: It is a premium given to employees (Ees)
pursuant to law even if he has' not been
suffered to work on a regular holiday. It is
limited to the 11 regular, also called legal,
holidays listed by law. The employee (Ee)
should not have been absent without pay on
the working day preceeding the regular
holiday.
Q: What are the classes of special days
(SO)?
A:
1. National Special Public Holiday
GR: Non working days
XPN: Otherwise declared by the
President
2. Local Special Public Holiday -
Regular working day. (LOt 814 as
amended by L011087)
NATIONAL SPECIAL
I
DATE
DAYS
All Saints Day November 1
Last Day of the Year December 31
Monday Nearest
Ninoy Aquino Day
August 21(RA
9462, July 25,
2007)
Other days declared by
law
December 24
1. Special Non-working
days
2. Special Public
Holidays
3. Special National
Holiday
4. Special Holiday ( for
all schools)
February 22
a. Edsa Revolution
Anniversary
(Monday nearest
25)
~'11f!''''1;,j:{1t'!'
Those declared by:
e.g. Manila day (in
\
1. Law or
2. Ordinance
Manila only)
Q: What are regular holidays (RH)?
A: They are compensable whether worked or
nworked subject to certain conditions. They
are also called legal holidays. The following
a-e considered regular holidays. (R.A 9492)
~BEGUt:~HOt:IDAYS. DATE
0
New Year's Day J anuary 1
Maundy Thursday April 1
Good Friday April 2
Eid'IFitr Movable Date
8raw ng Kagitingan
Monday nearest April
9
,babor Day
Monday nearest May
1
independence Day
Monday nearest J une
12
National Heroes Day
Last Monday of
August (Aug. 30)
~onifacio Day
Monday nearest Nov.
30 (Nov. 29)
Christmas Day December 25
Bizal Day
Monday nearest Dec.
30 (Dec.27)
Note: RA 9492 provides that Holidays, except
those which are religious in nature, are moved to
the nearest Monday unless otherwise modified by
law, order or proclamation. (Proc. No. 1841)
If the holiday falls on a Wednesday, the holiday
will be observed on the Monday of the week. If
the holiday falls on a Sunday, it will be observed
on the Monday that follows. (R.A 9492)
Q: What are Muslim Holidays (MH)?
A: The MHs, except Eid'/ Fitr, are observed in
specified Muslim areas. All private
corporations, offices, agencies and entities or
establishments operating within the designated
Muslim provinces and cities are required to
observe MH.
Q: When shall Eid" Fitr andlor Eid'/ Adha
be declared a national holiday?
A: The proclamation declaring a national
holiday for the observance of Eid'l Fitr and/or
Eid'l Adha shall be issued:
1. After the approximate date of the
Islamic holiday has been determined
in accordance with the:
a. Islamic Calendar (Hijra) or
b. Lunar Calendar or
c. Upon astronomical calculations
d. Whichever is possible or
convenient.
2. The Office of Muslim Affairs shall
inform the Office of the President on
which day the holiday shall fall.
(Sec.2, Proc. No. 1841)
UNIVERS!TV OF SANTO TOMAS .. A ~ 41
Pacu{ tad de (] )er echo Ci vi C
LABOR STANDARDS: CONDITIONS OF EMPLOYMENT: HOLIDAY PAY
Q: Can a Christian employee (Ee) working
within the Muslim area be compelled to
work during MH?
A: No. Christians working within the Muslim
areas may not report for work during MH. Not
only Muslim but also Christian Ee in the
designated provinces and cities are entitled to
HP on the MH. (SMC v. CA, G.R. 146775, Jan.
30,2002)
Q: Can a Muslim Ee working outside the
Muslim area be compelled to work during
the observance of the MH?
A:
GR: No. Muslim Ees shall be excused from
work during MH without diminution of
salary or wages.
XPN: Those who are permitted or suffered
to work on MH are entitled to at least 100%
basic pay + 100% as premium of their
basic pay. (SMC v. CA, G.R. No. 146775,
Jan. 30, 2002)
Note: RH falling within temporary or periodic
shutdown and temporary cessation of work are
compensable. However, if the temporary or
periodic shutdown and cessation of work is due
to business reverses, the employer may not pay
the RHs during such period.
Q: Distinguish RH from SO.
Regular pay
(subject to certain
conditions for daily paid
Ee'
No Pay
2x regular pay (200%)
Not exclusive
42
Q: Who are entitled to HP?
A:
GR: All employees (Ees) are entitled.
(Sec. 1, Rule IV, Book III, IRR)
XPNS:
1. Gov't Ees and any of its political
subdivisions, including GOCCs (with
original charter)
2. Retail and service establishments
regularly employing less than 10
workers
personal service of another
4. Ee 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 Ee and other member of
the managerial staff
7. Field personnel and other Ee whose
time and performance are
unsupervised by the Er
8. Ee paid Fixed amount for performing
work irrespective of the time
consumed in the performance
thereof. (Sec. 1, Rule IV, Book III,
IRR)
Q: What are retail establishments?
A: They are engaged in the sale of goods to
end users for personal or household use. (e.g.
Grocery)
Q: What are service establishments?
A: They are engaged in the sale of services to
individuals for their own or household use.
(e.g. TV repair shop)
Q: Is an exercise of profession retail or
service?
A: It is neither retail nor service.
Q: Mayan Er require an Ee to work on RH?
A: Yes. But Ee shall be compensated twice his
regular rate.
Q: What are the rates of compensation for
RH on Ees regular workday and RH on Ees
rest day?
100%
e.g. 300 Php regular
\l100%~
e.g. 300 Php (RW)
+30% of 200%
200%
e.g. 300- RW
+300
000 =Total Wage (1W)
e.g 600 -200% of
RW
X 0.3
230%
180
180+600= 780
200% +30% of hourly
rate on said date
230% +30% of
hourly rate on said
- date
Q: What is an important condition that
should be met in order to avail/receive the
single HP?
A: The Ee should not have been absent
ithout pay on the working day preceding the
RH.
Q: Distinguish between monthly paid and
daily paid Ees.
A:
Monthly Paid Ees Daily Paid Ees
One who is paid his wage
or salary for everyday of
t e month, including rest
ays, Sundays, regular or
special days, although he
does not regularly work on
these days.
at excluded from benefit
of HP.
One who is paid
his wage or salary
only on those days
he actually worked,
except in cases of
regular or special
days, although he
does not regularly
work on these
days.
Q: What is the effect if a legal holiday falls
on a Sunday?
A: A legal holiday falling on a Sunday creates
legal obligation for the Er to pay extra to the
::e who does not work on that day, aside from
. e usual HP to its monthly paid Ee.
ellington v. Trajano, G.R. 114698, July 3,
'995)
'. EMPLOYEES RULE
Private school 1. RH during semestral
teachers vacations
(Faculty - Not entitled to HP
members of 2. RH during Christmas
colleges and vacation
universities ) - Shall be paid HP
HP shall not be less than his
Ee paid by: average daily earnings for
1.results or the last 7 actual work days
2.output preceding the RH,
(Piece work Provided: HP shall not be
payment) less than the statutory
minimum wage rate.
Seasonal
May not be paid the required
Workers
HP during offseason where
they are not at work.
Workers having
no regular work Shall be entitled to HP
days
Q: Discuss the concept of absences.
A:
. ~ ABSENCES
LOA with pay on the LOA without pay on the
",- daY,lmmedlatley,,~ _., day Immediately .
'. preceding RH " r : : preceding a RH.
GR: An Ee may not be
paid the required
HP if he has not
worked on such
RH.
XPN: Where the day
immediately
preceding the
holiday is a:
1. Non-working day
(NWD) inthe
establishment or
2. The scheduled
rest day (RD) of
the Ee.
GR: All covered Ees
are entitled to HP.
Q: What is the effect in case there is a
temporary or periodic shutdown and
temporary cessation of work?
A:
TEMPORARY OR PERIOEHCSHUTDOWN and
TEMPORARY CESSATION OF WORK'
(Sec 7, Rule ,V, Book /I(IRR)
,
Instances Rule:
1. Yearly inventory or
2. When the repair or RH falling within the
cleaning of period shall be
machineries is compensated.
undertaken
Due to business reverses
RH may not be paid
(cessation as authorized
by the Sec. of Labor)
bythe Er
Q: What are the HPs of certain employees?
A:
UN I V E R SIT Y 0 F SAN ToT 0 MAS I''''''''~~ 43
PacuCtaa ae Ver ecno Ci vi C ~.
LABOR STANDARDS: CONDITIONS OF EMPLOYMENT: HOLIDAY PAY
Q: Are the school faculty who according to
their contracts are paid per lecture hour
entitled to unworked HP? .
A:
1. If during regular holiday - No. Art. 94
of LC is silent with respect to faculty
members paid by the hour who because
of their teaching contracts are obliged to
work and consent to be paid only for work
actually done (except when an emergency
or a fortuitous event or a national need
calls for the declaration of special
holidays). RH specified as such by law are
known to both school and faculty
members as "no class days" certainly the
latter do not expect payment for said
unworked days, and this was clearly in
their minds when they entered into the
teaching contracts. (Jose Rizal College v.
NLRC, G.R. No. 65482, Dec. 1, 1987)
2. If during special public holidays -
Yes. The law and the IRR governing HP
are silent as to payment on Special Public
Holidays. It is readily apparent that the
declared purpose of the HP which is the
prevention of diminution of the monthly
income of the Ees on account of work
interruptions is defeated when a regular
class day is cancelled on account of a
special public holiday and class hours are
held on another working day to make up
for time lost in the school calendar.
Otherwise stated, the faculty member,
although forced to take a rest, does not
earn what he should earn on that day. Se
it noted that when a special public holiday
is declared, the faculty member paid by
the hour is deprived of expected income,
and it does not matter that the school
calendar is extended in view of the days
or hours lost, for their income that could
be earned from other sources is lost
during the extended days. Similarly, when
classes are called off or shortened on
account of typhoons, floods, rallies, and
the like, these faculty members must
likewise be paid, whether or not
extensions are ordered. (J ose Rizal
Col/ege v. NLRC, G.R. No. 65482, Dec.1,
1987)
Q: Lita, a full time professor in San
IIdefonso University, is paid on a regular
monthly basis. She teaches for a period of
10 months in a school year, excluding the 2
month summer-break. During the semestral
break, the University did not pay her
emergency Cost of Living allowance
(ECOLA) although she received her regular
salary since the semestral break was
44
allegedly not an integral part of the school
year and no teaching service were actually
rendered by her. In short, the University
invoked the principle of "no work, no pay".
She seeks your advice on whether or not
she is entitled to receive her ECOLA during
semestral breaks. How would you respond
to the query?
A: There is no longer any law making it the
legal obligation of an employer to grant an
Emergency Cost of Living Allowance
(ECOLA). Effective 1981, the mandatory living
allowances provided for in earlier Presidential
Decrees were integrated into the basic pay of
all covered employees. Thus, whether the
ECOLA will be paid or not during the semestral
break now depends on the provisions of the
applicable wage order or contract which may
be a CSA, that many grant said ECOLA. (1997
Bar Question)
Q: What is the concept of double HP?
A: 2 RH on same day.
\
MAUNDY
\
WED
THURSDAY&,
RATE
-
ARAW NG
l
KAGITI,NGAN ' -. !-
Present unworked 200%
LOAw/pay unworked 200%
LOAw/ pay worked
300%
(at least)
Authorized
worked
300%
absence (at least)
390%
Same
Worked and day (+30% of
is Rest Day each 3
100%)
Q: Is double HP applicable at present?
A: No, because Araw ng Kagitingan is moved
to Monday nearest April 9. (R.A. 9242)
Q: What is the concept of successive RH?
A:
WED
MAUNDY I GOOD ENTITLED
THURS
i
FRIDAY TOHP
\
Worked RH RH Yes. Both
LOA
RH RH Yes. Both
wlpay
LOA wlo
RH RH No. Both
pay
LOA wlo
Yes. Only
Worked RH to HP on
pay
Friday
Q: What are the conditions so that an Ee
may be entitled to 2 successive HP?
A: On the day immediately preceding the 1
51
H, he must be:
1. Present (worked), or
2. On LOA with pay. (Sec. 10, Rule IV,
Book III, IRR)
Q: What if the conditions are not met?
A: He must work on the 1st RH to,:ge entitled to
P on the 2
nd
RH. (Sec. 10, Rule' IV, Book III,
IRR)
Academics Committee
Chai r per son. Abraham D.Genuino II
Vi ce-Cbai r Jor Academi cs: J eannie ,\. Laurentino
Vi ce-Cbai r Jar .Admi n &F i nance: Aissa CelineH.Luna
Vi ce-Chai r Jar L qout &Desi en: Loise RaeG.Naval
Labor LawCommittee
Assi stant Subj ect H ead' Domingo B.Divrva V
Members:
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelleC.Lee
J emuel PaoloM.Lobo
)\ndrew W.Montesa
Maria Maica Angelika Roman
Pacu{ taa ae ([ )er ecl i o Ci vi C
LABOR STANDARDS: CONDITIONS OF EMPLOYMENT:
SERVICE INCENTIVE LEAVE
ART. 95. RIGHT TO SERVICE
INCENTIVE LEAVE"
Q: What is service incentive leave (SIL)?
A: It is 5 days leave with pay for every
employee who has rendered at least 1 yr of
service. It is commutable to its money
equivalent if not used or exhausted at the end
of year.
Q: What do you mean by at least 1year of
service?
A: 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 12months, in which case said period
shall be considered as one year. (Sec. 3, Rule
V, Book III, IRR)
Q: Who are entitled to SIL?
A:
GR: Applies to every Ee who has rendered
at least 1year of service. (Art. 95[a])
XPNS:
1.Government Ees and any of its
political subdivisions including GOCCs
2. Those already enjoying the benefit
personal services of another
4. Those already enjoying vacation leave
with pay of at least 5 days
5. Managerial Ees
6. Field personnel and other Ees whose
performance is unsupervised by the Er
7. Employed in establishments regularly
employing less than 10workers
8. Exempt establishments
9. Engaged on task or contract basis,
purely commission basis, or those who
are paid in a fixed amount of
performing work irrespective of the
time consumed in the performance
thereof. (Art. 95[b])
Q: Are teachers of private schools on
contract basis entitled to SIL?
A: Yes. The phrase "those who are engaged
on task or contract basis" should, however, be
related with "field personnel" applying the rule
on ejusdem generis that general and unlimited
terms are restrained and limited by the
particular terms that they follow. Clearly, Cebu
46
Institute of Technology teaching personnel
cannot be deemed as field personnel which
refers "to non-agricultural Ees who regularly
perform their duties away from the principal
place of business or branch office of the Er
and whose actual hours of work in the field
cannot be determined with reasonable
certainty. (Par. 3, Art. 82, LC). (CIT vs. Ople,
G.R. No. 70203, Dec. 18, 1987)
Q: Is SIL commutable to its monetary
equivalent if not used or exhausted at the
end of the year?
A: Yes. It is aimed primarily at encouraging
workers to work continuously and with
dedication to the company.
Q:.What is the basis for cash conversion?
A: 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. (No. VI(e), DOLE Handbook on
Worker's Statutory Monetary Benefit)
Q: Are part-time workers entitled to the full
benefit of the yearly 5day SIL?
A: Yes. Art. 95 of Labor Code speaks of the
number of months in a year for entitlement to
said benefit. (Bureau of Working Conditions
Advisory Opinion to Phil. Integrated Exporter's,
Inc.)
Q: Are piece-rate workers entitled to the full
benefit of the yearly 5 day SIL?
A: It depends.
1. Yes. Provided:
a. They are working inside the
premises of the employer (Er)
and
b. Under the direct supervision of
the Er.
2. No. Provided:
a. They are working outside the
premises of the Er
b. Hours spent in the performance
of work cannot be ascertained
with reasonable certainty
c. The are not under the direct
supervision of the Er
Q: Does it apply to Ees with salaries above
minimum wage?
A: No. The difference between the minimum
wage and the actual salary received by the
Ees cannot be deemed as their is" month pay
and SIL pay as such difference is not
equivalent to or of the same import as the said
benefits contemplated by law. (JPL Marketing
Promotions v. CA, GR. No. 151966, July 8,
2005.)
Q: Explain the entitlement of terminated
Ees to SIL.
A:
1. Illegally dismissed Ees - entitled to
SIL until actual reinstatement.
(Integrated Conirectoe and E;lumbing
Works, Inc. v. NLRC, G.R.No. Aug.9,
2005)
2. Legally dismissed Ees - the Ee who
had not been paid of SIL from outset
of employment is entitled only of such
pay after a year from commencement
of service until termination of
employment or contract. (JPL
Marketing Promotions v. CA, GR.
No. 151966, July 8,2005)
Q: What is the nature of vacation and sick
leave (VASl)?
A: It is voluntary. It lies- purely within
management discretion or an output of
collective bargaining agreement.
Q: What is the basis of VASl?
A: It is a result of
1. Collective bargaining negotiations or
2. Established employer practice or
policy, not granted by law
Q: How does an Ee enjoy VASl benefits?
A: It must be enjoyed by the Ee within 1 year,
thru established practice or policy of the Er
and cannot be unilaterally withdrawn by the
latter.
Q: What is the effect if not enjoyed within 1
yr?
A:
GR: Considered waived.
XPN: When the labor contract or the
established practice of the employer
provides otherwise.
Q: Can it be converted to cash?
A:
GR: No.
XPN: Unless allowed by the employer
Q: What is the reason for VASl?
A: Vacation leave is intended to give the
employees a rest from the monotony and
rigors of his daily work, on the other hand, sick
leave is meant to be enjoyed only during
actual illness.
Q: In the grant of vacation leave privileges
to an employee (Ee), is the employer (Er)
given the discretion to impose conditions
on its entitlement and commutation?
A: Yes.The grant of vacation leave is not a
standard of law, but a prerogative of
management. It is a mere concession or act of
grace of the Er and not a matter of right on the
part of the Ee. Thus, it is well within the power
and authority of an Er to impose certain
conditions, as it deems fit, on the grant of
vacation leaves, such as having the option to
schedule the same. (PNCC Skyway Traffic
Management v. PNCC Skyway Corp.,G.R. No.
171231, Feb. 17,2010)
Q: What is the solo parent leave (SPl)?
A: It is a leave of not more than 7 working
days granted every year to any solo parent Ee
who has rendered service of at least 1 yr.
(R.A. 8972)
Note: The terms and conditions of
employment cannot be prejudiced by reason of
having the status of a solo parent.
Q: Is the SPl convertible to cash?
A:
GR: No.
XPN: If specifically agreed upon otherwise,
and is non- cumulative. (R.A. 8972) Non-
compliance with the law may make the
employer liable for damages. (Azucena,
2007)
Q: What is the effect if there is a change in
status of the parent?
A: If the solo parent is no longer left alone with
the responsibility of parenthood it shall
terminate his/her eligibility for these benefits.
(R.A. 8972)
Q: What is battered woman leave (BWl)?
A: A female Ee who is a victim of violence
(physical, sexual or psychological) is entitled to
a paid leave of 10 days in addition to other
paid leaves. (R.A. 9262, Anti-VAWC Act)
UNIVERSITY OF SANTO TOMAS f.<U~47
Pacu{ tad de CJ)er ecl i o CiviC .~-
LABOR STANDARDS: CONDITIONS OF EMPLOYMENT:
SERVICE INCENTIVE LEAVE
Q: Is BWL extendible?
A: Yes, when the necessity arises. (R.A.
9262)
Q: What is special leave benefits for
women?
A: A woman Ee having rendered continuous
aggregate employment service of at least 6
months for the last 12 months shall be entitled
to a special leave benefit of 2 months with full
pay based on her gross monthly compensation
following surgery caused by gynecological
disorders. (Sec. 18, R.A. 9710)
48
Academics Committee
Vi ce-Chai r for L r yout &Desi gn: Loise Rae G.Naval
Labor LawCommittee
Subj ect H ead: Lester J ay AlanE.Flores II
Assi stant Subj ect H ead: Domingo B.Diviva V
Members:
Diane Camilla R.'Borja
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
]eanelle C.Lee
]emuel PaoloM.Lobo
Andrew W.Montesa
; " ART. 96. SERVICE CHARGES
Q: What are service charges (SC)?
A: These are charges collected by hotels,
restaurants and similar establishments and
shall be distributed at the rate of:
To answer fqr losses and
breakages and
Distributed to Ees receiving
more than P2000 a month at
the discretion of the
management.
1.
Equally
distributed
among them
2.
Q: Who are covered Ees?
A:
GR: All Ees are covered, regardless of
their position, desiqnation, employment
status, irrespective of the method by which
their wages are paid.
Note: Applies only to hotels; restaurants and
similar establishment collecting service
charges.
XPN: Managerial Ees. (Sec. 2, Rule VI,
Book JIJ, IRR)
Q: When is the share of employee
distributed and paid to them?
A: Not less than once every 2 weeks or twice
a month at intervals not exceeding 16days.
Q: What happens If the SC is abolished?
A: The share of the covered Ees shall be
considered integrated in their wages on the
basis of the average monthly share of each
Ees for the past 12 months immediately
preceding the abolition.
Note: Service charges form part of the award in
illegal dismissal cases.
Q: What is the difference between tip and
SC?
A:
SERVICE CHARGE' TIP' -
What you give to the
waiter/waitress after
eating if you like their
service
What the restaurant
requires you to pay for
the benefit of its Ees
Voluntary contribution
Not a voluntary
contribution on the part
of the customer
Note: Since a tip is considered a pure gift out of
benevolence or friendship. it cannot be
demanded from the customer. Whether or not
tips will be given is dependent on the will and
generosity of the giver. Although a customer may
give a tip as a consideration for services
rendered, its value still depends on the giver.
They are given in addition to the compensation
by the employer. A gratuity given by an employer
in order to inspire the employee to exert more
effort in his work is more appropriately called a
bonus.
Q: What happens to the tips given freely
by customers?
A: Pooled tips should be monitored, accounted
for and distributed in the same manner as the
service charges where a restaurant or similar
establishment does not collect service charges
but has a practice or policy of monitoring and
pooling tips given voluntarily by its customers.
(No. 7[c] DOLE Handbook on Workers
Statutory Monetary Benefits)
Academics Committee
' Vi ce-Char for .Academi cs: J eannie i \. Laurentino
Vi ce-Chai r for Admi n ri'7' F i nance: Aissa Celine H. Luna
Vi ce Chai r for L aJ10ut &Desi gn: Loise Rae G. Naval
Labor LawCommittee
Subj ect H ead' Lester] ay Alan E. Flores II
.Assi stant Subj ect H ead' Domingo B. Diviva V
Members:
Christian Nirio A. Diaz
Angelo S. Diokno
Genesis R.Fulgencio
J eanelle C.Lee
J emuel Paolo M.Lobo
Andrew W.Montesa
Pacu{taa de ([)erecno Ci vi C
LABOR STANDARDS: WAGES
, TITLE 2 WAGES
, CHAPTER I
l PRELIMINARY MA TIERS '
: ' , ' ,A,~T. ,9.7. DEFINITION , "", '- , !
Q: What is a wage?
A: It is the 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, payable
by an employer (Er) to an employee (Ee)
under a written or unwritten contract of
employment:
1, For work done or to be done, or for
services rendered or to be rendered;
and includes
2, Fair and reasonable value of board,
lodging, or other facilities customarily
furnished by the Er to the E,e as
determined by SLE,
Q: What do you mean by customary?
Q: What does a "fair day's wage for a fair
day's labor "mean (no work no pay)?
A:
GR: If there is no work performed by the
Ee, without the fault of the Er, there can be
no wage or pay,
XPN: 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
5, Otherwise illegally prevented from
working, (Aklan Electric Coop, v.
NLRC, G.R No, 129246, Jan. 25,
2000)
Q: What is equal pay for equal work?
A: Ees who work with substantially equal
qualifications, skill, effort and responsibility,
under similar conditions, should be paid similar
salaries, (Int'I School Alliance of Educators v.
Quisumbing, G.R No, 128845, June 1, 2000)
A: It is founded on long-established and
constant practice connoting regularity, A:
Q: What are included in wage or salary?
Q: What do you mean by fair and
reasonable value?
A: It shall not include any profit to the
employer (Er) or to any person affiliated with
the Er.
Q: Distinguish between wage and salary?
A:
WAGE .' SALAR .
(Ga<? vs.CA, GR No 44169, Dec. 3,1985)
Compensation for
manual labor (skilled or
unskilled) paid at stated
times and measured by
the day, week, month
or season.
GR: Not subject to
execution
Subject to execution,
Denotes higher degree
of employment or a
superior grade of
services and implies a
position in office.
Considerable pay for a
lower and less
responsible character
of em 10 rnent,
Out gesture of a larger
and more important
service
XPN: Debts incurred
for food, shelter,
clothing and medical
attendance.
50
1, Commission
2. Facilities
3, Commodities and supplements
Q: What is commission?
A: Direct remuneration received by an agent,
salesman, executor, broker, or trustee
calculated as a percentage on the amount of
his transactions or on the profit to the principal.
Q: Are sales commission earned by a
salesman who make or close a sale of
duplicating machines' distributed by Phil.
Duplicators Corp., constitute part of his
"wage" or "salary"?
A: Yes. Sales commission form part of the
"wage" or "salary" of salesmen and are not in
the nature of an "allowance" or "additional
fringe" benefit. Commissions are in the form of
incentives of encouragement, so that the
salesman would be inspired to put a little more
industry on the jobs particularly assigned to
them, The nature of the work of a salesmen
and the reason for such type of remuneration
for services rendered demonstrate clearly that
commissions are part of salesman wage or
salary. (Phil. Duplicators, Inc. v. NLRC, G.R
No, 110068, Nov. 11, 1993)
Q: Distinguish between facilities and
supplement?
A:
.~..,
FACILITIES
.--
. SUPPLEMENT
~':"', .
Items of expenses
Extra remuneration or
necessary for the
special privileges or
laborer's and his
benefits given to or
family's existence and
received bythe
subsistence
laborers over and
Note: Does not include
above their ordinary
earainqs 01: wages
tools of trade or articles/
(Atok Big Wedge
services primarily for the
Mining Co. v, Atok Big
benefit of the Er or
Wedge Mutual Benefit
necessary to the
Assoc, G.R. No. L-
conduct of the Er's
7349, July 19, 1955) .
business.
Forms part of the wage Independent of wage
Deductible from wage Not wage deductible
For the benefit of the
Granted for the
convenience of the
worker and his family.
Er.
Q: What is the criterion in determining
whether an item is a supplement or facility?
A: The criterion is not so much with the kind of
the benefit or item (food, lodging, bonus or sick
leave) given, but its purpose. (State Marine v.
Cebu Seamen's Ass'n., G.R. No. L-12444,
Feb. 28, 1963) ..
Q: When can the cost of facilities furnished
by the Er be charged against an Ee?
A: In order that the cost be charged against
the Ee, the latter's acceptance of such facilities
must be voluntary.
Q: What are the requirements for deducting
values for facilities?
A:
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
3. The facilities must be charged at fair
and reasonable value (Mabeza v,
NLRC, G.R. No. 118506, April 18,
1997)
Q: Are food and lodging, or the electricity
and water consumed by a hotel worker,
considered facilities?
A: No. These are supplements. Considering,
therefore, that hotel workers are required to
work different shifts and are expected to be
available at various odd hours, their ready
availability is a necessary matter in the
operations of a small hotel. Furthermore,
granting that meals and lodging were provided
and indeed constituted facilities, such facilities
could not be deducted without the Er
complying first with certain legal requirements.
These requirements were not met in the
instant case. (Mabeza v. NLRC, G.R. No.
118506, April 18, 1997)
Q: What is gratuity pay?
A: It is something given freely to reward Ees
who have rendered satisfactory and efficient
service to the company. It does not fonm part
of the wage.
Q: What are allowances?
A: Amounts of money given in consideration of
certain expenses like transportation and
representation. It does not form part of the
wage.
ART. 98. APPLICATION OF TITLE
Q: To whom does the title on wages apply?
A:
GR: It applies to all employees
XPN:
-1-. -Farm tenancy or leasehold;
2. Household or domestic helpers,
including family drivers and persons
working in the personal service of
another;
3. Home workers engaged in
needlework or in any cottage industry
duly registered in accordance with
law'
4. Wo~kers in duly registered
cooperatives when so recommended
by the Bureau of Cooperative
Development and upon approval of
the Secretary of Labor and
Employment:
5. Workers of a barangay micro
business enterprise (R.A. 917E})
PacuCtaa ae r Der ecno Ci vi C
. , . CHAPTER II . "
, MINIMUM WAGE RATES
: ART. ,99. REGIONALMINIMUM ..VVAGES '-;
Q: What is minimum wage?
A: It is the lowest basic wage rate fixed by law
that an employer (Er) can pay his employees
(Ees),
Q: What is regional minimum wage?
A: The minimum wage rates for agricultural
and non-agricultural Ees and workers in each
and every region of the country shall be those
prescribed by the Regional Tripartite Wages
and Productivity Board (RTWPB).
Q: What is statutory minimum wage?
A: This shall refer to rate fixed by the RTWPB,
as defined by the Bureau of Labor and
Employment Statistics (BLES) of the DOLE,
(RA 9504)
Q: Who are minimum wage earners?
A: Workers in the private sector paid the
statutory minimum wage, or to an employee in
the public sector with compensation income of
not more than the statutory minimum wage in
the non-agricultural sector where he/she is
assigned, (RA 9504)
Q: Are minimum wage earners exempt from
payment of income tax on their taxable
income?
A: Yes, provided that the holiday pay, overtime
pay, night shift differential pay and hazard pay
received by such minimum wage earners shall
likewise be exempt from income tax. (RA
9504)
Q: Who are daily-paid Ees?
A: Ees paid only for days he actually worked.
Q: Who are monthly paid Ees?
A: Ees paid by the month, irrespective of the
number of working days, with a salary not
below the established minimum wage, shall be
presumed to be paid for all the days in the
month whether worked or not. The monthly
minimum wage shall not be less than the
statutory minimum wage multiplied by 365
days divided by 12.
52
Q: What is the purpose of fixing a minimum
wage?
A:
1. Provide rock-bottom wage to be paid
to Ees by Ers and below which the
rate must not fall,
2. Gives protection to enlightened Er
who without legal compulsion
voluntarily pays a decent wage
against competition of Er who pays
Ee inadequate wages and thus
operates at -a lower cost and sell
products at lower price,
Q: Can an Er be exempt from his obligation
to pay minimum wages because of poor
financial condition of the company?
A: No. The payment of minimum wage is not
being dependent on the Ers ability to pay.
Payment of wage is a mandatory statutory
obligation. (De Racho VS. Mun. of J/agan, G.R.
No. L-23542, Jan. 2, 1968)
Q: Can an Ee be estopped in suing his Er
by accepting his wage below the minimum
wage without objection?
A: No. It does not give rise to estoppel. The Ee
can still sue his Er for the difference between
the amount received and the amount he
should have received pursuant to a valid
minimum wage law where it does not appear
that the Er changed his position to his own
prejudice.
( ARTS. 122. CREATION OF THE REGIONAL
; TRIPARTITE WAGES AND PRODUCTIVITY
, BOARD (RTWPB) ,
Q: Who may set the minimum wage?
A:
1. RTWPB
2, Congress
Q: What is the duty of RTWPB?
A: Prescribe the minimum wage rates for
agricultural . and non-agricultural Ees and
workers in each and every region of the
country,
Q: What is the composition of RTWPB?
A:
1, Regional Director of DOLE
2. Regional Director of NEDA
3. Regional Director of DTI
4. 2 members from the employers'
sector
5. 2 members from the workers' sector;
and
6. Secretariat
;::t~:"':A.J ~T:,124.:~;rANDA~DSICRITERIA .
r,:r- ' i ,." : . FOR"MfNIMUM WAGE FIXING .:
Q: What are standards or criteria for
minimum wage fixing?
A:
1. Demand for living wages
2. Wage adjustment vis-a-vis the
consumer price index
3, Cost of living and changes or
increase therein
4. Needs of workers and their families
5. Need to induce industries to invest in
the countryside
6. Improvements in standards of living
7. Prevailing wage levels
8. Fair return of capital invested and the
capacity to pay of Ers
9. Effects on employment generation
and family income
10. Equitable distribution of income and
wealth along the imperatives
Q: What is salary ceiling method?
A: A method of minimum wage adjustment
whereby the wage adjustment is applied to
Ees receiving a certain denominated ceiling. In
other words, workers already being paid more
than the existing minimum wage are also to be
given a wage increase. (ECOP v. NWCP, G.R.
No. 96169, Sep. 24, 1991).
Q: What is a floor wage method?
A: It involves the fixing of a determinate
amount to be added to the prevailing statutory
minimum wage rates.
Q: The Regional Wage Board of Region \I
issued a Wage Order granting all Ees in the
private sector throughout the region an
across-the-board increase of P15.00 daily.
Is this Wage Order valid?
A: The Wage Order is valid insofar as the
mandated increase applies to Ees earning the
prevailing minimum wage rate at the time of
the passage of the Wage Order and void with
respect to its application to Ees receiving more
than the prevailing minimum wage rate at the
time of the passage of the Wage Order.
Pursuant to its authority, the Regional Wage
Boards may issue wage orders which set the
daily minimum wage rates. In the present
case, the Regional Wage Board did not
determine or fix the minimum wage rate. It did
not set a wage level nor a range to which a
wage adjustment or increase shall be added.
Instead, it granted an across-the-board wage
increase of P15.00 to all Ees in the region. In
doing so, the Regional Wage Board exceeded
its authority by extending the coverage of the
Wage Order to wage earners receiving more
than the prevailing minimum wage rate,
without a denominated salary ceiling. The
Wage Order granted additional benefits not
contemplated by R.A. No. 6727. (MBTC v
NWPC Commission, G.R. No. 144322, Feb. 6,
2007)
Q: Since the Wage Order was declared void
with respect to its application to employees
receiving more than the prevailing
minimum wage rate at the time of the
passage of the Wage Order, should these
Ees refund the wage increase received by
them?
A: No. The Ees should not refund the wage
increase that they received under the
invalidated Wage Order. Being in good faith,
the employees need not refund the benefits
they received. Since they received the wage
increase in good faith, in the honest belief that
they are entitled to such wage increase and
without any knowledge that there was no legal
basis for the same, they need not refund the
wage increase that they already received.
(MBTC v NWPC Commission, G.R. NO.
144322, Feb. 6, 200~
Q: What is wage distortion (WO)?
A: A situation where an increase in wage
results in the elimination or severe contraction
of intentional quantitative differences in wage
or salary rates between and among the Ee-
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.
Q: What are the elements of WO?
A:
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 2 groups or classes; and
4. The WD exists in the same region of
the country. (Alliance Trade Unions v.
UN!VERSITY OF SArHO TOMAS
Pacu(taa de (])erecfio Civif
NLRC, G.R. No. 140689, Feb. 17,
2004)
Q: Is the Er legally obliged to correct WD?
A: The Er and the union shall negotiate to
correct the distortions. If there is no union, the
Er and the workers shall endeavor to correct
such distinctions.
Q: What are the basic principles in WD?
A:
1. The concept of WD assumes an
existing group or classification of Ees
which establishes distinctions among
such Ees on some relevant or
legitimate basis. This classification is
reflected in a differing wage rate for
each of the classes of Ees
2. Often results from gov't decreed
increases in minimum wages.
3. Should a WD exist, there is no legal
requirement that, in the rectification of
that distortion by re-adjustment of the
wage rates of the differing classes of
Ees, the gap which had previously or
historically existed be restored in
precisely the same amount. In other
words, correction of a WD may be
done by reestablishing a substantial
or significant gap (as distinguished
from the historical gap) between the
wage rates of the differing classes of
Ees.
4. The re-establishment of a significant
difference in wage rates may be the
result of resort to grievance
procedures or collective bargaining
negotiations. (Metro Transit Org., Inc.
v. NLRC, GR. No. 116008, July 11,
1995)
Q: Distinguish the process. for correction of
WD of organized establishments and
unorganized establishments?
A:
Organized Unorganized
; Establishment Establishments
(with union) (without union)
The Er and the union The Er and the workers
shall negotiate to shall endeavor to
correct distortion. correct the distortion.
Any dispute shall be
Any dispute shall be
resolved through a
grievance procedure
settled through the
under the CSA.
NCMB.
If it remains
If it remains unresolved
unresolved, it shall be
dealt with through
within 10days it shall
voluntary arbitration.
be refers to the NLRC.
The dispute will be The NLRC shall
54
conduct continuous
hearings and decide
the dispute within 20
days from the time the
same was referred.
resolved within 10
days fromthe time the'
dispute was referred to
Q: Can the issue of WD be raised in a
notice of strike?
A: No. WD is non-strikeable. (flaw at Buklod
ng Manggagawa v. NLRC, G.R. No. 91980,
June 27, 1991.) WD is neither a deadlock in
collective bargaining nor.ULP.
. ART. 100. PROHIBITION AGAINST
: ELIMINATION OR DIMINUTION OF
. BENEFITS
Q: What is the concept of non-diminution
(ND) of benefits?
A:
GR: Benefits being given to employees
(Ees) cannot be taken back or reduced
unilaterally by the employer (Er) because
the benefit has become part of the
employment contract, whether written or
unwritten.
XPN: To correct an error, otherwise, if the
error is not corrected for a reasonable time,
it ripens into a company policy and Ees can
demand it as a matter of right.
Q: When is ND applicable?
A: It is applicable if it is shown that the grant of
benefit:
1.
2.
Is based on an express policy of the
law; or
Has ripened into practice over a long
period of time and the practice is
consistent and- deliberate and is not
due to an error in the construction/
application of a doubtful or difficult
question of law.
Q: What are the tests ascertaining
existence of binding and enforceable
. company practice?
A: The act of the employer:
1. Has been done for a long period of
time;
2. Has been done consistently and
intentionally;
3. Should not have been a product of
erroneous interpretation or
construction of a doubtful or difficult
question on law.
Q: What is a bonus?
A: It is an amount granted and paid to an Ee
for his industry and loyalty which contributed to
the success of the Ers business and made
possible the realization of profits.
Q:Canbonusbedemanded?
A:
GR: Bonus is not demandable as a matter
of right. It is a management @rerogqtive
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, March 28, 2001)
XPN: Given for a long period of time
1. Consistent and deliberate - Er
continued giving benefit without any
condition imposed for its payment
2. Er knew he was not required to give
benefit
3. Nature of benefit is not dependent on
profit
4. Made part of the wage or
compensation agreed ana stated in
the employment contract.
Q: The projected bonus for the Ees of
Suerte Co. was 50% of their monthly
compensation. Unfortunately, due to the
slump in the business, the president
reduced the bonus to 5% of their
compensation. . Can the company
unilaterally reduce the amount of bonus?
Expiain briefly.
A: Yes. 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, March 28, 2001). (2002 Bar
Question)
Q: What is covered by basic salary?
A: All remunerations or earnings paid by its Er
'or services rendered.
Note: For Ees receiving regular wage, the term
oaslc salary does not mean the amount actually
eceived by an Ee, but 1/12 of their standard
onthly wage multiplied by the length of their
service within a given calendar year. The
ayments of sick, vacation, and maternity leaves,
ight differentials, holiday pay, and premiums for
Nork done on rest days and special holidays are
excluded from the computation of basic salary.
(Honda Phil., Inc. v. Samahan ng Malayang
Manggagawa sa Honda, G.R. No. 145561, June
15,2005)
Q: What are excluded in basic salary?
A: Allowances and monetary benefits which
are not considered integrated as part of the
regular or basic salary such as vacation and
sick leave credits, OT, premium, night
differential, holiday pay and COLA. Provided:
they are treated as part of the basic salary if
provided by reasons of individual or collective
bargaining or company practice or policy.
Q: Suarez is a salesman for Star
Pharmaceuticals. Star Pharmaceuticals has
applied with the DOLE for clearance to
terminate (by way of retrenchment) the
services of Suarez due to financial losses.
He, aside from his monthly salary, receives
commissions on the sales he makes and
allowances. The existing CBA between Star
Pharmaceuticals and the union, of which
Suarez is a member, states that any Ee
separated from employment for causes not
due to the fault of the Ee shall receive from
the company a retirement gratuity in an
amount equivalent to one month's salary
per year of service. Suarez contends that in
computing his separation pay, his sales
commission and his allowances should be
included in the monthly salary. Do you
agree?
A: I agree, with some conditions. In computing
separation pay, the monthly salary should
include commissions because a commission
received by a salesman is part of his salary.
But for allowances to be included as part of
salary, they should be for services rendered or
to be rendered, like a cost of living allowance.
But transportation and representation
allowances are not considered as part of
salary because they are to meet expenses for
transportation and representation. Thus, cost
of living allowances, but not transportation or
representation allowances, shall be included
as part of salary in the computation of
separation pay. (1997 Bar Question)
l F acuCtaa de i ] )er ecno Ci vi C
55
,- ART. 101. PAYMENT BY RESUtTS - "
Q: What does payment of wages by results
include?
A:
1. Pakyaw
2. Piece-work
3. Other non-time work
Note: It is regulated by DOLE Sec. to ensure the
payment of fair and reasonable wage rates,
preferably through time and motion studies or in
consultation with representatives of workers and
Er's organizations.
Q: What are the two categories of piece-
rate workers?
A:
1. As to presence of control
a. Piece-rate worker works
directly under the supervision of
their Er.
b. Pakyaw or takay - works away
from the Ers work premises and
are not directly supervised by the
Er.
2. As to rate of payment
a. Those who are paid rates as
prescribed in Piece Rate Orders
by the DOLE
b. Those who are paid output rates
which are prescribed by the Er
and are not yet approved by the
DOLE.
Q: Who are non-time workers?
A: They are workers paid according to the
quantity, quality or kind of job and the
consequent results thereof.
Q: Who are workers paid on piece-rate
basis?
A: Workers paid by 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.
56
Q: Distinguish piece rate Ee from task work
Ee.
A:
;-: PIECE RATE - '. -:TASKWORK' "
Stress is placed on the
unit of work produced,
or the quantity thereof.
Emphasis on the task
itself
Payment is not
reckoned in terms of
numbers of unit
produced, but in terms
of completion of work,
Uniform amount is paid
per unit accomplished
Q: What are the benefits payable to piece-
rate workers?
A:
1_ Thirteenth month pay
2. Night shift differential (NSD) pay
3. Service incentive leave of five days
with pay
4. Holiday pay
5. Applicable statutory minimum daily
rate
6. Meal and rest periods
7. Premium pay (conditional)
8. Overtime pay (conditional)
9. Other benefits granted by law,
individual or collective bargaining
agreements or company policy or
practice.
Note: The rules implementing the Labor Code
(LC) on NSD and SIL do not apply to Ees whose
time and performance is unsupervised by the Ers,
including those who are engaged on task or
contract basis, purely commission or those who
are paid a fixed amount for performing work
irrespective of the time consumed in the
performance thereof.
Q: TRX, a local shipping firm, maintains a
fleet of motorized boats plying the island
barangays of AP, a coastal town. At day's
end the boat operators/crew members turn
over to the boat owner their cash
collections from cargo fees and passenger
fares, less the expenses for diesel fuel,
food, landing fees and spare parts .. 50% of
the monthly income or earnings derived
from the operations of the boats are given
to the boatmen by way of compensation.
Deducted from the individual shares of the
boatmen are their cash advance and peso
value of their absences, if any. Are these
boatmen entitled to OT pay, holiday pay,
and 13th month pay?
A: If the boatmen are considered Ees, like
jeepney drivers paid on a boundary system,
the boatmen are not entitled to O'T and holiday
pay because they are workers who are paid by
~~~~==~~~~~- -
results. Said workers, under the LC are not
entitled, among others, to OT pay and holiday
pay. In accordance with the rules and
regulations implementing the 13th month pay
law, however, the boatmen are entitled to the
13th month pay. Workers who are paid by
results are to be paid their 13th month pay.
(2004 Bar Question)
~ ART. 102. FORMS OF PAYMENT
~ "
Q: What is the form of payment of wages?
A:
GR: Wages shall be paid in legal tender.
XPN: Payment of wages by bank checks,
postal checks or money orders is allowed
where such manner of wage payment is:
1. Customary on the date of the
effectivity of the Labor Code.
2. Stipulated in the CBA.
3. Where all of the following conditions
are met:
a. There is a bank or other facility
for encashment within a radius of
1 km. from the workplace;
b. The Er or any of its agents or
representatives does not receive
any pecuniary benefit directly or
indirectly from the arrangement.
c. The Ees are given reasonable
time during banking hours to
withdraw their wages from the
bank which time shall be
considered as compensable
hours worked if done during
working hours.
d. Payment by check is with
consent of the Ees concerned IF
there is no CBA authorizing
payment of wages by bank
checks.
4. Other instances when necessary
because of special circumstances as
specified in appropriate regulations to
be issued by the SLE.
Q: Are the use of tokens, promissory notes,
coupons vouchers or any other form
allowed?
A: No. Any form alleged to represent legal
tender is absolutely prohibited even when
expressly requested by the Ee.
. . ART. 103. TIME OF PAYMENT
Q: When should wages be paid?
A:
GR: Wages shall be paid
1. At least once every 2weeks, or
2. Twice a month at intervals not
exceeding 16days
Note: No Er shall make payment with
less frequency than once a month.
XPN: Payment cannot be made with such
regularity:
1. Due to force majeure or
circumstances beyond the employer's
control.
2. If engaged to perform a task which
cannot be completed in 2 weeks and
in the absence of CBA.
Q: How can payment be made in case of
force majeure or circumstances beyond the
Ers control?
A: Er shall pay wages immediately after such
force majeure or circumstance has ceased.
Q: How will wages of employees engaged
to perform a task which cannot be
completed in 2weeks be paid?
A: In the absence of a CBA or arbitration
award:
1.
2.
Payment is made at intervals not
exceeding 16 days, in proportion to
the amount of work completed.
Final settlement is made immediately
upon completion of work.
ART. 104. PLACE OF PAYMENT
Q: Where is the place of payment of
wages?
A:
GR: Place of payment shall be at or near
the place of undertaking.
XPN: Permissible only under the following
circumstances:
1. When payment cannot be effected at
or near the place of work
a. by reason of the deterioration of
the peace and order conditions
or
b. by reason of actual or impending
emergencies covered by fire,
flood, epidemic, or other calamity
c. rendering payment thereat
permissible;
UNiVERSITY OF SANTi,.) ~rO~f1.!\S
Pacu{ tati ti e Der echo Ci vi C
2. When the employer (Er) provides free
transport to the employee (Ee) back
and forth;
3. Any analogous circumstances
provided that the time spent by the
Ee in collecting their wage shall be
considered compensable hours
worked.
Q: What are the prohibited places of
payment?
A:
GR: Places where games are played with
stakes of money or things representing
money like:
1. Bar;
2. Night club;
3. Day club;
4. Drinking establishment;
5. Massage clinic;
6. Dance hall;
7. Other similar places or in places
XPN: In case of workers employed in said
places. .
Q: When can payment thru banks be
permitted?
A:
1. Written permission of the majority of
the Ees concerned in the
establishments
2. Establishment must have 25 or more
Ees
3. Establishment must be located within
1 km. radius to the bank. (Sec. 7,
Wage Rationalization Act, R.A. 6727)
Q: What is the duty of the bank?
A: Whenever applicable and upon request of a
concerned worker or union, the bank shall
issue a certification of the record of payment of
wages of a particular worker or workers for a
particular payroll period.
Q: Is payment through ATMs allowed?
A: Yes. Provided:
1. The ATM system of payment is with
the written consent of the Ee
concerned;
2. The Ees are given reasonable time to
withdraw their wages from the bank
facility which, if done during the
working hours, shall be considered as
compensable hours worked;
3. The system shall allow the Ee to
receive their wage within the period
and in the amount prescribed under
the LC.
4. There is a bank or ATM facility within
a radius of 1 km. from the workplace;
5. Upon the request of the concerned
Ee, the Er shall issue a record
evidencing payment of wages,
benefits and deductions for a
particular period;
6. The ATM system of payment shall
neither result in diminution of benefits
and privileges of the Ee nor shall the
latter incur additional expenses in the
process; and,
7. The Er shall assume full responsibility
in case the wage protection
provisions of law and regulations are
not complied with under the
arrangement (DOLE's Explanatory
Bulletin on Wage Payment through
ATM Facility, Nov. 25, 1996)
- ART. 105. DIRECT PAYMENT OF WAGES
Q: How should payment of wages be
made?
A:
GR: It shall be made directly to the Ees
entitled thereto.
XPN:
1. Force majeure rendering such
payment impossible or under other
special circumstances in which the
worker may be paid:
a. Through another person under
written authorization, or
b. Upon authorization to a member
of his family.
Authorized by existing laws
a. Payment for the insurance
premiums of the Ee and
b. Union dues where the right to
check off is provided in CBA or
c. Authorized in writing by the
individual Ees concerned. (Sec.
5, Rule VIII, Book III, IRR).
2.
3. In case of death of the Ee, in which
case it will be paid directly to the
worker's heirs.
Q: What is the procedure in case of
payment through heirs of worker?
A:
1. When the heirs are of age, they shall
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.
2. In case any of the heirs is a minor,
such affidavit shall be executed in his
behalf by his natural guardian or next
kin.
3. Affidavit shall be presented to the Er
who shall make payment through the
DOLE Secretary or his
representative.
4. Payment of wage shall absolve the Er
of any other liability ~with respect to
the amount paid.
Academics Committee
Vi ce-Chai r j or .Academi cs: J eannie A.Laurentino
Vi ce-Chai r for Admi n &F i nance: A..issaCehneH.Luna
Vi ce-Chai r for L ayoi &Desi gn: Loise RaeG.Naval
Labor Law Committee
Subj ect H ead: Lester J ayAlanE.Flores II
Members:
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelle CLee
J emuel PaoloM.Lobo
Andrew W.Montesa
UNiVERSITY OF SANTO TOMAS
Pacu{ taa de CDer ecl i o Civif
59
LABOR STANDARDS
I ART. 106. CONTRACTOR OR
:. SUBCONTRACTOR
Q: What is a permissible job contracting or
subcontracting?
A: It refers to an arrangement whereby a
principal agrees to farm out with a contractor
or subcontractor the performance of a specific
job, work, or service within a definite or
predetermined period, regardless of whether
such job, work or, service is to be performed or
completed within or outside the premises of
the principal.
Under this arrangement, the following
conditions must be met:
1. The contractor carries on a distinct
and independent business and
undertakes the contract work on his
account under his own responsibility
according to his own manner and
method, free from the control and
direction of his employer or principal
in all matters connected with the
performance of his work except as to
the results thereof;
2. The contractor has substantial capital
or investment; and
3. The agreement between the principal
and contractor or subcontractor
assures the contractual employees
entitlement to all labor and
occupational safety and health
standards, free exercise of the right to
self-organization, security of tenure,
and social welfare benefits. (Gal/ego
v. BAYER Phi/s., lnc., GR. No.
179807, July 31, 2009, J . Carpio-
Morales)
Q: Describe the relationship arising from
contractual arrangements.
A: There is a trilateral relationship between the
principal, contractor and Ee. There exists a
contractual relationship between the principal
and the contractor or subcontractor to its Ees.
Q: Who are the parties in contracting and
subcontracting?
A:
1. Contractor/subcontractor - Refers to any
person engaged in a legitimate
contracting or subcontracting
arrangement.
2. Contractual Ee - One who is employed by
a contractor or subcontractor to perform or
complete a job, work, or service pursuant
60
to an arrangement between the latter and
a principal. (0.0. 18-02)
3. Principal - Any Er who puts out or farms
out a job, service, or work to a contractor
or subcontractor.
Q: What are the factors to consider in
determining whether contractor is carrying
on an independent business?
A:
1. Nature and extent of work
2. Skill r~quired
3. Term and duration of the relationship
4. Right to assign the performance of
specified pieces of work
5. Control and supervision of worker
6. Power of employer to hire, fire and
pay wages
7. Control of the premises
8. Duty to supply premises, tools,
appliances, materials and labor
9. Mode, manner and terms of payment.
(Vinoya v. NLRC, G.R. No. 126286,
Feb 2, 2000)
Note: Individuals with special skills; expertise or
talent enjoy the freedom to offer their services as
independent contractors. An individual like an
artist or talent has a right to render his services
without anyone controlling the means and
methods by which he performs his art or craft.
(Sonza VS. ABS-CBN, G.R. No. 138051, June 10,
2004)
Q: Is the Sonza doctrine on "talents"
applicable to other workers of ABS-CBN,
such as production assistants and
production crew?
A: No. In the selection and engagement of the
production assistants and production crew, no
peculiar or unique skill, talent or celebrity
status was required from them since they were
merely hired through the company's personnel
department just like any ordinary Ee. Their so-
called "talent fees" correspond to wages given
as a result of an Er-Ee relationship. They did
not have the power to bargain tor huge talent
fees, a circumstance negating independent
contractual relationship. The presumption is
that when the work done is an integral part of
the regular business of the employer and when
the worker, relative to the employer, does not
furnish an independent business or
professional service, such work is a regular
employment of such employee and not an
independent contractor. (ABS-CBN v.
Marquez, June 22, 2005; ABS-CBN v.
Nazareno, Sep. 26, 2006)
Q: What are the rights of a contractual Ee
(CEe)?
A: They shall be entitled to all the rights and
privileges due to a regular Ee as provided in
the LG, as amended to include the ff:
1. Safe and healthful working
2.
conditions;
SI~ rest days, OT pay, holiday pay,
13 month pay and separation pay;
Social security and welfare benefits;
Self-organization, GSA) and eeaceful
concerted actions; '.
Security of tenure (Sec. 8, DO 18-02)
3.
4.
5.
Q: What are the effects of termination of
CEe to separation pay and other benefits?
A:
1. If prior to the expiration of the
employment contract between the
principal and the contractor or
subcontractor - The right of GEe to
separation payor other related
benefits shall be governed by the
applicable laws and jurisprudence on
termination of employment.
2. If the termination results from the
expiration of the contract between the
principal and the contractor or
subcontractor - The Ee shall not be
entitled to separation pay. However,
this is wlo prejudice to completion
bonuses or other emoluments
including retirement pay as may be
provided by law or in the contract
between the principal and the
contractor.
Q: When is the principal deemed the
employer of the contractual employee?
A: Where:
1. There is labor-only contracting
2. The contracting arrangement falls
within the prohibited acts
Q: May the Er or indirect Er require the
contractor or subcontractor to furnish a
bond equal to the cost of labor under
contract to answer for the wages due to
Ees in case the contractor or subcontractor
fails to pay the same?
A: Yes. The Er or indirect Er may require the
contractor or subcontractor to furnish a bond
that will answer for the wages due to the Ees.
Q: What is the liability of the principal?
A: The principal shall be solidarily liable with
the contractor in the event of any violation of
. ~.
any provision of the LG, including the failure to
pay wages. This will not prevent the principal
from claiming reimbursement from the
contractor.
Q: What does substantial capital or
investment mean?
A: It refers to the capital stocks and
subscribed capitalization in case of
corporations, tools, equipments, implement,
machineries and work premises, actually and
directly used by the contractor or
subcontractor in the performance or
completion of the job, work or service
contracted out. (D. O. 18-02)
Note: The law does not require both substantial
capital and investment in the form of tools
equipments, machineries, etc. This is clear fro~
the use of conjunction "or". If the contention was
to require the contractor to prove that he has both
capital and requisite investment, then the
conjunction "and" should have been used.
(Virginia Neri v. NLRC, G.R. No. 97008, July 21,
1993)
Q: What does the right to control mean?
A: It refers to the right reserved to the person
for whom the services of the contractual
workers are performed, to determine not only
the end to be achieved, but also the manner
and means to be used in reaching that end.
(~.O. 18-02)
Q: SMC and Sunflower Cooperative entered
into a 1-yr Contract of Services, to be
renewed on a month to month basis until
terminated by either party, Pursuant to the
contract, Sunflower engaged private
respondents to render services at SMC's
Bacolod Shrimp Processing Plant. The
contract was deemed renewed by the
parties every month after its expiration on
J an, 1, '94 and respondents continued to
perfonn their tasks until Sep, 11, '95. In
J uly '95, private respondents filed a
complaint before the NLRC, praying to be
declared as regular Ees of SMC, with
claims for recovery of all benefits and
privileges enjoyed by SMC rank and file
Ees. Respondents subsequently filed an
Ame"tlded Complaint to include illegal
dismissal as additional cause of action
following SMC's closure of its Bacolod
Shrimp Processing Plant on which resulted
in the termination of their services. SMC
filed a Motion for Leave to File Attached
Third Party Complaint to implead
Sunflower as 3
rd
-Party Defendant. Are
private respondents Ees of . the
lFac'u{tad' de lDerecfio CiviC
LABOR STANDARDS
independent cooperative
(Sunflower) or of the SMC?
contractor
A: The contention of SMC holds no basis.
Using the "substantial capital" doctrine and the
"right of control test", the Court found that the
Sunflower had no substantial capitai in the
form of tools, equipment, machineries, work
premises and other materials to qualify itself
as an independent contractor. The lot,
building, machineries and ali other working
tools utilized by private respondents in carrying
out their tasks were owned and provided by
SMC. In addition, the shrimp processing
company was found to have control of the
manner and method on how the work was
done. Thus, the complainants were deemed
Ees not of the cooperative but of the shrimp
processing company. Since respondents who
were engaged in shrimp processing performed
tasks usually necessary or desirable in the
aquaculture business of SMC, they should be
deemed regular Ees of the latter and as such
are entitled to ali the benefits and rights
appurtenant to regular employment. (SMC vs.
Prospero Aballa, et a/., G.R. No. 149011, June
28, 2005, J. Carpio-Morales)
Q: What are the conditions before
permitting job contracting?
A:
1. The labor contractor must be duly
licensed by the appropriate Regional
Office of the DOLE
2. There should be a written contract
between the labor contractor and his
client-Er that will assure the Ees at
least the minimum labor standards
and benefits provided by existing
laws.
Note: The Ees of the contractor or subcontractor
shall be paid in accordance with the provisions of
the tc.(Art. 106)
Q: What is labor-only contracting?
A: It refers to an arrangement where the
foliowing conditions concur:
1. The person supplying workers to an
Er does not have substantial capital
or investment in the form of tools,
equipment, machineries, work,
premises, among others, or
2. Even if such person has substantial
assets, the same are not actualiy or
directly used by the Ees contracted
out;
3. The workers recruited and placed by
such person are performing activities
which are directly related to the
principal business of such Er.
Q: Why is labor only contracting
prohibited?
A: It gives rise to confusion as to who is the
real Er of the workers and who is liable to their
claims. It also deprives workers of the
opportunity to become regular Ees.
Q: How do we determine if one is engaged
in labor/job only contracting?
A: The test to determine whether one is a
job/labor only contracting is to look into the
elements of a job contractor. If ali the elements
of a job contractor are present, then he is a job
.contractor, Absent one of the elements for a
job contractor, then the person is a labor-only
contractor.
Q: Distinguish between job contracting
and labor only contracting
A:
J OB CONTRACTING
LABOR-ONLY
CONTRACTING
Liability is limited (shall
be solidarily liable with
Liability extends to all
Er only when the Er
those provided under
fails to comply with
the Labor Standards
req'ts as to unpaid
law
wages and other labor
standards violations)
Permissible, subject
only to certain
Prohibited by Law
conditions
The contractor has
Has nosubstantial
substantial capital or
capital or investment
investment
Q: Metro Grocery Inc. arranged with Dado, a
Barangay Chairman, to provide the grocery
with workers who 'will work as cashiers, bag
boys, shelf-counter helpers and
sanitation workers. The grocery will pay
Dado an amount equivalent to the direct
and hidden costs of the wages of each
worker assigned, plus 10% to cover the
administrative costs related to their
arrangement. Dado, in turn, will pay directly
the workers their wages. As far as the
workers are concerned, Dado is their Er. A
group of concerned workers consulted you
if Dado is really under the law their Er. (2000
Bar Question)
1. How will you analyze the problem in
order to formulate your answer?
2. What is the legal significance, if any,
the
question of concerned workers as to
who is their Er?
A: I will apply the four- fold test of Er-Ee
relationship. I will examine if Dado exercises
power of control or supervision over the
workers' manner and method of doing their
work. Control is the most important factor in
examining Er-Ee relationship. The other factors
are hiring, payment of wages, and power to
dismiss, I will also examine whether there was
job contracting or labor-only contracting.
iJ ..
Q: SMPC entered into a contract with
Arnold for the milling of lumber as well as
the hauling of waste wood products. The
company provided the equipment and tools
because Arnold had neither tools and
equipment nor capital for the job. Arnold,
on the other hand, hired his friends,
relatives and neighbors for the job. Their
wages were paid by SMPC to Arnold, based
on their production or the number of
workers and the time used in certain areas
of work. All work activities and schedules
were fixed by the company.
1. Is Arnold a job contractor? Explain
briefly
2. Who is liable for the claims of the
workers hired by Arnold? Explain briefly.
A:
1. No. In the problem given, Arnold did
not have sufficient capital or
investment for one. For another,
Arnold was not free from the control
and direction of SMPC because all
work activities and schedules were
fixed by the company. Therefore,
Arnold is not a job contractor. He is
engaged in labor-only contracting.
2. SMPC is liable for the claims of the
workers hired by Arnold. A finding
that Arnold is a labor only contractor
is equivalent to declaring that there
exist an Er-Ee relationship between
SMPC and workers hired by Arnold.
This is so because Arnold is
considered a mere agent of SMPC
(Lim v. NLRC, G.R. No. 12463G, Feb.
19, 1999); 2002 Bar Question)
Q: What are the grounds for delisting of
contractors or subcontractors?
A:
1. Non-submission of contracts between
the principal and the contractor or
subcontractor when required to do so;
2. Non-submission of annual report;
3. Findings through arbitration that the
contractor or subcontractor has
engaged in labor-only contracting and
other prohibited activities;
4. Non-compliance with labor standards
and working conditions. (Sec. 16,
D.O. 18-02)
~. ART. 107. INDIRECT-EMPLOYER
Q: Who is an indirect Er?
A: The provisions of Art. 106 shall likewise
apply to any person, partnership, association
or corporation which, not being an employer
(Er), contracts with an independent contractor
for the performance of any work, task, job or
project. (Art. 107)
Note: The Er or indirect Er may require the
contractor or subcontractor to furnish a bond to
the cost of labor under the contract conditionedto
answer for the wages due the Ees should the
latterfail to paythe same. (Art. 108)
Q: What is the liability of an indirect Er?
A: Every Er or indirect Er shall be held
responsible with his contractor or
subcontractor for any violation of the
provisions of the LC.
For purposes of determining their civil liability,
every Er or indirect Er shall be considered as
direct Ers. (Art. 109, LC)
Q: CMI had provided janitorial services to
the NEDA since April '88. Its service
contract was renewed every three months.
However, in the bidding held on J uly 1992,
CMI was disqualified and excluded. In '93,
G janitors of CMI formerly assigned at
NEDA filed a complaint for underpayment
of wages. Both CMI and NEDA were
impleaded as respondents for failure to
comply with NCR Wage Orders Nos. 01
and 02, which took effect on Nov. 1, '90
and J an. 2, '92, respectively.
Should NEDA, a gov't agency subject to
budgetary constraints, be held solidarily
liable with CMI for the payment of salary
differentials due the complainants?
A: NEDA shall be held solidarily liable with
CMI for the payment of salary differentials due
to the complainants, because NEDA is the
indirect Er of said complainants. The LC
provides that xxx A person, partnership,
association or corporation which, not being an
Er, contracts with an independent contractor
for the performance of any work, task, job or
project" xxx "shall be jointly and severally
liabie with his contractor or subcontractor to
UNiVERSITY OF SANTO TOMAS I ,~~ 6'"
Pacu{ tal de Ver ecfi o Ci vi C.' ~
such Ees (of the contractor or subcontractor)
to the extent of work performed under the
contract xxx." (Arts. 106 and 107, LC) (2004
Bar Question)
Q: Can the Er require a bond?
A: An Er or indirect Er may require the
contractor or subcontractor to furnish a bond
equal to the cost of labor under contract, on
condition that the bond will answer for the
wages due the employees (Ees) should the
contractor or subcontractor, as the case may
be, fail to pay the same.
Where the Er fails to require the contractor or
subcontractor to post a bond, the Er must
answer for whatever liabilities the contractor
may have incurred to his Ees. This is without
prejudice to its seeking reimbursement from
the contractor for whatever amount it will have
to pay the said Ees. (Baguio v. NLRC, G.R.
Nos. 79004-08, Oct. 4, 1991)
: ART. 110-. WORKER PREFERENCE
IN CASE OF BANKRUPTCY
Q: What happens if the Er business
experiences bankruptcy or liquidation?
A: His workers shall enjoy first preference as
regards their wages and monetary claims, any
provrsion of the law to the contrary
notwithstanding.
Q: What are the principles underlying the
preference?
A:
1. Declaration of bankruptcy or judicial
liquidation before enforcement of the
worker's preferential right
2. Filing of claims by workers.
3. The right does not constitute a lien to
the property of the insolvent debtor in
favor of workers. (DBP VS. NLRC,
G.R. No. 82763 Mar. 19, 1990 and
G.R. No. 97176, Mar. 18, 1993)
4. The preference in favor of the Ees
applies to discharge of funds. The
preference does not only cover
unpaid wages, it also extends to
. termination pay and other monetary
claims.
Note: Termination pay, after all, is
considered as additional remuneration
for services rendered to the employer
for a certain period of time; it is
computed on the basis of length of
service. (PNB vs. Cruz, G.R. No.
80593, Dec. 18, 1989)
5. Applicable only to ordinary preferred
credit, hence, must yield to special
preferred credits.
Q: Are workers preferred than the tax
claims of the Gov't?
A: No. Art. 110 did not sweep away the
overriding preference accorded under the
scheme of the Civil Code to tax claims of the
gov't.
Q: Is worker preference applicable if the Er-
corporation is under rehabilitation?
A: No. Suspension of payments order by the
SEC mandates the holding in abeyance the
filing or the proceedings on labor cases
against an Er who is under rehabilitation to
give the Er the chance to concentrate on how
to revive his business and not be distracted in
trying to defend itself in labor cases filed
against it. (Rubberworld, Inc. v. NLRC, G.R.
No. 126773, April 14, 1999)
Q: Premiere Bank, being the creditor-
mortgagee of XYZ & Co., a garment firm,
foreclosed the hypothecated assets of the
latter. Despite the foreclosure, XYZ & Co.
continued its business operations. A year
later, the bank took possession of the
foreclosed property. The garment firm's
business operations ceased without a
declaration of bankruptcy. Caspar, an
employee of XYZ & Co., was dismissed
from employment due to the cessation of
business of the firm. He filed a complaint
against XYZ & Co. and the bank. The Labor
Arbiter, after hearing, so found the
company liable, as claimed by Caspar, for
separation pay. Premiere Bank was
additionally found subsidiarily liable upon
the thesis that the satisfaction of labor
benefits due to the Ee is superior to the
right of a mortgagee of property. Was the
Labor Arbiter correct in his decision?
A: No. The preference of credits established in
Art. 110 of the LC cannot be invoked in the
absence of any insolvency proceedings,
declaration of bankruptcy, or judicial
liquidation. (DBP v. Santos, G.R. No. 75801,
March 20, 1991). (2003 Bar Question)
Q: Distinguish the mortgage created under
the Civil Code from the right of 1st
preference created by the LC as regards
e unpaid wages of workers. Explain.
A: A mortgage directly subjects the property
.ipon which it is imposed, whoever the
oossessor may be, to the fulfillment of the
bligation for which it was constituted. It
ceates a real right which is enforceable
against the whole world. It is therefore a lien
an identified real property. .,
'{I ,
Aortgage credit is a special preferred credit
.rider the Civil Code in the classification of
edits. The preference given by the lC when
I' t attached to any specific property, is an
dinary preferred credit. (1995 Bar Question)
ART. 111.ATTORNEY'S FEES
Q: What are the limitations to the
assessment of attorney's lien against the
culpable party?
A:
1. In case of unlawful withholding of
wages - 10% of the amount of wages
to be recovered.
2. It shall be unlawful for any person to
demand or accept, in any judicial or
administrative proceedings for the
recovery of wages, atty's fees that
exceed 10% of the amount of wages
recovered.
ote: The prohibition on atty's lien refers to
oceedings for recovery of wages and not to
services rendered in connection with CBA
~egotiations. In the latter case, the amount of
arty's fees may be agreed upon by the parties
a d the same is to be charged against union
. ds as provided for in Art. 222 of the Labor
Code, (Pacific Banking Corp.v. Clave, GR. No.
- 965, Mar. 7, 1984)
Q: What is ordinary attorney's fee?
A: It is the reasonable compensation paid to a
awyer by his client for the legal services he
as rendered.
Q: What is extraordinary attorney's fee?
A: It is the indemnity for damages ordered by
e court to be paid by the losing party in a
r 'gation and is not to be paid to the lawyer but
t the client, unless they have agreed that the
award shall pertain to the lawyer as an
additional compensation or as a part thereof.
(Traders Royal Bank Ee's Union-Independent
v. NLRC, GR. No. 120592, Mar. 14, 1997)
Note: Art.111 of the LC deals with the
extraordinary concept of attorney's fees. It may
not be used as the standard in fixing the amount
payable to the lawyer by his client for the legal
services he rendered. (Masmud v. NLRC, GR.
No. 18338~ Feb. 13, 2009)
Q: Santiago, a project worker, was being
assigned by his Er, Bagsak Builders, to
Laoag, !locos Norte. Santiago refused to
comply with the transfer claiming that it, in
effect, constituted a constructive dismissal
because it would take him away from his
family and his usual work aSSignments in
Metro Manila. The Labor Arbiter (LA) found
that there was no constructive dismissal
but ordered the payment of separation pay
due to strained relations between Santiago
and Bagsak Builders plus atty's fees
equivalent to 10% of the value of Santiago's
separation pay.
Is the award of atty's fees valid? State the
reasons for your answer.
A: No, the award of atty's fees is not valid.
According to the lC (Art. 111 [a]), atty's fees
may be assessed in cases of unlawful
withholding of wages which does not exist in
the case. The worker refused to comply with a
lawful transfer order, and hence, a refusal to
work. Given this fact, there can be no basis for
the payment of atty's fees.
Could the LA have validly awarded moral
and exemplary damages to Santiago
instead of atty's fees? Why?
A: No, moral and exemplary damages can be
awarded only if the worker was illegally
terminated in an arbitrary or capricious
manner. (Nueva Ecija Electric Cooperative
inc., Ees' Ass'n., vs. NLRC, GR No. 116066,
Jan. 24, 2000; Cruz VS. NLRC, GR. No.
116384, Feb. 7, 2000; Phil. Aeolus etc., VS.
NLRC, GR. No. 124617, April 28, 2000).
(2001 Bar Question)
Q: When can attorney's fees and damages
be awarded in an illegal dismissal case?
A: For attorney's fees, moral and exemplary
damages to be granted, the plaintiff must
prove that the facts of his case fall within the
enumerated instances in the Civil Code.
Thus, moral damages may only be recovered
where the dismissal or suspension of the
employee was attended by bad faith or fraud,
or constituted an act oppressive to labor, or
UNIVERSITY OF SANTO TOMAS (:;J 65
Pacu[ taa ae ! l Jer echo Ci vi C ..
LABOR STANDARDS
was done in a manner contrary to morals,
good customs or public policy. In other
words, the act must be a conscious and
intentional design to do a wrongful act for a
dishonest purpose or some moral obliquity.
Exemplary damages, on the other hand, may
only be awarded where the act of dismissal
was effected in a wanton, oppressive or
malevolent manner. (Chaves v. NLRC,G.R.
No. 166382, June 27, 2006)
Q: What is union service fee?
A: The appearance of labor federations and
local unions as counsel in labor proceedings
has been given legal sanction under Art. 222
of the LC, which allows non-lawyers to
represent their organization thereof. The said
labor federations and local unions have a valid
claim to atty's fees which is called the Union
Service Fee.
66
c
Academics Committee
Chai r per son: Abraham D. Genuine II
Vi ce-Chai r for L EgOI I ! &Desi gn: Loise Rae G.Naval
Labor Law Committee
S l I o/eci H ead' Lester J ay AlanE.FloresII
Assi stant Sl I o/eet H ead' Domingo B, Diviva V
Members:
. Diane Camilla R.Borja
ChristianNiii.oA, Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelle C.Lee
J emuel PaoloM, Lobo
Andrew \'1/.Montesa
Mana Maica Angelika Roman
:. CHAPTER IV
. PROHIBITIONS REGARDING WAGES
'., ART. 112. NON-INTERFERENCE
:, -- -IN-DISPOSAL OF WAGES
Q: What is the rule on non-interference or
disposal of wages?
A: No employer (Er) shall:
1. Limit or otherwise interfere with the
freedom of any Ee to dispose. of his
wages
2. Force, compel, or oblige his Ees to
purchase merchandise, commodities
or other property from any person, or
otherwise make use of any store, or
service of such Er or any other
person
. ART. 113.WAGE DEDUCTIONS
Q: What Is the rule in wage deductions?
A:
GR: It is strictly prohibited
XPN:
1. Deductions under Art. 113 for
insurance premiums
2. Union dues in cases where the right
of the worker or his union to check off
has been recognized by the employer
(Er) or authorized in writing by the
individual worker concerned (Art
113). Art. 241 (0) provides that special
assessments may be validly checked-
off provided that there is an individual
written authorization duly signed by
every employee (Ee).
3. Deductions for SSS, Medicare and
Pag-ibig premiums
4. Taxes withheld pursuant to the Tax
Code
5. Deductions under Art. 114 for loss or
damage to tools, materials or
equipments
6. Deductions made with the written
authorization of the Ee for payment to
a third person. (Sec 13, Rule VIII,
Book 11/of the IRR)
7. Deductions as disciplinary measures
for habitual tardiness (Opinion dated
March 10, 1975 ofthe SLE).
8. Agency fees under Art. 248(e)
9. Deductions for value of meals and
facilities freely agreed upon
10. In case where the Ee is indebted to
the Er where such indebtedness has
become due and demandable. (Art.
1706, Civil Code)
11. In court awards, wages may be
subject of execution or attachment,
but only for debts incurred for food,
shelter, . clothing, and medical
attendance. (Art. 1703, Civil Code)
12. Salary deduction of a member of a
legally established cooperative. (R.A
6938, Art. 59)
Q: An explosion in a mine site resulted in
the death of 50 miners. At the time of the
accident
(1) the mining company has not yet paid
the wages, OT, holiday and rest day
compensation of the deceased miners;
(2) all the deceased miners owed the
miners Cooperative Union sums of money;
(3) the mining company was served by a
sheriff writs of garnishment of wages of
some of the deceased miners by virtue of
final J udgments in several collection suits.
After the accident, the wives, paramours,
brothers, sisters and parents of the
deceased miners filed their claims for
unpaid wages, OT, holiday and rest day
compensation. The company has
acknowledged its obligations. However, it
is in a quandary as to how to adjudicate the
conflicting claims; and whether it can
deduct from the monies due the miners
their unpaid debts with the credit union.
How will you advise the mining company
on the ff:
1) Can the mining company defer
payment of the money claims until
an appropriate court has ruled on
the conflicting claims?
2) Can the mining company deduct
from the amount due to each miner
an amount equivalent to their debt
and remit the same to the credit
union?
A:
1. I will advise the mining company to
pay to the respective heirs of the
deceased miners whatever the
unpaid wages were, OT, holiday and
rest day compensation of said
deceased miners without the
necessity of intestate' proceedings.
The claimants, if they are all of age
shall 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. If any
of the heirs is a minor, the affidavit
shall be executed on his behalf by his
natural guardian or next of kin. The
affidavit shall be presented to the
UNIVERSITY OF .sANTO TOMAS ~~; 67
Pacu{ tad d (] )er ecno Ci vi t .
employer who shall make payment
through the Secretary of Labor (SLE)
or his representative. The
representative of the SLE shall act as
referee in dividing the amount paid
among the heirs. (Art. 105 (b), LC)
2. I will advise the mining company not
to deduct from the amount due to
each miner the amount equivalent to
his debt to the credit uuion. The debts
of a deceased worker to the credit
union is not one of the allowable
deductions under the Labor Code
(LC), or any rules and regulations of
the DOLE. (Art. 113, LC) (1998 Bar
Question)
Q: What is the rule in check-off?
A: An Er may be compelled to check-off union
dues from the wages of his Ee when it has
been authorized to do so by the Ee. This is
upon the theory that it is necessary to promote
the welfare and integrity of the union to which
he belongs. It is a forward step to promote
social justice as envisaged by our Constitution.
(Manila Trading and Supply Co. v. Manila
Trading Labor Ass'n, G.R. No. L-5062, April
29, 1953)
ART. 114. DEPOSIT FOR LOSS OR' .
1 DAMAGES .
Q: Are Ers mandated to require his Ee to
make deposits for loss or damages to
materials of the former?
A:
GR: No Er shall require his worker to make
deposits for the reimbursement of loss or
damage to material, equipment, or tools
supplied by the Er.
XPN: When the trade, occupation or
business of the Er recognizes, or considers
the practice of making deductions or
requiring deposits necessary or desirable.
However, the same does not apply to or
permit deposits to defray any deficiency
which a taxi driver may incur in the
remittance of his boundary. (Five J Taxi v.
NLRC, G.R.No. 111474, Aug. 22, 1994)
. ARTS.116-119
Q: What are considered unlawful acts?
A:
1. Withholding of any amount, by any
person, indirectly or directly, from the
wage of a worker or induce the
worker to give up any part of his
wages by force, stealth, intimidation,
thereat or by any other means
whatsoever without the worker's
consent. (Art. 116)
2. Make any deductions from the wages
of any Ee for the benefit of the Er or
his representative or intermediary as
consideration of a promise or
employment or retention in
employment. (Art 117)
3. Refusal of an Er to payor reduce the
wages and benefits, discharge or in
any manner discriminate against any
employee who has filed any
complaint or instituted any
proceeding under this title or has
testified or is about to testify in such
proceedings. (Art. 118)
4. For any person to make any
statement, report or record filed or
kept pursuant to the provisions of the
LC Knowing such statement, report or
record to be false in any material
aspect. (Art. 119)
\ ART. 125. FREEDOM TO BARGAIN
Q: Is the worker free to bargain as regards
wages?
A: The question of minimum wage is beyond
the sphere of bargaining of the parties. It is not
negotiable. Under R.A. 6727, what the law
prohibits is bargaining for wages below the
floor set by law or Wage Order. The worker is
free to bargain for higher wages.
. ART. 12S.PROHIBITION AGAINST
. INJ UNCTION
Q: Does injunction
NWPC/RlWPB.
lie against
A: No..Proceedings of the National Wages and
Productivity Commission or the RTWPB are
beyond the reach of the injunction powers of
judicial or quasi-judicial bodies.
Q: What is the purpose ~f prohibition
against injunction?
A: In order for the National Wages and
Productivity Commission or the RTWPB to
perform its powers and functions speedily
without regard to unnecessary interventions
that may tremendously affect the wage fixing
functions. (Poouiz, 2005)
Academics Committee
Vi ce-Chai r j or Academi cs: J eannie J\. Laurentino
Vi ce-Chai r j ar Admi n &F i nance: Aissa CelineH.Luna
Vi ce-Chai r j ar L ayout &DeSi gn: LoiseRae G.Naval
Labor Law Committee
Subj ect H ead' Lester J ay"\IanE.Flores II
Members:
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelle C.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
UN! V E R SIT Y 0 F SP. NToT 0 il: Po S ~Q~ 69
Pacu{ taa ae Der echo Ci vi l ' .' .
LABOR STANDARDS: SPECIAL GROUPS OF EMPLOYEES: WOMEN
f TITLE III
, WORKING CONDITIONS FOR SPECIAL
I GROUPS OF EMPLOYEES
! CHAPTER I .
\ EMPLOYMENT.OF WOMEN
Q: What is the coverage of this Title?
A:
GR: It covers all Er, whether operating for
profit or not including charitable, religious
and educational institutions. (Sec. 1, Rule
XII, Book III, IRR)
XPNs:
1. GOCCs
2. Ers of househelpers and those in
their personal service only insofar as
said workers are concerned
Q: What is night work prohibition with
regard to women workers?
A:
GR: No woman regardless of age shall be
employed or permitted to work, with or
without compensation in any:
1. Industrial undertaking or branch
thereof between 10pm and 6am of
the following day.
2. Commercial or non-industrial
undertaking or branch thereof, other
than agricultural, between midnight
and 6am of the following day
3. Agricultural undertaking at nighttime
unless she is given period of rest not
less than 9 consecutive hours.
XPNS:
1. Actual or impending emergencies
a. Caused by serious accident, fire,
flood, typhoon, earthquake,
epidemic, other disasters, or
calamity
b. To prevent loss of life or property
or
c. In case of force majeure or
d. Imminent danger to public safety
2. Urgent work
a. To be performed on machineries,
equipment or installations,
b. To avoid serious loss which the
Er
would otherwise suffer
70
3. Work is necessary to prevent serious
loss to perishable goods
4. Woman Ees
a. Holds a responsible position of
managerial or technical nature,
or
b. Has been engaged to provide
health
and welfare services
5. Nature of the work
a. Requires .the manual skill and
dexterity of women workers
and
b. The same cannot be performed
with
equal efficiency by male workers
6. Women Ees are immediate members
of the establishment or undertaking
7. In analogous cases exempted by the
SLE in appropriate regulations. (Art.
131)
Note: The operation of Call Contract Centers
which provides offshore case solutions to US
based clients who phone in to conduct product
inquiries and technical support, operating for
24/7, has been exempted from the prohibition
considering the inevitable time difference
between the US and the PhiIs. and the peak time
for its operation is between 8:00 pm to 10:00 am
Manila time, thereby making it necessary for 80%
of its Ees, including women, to work during
graveyard shift. (BWC-WHSD Opinion No. 491, s.
2003)
: ART. 132. FACILITIES' FOR WOMEN
- --------~---~-- -- ------- ~- --
Q: What are facilities for women?
A: SLE may require Ers to:
1. Provide seats which are proper for
women
2. Establish separate toilet rooms and
lavatories for men and women
3. Provide at least one dressing room
for women
4. Establish a nursery in the
establishment
5. Determine appropriate minimum age
and other standards for retirement or
termination of employment in special
occupations such as those of flight
attendants and the like
,- ART. 134. FAMILY PLANNING SERVICES
Q: .Are Ers mandated to provide family
planning services?
A: Ers who habitually employ more than 200
workers in any locality shall provide free
family-planning services to employees-
spouses which shall include, but not limited to,
the application or use of contraceptive pills and
intra-uterine devices. (Sec. 11, Rule XII, Book
II. IRR of the LC) Q
:' ARTS. 135 -137
Q: What are the unlawful acts against
women Ee?
A:
1. Discrimination with respect to the
solely on account of sex
a. Payment of lesser compensation
to a female Ee as against a male
Ee for work of equal-value
b. Favoring a male Ee with respect
to promotion, training
opportunities, study and
scholarship grants on account of
gender. (Art. 135)
c. Favoring a male applicant with
respect to hiring where the
particular job can equally be
handled by a woman
d. Favoring a male Ee over a
female Ee with respect to
dismissal of personnel.
2. Stipulating, whether as a condition for
employment or continuation of
employment:
a. That a woman Ee shall not get
married, or
b. That upon marriage, such
woman Ee shall be deemed
resigned or separated. (Art. 136)
Note: A woman worker may not be
dismissed on the ground of dishonesty
for having written "single" on the space
for civil status on the application sheet,
contrary to the fact that she was
married. (PT& T Co. v. NLRC, GR. No.
118978, May 23, 1997)
3. Dismissing, discriminating or
otherwise prejudice a woman Ee by
reason of her being married. (Art.
136)
4. Denying any woman Ee benefits
provided by law. (Art. 137)
5. Discharge any woman for the
purpose of preventing her from
enjoying any of the benefits provided
by law. (Art. 137)
6. Discharging such woman on account
of her pregnancy, or while on leave or
in confinement due to her pregnancy.
(Art. 137)
7. Discharging or refusing the admission
of such woman upon returning to her
work for fear that she may again be
pregnant. (Art. 137)
Note: Discrimination in any form from pre-
employment to post employment. including hiring,
promotion or assignment, based on the actual,
perceived or suspected HIV status of an
individual is unlawful. (Philippine AIDS Prevention
and Control Act of 1998, [R.A. 8504])
Under Sec. 2 of R.A. 9710 or the Magna Carta of
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.
