This is but a glance at the most important and the latest labor law principles.

This reviewer is a product of the great mind of Atty. Marlon Manuel and may act as your pre-week reviewer.. LABOR LAW PRINCIPLES GENERAL PRINCIPLES What is/are the Constitutional basis/es for the protection of labor? Article I, Sec. 18: The State affirms labor as a primary social economic force. It shall protect the rights of workers and promote their welfare. Article XIII, Sec. 3: The State shall afford protection to Labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities. What shall the State guarantee to laborers under the Constitution? Self-organization Collective bargaining and negotiations Peaceful concerted activities including the right to strike Security of tenure Humane Conditions of work Living Wage Participation in policy and decision-making processes What shall it promote? Principle of shared responsibility between workers and employers Preferential use of voluntary modes in settling disputes Enforce mutual compliance

What shall it regulate? Relations between labor and capital (recognizing the right of labor to its just share in the fruits of production and the right of enterprises on reasonable returns) What is the nature of labor relations? They are not merely contractual. They are so impressed with public interest that they must yield to the common good. (Art. 1700, Civil Code) What is the basis for resolving doubts in favor of labor? Art. 1702 of the Civil Code and Art. 6 of the Labor Code. Moreover, doubts arising from conflicting evidence must be resolved in favor of labor (Prangan v. NLRC, 289 S 142) Management Prerogatives A line must be drawn between policies which are purely business-oriented and policies which affect workers rights. Workers have the right to participate in matters affecting their rights (Phil. Airlines v. NLRC). PRE-EMPLOYMENT Protection is not just promotion of full employment. humane (PASE v. Drilon). Employment must be decent, just and

Migrant Worker a person who is to be engaged, is engaged, or has been engaged in a remunerated activity in a state of which he is not a legal resident may only be deployed where the rights of migrant Filipino workers are protected

Recruitment - is committed by doing any of the following acts: canvassing, enlisting, contracting, transporting, utilizing, hiring, procuring workers, & includes referrals, contract services, promising or advertising for employment, locally or abroad, whether for profit or not. Offer or promise of employment for a fee to 2 or more persons deemed engaged in recruitment. This 2-person rule is not a requirement but a factor that gives rise to a presumption (People v. Panis). Procuring tickets, passports, visa for another, without more, is not recruitment (Darvin v. CA). ILLEGAL RECRUITMENT LABOR CODE MIGRANT WORKERS ACT (RA 8042) Person recruits without any license or a. person recruits without license or authority authority OR b. person who has license recruits and commits any of the prohibited acts

VENUE: R.T.C. where offense committed or where offended resides at the time of commission Mandatory repatriation if actual age falls below minimum age A person is guilty of illegal recruitment only when s/he gives the impression that s/he has the power to send workers abroad (People v. Diaz). Recruiters liability is not terminated by the termination of the agency agreement between the principal and the recruiter. Obligations of recruiter and principal are coterminous with the employment contract. In fact, their obligation/liability do not end upon the actual date of the contracts expiration but upon the repatriation of the worker. (Interorient vs. NLRC, 261 S 757) Recruiter and principal are solidarily liable to the worker. Alterations of contracts that improve the benefits are not prohibited. Power to suspend or cancel license is concurrently vested with POEA and SOLE (Trans Action Overseas Corp. v. Sec. Of Labor) ROLES OF THE FOLLOWING AGENCIES UNDER RA 8042: D.F.A. Makes representation with foreign authority and extends immediate assistance including repatriation D.O.L.E. Sees to it that Labor and Social Welfare laws in the foreign countries are fairly applied, grant legal assistance and referral to proper medical centers P.O.E.A. Regulates private sector participation in recruitment and implements system for promoting or monitoring overseas employment O.W.W.A. Provides the Filipino migrant worker and his family all the assistance they may need in enforcing contractual obligations

Human Resources Development Non-resident aliens cannot be employed in the Philippines without a permit from the DOLE and without a determination that no person in the Philippines is competent, able and willing to perform the services desired. Apprenticeship without TESDA approval is not valid. Handicapped worker is a person whose earning capacity is impaired by age, or physical or mental deficiency or injury. Thus, a person who suffers from a disability is not necessarily a handicapped worker, if his earning capacity is not impaired. If a disabled person is qualified for the position as an able-bodied person, s/he is entitled to full compensation (not to 75%).

EMPLOYER-EMPLOYEE RELATIONSHIP

4-fold test: hiring, wages, firing, control Control test is the most important. This means control over the manner of doing the work, not just over the end desired. Absence of control is indicative of independent contractorship. The element of control is absent where a person who works for another does so more or less at his/her own pleasure and is not subject to definite hours or conditions of work and in turn is compensated according to the result of his efforts and not the amount thereof. Note, however, that a person with no definite hours of work or a person who is paid on a per result basis can still be an employee. Payment of compensation by way of commission does not militate against the existence of employer-employee relationship. Wage can be on commission basis. Mere existence of the right to control is enough. It need not be actually exercised. The fact that the workers work in the premises of the company can be an indicator of the existence of the right to control. Not all rules are equivalent to control which will give rise to an employer-employee relationship. Rules that merely serve as guidelines towards the achievement of the mutually desired result without dictating the means or methods to be employed in attaining it do not amount to control. They aim only to promote the result and therefore do not create an employer-employee relationship. Existing economic conditions test -- the inclusion of the worker in the payroll, payment of SSS, can also be considered in determining the existence of employer-employee relationship. Employer-employee relationship is determined by law and its existence cannot be negated by expressly repudiating it in a contract.

