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Labor Relations

University of the Cordilleras College of Law

What is Labor?
As an act: Exertion by human beings of
physical or mental efforts, or both, towards
the production of goods and services.
As a sector of society: That sector or group
in a society, which derives its livelihood
chiefly from rendition of work or services in
exchange for compensation under
managerial direction (Mendoza, 2001).
Refers to workers, whether agricultural or
non-agricultural

Note:

The Labor Code articles cited here are those


that are numbered according to the Codal of
Rex Bookstore, 2013 edition. The
renumbering accommodated the revisions
introduced to the Code by RA 10151. If you
are using an older codal version, just
subtract six from the article number (e.g.,
ULP of employers in the 2013 Rex codal is
Art. 254. Old number is Art. 248)

Preliminary
Discussions
Constitutional Mandates on
Labor, Labor Law
Labor Legislation, Social
Legislation

Constitutional Mandates on
Labor
The State shall protect and promote the interests of the
Filipino Laborer:
Art. II, Sec. 9. 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 improved quality of life for all.
Art. II, Sec. 18. The State affirms labor as a primary
social economic force. It shall protect the rights, of
workers and promote their welfare.

Constitutional Mandates on
Labor
The State shall protect and promote the interests of the
Filipino Laborer:
Art. XII, Sec. 12. The State shall promote the preferential
use of Filipino labor, domestic materials and locally produced
goods, and adopt measures that help make them
competitive.

Art XIII, Sec. 14. The State shall protect women by


providing safe and healthful working conditions, taking into
account their maternal functions, and such facilities and
opportunities that will enhance their welfare and enable them
to realize their full potential in the service of the nation.

Art. XV, Sec. 8. The State shall, from time to time, review to
upgrade the pensions and other benefits due to retirees of

Constitutional Mandates on
Labor
Rights of Workers
Art. Ill, Sec. 8. The right of the people, including
those employed in the public and private sectors,
to form unions, associations, or societies for
purposes not contrary to law, shall not be abridged.
(formation of labor organizations)
Art. Ill, Sec. 18(2). No involuntary servitude in
any form shall exist except as a punishment for a
crime whereof the party shall have been duly
convicted.

Constitutional Mandates on
Labor
Protection to Labor Clause
Art. XIII, Sec. 3 The State shall afford full protection to
labor, local and overseas, organized and unorganized, and
promote full employment and equality of employment
opportunities for all.

It shall guarantee the rights of all workers to self-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 process affecting their rights and
benefits as may be provided by law.

Participation in Policy and


Decision Making Processes
Phrase included in the 1987 constitution to
highlight workers participation in policymaking;
Added in the Labor Code

Article 217, Declaration of Policy


Article 261, Exclusive Bargaining Representation
and Workers Participation in Policy and DecisionMaking

Constitutional Mandates on
Labor
Protection to Labor Clause
Art. XIII, Sec. 3 , cont.
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 of investments, and to expansion and
growth.

Commit Art. XIII, Sec. 3 to


memory!
Defines rights of workers under Labor Standards and
Labor Relations:

Under Labor Standards


Security of Tenure;
Living wage;
Share in the fruits of
production; and
Humane conditions of
work.

Under Labor Relations


Self-organization
Collective bargaining
and negotiations
Peaceful concerted
activities, including
strike;
Participation in policy
and decision-making
processes.

Social, Labor and Welfare


Legislation
Constitutional provisions on labor are not self-executory, hence
the need for Social Legislation, Labor Legislation and Welfare
Legislation
Social Legislation - Laws that provide particular kinds of
protection or benefits to society or segments thereof in
furtherance of social justice.
Labor Legislation - Statutes, regulations and jurisprudence
governing the relations between capital and labor. It provides
for certain employment standards and a legal framework for
negotiating, adjusting and administering those standards and
other incidents of employment.
Welfare Legislation - Provides for the minimum economic
security, of the worker and his family in case, of loss of earnings
due to death, old age, disability, dismissal, injury or disease.

Social Legislation and Labor


Legislation, Distinguished

Labor Legislation

Social Legislation

Effect to
Employment

Directly affects
employment

Governs the effects of


employment

Purpose

Designed to meet the daily


needs of workers

Involves long range benefits

Coverage

Covers employment for


profit or gain

Covers employment for


profit and non-profit

Effect to Employee

Affects work of employee

Affects life of employee

Payor

Benefits are paid by the


workers employer

Benefits are paid by


government agencies

Social legislation encompasses labor legislation, thus is broader in


scope than the latter. All labor laws are social legislations but not all
social legislations are labor laws.

Labor Law, defined.


The law governing the rights and duties of
employers and employees with respect to Labor
Standards and Labor Relations.
Labor Standards Law deals with the minimum
standards as to wages, hours of work and other
terms and conditions of employment that
employers must provide their employees.
Labor Relations Law defines the status, rights
and duties as well as the institutional mechanisms
that govern the individual and collective
interactions between employers, employees and
their representatives.