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. 9710)
Q: Can an individual, the sole proprietor of
a business enterprise, be said to have
violated the Anti-Sexual Harassment Act of
1995 if he clearly discriminates against
women in the adoption of policy standards
for employment and promotions in the
enterprise? Explain.
A: When an employer (Er) discriminates
against women in the adoption of policy
standards for employment and promotion in
his enterprise, he is not guilty of sexual
harassment. Instead, the Er is guilty of
discrimination against women Ees which is
declared to be unlawful by the LC.
For an Er to commit sexual harassment, he -
as a person of authority, influence or moral
ascendancy should have demanded,
U NI V E R SIT Y 0 F SAN ToT 0 MAS (:) 71
PacuCtaa ae (] )er eChO Civif ' 9-
LABOR STANDARDS: SPECIAL GROUPS OF EMPLOYEES: WOMEN
requested or otherwise required a sexual favor
from his Ee whether the demand, request or
requirement for submission is accepted by the
object of said act. (2003 Bar Question)
Q: At any given time, approximately 90% of
the production workforce of a
semiconductor company are females. 75%
of the female workers are married and of
child-bearing years. It is imperative that the
Company must operate with a minimum
number of absences to meet strict delivery
schedules. In view of the very high number
of lost working hours due to absences for
family reasons and maternity leaves, the
company adopted a policy that it will
employ married women as production
workers only if they are at least 35 yrs of
age. Is the policy violative of any law?
A: Yes, it is violative of Art. 140 of the LC
which provides that no employer shall
discriminate against any person in respect to
terms and conditions of employment on
account of his age. (1998 Bar Question)
Q: What is the no-spouse employment
policy?
A:
B:
1. Policy banning spouses from working
in the same company.
2. May not facially violate Art. 136 of the
LC but it creates a disproportionate
effect and the only way it could pass
judicial scrutiny is by showing that it is
reasonable despite the discriminatory
albeit disproportionate effect.
XPN: Bona fide occupational qualification
rule (BFOQ)
Q: What Is the BFOQ rule?
A: There must be a finding of any BFOQ to
justify an Ers no spouse rule. There must be a
compelling business necessity for which no
alternative exist other than the discriminating
practice.
To justify a BFOQ the employer 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.
72
Simbol, G.R., No. 164774, April 12,
2006)
Q: What is the importance of the BFOQ
Rule?
A:
1. To ensure that the Ee can effectively
perform his work
2. So that the no-spouse rule will not
impose any danger to business.
Q: Tecson was employed by Glaxo as
medical representative who has a policy
against Ees having relatiOnships against
competitor's Ees. Tecson married Bettsy, a
Branch coordinator of Astra, Glaxo's
competitor. Tecson was transferred to
another area. Tecson did not accept such
transfer.
Is the policy of Glaxo valid and reasonable
so as to constitute the aet of Teeson as
willful disobedience?
A: The prohibition against personal or marital
relationships with Ees of competitors
companies upon Glaxo's Ees is reasonable
under the circumstances because
relationships of that nature might compromise
the interest of the company. Glaxo does not
impose an absolute prohibition against
relationships between its Ees and those of
competitor companies. Its Ees are free to
cultivate relationships with and marry persons
of their own choosing. What the company
merely seeks to avoid is a conflict of interest
between the Ee and the company that may
arise out of such relationships. Furthermore,
the prohibition forms part of the employment
contract and Tecson was aware of such
restrictions when he entered into a relationship
with Bettsy. (Duncan Asso. of Detailman-
PTGWO v. G/axo WeI/come Phil. Inc., G.R.
No. 162994, Sep.17, 2004),
. ART. 138.CLASSIFICATION OF CERTAIN ,
r - WOMEN WORKERS
Q: Who are covered under this Title?
A: Any women who is permitted or suffered to
work:
1.
2.
3.
With or without compensation
In any night club, cocktail lounge,
massage clinic, bar or similar
establishment
Under the effective control or
supervision of the Er for a substantial
period of time
Shall be considered as an Ee of such
establishment for purposes of labor
and social legislation.
4.
A:
GR:
1. No person under 18 years of age will
be allowed to be employed in an
undertaking which is hazardous or
deleterious in nature. .
2. No Er shall discriminate against any
person in respect to terms and
conditions of employment on account
of his age.
XPN:
A. Below 15yrs. Old
1. The child works directly under
the sole responsibility of his
parents, or guardians who
employ members of his family,
subject to the following
conditions:
a. Employment does not
endanger the child's safety,
health and morals
b. Employment does not impair
the child's normal dev't
c. Er-parent or legal guardian
provides the child with the
primary and/or secondary
education prescribed by the.
Dept. of Education
2. The child's employment or
participation in public
entertainment or information
through cinema, theater, radio or
television is essential provided:
a. Employment contract is
concluded by the child's
parents or legal guardian,
b. With the express agreement
of the child concerned, if
possible, and
c. The approval of DOLE, the
following must be complied
with:
i. The employment does not
involve advertisement or
commercials promoting
alcoholic beverages,
intoxicating drinks,
tobacco and its by-
products or exhibiting
violence
ii. there is a written contract
approved by DOLE
iii. the conditions provided in
the first instance are met.
;' -CHAPTER II
; EMPLOYMENT OF MINORS
~:., ART. 139. MINIMUM EMPLOYABLE AGE
Q: What are the general prohibitions?
B. Above 15 but below 18 - may be
employed in any non-hazardous work
C. Above 18 - no prohibition
Q; What is the duty of the Er before
engaging child into work?
A: The Er shall first secure a work permit from
the DOLE which shall ensure observance of
the requirements. (Sec. 12, R.A. 7160)
Q: What is the rule regarding the issuance
of work certificatesl permits for children at
least 15 but below 18 years of age?
A: The issuance of a DOLE Certificate to
youth aged 15 to'"below 18 years of age is not
required by law. No employer shall deny
opportunity to any such youth applying for
employment merely on the basis of lack of
work permit or certificate of eligibility for
employment. Any young person aged 15 to
below 18 years of age may present copy of
this DOLE advisory to any employer, job
provider, government authority, or his/her
representative when seeking employment or
anytime during employment. (DOLE
Department AdviSOry No. 01-08)
Q: What is a non-hazardous work?
A: It is any work or activity in which the Ee is
not exposed to any risk which constitutes an
imminent danger to his safety and health.
Q: What are hazardous workplaces?
A:
1. Nature of work exposes the workers to
dangerous environmental elements,
contaminants or work conditions;
2. Workers are engaged in construction
work, logging, fire-fighting, mining,
quarrying, blasting, stevedoring, dock
work, deep-sea fishing, and mechanized
farming;
3. Workers are engaged in the
manufacture or handling of explosives and
other pyrotechnic products;
4. Workers use or are exposed to heavy
or power-driven tools.
PacuCtaa de < Der ec/i o Ci vi C
LABOR STANDARDS: SPECIAL GROUPS OF EMPLOYEES: MINORS
Q: You were asked by a paint
manufacturing company regarding the
possible employment as a mixer of a
person, agQd 17, who shall be directly
under the care of the section supervisor.
What advice would you give? Explain
briefly.
A: I will advise the paint manufacturing
company that it cannot hire a person who is
aged 17. Art 139 (c) of the LC provides that a
person below 18 yrs of age shall not be
allowed to work in an undertaking which is
hazardous or deleterious in nature as
determined by the SLE. Paint manufacturing
has been classified by the SLE as a hazardous
work. (2002 Bar Question)
Q: What are the prohibitions on the
employment of children in certain
advertisements?
A: No employment of child models in all
commercial advertisements promoting:
1. Violence
2. Alcoholic beverages
3. Intoxicating drinks
4. Tobacco and its by products
Q: What are the pertinent provisions of the
Child and Youth Welfare Code (P.O. 603)?
A:
1. Art. 107 - Children below 16 years of
age may be employed to perform light
work which is not harmful to their
safety, health or normal development
and which is not prejudicial to their
studies.
2. Art. 108 - The Er shall submit to
DOLE a report of all children
employed by him.
3. Art. 109 - Every Er in any
commercial, industrial or agricultural
establishment or enterprise shall
keep:
a. A register of all children
employed by him, indicating
dates of their birth
b. A separate file for the written
consent to their employment
given by their parents
c. A separate file for their
educational and medical
certificates
d. A separate file for special work
permits issued by the SLE in
accordance with existing laws.
4. Art. 110 - If a domestic helper is
under 16 years of age, the head of
the family shall give him an
opportunity to complete at least
elementary education as required
under Art. 71.
Q: What are the provisions under the RPC
on child labor?
A:
1. Art. 273 - Exploitation of Child labor
2. Art. 278 - Exploitation of Minors
Q: A spinster school teacher took pity on
one of her pupils, a robust and precocious
12-year old boy whose poor family could
barely afford the cost of his schooling. She
lives alone at her house near the school
after her housemaid left. In the afternoon,
she lets the boy do various chores as
cleaning, fetching water and all kinds of
errands after school hours. She gives him
rice and P30.00 before the boy goes home
at 7:00 every night. The school principal
learned about it and charged her with
violating the law which prohibits the
employment of children below 15 years of
age. In her defense, the teacher stated that
the work performed by her pupil is not
hazardous, and she invoked the exception
provided in the Department Order of DOLE
for the engagement of persons in domestic
and household service. Is her defense
tenable? Reason?
A: No, her defense is not tenable. Under Art.
139 of the LC on "minimum employable age",
no child below 15 years of age shall be
employed except when he works directly under
the sole responsibility of his parents or
guardian, the provisions of the alleged DO of
DOLE to the contrary notwithstanding. A mere
DO cannot prevail over the-express prohibitory
provisions of the LC. (2004 Bar Question)
Q: Determine whether the following minors
should be prohibited from being hired and
from performing their respective duties
indicated hereunder:
1. A 17-year old boy working as miner at
the Walwadi Mining Corporation.
A: Yes, he should be prohibited from being
hired and from performing the duties of a
miner because such constitutes hazardous
work under D.O. No. 04 Series of 1999. Art.
139 (c) of LC expressly prohibits the
employment of persons below 18 years of age
in an undertaking which is hazardous or
deleterious in nature as determined by the
SLE.
2. An 11-year old boy who is an
accomplished singer and performer in
different parts of the country.
A: No, he should not be prohibitedfrom being
hired and from performing as a singer. Under
Art. VIII Sec. 12 par. 2 of R.A. 7619 as
amended by R.A. 7658, this constitutes an
exceptiontothe general prohibitionagainstthe
employment of children below15years of age,
provided that the following requirements are
strictlycompliedwith: ,1,
1. The Er shall ensure the protection,
health safety and morals of the child
2. 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; and
3. The Er shall formulate and
implement, subject to the approval
and supervision of competent
authorities, a continuing programfor
training and skill acquisition of the
child. Moreover, the cfiild must be
directly under the sole responsibility
of his parents or guardian and his
employment should not in any way
interfere with his schooling.
3. A 15-year old girl working as a library
assistant in a girls' high school.
A: No, she should not be prohibited from
working as a library assistant because the
prohibition in the LC against employment of
persons below 18years of age merely pertains
to employment in an undertaking which is
hazardous or deleterious innatureas identified
inthe guidelines issued by the SLE working as
a library assistant is not one of undertakings
identified to be hazardous under D.O. No 04
Series of 1999.
4. A 16-year old girl working as model
promoting alcoholic beverages.
A: Yes, she should be prohibitedfromworking
as a model promoting alcoholic beverages.
R.A. 7610 categorically prohibits the
employment of child models in all commercials
or advertisements promoting alcoholic
beverages and intoxicating drinks, among
otherthings.
5. A 17-year old boy working as a dealer in
a casino.
A: Yes, he should be prohibited from working
as a dealer in casino, because Art. 140 of the
LC prohibits the employment of persons below
18 years of age in an undertaking which is
hazardous or deleterious in natureidentifiedin
the guidelines issued by the SLE. Working as
a dealer in a casino is classified as hazardous
under D.O. No. 04 Series of 1999 as it
exposes children to physical, psychological or
sexual abuses. (2006 Bar Question)
Academics Committee
Chai r per son: ;\braham D.Genuino II
Vi ce-Chai r for L ayout &Desi gn: LoiseRaeG.Naval
Labor LawCommittee
Subj ect H ead' Lester J ay AlanE.FloresII
Members:
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelleC.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
PacuCtaa ae l Der ecfi o Ci vi C
LABOR STANDARDS: SPECIAL GROUPS OF EMPLOYEES: HOUSEHELPERS
CHAPTER III
EMPLOYMENT OF HOUSEHELPERS
, ----;---------ARTS-:--f41-=1S2.- - ------ ~~;-.
Q: What
service?
is domestic or household
A:
1. Services in the Ers home
2. Usually necessary or desirable
3. For the maintenance and
employment thereof
4. Includes ministering to the personal
comfort and convenience of the
members of the Ers household
5. Including services of family drivers.
Q: Who is a househelper (HH)?
A: A HH is synonymous to domestic servant
1. Any person, male or female
2. Who renders services in and about the
Ers
home and
3. Services are usually necessary or
Desirable for the maintenance and
enjoyment thereof, and
4. Ministers exclusively to the personal
comfort and enjoyment of Ers family
Note: The children and relatives of a HH who live
under the Ers roof and who share the
accommodations provided for the HH by the Er
shall not be deemed as HH's if they are not
otherwise engaged as such and are not required
to perform any substantial household work. (Sec
3, Rule XII, Book III, IRR)
The definition of a HH cannot be interpreted to
include househelp or laundry women working in
staffhouses of a company. (APEX Mining CO.,
Inc., v. NLRC, GR. No. 94951, April 22, 1991)
Q: What are the rights of HHs?
A:
1. Original contract of domestic service
shall not last for more than 2 years
but it may be renewed by the parties.
(Art. 142)
2. Entitled to minimum wage in addition
to lodging, food, and medical
attendance. (Art. 144)
3. Employment contract should be
reviewed every 3 years with the end
view of improving the terms and
conditions of employment. (Art. 143)
4. SSS benefits for those who are
receiving at least Pi ,000 per month.
(Art. 143)
76
5. Non-assignment to a work in a
commercial, industrial or agricultural
enterprise at a wage or salary rate
lower than that provided for
agricultural or non-agricuitural
workers. (Art. 145)
6. Ees under 18 years of age shall be
given opportunity for at least
elementary education. The cost of
education shall be part of the HH's
compensation, unless otherwise
stipulated. (Art 146)
7. Should be treated in a just and
humane manner. (Art. 147)
8. Not to be treated with physical
. violence (Art. 147)
9. Suitable and sanitary living
headquarters as well as adequate
food and medical attendance. (Art.
148)
10. Termination of employment should be
a. upon expiration of term of
employment, or
b. based on just cause (Art. 149)
11. Indemnity for unjust termination of
service
12. Employment certification as to nature
and duration of service and efficiency
and conduct of househelper.
Q: What is the minimum wage for HHs?
A:
1. P800 a month for HHs in Metro Manila.
2. P650 a month for HHs in other
chartered cities or first class
3. P550 a month for HHs in other
municipalities.
Note: The minimum cash wage rates shall be
paid to the HHs in addition to lodging, food and
medical attendance.
Q;Is there an OT Pay for HHs?
A: No. The LC is silent on the grant of OT pay,
HP, Premium Pay and SIL to those engaged in
the domestic or household service. Moreover
Art. 82 of LC expressly excludes domestic
helpers from its coverage. (Ultra Villa Food
Haus v. Geniston, G.R. No. 120473, June 23,
1999)
Q: Erlinda worked as a cook, preparing the
lunch and merienda of the Ees of
Remington Industrial Sales Corp. She
worked at the premises of the company.
When Erlinda filed an illegal dismissal
case, Mr. Tan, the managing director of
Remington Corp. claimed that Erlinda was
a domestic helper, and not a regular Ee of
Remington Corp. Mr. Tan argued that it is
only when the househelper or domestic
servant is assigned to certain aspects of
the business of the Er ~hat ~such
househelper or domestic servant may be
considered as such an employee. Is Erlinda
a domestic or househelper?
A: No, Erlinda is clearly not a househelper. A
"househelper" or "domestic servant" underthe
Implementing Rules of the LC is one who is
employed in the Er's home to minister
exclusively to the personal comfort and
enjoyment of the Er's family. A househelper,
domestic servant or laundrywoman in a home
or in a company staffhouse is different in the
sense that in a corporation or a single
proprietorship engaged in business or industry
or any agricultural or similar pursuit, service is
being rendered in the staffhouses or within the
premises of the business of the Er. In such
instance, they are Ees of the companyor Erin
the business concerned, entitled to the
privileges of a regular Ee. The mere fact that
the househelper or domestic servant is
working within the premises of the business of
the employer and in relationtoor in'connection
with its business, as in its staffhouses for its
guest or evenfor its officers and Ees, warrants
the conclusion that such househelper or
domestic servant is and should be considered
a regular Ee and not a househelper.
(Remington Industrial v. Castaneda, G.R. Nos.
169295-96, Nov.20, 2006)
Q: NBC has a resthouse and recreational
facility in the highlands of Tagaytay City for
the use of its top executives and corporate
clients. The resthouse staft includes a
caretaker, two cooks and a laundrywoman.
All of them are reported to the SSS as
domestic or household Ees of the
resthouse and recreational facility and not
of NBC. Can NBC legally consider the
caretaker, cooks and laundrywoman as
domestic Ee's of the resthouse and not of
NBC?
A: No, they are not domestic Ees. They are
NBC's Ees because the resthouse and
recreational facility are business facilities as
they are for use of the top executives and
clients of NBC.(Traders Royal Bank v. NLRC,
G.R. No. 127864, Dec. 22. 1999), (2000 Bar
Question)
ART. 149. INDEMNITY FOR UNJ UST
TERMINATION OF SERVICE .
Q: What are the rules for indemnity?
A:
1. If the period for household service is
fixed, neither the Er nor the
househelper may terminate the
contract before the expiration' of the
termexceptfor just cause.
2. If the househelper is unjustly
dismissed, he or she shall be paidthe
compensation already earned plus
that for the 15 days by way of
indemnity.
3. If the househelper leaves without
justifiable reason, he or she shall
forfeit any unpaid salary due himor
her not exceeding 15days.
Q: When can the HH demand for
employment certification?
A: Upon the severance of the household
service relationship, the househelper may
demand fromthe Er a written statement of the
nature and duration of the service and his/ her
efficiency andconduct as househelper.
Pacu(taa ae (] )er ecl i o Ci vi C
LABOR STANDARDS: SPECIAL GROUPS OF EMPLOYEES: HOME WORKERS
I ART. 153. REGULATION OF INDUSTRIAL
HOMEWORKERS
")
,
;: Q: Who are homeworkers (HW)?
A: They are those who perform in or about his
own home any processing or fabrication of
goods or materials, in whole or in part, which
have been furnished directly or indirectly, by
an Er and sold thereafter to the latter.
Q: Who is the Er of HW?
A: Includes any person, natural or artificial
who, for his account or benefit, or on behalf of
any person residing outside the country,
directly or indirectly, or through an Ee, agent
contractor, subcontractor or any other person:
1. 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 his directions.
2. Sells any goods, articles or materials
to be processed or fabricated in or
abut a home and then rebuys them
after such processing or fabrication,
either by himself or through some
other person.
Q: Can the Er make deductions on HW's
earnings?
A:
GR: No Er, contractor or subcontractor
shall make any deduction from the HWs
earnings for the value of materials which
have been lost, destroyed, soiled or
otherwise damage.
XPN: Unless the ft. conditions are met:
1. The HW is clearly shown to be
responsible for the loss or damage
2. The Ee is given reasonable
opportunity to show cause why
deductions should not be made;
3. The amount of such deduction is fair
and reasonable and shall not exceed
the actual loss or damages; and
4. The deduction is made at such rate
that the amount deducted does not
exceed 20% of the HW's earnings in
a week.
78
Q: What is the duty of the Er in case the he
contracts with another the performance of
his work?
A: It shall be the duty of the Er to provide in
such contract that the Ees or HWs of the
contractor and the latter's subcontractor shall
be paid in accordance with the LC.
Q: What is the liabilty of the Er if the
contractor or subcontractor fails to pay the
wages or earnings of his Ees?
A: Er shall be jOintly and severally liable with
the contractor or sub-contractor to the workers
of the latter to the extent that such work is
performed under such contract, in the same
manner as if the Ees or HWs were directly
engaged by the Er.
Q: Can HWs form labor organizations?
A: Yes. DO No.5, replacing Rule XIV of the
IRR Book 3 of the LC, authorizes the formation
and registration of labor organization of
industrial HWs. It also makes explicit the Ers
duty to pay and remit SSS, Philhealth and
ECC premiums.
Q: What are the prohibitions against
homework?
A: No homework shall be performed on:
1. Explosives, fireworks and similar
articles;
2. Drugs and poisons; and
3. Other articles, the processing of
which requires exposure to toxic
substances. (Sec. 13, Rule XIV, Book
1I1,IRR)
Q: Distinguish
homeworkers.
househelpers from
A:
HOUSEHELPERS HOMEWORKERS
Performs in or about
his own home any
processing or
fabrication of goods or
materials, in whole or in
part, which have been
furnished directly or
indirectly, by an Er and
sold thereafter to the
latter.
Minister to the
personal needs and
comfort of his Er in the
latter's home
Q: J osie is the confidential secretaryof the
Chairman of the Board of the bank. She is
presently on matemity leave. In an
arrangement where the Chairman of the
Boardcanstill haveaccess to herservices,
the bank allows her to work in her
residence during her leave. For this
purpose, the bank installed a fax machine
in her residence, and gave her a ceilphone
and a beeper. Is J osie a homeworker under
the law? Explain.
@ ~
A: No, she is actually an office worker. She is
not an industrial homeworker who accepts
work to be fabricated or processed at home for
a contractor, which work, when finished, will be
returned to or repurchased by said contractor.
(Art. 155,LC) (2000BarQuestion)
Academics Committee
Vi ce-Chai r for Admi n &F i nance: Aissa CelineH. Luna
Vi ce-Chai r for L oyout &Desi gn: LoiseRae G.Naval
Labor Law Committee
Asst. Subj ed H ead' Domingo B.Diviva V
Members:
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelleC.Lee
]emuel PaoloM.Lobo
Andrew W.Montesa
UNIVERSITY OF SANTO TOMAS ~! 79
Iacu{taa ae <Derecfzo Ci vi C .
LABOR RELATIONS
LABOR RELATIONS Q: What is the control test?
,. POLICY AND DEFINITIONS
Q: What is labor relations?
A: It refers to the interactions between
employer (Er) and employees (Ees) or their
representatives and the mechanism by which
the standards and other terms and conditions
of employment are negotiated, adjusted and
enforced.
Q: What is labor relations law?
A: It defines the status, rights and duties and
the institutional mechanisms that govern the
individual and collective interactions of Ers,
Ees or their representatives.
It is concerned with the stabilization of
relations of Er and Ees and seeks to forestall
and adjust differences between them by the
encouragement of collective bargaining and
the settlement of labor disputes through
conciliation, mediation and arbitration.
Q: Distinguish labor relations from labor
standards.
A:
Labor
: Relations Labor Standards
Prescribes the minimum
terms and conditions of
employment which the Er is
required to grant its Ees
Regulates the
relations
between Ers
and workers
Q: What is collective bargaining (CB)?
A: It is a democratic framework to stabilize the
relation between labor and management to
create a climate of sound and stable industrial
peace.
It is the process of negotiation between an Er
and Ees' organization or union to reach
agreement on the terms and conditions of
employment for a specified period.
Note: CB process is possible only when there is
a labor organization, i.e. Labor union, Ees-ass'n.
Q: Can there be CB without an Er-Ee
relationship?
A: No. Er-Ee relationship must exist so that
labor relations law may apply within an
enterprise. Absent an Er-Ee relation, there is
no basis for organizing for purposes of CB
since there is no labor relation to speak of.
80
A: Under the control test, an Er-Ee relationship
exists where the person for whom the services
are performed reserves the right to control not
only the end achieved, but also the manner
and means to be used in reaching that end. It
is regarded as the most crucial and
determinative indicator of the presence or
absence of an Er-Ee relationship. (Almirez v.
Infinite Loop Technology Corp., G.R. No.
162401, Jan. 31, 2006, J . Carpio-Morales)
Q: For whose benefit is the control test
accorded?
A: For the benefit of the worker.
Q: Who has the burden of proof that worker
is an Ee of Er?
A: Burden is on the part of the worker that he
is an Ee but need not prove that he was
actually controlled.
Note: For control test to apply, it is not essential
for the Er to actually supervise the performance
of duties of the Ee, it being enough that it has the
right to wield the power. (Calamba Medical
Center, Inc., vs. NLRC, G.R. No. 176484, Nov.
25, 2008, J . Carpio-Morales)
Q: What happens if there is no certainty
that the worker under the control test is an
Ee?
A: Economic reality test will be used to
determine whether a worker is an Ee of the Er.
Q: What is economic reality test?
A: It is another important test of an Er-Ee
relationship which inquires whether or not a
worker is spending all his time for the Er and is
dependent on the latter for his income.
Note: There is no problem if worker is controlled
by an Er. He is an Ee under the control test.
Q: What are the rights of workers
guaranteed by the 1987 Constitution?
A: Sec. 3, Art. X/II of the 1987 Constitution
guarantees to all workers their right to:
1. Self - organization;
2. CB and negotiations;
3. Peaceful concerted activities
including right to strike in accordance
with law;
4. Security of tenure;
5. Humane conditions of work;
6. Living wage; and
7. Participation in policy and decision-
making processes involving their
rights and benefits as may be
provided by law.
Q: What are the policy objectives of our
labor relations law?
A: The State aims to promote:
1. Free collective bargaining) (CB) -and
negotiations, including voluntary
arbitration, mediation and conciliation
as modes of settling labor or
industrial disputes
2. Free trade unionism
3. Free and voluntary organization of a
strong and united labor movement
4. Enlightenment of workers concerning
their rights and obligations as union
members and as Ees
5. Adequate administrative machinery
for the expeditious settlement of labor
or industrial disputes
6. Stable but dynamic and ju?t industrial
peace
7. Participation of workers in the
decision-making processes affecting
their rights, duties, and welfare
8. Truly democratic method of regulating
the relations between the Ers and
Ees by means of agreements freely
entered into through CB, no court or
administrative agency or official shall
have the power to set or fix wages,
rates of pay, hours of work or other
terms and conditions of employment,
except as otherwise provided under
the LC.
ART. 212. DEFINITIONS
Q: Who is an employer (Er)?
A: Any person acting in the interest of an Er
directly or indirectly. The term does not includ~
a labor organization (LO) or any of its officers
and agents, except when acting as an Er.
(Art. 212[eJ)
An Er is defined as any person or entity that
employs the services of others; one for whom
work and who pays their wages of salaries;
any person acting in the interest of an Er;
refers to the enterprise where the LO operates
or seeks to operate. (Sec. 1lSi, Rule I, Book V,
IRR)
Q: When is a labor organization deemed an
Er?
A: When it is acting as such in relation to
persons rendering services under hire,
particularly in connection with its activities for
profit or gain.
Note: The mere fact that respondent is a labor
union does not mean that it cannot be considered
an Er for persons who work for it. Much less
should it be exempted from labor laws. (Bautista
v. inciong, GR. No. L-52824, Mar. 16, 1988)
Q: Who is an employee (Ee)?
A:
1. Any person in the employ of the Er
2. 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
3. One who has been dismissed from
work but the legality of dismissal is
being contested in a forum of
appropriate jurisdiction. (D. O. No. 40-
03, Mar. 15, 2003)
Note: The term shall not be limited to the Ees of
a particular Er unless the LC explicitly states.
Any Ee, whether employed for a definite period or
not, shall, beginning on the first day of service, be
considered an Ee for purposes of membership in
any labor union. (Art. 277[c), LC)
Q: What is a labor dispute?
A: Includes any controversy or matter
concerning:
1. Terms and conditions of employment,
or
2. The association or representation of
persons in negotiating, fixing,
maintaining, changing or arranging
the terms and conditions of
employment
3. Regardless of whether the disputants
stand in the proximate relation of Er
and Ee. (Art.212[lj)
Q: What are the tests on whether a
controversy falls within the definition of a
labor dispute?
A:
1. As to nature - It depends on whether
the dispute arises from Er-Ee
relationship, although disputants
UNIVERSITY OF SANTO TOMAS ~i~ 81
PacuCtaa de I Der ecno Civif .'
LABOR RELATIONS
need not be proximately "Er' or "Ee"
of another.
2. As to subject matter - The test
depends on whether it concerns
terms or conditions of employment or
association or representation of
persons in negotiating, fixing,
maintaining or changing terms or
conditions of employment.
Q: What are the kinds of labor disputes?
A:
1. Labor standard disputes
a. Compensation E.g.
Underpayment of minimum
wage; stringent output quota;
illegal pay deductions
b. Benefits - E.g. Non-payment of
holiday pay, OT payor other
benefits
c. Working Conditions E.g.
Unrectified work hazards
2. Labor relations disputes
a. Organizational right
disputes/ULP - E.g. Coercion,
restraint or interference in
unionization efforts; reprisal or
discrimination due to union
activities; company unionism;
ULP, strike or lockout; union
members' complaint against
union officers
b. Representation disputes - E.g.
Uncertainty as to which is the
majority union; determination of
appropriate CS unit; contests for
recognition by different sets of
officers in the same union
c. Bargaining disputes E.g.
Refusal to bargain; bargaining in
bad faith; bargaining deadlock;
economic strike or lockout
d. Contract administration or
personnel policy disputes - E.g.
Non-compliance with CSA
provision (ULP if gross non
compliance with economic
provisions); disregard of
grievance machinery; non
observance of unwarranted use
of union security clause; illegal or
unreasonable personnel
management policies; violation of
no-strike/no-Iockout agreement
e. Employment tenure disputes -
E.g. Non-regularization of Ees;
non-absorption of labor only
contracting staff; illegal
82
termination; non-issuance of
employment contract
Q: Who are the parties to a dispute?
A:
1. Primary parties are the Er, Ees and
the union.
2. Secondary parties are the voluntary
arbitrator, agencies of DOLE, NLRC,
Secretary of Labor and the Office of
the President.
Q: What is an inter-union dispute?
A: Any conflict between and among legitimate
labor unions involving representation
questions for the purposes of CS or to any
other contlict or dispute between legitimate
labor unions.
Q: What is an intra-union dispute?
A: Any conflict between and 'among union
members, grievances arising from any
violation of the rights and conditions of
membership, violation of or disagreement over
any provision of the union's constitution and
by-laws, or disputes from chartering or
affiliation of union.
Q: What are rights disputes?
A: They are claims for violations of a specific
right arising from a contract, i.e. CSA or
company policies.
Q: What are interest disputes?
A: They involve questions on "what should be
included in the CSA". Strictly speaking, the
parties may choose a voluntary arbitrator to
decide on the terms and conditions of
employment, but this is impracticable because
it will be a value judgment of the arbitrators
and not of the parties.
Q: What are contract-negotiation disputes?
A: These are disputes as to the terms of the
CSA.
Q: What are contract-interpretation
disputes?
A: These are disputes arising under an
existing CSA, involving such matters as the
interpretation and application of the contract,
or alleged violation of its provisions.
:, RIGHT TO SELF ORGANIZATION
ART. 24.6. NON-ABRIDGEMENT OF RIGHT
" " :'[0SELF ORGANIZATION
Q: What is the extent of the right to self-
organization?
A: It includes the right:
1. To form, join and assist labor
organizations for the purpose of
collective bargaining (CB:) through
representatives of their 'own
choosing; and
2. To engage in lawful and concerted
activities for the purpose of CS or for
their mutual aid and protection. (Art.
246)
Q: May the right to self-organization be
bargained away?
A: No. It must be upheld in the absence of
express provision of the law to the contrary. It
cannot be curtailed by a CSA. (SPFL v.
Calleja, GR. No. 80882, April 24, t989)
Q: Who are the persons! Ees eligible to join
a labor organization (LO) for purposes of
CB?
A: The entities covered are all persons
employed in:
1. Commercial, industrial, and
agricultural enterprises; and
2. Religious, charitable, medical or
educational institutions whether
operating for profit or not. (Art. 243)
Q: Who are the personsl Ees eligible to join
a Lafor mutual aid and protection?
A: The following enjoy the right to self-
organization for mutual aid and protection:
1. Ambulant workers
2. Intermittent workers
3. Itinerant workers
4. Self-employed people
5. Rural workers
6. Those without any definite Ers. (Art.
243)
Q: Who are the personsl Ees not granted
the right to self-organization?
A:
1. High level or managerial gov't Ees.
(Sec. 3, E.O. 180)
2. Ees of int'l organizations with
immunities. (fCMC v. Calleja, G.R.
No. 85750, Sep. 28,1990)
3. Managerial Ees. (Art. 212 of LC)
4. Members of the AFP including police
officers, policemen, firemen, and jail
guards. (Sec. 4, E.O. 180)
5. Confidential Ees. (Metrolab Industries
Inc. v. Confesor, G.R. No. 108855,
Feb. 28, 1996)
6. Ees of cooperatives who are its
members (Benguet Elec. Coop. V.
Ferrer-Calleja, G.R. No. 79025, Dec.
29, 1989); However they may form
worker's association. (NEECO Ees'
Assoc. v. NLRC, G.R. No. 16066,
Jan.24, 2000)
7. Non-Ees. (Rosario Bros. v. Ople,
G.R. No. L-5390, July 31, 1984)
8. Gov't Ees, including GOCCs with
original charters (Arizala v. CA, G.R.
Nos. 43633-34, Sep. 14, 1990)
9. Aliens without a valid working permit
or aliens with working permit but are
nationals of a country which do not
grant Filipinos to the exercise the
right of self-organization and to join or
assist labor organizations. (Art. 269 of
LC; D.O. NO.9 [1997J, Rule II, Sec. 2)
Q: What is the concept of non-abridgement
of right to self organization?
A: It shall be unlawful for any person to
restrain, coerce, discriminate against or unduly
interfere with Ees in their exercise of the right
to self-organization. (Art. 246)
Note: Any act intended to weaken or defeat
the right is regarded by law as an offense,
which is technically called "unfair labor
practice".
UNIVERSiTY OF SANTO TOMAS ~. 83
PacuCtaa de < Der ecl i o CiviC ',.'
LABOR RELATIONS: SPECIAL GROUPS OF EMPLOYEES
f SPECIAL GROUPS OF EMPLOYEES
Q: What are the special groups of Ees?
A:
1. Managerial and supervisory Ees
2. Confidential Ees
3. Security guards
4. Members of cooperatives
5. Religious objectors
6. Gov't Ees
7. Ees of int'I organizations
MANAGERIAL AND SUPERVISORY
; EMPLOYEES '
Q: Who are managerial Ees?
A: Those vested with the powers and
prerogatives to:
1. Lay down and execute management
policies; and/or
2. Hire, transfer, suspend, lay-off, recall,
discharge, assign or discipline Ees.
(Sec. 1[hh), Rule I, Book V, IRR)
Q: Distinguish Managerial Ees (ME) in
Labor Standards from ME in Labor
Relations.
A:
t ME under Lab STO
I
ME under Lab REL
Primary duty consists
Lay down and execute
of the management of
the establishment in
management policies
which they are
and/or to hire, transfer,
employed or of a
suspend, lay-off, recall,
department or
discharge, assign or
division.
discipline Ees.
Does not include the
managerial staff since
Includes the officers they are classified as
and members of the supervisory Ees (may/
managerial staff. may not be eligible to
join labor union with
rank-and-file Ees)
To determine whether
To determine Ees
or not certain Ees are
covered by Book III of
eligibility in
the LC on conditions
joining/forming a labor
of employment.
union.
Q: Does the mere designation of an Ee as
"manager" ipso facto make him one?
A: No. Designation should be reconciled with
the actual job description of the Ee for it is the
job description that determines the nature of
employment". (APC VS. Farolan, G.R.
No. 151370, Oec.4, 2002, J . Carpio-Morales)
84
Note: It is the nature of the Ee's function and not
the nomenclature or title given to his job which
determines whether he has a rank-and-file or
managerial status. (Eng'g Equipment, Inc. v.
NLRC, G.R. No. L-59221, Dec. 26, 1984)
Q: Who are supervisory Ees?
A: Those who, in the interest of the Er,
effectively recommend such managerial
actions if the exercise of such authority is not
merely routinary or clerical in nature but
requires the use of independent judgment.
(Sec. 1, Rule I, Book V, IRR)
Q: Who are rank-and-file Ees?
A: Those whose function is neither managerial
nor supervisory in nature.
Q: Are managerial Ees eligible to join,
assist or form any labor organization (LO)?
A:
GR: No, managerial Ees are prohibited to
organize for collective bargaining because
they are the alter egos of the Ers and thus
they are supposed to be on the side of the
Er to act as its representatives, and to see
to it that its interests are well protected.
The Er is not assured of such protection if
these Ees are union members. (Bulletin
Publishing Co. Inc. v. Sanchez, G.R. No.
74425, Oct. 7, 1986)
XPN: They are not prohibited from
organizing for other purposes such as for
mutual aid and protection. (Pagkakaisa ng
mga Manggagawa sa Triumph tnt'! v.
Ferrer-Calleja, G.R. No. 85915, Jan. 17,
1990)
Q: Is Art. 245 of the LC a violation of the
right to self-organization of managerial
Ees?
A: No. They are not deprived of the right to
organize. J ust like any right, the right to self-
organization is not an absolute right. It is
subject to the police power of the State, as
well as to certain limitation.
Note: Art. 245 does not absolutely disqualify
managerial Ees from exercising their right to
association. What it prohibits is merely the right to
join labor organizations.
Q: May supervisory Ees form, assist, join a
LO?
A: Yes. They may form, assist and join LOs on
their own but not with the rank-and-file Ees.
(Art. 245, as amended by R.A. 9481)
If one exercises independent judgment which
is not subject to the evaluation of other
department heads/superiors, then they may
form a LO on their own (separate from the
rank-and-file).
If their responsibilities do not inherently require
the exercise of discretion and independent
judgment, then they may join the union
composed of the rank-and-file Ees.
Q: What is the test in determinin~ whether
an Ee is managerial or supervisory? ~
A:
1. Whether a person possesses
authority to act in the interest of his Er
or
2. Whether such authority is not merely
routinary or clerical in nature but
requires the use of independent
judgment.
Note: If recommendatory powers are subject to
evaluation, review, and final action of a
department head or other higher executives of a
company, it is not considered an exercise of
independent judgment as required by law. (Baker
v. Trajano, G.R. No. L-75039, Jan. 28, 1988)
Q: Are professors, associate professors,
and assistant professors high-level Ees?
A: No. They cannot be considered as
exercising managerial or highly confidential
functions as would justify their being
categorized as "high-level Ees". It is the
University Academic Personnel Committee
(dean, assistant for academic affairs, and chief
personnel) which formulates policies,
standards and rules respecting selection,
compensation, and promotion. Hence, such
Ees are considered as rank and file. (UP v.
Ferrer-Calleja, G.R. No. 96189; July 14, 1992)
Q: What is commingling?
A: It is membership of supervisory and rank-
and-file Ees in one and the same labor
organization.
Q: Is commingling allowed at the plant
level?
A: No. Supervisory Ees shall not be eligible for
membership in the collective bargaining unit of
the rank-and-file Ees. (Art. 245, as amended
by R.A. 9481)
Note: A LO composed of both rank-and-file and
supervisory Ees is not a LO at all. It cannot for
any guise or purpose be considered a legitimate
LO. (Toyota Motor Phi/so Corp. v. Toyota Motor
Phils Corp. Labor Union, G.R. No. 121084, Feb.
19, 1997)
Q: What is the reason behind the exclusion
of supervisors from unions of rank-and-file
Ees at plant level?
A: Supervisory Ees, while in the performance
of supervisory functions, become the alter ego
of management in the making and the
implementing of key decisions at the sub-
managerial level. Certainly, it would be difficult
to find unity or mutuality of interests in a
bargaining unit consisting of a mixture or rank-
and-file and supervisory Ees. This is so
because the fundamental test of a bargaining
unit's acceptability is whether or not such a
unit will best advance to all Ees within the unit
the proper exercise of their CB rights".
(TMPLU v. Toyota Motor Phils, GR. No.
135806, Aug. 8, 2002)
Q: Is commingling allowed at the federation
level?
A: Yes. The rank-and-ftle union and the
supervisors' union operating within the same
establishment may join the same federation or
national union. (Art. 245, as amended by R.A.
9481)
CONFIDENTIAL EMPLOYEES
Q: Who are confidential Ees?
A: Those entrusted with confidence on
delicate matters or with the custody, handling,
or care and protection of the Er's property.
(NA TU-Republic Planters Bank Supervisors
Chapter v. Torres, G.R. No. 93468, Dec. 29,
1994)
Q: What are the criterias to determine
whether one is a confidential Ee?
A:
1. Assist and act in a confidential
capacity, or
2. Have access to confidential matters
of persons who exercise managerial
functions in the field of labor relations.
(Philips Industrial Dev't v. NLRC, G.R
No. 161933, June 25, 1992)
Note: The 2 criteria are cumulative, and both
must be met if an Ee is to be considered a
confidential Ee.
UNIVERSITY OF SANTO TOMAS ( ... ~. 85
PacuCtaa de (])erecfio Ci vi C -.-
LABOR RELATIONS: SPECIAL GROUPS OF EMPLOYEES
Q: What does the phrase "in the field of
labor relations" mean?
A: It stresses labor nexus.The confidential
information must be related to labor relations
matters. When the Ee does not have access to
confidential labor relations information, then
the prohibition to form, join, or assist a union
does not apply. (Sugbuanon Rural Bank v.
Laguesma, G.R. No. 116194, Feb. 2, 2000)
Note: If an Ee has access to confidential labor
relations information but such is merely incidental
to his duties and knowledge thereof is not
necessary in the performance of such duties,
such access does not render the Ee a
confidential Ee. (SMC Supervisors and Exempt
Union v. Laguesma, G.R. No. 110399, Aug. 15,
1997)
Q: May confidential Ees form, assist or join
a labor organization (LO)?
A: No. The disqualification is based on the
doctrine of necessary implication which
provides that what is implied in a statute is as
much part thereof as that which is expressed.
Under Art. 245 of the LC, managerial Ees are
prohibited from joining, assisting, or forming
any LO. But by virtue of necessary implication,
confidential Ees are similarly disqualified.
(National Association of Trade Union (NA TU)
v. NLRC, G.R. No. 93468, Dec.29, 1994)
Q: J emuel is the Executive Secretary of
the SVP of a bank while Genesis is the
Legal Secretary of the bank's lawyer.
They and other executive secretaries
would like to join the union of rank-and-file
Ees of the bank. Are they eligible to join the
union? Why? Explain briefly.
A: No. The following rules will govern the
right of selt-orqanlzation of J emuel, Genesis,
and the other executive secretaries:
1. No Right to Self-Organization
Confidential Ees who act in a
confidential capacity to persons who
formulate, determine, and effectuate
management policies in the field of
labor- management relation. The 2
criteria are cumulative and both must
be met. (SMC Supervisors and
Exempt Union v. Laguesma, G.R. No.
110399, Aug. 15, 1997)
2. With Right to Self-Organization
When the Ee does not have access
to confidential labor relations
information, there is no legal
prohibition against confidential Ees
from forming, assisting, or joining a
86
LO. (Sugbuanon Rural Bank v.
Laguesma, G.R. No. 116194, Feb. 2,
2000)
In the case at bar, legal secretaries fall under
the category of confidential Ees with no right to
self-organization. (Pier & Arrastre Stevedoring
Services, Inc. v. Confessor, GR. No. 110854
Feb. 13, 1995) (2002 Bar Question)
Q: Is a managerial Ee a confidential Ee?
A: Yes. Every managerial position is
confidential because one does not become a
manager without having gained the confidence
of the appointing' authority. But not every
confidential Ee is managerial; he may be a
supervisory or even a rank-and-file Ee.
, SECURITY GUARDS ,
Q: May security guards join a labor
organization (LO)?
A: Yes. Under R.A. 6715, security guards may
now freely join a LO of the rank-and-file or that
of the supervisory union, depending on their
rank. (Manila Electric Co. v. Sec. of Labor and
Employment, G.R. No. 91902, May 20, 1991)
I MEMBERS OF COOPERATIVES
Q: May members of a cooperative join a
LO?
A: No. An Ee of a cooperative who is at the
same time a member and co-owner cannot
invoke the right to collective bargaining, for
certainly an owner cannot bargain with himself
or his co-owners. However, to Ees who are
neither members nor co-owners of the
cooperative they are entitled to exercise the
rights to self-organization, CB and negotiation.
(San Jose Electric Service Cooperative, Inc.
vs. Ministry of Labor, G.R. No. 77231, May 31,
1989)
Note: It is the fact of ownership of the
cooperative, not the involvement in management,
which disqualifies a member from joininq any LO.
(Benguet Electric Coop. v. Ferrer-Calleja, G.R.
No. 79025, Dec. 29, 1989)
;~. ~. RELIGIOUSOBJ ECTORS. _ ""
Q: Victoriano is a member of Iglesia ni
Cristo (INC) and an Ee of the company
which had a CBA containing a closed-shop
provision. A law was passed exempting
members of any sect who prohibits
affiliation of their members from joining
any labor organization (LO). Victoriano
then resigned but the union opposed and
manifested that he should be dismissed
due to the closed-shop provision of the
CBA. May a member of the INC be
compelled to join a labor union under a
CSA with a closed-shop proviso?
A: No. Members of said religious sect whose
teaching forbid membership in a labor union
cannot be compelled to join any labor union or
refused employment or be dismi~sed f[om
their job on the ground that they are' not
members of the bargaining unit. The right to
join a LO includes the right not to join.
Moreover, religious freedom, although not
unlimited, is a fundamental personal right and
liberty, and has a preferred position in the
hierarchy of values. (Victoriano v. Elizalde
Rope Workers Union, GR. No.L-25246, Sep.
12, 1974)
Q: May religious objectors form their own
union?
A: Yes. The right of the members of INC not to
join a labor union for being contrary to their
beliefs does not bar them from forming their
own union. The recognition of the belief of the
sect should not infringe on the basic right of
self-organization granted by the Constitution.
(Kapatiran Sa Meat and Canning Division v.
Ferrer-Calleja, G.R. No. L-82914, June 20,
1988)
'Facu{taa ae Verecfio Ci vi l
87
LABOR RELATIONS: EMPLOYEES IN THE PUBLIC SERVICE
, ART. 244. RIGHT OF EMPLOYEES IN THE
: PUBLIC SERVICE
, ART. 276.GOVERNMENT EMPLOYEES
Q: Are the Ees in public service covered by
the right to self-organization?
A: Yes.
1. Ees of gov't corporations established
under the Corporation Code shall
have the right to organize and
bargain collectively with their
respective Ers. (Bliss Dev't Corp.
Union v, Ferrer-Cal/eja, G.R. No.
80887, Sep. 30, 1994)
2. All other Ees in the civil service shall
have the right to form associations for
purposes not contrary to law.
Q: Who are allowed to jorn Ees
organization in the public sector?
A: AIIEesin:
1, Agencies of the national gov't and
their regional offices, attached
agencies and their regional office
2. State universities and colleges
3. GOCCs with original charters
4. LGUs
Can form, Join or assist:
1. Ees' organizations
2, Labor management committees
3. Work councils
4. Other forms of Ees' participation
schemes of their own choosing.
Note: Eligibility for membership in any Ees'
organization shall commence on the first day of
Ee's service.
Q: When will a corporation created under
the Corporation Code be deemed as a
GOCC?
A: The ownership test has been applied
consistently. A corporation shall be deemed a
GOCC if the majority of its voting stocks are
owned by the gov'!. (Bliss Dev't Corp. Union v.
Ferrer-Calleja, G.R.No. 80887, Sep. 30, 1994)
Q: Who are those gov't Ees not allowed to
join Ees' organizations?
A:
1. High-level, highly-confidential and
coterminous Ees
2. Members of the AFP
3. Members of the PNP
4. Firemen
88
5. J ail guards
6. Other personnel who, by nature of
their functions, are authorized to carry
firearms, except when there is
express written approval from
management.
Q: What are the protections given on the
gov't Ees' right to organize?
A:
1. Gov't Ees shall not be discriminated
against by 'reason of their
membership in Ees' organizations or
participation in the normal activities
of their organization. (Sec. 5, E.O.
180)
2. Their employment shall not be
subject to the condition that they
shall not join or shall relinquish their
membership in the Ees'
organizations. (ibid)
3. Gov't authorities shall not interfere in
the establishment, functioning or
administration of gov't Ees'
organization through acts designed
to place such organizations under
the control of gov't authority. (Sec. 6,
E.O. 180)
Q: Who are high level employees (Ees)?
A: Those who perform managerial functions
such as the exercise of powers to formulate
management policies and decisions, or to hire,
transfer, assign, lay-off, recall or discipline
Ees.
Q: Who are highly-confidential Ees?
A: Those who occupy a position which
requires a high degree of trust and confidence
and close intimacy with the appointing
authority or immediate" supervisor which
ensures free and open communication without
harassment or freedom from misgivings '.of
betrayal of personal trust or confidential
matters of state. The term is used
interchangeably with primarily confidential Ees.
Q: Are gov't Ees allowed to go on strike?
A: No. By reason of the peculiar character of
the public service, it must necessarily regard
the right to strike given to unions in the private
industry as not applying to public Ees. It has
been stated that the gov't, in contrast to the
private Er, protects the interest of all people in
the public service, and that accordingly such
conflicting interest as are present in private
labor relations could not exist in the relations
between the gov't and those whom they
employ.
Moreover, the CSC declared that the right to
self organization accorded to gov't Ees shall
not carry with it the right to engage in any form
of prohibited concerted activity or mass action
causing or intending to cause work stoppage
or service disruption, albeit of temporary
nature. (Sec. 4, Resolution No. 021316, Oct.
11, 2002; Jacinto v. CA, GR. No. 124540,
Nov. 14, 1997)
Q: Because of al/eged "ULPs" by the
management of GFI System, a gov't-
ownedandcontrolled financial corporation,
its Ees walked out from their jobs and
refused to return to work until the
management would grant their union
official recognition & start negotiations
with them. The leaders of the walk-out
were dismissed, andthe other participants
were suspended for 60 days. In arguing
their case before the CSC, they cited the
principle of social justice for workers and
the right to self-organizationand collective
action, including the right to strike. They
claimed that the Constitution shielded
themfrom any penalty becausetheir walk-
out was a concerted action pursuant to
their rights guaranteedby the basic law. Is
the position taken by the walk-out
leaders and participants legally correct?
Reasonbriefly.
A: The position taken by the walk-out leaders
and participants is not legally correct. They are
gov't Ees, and as such, they do not have the
right to strike. According to the actual
wording of Sec. 3 of Art. XIII of the
Constitution, the State "shall guarantee the
rights of all workers to self-organization, CB
and negotiations, and peaceful concerted
activities including the right to strike in
accordance with law."
Thus, the last clause of the above-quoted
provision of the Constitution makes it very
clear: the right to strike is not constitutional, it
is statutory because the right should be "in
accordance with law". And there is as yet
no law giving gOY'! Ees the right to strike.
(2004BarQuestion)
Q: What are the matters that may be the
subject of negotiation?
organizations and appropriate qov't
authorities. (Sec. 13, E. a 180)
XPN: Those terms and conditions of
employment that are fixed by law.:-
Q: Distinguish the rights of Ees in GOCCs
with original charters from those without
original charter.
A:
GOCC
wI Original Charter w/o Original Charter
Not allowed to strike.
Note: Governed by Civil
Allowed to strike
subject to the
Service Law.
provisions of the LC.
Enjoined by CS Memo
Note: Created under
Circular 6, under the
the Corporation Code
pain of administrative
therefore the Ees
sanctions from staging
have the same rights
strikes, demonstrations,
as those of in the
mass leaves, walkouts
private sector.
and other concerted
activities.
Cannot bargain wi the
gov't. concerning the
conditions of their
employment.
Note:However, they
can negotiate (through Can Bargain. Has
collective negotiation unlimited bargaining
agreements or MOA) rights.
with the gov't. on those
terms and conditions of
employment wlc are not
fixed by law. They have
limited bargaining
riqhts,
Can only join or assist Can only join or assist
Las for purposes not Las for purposes of
contrary to law. CBA, etc.
Note: Ees of the gov't corporations incorporated
under the Corporation Code and registered with
the SEC are governed by the LC and not by E.O.
180. They are allowed to organize because they
are not involved in public service and the terms of
their employment are not fixed by law.
Q: What are considered as non-negotiable
terms and conditions of employment in
GOCCswith original charters?
A: Those which:
1. Require appropriation of funds
2. Involve the exercise of management
prerogatives
A:
GR: The terms and conditions of
employment or improvements in gov't
services may be the subject of negotiations
between duly recognized Ees'
UN I V E R SIT Y 0 F SAN ToT 0 M.A ~ ~~::,! 89
'Facu[taa de (])erecfio Ctvd ~
LABOR RELATIONS: EMPLOYEES IN THE PUBLIC SERVICE
Q: What are those which require
appropriation of funds?
A:
1. Increase in salary and emoluments
and other allowance not presently
provided for by law
2. Facilities requiring capital outlays
3. Car plan
4. Provident fund
5. Special hospitalization, medical,
dental and dental services
6. Rice, sugar and other subsidies
7. Travel expenses
8. Increase in retirement benefits
Q: What are those negotiable terms and
conditions of employment in GOCCs with
original charters?
A:
1. Schedule of vacation and other
leaves
2. Work assignment of pregnant women
3. Personal growth and development
4. Communication system (lateral and
vertical)
5. Provision for protection and safety
6. Provision for facilities for
handicapped personnel
7. Provision for first-aid medical services
for married women
8. Annual medical/physical examination
9. Recreational, social, athletic and
cultural activities and facilities. (Rules
implementing E.O. 180)
90
EMPLOYEES OF INTERNATIONAL
ORGANIZATIONS
Q: What is an international organization
(IO)?
A: It is an organization set up by agreement
between two or more States.
Q: What are specialized agencies?
A: Are las having functions in particular fields.
Q: May Ees of lOs organize?
A: Yes.
Q: May a certification election be
conducted in an 10 which the Phil. Gov't
has granted immunity from local
jurisdiction?
A: No. The grant of immunity from local
jurisdiction to ICMC and IRRI is clearly
necessitated by their int'I character and
respective purposes. The objective is to avoid
the danger of partiality and interference by the
host country in their internal workings. The
. exercise of jurisdiction by the DOLE in these
instances would defeat the very purpose of
immunity, which is to shield the affairs of int'I
organizations, in accordance with int'I practice,
from political pressure or control by the host
country to the prejudice of member States of
the organization, and to ensure the
unhampered performance of their functions.
(lCMC v. Calleja, G.R. No. 85750, Sep. 28,
1990)
f . ACQUISITION AND RETENTION OF
i, _, MEMBERSHIP; UNION SECURITY
I . AGREEMENTS .
Q: Enumerate LC provisions which governs
the acquisition and retention of
membership in a labor organization?
A:
1. An Ee, whether employed for a
definite period or not, shall, beginning
on his first day of .setvi ce, be
considered an Ee for ~purpoSes of
membership in any labor union. (Art.
277[cJ)
2. Nothing in the LC or in any other law
shall stop the parties from requiring
membership in a recognized
collective bargaining (CS) agent as a
condition of employment, except
those Ee's who are already members
of another union at the time of the
signing of the CSA (Art. 248[e])
Q: What is a union security clause?
A: It is a generic term which is applied to and
comprehends "closed shop", "union shop",
"maintenance of membership" or any other
form of agreement which imposes upon
employees the obligation to acquire or retain
union membership as a condition affecting
employment.
Note: Inclusion of union security clause in CSA is
not considered as ULP.
Q: What are the principles of union security
cl ausesl arran gements?
A:
1. Protection - To shield union members
from whimsical and abusive exercise
of management prerogatives.
2. Benefits - An additional source of
income to the union in the form of
union dues and special assessments.
3. Self-preservation - It strengthens the
union through selective acceptance of
new members on the basis of
commitment and loyalty.
Q: What are the kinds of union security
agreements?
A:
1. Closed shop - Only union members
can be hired by the company and
they must remain as union members
in good standing to retain
employment in the company.
Note: It does not have any retroactive
effect.
2. Semi-closed shop agreement- The
prospective Ee must be a member of
the union as a condition of
employment and has no requirement
for the Ee to remain as a member of
the contracting union in good
standing as a condition for continued
employment.
3. Union shop - Non-members may be
hired, but to retain their employment
must become union members after a
certain period. (Requirement applies
to present and future Ees)
4. Modified union shop - Ees who are
not union members at the time of
signing the contract need not join the
union, but all workers hired thereafter
must join.
5. Maintenance of membership shop -
No Ee is compelled to join union, but
all present and future members must,
as a condition of employment, remain
in good standing in the union.
6. Exclusive bargaining shop - The
union is recognized as the exclusive
bargaining agent of all Ees in the
bargaining unit, whether union
members or not.
7. Bargaining for members only - The
union is recognized as the bargaining
agent only for its members.
8. Agency shopl treasury shop - An
agreement whereby Ees must either
join the union or pay the union as
exclusive bargaining agent a sum
equal to that paid by the members.
(This is directed against "free rider"
Ees who benefit from union activities
without contributing financially to
union support.)
9. Open shop - An arrangement which
does not require union membership
as a condition for employment.
10. Preferential shop agreement - An
agreement whereby the Er merely
agrees to give preference to the
members of the bargaining union in
hiring, promotion or filing vacancies
and retention in case of lay-off. The
Er has the right to hire from the open
market if union members are not
available.
UNIVERSITY OF SANTO TOM.A~ ~.! 91
Pacu(taa de 1Jer ecno Cl'fJ l( .;
LABOR RELATIONS: MEMBERSHIP IN LABOR ORGANIZATIONS
Note:The law has sanctioned stipulations for the
union shop and the closed shop as a means of
encouraging the workers to join and support the
labor union of their own choice as their
representative in the negotiation of their demands
and lhe protection of their interest vis-a-vis the
Er. ,(Liberty Flour Mills Ees v. Liberty Flour Mills,
G.R. No. 58768-70, Dec. 29, 1989)
Q: Is aclosed-shopagreementvalid?
A: Yes. It is true that disaffiliation from a labor
union is not open to legal objection. It is
implicit in the freedom of association ordained
by the Constitution. But a closed shop
provision is a valid form of union security, and
such provision in a CSA is not a restriction of
the right of freedom of association guaranteed
by the Constitution. (Villar v. Inciong, G.R.
Nos. L-50283-84, April 20, 1983)
Note: In order that the maintenance of
membership clause to take effect and entitle the
company to dismiss those who did not maintain
membership, it must be a clear and unequivocal
stipulation that maintenance of membership is a
condition for continued employment. (Manila
Cordage Co. v. CIR, G.R. No. L-27079, Aug. 31,
1977)
Q: Who are the Ees not covered by the
closedshop provision?
A:
1. Any Ee who at the time the closed-
shop agreement takes effect is a
bona fide member of a religious
organization which prohibits its
members from joining labor unions on
religious grounds
2. Ees already in service and already
members in a labor union or unions
other than the majority union at the
time the closed shop agreement took
effect
3. Confidential Ees who are excluded
from the rank and file bargaining unit
4. Ees excluded from the closed shop
by express terms of the agreement.
Q: Victoriano is a member of INC and an
employeeof the companywhich hada CBA
containing a closed-shop provision. A law
was passed exempting members of, any
sect who prohibits affiliation of their
members from J Oining any labor
organization. Victoriano then resigned but
the union opposed and manifested that he
should be dismissed due to the closed-
shop provision of the CBA. The further
argues that the lawimpairs obligations and
contracts.
92
Is thedismissal of the Victoriano duetothe
closed-shop proviso proper?
A: No. Members of said religious sect whose
teaching forbid membership in a labor union
cannot be compelled to join any labor union or
refused employment or be dismissed from
their job on the ground that they are not
members of the bargaining unit. Moreover,
religious freedom, although not unlimited, is a
fundamental personal right and liberty, and
has a preferred position in the hierarchy of
values. (Victoriano v. Elizalde Rope Workers
Union, GR. No.L-25246, Sep. 12, 1974)
Q: A CBA was entered into between the
company and the union containing a
closed shop proviso. Santos was already
an Ee of the company prior to the
effectivity of the CBA. Hewas required by
the companytojoin the Union. Santoswas
dismissed due to his refusal to join the
union. Is the closed-shop proviso in the
CBAapplicabletoold Ees?
A: Yes. The closed-shop proviso of a CSA
entered into between the bargaining union and
Er is applicable to the old Ees provided they
are not members of any LO at the time the
CSA was entered into. On the other hand, an
Ee who is already a member of another union
at the time the CSA took effect cannot be
compelled to be a member of the current
bargaining agent. (Santos-Juat v. CIR, G.R.
No. L-20764, Nov. 29, 1965)
Q: In a certification election conducted by
the DOLE, Associated Workers
Organization in Laguna (AWOL) headedby
Bastian Flores, won over Pangkat ng mga
Manggagawasa Laguna (PML), headedby
Martin Ortiz. Hence,AWOLwas certified as
the exclusive bargaining agent of the rank-
and-file Ees of the Laguna Transportation
Company(LTC).
Shortlythereafter, a CBAwas concluded by
LTC and AWOL which provided for a
closed shop. Consequently, AWOL,
demandedthat Martin Ortiz and all the PML
members be required to become members
of AWOLas a condition for their continued
employment. Otherwise, they shall be
dismissed pursuant to the closed shop
provision of the CBA.
The union security clause of the CBA also
providedfor the dismissal of Eeswho have
not maintained their membership in the
union. For one reason or another, Ruben
Simbulan, a member of AWOL, was
expelled from the union membership for
acts inimical to the interest of the union.
Upon receipt of the notice that Ruben
Simbulan failed to maintain his
membership in good standing with AWOL,
LTC summarily dismissed him from
employment.
Can Martin Ortiz and all the PML members
be required to become members of the
AWOL pursuant to the closed shop
provision of the CBA? Why?
(:j ..
A: Martin Otiz and all the PML members can
not be required to become members of AWOL
pursuant to the closed shop provision of the
CBA. According to Art 248(e) of the LC, a
closed shop provision cannot be applied to
those Ees who are already members of
another union at the time of the signing of the
CBA.
Q: Is the termination from employment of
Ruben Simbulan by LTC lawful? Why?
A: Pursuant tothe closed shopprovisionof the
CBA entered into by AWOL with LTC,
membership in AWOL has become a condition
of employment in LTC. As long as the
expulsion of Ruben Simbulan fromAWOL
was done in accordance with applicable
provisions of lawand with the Constitutionand
By-laws of the AWOL, then it was lawful for
LTC to terminate Simbulan. (Ferrer v. NLRC,
G.R. No. 100898, July 5, 1993) (1999 Bar
Question)
Q: What are the requirements for a valid
termination by the Er of the services of an
Ee pursuant to a union or closed-shop
agreement?
A:
1. The agreement must be expressedin
a clear and unequivocal way so as
not to leave room for interpretation
because it is a limitation to the
exercise of the right to self
organization.
2. Any doubt must be resolved against
the existence of a closed-shop
agreement.
3. The agreement can only have
prospective applicationandcannot be
applied retroactively.
4. It can only be exercised by giving the
Eehis right to due process
a. The Er has the right to satisfy
himself that there are sufficient
bases for the request of the
union
b. The termination of the services of
the Ee is not automatic uponthe
request of the union.
5. It cannot be applied to Ees who are
already members of the rival union or
to the Ees based on their religious
belief.
....,..,....... ~ ". ~ ..
Academics Committee
Vi ce Chai r for .Acader mcs: J eannie A.Laurentino
Vi ce-Char j or Admi n &F i l l al l ce: Aissa CelineH.Luna
Vi ce-Chai r j or L r yout &Desi gl l : Loise'RaeG.Naval
Labor LawCommittee
Members:
Mana Kristina L.Dacayo-Garcia
ChristianNinoA Diaz
,\ngelo S.Diokno
Genesis R.Fulgencio
J eanelleCLee
J emuel PaoloM.Lobo
Andrew W.Montesa
Mana Maica Angelika Roman
UNIVERSITY OF SANTO TOMAS ~".... ~ 03
Pacu(tar I r I e (] )er ecno Ci vi C ~. '7
LABOR RELATIONS: LABOR ORGANIZATIONS
~," L~BORORGANIZATIONS "
Q: What is a labor organization (LO)?
A: It is any union or association of Ees which
exists in whole or in part for the purpose of
collective bargaining (CB) or of dealing with
Ers concerning terms and conditions of
employment. (Art.212{gJ)
Any union or association of Ees in the private
sector which exist in whole or in part for the
purpose of CB, mutual aid, interest,
cooperation, protection or other lawful
purposes. (Sec.1{ce), Rule 1, Book V,
Omnibus Rules)
Q: What is a legitimate labor organization
(LLO)?
A: Any LO in the private sector registered or
reported with the DOLE. (Sec.1[ee), Rule I,
Book V, IRR)
The term includes a local/chapter of the
Bureau of Labor Relations directly chartered
by a legitimate federation or national union
which has been duly reported to the DOLE in
accordance with Sec. 2, Rule VI, Book V, IRR
of LG.
Note: Not every LLO can act as bargaining
representative and be certified as such. This is
true only of a union that has won in certification
election or has been voluntarily recognized by the
employer.
Q: What is a company union?
A: It is any LO whose formation, function or
administration has been assisted by any act
defined as unfair labor practice under the LC.
Q: What are the classifications of LOs?
A:
1. Union - Any LO in the private sector
organized for collective bargaining
(CB) and for other legitimate
purposes. (Sec. 1 [zz), Rule 1, Book
V,IRR)
2. Independent union Any LO
operating at the enterprise level
whose legal personality is derived
through an independent action for
registration with the Bureau of Labor
Relations (BLR) of DOLE prescribed
under Art.234. (Sec. 1 [w), Rule 1,
Book V, IRR)
3. National union/federation - Any LO
with at least 10 locals/chapters or
94
affiliates each of which must be a
duly certified or recognized CB agent.
- A group of labor unions in a private
establishment organized for CB or for
dealing with Er concerning terms and
conditions of employment for their
member unions or for participating in
the formulation of social and
employment policies, standards and
programs, registered with the BLR in
accordance with the implementing
rules. (Sec. 1 [kk), Rule 1, Book V,
Omnibus Rules)
4. Affiliate - An independent union
affiliated with a federation, national
union, or a chartered local which was
subsequently granted independent
registration but did not disaffiliate
from its federation, reported to the
Regional Office (RO) and the BLR in
accordance with this Rules. (Sec. 1
[a), Rule 1, Book V, IRR)
5. Chartered local - A LO in the private
sector operating at the enterprise
level that acquired legal personality
through the issuance of a charter
certificate by a duly registered
federation or national union, and
reported to the RO. (Sec. 1[i], Rule I,
Book V, IRR)
6. Industry union - Any group of LLO
operating within an identified industry,
organized for CB or for dealing with
Ers concerning terms and conditions
of employment within an industry or
for participating in the formulation of
social and employment policies,
standards, and programs in such
industry registered with DOLE.
7. Legitimate worker's association - An
association of workers organized for
the mutual aid and protection of its
members or for any purpose other
than CB registered with the DOLE.
(Sec. 1(ft], Rule 1, Book V, IRR)
8. Trade union center - Means any
group of registered national unions or
federations organized for the mutual
aid and protection of its members, for
assisting such members in CB or for
participating in the formulation of
social and employment policies,
standards and programs duly
registered with the DOLE. (SMCEU v.
San Miguel Packaging Products Ees
Union, G.R. 171153, Sep. 12, 2007)
9. Worker's association - An association
of workers organized for mutual aid
and protection of its members for any
legitimate purpose other than CB.
;-ART. 231. REGISTRY OF UNIONS AND fiLE
r: " OF ~OLtECTIVE,B~RGAINING . '
L' . " .~~.' AGREEMENTS' , ; "
Q: What is the nature of a CBA?
o
A: It is more than a contract; it is highly
impressed with public interest for it is an
essential instrument to promote industrial
peace. (TUP v. Laguesma, G.R. No. 95013,
Sep.21, 1994)
Q: When, where and how is a CBA
registered?
A:
1. The parties shall submit, within 30
days from execution, copies of the
CBA directly to the Bureau of Labor
Relations (BLR) or Regional Offices
(RO) of the DOLE. it must be
accompanied by the ff:
a. Verified proof of posting in 2
conspicuous places in the place
of work;
b. Verified proof of ratification by
the majority of all workers in the
bargaining unit.
2. Action upon the application for
registration within 5 calendar days
from receipt thereof.
3. The RO shall furnish the BLR with a
copy of the CBA within 5 days from
its submission.
4. The BLR or RO shall assess the Er
for every CBA. A registration fee of
not less than P1,000.00 or any
amount deemed appropriate by the
Secretary of Labor.
5. Issuance of certificate of registration.
Q: Is registration required for the validity of
the CBA?
A: No. The certification of the CBA by the BLR
is not required to put a stamp of validity to
such contract. Once it is duly entered into and
signed by the parties, the CBA becomes
effective as between the parties regardless of
whether or not the same has been certified by
the BLR. (Liberty Flour Mills Ees v. Liberty
Flour Mills Inc., G.R. Nos. 58768-70, Dec. 29,
1989)
'. ART. 234. REQUIREMENIS OF "
~',;' REGISTRATION'" '.'
- - _. ~ -
Q: Is registration of a labor organization
necessary?
A: No. A La may be registered or not.
Q: What is the purpose of registration?
A: Registration with the BLR is the operative
act that gives rights to a labor organization
(La).
1. It is the fact of being registered with
the DOLE that makes a La legitimate
in the sense that it is clothed with
legal personality to claim
representational and bargaining rights
enumerated in Art. 242 or to strike or
picket under Art. 263.
Note: A union having been validly
issued a certificate of registration
should be considered to have already
acquired juridical personality which may
not be assailed collaterally. (THIGCI v.
THEU-PGTWO, G.R. No. 142000, Jan.
2. The req't of registration is not the
curtailment of the right to association.
It is merely a condition sine qua non
for the acquisition of legal personality
Las, associations or unions and the
possession of the rights and
privileges granted by law to Las.
3. It is a valid exercise of police power
since the activities in which Las,
associations, or. unions of workers are
engaged affect public interest.
(PAFLU v. Sec. of Labor, G.R. No. L-
22228, Feb. 27, 1969)
Q: What is the effect if a LO is not
registered?
A: A La is not "illegitimate" just because it is
unregistered. It is still a lawful organization and
can deal with the Er, but it has no legal
personality to demand CB with the Er. It
cannot petition for a certification election and
cannot hold a legal strike.
If'acu(taa ae !Derecfio CiviC
Q: What are the req'ts for the issuance of
the certificate of registration of a national
federation, national union or industry or
trade union center or an independent
union?
A:
1. P 50.00 registration fee
2. Names of its officers, their addresses,
the principal address of the LO, the
minutes of the meeting of the
organizational meetings and the list of
the workers who participated in such
meetings
3. In case the applicant is an
independent union, the names of all
the Ees in the bargaining unit where it
seeks to operate
4. If the applicant union has been in
existence for one or more years,
copies of its annual financial reports
and
5. 4 copies of the constitution and by-
laws of the applicant union, minutes
of its adoption or ratification and the
list of the members who participated
in it. (Sec. 1, R.A. 9481)
, ART. 234-A. CHARTERING AND CREATION
. OF A LOCAL CHAPTER
(as Inserted by R.A. 9481)
Q: How is a local chapter created?
A: A duly registered federation or national
union may directly create a local/ chapter by
issuing a charter certificate indicating the
establishment of a local/chapter.
1. The' chapter shall acquire legal
personality only for purposes of filing
a petition for certification election
from the date it was issued a charter
certificate
2. The chapter shall be entitled to all
other rights and privileges of a
legitimate labor organization (LLO)
only upon the submission of the
following documents in addition to its
charter certificate:
a. Names of the chapter's officers,
their addresses, and the principal
office of the chapter
b. Chapter's constitution and by-
laws
c. Where the chapter's constitution
and by-laws are the same as that
of the federation or the national
union, this fact shall be indicated
accordingly
3. The genuineness and due execution
of the supporting requirements shall
be:
a. Certified under oath by the
secretary or treasurer of the
local/chapter, and
b. Attested to by its president.
(Sec.2{e), Rule 11/,Book V, IRR,
as amended by D. O. 40-F-03)
Note: Under the LC and the rules, the power
granted to LOs to directly create a chapter or
local through chartering is given to a federation or
national union only, not to a trade union center.
(SMCEU v. San Miguel Packaging Products Ees
Union, G.R. No. 171153, Sep. 12,2007)
Q: Where is the application for registration
filed',?
A:
1. Independent labor unions, chartered
locals or worker's associations - It is
filed with the Regional Office (RO).
where the applicant principally
operates. It shall be processed by the
Labor Relations Division at the RO.
2. Federations, national unions or
worker'S association operating in
more than one region - It is filed with
the BLR of the RO, but shall be
processed by the BLR.
Q: What is the duty of the BLR after a LO
had filed the necessary papers and
documents for registration?
A: It becomes mandatory for the BLR to check
if the req'ts under Art. 234 of the LC have been
sedulously complied with. If its application for
registration is vitiated by falsification and
serious irregularities, especially those
appearing on the face of the application and
the supporting documents, a LO should be
denied recognition as a LLO. (Progressive
Dev't Corp.-Pizza Hut v. Laguesma, et.a/.,
G.R. No. 115077, April 18, 1997)
Q: Within what period should the BLR act
on the applications submitted before it?
A: It shall act on all applications for registration
within 10m days from receipt either by:
1. Approving the application and issuing
the certificate of
registration/acknowledging the
notice/report; or
2. Denying the application/notice for
failure of the applicant to comply with
the requirements for
registration/notice (D. O. 40-03, Rule
IV, Sec.4, series of 2003)
A: The application for registration of
federations and national unions shall be
accompanied by the following documents:
1. A statement indicating the name of
the applicant labor union, its principal
address, the name of its officers and
their respective addresses;
2. The minutes of the organizational
meeting(s) and the list of Ees who
participated in the said meeting(s);
3. The annual financial reports if the
applicant union has been in existence
for 1 or more years, unless it has not
collected any amount from the
members, in which case a statement
to this effect shall be included in the
application;
4. The applicant union's constitution and
by-laws, minutes of its adoption or
ratification, and the list of the
members who participated in it. The
list of ratifying members shall be
dispensed with where the constitution
and by-laws was ratified or adopted
during the organizational meeting(s).
In such a case, the factual
circumstances of the ratification shall
be recorded in the minutes of the
organizational meeting(s);
5. The resolution of affiliation of at least
10 LLOs, whether independent
unions or chartered locals, each of
which must be a duly certified or XPN: Even before the onset of the freedom
recognized bargaining agent in the period, disaffiliation may still, be carried out,
UNIVERSITY OF SANTO TOMAS ~~. 97
Pacu{ taa ae CDer ecno CiviC 9
Note: All requisite documents shall be:
1. Certified under oath by the secretary or
treasurer of the organization, as the
case may be and
2. Attested to it by its President.
Q: May the BLR review the issuance of a
certificate of registration?
A: No. The SLR has the duty to review the
application for registration not the issuance of
a certificate of registration.
Q: Why is a lesser requirement imposed for
a chartered local?
A: The intent of the law in imposing lesser
req'ts in the case of branch or local of a
registered federation or national union is to
encourage the affiliation of a local union in
order to increase the local union's bargaining
power respecting terms and conditions of
labor. (Progressive Dev't Corp v. SLE, G.R.
No. 96425, Feb. 4, 1992)
Q: What are the req'ts before a federation
can be issued a certificate of registration?
establishment where it seeks to
operate; and
6. The name and addresses of the
companies where the affiliates
operate and the list of all the
members in each company involved.
(D. O. 40-03, Rule, III, Sec. 2-8,
series of 2003)
Q: What are the requirements for
affiliation?
A: The report of affiliation of independently
registered labor unions with a federation or
national union shall be accompanied by the
following documents: .
1. Resolution of the labor union's board
of directors approving the affiliation;
2. Minutes of the general membership
meeting approving the affiliation;
3. The total number of members
comprising the labor union and the
names of members who approved the
affiliation;
4. The certificate of affiliation issued by
the federation in favor of the
independently registered labor union;
and
5. Written notice to the employer
concerned if the affiliating union is the
incumbent bargaining agent. (D.O.
40-03, Rule, III, Sec. 7, series of
2003)
Q: What is the effect of affiliation?
A: The labor union that affiliates with a
federation is subject to the laws of the parent
body under whose authority the local union
functions. The constitution, by-laws and rules
of the mother federation, together with the
charter it issues to the local union, constitutes
an enforceable contract between them and
between the members of the subordinate
union inter se. Thus, pursuant to the
constitution and by-laws, the federation has
the right to investigate and expel members of
the local union. (Villar v. Inciong, G.R. No. L-
50283-84, April 20, 1983)
Q: Maya local union disaffiliate from the
federation?
A:
GR: A labor union may disaffiliate from the
mother union to form an independent union
only during the 60-day freedom period
immediately preceding the expiration of the
CSA.
but such disaffiliation must be effected by
the majority of the union members in the
bargaining unit.
Note: This happens when there is a
substantial shift in allegiance on the part of
the majority of the members of the union. In
such a case, however, the CSA continues to
bind the members of the new or disaffiliated
and independent union up to determine the
union which shall administer the CSA may be
conducted. (ANGLO-KMU v. Samahan ng
Manggagawang Nagkakaisa sa Manila Bay
Spinning Mills at J.P. Coats, G. R. No.118562,
July 5, 1996)
Q: What is the limitation to disaffiliation?
A: Disaffiliation should be in accordance with
the rules and procedures stated in the
constitution and by-laws of the federation. A
local union may disaffiliate with its mother
federation provided that there is no
enforceable provision in the federation's
constitution preventing disaffiliation of a local
union. (Tropical Hut Ees Union v. Tropical Hut,
G.R. Nos. L-43495-99, Jan. 20, 1990)
Note: A prohibition to disaffiliate in the
Federation's constitution and by-laws is valid
because it is intended for its own protection.
Q: What is the effect of cancellation of
registration of a federation or a national
union?
A:
GR: It shall operate to divest its
locals/chapters of their status as LLO.
XPN: Locals/chapters retain status as LLO
if they arecovered by a duly registered
CSA.
Note Locals or chapters who retained status
as LLO shall be allowed to register as
independent unions. If they fail to register,
they shall lose their legitimate status upon the
expiration of the CSA.
Q: PSEA is a local union in Skylander
company which is affiliated with PAFLU.
PSEA won the certification election among
the rank and file Ees of the Skylander
company but its rival union PSEA-WATU
protested the results. Pending the
resolution of such controversy, PSEA
disaffiliated with PAFLU and hence
affiliated with NeW which was supported
by its members. May a local union
disaffiliate with its mother federation
per1ding the settlement of the status as the
sole and exclusive bargaining agent?
98
A: Yes. The pendency of an election protest
does not bar the valid disaffiliation of the local
union which was supported by the majority of
its members.
The right of a local union to disaffiliate with the
federation in the absence of any stipulation in
the constitution and by-laws of the federation
prohibiting disaffiliation is well settled. Local
unions remain as the basic unit of association,
free to serve their own interest subject to the
restraints imposed by the constitution and by-
laws of national federation and are free to
renounce such affiliation upon the terms and
conditions laid down in the agreement which
brought such affiliation to existence. In the
case at bar, no prohibition existed under the
constitution and by-laws of the federation.
Hence, the union may freely disaffiliate with
the federation. (Philippine Sky/anders v.
NLRC, G.R. No. 127374, Jan. 31, 2002)
Q: Distinguish between an independently
registered and unregistered chartered local
union.
A:
: CHARTERED LOCAL UNION
: Independently U t d
l Registered nreqrs ere
~
By signing contract of
affiliation
By application of with
the federation for the
issuance of a charter
certificate to be
submitted to the BLR
i i i !;'!~f1tl~~OfDisalfiliittlti1i'tq!fhff:~U.ftIQ.ri.:(IQc" aJ),.
Would cease to be
LLO and would no
longer have the legal
personality and the
rights and privileges
granted by lawto LLO,
unless the local
chapter is covered by
its duly registered
CBA.
' /' ;" i i ' f~c}fE" ff.ectofrti$~fffU.atio'i.to:th~CBll '. .' !
The CSA would
Would not affect its
being a LLO and
therefore it would
continue to have legal
personality and to
posses all rights and
privileges of LLO.
An existing CBA would
continue to be valid as
the LO can continue
administering then
CBA.
continue to be valid.
The local chapter will
not lose its personality,
unless it registers a
new.
!h,:EJititl~mljn.fZtp.\;('iiltQ" aiiei;ilf1'ef;;)1$~ffi(iiltioH. ...
Union dues may no
longer be collected as
there would no longer
be any labor union that
is allowed to collect
such union dues from
the Ees.
LO entitled to the union
dues and not the
federation from which
the LO disaffiliated.
~ART. 236. DENIAL OF REGISTRATION
Q: What is the form of the decision of the
denial of application for registration?
A: It shall be:
1. In writing;
2. Stating in clear terms the reason for
the decision; and
3. Applicant union must be furnished a
copy of said decision.
<0 ...
Q: Is the denial of registration appealable?
A: Yes.
1. Decisions of the Regional Office shall
be appealable to the BLR and CA.
2. The BLR's decisions on cases
appealed from Regional Director are
final and not appealable to the SLE.
3. Decisions of the BLR denying the
registration of a LO (federation or
national union) is appealable to the
SLE within 10 days from receipt of
the decision, on grounds of:
a. Grave abuse of discretion; or
b. Gross incompetence.
4. Decision of SLE appealable to CA.
Q: How is appeal taken with regard to
denial or cancellation of registration?
SLE decides on the
matter within 20 days
from receipt of records
Note: Appeal is by memo of appeal within 10
days from receipt of notice.
ART. 238. CANCELLATION OF
REGISTRATION
Q: Who cancels the certificate of
registration?
A: The certificate of registration of any LLO,
whether national or local, may be cancelled by
the BLR, after due hearing, only on the
grounds specified in Art. 239. (as amended by
R.A. 9481)
ART. 238-A. -EFFECT OF A PETITION" FOR
. CANCELLATION OF REGISTRATION
Q: What is the effect of a petition for
cancellation or of union registration?
A: It shall not suspend the proceedings for
certification election (CE) nor shall it prevent
the filing of CEo
In case of cancellation, nothing herein shall
restrict the right of the union to seek just and
equitable remedies in the appropriate courts.
Q: Where is a petition for cancellation of
registration or application for voluntary
dissolution filed?
A:
1. For legitimate independent labor
unions, local/chapter and worker's
association - It shall be filed with the
Regional Office which issued its
certificate of registration or creation.
2. For federations, national or industry
and trade union centers - It shall be
filed with the BLR. (Sec. 1, Rule XIV,
Book V, IRR as amended by 0.0.40-
F-03)
Q: Who may file a petition for cancellation
of registration?
A:
1. For legitimate individual labor union,
chartered local and worker's
association - Any party-in-interest
may file a petition for cancellation of
registration if the ground is:
a. Failure to comply with any of the
req'ts under Art. 234, 237 and
238 of the LC.
b. Violation of any provision under
Art. 239, LC.
2. For federations, national or industry
unions, trade union centers - Only
members of the labor organization
(LO) concerned may file if the
grounds are actions involving
violations of Art. 241, subject to the
30% rule.
Q: What is the effect of cancellation of
registration if the cancellation is made in
the course of the proceedings?
A: Where a labor union is a party in a
proceeding and later it loses its registration
permit in the course or during the pendency of
the case, such union may continue as party
UN I V E R SIT Y 0 F 5 ANT 0 TOM A S ~~ 99
PacuCtaa ae (] )er ecno Ci vi C .
without need of substitution of parties, subject
however to the understanding that whatever
decision may be rendered will be binding only
upon those members of the union who have
not signified their desire to withdraw from the
case before its trial and decision on the merits.
Note: Rationale: Principle of agency is applied -
the Ees are the principals, and the LO is merely
an agent of the former, consequently, the
cancellation of the union's registration would not
deprive the consenting member-Ees of their right
to continue the case as they are considered as
the principals.
i ART. 239. GROUNDS FOR CANCELLATION
; OF UNION REGISTRATION ' "
Q: What are the grounds for cancellation of
union registration?