Job-contracting Contractor carries on an independent business and undertakes contracted work on his/own account, under his own responsibility, according to own manner and method of work, free from the control and direction of the principal. Contractor must have either substantial capital OR investment in the form of tools, equipment, machineries, work premises. Tools and equipment must be directly related to the contracted job.

Substantial capital or investment refers to the adequacy of resources actually and directly used by the contractor in the performance or completion of the job, work, or service contracted out. It excludes all capital and investment the contractor may have which are not actually and directly used in the conduct of its business, or any gratuitous assistance, financial or otherwise, it may have received from the principal. It is not enough to show substantial capitalization or investment to be considered a legitimate independent contractor. Several other factors should be considered including but not limited to whether the contractor is carrying on an independent business; the nature and extent of the work; the skill required; the term and duration of the relationship; the right to assign the performance of specified pieces of work; the control and supervision of the workers; the power of the employer with respect to hiring, firing and payment of workers of the contractor; the control of the premises; the duty to supply premises, tools, appliances, materials and labor; and the mode, manner and terms of payment. Legitimate job-contractor is the direct employer; the principal is the indirect employer. In the event that the contractor fails to pay the wages of the employees, the principal shall be solidarily liable with the contractor to the extent of the work performed under the contract. This liability of the principal extends only to the period during which the employees were working for the principal. Even in the absence of an employer-employee relationship, the law itself establishes one between the principal and the employees of the contractor for a limited purpose i.e. in order to ensure that the employees are paid the wages due them. The solidary liability of the principal does not extend to the liability of the contractor for illegal dismissal (separation pay and backwages) if there is no fault on the part of the principal, i.e., if the principal did not conspire with the contractor in the acts giving rise to the illegal dismissal. (Rosewood v. NLRC, 290 S 409, 1998) Job-contractor must register with the DOLE and must submit contract with principal to the DOLE. (D.O. 10) Workers term of employment must be coterminous with the term of contract between the principal and the contractor. The contract must assure rights of workers. (DO 10) Labor-only contracting

Contract is not legitimate contracting arrangement. Contractor has no substantial capital or investment and the workers perform activities that are directly related to the business of the employer. Contractor is considered as agent of the principal. Principal is the direct employer. Miscellaneous

The relationship between owners of jeeps and taxicabs, on one hand, and their drivers, on the other hand, under a boundary system, is an employer-employee relationship. Art. 280, which distinguishes between regular and casual employees, is not the yardstick for determining the existence of an employment relationship. Art. 280 does not apply where the existence of an employment relationship is in dispute. No particular form of proof is required to prove the existence of an employer-employee relationship. Any competent and relevant evidence may show the relationship. If only documentary evidence would be required to demonstrate that relationship, no scheming employer would ever be brought before the bar of justice. Any woman permitted or suffered to work, with or without compensation, in any night club, bar or similar establishment, under the effective control or supervision of the employer for a

substantial period of time shall be deemed an employee of such establishment for labor and social legislation. (Art. 138) A homeworkers employer is deemed to be the person who, for his/her own account or benefit, or on behalf of another: (1) delivers or causes to be delivered, goods, articles or materials to be processed or fabricated in or about a home and thereafter to be returned or disposed of or distributed in accordance with his/her directions; or (2) sells the good, articles or materials to be processed or fabricated in or about a home and then rebuys them after such processing or fabrication, himself/herself or through another person. (Art. 155) Employee includes one whose work has ceased as a result of a current labor dispute or due to ULP who has not obtained any other substantially equivalent and regular employment. (Art. 212-f) A student who works for a school in exchange for the privilege to study free is not an employee provided s/he is given a real opportunity to finish his/her chosen course. CLASSES OF EMPLOYEES Employment status is determined by law, not by contract. Regular employee Employee who performs work that is usually necessary or desirable to the usual business of the employer. There is a reasonable connection between the activity performed and the business of the employer. Mode of compensation of employee is not determinative of status/class. Thus, piece-rate workers can be regular employees. (Labor Congress v. NLRC, 290 S 509, 1998) Continuity of employment is not the determining factor. Thus, waiting time does not negate regular employment. (Caudanetaan v. Laguesma, 286 S 401, 1998) Continuity of employment, however, while not necessary to regular status, is indicative of the necessity, if not indispensability of the position. The fact that an employee is not required to report at a fixed hour or to keep fixed hours of work does not detract from the employees regular status. Whether ones employment is regular is not determined by the number of hours one works but by the nature of the work and by the length of time one has been in that particular job. (International Pharmaceuticals v. NLRC, 287 S 213, 1998) The continuous rehiring by the employer of project or work pool employees for the same tasks or nature of tasks that are necessary or desirable to the employers usual business or trade grants the employees regular status. This applies even outside the construction industry. (Maraguinot v. NLRC, 294 S 539, 1998) A contractual employee who is allowed to continue working even after the termination of the contract is a regular employee. In case of doubt in any contractual provision, the doubt must be resolved in favor of labor, in favor of regular status. (PCFI v. NLRC, 1998) Probationary employment must not exceed six (6) months unless the job is of such nature that evaluation can only be done after a period longer than six months. The period can also be extended when the employer, out of liberality, clearly gave the employee another opportunity after having failed the employers standards. A probationary employee who is allowed to work beyond the probationary period becomes a regular employee.