The Philippine Labor Code, and


Other Laws

Presidential Decree No. 442


Deals with Labor Standards and Labor Relations
Became effective November 1, 1974

Special Laws:
a. Laws on Social Security (SSS Law, GSIS Law, Limited Portability Law (RA
7699)
b. National Health Insurance Act
c. Paternity Leave Act
d. Retirement Pay Law
e. Home Mutual Development Fund Law
f. Anti-Sexual Harassment Act
g. Anti-Child Labor Act
h. 13th Month Pay Law
i. Migrant Workers and Overseas Filipinos Act of 1995 (R.A. No. 8042, as
amended by RA 10151)
j. Expanded Comprehensive Agrarian Reform Law
k. Magna Carta for Public Health Workers

The Philippine Labor Code, and


Other Laws

Labor-related provisions in Other Laws

Civil Code
a. Art. 1700. The relation between capital and labor are not
merely contractual. They are so impressed with public interest
that labor contracts must yield to the common good. Therefore,
such contracts are subject to the special laws on labor unions,
collective bargaining, strikes and lockouts, closed shop, wages,
working conditions, hours of labor and similar subjects.
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 legislations 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.

The Philippine Labor Code, and


Other Laws

Labor-related provisions in Other Laws

Revised Penal Code


a. Art. 289. Formation, maintenance and prohibition of
combination of capital or labor through violence or threats.
The penalty of arresto mayor and a fine not exceeding
300 pesos shall be imposed upon any person who, for the
purpose of organizing, maintaining or preventing coalitions
of 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
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 this Code.

The Aim and Basis of Labor


Laws

Attainment of Social Justice


Balance the interest of labor and capital
(eliminate oppression)
Labor is afforded a greater measure of protection
There is greater supply of labor than demand for
their services;
Those who have less in life should have more in law;
The need for employment by labor comes from vital,
and even desperate necessity (survival);

Basic Principles
Preliminary Discussions on
the Labor Code

What are the basic principles in


the constitution and labor-related
laws on protection to labor?

The state shall afford full protection to labor,


promote full employment, equal work
opportunities without bias or discrimination,
regulate the relations of employers and
employees, and assure workers rights (refer to
protection to labor clause Art. XIII, Sec. 3, 1987
Const. & Art. 3, Labor Code);
The relation of capital and labor are impressed
with public interest, hence employment
contracts are not ordinary contracts (Art. 1700,
NCC);

What are the basic principles in


the constitution and labor-related
laws on protection to labor?

In case of doubt or ambiguity, labor laws and rules


are to be construed in favor of labor (Art. 4, Labor
Code, Art. 1702, Civil Code)
IF THERE IS DOUBT as to the meaning of the legal and
contractual provision, the above-mentioned applies.
IF THE PROVISION IS CLEAR AND UNAMBIGUOUS, it must
be applied in accordance with its express terms. (Meralco
v. NLRC, GR No. 78763, July 12, 1989).
The law also recognizes that management has rights
which are also entitled to respect and enforcement in the
interest of fair play (St. Luke's Medical Center Employee's
Assoc, v. NLRC, GR No. 162053, March 7, 2007).

Why the preference for labor


over capital?
Comes from acknowledgement that capital
wields more power than labor;
(Sanchez v. Harry Lyons Construction Inc.,
GR No. L-2779, October 18, 1950).

There is greater supply than demand for labor;


Those who have less in life should have more in law;
and
The need for employment by labor comes from vital,
and even desperate necessity (survival)

To whom does the Labor Code


apply?
General Rule: The Code applies to all workers, whether agricultural or
non-agricultural, including employees in a government corporation
incorporated under the corporation code;
Exceptions:
1. Government employees;
2. Employees of government Corporations created by special or
original charter;
3. Foreign governments;
4. International Agencies, employees of intergovernmental or
international organizations;
5. Corporate officers/Intra-corporate disputes which fall under PD 902A and now fall under the jurisdiction of, the Regular Courts pursuant
to the Securities Regulation Code; and
6. Local water districts except where NLRC jurisdiction is invoked.

Cases
Government employees;
Employees of government Corporations created by special or original
charter (Juco v. NLRC, GR No. 98107, August 18, 1997);
Foreign governments (JUSMAG-Philippines v. NLRC, GR No. 108813,
December 15, 1994);
International Agencies (Lasco v. UNRFNRE, GR Nos. 109095-109107,
February 23, 1995), employees of intergovernmental or international
organizations (SEAFDEC-AQD v. NLRC, GR No. 86773, February 14, 1992);
Corporate officers / Intra-corporate disputes which fall under PD 902-A
and now fall under the jurisdiction of, the Regular Courts pursuant to the
Securities Regulation Code (Nacpil v. IBC, GR No. 144767, March 21,
2002); and
Local water districts (Tanjay Water District v. Gabaton, GR Nos. 63742 and
84300, 17 April 1989) except where NLRC jurisdiction is invoked
(Zamboanga City Water District v. Buat, GR No. 104389, May 27, 1994).

Protection to labor should not


come at the expense of
oppressing capital!

Law recognizes management rights. The


employer has the right to

Conduct business;
Prescribe rules;
Select and hire employees;
Transfer or discharge employees;
Discipline of employees, and
Return of investment and expansion of business.