A:
1. Misrepresentation, false statement or
fraud in connection with the:
a. Adoption or application of the
constitution and' by-laws or
amendments thereto
b. Minutes of ratification and
c. List of members who took part in
the ratification;
d. Election of officers
e. Minutes of the election of officers
and
f. List of voters (Art. 239 as
amended)
2. Voluntary
members.
9481)
dissolution by the
(as amended by R.A.
Note: A pronouncement as to the legality of the
strike is not within the meaning of Art. 239 of the
LC.
Q: What are the prohibited grounds for
cancellation of union registration?
A:
1. The inclusion as union member of
Ees who are outside the bargaining
unit shall not be a ground to cancel
the union registration. The ineligible
Ees are automatically deemd
removed from the list of membership
of the union as. (Art. 245-A as
amended by RA 9481)
2. The affiliation of the rank-and-file and
supervisory unions operating within
the same establishment to the same
federation or national union shall not
100
be a ground to cancel registration of
either union. (Sec. 6, Rule XIV, Book
V, as inserted by D. O. 40-F-03)
t_ ART.239-A. VOLUN"A~y.CA~CELLATION :,
~"",',. ".,' .- ~'';.OERE~I,Sl:~TleN '/..'" ".:' .' . :'"'i~
Q: How is voluntary cancellation of
registration made?
A: Registration may be cancelled by the
organization itself provided:
1. At least % of its general membership
votes todissolve the organization, in
a meeting duly called for that
purpose; and
2. An application to cancel registration is
thereafter submitted by the' board of
the organization, attested by its
president.
Q: What are the "reportorial requirements"
required to be submitted by a legitimate
labor organization (LLO) ?
A: The following documents are required to be
submitted to BLR by the Ll.O concerned:
1. Within 30 days from adoption or
ratification of the constitution and by
laws (CBl) or amendments thereto:
a. CBl or amendments thereto
b. Minutes of ratification
c. List of members who took part in
the ratification of the constitution
and by-laws;
2. Within 30 days from date of election
or appointment:
a. List of elected and appointed
officers and agents entrusted
with the handing of union funds
b. Minutes of election of officers
c. List of voters
3. Annual financial report within 30 days
after the close of every fiscal year
4. List of members at least once a year
or whenever required by the Bureau.
(Sec. 1, Rule V, Book V, IRR, as
amended by D.O. 40-F-03)
Note: Failure to submit reportorial requirements
is no longer a ground for cancellation but shall
subject the erring officers or members to
suspension, expulsion from membership, or any
appropriate penalty (Art. 242-A, as inserted by
R.A. 9481).
ART. 241. RIGHTS AND CONDITIONS OF
. MEMBERSHIP IN A LABOR
: ORGANIZATION
Q: What is the nature of the relationship
between the union and its members?
A: It is fiduciary in nature, and arises out of 2
factors:
1.
2.
Degree of dependence of the
individual Ee on the union
organizatien and ~ ~
The comprehensive power vested in
the union to the individual.
Q: What are the rights and conditions of
membership in a labor organization (LO)?
A:
1. Political right
a. Right to vote
b. Right to be voted for
Note: Both are subject to lawful
provisions on qualifications and
disqualificatiens
2. Deliberative and decision-making
right
a. Right to' participate in
deliberations on major policy
questions
b. Right to decide on such major
policy questions by secret ballet
3. Rights over money matters
a. Right against:
i. Excessive fees
ii. Unauthorized collection
iii. Unauthorized disbursements
b. Right to:
i, Require adequate records of
income and expenses
ii. Access financial records
iii. Vote on officer's
compensation
iv. Vote on proposed special
assessments
v. Deduction of special
assessments only with
written authorization from
member
4. Right to information - Right to be
informed about the organization's
constitution and by-laws and the CSA
and about labor laws
5. Other rights and conditions under Art.
241
a. LOs cannot knowingly admit or
continue in membership any
individual who belongs to a
subversive organization er
engaged directly or indirectly in
any subversive activity
b. A member who has been
convicted for a crime of moral
turpitude (by final judgment) is
ineligible fer election or
appointment in the union
c. Every payment of fees, dues or
other contributions by a member
shall be evidenced by a receipt
signed by the officer and entered
into the record of the
erganization
d. Every income shall be evidenced
by a record shewing its source.
Every expenditure shall be
evidenced by a receipt from the
person who was paid. The
receipt shall state the date, place
and purpose of such payment.
Q: When, how and under what conditions
does an Ee become a union member?
A: It depends on the constitution and by-laws
inasmuch as Art.249 gives a LO the right to
prescribe its own rules for acquisition or
retention of membership.
The relationship of the union and members is
governed by their mutual agreement, terms
and conditions of which are set forth in the
union's constitution and by-laws and binding
on the members as well as the organization
itself. (Oca v. Trajano, G.R. No. 76189, Aug. 8,
1991)
Note: An Ee, whether employed for a definite
period or not, shall beginning on his first day of
service, be considered an Ee for purposes of
union membership. (Art. 277)
Q: How are union officers elected?
A: They are elected directly by the members
through secret balloting. Election takes place
at intervals of 5 years which is the term of
office of the union officers including these of a
national union, federation or a trade union
center.
Note: What positions to fill up, where and how
the election should be done are matters left by
law to the union's constitution and by-laws or to
agreement among the members. Only in the
absence thereof will the IRR of Book V apply.
Pacu{ tati ti e cJ)er ecno CiviC
~~ 101
Q: Who takes part in the election of union
officers?
A: Only members of the union can take part in
the election of union officers. (Art. 241{c])
Q: Who is a member in good standing?
A: Any person who has:
1. Fulfilled the req'ts for membership in
the union, and
2. Not voluntarily withdrawn from
membership or
3. Not been expelled or suspended from
membership after appropriate
proceedings consistent with the lawful
provisions of the union's constitution
and by-laws.
Q: What may be used to determine
eligibility to vote?
A: The question of eligibility to vote may be
determined through the use of the applicable
payroll period and Ee's status during the
applicable period - the payroll of the month
next preceding the labor dispute in case of
regular Ees and the payroll at or near the peak
of operations in case of Ees in seasonal
industries. (Tancinco v. Pura Ferrer-Calleja,
G.R. No. 78131, Jan. 20, 1988)
Note: If none of the contending unions insisted
on the use of the payroll period-list as voting list,
the act of the non-union Ees of joining the
election by casting their votes is a clear
manifestation of their intention to join a union.
They must therefore be considered ipso facto
union members. Said Ees having exercised their
right to unionism, by joining one of the unions,
their decision is paramount. (Tancinco v, Pura
Ferrer-Calleja, G.R. No. 78131, Jan. 20, 1988)
Q: Is it necessary that a union officer be an
Ee?
A: Yes. No qualification req'ts for candidacy to
any position shall be imposed other than
membership in good standing in subject LO.
(Art. 241{c], 2" d sentence)
Q: What are the limitations in memberships
in unions?
A:
1. The LO cannot compel Ees to
become members of the LO if they
are already members of a rival union.
2. The persons enumerated under Art.
241 (e) of the LC are prohibited from
becoming members of a LO.
3. The members of of religious
organizations whose religion forbids
102
membership in LOs cannot be
compelled into union membership.
Q: Who are those disqualified to be a union
officer?
A:
1. Person who has been convicted of a
crime involving moral turpitude. (Art.
241[f])
2. Any individual who belongs to a
subversive organization or who is
engaged indirectly or indirectly in any
subversive activity. (Art. 241{e])
3. Non-employees. (Art. 241{c])
Q: Wh,at is a union election protest?
A: It is a complaint or protest regarding
election of union officers and is treated as an
inter/intra-union dispute,
Q: What are union dues?
A: These are regular monthly contributions
paid by the members to the union in exchange
for the benefits given to them by the CSA and
to finance the activities of the union in
representing the union.
Q: What is check-off?
A: It is a method of deducting from an Ee's
pay at a prescribed period, the amounts due
the union for fees, fines and assessments.
Deductions for union service fees are
authorized by law and do not require individual
check-off authorizations.
Q: What is the nature and purpose of
check-off?
A: Union dues are the lifeblood of the union.
All unions are authorized to collect reasonable
membership fees, union dues, assessments
and fines and other contributions for labor
education and research, mutual death and
hospitalization benefits, welfare fund, strike
fund and credit and cooperative
undertakings. (Art. 277[a])
Q: What are the requisites of a valid check-
off?
A:
GR: No special assessments, atty's fees,
negotiation fees or any other extraordinary
fees may be checked off from any amount
due to an employee (Ee) without individual
written authorization duly signed by the Ee.
The authorization
the:
1.
2.
3.
should specifically state
Amount
Purpose &
Beneficiary of the deduction.
XPN:
1. For mandatory activities under the LC
2. For agency fees
3. When non-members of the union
avail of the benefits of the CBA:
a. Non-members may be assessed
union dues equivalent to that
paid by union members;
b. Only by board resolution
approved by majority of the
members in general meeting
called for the purpose.
Q: What is an agency fee?
A: It is an amount equivalent to union dues,
which a non-union member pays to the union
because he benefits from the CBA negotiated
by the union.
Note: Agency fee cannot be imposed on Ees
already in the service and are members of
another union. If a closed shop agreement cannot
be applied to them, neither mayan agency fee,
as a lesser form of union security, be imposed to
them. Payment by non-union members of agency
fees does not amount to an unjust enrichment
basically the purpose of such dues is to avoid
discrimination between union and non-union
members.
Q: Distinguish union dues from agency
fees.
A:
UnionDues Agency Fee
Is deducted from non-
members of the
bargaining agent
(union) for the
enjoyment of the
benefits under the
CSA.
Is deducted from
members for the
payment of union dues
May be deducted from
the salary of the Ees
without their written
consent.
May not be deducted
fromthe salaries of the
union members
without the written
I consent of the workers
affected.
Q: What are special assessments or
extraordinary fees?
A: These are assessments for any purpose or
object other than those expressly provided by
the labor organization's constitution and by-
laws.
Q: What are the requisites for a valid levy
of special assessment or extraordinary
fees?
A:
1. Authorization by a written resolution
of the majority of all members at the
general membership meeting duly
called for that purpose;
2. Secretary's record of the minutes of
the meeting, which must include the:
a. List of members present
b. Votes cast
c. Purpose of the special
assessments
d. Recipient of such assessments;
3. Individual written authorization to
check-off duly signed by the Ee
concerned to levy such
assessments.
Q: What is the effect of failure to strictly
comply the req'ts set by law?
A: It shall invalidate the questioned special
assessments. Substantial compliance of the
requirements is not enough in view of the fact
that the special assessment will diminish the
compensation of union members. (Palacol v.
Ferrer-Calleja, GR. No. 85333, Feb. 26, 1990)
Q: Who has jurisdiction over check-off
disputes?
A: Being an intra-union dispute, the Regional
Director of DOLE has jurisdiction over check
off disputes.
UNIVERSiTY OF SANTO TOMAS (..<.1.'. 103
Pacu{ taa ae (] )er ec/i o Civi] .~.
Q: Distinguish check-off from special
assessments.
A:
(Union Dues)
By obtaining the individual written
authorization duly signed by the
Ee which must specify:
1.Amount
2.Purpose
3.Beneficiary
By written
resolution
approved by
majority of all
the members
at the
meeting
called for
that e.
(Agency fees)
Not necessary when:
1. For mandatory activities under
the LC
2. For agency fees
3. When non-members of the
union avail of the benefits of
the CBA:
a. Said non-members may be
assessed union dues
equivalent to that paid by
union members;
b. Only by Board resolution
approved by majority of the
members in general meeting
called for the
No
exception;
written
resolution is
mandatory in
all instances.
Note: Individual written authorization is not
necessary for the collection of agency fees.
Q: Are Ees who are members of another
union considered free riders?
A: No. When the union bids to become the
bargaining agent, it voluntarily assumes the
responsibility of representing all the Ees.
: REMEDIES FOR VIOLATIONS.OF RIGHTS
Q: Who reports complaint for violation
rights of union members?
A:
GR: Complaint for violation of right must be
reported by at least 30% of the union
members.
XPN: When the violation directly affects
only one or two members, then only one or
two members can report such violation.
Q: What is the consequence of violation of
such rights?
A: Expulsion of the culpable officers.
Q: What are the remedies for violation of
rights and conditions of membership?
A: As to impeachment of a union officer, as
per reference to the union's constitution and
by-laws (CBL):
1. Impeachment must be initiated by a
petition Signed by at least 30% of all
bona fide members of the union and
addressed to the chairman of the
Executive Board;
2. A general membership meeting shall
be convened by the Board Chairman
to consider the impeachment of an
officer;
~. Before the impeachment is finally
taken, the union officer against whom
the impeachment charges have been
filed shall be given ample opportunity
to defend himself; and
4. A majority of all members of the union
shall be required to impeach or recall
union officers.
Note: Despite the practical difficulties in
complying with the procedure, petitioners should
show substantial compliance' with said
impeachment procedure, by giving the union
officer ample opportunity to defend himself, as
contrasted to an outright impeachment, right after
he failed to appear before the first and only
investigation scheduled. (Litton Mills Ee's Ass'n-
Kapatiran v. Ferrer-Calleja, GR. No. L-78061,
Nov. 24, 1988)
Q: Is the 30% support of union membership
mandatory for filing of a complaint
regarding a violation of the rights and
conditions of membership?
A: No. The fact that the word "may" was used
in the LC negates the presumption that such is
mandatory. It clearly shows that the said req't
is permissive in nature. (Rodriguez v. Director
of BLR, G.R. Nos. L-76579-82, Aug. 31, 1988)
. ART. 242. RIGHTS OF LEGITIMATE
, LABOR ORGANIZATIONS _
Q: What are the rights of legitimate labor
organizations (LLOs)?
A: A LLO shall have the right to:
1. Act as the exclusive representatives
of its members
2. Represent union members
3. Be furnished by the Er with its annual
audited financial statements
4. Own properties
5. Sue and be sued in its registered
name
6. Undertake all other activities for the
benefit of members
7. Be exempted from taxes
Q: When will the financial statements be
giventothe union?
A:
1. After the union has been recognized
by the Er as the sole bargaining
representative of the Ees in the
bargaining unit
2. After the union is certified by DOLE
as such sale bargaining
representative.
3. Written request from the union
4. Within the last 60 days of the life of a
CBA.
5. During the collective bargaining
negotiation
Q: Dounions havethe right tocollect fees?
A: Yes, the right to collect fees is recognized
in Art. 277(a) and discussed under Art. 241 of
the LC.
Q: J erry Acedera and his co-Ees works for
ICTSI and are officers! members of
APCWU-ICTSI.ICTSI entered into a CBA
with APCWU.CBA reduced Ees' work days
per yr from 304days to 250days. However
ICTSI continued using the 304-day. Later.
RTWPBdecreed a daily wage Increasefor
all workers but ICTSI did not comply and
used 365days as the divisor for Ees' rate
of pay. APCWU filed with the LA a
complaint against ICTSI while J erry
Acederaand his co-Ees filed with the LA a
Complaint-in-Intervention with Motion to
Intervene. They wanted to insure by their
intervention that the case would thereafter
be prosecuted with all due diligence and
would not again be dismissed for lack of
interest to prosecute on the part of the
union. The LA denied it. Can the Ees
interveneinthe case?
A: No. A labor union is the party authorized to
represent its members under Art. 242(a) of the
LC which provides that a union may act as the
representative of its members for the purpose
of CB. This authority includes the power to
represent its members for the purpose of
enforcing the provisions of the CBA. That
APCWU acted in a representative capacity "for
and in behalf of its union members and other
Ees similarly situated," the title of the case filed
by it at the LA's Office so expressly
states. While a party acting in a rep. capacity,
such as a union, may be permitted to intervene
in a case, ordinarily, a person whose interests
are already represented will not be permitted
to do the same except when there is a
suggestion of fraud or collusion or that the rep.
will not act in GF for the protection of all
interests represented by him. Petitioners cite
the dismissal of the case filed by ICTSI, first by
the LA, and later by the CA. The dismissal of
the case does not, however, by itself show the
existence of fraud or collusion or a lack of GF
on the part of APCWU. (Jerry Acedera, et a/. v.
ICTS/, G.R. No. 146073, Jan. 13, 2003, J.
Carpio-Morales)
"'~.'~".~ ..
Academics Committee
Vi ce-Chai r Jor Admi n &F i nance: Aissa Cehne H.Luna
Vi ce-Chai r [ or L ayout &DeJi gn: LoiseRae G.Naval
Labor LawCommittee
Sui ?j eet H ead' Lester J ay AlanE.FloresII
Assi stant Suo/eet H ead' Domingo B.Diviva V
Members:
ChristianNinoA Diaz
AngeloS.Diokno
Genesis R Fulgencio
J eanelleC.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
Pacu[ taa ae l I Jer ecfzo CiviC
105
LABOR RELATIONS: UNFAIR LABOR PRACTICE
: UNFAIR LABOR PRACTICES (ULP)
I ART. 247. CONCEPT OF ULP AND
; PROCEDURE FOR PROSECUTION
k. ~' .. < THEREOF "0 ,,,~.
Q: What is the concept of ULP?
A: ULP are:
1. Criminal offenses against the State
2. Violations of civil rights of both labor
and management
3. Violates the constitutional rights of
workers and Ees to self-organization
4. Inimical to the legitimate interest of
both labor and management,
including their right to bargain
collectively and otherwise deal with
each other in an atmosphere of
freedom and mutual respect
5. Disrupt industrial peace
6. Hinder the promotion of healthy and
stable labor-management relations
and mutual respect (unstable labor-
management relations)
Note: Because self-organization is a prerequisite
of industrial democracy, the right to self-organize
has been enshrined in the Constitution, and any
attack to it - any act intended to defeat or
debilitate the right - is regarded by law as an
offense.
Q: What are the elements of ULP?
A:
1. Er-Ee relationship between the
offender and the offended party.
2. Act done is expressly defined in the
LC as an act of ULP.
Note: ULP is negation of the right to organize
which is available only to Ees in relation to their
Er. No organizational right can be negated or
assailed if the Er-Ee relationship is absent in the
first place.
The prohibited acts are all related to the workers'
self-organizational right and the observance of a
CBA, except Art. 248(f) - dismissing or
prejudicing an Ee for giving testimony under the
LC.
Q: Are all unfair acts considered as ULP?
A: No. Because ULP is and has to be related
to the right to self organization and to the
observance of the CBA, it follows that not
every unfair act is ULP.
Note: ULP refers only to acts opposed to
workers' right to organize. When committed by
the Er, it commonly connotes anti-unionism.
Q: Distinguish civil aspect from criminal
aspect of ULP?
A:
Agents
who partiCipated or
authorized or ratified
the act and agents,
repres entatives,
members of the gov't
board, including
",rt,n"'''' members
The officers and
agents of Er or LO
Labor Arbiter
Substantial evidence
1 year from the accrual
of ULP, however, it will
be suspended once the
administrative case has
been filed and would
only continue running
once the administrative
case has attained
finality.
1year fromthe accrual
of ULP. (Art. 290)
Note: Final judgment in the administrative
proceeding finding that ULP has been committed:
1. Is a prerequisite in filing a criminal case
of ULP.
2. Shall not be binding in the criminal case
nor shall be considered as an evidence
of guilt but merely as a proof of
compliance of the requirements
prescribed by the LC.
Q: Who is liable if ULP is committed by a
juridical person?
A: When committed by:
1. Corporation, trust, firm, partnership,
association or any other entity -
Penalty shall be imposed upon its
guilty officer or officers. (Art. 289)
2. Labor organization - Parties liable
are the officers of the governing
boards, representatives or agents or
members of labor associations or
organizations who have participated
in authorized or ratified such. (Art.
249)
Q: What are the ULP that may be
committed by Ers?
A:
1. Interference
2. Yellow dog condition
3. Contracting out
4. Company unionism
5. Discrimination for or against ,union
membership
6. Discrimination because of testimony
7. Violation of duty to bargain
8. Paid negotiation and
9. Gross violation of CBA
Q: What is meant by interference?
A: The act of Er to interfere with, restrain or
coerce Ees in the exercise of their right to self
organization.
Q: What is the test of interference?
A: Whether the Er has engaged in conduct
which, it may reasonably be said, tends to
interfere with the free exercise ofIhe Ees right
to self-organization.
Note: Direct evidence that an Ee was in fact
intended or coerced by the statements of threats
of the Er is not necessary if there is a reasonable
interference that the anti-union conduct of the Er
does have an adverse effect on self-organization
and CB. (The Insular Life Assurance-NA TU v.
The Insular Life Co. Ltd, G.R. No.L-25291, Jan.
30, 1971)
Q: What is the totality of conduct doctrine?
A: It states that the culpability of Er's remarks
is to be evaluated not only on the basis of their
implications, but against the background of
and in conjunction with collateral
circumstances.
Under this doctrine, expressions of opinion by
an Er, though innocent in themselves,
frequently were held to be ULP because of:
1. The circumstances under which they
were uttered
2. The history of the particular Er's labor
relations or anti-union bias
3. Their connection with an established
collateral plan of coercion or
interference. (The Insular Life
Assurance-NA TU v. The Insular Life
Co. Ltd, G.R. No.L-25291, Jan. 30,
1971)
Q: Phil. Marine Officers Guild (PMOG) is a
union representing some of Philsteam's
officers and Gebu Seamen's Association
(GSA) is another union representing some
of Philsteam's officers. PMOG sent a letter
to Phllsteam requesting for GS but the
company asked the former to first prove it
represents the majority. Simultaneously,
Philsteam interrogated its captains, deck
officers and engineers while GSA likewise
sent its demands to Philsteam. The
company recognized GSA as representing
the majority and entered into a GSA.
Hence PMOG declared a strike. PMOG was
subjected to vilification and Philsteam's
pier superintendent participated in the
solicitation of membership for GSA. Is the
company guilty of ULP?
A: Yes. Although the company is free to make
interrogations as to its Ees' union, the same
should be for a legitimate purpose and must
not interfere with the exercise of self-
organization otherwise it is considered as ULP.
Moreover, Philsteam's supervisory Ees'
statement that PMOG is a "money-making"
union, which is made to appear to be said in
behalf of the union and the participation of the
company's pier superintendent in soliciting
membership for the competing union, is ULP
for interfering with the exercise of the right to
self-organization. (Philsteam and Navigation v.
Philippine Marine Officers Guild, G.R. Nos. L-
20667 and L-20669, Oct. 29, 1965)
Q: What is a lockout?
A: It means any temporary refusal of an Er to
furnish work as a result of an industrial or labor
dispute. (Art.212[pJ)
Q: When does lockout or closure amount to
ULP?
A: A lockout, actual or threatened, as a means
of dissuading the Ees from exercising their
rights is clearly an ULP. However, to hold an
Er guilty, the evidence must establish that the
purpose was to interfere with the Ees exercise
of their rights.
Q: What are other examples of acts of
interference?
A:
1. Outright and unconcealed intimidation
2. In order that interrogation would not
be deemed coercive:
a. The Er must communicate to the
Ee the purpose of questioning
b. Assure him that no reprisal would
take place
c. Obtain Ee participation
voluntarily
tf' acu(taa ae 1)er ecno Ci 1i i C
~i~ 107
d. Must be free from Er hostility to
union organization
e. Must not be coercive in nature
3. Intimidating expressions of opinion by
Er
Note: An Er who interfered with the right to self-
organization before a union is registered can be
held guilty of ULP. (Samahan ng mga
Manggagawa sa Bandolino-LMLC v. NLRC, GR.
No. 125195, July 17,1997)
It is the prerogative of the company to promote,
transfer or even demote its Ees to other positions
when the interests of the company reasonably
demand it. Unless there are circumstances which
directly point to interference by the company with
the Ees right to self-organization, the transfer of
an Ee should be considered as within the bounds
allowed by law. (Rubberworld Phils. v. NLRC,
G.R. No. 75704, July 19, 1989)
Q: What is a yellow dog condition?
A: It is to require as a condition of employment
that a person or an Ee shall not join a labor
organization or shall withdraw from one to
which he belongs.
Q: What is ayellow dog contract?
A: It is a promise exacted from workers as
condition of employment that they are not to
belong to or attempt to foster a union during
their period of employment.
Q: Is yellow dog contract valid?
A: No. It is null and void because:
1. It is contrary to public policy for it is
tantamount to involuntary servitude.
2. It is entered into without consideration
for Ees in waiving their right to self-
organizatio n.
3. Ees are coerced to sign contracts
disadvantageous to their family.
Note: This is one of the cases of ULP that may
be committed in the absence of an Er-Ee
relationship.
Q: What are the 3 usual provisions under a
yellow dog contract?
A:
1. A representation by the Ee that he is
not a member of a labor union.
2. A promise by the Ee not to join a
labor union.
3. A promise by the Ee that upon joining
a labor union, he will quit his
employment.
l OB
Q: What is "contracting out" as aform of
ULP?
A: It is to contract out services or functions
being performed by union members when
such will interfere with, restrain or coerce Ees
in the exercise of their rights to self-
organization.
Q: Does it mean that an Er cannot contract
out work?
A:
GR: Contracting out services is not ULP
per se.
XPN: It is ULP only when the ft. exists:
1. The services contracted out are being
performed by union members; and
2. Such contracting out interferes with,
restrains, or coerce Ees in the
exercise of their right to self-
organization.
Note: When the contracting out is being done for
business reasons such as decline in business
inadequacy of equipment or to reduce cost, the~
it is a valid exercise of management prerogative.
Q: Company "A" contracts out its clerical
and janitorial services. In the negotiations
of its CBA, the union insisted that the
company may no longer engage in
contracting out these types of services,
which services the union claims to be
necessary in the company's business,
without prior consultation. Is the union's
stand valid or not? For what reason(s)?
A: The union's stand is not valid. It is part of
management prerogative to contract out any
work, task, job or project except that it is an
ULP to contract out services or
functions performed by union members
when such will interfere with, restrain or
coerce Ees in the exercise of their rights to
self-organization. (Art. 248[c] of the l.C).
(2001 Bar Question)
Q: What is a run-away shop?
A: It is an industrial plant moved by its owners
from one location to another to escape labor
regulations or State laws or to discriminate
against Ees at the old plant because of their
union activities.
Q: Is resorting to run-away shop ULP?
A: Yes. Where a plant removal is for business
reasons but the relocation is hastened by anti-
union motivation, the early removal is ULP. It
Q: A profit sharing scheme was introduced
by the company for its managers and
supervisors who are not members of the
union, hence do not enjoy the benefits of
the CSA. The respondent union wanted to
UNiVERSITY OF SANTO TOMAS ~. 109
IF'acuCtaa ae (])erecfio CiviC .
is immaterial that the relocation is
accompanied by a transfer of title to a new
employer (Er) who is an alter ego of the
original Er.
Q: What is a company union?
A: Any labor organization whose formation,
function or administration has been assisted
by any act defined as ULP. (Arl. 212[i])
Q: What are the forms o~) company
unionism?
A:
1. Initiation of the company union idea
by:
a. Outright formation by Er or his
representatives
b. Ee formation on outright demand
or influence by Er and
c. Managerially motivated formation
by Ees
2. Financial supporl to the union by:
a. Er defrays union expenses
b. Pays atty's fees to the attorney
who drafted the Constitution or
by-laws of the union.
3. Er encouragement assistance -
Immediately granting of exclusive
recognition as bargaining agent
without determining whether the
union represents the majority of the
employees
4. Supervisory assistance- Soliciting
membership, permitting union
activities during work time or coercing
Ees to join the union by threats of
dismissal or demotion
Q: What is meant by the act of company-
domination of union?
A: This is to initiate, dominate, assist or
otherwise interfere with the formation or
administration of any labor organization
including giving of financial or other support to
it or its organizers or supporters.
Q: Why is company unionism/captive
unionism a form of ULP?
A: It is considered ULP because the officers
will be beholden to the Ers and they will not
look after the interest of whom they represent.
Q: What is meant by discrimination as a
form of ULP?
A: It is to discriminate in regard to wages,
hours of work and other terms and conditions
of employment in order to encourage or
discourage membership in any labor
organization.
Q: When is a discharge of an Ee
discriminatory?
A: For the test of determining whether or not a
discharge is discriminatory, it is necessary that
the underlying reason for the discharge be
established.
The fact that a lawful cause for discharge is
available is not a defense where the Ee is
actually discharged because of his union
activities. If the discharge is actually motivated
by lawful reason, the fact that the Ee is
engaged in union activities at the time will lie
against the Er and prevent him from the
exercise of business judgment to discharge an
Ee for cause. (Phil. Metal Foundries Inc. v.
GIR, G.R. Nos. L-34948-49, May 15, 1979)
Q: J obo has 3 hotels, the Taal Vista Lodge,
Manila Hotel and the Pines Hotel. Among
the 3, Pines Hotel had more Ees and the
only one with a labor organization (LO).
When the bonus was distributed among the
3 hotels, Pines Hotel Ees received the least
amount compared to the Ees of Manila
Hotel and Taal Vista Lodge. Did the
company commit ULP?
A: Yes. The sharing of the bonuses is
discriminatory and such constitute ULP. The
Pines Hotel Ees would be receiving fewer
bonuses compared to the Ees of Taal Vista
Lodge and Manila Hotel where neither has a
LO nor does the complainant union has a
member. Taking into account that Pines Hotel
is realizing profit compared to that of Taal
Vista. Same analogy applies in the salary
increase. (Manila Hotel Co. v. Pines Hotel Ees'
Ass'n, G.R. No.L-30139, Sep. 28, 1972)
Q: When can there be a valid
discrimination?
A: The employer is not guilty of ULP if it
merely complies in good faith with the request
of the certified union for the dismissal of
employees expelled from the union pursuant to
the union security clause in the CSA. (Soriano
v. Atienza, G.R. No. L-68619, Mar. 16, 1989)
participate with the scheme but was denied
by the company due to the CSA.
Subsequently the company distributed the
profit sharing to the manager, supervisors
and other non-union member Ees. As a
result the union filed a notice of strike
alleging ULP. Is the non-extension of the
profit sharing scheme to union members
discriminatory and an ULP?
A: No. There can be no discrimination when
the Ees are not similarly situated. The situation
of union members is different and distinct from
non-union members because only union
members enjoy the benefit under the CSA.
The profit sharing scheme was extended to
those who do not enjoy the benefits of the
CSA. Hence, there is no discrimination and
ULP is not committed. (Wise and Co., Inc. v.
NLRC, GR No. L-87672, Oct. 13, 1989)
Q: Is dismissal of an Ee pursuant to a
union security clause a form of ULP?
A: No. Union security clauses in the CSA, if
freely and voluntarily entered into, are valid
and binding. Thus, the dismissal of an Ee by
the company pursuant to a labor union's
demand in accordance with a union security
agreement does not constitute ULP.
(Ma/ayang Samahan ng mga Manggagawa sa
M. Greenfield v. Ramos, G.R. No. 113907,
Feb. 28, 2000)
A union member who is employed under an
agreement between the union and his Er is
bound by the provisions thereof since it is a
joint and several contract of the members of
the union entered into by the union as their
agent. (Mana/ang v. Artex Dev't, GR No. L-
20432, Oct. 30, 1967)
Q: Is notice and hearing required in case an
Ee is dismissed pursuant to a union
security clause?
A: Yes. Although a union security clause in a
CSA may be validly enforced and dismissal
pursuant to thereto may likewise be valid, this
does not erode the fundamental requirement
of due process. The reason behind the
enforcement of union security clauses which is
the sanctity and inviolability of contracts
cannot erode one's right to due process.
Notwithstanding the fact that the dismissal was
at the instance of the federation and that it
undertook to hold the company free from any
liability resulting from such dismissal, the
company may still be held liable if it was
remiss in its duty to accord the would-be
110
dismissed Ees their right to be heard on the
matter.
Q: Mabeza and her co-Ees were asked by
the company to sign an affidavit attesting
to the latter's compliance with pertinent
labor laws. Mabeza signed the affidavit but
refused to swear to its veracity before the
City prosecutor. Mabeza then filed a LOA
which was denied by management. After
sometime, she attempted to return to work
but the company informed her not to report
for work and continue with her unofficial
leave. Did the company commit ULP?
A: Yes. The act of compelling an Ee to sign an
instrument indicating the Er's compliance with
Labor laws which the company might have
viotated together with the act of terminating or
coercing those Ees to cooperate is an act of
ULP. This is analogous with Art. 248 (f) of the
LC which provides: " to dismiss, discharge or
otherwise prejudice or discriminate against an
Ee for having given or being about to give
testimony under this Code" . For in not giving a
positive testimony in favor of the Er, Mabeza
reserved not only her right to dispute the claim
but also to work for better terms and condition.
(Mabeza v. NLRC, G.R No. 118506, April 18,
1997)
Q: What is vlolation of the duty to bargain
as a kind of ULP?
A: This is the act of violating the duty to
bargain collectively as prescribed in the LC.
Q: What are the forms of ULP in
bargaining?
A:
1. Failure or refusal to meet and
convene
2. Evading the mandatory subject of
bargaining
3. Sad faith (SF) bargaining, including
failure to execute the CSA if
requested
4. Gross violation of the CSA
Note: A company's refusal to make counter-
proposal, if considered in relation to the entire
bargaining process, may indicate BF and this is
especially true where the union's request for a
counter proposal is left unanswered. (Kiok Loy v.
NLRC, G.R. No. L-54334, Jan. 22, 1986)
Q: What are the examples of ULP in
bargaining?
A:
1.. Delaying negotiations by discussing
unrelated matters
2. Refusal to accept request to bargain
3. Rejecting a union's offer to prove its
majority claim
4. Shutdown to avoid bargaining and
5. Engaging in surface bargaining
H "
Q: Balmar Farms Ees Association (BFEA)
is affiliated with Associated Labor Union
(ALU). ALU won in the certification election
held in the company. Thus, ALU sent its
proposal for a CBA, but the company
refused to act on it alleging that BEA is the
sole and exclusive bargaining
representative and that BFEA through its
president had sent a letter informing the
company of its disaffiliation with ALU. Is
the company guilty of ULP for refusing to
bargain collectively?
A: Yes. ALU is the certified exclusive
bargaining representative after winning the
certification election. The company merely
relied on the letter of disaffiliation by BFEA's
president without proof and consequently
refusing to bargain collectively constitutes
ULP. Such refusal by the company to bargain
collectively with the certified exclusive
bargaining representative is a violation of its
duty to collectively bargain which constitutes
ULP. (Balmar Farms v. NLRC, G.R. No. 73504,
Oct, 15, 1991)
Q: The Kilusang Kabisig, a newly-formed
labor union claiming to represent a
majority of the workers in the Microchip
Corp., proceeded to present a list of
demands to the management for purposes
of collective bargaining (CB). The
Microchips Corp., a multinational
corp. engaged in the production of
computer chips for export, declined to
talk with the union leaders, alleging
that they had not as yet presented any
proof of majority status. The Kilusang
Kabisig then charged Microchip Corp. with
ULP, and declared a "wildcat" strike
wherein means of ingress and egress were
blocked and remote and isolated acts of
destruction and violence were committed.
Was the company guilty of an ULP when it
refused to negotiate with the Kilusang
Kabisig?
the duty to bargain collectively only with a
legitimate labor organization designated or
selected by the majority of the Ees in an
appropriate CB unit. It is not a ULP for an Er to
ask a union requesting to bargain collectively
that such union first show proof of its being a
majority union. (1997 Bar Question)
Q: What is surface bargaining?
A: It is the act of going through the motions of
negotiating without any legal intent to reach an
agreement. It involves the question of whether
or not the Ers conduct demonstrates an
unwillingness to bargain in good faith or is
merely hard bargaining. (Standard Chartered
Bank v. Confessor, G.R. No, 114974, June 16,
2004)
Note: Occurs when the Er constantly changes its
position over the agreement.
Q: What is meant by paid negotiation as a
form of ULP?
A: It is the act of the employer to pay
negotiation or atty's fees to the union or its
officers or agents as part of the settlement of
any issue in collective bargaining or any other
dispute.
Q: When is the violation of CBA considered
as ULP?
A: Only when the violation is gross - There
must be a flagrant and/or malicious refusal to
comply with the economic provision of the
CBA.
Note: All the ULP acts must have a relation to the
Ees exercise of their right to self-organization.
Anti-union or anti-organization motive must be
proved because it is a definitional element of
ULP.
If violation is not gross, it is not ULP but a
grievance under CBA. The " grossly violate"
phrase is an amendment by RA 6715.
Q: A complaint for ULP was filed by a
prosecutor of the CIR against Alhambra
company, upon the charges of the union
that 15 of its members employed as drivers
and helpers are discriminated for being
deprived of the benefits under the CBA
with no justifiable reason other than union
membership. Is the company guilty of
ULP?
A: Yes. The refusal to extend the benefits and
A: No. It is not an ULP not to bargain with a privileges under the CBA to Ees constitutes
union which has not presented any proof of its ULP. Failure on the part of the 'Company to live
majority status. The LC imposes on an Er up in goo faith to the terms of- the CBA is a
UNIVERSITY OF SANTO TOMAS f'.<..C.>~ 111
Pacu{ taa ae (} )er echO Civif '9'
serious violation of the duty to collectively
bargain which again amounts to ULP. The 15
drivers and helpers are found to be Ees of the
company, hence, the benefit and privileges
under the CBA should be extended to them.
(Alhambra Industries v, CIR, G.R. No. L-
25984, Oct. 30, 1970)
Q: What are the reliefs available in ULP
cases?
A: The following reliefs may be availed of:
1. Cease and desist order
2. Affirmative order
3. Court may order the employer to
bargain. CBA may be imposed.
4. Strike by union members
Note: ULP cases are not subject to compromise
in view of the public interest involve. The relation
between capital and labor is not merely
contractual. They are impressed with public
interest that labor contracts must yield to
common good.
Q: Is the commission of an ULP by an
employer subject to criminal prosecution?
A: Yes, because ULPs are not only violations
of the civil rights of both labor and
management but are also criminal offenses
against the State which shall be subject to
prosecution and punishment. (Arl. 247 LC;
See also B.P. Big. 386 as amended by R.A.
6715). However, the criminal aspect can
only be filed when the decision of the labor
tribunals, finding the existence of ULP, shall
have become final and executory. (2005 Bar
Question)
. ART. 249. ULP OF LABOR
i ORGANIZATIONS
Q: What are the ULP of LOs?
A: It shall be ULP for a La, its officers, agents
or representatives:
1. To restrain or coerce Ees in the
exercise of their rights to self-
organization. However, a LO shall
have the right to prescribe its own
rules with respect to the acquisition or
retention of membership
2. To cause or attempt to cause an Er to
discriminate against an Ee, including
discrimination against an Ee with
respect to whom membership in such
organization has been denied or to
terminate an Ee on any ground other
than the usual terms and conditions
112
under which membership or
continuation of membership is made
available to other members
3. To violate the duty, or refuse to
bargain collectively with the Er,
provided it is the representative of the
Ees
4. To cause or attempt to cause an Er to
payor deliver or agree to payor
deliver any money or other things of
value, in the nature of an exaction, for
services which are not performed or
not to be performed, including the
demand for fee for union negotiations
5. To ask for or accept negotiations or
atty's fees from Ers as part of the
settlement of any issue in collective
bargaining (CB) or any other dispute
or
6. To violate a CBA.
Q: Is interference by a LO an ULP?
A: No, because interference by a LO in the
exercise of the right to organize is itself a
function of self-organizing.
Q: What are examples of interference which
does not amount to ULP?
A:
1. Union campaigns for membership
even among members of another
union
2. Filing by a union of a petition to
dislodge an incumbent bargaining
union
3. A bargaining union, through a union
security clause, requires an incoming
employee to join the union.
Q: Maya union coerce Ees to join a strike?
A: No. A union violates the law when, to
restrain or coerce non-strikers from working
during the strike, it:
1. Assaults or threatens to assault them
2. Threatens them with the loss of their
jobs
3. Blocks their ingress to or egress from
the plant
4. Damages non-strikers' automobiles
or forces them off the highway
5. Physically preventing them from
working
6. Sabotages the Er's property in their
presence, thereby creating an
atmosphere of fear or violence
7. Demonstrates loudly in front of a non-
strikers' residence with signs and
shouts accusing the non-striker of
"scabbing"
8. Holding the non striker up to ridicule
9. Seeking public condemnation of the
non-striker
Q: What is a case of union induced
discrimination by labor organization (LO)?
A: This pertains to the arbitrary w;e of ~union
security clause. "
A union member may not be expelled from the
union, and consequently from his job, for
personal and impetuous reasons or for causes
foreign to the closed shop agreement. (Manila
Mandarin Ees Union v. NLRG, G. R. No.
76989, Sep. 29, 1987)
Labor unions are not entitled to arbitrarily
exclude qualified applicants for membership
and a closed-shop applicants provision will not
justify the employer in discharging, or a union
in insisting upon the discharge of an employee
whom the union thus refuses 10 admit to
membership without any reasonable ground
thereof. (Salunga v. GIR, G.R. No. L-22456,
Sep. 27, 1967)
Q: When is there refusal to bargain?
A: A union violates its duty to bargain
collectively by entering negotiations with a
fixed purpose of not reaching an agreement or
signing a contract.
Q: What is featherbeddingl make work
activities?
A: It refers to the practice of the union or its
agents in causing or attempting to cause an
employer (Er) to payor deliver or agree to pay
or deliver money or other things of value, in
the nature of an exaction, for services which
are not performed or not to be performed, as
when a union demands that the Er maintain
personnel in excess of the latter's
requirements.
Note: It is not featherbedding if the work is
performed no matter how unnecessary or useless
it may be.
Q: What is the sweetheart doctrine?
A: It is when a LO asks for or accepts
negotiations or atty's fees from employers as
part of the settlement of any issue in GB or any
other dispute.
Note: The resulting CBA is considered as a
" sweetheart contract" - a CSA that does not
substantially improve the employees wages and
benefits and whose benefits are far below than
those provided by law.
Q: What is blue-sky bargaining?
A: It is defined as making exaggerated or
unreasonable proposals.
Note: Whether or not the union is engaged in
blue-sky bargaining is determined by the
evidence presented by the union as to its
economic demands. Thus, if the union requires
exaggerated or unreasonable economic
demands, then it is guilty of ULP. (Standard
Chartered Bank v. Confessor, G.R. No. 114974,
June 16, 2004)
Q: When does boulwarism occur?
A: It occurs when employer (Er) directly
bargains with the employee (Ee) disregarding
the union; the aim was to deal with the labor
union through Ees rather than with the Ees
thru the union. Er submits its proposals and
adopts a take-it-or-Ieave-it stand.
Academics Committee
Vi a-Cbai r for Academi cs: J eannie /\, Laurentino
' Vi se-Chai r j or Admi n &F i nance: Aissa CelineH.Luna
Vi ce-Chai r j or L ayout ~." Desi gn: LoiseRae G, Naval
Labor Law Committee
S ub;ect H ead: Lester J ay AlanE.FloresII
Members:
ChristianNino,-\.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelleC.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
-e:~,.~,~.
Pacu(taa ae < Der ecl i o Ci ' Vi C
LABOR RELATIONS: COLLECTIVE BARGAINING
, COLLECTIVE BARGAINING AND
~ ADMINISTRATION OF AGREEMENTS
Q: What is collective bargaining (CB)?
A:
1. It is the process of negotiation by an
organization or group of workmen, in
behalf of its members, with the
employer (Er), concerning wages,
hours of work, and other terms and
conditions of employment and
2. The settlement of disputes by
negotiation between an Er and the
representative of his employees (Ee)
3. It is the obligation to meet and
convene promptly and expeditiously
in good faith for the purpose of
negotiating an agreement with
respect to wages, hours of work and
all other terms and conditions of
employment including proposals for
adjusting any grievances or questions
arising under such agreement and
executing a contract incorporating
such agreements if requested by
either party but such does not compel
any party to agree to a proposal or to
make any concession. (Art. 252, LC)
Note:
GR: No court or administrative agency or
official shall have the power to set or fix
wages, rates of pay, hours of work, or other
XPN: As otherwise provided under the LC:
1. National Wages and Productivity
Commission and R1WPB as to wage
fixing. (Art. 99 and 122, LC)
2. NCMS and NLRC as to wage
distortion. (Art. 124, LC)
3. SLE and President of the Philippines
as to certification and assumption of
powers over labor disputes. (Art.
236[gj, LC)
Q: What is the purpose behind this rule?
A: It is to encourage a truly democratic method
of regulating the relations between the
employers and employees by means of
agreements freely entered into through CB.
Q: Who are the parties to a CB?
A:
1. Employer
2. Employees, represented by the
exclusive bargaining agent
Q: What are the jurisdictional preconditions
in collective bargaining?
A:
1. Possession of the status of majority
representation of the employees
representative in accordance with any
of the means of selection or
designation provided for the Labor
Code
2. Proof of majority representation
3. A demand to bargain under Art. 250
(a) of the LC. (Kiok Loy v. NLRC,
G.R. No. L-54334, Jan.22, 1986)
Q: When does the duty of the employer (Er)
to bargain collectively arise?
A: Only after the union requests the Er to
bargain. If there is no demand, the Er cannot
be in default.
Note: Where a majority representative has been
designated, it is an ULP for the Er, as a refusal to
collectively bargain, to deal and negotiate with
the minority representative to the exclusion of the
majority representative.
Where there is a legitimate representation issue,
there is no duty to bargain collectively on the part
of the Er (Lakas ng mga Manggagawang
Makabayan v. Marcelo Enterprises, G.R. No. L-
38258. Nov. 19, 1982)
Q: What are the 4 forms of ULP in
bargaining?
A:
1. Failure to meet and convene
2. Evading the mandatory subjects of
bargaining.
3. Bad faith in bargaining (boulwarism)
4. Gross violation of the CBA
Note: Violations of CSA, except those which are
gross in character, shall no longer be treated as
ULP but a grievance under CSA. (Art. 261, LC,
Silva v. NLRC. GR. No. 110226, June 19 1997)
Q: What is a collective bargaining
agreement (CSA)?
A: It is a contract executed upon request of
either the Er or the exclusive bargaining
representative of the Ees incorporating the
agreement reached after negotiations with
respect to wages, hours of work, terms and
conditions of employment, including proposals
for adjusting any grievance or questions under
the agreement.
Note: The certification of the CBA by the BLR is
not required to make such contract valid. Once it
is duly entered into and signed by the parties, a
GSA becomes effective as between the parties
whether or not it has been certified by the SLR.
(Liberly Flour Mills Ee's Association v. Liberly
Flour Mil/s, G.R. Nos. 58768-70, Dec. 29, 1989)
Q: What is a zipper clause?
A: It is a stipulation in a CSA indicating that
issues that could have been negotiated upon
but not contained in the CSA cannot be raised
for negotiation when the CSA is already in
~) ..
effect.'
Note: Only provisions embodied in the GSA
should be liberally interpreted and complied with.
Where the proposal of one party does not find
print in the GSA, it is not part thereof and the
proponent has no claim whatsoever to its
implementation. (Samahang Manggagawa sa
Top Form v. NLRG, GR. No. 113856, Sep. 7,
1998)
Q: When shall bargaining commence?
A: It commences within 12 months after the
determination and certification. of the Ees
exclusive bargaining representative.
(certification year)
, ' ART. 250. PROCEDURE IN COLLECTIVE
, BARGAINING (CB)
Q: What is the procedure in CB?
A: When a party desires to negotiate an
agreement:
1. It shall serve a written notice upon the
other party with a statement of
proposals
2. Reply by the other party shall be
made within 10 days with counter
proposals
3. In case of differences, either party
may request for a conference which
must be held within 10 calendar days
from receipt of request
4. If not settled, NCMS may intervene
and encourage the parties to submit
the dispute to a voluntary arbitrator
5. If not resolved, the parties may resort
to any other lawful means (either to
settle the dispute or submit it to a
voluntary arbitrator).
Note: During the conciliation proceeding in the
NCMS, the parties are prohibited from doing any
act which may disrupt or impede the early
settlement of disputes. (Arl.250[dj, LC)
Q: What are the stages in CS?
A:
1. Preliminary process: Sending a
written notice for negotiation which
must be clear and unequivocal
2. Negotiation process.
3. Execution process: The signing of the
agreement
4. Publication for at least 5 days before
ratification
5. Ratification by the majority of all the
workers in the bargaining unit
represented in the negotiation (not
necessary in case of arbitral award)
6. Registration process.
7. Administration process: The CSA
shall be jointly administered by the
management and the bargaining
agent for a period of 5years.
8. Interpretation and Application
process.
Q: What are the mandatory provisions of
the CSA?
A:
1. Wages
2. Hours of work
3. Grievance machinery
4. Voluntary arbitration
5. Family planning
6. Rates of pay
7. Mutual observance clause
Note: In addition, the SLR requires the CSA
should include a clear statement of the terms of
the GSA.
Er's duty to bargain is limited to mandatory
bargaining subjects; as to other matters, he IS
free to bargain or not.
Q: Does a petition for cancellation of a
union's certificate of registration involve a
prejudicial question that should first be
settled before parties could be required to
collectively bargain?
A: No. A pending cancellation proceeding is
not a bar to set mechanics for collective
bargaining (CB). If a certification election may
still be held even if a petition for cancellation of
a union's registration is pending, more so that
the CS process may proceed. The majority
status of the union is not affected by the
cancellation proceedings. (Capitol Medical
Center v. Trajano, G.R. No. 155690, June 30,
2005)
UNIVERS!TY OF SANTO TOMAS
Pacu{taa de (] )er echo Ci vi C
f-'-'-'~
.~. 115
ART. 251. DUTY TO BARGAIN
COLLECTIVELY IN THE ABSENCE OF CBA
ART.2S2. MEANING OF DUTY TO BARGAIN
; - COLLECTIVELY
Q: What is the duty to bargain collectively
when there is no CSA?
A: It is the performance of a mutual obligation:
1. To meet and convene promptly and
expeditiously in good faith (GF)
2. For the purpose of negotiating an
agreement with respect to wages,
hours of work and all other terms and
3. Including proposals for adjusting any
grievances or questions arising under
such agreement; and
4. To execute a contract incorporating
such agreements if requested by
either party. (Art. 252)
Q: What are the limitations to the duty to
bargain collectively?
A:
1. Such duty does not compel any party
to agree to a proposal or to make any
concession.
2. Parties cannot stipulate terms and
conditions of employment which are
below the minimum req'ts prescribed
by law.
Q: May either party bargain to an impasse?
A: It depends:
1. Where the subject of a dispute is a
mandatory bargaining subject, either
party may bargain to an impasse as
long as he bargains in GF.
2. Where the subject is non-mandatory,
a party may not insist in bargaining to
the point of impasse. His instance
may be construed as evasion of duty
to bargain.
Q: What is the test of bargaining in bad
faith?
A: There is no perfect test of good faith (GF) in
bargaining. The GF or BF is an inference to be
drawn from the facts and is largely a matter for
the NLRC's expertise. The charge of BF
should be raised while the bargaining is in
progress.
Note: With the execution of the CSA, SF can no
longer be imputed upon any of the parties
thereto. All provisions in the CSA are supposed
116
to have been jOintly and voluntarily incorporated
therein by the parties. This is not a case where
private respondent exhibited an indifferent
attitude towards CS because the negotiations
were not the unilateral activity of petitioner union.
The CSA is good enough that private respondent
exerted "reasonable effort of GF bargaining."
(Samahang Manggagawa sa Top Form
Manufacturing-United Workers of the Pnits v.
NLRC, G.R. No. 113856, Sept. 7, 1998)
Q: Does an Er's steadfast insistence to
exclude a particular substantive provision
in the negotiatiol1s for a CSA constitute
refusal to bargain or bargaining in SF?
A: No. This is no different from a
bargaining representative's perseverance to
include one that they. deem of absolute
necessity. Indeed, an adamant insistence on a
bargaining position to the point where the
negotiations reach an impasse does not
establish bad faith. Obviously, the purpose of
CB is the reaching of an agreement resulting
in a contract binding on the parties; but the
failure to reach an agreement after
negotiations have continued for a reasonable
period does not establish a lack of good faith.
The statutes invite and contemplate a
collective bargaining contract, but they do not
compel one. The duty to bargain does not
include the obligation to reach an agreement.
While the law makes it an obligation for the Er
and the Ees to bargain collectively with each
other, such compulsion does not include the
commitment to precipitately accept or agree to
the proposals of the other. All it contemplates
is that both parties should approach the
negotiation with an open mind and make
reasonable effort to reach a common ground
of agreement. (Union of Fi/ipro Ees v. Nestle
Phils., G.R. Nos. 158930-31, Mar. 3, 2008)
Q: What is a deadlock?
A: It is synonymous with impasse or a
standstill which presupposes reasonable effort
at GF bargaining but despite noble intentions
does not conclude an agreement between the
parties.
Q: In case of deadlock in the renegotiation
of the CSA, what are the actions that may
be taken by the parties?
A: The parties may:
1. Call upon the NCMB to intervene for
the purpose of conducting conciliation
or preventive mediation;
2. Refer the matter for voluntary
arbitration or compulsory arbitration;
1. A labor union may disaffiliate from the
mother union to form a local or
UNIVERSITY OF SANTO TOMAS ("-'-'. 117
Pacu(taa de ([ )er ecl i o Citli{ '9'
3. Declare a strike or lockout upon
compliance with the legal req'ts (This
remedy is a remedy of last resort).
Q: May economic exigencies justify refusal
to bargain?
A: No. An employer is not guilty of refusal to
bargain by adamantly rejecting the union's
economic demands where he is operating at a
loss, on a low profit margin, or in a depressed
industry, as long as he continues to negotiate.
But financial hardship constitutes no excuse
for refusing to bargain collectively.
: ART.253. DUTY TO BARGAIN
: COLLECTIVELY WHEN THERE EXISTS A
, COLLECTIVE BARGAINING AGREEMENT
Q: What is the duty to bargain collectively
when there is a CBA?
A:
1. When there is a CSA the duty to
bargain collectively shall also mean
that neither party shall terminate nor
modify such agreement during its
lifetime.
2. Either party can serve a written notice
to terminate or modify the agreement
at least 60 days prior to its expiration
date.
3. It shall be the duty of both parties to
keep the status quo and to 'continue
in full force and effect the terms and
conditions of the existing agreement
during the 60-day period and/or until
a new agreement is reached by the
parties. (Art. 253, LC)
Q: What is the automatic renewal clause of
CBAs?
A: Although a CBA has expired, it continues to
have legal effects as between the parties until
a new CBA has been entered into (Pier &
Arrastre Stevedoring Services, Inc. v.
Confessor, G.R. No. 110854, February 13,
1995). This is so because the law makes it a
duty of the parties to keep the status quo and
to continue in full effect the terms and
conditions of the existing agreement until a
new agreement is reached by the parties. (Art.
253, LC). (2008 Bar Question)
Q: What may be done during the 50-day
freedom period?
A:
independent union only during the 60-
day freedom period immediately
preceding the expiration of the CBA.
2. Either party can serve a written notice
to terminate or modify agreement at
least 50-days prior to its expiration
period.
3. A petition for certification election
may be filed.
Q: When to file CBA?
A: Within 30 days from execution of CSA.
Q: What are the req'ts for registration?
A: The application for CBA registration shall
be accompanied by the original and 2
duplicate copies of the following req'ts:
1. CSA
2. A statement that the CSA was posted
in at least 2 conspicuous places in
the establishment concerned for at
least 5 days before its ratification
3. Statement that the CBA was ratified
by the majority of the Ees in the
bargaining unit.
Note: The following documents must be certified
under oath by the representative of the Er and
the labor union. No other document shall be
required in the registration of the CSA
Q: What is a single enterprise bargaining?
A: It involves negotiation between one certified
labor union and one Er. Any voluntarily
recognized or certified labor union may
demand negotiations with its Er for terms and
conditions of work covering Ee's in the
bargaining unit concerned.
Q: What is a multi-Er bargaining scheme?
A: It involves negotiation between and among
several certified labor unions and Ers.
ART. 253-A. TERMS OF A CBA s:
Q: What is the duration of a CBA?
A:
1. With respect to the representation
aspect (refers to the identity and
majority status of the union that
negotiated the CSA as the exclusive
bargaining representative): 5 years
2. With respect to all other provisions
(refers to the rest of the CSA,
economic as well as non-economic
provisions other than representational
provisions): 3 years after the
execution of the CSA
Q: What are the economic provisions of a
CBA?
A:
1. Wages
2. Family planning
3. Effectivity of the agreement
4. Other terms and conditions of
employment
Q: What are the non-economic provisions
of a CBA?
A:
1. Coverage of the bargaining unit
2. Union security clauses
3. Management prerogatives and/or
rights/responsibilities of employees
4. Grievance machinery and voluntary
arbitration
5. No strike - no lock out provision
Q: What is the effectivity and retroactivity
date of other economic provisions of the
CBA?
A:
1. If the CSA is the very first for the
bargaining unit, the parties have to
decide the CSA effectivity date.
2. Those made within 6 months after
date of expiry of the CSA are subject
to automatic retroaction to the day
immediately following the date of
expiry.
3. Those not made within 6 months, the
parties may agree to the date of
retroaction.
Note: This rule applies only if there is an existing
agreement. If there is no existing agreement,
there is no retroactive effect because the date
agreed upon shall be the start of the period of
agreement.
Art. 253-A on retroactivity does not apply if the
provisions were imposed by the SLE by virtue of
arbitration. It applies only if the agreement was
voluntarily made by the parties.
Q: May the economic provisions of an
existing CBA be extended beyond the 3
year period as prescribed by law in the
absence of a new agreement?
A: Yes. Under the principle of hold over, until a
new CSA has been executed by and between
the parties, they are duty bound to keep the
status quo and must continue in full force and
effect the terms and conditions of the existing
agreement. The law does not provide for any
exception or qualification as to which of the
economic provisions of the existinq agreement
are to retain force and effect. Therefore, it
must be encompassing all the terms and
condition in the said agreement. (New Pacific
Timber v. NLRC, G.R. No. 124224, Mar. 17,
2000)
Q: Mindanao Terminal Company and
respondent union has an existing CBA
which was about to expire. Thus,
negotiations were held regarding certain
provisions of the CBA which resulted in a
deadlock. Thus the union filed a notice of
strike. During the conference called by the
NCM13 the company and the union were
able to agree on all of the provisions of the
CBA except for one. However, the last
unresolved provision was subsequently
settled but no CBA was signed. Hence, in
the records of the Mediation Arbiter, all
issues were settled before the lapse of the
6 month period after the expiration of the
old CBA. Does the Signing of the CBA
determine the date it was entered into
within the 6 month period?
A: No. The signing of the CSA does not
determine whether the agreement was entered
into within the 6 month period from the date of
expiration of the old CSA. In the present case,
there was already a meeting of the minds
between the company and the union prior to
the end of the 6 month period after the
expiration of the old CSA. Hence, such
meeting of the mind is sufficient to conclude
that an agreement has been reached within
the 6 month period as provided under Art. 253-
A of the LC. (Mindanao Terminal and
Brokerage Services lnc., v. Confessor, GR.
No. 111809, May 5, 1997)
Q: When is the effectivity of a CBA arbitral
award concluded beyond 6 months from
the expiration of the old CBA?
A: The CSA arbitral awards granted 6 months
from the expiration of the last CSA shall
retroact to such time agreed upon by both the
Er and the union. Absent such agreement as
to retroactivity, the award shall retroact to the
1
51
day after the 6 month period following the
expiration of the last day of the CSA should
there be one. In the absence of a CSA, the
SLE's determination of the date of retroactivity
as part of his discretionary powers over arbitral
award shall control. (Manila Electric Company
v. Quisumbing, G.R. No. 127598, Feb. 22 and
Aug. 1, 2000)
Q: PAL was suffering from a worsened
financial condition resulting to a
retrenchment which downsized its labor
force by more than 1/3 thereby affecting
numerous union members. Hence, the
union went on strike. The PAL offered that
shares of stock be transferred to its Ees
but the union refused. Thus, PAL claimed it
has no alternative left but to close. Hence,
the union PALEA offered that the CBA be
suspended for 10 years and to waive some
of the economic benefits i~ the, CBA
provided they remain the certlfled
bargaining agent. PAL agreed and
resumed operations. Is the agreement to
suspend the CBA for 10 years abdicated
the worker's right to bargain?
A: No. The primary purpose of a CBA is to
stabilize labor-management relations in order
to create a climate of a sound and stable
industrial peace. The assailed agreement was
the result of the voluntary CB negotiations
undertaken in the light of severe financial
situationfaced by PAL.
Q: Is the agreement In conflict with Art.
253-A of the LC?
A: No. There is no conflict between the
agreement and Art. 253-A of the LC for the
latter has a 2-fold purpose namely: a) to
promote industrial stability and predictability
and b) to assign specific time tables wherein
negotiations become a matter of right and
requirement. In sofar as the first purpose, the
agreement satisfies the first purpose. As
regard the second purpose, nothing in Art.
253-A prohibits the parties from waiving or
suspending the mandatory timetables and
agreeingonthe remedies toenforcethe same.
Q: Does the agreement violate the 5 year
representation limit as provided under Art.
253-A of the LC?
A: No. For under the said article, the
representation limit of the exclusive bargaining
agent applies only when there is an existing
CBA in full force and effect. In this case, the
parties agreed to suspend the CBA and put in
abeyance the limit on representation. (Rivera
v. Espiritu, G.R. No. 135547, Jan, 23, 2002)
BARGAINING AGENT and
CERTIFICATION PROCEEDINGS
ART. 255. EXCLUSIVE BARGAINING
REPRESENTATION (EBR) AND WORKER'S
. PARTICIPATION IN POLICY AND DECISION
, . '. MAKING . C
Q: What is the extent of the worker's right
to participate in policy and decision-
making processes in a company?
A: Such right refers not only to formulation of
corporate programs and policies but also to
participation in grievance procedures and
voluntary modes of settling disputes.
Q: Explain the extent of the workers' right
to participate in policy and decision-
making process as provided under Art. XIII,
Sec. 13 of the 1987 Constitution. Does it
include membership in the Board of
Directors of a corporation?
A: No. In Manila Electric Company v,
Quisumbing, G.R. No. 127598, January 27,
1999, the SC recognized the right of the union
to participatein policyformulation anddecision
making process on matters affectingthe Union
members' rights, duties andwelfare. However,
the SC heldthat such participationof the union
in committees of Er Meralco is not in the
nature of a co-management control of the
business of Meralco. Impliedly, therefore,
workers' participatory right in policy and
decision-making processes does not include
the right to put a union member in the
Corporation's Board of Directors. (2008 Bar
Question)
Q: Mayan Er solicit questions, suggestions
and complaints from Ees even though the
Ees are represented by a union?
A: Yes, provided:
1. The CB representative executes an
agreement waiving the right to be
present on any occasion when Ee
grievances are being adjusted by the
Er; and
2. Er acts strictly within the terms of his
waiver agreement.
PacuCtaa ae CDer ecno Ci vi C
Q: The hotel union filed a Notice of Strike
with the NCMB due to ULP against the
Diamond Hotel who refused to bargain with
it. The hotel advised the union that since it
was not certified by the DOLE as the
exclusive bargaining agent, it could not be
recognized as such. Whether the Union
may bargain collectively?
A: No. Art. 255 of the LC declares that only the
labor organization designated or selected by
the majority of the Ees in an appropriate
collective bargaining (CB) unit is the exclusive
representative of the employees (Ees) in such
unit for the purpose of CB. The union is
admittedly not the exclusive representative of
the majority of the Ees of the hotel, hence, it
could not demand from the hotel the right to
bargain collectively in their behalf. (Manila
Diamond Hotel v. Manila Diamond Hotel Ees
Union, G.R. No. 158075, June 30, 2006, J .
Carpio-Morales)
Q: Are probationary Ees allowed to vote at
the time of the certification elections?
A: Yes. Under Art. 255 of the LC the " labor
organization designated or selected by the
majority of the Ees in an appropriate
bargaining unit shall be the exclusive
representative of the Ees in such unit for
purposes of CB. " CB covers all aspects of the
employment relation and the resultant CSA
negotiated by the certified union binds all Ees
in the bargaining unit. Hence, all rank and file
Ees, probationary or permanent, have a
substantial interest in the selection of the
bargaining representative. The LC makes no
distinction as to their employment status as
basis for eligibility in supporting the petition for
certification election. The law refers to "a\l" the
Ees in the bargaining unit. All they need to be
eligible to support the petition is to belong to
the "bargaining unit." The provision in the CSA
disqualifying probationary Ees from voting
cannot override the constitutionally-protected
right of workers to self-organization, as well as
the provisions of the LC and its implementing
rules on certification elections and
jurisprudence. A law is read into, and forms
part of, a contract. Provisions in a contract are
valid only if they are not contrary to law,
morals, good customs, public order or public
policy. (NUWHRAIN-MPHC v. SLE, G.R. No.
181531, July 31,2009, J . Carpio-Morales)
120
.' ART. 256-259. PETIT10N FOR ,
:-' __ CERTIFICATION ELECTION (PCE~ '" .
Q: What is a bargaining unit?
A:
1. A group of employees (Ees)
2. Of a given employer
3. Comprised of all or less than all of the
entire body of Ees
4. Which the collective interest of all the
Ees consistent with equity to the Er
5. Indicate to be best suited to serve the
reciprocal rights and duties of the
parties under the collective
bargaining provisions.
Q: What are the factors considered in
determining the appropriateness of a
bargaining unit?
A:
1. Will of the Ees. (globe doctrine)
2. Affinity and unity of the Ees' interest,
such as substantial similarity of work
and duties, or similarity of
compensation and working
conditions. (substantial mutual
interest rule)
3. Prior collective bargaining history
4. Similarity of employment status.
(SMC v. Laguesma, G.R. No. 100485,
September 21, 1994)
Q: What. are the factors considered in
determining the substantial mutual interest
doctrine?
A:
1. Similarity in the scale and manner of
determining earnings
2. Similarity in employment benefits,
hours of work, and other terms and
3. Similarity in the kinds of work
performed
4. Similarity in the qualifications, skills
and training of Ees
5. Frequency of contract or interchange
among the Ees .
6. Geographical proximity
7. Continuity and integration of
production processes
8. Common supervision and
determination of labor-relations policy
9. History of CS
10. Desires of the affected Ees or
11. Extent of union organization
Q: A registered labor union in UP,
ONAPUP, filed a petition for certification
election (PCE) among the non-academic
Ees. The university did not oppose,
however, another labor union, the All UP
Workers Union assents that it represents
both academic and non-academic
personnel and seeks to unite all workers in
1 union. Do Ees performing academic
functions need to comprise a bargaining
unit distinct from that of the non-academic
E~? 0
A: Yes. The mutuality of interest test should
be taken into consideration. There are two
classes of rank and file Ees in the university
that is, those who perform academic functions
such as the professors and instructors and
those whose function are non-academic who
are the janitors, messengers, clerks etc. Thus,
not much reflection is needed to perceive that
the mutuality of interest which justifies the
formation of a single bargaining unit is lacking
between the two classes of Ees. (u.P. v.
Ferrer-Calleja, GR. No.96189, July 14, 1992)
Q: Is the bargaining history a decisive
factor in the determination of
appropriateness of bargaining unit?
A: No. While the existence of a bargaining
history is a factor that may be reckoned with in
determining the appropriate bargaining unit,
the same is not decisive or conclusive. Other
factors must be considered. The' test of
grouping is community or mutuality of
interests. This is so because the basic test of
an asserted bargaining unit's acceptability is
whether or not it is fundamentally the
combination which will best assure to a" Ees
the exercise of their CB rights. (Democratic
Labor Ass'n v. Cebu Stevedoring Company,
lnc., GR.. No. L-10321, Feb. 28, 1958)
Q: What is "one-union, one-company"
policy?
A:
GR: It is the proliferation of unions in an Er
unit. Such is discouraged as a matter of
policy unless there are compelling reasons
which would deny a certain class of Ees to
the right to self-organization for purposes of
collective bargaining (CB).
XPN:
1. Supervisory Ees who are allowed to
form their own unions apart from the
rank-and-file Ees and
The policy should yield to the right of
Ees to form union for purposes not
2.
contrary to law, self-organization and
to enter into CB negotiations.
Note: Two companies cannot be treated into a
single bargaining unit even if their businesses are
related.
Subsidiaries or corporations formed out of former
divisions of a mother company following a re-
organization may constitute a separate
bargaining unit.
Q: Union filed a peE among the rank and
file Ees of three security agencies
including the Veterans Security. The latter
opposed alleging that the three security
agencies have separate and distinct
corporate personalities. Maya single PCE
filed by a labor union in the three
corporations instead of filing 3 separate
petitions?
A: Yes. The following are indications that the 3
agencies do not exist and operate separately
and distinctly from each other with different
corporate direction and goals: 1) Veterans
Security failed to rebut the fact that they are
managed through the Utilities Management
Corp with a" their Ees drawing their salaries
and wages from the said entity; 2) that the
agencies have common and interlocking
incorporators and officers; 3) that they have a
single mutual benefit system and followed a
single system of compulsory retirement. 4)
they could easily transfer security guards of
one agency to another and back again by
simply filling-up a common pro-forma slip; 5)
they always hold joint yearly ceremonies such
as the PGA Annual Awards Ceremony; and 6)
they continue to be represented by one
counsel.
Hence, the veil of corporate fiction of the 3
agencies should be lifted for the purpose of
allowing the Ees of the 3 agencies to form
single union. As a single bargaining unit, the
Ees need not file 3 separate PCE. (Philippine
Scout Veterans Security and Investigation
Agency v. SLE, G.R. No. 92357, July 21,
1993)
ART. 256. REPRESENTATION; ISSUE IN
ORGANIZED ESTABLISHMENT .
Q: Who is a bargaining representative?
A: It is a LLO or an officer or agent of such
organization whether or not employed by the
Er. (Art. 2120])
UNIVERSITY OF SANTO TOMAS ("""'. 121
Pacu[ taa de ([ )er ecno Ci vi C '9'
Q: Who is an exclusive bargaining
representative?
A: Any LLO duly recognized or certified as the
sole and exclusive bargaining agent of all the
Ees in a bargaining unit. (Sec. 1 [t), Rule I,
Book V, IRR)
Q: Can there be several unions in one
bargaining unit?
A: Yes, but only one will be chosen as the
bargaining agent thru certification election.
Q: Can there be several bargaining agents
in one unit?
A: No.
Q: Can there be several bargaining agents
in one company?
A: Yes.
Q: Can there be several CBA in one
company?
A: Yes, provided there is only one CSA per
bargaining unit.
Q: Are all legitimate unions a bargaining
agent?
A: No.
Q: What is an organized establishment?
A: It refers to an enterprise where there exists
a recognized or certified sole and exclusive
bargaining unit. (Sec. 1 [II], Rule I, Book V,
IRR)
Q: What is an unorganized establishment?
A: It is one where no union has yet been duly
recognized or certified as bargaining
representative.
Q: PT&T Supervisory employees (Ees)
Union-APSOTEU filed a petition for
certification election (PCE) among the
supervisory Ees of PT&T. The UNION later
on amended its petition to include the
allegation that PT&T was an unorganized
establishment employing roughly 100
supervisory Ees from whose ranks will
constitute the bargaining unit sought to be
established. PT&T opposed the petition,
alleging that a certified bargaining unit
already existed among its rank-and-file Ees
which makes it an organized
establishment. Is PT&T an organized or
unorganized establishment?
:i22
A: The supervisory Ees of PT&T did not yet
have a certified bargaining agent to represent
them at the time the union, which is a LLO duly
registered with the DOLE, filed the PCE. Since
no certified bargaining agent represented the
supervisory Ees, PT&T may be deemed an
unorganized establishment.
The fact that petitioner's rank-and-file Ees
were already represented by a certified
bargaining agent does not make PT&T an
organized establishment vts-e-vis the
supervisory Ees. After all, supervisory Ees are
"not eligible for, membership in a labor
organization of the rank-and-file Ees. (PT& T
Corp. v. Laguesma, G.R. No. 101730, June
17, 1993)
Q: IJ Yhat are the 3 methods of determining
the bargaining representative?
A:
1. Voluntary recognition
2. Certification election with or without
run-off
3. Consent election
Q: What is voluntary recognition?
A: The process by which a legitimate labor
union is recognized by the employer (Er) as
the exclusive bargaining representative or
agent in a bargaining unit, reported with the
Regional Office. (Sec. 1[bbb), Rule I, Book V,
IRR)
Q: What are the three (3) conditions to
voluntary recognition (VR)?
A: VR requires 3 concurrent conditions:
1. VR is possible only in an unorganized
establishment.
2. Only one union must ask for
recognition. If there 2 or more unions
asking to be recognized, the Er
cannot recognize any of them; the
rivalry must be resolved through an
election.
3. The union voluntarily recognized
should be the majority union as
indicated by the fact that members of
the bargaining unit did not object to
the projected recognition. If no
objection is raised, the recognition will
proceed, the DOLE will be informed
and CSA recognition will commence.
If objection is raised, the recognition
is barred and a certification election
or consent election will have to take
place.
A: It is the process of determining through
secret ballot the sale and exclusive
representative of the Ees in an appropriate
UN!VERSITY OF SANTO TOMAS
Note: in an organized establishment, voluntary
recognition is not possible. A petition to hold a CE
has to be filed within the freedom period which
means the last 60 days of the s" year of the
expiring CSA. The petition may be filed by any
LLO, but the petition must have written support of
at least 25% of the Ees in the bargaining unit.
Q: Where and when to file the petition for
VR?
A: Within 30 days from such rec,ognition, Er
shall submit a notice of VR with the Regional
Office which issued the recognized labor
union's certificate of registration or certificate
of creation of a chartered local.
Q: What are the requirements for VR?
A: The notice of VR shall be accompanied by
the original copy and 2 duplicate copies of the
following req'ts:
1. J oint statement under oath of VR
2. Certificate of posting of joint
statement for 15 consecutive days in
at least 2 conspicuous places in the
establishment of the bargaining unit
3. Certificate of posting
4. Approximate number of Ees in the
bargaining unit and the names of
those who supported the recognition
5. Statement that the labor union is the
only LLO operating within the
bargaining unit.
Note: Where the notice of voluntary recognition is
sufficient in form, number and substance and
where there is no registered labor union
operating within the bargaining unit concerned,
the Regional Office, through the Labor Relations
Division shall, within 10 days from receipt of the
notice, record the fact of VR in its roster of
legitimate labor unions and notify the labor union
concerned.
Q: What are the effects of recording of fact
of voluntary recognition (VR)?
A:
1. The recognized labor union shall
enjoy the rights, privileges and
obligations of an existing bargaining
agent of all the employees (Ees) in
the bargaining unit.
2. It shall also bar the filing of a petition
for certification election by any labor
organization for a period of 1 year
from the date of entry of VR.
Q: What is certification election (CE)?
bargaining unit, for purposes of CB or
negotiation. (Sec. 1[hi, Rule I, Book V, IRR)
Note: The process is called CE because it serves
as the official, reliabie and democratic basis for
the BLR to determine and certify the union that
shall be the exclusive bargaining representative
of the Ees for the purpose of bargaining with the
Er.
Q: What is the nature of certification
election?
A: A certification election is not a litigation but
merely an investigation of a non-adversarial
fact-finding character in which BLR plays a
part of a disinterested investigator seeking
merely to ascertain the desire of the
employees as to the matter of their
representation. (Airline Pilots Ass'n of the
Philippines v. CIR, 76 SCRA 274)
Q: What is the purpose of a certification
election?
A: It is a means of determining the worker's
choice of:
1. Whether they want a union to
represent them for collective
bargaining or if they want no union to
represent them at all.
2. And if they choose to have a union to
represent them, they will choose
which among the contending unions
will be the sale and exclusive
bargaining representative of the
employees in the appropriate
bargaining unit.
Q: What are the issues involved in a
certification proceeding?
A: Certification proceedings directly involve
two issues:
1. Proper composition and constituency
of the bargaining unit; and
2. The veracity of majority membership
claims of the competing unions so as
to identity the one union that will
serve as the bargaining
representative of the entire
bargaining unit.
Note: Some of the Ees may not want to have a
union; hence, "no union" is one of the choices
named in the ballot. If "no union" wins. the
company or the bargaining unit remains un-
unionized for at least 12 months, the period is
known as 12-month bar. After that period, a
petition for a CE may be filed again.
PacuCtaa ae (] )er ecl i o CiviC
Q: Distinguish the requisites for a petition
for certification election between an
organized and an unorganized
establishment.
A:
CE
except within 60 days
before the expiration
of the CSA. (See Art.
253 &
Not applicable. No
freedom period.
Petition can befiled
anytime.
Must be duly
supported by 25% of
all the members of the
appropriate bargaining
unit (ABU).
No substantial support
rule.
Why? Intention of law is
to bring in the union, to
implement policy
behind Art. 211(a).
Percentage base: all
members of an ABU.
Note: The approval of the PCE in an unorganized
bargaining unit is NEVER appealable, the reason
being that the law wants the ununionized to be
unionized.
Q: Should the consent signatures of at
least 25% of the Ees in the bargaining unit
be submitted simultaneously with the filing
of the petition for certification election
(peE)?
A: No, the administrative rule requiring the
simultaneous submission of the 25% consent
signatures upon the filing of PCE should not
be strictly applied to frustrate the detenmination
of the legitimate representative of the workers.
Accordingly, the Court held that the mere filing
of a PCE within the freedom period is sufficient
basis for the issuance of an order for the
holding of a CE, subject to the submission of
the consent signatures within a reasonable
period from such filing. (Port Workers Union of
the Phils. v. Laguesma, G.R. Nos. 94929-30
Mar. 18, 1992) ,
Q: Who may file a petition for certification
election (peE)?
A:
1. Any legitimate labor organization
(LLO)
2. A national union or federation which
has already issued a charter
124
certificate to its local chapter
participating in the CE
3. A local chapter which has been
issued a charter certificate
4. An Er only when requested to bargain
collectively in a bargaining unit where
no registered CSA exists. (Sec 1,
Rule VIII, Book V, IRR as amended
by D. O. 40-F-03)
Note: A national union or federation filing a
petition in behalf of its local/chapter shall not be
required to disclose the names of the
local/chapter's officers and members, but shall
attach to the petition the charter certificate it
issued to its local/chapter. (Sec. 1, Rule VIII,
Book V, IRR as amended by D. O.40-F-03)
Q: Mayan employee intervene in the
petition for certification election (peE)?
A: Yes, for the purpose of protecting his
individual right. (Sec. 1, Rule VIII, Book V, IRR
as amended by 0.0.40-03)
Q: Where is peE filed?
A: It shall be filed with the Regional Office
which issued the petitioning union's certificate
of registration/certificate of creation of
chartered local. (Implementing Rules, as
amended by D.O. 40-03)
Q: Who shall hear and resolve the peE?
A: The Mediator-Arbiter.
Q: When to file peE?
A: The proper time to file the PCE depends on
whether the Certified Bargaining Unit has a
CSA or not:
1. If it has no CBA, the petition may be
filed anytime outside the 12-month
bar (certification year).
2. If it has CBA, it can be filed only
within the last 60 days of the s" year
of the CBA.
Note: At the expiration of the freedom period, the
Er shall continue to recognize the majority status
of the incumbent bargaining agent where no PCE
is filed.
Q: Distinguish union election from
certification election.
A:
,
ONION ELECTION
CERTIFICATION
, !-,;.;~ . ELECTION
Held pursuant to the The process is ordered
union's constitution and supervised by
and by-laws DOLE
All Ees whether union
Right to vote is or non-union members
enjoyed only by union who belon~to the.,
members appropriate bargaining
unit can vote
The winner in a CE is
Winners of union
an entity, a union,
election become
which becomes the
officers and
representative of the
representatives of the
whole bargaining unit
union only
that includes even the
members of the
defeated unions.
Note: Both in CE and union election, the
prescribed procedures should be followed.
Q: Can a "no-union" win in a ceriification
Election (CE)?
A: Yes. Because the objective in a CE is to
ascertain the majority representation of the
bargaining representative, if the Ee's desire to
be represented at all by anyone. Hence, no
union is one of the choices in aCE, (2006 Bar
Question)
Alternative Answer:
No. A no union cannot win in a CEo The
purpose of a CE is to select an excusive
bargaining agent and a no union vote would
precisely mean that the voter is not choosing
any of the contending unions. If the no- union
votes constitute a majority of the valid votes
cast, this fact will all the more mean that no
union won in CEo A one-year bar will
consequently stop the holding of another CE to
allow the Er to enjoy industrial peace for at
least one year.
Q: In what instance may a PCE be filed
outside the freedom period of a current
CBA?
A: As a general rule, in an establishment
where there is a CBA in force and effect, a
PCE may be filed only during the freedom
period of such CBA. But to have that effect, the
CBA should have been filed and registered
with the DOLE. (Art 231, 253-A and 256, LC).
(1997 Bar Question)
Thus, a CBA that has not been filed and
registered with the DOLE cannot be a bar to a
CE and such election can be held outside the
freedom period of such CBA.
Alternative Answer:
A PCE may be filed outside the freedom
period of a current CBA if such CBA is a
new CBA that has been prematurely entered
into, meaning, it was entered into before
the expiry date of the old CBA. The filing of
the PCE shall be within the freedom period of
the old CBA which is outside the freedom
period of the new CSA that had been
prematurely entered into.
Q: Are probationary employees (Ees)
entitled to vote in a CE? Why?
A: In a CE, all rank-and-file Ees in the
appropriate bargaining unit (ABU) are entitled
to vote. This principle is clearly stated in
Art. 255 of the LC which states that the "labor
organization designated or selected by the
majority of the Ees in such unit shall be the
exclusive representative of the Ees in such
unit for the purpose of collective bargaining
(CB)."
CB covers all aspects of the employment
relation and the resultant CBA negotiated by
the certified union binds all Ees in the
bargaining unit. Hence, all rank- and-file Ees,
probationary or permanent, have a substantial
interest in the selection of the bargaining
representative. The LC makes no distinction
as to their employment status as basis for
eligibility to vote in the petition for CEo The
law refers to "all" the Ees in the bargaining
unit. All they need to be eligible to vote is to
belong to the "bargaining unit," (Airtime
Specialists, Inc. V. Ferrer-Calleja, G.R. No.
80612-16, Oec. 29, 1989). (1999 Bar
Question)
Q: What is direct certification?
A: It is the process whereby the Med-Arbiter
directly certifies a labor organization of an
appropriate bargaining unit (ABU) of a
company after a showing that such petition is
supported by at least a majority of the Ees in
the bargaining unit.
Q: Does the failure of SAMAFIL (an
independent union) to prove its affiliation
with NAFLU-KMU federation affect its right
to file a PCE as an independent union?
A: No, as a LLO, it has the right to file a PCE
on its own beyond question. Its failure to prove
its affiliation with the NAFLU-KMU cannot
affect its right to file said PCE as an
independent union. At the most, its failure will
result in an ineffective affiliation -,yith NAFLU-
UN!V E R S ITY OF SANTO TOM.A~ ~li! 125
Pacu(taa de CDer ecl i o Cl'lld "i,
KMU. Despite affiliation, the local union
remains the basic unit free to serve the
common interest of ali its members and pursue
its own interests independently of the
federation. (Samahan ng mga Manggagawa
sa Filsystems v. SLE, G.R. No. 128067, June
5, 1998)
Q: May illegally dismissed Ees of the
company participate in the certification
election (CE)?
A: Yes, it is now well-settled that Ees who
have been improperly laid off but who have at
present an unabandoned right to or
expectation of re-employment, are eligible to
vote in CE's. Thus, and to repeat, if the
dismissal is under question, as in the case
now at bar whereby a case of iliegal dismissal
and/or ULP was filed, the Ee's concerned
could still qualify to vote in the elections. (Phi/.
Fruits & Vegetables Industries v. Torres, G.R.
No. 92391, July 3, 1992)
Q: Is direct certification (DC) still allowed?
A: No. Even in a case where a union has filed
a petition for CE, the mere fact that there was
no opposition does not warrant a DC. More so
in a case when the required proof is not
presented in an appropriate proceeding and
the basis of the DC is the union's self-serving
assertion that it enjoys the support of the
majority of the Ees, without subjecting such
assertion to the test of competing claims.
(Samahang Manggagawa sa Permex v.
Secretary, G.R. No. 107792, Mar. 2, 1998)
Q: Can the BLR certify a union as the
exclusive bargaining representative after
showing proof of majority representation
thru union membership cards without
conducting an election?