If no standards were given the employee at the start of the probationary period, the employee is a regular employee. Disabled employees who are qualified to perform the responsibilities of their position are entitled to regular employment. The Magna Carta for Disabled Persons mandates that a qualified disabled employee should be given the same terms and conditions of employment as a qualified able-bodied person. If they perform work that is usually necessary or desirable to the business of the employer, they are regular employees. The fact that the employer merely accommodated the employees is immaterial and does not change the nature of their employment. (Bernardo v. NLRC, July 12, 1999) Project employee

A project employee is one hired to carry out a specific project or undertaking, the completion of which is determined and specified at the time of engagement. The project may or may not be within the regular or usual business of the employer. If it is within the regular or usual business, it must be distinct and separate and identifiable as such. If the employees services are extended beyond the completion of the project, the employees shall be considered regular employees. Length of service is not controlling in project employment. exceeds one year is not converted to regular employment. Project employment that

If a worker is employed as a project employee, the employer must submit a report of termination to the nearest public employment office every time his/her employment is terminated due to the completion of each project as required by Policy Instruction No. 20, applicable for the construction industry. Employees who are hired in relation to continuous special orders, which are not seasonal, are to be considered as regular employees, not project employees. Casual employee Employee hired for work that is not usually necessary or desirable to the business of the employer, work that does not constitute a project, or a seasonal work. Casual employee who has worked for an employer for at least one year, continuous or broken, shall be considered a regular employee but only with respect to the activity in which the employee is employed and while such activity exists. Term employee Fixed term employee is engaged to work for a definite period. This is allowed provided: (1) the period is agreed upon knowingly and voluntarily by the parties without force or duress or improper pressure exerted on the employee; (2) it satisfactorily appears that the employer and the employee dealt with each other on more or less equal terms with no moral dominance exercised by the employer on the latter; and (3) the term employment is not resorted to to defeat the rights of the worker.

RIGHT TO SELF-ORGANIZATION Managerial and supervisory employees

Managerial employees cannot join, form or assist in the formation of, a labor union. Supervisory employees cannot join the union of the rank and file employees but may join, assist or form their own union. The test of supervisory or managerial status depends on whether a person possesses authority to act in the interest of the employer and whether such authority is not merely routinary or clerical in nature but it requires the use of independent judgment. An employee must have the authority to effectively recommend management policies to be a supervisory employee. Thus, where such recommendatory powers ate subject to evaluation, review and final action by the department heads and other higher executives of the company, the same, although present, are not effective and not an exercise of independent judgment. The term management policies and policy determining refers to policies about matters that can be the subject of collective bargaining i.e., terms and conditions of employment. Thus, employees who have policy-determining powers but whose powers include only policies not relating to the relationship between the employer and the employees can be a rank and file employee. The prohibition against supervisory employees joining the rank and file union extends to a supervisors local union joining a federation the members of which include local unions of rank and file employees. This prohibition applies only when the rank and file employees are directly under the supervision of the supervisors and the national federation actively represents the rank and file union. A labor organization composed of both rank and file employees and supervisory employees is not a legitimate labor organization and does not have the legal personality to petition for a certification election. Confidential employees The ineligibility of managerial employees to join, form or assist any labor organization extends to confidential employees or those who by reason of their positions or nature of work are required to assist or act in a fiduciary manner to managerial employees and hence, are likewise privy to sensitive and highly confidential records. Confidential employees are those who (a) assist or act in a confidential capacity, (2) to persons who formulate, determine, and effectuate management policies in the field of labor relations. The two criteria are cumulative. Both must be met if an employee is to be considered a confidential employee i.e., the confidential relationship must exist between the employee and his supervisor, and the supervisor must handle the prescribed responsibilities relating to labor relations. An employee may not be excluded from appropriate bargaining unit merely because s/he has access to confidential information concerning the employers internal business operations and which is not related to the field of labor relations (Sugbuanon v. Laguesma, February 2, 2000). A computer operator, when his service record reveals that his duties are basically clerical and non-confidential in nature, is not necessarily a confidential employee. And as to discipline officers, they are not confidential employees and should therefore be included in the bargaining unit of rank-and-file employees (D.L.S.U. v. D.L.S.U.E.A., April 12, 2000).

Special groups of employees (guards, coop members, INC members) The right of members of Iglesia ni Kristo not to join a labor union for being contrary to their religious beliefs does not bar the members of that sect from forming their own union.