Management Prerogatives

Rural Bank of Cantilan . v. Julve, GR No. 169750, February


27, 2007.
Under the doctrine of management prerogative, every employer
has the inherent right to regulate, according to his own discretion
and judgment, all aspects of employment, including hiring, work"
assignments, working methods, the time, place and manner of
work, work supervision, transfer of employees, lay-off of workers,
and discipline, dismissal, and recall of employees

Mendoza v. Rural Bank of Lucban, GR No. 155421, July 7,


2004.
Management prerogatives, however, are subject to limitations
provided by
law,
contract or collective bargaining agreements and
general principles of fair play and justice

Viewpoints on Labor
Relations
The Whys and Hows

State Policy on Labor


Relations

Article 217, Labor Code


Promote and emphasize the primacy of free collective
bargaining and negotiations, including voluntary arbitration,
mediation and conciliation, as modes of settling labor or
industrial disputes;
Promote free trade unionism as an instrument for the
enhancement of democracy and the promotion of social
justice and development;
Foster the free and voluntary organization of a strong and
united labor movement;
Promote the enlightenment of workers concerning their
rights and obligations as union members and as employees;

State Policy on Labor


Relations

Article 217, Labor Code


Provide an adequate administrative machinery for the
expeditious settlement of labor or industrial disputes;
Ensure a stable but dynamic and just industrial peace;
and
Ensure the participation of workers in decision and
policy-making processes affecting their rights, duties and
welfare.
Prohibit courts or administrative agencies or officials
from setting or fixing wages, rates of pay, hours of work
or other terms and conditions of employment, except as
otherwise provided under the Labor Code.

Goal

Social Justice

Outcome

Industrial Peace and


Progress
Collective Interaction,
Er-Ee

Processe
s

Labor Organization/Workers
Association

Terms and Conditions of


Employment
Addressing Grievances
Employer
Representation

Self Organization

Inputs

Employees Rights
and Duties

Employers Rights
and Duties

Self Organization
Workers organize as a union or some other
form of association (registered or
unregistered)
Effect of registration with the State:
Acquisition of legally demandable rights,
e.g. right to demand collective bargaining
Organization must have rules and
mechanisms that respect member rights
No employer influence or interference (See
Article 261, Labor Code)

Why Workers Organize


Self Advancement
Job Security
Upholding the rule of law over arbitrary
exercise of power by capital
Provide employees a sense of participation
in the enterprise

Self Organization

There can be many labor organizations in


the workplace, but
Only one recognized representative for workers in
Collective Bargaining
Selected by the workers themselves by way of
election (with or without intervention of the
government)

Who may exercise right to selforganization


All persons employed in commercial,
industrial and in religious, charitable,
medical or educational institutions (profit or
non-profit)
Includes the right to

Form
Join
Assist
Labor organizations of their own choosing

Collective Bargaining

Presentation of proposals and counter-proposals


by the parties
If capital and labor agree on substantially all
points, a labor contract is forged (Collective
Bargaining Agreement)
If both parties do not agree on material points,
this results in a deadlock
Parties are obliged to avoid or break the impasse
Failure to resolve a deadlock may result in work
stoppage
Strike
Lockout

Collective Bargaining
While a legal right, strike or lockout is not an ideal
solution to compel a party to agree to a proposal
Considered as measures of last resort
Strikes and lockouts are heavily regulated

Purpose
Manner of implementation
Violation of established rules will merit sanctions
(admin, civil and criminal)

Parties are allowed to introduce means and


methods that will expedite bargaining
Subject to compliance to legal standards

Collective Bargaining

Parties are primarily responsible for dealing


with problems arising out of their relations
(Inter-party relationship)
Voluntary modes of settling disputes are preferred
over compulsory processes
Grievance machinery: In-house problem solving
structure
State steps in only when
Parties fail to agree
Rights are violated

States Intervention

SSS Employees Association vs. CA, 175 SCRA 686: The


principle behind labor unionism in private industry is that
industrial peace cannot be secured through compulsion by law.
Relations between private employers and their employees rest
on an essentially voluntary basis. the terms and conditions
of employment in the unionized private sector are settled
through the process of collective bargaining

But, when dispute


transgresses legal
boundaries, the injuctive
powers of the state may
be invoked, especially
when national interest is
involved.

Definitions

Employer: Includes any


person acting in the
interest of an employer,
directly or indirectly.
The term shall not
include any labor
organization or any of
its officers or agents
except when acting as
an employer.

Definitions

Employee: Includes any person


in the employ of an employer.
The term shall not be limited to
the employees of a particular
employer, unless the Labor Code
so explicitly states. It shall
include any individual whose
work has ceased as a result of or
in connection with any current
labor dispute or because of any
unfair labor practice if he has
not obtained any other
substantially equivalent and
regular employment.

Categories of employees
Managerial employees
Supervisory employees
Rank-and-file employees

Existence of Er-Ee Relationship


is Vital in Labor Relations
If there is no such relationship, there is no
basis for exercising the right of selforganization for purposes of collective
bargaining.
Note also that Labor Arbiters cannot
exercise jurisdiction where Er-Ee
Relationship does not exist. (subj. to
exception)

Employer-Employee
Relationship

Four-Fold Test
1.
2.
3.
4.

the selection and engagement of the employee;


the payment of wages;
the power of dismissal; and
the power to control the employees conduct, or the socalled control test.

Two-tiered test of employment relation ship


1. Control test the employers power to direct the employee
(the manner, means and methods) by which work is
accomplished;
2. Economic reality test economic reality of the relationship;
the question of economic dependency of the worker on his
employer. (Read Orozco vs. CA, GR 155207, April 29, 2005)

Existence of Er-Ee Relationship


in the following instances:

A stipulation stating expressly that there is no Er-Ee


relationship is not controlling (Chavez vs. NLRC, GR No.
146530, Jan. 2005)
Jeepney and taxi drivers (Paguio Transport Corp. vs. NLRC
GR No. 119500, August 1998)
Bus, auto-calesa drivers (R. Transport Corp. vs. Ejandra,
GR No. 148508, May 2004)
Fishermen (Ruga vs. NLRC, Jan. 1990)
Stevedores
Lawyers, doctors, nurses, dentists, public relations
practioners, other professionals
Employees of cooperatives
Insurance agents (salaried)

No Er-Ee Relationship in the


following instances:
Commission salesmen
Agents of prinicipal (who are not employees
in other respects)
Working scholars (See Section 14, Rule X,
Book III, IRR, Labor Code)
Consultants
Visiting Physicians
Independent contractors

Definitions

Labor disputes: 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 the disputants stand in the
proximate relation of employer and employee.