A: No. The LC (In Arts. 256, 257 and 258)
provides only for a CE as the mode for
determining the exclusive collective
bargaining representative if there is a
question of representation in an appropriate
bargaining unit. (1998 Bar Question)
Q: What is a consent election?
A: An election voluntarily agreed upon by the
parties, with or without the intervention by
DOLE. (Sec. 1(hi, Rule I, Book V, IRR)
Note: To afford an individual employee-voter an
informed choice where a local/chapter is the
petitioning union, the local/chapter shall secure
its certificate of creation at least 5 working days
before the date of the consent election. (Sec.1,
Rule VIII, Book V, IRR as amended by DO 40-F-
03)
Q: What are the requisites before a labor
union can be declared a winner (double
majority rule)?
A:
1. Majority of the eligible voters cast
their votes.
2. Majority of the valid votes cast is for
such union.
Q: How to determine the double majority
rule?
A:
1. In determining the eligible votes cast
(first majority) include spoiled ballots
2. In determining valid votes (second
majority), eliminate spoiled ballots but
included the challenged votes.
Q: A certification election was conducted
among the rank-and-file Ees of Holiday Inn
Manila Pavilion Hotel. In view of the
significant number of segregated votes,
contending unions, National Union of
Workers in Hotels, Restaurants and Allied
Industries-Manila Pavilion Hotel Chapter
(NUWHRAIN-MPHC) and Holiday Inn Manila
Pavilion Hotel Labor Union (HIMPHLU),
referred the case back to the Med-Arbiter to
decide which among those votes would be
opened and tallied. 11 votes were initially
segregated because they were cast by
dismissed Ees, albeit the legality of their
dismissal was still pending before the CA.
6 other votes were segregated because the
Ees who cast them were already occupying
supervisory posltions at the time of the
election. Still 5 other votes were
segregated on the ground that they were
cast by probationary Ees and, pursuant to
the existing CBA, such Ees cannot vote.
NUHWHRAIN-MPHC further avers that
HIMPHLU, which garnered 169 votes,
should not be immediately certified as the
bargaining unit, as the opening of the 17
segregated ballots would push the number
of valid votes cast to 338, hence, the 169
votes which HIMPHLU garnered would be 1
vote short of the majority which would then
become 170.
Was HIMPHLU able to obtain the required
majority for it to be certified as the
exclusive bargaining agent?
A: No, it is well-settled that under the "double
majority rule" for there to be a valid certification
election, majority of the bargaining unit must
have voted and the winning union must have
garnered majority of the valid votes cast.
Following the ruling that all the probationary
Ees votes should be deemed valid votes while
that of the supervisory Ees should be
excluded, it follows that the number of valid
votes cast would increase. Under Art. 256 of
the LC, the union obtaining the majority of the
valid votes cast by the eligible voters shall be
certified as the sole exclusive bargaining agent
of all the workers in the appropriate bargaining
unit. This majority is 50% + 1, intthis case at
least 170. HIMPHLU obtained 169, clearly it
was not able to obtain a majority vote.
(NUWHRAIN -MPHC v. SLE, G.R. No.
181531, July 31,2009, J . Carpio-Morales)
Q: What is a run-off election?
A: An election conducted when:
1. An election which provides for 3 or
more choices results in none of the
contending unions receiving a
majority of the valid votes cast, and
2. There are no objections or challenges
which if sustained can materially alter
the results, provided
3. The total number of votes for all the
contending unions is at least 50% of
the number of votes cast. (Sec. 1,
Rule X, Book V, IRR)
4. Not one of the choices obtained the
majority of the valid votes cast (50%+
1 second majority);
5. The two choices which garnered the
highest votes will be voted and the
one which garners the highest
number of votes will be declared the
winner provided they get the majority
votes of the total votes cast.
Q: Who are the choices in a run-off
election?
A: The unions receiving the highest and 2
nd
highest number of the votes cast. (Sec. 2, Rule
X, Book V, IRR)
Note: "No Union" shall not be a choice in the run-
off election
PacuCtaa ae l 1)er ecno Ci vi C
127
Q: Distinguish certification election, consent election, direct certification, and run-off and re-run
elections.
A:
To determine the sole and exclusive bargaining
agent of all the Ees in an appropriate bargaining unit
for the purpose of collective bargaining.
odetermine the issue majority I of
all the workers in the appropriate CB unit mainly for
the purpose of determining the administrator of the
CBA when the contracting union suffered massive
disaffiliation and not for the purpose of determining
the ent for of CB.
is directly cert as an appropriate
bargaining unit of a company upon showing that
petition is supported by at least a majority of the Ees
in the bargaining unit.
allowed.
Requires petition CE filed by a union or Er. A
Med-Arbiter grants the petition and an election
officer is designated by regional director to supervise
the election.
Note: Med-Arbiter may determine if there is Er-Ee
r<>",tir.,nc: h,;n and if the voters are
~~~
Held by agreement of the unions with or without the
participation of the Med-Arbiter.
Med-Arbiter union is the
exclusive CB representative of the Ees of an
appropriate bargaining unit without holding a CE, but
merely on the basis of evidence of in support of the
union's claim that is the choice of the majority of the
Ees.
Takes place
1. If one choice receives a plurality of the vote and
the remaining choices results in atie; or
2. If all choices received the same number of votes.
union is also a choice.
Note: Petition for cancellation of registration is not a bar to a PCE. No prejudicial question shall be
entertained in a petition for certification election. (D. O. 40-03)
(0 BARS TOCERTIFICATION ELECTlON(CE)'
Q: What are the grounds for denying the
PCE?
A:
1. The petitioning union or federation is
not listed in the DOLE's registry of
legitimate labor unions or that its
registration certificate legal
personality has been revoked or
cancelled with finality
2. Failure of a local chapter or national
union/federation to submit a duly
issued charter certificate upon filing of
the petition
128
3. The petition was filed before or after
the FREEDOM PERIOD of a duly
registered GBA; provided that the 60-
day period based on the original GBA
shall not be affected by any
amendment, extension or renewal of
the GBA; (contract bar rule)
4. The petition was filed within 1 year
from entry of voluntary recognition or
within the same period from a valid
certification, consent or run-off
election and no appeal on the results
of the certification, consent or run-off
election is pending; (12-month bar;
certification year bar rule)
Q: UNlOAD, a labor organization claiming
to represent the majority of the rank and
file workers of BAGSAK Toyo
Manufacturing Corp. (BMTC), filed a
petition for CE during the freedom
period obtaining in said corp. Despite
the opposition thereto by SIGAW
Federation on the ground that UNlOAD was
not possessed with all the attributes
5. A duly certified union has
commenced and sustained
negotiations with the Er in
accordance with Art. 250 of the LC
within the 1-year period. (negotiation
bar rule)
5. There exists a bargaining deadlock
which had been submitted to
conciliation or arbitration or had
become the subject of a valid notice
of strike or lockout to. which an
incumbent or certified' batg~ining
agent is a party. (deadlock bar rule)
7. In case of an organized
establishment, failure to submit the
25% support req't for the filing of the
PCE.
8. Non-appearance of the petitioner for
2 consecutive scheduled conferences
before the med-arbiter despite due
notice, and
9. Absence of Er-Ee relationship
between all the members of the
petitioning union and the owner of the
establishment where the proposed
bargaining unit is sought to be
represented. (Sec. 14[a), Rule VIII,
Book V, IRR, as amended by D.O.
40-F-03)
Q: What is a prohibited ground for the
denial/suspension of the petition for
certification election?
A: The inclusion as union members of Ees
outside the bargaining unit. Said Ees are
automatically deemed removed from the list of
membership of said unions.
Q: Does the filing of a petition to cancel the
petitioner's registration cause the
suspension or dismissal of the petition for
certification election?
A: No. To serve as a ground for dismissal of a
PCE, the legal personality of the petitioner
should have been revoked or cancelled "with
finality".
of a duly registered union, the Med-
Arbiter issued an order calling for a CE on
J uly 25, 2001. This order was promulgated
and served on the parties on J uly 12,
2001. On J uly 14, 2001, UNlOAD submitted
and served the required documents for its
registration as an independent union, i
which documents were 'approved by the
DOLE on J uly 15,2001.
During the elections, UNlOAD won over
SIGAW. SIGAW questioned UNlOAD's
victory on the ground that UNlOAD was
not a duly registered union when it filed the
petition for a CEo Shall SIGAW's case
prosper or not? Why?
A: No, SIGAW's case will not prosper. The
application of technicalities of procedural
req'ts in CE disputes will serve no lawful
objective or purpose. It is a statutory policy
that no obstacles should be placed on the
holding of aCE, (Samahang ng Manggagawa
sa Pacific Plastic vs. Laguesma, GR. No.
111245, Jan. 31, 1997) and that the law is
indisputably partial to the holding of a CE.
(Western Agusan vs. Trajano G.R. No. 65833,
May 6, 1991)
At any rate, UNlOAD completed all the req'ts
for union registration on J uly 14,2001, and
legitimate union status was accorded on J uly
15, 2000, or at least 10 days before the.
scheduled date for holding the CEo(2001 Bar
Question)
Q: What is meant by "contract-bar rule"?
A: Contract-bar rule means that while a valid
and registered CSA is subsisting, the BLR is
not allowed to hold an election contesting the
majority status of the incumbent union except
during the 50-day period immediately prior to
its expiration, which period is called the
freedom period.
Note: In the absence of such timely notice or
filing of petition, the contract executed during the
automatic renewal period is a bartoCEo
There shall be no amendment, alteration, or
termination of any of the provisions of the CSA
except to give notice of one party's intention to
amend, alter and terminate the provisions within
the freedom period.
Pacu[ taa ae (] )er ecno Ci vi C
Q: What are the req'ts in order to invoke
the contract bar rule?
A: The existing CBA must:
1. Be in writing and signed by all
contracting parties
2. Contain the terms and conditions of
employment
3. Cover employees in an appropriate
bargaining unit
4. Be for a reasonable period or
duration
5. Be ratified
6. Be registered with the SLR; and
7. The violation of the contract bar rule
or the existence of a duly registered
CSA must be specially pleaded as a
defense.
Q: What is the effect of an invalid or
unregistered eBA?
A: There is no bar and therefore a certification
election may be held.
Note: Registration of CSA only puts into effect
the contract-bar rule but the CSA itself is valid
and binding even if unregistered.
Q: What are the exceptions to the contract
bar rule?
A:
1. The CSA is unregistered
2. The CSA is inadequate and
incomplete
3. The CSA was hastily entered into
(Doctrine of premature extension)
4. Withdrawal of affiliation from the
contracting union brought about by
schism or mass disaffiliation
5. Contract where the identity of the
representative is in doubt. (ALU v.
Ferrer Calleja, G.R. No. 85085, Nov.
6, 1989)
6. CSA entered into between the Er and
the union during the pendency of a
petition for CE (Vassar Industries Ees
Union v. Estrella, G.R. No. L-46562,
Mar. 31, 1978)
7. CBA conducted between the Er and
the union is not bar to a certification
election filed by another union and
said CSA can be renegotiated at the
option of the new bargaining agent.
(ATU v. Hon. Noriel, G.R. No. L-
48367, Jan. 16, 1979)
8. A CBA registered with falsified
supporting documents
9. CSA was concluded in violation of an
order enjoining the parties from
entering into a CSA until the issue of
representation is resolved
10. Petition is filed during the 50-day
freedom period.
Note: Basic to the contract bar rule is the
proposition that the delay of the right to select
representatives can be justified only where
stability is deemed paramount. Excepted from the
contract bar rule are certain types of contracts
which do not foster industrial stability, such as
contracts where the identity of the representative
is in doubt. Any stability derived from such
contracts must be subordinated to the Ees'
freedom of choice 'because it does not establish
the type of industrial peace contemplated by law.
(Firestone Tire & Rubber Company Ee's Union v.
Estrella, G.R. No. L-45513-14, Jan. 6, 1978)
Q: What is the successor- in-interest
doctrine?
A:
GR: It is when an Er with an existing CSA
is succeeded by another Er, the successor-
in-interest who is the buyer in good faith
has no liability to the Ees in continuinq
employment and the bargaining agreement
because these contracts are in personam.
XPNs:
-1-.-When the successor-in-interest
expressly assumes an obligation;
2. The sale is a device to circumvent the
obligation; or
3. The sale or transfer is made in bad
faith.
Q: What is the substitutionary doctrine?
A: It is where there occurs a shift in the Ees
union allegiance after the execution of a
collective bargaining (CS) contract with the Er,
the Ees can change their agent (labor union)
but the CS contract which is still subsisting
continues to bind the Ees up to its expiration
date. They may however, bargain for the
shortening of said expiration date.
Note: The Er cannot revoke the validly executed
CS contract with their Er by the simple expedient
of changing their bargaining agent. The new
agent must respect the contract. (Benguet
Consolidated Inc. v. BCI Ees and Worker's
Union-PAFLU, GR. No. L-24711, April 30, 1968)
It cannot be invoked to support the contention
that a newly certified CS agent automatically
assumes all the personal undertakings of the
former agent-like the "no strike clause" in the
CBA executed by the latter.
Q: When does deadlock arise?
A: It arises when there is an impasse, which
presupposes reasonable effort at good faith
bargaining which, despite noble intentions, did
not conclude in an agreement between the
parties.
Q: What is deadlock bar rule?
A: A petition for certification election (PCE)
cannot be entertained if, beforeth!)lfiling of the
PCE, a bargaining deadlock to which an
incumbent or certified bargaining agent is a
party, had been submitted to conciliation or
arbitration or had become the subject of a
valid strike or lockout.
Q: What are the indications of a genuine
deadlock?
A:
1. The submission of the deadlock to a
third party conciliator or arbitrator;
and
2. The deadlock is the subject of a valid
notice strike or lockout. -
Q: Capitol Medical Center Ees' Association-
Alliance of Filipino Workers (CMCEA-AFW)
emerged as the certified representative of
the rank-and-file Ees at Capitol Medical
Center (CMC). Due to CMC's refusal to
bargain collectively, CMCEA-AFW filed a
notice of strike and later on staged the
strike after complying with the other legal
req'ts. The SLE assumed jurisdiction over
the case and issued an order certifying the
same to the NLRC for compulsory
arbitration. During all of these events
Capitol Medical Center Alliance of
Concerned employees (Ees)-Unified
Filipino Service Workers filed a petition for
CE among the regular rank-and-file Ees of
CMC. The petition for CE was dismissed
and the CMC was directed to negotiate with
CMCEA-AFW. Was the dismissal of the
PCE proper?
A: Yes, if the law proscribes the conduct of a
CE when there is a bargaining deadlock
submitted to conciliation or arbitration, with
more reason should it not be conducted if,
despite attempts to bring an Er to the
negotiation table by the certified bargaining
agent, there was "no reasonable effort in good
faith" onthe Erto bargaincollectively.
floodgates will be opened for the
circumvention of the law by unscrupulous Ers
to prevent any certified bargaining agent from
negotiating a CBA. Sec. 3, (Rule VIII), Book V
of the IRR should be interpreted liberallyso as
to include a circumstance where a CBA could
not be concluded due to the failure of one
party to willingly perform its duty to bargain
collectively. (Capdol Medical Center Alliance
of Concerned Ees v. Laguesma, GR. No.
118915, Feb. 4, 1997)
Q: Should the certification election
proceedings be suspended in view of the
pending case for cancellation of the
union's certificate of registration?
A: No, the pendency of a cancellation case is
not a groundfor the dismissal or suspensionof
a representation proceeding considering that a
registered labor organization (LO) continues to
be a legitimate one entitled to all the rights
appurtenant thereto until a final valid order is
issuedcancelling suchregistration.
Once a LOattains the status of a LLOit begins
to possess all of the rights and privileges
granted by lawto such organizations. As such
rights and privileges ultimately affect areas
which are constitutionally protected, the
activities in which LO, associations and unions
are engaged directly affect the public interest
and should be zealously protected.
(Progressive Dev't Corp. v. SLE, G.R. No.
115077, April 18, 1997)
Q: What is negotiation bar rule?
A: A PCE cannot be entertained if, before the
filing of the PCE, the duly recognized or
certified union has commenced negotiations
with the Er in accordance with Art. 250 of the
LC.
Q: What is certification year rule?
A: No PCE may be filed within one year from
the dateof a valid certification, consent, or run-
off election or from the date of voluntary
recognition.
ART. 258-A. EMPLOYER AS A BYSTANDER
Q: What is the concept of an Er as a
bystander?
A: In all cases, whether the petition for
The circumstances in this case should be certification election (PCE) is filed by an Er or
considered as similar in nature to a a legitimate labor organization, the Er shall not
"bargaining deadlock" when no CE could be be considered a party thereto with a
held. This is also to make sure that no concomitant rightto oppose a P,CE.
UN I V E R SIT Y 0 F SAN ToT 0 MAS ~. 131
Pacu{ taa ae (] )er ecl i o Ci vi C " " ."
Note: Er's participationshall be limitedto:
1. Being notifiedor informedof petitions of
suchnature;
2. Submittingthe list of Ees duringthe pre-
election conference should the Med-
Arbiter act favorably onthe petition.
Q: May the company actively participate in
the conduct of the election in order to see
to it that the election is clean, peaceful,
orderly and credible?
A: Yes, the manner in which the election was
held could make the difference between
industrial strife and industrial harmony in the
company. What an Er is prohibited from doing
is to interfere with the conduct of the
certification election for the purpose of
influencing its outcome. But certainly an Er has
an abiding interest in seeing to it that the
election is clean, peaceful, orderly and
credible. (National Federation of Labor v. SLE
and Hijo Plantation Inc., G.R. No. 104556,
Mar. 1g, 1998)
Q: PT & T Supervisory Ees Union filed a
petition for the holdlnq of a certification
election (CE) among the supervisory Ees
of the PT&T Company. The company
moved to dismiss the petition on the
ground that union members were
performing managerial functions and were
not merely supervisory Ees. The company
also alleged that a certified bargaining unit
existed among its rank and file Ees
which barred the filing of the petition.
1. Does the company have the
standing to file the motion to
dismiss? Explain.
2. If you were the Med-Arbiter,
how would you resolve the
petition.
3. What is the proper remedy of an
Er to ensure that the Ees are
qualified to hold aCE?
A:
1. No, the company has no standing
to file the motion to dismiss as the Er
has no right to interfere in a purely
union matter or concern. (Phil. Fruits
and Vegetable Industries, Inc. v.
Torres, G.R. No. 92391, July 3, 1992)
A CE is the sole concern of the
workers and the Er is regarded as
nothing more than a bystander with
no right to interfere at all in the
election.
2. As the med arbiter, I will:
a. Deny, for lack of merit, the Er's
motion to dismiss the Union's
PCE
b. Proceed to hear the merits of the
petition, especially:
i. The appropriation of the
claimed bargaining unit;
ii. Inclusion and exclusion of
voters, or the proposed voter
list; and
iii. If the petition is in order, to
set the date, time and place
of the election.
3. The Er has no remedy. The petition
for CE was initiated by the union;
hence, the Er is a total stranger or a
bystander in the election process.
(Phil. Fruits and Vegetable
In d u s t r i e s , Inc. v. Torres,
G.R. No. 92391, July 3, 1992)
4. To allow an Er to assert a remedy is
an act of interference in a matter
which is purely a concern of the
Union. (1996 Bar Question)
Academics Committee
Vi ce-Chai r for Academi cs: J eannie A Laurentino
Vi ce-Chai r for L ayout &Desi gn: Loise Rae G.Naval
Labor LawCommittee
Assi stant Sl I bj ect H ead' Domingo B.Diviva V
Members:
ChristianNinoA.Diaz
A.ngeloS.Diokno
Genesis R.Fulgencio
J eanelleC.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
:~"'~STRIKES;iOCKOUTS'AND CONCERTED
I' - -,. , .. ACTION-S-:' - ~
Q: What is the constitutional basis of
strikes, lockouts and other concerted
activities?
A: The State 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 (Sec. 3, A~. XIII,,1987
Constftution) .
Note: The law does not look with favor upon
strikes and lockouts because of. their disturbing
and pernicious effects upon the social order and
the public interests; to prevent or avert them and
to implement Sec. 6, Art. XIV of the Constitution,
the law has created several agencies, namely:
the BLR, the DOLE, the Labor Management
Advisory Board, and the CIR. (Luzon Marine
Dev't Union v. Roldan, G.R. No. L-2660, May 30,
1950)
Q: What is a concerted action?
A: It is an activity undertaken by 2 or more
employees, by one on behalf of the others.
Q: Are all concerted actions strikes?
A: Not all concerted activities are strikes. They
may only be protest actions - they do not
necessarily cause work stoppage by the
protesters. A strike in contrast is always a
group action accompanied by work stoppage.
Q: The Ees wrote and published a letter to
the bank president, demanding his
reSignation on the grounds of immorality,
nepotism, favoritism and discrimination in
the appointment and promotion of bank
Ees. The bank dismissed the 8 Ees on the
alleged libelous letter. Were the Ees
engaged in a concerted activity?
A: Yes, assuming that they acted in their
individual capacities when they wrote the
letter, they were nonetheless protected, for
they were engaged in a concerted activity, in
their right of self-organization that includes
concerted activity for mutual aid and
protection. Any interference made by the
company will constitute as ULP.
(Republic Savings Bank v. CIR, G.R. No. L-
20303, Oct. 31, 1967)
Q: What is a strike?
A: It means any temporary stoppage of work
by the concerted action of employees as a
result of an industrial or labor dispute. (Sec. 1
[uu), Rule I, Book V, IRR)
It shall comprise not only concerted work
stoppages, but also slowdowns, mass leaves,
sitdowns, attempt to damage, destroy or
sabotage plant equipment and facilities, and
similar activities. (Samahang Manggagawa sa
Sulpicion Lines v. Sulpicio Lines, Inc., G.R.
No. 140992, Mar. 25, 2004)
Q: What is the purpose of a strike?
A: A strike is a coercive measure resorted to
by laborers to enforce their demands. The idea
behind a strike is that a company engaged in a
profitable business cannot afford to have its
production or activities interrupted, much less,
paralyzed. (Phil. Can Co. v. CIR, G.R. No. L-
3021, July 13, 1950)
Q: What is a lockout?
A: It means any temporary refusal of an
employer to furnish work as a result of an
industrial or labor dispute. (Art. 212 [pJ)
Q: What is picketing?
A: It is the act of marching to and fro the
employers premises which is usually
accompanied by the display of placard and
other signs, making known the facts involved
in a labor dispute.
The right to picket as a means of
communicating the facts of a labor dispute is a
phase of the freedom of speech guaranteed by
the Constitution. If peacefully carried out, it can
not be curtailed even in the absence of Er-Ee
relationship. (PAFLU v. Cloribel, G.R. No. L-
25878, Mar. 28, 1969)
Q: Is the right to picket an absolute right?
A: No, while peaceful picketing is entitled to
protection as an exercise of free speech, the
courts are not without power to confine or
localize the sphere of communication or the
demonstration to the parties to the labor
dispute, including those with related interests,
and to insulate establishments or persons with
no industrial connection or having interest
totally foreign to the context of the dispute.
(Liwayway Pub., Inc. v. Permanent Concrete
The joining in protests or demands, even by a
small group of Ees, if in furtherance of their
interests as such is a concerted activity
protected by the Industrial Peace Act. It is not
necessary that union activity be involved or
that collective bargaining be contemplated,
UNIVERSiTY OF SANTO TOMAS \::~) 133
PacuCtaa ae < Der ecl i o Ci vi C ' .'
LABOR RELATIONS: STRIKES, LOCKOUTS AND CONCERTED ACTIONS
Workers Union, G.R. No. L-25003, Oct. 23,
1981)
Q: Who is a strike-breaker?
A: Any person who obstructs, impedes, or
interferes with by force, violence, coercion,
threats, or intimidation any peaceful picketing
affecting wages, hours or conditions of work or
in the exercise of the right of self-organization
or collective bargaining. (Art. 212 [r))
Q: What is a strike area?
A: It means the establishment, warehouses,
depots, plants or offices, including the sites or
premises used as runaway shops, of the Er
struck against, as well as the immediate
vicinity actually used by picketing strikers in
moving to and fro before all points of entrance
to and exit from said establishment. (Sec. 1
[wi, Rule I, Book V, IRR)
Q: What is an internal union dispute?
A: It includes all disputes or grievances arising
from any violation of or disagreement over any
provision of the constitution and by laws of a
union, including any violation of the rights and
conditions of union membership provided for in
this i.c.(Art. 212 [qj)
Q: What is a boycott?
A: It is an attempt, by arousing a fear of loss,
to coerce others, against their will to withhold
from one denominated "unfriendly to labor"
their beneficial business intercourse.
Q: What is a slowdown?
A: It is a method by which one's employees,
without seeking a complete stoppage of work,
retard production and distribution in an effort to
compel compliance by the employer with the
labor demands made upon him.
Q: Does an "overtime boycott" or "work
slowdown" by the employees constitute a
strike and hence a violation of the CBA's
"No strike, no lockout" clause?
A: Yes, the concept of a slowdown is a "strike
on the installment pian." It is a willful reduction
in the rate of work by concerted action of
workers for the purpose of restricting the
output of the employer (Er), in relation to a
labor dispute; as an activity by which workers,
without a complete stoppage of work, retard
production or their performance of duties and
functions to compel management to grant their
demands.
134
Such a slowdown is generally condemned as
inherently illicit and unjustifiable, because
while the employees (Ees) "continue to work
and remain at their positions and accept the
wages paid to them," they at the same time
"select what part of their allotted tasks they
care to perform of their own volition or refuse
openly or secretly, to the Er's damage, to do
other work;" in other words, they "work on their
own terms." (Interphil Laboratories Ees Union-
FFW v. Interphil Laboratories, Inc., G.R. No.
142824,Oec. 19,2001)
Q: What are the characteristics of a strike?
A:
1.
2.
3.
4.
5.
6.
An Er-Ee relationship
Existence of a labor dispute
Employment relation is deem.ed to
continue although in a state of
belligerent suspension
Temporary work stoppage
Work stoppage is done through
concerted action
The striking group is a legitimate
labor organization; in case of a
bargaining deadlock, it must be the
employees' sole bargaining
representative
Q: PAL dismissed strike leader Capt.
Gaston as a result of which the Union
resolved to undertake the grounding of all
PAL planes and the filing of applications
for "protest retirement" of members who
had completed 5 years of continuous
service, and "protest resignation" for those
who had rendered less than 5 years of
service in the company. PAL
acknowledged receipt of said letters and
among the pilots whose "protest
reslqnatlcn or retirement" was accepted by
PAL were Enriquez and Ecarma.
Before their readmission, PAL required
Enriquez and Ecarma to accept 2
conditions, namely: that they sign
conformity to PAL's letter of acceptance of
their retirement and or reslqnatlon and that
they submit an application for employment
as new employees (Ees) without protest or
reservation. As a result of this their
seniority rights were lost.
Are the pilots entitled to the restoration of
their seniority rights?
A: No, an Ee has no inherent right to
seniority. He has only such rights as may be
based on a contract, statute, or an
administrative regulation relative thereto.
Seniority rights which are acquired by an Ee
through long-time employment are contractual
and not constitutional. The discharge of an Ee
thereby terminating such rights would not
violate the Constitution. When the pilots
tendered their respective retirement or
resignation and PAL immediately accepted
them, both parties mutually terminated the
contractual employment relationship between
them thereby curtailing whatever seniority
rights and privileges the pilots had earned
through the years.
,1 ~
Q: Does the action of the Ees of PAL fall
under the ambit of concerted actions
protected by law1
A: No, the pilot's mass action was not a strike
because Ees who go on strike do not quit their
employment. Ordinarily, the relationship of Er
and Ee continues until one of the parties acts
to sever the relationship or they mutually act to
accomplish that purpose. As they did not
assume the status of strikers, their "protest
retirement/resignation" was not a concerted
activity which was protected by law. (Enrique
v. Zamora, G.R. No. L-51382, Dec. 29, 1986)
Q: What is a labor dispute? -
A: Any controversy or matter concerning terms
or conditions or representation of persons in
negotiating, fixing, maintaining, changing or
arranging the terms and conditions of
employment, regardless of whether or not the
disputants stand in the proximate relation of
Ers and Ees. (Gold City Integrated Port
Services, Inc. v. NLRC, G.R. No. 103560, July
6, 1995)
Q: When is a person or entity considered
as partiCipating or interested in a labor
dispute?
A:
1. If relief is sought against him or it,
and
2. He or it is engaged in the same
industry, trade, craft, or occupation in
which such dispute occurs, or
3. Has a direct or indirect interest
therein, or
4. Is a member, officer, or agent of any
association composed in whole or in
part of employees or employers
engaged in such industry, trade, craft,
or occupation.
Q: Liwayway Publication Inc. is a second
sub lessee of a part of the premises of the
Permanent Concrete Products, Inc. It has a
bodega for its newsprint in the sublet
property which it uses for its printing and
publishing business. The daily supply of
newsprint needed to feed its printing plant
is taken from its bodega. The Ees of the
Permanent Concrete Products Inc. declared
a strike against their company. The union
members picketed, stopped and prohibited
Liwayway's trucks from entering the
compound to load newsprint from its
bodega.
Does the lower court have jurisdiction to
issue a writ of preliminary injunction
considering that there was a labor dispute
between Permanent Concrete Products,
Inc. and the union?
A: Yes, Liwayway is not in anyway related to
the striking union except for the fact that it is
the sub- lessee of a bodega in the company's
compound.
The business of Liwayway is exclusively the
publication of magazines which has absolutely
no relation or connection whatsoever with the
cause of the strike of the union against their
company, much less with the terms, conditions
or demands of the strikers. Liwayway is merely
a 3
rd
person or an innocent by-stander.
(Liwayway Pub., Inc. v. Permanent Concrete
Workers Union, G.R. No. L-25003, Oct. 23,
1981)
Q: Because of financial problems, the
company decided to temporarily shutdown
its operations at the dyeing and finishing
division. It notified the DOLE of the
shutdown. Raymund Tomaroy with 16
members of the union staged a picket in
front of the company's compound, carrying
placards. He demanded a resumption of
work and 13
th
month pay. The company
filed a petition to declare the strike illegal.
The union argues that they did not stage a
strike, for considering that the dyeing and
finishing division of the company was shut
down, it could not have caused a work
stoppage. Was the action of the union a
strike?
A: Yes, the concerted efforts of the members
of the union and its supporters caused a
temporary work stoppage. The allegation that
there can be no work stoppage because the
operation in the division had been shut down is
of no consequence. It bears stressing that the
other divisions were fully operational.
(Bukluran ng Manggagawa sa C/othman
Knitting Corp. v. CA, G.R. No. 158158, Jan. 17,
2005)
Pacu[ taa de l Der ecfzo CiviC
LABOR RELATIONS: STRIKES, LOCKOUTS AND CONCERTED ACTfONS
Q: What are the types of strike?
A:
1. Economic strike - used to secure the
economic demands such as higher
wages and better working conditions
for the workers
2. ULP strike - protest against ULP of
management
Q: Give examples of strike and explain their
legality.
A:
1. Sit-down strike - Characterized by a
temporary work stoppage of workers
who seize or occupy property of the
Er or refuse to vacate the premises of
the Er.
II/egal - Amounts to a
criminal act because of the
Ee's trespass on the
premises of the Er
2. Wildcat strike - A work stoppage that
violates the labor contract and is not
authorized by the union.
II/egal -Because it fails to
comply with certain req'ts of
. the law, to wit: notice of
strike, vote and report on
strike vote
3. Slowdown - Strike on an installment
plan; an activity by which workers,
without complete stoppage of work,
retard production or their
performance of duties and functions
to compel management to grant their
demands
II/egal - Ees work on their
own terms; while the Ees
continue to work and remain
in their positions and accept
wages paid to them, they at
the same time select what
part on their allotted tasks
they care to perform on their
own volition or refuse openly
or secretly
4. Sympathetic strike - Work stoppages
of workers of one company to make
common cause with other strikers or
other companies without demands or
grievances of their own against the Er
II/egal - There is no labor
dispute between the workers
136
who are joining the strikers
and the latter's Er
5. Secondary strike - Work stoppages
of workers of one company to exert
pressure on their Er so that the latter
will in turn bring pressure upon the Er
of another company with whom
another union has a labor dispute
I/Iegal - There is no labor
dispute involved.
N9te: A strike can validly take
place only in the presence of
and in relation to a labor.
dispute between Er and Ee.
6. Welga ng bayan (Cause Oriented
Strikes) - A political strike and
therefore there is neither a bargaining
deadlock nor any ULP
II/egal- It is a political rally
7. Quickie strikes- brief and
unannounced temporary work
stoppage
II/egal- failure to comply with
notice requirements and etc.
Q: Two unions, joined a welga ng bayan.
The unions, led by their officers, staged a
work stoppage which lasted for several
days, prompting FILFLEX and BIFLEX
Corporations to file a petition to declare the
work stoppage illegal for failure to comply
with procedural req'ts. Whether the Ees
committed an illegal work stoppage?
A: Yes. Ees, who have no labor dispute with
their Er but who, on a day they are scheduled
to work, refuse to work and instead join a
welga ng bayan commit an illegal work
stoppage. There being no showing that the two
unions notified the corporations of their
intention, or that they were allowed by the
corporations, to join the welga ng bayan, their
work stoppage is beyond legal
protection.(BIFLEX Phils. Inc. Labor Union
(NAFLU) vs. FILFLEX Industrial and
Manufacturing Corp., G.R. No. 155679, Dec.
Q: What are the grounds for the declaration
of strike?
A:
1. Deadlock in CSA (economic)
2. ULP (political)
Note: It is possible tochange an economic strike
into a ULP strike. (Consolidated Labor Ass'n of
the Phils. v. Marsman and Co., G.R. No. L-
17038, July 31, 1964)
'OJ
Violations of CBA must be gross to b'econsidered
as ULP.
Q: What is conversion doctrine?
A: It is when a strike starts as economic and
later, as it progresses, it becomes a ULP, or
vice versa.
Q: Can a strike be converted into a
lockout?
A: No, a strike cannot be converted into a pure
and simple lockout by the mere expedient of
filing before the trial court a notice of offer to
return to work during the pendency of the labor
dispute between the union and the employer.
(Rizal Cement Workers Union v. CIR, GR. No.
L-18442, Nov. 30, 1962).
Q: What are the tests in determining the
legality of strike?
A: The following must concur:
1. Purpose test - the strike must be due
to either bargaining deadlock and/or
the ULP
2. Compliance with the procedural and
substantive req'ts of the law. (See
requisites of a valid strike)
3. Means employed test - It states that
a strike may be legal at its inception
but eventually be declared illegal if
the strike is accompanied by violence
which is widespread, pervasive and
adopted as a matter of policy and not
mere violence which is sporadic
which normally occur in a.strike area.
Q: What are the instances when a strike or
lockout cannot be declared?
A: Non-strikable issues:
1. CSA violations not gross in character
2. Grounds involving inter/intra-union
disputes
3. When there is no notice of strike or
lockout or without the strike or lockout
vote
4. After assumption of jurisdiction by the
SLE
5. After certification or submission of
dispute to compulsory or voluntary
arbitration or during the pendency of
cases involving the same grounds for
strike or lockout
6. Labor standards cases such as wage
orders. (Guidelines governing Labor
Relations [Oct. 19, 19B7) issued by
Sec. Drilon. See also Art. 261, LC)
Q: Distinguish between an economic strike
and an ULP strike.
, Voluntary strike
because the Ee
will declare a
strike to compel
management to
grant its
demands
agent
the appropriate
bargaining unit
can declare an
economic strike
30 days from
notice of strike
before the
intended date of
actual strike
subject to the 7-
strike ban
Involuntary strike;
.forced to go on strike
because of the ULP
committed against them by
the Er. It is an act of self-
defense since the Ee's are
being pushed to the wall and
their only remedy is to stage
a strike
No exception -
mandatory
Note: notice of
strike and strike
vote may be
dispensed with;
they may strike
immediately
Either the CB agent or the
LLO in behalf of its members
15 days from the filing of the
notice of strike
, .<
The cooling-off period may
be dispensed with, and the
union may take immediate
action in case of dismissal
from employment of their
officers duly elected in
accordance with the union's
constitution and by-laws,
which may constitute union
busting where the existence
of the union is threatened. It
must still observe the
mandatory 7-day strike ban
period before it can stage a
valid strike
Pacu{ taa de (/)er ecno Ci vi C
137
Q: Who may declare a strike?
A:
1. Any certified or duly recognized
bargaining representative; in its
absence
2. Any LLO, on grounds of ULP only
Q: What are the procedural and substantive
requisites before a strike may be declared?
A:
1. Notice of strike - filed with the NCMB
taking into consideration the cooling-
off period
Note: The failure of the union to serve
the company a copy of the notice of
strike is a clear violation of Section 3,
Rule XXII, Book V of the Rules
Implementing the LC. The
Constitutional precepts of due process
mandate that the other party be notified
of the adverse action of the opposing
party. (Filipino Pipe and Foundry Corp.
v. NLRC, G.R. No. 115180, Nov.r 16,
1999)
2. 30115 day Cooling-off period before
the intended date of actual strike -
notice of strike is filed with the NCMB
taking into consideration the cooling-
off period, at least:
a. 30 days before the intended
strike for bargaining deadlocks;
b. 15 days before the intended
strike for ULP
3. Strike vote
a. The decision to declare a strike
must be approved by a majority
of the total union membership in
the bargaining unit concerned.
b. It must be obtained by secret
ballot through meetings or
referenda called for the purpose.
c. Its purpose is to ensure that the
intended strike is a majority
decision. The report on the strike
vote must be submitted to DOLE
at least 7 days before the
intended strike subject to the
cooling-off period.
d. The regional branch may
supervise the conduct of the
secret balloting at its own
initiative or upon request of any
party.
4. Furnish the regional branch of the
NCMB with a notice to conduct a
138
strike vote, at least 24-hours before
the meeting for such purpose (Sec.
10, Rule XXII of the Omnibus Rules
ofthe NLRC).
5. 7-Day strike ban - a 7-day waiting
period before the date of the
purported strike (within which the
union intending to conduct a strike
must at least submit a report to DOLE
as to the result ofthe strike vote)
Note: To give DOLE an opportunity to
verify whether the projected strike really
carries the imprimatur of the majority of
the union members in addition to the
cooling-off period before the actual
strike. (Lapanday Workers' Union, et.a!.
v. NLRC, G.R. Nos. 95494-97, Sep. 7,
1995)
Q: What is a cooling-off period?
A: It is the period of time given the NCMB to
mediate and conciliate the parties. It is the
span of time allotted by law for parties to settle
their disputes in a peaceful manner before
staging a strike or lockout.
Note: COOling-off and waiting period may be
done simultaneously.
Q: What is the effect of non-compliance
with the requisites of a strike?
A: The strike may be declared illegal.
Q: What is the purpose of giving notice of
the conduct of a strike vote to the NCMB at
least 24 hours before the meeting for the
said purpose?
A:
1. Inform the NCMB of the intent of the
union to conduct a strike vote;
2. Give the NCMS ample time to decide
on whether or not there is a need to
supervise the conduct of the strike
vote to prevent any acts of violence
and or irregularities;
3. Ample time to prepare for the
deployment of the requisite
personnel. (Capitol Medical Center v.
NLRC, G.R. No. 147080, April 26,
2005)
Q: Is a no strikellockout clause legal?
A: Yes, but it is applicable only to economic
strikes, not ULP strikes. As a provision in the
CSA, it is a valid stipulation although the
clause may be invoked by an employer (Er)
only when the strike is economic in nature or
one which is conducted to force wage or other
concessions from the Er that are not mandated
to be granted by the law itself. It would be
inapplicable to prevent a strike which is
grounded on ULP. (Panay Electric Co. v.
NLRC, G.R. No. 102672, Oct. 4, 1995;
Malayang Samahan ng mga Manggagawa sa
Greenfield v. Ramos, G.R. No. 113907, Feb.
28,2000)
Q: What is a preventive mediation case?
A: It involves labor disputes wlYch are the
subject of a formal or informal request for
conciliation and mediation assistance sought
by either or both parties or upon the initiative
of the NCMB. (Sec. 1 (mmj, Rule I, Book V,
IRR)
Note: The regional branch may treat the notice
as preventive mediation case upon agreement of
the parties.
Q: What are the contents of the notice of
strike or lockout?
A:
1. Name and addresses of Er
2. Union involved
3. Nature of the industry to which the Er
belongs
4. Number of union members
5. Workers in the bargaining unit
6. Other relevant date
7. In case of bargaining deadlocks:
unresolved issues, written proposals
of the union, counter-proposals of the
Er and proof of request for
conference to settle differences
8. In case of ULP: The acts complained
of, and the efforts taken to resolve the
dispute
Note: NCMB shall inform the concerned party in
case notice does not conform with the req'ts.
Q: What action will the board take on the
notice of strike of strike or lockout?
A:
1. Upon receipt of notice, the regional
branch of the Board shall exert all
efforts at mediation and conciliation to
enable the parties to settle the
dispute amicably. It shall also
encourage the parties to submit the
dispute to voluntary arbitration.
2. The regional branch of the NCMB
may, upon agreement of the parties,
treat a notice as a preventive
mediation case.
3. During the proceedings, the parties
shall not do any act which may
disrupt or impede the early settlement
of the dispute. They are obliged, as
part of their duty to bargain
collectively in good faith and to
participate fully and promptly in
conciliation meetings called by the
regional branch of the NCMB.
4. A notice, upon agreement of the
parties, may be referred to alternative
modes of dispute resolution, including
Q: Was the strike held by the union legal
based on the fact that the notice of strike
only contained general allegations of ULP?
A: No. Rule XIII Sec. 4 Book V of the
Implementing Rules of the LC provides: In
cases of ULP, the notice of strike shall as far
as practicable, state the acts complained of
and the efforts to resolve the dispute amicably.
(Tiu v. NLRC, G.R. No. 123276, Aug. 18,
1997)
Q: NFSW, the bargaining agent of Central
Azucarera de la Carlota (CAC) rank and file
employees, filed a notice of strike based on
non-payment of the 13
th
month pay and 6
days thereafter they held the strike. A day
after the commencement of the strike, a
report of the strike-vote was filed by NFSW
with MOLE. CAe filed a petition to declare
the strike illegal due to non-compliance
with the 15-day cooling of period and the
strike was held before the lapse of 7 days
from the submission to the MOLE of the
result of the strike vote. Was the strike held
by NFSW legal?
A: No. The cooling-off period in Art. 264(c)
and the 7-day strike ban after the strike-vote
report prescribed in Art. 264 (f) were meant to
be mandatory. The law provides that "the labor
union may strike" should the dispute "remain
unsettled until the lapse of the requisite
number of days from the filing of the notice",
this clearly implies that the union may not
strike before the lapse of the cooling-off
period. The cooling-off period is for the
Ministry of Labor and Employment to exert all
efforts at mediation and conciliation to effect a
voluntary settlement.
The mandatory character of the 7-day strike
ban is manifest in the provision that "in every
case" the union shall furnish the MOLE with
the results of the voting "at least 7 days before
the intended strike." This period is to give time
to verify that a strike vote was actually held.
(NFSW v. Ovejera, G.R. No. L-59743, May 31,
1982)
Pacu[ tad de cDer ecl i o Ci vi l
~.
.'." 139
Q: Fil Transit Ees Union filed a notice of
strike with the BLR becauseof allegedULP
of the company. Becauseof failure to reach
an agreement the union went on strike.
Several employees (Ees) were dismissed
because of the strike. The union filed
another notice of strike alleging ULP,
massive dismissal of officers and
members, coercion of Ees andviolation of
workers rights to self-organization. The
Ministry of Labor and Employment, after
assuming jurisdiction over the dispute,
ordered all striking Ees including those
whoweredismissed to return to work. The
companyhowevercounteredthat nostrike
vote had been obtained before the strike
was called andthe result of the strike vote
was not reported to Ministry of Labor and
Employment. Was the strike held by the
union illegal for failure to hold a strike
vote?
A: Yes, there is no evidence to show that a
strike vote had in fact been taken before a
strike was called. Even if there was a strike
vote held, the strike called by the union was
illegal because of non-observance by the
union of the mandatory 7-day strike ban
counted from the date the strike vote should
have been reported to the DOLE. (First Cfty
Interlink Transportation Co., Inc. v. Confessor,
GR. No. 106316, May 5, 1997)
Q: Thecompanyconceived anddecidedto
retrenchits Ees and selectedabout 40Ees
to be dismissed because of the lack of
work. Because of this about 200 Ees
during break-timeboardedbuses andwent
to the Ministry of Labor but they were
advisedto returntowork.
Uponreturning tothe company's premises,
the Ees were only allowed to stay in the
canteenand were not given work because
according to the company the machines
were undergoing repairs. Are the Ees
entitledto reinstatementandbackwages?
A: The Ees are entitled to reinstatement but
not to backwages. Both parties being in pari
delicto, having conducted an illegal strike and
lockout respectively, there must be a
restoration of the status quo ante and must
bring the parties back to their respective
positions prior to the illegal strike and lockout
which shall be done by reinstating the
remaining Ees. However, it is the general rule
that strikers are not entitled to backwages. The
principle of "no work, no pay" is applicable in
view of the finding of the illegality of the strike.
(Philippine Inter-Fashion, Inc v. NLRC, G.R.
No. L-59847, Oct. 18, 1982)
140
Q: What are the exceptions to the "no
backwagesrule" of strikers?
A:
1. When the Ees were illegally locked
thus compelling them to stage a strike
2. When the Er is guilty of the grossest
form of ULP
3. When the Er committed
discrimination in the rehiring of
strikers refusing to readmit those
against whom there were pending
criminal cases while admitting
nonstrikers who were also criminally
charged in court;
4. When the workers who staged a
voluntary ULP strike offered to return
to work unconditionally but the Er
refused to reinstate them. (Manila
Diamond Hotel VS. Manila Diamond
Hotel Ees' Union, G. R. No. 158075,
June 30, 2006, J. Carpio-Morales)
. A~T. 254.INJ UNCTION
Q: Whatis aninjunction?
A: It is an order or a writ that commands a
person to do or not to do a particular act. It
may be a positive (mandatory) or a negative
(prohibitory) command.
Q: May the court or quasi-judicial entity
issue any injunction during
strikes/lockouts?
A:
GR: No court or entity shall eruom any
picketing, strike or lockout, or any labor
dispute.
XPN:
1. When prohibited or unlawful acts are
being or about to be committed that
will cause grave or irreparable
damage to the complaining party.
(Art. 218[e])
2. On the ground of national interest
3. The SLE or the NLRC may seek the
assistance of law enforcement
agencies to ensure compliance with
this provision as well as with such
orders as he may issue to enforce the
same (Art. 263[g])
Q: What must an "innocent by-stander"
satisfy before a court may enjoin a labor
strike?
A: The innocent by stander must show:
1. Compliance with the grounds
specified in Rule 58 of the Rules of
Court,and
2. That it is entirely different from,
without any connection whatsoever
to, either party to the dispute and,
therefore, its interests ,?re totally
foreign to the context thereof. (MSF
Tire & Rubber v. CA, G.R. 128632,
Aug. 5, 1999)
Q: May the RTC take cognizance of the
complaint where the same is but an
incident of a labor dispute?
A: No, where the subject matter of the 3'd
party claim is but an incident of the labor case,
it is a matter beyond the jurisdiction of the
RTC, such courts have no jurisdiction to act on
labor cases or various incidents arising
therefrom, including the execution of
decisions, awards or orders.
A party, by filing its 3rd party claim with the
deputy sheriff, it submitted itself to the
jurisdiction of the NLRC acting through the LA.
The broad powers granted to the LA and to the
NLRC by Art. 217, 218 and 224 of the LC can
only be interpreted as vesting in them
jurisdiction over incidents arising from, in
connection with or relating to labor disputes,
as the controversy under consideration, to the
exclusion of the regular courts. The RTC,
being a co-equal body of the NLRC, has no
jurisdiction to issue any restraining order or
injunction to enjoin the execution of any
decision of the latter. (Delta ventures v.
Cabato, G.R. No. 118216, Mar. 9, 2000)
Q: The employer filed with the RTC a
complaint for damages with preliminary
mandatory injunction against the union, the
main purpose of which is to dispense the
picketing of the members of the union. The
union filed a motion to dismiss on the
ground of lack of jurisdiction. The RTC
denied the motion to dismiss and enjoined
the picketing, it said that mere allegations
of Er-Ee relationship does not
automatically deprive the court of its
jurisdiction and even the subsequent filing
of charges of ULP, as an afterthought, does
not deprive it of its jurisdiction. Was the
issuance by the RTC of the injunction
proper?
A: No, the concerted action taken by the
members of the union in picketing the
premises of the dep't store, no matter how
illegal, cannot be regarded as acts not arising
from a labor dispute over which the RTCs may
exercise jurisdiction. (Samahang Manggagawa
ng Liberty Commercial v. Pimentel, G.R. No.
L-78621, Dec. 2, 1987)
ART. 263(g)~ASSUMPTIOtf:OF
J 'URISDICTION; RETU~N-TO-WORK
ORDER
Q: Discuss the assumption of jurisdiction
by the Secretary of Labor and Employment
(SLE) on strikes/lockouts.
A:
1. Discretionary
a. If in his opinion there exists a
labor dispute causing or likely to
cause a strike or lockout in an
industry indispensable to the
national interest.
b. He may certify the same to the
NLRC for compulsory arbitration
c. Effect - Automatically enjoins the
intended or impending
strike/lockout but if one has
already taken place, all striking or
locked out Ees shall immediately
return to work and the Er shall
immediately resume operations
and re-admit all workers under the
same terms and conditions
prevailing before the strike or
lockout (Trans-Asia Shipping
Lines, Inc.-Unlicensed Crews Ee's
Union v. CA, G.R. No. 145428,
July 7, 2004)
Note: A motion for reconsideration does
not suspend the effects as the
assumption order is immediately
executory.
2. Mandatory (within 24 hours)
a. In labor disputes adversely
affecting the continued operation
of hospitals, clinics or medical
institutions.
b. May assume jurisdiction or certify
it to the NLRC for compulsory
arbitration
c. Duty of striking union or locking
out Er to provide and maintain an
effective skeletal workforce of
medical and other health
personnel, where movement and
service shall be unhampered and
unrestricted as are ~ecessary to
UNIVERSITY OF SANTO TOMAS ~i! 141
Pacu{taa de <Derecfw Ci vi C ' "
insure the proper and adequate
protection of the life and health of
its patients most especially
emergency cases for the duration
of the strike or lockout (Arl. 263
[gJ)
Q: What does the phrase "under the same
tenns and conditions" contemplate?
A:
GR: It contemplates only actual
reinstatement. This is in keeping with the
rationale that any work stoppage or
slowdown in that particular industry can be
inimical to the national economy.
XPN: Payroll reinstatement in lieu of actual
reinstatement but there must be showing of
special circumstances rendering actual
reinstatement impracticable, or otherwise
not conducive to attaining the purpose of
the law in providing for assumption of
jurisdiction by the SLE in a labor dispute
that affects the national interest. (Manila
Diamond Hotel Ees Union v. SLE, G.R. No.
140518, Dec. 16,2004)
Q: What are issues that the SLE may
resolve when he assumes jurisdiction over
a labor dispute?
A:
1. Issues submitted to the SLE for
resolution and such issues involved in
the labor dispute itself. (St.
Scho/astica's College v. Torres, G.R.
No. 100158, June 2, 1992)
2. SLE may subsume pending labor
cases before LAs which are involved
in the dispute and decide even issues
falling under the exclusive and
original jurisdiction of LAs such as the
declaration of legality or illegality of
strike (Int'I. Pharmaceuticals v. SLE,
G.R. Nos. 92981-83, Jan. 9, 1992)
Note: Power of SLE is plenary and discretionary.
(St. Luke's Medical Center v. Torres, G.R. No.
99395, June 29, 1993)
Q: What is the effect of defiance to the
return to work order?
A: It shall be considered an illegal act
committed in the course of the strike or lockout
and shall authorize the SLE or the NLRC, as
the case may be, to enforce the same under
pain or loss of employment status or
entitlement to full employment benefits from
the locking-out Er or backwages, damages
and/or other positive and/or affirmative reliefs,
142
even to criminal prosecution against the liable
parties. (Sec. 6, Rule IX, of the New Rules of
Procedure of the NLRC; St. Scholastica's
Col/ege v. Torres, G.R. No. 100158, June 2,
1992)
Q: Is it necessary for the SLE to issue a
return-to-work order in an assumption
order?
A: No, the mere issuance of an assumption
order automatically carries with it a return-to-
work order although not expressly' stated
therein. (TSEU-FFW v. CA, G.R. Nos. 143013-
14, Dec. 18, 2000)
Q: What is the extent of the powers of the
President during strikes/lockouts?
A:
1. May determine the industries, which
are in his opinion indispensable to
national interest
2. May intervene at any time and
assume jurisdiction over any such
labor dispute in order to settle or
terminate the same. (Arl. 263[gJ)
Note: The decision of the PresidenUSLE is final
and executory after receipt thereof by the parties.
Q: Maya return to work order be validly
issued pending determination of the
legality of the strike?
A: Yes. Where the return to work order is
issued pending the determination of the
legality of the strike, it is not correct to say that
it may be enforced only if the strike is legal and
may be disregarded if illegal. Precisely, the
purpose of the retum to work order is to
maintain the status quo while the
determination is being made. (Sarmiento v.
Tuico, G.R. Nos. 75271-73, June 27, 1988)
Q: What is the nature of the power of SLE
under Art. 263(g)?
A: The assumption of jurisdiction is in the
nature of a police power measure. This is done
for the promotion of the common good
considering that a prolonged strike or lockout
can be inimical to the national economy. The
SLE acts to maintain industrial peace. Thus,
his certification for compulsory arbitration is
not intended to impede the worker's right to
strike but to obtain a speedy settlement of the
dispute. (Philtread Workers Union v. Confesor,
G.R. No. 117169, Mar. 12, 1997)
Art. 263(g) does not interfere with the workers
right to strike but merely regulates it, when in
the exercise of such right national interest will
be affected. The LC vests upon the SLE the
discretion to determine what industries are
indispensable to national interest.
Q: A notice of strike was filed by the PSBA
Ees Union-FFW, alleging union busting,
coercion of Ees and harassment on the
part of PSBA. The conciliation being
ineffective, the strike pushed through. A
complaint for ULP and for a declaration of
illegality of the strike with a ~praye! for
preliminary injunction was filed by PSBA
against the union.
While the cases were pending, a complaint
was filed in the RTC of Manila by some
PSBA students against PSBA and the
union, seeking to enjoin the union and its
members from picketing and from
barricading themselves in front of the
schools main gate. A TRO was then issued
by the RTC, which the union opposed on
the ground that the case involves a labor
dispute over which the RTC had no
jurisdiction. The Acting SLE later on
assumed jurisdiction over the labor dispute
and ordered the striking Ee's to return to
work. Was the SLE correct in ordering the
striking Ees to return to work?
A: Yes. In the opinion of the Acting SLE, the
labor dispute adversely affected the national
interest, affecting as it did 9,000 students. He
is authorized by law to assume jurisdiction
over the labor dispute, after finding that it
adversely affected the national interest. This
power is expressly granted by Art. 263 (g) of
the LC, as amended by B.P. Big. 227.
Q: Does the RTC have jurisdiction to
decide on the case filed by the PSBA
students?
A: No, the RTC was without jurisdiction over
the subject matter of the case filed by some
PSBA students, involving as it does a labor
dispute over which the labor agencies had
exclusive jurisdiction. That the regular courts
have no jurisdiction over labor disputes and to
issue injunctions against strikes is well-settled.
(PSBA v. Nonet, G.R. No. 80648, Aug. 15,
1988)
Q: Members of the union learned that a
redundancy program would be
implemented by the company. Thereupon
it filed a Notice of strike on the grounds of
ULP. A number of conciliation meetings
were conducted but to no avail so the
union staged a strike while the company
terminated 383 union members from
service pursuant to its redundancy
program. Pursuant to Art. 263(g) of the LC
the SLE certified the labor dispute for
compulsory arbitration. Accordingly the
SLE enjoined the strike staged by the union
and all striking workers were directed to
return to work within 24 hours except for
those who were terminated due to
redundancy.
Was the SLE correct in excepting from the
return-to-work order those who were
terminated due to redundancy?
A: No, Art. 263(g) is clear and unequivocal in
stating that all striking or lock-out Ees shall
immediately return to work and the Er shall
immediately resume operations and readmit all
workers under the same terms and conditions
prevailing before the strike or lockout.
Records of the case would show that the strike
occurred one day before the members of the
union were dismissed due to alleged
redundancy. Thus the abovementioned article
directs that the Er must readmit all workers
under the same terms and conditions
prevailing before the strike. (PLOT v.
Manggagawa ng Komunikasyon sa Pilipinas,
G.R. No. 162783, July 14, 2005)
CONSEQUENCES OF STRIKE
Q: When is a strike illegal?
A:
1. Contrary to specific prohibition of law,
such as strike by employees (Ees)
performing governmental functions;
2. Violates a specific req't of law;
3. Declared for an unlawful purpose,
such as inducing the employer (Er) to
commit ULP against non-union Ees;
4. Employs unlawful means in the
pursuit of its objective, such as
widespread terrorism of non-strikers;
5. Declared in violation of an existing
injunction;
6. Contrary to an existing agreement,
such as a no strike clause or
conclusive arbitration clause
Q: When is an expression of an opinion by
the Er held to be culpable (totality of
conduct doctrine)?
A: The expressions of an opinion by an Er
which, though innocent in themselves, may be
held by the Court to be culpable based on the
ff:
1. The circumstances under which they
were uttered
UNIVERSITY OF SANTO TOM.AS ~~ 143
Pacu{ taa de ([ )er ecno CHli( '.
2. The history of the particular Ers labor
relations of anti-union bias
3. Their connection with an established
collateral plan of coercion or
interference
Q: What is the doctrine of means and
purposes?
A: It states that a strike is legal when lawful
means concur with lawful purpose. (GOP-CCP
Workers v. CIR, GR. No. L-33015, Sep. 10,
1979)
Q: What is the rule on reinstatement of
striking workers?
A: Striking employees are entitled to
reinstatement, regardless of whether or not the
strike was the consequence of the employers
ULP because while out on strike, the strikers
are not considered to have abandoned their
employment, but rather have only ceased from
their labor; the declaration of a strike is not a
renunciation of employment relation.
Q: Who are not entitled to reinstatement?
Q: What is "good faith (GF) strike" A:
doctrine?
A: A strike may be considered legal where the
union believed that the company committed
ULP and the circumstances warranted such
belief in GF, although subsequently such
allegations of ULP are found out as not true.
(Bacus V. Ople, GR No. L-56856, Oct. 23,
1984, People's Industrial and Commercial Ees
and Organization (FFW) V. People's Industrial
and Commercial Corp., G.R. No. 37687, Mar.
15, 1982)
Q: What is the effect of the GF of strikers
on the legality of strike?
A:
GR: A strike grounded on ULP is illegal if
no such acts actually exist.
XPN: Even if no ULP acts are committed
by the Er, if the Ees believe in GF that ULP
acts exist so as to constitute a valid ground
to strike, then the strike held pursuant to
such belief may be legal. Where the union
believed that the Er committed ULP and
the circumstances warranted such belief in
GF, the resulting strike may be considered
legal although, subsequently, such
allegations of ULP were found to be
groundless. (NUWHRAIN-Interim Junta V.
NLRC, G.R. No. 125561, Mar. 6, 1998)
Q: Should separation pay and backwages
be awarded to the participants of an illegal
strike?
A: No backwages will be awarded to union
members as a penalty for their participation in
the illegal strike. As for the union officers, for
knowingly participating in an illegal strike, the
law mandates that a union officer may be
terminated from employment and they are not
entitled to any relief. (Gold City Integrated Port
Services, Inc. V. NLRC, G.R. No. 86000, Sep.
21, 1990)
144
1. Union officers who knowingly
participate in the illegal strike
2. Any striker or union who knowingly
.participates in the commission of
illegal acts during the strike
Note: Those union members who have joined an
illegal strike but have not committed any illegal
act shall be reinstated but without back wages,
The responsibility for the illegal acts committed
during the strike must be on an individual and not
on a collective basis. (First City Interlink
Transportation Co., Inc, v. Confesor, G.R. No,
106316, May 5, 1997)
Q: Are strikers entitled to their backwages
or strike duration pay?
A:
GR: No, even if such strike was legal.
XPN:
1. Where the strikers voluntarily and
unconditionally offered to return to
work, but the employer refused to
accept the offer - workers are entitled
to back wages from the date their
offer was made
2, When there is a return-to-work order
and the Ees are discriminated against
other Ees, workers are entitled to
back wages from the date of
discrimination
3, In case of a ULP strike, in the
discretion of the authority deciding
the case
Q: What is the rule in strikes in hospitals?
A:
1. It shall be the duty of the striking
employees or locking-out employer to
provide and maintain an effective
skeletal workforce of medical and
health personnel for the duration of
the strike or lockout.
2. SLE may immediately assume
jurisdiction within 24 hours from
knowledge of the occurrence of such
strike or lockout certify it to the NLRC
for compulsory arbitration.
Q: More or less 1400Ees of the company
staged a mass walk-out, allegedlywithout
anybody leading them as it was a
simultaneous, immediate and unanimous
group action and decision, to protest the
non-paymentof their salariessand wages.
TheMinisterof LaborandEmploymentwho
found the strike to be illegal granted the
clearanceto terminate the employment of
those who were instigators in the Illegal
strike. Was the decision of the Minister of
Employment in granting the clearance
correct?
A: No, a mere finding of the illegality of a
strike should not be automatically followed by
wholesale dismissal of the strikers from their
employment. While it is true that administrative
agencies exerclsinq quasi-judicial functions
are free from the rigidities of procedure, it is
equally well-settled that avoidance of
technicalities of law or procedure in
ascertaining objectively the facts in each case
should not, however, cause denial of due
process. (Bacus v. Ople, G.R. No. L-56856,
Oct. 23, 1984)
Q: 2 days after the union struck, the SLE
ordered the striking workers to return to
work within 24 hours. But the striking
union failed to return to work and instead
they continued their pickets. As a result,
violence erupted in the picket lines. The
service bus ferrying non-striking workers
was stoned causing injuries to its
passengers. Threats, defamation, illegal
detention, and physical rnjunes also
occurred. The company was directed to
acceptbackall striking workers, exceptthe
union officers, shop stewards, and those
with pending criminal charges. Was the
SLE correct in not including the union
officers, shop stewards and those with
pending criminal charges in the return-to-
work order?
A: No, to exclude union officers, shop
stewards and those with pending criminal
charges in the directive to the company to
accept back the striking workers without first
determining whether they knowingly committed
illegal acts would be tantamount to dismissal
without due process of law. (Telefunken
Semiconductors Ees Union-FFW v. SLE, G.R.
No. 122743 & 127215, Dec. 12, 1997)
ART. 264.PROHIBITEDACTIVITIES .
Q: Whatarethe prohibited activities during
astrike/lockout?
A:
1. No labor organization or employer
(Er) shall dec/are a strike or lockout
without:
a. First having bargained
collectively in accordance with
Title VII of the LC or .
b. First having filed the notice
required in Art 263 or
c. The necessary strike or lockout
vote first having been obtained
and reported to DOLE
2. No strike or lockout shall be declared:
a. After assumption of jurisdiction
by the President or the DOLE
Secretary or
b. After certification or submlssion
of the dispute to compulsory or
voluntary arbitration or
c. During the pendency of cases
involving the same grounds for
strike/lockout.
3. No (third) person shall obstruct,
impede or interfere with by force,
violence, coercion, threats or
intimidation any peaceful picketing by
employees (Ees) during any labor
controversy or in the exercise of the
right of self-organization or CB or
shall aid or abet such obstruction or
interference.
4. No Er shall use or employ any strike
breaker nor shall any person be
employed as a strike breaker'
5.
GR: No public official or Ee, including
officers and personnel of the AFP,
PNP or armed persons shall bring in,
introduce, or escort in any manner,
any individual who seeks to replace
strikers in entering or leaving the
premises of a strike area or work in
place of the strikers. The police force
shall keep out of the picket lines
unless actual violence or other
criminal acts occur therein.
XPN: Nothing herein shall be
interpreted to prevent any public
officers from taking any measure
necessary to:
a. Maintain peace and order
b. Protect life and property
c. Enforce the law and legal order
UNIVERSITY OF SANTO TOMAS .~ 145
Pacu[ taa ae Ver ecno CiviC "
6. No person engaged in picketing shall:
a. Commit any act of violence,
coercion or intimidation, or
b. Obstruct the free ingress to or
egress from the Er's premises for
lawful purpose or obstruct public
thoroughfares
Q: The hotel union which was not certified
by the DOLE as the exclusive bargaining
agent staged a strike against the Hotel.
NLRC declared the strike illegal. CA
affirmed but ordered the reinstatement of
union members and officers. Are Union
members and officers who participated in
the illegal strike entitled to reinstatement?
A: It depends. The union officers should be
dismissed for staging and participating in the
illegal strike, ff. par. 3, Art. 264(a) of the LC
which provides that "any union officer who
knowingly participates in an illegal strike and
any worker or union officer who knowingly
participates in the commission of illegal acts
during strike may be declared to have lost his
employment status" An ordinary striking
worker cannot, thus be dismissed for mere
participation in an illegal strike. There must be
proof that he committed illegal acts during a
strike, unlike a union officer who may be
dismissed by mere knowingly participating in
an illegal strike and/or committing an illegal act
during a strike. (Manila Diamond Hotel vs.
Manila Diamond Hotel Ees Union, GR. No.
158075, June 30, 2006, J. Carpio-Morales)
ART.265. IMPROVED OFFER BALLOTING
Q: What is improved offer balloting?
A: A referendum conducted by DOLE on or
before the so" day of the strike, for the
purpose of determining whether or not the
improved offer of the employer is acceptable to
the union members.
Q: What is reduced offer balloting?
A: A referendum conducted by DOLE for the
purpose of determining whether or not the
reduced offer of the union is acceptable to the
board of directors, trustees or partners.
14,6
Q: Distinguish improved offer balloting
from reduced offer balloting.
To determine WON
the improved offer of
the Er is acceptable
to the union
members.
To ascertain the real
sentiment of the"
silent majority of the
union members on
strike.
To determine WON
reduced of the union is
acceptable to the Er.
To ascertain whether
at least a majority of
the Board of Directors
or trustees or partners
holding the controlling
interest vote to accept
the reduced offer
On or before the so"
day of strike
Applies only to
economic strikes
Majority of union
members vote to
accept improved
offer: striking workers
shall immediately
return to work and Er
shall readmit them
upon signing of the
agreement
On or before the so"
day of lockout
Applies only to
economic strikes -
deadlock in bargaining
Majority of
Directors, trustees or
partners vote to accept
the reduced offer:
workers shall
immediately return to
work and Er shall
readmit them upon
signing of the
ent
, ART. 266. REQUIREMENTS FOR ARREST ,
: AND DETENTION'
Q: Can police officers immediately arrest
and detain union members for union
activities?
A:
GR: A police officer CANNOT arrest or
detain a union member for union activities
without previous consultations with the
SLE.
XPN: Incidences pertaining to:
1, National security
2. Public peace
3. Commission of crimes
Q: In what cases can arrest be lawfully
made?
A:
1. Any person who obstructs the free
and lawful ingress and egress from
the Ers premises or who obstructs
public thoroughfares.
2. Any person who shall have in his
possession deadly weapons in
violation of B.P. Big. 6 and firearms
and explosives. (Guidelines for the
conduct of PNPIAFP Personnel in
Labor Disputes)
Academics Committee
Vi ce-Chai r for Academi cs: J eannie .\. Laurentino
Vi ce-Chai r for Admi n &F i nance: ,\issa CelineH.Luna
Labor Law Committee
S ubj ect H ead' Lester J ayAlanE.Flores II
Members:
ChristianNinoA.Diaz
AngeloS.Diokno
GenesisR.Fulgencio
J eanelle C.Lee
]emuel PaoloM.Lobo
Andrew W.Montesa
Maria Maica .\ngelika Roman
Pacu{taa ae i])erecfio Ci vi C
LABOR RELATIONS: POST-EMPLOYMENT
POST EMPLOYMENT
V\' ,ART. 278. COVERAGE, , '"',),:'-.
Q: Discuss the coverage of the Labor Code
as regards post-employment,
A: It applies to all establishments and
undertakings, whether operated for profit or
not, including educational, medical, charitable
and religious institutions and organizations in
cases of regular employment
Q: What employment is excluded from the
coverage of the Labor Code (LC)?
A: The coverage of the LC excludes
employment in the gov't and its political
subdivisions including GOCCs.
CLASSES OF EMPLOYEES
. ART. 280. REGULAR AND CASUAL
EMPLOYMENT
Q: What is regular employment?
A:
1. An employment shall be deemed to
be regular where the Ee has been
engaged to perform activities which
are usually necessary or desirable in
the usual business or trade of the Er,
the provisions of written agreements
to the contrary notwithstanding and
regardless of the oral agreements of
the parties. (Sec. 5 raj, Rule I, Book
VI,IRR)
2. Any Ee who has rendered at least
one year of service, whether such
service is continuous or broken, shall
be considered a regular Ee with
respect to the activity in which he is
employed and his employment shall
continue while such activity exists.
(Sec. 5 [bJ, Rule I, Book VI, IRR)
Notes: Regularization is not a management
prerogative; rather, it is the nature of employment
that determines it. It is a mandate of the law.
(PAL v. Pascua, G.R. No. 143258, Aug. 15,
2003)
Regular employment does not mean permanent
employment. A probationary Ee becomes a
regular Ee after 6 months. A regular Ee may only
be terminated for jusUauthorized causes.
148
The practice of entering into employment
contracts which would prevent the workers from
becoming regular should be struck down as
contrary to public policy and morals. (Universal
Robina Corp. v. Catapang, G.R. No. 164736, Oct.
14,2005)
Q: What is the test to determine regular
employment?
A:
1. The primary standard of determining
regular employment is the reasonable
connection between the particular
activity performed by the employee
(Ee) to the usual trade or business of
the employer. The test is whether the
former is usually necessary or
desirable in the usual business or
trade of the Er. (De Leon v. NLRC,
G,R. No. 7070~Aug. 21, 198~
Note: The connection can be
determined by considering the nature of
the work performed and its relation to
the scheme of the particular business or
trade in its entirety. (Highway Copra
Traders v, NLRC, G.R. No. 108889,
July 30, 1998)
2. Also, the performance of a job for at
least a year is sufficient evidence of
the job's necessity if not
indispensability to the business. This
is the rule even if its performance is
not continuous 'and merely
intermittent The employment is
considered regular, but only with
respect to such activity and while
such activity exists. (Universal Robina
Corp. v. Catapang, GR No. 164736,
Oct. 14, 2005).
Note: The status of regular employment attaches
to the casual Ee on the day immediately after the
end of his first year of service. The law does not
provide the qualification that the Ee must first be
issued a regular appointment or must first be
formally declared as such before he can acquire
a regular status. (Aurora Land Projects Corp, v.
NLRC, G.R No. 114733, Jan. 2, 1997)
Q: Is the mode of compensation
determinative of regular employment?
A: No, while the Ees mode of compensation
was on a "per piece basis" the status and
nature of their employment was that of regular
Ees. (Labor Congress of the Phils v. NLRC,
GR No. 123938, May 21, 1998)
Q: When does Art. 280 not apply?
Q: Coca-Cola Bottlers Phils, Inc., (CCBPI)
engaged the services of the workers as
"sales route helpers" for a period of 5
A: Yes. The jobs assigned to Dagui as months. After 5 months, the workers were
maintenance man, carpenter, plumber, employed by the company on fJ day-to-day
Ui..
UN iVE RSIT Y 0F SAN ToT 0MAS ~.! 149
fFacu(tad de cJ)erecfzo CiviC
A: Itdoes not apply incase of OFWs.
Note: Seafarerscannotbeconsideredas regular
Ees. Their employment is governed by the
contractsthey sign everytimethey are hiredand
their employmentterminatedwhen the contract
expires. Their employmentis fixed for a certain
periodof time. (Ravago v. Esso Eastern Maritime
Ltd., GR. No. 158324, Mar. 14, 2005)
Q: Moises was employed by La ron delia at
the maintenance section of its Eng'g Dep't
paid on a daily basis through petty cash
vouchers. His work consisted mainly of
painting company building and equipment
and other odd jobs relating to maintenance.
After a service of more than 1 year, Moises
requested that he be included in the payroll
of regular workers, instead of being paid
through petty cash vouchers. Instead La
Tondefia's dismissed Moises and claimed
that Moises was contracted on a casual
basis specifically to paint certain company
buildings and that its completion
tenninated Moises' employment. Can
Moises be considered as a regular Ee?
A: Yes, the law demands that the nature and
entirety of the activities performed by the Ee
be considered. Here, the painting and
maintenance work given Moises manifests a
treatment consistent with a maintenance man
and notjust a painter, for if his job was only to
paint a building there would be no basis for
giving himother work assignments in-between
painting activities.
It is not tenable to argue that the painting and
maintenance work of Moises are not
necessary in La Tonderia's business of
manufacturing liquors; otherwise, there would
be no need for the regular maintenance
section of the company's eng'g dep't. (De
Leon v. NLRC, G.R. No. 70705, Aug. 21,
1989)
Q: Honorio Dagui was hired by Dona
Aurora Suntay Tanjangco in 1953 to take
charge of the maintenance and repair of the
Tanjangco apartments and residential
bldgs. He was to perform carpentry,
plumbing, electrical and masonry work.
Upon the death of Dona Aurora Tanjangco
in '82 her daughter, Teresita Tanjangco
Quazon, took over the administration of all
the Tanjangco properties, and dismissed
Dagui. Is Honorio Dagui a regular employee
(Ee)?
electrician and mason were directly related to
the business of the Tanjangco's as lessors of
residential and apartment bldgs. Moreover,
such a continuing needfor his services by the
Tanjangcos is sufficient evidence of the
necessity and indispensability of his services
totheir business or trade.
Dagui should likewise be considered a regular
Ee by the mere fact that he rendered service
for the Tanjangcos for more than one year,
that is, beginning '53 until '82, under Dona
Aurora; and then from 1982 up to J une 8, '91
under the daughter, for a total of 29 and 9
years respectively. Owing to Dagui's lengthof
service, he became a regular Ee, by operation
of law, one year after he was employed in '53
and subsequently in '82. (Aurora Land
Projects Corp. v. NLRC, G.R. No. 114733,
Jan. 2, 1997)
Q: A total of 43 Ees who are deaf-mutes
were hired and re-hired on various periods
by Far East Bank and Trust Co. as money
sorters and counters through a uniformly
worded agreement called "Employment
Contract for Handicapped Workers." The
company disclaimed that these Ees were
regular Ees and maintained among others
that they are a special class of workers,
who were hired temporarily under a special
employment arrangement which was a
result of overtures made by some civiC and
political personalities to the Bank. Should
the deaf-mute Ees be constdered as regular
Ees?
A: Yes. The renewal of the contracts of the
handicapped workers and the hiring of others
leads to the conclusion that their tasks were
beneficial and necessary to the bank. It also
shows that they were qualified to performthe
responsibilities of their positions; their disability
did not render themunqualified or unfit for the
tasks assignedtothem.
The Magna Carta for Disabled Persons
mandates that a qualified disabled Ee should
be given the same terms and conditions of
employment as a qualified able-bodiedperson.
The fact that the Ees were qualified disabled
persons necessarily removes the employment
contracts fromthe ambit of Art. 80. Since the
Magna Carta accords them the rights of
qualified able-bodied persons, they are thus
covered by Art. 280 of the Le. (Bernardo v.
NLRC, G.R. No. 122917, July 12, 1999)
basis. According to the company, the
workers were hired to substitute for regular
route helpers whenever the latter would be
unavailable or when there would be an
unexpected shortage of manpower in any
of its work places or an unusually high
volume of work. The practice was for the
workers to wait every morning outside the
gates of the sales office of the company, if
thus hired, the workers would then be paid
their wages at the end of the day. Should
the workers be considered as regular
employees (Ees) of CCBPI?
A: Yes, the repeated rehiring of the workers
and the continuing need for their services
clearly attest to the necessity or desirability of
their services in the regular conduct of the
business or trade of the company. The fact
that the workers have agreed to be employed
on such basis and to forego the protection
given to them on their security of tenure,
demonstrate nothing more than the serious
problem of impoverishment of so many of our
people and the resulting unevenness between
labor and capital. (Magsalin & Coca-Cola v.
N. O. w.M., G.R. No. 148492, May 9, 2003)
Q: Metromedia Times Corp. entered, for the
fifth time, into an agreement with Efren
Paguio, appointing him to be an account
executive of the firm. He was to solicit
advertisements for "The Manila TImes,".
The written contract between the parties
provided that, "You are not an Ee of the
Metromedia Times Corp. nor does the
company have any obligations towards
anyone you may employ, nor any
responsibility for your operating expenses
or for any liability you may incur. The only
rights and obligations between us are
those set forth in this agreement. This
agreement cannot be amended or modified
in any way except with the duly authorized
consent in writing of both parties." Is Efren
Paguio a regular employee of Metromedia
Times Corporation?
A: Yes, he performed activities which were
necessary and desirable to the business of the
Er, and that the same went on for more than a
year. He was an account executive in
soliciting advertisements, clearly necessary
and desirable, for the survival and continued
operation of the business of the corp.
The corporation cannot seek refuge under the
terms of the agreement it has entered into with
Efren Paguio. The law, in defining their
contractual relationship, does so, not
necessarily or exclusively upon the terms of
their written or oral contract, but also on the
150
basis of the nature of the work of Efren has
been called upon to perform. A stipulation in
an agreement can be ignored as and when it is
utilized to deprive the Ee of his security of
tenure. (Paguio v. NLRC, G.R. No. 147816,
May 9,2003)
Q: What are the requisites before a private
school teacher can attain permanent
status?
A:
1. The teacher is a full-time teacher;
2. The teacher must have rendered
three consecutive years of service;
and
3. Such service must have been
satisfactory. (St. Mary's University v.
CA, G.R. No. 157788, Mar. 8, 2005)
Q: Who are full-time academic personnel?
A: Those who:
1. Possess at least the minimum
academic qualifications prescribed by
the Department of Education under
this Manual for all academic
personnel;
2. Are paid monthly or hourly, based on
the regular teaching loads as
provided for in the policies, rules and
standards of the Department of
Education and the school;
3. Whose total working day of not more
than 8 hours a day is devoted to the
school;
4. Have no other remunerative
occupation elsewhere requiring
regular hours of work that will conflict
with the working hours in the school;
and
5. Are not teaching full-time in any other
educational institution. (Sec. 45 of the
1992 Manual of Regulations for
Private Schools)
Note: All teaching personnel who do not meet the
foregoing qualifications are considered part-time.
Q: Oonelo taught at the St. Mary's
University on a contractual basis.
Sometime later, he was issued an
appointment as Asst. Professor I, and later
Asst. Prof. III. He taught until the first
semester of S.Y. '99-'00 when the school
did not give him any teaching aSSignments.
Oonelo thus filed a complaint for illegal
dismissal. 5t. Mary's however claim that
Oonelo was never a regular Ee of the
school, as he was only a part-time
instructor, carrying a load of less than 18
units. It was also claimed that the twin-
notice req't does not apply in the case of
part-time teachers. Is Oonelo a full-time
teacher and has he attained permanent
status?
A: No, a part-time Ee does not attain
permanent status no matter how long he has
served the school. After the end of each term
or semester, the school does not have any
obligation to give teaching load to each and
every part-time teacher. Since there is no
showing that Donelo worked on full-,me basts
for at least 3 years, he could not have acquired
a permanent status. (St. Mary's University v.
CA, G.R. No. 157788, Mar. 8, 2005)
[ PROJ ECT EMPLOYEES
Q: What is project employment?
A: Employment that has been fixed for a
specific project or undertaking the completion
for which has been determined at the time of
engagement of the employee (Ee). (Sec. 5 [aJ,
Rule I, Book VI, IRR). The period is not the
determining factor, so that even ifthe period is
more than 1 year, the Ee does not necessarily
become regular.
Notes: Where the employment of a project Ee is
extended long after the supposed project has
been finished, the Ees are removed from the
scope of project Ees and considered as regular
Ees. .
Repeated hiring on a project-to-project basis is
considered necessary and desirable to the
business of the Er. The Ee is regular (Maraguinot
v. NLRC, G.R. No. 120969, Jan. 22, 1998 ).
However, repeated hiring does not necessarily
mean regular employment. (Filipinas Pre-
Fabricated Building Systems (FILSYSTEMS), Inc.
v. Puente, GR. No. 153832,.March 18, 2005)
Q: What are the requisites in detennining
whether an employee (Ee) is a project Ee?
A:
1. The project Ee was assigned to carry
out a specific project or undertaking,
and
2. The duration and scope of which
were specified at the time the Ee was
engaged for that project. (Imbuido v.
NLRC, G.R. No. 114734, Mar. 31,
2000)
3. The Ee must have been dismissed
every after completion of his project
or phase
4. Report to the DOLE of Ee's dismissal
on account of completion of contract
(Policy Inst. No. 20; D.O. 19[1997])
Q: What is a project?
A: A "project" has reference to a particular job
or undertaking that mayor may not be within
the regular or usual business of the Er. In
either case, the project must be distinct,
separate and identifiable from the main
business of the Er, and its duration must be
determined or determinable (PAL v. NLRC,
G.R. No. 125792, Nov. 9, 1998).
Q: Can a project employee (Ee) or a
member of a work pool acquire the status
of a regular Ee?
A: Yes, when the following concur:
1. There is a continuous rehiring of
project Ee's even after cessation of a
project; and
2. The tasks performed by the alleged
"project Ee" are vital, necessary and
indispensable to the usual business
or trade of the employer (Er).
Note: The length of time during which the Ee was
continuously re-hired is not controlling, but merely
serves as a badge of regular employment. Enero
and Maraguinot have been employed for a period
of not less than 2 years and have been involved
in at least 18 projects. These facts are the basis
in coosiderlnq them as regular Ees of the
company. (Maraguinot v. NLRC, G.R. No.
120969,Jan.2Z 1998)
Members of a work pool from which a
construction company draws its project Ees, if
considered Ees of the construction company
while in the work pool, are non-project Ees or Ees
for an indefinite period. If they are employed in a
particular project, the completion of the project or
any phase thereof will not mean severance of Er-
Ee relationship. Unless the workers in the work
pool are free to leave any time and offer their
services to other Ers. (L. T. Datu & Co., Inc. v.
NLRC, GR. No. 113162, Feb. 9, 1996)
Q: What is the "day certain" rule?
A: It states that a project employment that
ends on a certain date does not end on an
exact date but upon the completion of the
project.
Q: Are project Ees entitled to separation
pay?
A:
GR: Project Ees are not entitled to
separation pay if they are terminated as a
result of the completion project.
XPN: If the projects they are working on
have not yet been completed, when their
Pacu(taa ae Der ech o Ci vi C
.~ 151
services are terminated; project Ees also
enjoy security of tenure during the limited
time of their employment. (De Ocampo v.
NLRC, G.R. No. 81077, June 6, 1990)
Q: Roger Puente was hired by Filsystems,
Inc., initially as an installer and eventually
promoted to mobile crane operator, and
was stationed at the company's premises.
Puente claimed in his complaint for illegal
dismissal, that his work was continuous
and without interruption for 10 years, and
that he was dismissed from his
employment without any cause. Filsystems
on its part averred that Puente was a
project Ee in the company's various
projects, and that after the completion of
each project, his employment was
terminated, and such was reported to the
DOLE. Is Roger Puente a regular Ee?
A: No, Puente is a project Ee. The contracts
of employment of Puente attest to the fact that
he was hired for specific projects. His
employment was coterminous with the
completion of the projects for which he had
been hired. Those contracts expressly
provided that his tenure of employment
depended on the duration of any phase of ~he
project or on the completion of the construction
projects. Furthermore, the company regularly
submitted to the labor dep't reports of the
termination of services of project workers.
Such compliance with the reportorial req't
confirms that Puente was a project Ee.
The mere rehiring of Puente on a project-to-
project basis did not confer upon him regular
employment status. "The practice was
dictated by the practical consideration that
experienced construction workers are more
preferred." It did not change ~is status .a~a
project Ee. (Filipinas Pre-Fabrtcated Bulldmg
Systems (FILSYSTEMS), Inc. v. Puente, G.R.