Security guards may join a labor organization of the rank and file employees, or that of the supervisory employees, depending on their rank. This is based on the presumption that the guards are employees of the establishment that they are guarding and are not under a contracting arrangement. Employees of cooperatives who are member-owners are not eligible to form or join a labor union. Labor organizations Books of account, consisting of ledgers, journals and other accounting books, are no longer required for registration of a newly organized union. Absent compliance with the mandatory requirements for submission of documents, a union does not become a legitimate labor organization. An independently registered union maintains its separate personality despite affiliation with a federation. The federation, acting for and in behalf of its affiliates, has the status of an agent while the local union remains the basic unit of the association. A disaffiliation does not disturb the enforceability and administration of a collective bargaining agreement; it does not occasion a change of administrator of the contract nor even an amendment of the provisions thereof. Even before the onset of the freedom period, disaffiliation may be carried out when there is a shift of allegiance on the part of the majority of the members of the union. Rights of union members To be valid, a special assessment must comply with two basic requirements. First, the levy of the special assessment must be authorized by a written resolution of a majority of all the members at a general membership meeting duly called for the purpose. Second, in order that The assessment may be validly checked-off, the union members must give their individual written authorizations. COLLECTIVE BARGAINING Jurisdictional requirements Collective bargaining is set in motion by the following: (1) possession of the status of majority representation of the employees representative in accordance with any of the means of selection; (2) proof of majority representation; and (3) demand to bargain. The employers refusal to make counterproposal to the unions proposed collective bargaining agreement is an indication of its bad faith. Bargaining unit The basic test of an asserted bargaining units acceptability is whether or not it is fundamentally the combination which will best assure to all employees the exercise of their collective bargaining rights. The test of the grouping is community or mutuality of interest. The fundamental factors in determining the appropriate collective bargaining unit are the following: (1) the will of the employees (Globe doctrine); (2) affinity or unity of the employees interest, such as substantial similarity of work and duties, or similarity of compensation and working conditions (Substantial Mutual Interest Rule); (3) prior bargaining history; and (4) similarity of employment status. Collective bargaining history is not decisive of what should comprise the bargaining unit.

The convenience of the employer is not the determinative factor in forming an appropriate bargaining unit. Representation Issue Direct certification is not allowed. Certification election is the most effective and the most democratic way of determining which labor organization can truly represent the working force for collective bargaining. The rules, as amended by D.O. 9, now allow the employers voluntary recognition of a union as the bargaining agent of its employees. Certification elections are exclusively the concern of employees. The employer is a mere by-stander and, as a general rule, does not have the legal personality to challenge the same. A CBA prematurely signed by the incumbent union and the employer during the freedom period does not affect the petition for certification election filed by another union. Once the required percentage requirement has been reached, the employees withdrawal from union membership taking place after the filing of the petition for certification election will not affect the petition. The failure of an independently registered labor union to prove its affiliation with a labor federation cannot affect its right to file a petition for certification election as an independent union. The term Close of certification proceedings refers to the period from the closing of the polls to the counting and tabulation of the votes. It does not include the period for the determination of the challenged votes and the canvass of said votes. Bars to Certification Election Since the law prohibits 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 by the certified union to bring the employer to the bargaining table, the employer unjustly refused to bargain. If the certified union takes an action against the employers refusal to bargain, the situation shall be treated as similar in nature to a bargaining deadlock when no CE could be held. An unregistered CBA will not bar a CE. A defective CBA (example, it was not posted prior to ratification and some workers repudiated the ratification) will not bar a CE. Excepted from the contract bar rule are certain contracts which do not foster industrial stability. The pendency of a formal charge of company domination is a prejudicial question that, until decided, bars proceedings for a certification election. The votes of the members of the dominated union will not be free.

Where the legal personality of a union is seriously challenged in a petition for cancellation of union registration, it would be more prudent for the Med-Arbiter to grant the request for suspension of proceedings in the certification election case until the issue of the unions registration shall have been resolved. (Progressive v. Laguesma, 271 S 593, 1997) Note, however, that this principle is contrary to the principle enunciated in many cases, that until the unions registration is cancelled with finality, the pendency of a petition for cancellation of union registration shall not affect the CE proceedings. CBA

The certification of a CBA by the DOLE is not required for its validity. Once a CBA is duly entered and signed by the parties, it becomes effective as between the parties whether or not the same has been certified by the DOLE. The term of a CBA shall be five (5) years insofar as the representation aspect is concerned. All other provisions must be renegotiated not later than three (3) years after its execution. Since there is no fixed term for CBA provisions, other than the representation aspect, the renegotiated terms may validly be for a period of three (3) years. If any agreement on such other provisions of the CBA is entered into within six (6) months from the date of expiry of the term of such other provisions as fixed in the CBA, such agreement shall retroact to the day immediately following such date. If such agreement is entered into beyond six (6) months, the parties shall agree on the duration of the effectivity thereof. If the parties cannot agree on its effectivity, the principle of hold over shall apply. The parties must maintain the status quo and must continue in full force and effect the terms and conditions of the existing agreement until a new agreement is reached. In short, the new agreement shall be applied prospectively, from the date of the execution of such agreement. In case no new agreement is entered into by and between the Company and the union pending appeal of the decision of the NLRC; nor were any of the economic provisions and/or terms and conditions pertaining to monetary benefits in the existing agreement modified or altered, the existing CBA in its entirety, continues to have legal effect. (New Pacific Timber v. NLRC, March 17, 2000) The actual signing of the CBA is not determinative of the question whether the agreement was entered into within six (6) months from the date of expiry of the term of such other provisions as fixed in such collective bargaining agreement. If the parties already had a meeting of the minds before the end of the six-month period, then the new provisions shall be applied retroactively. The fact that no agreement was then signed is of no moment. Only provisions embodied in the CBA should be so interpreted and complied with. Where a proposal raised by a contracting party does not find print in the CBA, it is not a part of the said CBA and the proponent has no claim whatsoever to its implementation. A CBA negotiated and signed during the pendency of certification election proceedings is valid but cannot be deemed permanent precluding commencement of negotiations by another union. The rule is that unless expressly assumed, labor contracts such as employment contracts and collective bargaining agreements are not enforceable against a transferee of an enterprise, labor contracts being in personam. The substitutionary doctrine provides that the employees cannot revoke the validly executed CBA with their employer by the simple expedient of changing their bargaining agent. The new agent must respect the contract. This doctrine is not applicable, however, to personal undertakings of the deposed union.