Labor Disputes

Nature: arises from Er-Ee relationship,


regardless of whether the disputants stand in
the proximate relation of employer and
employee;
SMCEU-PTGWO vs. Bersamira & SMC, GR No. 87700,
June 1990)
Involves issue of SMCs exclusion of temporary,
probationary & contractual employees in scope of CBA
with union

Subject Matter
Terms and conditions of employment
Association or Representation of persons

Labor Disputes, Kinds

Standards-related
Compensation
Benefits
Working Conditions

Relations Disputes

Organizational rights/ULP
Representation
Bargaining
Contract administration
Personnel policy
Employment tenure disputes

Resolving Labor Disputes


Grievance procedure CBA-prescribed, in-house
mechanism for addressing complaints.
Conciliation involves third person who meets with
both parties and, by assuaging hurt feelings and
cooling tempers, aids in reaching agreement.
Mediation third person offers suggested solutions to
dispute.
Arbitration dispute is submitted to impartial third
person who renders decision based on evidence, law
and jurisprudence. Decision is enforceable.

Voluntary by agreement of parties


Compulsory directed by law. Primarily done by labor arbiters
of the NLRC

Resolving Labor Disputes


Enforcement/Compliance Order dispute
arises from concern uncovered by the exercise
of enforcement/visitorial power of SOLE, or
adjudicatory powers of the DOLE Regional
Directors (Articles 128, 129, Labor Code)
In case of labor disputes that may affect an
industry indispensable to the national interest,
the following apply:

Assumption of jurisdiction by DOLE


Certification to the NLRC for compulsory arbitration

The National Labor


Relations Commission
Jurisdiction, Case Flow,
Appeals, Cases

The National Labor Relations


Commission
Precursor: Court of Industrial Relations
NLRC was created by the Labor Code

attached to the DOLE


Under EO 204, s. 2005, DOLE exercises
administrative supervision over the commission
Under RA 9347, several changes to the
composition of the divisions, rank equivalence,
and reverted to the old version of NLRCs
attachment to DOLE (program and policy
coordination)
Equal representation from workers, employers &
public sector

The National Labor Relations


Commission
NLRC exercises adjudicatory powers and
other functions through its divisions (not the
individual commissioners);
En banc decisions pertain only to

Promulgation of rules governing hearing and


disposition of cases in the divisions (e.g., 2011
NLRC Rules);
Recommending Labor Arbiters to the President
Allowing a division to hear and decide a case
under the jurisdiction of another division

Jurisdiction of Labor
Arbiters

Original and exclusive jurisdiction to hear and


decide the following cases involving all workers,
whether agricultural or non-agricultural (Art. 223,
LC, Rule V Section 1, 2011 NLRC Rules):
1. Unfair labor practice cases; ULP Means "Unfair labor
practice" means any unfair labor practice as expressly
defined by the Code (Art. 218(K), Art. 254, Art. 255).
2. Termination disputes;
3. If accompanied with a claim for Reinstatement, those
cases that workers may file involving wages, rates of
pay, hours of work and other terms and conditions of
employment;

Jurisdiction of Labor
Arbiters
4.

5.

6.

Claims for actual, moral, exemplary and other forms of


Damages arising from the employer-employee relations;
Cases arising from any Violation of Article 270 of this
Code, including questions involving the legality of strikes
and lockouts; and
Except claims for Employees Compensation, Social
Security, Medicare and maternity benefits, all other
Claims arising from employer-employee relations,
including those of persons in domestic or household
service, involving an amount exceeding five thousand
pesos (P5,000.00) regardless of whether accompanied
with a claim for reinstatement (Article 223, Labor Code,
as amended).

Jurisdiction of Labor
Arbiters
7.

8.

9.

10.

Original and exclusive jurisdiction over money claims arising


out of 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 damages (Section 10, Republic Act No. 8042, as amended by
Republic Act No. 10022).
Wage distortion disputes in unorganized establishments not
voluntarily settled by the parties pursuant to Republic Act No.
6727.
Enforcement of compromise agreements when there is noncompliance by any of the parties or if there is prima facie
evidence that the settlement was obtained through fraud,
misrepresentation or coercion (Article 233, Labor Code, as
amended).
Other cases as may be provided by law.