No. 153832, Mar. 18, 2005)
, TERM EMPLOYEES
Q: What is a fixed-term employment?
A: It is an employment where a fixed period of
employment was agreed upon:
1. Knowingly and voluntarily by the
parties,
2. Without any force, duress or improper
pressure being brought to bear upon
the employee (Ee) and
3. Absent any other circumstances
vitiating his consent, or
4. Where it satisfactorily appears that
the Er and Ee dealt with each other
152
on more or less equal terms with no
moral dominance whatever being
exercised by the former over the
latter. (Brent School, Inc. v. Zamora,
G.R. No. 48494, Feb. 5, 1990)
Note: A fixed-period Ee does not become a
regular Ee because his employment is co-
terminus with a specific period of time.
Ee hired on a fixed-term is regular if job is
necessary and desirable to the business of Er.
(Philips Semiconductor v. Fadriquela, G.R. No.
141717, April 2004)
Q: Is "term employment" a circumvention
of the law on security of tenure?
A: No, it is not a circumvention of the law if it
follows the requisites laid down by the Brent
ruling: (Romares v, NLRC, G.R. No. 122327,
Aug. 19, 1998)
Q: Dean J ose and other employees are
holding administrative positions as dean,
dep't heads and institute secretaries. In the
implementation of the Reorganization,
Retrenchment and Restructuring program
effective J an. 1, 1984, Dean J ose and other
employees were retired but subsequently
rehired. Their appointrnent to their
administrative positions as dean, dep't
heads and institute secretaries had been
extended by the company from time to time
until the expiration of their last
appointment on May 31, 1988. Were Dean
J ose and other employees illegally
dismissed?
A: No. Petitioners were dismissed by reason
of the expiration of their contracts of
employment. Petitioners' appointments .as
dean, dep't heads and institute secretaries
were for fixed terms of definite periods as
shown by their respective contracts of
employment, which all expired on the same
date, May 31, 1988. The validity of
employment for a fixed period has been
acknowledged and affirmed by the. SC.
(Blancaflor v. NLRC, G.R. No. 101013, Feb. 2,
1993)
Q: How is the project worker different from
a casual or contractual worker? Briefly
explain your answers.
A: A " contractual worker" is a generic term
used to designate any worker covered by a
written contract to perform a specific
undertaking for a fixed period. On the other
hand, a " project worker" is used to designate
workers in the construction industry, hired to
perform a specific undertaking for a fixed
period, co-terminus with a project or phase
thereof determined at the time of the
engagement of the Ee. (Policy Instruction No.
19, DOLE) In addition, to be considered a
true project worker, it is required that a
termination report be submitted to the nearest
public employment office upon the
completion of the construction project.
(Aurora Land Projects Corp. v. NLRC, G.R.
No. 114733, Jan. 2, 1997) In contrast, there is
no such requirement for an ordinary
contractual worker. (2005 Bar Question)
Q: What is seasonal employment?
A: Employment where the job, work or service
to be performed is seasonal in nature and the
employment is for the duration of the season.
(Sec.5 (aJ, Rule I, Book VI, IRR)
An employment arrangement where an
employee (Ee) is engaged to work during a
particular season on an activity that is usually
necessary or desirable in the usual business
or trade of the employer (Er).
Note: For seasonal Ees, their employment legally
ends upon completion of the project or the
season. The termination of their employment
cannot and should not constitute an illegal
dismissal. (Mercado v. NLRC, G.R. No. 79869,
Sept. 5, 1991)
One year duration on the job is pertinent in
deciding whether a casual Ee has become
regular or not, but it is not pertinent to a seasonal
or project Ee. Passage of time does not make a
seasonal worker regular or permanent. (Mercado
v. NLRC, G.R. No. 78969, Sep. 5, 1991)
During off-season, the relationship of Er-Ee is not
severed; the seasonal Ee is merely considered
on LOA without pay. Seasonal workers who are
repeatedly engaged from season to season
performing the same tasks are deemed to have
acquired regular employment. (Hacienda Fatima
v. National Federation of Sugarcane Workers-
Food and General Trade, G. R. No. 149440, Jan.
28,2003)
Q: Are seasonal Ees entitled to separation
pay?
A: When the business establishment is sold
which effectively terminates the employment of
the seasonal Ees, the latter would be entitled
to separation pay.
Q: Can seasonal employees (Ees) be
considered as regular Ees?
A: Yes. The fact that seasonal Ees do not
work continuously for one whoie year but only
for the duration of the season does not detract
from considering them in regular employment.
Seasonal workers who are cailed to work from
time to time and are temporarily laid off during
off-season are not separated from service in
that period, but merely considered on leave
until re-employed.
If the Ee has been performing the job for at
least a year, even if the performance is not
continuous and merely intermittent, the law
deems repeated and continuing need for its
performance as sufficient evidence of the
necessity if not indispensability of that activity
to the business. Hence, the employment is
considered regular, but only with respect to
such activity and while such activity exists.
(Ben ares v. Pancho, G.R. No. 151827, April
29,2005)
Q: Carli to Codilan and Maximo Docena had
been working for the rice mill for 25 years,
while Eugenio Go, Teotilo Trangria and
Reynaldo Tutin have been working for 22,
15, and 6 years respectively. The
operations of the rice mill continue to
operate and do business throughout the
year even if there are only two or three
harvest seasons within the year. This
seasonal harvesting is the reason why the
company considers the workers as
seasonal Ees. Is the company correct in
conslderlnq the Ees as seasonal Ees?
A: No, the fact is that big rice mills such as
the one owned by the company continue to
operate and do business throughout the year
even if there are only two or three harvest
seasons within the year. It is a common
practice among farmers and rice dealers to
store their palay and to have the same milled
as the need arises. Thus, the milling
operations are not seasonal. Finally,
considering the number of years that they
have worked, the lowest being 6 years, the
workers have long attained the status of
regular Ees as defined under Art. 280.
(Tacloban Sagkahan Rice Mill v. NLRC, G.R.
No. 73806, Mar. 21, 1990)
Pacu(taa ae i Der ecl i o CiviC
.~ 153
~ PROBATIONARY EMPLOYEES
Q: What is probationary employment?
A: Employment where the employee (Ee),
upon his engagement:
1. Is made to undergo a trial period
2. During which the Er determines his
fitness to qualify for regular
employment,
3. Based on reasonable standards
made known to the Ee at the time of
engagement. (Sec 6, Rule I, Book VI,
IRR)
Note: The services of an Ee who has been
engaged on probationary basis may be
terminated only for just cause, when he fails to
qualify as a regular Ee in accordance with
reasonable standards prescribed by the Er.
Q: Michelle Miclat was employed on a
probationary basis as marketing assistant
by Clarion Printing House but during her
employment she was not informed of the
standards that would qualify her as a
regular employee (Ee). 30 days after,
Clarion informed Miclat that her
employment contract hac'!been terminated
without any reason. Miclat was informed
that her termination was part of Clarion's
cost-cutting measures. Is Miclat considered
as a regular Ee and hence entitled to its
benefits?
A: Yes. Probationary employment shall be
governed by the following rules: xxx (d) In all
cases of probationary employment, the Er
shall make known to the Ee the standards
under which he will qualify as a regular Ee at
the time of his engagement. Where no
standards are made known to the Ee at that
time, he shall be deemed a regular Ee". In the
case at bar, she was deemed to have been
hired from day one as a regular Ee. (Clarion
Printing House Inc., VS. NRLC, G.R. No.
148372, June 27, 2005, J . Carpio-Morales)
Q: What are the characteristics of
probationary employment?
A:
1. It is an employment for a trial period;
2. It is a temporary employment status
prior to regular employment;
3. It arises through a contract with the
following elements:
a. The employee (Ee) must learn
and work at a particular type of
work
b. Such work calls for certain
qualifications
154
c. The probation is fixed
d. The Er reserves the power to
terminate during or at the end of
the trial period
e. And if the Ee has learned the job
to the satisfaction of the Er, he
becomes a regular Ee.
Q: What is the period of probationary
employment?
A: GR: It shall not exceed 6 months.
XPNs:
1. Covered by an apprenticeship or
learnership agreement stipulating a
different period
2. Voluntary agreement of parties
(especially when the nature of work
requires a longer period)
3. The Er gives the(Ee a second chance
to pass the standards set. (Mariwasa
Manufacturing, Inc. v. Leogardo,
Jr.,G.R. No. 74246, Jan. 26, 1989)
4. When the same is required by the
nature of the work, e.g. the
probationary period set for
professors, instructors and teachers
is 3 consecutive years of satisfactory
service pursuant to DOLE Manual of
Regulations for Private Schools.
5. When the same is established by
company policy.
Note: Period of probation shall be reckoned from
the date the Ee actually started working. (Sec.6
[b), Rule I, Book VI, IRR)
After the lapse of the probationary period (6
months), Ee becomes regular.
Probationary Ees may be dismissed before end
of the probationary period.
Q: May the Er and Ee validly agree to
extend the probationary period beyond 6
months?
A: Yes. Such an extension may be lawfully
agreed upon, despite the restrictive language
of Art. 281. A voluntary agreement extending
the original probationary period to give the Ee
a second chance to pass the probation
standards constitutes a lawful exception to the
statutory limit. (Mariwasa Manufacturing, Inc.
v. Leogardo, Jr., G.R. No. 74246, Jan. 26,
1989)
Note: By voluntarily agreeing to such an
extension, the Ee waived any benefit attaching to
the completion of the period if he still failed to
make the grade during the period of extension.
(Mariwasa Mfg. Inc. v. Hon. Leogardo, G.R. No.
74246, Jan. 26, 1989)
Q: Is double or successive probation
allowed?
A: No. The evil sought to be prevented is to
discourage scheming employers from using
the system of double or successive probation
to circumvent the mandate of the law on
regularization and make it easier for them to
dismiss their employees. (Holiday Inn Manila
v. NLRC, G.R. No. 109114, Sep. 14,2003)
Q: Middleby Phils. Corp. hire~ Alcica as
eng'g support services supervisor on a
probationary basis for 6 months.
Apparently unhappy with Alcira's
performance, Middleby terminated his
services. Alcira contends that he was
already a regular employee (Ee) when he
was tenninated. According to Alcira's
computation, since Art. 13 of the Civil Code
provides that 1 month is composed of 30
days, 6 months totaling 180 days, then his
180
th
day would fall on Nov. 16, '96 making
him a regular Ee before his termination. Is
the contention of the petitioner in the
computation of 6 months correct?
A: No, the computation of the 6-month
probationary period is reckoned from the date
of appointment up to the same calendar date
of the s" month following. In short, since the
number of days in each particular month was
irrelevant, Alcira was still a probationary Ee
when Middleby opted not to "regularize" him
on Nov. 20, 1996. (Alcira v. NLRC, G.R. No.
149859, June 9, 2004)
Note: In Mitsubishi Motors v. Chrysler Phils.
Labor Union, GR. No. 148738, June 29, 2004,
the SC ruled inthis wise:
"Applying Art. 13 of the Civil Code, the
probationary period of 6-months consists of the
180 days. This is in conformity with par.1, Art. 13
of the Civil Code. The number of months in the
probationary period, 6, should then be multiplied
by the number of days within a month, 30; hence,
the period of 180 days. As clearly provided for
the in last par. of Art. 13, in computing a period,
the first day shall be excluded and the last day
included. Thus, the 180 days commenced on
May 27,1996, and ended on Nov. 23,1996. The
termination letter dated Nov. 25, 1996 was
served on Paras only on Nov. 26, 1996. He was,
by then already a regular Ee of the company
under Art. 281 of the LC."
How to resolve the conflict between the Alcira
and Mitsubishi Motors case?
1. Statutory Construction - The latter case
prevails (Mitsubishi Motors); or
2. Rule more favorable to the Ee - use the
computation which would amount to
granting the subject Ee regular
employment status (based on
Constitutional and statutory provisions
for the liberal interpretation of labor
laws)
Q: What is the purpose of the period?
A; To afford the employer an opportunity to
observe the fitness of a probationary employee
at work.
Q: In what instances is a probationary
employee (Ee) deemed a regular Ee?
A:
1. If he is allowed to work after a
probationary period. (Art. 281)
2. If no standards, under which he will
qualify as a regular Ee, are made
known to him at the time of his
engagement. (Sec. 6[d), Rule I, Book
VI, IRR)
Q: What are the grounds for terminating
probationary employment?
A:
1. J usUauthorized causes
2. When he fails to qualify as a regular
Ee in. accordance with reasonable
standards made known by the
employer (Er) to the Ee at the time of
his engagement (ICMC v. NLRC,
G.R. No. 7222~Jan. 30, 198~
Notes: The probationary Ee is entitled to
procedural due process prior to dismissal from
service.
While probationary Ees do not enjoy permanent
status, they are afforded the security of tenure
protection of the Constitution. Consequently, they
cannot be removed from their positions unless for
cause. Such constitutional protection, however,
ends upon the expiration of the period stated in
their probationary contract of employment.
Thereafter, the parties are free to renew the
contract or not. (CSA v. NLRC, GR. No. 87333,
Sep. 6, 1991)
Q; What are the limitations on the
employer's (Er's) power to tenninate a
probationary employment contract?
A:
1. The power must be exercised in
accordance with the specific req'ts of
the contract
2. If a particular time is prescribed, the
termination must be within such time
and if formal notice is required, then
that form must be used,
Pacu{ taa de cDer ecno Cid{ .. .
3. The Er's dissatisfaction must be real
and in good faith, not feigned so as to
circumvent the contract or the law
4. There must be no unlawful
discrimination in the dismissal
Note: The probationary employee is entitled to
procedural due process prior to dismissal from
service.
Q: R.L. Cruz was employed as gardener by
Manila Hotel on "probation status" effective
Sep. 22, '76. The appointment signed by Cruz
provided for a 6 month probationary period.
On Mar. 20, '77, or a day before the expiration
of the probationary period, Cruz's was
promoted to lead gardener position. On the
same day Cruz' position was "abolished" by
Manila Hotel allegedly due to economic
reverses or business recession, and to
salvage the enterprise from imminent danger
of collapse. Was Cruz illegally dismissed?
A: Yes, there is no dispute that as a probationary
employee (Ee), Cruz had but limited tenure.
Although on probationary basis, however, Cruz
still enjoys the constitutional protection on
security of tenure. During his tenure of
employment, therefore, or before his contract
expires, Cruz cannot be removed except for
cause as provided for by law.
What makes Cruz' dismissal highly suspicious is
that it took place at a time when he needs only
but a day to be eligible as a regular Ee. That he
is competent finds support in his being promoted
to a lead gardener in so short span of less than 6
months. By terminating his employment or
abolishing his position with but only one day
remaining in his probationary appointment, the
hotel deprived Cruz of qualifying as a regular Ee
with its concomitant rights and privileges. (Manila
Hotel Corp. v. NLRC, G.R. No. L-53453, Jan. 22,
1986)
Q: Coleglo San Agustin (CSA) hired the Gela
J ose as a grade school classroom teacher on
a probationary basis for SY 'S4 - 'S5. Her
contract was renewed for SY's 'S5'S6 and 'S6-
'S7. On Mar. 24, 'S7, the CSA wrote the Gela
that "it would be in the best interest of the
students and their families that she seek
employment in another school or business
concern for next school year".
Notwithstanding the said notice, the CSA still
paid Gela her salary for April 15 to May 15,
1987. On April 6, 'S7, Gela wrote the eSA and
sought reconsideration but she received no
reply. Thereafter, she filed a complaint for
illegal dismissal. Was Gela illegally
dismissed?
A: No. The Faculty Manual of CSA underscores
the completion of 3 years of continuous service at
CSA before a probationary teacher acquires
156
tenure. Hence, the Gela cannot claim any vested
nght to a permanent appointment since she had
not yet achieved the prerequisite 3-year period
under the Manual of Regulation for Private
Schools and the Faculty Manual of CSA.
Inthe instant case where the CSA did not wish to
renew the contract of employment for the next
school year, the Gela has no ground to protest.
She was not illegally dismissed. Her contract
merely expired. (CSA v. NLRC, G.R No. 87333,
Sep. 6, 1991)
Q: During their probationary employment, S
Ees were berated and insulted by their
supervisor. In protest, they walked out. The
supervisor shouted at them to go home and
never to report back to work. Later, the
personnel manager required them to explain
why ,they should not be dismissed from
employment for abandonment and failure to
~ualify for the positions applied for. They
flled a complaint for illegal dismissal against
their Er. As a LA, how will you resolve the
case?
A: As a LA I will resolve the case in favor of the
8 probationary Ees due to the ff::
1. Probationary Ees also enjoy security of
tenure. (Biboso v. Victoria Milling,
G.R. No. L-44360, Mar. 31, 1977)
In all cases involving Ees on
probationary status, the Er shall make
known to the Ee at the time he is
hired, the standards by which he will
qualify for the positions applied for.
The filing of the complaint for illegal
dismissal effectively negates the Ers
theory of abandonment. (Rizada v.
NLRC, G.R. No. 96982, Sep. 21,
1999)
The order to go home and not to return
to work constitutes dismissal from
employment.
The 8 probationary Ees were
terminated without just cause and
without due process
2.
3.
4.
5.
In view of the foregoing, I will order
reinstatement to their former positions without
loss of seniority rights with full backwages, plus
damages and atty's fees. (2006 Bar Question)
~" ' . CASUAL EMPLOYEES
Q: What is casual employment?
A:
1. An Ee is engaged to perform a job,
work or service which is merely
incidental to the business of the Er,
and such job, work or service is for a
definite period made known to the Ee
at the time of engagement (Sec. 5 {b},
Rule I, Book VI, IRR) ~) ~
Note: If he has rendered at least 1 year of
service, whether such service is continuous
or broken, he is considered as regular Ee
with respect to the activity in which he is
employed and his employment shall
continue while such activity exists.
A Casual Ee is only casual for 1 year, and it
is the passage of time that gives him a
regular status. (KASAMMA-CCO v. CA, G.R.
No. 159828, April 19, 2006)
The purpose is to give meaning to the
constitutional guarantee of security of tenure
and right to self-organization. (Mercado v.
NLRC, G.R. No. 79868, Sep. 5, 1991)
2. It is an employment where the Ee is
engaged in an activity which is not
usually necessary or desirable in the
usual business or trade of the Er,
provided: such employment is not
project nor seasonal (Art. 281).
Note: But despite the distinction between
regular and casual employment, every Ee
shall be entitled to the same rights and
privileges, and shall be subject to the same
duties as may be granted by law to regular
Ees during the period of their actual
employment.
Q: Yakult Phils. is engaged in the
manufacture of cultured milk. The workers
were hired to cut cogon grass and weeds at
the back of the factory building used by
Yakult. They were not required to work on
fixed schedule and they worked on any day
of the week on their own discretion and
convenience. The services of the workers
were terminated by Yakult on less than 1-
year after. May casual or temporary Ees be
dismissed by the Er before the expiration
of the 1-year period of employment?
A: Yes, the usual business or trade of private
respondents is the manufacture of cultured
milk. The cutting of the cogon grasses in the
premises of its factory is hardly necessary or
desirable in the usual business of the Yakult.
The workers are casual Ees. Nevertheless,
they may be considered regular Ees if they
have rendered services for at least 1 year.
When, as in this case, they were dismissed
from their employment before the expiration of
the 1-year period they cannot lawfully claim
that their dismissal was illegal. (Capule, et al.
v. NLRC, G.R. No. 90653, Nov. 12, 1990)
Academics Committee
Chai r per son: .AbrahamD.Genuino II
Vi ce-Chai r j or Academi cs: J eannie A.Laurentino
Vi ce-Chai r j ar Admi n &F i nance: Aissa CelineH.Luna
Vi ce-Cbai r j ar L yout &Desi gn: LoiseRae G.Naval
Labor LawCommittee
SubJect H ead' Lester J ayAlanE.FloresII
Assi stant SubJect H ead' Domingo B.Diviva V
Members:
Rene FrancisP.Batal1a
Maria Kristina 1. Dacayo-Garcia
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanel1eC.Lee
J emuel PaoloM.Lobo
Andrew \'\1. Montesa
UNIVERSITY OF SANTO TOMAS ~\.!157
Pacu{taa ae lDerecfio Ci1Jif '1
LABOR RELATIONS: TERMINATION OF EMPLOYMENT: J UST CAUSES
r " ART. 279. SECURITY OF TENURE.' '.
Q: What is security of tenure?
A: In cases of regular employment, the Er
shall not terminate the services of an Ee
except for just or authorized causes as
provided by law, and subject to the req'ts of
due process. (Sec. 2 (aJ, Rule I, Book VI, IRR)
It is the constitutional right granted to Ee, that
an Er shall not terminate the services of an Ee
except for just cause or when authorized by
law. It extends to regular (permanent) as well
as non-regular (temporary) employment.
(Kiamco v. NLRC, G.R. No. 129449, June 29,
1999)
Note: Security of tenure is not confined to cases
of termination of Er-Ee relationship alone. It is
also intended to shield workers from unwarranted
and unconsented demotion and transfer.
Q: What is the extent of the application of
security of tenure?
A: It does not exclusively apply to regular
employment only. It also applies to
probationary, seasonal, project and other
forms of employment during the effectivity
thereof. Managerial employees also enjoy
security of tenure.
Q: Which takes precedence in conflicts
arlsmg between Ers' management
prerogatives and the Ees' right to security
of tenure?
A: The Ees' right to security of tenure. An Ers'
management prerogative includes the right to
terminate the services of the Ee but this
management prerogative is limited by the LC
which provides that the Er can terminate an Ee
only for just cause or when authorized by law.
This limitation is because no less than the
Constitution recognizes and guarantees Ees'
right to security of tenure. (Art. 279, LC, Art.
XIII, Sec. 3, 1987 Constffution)
l ART. 282: TERMINATION BY EMPLOYER .
Q: What are the just causes for
termination?
A:
1. Serious misconduct or willful
disobedience by the employee (Ee) of
the lawful orders of his employer (Er)
or representative in connection with
his work
15f.f
2. Gross and habitual neglect by the Ee
of his duties
3. Fraud or willful breach by the Ee of
the trust reposed in him by his Er or
duly organized representative
4. Commission of a crime or Qffense by
the Ee against the person of his Er or
any immediate member of his family
or his duly authorized representative.
5. Other causes analogous to the
foreqoinq
Note: The burden of proving that the termination
was for a valid or authorized cause shall rest on
the Er. (Art. 277{bJ)
Q: What is the totality of infractions
doctrine?
A: It is the totality. not the
compartmentalization of company infractions
that the Ee has committed, which justifies the
penalty of dismissal. (MERALCO v. NLRC,
G.R. No. 114129, Oct. 24, 1996)
Where the Ee has been found to have
repeatedly incurred several suspensions or
warnings on account of violations of company
rules and regulations, the law warrants their
dismissal as it is akin to "habitual delinquency".
(Villeno v. NLRC, G.R. No. 108153, Dec. 26,
1995)
Q: What are the guidelines to determine the
validity of termination?
A:
1. Gravity of the offense
2. Position occupied by the employee
3. Degree of damage to the employer
4. Previous infractions of the same
offense
5. Length of Service
. I. SERIOUS MISCONDUCT
Q: What is serious misconduct?
A: It is an improper or wrong conduct; the
transgression of some established and definite
rule of action, a forbidden act, a dereliction of
duty. willful in character, and implies wrongful
intent and not mere error in judgment. To be
serious within the meaning and intendment of
the law, the misconduct must be of such grave
and aggravated character and not merely
trivial or unimportant. (Vil/amor Golf Club v.
Pehid, G.R. No. 166152, Oct. 4, 2005)
Q: What are the elements of serious
misconduct?
A:
1. It must be serious or of such a grave
and aggravated character;
2. Must relate to the performance of the
employees (Ee) duties;
3. Ee has become unfit to continue
working for the employer. (Philippine
Aeolus Automotive United Corp. v.
NLRC, G.R. No. 1246~l , Aprjl 28,
2000)'
Q: Escando, upset at his transfer to the
washer section, repeatedly uttered "gago
ka" and threatened bodily hann to his
superior Mr. Andres, Is the utterance of the
obscene words and threats of bodily harm
gross and willful misconduct?
A: Yes. The repeated utterances by Escando
of obscene, insulting or offensive words
against a superior were not only destructive of
the morals of his co-employees (Ees) and a
violation of the company rules and regulations,
but also constitute gross misconduct which is
one of the grounds provided by law to
terminate the services of an Ee. (Autobus
Workers Union v. NLRC, G.R. No. 11753,
June 26, 1998)
Q: Samson made Insulting and obscene
utterances towards the General Manager
saying "Si EDT bullshit yan, sabihin mo kay
EDT yan" among others during the
Christmas party, Are the utterances
towards the General Manager gross
misconduct?
A: The alleged misconduct of Samson when
viewed in its context is not of such serious and
grave character as to warrant his dismissal.
The Samson made the utterances and
obscene gestures at an informal Christmas
gathering and its is to be expected during this
kind of gatherings, where tongues are more
often than not loosened by liquor of other
alcoholic beverages, that employees (Ees)
freely express their grievances and gripes
against their employers (Ers). Ees should be
allowed wider latitude to feely express heir
grievances and gripes against their Er. Ees
should be allowed wider latitude to freely
express their sentiments during these kinds of
occasions which are beyond the disciplinary
authority of the Er. (Samson v. NLRC, G.R.
No. 121035, April 12, 2000)
Q: Give some examples of serious
misconduct.
A:
1. Sexual harassment
2. Fighting within the company premises
3. Uttering obscene, insulting or
offensive words against a superior
4. Falsification of time records
5. Gross immorality
II. WILLFUL DISOBEDIENCE o.
Q: When is willful disobedience of the Er's
lawful orders a just cause for termination?
A: 2 requisites must concur:
1. The employees (Ees) assailed
conduct must have been willful or
intentional, the willfulness being
characterized by a wrongful and
perverse attitude.
2. The disobeyed orders, regulations or
instructions of the Er must be:
a. Reasonable and lawful
b. Sufficiently made known to the
Ee
c. Must pertain to or be in
connection with the duties which
the Ee has been engaged to
discharge. (Cosep V. NLRC,
G.R. No. 124966 June 16, 1998)
Note: There is no law that compels an Ee to
accept a promotion for the reason that a
promotion is in the nature of a gift or reward.
which a person has the right to refuse. The
exercise of the Ee of the right to refuse a
promotion cannot be considered in law as
insubordination or willful disobedience. (PT& T
Corp. v. CA. GR. No. 152057, Sep. 29, 2003)
Q: Aquote brought out of the company
premises the company vehicle without
authorization twice and meeting an
accident in Espana Blvd. in the latter
instance. Is Aquote guilty of willful
disobedience even though he was not the
one who personally brought the company
vehicle out of the company premises?
A: Yes. A rule prohibiting Ees from using
company vehicles for private purpose without
authority from management is a reasonable
one.
When Aquote rode the company vehicle he
was undoubtedly aware of the possible
consequences of his act and taking into
consideration his moral ascendancy over the
security guards it was incumbent upon him not
UNIVERSITY OF SANTO TOMAS (:~ 159
If'acu[taa ae lDereChO Ci vi C ' ."
only to admonish them but also to refrain from
using the company car himself. (Family
Planning Org. of the Phil. v. NLRC, G.R. No.
75907, Mar. 23, 1992)
Q: Escobin et al. were security guards
based in Basilan were placed in floating
status and were asked to report for
reassignment in Metro Manila by PIS! and
upon failure to report or respond to such
directives were ordered dismissed from
employment by PISI for willful
disobedience. Did the failure to report to
Manila amount to willful disobedience?
A: The reasonableness of the rule pertains to
. the kind of character of directives and
commands and to the manner in which they
are made. In this case, the order to report to
the Manila office fails to meet this standard.
The order to report to Manila was
inconvenient, unreasonable, and prejudicial to
Escobin et a/. since they are heads of families
residing in Basilan and they were not given
transportation money or assurance of
availability of work in Manila. (Escobin v.
NLRC, G.R. No. 118159. Apri/15, 1998)
III. A. NEGLIGENCE
Q: When is negligence a just cause for
termination?
A: When it is gross and habitual.
Gross negligence implies a want or absence of
or failure to exercise slight care of diligence of
the entire absence of care it evinces
thoughtless disregard of consequences
without exerting any effort to avoid them.
However, such neglect must not only be gross
but habitual in character. (Judy Phils. v. NLRC,
G.R. No. 111934, April 29, 1998)
Habitual Neglect implies repeated failure to
perform one's duties over a period of time,
depending upon the circumstance. (JGB and
Associates v. NLRC, GR No. 10939, Mar. 7,
1996)
Q: Antiola, as assorter of baby infant dress
as for J udy Phils. erroneously assorted and
packaged 2,680 dozens of infant wear.
Antiola was dismissed from employment
for this infraction. Does the single act of
misassortment constitute gross
negligence?
A: No. Such neglect must not only be gross
but also habitual in character. Hence, the
penalty of dismissal is quite severe
160
considering that Antiola committed the
infraction for the first time. (Judy Phi/so V.
NLRC, G.R. No. 111934. April 29, 1998)
Q: Does the failure in performance
evaluations amount to gross and habitual
neglect of duties?
A: As a general concept "poor performance" is
equivalent to inefficiency and incompetence in
the performance of official duties. The fact that
an employee's (Ee's) performance is found to
be poor or unsatisfactory does not necessarily
mean that the Ee <is grossly and habitually
negligent of his duties. Gross negligence
implies a want or absence of or failure to .
exercise slight care of diligence or the entire
absence or care. He evinces a thoughtless
disregard of consequences without exerting
any effort to avoid them. (Eastern Overseas
Employment Center Inc. V. Bea, G.R. 143023,
Nov.29,2005)
Q: Is inefficiency a just cause for
dismissal?
A: Yes, 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. (Buiser
V. Leogardo, GR. No. L-63316, July 31, 1984)
This ground is considered analogous to those
enumerated under Art. 282. (Skippers United
Pacific v. Magud, G.R. No. 166363, Aug. 15,
2006)
Q: Gamido was a quality control inspector
of VH Manufacturing. Gamido was allegedly
caught by the company Pres. Dy J uanco of
sleeping and was dismissed from
employment Did Gamido's act of sleeping
on the job constitute a valid cause of
dismissal?
A: Sleeping on the job as a valid ground for
dismissal only applies to security guards
whose duty necessitates that they be awake
and watchful at all times. Gambido's single act
of sleeping further shows that the alleged
negligence or neglect of duty was neither
groS$ nor habitual. (VH Manufacturing V.
NLRC, G.R. No. 130957, Jan. 19,2000)
Q: Give some forms of neglect of duty.
A:
1. Habitual tardiness and absenteeism
2. Abandonment:
a. Failure to report for work or
absence without justifiable
reason
b. Clear intention to sever Er-Ee
relationship manifested by some
overt acts. (Labor et. al v. NLRC,
GR No. 110388, Seg.14, 1~95)
I III.. B. ABANDONMENT
Q: What is abandonment as a just cause for
termination?
A: It means the deliberate, unjustified refusal
of an employee to resume his employment.
Q: What are the requirements for a valid
finding of abandonment?
A: For a valid finding of abandonment, 2
factors must be present:
1. The failure to report for work, or
absence without valid 'Or justifiable
reason; and
2. A clear intention to sever Er-Ee
relationship, with the 2nd element as
the more determinative factor, being
manifested by some overt acts. (Sta.
Catalina College and Oranza, vs.
NLRC and Tercera, G. R. No.
144483, Nov. 19, 2003, J. Carpio-
Morales)
Q: How to prove abandonment?
A: To prove abandonment, the Er must show
that the Ee deliberately and unjustifiably
refused to resume his employment without any
intention of returning. There must be a
concurrence of the intention to abandon and
some overt acts from which an Ee may be
deduced as having no more intention to work.
The law, however, does not enumerate what
specific overt acts can be considered as strong
evidence of the intention to sever the Ee-Er
relationship. (Sta. Catalina College and Sr.
Loreta Oranza, VS. NLRC and Tercera, G.R.
No. 144483. Nov. 19, 2003, J. Carpio-
Morales)
Q: Mejila a barber at Windfield Barber
Shop, had an altercation with a fellow
barber which resulted in his subsequent
turning over the duplicate keys of the shop
to the cashier and took away all his
belongings there from and worked at
different barbershop. Mejila then filed an
illegal dismissal case but did not seek
reinstatement as a relief. Did Mejila commit
abandonment?
A: Mejila's acts such as surrendering the
shop's keys, not reporting to the shop anymore
without any justifiable reason, his employment
in another barber shop, and the filing of a
complaint for illegal dismissal without praying
for reinstatement clearly show that there was a
concurrence of the intention to abandon and
some overt acts from which it may be inferred
that the Ee concerned has no more interest in
working. (Jo v. NLRC, G.R. No. 121605, Feb.
2,2000)
IV. FRAUD; BREACH OF TRUSTILOSS OF
CONFIDENCE .
Q: When is breach of trust/loss of
confidence a just cause for termination?
A:
1. It applies only to cases involving:
a. Employees (Ees) occupying
positions of trust and confidence
(confidential and managerial
Ee's) - to this class belong
managerial Ees, i.e., those
vested with the powers or
prerogatives to lay down
management policies andlor to
hire, transfer, suspend, lay-off,
recall, discharge, assign or
discipline Ees or effectively
recommend such managerial
actions
b. Ees routinely charged with the
care and custody of the
employer's (Er's) money Dr
property - to this class belong
cashiers, auditors, property
custodians, etc., or those who, in
the normal and routine exercise
of their functions, regularly
handle significant amounts of
money or property. (Mabeza v.
NLRC, G. R. No. 118506 April 18,
1997)
2. The loss of trust and confidence must
be based on willful breach. A breach
is willful if it is done intentionally,
knowingly, and purposely without
justifiable excuse, as distinguished
from an act done carelessly,
thoughtlessly, heedlessly, or
inadvertently (De te Cruz v. NLRC,
G.R. No. 119536, Feb. 1~199~.
3. The act constituting the breach must
be "work-related" suchas would show
UNIVERSITY OF SANTO TOMAS (~. 161
Pacu[ taa de (] )er ecno Ci vi C ," ,
the Ee concerned to be unfit to
continue working for the Er.
(Gonzales V. NLRC, G.R. No.
131653, Mar. 26, 2001)
4. It must be substantial and founded on
clearly established facts sufficient to
warrant the Ee's separation from
employment. (Sulpicio Lines Inc. V.
Guide, G. R. No. 149930, Feb. 22,
2002)
5. Fraud must be committed against the
Er or his representatives, e.g.:
a. Falsification of time cards
b. Theft of company property
c. Unauthorized use of company
vehicle
Note: The treatment of rank and file personnel
and managerial Ees in so far as the application of
the doctrine of loss of trust and confidence is
concerned is different. As regards managerial
Ees, such as Caoile, mere existence of a basis
for believing that such Ee has breached the trust
of his Er would suffice for his dismissal. (Caoile v.
NLRC, GR. No. 115491, Nov. 24, 1998)
A criminal case need not be actually filed.
Commission of acts constituting a crime itself is
sufficient.
Q: What are the guidelines for the doctrine
of loss of confidence to apply?
A:
1. Loss' of confidence should not be
simulated (reasonable basis for loss
of trust and confidence)
2. Not used for subterfuge for causes
which are improper and/or illegal and
unjustified .
3. Not arbitrarily asserted in the face of
overwhelming evidence to the
contrary;
4. Must be genuine, not a mere
afterthought to justify earlier action
taken in bad faith and
5. The Ee involved holds a position of
trust and confidence.
Q: Mabeza a chambermaid at Hotel
Supreme was terminated from employment
because of her refusal to sign an affidavit
attesting to their employer's (Er's)
compliance with minimum wage and other
labor standards. Mabeza filed a complaint
for illegal dismissal against Hotel Supreme.
As a defense, Hotel Supreme claimed that
she abandoned her work and belatedly
claimed loss of confidence as the ground
for the dismissal of Mabeza because she
stole some of the properties of her Er. Is
1.62
loss of confidence a valid ground for
dismissal of a hotel chambermaid?
A: No. Loss of confidence as a just cause for
dismissal was never intended to provide Ers
with a blank check for terminating their Ees.
Evidently, an ordinary chambermaid who has
to sign out for linen and other hotel property
from the property custodian each day and who
has to account for each and every towel or bed
sheet utilized by the hotel's guests at the end
of her shift would not fall under any of these
two classes of Ees for which loss of
confidence, if ably supported by evidence,
would nonmally apply. (Mabeza v. NLRC, G.R.
No. 118506, April 18, 1997)
Note: The breach of trust must rest on
substantial grounds and not on the Er's
arbitrariness, whims, caprices, or suspicion:
otherwise, the Ee would eternally remain at the
mercy of the Er. It should be genuine and not
simulated, nor should it appear as a mere
afterthought to justify earlier action taken in bad
faith of a subterfuge for causes which are
improper, illegal, or unjustified. It has never been
intended to afford and occasion for abuse
because of its subjective nature. There must,
therefore, be an actual breach of dully committed
by the employee which must be established by
substantial evidence. (Oela Cruz v. NLRC, GR.
No. 119536, Feb. 17, 1997)
Q: Abelardo Abel was first hired by Philex
Mining Corp. in J an. '88. He was later
assigned to the company's Legal Dep't as a
Contract Claims Asst., and held the
position for 5 yrs prior to his transfer to the
Mine Eng'g and Draw Control Dep't wherein
he was appointed Unit Head. In '02, he was
implicated in an irregularity occurring in
the subsidence area of the company's mine
site at Benguet. His co-worker Danilo,
executed an affidavit known as the
"Subsidence Area Anomaly". The incidents
in Lupega's affidavit supposedly took place
when Abel was still a Contract Claims Asst.
at the company's legal dep't. An
investigation was promptly launched by the
company's officers. Abel attended the
meetings but claimed that he was neither
asked if he needed the assistance of
counsel nor allowed to properly present his
side. By memo, the company found Abel
guilty of (1) fraud resulting in loss of trust
and confidence and (2) gross neglect of
duty, and was meted out the penalty of
dismissal from employment. Was Abel
validly dismissed for any of the causes
provided for in Art. 282 of the LC?
A: No. The 1st requisite for dismissal on the
ground of loss of trust and confidence is that
A: Although union security clauses embodied
in the CBA may be validly, enforced and
UNIVERSITY OF SANTO TOMAS f~~ 163
Pacu[ taa de (] )er ecfzo Ci vi l ' .'
the Ee concerned must be holding a position
of trust and confidence, Abel was a contract
claims assistant at the time he allegedly
committed the acts which led to its loss of trust
and confidence. It is not the job title but the
actual work that the Ee performs. It was part of
Abel's responsibilities to monitor the
performance of the company's contractors in
relation to the scope of work contracted out to
them.
The 2nd requisite is that there most be 61nact
that would justify the loss of trust' and
confidence. Loss of trust and confidence, to
be a valid cause for dismissal, must be based
on a willful breach of trust and founded on
clearly established facts. The basis for the
dismissal must be clearly and convincingly
established but proof beyond reasonable
doubt is not necessary. The company's
evidence against Abel fails to meet this
standard. Its lone witness, Lupega, did not
support his affidavit and testimony during the
company investigation with any piece of
evidence at all. It could hardly be considered
substantial evidence. (Abel v. F?hilex Mining
Corp., G.R. No. 178976, July 31, 2009, J .
Carpio-Morales)
: V. COMMISSION OF A CRIME
Q: What do you mean by "commission of a
crime or offense" as a just cause for
termination of an Ee? .
A: It refers to an offense by the Ee against the
person of his employer or any immediate
member of his family or his duly authorized
representative and thus, conviction of a crime
involving moral turpitude is not analogous
thereto as the element of relation to his work
or to his employer is lacking.
Note: A criminal case need not be actually filed.
Commission of acts constituting a crime itself is
sufficient.
. VI. ANALOGOUS CASES
Q: What is required for an act to be
included in analogous cases of just causes
of termination?
A: Must be due to the voluntary and/or willful
act or omission of the employee (Nadura v.
Benguet Consolidated, G.R. No. L-17780,
Aug. 24, 1962), e.g.: .
1. Violation of company rules and
2.
3.
regulations
Drunkenness
Gross inefficiency
4." Illegally diverting employer's products
5. Failure to heed an order not to join an
illegal picket
6. Violation of safety rules and code of
discipline
Q: What is the doctrine of incompatibility?
A: Where the employee has done something
that is contrary or incompatible with the faithful
performance of his duties, his employer has a
just cause for terminating his employment.
(Manila Chauffeur's League v. Bachrach Motor
Co., G.R. No. L-47071, June 17, 1940)
VII. IMMORALITY
Q: Santos, a married man and a teacher
was dismissed from employment for
having an extra-marital affair with a co-
teacher as confirmed by the investigating
committee of the school. Is immorality a
just and valid ground for dismissal of
employment?
A: To constitute immorality, the circumstances
of each particular case must be holistically
considered and evaluated in light of the
prevailing norms of conduct and applicable
laws. Consequently, it is but stating the
obvious to assert that teachers must adhere to
the exacting standards of morality and
decency. The personal behaviors of teacher, in
and outside of the classroom must be beyond
reproach. Teachers must observe a high
standard of integrity and honesty. When a
teacher engages in extra-marital relationship.
especially when the parties are both married,
such behavior amounts to immorality, justifying
his termination from employment. (Santos v.
NLRC, G.R. No. 115795, Mar. 6, 1998)
VIII. UNION SECURITY CLAUSE
Q:, MSMG was a local union affiliated with
ULGWP a national federation. MSMG had a
dispute with ULGWP over an imposition of
a fine prompting MSMG to declare
independence from ULGWP. Because of
the dispute, ULGWP asked for the
dismissal from employment of the officers
of MDMG from the company by virtue of a
union security clause iii the CBA. The
company dismissed the officers. Does a
union security clause absolve the company
form observing the requirement of due
process?
dismissals pursuant thereto may likewise be
valid, this does not erase the fundamental
requirement of due process. An employer
cannot merely rely upon a labor federation's
allegations in terminating union officers
expelled by the federation for allegedly
committing acts of disloyalty and/or inimical to
the interest of the federation and in violation of
its constitution and by laws.
The right of an Ee to be informed of the
charges against him and to be given a
reasonable opportunity to present his side in a
controversy with 'either the company or his
own union is not wiped away by a union
security clause in a CBA. Even assuming that
a federation had valid grounds to expel union
, officers, due process requires that these union
officers be accorded a separate hearing by the
company. (MSMG v. Ramos, G.R. No,
113907, Feb. 28, 2000)
_ IX.MARRIAGE
Q: Is a company policy prohibiting
marriagebetweenco-workers valid?
A: There must be a finding of a bona fide
occupational qualification (BFOQ) to justify an
employer's (Er's) no spouse rule, There must
be a compelling business necessity for which
no alternative exists other than the
discriminating practice. (Star Paper v, Simbol,
G.R. No. 164774, April 12, 2006)
Q: What are the factors that the Er must
proveinordertojustify BFOQ?
A: The Er must prove 2 factors:
3. That the employment qualification is
reasonably related to the essential
operation of the job involved; and
4. 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, April 12,
2006)
Q: Tecson was employed by Glaxo as
medical representative who has a policy
against employees having relationships
against competitor's employees (Ees).
Tecson married Bettsy, a Branch
coordinator of Astra, Glaxo's competitor.
Tecson was transferred to another area.
Tecsondid not acceptsuch transfer. Is the
policy of Glaxovalid and reasonableso as
164
to constitute the act of Tecson as willful
disobedience?
A: The prohibition against personal or marital
relationships with Ees of competitors
companies upon Glaxo's Ees is reasonable
under the circumstances because
relationships of that nature might compromise
the interest of the company. Glaxo does not
impose an absolute prohibition against
relationships between its employees and those
of competitor companies. Its employees are
free to cultivate relationships with and marry
persons of their own choosing. What the
company merely seeks to avoid is a conflict of
interest between the Ee and the company that .
may arise out of such relationships.
Furthermore, the prohibition forms part of the
employment contract and Tecson was aware
of such restrictions when he entered into a
relationship with Bettsy. (Duncan Asso. Of
Detailman-PTGWO v Glaxo WeI/come Phil.
lnc., G.R. No. 162994, Sep. 17, 2004)
.'. ~:"';". "
""~'~' ....""--,, .
Academics Committee
Chai r per son: Abraham D. Genuine II
Vi ce-Chai r for L qyout &Desi gn: Loise Rae G.Naval
Labor LawCommittee
Subj ect H ead: Lester J ayAlanE.FloresII
Members:
Diane Camilla R Borja
ChristianNinoA.Diaz
AngeloS, Diokno
Genesis R.Fulgencio
J eanelle C.Lee
J emuel PaoloM.Lobo
Andrew W, Montesa
:' . PROCEDURE IN TERMINATION --- -
Q: What are the 2-fold requirements of a
valid dismissal for a just cause?
A:
1. Substantive - it must be for a just
cause
2. Procedural - there must be notice
and hearing
Q: What is the process to be ~serv~d by
the employer (Er) for termination of the
employment based on any of the just
causes for termination?
A:
1. A written notice should be served to
the Ee specifying the ground/s for
termination and giving the said Ee
reasonable opportunity to explain.
Note: This first written notice must
apprise the Ee that his termination is
being considered due to the acts stated
in the notice. (Phil. Pizza Inc. v.
Bungabong, GR. No. 15"4315, May 9,
2005)
2. A hearing or conference should be
held during which the Ee concerned,
with the assistance of counsel, if the
Ee so desires, is given the
opportunity to respond to the charge,
present his evidence and present the
evidence presented against him.
3. A written notice of termination - If
termination is the decision of the Er, it
should be served on the Ee indicating
that upon due considerations of all
the Circumstance, grounds have been
established to justify his termination,
at least one month prior to his
termination.
Note: Single notice of termination does
not comply with the requirements of the
law. (Aldeguer & Co., Inc.lLoalde
Boutique, VS. Honeyline Tomboc, GR.
No. 147633, July 28, 2008, J. Carpio-
Morales)
Q: What is the purpose of notice and
hearing?
A:
1. The req't of notice is intended to
inform the Ee concerned of the Er's
intent to dismiss him and the reason
for the proposed dismissal; on the
other hand,
2. The req't of hearing affords the Ee
the opportunity to answer his Er's
charges against him and accordingly
to defend himself there from before
dismissal is effected. (Salaw v. NLRC
G.R. No. 90786 Sep. 27, 1991)
Note: Failure to comply with the req't of
the 2 notices makes the dismissal
illegal. The procedure is mandatory.
(Loadstar Shipping Co. Inc. v. Mesano,
G.R. No. 138956, Aug. 7, 2003)
Q: While it may be true that the Er enjoys
wider latitude of discretion in terminating
employees (Ees) should there exists valid
and just cause, would this be sufficient for
the Er to depart from giving the Ee the right
to be heard?
A: Art. 277(b) of the LC mandates that an Er
who seeks to dismiss an Ee must "afford the
latter ample opportunity to be heard and to
defend himself with the assistance of his
representative if he so desires." Expounding
on this provision, the SC held that "ample
opportunity" connotes every kind of assistance
that management must accord the Ee to
enable him to prepare adequately for his
defense including legal representation. (U-BIX
Corp. vs. Valeria Anne Bravo, G.R. No.
177647, Oct. 31, 2008, J . Carpio-Morales)
Q: Who has the burden of proof?
A: The burden of proof rests upon the
employer to show that the dismissal of the
employee is for a just cause, and failure to do
so would necessarily mean that the dismissal
is not justified, consonant with the
constitutional guarantee of security of tenure.
Note: Due process refers to the process to be
followed; burden of proof refers to the amount of
proof to be adduced.
In money claims, the burden of proof as to the
amount to be paid the Ees rests upon the Er
since he is in custody of documents that would be
able to prove the amount 'due, such as the
payroll.
Q: What is the degree of proof?
A: In administrative or quasi-judicial
proceedings, substantial evidence is
considered sufficient in determining the legality
of an employer's dismissal of an employee.
(Pangasinan 11/ Electric Cooperative, Inc. v.
NLRC, G.R. No. 89878, Nov. 13, 1992)
Q: Perez and Doria were employed by
PT&T. After investigation, Perez and Doria
UNIVERSITY OF SANTO TOMAS ~""-", 165
PacuCtaa ae CDer ecl i o CiviC .
LABOR RELATIONS: TERMINATION OF EMPLOYMENT: PROCEDURE
were placed on preventive suspension for
30 days for their alleged Involvement in
anomalous transactions in the shipping
section. PT&T dismissed Perez and Doria
from service for falsifying documents. They
filed a complaint for illegal suspension and
illegal dismissal. The LA found that the 30-
day extension of suspension and the
subsequent dismissal were both illegal.
The NLRC reversed the LA's decision, it
ruled that Perez and Doria were dismissed
for just cause, that they were accorded due
process and that they were illegally
suspended for only 15 days (without
stating the reason for the reduction of the
period of petitioners' illegal suspension).
On appeal, CA held that they were
dismissed without due process. Whether
petitioners were illegally dismissed?
A: Yes. The Er must establish that the
dismissal is for cause in view of the security of
tenure that Ees enjoy under the Constitution
and the LC. PT&T failed to discharge this
burden. PT&T's illegal act of dismissing Perez
and Doria was aggravated by their failure to
observe due process. To meet the req'ts of
due process in the dismissal of an Ee, an Er
must furnish the worker with 2 written notices:
(1) a written notice specifying the grounds for
termination and giving to said Ee a reasonable
opportunity to explain his side and (2) another
written notice indicating that, upon due
consideration of all circumstances, grounds
have been established to justify the Er's
decision to dismiss the Ee.
There is however, no need for a hearing or
conference. "To be heard" does not mean
verbal argumentation alone inasmuch as one
may be heard just as effectively through
written explanations, submissions or
pleadings. In other words, the existence of an
actual, formal "trial-type" hearing, although
preferred, is not absolutely necessary to
satisfy the employee's right to be heard.
(Perez. v. Phil. Telegraph and Telephone
Company, G.R. No. 152048, April 7, 2009)
~ DISPROPORTIONATE PENALTY
Q: What are the guidelines in determining
whether penalty imposed on Ee is proper?
A:
1. Gravity of the offense
2. Position occupied by the Ee
3. Degree of damage to the employer
(Er)
4. Previous infractions of the same
offense
166
5. Length of service (ALU- TUCP v.
NLRC, G.R. No. 120450, Feb. 10,
1999; PAL v. PALEA, G.R. No.L-
24626, June 28,1974)
Q: Felizardo was dismissed from Republic
Flour Mills-Selecta ice cream Corporation
for dishonesty and theft of company
property for bringing out a pair of boots, 1
piece aluminum container and 15pieces of
hamburger patties. Is the penalty of
dismissal commensurate with the offense
committed?
A: There is no question that the employer has
the inherent right to discipline its Ees which
includes the right to dismiss. However this
right is subject to the police power of the State.
In this case the Court finds that the penalty
imposed upon Felizardo was not
commensurate with the offense committed
considering the value of the articles he pilfered
and the fact that he had no previous
derogatory record during his 2 years of
employment in the company. Moreover, it
should also be taken into account that
Felizardo was not a managerial or confidential
Ee in whom greater trust is reposed by
management and from whom greater fidelity to
duty is correspondingly expected. (ALU- TUCP
v. NLRC, G.R. No. 120450, Feb. 10, 1999)
, . CONSTRUCTIVE DISMISSAL
Q: What is constructive dismissal?
A: An involuntary resignation resorted to when
continued employment becomes impossible,
unreasonable, or unlikely: when there is a
demotion in rank or diminution in pay: or when
a clear discrimination, insensibility or disdain
by an Er becomes unbearable to the Ee.
(Leonardo v. NLRC, G.R. No. 125303, June 16,
2000)
Note: There is no formal dismissal. The Ee is
placed in a situation by the Er such that his
continued employment has become unbearable.
Abandonment is incompatible with constructive
dismissal.
Q: Reynaldo was hired by Geminilou
Trucking Service (GTS) as a truck driver to
haul and deliver products of San Miguel
Pure Foods Company, Inc. He was paid
P400 per trip and made 4 trips a day. He
claimed that he was requested by GTS to
sign a contract entitled " Kasunduan Sa
Pag-Upa ngSerbisyo" which he refused as
he found it to alter his status as a regular
Ee to merely contractual. He averred that
on account of his refusal to sign the
Kasunduan, his services were terminated
prompting him to file a complaint before
the NLRC for constructive dismissal
against the GTS. Would Reynaldo's refusal
to sign the Kasunduan adequately support
his allegation of constructively dismissal?
A: No. The test of constructive dismissal is
whether a reasonable person in the
employee's (Ee's) position would have felt
compelled to give up his job ~t;lnder, the
circumstances. In the present case, -the
records show that the lone piece of evidence
submitted by Reynaldo to substantiate his
claim of constructive dismissal is an unsigned
copy of the Kasunduan. This falls way short of
the required quantum of proof which is
substantial evidence, or such relevant
evidence as a reasonable mind might accept
as adequate to support a conclusion.
Reynaldo was not dismissed, but that he
simply failed to report for work after an
altercation with a fellow driver. (Madrigalejos
vs. Geminilou Trucking Service, G.R. No.
179174, Dec. 24, 2008, J. Carpio-M_orales)
Q: Flores, a conductor of J AM
Transportation Co., Inc., had an accident
where he had to be hospitalized for a
number of days. Upon reporting back to the
company he was told to wait. For several
days this continued and he was promised a
route assignment which did not materialize.
. Upon speaking to Personnel Manager
Medrano, he was told that he will be
accepted back to work but as a new
employee. Flores rejected the offer
because it would mean forfeiture of his 18
years of service to the company. Is the
offer for reinstatement as a new employee
(Ee) a constructive dismissal?
A: Yes. Flores' re-employment as a new Ee
would be very prejudicial to him as it would
mean a demotion in rank and privileges,
retirement benefits as his previous 18years of
service with the company would simply be
considered as non-existent. It amounts to
constructive dismissal. (JAM Transportation
Co., Inc. v. Flores, G.R. No. 82829, Mar. 19,
1993)
Q: Quinanola was transferred from the
position of Executive Secretary to the
Executive Vice President and General
Manager to the Production Dep't as
Production Secretary. Quinanola rejected
the assignment and filed a complaint for
illegal dismissal due to constructive
dismissal. Did the transfer of Quinanola
amount to constructive dismissal?
A: No. Quinanola's transfer was not
unreasonable since it did not involve a
demotion in rank nor a change in her place of
work nor a diminution in pay, benefits and
privileges. It did not constitute a constructive
dismissal. Furthermore, an employee's
security of tenure does not give him a vested
right in his position as would deprive the
company of its prerogative to change his
assignment or transfer him where he will be
most useful. (Philippine Japan Active Carbon
Corp. v. NLRC, G.R. No. 83239, Mar. 8, 1989)
Q: Sangil was a utility man/assistant
steward of the passenger cruise vessel
Crown odyssey under a one-year contract.
Sangil suffered head injuries after an
altercation with a Greek member of the
crew. He informed the captain that he no
longer intends to return aboard the vessel
for fear that further trouble may erupt
between him and the other Greek
crewmembers of the ship. Was Sangil
constructively dismissed?
A: Yes. There is constructive dismissal where
the act of a seaman in leaving ship was not
voluntary but was impelled by a legitimate
desire for self-preservation or because of fear
for his life Constructive dismissal does not
always involve diminution in payor rank but
may be inferred from an act of clear
discrimination, insensibility or disdain by an Er
may become unbearable on the part of the Ee
that it could foreclose any choice by him
except to forego his continued employment..
(Sunga Ship Management Phils., Inc. v.
NLRC, G.R. No. 119080, April 14, 1998)
PREVENTIVE SUSPENSION
Q: What is preventive suspension?
A: During the pendency of the investigation,
the Er may place the Ee under preventive
suspension leading to termination when there
is an imminent threat or a reasonable
possibility of a threat to the lives and
properties of the Er, his family and
representatives as well as the offender's co-
workers by the continued service of the Ee.
Q: What is the duration of preventive
suspension?
A: It should not last for more than 30 days.
The Ee should be made to resume his work
after 30 days. It can be extended provided the
Ee's wages are paid after the 30-day period.
UNIVERSITY OF SANTO TOMAS f~". 167
Pacu(taa ae < Der ecl i o Ci vi ] '9'
LABOR RELATIONS: TERMINATION OF EMPLOYMENT: PROCEDURE
This period is intended only for the purpose of
investigating the offense to determine whether
he is to be dismissed or not. It is not a penalty.
Note: The Er may continue the period of
preventive suspension provided that he pays the
salary of the Ee.
If more than 1 month, the Ee must actually be
reinstated or reinstated in the payroll. Officers are
liable only if done with malice.
Q: Cantor and Pepito were preventively
suspended pending application for their
dismissal by Manila Doctor's Hospital after
being implicated by one Macatubal when
they refused to help him when he was
caught stealing x-ray films from the
hospital. Was the preventive suspension of
Cantor and Pepito proper?
A: Where the continued employment of an Ee
poses a serious and imminent threat to the life
and property of the employer or on his co-Ees,
the Ees' preventive suspension is proper. In
this case, no such threat to the life and
property of the Er or of their co-Ee's is present
and they were merely implicated by the
Macatubal. (Manila Doctors Hospftal v. NLRC,
G.R. No 64897, Feb. 28, 1985)
168
Academics Committee
Vi ce-Chai r for L qyout &Desi gn: Loise RaeG.Naval
Labor LawCommittee
Assi stant Suo/eel H ead: Domingo B.Diviva V
Members:
Maria Krishna L.Dacayo-Garcia
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelleC.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
r- ARTS. 283-284. AUTHORIZED CAUSES
Q: What are the authorized causes of
termination by the employer (Er)?
A:
1. Installation of labor-saving devices
(automationlrobotics)
2. Redundancy (superfluity in the
performance of a particular work) -
exists where the servises ot an
employee (Ee) are in excess of what
is reasonably demanded by the
actual req'ts of the enterprise.
(Wiltshire File Co., Inc. v. NLRC, G.R.
No. 82249, Feb. 7, 1991)
Note: The redundancy should not have
been created by the Er.
3. Reorganization
Note: An Er is not precluded from
adopting a new policy conducive to a
more economical and effective
management, and the law does not
require that the Er should be suffering
financial losses before he can terminate
the services of the employee on the
ground of redundancy (DOLE Phil., Inc.
v. NLRC, GR. No. L-55413, July 25,
1983)
4. Retrenchment - cutting of expenses
and includes the reduction of
personnel; It is a management
prerogative, a means to protect and
preserve the Er's viability and ensure
his survival. To be an authorized
cause it must be affected in good
faith (GF) and for the retrenchment,
which is after all a drastic recourse
with serious consequences for the
livelihood of the Ee's or otherwise
laid-off.
Note: The phrase "to prevent losses"
means that retrenchment or termination
from the service of some Ees is
authorized to be undertaken by the Er
sometime before the anticipated losses
are actually sustained or realized.
Evidently, actual losses need not set in
prior to retrenchment. (Cajucom VII v.
TP Phils Cement Corp., et el, G.R. No.
149090, Feb. 11, 2005)
5. ClOSing or cessation of operation of
the establishment or undertaking -
must be done in good faith and not
for the purpose of circumventing
pertinent labor laws.
6: Disease - must be incurable within 6
months and the continued
employment is prohibited by law or
prejudicial to his health as well as to
the health of his co-Ees with a
certification from the public health
officer that the disease is incurable
within 6 months despite due to
medication and treatment
Q: What are other authorized causes?
A:
1. Total and permanent disability of Ee
2. Valid application of union security
clause
3. Expiration of period in term of
employment
4. Completion of project in project
employment
5. Failure in probation
6. Relocation of business to a distant
place
7. Defiance of return-to work-order
8. Commission of Illegal acts in strike
9. Violation of contractual agreement
10. Retirement
Q: What are the procedural steps required
in termination of an employee for
authorized causes?
A:
1. Written Notice to DOLE 30 days prior
to the intended day of termination.
Purpose: To enable it to ascertain the
verity of the cause of termination.
2. Written notice to Ee concerned 30
days prior the intended date of
termination.
3. Payment of separation pay - Serious
business losses do not excuse the Er
from complying with the clearance or
report required in Art. 283 of the LC
and its IRR before terminating the
employment of its workers. In the
absence of justifying Circumstances,
the failure of the Er to observe the
procedural req'ts under Art. 284 taints
their actuations with bad faith if the
lay-off was temporary but then
serious business losses prevented
the reinstatement of respondents, the
Er's should have complied with the
req'ts of written notice.
UN!VERSITY OF SANTO TOMAS ".<.\..>. 169
PacuCtaa de CDer ecl i o Civif .
LABOR RELATIONS: TERMINATION OF EMPLOYMENT: AUTHORIZED CAUSES
i REDUNDANCY- RETRENCHMENT
Q: What are the requisites of a valid
redundancy?
A:
1. Written notice served on both the
employees (Ees) and the DOLE at
least 1 month prior to separationfrom
work
2. Payment of separation pay equivalent
to at least 1 month payor at least 1
month pay for every year of service,
whichever is higher
3. Good faith in abolishing redundant
position
4. Fair and reasonable criteria in
ascertaining what positions are to be
declared redundant:
1. Less preferred status, e.g.
temporary Ee
2. Efficiencyand
3. Seniority
Q: Ong, a Sales Manager of Wiltshire File
Co., Inc., was informed of the termination
of his employment due to redundancy upon
returning from a trip abroad. Ong maintains
that there can be no redundancy since he
was the only person occupying his position
in the company.
Is there redundancy even though Ong was
the only one occupying his position.
A: Redundancy in an employer's (Er's)
personnel does not necessarily or even
ordinarily refer to duplication of work. The
characterizationofOng's services as nolonger
necessary or sustainable and therefore
properly terminable, was an exercise of
business judgment on the part of Wiltshire.
Furthermore, a position is redundant where it
is superfluous, and superfluity of a position or
positions may be the outcome of a number of
factors, such as over hiring of workers,
decreasedvolume of business, or dropping of
a particular' product line or service activity
previously manufactured or undertaken by the
enterprise. The Er has no legal obligation to
keep in its payroll more employees that are
necessary for the operation of its business.
(Wiltshire File Co., Inc. v. NLRC, GR No.
82249, Feb. 7, 1991)
Q: What are the circumstances that must
be present for a valid retrenchment?
A:
1. The losses expected should be
substantial and not merely de minimis
in extent - If the loss purportedly
sought to be forestalled by
retrenchment is clearly shown to be
insubstantial and inconsequential in
character, the bona fide nature of the
retrenchment would appear to be
seriouslyin question.
2. The substantial loss apprehended
must be reasonably imminent - as
such imminence can be perceived
objectively and in good faith by the
employer (Er). There should be a
certain degree of urgency for the
retrenchment.
3. It must be reasonably necessary and
likely to prevent the expected losse -
The Er should have taken' other
measures prior or parallel to
retrenchment to forestall losses such
as cutting other costs than labor
costs.
4. The alleged losses if already realized,
and the expected imminent losses
sought to be forestalled, must be
proved by sufficient and convincing
evidence - The reason for requiring
this quantum of proof is readily
apparent: any less exacting standard
of proof would render too easy the
abuse of this ground for termination
of services of employees. (Lopez
Sugar Corp. v. Federation of Free
Workers, GR No. 75700-01, Aug.
30, 1990)
Note: The losseswhichthe companymaysuffer
or is suffering may be proved by financial
statements audited by independent auditors
(Asian Alcohol Corporation v. NLRC, GR. No.
131108, Mar. 25, 1999)
retrenchment?
A:
1. Written notice served on both the Ee
and the DOLE at least 1 month prior
to the intended date of retrenchment
to at least one month payor at least
1/2 month pay for every year of
service, whichever is higher
3. Good faith ~ ~
4. Proof of expected or actual losses'
5. The employer used fair and
reasonable criteria in ascertaining
who would be retained among the
Ees, such as status, efficiency,
seniority, physical fitness, age, and
financial hardship of certain workers
(Asian Alcohol Corp. v. NLRC, GR.
No. 131108, Mar. 25, 1999).
Q: What are the criteria in selecting
employees (Ees) to be retrenched?
A: There must be fair and reasonable criteria
to be used in selecting Ees to be' dismissed
such as:
1. Less preferred status;
2. Efficiency rating;
3. Seniority. (Phil. Tuberculosis Society,
Inc. v. National Labor Union, GR. No.
115414, Aug. 25, 1998)
Q: What is the "last in first out (LIFO)"
rule?
A: It applies in the termination of employment
in the line of work. What is contemplated in the
LIFO rule is that when there are two or more
Ees occupying the same position in the
company affected by the retrenchment
program, the last one employed will
necessarily be the first one to go. (Maya
Farms Ees' Organization v. NLRC, G.R. No.
106256, Dec. 28, 1994)
Q: Is the seniority rule or "last in first
out" policy to be strictly followed in
effecting a retrenchment or redundancy
program?
A: Again, in Asian Alcohol Corp., the SC
stated that with regard the policy of "first
in, last out" in choosing which positions to
declare as redundant or whom to retrench to
prevent further business losses, there is no
law that mandates such a policy. The reason
is simple enough. A host of relevant factors
come into play in determining cost efficient
measures and in choosing the Ees who will
be retained or separated to save the company
from closing shop. In determining
these issues, management plays a pre-
eminent role. The characterization of positions
as redundant is an exercise of business
judgment on the part of the Er. It will be
upheld as long as it passes the test of
arbitrariness. (2001 Bar Question)
Q: What is the difference between
redundancy and retrenchment?
A: In redundancy, company has no financial
problems, unlike in retrenchment where the
company will suffer financial losses.
Q: Philippine Tuberculosis Society, Inc.
retrenched one hundred 116 Ees after
incurring deficits amounting to 9.1 million
pesos. Aside for retrenching some of its
Ees, the company also implemented cost
cutting measures to prevent such losses
for increasing and minimizing it. The NLRC
ruled that the retrenchment was not valid
on the ground that the Society did not take
seniority into account in their selection.
Was the retrenchment done by the Society
not valid for its failure to follow the criteria
laid down by law?
A: No. The Society terminated the
employment of several workers who have
worked with the Society for great number of
years without consideration for the number of
years of service and their seniority indicates
that they had been retained for such a long
time because of loyal and efficient service. The
burden of proving the contrary rest on the
Society. (Phil. Tuberculosis Society, Inc. v.
National Labor Union, G.R. No. 115414, Aug.
25, 1998)
Q: Due to mounting losses the former
owners of Asian Alcohol Corporation sold
its stake in the company to Prior Holdings.
Upon taking control of the company and to
prevent losses, Prior Holdings
implemented a reorganization plan and
other cost-saving measures and one of
them is the retrenchment of 117 employees
(Ees) of which some are members of the
union and the majority held by non-union
members. Some retrenched workers filed a
complaint for illegal dismissal alleging that
the retrenchment was a subterfuge for
union busting activities.
Was the retrenchment made by Asian
Alcohol valid and justified?
A: Yes. Even though the bulk of the losses
were suffered under the old management and
continued only under the new jnanaqernent
T
. . . . .
UilllVERSITY OF SANTO OMAS ~. ,. 171
Pacu[ taa ae i ] )er ecno CiviC ..
ultimately the new management of Prior
Holdings will absorb such losses. The law
gives the new management every right to
undertake measures to save the company
from bankruptcy. (ASian Alcohol Corp. v.
NLRC, G.R. No. 131108, Mar. 25, 1999)
:c. ' <:': Cl.OSURE . . .
closure?
A:
1. Written notice served on both the
employees (Ees) and the DOLE at
least 1 month prior to the intended
date of closure
to at least one month payor at least
1/2 month pay for every year of
service, whichever is higher, except
when closure is due to serious
business losses
3. Good faith
4. No circumvention of the law
5. No other option available to the Er
Q: What is the test for the validity of
closure or cessation of establishment or
undertaking?
A: The ultimate test of the validity of closure or
cessation of establishment or undertaking is
that it must be bona fide in character. And the
burden of proving such falls upon the Er.
(Capitol Medical Center, Inc. vs. Dr. Meris,
G.R. No. 155098, Sep. 16, 2005, J . Carpio-
Morales)
Q: When is separation pay required in case
of closure?
A: Only where closure is not due to serious
business losses nor due to an act of gov't.
(North Davao Mining Corp v. NLRC, G.R. No.
112546, Mar. 13, 1996; NFL v. NLRC, G.R.
No. 127718, Mar. 2, 2000)
Q: Galaxie Steel Corp. decided to close
down because of serious business loses. It
filed a written notice with the DOLE
informing its intended closure and the
termination of its employees (Ees). It
posted the notice of closure on the
corporate bulletin board.
Are Ees entitled to separation pay?
A: No. Galaxie had been experiencing serious
financial losses at the time it closed business
operations. Art. 283 of the LC governs the
172
grant of separation benefits "in case of
closures or cessation of operation" of business
establishments "not due to serious business
losses or financial reverses." Where, the
closure then is due to serious business losses,
the LC does not impose any obligation upon
the employer to pay separation benefits.
(Galaxie Steel Workers Union, et al. VS. NLRC,
Galaxie Steel Corp., G.R. No. 165757, Oct. 17,
2006, J . Carpio-Morales)
Q: Does the written notice posted by
Galaxie on the bulletin board sufficiently
comply with the notice req't under Art. 283
of the LC?
A: No. In order to meet the purpose, service of
the written notice must be made individually
upon each and every Ee of the company.
However, the Court held that where the
dismissal is for an authorized cause, non-
compliance with statutory due process should
not nullify the dismissal, or render it illegal, or
ineffectual. Still, the employer should
indemnify the Ee, in the form of nominal
damages, for the violation of his right to
statutory due process. (Galaxie Steel Workers
Union, et al. VS. NLRC, Galaxie Steel Corp.,
G.R. No. 165757, Oct. 17, 2006, J . Carpio-
Morales)
Q: Rank-and-flle workers of SIMEX filed a
petition for direct certification and affiliated
with Union of Filipino Workers (UFW).
Subsequently, 36 workers of the
company's "Iumpia" dep't and 16 other
workers from other dep'ts were effectively
locked out when their working areas were
cleaned out. The workers through UFW
filed a complaint for unfair labor practices
against the company. SIMEX then filed a
notice of permanent shutdownltotal cosure
of all units of operation in the
establishment with the DOLE allegedly due
to business reverses brought about by the
enormous rejection of their products for
export to the United States.
Was the closure warranted by the alleged
business reverses?
A: The closure of a business establishment is
a ground for the termination of the services of
any employee unless the closing is for the
purpose of circumventing the provisions of the
law. But, while business reverses can be a just
cause for terminating employees, they must be
sufficiently proved. In this case, the audited
financial statement of SIMEX clearly indicates
that they actually derived earnings. Although
the rejections may have reduced their earnings
they were not suffering losses. There is no
question that an employer may reduce its work
force to prevent losses but it must be serious,
actual and real otherwise this ground for
termination would be susceptible to abuse by
scheming employers who might be merely
feigning business losses or reverses in their
business ventures to ease out employees.
(Union of Filipino Workers v. NLRC, G.R. No.
90519, Mar. 23, 1992)
Q: Carmel craft Corporation closed it
business operations allegedty due to
losses of P1, 603.88 after the Carmeicraft
Ees Union filed a petition for certification
election. Carmel craft Union filed a
complaint for illegal lockout and ULP with
damages and claim for employment
benefits. Were the losses incurred by the
company enough to justify closure of its
operations?
A: The determination to cease operations is a
prerogative of management that is usually not
interfered with by the State as no business can
be required to continue operating at a loss
simply to maintain the workers in employment.
That would be a taking of property without due
process of law which the employer has a right
to resist. But where it is manifest that the
closure is motivated not by a desire to avoid
further losses but to discourage the workers
from organizing themselves into a union for
more effective negotiations with management,
the State is bound to intervene. The losses of
less than P2,OOO for a corporation capitalized
at P3 million cannot be considered serious
enough to call for the closure of the company.
(Carmelcraft Corp. v. NLRC, G.R. No. 90634-
35, June 6, 1990)
Q: Is the transferee of the closed
corporation required to absorb the
employees (Ees) of the old corporation?
A:
GR: There is no law requiring a bona fide
purchaser of assets of an on-going concern
to absorb in its employ the Ee's of the latter
except when the transaction between the
parties is colored or clothed with bad faith
(BF). In this case there is no BF since in
fact the assets were sold by Mabuhay to
pay for its obligations to its workers.
(Sundowner Dev't Corp. v. Orilon, G.R. No.
82341, Dec. 6, 1989)
XPNs:
1. Where the transferee was found to be
merely an alter ego of the different
merging firms. (Filipinas Port
Services, Inc. v. NLRC, G.R. No.
97237, A'Jg. 16, 199
1
)
2. Where the transferee voluntarily
agrees to do so. (Marina Port
Services, Inc. v. Iniego, GR. No.
77853, Jan. 22, 1990)
Q: Marikina Dairy Industries, Inc. decided
to sell its assets and close operations on
the ground of heavy losses. The unions
alleged that the financial losses were
imaginary and the dissolution was a
scheme maliciously designed to evade its
legal and social obligations to its
employees (Ees). The unions want the
buyers of the corporations assets
restrained to operate unless the members
of the unions were the ones hired to
operate the plant under the terms and
conditions specified in the collective
bargaining agreements.
Is the buyer of a company's assets
required to absorb the Ees of the seller?
A: There is no law requiring that the purchaser
of a company's assets should absorb its Ees
and the most that can be done for reasons of
public policy and social justice was to direct
that buyers of such assets to give preference
to the qualified separated Ees in the filling up
of vacancies in the facilities of the buyer. (MOil
Supervisors & Confidential Ees Ass'n (FFW) v.
Presidential Assistant on Legal Affairs, GR.
Nos. L-45421-23, Sep. 9, 1977)
PacuCtaa ae Der ecl i o CiviC
~.
.\.,. 173
Q: What is the difference between closure
and retrenchment?
A:
CLOSURE RETRENCHMENT
Is the reversal of Is the reduction of
fortune of the Er
personnel for the
whereby there is a purpose of cutting down
complete cessation of on costs of operations in
business operations terms of salaries and
to prevent further wages resorted to by an
financial drain upon Er because of losses in
an Er who cannot pay operation of a business
anymore his Ees occasioned by lack of
since business has work and considerable
already stopped. reduction in the volume
of business.
As in the case of
retrenchment, however,
One of the
for the closure of a
prerogatives of
business or a
management is the
department due to
decision to close the
serious business losses
entire establishment
to be regarded as an
or to close or abolish
authorized cause for
a department or
terminating Ees, it must
section thereof for
be proven that the
economic reasons,
losses incurred are
such as to minimize
substantial and actual or
expenses and reduce
reasonably imminent;
capitalization.
that the same increased
through a period of time;
and that the condition of
the company is not likely
to improve inthe near
future.
Does not obligate the
LC provides for the
Er for the payment of
payment of separation
separation package if
package in case of
there is closure of
retrenchment to prevent
business due to
losses.
serious losses.
. DISEASE .
Q: Whenis disease aground for dismissal?
A: Where the Ee suffers from a disease, and:
1. His continued employment is
prohibited by law or prejudicial to his
health or to the health of his co-Ees.
(Sec.8, Rule I, Book VI, IRR)
2. With a certification by competent
public health authority that the
disease is incurable within 6 months
despite due medication and
treatment. (Solis v. NLRC, GR No.
116175, Oct. 28,1996)
Note: The req't for a medical certification
cannot be dispensed with; otherwise, it
would sanction the unilateral and arbitrary
174
determination by the Er of the gravity or
extent of the Ee's illness and thus defeat the
public policy on the protection of labor.
(Manly Express v Payong, GR. No. 167462,
Oct. 25, 2005)
Termination of services for health reasons
must be effected only upon compliance with
the above requisites. The req't for a medical
certificate under Art. 284 of the LC cannot be
dispensed with; otherwise, it would sanction
the unilateral and arbitrary determination by
the Er of the gravity or extent of the Ee's
illness and thus defeat the public policy on
the protection of tabor. (Syet. al v. CA, G.R.
No. 142293, Feb. 27, 2003)
Q: What is the procedure in terminating an
employee (Ee)on the ground of disease?
A:
1. The employer (Er) shall not terminate
his employment unless:
a. There is a certification by a
competent public health authority
that
b. The disease is of such nature or
at such a stage that it cannot be
cured within a period of 6 months
even with proper medical
treatment.
2. If the disease or ailment can be cured
within the period, the Er shall not
terminate the Ee but shall ask the Ee
to take a leave. The Er shall reinstate
such Ee to his former position
immediately upon the restoration of
his normal health. (Sec. 8, Rule I,
Book VI, IRR)
Q: Is anemployee suffering from a disease
entitled to reinstatement?
A: Yes, provided he presents a certification by
a competent public health authority that he is
fit to retum to work. (Cebu Royal Plant v.
Deputy Minister, G.R. No. L-58639,' Aug. 12,
1987)
Q: Is the req't of a medical certificate
mandatory?
A: Yes, it is only where there is a prior
certification from a competent public authority
that the disease afflicting the employee sought
to be dismissed is of such nature or at such
stage that it cannot be cured within 6 months
even with proper medical treatment that the
latter could be validly terminated from his job.
(Tan v. NLRC, G. R. No. 116807, April 14,
1997)
Note: Termination from work on the sole basis of
actual perceived or suspected HIV status is
deemed unlawful. (Sec. 35, R.A. 8504 HIV/AIDS
Law)
Q: Anna Ferrer has been working as
bookkeeper at Great Foods, Inc., which
operates a chain of high-end restaurants
throughout the country, since 1970 when it
was still a small eatery at Binondo. In the
early part of the year 2003, Anna, who was
already 50 years old, reported $or w.prk
after a week-long vacation in her province.
It was the height of the SARS scare, and
management learned that the first
confirmed SARS death case in the Phils, a
"balikbayan" nurse from Canada, is a
townmate of Anna. Immediately, a
memorandum was issued by management
terminating the services of Anna on the
ground that she is a probable carrier of
SARS virus and that her continued
employment is prejudicial to the health of
her co-Ees. Is the action taken by the
employer (Er) justified?
A: The Er's act of terminating the employment
of Anna is not justified. There is no showing
that said employee is sick with SARS, or that
she associated or had contact with the
deceased nurse. They are merely town mates.
Furthermore, there is no certification by a
competent public health authority that the
disease is of such a nature or such a stage that
it cannot be cured within a period of 6 months
even with proper medical treatment.
(Implementing Rules, Book VI, Rule 1, Sec. 8,
LC) (2004 Bar Question)
Q: Discuss the rules on separation pay with
regard to each cause of termination.
A:
CAUSE OF
SEPARATION PAY
TERMINATION
Equivalent to at least 1
month payor at least 1
Automation
month pay for every year
of service, whichever is
higher
Redundancy
higher
Equivalent to 1 month pay
Retrenchment
or at least Y, month pay
for every year or service
Closures or
cessation of
operation not due
to serious
business
of service (if due to severe
losses/financial
financial losses, no
reverses
separation pay
month payor at least Y,
Disease
higher
Note: A fraction of at least 6 months shall be
considered 1whole year.
There is no separation pay when the closure is
due to an act of the gov'!.
Q: What is the purpose of the 2 notices
served to the Ee and DOLE 1 month prior to
termination?
A:
1. To give the Ees some time to prepare
for the eventual loss of their jobs and
their corresponding income, look for
other employment and ease the
impact of the loss of their jobs.
2. To give DOLE the opportunity to
ascertain the verity of the alleged
cause of termination. (Phil. Telegraph
& Telephone Corp. v. NLRC, G.R. No.
147002, April 15, 2005)
Note: Notice to both the Ees concerned and the
DOLE are mandatory and must be written and
given at least 1 month before the intended date of
retrenchment - and the fact that the Ees were
already on temporary lay-off at the time notice
should have been given to them is not an excuse
to forego the 1-month written notice. (Sebuguero
V. NLRC, G.R. No. 115394, Sep. 27, 1995)
Pacu{ tati ti e ([ )er ecl i o Ci'f)i{
.~ 175
Q: DAP Corp. ceasedits operation due to
the termination of its distribution
agreement with Int'I Distributors Corp.
which resulted in its need to cease its
business operations and to terminate the
employmentof its Ees.Marcial et al. filed a
complaint for illegal dismissal and for
failure to give the Ees written notices
regarding the -termination of their
employment. On the other hand, DAP
claims that their Ees actually knewof the
termination therefore the written notices
were no longer required. Are written
notices dispensedwith whenthe Ees have
actualknowledgeof theredundancy?
A: The Ees' actual knowledge of the
termination of a company's distributorship
agreement with another company is not
sufficient to replace the formal and written
notice required by law. In the written notice,
the Ees are informed of the specific date of the
termination, at least a month prior to the date
of effectivity, to give them sufficient time to
make necessary arrangements. In this case,
notwithstanding the Ees knowledge of the
cancellation of the distributorship agreement,
they remained uncertain about the status of
their employment when DAP failed to formally
inform them about the redundancy. (DAP
Corp. v. CA, G.R. No. 165811, Dec. 14,2005)
176
Academics Committee
Vi ce-Chai r j or Academi cs: J eannie A.Laurentino
Vi ce-Chai r j or Admi n &F i nance: .AissaCelineH.Luna
Labor Law Committee
Sl I bj ect H ead: Lester] ayAlanE.Flores II
Assi stant Sl I bj ect H ead' Domingo B.Diviva V
Members:
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelle C.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
.~.~.~7
' ' ' : ' Ar '
, CONSEQUENCES OF DISMISSAL
. DISMISSAL WITHOUT CAUSE .
" DISMISSAL WITH CAUSE
Q: When is a dismissal deemed valid?
A:. If the same was effected:
1. For a just or authorized cause; and
2. With due process
Q: Distinguish the status of dismissals vis-
a-vis the presence of a valid cau\Se and: due
process.
A:
! With Cause
With Due Status of
Process Dismissal
Yes Yes Valid
No Yes lIIeaal
No No lileoal
Valid, but with
Yes No
payment of
nominal
darnaqes
Q: What is the amount of nominal damages
that an Ee dismissed with cause but
without due process is entitled to?
A:
1. Authorized causes - P50, 000
2. Just causes - P30, 000
Note: In Agabon v. NLRC, G.R. No. 158693,
Nov. 17, 2004, it was held that when dismissal is
for just or authorized cause but due process was
not observed, the dismissal should be upheld.
However, the employer (Er) should be held liable
for non-compliance with the procedural req'ts of
due process (e.g. damages). The Agabon ruling
was modified by JAKA Food Processing v, Pacot
(G.R. No. 515378, Mar. 28, 2005) where it was
held that:
1. If based on just cause (Art. 282) but the
Er failed to comply with the notice req't,
the sanction to be imposed upon him
should be tempered because the
dismissal process was, in effect,
initiated by an act imputable to the Ee;
and
2. If based on authorized causes (Art. 283)
but the Er failed to comply with the
notice req't, the sanction should be
stiffer because the dismissal process
was initiated by Er's exercise of his
management prerogative.
Q: What are the remedies available to a
illegally dismissed employee (Ee)?
A: An Ee who is unjustly dismissed from wo
shall by entitled to:
1. Reinstatement without loss
seniority rights and
2. Full backwages. (Sec. 3, Rule I, Book
VI,IRR)
3. Separation pay in lieu f
reinstatement, if the latter is no longe
feasible
Q: What is reinstatement?
A: It is the restoration of the employee to the
state from which he has been unjustly
removed or separated without loss of senior' y
rights and other privileges.
Q: What are the forms of reinstatement?
A:
1. Actual or physical - the emplo_ee
(Ee) is admitted back to work
2. Payroll- the Ee is merely reinstateo
in the payroll
Note: An order of reinstatement by the LA is or
the same as actual reinstatement of a dismisseo
or separated Ee. Thus, until the Er continuousl
fails to actually implement the reinstateme
aspect of the decision of the LA, their obligati
to the illegally dismissed Ee, insofar as accrueo
backwages and other benefits are concerned,
continues to accumulate. It is only when the
illegally dismissed Ee receives the separation pa
(in case of strained relations) that it could be
claimed with certainty that the Er-Ee realtions hi
has formally ceased thereby precluding t e
possibility of reinstatement. In the meantime, t e
iII~ally dismissed Ees entitlement to backwages,
13 month pay, and other benefits subsists. U Itl
the payment of separation pay is carried out, t e
Er should not be allowed to remain unpunished
for the delay, if not outright refusal, t
immediately execute the reinstatement aspect -
the LA's decision.