A dismissal of an employee is a termination dispute that falls within the Labor Arbiters jurisdiction, whether such termination arose from the interpretation or enforcement of the CBA or the company personnel policies or otherwise. UNFAIR LABOR PRACTICES The test of whether an employer has interfered with and coerced employees in the exercise of their right to self-organization is whether the employer has engaged in conduct which it may reasonably be said tends to interfere with the free exercise of the employees rights.

It is nor necessary that there be direct evidence showing that any employee was in fact intimidated or coerced. Totality of conduct doctrine. The employers actions should be evaluated not only on the basis of their implicit implications, but should be appraised against the background of and in conjunction with collateral circumstances. Under this doctrine, expressions of opinion by an employer which, though innocent in themselves, frequently were held to be culpable because of the circumstances under which they were uttered or because of their connection with an established collateral plan of coercion or interference. The act of compelling employees to sign a document indicating that the employer observed labor standards provisions of law when the employer did not, together with the act of terminating or coercing those who refuse to cooperate with the employers scheme is an unfair labor practice even if its is not connected to union activities. It preempts the right of the workers to seek better terms and conditions of employment through concerted action. It is analogous to the situation in Art. 284 which makes its an unfair labor practice to dismiss, discharge or otherwise prejudice or discriminate against an employee for having given or being about to give testimony under the Labor Code. The Court has held that an employer acts well within its rights in transferring an employee as it sees fit provided that there is no demotion in rank or diminution in pay. (Asis v. National Labor Relations Commission, 252 SCRA 379, 384). Where there exists a legitimate issue as to which of several unions is the legitimate representative of employees, it is ULP for one of the unions to stage a strike and demand that the employer sit down with it for collective bargaining. STRIKES AND OTHER CONCERTED ACTIVITIES Concept Concerted activity for mutual aid and protection is protected by the Constitution and the Labor Code. It is not necessary that union activity be involved or that collective bargaining be contemplated. Thus, the joining in protests or demands by even a small group of employees, if in furtherance of their interests as such, is a protected concerted activity and any interference with such concerted activity is ULP. A strike is any temporary stoppage of work by the concerted action of employees as a result of an industrial or labor dispute. A labor dispute includes any controversy or matter concerning terms or conditions of employment or the association or representation of persons in negotiating, fixing, maintaining, changing or arranging the terms and conditions of employment, regardless of whether or not the disputants stand in the proximate relation of employers and employees. Mass resignation or retirement is not a strike. Strikers do not quit their employment.

Requisites The prescribed cooling-off period and the 7-day strike ban after the submission of the report of strike vote are mandatory. Both must be complied with, although a union may take a strike vote and report the same within the statutory cooling-off period. A strike is valid if the strikers honestly believed that the employer committed ULP, even if the allegations of ULP are subsequently found out to be true. (Good Faith Strike rule.) It is not enough, however, that the union believes that the employer committed ULP when the circumstances clearly negate even a prima facie showing to warrant such a belief. A mere claim of good faith would not justify the holding of a strike; the circumstances must have warranted such belief.

The Good Faith Strike rule does not apply to a strike that does not comply with the mandatory procedural requirements (notice, cooling-off period, strike vote, 7-day ban). An economic strike changes in character to one for ULP from the time the employer refuses to reinstate some of its striking employees because of their union activities after it had offered to readmit all the strikers and in fact did readmit the others. Injunction An innocent bystander, who seeks to enjoin a labor strike, must satisfy the court that it is entirely different from, and without any connection whatsoever to, either party to the dispute and, therefore, its interests are totally foreign to the context thereof. Assumption of Jurisdiction The Secretary of Labor has the discretion to determine what industries are indispensable to the national interest. The assumption of jurisdiction is in the nature of a police power measure. It is not intended to impede the workers right to strike but to obtain speedy settlement of the dispute. Before the Secretary of Labor may take cognizance of an issue which is merely incidental to the labor dispute, the same must be involved in the labor dispute itself or otherwise submitted to him/her for resolution. A return-to-work order, which is automatically included in an assumption or certification order, is immediately effective and executory despite the filing of a motion for reconsideration. A strike undertaken despite the issuance of an assumption or certification order becomes a prohibited activity, and thus, illegal. Any union officer or member who knowingly participates in a strike defying a return-to-work order may consequently be declared to have lost his/her employment status. When an employer accedes to the peaceful settlement brokered by the DOLE, agreeing to accept all employees who had not yet returned to work, it waives the issue of the illegality of the strike. Consequences of strike Mere finding of illegality of strike should not be followed by wholesale dismissal of strikers from employment. A union office who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost their employment status. An ordinary striking worker cannot be terminated for mere participation in an illegal strike. The law grants the employer the option of declaring a union officer who participated in an illegal strike as having lost his/her employment. Not every form of violence suffices to affix the seal of illegality on a strike or to cause the loss of employment by the guilty party. Acts of violence must be pervasive and widespread, and consistently and deliberately resorted to as a matter of policy, before they can be sufficient for a declaration of illegality of an otherwise legal strike. By filing a formal complaint for illegal strike, the employer should desist from undertaking its own investigation on the same matter, concluding upon the illegality of the union activity and dismissing outright the union officers involved.