Cases
The jurisdiction of labor arbiters, as well as of the NLRC, is
limited to disputes arising from an employer-employee
relationship which can only be resolved by reference to the
Labor Code, other labor statutes, or their collective
bargaining agreement. U-Bix's complaint was one to collect
sum of money based on civil laws on obligations and
contract, not to enforce rights under the Labor Code, other
labor statutes, or the collective bargaining agreement. (UBix Corporation, et al. vs. Valerie Anne H. Hollero, G.R. No.
177647, October 31, 2008)
The jurisdiction of labor courts extends only to cases where
an employer-employee relationship exists. (Jaguar
Security & Investigation Agency vs. Rodolfo Sales, et. al.,
G.R. No. 162420, April 22, 2008)

Cases

Exception to the rule that Er-Ee relationship


is necessary for Labor Arbiters to acquire
jurisdiction:
The jurisdiction of Labor Arbiters is not limited to
claims arising from Employer-Employee
relationships under Sec. 10 of RA 8042, which
cover money claims arising out of an employeremployee relationship or by virtue of any law or
contract involving Filipino workers for overseas
deployment, including claims fordamages.
Santiago vs. CF Sharp Crew Management, Inc. (GR
No. 162419, July 2007)

Cases
Corporate Officers
Nacpil vs. IBC (GR No. 144767, March 21,
2002) Officers designated by the board are
corporate officers
Prudential Bank and Trust Company (GR
No. 141093, Feb. 20, 2001) - One rising from
the ranks is not a mere corporate officer
Rural Bank of Coron vs. Cortes, (GR No.
164888, Dec. 6, 2006) A corporate officer
who is also an employee may file an illegal
dismissal case with the labor arbiter.

Cases
See also
Okol vs. Slimmers World International (GR No.
160146, December 11, 2009)
Gomez vs. PNOC Development and
Management Corporation (GR No. 174044,
November 27, 2009)
Atty. Virgilio R. Garcia vs. Eastern
Telecommunications Philippines (GR No.
173115, April 16, 2009)
Renato Real vs. Sangu Philippines, Inc. et
al., G.R. No. 168757, 1/19/2011

Venue

Case may be filed in the RAB having


jurisdiction over the workplace of complainant
or petitioner
Where two or more RABs have jurisdiction,
venue resides in the RAB which first acquired it
No objection to venue before the filing of
position papers, issue is deemed waived
May be by written agreement, or by motion for
meritorious cases
Option of the worker

Case Flow, RAB


Start

Mandatory
Conference

File Complaint

Submit Position
Papers/Memoranda

Receive, docket and


subscribe complaint
Raffle and assign
cases
Set case for
mandatory
conference/issue
summons

Clarificatory
Hearing
Evaluate pleadings
and evidence
Issue Order
submitting case for
decision
Prepare decision

Amicable
Settlemen
t?

Issue Order

End

Issue,
promulgate and
release decision

2011 NLRC Rules of


Procedure
Significant changes from 2005 Rules (as discussed by Atty. Ruben Del
Rosario)
1. Service of Notices, Resolutions, Orders and Decisions by
Private Courier (Section 4, Rule III). Under the 2005 Rules,
service of notices such as summons, notice of conference,
resolutions, orders and decisions is made through the NLRCs
messenger or sent by registered mail only. In the 2011 Rules, service
can be done by private courier also.
2. Authority of the Labor Arbitration Associate to Conduct
Conciliation and Mediation Conference (Section 8a, Rule V).
The 2005 Rules state that the Labor Arbiter shall personally preside
over and take full control of the proceedings. The 2011 Rules state
that the Labor Arbiter may be assisted by the Labor Arbitration
Associate in the conduct of the proceedings.

2011 NLRC Rules, amendments

En Banc Resolution 11-12 amended the 2011 NLRC Rules


of Procedure.
Venue: When venue is not objected to before the first
scheduled mandatory conference, such issue or objection
will be deemed waived. (Rule IV, Section 1, par. c)
Confidentiality of Commission Records: access to
pleadings and other documents filed by parties to a case
are restricted. Reports, drafts of decisions, records of
deliberations, and other documents involving private
rights are made confidential. Nevertheless, decisions,
resolutions and orders of the NLRC are open to the parties
and their counsel or authorized representative during
office hours. (Rule XIII, Section 8)

Doctrine of Forum Non


Conveniens
Manila Hotel Corporation vs. NLRC (GR No.
120077, October 13, 2000) The NLRC has no
jurisdiction when the main aspects of the case
transpired in foreign jurisdictions and the only link
that the Philippines has with the case is that the
employee is a Filipino citizen.
PNB vs. Cabansag (GR No. 157010, June 21,
2005) when the employee is directly hired in a
foreign country but nonetheless secures a (POEA)
employment certificate, she is an OFW and thus
the case falls under the jurisdiction of the labor
arbiter.

Counter claims of
employers
Banez vs. Valdevilla (GR No. 128024,
May 9, 2000) Art. 217 (now 223) is
comprehensive enough to include claims for
all forms of damages arising from Er-Ee
relations, including Ers claims for actual
damages against a dismissed Ee.
Domondon vs. NLRC (GR No. 154376,
Sept. 30, 2005)

NLRC, Jurisdiction

Two kinds
Original Jurisdiction
Injunction in ordinary labor disputes;
Injunction in strikes and lockouts under Article 270,
LC;
Certified labor disputes in industries indispensable to
the national interest, where work stoppage is likely
or has already occurred.

Exclusive Appellate Jurisdiction


Cases decided by the labor arbiters;
Cases decided by DOLE regional directors under
Article 129;

Labor Arbiters & NLRC,


distinction of jurisdictions
NLRC has exclusive appellate jurisdiction on
all cases decided by the labor arbiters.
NLRC does not have original jurisdiction on
the cases over which labor arbiters have
original and exclusive jurisdiction.
If the labor arbiter does not exercise original
and exclusive jurisdiction over a case, the
NLRC has no appellate jurisdiction over it.