Further, the Er cannot refuse to reinstate the
illegally dismissed Ee by claiming that the latter
had already found a job elsewhere. Minimum
wage earners are left with no choice after they
are illegally dismissed from their employment, but
to seek new employment in order to earn a
decent living. Surely, we could not fault them for
their perseverance in looking for and eventuall
securing new employment opportunities instead
of remaining idle and waiting the outcome of the
case. (Triad Security & Allied Services, Inc. et al
v. Ortega, G.R. No. 160871, Feb. 6, 2006).
LABOR RELATIONS: CONSEQUENCES OF DISMISSAL
Q: What are Arts. 223 from 279 of the LC?
A:
: Art.279 _ Art. 223
May be availed of as
soon as the labor
arbiter renders a
judgment declaring
that the dismissal of
the Ee is illegal and
ordering said
reinstatement. It may
be availed of even
pending appeal
Presupposes that the
judgment has already
become final and
executory.
Consequently, there is
nothing left to be done
except the execution
thereof.
Note: An award or order for reinstatement is self-
executory. It does not require the issuance of a
.writ of execution. (Pioneer Texturizing Corp. v.
NLRC, G.R.No. 118651, Oct. 16, 1997)
Q: PAL dismissed Garcia, et al. for violating
PAL's Code of Discipline for allegedly
sniffing shabu in PAL's Technical Center
Toolroom Section. Garcia, et al. then filed
for illegal dismissal and damages where
the Labor Arbiter (LA) ordered PAL to
Immediately reinstate the Garcia, et al. On
appeal, the NLRC reversed the decision
and dismissed Garcia's et al. complaint for
lack of merit Garcia's et al. motion for
reconsideration was denied by the NLRC. It
affirmed the validity of the writ and the
notice Issued by the LA but suspended and
referred the action to the Rehabilitation
Receiver for appropriate action. Whether
Garcia, et al. may collect their wages
during the period between the LA's order of
reinstatement pending appeal and the
NLRC decision overturning that of the LA?
A: Par. 3 of Art. 223 of the LC provides that
the decision of the LA reinstating a dismissed
or separated Ee, insofar as the reinstatement
aspect is concerned, shall immediately be
executory, pending appeal.
Even if the order of reinstatement of the LA is
reversed on appeal, it is obligatory on the part
of the Er to reinstate and pay the wages of the
dismissed Ee during the period of appeal until
reversal by the higher court. On the other
hand, if the Ee has been reinstated during the
appeal period and such reinstatement order is
reversed with finality, the Ee is not required to
reimburse whatever salary he received for he
is entitled to such, more so if he actually
rendered services during the period.
In other words, a dismissed Ee whose case
was favorably decided by the LA is entitled to
receive wages pending appeal upon
reinstatement, which is immediately
executory. Unless there is a restraining order,
it is ministerial upon the LA to implement the
liB
order of reinstatement and it is mandatory on
the Er to comply therewith. (Gercis vs. PAL,
G.R. No. 164856, Jan20, 2009)
Q: What is the effect of the reversal of LA's
decision to the reinstated employee (Ee)?
A: If the decision of the LA is later reversed on
appeal upon the finding that the ground for
dismissal is valid, then the Er has the right to
require the dismissed Ee on payroll
reinstatement to refund the salaries he/she
rec~ived while the case was pending appeal,
or It can be deducted from the accrued
benefits that the dismissed Ee was entitled to
receive from the employer under existing laws,
CSA provisions, and company practices .
However, if the Ee was reinstated to work
during the pendency of the appeal, then the Ee
is entitled to receive the compensation
received for actual services rendered without
need of refund (Cffibank v. NLRC, G.R. No.
142732-33, Dec. 4, 2007).
Q: Maya court order the reinstatement of a
dismissed employee (Ee) even if the prayer
of the complaint did not include such
relief?
A: Yes. So long as there is a finding that the
Ee was illegally dismissed, the court can order
the reinstatement of an Ee even if the
complaint does not include a prayer for
reinstatement, unless, of course the Ee has
waived his right to reinstatement. By law, an
Ee who is unjustly dismissed is entitled to
reinstatement among others. The mere fact
that the complaint did not pray for
reinstatement will not prejudice the Ee,
because technicalities of law and procedure
are frowned upon in labor proceedings
(Pheschem Industrial Corp. v. Moldez, G.R.
No. 1161158, May 9,2005).
Q: What happens if there is an Order of
Reinstatement but the position is no longer
available?
A: The employee (Ee) should be given a
substantially equivalent position. If no
substantially equivalent position is available,
reinstatement should not be ordered because
that would in effect compel the employer to do
the impossible. In such a situation, the Ee
should merely be given a separation pay
consisting of 1-month salary for every year of
service (GroJier Int'l Inc. v. ELA, G.R. No.
83523, Aug. 31, 1989).
Q: What are the instances when separation
pay in lieu of reinstatement proper?
A: Proceeds from an illegal dismissal wherein
reinstatement is ordered but cannot be carried
out as in the following cases:
1. Reinstatement cannot be effected in
view of the long passage of time or
because of the realities of the
situation.
2. It would be inimical to the~emploers'
interest.
3. When reinstatement is no longer
feasible.
4. When it will not serve the best
interest of the parties involved.
5. Company will be prejudiced by
reinstatement.
6. When it will not serve a prudent
purpose.
7. When there is resultant strained
relation (applies to both confidential
and managerial employees (Ees)
only).
8. When the position has been
abolished (applies to both
managerial, supervisory and rank-
and-file Ees).
Q: How can separation pay be viewed?
A: Under present laws and jurisprudence,
separation pay may be viewed in 4 ways:
1. In lieu of reinstatement in illegal
dismissal cases, where Ee is ordered
reinstated but reinstatement is not
feasible.
2. As Er's statutory obligation in cases
of legal termination due to authorized
causes under Art. 283 and 284 of the
LC.
3. As financial assistance, as an act of
social justice and even in case of
legal dismissal under Art. 282 of the
LC.
4. As employment benefit granted in
CSA or company policy. (Po quiz,
2005)
Q: What is the difference between a
dismissal without cause and dismissal for
a non-existent cause?
A:
1. Dismissal wfthout cause - It is the
intention of the Er to dismiss his Ee
for no cause whatsoever, in which
case the termination pay law would
apply.
2. Dismissal for a non-existent cause -
the Er does not intend to dismiss t e
Ee but for a specific.zcause whic
turns out to be false or non-existen:.
(Pedroso v. Castro, G.R. No. 7036 .
Jan. 30, 1986)
Q: What is the remedy in case the
dismissal was for a non-existent cause?
A: An employee who is separated from wor'
without just cause shall be reinstated to his
former position, unless such position no longe
exists at the time of his reinstatement, in whic
case he shall be given a substantially
equivalent position in the same establishme
without loss of seniority rights. (Sec. 4[a), Rule
I, Book VI, IRR)
Q: J avier, an Ee for Standard Electric
Manufacturing Corporation, was charged
with rape and was detained. Standard
Electric moved to dismiss him for being
absent without leave and for committing
rape. Upon acquittal, J avier reported for
work but standard Electric refused to
accept him back. Was Standard Electric's
act valid?
A: No. The trial court dismissed the case 0
insufficiency of evidence and such ruling is
tantamount to an acquittal of the cri e
charged and proof that J avier's arrest a
detention was without factual and legal basis
in the first place. Standard Electric's ac .
dismissing J avier on committing rape wit 0
trial shows that the company prejudged i
and preempted the ruling of the RTC ara
adjudged J avier guilty without due process '
law. While it may be true that after
preliminary investigation of the complai
probable cause, for rape was found a
respondent J avier to be detained, ese
cannot be made as legal bases for immedia e
termination of his employment. (Standa
Electric Manufacturing Corp. v. Standa c:
Electric Ees Union, G.R. No. 166111 Aug. 25
2005)
Q: Is an illegally dismissed Ee entitled t
reinstatement as a matter of right?
A:
GR: Yes.
XPN:
1. Where reinstatement is not feasi c
expedient or practical, as w eOB
reinstatement would only exacer a e
the tension and strained relatio s
between the parties, or
Pacu{ taa de i Der echo Ci vi C
2. Where the relationship between the
Er and Ee has been unduly strained
by reason of their irreconcilable
differences, particularly where the
illegally dismissed Ee held a
managerial or key position in the
company
Note: In such cases, it would be more
prudent to order payment of separation
pay instead of reinstatement. (Quijano
v. Mercury Drug Corporation, G.R. No.
126561, July 8, 1998)
Q: What is the doctrine of strained
relations?
. A: When the Er can no longer trust the Ee and
vice versa, or there were imputations of bad
faith to each other, reinstatement could not
effectively serve as a remedy. This doctrine
applies only to positions which require trust
and confidence (Globe Mackay v. NLRC, G.R.
No. 82511, March 3, 1992).
Under the circumstances where the
employment relationship has become so
strained to preclude a harmonious working
relationship and that all hopes at reconciliation
are naught after reinstatement, it would be
more beneficial to accord the Ee backwages
and separation pay.
Q: What must be proven before the
principle of strained relations can be
applied to a particular case?
A:
1. The Ee concerned occupies a
position where he enjoys the trust
and confidence of his Er; and
2. That it is likely that if reinstated, an
atmosphere of antipathy and
antagonism may be generated as to
adversely affect the efficiency and
productivity of the Ee concerned.
(Globe Mackay Cable & Wire Corp. v.
NLRC G.R.No. 82511, Mar. 3, 1992)
Q: Does the doctrine of strained
relationship always bar reinstatement in all
cases?
A: No. The doctrine should be applied on a
case to case basis, based on each case's
peculiar conditions and not universally.
Otherwise, reinstatement can never be
possible simply because some hostility is
invariably engendered between the parties as
a result of litigation. That is human nature.
(Anseor Transport v. NLRC, G.R. No. 85894,
Sept. 28, 1990)
Besides, no strained relations should arise
from a valid and legal act of asserting one's
right; otherwise an Ee who shall assert his
right could be easily separated from the
service, by merely paying his separation pay
on the pretext that his relationship with his
employer (Er) had already become _strained.
(Globe Mackay Cable 8, Wire Corp. v. NLRC,
G.R.No. 82511, Mar. 3, 1992)
Q: Respondents are licensed drivers of
public utility jeepneys owned by Moises
Capili. When Capili assumed ownership
and operation of the jeepneys, the drivers
were required to sign individual contracts
of lease of the jeepneys. The drivers'
gathered the impression that signing the
contract was a condition precedent before
they could continue driving. The drivers
stopped plying their assigned routes and a
week later filed with the Labor Arbiter a
complaint for illegal dismissal praying not
for reinstatement but for separation pay.
Are the respondents entitled to separation
pay?
A: No. When drivers voluntarily chose not to
return to work anymore, they must be
considered as having resigned from their
employment. The common denominator of
those instances where payment of separation
pay is warranted is that the employee was
dismissed by the employer. (Capili v. NLRC,
G.R. 117378, Mar. 26, 1997)
Q: Two groups of seasonal workers
claimed separation benefits after the
closure of Phil. Tobacco processing plant
in Balintawak and the transfer of its
tobacco operations to Candon, tlocos Sur.
Phil. Tobacco refused to grant separation
pay to the workers belonging to the first
batch (Lubat group), because they had not
been given work during the preceding year
and, hence, were no longer in its employ at
the time it closed its Balintawak plant.
Likewise, it claims exemption from
awarding separation pay to the second
batch (Luris group), because the closure of
its plant was due to "serious business
losses," as defined in Art. 283 of the LC.
Both labor agencies held that the Luris and
Lubat groups were entitled to separation
pay equivalent to 1/2 month salary for
every of service, provided that the Ee
worked at least 1 month in a given year. Is
the separation pay granted to an illegally
dismissed Ee the same as that provided
under Art. 283 of the LC in case of
retrenchment to prevent losses?
A: No. The separation pay awarded to
employees due to illegal dismissal is different
from the amount of separation pay provided for
in Art. 283 of the LC. Prescinding from the
above, Phil. Tobacco is liable for illegal
dismissal and should be responsible for the
reinstatement of the Lubat group and the
payment of their backwages. However, since
reinstatement is no longer possible as Phil.
Tobacco have already closed its Balintawak
plant, members of the said group should
instead be awarded normal sep'\'jation pay (in
lieu of reinstatement) equivalent to at least one
month pay, or one month pay for every year of
service, whichever is higher. It must be
stressed that the separation pay being
awarded to the Lubat group is due to illegal
dismissal; hence, it is different from the
amount of separation pay provided for in
Article 283 in case of retrenchment to prevent
losses or in case of closure or cessation of the
Er's business, in either of which the separation
pay is equivalent to at least one (1) month or
one-half (1/2) month pay for every year of
service, whichever is higher. (Phil. Tobacco
Flue-Curing & Redrying Corp. v. NLRC, G.R.
No. 127395, Dec. 10, 1998)
Q: Differentiate Art. 279of the LC fromSec.
7of R.A. 10022.
A:
I Art. 279,lC (local . Sec. 7, RA 10022
! Workers) (MigrantWorkers)
Reinstatement
Full backwages from
the time of his
compensation was
withheld from him up
to the time of his
actual reinstatement.
Full Reimbursement of
his placement fee with
interest of 12% per
annum.
l BACKWAGES
Q: What are backwages?
A: It is the relief given to an employee (Ee) to
compensate him for the lost earnings during
the period of his dismissal. It presupposes
illegal termination.
Note: Entitlement to backwages of the illegally
dismissed Ee flows from law. Even if he does not
ask for it, it may be given. The failure to claim
backwages in the complaint for illegal dismissal is
a mere procedural lapse which cannot defeat a
right granted under substantive law. (St.
Michael's Institute v. Santos, G.R. No. 145280,
Dec. 4, 2001)
Q: What is the
backwages to an
employee (Ee)?
basis of awarding
illegally dismissed
A: The payment of backwages is generally
granted on the ground of equity. It is a form of
relief that restores the income that was lost by
reason of the unlawful dismissal; the grant
thereof is intended to restore the earnings that
would have accrued to the dismissed Ee
during the period of dismissal until it is
determined that the termination of employment
is for a just cause. It is not private
compensation or damages but is awarded in
furtherance and effectuation of the public
objective of the LC. Nor is it a redress of a
private right but rather in the nature of a
command to the employer to make public
reparation for dismissing an Ee either due to
the former's unlawful act or bad faith. (Tomas
Claudio Memorial College Inc., v. GA, G.R. No.
152568, Feb. 16,2004)
Q: What is the period covered by the
payment of backwages?
A: The backwages shall cover the period from
the date of dismissal of the employee up to the
date of:
1. if
2.
Actual reinstatement, or
reinstatement is no longer feasible
Finality of judgment awarding
backwages (Buhain v. CA, G.R.
143709, July 2, 2002)
Note:The backwages to be awarded should not
be diminished or reduced by earnings elsewhere
during the period of his illegal dismissal. The
reason is that the Ee while litigating the illegality
of his dismissal must earn a living to support
himself and his family. (Bustamante v. NLRC,
GR. No. 111651, Mar. 15, 1996; Buenviaje v.
CA G.R. No. 147806, Nov. 2002)
Q: What is included in the computation of
backwages?
A: They cover the following:
1. Transportation and emergency
allowances
2. Vacation or service incentive leave
and sick leave
3. ia" month pay
Note:Facilities such as uniforms, shoes, helmets
and ponchos should not be included in the
computation of backwages because said items
are given for free, to be use only during official
tour of duty not for private or personal use.
The award of backwages is computed on the
basis of 30-day month. (JAM Trans Co. v. Flores,
G.R. No. L-63555, Mar. 19, 1993)
Pacu{ taa ae < Der ecfzo CiviC
Q: What does the tenn "full backwages"
mean?
A: R.A. 6715 points to "full backwages" as
meaning exactly that, i.e., without deducting
from backwages the earnings derived
elsewhere by the concerned Ee during the
period of his illegal dismissal. (Buenviaje v.
CA, G.R. 147806, Nov. 12,2002)
The underlying reason for this ruling is that the
employee, while litigating the legality (illegality)
of his dismissal, must still earn a living to
support himself and family, while full
backwages have to be paid by the employer
as part of the price he has to pay for illegally
dismissing his Ee. (Bustamante v. NLRC, G.R.
No. 111651, Mar. 15, 1996)
Q: Is an Ee entitled to backwages even
aftertheclosure of the business?
A: Yes. The closure of the business rendered
the reinstatement of complainant to her
previous position impossible but she is still
entitled to the payment of backwages up to the
date of dissolution or closure. An employer
found guilty of unfair labor practice in
dismissing his Ee may not be ordered to pay
backwages beyond the date of closure of
business where. such closure was due to
legitimate business reasons and not merely an
attempt to defeat the order of reinstatement.
(Pizza Inn v. NLRC, G.R. No. 74531, June 28,
1988)
Q: Whatarethe circumstances that prevent
awardof backwages?
A:
1. Dismissal for cause
2. Death, physical or mental incapacity
of the employee
3. Business reverses
4. Detention in prison
: DAMAGES
Q: What is the basis for awarding moral
and exemplary damages to an illegally
dismissed employee(Ee)?
A: In moral damages, it suffices to prove that
the claimant has suffered anxiety, sleepless
nights, besmirched reputation and social
humiliation by reason of the act complained of.
Exemplary damages, on the other hand, are
granted in addition to, inter alia, moral
damages "by way of example or correction for
the public good "if the employer" acted in a
wanton, fraudulent, reckless, oppressive or
182
malevolent manner. (Phil. Aeolus v. NLRC,
G.R. No. 124617, April 28, 2000)
As a rule, moral damages are recoverable only
where the dismissal of the Ee was attended by
bad faith or fraud or constituted an act
oppressive to labor, or were done in a manner
contrary to morals, good customs or public
policy. On the other hand, exemplary damages
may be awarded only if the dismissal was
effected in a wanton, oppressive or malevolent
manner. (Estiva v. NLRC, G.R. No. 95145,
Aug. 5, 1993)
, LIABILITY FOR MONETARY CLAIMS
Q: What must first be proven before an
officer' of a corporation can be held
solidarily liable with the corporation for the
payment of separation pay and other labor
standard benefitsto its employees (Ees)?
A:
GR: Corporation is vested by law with a
personality separate and distinct from the
persons composing it, including its officers
as well as from that of any other legal entity
to which it may be related. (Pabalan v.
NLRC, G.R. No. 89879, April 20, 1990)
XPN: To justify solidary liability:
1. There must be an allegation or
showing that the officers of the
corporation deliberately or maliciously
designed to evade the financial
obligation of the corporation to its
Ees, or
2. A showing that the officers
indiscriminately stopped its business
to perpetrate an illegal act, as a
vehicle for the evasion of existing
obligations, in circumvention of
statutes, and to confuse legitimate
issues. (Reah's Corp.n v. NLRC G.R.
No. 117473, Apr. 15, 1997)
t" ART. 285. TERMINATION BY THE
: . EMPLOYEE _ __
Q: How can an employee (Ee) terminate his
service with his employer (Er)?
A:
1. Without just cause - by serving
written notice on the Er at least 1
month in advance. The Er upon
whom no such notice was served
may hold the Ee liable for pam ages.
With just cause - an Ee may put an
end to employment without serving
any notice on the Er for any of the
following just causes:
a. Serious insult by the Er or his
representative on the hour and
person of the Ee
b. Inhuman and unbearable
treatment accorded the Ee by the
Er or his representative
c. Commission of a crime or
offense by the Er or his
representative against the
person of the Ee or any of the
immediate members of his family
d. Other causes analogous to any
of the foregoing
2.
Q: When is employment not deemed
terminated?
A:
1. Bona fide suspension of the operation
of a business or undertaking for a
period not exceeding 6 months, or
2. The fulfillment by the Ee of a military
or civic duty shall not terminate
employment.
Note: In all such cases, the Er shall reinstate the
Ee to his former position without loss of seniority
rights if he indicates his desire to resume his
work not later than 1 month from the resumption
of operations of his Er or from his relief from the
military or civic duty. (Art. 286)
Q: What is the term of "floating status" of
an employee (Ee)?
A: The "flo.ating" status of an Ee should last
only for a legally prescribed period of time.
When the floating status of an Ee lasts for
more than 6 months, he may be considered to
have constructively dismissed from service.
Thus, he is entitled to corresponding benefits
for separation pay. (Agro Commercial Security
Services Agency Inc. v. NLRC, GR. Nos.
82823-24" July 31, 1989)
Note: It is legal, such as in the case of security
guards who have no assignment.
In security agency parlance, being placed "off-
duty" or on "floating status" means "waiting to be
posted."
In case of temporary lay-off Ees, there is no
specific provision of law which treats of a
temporary retrenchment or lay-off and provides
for the requisites in effecting it or a period of
duration therefore. These Ees, cannot however
be forever "temporarily laid-off'. To remedy the
situation, Art. 286 may be applied by analogy to
set a specific period that Ees may remain
temporarily laid-off or in floating status. There
fore It must not exceed 6 months (Art. 286 of the
LC).
Q: Ernelson Trojillo was a driver for
Nelbusco, Inc. The air-conditioning unit of
the bus he drives broke down and he was
placed in floating status until repair was
made. Trojillo reported to the bus company
but the air-conditioning unit for the bus has
not been repaired. Several months elapsed
without the company giving him another
bus to drive or having the bus repaired.
Trojillo then filed an illegal dismissal case
when he learned that the bus he drove was
used as an ordinary bus by a newly-hired
driver. Was there a constructive dismissal
despite the fact that the bus was
unserviceable?
A: Under Art. 286 of LC, if an Ee is forced to
remain without work or assignment for a period
exceeding 6 months, then he is in effect
constructively dismissed. When the reason for
the stoppage of operation of the bus assigned
to Trojillo was the breakdown of the air-
conditioning unit such suspension should only
last for a reasonable period of time. The defect
could have been easily remedied by the bus
company. The period of 6 months is more than
enough and beyond that period the stoppage
was already legally unreasonable and
economically prejudicial to Trojillo who was not
give a substitute vehicle to drive. (Valdez v.
NLRC, G.R.No. 125028, Feb. 9, 1998)
RETIREMENT .
Q: What is retirement?
A: .It is the result of a bilateral act of the
parties, a voluntary agreement between the
employer and the employees whereby the
latter after reaching a certain age agrees
and/or consents to sever his employment with
the former. (Soberano v. Sec. of Labor, GR.
Nos. L-43753-56 and L-50991, Aug. 29, 1980)
,
.....
UNIVERSITY OF SANTO TOMAS 4-; ~ 183
PacuCtaa d (] )er ecl i o Ci dC .~.
LABOR RELATI ONS: TERMI NATI ON OF EMPLOYMENT: By EMPLOYEE
Q: What are the kinds of retirement
schemes?
A:
1. Compulsory and contributory in
nature;
2. One set up by the agreement
between the employer (Er) and
employees (Ees) in the CSA or other
agreements between them (other
applicable employment contract);
3. One that is voluntarily given by the
Er, expressly as announced company
policy or impliedly as in the failure to
contest the Ee's claim for retirement
benefits. (Marilyn Odchimar Geriech
v. Reuters Limited, Phils., G.R. No.
148542, Jan. 17, 2005)
Q: Who are covered by the LC provisions
on retirement?
A:
GR: All employees (Ees) in the private
sector:
1. Regardless of their position,
designation or status; and
2. Irrespective of the method by which
their wages are paid. (Sec. 1, Rule II,
Book VI, IRR)
XPN:
1. Ees of the National Gov't and its
political subdivisions, including
GOCCs (if they are covered by the
Civil Service Law)
personal service of another
3. Ees of retail, service, and agricultural
establishments or operations
employing not more than 10 Ees
(Sec.2, Rule II, Book VI, IRR)
Q: What is the retirement age?
A: It is the age of retirement that is specified in
the:
1. CSA; or
2. Employment contract; or
3. Retirement plan (Sec. 3, Rule II, Book
VI, IRR).
4. Optional retirement age for
underground mining employees: 50-
60 years provided they have at least
served for a period of 5 years.
(Art. 285 as amended by R.A. 8558)
Q: What is the retirement age in the
absence of a retirement plan or other
applicable agreement?
A:
1. Optional - 60 years old / 5 years in
service (includes authorized
absences, vacations, regular
holidays, mandatory military or civic
service)
Note: The option to retire upon
reaching the age of 60 years or more
but not beyond 65 is the exclusive
prerogative, of the employee (Ee) if
there is no provision on retirement in a
CSA or any other agreement or if the
employer (Er) has no retirement plan.
(R.A. 7641; Capili v. NLRC, G.R. No.
117378, Mar. 26, 1997)
2. Compulsory 65 years old,
regardless of years of service
(company is not bound to dismiss Ee;
it is automatic). (Sec. 4, Rule II, Book
VI,IRR)
Note: Retirement benefits, where not
mandated by law, may be granted by
agreement of the Ees and their Er or as
a voluntary act on the part of the Er.
Retirement benefits are intended to
help the Ee enjoy the remaining years
of his life, lessening the burden of
worrying for his financial support, and
are a form of reward for his loyalty and
service to the Er (Aquino v, NLRC, G.R.
No. 87653, Feb. 11, 1992) .
Q: Is compulsory retirement age below 60
allowed?
A: Yes. Art. 287 permits Er and Ee to fix the
applicable retirement age at below 60. The
same is legal and enforceable so long as the
parties agree to be governed by such CBA.
(Pantranco North Express v. NLRC, G.R. No.
95940, July 24, 1996)
Q: What is the rule for extension of service
of retiree upon his reaching the
compulsory retirement age?
A: Upon the compulsory retirement of an
employee (Ee) or official in the public or
private service, his employment is deemed
terminated. The matter of extension of service
of such Ee or official is addressed to the sound
discretion of the Er. (UST Faculty Union v.
NLRC, G.R. No. 89885, Aug. 6,1990)
Q: What are retirement benefits?
A: In the absence of an applicable agreement
or retirement plan - A retiree is entitled to a
retirement pay equivalent to at least % month
salary for every year of service, a fraction of at
least 6 months being considered as 1 whole
year. (Sec. 5. 1, Rule II, Book VI, IRR)
Q: What comprises % month salary?
A: Unless parties provide fqr broader
inclusions:
1. 15 days salary based on latest salary
rate;
2. Cash equivalent of not more than 5
days of service incentive leaves
(22.5/year of service)
3. 1/12 of the 13
th
month pay
4. All other benefits as may be agreed
upon by the employer and employee
(Ee). (Sec. 5.2, Rule II, Book VI, IRR)
Note: Under Sec. 26 of R.A. No. 4670,otherwise
known as Magna Carta for Public School
Teachers, public school teachers having fulfilled
the age and service req'ts of the applicable
retirement laws shall be given one range salary
raise upon the retirement, which shall be the
basis of the computation of the lump sum of the
retirement pay and monthly benefit thereafter.
Q: Can Art. 287 of the LC (on retirement) as
amended by R.A. 7641 be applied
retroacti.vely?
A: Yes, provided:
1. The claimant for retirement benefits
was still the employee of the
employer at the time the statute took
effect; and
2. The claimant was in compliance with
the req'ts for eligibility under the
statute for such retirement benefits.
(PSVSIA v. NLRC, G.R. No. 115019,
April 14, 1997)
Q: Are the proviSions of the retirement plan
binding as part of the employment
contract?
A: Yes. The retirement plan forms part of the
employment contract since it is made known to
the Ees and accepted by them, and such plan
has an express provision that the company
has the choice to retire an Ee regardless of
age, with 20 years of service, said policy is
within the bounds contemplated by the LC.
Moreover, the manner of computation of
retirement benefits depends on the stipulation
provided in the company retirement plan.
(Progressive Dev't Corporation v. NLRC, G.R.
No. 138826, Oct.30, 2000)
Q: Rivera was employed as senior
manufacturing pharmacist by UNILAB. She
later became Director of UNILAB's
Manufacturing Division. UNILAB adopted a
comprehensive retirement plan (the plan or
retirement plan) supported by a retirement
fund. A member is compulsorily retired
upon reaching age 60 or has completed 30
years of service, whichever comes first.
Rivera completed 30 years of service and
UNILAB retired her pursuant to the terms of
the plan, she received the benefits in '88.At
Rivera's request, UNILAB allowed her to
continue working for the company. She
continued working beyond the compulsory
separation from service that resulted from
her retirement. From 1993 to 1994, Rivera
served as a personal consultant under
contract for UNILAB's sister companies
which assigned Rivera to render service
involving UNILAB. In 1992, the company
amended its retirement plan, providing,
among others, for an increase in retirement
benefits. Rivera asked that her retirement
benefits be increased in accordance with
the amended retirement program. Whether
Rivera is entitled to the additional
retirement benefits of the amended
retirement plan?
A: No. Whether these terms included renewed
coverage in the retirement plan is an
evidentiary gap that could have been
conclusively shown by evidence of deductions
of contributions to the plan after 1988. Two
indicators, however, tell us that no such
coverage took place. The first is that the terms
of the retirement plan, before and after its
1992 amendment, continued to exclude those
who have rendered 30 years of service or
have reached 60 years of age. Therefore, the
plan could not have covered her. The second
is the absence of evidence of, or of any
demand for, any reimbursement of what
Rivera would have paid as contributions to the
plan had her coverage and deductions
continued after 1988. Thus, the Court
concludes that her renewed service did not
have the benefit of any retirement plan
coverage. (Rivera v. United Laboratories, Inc.,
G.R. No. 155639, April 22, 2009)
Q: Is a special retirement plan different
from those contemplated under the LC as
agreed upon by the parties valid?
A: Yes. A pilot who retires after 20 years of
service or after flying 20,000 hours would still
be in the prime of his life and at the peak of his
career, compared to one who retires at the age
of 60 years old. Based on this peculiar
circumstance that PAL pilots are ip, the parties
UNIVERSITY OF SANTO TOM.A~ .!.185
l F acuftaa ae (] )er ecl i o Cun(
LABOR RELATIONS: TERMINATION OF EMPLOYMENT: ByEMPLOYEE
provided for a special scheme of retirement
different from that contemplated in the LC.
Conversely, the provisions of Art. 287 of the
LC could not have contemplated the situation
of PAL's pilots. Rather, it was intended for
those who have no more plans of employment
after retirement, and are thus in need of
financial assistance and reward for the years
that they have rendered service. (PAL v.
Airline Pilots Ass'n of the Pnils., G.R. No.
143686, Jan. 15, 2002)
Q: In '55, Hilaria was hired as a grade
school teacher at the Sta. Catalina
College. In '70, she applied for and was
granted a 1yr LOA without pay due to the
illness of hermother. After the expiration in
'71 of her LOA, she had not been heard
fromby Sta. Catalina.Inthe meantime, she
was employed as a teacher at the San
Pedro Parochial School during SY '80-'81
and at the Liceo de San Pedro, during SY
'81-'82. In '82, she applied anew at Sta.
Catalina which hired her. On Mar 22, '97,
during the 51
st
Commencement Exercises
of Sta. Catalina, Hilaria was awarded a
Plaqueof Appreciationfor 30 yrs of service
and P12,OOO as gratuity pay. On May 31,
'97, Hilaria reached the compulsory
retirement ageof 65. Sta. Catalina pegged
her retirement benefits at
P59,038.35. Deducted was the amount of
P12,OOO representing the gratuity pay
which was givento her.
Should the gratuity pay be deducted from
the retirementbenefits?
A: No. As for the ruling of the CA affirming that
of the NLRC that the P12,OOO gratuity pay
earlier awarded to Hilaria should not be
deducted from the retirement benefits due her,
the same is in order. Gratuity pay is separate
and distinct from retirement benefits. It is paid
purely out of generosity.
186
Q: What is the difference betweengratuity
payandretirementbenefits?
A:
:' _ -GRATUITY PAY ,,> RETIREMENT
t- _ " - __ :.,BENEFITS, "
Are intended to help
the Ee enjoy the
remaining years of his
life, releasing himfrom
the burden of worrying
for his financial
support, and are a form
of reward for his loyalty
to the Er. (Ste. Catalina
College and Sr. Loreta
Oranza, vs. NLRC and
Hilaria Tercera, G.R.
No. 144483.
November 19, 2003, J .
Carpio-Morales)
It is paid to the
beneficiary for the past
services or favor
rendered purely out of
the generosity of the
giver or grantor. It is
not intended to pay a
worker for actual
services rendered or
for actual
performance. It is a
money benefit or
bounty given to the
worker, the purpose of
which is to reward Ee's
who have rendered
satisfactory service to
the com an .
, RESIGNATION
Q: Whatis resignation?
A: It is the voluntary act of an Ee who finds
himself in a situation where he believes that
personal relations can be sacrificed in favor of
the exigency of the service, and he has no
other choice but to dissociate himself from his
employment.
Note:The Ee must serve a written notice on the
employer (Er) at least 1month in advance. Once
accepted, it cannot be withdrawn without the
consent of the Er. (lntertrod Maritime Inc. v.
NLRC, G.R. No. 81037, June 19, 1991)
Q: What is the effect if resignation is not
voluntary?
A: It is deemed to be a constructive dismissal.
Q: Noel was hired as a "sales eng'r" at
Avesco Marketing Corp. to supervise and
install sound andcommunications systems
for its clientele. Hetenderedhis resignation
letter after he was asked by the Avesco
Vice-President to resign which he
immediatelyrevoked. A copy of revocation
was received by the company. He was
placed under preventive suspension and
askedto explainwhy nodisciplinary action
should be taken against him. The latter
eventuallyterminated himdueto breachof
trust and confidence arising from selling
competitive products which was inimical to
the interest of the company resulting to
sales loss of the same. Noel filed a
complaint for illegal dismissal. AVESCO
interposed a defense that Noel voluntarily
resigned. Was Noel voluntarily resigned?
A: No. Voluntary resignations being
unconditional in nature, boththe intent and the
ovett act of relinquishment should concur. If
the employer (Er) introduces evidence
purportedly executed by an employee (Ee) as
proof of voluntary resignation yet the Ee
specifically denies such evidence, as in Noel's
case, the Er is burdened to prove the due
execution and genuineness of such evidence.
In)he case at bar, the notice of asking Noel to
explainwhy noadministrative action should be
taken against himnegates Avesco's assertion
of voluntary resignation or separation. For a
resignationtendered by an Ee to take effect, it
shouldfirst be accepted or approvedbythe Er.
AVESCO's receipt of Noel's resignation letter
is not equivalent to approval. (Mora v.
AVESCO Marketing Corp., G.R. No. 177414,
Nov. 14, 2008, J . Carpio-Morales)
Q: Is a resigned employee (Ee) jmtltled to
separation pay?
A:
GR: No.
XPN: Unless otherwise stipulated in the
employment contract or CBA, or the
company policy providesfor it.
Note: Generally, an Ee who voluntarily
resigns from employment is not entitled to
separationpay. Inthe presentcase, however,
upon the request of Ee, Er agreed to a
scheme whereby the former would receive
separation pay despite having resigned
voluntarily. Thus, the terms and conditions
theybothagreeduponconstituteda contract
freely entered into, which should be
performedin goodfaith, as it constitutedthe
lawbetweenthe parties. (Alfaro v. CA, GR.
No. 140812, Aug. 28, 2001)
Q: Ian was employed by PTI as a chief
Investigative writer and then assistant to
the publisher. Ian filed a 30-day leave of
absence effective on the same date, citing
the advice of his personal physician for
him to undergo further medical
consultations abroad. On Oct. 24, 1988, Ian
wrote a "Memorandum for File" addressed
to Bernadette. Construing said memo as a
letter of resignation, Bernadette accepted
said resignation letter of private
respondent. Maya "Memorandum for File"
which did not mention the words "resign"
andlor "resignation" nonetheless juridically
constitutes voluntary resignation?
A: Yes. Notwithstanding the fact that the
memo submitted by Ian to the Bernadette did
not mention the words "resign", Ian's
incendiary words and sarcastic remarks,
negate any desire to improve work relations
with Bernadette and other PTI executives.
Such strongly worded letter constituted an act
of "burning his bridges" with the officers of the
company. Common sense dictates that Ian
meant to resign when he wrote the said
memorandum. (Phils Today, Inc. v. NLRC,
G.R. No. 112965,Jan. 30, 199~
Academics Committee
Vi ce-Chai r j or Admi n &F i nance: Aissa CelineH.Luna
Vi ce-Chai r j or L ayout &Desi gn: Loise RaeG.Naval
-
Labor LawCommittee
Members:
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanel1eC.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
.~ :~.,!,!,,~~ .
Pacu[taa ae CDerecfio Civif
187
DISPUTE SETTLEMENT AND REMEDIES
DISPUTE SETTLEMENT and REMEDIES
Q: What is the concept of tripartism?
Q: What are the alternative modes of
settlement of labor dispute under Art. 211
of the Labor Code?
A:
1. Voluntary Arbitration
2. Conciliation
3. Mediation
Q: What is arbitration?
A: It is the submission of a dispute to an
impartial person for determination on the basis
of evidence and arguments of the parties. The
arbiter's decision or award is enforceable upon
the disputants. It may be voluntary (by
agreement) or compulsory (required by
statutory provision). (Luzon Dev't Bank v.
Ass'n of Luzon Dev't Bank Employees, G.R.
No. 120319, Oct. 6, 1995)
Q: What is conciliation?
A: It is the process where a disinterested 3rd
party meets with management and labor, at
their request or otherwise, during a labor
dispute or in collective bargaining conferences,
and by cooling tempers, aids in reaching an
agreement.
Q: What is mediation?
A: It is when a 3'd party studies each side of
the dispute then makes proposals for the
disputants to consider. The mediator cannot
make an award nor render a decision.
Q: Can the court fix resort to voluntary
arbitration (VA)?
A: Resort to VA dispute, should not be fixed by
the court but by the parties relying on their
strengths and resources.
Q: Who are the parties to labor relations
cases?
A:
1. Employees organization
2. Management
3. The public
Note: Employer and Ees are active parties while
the public and the State are passive parties.
(Poquiz, 2006, p.3)
188
A: It is the representation of 3 sectors. These
are:
1. The public or the government
2. The employers
3. The workers
- in policy-making bodies of the gov'!.
Q: Can workers insist that they be
represented in the policy making in the
company?
A: No. Such kind of representation in the
policy-making bodies of private enterprises is
not ordained, not even by the Constitution.
What is provided for is workers participation in-
policy and decision-making process directly
affecting their rights, benefits, and welfare.
ART. 128. VISITORIAL AND
; ENFORCEMENT POWER
Q: What are the 3 kinds of powers of the
Secretary of Labor and Employment (SLE)?
A:
1. Visitorial powers
2. Enforcement powers
3. Appellate or power to review
Q: What constitute visitorial power?
A:
1. Access to employer's records and
premises at any time of the day or
night, whenever work is being
undertaken
2. To copy from said records
3. Question any employee and
investigate any fact, condition or
matter which may be necessary to
determine violations or which may aid
in the enforcement of the Labor Code
and of any labor law, wage order, or
rules and regulation issued pursuant
thereto.
Q: Give 4 instances where the visitorial
power of the SLE may be exercised under
the Labor Code.
A: 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)
2. Have access to employer's records
and premises to determine violations
of any provisions of the LC on
recruitment and placement. (Arl. 128)
3. Conduct industrial safety inspections
of establishments. (Arl. 165)
4. Inquire into the financial activities of
legitimate labor organizations (LLO)
and examine their books of accounts
upon the filing of the complaint under
oath and duly supported by the
written consent of at leas~20% of the
total membership of the- LO
concerned.
Q: What is enforcement power?
A: It is the power of the SLE to:
1. Issue compliance orders
2. Issue writs of execution for the
enforcement of their orders, except in
cases where the employer (Er)
contests the findings of the labor
officer and raise issues supported by
documentary proof which were not
considered in the courseof 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
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 employees
concerned their salaries in case
the violation is attributable to his
fault. (As amended by RA 7730;
Guico v. Secretary, G.R. No.
131750, Nov. 16, 1998)
Q: What are the violations under Art. 128?
A:
1. Obstruct, impede, delay or otherwise
render ineffective the orders of the
SLE or his authorized representatives
2. Any government employee found
guilty of, or abuse of authority, shall
be subject to administrative
investigation and summary dismissal
from service.
Q: What are the limitations to other
courts?
A: In relation to enforcement orders issued
under Art. 128, no inferior court or entity shall:
1. Issue temporary or permanent
injunction or restraining order or
2. Assume jurisdiction over any case
Q: What are the instances when
enforcement power may not be used?
A:
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
3. If employer contests the finding of the
Labor Regulation Officer and such
contestable issue is not verifiable in
the normal course of inspection
Art. 129.RECOVERY OF WAGES, SIMPLE
MONEY CLAIMS AND OTHER BENEFITS
Q: What is the rule on the recovery of
simple money claims?
A:
1. The aggregate money claim of each
employee (Ee) or househelper (HH)
does not exceed P5,OOO.
2. The claim is presented by an Ee or
person employed in the domestic or
household service or HH.
3. The claim arises from Er-Ee
relationship.
4. The claimant does not seek
reinstatement.
Note: In the absence of any of the ft. requisites, it
is the labor arbiter (LA) who shall have the
jurisdiction over the claims arising from Er-Ee
relations, except claims for Ees compensation,
SSS, Philhealth, and maternity benefits, pursuant
to Art.217 of the Labor Code.
The proceedings before the Regional Office shall
be summary and non-litigious in nature.
Q: What is the adjudicatory power of the
Regional Director (RD)?
A: The RD or any of his duly authorized
hearing officer is empowered through
summary proceeding and after due notice, to
hear and decide cases involving recovery of
wages and other monetary claims and
benefits, including legal interests.
Pacu{ taa ae CDer ecl i o Ci vi C
DISPUTE SETTLEMENT AND REMEDIES
Q: An airline which flies both the
international and domestic routes
requested the SLE to approve the policy
that all female flight attendants upon
reaching age 40 with at least 15 years of
service shall be compulsorily retired;
however, flight attendants who have
reached age 40 but have not worked for 15
years will be allowed to continue working in
order to qualify for retirement benefits, but
in no case will the extension exceed 4
years. Does the SLE have the authority to
approve the policy?
A: Yes. Art.132 (d) of the Labor Code provides
that the SLE shall establish standards that will
ensure the safety and health of women
employees including the authority to determine
appropriate minimum age and other standards
for retirement or termination in special
occupations such as those of flight attendants
and the like. (1998 Bar Question)
Q: What is the difference between the power of Secretary of Labor and Employment (SLE),
Regional Director (RD) and Labor Arbiter (LA)?
A:
Art. 128
Art. 129 Art. 217(a)(6)
~ VP and EP of SLE RD LA
Inspection of establishments
and issuance of orders to
Adjudication of Ees claims for wages LA exercises original and
compel compliance with labor
standards, wage orders and
and benefits exclusive jurisdiction
other labor laws
Enforcement of labor
Limited to monetary claims
All other claims arising from Er-
legislation in general
Ee relations
LA decides case within 30
Proceeding is an offshoot of Initiated bysworn complaints filed by calendar days after submission of
routine inspections any interested party the case bythe parties for
decision
J urisdictional req'ts:
1) All other claims arising from
1) Complaint arises from Er-Ee
Er-Ee relations
relationship
2) Claimant is an Ee or person
2) Including those of persons in
domestic or household service
Nojurisdictional req'ts
employed in domestic or household
service or a HH
3) Complaint does NOT include a
3) Involving an amount exceeding
claimfor reinstatement
P5,000
4) Aggregate money claim of EACH
4) Whether or not accompanied
claimant does not exceed P5,000
with a claim for reinstatement
Appealable to SLE (In case
compliance order is issued by Appealable to NLRC Appealable to NLRC
Regional Office)
190
;. NATIONAL LABOR RELATIONS'-
, COMMISSION
i ART. 213216. NATIONAL LABOR
(' RELATIONS COMMISSION (NLRC)
Q: What is the NLRC?
A: It is an administrative body with quasi-
judicial functions and the principal government
agency that hears and decides labor-
management disputes; attachedte the QOLE
solely for program and policy coordination
only.
Q: How is the powers and functions of the
NLRC allocated?
A:
1. En Banc
a. Promulgating rules and
regulations and governing the
hearings and disposition of cases
before any of its divisions and
regional branches.
b. Formulating policies affecting its
administration and operations.
c. On temporary or emergency
basis, to allow cases within the
jurisdiction of any division to be
heard and decided by any other
division whose docket allows the
additional workload and such
transfer will not expose litigants to
unnecessary additional expense.
2. Division (8Divisions with 3members)
a. Adjudicatory;
b. All other powers, functions and
duties;
c. Exclusive appellate jurisdiction
over cases within their respective
territorial jurisdiction.
Q: Does an individual Commissioner have
adjudicatory power?
Q: What are the two kinds of jurisdiction of
the NLRC?
A:
1. Exclusive Original Jurisdiction
a. Certified labor disputes causing
or likely to cause a strike or
lockout in an industry
indispensable to national
interest, certified to it by the
Secretary of Labor or the
President for compulsory
arbitratiqn
b. Injunction in ordinary labor
disputes to enjoin or restrain any
actual or threatened commission
of any or all prohibited or
unlawful acts or to require the
performance of a particular act in
any labor dispute which, if not
restrained or performed forthwith,
may cause grave or irreparable
damage to any party
c. Injunction in strikes or lockouts
under Art. 264 of the Labor Code
(LC)
d. Contempt cases
2. Exclusive Appellate Jurisdiction
a. All cases decided by the Labor
Arbiters under Art. 217(b) of the
LC and Sec. 10 of R.A.8042
(Migrant Worker's Act); and
b. Cases decided by the Regional
Offices of DOLE in the exercise
of its adjudicatory function under
Art.129 of the LC over monetary
claims of workers amounting to
not more than P5000 and not
accompanied by claim for
reinstatement.
Q: What is the composition of the NLRC?
A:
1. Chairman
2. 23 Members
a. 8 members each, shall be chosen
only from among the nominees of
the workers and employers (Er)
organization respectively.
b. The Chairman and the 7
remaining members shall come
from the public sector, with the
latter to be chosen preferably
from among the incumbent Labor
Arbiters.
c. Upon assumption into office, the
members nominated by the
workers and Ers organization
shall divest themselves of any
affiliation with or .interest in the
Pacu{ taa ae < Der ecl i o CiviC ." r
A: No. The law lodges the adjudicatory power
on each of the eight divisions, not on the
individual commissioners nor on the whole
commission. The "division" is a legal entity, not
the person who sits in it. Hence, an individual
commissioner has no adjudicatory power,
although of course, he can concur or dissent in
deciding a case.
DISPUTE SETTLEMENT AND REMEDIES: THE NLRC
federation or association to which
they belong.
management relations
Note: There is no needfor the Commissionon
Appointments to confirm the positions in the
NLRC. Such requirement has no constitutional
basis. (Calderon v. Carale, GR. No. 91636,April
23, 1992)
Q: Howdoes the NLRC adjudicate cases?
A:
1. The NLRC adjudicates cases by
division. A concurrence of 2 votes is
neededfor a validjudgment.
Note: Whenever the required
membershipina divisionis notcomplete
and the concurrence of the
Commissionersto arrive at judgmentor
resolution cannot be obtained, the
Chairmanshall desiqnatesuch number
of additional Commissioners from the
otherdivisionsas maybenecessary.
2. It shall be mandatory for the division
to meetfor purposes of consultation.
Note: The conclusionof a division on
any case submitted to it for decision
shouldbereachedinconsultationbefore
thecaseis assignedtoa memberforthe
writingof theopinion.
3. A certification that a consultation has
been conducted, signed by the
presiding commissioner of the
division, shall be issued (copy
attached to the record of case and
serveduponthe parties).
Q: What are the qualifications of the
Chairman and the Commissioners?
A:
1. Memberof the Philippine Bar
2. Engaged in the practice of law in the
Philippines for at least 15years
3. At least 5 years experience or
exposure in handling labor
management relations
4. Preferably a resident of the region
where he is toholdoffice
Q: What are the qualifications of an
Executive Labor Arbiter?
A:
1. Memberof the Philippine Bar
2. Engaged in the practice of law in the
Philippinesfor at least 10years
3. At least 5 years experience or
exposure in handling labor
192
Q: What is the term of office of the
Chairman, Commissioners and Labor
Arbiters (LAs)?
A: They shall hold office during good behavior
until they reach the age of 65 unless removed
for causes as provided by law or become
incapacltated to discharge the function of his
office.
Provided, however, that the President of the
Philippines may extend the services of the
Commissioners and LAs up to the maximum
age of 70 years upon the recommendation of
the Commissionen bane.
Q: Some disgruntled members of
Bantay Labor Union filed with the Regional
Office of the DOLE a written complaint
against their union officers for
mismanagement of union funds. The
Regional Director (RD) did not rule in the
complainants" favor. Not satisfied, the
complainants elevated the RD's decision to
the NLRC. The union officers moved to
dismiss on the ground of lack of
jurisdiction. Are the union officers correct?
Why?
A: Yes, the union officers are correct in
claimingthat the NLRC has nojurisdiction over
the appealed ruling of the. RD. in Barles v.
Baonio, G.R. No. 120220, June 16, 1999,the
SC ruled:
"Appellate authority over decisions of the RD
involving examination of union accounts is
expressly conferred on the Bureau of Labor
Relations (BLR) under the Rule of Procedure
on Mediation- Arbitration."
Sec. 4. Jurisdiction of the BLR - (b) The BLR
shall exercise appellate jurisdiction over all
cases originating from the RD involving
complaints for examination of union books of
accounts.
The language of the law is categorical. Any
additional explanation on the matter is
superfluous."(2001Bar Question)
Q: Company "A" and Union "B" could not
resolve their negotiations for a new CBA.
After conciliation proceedings before the
NCMB proved futile, B went on strike.
Violence during the strike prompted A to
file charges against striker-members of B
for their illegal acts. The SLE assumed
jurisdiction, referred the strike to the
NLRC and issued a return-to-work order.
The NLRC directed the parties to
submit their respective position papers
and documentary evidence. At the initial
hearing before the NLRC, the parties
agreed to submit the case for resolution
after the submission of the position
papers and evidence.
SLibsequently, the NLRC issued an arbitral
award resolving the disputed provisions of
the CBA and ordered the dismissal of
certain strikers for having knowingly
committed illegal acts during $the strike.
The dismissed employees elevated "their
dismissal to the CA claiming that they
were deprived of their right to due process
and that the affidavits submitted by A
were 'self-serving and of no probative
value. Should the appeal prosper? State the
reason(s) for your answer clearly.
A: The appeal should not prosper. The SC, in
many cases, has ruledthat decisions made by
the NLRC may be basedon position papers. In
the question, it is statedthat the parties agreed
to submit the case for resolution after the
submission of position papers and evidence.
Given this fact, the striker-members of B
cannot now complain that they were denied
due process. They are in estoppel. After
voluntarily submitting a case and encountering
an adverse decision on the merits, it is too late
for the loser to question the jurisdiction or
power of the court. A party cannot adopt a
posture of double dealing. (Marquez vs.
Secretary of Labor, G.R. No. 80685, March 16,
1989). (2001 Bar Question)
Q: Is judicial review of the NLRC's decision
available?
A: Yes, through petitions for certiorari (Rule
65) which should be initiallyfiled withthe CA in
strict observance of the doctrine on the
hierarchy of courts as the appropriate forum
for the relief desired. The CA is procedurally
equipped to resolve unclear or ambiguous
factual finding, aside from the increased
number of its component divisions. (Sf. Martin
Funeral Home v. NLRC, G.R. No. 130866,
Sep. 16, 1998)
Q: Is barangay conctllatlon available in
labor cases?
A: No. Labor cases are not subject to
barangay Conciliation since ordinary rules of
procedure are merely suppletory in character
vis-a-vis labor disputes which are primarily
governed by labor laws. (Montoya v. Escayo,
G.R. No. 82211-12, Mar. 21, 1989)
ART. 217. J URISDICTION OF LABOR
ARBITERS AND THE NATIONAL LABOR
RELATIONS-COMMISSION
Q: What is the distinction between the
jurisdiction of the labor arbiter (LA) and the
National Labor Relations Commission
(NLRC)?
A:
1. The NLRC has exclusive appellate
jurisdiction on all cases decided by
the LA.
2. The NLRC does not have original
jurisdiction on the cases over which
the LA have original and exclusive
jurisdiction.
3. The NLRC cannot have appellate
jurisdiction if a claim does not fall
within the exclusive original
jurisdiction of the LA.
Q: What is the nature of jurisdiction of
labor arbiters (LAs)?
A: It is original and exclusive. LAs have no
appellatejurisdiction.
Q: What are the cases falling under the
jurisdiction of labor arbiters (LAs)?
A: Exclusive and original jurisdiction to hear
and decide the following cases involving all
workers:
1. ULP cases
2. Termination disputes
3. If accompanied with a claim for
reinstatement, those that workers file
involving wages, rates of pay, hours
of work and other terms and
4. Claims for actual, moral, exemplary
and other forms of damages arising
fromEr-Ee relations
5. Cases arising from any violation of
Art. 264, includingquestions involving
the legality of strikes andlockouts;
6. Except claims for Employment
Compensation, Social Security,
Philhealth and maternity benefits, all
other claims arislnq from Er-Ee
relations, including those of persons
in domestic or household service,
involving an amount exceeding
P5000 regardless of whether
accompanied with a claim for
reinstatement
7. Monetary claims of overseas contract
workers arising from Er-Ee relations
under the Migrant Worker's Act of
1995as amendedby RA 10022
UNIVERSITY OF SANTO TOMAS ~,~-: l 193
PacuCtaa de < Der ecno Ci vi C -."
8. Wage distortion disputes in
unorganized establishments not
voluntarily settled by the parties
pursuantto RA 6727
9. Enforcement of compromise
agreements when there is non-
compliance by any of the parties
pursuant to Art. 227 of the Labor
Code (LC); as amended; and
10. Other cases as may be provided by
law
Note: Althoughthe provisionspeaksof exclusive
and original jurisdiction of LAs, the cases
enumerated may instead be submitted to a
voluntaryarbitratorby agreementof the parties
under Art. 262 of the LC. The law prefers
voluntaryovercompulsoryarbitration.
Q: What is the nature of the cases which
the labor arbiter(LA) mayresolve?
A: The cases that a LA can hear and decide
are employment related. Where no Er-Ee
relationship exists between the parties and no
issue is involved which may be resolved by
reference to the LC, other labor statutes, or
any collective bargaining agreement, it is the
RTC that has jurisdiction. (Lapanday
Agncuftural Dev't. Corp v. CA, G.R. No.
112139, Jan.31, 2000)
The LA has jurisdiction over controversies
involving Ers and Ees only if there is a
"reasonable causal connection" between the
claimasserted andthe Er-Ee relations. Absent
such link, the complaint is cognizable by the
regular court. (Eviota v. CA, G.R. No. 152121,
July 29, 2003)
Q: Do labor arbiters exercise concurrent
jurisdiction with the NLRC?
A: Yes, with respectto contempt cases.
Q: Whatarethe cases referredto grievance
machineryandvoluntary arbitration?
A: Disputes arisingfromthe:
1. Interpretation or implementation of
the CSA
2. Interpretation or enforcement of
company personnel policies
Q: What is the extent of the jurisdiction of
the labor arbiter (LA) If there are
unresolved matters arising from the
interpretationof the CBA? .
A:
GR: LAs have no jurisdiction over
unresolved or unsettled grievances arising
194
fromthe interpretation or implementationof
the CSA and those arising from the
interpretation or enforcement of company
personnel policies.
XPN:Actual termination disputes
Note: Where the dispute is just in the
interpretation, implementation or enforcement
stageof thetermination,it maybereferredtothe
grievancemachineryset up by the CSA or by
voluntary arbitration. Where there was already
actual termination, i.e., violation of rights, it is
alreadycognizablebythe LA. (Maneja v. NLRC,
G.R.No. 124013, June 5, 1998)
Q: Does the use of the word "may" in the'
.provisions of the Grievance Procedure
allowthe alternative of submitting the case
beforethe labor arbiter (LA)?
A: Yes. The use of the word "may" shows the
intention of the parties to reserve the right to
submit the illegal termination dispute to the
jurisdiction of the LA, ratherthan to a voluntary
arbitrator. Petitioner validly exercised his
option tosubmit his case to a LA when hefiled
his complaint before the proper government
agency. In other words, the CA is correct in
holding that voluntary abitration is mandatory
in character if there is a specific agreement
between the parties to that effect. It must be
stressed however that, in the case at bar, the
use of the word "may" shows the intention of
the parties to reserve the right of recourse to
LAs. (Vivero v. CA, G.R. No. 138938, Oct. 24,
2000)
Q: What are the cases which do not fall
under the jurisdiction of the labor arbiters
(LA)?
A: LAs havenojurisdiction overthe ff:
1. Foreign governments (JUSMAG-
Phils. v. NLRC, G.R. No. 108813,
Dec. 15, 1994)
2. Int'l agencies (Lasco v. NLRC, G.R.
Nos. 109095-109107, Feb. 23, 1995)
3. Intra-corporate disputes which fall
under P.O. 902-A and nowfalls under
the jurisdiction of the regular courts
pursuant to the new Securities
Regulation Code (Nacpi/ v. IBC, G.R.
No. 144767, Mar. 21, 2002)
4. Executing money claims against
government (Dept of Agriculture v.
NLRC, G.R. No. 104269, Nov. 11,
1993)
A: Yes. The subject of litigation is incapable of
pecuniary estimation, exclusively cognizable
by the RTC, pursuant to Sec. 19 (1) of BP Big.
5. Cases involving GOCCs with original
. charters which are governed by civil
service law, rules or regulations (Arl.
IX-B, Sec.2, No.1, 1987 Constitution)
6. Local water district (Tanjay Water
District v. Gabaton, April 17, 1989)
except where NLRC jurisdiction is
invoked (Zamboanga City Water
District v. Buat, G.R. No. 104389,
May 27, 1994)
,:1 ,
7. The aggregate money claim does not
exceed P5000 and without claim for
reinstatement (Rajah Humabon Hotel,
Inc. v. Trajano, G.R. Nos. 100222-23,
Sep.14, 1993)
8. Claim of employee (Ee) for cash prize
under the Innovation Program of the
company, although arising from Er-Ee
relationship, is one requiring
application of general civil law on
contracts which is within the
jurisdiction of the regular courts (SMC
v. NLRC, G.R. No. 80774, May 31,
1988)
9. Cause of action based on quasi-delict
or tort which has no reasonable
connection with any of the claims
enumerated in Art.217 of the LC
(Ocheda v. CA, G.R. No. 85517, Oct.
16, 1992)
10. Complaint arising from violation of
training agreement (Singapore
Airlines v. Pano, G.R. No. L-47739,
June 22, 1983)
Q: FASAP, the sole and exclusive
bargaining representative of the flight
attendants, flight stewards and pursers of
PAL, and respondent PAL entered into a
CSA incorporating the terms and
conditions of their agreementfor the years
'01-'05. Sec. 144, Part A of the CSA
provides that compulsory retirement shall
be 55for females and 60 for males. They
filed an action with the RTC claiming that
the CSA provision is discriminatory and
hence unconstitutional. The RTCissued a
TRO.Theappellatecourt ruledthat the RTC
has no jurisdiction over the case at bar.
Whether RTC has jurisdiction over the
petitioners' action challenging the legality
of the provisions on the compulsory
retirementagecontainedinthe CSA?
129, 13S amended. Being an ordinary civil
action, the same is beyond the jurisdiction of
labor tribunals.
Not every controversy or money claim by an
employee (Ee) against the employer (Er) or
vice-versa is within the exclusive jurisdiction of
the LA. Actions between Ees and Er where the
Er-Ee relationship is merely incidental and the
cause of action precedes from a different
source of obligation is within the exclusive
jurisdiction of the regular court. Here, the Er-
Ee relationship between the parties is merely
incidental and the cause of action ultimately
arose from different sources of obligation, i.e.,
the Constitution and CEDAW. (Halaguena vs,
PAL Incorporated, G.R. No. 172013, Oct. 2,
2009)
Q: Who has the exclusive appellate
jurisdiction overall casesdecidedbyLabor
Arbiters?
A: The NLRC.
Q: Is a motion for reconsideration (MR)of
the NLRC decision required before
cer ti or ar i maybeavailedof?
A: Yes. A MR is required to enable NLRC to
correct its mistakes. If no MR is filed, NLRC's
decision becomes final and executory.
Q: What is the remedyin caseof denial of
the MR?
A: If the motion is denied, the aggrieved party
may file a petition for cerliorari not later than
60 days from notice of the judgment, order or
resolution. In case a motion for reconsideration
or new trial is timely filed, whether such motion
is required or not, the 60 day period shall be
counted from notice of the denial of said
motion. No extension of time to file the petition
shall be granted except for compelling reason
and in no case exceeding 15 days. (Sec. 4,
Rule 65, Rules of Court.)
Q: What is the effect if no service of
summons was made?
A: In the absence of service of summons or a
valid waiver thereof, the hearings and
judgment rendered by the labor arbiter is null
and void.
Q: Whatis compulsoryarbitration?
A: The process of settlement of labor disputes
by a government agency which has the
authority to investigate and make an award
binding on all the parties.
Pacu[taa de iDerecfio Civif
Q: Can the Labor Arbiter (LA) conduct
compulsory arbitration?
A: Yes. Under the Labor Code, it is the LA
who is clothed with the authority to conduct
compulsory arbitration on cases involving
termination disputes [Art. 217, P.O. 442, as
amended). (PAL v. NLRC, G.R. No. 55159,
Dec. 22, 1989)
Q: What are the rules on venue of filing
cases?
A:
1. All cases which the Labor Arbiters
(LAs) have authority to decide may
be filed in the Regional Arbitration
Branch (RAB) having jurisdiction over
the workplace of the complainant
/petitioner.
Note: Workplace is understood to be
the place or locality where the
employee (Ee) is regularly assigned
when the cause of action arose. It shall
include the place where the Ee is
supposed to report back after a
temporary detail, assignment or travel.
In case of field Ees, as well as ambulant
or itinerant workers, their workplace is
where they are"
a. Regularly assigned
b. Supposed to regularly receive their
salaries and wages
c. Receive their work instructions
from
d. Reporting the results of their
assignment to their employers (Er)
2. Where 2 or more RABs have
jurisdiction over the workplace, the
first to acquire jurisdiction shall
exclude others.
3. Improper venue when not objected to
before filing of position papers shall
be deemed waived.
4. Venue may be changed by written
agreement of the parties or when the
NLRC or the LA so orders,upon
motion by the proper party in
meritorious cases.
5. For Overseas Contract Workers
where the complainant resides or
where the principal office of the
respondent Er is located, at the
option of the complainant.
Note: The Rules of Procedure on
Venue is merely permissive, allowing a
different venue when the interest of
substantial justice demands a different
one. (Dayag v. Canizares, GR. No.
124193, Mar. 6, 1998)
196
ART. 218. POWERS OF THE NATIONAL
LABOR RELATIONS COMMISSION (NLRC) _
Q: What are the powers of the NLRC?
A:
1. Rule making power - promulgation of
rules and regulations:
a. Governing disposition of cases
before any of its diviSion/regional
offices.
b. Pertaining to its internal functions
c. As may be necessary to carry
out the purposes of the Labor
Code.
2. Power to issue compulsory processes'
(administer oaths, summon parties,
issue subpoenas)
3: Power to investigate matters and
hear disputes within its jurisdiction
(adjudicatory power - original and
appellate jurisdiction over cases)
4. Contem pt power
5. Ocular Inspection
6. Power to issue injunctions and
restraining orders
Q: What is an injunction or a temporary
restraining order (TRO)?
A: Orders which may require, forbid, or stop
the doing of an act. The power of the NLRC to
enloin or restrain the commission of any or all
prohibited or unlawful acts under Art. 218 of
Labor Code can only be exercised in a labor
disputes.
Note: A restraining order is generally regarded as
an order to maintain the subject of controversy in
status quo until the hearing of an application for a
temporary injunction. (BF Homes v. Reyes, G.R.
No. L-30690 November 19, 1982)
Q: Who may issue a TRO?
A:
1. President (Art.263[g])
2. Secretary of Labor (Art. 263[g])
3. NLRC (Art.218)
Note: Art. 218 of the Labor Code limits the grant
of injunctive power to the "NLRC". The LA is
excluded statutorily. Hence, no NLRC Rules can
grant himthat power.
Q: What is the procedure for the issuance
of restraining orderlinjunction?
A:
1. Filing of a verified petition
2. Hearing after due and personal notice
has been served in such manner as
the Commission shall direct to:
a. All known persons against
whom relief is sought
b. Also the Chief E~cutiv~ or
other public officials of' the
province or city within which the
unlawful acts have been
threatened or commercial
charged with the duty to protect
the complainant's property.
3. Reception at the hearing of the
testimonies of the witnesses with
opportunity for cross-examination, in
support of the allegations of the
complaint made under oath as well as
testimony in opposition thereto.
4. Finding of fact of the Commission to
the effect that:
a. Prohibited or unlawful acts have
been threatened and will be
committed, or have been and will
be continued unless restrained,
but no injunction or TRO shall be
issued on account of any threat,
prohibited or unlawful act, except
against the persons, association
or organization making the threat
or committing the prohibited or
unlawful act or actually
authorizing or ratifying the same
after actual knowledge thereof.
b. The substantial and irreparable
injury to the complainant's
property.
Note: Irreparable Injury -an injury
which cannot be adequately
compensated in damages due to
the nature of the injury itself or the
nature of the right or property
injured or when there exist no
pecuniary standard for the
measurement of damages.
c. That as to each item of relief to
be granted, greater injury will be
inflicted upon the complainant
by the denial of the relief than will
be inflicted upon the defendants
by the granting of the relief.
d. That complainant has no
adequate remedy at law
Note: Adequate remedy - one that
affords relief with reference to the
matter in controversy and which is
appropriate to the particular
circumstances of the case if the
remedy is specitlcally provided by
law. (PAL v. NLRC, GR. No.
120567, Mar. 20, 1998)
e. That public officers charged with
the duty to protect complainant's
property are unable or unwilling
to furnish adequate protection.
5. Posting of a bond.
ART. 221. TECHNICAL RULES NOT
BINDING AND PRIOR RESORT TO
AMICABLE SETTLEMENT
Q: Are technical rules strictly followed in
proceedings before the NLRC and the
Labor Arbiter (LA)?
A: No. Administrative and quasi-judicial bodies
like the NLRC, are not bound by the technical
rules of procedure in the adjudication of cases.
(Ford Phils. Salaried Employees Ass'n v.
NLRC, G.R. No. 75347, Dec. 11, 1987)
Q: Is NLRC precluded from receiving
evidence for the 1st time on appeal?
A: No. It is well-settled that the NLRC is not
precluded from receiving evidence, even for
the first time on appeal, because technical
rules of procedure are not binding in labor
cases.ln fact, labor officials are mandated by
the Labor Code to use every and all
reasonable means to ascertain the facts in
each case speedily and objectively, without
regard to technicalities of law or procedure, all
in the interest of due process. Thus, in Lawin
Security Services v. NLRC and Bristol
Laboratories Ees' Association-DFA v. NLRC,
G.R. No. 118536, June 9, 1997, we held that
even if the evidence was not submitted to the
labor arbiter, the fact that it was duly
introduced on appeal to the NLRC is enough
basis for the latter to be more judicious in
admitting the same, instead of falling back on
the mere technicality that said evidence can no
longer be considered on appeal. Certainly, the
first course of action would be more consistent
with equity and the basic notions of fairness.
(Clarion Printing House, Inc. vs. NLRC, G.R.
No. 148372, June 27, 2005, J. Carpio-
Morales)
UNIVERSITY OF SANTO TOM.A~ \ij,! 197
... . Pdcu(t' ati - ti e (] )er edi o Ci vtC
DISPUTE SETTLEMENT ANDREMEDIES: THE NLRC
Q: How is this rule reconciled with the
requirement of procedural due process?
A: While the rules of evidence prevailing in the
courts of law or equity are not controlling in
proceedings before the NLRC, the evidence
presented before it must at least have a
modicum of admissibility for it to be given
some probative value (Uichico et al. v NLRC,
G.R. No. 121434, June 2, 1997). Not only
must there be some evidence to support a
finding or conclusion, but evidence must be
substantial. Substantial evidence is more than
a mere scintilla. It means such relevant
evidence as a reasonable mind might accept
as adequate to support a conclusion. (Gelmart
industries Inc. v. Leogardo Jr., G.R. No.
70544, Nov. 5, 1987)
Q: Should there always be a formal or trial
type hearing to satisfy the requirements of
due process?
A: No. Formal or trial-type hearing is not at all
times and in all instances essential to due
process, the requirements of which are
satisfied where parties are afforded fair and
reasonable opportunity to explain their side of
the controversy at hand. (Llora Motors Inc. v.
Drilon, GR. No. 82895, Nov. 7, 1989)
Note: Res judicata applies only to judicial or
quasi-judicial proceedings and not to the exercise
of administrative powers.
Q: What is the nature of the proceedings
before the Labor Arbiter (LA)?
A: It shall be non-litigious in nature. Subject to
the requirements of due process, the
technicalities of law and procedure and the
rules obtaining in the courts of law shall not
strictly apply thereto. The LA may avail himself
of all reasonable means to ascertain the facts
of the controversy speedily, including ocular
inspection and examination of well-informed
persons. (Sec. 2, Rule V, NLRC 2005 Rules of
Procedure)
Q: What is the effect of failure of
conciliation and mediation?
A: Should the parties fail to agree upon an
amicable settlement, either in whole or in part,
during the mandatory conciliation and
mediation conference:
1. The LA shall terminate the
conciliation and mediation stage and
proceed to pursue the other purposes
of the said conference as enumerated
in Sec. 3; thereafter,
2. The LA shall direct the parties to
simultaneously file their respective
position papers on the issues agreed
upon by the parties and as reflected
in the minutes of the proceedings.
(Sec. 4, Rule V, NLRC 2005 Rules of
Procedure)
Q: What is the effect of non-appearance of
parties in a conciliation or mediation
proceeding?
A:
1. Complainant/Petitioner - His non-
appearance during the 2 settings for
mandatory conciliation and mediation
conference scheduled in the
summons, despite due notice thereof,
shall be a ground for the dismissal of
the case without prejudice.
2. Respondent
a. His non-appearance during the
first scheduled conference shall
not preclude the second
conference from proceeding as
scheduled in the summons.
b. If he still fails to appear at the
second conference despite being
duly served with summons, the
Labor Arbiter (LA) shall
immediately terminate the
mandatory conciliation and
mediation conference.
c. The LA shall thereafter allow the
complainant or petitioner to file
his verified position paper and
submit evidence in support of his
causes of action, and thereupon
render his declsion on the basis
of the evidence on record. (Sec.
5, Rule V, NLRC 2005 Rules of
Procedure)
Q: What is the concept of amicable
settlement?
A: It is where the Labor Arbiter shall exert all
efforts to arrive at an amicable settlement of a
labor dispute within its jurisdiction on or before
its first hearing or during the mandatory
conferences set for the purpose.
Q: When may the Labor Arbiter (LA)
approve a compromise agreement?
A: It shall be approved by the LA, if:
4. After explaining to the partie-
particularly to the complainants
terms and conditions
consequences thereof
5. He is satisfied that they understand
the agreement
6. That the same was entered into freely
and voluntarily by them
7. That it is not contrary to law, morals,
and public policy.
h" ~ ;'ART. 222::APPEARANCES AND FEES'
Q: Can a non-lawyer appear before the
NlRC or labor Arbiter? ;)
A: Yes. Provided, the non-lawyer:
1. Represents himself as party to the
case;
2. Represents a legitimate labor
organization (LLO) which is a party to
the case provided that he shall be
made to present a verified
certification that he is authorized to
represent the LLO in the said case
3. Represents a member or members of
a LLO that is existing within the
employers establishment
4. Is a duly-accredited member of any
legal aid office recognized by the
DOJ or IBP
5. Is the owner or president of a
corporation or establishment which is
a party to the case. (2005 NLRC
Rules)
Q: What is the amount of attorney's fees
that may be granted? .
A:
1. For simple monetary claims - 10% of
the total monetary award adjudged
the employees excluding the award
for moral and exemplary damages.
(Art. 111)
2. For CBA negotiations and conclusion
- It shall be in the amount agreed
upon by the parties taken from the
union funds and not from individual
union members.
Q: When is payment of attorney's fees
prohibited?
A: Only where the same is effected through
forced contributions from the workers from
their own funds as distinguished from union
funds. Neither the lawyer nor the union may
require the individual workers to assume the
obligation to pay the attorney's fees from their
own pockets. Any agreement to the contrary
shall be null and void.
:. . ART. 223. APPEAL
Q: Where do you appeal the labor Arbiter's
decision?
A: NLRC.
Q: What are the grounds for appeal to the
NlRC?
A:
1. Prima facie evidence of abuse of
discretion on the part of the Labor
Arbiter
2. The decision, order or award was
secured through fraud or coercion,
including graft and corruption
3. Purely questions of law
4. Serious errors in the findings of facts
which would cause grave or
irreparable damage or injury to the
appellant.
Q: Is a motion for reconsideration of labor
Arbiter's decision a precondition to an
appeal to the NLRC?
A: No.
Q: Within what period should the appeal
from Labor Arbiter (LA) be made?
A:
1. Decisions, resolutions or orders of the
LA shall be final and executory unless
appealed to the NLRC by any or bot
parties within 10 calendar days fro
receipt thereof
2. In case of decisions, resolutions
orders of the Regional Director of e
DOLE pursuant to Art. 129 of t e
Labor Code, within 5 calendar da s
from receipt thereof. (2005 Revised
Rules of the NLRC)
Q: The affected members of the rank and
file elevated a Labor Arbiter's decision to
the NlRC via a petition for review filed
after the lapse of the ten-day
reglementary period for perfecting an
appeal. Should the NLRC dismiss the
petition outright or may the NlRC take
cognizance thereof?
A: The NLRC should dismiss the appea
outright because the same was filed beyo d
the reglementary period of appeal. Art. 223
the Labor Code reads: "Decisions, awards,
orders of the LA are final and executor unless
appealed to the Commission by any or both
parties within 10 calendar days from receipt 0
such decisions, awards, or orders. P (2001 Bar
Pacu{ taat{ e CDer ecfto CiviC
DISPUTE SETTLEMENT ANDREMEDIES: THE NLRC
Question)
Q: What does the "10 days" refer to?
A: The shortened period of 10 days fixed by
Art. 223 contemplates calendar days and not
working days. It is precisely in the interest of
labor law that the law has commanded that
labor cases be promptly, if not peremptorily,
disposed of. (Vir-jen Shipping and Marine
Services Inc. v. NLRC, GR. No. L-58011-12,
July 20, 1982)
Note: If the 10th or 5th day, as the case may
be, falls on a Saturday, Sunday or holiday, the
last day to perfectthe appeal shall be the first
working day following such Saturday, Sunday
or holiday.
Q: May the period for filing an appeal be
extended?
A: No. The perfection of an appeal within the
statutory or reglementary period is not only
mandatorybut alsojurisdictional and failure to
do so renders the questioned decision final
andexecutoryas todeprivethe appellate court
of jurisdiction to alter the final judgment of the
Regional Directors and LaborArbiters. (Aboitiz
Shipping Ees Ass'n v. Trajano,. GR. No.
112955, Sep. 1, 1997)
Q: Where is the appeal filed?
A: The appeal shall be filed with the Regional
Arbitration Branch or Regional Office where
the casewas heard and decided. (Sec. 3, Rule
VI, NLRC 2005 Rules of Procedure)
Q: How is an appeal from LA to NLRC
perfected?
A:
1. The appeal is perfected:
a. Filed within the reglementary
period provided in Sec. 1 of this
Rules
b. Verified by the appellant himself
in accordance with Sec. 4, Rule
7 of the Rules of Court, as
amended
c. In the formof a memorandum of
appeal which shall state the
grounds relied upon and the
arguments in support thereof, the
relief prayed for, and with a
statement of the date the
appellant received the appealed
decision, resolutionor order
d. In 3 legibly typewritten or printed
copies
e. Accompanied by (i) proof of
payment of the required appeal
fee; (ii) posting of a cash or
surety bond as provided in Sec.
6 of this Rule; (iii) a certificate of
non-forum shopping; and (iv)
proof of service upon the other
parties.
2. Mere notice of appeal without
complying with the other requisites
aforestated shall not stop the running
of the periodfor perfecting anappeal.
. Q; Is the posting of an appeal bond
required for the perfection of an appeal
from a Labor Arbiter's (LA's) decision
involving monetary award?
A; Yes. In case the decision of the LA or the
Regional Director involves a monetary award,
an appeal by the employer may be perfected
only uponthe posting of a bond. (Sec.6, Rule
Q;What are the forms of the appeal bond?
A: It shall either be inthe formof cash deposit
or surety bond equivalent in amount to the
monetary award, exclusive of damages and
attorney's fees. (Sec. 6, Rule VI, NLRC 2005
Rules of Procedure)
Q: Who may issue a surety bond?
A: It shall be issued by a reputable bonding
company duly accredited by the Commission
or the SC, and shall be accompanied by
original or certifiedtrue copies of:
1. A joint declaration under oath by the
Er, his counsel, and the bonding
company, attesting that the bond
posted is genuine, and shall be in
effect until final disposition of the
case.
2. An indemnity agreement betweenthe
Er-appellantand bondingcompany;
3. Proof of security deposit or collateral
securing the bond: provided, that a
check shall not be considered as an
acceptable security;
4. A certificate of authority from the
InsuranceCommission;
5. Certificate of registration from the
SEC;
6. Certificate of authority to transact
surety business fromthe Office of the
President;
7. Certificate of accreditation and
authorityfromthe SC; and
8. A notarized board resolution or
secretary's certificate from the
bonding company showing its
authorized signatories and their
specimen signatures. (Sec. 6, Rule
Note: The appellant shall furnish the appellee
with a certified true copy of the said surety bond
with all the above-mentioned supporting
documents.
Q: What is the period within which a l:ash
or surety bond shall be valid and effective?
A: From the date of deposit or posting, until
the case is finally decided, resolved or
terminated, or the award satisfied. This
condition shall be deemed incorporated in the
terms and conditions of the surety bond, and
shall be binding on the appellants and the
bonding company. (Sec. 6, Rule VI, NLRC
2005 Rules of Procedure)
Q: What is the effect if the bond is verified
by the NLRC to be irregular or not
genuine?
A: The Commission shall cause the immediate
dismissal of the appeal, and censure or cite in
contempt the responsible parties and their
counsels, or subject them to reasonable fine or
penalty. (Sec.6, Rule VI, NLRC 2005 Rules of
Procedure)
Note: The appellee shall verify the regularity and
genuineness of the bond and immediately report
any irregularity to the NLRC.
Q: May the bond be reduced?
A:
GR: No.
XPN: On meritorious grounds, and only
upon the posting of a bond in a reasonable
amount in relation to the monetary award.
Note: The mere filing of a motion to reduce bond
without complying with the requisites in the
preceding paragraphs shall not stop the running
of the period to perfect an appeal (Sec. 6, Rule
VI, NLRC 2005 Rules of Procedure).
Q: Company "A", within the reglementary
period, appealed the decision of a Labor
Arbiter directing the reinstatement of an
Ee and awarding backwages. However,
A's cash bond was filed beyond the ten
day period. Should the NLRC entertain
the appeal? Why?
appeal, as the same was not perfected for
failure to file a bond. In ABA vs. NLRC, GR
No. 122627, July 18, 1999, the SC ruled: "A
appeal bond is necessary ...the appeal may
be perfected only upon the posting of cash or
surety bond issued by a reputable bonding
company duly accredited by the Commission
in the amount equivalent to the monetary
award in the judgment appealed from." (2001
Bar Question)
Q: What is the effect of perfection of an
appeal on execution?
A: The perfection of an appeal shall stay the
execution of the decision of the Labor Arbiter
on appeal, except execution for reinstatement
pending appeal.
Note: The provision of Art. 223 is clear that an
award by the LA for reinstatement shall be
immediately executory even pending appeal and
the posting of a bond by the employer shall not
stay the execution for reinstatement. (Pioneer
Texturizing Corp. VS. NLRC, G.R. No. 118651,
Oct.16, 1997)
Q: May dismissed employees (Ees) collect
their wages during the period between the
Labor Arbiter's (LA's) order of
reinstatement pending appeal and the
NLRC decision overturning that of the LA?
A: Yes. Par. 3 of Art. 223 of the Labor Code
provides that the decision of the LA reinstating
a dismissed or separated Ee, insofar as the
reinstatement aspect is concerned, shall
immediately be executory, pending appeal.
Even if the order of reinstatement of the LA is
reversed on appeal, it is obligatory on ,the part
of the employer (Er) to reinstate and pay the
wages of the dismissed Ee during the period of
appeal until reversal by the higher court. On
the other hand, if the Ee has been reinstated
during the appeal period and such
reinstatement order is reversed with finality,
the Ee is not required to reimburse whatever
salary he received for he is entitled to such,
more so if he actually rendered services during
the period.
Unless there is a restraining order, it is
ministerial upon the LA to implement the order
of reinstatement and it is mandatory on the Er
to comply therewith. (Garcia vs. PAL, GR No.
164856, Jan. 20, 2009)
Q: Is a petition for relief available to the
appellant?
A: Yes.
A: No, the NLRC should not entertain the
UNIVERSITY OF SANTO TOMAS ~>U.U. 201
PacuCtatf de CJ)erecfio Ci ci t ." ,.
Q: Within what period may a petition for
relief maybefiled?
Q: Who are the officials who may issue a
writ of execution?
A: It must befiled WITHIN:
1. 60 days from knowledge of judgment
and
2. 6months fromentryof suchjudgment
Q: Whatarethe applicable rules onjudicial
review?
A:
1. No law allows an appeal from a
decision of the Secretary of Labor or
the NLRC or of a voluntary arbitrator.
2. The way to reviewNLRC decisions is
by special civil action for certiorari,
prohibition or mandamus under Rule
65 of the Rules of Court.
3. J urisdiction belongs to SC and CA,
but in line with the doctrine on
hierarchy of courts, the petition
should be initially presented to the
CA. (St. Martin's Funeral Home v.
NLRC, Sep. 16, 1988).
4. Nomotionfor reconsideration (MR) is
allowed for any order, decision or
award of a LA. However, a MR of a
Labor Arbiter's decision, award or
order which has all the elements of
an appeal may betreated as appeal.
5. Only one MR of the decision, award
or order of the NLRC in cases
appealed before it is allowed.
Q: Will a petition for certiorari stay the
execution of the assailed decision of the
NLRC?
A: No. Unless a TRO is issued by the CA or
SC.
, ART. 224. EXECUTIONOF DECISIONS,
ORDERS OR AWARDS
Q: Whatis awrit of execution?
A: It is an order to carry out or to implement a
final judgment.
Q: Whendoes a decision of the (~LRC, LA,
BLR or Regional Director (RD),Med-arbiter,
Voluntary Arbitrator and SLE) becomefinal
andexecutory?
A: After 10 calendar days from receipt of the
decision by the parties and shall be executory
within 10years.
202
A:
1. SLE
2. Regional Director
3. NLRC
4. LA
5. Med-Arbiter
6. Voluntary Arbitrator
7. Panel of Arbitrators
Q: When may a writ of execution be
issued?
A: It may be issued motu proprio or on motion'
of any interested party within 5years fromthe
date it becomesfinal andexecutory.
An independent action is required for the
execution of the final judgment within the next
5 years. (PNR v. NLRC, G.R. No. 81231, Sep.
19,1989)
Q: May the manner of execution be
appealedfrom?
A:
GR: Once a judgment becomes final and
executory, it can no longer be disturbed,
alteredor modified.
XPN: In cases where, because of
superveningevents, it becomes imperative,
in the higher interest of justice, to direct its
modification in order to harmonize the
disposition with the prevailing
circumstances or whenever it is necessary
to accomplish the aims of justice.
(Galindez, et al. v. Rural Bank of Lianera,
Inc., G.R. No. 84975, July 5, 1989)
The NLRC is vested with authority to look
intothe correctness of the execution of the
decision and to consider supervening
events that may affect such execution.
Where the execution is not in harmonywith
the judgment which gives it life and
exceeds it, it has pro tanto no validity. To
maintain otherwise would be to ignore the
constitutional provision against depriving a
person of his propertywithout due process
of law. (SGS Far East Ltd. v. NLRC, G.R.
No. 123948, Feb. 12, 1998)
Note: Althoughthe decisionof the LaborArbiter
has become final, the correctness of the
executionof thedecisionmaybeappealedtoand
reviewedbytheNLRC.
Q: What are the remedies available to a
third party whose property is being levied
upon in enforcing a decision in a labor
case?