POST-EMPLOYMENT Just Causes Misconduct is improper or wrong conduct. It is 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. The misconduct must be of such grave and aggravated character and not merely trivial or unimportant. Such misconduct must also be in connection with the employees work. In order that willful disobedience by the employee may constitute a just cause for termination, the orders, regulations, or instructions of the employer must be: (1) reasonable and lawful; (2) sufficiently known to the employee; and (3) in connection with the duties which the employee has been engaged to discharge. Note that the employees assailed conduct must have been willful or intentional, the willfulness being characterized by a wrongful and perverse attitude. Company policies and regulations are, unless shown to be grossly oppressive or contrary to law, generally valid and binding on the parties and must be complied with until finally revised or amended. The reasonableness and lawfulness of a rule, order or instruction depend on the circumstances availing in each case reasonableness pertains to the kind or character of directives and command and to the manner in which they are made. Gross negligence implies a want or absence of or failure to exercise slight care or diligence, or the entire absence of care it evinces thoughtless disregard of consequences without exerting any effort to avoid them. To be a just cause for dismissal, the negligence must not only be gross, it should also be habitual. Abandonment, as a just and valid ground for termination, means the deliberate, unjustified refusal of an employee to resume his/her employment. Two elements must be proved; (1) the intention to abandon; and (2) an overt act from which it may be inferred that the employee has no more intent to resume his/her work. Prompt filing of an illegal dismissal case contradicts the allegation of abandonment. The basic premise for dismissal on the ground of loss of confidence is that the employee concerned holds a position of trust and confidence.

With respect to rank and file employees, loss of trust and confidence as a ground for termination requires proof of involvement in the alleged events in question, and that mere uncorroborated assertions and accusations by the employer will not be sufficient. As regards a managerial employee, however, mere existence of a basis for believing that such employee has breached the trust of his/her employer would suffice. 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. The conviction of an employee in a criminal case is not indispensable to warrant his/her dismissal. The fact that a criminal complaint against the employee has been dropped by the city fiscal is not binding and conclusive upon a labor tribunal.

The requirements for the lawful dismissal of an employee by the employer are two-fold: the substantive and the procedural. Twin requirements of notice and hearing constitute essential elements of due process in cases of employee dismissal. Dismissal of an employee must be for a just and authorized cause and after due process. Violation of the right to an investigation, however, will not necessarily entitle the employee to reinstatement and backwages when such employee was accorded due process during the proceedings before the Labor Arbiter and the employees commission of an act constituting a just cause for termination was established. In such case, the dismissal should be maintained but the employer must indemnify the employee in the form of damages, as sanction for its failure to respect the procedural requirements of due process. Note that this Wenphil doctrine was abandoned in the Serrano case, decided last year. The penalty imposed on the erring employee must be proportionate to the offense committed. Hence, if dismissal is grossly disproportionate to the offense, a less severe penalty must suffice. The dismissal in such case should be considered illegal. In many cases, the value of the article involved in the offense and the previous record of the employee were considered to determine whether dismissal was the appropriate penalty. Constructive dismissal; Preventive suspension Constructive dismissal is an involuntary resignation resorted to when continued employment is rendered impossible, unreasonable or unlikely; when there is a demotion in rank and/or diminution in pay; or when a clear discrimination, insensibility or disdain by an employer becomes unbearable to the employee. (Leonardo v. NLRC, June 16, 2000) Preventive suspension is proper when the continued employment of an employee poses a serious and imminent threat to the life and property of the employer or of his/her coemployees. Preventive suspension is not a penalty in itself. Employees who remain without work or assignment for a period exceeding six (6) months are in effect constructively dismissed. Authorized Causes Redundancy exists where the services of an employee are in excess of what is reasonably demanded by the actual requirements of the enterprise. It does not necessarily refer to duplication of work. The fact that no other person was holding the same position as that declared to be redundant does not negate redundancy. General standards for valid retrenchment: (1) losses expected should be substantial and not merely de minimis; (2) the substantial losses must be reasonably imminent, and such imminence can be perceived objectively; (3) retrenchment must be reasonably necessary and likely to effectively prevent the expected losses; and (4) alleged losses if already realized and expected imminent losses must be proved by sufficient and convincing evidence. For retrenchment to be valid, it is not necessary that losses be actually sustained. The existence of valid grounds to anticipate or expect losses would be sufficient justification for retrenchment. Retrenchment is only a measure of last resort when other less drastic means have been tried and found to be inadequate. The failure of the employer to show its income or loss for the immediately preceding years or to prove that it expected no abatement of such losses in the coming years is fatal to the employers cause in proving the validity of a retrenchment. Retrenchment is available to a non-stock, non-profit organization as a measure adopted to stave off threats to its existence.