Appeals

Labor Arbiters decisions ordinary appeal


to the NLRC, w/in 10 calendar days from
receipt. NLRCs decision on appeal is
elevated to the CA by way of special civil
action (Rule 65), and then under ordinary
appeal (Rule 45) to the SC

DECISION (Supreme Court)


Petition
for
Review
(Rule 45)

Grounds: Questions
of Law from Decision
of CA
DECISION (Court of Appeals)
Grounds: determination of
whether or not the NLRC acted
without or in excess of its
jurisdiction or with grave abuse
of discretion in rendering its
decision.
DECISION on APPEAL (NLRC)

Appeal

Grounds: Section 2,
Rule VI, 2011 NLRC
Rules of Procedure,
as amended
DECISION (Labor Arbiter)

Petition
for
Certiorar
i (Rule
65)

Requisites for
Perfection: Section 4,
Rule VI, 2011 NLRC
Rules of Procedure,
as amended

Grounds of Appeal
Prima facie evidence of abuse of discretion
on the part of the labor arbiter
Decision, order or award was secured
through fraud or coercion, including graft
and corruption
Purely on questions of law
Serious errors in the findings of facts which
would cause grave or irreparable damage or
injury to appellant

Perfection of Appeal,
requisites
Filed within reglementary period (ten days
from receipt of decision by party seeking
appeal)
Under oath
Appeal fee
Posting of cash or surety bond (where
judgment involves monetary award)
Proof of service to adverse party

Appeal

Note the following:


Labor arbiter loses jurisdiction upon perfection of
appeal
Lack of verification is not fatal nor jurisdictional
Appeal is still valid despite failure to pay docket
fee, but refusal to pay despite directive is fatal
Raising new issues or changing theory on appeal
is not allowed.

Reinstatement Order

Reinstatement is immediately executory even


pending appeal
Pioneer Texturizing Corporation vs. NLRC
employer is duty-bound to inform employee
of reinstatement
An employer may not stay execution of
reinstatement, even when he has posted a
bond
Roquero vs. PAL (GR No. 152329, April
2003) - Labor arbiter has ministerial duty to
implement reinstatement order

Reinstatement by
Employer
Actual reinstatement of the employee to his
work under the same terms and conditions
prior to dismissal or separation, or
Reinstatement in the payroll of the
company, without requiring actual return to
work

Bureau of Labor
Relations

FUNCTIONS OF THE BUREAU OF


LABOR RELATIONS ABSORBED BY
NCMB

Pursuant to E.O. 126, the National Conciliation and


Mediation Board (NCMB) has absorbed the conciliation,
mediation and voluntary arbitration functions of the
BLR.
The BLR functions, as it now stands are confined
largely to union matters, collective bargaining and
labor education.
Jurisdiction over labor-management problems or
disputes is also exercised by other offices such as the
DOLE regional offices, the Office of the Secretary of
Labor, NLRC, POEA, OWWA, SSS-ECC, the regional
wage and productivity boards, NWPC, and even the
regular courts over intra-corporate disputes.

Exclusive and Original


Jurisdiction of the BLR

To act on its own initiative or upon the


request of either or both parties on all:
INTRA-union conflicts;
INTER-union conflicts; and
OTHER RELATED Labor Relations Disputes

Other Related Labor Relations


Disputes (Sec. 2, Rule XI D.O. 4003)

Shall include any conflict between a labor


organization and the employer or any
individual, entity, or group that is NOT a
labor organization or workers association.
This includes:
Cancellation of registration of unions and
workers associations; and
A petition for interpleader.

Interpleader

A proceeding brought by a party against


two or more parties with conflicting claims,
compelling the claimants to litigate between
and among themselves their respective
rights to the claim, thereby relieving the
party so filing from suits they may
otherwise bring against it. (Sec. 1 (Par. z),
Rule I, DO 40-03)

EO 251, S. 1987
removed from the jurisdiction of the BLR
all labor-management disputes. The effect
of E.O. 251 is to transfer to the NCMB the
mediation, conciliation, and arbitration
functions of the BLR.
The parties may, by agreement, settle their
differences by submitting their case to a
voluntary arbitrator rather than taking the
case to the BLR.

EO 251, S. 1987

This category of labor relations disputes as the


name suggests is related to inter/intra union
disputes to differentiate it from other labormanagement disputes, such as those under
Article 128: Visitorial and enforcement power
Article 129: recovery of wages, simple money claims
and other benefits
Article 223: Jurisdiction of the LA and NLRC
Article 273: Jurisdiction of VA
Article 277(g): Secretary of Labor, on possibility of
strikes and lockouts

Functions and Authority of BLR


under the 1987 Administrative
Code

Sec. 16. Bureau of Labor Relations The BLR shall:


Set policies, standards, and procedures on the
registration and supervision of legitimate labor
union activities including denial, cancellation, and
revocation of labor union permits;
Set policies, standards and procedures relating to
collective bargaining agreements, and the
examination of financial records of accounts of
labor organization to determine compliance with
relevant laws;
Provide proper orientation to workers on their
schemes and projects for improvement of the
standards of living of workers and their families.

Union Disputes (Rule I, DO 4003)

Intra-Union Disputes (Sec. 1(bb)) refer to any


conflict between and among union members, including
1. grievances arising from any violation of the rights and conditions
of membership,
2. violation of or disagreement over any provision of the unions
constitution and by-laws, or
3. disputes arising from chartering or affiliation.

Inter-Union Disputes (Sec. 1(x)) refer to any conflict


between and among legitimate labor organizations
involving:
1. representation questions for purposes of collective bargaining or
2. any other conflict or dispute between legitimate labor
organizations based on any violations of their rights as labor
organizations.