A: The third party may avail himself of
alternative remedies cumulatively, and one will
not preclude the third party from availing
himself of the other alternative remedies in the
event he failed in the remedy first availed of:
1. File a third party claim with the sheriff
of the Labor Arbiter, and
2. If the third party claim ildeniei1, the
third party may appeal the denial to
the NLRC. .
Even if a third party claim was denied, a third
party may still file a proper action with a
competent court to recover ownership of the
property illegally seized by the sheriff.
(Yupangco Cotton Mills v. NLRC, G.R. No.
126322, Jan. 16, 2002)
Q: Canthe RTCissue aninjunction against
the NLRC?
A: Generally, no court has the power to
interfere by injunction with judgments of
another court with concurrent/coordinate
jurisdiction. However, the general rule applies
only when no third-party complaint is involved.
Therefore, if a property under levy does not
belong to the judgment debtor in the NLRC
case, it could not be validly levied upon by the
sheriff for the satisfaction of the judgment
therein. If the third-party claimant does not
involve nor grows out of a labor dispute, a
separate action for injunctive relief against
such levy may be maintained in court. (Co
Tuan et al. v. NLRC, G.R. No. 117232, April
22, 1998)
Academics Committee
Chai r per son: Abraham D, Genuino II
Vi ce-Chai r for .Admi n &F i nance: .AissaCelineH.Luna
Vi ce-Chai r for L ayout &Desi gn: Loise Rae G.Naval
Labor Law Committee
Sl I l ?JectH ead' Lester J ay AlanE.FloresII
Assi stant Sl I l ?JectH ead' Domingo B.Diviva V
Members:
Maria Kristina L Dacayo-Garcia
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelleC.Lee
J emuel PaoloM.Lobo
Andrew W, Montesa
Ur~IVERS!TY OF SANTO TOMAS
Pacu[ tad de r Der ecfi o Ci vi l
A..4l
~. 203
'\(\iJV
DISPUTE SETTLEMENT AND REMEDIES: BUREAU OF LABOR RELATIONS
, BUREAU OF l.ABOR RELATIONS
: ART. 226. BUREAU OF LABOR RELATIONS
: . (BLR). " c
Q: What is covered by the BLR's
jurisdiction and functions?
.
A: The BLR no longer handles "all labor
management disputes"; rather its functions
and jurisdiction are largely confined to:
1. Union matters
2. Collective bargaining registry and
3. Labor education.
Note: J urisdiction over labor management
problems or disputes is also exercised by other
offices:
1.
2.
3.
4.
5.
6.
7.
B.
9.
DOLE Regional Offices
Office of the Secretary of Labor
NLRC
POEA
OWWA
SSS-ECC
RTWPB
NWPC
Regular courts over intra-corporate
disputes.
Q: Who is a mediator-arbiter?
A: An officer in the Regional Office or Bureau
authorized to hear, conciliate and decide
representation cases or assist in the
disposition of intra or inter-union disputes.
Q: What kinds of cases fall within BLR's
jurisdiction?
A: The BLR has original and exclusive
jurisdiction over:
1. Inter-union disputes
2. Intra-union disputes
3. Other related labor relations disputes
Q: What is the coverage of inter/intra-union
disputes?
A: They shall include:
1. Conduct or nullification of election of
union and workers' association
officers
2. Audit!accounts examination of union
or workers' association funds
3. Deregistration of collective bargaining
agreements (CBAs)
4. Validitylinvalidity of union affiliation or
disaffiliation
5. Validity/invalidity of acceptance/ non-
acceptance for union membership
6. Validity/invalidity of voluntary
recognition .
7. Opposition to application for union or
eBA registration
8. Violations of or disagreements over
any provision of the constitution and
by-laws of union or workers'
association
9. Disagreements' over chartering or
registration of labor organizations or
the registration of CBAs;
10. Violations of the rights and conditions
of membership in a union or workers'
association;
11. Violations of the rights of legitimate
labor organizations (LLO), except
interpretation of CBAs;
12. Validity/invalidity of impeachment!
expulSion/suspension or any
disciplinary action meted against any
officer and member, including those
arising from non-compliance with the
reportorial requirements under Rule
V;
13. Such other disputes or conflicts
involving the rights to self-
organization, union membership and
CB-
a. Between and among LLO and
b. Between and among members of
a union or workers' association.
(Sec. 1, Rule XI, Book V, IRR as
amended by D.O. 40-F-03)
Q: What is covered by the phrase "other
related labor relations disputes"?
A:
1. Any conflict between:
a. A labor union and the employer
(Er); or
b. A labor union and a group that is
not a labor organization (LO); or
c. A labor union and an individual
who is not a member of such
union
2. Cancellation of registration of unions
and worker's associations filed by
individual/s other than its members,
or group that is not a LO.
3. A petition for Interpleader involving
labor relations. (Sec. 2, Rule XI, Book
V, IRR as amended by D.O. 40-F-03)
Q: Who may file a complaint or petition
involving intrafinter-unlon disputes?
A: A legitimate labor organization or its
members. (Sec. 5, Rule XI, D.O. 40-03)
Q: What if the issue involves the entire
membership?
A: The complaint must be signed by at least
30% of the entire membership of the union.
Q: What if the issue involves a member
only?
A: Only the affected member may file the
complaint. (Sec. 5, Rule XI, D.O. 40-03)
Note:
GR: Redress must first be sought within the
union itself in accordance with its constitution
and by-laws
XPN:
1. Futility of intra-union remedies;
2. Improper expulsion procedure;
3. Undue delay in appeal as to constitute
substantial injustice;
4. The action is for damages;
5. Lack of jurisdiction of the investigating
body; action for the administrative
agency is patently illegal, arbitrary and
oppressive;
6. Issue is purely a question of law;
7. Where the administrative agency had
already prejudged the case; and
8. Where the administrative agency was
practically given the opportunity to act
on the case but it did not.
Q: May a decision in an inter/intra-union
dispute be appealed from? .
A: Yes.
Q: Within what period mayan appeal to a
decision of the med-arbiter or regional
director in an inter/intra-union dispute be
filed?
A: The decision may be appealed by any of
the parties within 10 days from receipt thereof.
(Sec. 16, Rule XI, D.O. 40-03)
Q: To whom is the decision appealable?
A: The decision is appealable to the:
1. Bureau of Labor Relations (BLR): if
the case originated from the Med-
Arbiter or Regional Director;
2. SLE: if the case originated from the
BLR.
Q: What is the extent of the Bureau of
Labor Relations (BLRs) authority?
A:
1. It may hold a referendum election
among the members of a union for
the purpose of determining whether
or not they desire to be affiliated with
a federation.
2. But the BLR has no authority to:
a. Order a referendum among
union members to decide
whether to expel or suspend
union officers.
b. Forward a case to the Trade
Union Congress of the
Philippines for arbitration and
decision.
Q: Is Katarungang Pambarangay applicable
to labor disputes?
A: No. Art. 226 of the LC grants original and
exclusive jurisdiction over the conciliation and
mediation of disputes grievances or problems
in the regional offices of the DOLE. It is the
Bureau and its divisions (now the NCMB) and
not the Barangay Lupong Tagapamayapa
which are vested by law with original and
exclusive authority to conduct conciliation and
mediation proceedings on labor controversies
before endorsement to the appropriate labor
arbiter for adjudication.
Note: ConCiliation-Mediation is now done by the
NCMB, not Bureau Labor Relations.
Q: What are the administrative functions of
the Bureau Labor Relations (BLR)?
A:
1. Regulation of the labor unions
2. Keeping the registry of labor unions
3. Maintenance of a file of the CBA
4. Maintenance of a file of all
settlements or final decisions of the
SC, CA, NLRC and other agencies on
labor disputes
UNIVERSITY OF SANTO TOMAS ~.! 205
IJ'acu{taa de lDerecfio Ci vi C
DISPUTE SETTLEMENT ANDREMEDIES: BUREAU OF LABOR RELATIONS
Q: What are the effects of filing or
pendency of inter/intra-union dispute and
other labor relations disputes?
A:
1. The rights relationships and
obligations of the party-litigants
against each other and other parties-
in-interest prior tothe institutionof the
petition shall continue to remain
during the pendency of the petition
and until the date of the decision
rendered therein. Thereafter, the
rights, relationships andobligations of
the party-litigants against each other
and other parties-in-interest shall be
governed bythe decision ordered.
2. The filing or pendency of any
inter/intra union disputes is not a
prejudicial question to any petitionfor
certification election, hence it shall
not be a ground for the dismissal of a
petition for certification of election or
suspensionof the proceedings for the
certification of election. (Sec. 3, Rule
XI, DO 40-03)
Q: State the rules on appeal in intra/inter-
union disputes.
A:
1. Formal Requirements
a. Underoath
b. Consist of a memorandum of
appeal.
c. Based on either' of the following
grounds:
i. Grave abuse of discretion
ii. Gross violation of the rules
iii. With supporting arguments
and evidence
2. Period - within 10days fromreceiptof
decision.
3. To whom appealable
a. BLR - if the case originatedfrom
the Med-Arbiter/Regional
Director.
b. SLE - if the case originated from
the BLR.
4. Where Filed - Regional Office or to
the BLR, where the complaint
originated (records are transmitted to
the BLR or Sec. within 24 hours from
the receipt of the memorandum of
appeal). (Rule XI, D. O. 40-03)
206
Academics Committee
Vi ce-Chai r for Academi cs: J eannie A. Laurentino
Vi ce-Chai r for .Admi n &F i nance: Aissa CelineH.Luna
Vi ce-Chai r for L ayout &Destgn: Loise Rae G.Naval
Labor LawCommittee
Members:
Christian NinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelleC.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
r ART. 227. COMPROMISE AGREEMENT
As to repudiation:
A compromise agreement entered
into without the assistance of
UNIVERSiTY OF SANTO TOMAS (~"':~. 207
PacuCtad de < Der echo Ci vi C . -
Q: What is a compromise agreement?
A: It is a contract whereby the parties, by
making reciprocal concessions, avoid litigation
or put an end to one already commenced.
Q: May labor standards violations be
settled by compromise?
A: Yes.
Q: What are the substantial requirements of
a compromise agreement?
A: The compromise agreement must:
1. Be freely entered into
2. Not be contrary to law, morals or
public. policy
3. Be reasonable
4. Be approved by the authority before
whom the case is pending
Q: What are the formal requirements of
compromise agreements involving labor
standards cases? -
A: It must be:
1. Reduced into writing
2. Signed in the presence of the RD or
his duly authorized representative.
Note: Although generally, a compromise, once
approved by final .orders of the court' has the
force of res judicata between the parties and
should not be disturbed except for vices of
consent or forgery. A compromise is basically a
contract perfected by mere consent. Consent is
manifested by the meeting of the offer and the
acceptance upon the thing and the cause which
are to constitute the contract. However, a
compromise agreement is not valid when a party
in the case has not signed the same or when
someone signs for and in behalf of such party
without authority to do so. (Golden Donuts v.
NLRC, G.R. No. 113666-68, Jan. 19,2000)
Q: What is the distinction between a
compromise agreement with assistance of
DOLE and that entered into without
assistance of the same?
A:
1. As to validity and binding effect - the
compromise agreement is valid and
binding upon the parties on both
instances.
2.
a.
DOLE can be repudiated by the
parties by going to the
Commission.
b.
GR: a compromise agreement
entered into with the assistance. of
DOLE can no longer be repudiated,
it becomes final and binding upon
the parties upon execution.
XPN:
i. In case of non-compliance
with the compromise
agreement
ii. If there is prima facie
evidence that the settlement
was obtained through fraud,
misrepresentation, or
coercion.
Q: May ULP cases be subject to
compromise?
A: No.
Note: Dire necessity is not an acceptable ground
for annulling a compromise agreement, especially
since it has not been shown that the employees
had been forced to execute them (Ve/oso v.
DOLE, GR. No. 87297, Aug.S, 1991).
Q: When maya compromise be effected?
A: At any stage of the proceedings and even
when there is already a final and executory
judgment. (Art. 2040, Nee)
.Q: Can the parties enter into a compromise
when the final judgment is already in the
process of execution?
A: No. It cannot be entered into when the final
judgment is already in the process of
execution. (Jesalva, et al. v. Bautista, G.R.
Nos. L-11928-11930, Mar. 24,1959)
Q: What are the options when
compromise agreement is violated?
a
A: Two options:
1. Enforce compromise by writ of
execution; or
2. Regard it as rescinded and insist
upon original demand.
Q: Can there be waiver of reinstatement?
A: Yes. Like waivers of money claims, a
waiver for reinstatement may be regarded as a
personal right which must be exercised
personally by the workers themselves.
DISPUTE SETTLEMENT AND REMEDIES: COMPROMISE AGREEMENTS
Note: Not all waivers and quitclaimsare invalid
as against public policy. If the agreementwas
voluntarily entered into and represents a
reasonablesettlement,it is bindingontheparties
andmaynotlaterbedisownedsimplybecauseof
a changeof mind. It is onlywherethere is clear
proof that the waiver was wangled from an
unsuspectingor gullible person, or the terms of
settlementare unconscionableon its face, that
the law will step in to annul the questionable
transaction.Butwhereit is shownthatthe person
making the waiver did so voluntarily, with full
understandingof what he was doing, and the
considerationfor the quitclaim is credible and
reasonable,the transactionmust be recognized
as a valid and binding undertaking, as in this
case. (Periquet v. NLRC, GR No. 91298, June
22, 1990)
Q: Agoy alleged that he applied for
overseas employment as civil engineer
with private respondent. Agoy was
deployed by Eureka Management to J ubail,
SaUdi, mistakenly under the category of
"Foreman". Agoy, having been accepted by
the Royal Commission to work only as a
"Road Foreman", was later asked by
respondent AI-Khodari to sign a new
contract at a reduced salary rate or suffer
tennination and repatriation. Agoy's refusal
to sign the new contract eventually
resulted in his dismissal from employment.
After being paid the remaining balance of
his salary, Agoy executed a Final
Settlement releasing AI-Khodari from all
claims and liabilities. Agoy was finally
repatriated to Manila. Thereafter, he filed a
complaint for illegal dismissal with claims
for payment of salary for the unexpired
portion of his contract, salary differential
and damages against respondents. Is
Agoy's action barred by the Final
Settlement executed by him?
A: No. In our jurisprudence, quitclaims,
waivers or releases are looked upon with
disfavor, particularly those executed by
employeeswho are inveigledor pressured into
signing them by unscrupulous employers
seeking to evade their legal responsibilities.
The fact that petitioner signed his notice of
termination and failed to make any outright
objection thereto did not altogether mean
voluntariness on his part. Neither did the
execution of a final settlement and receipt of
the amounts agreeduponforeclose his right to
pursue a legitimateclaimfor illegal dismissal.
Moreover, it is noteworthy that petitioner lost
no time in immediately pursuing his claim
against private respondents by filing his
complaint for illegal dismissal a month after
being repatriated on April 2, 1990. This is
203
'-.
hardlyexpectedfrom someone who voluntarily
consented to his dismissal, thus, completely
negating the conclusion that petitioner's
consent was given freely and bolstering the
claim that the same was obtained through
force and intimidation. (Agoy v. NLRC, G.R.
No. 112096, Jan. 30, 1996)
Q: What are the requirements of a valid
quitclaim?
A:
1. The quitclaim must be voluntarily
arrivedat bythe parties
2. It must be:with the assistance of the
BLR or any representative of the.
DOLE
3. The consideration must be
reasonable (required only when
entered without the assistance of
DOLE)
Q: Warlito was a cook aboard the vessel
plying overseas. He filed a complaint for
unpaid money claims and damages against
the manning agency. During the pendency
of the case, Warlito, against the advice of
his counsel, entered into a compromise
agreement with petitioners. He sig'ned a
Quitclaim and Release subscribed and
sworn to before the Labor Arbiter. What is
the effect of the compromise agreement
entered into without the assistance of the
counsel?
A: Art. 227 of the Labor Code provides: Any
compromise settlement, including those'
involving labor standard laws, voluntarily
agreedupon bythe parties with the assistance
of the Dep'tof Labor, shall be final and binding
uponthe parties. The NLRC or any court shall
not assume jurisdiction over issues involved
therein except in case of non-compliance
thereof or if there is prima facie evidence that
the settlement was obtained through fraud,
misrepresentationor coercion.
In the case at bar, that Warlito. was not
assisted by his counsel when he entered into
the compromise does not render it null and
void. All that is requiredfor the compromise to
be deemed volu.ntarilyentered into is personal
and specific individual consent. Contrary to
Warlito's contention, the employees counsel
need not be present at the time of the signing
of the compromise agreement. (J-PHIL
Marine, Inc. VS. NLRC, G.R. No. 175366,
Aug. 11, 2008, J . Carpio-Morales)
Q: Complainants were members of the
KMDD-CFW, a union in the petitioner
company, whose CSA with the corporation
expired. During the freedom period, the
parties were able to agree on the rules
regarding the negotiation. On the date of
the negotiation, petitioner was late, thus
prompting the union panel to walkout.
Petitioner company sent a letter of apology
but the union answered that it was
declaring the negotiation deadlock. Hence,
the union struck. As a result;;) petitipner
company filed a complaint for injunction
and for the dismissal the union officers and
members who participated. In the process,
a compromise agreement was entered into
by the KMDD-CFW and petitioner which
provides that execution of the said
Agreement constitutes a general waiver or
release/quitclaim by them and for payment
of separation pay to the strikers. Is the
compromise agreement entered into by the
union binding to its members?
A: No. Even if a clear majority of the union
members agreed to a settlement with the
employer, the union has no authority to
compromise the individual claims of members
who did not consent to such settlement. In the
case at bar, minority union members did not
authorize the union to compromise their
individual claims. Absent a showing of the
union's special authority to compromise the
individual claims of private respondents for
reinstatement and back wages, there is no
valid waiver of the aforesaid rights.
Thus, money claims due to laborers cannot be
the object of settlement or compromise
effected by a union or counsel without the
specific individual consent of each laborer
concerned. The beneficiaries are the individual
complainants themselves. The union to which
they belong can only assist them but cannot
decide for them. (Go/den Donuts v. NLRC,
G.R. No. 113666-68, Jan. 19,2000)
! ART. 254 NO INJ UNCTION RULE
Q: Can temporary or permanent injunction
or restraining order be issued in any case
involving the growing labor dispute?
A:
GR: No temporary or permanent injunction
Orrestraining order in any case involving or
growing out of labor disputes shall be
issued by any court or other entity.
XPN: Those provided under Art. 218
(Powers of the NLRC) and Art. 264
(Prohibited Activities) of the Labor Code.
Note: Regular courts have no jurisdiction to hear
and decide questions which arise and are
incidental to the enforcement of decisions, orders
or awards rendered in labor cases by appropriate
officers and tribunals of the DOLE. Corollary, any
controversy in the execution of the judgment shall
be referred to the tribunal which issued the writ of
execution since it has the inherent power to
control its own processes in order to enforce its
judgments and orders. (Nova v. Judge Dames,
AM. No. RTJ-00-1S74, Mar. 28, 2001)
Q: What is the rationale for the prohibition
on Injunction?
A: Injunction contradicts the constitutional
preference for voluntary modes of dispute
settlement.
Q: Who are those entities authorized to
issue injunction orders or restraining
orders?
A:
1. NLRC
2. SLE
3. The President
Q: Can the NLRC entertain an action for
injunction even without a complaint for
illegal dismissal filed before the Labor
Arbiter (LA)?
A: No. It is an essential requirement that there
must first be a labor dispute between the
contending parties before the LA. The power
of the NLRC to issue an injunctive writ
originates from " any labor dispute" upon
application by a party thereof, which
application if not granted "may cause grave or
irreparable damage to any party or render
ineffectual any decision in favor of such party."
(PAL v. NLRC, GR No. 120567, Mar.20, 1998)
Note: Labor dispute includes controversy or
matter concerning terms and conditions of
employment, or the association or representation
of persons in negotiating, fixing, maintaining,
changing or arranging the terms and conditions of
employment regardless of whether the disputants
stand in the proximate relation of Er and Ee. (Art.
212[1])
Pacu(taa ae Der echo Ci vi C
~"":'-'.209
''1'
DISPUTE SETTLEMENT AND REMEDIES: COMPROMISE AGREEMENTS
Q: Can regular courts issue injunctions?
A:
GR: Regular courts are without authority to
issue injunction orders in cases involving or
originating from labor disputes even if the
complaint was filed by non-striking
employees and the employer was made a
respondent.
XPN: In cases of strikes/picketing, third
parties or innocent bystanders may secure
a court (regular court) injunction to protect
their rights. (PAFLU v. Claribel, GR. No. L-
25171, Aug. 17, 1967)
Note: The "by-stander" establishment which
is entitled to enjoin a labor strike or picket
must be entirely different from, without any
connection whatsoever to, either party to the
dispute.
210
Academics Committee
Vi ce-Chai r for Academi cs: J eannie i 1.. Laurentino
Labor LawCommittee
Subj ect H ead: Lester J ay AlanE.FloresII
Assi stant Sl I o/ect H ead: Domingo B.Diviva V
Members:
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelleC.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
r ART. 260. GRIEVANCE MACHINERY AND
: VOLUNTARY ARBITRATION
Q: How are cases arising from the
Interpretation or implementation of CBAs
handled and disposed?
A: They are disposed through the grievance
machinery and if not resolved by the grievance
machinery, through voluntary arbitration. (1995
Bar Question)
Q: What is grievance?
.:\
A: It is any question by either the ~~PIOy~r or
the union regarding the interpretation or
implementation of any provision of the CSA or
interpretation or enforcement of company
personnel policies. (Sec. 1 lui, Rule I, Book V,
IRR)
Q: What provrsrons must the parties
include in a CBA?
A:
1. Provisions that will ensure the mutual
observance of its terms and
conditions.
2. A machinery for adjustment and
resolution of grievances arisinq from
the:
a. Interpretation/implementation of
the CSA and
b. Interpretation! enforcement of
company personnel policies. (Art.
260, par. 1).
Q: What is grievance machinery?
A: It refers to the mechanism for the
adjustment and resolution of grievances
arising from the interpretation or enforcement
of company personnel policies. It is part of the
continuing process of collective bargaining
(CS).
Note: It is a must provision in any CBA and no
collective agreement can be registered in the
absence of such procedure.
Q: How is
established?
grievance machinery
A:
1. Agreement by the parties
2. A grievance committee - composed
of at least 2 representatives each
from the members of the bargaining
unit and the employer, unless
otherwise agreed upon by the parties
- shall be created within 10 days from
the signing of CSA
Note: Although Art. 260 of the Labor Code
mentions "parties to a CSA", it does not mean
that a grievance machinery cannot be set up in a
CBA-Iess enterprise. In any workplace where
grievance can arise, a grievance machinery can
be established.
Q: What is grievance procedure?
A: It refers to the internal rules of procedure
established by the parties in their CSA which
usually consists of successive steps starting at
the level of the complainant and his immediate
supervisor and ending, when necessary, at the
level of the top union and company officials
and with voluntary arbitration as the terminal
step.
Q: What will happen to grievances
submitted to the grievance machinery
which are not settled within 7 calendar
days from the date of their submission?
A: They shall automatically be referred to
voluntary arbitration prescribed in the CSA.
(Art. 260, par. 2, Labor Code)
Either party may serve notice upon the other of
its decision to submit the issue to voluntary
arbitration (VA):
1. If the party upon whom such notice is
served fails/refuses to respond within
7 days from receipt, VA/panel
designated in the CSA shall
commence arbitration proceedings
2. If the CSA does not designate or if
the parties failed to name the
VA/panel, the regional branch of
NCMS appoints VA/panel
Q: What is voluntary arbitration?
A: It refers to the mode of settling labor
management disputes by which the parties
select a competent, trained and impartial third
person who shall decide on the merits of the
case and whose decision is final and
executory. (Sec. 1{d}, Rule II, NCMB Revised
Procedural Guidelines in the Conduct of
Voluntary Arbitration Proceedings, Oct. 15,
2004)
Q: What is the difference between
compulsory and voluntary arbitration?
A: Compulsory arbitration is a system whereby
the parties to a dispute are compelled by the
government to forego their right to strike and
are compelled to accept the resolution of their
dispute through arbitration by a 3'd party. The
essence of arbitration remains since a
resolution of a dispute is arrived at by resort to
UNIVERSiTY OF SANTO TOMAS t!" .... 211
fF" acu{taa de Vereclio Civi] ~.
DISPUTE SETTLEMENT ANDREMEDIES:
'GRIEVANCE MACHINERY &VOLUNTARY ARBITRATION
a disinterested third party whose decision is
final and binding on the parties, but in
compulsory arbitration, such a third party is
normally appointed by the government.
Under voluntary arbitration, on the other hand,
referral of a dispute by the parties is made,
pursuant to a voluntary arbitration clause in
.their collective agreement, to an impartial third
person for a final and binding resolution.
Ideally, arbitration awards are supposed to be
complied with by both parties without delay,
such that once an award has been rendered
by an arbitrator, nothing is left to be done by
both parties but to comply with the same. After
all, they are presumed to have freely chosen
arbitration as the mode of settlement for that
particular dispute. Pursuant thereto, they have
chosen a mutually acceptable arbitrator who
shall hear and decide their case. Above all,
they have mutually agreed to be bound by said
arbitrator's decision (Luzon Dev't Bank v.
Ass'n of Luzon Dev't Bank Ees, GR. No.
120319, Oct. 6, 1995)
Q: What is the basis for voluntary
arbitration and its rationale?
A: 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
(Sec. 3, Art. XIII, 1987 Constitution).
Q: Who Is a voluntary arbitrator (VA)?
A:
1. Any person accredited by the NCMB
as such
2. Any person named or designated in
the CSA by the parties to act as their
VA
3. One chosen with or without the
assistance of the NCMS, pursuant to
a selection procedure agreed upon in
the CBA
4. Any official that may be authorized by
the SLE to act as VA upon the written
request and agreement of the parties
to a labor dispute. (Art. 212 (nJ)
Q: What are the powers of a voluntary
arbitrator?
A:
1. Hold hearings
2. Receive evidence
3. Take whatever action necessary to
resolve the dispute including efforts to
212
effect a voluntary settlement between
parties. (Art. 262-A)
Q: How is arbitration initiated?
A:
1. Submission agreement - Where the
parties define the disputes to be
resolved
2. Demand notice - Invoking collective
agreement arbitration clause
Q: How is a voluntary arbitrator (VA)fpanel
chosen?
A:
1. The parties in a CBA shall desiqnate
in advance a VA/panel, preferably
from the listing of qualified VAs duly
accredited by the NCMB, or
2. Include in the agreement a procedure
for the selection of such VA or panel
of VAs, preferably from the listing of
qualified VAs duly accredited by the
NCMB. (Art. 260, par.3)
Q: Who will deSignate the voluntary
arbitrator (VA)/panel in case the parties fail
to select one?
A: It is the NCMB that shall deslqnate the
VA/panel based on the selection procedure
provided by the CBA. (Manila Central Line
Free Workers Union v. Manila Central Line
Corp., G.R. No. 109383, June 15, 1998)
Q: May Labor Arbiters (LA) be deSignated
as voluntary arbitrators (VA)?
A: Yes. There is nothing in the law that
prohibits LAs from also acting as VAs as long
as the parties agree to have him hear and
decide their dispute. (Manila Central Line Free
Workers Union v. Manila Central Line Corp.,
G.R. No. 109383, June 15, 1998)
Note: A VA by the nature of her functions acts i
quasi-judicial capacity. There is no reason .'
the VA's decisions involving interpretation of lav,
should be beyond the SC's review. Administrati e
officials are presumed to act in accordance w .
law and yet the SC will not hesitate to pass up
their work where a question of law is involved o'
where a showing of abuse of authority
discretion in their official acts is properly raised in
petitions for certiorari. (Continental Marble
UNIVERSITY OF SANTO TOMAS ~;;') 213
Pacu{ tad de C] )er ecfzo Ci vi l .~.
r ART.261. J URISDICTION OF VOLUNTARY
i ARBITRATORS OR PANEL OF
VOLUNTARY ARBITRATORS
ART.262. J URISDICTION OVER OTHER
. '. LABOR DISPUTES
Q: What cases are within the jurisdiction of
VA?
A: Original and exclusive jurisdiction over:
1. All unresolved grievances arisinq
from the:
a. Implementation or ~terpr~tation
of the CSA
b. Interpretation or enforcement of
company personnel policies
2. Wage distortion issues arising from
the application of any wage orders in
organized establishments
3. Those arising from interpretation and
implementation of productivity
incentive programs under RA 6971
4. Violations of CBA provisions which
are not gross in character are no
longer treated as ULp'and shall be
resolved as grievances under the
CBA
Note: Gross violation of CSA provisions
shall mean flagrant and/or malicious
refusal to comply with the economic
provisions of such agreement.
5. Any other labor disputes upon
agreement by -the parties including
ULP and bargaining deadlock. (Art.
262)
Q: May the NLRC and DOLE entertain
disputes/grievances/matters under the
exclusive and original jurisdiction of the
voluntary arbitrator?
A: No. They must immediately dispose and
refer the same to the grievance machinery or
voluntary arbitration provided in the CSA
The parties may choose to submit the dispute
to voluntary arbitration proceedings before or
at the stage of compulsory arbitration
proceedings.
Q: What is the effect of the award of
voluntary arbitrator (VA)?
A: The decision or award of the VA acting
within the scope of its authority shall determine
the rights of the parties and their decisions
shall have the same legal effects as judgment
of the courts. Such matters on fact and law a e
conclusive.
Q: Are both the employer and the
bargaining representative of the employees
required to go through the grievance
machinery in case a grievance arises?
A: Yes, because it is but logical, just and
equitable that whoever is aggrieved should
initiate settlement of grievance through the
grievance machinery. To impose compulsory
procedure on employers alone would be
oppressive of capital.
Q: Who has jurisdiction over actual
termination disputes and complaints for
illegal dismissal filed by workers pursuant
to the union security clause?
A: The Labor Arbiter and not the grievance
machinery.
Q: What is the nature of the power of a
voluntary arbitrator?
A: Arbitrators by the nature of their functio s,
act in a quasi-judicial capacity (BP 129, as
amended by R.A. 9702); where a question '
law is involved or there is abuse of discretio
courts will not hesitate to pass upon review
their acts.
Q: Are decisions of voluntary arbitrators
(VAs) appealable?
A:
GR: Decisions of VA are final and execut
after 10 calendar days from receipt of e
copy of the award or decision by the parties.
(Art. 262-A)
XPN:
1.
2.
Appeal to the CA via Rule 43 of e
Rules of Court within 15 days fro
the date of receipt of VA's decisi
(Luzon Dev't Bank v. Ass'n of Luz n
Dev't Bank Ee's, G.R. No. 120319.
Oct. 6, 1995)
If decision of CA is adverse to a
party, appeal to the SC via Rule 45
on pure questions of law.
DISPUTE SETTLEMENT ANDREMEDIES:
GRIEVANCE MACHINERY &VOLUNTARY ARBITRATION
Corporation v. NLRC, G.R. No. L-43825, May 9,
1988)
Q: PSSLU had an existing CBA with Sanyo
Phils., Inc. which contains a union security
clause which provides that: "all members
of the union covered by this agreement
must retain their membership in good
standing in the union as condition of his I
her continued employment with the
company." On account of anti-union
activities, disloyalty and for joining another
union, PSSLU expelled 12 employees (Ees)
from the Union. As a result, PSSLU
recommended the dismissal of said Ees
pursuant to the union security clause.
Sanyo approved the recommendation and
considered the said Ees dismissed.
Thereafter, the dismissed Ees filed with the
Arbitration Branch of the NLRC a complaint
for illegal dismissal.
Does the voluntary arbitrator (VA) have
jurisdiction over the case?
A: No, the VA has no jurisdiction over the
case. Although the dismissal of the Ees
concerned was made pursuant to the union
security clause provided in the CBA, there was
no dispute whatsoever between PSSLU and
Sanyo as regards the interpretation or
implementation of the said union security
clause. Both PSSLU and Sanyo are united and
have come to an agreement regarding the
dismissal of the Ees concerned. Thus there is
no grievance between the union and
management which could be brought to the
grievance machinery. The dispute is between
PSSLU and Sanyo, on the one hand, and the
dismissed union members, on the other hand.
The dispute therefore, does not involve the
interpretation or implementation of a CBA.
(Sanyo Philippines Workers Union-PSSLU v.
Canizares, G.R. No. 101619, July 8, 1992)
Q: X was employed as telephone operator
of Manila Midtown Hotel. She was
dismissed from her employment for
committing the following violations of
offenses subject to disciplinary actions,
namely: falsifying official documents and
culpable carelessness-negligence or failure
to follow specific instructions or
established procedures. X then filed a
complaint for illegal dismissal with the
Arbitration branch of the NLRC. The Hotel
challenged the jurisdiction of the Labor
Arbitrator (LA) on the ground that the case
falls within the jurisdictional ambit of the
grievance procedure and voluntary
arbitration under the CBA.
214
Does the LA have jurisdiction over the
case?
A: Yes, the LA has jurisdiction. The dismissal
of X does not call for the interpretation or
enforcement of company personnel policies
but is a termination dispute which comes
under the jurisdiction of the LA. The dismissal
of X is not an unresolved grievance. Neither
does it pertain to interpretation of company
personnel policy. (Maneja v. NLRC, G.R. No.
124013, June 5, 1998)
Q: Sime Darby Salaried Employees (Ees)
Association-ALU (SDSEA-ALU) wrote
petitioner Sime Darby Pilipinas (SOP)
demanding the implementation of a
performance bonus provision identical to
the one contained in their own CBA with
SOP. Subsequently, SOP called both
respondent SOEA and SOEA-ALU to a
meeting wherein the former explained that
it was unable to grant the performance
bonus. In a conciliation meeting, both
parties agreed to submit their dispute to
voluntary arbitration. Their agreement to
arbitrate stated, among other things, that
they were "submitting the issue of
performance bonus to voluntary
arbitration .
Does the voluntary arbitrator (VA) have the
power to pass upon not only the question
of whether to grant the performance bonus
or not but also to determine the amount
thereof?
A: Yes, in their agreement to arbitrate, the
parties submitted to the VA "the issue of
performance bonus." The language of the
agreement to arbitrate may be seen to be quite
cryptic. There is no indication at all that the
parties to the arbitration agreement regarded
"the issue of performance bonus" as a two-
tiered issue, only one tier of which was being
submitted to arbitration. Possibly, Sime
Darby's counsel considered that issue as
having dual aspects and intended in his own
mind to submit only one of those aspects to
the VA, if he did, however, he failed to reflect
his thinking and intent in the arbitration
agreement. (Sime Darby Phils. v. Magsalin,
G.R. No. 90426, Dec. 15, 1989)
Q: Apalisok, production chief for RPN
Station, was dismissed due to her al/eged
hostile, arrogant, disrespectful, and defiant
behavior towards the Station Manager. She
informed RPN that she is waiving her right
to resolve her case through the grievance
machinery as provided in the CBA. The
voluntary arbitrator (VA) resolved the case
in the employees (Ees) favor.
On appeal, the CA ruled in favor of RPN
because it considered the.
1
waiver of
petitioner to file her complaint"before the
grievance machinery as a relinquishment
of her right to avail herself of the aid of the
VA. The CA said that the waiver had the
effect of resolving an otherwise unresolved
grievance, thus the decision of the VA
should be set aside for lack of jurisdiction.
Is the ruling of the CA correct?
A: No. Art. 262 of the Labor Code provides
that upon agreement of the parties, the VA can
hear and decide all other labor disputes.
Contrary to the finding of the CA, voluntary
arbitration as a mode of settling- the dispute
was not forced upon respondents. Both
parties indeed agreed to submit the issue of
validity of the dismissal of petitioner to the
jurisdiction of the VA by the Submission
Agreement duly signed by their respective
counsels. The VA had jurisdiction over the
parties' controversy.
The Ees waiver of her option to submit her
case to grievance machinery did not amount to
relinquishing her right to avail herself of
voluntary arbitration. (Apa/isok v. RPN, G.R.
No. 138094, May 29, 2003, J . Carpio-Morales)
Academics Committee
Chai r per son: Abraham D. Genuine I.
Vi ce-Chai r far Academi cs: J eannie A. Laurentino
Vi a-Char far Admi n &F i nance: Aissa Celine H. LUrl2
Vi ce-Chai r far L ayout &Desi gn: Loise Rae G. Naval
Labor LawCommittee
Subj ect H ead' Lester J ay Alan E. Flores II
.Assi stant Sl I o/ect H ead' Domingo B. Diviva \-
Members:
Rene Francis P. Batalla
Maria Kristina L. Dacayo-Garcia
Christian Nino A. Diaz
Angelo S.Diokno
Genesis R.Fulgencio
J eanelle C.Lee
J emuel Paolo M.Lobo
Andrew \'1;'.Montesa
UNIVERSITY OF SANTO TOMAS \;;;:/ 215
' F acu[ tad de CDer ecfi o Ci vi l -.-
TRANSITORY AND FINAL PROVISIONS
, TRANSITORY AND FINAL PROVISIONS
Q: What are the penalties provided for in
Art. 288 of the Labor Code?
A:
GR: Any violation of the provisions of the
LC declared to be unlawful or penal in
nature shall be punished with:
1. Fine - Not less than P1, 000.00 nor
more than P10, 000.00; or
2. Imprisonment - Not less 3 months or
more than 3 years, or
3. Both fine and imprisonment at the
discretion of the court.
4. In addition to such penalty, any alien
found guilty shall be summarily
deported upon the completion of
service of sentence.
XPN: As otherwise provided in the LC, or
the acts complained of hinge on a question
of interpretation or implementation of
ambiguous provisions of an existing CBA.
Q: Which court has jurisdiction over any
criminal offense punished under the Labor
Code?
A: It shall be under the concurrent jurisdiction
of the Municipal or City Court and the RTC.
Q: Who are liable when the offenses are
committed by persons other than natural
persons?
A: If the offense is committed by a corporation,
trust, firm, partnership, association, or any
other entity - the penalty is imposed upon the
guilty officer or officers of such corporation,
trust, firm, partnership, association or entity.
Q: Give the rules as regards the
prescriptive period provided for in the
Labor Code (LC).
A:
1. Offenses penalized under the LC - 3
years
2. ULP - one (1) year from accrual of
such ULP; otherwise, forever barred.
(Art. 290);
3. Money claims - 3 years from the time
the cause of action accrued;
otherwise forever barred.
4. All money claims accruing prior to the
effectivity of the LC - within 1 year
216
from the date of effectivity, in
accordance with IRR; otherwise, they
shall be forever barred.
5. Workmen's compensation claims
accruing prior to the effectivity of the
LC and between Nov. 1, 1974 - Dec.
31, 1974 shall be filed not later than
Mar. 31, 1975 before the appropriate
regional offices of the Department of
Labor. (Art. 291)
6. Illegal dismissal cases - 4 years. It
commences to run from the date of
formal dismissal. (Mendoza v. NLRC,
G.R. No. 122481, Mar.5, 1998)
Q: What is the rule on institution of money
claims?
A: Money claims shall be filed before the
appropriate entity independent of the criminal
action that may be instituted in the proper
courts. (Art. 292)
Pending the final determination of money
claims cases filed, no civil action ariSing from
the same cause of action shall be filed with
any court. This provision shall not apply to
employees compensation cases.
& . ......,.~.~:.
Academics Committee
Vi ce-Chai r for Academi cs: ] eannie A.Laurentino
Vi ce-Cbai r for Admi n &F i nance: Aissa CelineH.Luna
Vi ce-Chai r for L ayo: &Desi gn: Loise Rae G.Naval
Labor LawCommittee
Subj ect H ead: Lester] ayAlanE.FloresII
Members:
AngeloS.Diokno
Genesis R.Fulgencio
J eanelle C.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
SOCIAL LEGISLATION
Q: What is Social Legislation?
A: It consists of statutes, regulations and
jurisprudence that afford protection to labor,
especially to working women and minors, and
is in full accord with the constitutional
provisions on the promotion of social justice to
insure the well being and economic security of
all the people.
Q: What is 13
th
month payor its
equivalent?
A: Additional income based on wage required
by P.O. 851 which is equivalent to 1/12 of the
total basic salary earned by an employee (Ee)
within a calendar year.
Q: Who are covered by P.O. 851?
A:
GR: All rank-and-file Ees regardless of the
amount of basic salary that they receive in
a month, if their employers (Er) are not
otherwise exempted from paying the 13
th
month pay. Such Ees are entitled to the
13
th
month pay regardless of said
designation of employment status, and
irrespective of the method by which their
wages are paid.
Provided, that they have worked for at least
1 month, during a calendar year. (Revised
Guidelines on the Implementation of the
13
th
Month Pay Law)
XPN:
1. Government Ees
2. Household helpers
3. Ees paid purely on commission basis
4. Ees already receiving 13
th
month pay
Q: What would be your advice to your
client, a manufacturing company, who asks
for your legal opinion on whether or not the
13th Month Pay Law covers a 'casual Ee
who is paid a daily wage?
A: I will advise the manufacturing company to
pay the casual Ee 13th Month Pay if such
casual Ee has worked for at least 1 month
during a calendar year. The law on the 13th
Month Pay provides that Ees are entitled to the
benefit of said law regardless of their
designation or employment status.
The SC ruled in Jackson Building-
Condominium Corp. v. NLRC, GR. No.
112546, March 13,1996, interpreting P.D.851,
as follows: Ees are entitled to the 13
th
month
pay benefits regardless of their designation
and irrespective of the method by which their
wages are paid. (1998 Bar Question)
Note: An Er, may give to his Ees % of the
required ia" Month pay before the opening of the
regular school yr. and the other half on or before
the Dec. 24.
Q: Is 13
th
Month Pay legally demandable?
A: Yes. It is a statutory obligation, granted to
covered Ees, hence, demandable as a matter
of right. (Sec 1, P.O. 851)
Q: In what form is the 13
th
month pay paid
or given?
A: It is given in the form of:
1. Christmas Bonus
2. Midyear Bonus
3. Profit Sharing Scheme
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.
Q: What are not proper substitutes for 13
th
Month pay?
A:
1. Free rice
2. Electricity
3. Cash and stock dividends
4. COLA (Sec. 3)
Q: Concepcion Textile Co. included the OT
pay, night-shift differential pay, and the like
in the computation of its Ees' 13th-month
pay. Subsequently, with the promulgation
of the decision of the SC in the case of
SMC vs. Inciong (103 SCRA 139) holding
that these other monetary claims should
not be included in the computation of the
13th month pay, Concepcion Textile Co.
sought to recover under the principle of
solutio indebiti the overpayment of the Ees'
13th-month pay, by debiting against future
13th-month payments whatever excess
amounts it had previously made.
(1) Is the Company's action tenable?
(2) With respect to the payment of the 13th-
month pay after the SMC ruling, what
arrangement, if any, must the Company
make in order to exclude from the 13th-
month pay all earnings and remunerations
other than the basic pay?
UNIVERSiTY OF SANTO TOMAS '(~. 217
Pacu{ tad de CDer ecfi o Ci vi l ..
SOCIAL LEGISLATION: 13
TH
MONTH PAY LAw
A: The Company's action is not tenable. The
principle of solutio indebiti which is a civil law
concept is not applicable in labor law. (Davao
Fruits Corp. vs. NLRC, et el., G.R. No. 85073
August 24, 1993). After the 1981 SMC ruling,
the High Court decided the case of Philippine
Duplicators Inc. VS. NLRC, GR 110068, Nov.
11, 1993. Accordingly, management may
undertake to exclude sick leave, vacation
leave, maternity leave, premium pay for
regular holiday, night differential pay and cost
of living allowance. Sales commissions,
however, should be included based on the
settled rule as earlier enunciated in Songco VS.
NLRC, G.R. No. L-50999, March 23, 1990.
(1994 Bar Question)
Q: What is basic salary?
A: Basic salary shall include all remunerations
or earnings paid by an Er to an Ee for services
rendered but may not include:
1. Cost-of-living allowances (COLA)
2. Profit-sharing payments
All allowances and monetary benefits
which are not considered or
integrated as part of the regular or
basic salary of the employee at the
time of the promulgation of P.O. 851
on Dec. 16, 1975. (SMC v. Inciong,
G.R. No. 80774, May 2, 1981)
3. Commissions, if it is not an integral
part of the basic salary (Phlippine
Duplicators, Inc. v. NLRC, GR. No.
109455. November 11, 1993)
Note: However, these salary related benefits (i.e.
cash equivalent of unused vacation and sick
leave credits, OT, premium, night differential and
holiday pay) should be included in the
computation of the 13
th
month pay if by individual
or collective agreement, company practice, or
policy, the same are treated as part of the basic
salary of the Ees.
Salesmen's cornrmssion, comprising a
predetermined percent of the selling price of the
goods by each salesman are not included in the
term "basic salary" for purposes of computing the
13
th
month pay (Philippine Duplicators, Inc. v.
NLRC,[1995]) However, commissions of medical
representatives are not salesmen because they
did not effect any sale of article at all; additional
payments partook of the nature of profit-sharing
bonuses (80ie- Takeda Chemicals, Inc. v. Dela
Serna, G.R. No. 92174, Dec. 10, 1993)
Q: What is commission in relation to 13
th
month pay?
A:
1. The salesman's commissions,
comprising a pre-determined percent
of the selling price of the goods sold
by each salesman, were properly
included in the term basic salary for
purposes of computing their 13
th
month pay.
2. The so called commission paid to or
received by medical representatives
of BoieTakeda Chemicals or by the
rank and file Ees of Phil. Fuji Xerox
were excluded from the term basic
salary because these were paid as
productivity bonuses. Such bonuses
closely resemble profit sharing,
payments and have no clear, direct,
necessary relation to the amount of
work actually done by each individual
employee.
Q: Are all Ers required to pay 13
th
Month
Pay under P.O. 851?
A:
GR: Yes. It applies to all Ers,
XPN:
1. Distressed Ers:
a. Currently incurring substantial
losses or
b. 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 2
years, subject to the provision of
Sec. 7 of P.O. 851;
2. The Government and any of its
political subdivisions, including
GOCCs, except those corporations
operating essentially as private
subsidiaries of the Government;
3. Ers already paying their Ees 13-
month payor more in a calendar year
of its equivalent at the time of this
issuance:
4. Its equivalent shall include:
a. Christmas bonus
b. Mid-year bonus
c. Profit-sharing payments
and
d. Other cash bonuses
amounting to not less
than 1/12th of the basic
salary but
5. It shall not include:
a. cash and stock
dividends,
b. COLA
c. all other allowances
2.
regularly enjoyed by the
Ee, as well as non-
monetary benefits.
4.
~) ::
Ers of household helpers and
persons in the personal service of
another in relation to such workers;
and
5. Ers of those who are paid on purely
commission, boundary, or task basis,
and those who are paid a fixed
amount for performing a specific
work, irrespective of the time
consumed in the performance
thereof, except where the workers are
paid on piece-rate basis in which
case the employer shall be covered
by this issuance insofar as such
workers are concerned.(Sec 3, P.O.
851)
Q: What arethe options of coveredErs?
A:
1. Pay one-half of the 13th-month pay
required before the opening of the
regular school year and the other half
on or before the 24th day of
December of every year.
2. In any establishment where a union
has been recognized or certified as
the collective bargaining agent of the
Ee, the periodicity or frequency of
payment of the 13th month pay may
be the subject of agreement.
Q: Howareclaims adjudicated?
A: Non-payment of the 13
th
month pay
provided by P.O. 851 and the rules of NLRC
shall be treated as money claims cases.
Q: Are the following Ees entitled to ia"
month pay?
a. Eeswho arepaidbyresults
b. Ees with multiple Ers
c. Private school teachers
d. Resignedor separatedEes
A:
1. Ee paid by results - entitled to 13
th
month pay.
Note: Ees paid a fixed or guaranteed
wage plus commission are also entitleo
to the mandated 13
th
month pay, based
on their total earnings during the
calendar year, i.e. on both their fixed 0
guaranteed wage and commission
Those with Multiple Ers
Government Ees working part time i
a private enterprise, including private
educational institutions, as well as
Ees working in 2 or more private
firms, whether full or part time basis,
are entitled to the required ia" month
pay from all their private Ers
regardless of their total earnings from
each or all their Ers.
3. Private School Teachers, including
faculty members of universities and
colleges - entitled regardless of the
number of months they teach or are
paid within a year, if they have
rendered service for at least 1 mont
within a year.
4. Resigned or Separated Ees - I
resigned or separated from wo
before the time of payment of 13
c
'
month pay, entitled to monetary
benefit in proportion to the lengt c'
time he started working during r e
calendar year up to the time '
resignation or termination of service
(Pro-rated 13
th
month pay)
Q: When does pro-ration of 13
th
Month Pay
apply?
A:
GR: Pro-ration of this benefit applies 0 I
in cases of resignation or separation fro
work; computation should be based 0
length of service and not on the actual
wage earned by the worker (Honda Phi/s.
v. Samahan ng Manggagawa sa Honda,
G.R. No. 145561, June 15, 2005)
XPN: Ees who are paid a guaranteed
minimum wage or commissions earned are
entitled to 13
th
month pay based on total
earnings. (Philippine Agricultural
Commercial and Industrial Workers Union
v. N~RC, G.R. No. 107994, Aug. 14, 1995)
Q: Is 14 Month Paylegally demandable?
A: No. The granting of 14th month pay is a
management prerogative and is not legally
demandable. It is basically a bonus and is
gratuitous in nature. (Kamaya Point Hotel v.
NLRC, G.R. No. 75289, Aug. 31, 1989)
UNIVERSITY OF SANTO TOMAS' (~) 219
Pacu{ taa ae (] )er ecno ci ou .~.
SOCIAL LEGISLATION: ANTI-SEXUAL HARRASMENT LAw
r-'~.'~1#31'i.jll!~!3~"If;Wj
Q: What is the policy of the State in
enacting the Anti-Sexual Harassment law?
A: The State shall:
1. Value the dignity of every individual
2. Enhance the development of it
human resources
3. Guarantee full respect for human
rights and
4. Uphold the dignity of workers, Ee,
applicants for employment, students
or those undergoing training,
instruction or education. (Sec. 2)
Q: Who may be held liable for sexual
harassment?
A: In a work, education or training-related
environment sexual harassment may be
committed by an:
1. Ee
2. Manager
3. Supervisor,
4. Agent of the (Er),
5. Teacher, instructor, professor
6. Coach, trainer, or
7. Any other person who, having
authority, influence or moral
ascendancy over another in a work or
training or education environment:
a. Demands
b. Requests or
c. Requires
any sexual favor from the other,
regardless of whether the
demand, request or requirement
for submission is accepted by the
object of R.A. 7877. (Sec. 3)
Q: How is sexual harassment committed?
A: Generally, a person liable demands,
requests, or otherwise requires any sexual
favor from the other, regardless of whether the
demand, request or requirement for
submission is accepted by the latter.
Q: Under the Sexual Harassment Act, does
the definition of sexual harassment require
a categorical demand or request for sexual
favor?
A: No. It is true that the provision calls for a
"demand, request or requirement of a sexual
favor." But it is not necessary that the demand,
request or requirement of a sexual favor be
articulated in a categorical manner. It may be
discerned, with equal certitude, from the acts
of the offender.
220
Likewise, it is not essential that the demand,
request or requirement be made as a condition
for continued employment or for promotion to a
higher position. It is enough that the
respondent's acts result in creating an
intimidating, hostile or offensive environment
for the employee. (Domingo v. Rayala, G.R.
No. 155831, Feb. 18,2008)
Q: When is sexual harassment committed?
A: Specifically:
1. In a work-related or employment
environment:
a. The sexual favor is made as a
condition in the hiring or in the
employment, re-employment or
continued employment of said
individual, or in granting said
individual favorable
compensation, terms, conditions,
promotions, or privileges; or the
refusal to grant the sexual favor
results in limiting, segregating or
classifying the Ee which in a way
would discriminate, deprive or
diminish employment
opportunities or otherwise
adversely affect said Ee;
b. The above acts would impair the
Ees' rights or privileges under
existing labor laws; or
c. The above acts would result in
an intimidating, hostile, or
offensive environment for the Ee.
2. In an education or training
environment:
a. Against one who is under the
care, custody or supervision of
the offender;
b. Against one whose education,
training, apprenticeship or
tutorship is entrusted to the
offender;
c. Sexual favor is made a condition
to the giving of a passing grade,
or the granting of honors and
scholarships, or the payment of a
stipend, allowance or other
benefits, privileges, or
considerations; or
d. Sexual advances result in an
intimidating, hostile or offensive
environment for the student,
trainee or apprentice.
Q; What are the duties of the Er or head of
office in a work-related, education or
training environment?
A;
1. Prevent or deter the commission of
acts of sexual harassment and
2. Provide the procedures for the
resolution, settlement or prosecution
of acts of sexual harassment.
Towards this end, the Er or head of office
shall:
1. Promulgate appropriate rules and
regulations in consultation with the
jointly approved by the Ees or
students or trainees, through their
duly designated representatives,
prescribing the procedure for the
investigation or sexual harassment
cases and the administrative
sanctions therefore. (Sec. 4)
Note; Administrative sanctions shall
not be a bar to prosecution in the
proper courts for unlawful acts of sexual
harassment.
The said rules and regulations issued
shall include, among others, guidelines
on proper decorum in the workplace
and educational or training institutions.
2. Create a committee on decorum and
investigation of cases on. sexual
harassment.
3. The Er or head of office, education or
training institution shall disseminate
or post a copy of this R.A. 7877 for
the information of all concerned
Q; What is the liability of the Er, head of
office, educational or training institution?
A; Ee shall be solidarily liable for damages
arising from the acts of sexual harassment
committed in the employment, education or
training environment provided:
1. The Er or head of office,educational
or training institution is informed of
such acts by the offended party; and
2. No immediate action is taken thereon.
(Sec. 5)
Q: Can an independent action for damages
be filed?
for damages and other affirmative relief. (Sec.
6)
Q; What Is the three-fold liability rule in
sexual harassment cases?
A: An act of sexual harassment may give rise
to civil, criminal and administrative liability on
the part of the offender, each proceeding
independently of the others.
Q: When does the action prescribe?
A: Any action shall prescribe in 3 years.
Q: A Personnel Manager, while interviewing
an attractive female applicant for
employment, stared directly at her for
prolonged periods, albeit in a friendly
manner. After the interview, the manager
accompanied the applicant to the door,
shook her hand and patted her on the
shoulder. He also asked the applicant if he
could invite her for dinner and dancing at
some future time. Did the Personnel
Manager, by the above acts, commit sexual
harassment? Reason.
A: Yes, because the Personnel Manager, is in
a position to grant or not to grant a favor (a
job) to the applicant. Under the Circumstances,
inviting the applicant for dinner or dancing
creates a situation hostile or unfriendly to the
applicant's chances for a job if she turns down
the invitation. [Sec. 3(a)(3), R.A. No. 7877,
Anti-Sexual Harassment Act]. (2000 Bar
Question)
Q: In the course of an interview, another
female applicant inquired from the same
Personnel Manager if she had the physical
attributes required for the position she
applied for. The Personnel Manager
replied: "You will be more attractive if you
will wear micro-mini dresses without the
undergarments that ladies normally wear."
Did the Personnel Manager, by the above
reply, commit an act of sexual harassment?
Reason.
A: Yes. The remarks would result in an
offensive or hostile environment for the Ee.
Moreover, the remarks did not give due regard
to the applicant's feelings and it is a
chauvinistic disdain of her honor, justifying the
finding of sexual harassment (Villarama v.
NLRC, GR. No. 106341, Sep. 2, 1994)
A: Yes. Nothing under R.A. 7877 shall
preclude the victim of work, education or
training-related sexual harassment from
instituting a separate and independent action
UNIVERSITY OF SANTO TOMAS'
Pacu{ tad de Ver ecfzo Ci vi f
SOCIAL LEGISLATION: ANTI-SEXUAL HARRASMENT LAw
Q: Pedrito Masculado, a college graduate
from the province, tried his luck in the city
and landed a job as utility/maintenance
man at the warehouse of a big shopping
mall. After working as a casual Ee for 6
months, he signed a contract for
probationary employment for 6 months.
Being well-built and physically attractive,
his supervisor, ML Hercules Barak, took
special interest to befriend him. When his
probationary period was about to expire, he
was surprised when one afternoon after
working hours, Mr. Barak followed him to
the men's comfort room. After seeing that
no one else was around, Mr. Barak placed
his arm over Pedrito's shoulder and softly
said: "You have great potential to become
a regular Ee and I think I can give you a
favorable recommendation. Can you come
over to my condo unit on Saturday evening
sowe can havea little drink? I'malone, and
I'm sure you want to stay longer with the
company." Is Mr. Barak liable for sexual
harassment committed in a work-related or
employment environment?
A: Yes, the elementsof sexual harassment
are all present. The act of Mr. Barak was
committed in a workplace. Mr. Barak, as
supervisor of Pedrito Masculado, has
authority, influence and moral ascendancy
overMasculado.
Giventhespecificcircumstancesmentionedin
the question like Mr. Barak following
Masculadotothe comfortroom, etc. Mr. Barak
was requestinga sexualfavorfromMasculado
for a favorablerecommendatipnregardingthe
latter's employment.It is not impossiblefor a
male,whois a homosexual,toaskforasexual
favorfromanothermale.(2000BarQuestion)
222
Academics Committee
Vi ce Chai r for Academi cs: J eannie A.Laurentino i
Vi a-Chai r for I qOl l t &Desi gn: Loise RaeG.Naval
Labor LawCommittee
Members:
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelle C.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
Q: How are disputes settled?
Q: What is the policy objective in the
enactment of (SSS) Law?
A: It is the policy of the State to establish,
develop, promote and perfect a sound and
viable tax-exempt SSS suitable to the needs of
the people throughout the Phils., which shall
promote social justice and provid~~meaningful
protection to members and their beneficiaries
against the hazards of disability, sickness,
maternity, old age, death, and other
contingencies resulting in loss of income or
financial burden. (Sec. 2)
The enactment of SSS law is a legitimate
exercise of the police power. It affords
protection to labor and is in full accord with the
constitutional mandate on the promotion of
social justice. (Roman Catholic Archbishop of
Manila v. SSS, G.R. No. 15045 Jan. 20, 1961)
Q: Are the premiums considered as taxes?
A: No. The funds contributed to the System
belong to the members who will receive
benefits, as a matter of right, whenever the
hazards provided by the law occur. (CMS
Estate, lnc., v. SSS, G.R. No. 26298 Sep.28,
1984)
Q: Are benefits received under SSS Law
part of the estate of a member?
A: No. Benefits receivable under the SSS Law
are in the nature of a special privilege or an
arrangement secured by the law pursuant to
the policy of the State to provide social
security to the workingman. The benefits are
specifically declared not transferable and
exempt from tax, legal processes and liens.
(SSS v. Davae, et. st., GR. No.21642, July 30,
1966)
A:
~
DISPUTE SETTtEMENT
Disputes involving:
1. Coverage
2. Benefits
3. Contributions
4. Penalties
5. Any other matter
Social
related thereto.
Security
Note: Disputes within the
Commission mandatory period of 20 days
(SSC) after the submission of evidence.
(See.5a)
Decision, inthe absence of
appeal, shall be final and
executory 15days after date of
notification. (Sec. 5b)
Decisions of SSC shall be
appealable to:
CA/SC
1. CA - questions of lawand fact
(See.5e)
2. SC - questions of law.
(See.5e)
SSC may, motu propria or on
Execution of
motion of any interested party,
decision
issue a writ of execution to
enforce any of its decisions or
awards, after it has become final
and executory. (Sec. 5d)
Q: Can the SSC validly re-evaluate the
findings of the RTC, and on its own,
declare the latter's decision to be bereft of
any basis?
A: No. It cannot review, much less reverse,
decisions rendered by courts of law as it did in
the case at bar when it declared that the CFI
Order was obtained through fraud and
subsequently disregarded the same, making
its own findings with respect to the validity of
Bailon and Alice's marriage on the one hand
.and the invalidity of Bailon and Teresita's
marriage on the other. In interfering with and
passing upon the CFI Order, the SSC virtually
acted as an appellate court. The law does not
give the SSC unfettered discretion to trifle with
orders of regular courts in the exercise of its
authority to determine the beneficiaries of the
SSS. (SSS vs. Teresita Jarque Vda. De
Bailon, G.R. No. 165545, Mar. 24, 2006, J.
Carpio-Morales)
PacuCtaa de (])erecfio CiviC
"4.A) 223
SOCIAL LEGISLATION: SOCIAL SECURITY LAw
Q: Who Is an employer (Er)?
Q: Who are covered by SSS?
A: Any person, natural or juridical, domestic
or foreign, who carries into the Phils. 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: Provided, That a self-
employed person shall be both Ee and Er at
the same time. (Sec 81e))
Q: Who is an employee (Ee)?
A: Any person who performs services for an Er
in which either or both mental and physical
efforts are used and who receives
compensation for such services, where there
is an Er-Ee relationship: Provided, That a self-
employed person shall be both Ee and Er at
the same time. (Sec. 8[d))
Q: What is employment?
A:
GR: Any service performed by an Ee for
his Er.
XPN:
1. Employment purely casual and not
for the purpose of occupation or
business of the Er;
2. Service performed on or in
connection with an alien vessel by an
Ee if he is employed when such
vessel is outside the Phi Is;
3. Service performed in the employ of
the Phil. Government or
instrumentality or agency thereof;
4. Service performed in the employ of a
foreign government or international
organization, or their wholly-owned
instrumentality:
5. Such other services performed by
temporary and other Ees which may
be excluded by regulation of the
SSC. Ees of bona fide independent
contractors shall not be deemed Ees
of the Er engaging the services of
said contractors. (Sec. 80))
Q: What is a contingency?
A:
1. Compulsory Coverage
a. All Ees not over 60 years of age
and their Ers;
b. Domestic helpers whose income
is not less than P 1000/month
and not over 60 years of age and
their Ers;
Limitations:
a. Any benefit earned by the Ees
under private benefit plans
existing at the time of the
approval of the Act shall not be.
discontinued, reduced or
otherwise impaired;
, b. Existing private plans shall be
integrated with the SSS but if the
Er under such plan is
contributing more than what is
required by this Act, he shall pay
to the SSS the amount required
to him, and he shall continue with
his contributions less the amount
paid to SSS;
c. Any changes, adjustments,
modifications, eliminations or
improvements in the benefits of
the remaining private plan after
the integration shall be subject to
agreements between the Ers and
the Ees concerned; and
d. The private benefit plan which
the Er shall continue for his Ees
shall remain under the Ers
management and control unless
there is an exlstinq agreement to
the contrary
c, All self-employed - considered
both an Er and Ee
d. Professionals;
e. Partners and single proprietors of
business;
f. Actors and actresses, directors,
scriptwriters and news
correspondents who do not fall
within the definition of the term
A: The retirement, death, disability, injury or "Ee";
sickness and maternity of the member,
224
g. Professional athletes, coaches,
trainers and jockeys; AND
h. Individual farmers and fisherman.
(Sec. 9)
2. Voluntary
a. Spouses who devote full time to
managing the household and
family affairs, unless they are
also engaged in other vocation or
employment which is subject to
mandatory coverage; (Sec. 9[b])
b. Filipinos recruited by foreign-
based Ers for ~mploy,ment
abroad may be covered by the
SSS on a voluntary basis; (Sec.
9[c))
c. Ee separated from employment
to maintain his right to full
benefits
d. Self-employed who realizes no
income for a certain month
3. ByAgreement
Any foreign government, international
organization, or their wholly-owned
instrumentality employing workers in
the Phils., may enter into an
agreement with the Phil. -government
for the inclusion of such Ees in the
SSS except those already covered by
their respective civil service
retirement systems.
Q: Whoareprimary beneficiaries?
A:
1. The dependent spouse until he or she
remarries
2. The dependent legitimate, legitimated
or legally adopted, and illegitimate
children,: Provided, That the
dependent illegitimate children shall
be entitled to 50% of the share of the
legitimate, legitimated or legally
adopted children.
Q: Whoaresecondary beneficiaries?
A: In the absence of primary beneficiaries, the
dependent parents.
In the absence of all the foregoing, any other
person designated by the member as his or
her secondary beneficiary. (Sec. 8[k])
Q: Whoareconsidered dependents?
A:
1. The legal spouse entitled by law to
receive support from the member;
2. The legitimate, legitimated, or legally
adopted, and illegitimate child who:
a. Is unmarried,
b. Not gainfully employed, and
c. Has not reached 21 years of age,
or if over 21 years of age, he is
congenitally or while still a minor
has been permanently
incapacitated and incapable of
self-support, physically or
mentally.
3. The parent who is receiving regular
support from the member.
Q: What is meant by "dependent for
support"?
A: The entitlement to benefits as a primary
beneficiary requires not only legitimacy but
also dependence upon the member Ee. (Gil v.
SSC et. al. CA- GR SP. 37150 May 8, 1996)
If a wife who is already separated de facto
from her husband cannot be said to be
"dependent for support" upon the husband,
absent any showing to the contrary.
Conversely, if it is proved that the husband
and wife were still living together at the time of
his death, it would be safe to presume that she
was dependent on the husband for support,
unless it is shown that she is capable of
providing for herself. (SSS v. Aguas, G.R. No.
165546, Feb. 27, 2006)
Q: Whois entitled to the benefits of anSSS
member who was survived not only by his
legal wife, who is not dependent upon the
member, but also by two common-law
wives with whom he had illegitimate minor
children?
A: The illegitimate minor children shall be
entitled to the death benefits as primary
beneficiaries because the legal wife is not
dependent upon the member. The SSS Law is
clear that for a minor child to qualify as a
"dependent" the only requirements are that
he/she must be below 21 yrs. of age, not
married nor gainfully employed. (Signey v.
SSS, GR. No. 173582, Jan. 28, 2008)
Q: What is compensation?
A: All actual remuneration for employment,
including the mandated cost of living
allowance, as well as the cash value of any
remuneration paid in any medium other than
cash except that part of the remuneration
received during the month in excess of the
maximum salary.
Pacu{ taa de < Der ecfzo Ci vi C
~.
.. 225
Q: The owners of FALCON Factory, a
companyengaged in the assemblingof
automotive components, decided to have
their building renovated. (50) persons,
composed of engineers, architects and
other construction workers, were hired by
the company for this purpose. The work
was estimatedto becompletedin 3years.
The Ees contended that since the work
would be completed after more than 1
year, they should be subject to
compulsory coverage under the Social
Security Law. Do you agree with their
contention? Explainyour answerfully.
A: No. Under Sec. 8 m of R.A. 1161, as
amended, employmentof purelycasual and not
for the purposeof the occupationor business of
the employer are excepted from compulsory
coverage. An employment is purely casual if it
is notfor the purposeof occupation or business
of the Er.
In the problem given, Falcon Factory is a
company engaged in the assembly of
automotive components. The 50 persons
(engineers, architects and construction
workers) were hired by Falcon Factory to
renovate its building. The work to be performed
bythese 50 people is not in connectionwith the
purpose of the business of the factory. Hence,
the employment of these 50 persons is
purely casual. They are, therefore, excepted
fromthe compulsory coverage of the SSS law.
(2000BarQuestion)
Q: When is the compulsory coverage
deemedeffective?
A:
1. Employer - on the first day of
operation
2. Employee - on the day of his
employment
3. Compulsory
employed -
with the SSS
coverage of self-
upon his registration
Q: What is the effect of separation of an
employee from his employment under
compulsorycoverage?
A:
1. His Ers obligationto contribute arising
from that employment shall cease at
the endof the month of separation,
2. But said Ee shall be credited with all
contributions paid on his behalf and
226
entitled to benefits according to the
provisions of R.A. 9282.
3. Hemay, however, continue to paythe
total contributions tomaintain his right
tofull benefit. (Sec. 11)
Note:The above provision recognizes the " once
a member, always a member" rule.
Q: What is the effect of interruption of
businessor professional income?
A: If the self-employed member realizes no
incomeinanygivenmonth:
1. He shall not be required to pay
contributions for that month.
2'. He may, however, be allowed to
continue paying contributions under
the same rules and regulations
applicable to a separated Ee
member:
3. Provided, that noretroactive payment
of contributions shall be allowedother
than as prescribed under Sec.22-A.
(Sec. 11-A)
Q: What are the benefits under the SSS
Act?
A:
1. Monthly Pension
2. Retirement Benefits
3. DeathBenefits
4. DisabilityBenefits
5. Funeral Benefits
6. Sickness Benefits
7. MaternityBenefits
Q: What is the difference of compensability
under the Labor Law and the Social
Security Law?
A: The claims are different as to their nature
and purpose. (Ortega vs. Social Security
Commission, GR. No. 176150, June 25,2008,
J. Carpio-Morales)
Governs
compensability of :
1. work-related
disabilities
2. when there is
loss of income
due to work-
connected or
work-
A disability is total and
permanent if as a result
of the injury or sickness
the Ee is unable to
perform any gainful
occupation for a
continuous period
exceeding 120 days
regardless of whether
he loses the use of any
of his
to provide insurance or
protection against the
hazards or risks of
disability, sickness, old
age or death, inter alia,
irrespective of whether
they arose from or in
the course of the
employment.
Dis may
permanent total
permanent partial.
Q: What are the reportorial requirements of
the Er and self-employed?
A:
1. Er - Report immediately to SSS the
names, ages, civil status, occupations,
salaries and dependents of all his
covered Ees
2. Self-employed - Report to SSS within
30 days from the first day of his
operation, his name, age, civil status,
occupation, average monthly net
income and his dependents
Monthly Pension
A:
Q: How much is the monthly pension?
1. The monthly pension shall be the
highest of the following amounts:
a. The sum of the following:
i. P300.00; plus
ii. 20% of the average monthly
salary credit; plus
or
iii. 2% of the average monthly
salary credit for each
credited year of service in
excess of 10 years; or
b. 40% of the average monthly
salary credit; or
c. P1,000.00, provided that the
monthly pension shall in no case
be paid for an aggregate amount
of less than sixty (60) months
(Sec. 12(al)
2. Minimum Pension
a. P1,200.00 - members with at
least 10 credited years of service
b. P2,400.00 for those with 20
credited years of service. (Sec.
(bJ)
Retirement Benefit
Q: What is a retirement benefit?
A: It is a cash benefit paid to a member who
can no longer work due to old age.
Q: What are the types of retirement
benefits?
A:
1. Monthly Pension - Lifetime cash
benefit paid to a retiree who has paid
at least 120 monthly contributions to
the SSS prior to the semester of
retirement
2. Lump Sum Amount - Granted to a
retiree who has not paid the required
120 monthly contributions.
Q: Who are entitled for retirement benefits?
A:
1. A member who
a. has paid at least 120 monthly
contributions prior to the semester
of retirement;
b. at least 60 years old; and
c. already separated from
employment or has ceased to be
self-employed, OR
2. At least 65 years old, shall be entitled
for as long as he lives to the monthly
pension; (Sec 12-8 (aJ)
3. A member
a. At least 60 years old at
retirement; and
b. Does not qualify for pension
benefits under paragraph (a)
above - entitled to a lump sum
Pacu(taa de l Der ecfzo Ci vi C .
227
benefit equal to the total
contributions paid by him and on
his behalf;
c. Must be separated from
employment and is not
continuing payment of
contributions to the SSS on his
own. (Sec. 12-8 [bJ)
Q; What happens when the retirement
pensioner is re-employed or resumes self-
employment?
A; The monthly pension of a retirement
pensioner who resumes employment and is
less than 65 years old will be suspended. He
and his Er will again be subject to compulsory
coverage. (Sec. 12-8 [c])
Q; Are the children of a retiree member
entitled to the dependent's pension?
A: Yes (Sec. 12[AJ). However, only 5 minor
children, beginning from the youngest, are
entitled to the dependents' pension. No
substitution is allowed. Where there are more
than 5 legitimate and illegitimate children, the
legitimate ones will be preferred.
Q: For how long will the dependent child
receive the pension?
A: Until the child reaches 21 years of age,
gets married, gets employed and earns P300 a
month or more, or dies.
However, the dependent's pension is granted
for life to children who are over 21 years old,
provided they are incapacitated and incapable
of self-support due to physical or mental defect
which is congenital or acquired during minority.
Q: What will happen to the monthly
pension of a retiree in case of death?
A:
1. Upon the death of the retired
member, his primary beneficiaries as
of the date of his retirement will get
100% of his monthly pension plus the
dependent's pension for each child.
Note: The above phrase "primary
beneficiaries (as of the date of his
retirement )was declared
unconstitutional by the SC in Oycaico v.
SSS and sse (G.R. No. 16137, June 6,
2006) because it is in violation of the
equal protection, due process and
social justice.
2. If he dies within 60 months from the
start of his pension and he has no
primary beneficiaries, his secondary
beneficiaries will receive a lump sum
benefit equivalent to the difference of
60 multiplied by the monthly pension
and the total monthly pensions paid
by the SSS excluding the
dependent's pension. (Sec. 12-8 [dJ)
Q: Bonifacio and Elena are living together
as husband and wife without the benefit of
marriage. Bonifacio declared Elena and
their children as his primary beneficiaries
in his self-employed data record in SSS. A
few months prior to his death, Bonifacio
married Elena.ls: Elena entitled to the
survivor's pension?
A: Yes, she is considered primary beneficiary
of Bonifacio. The phrase "Upon the death of
the retired member, his primary beneficiaries
as of the date of his retirement will get 100 per
cent of his monthly pension xxX:' of Sec. 12-B
d of RA 8282 is unconstitutional because it
violates the: (1) equal protection clause
because it impermissibly discriminates against
dependent spouses whose respective
marriages to the SSS members' were
contracted after the latter's retirement; (2) due
process clause because it outrightly deprives
spouses who married the SSS members after
their retirement of the survivor's pension, a
property interest, without giving them
opportunity to be heard; and (3) social justice.
Further, the survivorship pension applied for
was classified as death benefits. Hence, the
contingency that gives rise to the entitlement
of Elena is the death of Bonifacio and not his
retirement. (Oycaico V. SSS, G. R. No. 16137,
June 6, 2006)
- Death Benefit
Q: When is a beneficiary entitled to death
benefits?
A:
1. Upon death of a member, if he has
paid at least 36 monthly contributions
prior to the semester of death:
a. primary beneficiaries shall be
entitled to the monthly pension;
or
b. If there are no primary
beneficiaries, secondary
beneficiaries shall be entitled to a
lump sum benefit equivalent to
36 times the monthly pension.
2. Upon death of a member If he has
not paid the required 36 monthly
A: The Er shall paythe:
1. Ee for each compensable
confinement or fractionthereof or
2. SSS if member is self-employed
6. daily sickness benefit equivalent
Primary beneficiaries are entitled to to 90% of his average daily
receive monthly pension as of the salary credit, subject to the
date of disability. following conditions:
No primary beneficiaries and he dies a. In no case shall the daily
within 60 months fromthe start of his sickness benefit be paid longer
monthly pension secondary than 120days in 1calendaryear,
beneficiaries shall be entitled to a nor shall any unused portion of
lump sum benefit equivalent to the the 120 days of sickness benefit
total monthly pensions corresponding granted be carried forward and
to the balance of the 5-year added to the total number of
UNIVERSITY OF SANTO TOMAS (~~ 229
Pacu(taa ae CDerecfio CiviC ..
contributions prior to the semester of
death:
a. primary or secondary
beneficiaries shall be entitledtoa
lump sum benefit equivalent to
the monthly pensionmultipliedby
the number of monthly
contributions paidtothe SSS: or
b. 12 times the monthly pension,
whichever is higher. (Sec. 13)
b Permanent Disability Benefit .
Q: What is a disability benefit?
A: It is a cash benefit paid to a member who
becomes permanently disabled, either partially
or totally.
Q: When is the monthly pension and
dependent's pension suspended?
A:
1. Upon the reemployment or
resumptionof self-employment
2. Recovery of the disabled member
fromhis permanent total disability
3. Failure to present himself for
examination at least once a year
upon notice by the SSS. (Sec. 13-A
[bJ)
Q: What is the difference between death
benefits and PTO benefits?
A:
PrimaryBeneficiaries Member
Benefitsshall beinlumpsumequivalenttothe
monthlypensiontimesthenumberof monthly
contributionspaidtoSSS or 12timesthemonthly
pension,whicheveris higher.
Q: What is the effect of the death of ,the
PTO pensioner?
A:
1.
2.
Q: Who will pay sickness benefits? and
how much is the benefit?
guaranteed period excluding the
dependents' pension. (Sec. 13-A [cl)
Q: What is the effect of retirement or death
to partial disability pension?
A: Disability pension shall cease upon his
retirement or death. (Sec 13-A OJ)
" Funeral' Benefit . '.'
Q: What is the funeral benefit?
A: A funeral grant equivalent to P12, 000.00
shall be paid, in cash or in kind, to help defray
the cost of expenses upon the death of a
member or retiree. (Sec. 13-8)
Sickness Benefit
Q: What is sickness benefit?
A: It is a daily cash allowance paid for the
number of days a member is unable to work
dueto sickness or injury.
Q: What are the requirements to be entitled
for sickness benefit?
A:
1. The member paid at least 3 monthly
contributions in the 12-month period
immediately preceding the semester
of sickness or injury;
2. Confined for more than 3 days in a
hospital or elsewhere with the
approval of the SSS;
3. He has used all current companysick
leaves with pay for the current year,
and
4. Notified his Er or the SSS, if he is a
separated, voluntary or self-employed
member.
compensable days allowable in
the subsequent year;
b. Not paid for more than 240 days
on account of the same
confinement; and
c. Ee member shall notify his Er of
the fact of his sickness or injury
within 5 calendar days after the
start of his confinement unless
such confinement:
i. is in a hospital
ii. the Ee became sick or was
injured while working or
within the premises of the Er
(notification to the Er not
necessary);
d. If the member is unemployed or self-
employed, he shall directly notify the
SSS of his confinement within 5
calendar days after the start thereof
unless such confinement is in a
hospital in which case notification is
also not necessary;
e. Where notification is necessary,
confinement shall be deemed to have
started not earlier than the 5th day
immediately preceding the date of
notification. (Sec. 14 [bJ)
Note: The law does not require that sickness
must be related to the duties of the beneficiaries.
Q: When will compensable confinement
commence?
A:
1. Begins on the 1st day of sickness
2. Payment of such allowances shall be
promptly made by the Er:
a. every regular payday or on the
is" and last day of each month,
b. in case of direct payment by the
SSS as long as such
allowances are due and payable.
(Sec. 14[bJ)
Q: What are the requirements in order that
Er may claim reimbursement of the
sickness benefit?
A:
1. 100% of daily benefits shall be
reimbursed by SSS if the following
requirements are satisfied:
a. Receipt of SSS of satisfactory
proof of such payment and
legality thereof:
230
b. The Er has notified the SSS of
the confinement within 5
calendar days after receipt of the
notification from the Ee member:
2. Er shall be reimbursed only for each
da~ of confinement starting from the
10 calendar day immediately
preceding the date of notification to
the SSS if the notification to the SSS
is made beyond 5 calendar days after
receipt of the notification from the Ee
member. (Sec. 14[cl)
Q: When will reimbursement be made by
SSS?
A:
GR: SSS shall reimburse the Er or pay the
unemployed member only for confinement
within 1 year immediately preceding the
date the claim for benefit or reimbursement
is received by the SSS
XPN: Confinement in a hospital in which
case the claim for benefit or reimbursement
must be filed within 1 year from the last day
of confinement. (Sec. 14[c))
.,
~..... ".~iiI.'~
Academics Committee
Vi ce-Chai r for L ayo: &Desi gn: Loise RaeG.Naval
Labor LawCommittee
Members:
ChristianNinoA. Diaz
AngeloS, Diokno
Genesis R.Fulgencio
J eanelle C.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
Q: What is maternity leave benefit?
A: A covered female employee (Ee) is entitled
to a daily maternity benefit equivalent to 100%
of her present basic salary, allowances and
other benefits or the cash equivalent of such
benefits for 60 days or 78 days in case of
caesarian delivery.
Q: What are the requirements in(;Order .that
maternity benefits may be claimed? '.
A:
1. There is childbirth, abortion or
miscarriage; and
2. She has paid at least 3 monthly
contributions
Q: What are the conditions?
A:
1. The Ee shall have notified her
employer (Er) of her pregnancy and
the probable date of her childbirth
which notice shall be tra-nsmitted to
the SSS
2. The payment shall be advanced by
the Er in 2 equal installments within
30 days from the filing of the
maternity leave application
3. In case of caesarian delivery; the Ee
shall be paid the daily maternity
benefit for 78 days
4. Payment of daily maternity benefits
shall be a bar to the recovery of
sickness benefits for the same
compensable period of 60 days for
the same childbirth, abortion, or
miscarriage
5. The maternity benefits provided
under Section 14-A shall be paid
only for the first four deliveries
6. The SSS shall immediately reimburse
the Er of 100% of the amount of
maternity benefits advanced to the Ee
by the Er upon receipt of satisfactory
proof of such payment and legality
thereof; and
previously notified by the Er of the
time of the pregnancy, the Er shall pay
to the SSS damages equivalent to the
benefits which said Ee would
otherwise have been entitled to, and
the SSS shall in turn pay such amount
to the Ee concerned.
. Loan Grant ',;.c' ,
Q: What loans can be granted?
A: Salary loans, educational loans, housing
loan and community hospital loan.
Q: Are the benefits transferable?
A: No. Such benefits are not transferrable and
no power of attorney or other document
executed by those entitled thereto, in favor of
any agent, attorney or any other person for the
collection thereof on their behalf shall be
recognized, except when they are physically
unable to collect personally such benefits.
Q: What is a reserve fund?
A: All revenues of SSS accumulated in a fund
not needed to meet the current administrative
and operations expenses incidental to the
carrying out of R.A. 1161.
Q: What is an investment reserve fund?
A: Such portions of the Reserve Fund as are
not needed to meet the current benefit
obligations thereof.
The Commission through such funds may:
1. Finance housing loans of members;
2. Long-term direct individual or group
housing loans giving priority to the
low-income groups, up to a maximum
of 90% of the appraised value of the
properties to be mortgaged by the
borrowers; and
3. In short and medium-term loans to
members such as salary, educational,
livelihood, marital, calamity and
emergency loans
7. If an Ee should give birth or suffer
abortion or miscarriage without the
required contributions having been
remitted for her by her Er to the SSS,
or without the latter having been
Pacu[ taa de < Der ecno Ci vi C
SOCIAL LEGISLATION: GOVERNMENT SERVICE INSURANCE SYSTEM
Q: What are the purposes behind the
enactment of the GSIS Act?
A: To provide and administer the following
social security benefits for government
employees (Ee):
1. Compulsory life insurance
2. Optional life insurance
3. Retirement benefits
4. Disability benefits to work-related
contingencies; and
5. Death benefits
Q: Who are considered employers (Er)
under the GSIS Act?
A:
1. National Government,
2. Its political subdivisions, branches,
agencies, instrumentalities,
3. GOCCs, and financial institutions with
original charters,
4. Constitutional Commissions and the
J udiciary. (Sec. 2[c])
Q: Can SSS Ees be covered by GSIS?
A: Yes.
Q: Who is an Ee or member?
A: Any person, receiving compensation while
in the service of an Er, whether by election or
appointment, irrespective of status of
appointment, including barangay and
sanggunian officials. (Sec. 2{dJ)
Q: Who are considered dependents?
A:
1. Legitimate spouse dependent for
support upon the member or
pensioner;
2. Legitimate, legitimated, legally
adopted child, including the
illegitimate child,
a. who is unmarried,
b. not gainfully employed,
c. not over the age of majority, or if
over the age of majority,
incapacitated and incapable of
self-support due to a mental or
physical defect acquired prior to
age of majority; and
3. Parents dependent upon the member
for support. (Sec. 2{f])
232
Q: Who are the considered beneficiaries?
A:
1. Primary beneficiaries
a. The legal dependent spouse until
he/she remarries and
b. The dependent children. (Sec.
2[gJ)
2. Secondary beneficiaries
a. The dependent parents and
b. Subject to the restrictions on
dependent children, the
legitimate descendants. (Sec.
2[h]) ,
Q: What is disability? .
A: Any loss or impairment of the normal
functions of the physical and/or mental faculty
of a member, which reduces or eliminates
his/her capacity to continue with his/her
current gainful occupation or engage in any
other gainful occupation.
Q: What is total disability?