The determination to cease operations (closure) 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 workers in employment. 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, the State must intervene. No law requires that purchaser of a companys assets should absorb its employees. The phrase closure or cessation of operation applies in cases of both complete and partial cessation of the business operation. An audited financial statement is indeed the normal method of proof of profit and loss but such norm does not compel the Supreme Court to accept the contents of said documents blindly and without thinking. Consequences of Dismissal An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to full backwages, inclusive of allowances, and to other benefits or their monetary equivalent computed from the time compensation was withheld up to the time of actual reinstatement. Separation pay shall be allowed as a measure of social justice only in those instances where the employee is validly dismissed for causes other than serious misconduct or those reflecting on his moral character. Reinstatement presupposes that the previous position from which the employee had been removed still exists, or there is an unfilled position of a similar nature, more or less, as the one previously occupied by the employee, but if no such position is available, reinstatement becomes a legal impossibility the law cannot exact compliance with what is impossible. The doctrine of strained relations cannot be applied indiscriminately since every labor dispute almost invariably results in strained relations. The strained relations rule may be invoke only against employees whose positions demand trust and confidence, or whose differences with their employer are of such nature or degree as to preclude reinstatement. Award of separation pay (in lieu of reinstatement) is to be computed from the start of employment up to the time of termination thereof, including the period of imputed service for which the employee is entitled to backwages. An employer found guilty of illegal dismissal 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. Backwages to be awarded to an illegally dismissed employee should not be diminished or reduced by the earnings derived by the employee elsewhere during the period of the illegal dismissal. If reinstatement is no longer feasible, backwages shall be computed from the time of the illegal dismissal up to the time of the finality of the decision. Failure to claim backwages in a complaint is a mere procedural lapse which cannot defeat a right granted under a substantive law. Disease Absence of a medical certificate from a competent public health authority indicates that the employees disease is not of such a nature that it will not be cured within a period of 6 months even with proper medical treatment, and thus his/her dismissal was a severe and unlawful sanction.

SERRANO DOCTRINE: Termination due to authorized cause without giving the notice required under the Labor Code is not a violation of due process. It is valid although declared irregular/ineffectual. (G.R. 117040, January 27,2000) He shall however be entitled to separation pay and backwages subject to the following rules:

o When the dismissal is for a cause, the employee, whether dismissed for just
cause or authorized cause but without prior notice, is entitled to full backwages from the time he was terminated until the decision finding cause becomes final.

o When the dismissal is without just or authorized cause, backwages shall be

computed from the time of his dismissal until his actual reinstatement. Serrano v. NLRC reversed Wenphil (170 SCRA 69) where the Supreme Court held that failure of the employer to give the notice required is a violation of due process. If the just cause was not proved to have existed, the employee is entitled to backwages and reinstatement. If the just cause was proved, then no reinstastement is possible. Recent enlightening principles on the causes of termination: Closure, as a cause for termination warranting separation pay, does not contemplate a situation where the closure of the business establishment is forced upon the employer and ultimately for the benefit of the employees, i.e., when the government takes over a business.(NFL v. NLRC, March 2, 2000). However, even though the transfer is due to a reason beyond the control of the employer, employees are entitled to some relief in the form of severance pay (Cheniver Corp. v. NLRC, February 17, 2000). Serious misconduct does not merely involve offensive utterances and obscene gesture during an informal Christmas gathering of a companys district sales managers and marketing staff. The gathering was just a casual get-together of employees. It is to be expected during this kind of gatherings, where tongues are loosened by liquor or other alcoholic beverages, employees freely express their grievances and gripes against their employers. (Samson v. NLRC, April 12, 2000) DISPUTE SETTLEMENT The Secretary of labors visitorial and enforcement powers to enforce compliance with labor standards laws, in cases where employer-employee relationship still exists, can be exercised even if the individual claim per employee exceeds P5,000.

Where the dispute is just in the termination, implementation or enforcement stage, it may be referred to the grievance machinery in the CBA or by voluntary arbitration, but where there is already actual termination, i.e. violation of rights, it is already cognizable by the labor arbiter. Decisions of the NLRC can no longer be brought straight to the Supreme Court. remedy is to file a petition for certiorari with the Court of Appeals. The

Petitions for certiorari against decisions of the Secretary of Labor should be filed with the Court of Appeals, not with the Supreme Court. A CBA which is part of an arbitral award may be made retroactive to the date of expiration of the previous agreement. Art. 253-A, providing for retroactivity when the parties agreed on the renegotiated provisions within 6 months from the expiry of such provisions, applies only to CBAs entered into by the parties as a result of their mutual agreement.