Coverage of Inter/Intra-Union
Disputes (Sec. 1 Rule XI, D.O. 4003)

Cancellation of registration of a labor organization


filed by its members or by any other labor
organization;
Conduct of election of union and workers association
officers/nullification of election of union and workers
association officers;
Audit/accounts examination of union or workers
association funds;
De-registration of CBA;
Validity/invalidity of union affiliation or disaffiliation;
Validity/invalidity of acceptance/non-acceptance for
union membership;

Coverage of Inter/Intra-Union
Disputes (Sec. 1 Rule XI, D.O. 4003)

Validity/invalidity of
impeachment/expulsion of union and
workers association officers;
Validity/invalidity of voluntary recognition;
Opposition to application for union and
CBA registration;
Violations of or disagreements over any
provision in a union or workers
association constitution and by-laws;

Coverage of Inter/Intra-Union
Disputes (Sec. 1 Rule XI, D.O. 4003)

Disagreements over chartering or registration of


labor organizations and CBAs;
Violations of the rights and conditions of union or
workers association membership;
Violations of the rights of legitimate labor
organizations, except interpretation of CBAs; and
Such other disputes or conflicts involving the
rights to self-organization, union membership, and
collective bargaining

Between and among legitimate labor organizations; and


Between and among members of a union or workers
association.

Complaints, where filed


DOLE Regional Office - where the labor
organization is registered;
Bureau of Labor Relations where the
complaint involves a federation or
industry/national union;

Special Requirements as to the


Filing of Cases

Involving Entire Membership


The complaint must be signed by at least 30% of
the entire membership of the union; and
It must also show exhaustion of administrative
remedies.

Special Requirements as to the


Filing of Cases

Involving a Member Only


In such case, only the affected member may file
the complaint. Redress must first be sough
within the union itself in accordance with its
constitution and by-laws EXCEPT under any of
the following circumstances:
Futility of intra-union remedies;
Improper expulsion procedure;
Undue delay in appeal as to constitute substantial
injustice;
The action is for damages;

Special Requirements as to the


Filing of Cases

Involving a Member Only


In such case, only the affected member may file the
complaint. Redress must first be sough within the union
itself in accordance with its constitution and by-laws
EXCEPT under any of the following circumstances:
Lack of jurisdiction of the investigating body;
Action of the administrative agency is patently illegal, arbitrary,
and oppressive;
Issue is purely a question of law;
Where the administrative agency had already prejudged the
case; and
Where the administrative agency was practically given the
opportunity to act on the case but did not.

Effects of Filing or Pendency of


Inter/Intra-Union Dispute and other
Labor Relations Disputes (Sec. 3, Rule
XI, D.O. 40-03)

The rights, relationships and obligations of


the part-litigants against each other and
other parties-in-interest prior to the institution of
the petition shall continue to remain during
the pendency of the petition and until the
date of finality of the decision rendered
therein. Thereafter, the rights, relationships
and obligations of the party litigants against
each other and other parties-in-interest shall be
governed by the decision so ordered.

Effects of Filing or Pendency of


Inter/Intra-Union Dispute and other
Labor Relations Disputes (Sec. 3, Rule
XI, D.O. 40-03)

The filing or pendency of any inter/intraunion disputes is not a prejudicial


question to any petition for
certification election and shall not be a
ground for the dismissal of a petition
for certification election or suspension
of proceedings for certification election.

Modes of Appeal in Intra/InterUnion Disputes (Rule XI, D.O.


40-03)
How: Formal
requirements

1. Under Oath
2. Consist of a memorandum of appeal
3. Based on either of the following grounds:
a. Grave abuse of discretion
b. Gross violation of the rules
4. With supporting arguments and evidence

Period:
To whom
appealable

Within ten days from receipt of decision


1. Bureau of Labor Relations if the case originated from
Med-Arbiter/Regional Director;
2. Secretary of DOLE in case decision originated from BLR

Where filed

Regional office or to the BLR where the complaint


originated (records transmitted to the BLR or Sec. within 24
hours from receipt of the memorandum on appeal

Summary of Rules on Inter/Intra


Union Disputes
Who:
For grounds under Section 1: any LLO members thereof
specially concerned
For grounds under Section 2: any party-in-interest
Where
RO that issued its certificate of registration or
certificate of creation of chartered local if it involves
labor unions with independent registration, chartered
locals, workers association, its officers or members.
Directly with the BLR if it involves a federation/national
union/industry union, its officers or members

Summary of Rules on Inter/Intra


Union Disputes
Formal requirements
In writing
Verified under oath
Contains:
Name, address and other personal circumstances of the complainant
or petitioner
Name, address and other personal circumstances of the respondent or
person charged
Nature of complaint or petition
Facts and circumstances surrounding complaint or petition
Causes of action
Statement on exhaustion of Administrative Remedies
Reliefs prayed for
Certification of non-forum shopping
Other relevant matters

Administrative functions of BLR


Regulation and registration of labor unions
Keeping of registry of labor unions
Maintenance of a file of CBAs
Maintenance of a file of all settlements or final
decisions of the SC, CA, NLRC and other
agencies on labor disputes

BLR has no jurisdiction over implementation or


interpretation of CBAs, which shall be subject of
grievance procedure and/or Voluntary
arbitration.

Compromise Agreements
ANY Compromise Settlement (labor
standards or labor relations law) voluntarily
agreed upon by the parties with the
assistance of the BLR or DOLE-RO shall
be final and binding upon the parties.
NLRC has no jurisdiction except:

Noncompliance with compromise agreement


Prima facie evidence that settlement was
obtained through fraud, misrepresentation or
coercion.