A: Complete incapacity to continue with
present employment or engage in any gainful
occupation due to the loss or impairment of the
normal functions of the physical and/or mental
faculties of the member.
Q: What is permanent total disability
(PTD)?
A: Accrues or arises when recovery from
impairment mentioned in Sec.2(q) (defining
disability) is medically remote.
Q: What is temporary total disability (TID)?
A: Accrues or arises when impaired physical
and/or mental faculties can be rehabilitated
and/or restored to their normal functions
Q: What is permanent partial disability
(PPD)?
A: Accrues or arises upon the irrevocable loss
or impairment of certain portions of ,the
physical faculties, despite which the member is
able to pursue a gainful occupation.
Q: What is compensation?
A: The basic payor salary received by an Ee,
pursuant to his or her election or appointment,
excluding per diems, bonuses, OT pay,
honoraria, allowances and any other
emoluments received in addition to the basic
3. Retired Members
a. former active members who
have retired from the service
and are already enjoying the
corresponding retirement
benefits applied for
b. not entitled to any loan
privilege, except stock purchase
loan (Sec. 2.2, Rules II, IRR)
UNIVERSITY OF SANTO TOMAS' ('U~233
PacuCtaa ae Ver ecfi o Ci vi C ' .- .
pay which are not integrated into the basic pay
under existing laws. (Sec. 2[ij)
Q: Baradero is a member of the
Sangguniang Bayan of the Municipality of
La Castellana, Negros Occ. and is paid on a
per diem basis. On the other hand, Belo a
Vice-Governor of Capiz is in a hold over
capaclty and is paid on a per diem basis.
Are the services rendered by Baradero and
Belo on a per diem basis creditable in
computing the length of service for
retirement purposes? "
A: Yes. The traditional meaning of per diem is
a reimbursement for extra expenses incurred
by the public official in the performance of his
duties. Under this definition the per diem is
intended to cover the cost of lodging and
subsistence of officers and employees when
the latter are on a duty outside of their
permanent station. On the other hand, a per
diem could rightfully be considered a
compensation or remuneration attached to an
office.
The per diems paid to Baradero and Belo were
in the nature of compensation or remuneration
for their services as Sangguniang Bayan and
Vice-Governor, respectively, rather than a
reimbursement for incidental expenses
incurred while away from their home base.
If the remuneration received by a public offlclal
in the performance of his duties does not
constitute a mere "allowance for expenses" but
appears to be his actual base pay, then no
amount of categorizing the salary as a "per
diem" would take the allowances received from
the term service with compensation for the
purpose of computing the number of years of
service in government. (GS/S v esc and Dr.
Baradero and GSIS v. esc and Belo, G. R.
Nos. 98395 and 102449, June 19, 1995)
Q: What government Ees are subject to
coverage under the GSIS?
A:
GR: All Ees receiving compensation who
have not reached the ,.compulsory
retirement age, irrespective of employment
status.
XPN:
1. Uniformed members of the:
a. AFP; and
b. PNP.
Contractuals who have no Er and Ee
relationship with the agencies they
, 2.
serve.
Q: Who are covered by life insurance,
retirement and other social security
protection?
A:
GR: All members of the GSIS shall have
life insurance, retirement, and all other
social security protections such as
disability, survivorship, separation, and
unemployment benefits. (Sec. 3)
XPN: Members of:
1. the judiciary and
2. Constitutional commissions who shall
have life insurance only,
Q: Who under the GSIS are excluded from
the coverage?
A:
1. Ees who have separate retirement
schemes (members of the J udiciary,
Constitutional Commissions and
others similarly situated);
2. Contractual Ees who have no Er-Ee
with the agencies they serve;
3. Uniformed members of the AFP,
BJ MP, whose coverage by the GSIS
has ceased effective J une 24,1997;
4. Uniformed members of the PNP
whose coverage by the GSIS has
ceased effective February 1, 1996.
(Sec. 2.4, Rule II, IRR)
Q: For the purpose of benefit entitlement,
how are the members classified?
A:
1. Active members
a. still in the service and are
paying integrated premiums.
b. covered for the entire package
benefits and privileges being
extended by GSIS.
2. Policyholders
a. covered for life insurance only
b. can avail of policy loan privilege
only
c. may also apply for housing
loans
d. J udiciary and Constitutional
Commissions
Q: What are the sources of funds of the
GSIS?
A: It comes from the monthly contributions of
the covered Ees and Ers. (Sec. 5)
The contributions of the Ees are deducted and
withheld by the Er each month from the
monthly salary of theJ ormer and are remitted
by the latter, together with its own share, to the
System within the first 10 days of each
calendar month following the month to which
the contributions apply. (Sec. 6)
Q: What is the penalty in case of delayed
remittance or non-remittance of
contributions?
A: The unremitted contributions shall be
charged interests as prescribed by the GSIS
Board of Trustees but shall not be less than
2% simple interest per month from due date to
the date of payment by the employers
concerned.
Q: What are the benefits provided by the
GSIS Act?
A:
1. Separation
2. Unemployment or involuntary
separation
3. Retirement
4. Permanent disability
5. Temporary disability
6. Survivorship
7. Funeral
8. Life Insurance
9. Such other benefits and protection as
may be extended to them by the
GSIS such as loans.
Q: What are the benefits under P.O. 1146
(Revised GSIS Act of 1977) that may be
granted to the separated members of the
PNP, BJ MP and BFP?
A:
GR:
1. Old-age benefit
2. Permanent disability benefit
3. Survivorship benefit
4. Funeral benefit
5. Retirement benefit
XPN: J udiciary (Life insurance only - tax
exempt)
Q: Atty. Lianne Guzman, a dedicated and
efficient public official, was the top
executive of a GOCC. While inspecting an
ongoing project in a remote village in
234
Mindanao, she suffered a stroke and
since then had been confined to a
wheelchair. At the time she stopped
working because of her illness in line of
duty, Atty. Guzman was only 60 years old
but she had been an active member of the
GSIS for 30 years without any break in her
service record. What benefits could she
claim from the GSIS? Cite at least five
benefits.
A: The benefits Atty. Guzman could claim
from the GSIS are:
1. Ees compensation which shall
include both income and medical and
related benefits, including
rehabilitation;
2. Temporary total disability benefit;
3. Permanent total disability benefit;
4. Separation benefit; and
5. Retirement benefit (2004 Bar
Question)
Q: What are the reportorial requirements of
the Er?
A: Er must report to GSIS the names,
employment status, positions, salaries of the
employee and such other matter as determined
by the GSIS.
, Separation Benefits
Q: When will a member be entitled to
separation benefits and what comprises
these separation benefits?
A: A member who has rendered a minimum of
3 years creditable service shall be entitled to
separation benefit upon resignation or
separation under the following terms:
1. A member wfth at least 3years but
less than 15 years: Cash payment
equivalent to 100% of the AMC for
every year of service the member has
paid contributions:
a. not less than P12,000.00
b. Payable upon reaching 60 years
of age or upon separation',
whichever comes later.
2. A member wfth less than 15years of
service and less than 60 years of age
at the time of resignation or
separation:
a. Cash payment equivalent to 18
times the basic monthly pension
(BMP), payable at the time of
resignation or separation
b. An old-age pension benefit equal
to the basic monthly pension,
payable monthly for life upon
reaching the age of 60.
Q: What are the effects of separation from
service with regard to membership?
A: A member separated from the service shall
continue to be a member and shall be entitled
to whatever benefits he has qualified to.
Note: A member separated for a (Valid cause
shall automatically forfeit his benefits, unless the
terms of resignation or separation provide
otherwise.
In the case of forfeiture, the separated employee
shall be entitled to receive only Y, of the cash
surrender value of his insurance.
Unemployment or Involuntary
, Separation Benefits
Q: What are the conditions for entitlement
to unemployment benefits?
A:
1. The recipient must be a permanent
employee at the time of separation;
2. His separation was involuntary due to
the abolition of his office or position
resulting from reorganization; and
3. He has been paying the contribution
for at least 1year prior to separation.
Q: What will consist of an unemployment
benefit?
A: It will consists of cash payment equivalent
to 50% of the average monthly compensation
Note: A member who has rendered at least 15
years of service will be entitled to separation
benefits instead of unemployment benefits.
Retirement Benefits
Q: What are the conditions in order to be
entitled to retirement benefits?
A:
1. A member has rendered at least 15
years of service;
2. He is at least 60 years of age at the
time of retirement; and
3. He is not receiving a monthly pension
benefit from permanent total
disability. (Sec. 13-A)
Q: What is the rule in case of extension of
service in order to be entitled for retirement
benefit?
A: The doctrine in Cena v CSC, (G.R. No.
97419, July 3, 1992), was modified in Rabor v
CSC, (G.R. No. 111812, May 31, 1995), where
the SC held that: The head of the government
agency concerned is vested with discretionary
authority to allow or disallow extension of the
service of an official or Ee who has reached 65
years old without completing the 15 years of
government service. However, this discretion
is to be exercise conformably with the
provisions of Civil Service Memorandum
Circular No. 27, series of 1990 which provides
that the extension shall not exceed 1 year.
Q: What is the reason for compulsory
retirement?
A: The compulsory retirement of government
officials and Ees upon their reaching the age
of 65 years is founded on public policy which
aims by it to maintain efficiency in the
government service and at the same time give
to the retiring public servants the opportunity to
enjoy during the remainder of their lives the
recompense, for their long service and
devotion to the government, in the form of a
comparatively easier life, freed from the rigors
of civil service discipline and the exacting
demands that the nature of their work and their
relations with their superiors as well as the
public would impose upon them. (Beronilla v.
GSIS, G.R. No. 21723, Nov. 26, 1970)
Q: What are the options of the retiree with
regard to his or her retirement benefits?
A: The retiree may get either of the following:
1. Lump sum equivalent to 6 months of
the basic monthly pension (BMP)
payable at the time of retirement and
an old-age pension benefit equal to
BMP payable for life, starting upon
the expiration of the 5 years covered
by the lump sum; or
2. Cash payment equivalent to 18 times
his BMP and monthly pension for life
payable immediately. (Sec. 13[a])
Permanent Disability Benefits
Q: What are the conditions in order to be
entitled for permanent disability benefits?
A: The permanent disability was not due to
any of the ff:
1. Grave misconduct
2. Notorious negligence
3. Habitual intoxication
, ........
U NI V E R 5 I T Y 0 F SAN ToT 0 MAS ~. 235
Pacu(tatl ti e < Der ecfi o CiviC '.-
4. Willful intention to kill himself or another
Q: What are the two types of permanent
disability?
A:
1. Permanent total disability (PTO) -
accrues or arises when recovery from
any loss or impairment of the normal
functions of the physical and/or
mental faculty of a member which
reduces or eliminates his capacity to
continue with his current gainful
occupation or engage in any other
gainful occupation is medically
remote. {Section 2(q) and (s)}
2. Permanent partial disability (PPD) -
accrues or arises upon the
irrevocable loss or impairment of
certain portion/s of the physical
faculties, despite which the member
is able to pursue a gainful occupation.
(Sec.2{uJ)
1.any finger
2.any toe
3.one arm
4.one hand
5.one foot
6.one leg
7.one or both ears
8.hearing of one or both ears
9.sight of one eye
.B!lI.lWilfiflIII]jBliiliililiiil~~.~s~uc~h other caus as determined GSIS
of sight of both eyes
2. loss of 2 limbs at or above the ankle or wrist
3. permanent complete paralysis of 2 limbs
4. brain injury resulting in incurable imbecility or
insanity
5. such other cases as may be determined by the
GSIS
1.A member is entitled to the monthly income benefit
for life equivalent to the BMP when:
a. he is in the service at the time of the disability
or
b. if separated from service
c. he has paid at least 36 monthly contributions
within 5 years immediately preceding his
disability
d. he has paid a total of at least 180 monthly
contribution prior his disability
e. he is not receiving old-age retirement pension
benefits
2. If the member does not satisfy the conditions above
but has rendered at least 3years service, he shall be
advanced the cash payment equivalent to 100% of his
average monthly compensation for each year of
service he has pad contributions but not less than
P12,OOO.OO which should have been his separation
benefit shall no ion benefits
Q: Whenwill the paymentof these benefits
besuspended?
A:
1. In case a member is re-employed; or
2. Member recovers from disability as
determined by the GSIS; or
3. Fails to present himself for medical
examination when required by the
GSIS. (Sec. 16(c})
236
member is entitled to cash payment in
accordance with the schedule of disabilities to be
prescribed by GSIS, if he satisfies the given
conditions of either (1) or (2) of Sec. 16(a).
Q: Manioso was suffering from several
diseases from 1959 to 1994 when he
worked as Accounting ClerkI atthe Budget
CommiSSion up to the time he was
transferred and promoted to the DENRas
Senior Bookkeeper. On J an. 11-20, '95, he
was hospitalized. The results of his
examinations showedthat hewas suffering
from Acute Myocardial Infarction and
Hypertensive Vascular Disease. FromJ an
11- May5, '95when he compulsory retired
from government service and after serving
for 36 yrs, he no longer reported for
work. His sick leave covering said period
was duly approved. In the meantime,
Manioso filed a claim for income benefits
with the GSIS which found his ailments
work-related. He was granted Temporary
Total Disability benefits for 2 months. He
was later granted Permanent Partial
Disability benefits for 8 months. It appears
that he appealed for more disability
benefits with the GSIS which subjected him
to a series of medical tests, In '97, he was
brought to the PGH several times due to
Chronic Renal Infection 2' to Obstructive
Uropathy 2' to Staghorn Calctlli (L).and
Benign Prostatic Hypertrophy; Diabetes
Mellitus Neprophaty, Stage IV, and
Hypertensive Nephrosclerosis. He then
filed a request with the GSIS for additional
disability benefits, claiming that the
ailments for which he was hospitalized
several times in '97 developed from his
work-related illnesses. The GSIS
disapproved Manioso's request
Do Manioso's ailments which later
developed fall under the category of
permanent total disability?
A: Yes. Under Art. 192 (c) of =.o. No. 442, as
amended(the LC), thefollowing disabilities are
deemed total and permanent: (1) Temporary
total disability lasting continuously for more
than 120 days. Under Section2(b), RuleVII of
the Amended Rules on Ee's Compensation,
"[a] disability is total and permanent if as a
result of the injury or sickness the Eeis unable
to perform any' gainful occupation for a
continuous period exceeding 120days, except
as otherwise provided under Rule X of these
RUles." In the case at bar, Manioso was on
sick leave from Jan 11, '95 up to his date of
retirement on May 15, '95 or for a period of
more than 120 days. Surely, the DENR. in
approving his more than 120 days leave must
have passed upon his Medical Certificate
relative to his ailments. Manioso's disability
having lasted for more than 120 days, he is
entitled to PTDbenefits. (Bernandino Manioso,
vs. GSIS, G.R. No. 148323, Apr. 29, 2005, J .
Carpio-Morales)
Q: Does Manioso's retirement from service
prevent him from entitlement to PTD
benefits?
Permanent Total Disability. (Bemandin
Manioso, vs. GSIS, G.R. No. 148323, Apr. 2 ,
2005, J Carpio-Morales)
~ Temporary-Disability'Benefits,'
Q: When does temporary total disability
arises?
A: It accrues or arises when the impaired
physical and/or mental faculties can be
rehabilitated and/or restored to their normal
functions. (Sec 2ft))
Q:What benefits are given for temporary
disability?
A:
1. Member is entitled to 75% of his
current daily compensation for eac
day or fraction thereof of total
disability benefit, tostart at the4thday
but not exceeding 120 days in one
calendar year when:
a. he has exhausted all sic
leaves
b. CBA sick leave benefits
Provided, that:
i. he was in the service a'
time of disability; or
ii. if separated, he has rendeed
at least 3 years of service a
has paid at least 6 mont
contributions in the yea
preceding his disability
2, The temporary total disability benefits
shall in no case be less than P70 a
day.
Note: A membercannotenjoythetemporarytota
disability benefit and sick leave pa
simultaneously,
Anapplicationfor disabilitymustbefiledwiththe
GSIS within 4 years from the date of the
occurrenceofthecontingency.
A: No. Benefits due an Ee dueto work-related
sickness shall be provided until he becomes
gainfully employed, or until his recovery or
death. None of these are present in Manioso's
case, It would be an affront to justice if
Manioso, a government Eewho had servedfor
36 years, is deprived of the benefits due him
for work-related ailments that resulted in his
UNiVERSITY OF SANTO TOMAS' ~~ 237
Pacu[ taa de < Der ecfzo Ci vi C ' ,.
. Survivorship Benefits
Q: Who are entitled to survivorship
benefits?
A: Upon the death of a member or pensioner,
his beneficiaries shall be entitled to
survivorship benefits. Such benefit shall
consist of:
1. the basic survivorship pension which
is 50% of the basic monthly pension;
and
2. the dependent children's pension not
exceeding 50% of the basic monthly
pension
Q: Under what conditions are the primary
beneficiaries entitled to the basic monthly
pension?
A: Upon the death of a member, the primary
beneficiaries shall be entitled to:
1. Survivorship pension: Provided, That
the deceased:
a. was in the service at the time of
his death; or
b. if separated from the service, has
rendered at least 3 years of
service at the time of his death
and has paid 36 monthly
contributions within the five-year
period immediately preceding his
death; or has paid a total of at
least 180 monthly contributions
prior to his death; or
2. The sutvivorshlp pension plus a cash
payment equivalent to 100% of his
average monthly compensation for
every year of service: Provided, That
the deceased was in the service at
the time of his death with at least 3
years of service; OR
3. A cash payment equivalent to 100% of
his average monthly compensation
for each year of service he paid
contributions, but not less than
P12,000.OO: Provided, That the
deceased has rendered at least 3
years of service prior to his death but
does not qualify for the benefits under
item (1) or (2) of this paragraph. [Sec.
21 (a)J
238
Q: After the end of the guaranteed 30
months, are the beneficiaries still entitled
to any survivorship benefits?
A: Yes. The survivorship pension shall be paid
as follows:
1. When the dependent spouse is the
only survivor, he/she shall receive the
basic survivorship pension for life or
until he or she remarries;
2. When only dependent children are
the survivors, they shall be entitled to
the basic survivorship pension for as
long as they are qualified, plus the
dependent children's pension
equivalent to 10% of the basic
monthly pension for every dependent
child not exceeding 5, counted from
the youngest and without substitution:
3. When the survivors are the
dependent spouse and the
dependent children, the dependent
spouse shall receive the basic
survivorship pension for life or until
he/she remarries, and the dependent
children shall receive the dependent
children's pension.(Sec. 21[bJ)
Note: The dependent children shall be entitled to
the survivorship pension as long as there are
dependent children and, thereafter, the surviving
spouse shall receive the basic survivorship
pension for life or until he or she remarries.
Q: When are secondary beneficiaries
entitled to survivorship benefits?
A: In the absence of primary benefiCiaries, the
secondary beneficiaries shall be entitled to:
1. The cash payment equivalent to
100% of his average monthly
compensation for each year of
service he paid contributions, but not
less than P12,OOO.00: Provided, That
the member is in the service at the
time of his death and has at least 3
years of service; or
2. In the absence of secondary
beneficiaries, the benefits under this
par. shall be paid to his legal heirs.
(Sec. 21[c])
Q: What are the benefits that the
beneficiaries are entitled to upon the death
of the pensioner?
A:
1. Upon the death of an old-age
pensioneror a memberreceivingthe
monthlyincomebenefitfor permanent
disability, the qualified beneficiaries
shall be entitled to the survivorship
pension definedinSec. 20of thisAct,
subjecttotheprovisionsof par. (b) of
Sec.21. ~) ~
2. When the pensioner dies within the
periodcoveredbythe lumpsum, the
survivorship pension shall be paid
only after the expirationof the said
period.
Q: Gary Leseng was employed as a public
school teacher at the Marinduque High. On
April 27, 1997, a memorandum was issued
by the school principal designating Gary to
prepare the model dam project, which will
be the official entry of the school in the
search for Outstanding _ Improvised
Secondary Science Equipment for
Teachers. Gary complied with his
superior's instruction and took home the
project to enable him to finish before the
deadline. While working on the model dam
project, he came to contact with a live wire
and was electrocuted. The death certificate
showed that he died of cardiac arrest due to
accidental electrocution. .
Bella (Gary's common-law wife) and J obo
(his only son) filed a claim for death
benefits with the GSIS which was denied
on the ground that Gary's death did not
arise out of and in the course of
employment and therefore not
compensable because the accident
occurred in his house and not in the
school premises. Is Bella entitled to file
a claim for death benefits with the GSIS?
Why?
A: Thebeneficiariesof a memberof theGSIS
areentitled to the benefits arising from the
death of said member. Death benefits are
called survivorship benefits under the GSIS
Law. Not being a beneficiary, Bella is not
entitledto receive survivorshipbenefits.She
is not a beneficiary because she is a
common-lawwife and not a legal dependent
spouse.(1991BarQuestion)
Q: Is the cause of death of Gary (cardiac
arrest due to accidental electrocution in
his house) compensable? Why?
A: Yes. To be compensableunderthe GSIS
Law,the deathneednotbeworkconnected.
Q: Abraham, a policeman, was on leavefor
a month. While resting in their house, he
heard two of his neighbors fighting with
each other. Abraham rushed to the
scene intending to pacify the
protagonists. However, he was shot to
death by one of the protagonists. EvaJ oy,
a housemaid, was Abraham's surviving
spouse whom he had abandoned for
another woman years back. When she
learned of Abraham's death, Eva J oy filed
a claim with the GSIS for death benefits.
However, her claim was denied because:
(a) when Abraham was killed, he was on
leave; and (b) she was not the dependent
spouse of Abrahamwhen he died. Resolve
with reasons whether GSIS is correct in
denying the claim.
A: Yes, becauseunderthe law, adependentis
onewho is a legitimate spouse living
with the Ee. (Art 167[iJ, LG) In the problem
given, Eva J oy had been abandoned by
Abraham who was then living already with
anotherwomanatthetimeof hisdeath.
Moreover,Abrahamwas onleavewhenhewas
killed. The 24-hour duty rule does not apply
whenthe policemanisonvacationleave.(EGG
v. Court of Appeals, G.R. No. 121545,Nov. 14,
1996) Taking together jurisprudenceand the
pertinentguidelinesof the EGGwithrespectto
claimsfor deathbenefits,namely:
1. That the Ee must be at the place
wherehis workrequireshimtobe;
2. That the Ee must have' been
performinghisofficialfunctions;and
3. That if the injury is sustained
elsewhere, the Ee must have been
executinganorderfor the Er, it is not
difficult to understandthen why Eva
J oy'sclaimwas denied by theGSIS.
(Tancinco v. GSIS, G.R. No. 132916,
Nov. 16,2001)
In the present case, Abrahamwas restingat
his house when the incident happened;thus,
he was not at the place where his work
requiredhimto be. Althoughatthetimeof his
death Abraham was performing a police
function, it cannot be said that his death
occurred elsewhere other than the place
where he was supposed to be because he
was executingan orderfor his Er. (2005Bar
Question)
Pacu[ tad de (] )er echo Ci vi l " ' "
: Funeral Benefits . .
Q: What comprises the funeral benefit?
A: Cash not less than P12,OOO to be
increased to at least P18,OOO after 5 years
(specifically year 2002). The amount shall be
determined and specified by the GSIS through
an information circular distributed to all Ers for
posting at their premises. (Sec. 23, par. 1)
Q: When will it be paid?
A: Upon the death of:
1. An active member
2. A member who has been separated
from the service but is entitled to
future separation or retirement
benefits
3. A member who is a pensioner
(excluding survivorship pensioners)
4. A retiree who is at the time of his
retirement was of pensionable age, at
least 60 years old, who opted to retire
under RA 1616.
, Life Insurance Benefits
3. For those without any life insurance
as of the effectivity of this Act, their
insurance shall take effect following
said effectivity.
Q: When maya member obtain optional
life insurance coverage?
A:
1. A member may at any time apply for
himself and/or his dependents an
insurance and/or pre-need coverage
embracing:
a. Life
b. Memorlal plans
c. Health
d. Education
e. Hospitalization
f. Other plans as maybe designed
by GSIS
2. Any employer may apply for group
insurance coverage for its
employees.
Loan Grant
Q: What are the classes of life insurance
coverage? A:
Q: Where can GSIS loans be invested in?
A:
1. Compulsory life insurance
2. Optional life insurance .
Note: The plans may be endowment or ordinary
life.
Q: When does compulsory life insurance
coverage take effect?
A: All Ees including the members of the
J udiciary and the Constitutional
Commissioners except for Members of the
AFP, the PNP, BFP and BJ MP, shall, under
such terms and conditions as may be
promulgated by the GSIS, be compulsorily
covered with life insurance, which shall
automatically take effect as follows:
1. Those employed after the effectivity
of this Act, their insurance shall take
effect on the date of their
employment;
2. For those whose insurance will
mature after the effectivity of this Act,
their insurance shall be deemed
renewed on the day following the
maturity or expiry date of their
insurance;
1. In direct housing loans to members
and group housing projects secured
by first mortgage giving priority to the
low income groups
2. In short and medium term loans to
members such as salary, policy,
educational, emergency stock
purchase plan, and other similar
loans
Q: What is the prescriptive period to claim
the benefits?
A:
GR: 4 Years from the date of contingency
XPN: Life insurance and retirement (Sec.
28)
Q: What is the process for the adjudication
of claims and disputes regarding the GSIS
benefits?
A: The quasi-judicial functions of the GSIS
shall be vested in its Board of Trustees.
1. The GSIS, in appropriate cases, or
any person whose rights are or may
be prejudiced by the operations or
enforcement of R.A. 8291 and other
laws administered by the GSIS, may
file a petition before the GSIS either
personally or through counsel.
2. Within 15 days from receipt of the
notice of decision or award, the
aggrieved party may appeal the
decision of the GSIS Board of
Trustees to the CA. Appeal shall be
taken by filling a verified petition for
review with the CA. (Sec 1 to 5, Rule
43, Rules of Court)
3.
,
When no appeal is perfected and
there is no order to stay by the Board,
by the CA or by the SC, any decision
or award of the Board shall be
enforced and executed in the same
manner as decisions of the RTC.
Note: The social security benefits shall
be exempt from attachment,
garnishment, execution, levy or other
processes issued by the courts, quasi-
judicial bodies or administrative
agencies including the Commission on
Audit, disallowances, and from all
financial obligations of the members.
Q: May a member enjoy the benefits
provided for in the Revised GSIS Act
simultaneous with similar benefits
provided under other laws for the same
contingency?
A: Whenever other laws provide similar
benefits for the same contingencies covered
by this Act, the member who qualifies to the
benefits shall have the option to choose which
benefits will be paid to him. However, if the
benefits provided by the law chosen are less
than the benefits provided under this Act, the
GSIS shall pay only the difference. (Sec. 55)
Q: State the respective coverage of:
1. The Social Security Law
2. The Revised Government Service Insurance Act and
3. The Ees Compensation Act.
Social Security Law Revised Government Service Employees
Insurance Act Compensation Act
A:
Compulsory upon all Ers and their
Ees not over 60 years of age;
Provided, that an Ee who is over
60 years of age and paying
contributions to qualify for the
retirement or life insurance benefit
administered by the System shall
be subject to compulsory coverage.
Compulsory upon all E es not
over 60 years of age and
their Ers.
Compulsory for all permanent Ees
below 60 years of age upon
appointment to permanent status,
and for all elective officials for the
duration of their tenure. 1.Filipinos recruited in the Phils.
by foreign - based Ers for
employment abroad may be
covered by the SSS on a
voluntary basis.
1.Any person, whether elected
or appointed, in the service of an
Er is a covered Ee if he receives
compensation for such service.
2.
Compulsory upon all self-
employed persons earning
P1,800or more per annum.
Note: The Ees Compensation Commission shall ensure adequate coverage of Filipino Ees employed abroad,
subject to regulations as it may prescribe. (Art. 170) Any person compulsorily covered by the GSIS
including the members of the AFP, and any person employed as casual, emergency, temporary, substitute or
contractual, or any person compulsorily covered by the SSS are covered by the Ee's Compensation Program.
(1997 Bar Question)
U NI V E R 5 I T Y 0 F SAN ToT 0 MA'5
Pacu(taa ae ! J)er ecno CiviC
241
SOCIAL LEGISLATION: PORTABILITY LAw
Q: What is the limited portability rule?
A: A covered worker who transfers
employment from one sector to another or is
employed on both sectors, shall have
creditable services. or contributions on both
Systems creditedto his service or contribution
record in each of the Systems and shall be
totalized for purposes of old-age, disability,
survivorship, and other benefits in either or
bothSystems. (Sec. 3)
All contributions paid by such member
personally, and those that were paid by his
employers to both Systems shall be
considered inthe processing of benefits which
he can claim from either or both Systems.
(Sec. 4)
Q: How are the "portability" provisrons of
R.A. No. 7699 beneficial or advantageous
to SSS and GSIS members in terms of their
creditable employment services in the
private sector or the government, as the
case may be, for purposes of death,
disability or retirement?
A: Portability provisions of R.A. No. 7699
shall benefit a covered worker whose
creditable services or contributions in both
systems creditedto his service or contribution
record in each of the system and shall be
totalized for purposes of old-age, disability,
survivorship and other benefits. (Sec. 3)
The "portability" provisions of R.A. 7699 allow
the transfer of funds for the account and
benefit of the worker who transfers from one
systemtoanother.
This is advantageous to the SSS and GSIS
members for purposes of death, disability or
retirement benefits. Inthe event the employees
transfer from the private sector to the public
sector, or vice-versa, their creditable
employment services and contributions are
carriedover and transferred as well. (2005 Bar
Question)
242
Academics Committee
Vi ce-Chai r for L qyout &Desi gn: Loise Rae G.Naval
Labor LawCommittee
Members:
AngeloS.Diokno
Genesis R.Fulgencio
J eanelle C.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
Q: What is the concept of paternity leave
benefits?
A: Notwithstanding any law, rules and
regulations to the contrary, every married male
employee in the private and public sectors
shall be entitled to a paternity leave of 7 days
with full pay for the first 4 deliveries of the
legitimate spouse with whom he is cohabiting.
Q: What is paternity leave?
A: It refers to the benefits granted to a
married male employee allowing him not to
report for work for 7 days but continues to earn
the compensation therefore, 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.
Q: What are the requirements in order to
avail paternity leave?
A: The male employee (Ee) applying for
paternity leave shall:
1. Notify his employer (Er) of the
pregnancy of his legitimate spouse
and
2. The expected date of such delivery.
Q: What are the conditions for entitlement
to paternity leave?
A: The male Ee is;
1. Legally married to, and is cohabiting
with the woman who delivers the
baby
2. Ee of private or public sector;
3. Only for the first 4 deliveries of
legitimate spouse with whom he is
cohabiting; and
4. Notify his Er of the pregnancy of his
legitimate spouse and the expected
date of such delivery
Note: For purposes of this Act, delivery shall
include childbirth or any miscarriage.
4 .~ . ,r~.," fIIY.'
Academics Committee
Vi ce-Chai r for L qyout &Desi gn: Loise RaeG.Naval
Labor LawCommittee
Subj ect H ead' Lester J ay .AlanE.FloresII
Members:
ChristianNinoA.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelleC.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
UN I VE R SIT Y 0 F SAN ToT 0 MAS'
Pacu{ taa ae Ver ecno Civif
243
SOCIAL LEGISLATION: SOLO PARENTS WELFARE ACT OF 2000
Q;Who shall be eligible for assistance?
Q Who is a "solo parent"?
A: Any individual who falls under any of the ft.
categories:
1. A woman who gives birth as a result of
rape and' other crimes against
chastity even without a final
conviction of the offender, provided,
That the mother keeps and raises the
child;
2. Parent left solo or alone with the
responsibility of parenthood due to:
a. Death of spouse;
b. Detention or service of sentence of
spouse for a criminal conviction
for at least 1 yr;
c. Physical and/or mental incapacity
of spouse
d. Legal separation or de facto
separation from spouse for at
least 1 yr as long as he/she is
entrusted with the custody of the
children;
e. Nullity or annulment of marriage as
decreed by a court or by a church
as long as he/she is entrusted
with the custody of the children;
f. Abandonment of spouse for at
least 1 yr;
3. Unmarried mother/father who has
preferred to keep and rear his or her
child/children instead ot.
a. having others care for them or
b. give them up to a welfare
institution;
4. Any other person who solely provides:
a. parental care and
b. support to a child or children;
5. Any family member who assumes the
responsibility of head of family as a
result of the:
a. death,
b. abandonment,
c. disappearance or
, d. prolonged absence of the parents
or solo parent.
Note: A change in the status or circumstance of
the parent claiming benefits under this Act, such
that helshe is no longer left alone with the
responsibility of parenthood, shall terminate
his/her eligibility for these benefits. (Sec.3)
244
A; Any solo parent whose income in the place
of domicile falls below the poverty threshold as
set by the NEDA and subject to the
assessment of the DSWD worker in the area,
Provided, however, That any solo parent
whose income is above the poverty threshold
shall enjoy the benefits mentioned in Sec. 6, 7
and 8of this Act.
Q: What are the benefits available to a solo
parent?
A:
1. Flexible work schedule (Sec. 6)
2. No work discrimination (Sec. 7)
3. Parental Leave (Sec. 8)
4. . Educational Benefits (Sec. 9)
5. Housing Benefits (Sec, 10)
6. Medical Assistance (Sec 11)
Q: What is a flexible work schedule?
A: The right granted to a solo parent Ee to
vary his/her arrival and departure time
without affecting the core work hours as
defined by the Er.
Provided: That any Er may request
exemption from the above requirements
from the DOLE on certain meritorious
grounds, (Sec 6)
Q: What is parental leave?
A: Leave benefits granted to a solo parent to
enable him/her to perform parental duties
and responsibilities - where physical
presence is required.
In addition to leave privileges under
existing laws, parental leave of not more
than 7 working days every year shall be
granted to any solo parent Ee who has
rendered service of at least 1 year. (Sec. 8)
Q: What is the rule on educational
benefits?
A: The DECS, CHED and TESDA shall
provide the following benefits and
privileges:
1. Scholarship programs for qualified solo
parents and their children in
institutions of basic, tertiary and
technical/skills education; and
2. Nonformal education programs
appropriate for solo parents and their
children. (Sec. 9)
Q: What is the rule on housing benefits?
A: Solo parents shall be given allocation in
housing projects and shall be provided
with liberal terms of payment on said
government low-cost housing projects in
accordance with housing law provisions
prioritizing applicants below the poverty line
as declared by the NEDA. (Sec. ~10) ~
Academics Committee
Chai r per son: Abraham D.Genuino n
Vi ce-Chai r for Admi n &F i nance: Aissa CelineH. Luna
Vi ce-Chai r for L ayout &Desi gn: Loise RaeG. -aval
Labor LawCommittee
SI I j ect H ead' Lester J ay AlanE. Flores
Assi stant Subj ect H ead' Domingo B.Diviva \-
Members:
ChristianNinoA Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelleC. Lee
J emuel PaoloM.Lobo
Andrew W.Montcsa
PacuCtaa de Ver ecno Civi]
245
SOCIAL LEGISLATION: PERA ACT OF 2008
Q: What is the Personal Equity and
Retirement Account (PERA)?
A: It is a voluntary retirement account
established by and for the exclusive use and
benefit of a contributor for the purpose of being
invested solely in PERA investment products
in the Philippines. The contributor shall retain
the ownership, whether legal or beneficial, of
funds placed therein, including all earnings of
such funds. He makes all investment decisions
pertaining to his PERA, with an option to
appoint an Investment Manager.
Q: What is a contributor?
A: Any person with the capacity to contract
and possesses a tax identification number who
establishes and makes contributions to a
PERA.
Q: Can a contributor establish more than 1
PERA?
A: Yes. A Contributor may create and maintain
a maximum of 5 PERAs, at anyone time,
provided that the contributor shall designate
and maintain only one administrator for all his
PERA.
Q: What is the benefit to the Ers if they
contribute?
A: If a private Er decides to contribute to its
Ees PERA, the amount shall be allowed as a
deduction from the Ers gross income.
However, the Er must also comply with the
mandatory SSS contribution and retirement
pay.
Q: How much mayan Er contribute?
A: The Er can only contribute up to the extent
of the amount allowable to the contributor/Ee.
Q: When can a distribution be made?
A:
1. Upon reaching the age of 55 years:
Provided, That the contributor has
made contributions to the PERA for at
least 5years. The distribution shall be
made in either lump sum or pension
for a definite period or lifetime
pension, at the option of the
contributor. The contributor, however,
has the option to continue the PERA;
or
246
2. Upon the death of the contributor,
irrespective of the age of the
contributor at the time of his death a
complete distribution shall be made.
Q: What is early withdrawal?
A:
GR:
1. Any withdrawal of PERA assets
before reaching the age of 55 or the
death of the contributor;
2. Any withdrawal of PERA assets
before the contributor has made
contributions to his PERA for at least
5years; or
XPN: When the entire proceeds from such
withdrawal are immediately transferred to
another PERA Investment Product andlor
another administrator.
Q: What is the penalty on early withdrawal?
A: The penalty would be equal to the tax
incentives enjoyed by the Contributor during
the entire period of the PERA (lRR, Rule 15)
Q: When can there be an early withdrawal
without a penalty?
A: No early withdrawal penalty shall be
imposed on any withdrawal of any funds for
the following purposes:
1. For payment of accident or iIIness-
related hospitalization in excess of 30
days attested by a notarized doctor's
certificate; and
2. For payment to a contributor who
has been subsequently rendered
permanently totally disabled as
defined under the Ee's
Compensation Law, Social Security
Law and Government Service
Insurance System Law together with
a certification from the pertinent
government agency.
COMPREHENSIVE
AGR.A.R.I A.N.REFORM L.A.W .O.F.1988
R.A.66S7.
'Asameridedby R.A. 9700
Q: What are the Constitutional Provisions
governing Comprehensive Agrarian Reform
Law (CARL)?
A:
1. Sec. 9, Art. II, Declaration of
Principles and State Policies;
2. Sec. 9, Art. III, Bill of Rights; ~
3. Sec. 7, Art. X: Local Government;
4. Sec. 1 - 3, Art XII, National
Economy and Patrimony;
. 5. Sec. 4- 6 and 8, Art. XIII, Social
J ustice and Human Rights;
6. Sec. 22, Art. XVIII, Transitory
Provisions
Q: What are the principle and policies of
the State in the enactment of CARP Law of
1988?
A: The welfare of the landless farmers and
farm workers will receive t~e highest
consideration to promote social justice and to
move the nation towards sound rural
development and industrialization, and the
establishment of owner cultivatorship of
economic-sized farms as the basis of
Philippine agriculture.
The State shall promote industrialization and
full employment based on sound ag'ricultural
development and agrarian reform, through
industries that make full and efficient use of
human and natural resources, and which are
competitive in both domestic and foreign
markets, taking into account tillers' rights and
national food security.
The agrarian reform program is founded on the
right of farmers and regular farm workers, who
are landless, to own directly or collectively the
lands they till or, in the case of other farm
workers, to receive a share of the fruits
thereof.
The State shall recognize and enforce the
rights of rural women to own and control land,
to receive a just share of the fruits thereof, and
to be represented in advisory or appropriate
decision-making bodies. These rights shall be
independent of their male relatives and of their
civil status.
This land-sharing shall be subject to prior
rights, homestead rights of small settlers and
the rights of indigenous communities to their
ancestral lands.
The State shall protect the rights of
subsistence fishermen to the preferential use
of communal marine and fishing resources. It
shall provide support through appropriate
technology and research, adequate financial,
production and marketing assistance and other
services.
The State shall provide incentives to
landowners to invest the proceeds of the "
agrarian reform program to promote
industrialization, employment and privatization
of public sector enterprises.
Note: R.A. 6657 has not been superseded by the
CARPER Law or R.A. 9700 but strengthens or
improves the CARL.
Q: Upon what right is the agrarian reform
program to be undertaken by the State
founded?
A: It is founded on the right of the farmers and
regular farmworkers, who are landless, to own
directly or collectively, the lands they till or, in
the case of other farmworkers, to receive a just
share of the fruits thereof. (Sec. 4, Art. XII,
1987 Constitution)
Q: What is agrarian reform?
A: Agrarian reform means the redistribution of
lands, regardless of crops or fruits produced,
to farmers and regular farm workers who are
landless, irrespective of tenurial arrangement,
to include the totality of factors and support
services designed to lift the economic status of
the beneficiaries and all other arrangements
alternative to the physical redistribution of
lands, such as production or profit-sharing,
labor administration, and the distribution of
shares of stock which will allow beneficiaries to
receive a just share of the fruits of the lands
they work. [Section 3[a])
Q: What is agriculture, agricultural
enterprise or agricultural activity?
A: It means the cultivation of the soil, planting
of crops, growing of fruit trees, including the
harvesting of such farm products, and other
farm activities and practices performed by a
farmer in conjunction with such farming
operations done by persons whether natural of
juridical. (Section 3 [bJ, as amended by R. A.
7881)
UNIVERSITY OF SANTO TOMAS' ~i~ 247
PacuCtaa de (] )eT' eChO Ci vi C
SOCIAL LEGISLATION: AGRARIAN REFORM
Q: What is an agricultural land?
A: It refers to land devoted to agricultural
activityas defined in this Act and not classified
as mineral, forest, residential, commercial or
industrial land. (Sec. 3[cl)
To make the land agriculture, it is not enough
that crops are grown or animals are raised
thereon; the land must be by destination
devotedto agricultural production; if the raising
of crops or animals are simply incidental tothe
principal purpose, the land is not agricultural.
(PNR v. Han. Del Valle, et. aI., G.R. No. L-
29381, Sep. 30, 1969) .
Q: Is the conversion of agricultural land to
non-agricultural land allowed?
A: No. Under the CARPER Law, irrigated and
irrigable lands, shall not be subject to
conversion. (Sec. 22, R.A. 9700) Any
conversion to avoid CARP coverage is a
prohibitedact.(Sec. 24, R.A.9700)
Q: What is an agrarian dispute?
A: It refers to any controversy relating to
tenurial arrangements, whether leasehold,
tenancy, stewardship or otherwise, over lands
devoted to agriculture, including disputes
concerning the fannworkers' association or
representation of person in negotiating, fixing,
. maintaining, changing, or seeking to arrange
terms or conditions of such tenurial
arrangements.
It includes controversy relating to
compensationof lands acquired under this Act
and other terms and conditions of transfer of
ownership from landowners to fannworkers,
tenants and other agrarian reform
beneficiaries, whether the disputants stand in
the proximate relation of farm operator and
beneficiary, landowner and tenant, or lessor
andlessee(Sec. 3(d), RA 6657)
Q: The guardians over properties owned by
one Almendras initially soid, with the
approval of the guardianship court the lots
comprlsmg the subject plantation to
petitioners. Thereafter, the respondents
filed an ejectment case against petitioners
and also filed a Complaint, before the DAR,
alleging that, Almendras installed them in
the late 40's and early 50's as share
tenants, tenant-tillers, and farmworkers in
the plantation. Provincial Adjudicator
decided in favor of respondents.
Petitioners appealed the decision to the
DARAB.
243
Are the essential elements of agricultural
tenancy are supported by the evidence,
therefore considering respondents as
legitimate share tenants?
A: No. It is settled that the existence of a
tenancy relationship cannot be presumed.
There must be evidence to prove it. For a
tenancy relationship to exist, the following
essential elements must concur: The
1. The parties are the landowner and
the tenant or agricultural lessee;
2. The subject matter of the relationship
is anagricultural land;
3. There is consent between the parties
tothe relationship;
4. The purpose of the relationship is to
bringabout agricultural production;
5. There is personal cultivation on the
part of the tenant or agricultural
lessee; and
6. The harvest is shared between
landowner and the tenant or
agricultural lessee.
Of the essential elements of a tenancy
relationship, the records do not show that the
first, third, and fourth elements had been
proved by substantial evidence. No written
tenancy contract or proof of acts implying a
mutual agreement to enter into a tenancy
contract betweenAlmendras and respondents
was proffered. Respondents not being tenants,
the case is not an agrarian dispute, hence,
beyond the DARAB's jurisotction. It was,
therefore, error for the Court of Appeals to
reverse the DARAB finding that, among other
things, respondentsfailed to prove their status
as bona fide tenantsllessees of the plantation.
(Dalwampo, et al. V. Quinocol Farmers, et al.,
G.R. No. 160614, Apr. 25, 2006, J. Carpio-
Morales)
A:
Q: Distinguish a farmer from a farmworker.
I., ~, ,farmer : 0 - Farmworker
Refers to a natural
person whose
primary livelihood is
cultivation of land or
the production of
agricultural crops
either by himself, or
primarily with the
assistance of his
immediate farm
household, whether
the land is owned by
him, or by another
person under a
leasehold or share
tenancy agreement
or arrangement with
the owner thereof.
(Sec, 3(f])
A. natural person who
renders service for
value as an employee
or laborer in an
agricultural enterprise
or farm regardless of
whether his
compensation is paid
on a datly, weekly,
monthly or " pafyaw"
basis, The term
includes an individual
whose work has
ceased as a
consequence of, or in
connection with, a
pending agrarian
dispute who has not
obtained a
substantially
equivalent and
regular farm
employment, (Sec. 3
9
Q: What are the classifications of
farmworkers?
Regular I Seasonal I Other
Farmworker Farmworker farmworker
A:
Natural
person who
is employed
on a
permanent
basis by an
agricultural
enterprise or
farm. (Sec. 3
(hJ)
Natural
person who
is employed
on a
recurrent,
periodic or
intermittent
basis by an
agricultural
enterprise or
farm, whether
as a
permanent or
a non-
permanent
laborer, such
as " dumaan" ,
" sacada" ,
and the like.
(Sec. 3 [iJ)
Farmworker
who does not
fall under
paragraphs
(g), (h) and
(i), (Sec. 3{jJ)
(BARC) to first certify that the potential
beneficiaries are Farmers or Regular
Farmworkers actually tilling the lands and the list
should by attested under oath by the Landowner
and lastly will state under oath before ajudge that
he/she is willing to work on the land and make it
productive and assume the obligation of paying
the amortization.
Q: Under the CARPER Law in what form
should land be awarded to the
beneficiaries?
A: As a matter of policy in the CARPER law,
land awarded should be in the form of
individual title.
Note: Award of the land must be in actual and
physical possession of the land in contrast with
non-distributed schemes like Leaseback
agreements and Stock distribution open. (R.A.
9700)
Q: What are the conditions under the
CARPER law for the issuance of collective
titles?
A: The conditions for the issuance of collective
titles are as follows:
1. The current farm management
system of the land covered by carp
will not be appropriate for individual
farming of farm parcels;
2, The farm labor system is specialized,
where the farmworkers are organized
by functions and not by specific
parcels such as spraying, weeding,
packing and other similar functions;
The potential beneficiaries are
currently not farming individual
parcels but collectively work on large
contiguous areas; and
3,
4. The farm consists of multiple crops
being farmed in an integrated manner
or includes non-crop production areas
that are necessary for the viability of
farm operations, such as packing
plants, storage areas, dikes, and
other similar facilities that cannot be
subdivided or assigned to individual
farmers. (Sec. 10, R.A. 9700)
Note: Tenants and Regular Farmworkers Are
First Priority Beneficiaries. (Sec. 8, R.A. 9700)
Under the CARPER law a new procedure for the
identification of agrarian reform beneficiaries
requires the Barangay Agrarian Reform Council
Pacu(taa d <Dereclio Ci" fJiC
c
. " 249
Q: A Certificate of Land Ownership Award
(CLOA) was issued to the owner, Cristobal
Olar covering the subject lot. Respondents,
OIar's legal heirs, allowed Spouses Capitle
to occupy the lot. Subsequently, Spouses
Capltle did not pay rentals despite demand,
and neither did they heed the demand to
return the possession of the lot, claiming
that they have been in possession of the lot
since 1960 and even presented a "Waiver
of Rights" executed by Olar wherein he
renounced in their favor his rights and
participation over the lot. Spouses Capitle
then filed before the Municipal Agrarian
Reform Officer a petition for cancellation of
the CLOA issued to Olar, claiming that they
are the new farmer-beneficiaries as shown
by the "Waiver of Rights" executed by Olar
In the presence of the Brgy. Chairman. Can
the Spouses Capitle can. be considered as
farmer-beneficiaries of the subject lot?
A: No. Spouses Capitle's argument that "it
would be absurd for Olar to bequeath his
propertyto his estranged wife not to a relative
who had indeed helped him in tilling the
propertyandtook good care of his needs," is a
virtual admissionthat their possession was not
in the concept of owners, they having merely
"helped" in tilling the lot, thereby
acknowledging that Olar was the actual
possessor and tiller. CA is correct in saying
that no amount of possession under whatever
claim(actual tilling and actual possession) can
clothe petitioner-appellants with any lawful
right over the questioned property. It simply
establishedthe fact that petitioners-appellants'
claim could in no way legally stand against
Cristobal Olar, whose title under the CLOA
cannot be overthrown or supplanted by some
organizational resolution and/or barangay
attestations/certifications. (Spouses Capitle v.
Elbambuena Olar, G.R. No. 169193, Nov. 30,
2006, J. Carpio-Morales)
Q: What are the lands covered by CARP?
A: All public and private agricultural lands as
providedin Proclamation No. 131and EO No.
229 (regardless of tenurial arrangement and
commodity produced), incluaing other lands of
the public domain suitable for agriculture:
Provided, that landholdings of landowners with
a total area of 5 hectares and below shall not
be covered for acquisition and distribution to
qualified beneficiaries.(As amended by R.A.
9700)
Morespecifically,
250
1. All alienable and disposable lands of
the public domain devoted to or
suitablefor agriculture.
Note: No reclassificationof forest or
minerallandsto agriculturallandsshall
be undertakenafterthe approvalof this
Act until Congress,taking intoaccount
ecological, developmental and equity
considerations,shall have determined
by law, the specific limits of the public
domain
2. All lands of the public domain in
!!xcess to the specific limits as
determined by Congress in the
preceding paragraph;
3. All other lands owned by the
government devoted to or suitablefor
,agriculture;
4. All private lands devoted to or
suitable for agriculture regardless of
the agricultural products raisedor that
can be raisedthereon.
Note: A comprehensiveinventorysystemin
consonancewith the national land use plan
shall be institutedby the DAR in accordance
with the Local Government Code, for the
purposeof properlyidentifyingandclassifying
farmlandswithin 1yearfromeffectivityof this
Act, without prejudiceto the implementation
of the land acquisitionand distribution. (As
amended by R.A. 9700)
Q: What are the exempted and excluded
lands?
A:
1. Parks, wildlife, forest reserves,
reforestation, fish sanctuaries and
breeding grounds, watersheds and
mangroves.
2. Private lands used for prawn farms
andfishponds.
3. Lands used and found to be
necessary for national defense,
school sites and campuses, including
experimental farm stations operated
educational purposes, seeds and
seedlings research and pilot
production center, church sites and
convents, mosque sites and Islamic
centers, communal burial grounds
and cemeteries, penal colonies and
penal farms, government and private
research and quarantine centers and
all lands with 18%slope andover.
Q: What are the retention limits?
leaseholder.
A:
GR: 5hectares for the landowner
XPN: Provincial, city and municipal
government units acquiring private
agricultural lands by expropriation or other
modes of acquisition to be used for actual,
direct and exclusive public purposes, such
as:
1. roads and bridges
2. public markets
3. school sites
4. resettlement sites
5. local government facilities
6. public parks and barangay plazas or
squares, consistent with the approved
local comprehensive land use plan
Provided, that lands subject to CARP
shall first undergo the land acquisition
and distribution process of the
program:
Provided, further, That when these
lands have been subjected to
expropriation, the agrarian reform
beneficiaries therein shall be paid just
compensation. (As amended by R.A.
9700)
7.
3 hectares may be awarded to each
child of the landowner, provided:
a. at least 15 years of age
b. actually tilling or managing the
farm
Provided, that original homestead
grantees or direct compulsory heirs --
who still own the original homestead -
- shall retain the same areas as long
as they continue to cultivate said
homestead.
Q: Who has the right to choose area to be
retained?
A: It shall pertain to the landowner. Provided,
that in case the area selected for retention by
the landowner is tenanted, the tenant shall
have the option:
1. To remain or
2. Be a beneficiary in the same or
another agricultural land with similar
or comparable features.
The tenant must exercise this option within a
period of 1 year from the time the landowner
manifests his choice of the area for retention.
(Sec. 6)
Q: What is the retention limit exemption of
LGUs?
A: LGUs except the 8arangays can own
agricultural lands beyond the 5-hectare limit
set by CARL. This privilege is only applicable
to lands that will be used for public purposes
such as roads, bridges, public markets, school,
resettlement, LGU facilities, public parks and
barangay plazas.
Note: There are two limitations to this exemption:
1. The use of the land must be actual,
direct and exclusive; and
2. The use must be consistent with the
approved comprehensive land use
plan17. Moreover, if the land is covered
under CARP and the LGU wants to use
it for one of the public purpose
mentioned earlier then it must be
expropriated first and the farmers
therein must bejustly compensated.
Q: Constructed on respondent's parcel of
land are houses occupied by its workers.
Spouses Pasco used to work for
respondent until '87 when they ceased to
be Ee's of the respondent They were asked
to vacate the house they were occupying
but they refused, hence, respondent filed a
complaint for unlawful detainer against
them before the MTCC. Spouses Pasco
claimed that they built the house occupied
by them at their own expense and their stay
on the land was upon the tolerance of
respondent. MTCC ordered petitioners to
vacate the premises. After the
promulgation of the decision, the Municipal
Agrarian Reform Office sent a Notice of
Coverage and Field Investigation adviSing
respondent that its parcel of land is now
covered under RA. 6657 or CARL, and
inviting the presence of a representative to
a field lnvestlqation.
Can a person who has been identified by
the DAR as potential agrarian reform
benefiCiary may be ejected from the land
where he is identified as such, by the
landowner, who has already been notified
by the DAR of the coverage of his land by
the CARP?
Note: If tenant chooses to remain, he shall be
considered a leaseholder and shall lose his right
to be a beneficiary under this Act. In case the A: Yes. A Notice of Coverage does not ipso
tenant chooses to be a beneficiary in another facto render the land a land reform area. The
agricultural land, he loses his right as a owner retains its right to eject unlawful
UNIVERSITY OF SANTO TOMAS ~ 251
PacuCtad de < Der ecfzo Ci vi C . .'
possessors of his land, as what respondent did
in the present case.
As for the registration of petitioners as
potential CARP beneficiaries, the same does
not help their cause. As "potential" CARP
beneficiaries, they are included in the list of
those who may be awarded land under the
CARP. Nothing in the records of the case
shows that the DAR has made an award in
favor of petitioners. (Spouses Pasco vs. Pison-
Arceo Agricultural and Dev't Corp., G. R. No.
165501, Mar.2B, 2006, J. Carpio-Morales)
Q: Who are landless beneficiaries?
A: One who owns less than 3 hectares of
agricultural land.
Q:What are the modes of land acquisition?
A:
1. Voluntary offer to sell (VaS)
2. Compulsory acquisition;
Note: No more Voluntary Land Transfer (VLT)
after J une 30, 2009. (R.A. 9700). VLT has been
abused by the landowners to put people who are
not qualified or people who are loyal to them as
beneficiaries.
Q: What are the circumstances to be
considered in the determination of just
compensation?
A:
1. The cost of acquisition of the land
2. the value of the standing crop
3. The current value of like properties
4. Its nature
5. Actual use and income
6. Sworn valuation by the owner
7. Tax declarations
8. Assessment made by government
assessors
9. 70% of the zonal valuation of BIR,
translated into a basic formula by the
DAR subject to the final decision of
the proper court.
As additional factors:
1. Social and economic benefits
contributed by the farmers and the
farm workers and by government to
the property
2. Non-payment of taxes or loans
secured from any government
financing institution on the said land
252
Q: What are the modes of payment of
compensation to the land owner?
A: At the option of the landowner he shall be
paid in any of the following mode:
1. Cash payment, under the following
terms and conditions:
a. For lands above 50 hectares,
insofar as the excess hectarage
is concerned - 25% cash, the
balance to be paid in government
financial instruments negotiable
at any time.
b. For lands above 24 hectares and
up to 50 hectares - 30% cash,
the balance to be paid in
government financial instruments
negotiable at any time.
c. For lands 24 hectares and below
- 35% cash, the balance to be
paid in government financial
instruments negotiable at any
time.
2. Shares of stock in government-owned
or controlled corporations, LBP
preferred shares, physical assets or
other qualified investments in
accordance with guidelines set by the
PARC;
3. Tax credits which can be used against
any tax liability;
4. LBP bonds, which shall have the
following features:
a. Market interest rates aligned with
91-day treasury bill rates - 10%
of the face value of the bonds
shall mature every year from the
date of issuance until the 10th
year: Provided, That should the
landowner choose to forego the
cash portion, whether in full or in
part, he shall be paid
correspondingly in LBP bonds;
b. Transferability and negotiability.
Q: Virgilio Sindico, joined by his wife, filed
a civil case before the RTC of Iloilo City
against his first cousin Felipe Sombrea,
along with the latter'S wife, for Accion
Reinvindicatoria. After the defendants
received the summons, they filed a Motion
to Dismiss (MD) the complaint, alleging that
the RTC has no jurisdiction over their
person and that as the subject matter of the
case is an agricultural land which is
covered by the CARP of the government,
the case is within the exclusive original
jurisdiction of the DARAB in accord with
Sec. 50 of the CARL of 1988. To the MD,
the plaintiffs filed an Opposition alleging
that the case does not involve an agrarian
dispute, there being no tenancy
relationship or leasehold agreement with
the defendants. Does the DARAB have
original and exclusive jurisdiction over
UNIVERSITY OF SANTO TOMAS' (.<loA. 253
PacuCtaa ae (] )er ecl i o CiviC '.'
Q: May lands acquired under the CARL be
sold, transferred or conveyed?
A:
GR: Lands acquired by beneficiaries under
this Act may not be sold, transferred or
conveyed.
XPN:
1.
2.
3.
4.
Through hereditary succession, or
To the government, or
To the LBP, or
To other qualified benefieiaries .i ot a
period of 10 years: ~
Provided, however, that the children or the
spouse of the transferor shall have a right to
repurchase the land from the government or
LBP within a period of 2 years.
Q: Is the decision of DAR immediately
executory?
A: Yes, Notwithstanding an appeal to the
Court of Appeals, the decision of the DAR
shall be immediately executory, except a
decision or a portion thereof involving solely
the issue of just compensation.
Q: When will DAR decide the case or
controversy?
A: Any case or controversy before it shall be
decided within 30 days after it is submitted for
resolution.
Only 1 motion for consideration shall be
allowed.
Any order, ruling or decision shall become final
after the lapse of 15 days from receipt of a
copy thereof.
cases involving agricultural lands
irrespective of the presence of tenancy
relationship?
A: No. The allegations in petitioners' compia,
show that the action is one for recovery f
possession, not one which involves a
agrarian dispute. It is the RTC which has
jurisdiction over it and not DARAB. T e
respondents' only basis in assailing the
jurisdiction of the trial court is that the subj :
matter of the case is an agricultural land and
that they do not deny at all the allegation of e
complaint of petitioners that there is
tenancy or leasehold agreement betwee
them; it unmistakably shows that there is n
agrarian dispute to speak of. (Sindico, vs
Gerardo Diaz;, G.R.No. 147444, Oct. 1, 2004,
J . Carpio-Morales)
Academics Committee
Chai r per son: Abraham D.Genuino _:
Vi ce-Chai r Jar Academi cs: J eanrue A.Laurenuno
Vi ce-Chai r j or Admi n &F i nance: Aissa CelineH. LulJ 2.
Vi ce-Chai r Jar L ayout &Desi gn: Loise Rae G.~ava,
Labor LawCommittee
Subj ect H ead' Lester J ay AlanE. Flores -
Assi stant Subj ect H ead' Domingo B.Diviva -
Members:
Rene FrancisP. Bar a
Diane Camilla R.Bo'2
Maria Kristina L.Dacayo-Garm
ChristianNino/\.Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelle C.Lee
]emuel PaoloM. Lobo
Andrew W.Montesa
SOCIAL LEGISLATION: ACT AGAINST CHILD LABOR
Q: What is child labor?
A: Any work or economic activity performed-by
a child that subjects him or her to any form of
exploitation or is harmful to his or her health
and safety or physical, mental or psychosocial
development.
Q: Who is a working child?
A: Any child engaged as follows:
1. When the child is below 18 years of
age in a work or economic activity
that is not child labor; or
2. When the child is below 15 years of
age:
a. 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
b. In public entertainment or
information
Q: When may the State intervene in behalf
of the child?
A:
1. The parent, guardian, teacher or
person having care or custody of the
child fails or is unable to protect the
child against abuse, exploitation and
discrimination; or
2. When such acts are committed
against the child by the said parent,
guardian, teacher or person having
care and custody over the child
Q: Can children below 15 years of age be
employed?
A:
GR: No.
XPN:
1. When a child works directly under the
sale responsibility of his/her parents
or legal guardian and where only
members of his/her family are
employed, Provided that:
a. His employment neither
endangers his life, safety, health
and morals, nor impairs his
normal development; and
b. The parent or legal guardian
shall provide the said minor child
with the prescribed primary
and/or secondary education
254
2. Where the child's employment or
petti ci peti on in public entertainment
or information through cinema,
theater, radio, television or other
forms or media is essential, Provided:
a. The employment contract is
concluded by the child's parents
or legal guardian with the
express agreement or the child
concerned, if possible, and the
approval of DOLE
b. The following requirements are
complied with:
i. The Er shall ensure
protection, health, safety,
morals and normal
development of the child
ii. The Er shall institute
measure 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
iii. The Er shall formulate and
implement, subject to the
approval and supervision
of competent authorities, a
continuing program for
training and skills
acquisition of the child
iv. The child is provided with
at least mandatory
elementary or secondary
education
Q: What is the limitation on the hours of
work of a working child?
A: If the child is:
1. Below 15 years of age - not more
than 20 hours a week and not more
than 4 hours a day
Not allowed to work between
8:00 pm - 6:00 am
2. At least 15years of age but below 18
years of age - will not exceed 8 hours
a day or 40 hours a week
Not allowed to work between
10:00 pm - 6:00 am
Q: What are the worst forms of labor?
A:
1. All forms of slavery (Anti-Trafficking
of 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;
2. The use, procuring, Qffering. or
exposing of a child pornographyorfor
pornographic performances;
3. The use, procuring, offering or
exposing of a child for illegal or illicit
activities, including the production
and trafficking of dangerous drugs
and volatile substances prohibited
under existing laws;
4. Work which, by its nature or
circumstances in which it is carried
out, is hazardous or likely to be
harmful tothe health, safetyor morals
of children ..
Q: Who can file a complaint for unlawful
acts committed against children?
A:
1. Offended party
2. Parents or guardians
3. Ascendants or collateral relatives
within the 3'd degree of consanguinity
4. Officer, social worker or
representative of a licensedchild-
caring institution
5. Officer or social worker of DSWD
6. Barangay chairman of the place
where the violation occurred, where
the child is residingor employed
7. At least 3concerned, responsible
citizens where the violationoccurred
Q: Which courts have jurisdiction over
offenses punishable under R.A. 9231?
A: The Family Courts shall have original
jurisdiction over all cases involving offenses
punishable underthis Act
Academics Commi ee
Chai r pmon: Abraham D. Gen
Vi ce-Chai r for Academi cs: ] eannie A. Laurenc.o;
Vi ce-Chai r for Admi n &F i nance: Aissa Celine H. u=
Vi ce-Chai r for L ayOl i t &Desi gn: Loise Rae G. _.:;:,'"-
Labor Law Committee
Subj ect H ead' Lester] ay Alan E. Flores ::-=
.Assi staat Subj ect H ead' Domingo B. Diviva --
Members.
Rene Francis P. B:e.~
Diane Camilla R.Bcr i
Maria Kristina L.Dacavo-Garcu
Christian Nino _\. .l2"
Angelo .Dicker
Genesis R.Fulgenc.c
]eanelle C ~
lemuel Paolo -!.:......~<
Andrew \'C_1or::e;~
Maria Maica Angelika Rorruz
UNIVERSITY OF SANTO TOMAS' ~........ 255
PacuCtaa ae ([ )er ecfw Ci Vi C -~-
SOCIAL LEGISLATION: MAGNA CARTA OF WOMEN
Q: What is the policy of the State in
enacting the MeW?
A: The State shall endeavor to develop plans,
policies, programs, measures, and
mechanisms to address discrimination and
inequality in the economic, political, social, and
cultural life of women and men.
Q: What is discrimination against women?
A: Any gender-based distinction, exclusion, or
restriction which has the effect or purpose of
impamng or nUllifying the recognition,
enjoyment, or exercise by women, irrespective
of their marital status on a basis of equality of
men and women, of human rights.
It includes any act or omission, including by
law; policy, administrative measure, or
practice, that directly or indirectly excludes or
restricts women in the recognition and
promotion of their rights and their access to
and enjoyment of opportunities, benefits, or
privileges.
Q: When is a measure or practice of
general application considered as
discrimination against women?
A: A measure or practice of general
application is discrimination against women if it
fails to provide for mechanisms to offset or
address sex or gender-based disadvantages
or limitations of women, as a result of which
women are denied or restricted in the
recognition and protection of their rights and in
their access to and enjoyment of opportunities,
benefits, or privileges; or women, more than
men, are shown to have suffered the greater
adverse effects of those measures or
practices.
Note: Discrimination compounded by or
intersecting with other grounds, status, or
condition, such as ethnicity, age, poverty, or
religion shall be considered discrimination against
women under this Act.
Q: What are special leave benefits for
women?
A: A woman Ee having rendered continuous
aggregate employment service of at least 6
months for the last 12 months shall be entitled
to a specialleave benefit of 2 months with full
pay based on her gross monthly compensation
following surgery caused by gynecological
disorders. (Sec. 18)
256
Academics Committee
Labor LawCommittee
. Subj ect H ead' Lester J ayAlanE.FloresII
Members:
ChristianNinoA. Diaz
AngeloS.Diokno
Genesis R.Fulgencio
J eanelle C.Lee
J emuel PaoloM.Lobo
Andrew W.Montesa
Maria Maica Angel.ikaRoman
OVERVIEW OF THE
PHILIPPINE LABOR DISPUTE SETTLEMENT PROCEDURE
ARTICLE
217 of the
Labor Code
NLRC
: .
MONEY CLAIMS
under
: Section 10 RA
: 8042 as
: amended :
; ~
(Commission Level)
~
~
~)
Injunction J .
- " TI
................
. .
: Labor Stds
: Art. 129 of
: LC r:I
L ~

Inter-Intra
Union
Disputes
.. -------- ..
I Representation I
I Issues ri --
~- - - - - - L2J
Labor Stds.
Art. 128 (b)
LC
Notices of Strike or
Lockout, other disputes for
preventive mediation
I! I
r----I
I
Unresolved GrievanceS
tb
other disputes by
L
Parties' agreement
___ 3
Pacu{ tati ti e l Der ecno CiviC
M... ~
._ 257
ARTICLE 217 of
the Labor Code
LABOR
ARBITER
(RAB)
Under Article 217 of the Labor Code as amended, Labor
Arbiters shall have original and exclusive jurisdiction to hear
and decide the following cases involving all workers, whether
agricultural or non-agricultural:
1.Unfair Labor Practices;
2.Tenrnination Disputes;
3.lf accompanied with a claim for reinstatement, those cases
that workers may file involving wages, rates of pay, hours of
work and other terms and conditions of employment;
4.Claims for actual, moral and exemplary and other forms of
damages arising out of ER-EE relations;
5.Cases arising from any violation Art. 264 of the Labor Code,
including questions involving the legality of strikes and
lockouts; and
6. Except claims for Employees Compensation, Social
Security, Medicare and maternity benefits, and all other claims
arising from EE-ER relations, including those of persons in the
domestic or household service, involving an amount
exceeding P5,OOOregardless of whether accompanied with a
claim for reinstatement.
This Article enumerates the cases falling under "original and
exclusive" jurisdiction of labor arbiters. This gives the
impression that none but a labor arbiter can hear and decide
the six categories of cases listed. But this is not really so. Any
or all of these cases can, by agreement of the parties, be
presented to and decided with finality by a voluntary arbitrator
or a panel of voluntary arbitrators (see Articles 261-262).
(AZUCENA, Everyone's Labor Code 2001)
NOTE:
RAB-Regional Arbitration Branches
National
Conciliation and
Mediation
Board
258
1
SUPREME
COURT
MONEY CLAIMS
under
Section 10 RA 8042 ----+
as amended
R.A. 8042 Migrant Workers and Overseas
Filipinos Act of 1995 as amended by R.A.
10022.
Section 10 of RA 8042 added to the exclusive
jurisdiction of the labor arbiters money claims
of Overseas Filipino workers arising from
violations of their employment contract against
foreign employers through their local
recruitment aqency.
Section 7 (R.A. 10022). Section 10 of
Republic Act No. 8042, as amended, is hereby
amended to read as follows:
"SEC. 10. Money Claims. - Notwithstanding
any provision of law to the contrary, the Labor
Arbiters of the National Labor Relations
Commission (NLRC) shall have the original
and exclusive jurisdiction to hear and decide,
within ninety (90) calendar days after the filing
of the complaint, the claims arising out of an
employer-employee relationship or by virtue of
any law or contract involving Filipino workers
for overseas deployment including claims for
actual, moral, exemplary and other forms of
damage. Consistent with this mandate, the
NLRC shall endeavor to update and keep
abreast with the developments in the global
services industry ... n
NOTE:
RAB-Regional Arbitration Branches
1
SUPREME
COURT
UNIVERSITY OF SANTO TOMAS 'C~~. 259
PacuCtaa ae ([ )er ecfi o Ci vi ! .~.
Unresolved Grievances, Other
disputes by parties' agreements
Voluntary Arbitratioll Machinery
The voluntary arbitration machinery has authority over unresolved
grievances arising from the interpretation or implementation of collective
bargaining agreements and those arising from the interpretation or
enforcement of company personnel policies (Art. 261, p.o. 442 as
amended).
Unresolved grievances involving distortion of wages (Art. 124, P.O. 442)
and the productivity and incentives program under Section 4 (b) R.A.
6971. Other labor disputes, including those involving strikes may be
referred to voluntary arbitration by agreement of the parties.
ARTICLE 262. J URISDICTION OVER OTHER LABOR DISPUTES. The
Voluntary Arbitrator or panel of Voluntary Arbitrators, upon agreement
of the parties. shall hear and decide all other labor disputes
including unfair labor practices and bargaining deadlocks.
Art. 262 of the Labor Code provides that upon agreement of the parties,
the Voluntary Arbitrator can hear and decide all other labor disputes,
including termination disputes which ordinarily fall under the jurisdiction
of the Labor Arbiters under Art. 217 of the Labor Code. (Apalisok v.
RPN, GR No. 138094, May 29,2003, J. Carpio-Morales).
Article 217 (c) should be read in conjunction with Article 261 of the Labor
Code which grants to voluntary arbitrators original and exclusive
jurisdiction to hear and decide all unresolved grievances arising from the
interpretation or implementation of the collective bargaining agreement
and those arising from the interpretation or enforcement of company
personnel policies. It can thus be deduced that only disputes involving
the union and the company shall be referred to the grievance machinery
or voluntary arbitrators. (Maneja v. NLRC, G.R. No. 124013 June 5,
199B).
In San Miguel Corp. v. NLRC, G.R. No. 108001, March 15, 1996,
Termination disputes do not necessarily involve enforcement or
interpretation of personnel policies because they are broad and long-
term statements. As a rule, therefore termination disputes should be
lodged with a Labor arbiter. But the case may be brought to voluntary
arbitration if the parties, by virtue of Art. 262, state in unequivocal
language that they agree to submit the termination dispute to voluntary
arbitration. Even a ULP case can, by agreement of the parties, be
brought before voluntary arbitration. (Azucena, Everyone's Labor Code,
2001)
A Voluntary Arbitrator is a quasi-judicial instrumentality; hence, a petition
for certiorari under Rule 65 of the Rules of Court will lie where a grave
abuse of discretion or an act without or in excess of jurisdiction of the
voluntary arbitrator is shown. The petition may be filed with the Court of
Appeals.
NCMB
The NCMB cannot adjudicate but the it can recommend to the parties
that the dispute be submitted to voluntary arbitration because the policy
statement of the law is voluntary means of dispute settlement
260 ~eam:_
Arbitrator
COURT
OF
APPEALS
Conciliation
and
Labor Standards
Art. 128 (b) LC
Regional
Office
Article 128(b): Enforcement of Labor Standards Laws
Art, 128(b) of the LaborCode allows the Secretaryof Labor
and employment, usually through an authorized
representative, to inspect places of employment and, if
necessary, issue compliance orders and writs of execution
to enforce "labor standards provisions" of the "labor laws".
Orders issued under Art. 128 (b) by representatives of the
Secretaryof Labor andEmployment maybe appealedtothe
Secretary of Labor and Employment himself. Decisions of
the Secretary of Labor and Employment may then be
brought beforethe CA andthereafter, tothe SC.
The authority of the DOLE Secretary underArt. 128may be
exercised regardless of the monetary value involved. The
Secretary of Labor and employment may even order the
stoppage of work or suspension of operations of the
inspected establishment or parts of it. If the employer is at
fault, he may be ordered to pay the employees' wages
during the work stoppage or suspension of operations. The
requirementof due process must be observed.
InAboitiz Shipping Corp. v. Dela Serna (GR No. 88538,
April 25, 1990), it was heldthat a Regional Directorof Dole
has the power toorder rectificationof LaborStandards
violationevenif such violationis not mentionedinthe
employee's complaint.
1
SUPREME
COURT
UNIVERSITY OF SANTO TOMAS' ~~ 261
Pacu{ taa ae (/)er ecF i o CiviC '.
Labor Standards
Art. 129 of LC
Article 129of the LC: Recovery of Wages, Simple
Money claims and Benefits
The Regional Director's authority under Art. 129 is
subjecttofour requisites namely:
1.Theclaimis presentedby an employee or byperson
employedin domestic or householdservice or a house
helper.
2.Theclaimarises fromER-EE relations.
3. The claimantdoes not seek reinstatement.
4.The aggregate money claim of each employee or
house helperdoes not exceedP5000.
If there is a claimfor reinstatement or if the claimant's
demand exceeds 'P5,OOO, the labor arbiter has
jurisdiction over the case pursuant to Art. 217 (6),
except claims for employees' compensation, social
security, Medicare, Phil health and maternity benefits.
Even as regards labor arbiter, however, Er-Ee relation
is a pre-requisiteas basis of the claim.
A decision rendered under this article, being
adjudicatory, is appealabletothe NLRC. (AZUCENA)
Note:
Under Art. 129 of the LC, the Regional Director or a
hearing officer of the DOLE hear and decide disputes
involving the recovery of wages for as long the
aggregate claim does not exceed P5000 and
reinstatement is not sought. Designed to expedite
enforcement of "simple money claims", hearings are
summary in nature and decisions may be appealed to
theCommission-level of the NLRC. SUPREME
COURT
262
Inter-Intra Union Disputes
Generally, Intra-Inter Union disputes are heard in
administrative proceedings by the regional offices
or the BLR, depending on the labor organization
concerned. DO No. 40-03 provides that inter-intra
union disputes are resolve by Med-Arbiters in the
regional offices with the exception of petitions for
cancellation of registration of labor organizati~ns
and petitions for deregistration of CBA's which are
resolved by the appropriate Regional Director or
her appointed hearing officer.
The decisions of the Med-Arbiter and the Regional
Director may be appealed to the BLR. The
decisions of the Bureau Director in the exercise of
her original jurisdiction may be appealed to the
Office of the Secretary.
Note:
The rules allow one motion for reconsideration and
thereafter, the decision of the Bureau Director or
the Secretary of Labor and Employment will be final
and executory, but this is without prejudice to a
petition for certiorari (Rule 65) witb the CA.
Decisions of the CA may thereafter be brought to
the SC by petition for review on certiorari (Rule 45).
Inter-Intra Union
Disputes
BLR
Director
Section 5 (Rule XI, DO 40-03)
Where to file:
Complaints or petitions involving:
1. Labor unions with independent registrations, chartered
locals workers associations, its officers or members
shall be filed with the Regional Office that issued its
certificate of registration or certificate of creation of
chartered local.
2. Federations, national unions, industry unions, its
officers or member organizations shall be filed with the
Bureau.
Petitions for cancellation of registration of labor unions
with independent registrations, chartered locals, worker's
associations and petitions for deregistration of collective
bargaining agreements shall be resolved by the Regional
Director. He/she may appoint a Hearing Officer from the
Labor Relations Division.
Other Inter-Intra union and related labor relations
disputes shall be heard and resolved by the Med-Arbiter
in the Regional Office.
Complaints or petitions involving federations, national
unions, industry unions, trade union centers and their
chartered local, affiliates or member organizations shall
be filed with the Regional Office or the Bureau. The
complaint or petition shall be heard and resolved by the
Bureau.
When two or more petitions involving the same parties
and the same causes of action are filed, the same shall
be automatically consolidated.
SUPREME
COURT
Office
ofthe Secretary
Pacu{ taa,ae c] )er ecl i o Ci ' Vi {
Note:
An instance which cannot be appealed is Section 17, Rule VIII of Dept. Order No. 40-
03 (2003) on certification elections which provides that the order granting the conduct
of a certification election in an unorganized establishments shall not be subject to
appeal. Any issue arising therefrom may be raised by means of protest on the conduct
and results of the certification election. .
Settlement of Representation Issues Under Art. 256 of the Labor
Code
Representation Issues are heard and resolved by Med-Arbiter of the
appropriate regional office. The decisions of the Med-Arbiters may be
appealed to the Secretary of labor and employment (see Art. 259)
whose decisions in turn may be questioned before CA (Rule 65) and
thereafter the dispute may be brought by any party to the SC (Rule
45).
Representati on
Issues
SUPREME
COURT
National Conciliation and Mediation Board (NCMB) involving
notices of strike or lockout arising from collective
bargaining deadlocks or allegations of unfair labor
practices.
The NCMB is a dispute-resolution arm under the administrative
supervision of the Secretary of Labor and Employment. Its main
task is to help settle labor disputes to prevent actual work
stoppages (Azucena, Everyone's LaborCode, 2001).
After the receipt of Noticeof strike/lockout, the NCMB conciliator-
mediators call the parties to conciliation conferences. They are
notjudges andtherefore th~y cannot re",~erver~icts.
They can also urge submission of the dispute to preventive
mediation or arbitration. Under either proceedings a strike or
lockoutis withheld.
If there is noagreement, the Secretaryof Labor andEmployment
may interveneat anystage.
The Secretary of Labor and Employment may exercise his
authority under Article 263 (g) of the Labor Code to assume
jurisdiction over the labor dispute or to certify the same to the
Commission for compulsory arbitration when in his opinion,
there exist a labor dispute causing or likely to cause a
strike/lockout in an industry indispensable to national
interest. (See Art. 263 (g) of the Labor Code)
A notice of strike or lockout, upon agreement of parties, may be
referred to alternative modes of dispute resolution, including
voluntaryarbitration. (See Section 9, Rule XXII, DO40-03).
Not all notices of strikes or lockouts are assumed / certified by
the Secretaryof Laborand Employment.
There are cases which are initially subject of Notice of strike or
lockout but are referred to NLRC for compulsory arbitration, like
for instanceULP complaints.
Disputes initially subject of a notice of strike or lockout may be
brought underArt. 217of the LaborCode.
Note:
Under Art. 263 (g), disputes certified by the Secretary of Labor
and Employment under her authority to assume jurisdiction are
brought directlyto the NLRC (Commission-Level).
Notices ofStrike or
Lockout, other dispute
for preventive
mediation
SUPREME
COURT
Art. 263 (g)
Secretary
tf' acu{ taa de CDer ecl i o Ci vi C
~i~ 265
Article 218(e) of the Labor Code INJ UNCTION
Petitions for injunction are initially brought to and decided at the
commissionlevel.
RuleX, Sections 1 and 2 of the 2005 Revised Rules of the NLRC,
providesthat:
Injunction in Ordinary Labor Disputes. - A preliminaryinjunction
or restrainingorder may be granted bythe Commissionthrough its
Divisionspursuant to the provisions of paragraph (e) of Article 218
of the Labor Code, as amended, when it is established on the
basis of the sworn allegations in the petition that the acts
complained of involving or arising from any labor dispute
before the Commission, which, If not restrained or performed
forthwith, may cause grave or irreparable damage to any
. party or render ineffectual any decision in favor of such party.
Injunction in Strikes or Lockouts. - A preliminary or permanent
injunction may be granted by the Commission only after hearing
the testimony of witnesses and with opportunity for cross-
examination in support of the allegations of the complaint or
petition made under oath, and testimony by way of opposition
thereto if offered. and only after a finding of fact by the
Commission:
a) That prohibited or unlawful acts have been
threatened and will be committed and will be
continued unless restrained, but no injunction or
temporary restraining order shall be issued on account
of any threat, prohibited or unlawful act, except against
the person or persons, association or organization
making the threat or committing the prohibited or
unlawful act or actually authorizing or ratifyingthe same
after actual knowledgethereof.
b) That SUbstantial and irreparable injury to
petitioner's property will follow;
c) That as tc. each itemof relief to be granted, greater
injury will be inflicted upon the petitioner by the
denial of relief than will be inflicted upon
respondents by the granting of relief;
d) That petitioner has no adequate remedy at law;
and
e) That the public officers charged with the duty to
protect petitioner's property are unable or unwilling
to furnish adequate protection.
266
INJ UNCTION
i NLRC
SUPREME
COURT
Criminal Action for Illegal Recruitment
(Section 5, R.A. No. 10022)
Prosecutor's
Office
Filing of Complaint-
Affidavit with
Prosecutor's Office
(To Conduct
Preliminary
Investigation)
Ifthe Resolution of the
Prosecutor finding
probable cause for
prosecution of illegal
recruitment isnot
elevated for review with
the Secretary of J ustice,
the Prosecutor will file
the information withthe
Regional Trial Court
for trial.
Any Adverse decision of
the Prosecutor may be
appealed to the
Secretary of J ustice
(DOJ ), ,) ,
CA
CA
Adverse decision of
the _Secretary of
J ustice may be
appealed to the CA
by petition for
certiorari under Rule
65.
Finding of conviction by the
RTC may be elevated tothe
CA by Ordinary Appeal or
by writ of error under Rule
41.
The case may also be
elevated to the CA by
petition for certiorari
under Rule 65if proper
grounds for it exists.
sc
Finding of conviction by
the RTCmay be elevated
tothe SCby petition for
review oncertiorari under
Rule 45,
The case may also be
elevated to the SC by
petition for certiorari
under Rule 65 if
proper grounds for it
exists
Section 9 ofR.A. No. 8042
Section 5of R.A. No. 10022
Who can file an action for Illegal Recruitment?
In the filing of cases for illegal recruitment or any of the prohibited
acts under this section, the Secretary of Labor and Employment,
the POE A Administrator or their duly authorized
representatives, or any aggrieved person may initiate the
corresponding criminal action with the appropriate office.
VENUE:
A criminal action arising from illegal
recruitment as defined herein shall be filed
with the Regional Trial Court of:
1.The province or city where the offense
was committed ;or
SC
Decision of the CA
may be appealed to
the Supreme Court
by petition for
revi ew on certi orari
under Rule 45.
For this purpose, the affidavits and testimonies of operatives or
personnel from the Department of Labor and Employment, POEA
and other law enforcement agencies who witnessed the acts
constituting the offense shall be sufficient to prosecute the accused.
2.Where the offended party actually
resides at the same time of the
commission of the offense.
In the prosecution of offenses punishable under this section, the
public prosecutors of the Department of J ustice shall collaborate
with the anti-illegal recruitment branch of the POEA and, in certain
cases, allow the POEA lawyers to take the lead in the prosecution.
The POEA lawyers who act as prosecutors in such cases shall be
entitled to receive additional allowances as may be determined by
the POEA Administrator.
The filing of an offense punishable under this Act shall be without
prejudice to the filing of cases punishable under other existing laws,
rules or regulations."
Provided: The court where the criminal
action is first filed shall acquire jurisdiction
to the exclusion of other courts.
Provided further, that the aforestated
provisions shall also apply to those
criminal actions that have already been
filed in court at the time of the effectivity of
this Act.
Pacu{ taa de CDer ecl i o Ci oi !

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LABOR STANDARDS

Art. 263 (g)

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