Civil aspects of all cases involving ULP including claims for damages and other affirmative relief should be within the jurisdiction of the labor arbiters. The original and exclusive jurisdiction of labor arbiters for money claims under Art. 217 (c) is limited only to those arising from statutes or contracts other than a CBA. The Voluntary Arbitrator has original and exclusive jurisdiction over money claims arising from the interpretation or implementation of the CBA. In illegal dismissal cases, the employer has the burden of proof to prove that the dismissal is legal and failure to discharge this burden shall warrant a finding that the dismissal is illegal. To justify solidary liability, 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 employees, or 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 to statutes, and to confuse legitimate issues. For purposes of venue, workplace shall be understood as the place or locality where the employee is regularly assigned when the cause of action arose. The president, vice-president, secretary and treasurer are commonly regarded as the principal or executive officers of a corporation but other officers are sometimes created by the charter or by-laws of the corporation, or the board of directors may be empowered under the by-laws of a corporation to create additional offices as may be necessary. The determination of the rights of a person and the concomitant liability of the corporation arising from the formers ouster from a corporate office, is an intra-corporate controversy subject to the SECs jurisdiction. Upon the appointment by the SEC of a management committee or a rehabilitation receiver, all actions for claims against the corporation pending before any court, tribunal or board shall ipso jure be suspended. This rule applies to labor cases. (Rubberworld Phils. V. NLRC, 305 S 721, 1999) A labor arbiters order of reinstatement is immediately executory even pending appeal and the posting of a bond by the employer shall not stay the execution for reinstatement. There is no need for a writ of execution. The power of the court, or the NLRC, to execute its judgment extends only to properties unquestionably belonging to the judgment debtor. If the 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. Even upon a prima-facie showing of ownership by the third party claimant, if the third party claim does not involve, nor grow out of, a labor dispute, a separate action for injunctive relief against such levy may be maintained in court. The NLRC is vested with authority to look into the correctness of the execution of the decision and to consider supervening events that may affect such execution. Injunction is not a cause of action in itself but merely a provisional remedy, an adjunct to a main suit. The power of the NLRC to issue an injunction writ originates from any labor dispute upon application by a party thereof, which application if not granted may cause grave and irreparable damage to any party or render ineffectual any decision in favor of such party. It is an essential requirement that there must first be a labor dispute between the contending parties before the labor arbiter. Quitclaims, waivers or releases are looked upon with disfavor. Quitclaims executed by the employees do not estop them from pursuing their claims arising from the unfair labor practices of the employer. Not all waivers and quitclaims made by dismissed employees, however, are void. If the agreement was voluntarily entered into and represents a reasonable settlement, it is binding on the parties and may not later be disowned simply because of a change of mind.

Dire necessity is not a ground for annulling a quitclaim. LABOR STANDARDS The term househelper or domestic servant clearly contemplates such househelper or domestic servant who is employed in the employers house to minister exclusively to the personal comfort and enjoyment of the employers family. The term cannot include a househelper working in staffhouses of a company. Even if workers perform nonagricultural work away from the employers business offices, but throughout the duration of their work, they are under the effective control and supervision of the employer through its agent, the workers cannot be considered as field personnel. An employers unexplained silence contravening the personnel data sheet and the attendance sheets presented by an employee showing he worked for twelve hours assumes the character of an admission. Entitlement to overtime pay must first be established by proof that said overtime work was actually performed, before an employee may avail of said benefit. A wage disparity between employees occupying the same position but assigned to different regions resulting from differences in the regional minimum wage rates is not wage distortion. Workers who are paid by results are not exempted from the coverage of the overtime pay benefit, and therefore entitled to overtime pay, if their output rates are not in accordance with the standards prescribed by the rules or with the rates prescribed by the Secretary of Labor. If an employer accords employees the same position and rank, the presumption is that these employees perform equal work. While it is recognized that there exists the need of a school to attract foreign-hires, salaries should not be used as an enticement to the prejudice of local-hires. The local-hires perform the same services as foreign-hires and they ought to be paid the same salaries as the latter. For the same reason, the "dislocation factor" and the foreign-hires' limited tenure also cannot serve as valid bases for the distinction in salary rates. The dislocation factor and limited tenure affecting foreign-hires are adequately compensated by certain benefits accorded them which are not enjoyed by local-hires, such as housing, transportation, shipping costs, taxes and home leave travel allowances (I.S.E.A. v.Quisumbing, June 1, 2000).

Compensability of sickness

For a sickness and the resulting disability or death to be compensable, the said sickness must be an occupational disease listed under Annex A of said Rules, [Amended Rules on Employees Compensation.] otherwise, the claimant or employee concerned must prove that the risk of contracting the disease is increased by the working condition. [Bravo v. ECC, 227 Phil. 93, 97 [1986].] Compensability of the illness or death of seamen need not depend on whether the illness was work connected or not. [Sealanes Marine Services, Inc. vs. NLRC, 190 SCRA 337, 346 (1990)] It is sufficient that the illness occurred during the term of the employment contract. It will also be recalled that petitioners admitted that private respondent's work as a radio officer exposed him to different climates and unpredictable weather, which could trigger a heart attack or heart failure. [Rollo, p. 25.] Even assuming that the ailment of the worker was contracted prior to his employment, this still would not deprive him of compensation benefits. For what matters is that his work had contributed, even in a small degree, to the development of the disease and in bringing about

his eventual death. [Wallem Maritime Services, Inc. vs. NLRC, G.R. No. 130772, November 19, 1999, p. 8.] Neither is it necessary, in order to recover compensation, that the employee must have been in perfect health at the time he contracted the disease. (Seagull v. NLRC, June 8, 2000) Cardiovascular diseases are listed as compensable occupational diseases in the Rules of the Employees Compensation Commission, hence, no further proof of casual relation between the disease and claimants work is necessary to claim compensation. (Salmone v. Employees Compensation, September 26, 2000)