Compromise Agreements

Purpose: Parties agree to


Avoid litigation, or
Put an end to one already in place

How: making reciprocal concessions


Win-win

Substantial requirements
Voluntary, devoid of coercion
Not contrary to law, morals, public policy
Reasonable

Formal requirements
In writing
Signed in the presence of person before whom case is filed

Compromise Agreements

When effected:
At any stage of the proceedings, even when there
is already a final & executory judgment
EXCEPT when judgment is in process of execution

Validity: Valid and binding on both parties,


with or without DOLE assistance
Repudiation:

If done without DOLE assistance


In case of non-compliance with agreement
Prima facie evidence of fraud, misrepresentation,
coercion

Compromise Agreements

Options when agreement is violated:


Enforce compliance
Regard as rescinded, revert to original demand

Quitclaim: A formal renunciation or


relinquishing of a claim
Usually integral in compromise agreements

Compromise Agreements

Cases:
Mindoro Lumber vs. Baay, et.al., GR No. 158753,
June 2005
Veloso and Liguaton vs. DOLE, Noahs Ark Sugar
Carriers, GR No. 87297, Aug. 1991
JAG & Haggar Jeans vs. NLRC, GR No. 105710,
Feb. 1995
Magbanua vs. Uy, GR No.161003, May 2005

Veloso and Liguaton vs. DOLE,


Noahs Ark Sugar Carriers
Dire necessity is not an acceptable ground for
annulling the releases especially since it has
not been shown that the employees had been
forced to execute them. It has not even been
proven that the considerations for the
quitclaims were unconscionably low and that
the petitioners had been tricked into accepting
them. no deception has been established
on the part of the private respondent that
would justify the annulment of the petitioners
quitclaims.

Registration and
Cancellation
Labor Organizations

Definitions (Article 218)


"Labor organization" means any union or association of
employees which exists in whole or in part for the
purpose of collective bargaining or of dealing with
employers concerning terms and conditions of
employment.

"Legitimate labor organization" means any labor


organization duly registered with the Department of
Labor and Employment, and includes any branch or
local thereof.

"Bargaining representative" means a legitimate labor


organization whether or not employed by the employer.

Definitions (DO 40-03)

"Chartered Local" refers to a labor organization 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 Regional Office in accordance with Rule
III, Section 2-E of these Rules.
"Exclusive Bargaining Representative" refers to a legitimate
labor union duly recognized or certified as the sole and
exclusive bargaining representative or agent of all the
employees in a bargaining unit.
"Independent Union" refers to a labor organization operating
at the enterprise level that acquired legal personality
through independent registration under Article 234 of the
Labor Code and Rule III, Section 2-A of these Rules.

Definitions (DO 40-03)

"Labor Organization" refers to any union or association of


employees in the private sector which exists in whole or in
part for the purpose of collective bargaining, mutual aid,
interest, cooperation, protection, or other lawful purposes.
"Labor Relations Division" refers to the (1) Labor
Organization and CBA Registration Unit and (2) MedArbitration Unit in the Regional Office. The Labor
Organization and CBA Registration Unit is in charge of
processing the applications for registration of independent
unions, chartered locals, workers associations and
collective bargaining agreements, maintaining said
records and all other reports and incidents pertaining to
labor organizations and workers' associations.

Definitions (DO 40-03)

"Legitimate Labor Organization" refers to any


labor organization in the private sector
registered or reported with the DOLE in
accordance with Rules III and IV of these Rules.
"Legitimate Workers' Association" refers to an
association of workers organized for mutual aid
and protection of its members or for any
legitimate purpose other than collective
bargaining registered with the DOLE in
accordance with Rule III, Sections 2-C and 2-D
of these Rules.

Two-Fold Purpose of Labor


Organizations

Dealing with the Employer interaction


between employers and employees
concerning

Grievances
Wages
Hours
Other terms and conditions of employment

Applies even without registration

Two-Fold Purpose of Labor


Organizations

Collective Bargaining is a right acquired


through registration, and recognition or
certification as the exclusive bargaining
representative

Classifications of LOs

At the National Level

National Union/Federation
Industry Union
Trade Union Center
Alliance
Company Union

Enterprise Level
Independent Labor Union
Chapter

RA 9481
AN ACT STRENGTHENING THE WORKERS'
CONSTITUTIONAL RIGHT TO SELFORGANIZATION, AMENDING FOR THE
PURPOSE PRESIDENTIAL DECREE NO. 442,
AS AMENDED, OTHERWISE KNOWN AS THE
LABOR CODE OF THE PHILIPPINES
Amended Articles 240, 244, 245, 261, 262 &
263

Changes to Labor Code Re:


Registration of Labor
Organizations

20% membership of employees in bargaining


unit required only for independent unions
Chapters acquire legal personality (for
purposes of certification election) upon
receiving their charter certificate
Grounds of cancellation revised. Some grounds
were removed as they were not promotive of
self organization rights
Petition for Certification Election will continue
to be heard despite petition to cancel
registration

Changes to Labor Code Re:


Registration of Labor
Organizations

Cancellation may be effected by vote of


two-thirds of membership, with application
to cancel submitted to DOLE by the
organizations board
Reportorial requirements
Supervisors Union and Rank and File Unions
may join same Federation
Commingling of supervisors and rank & file
employees no longer a ground for
cancellation

Changes to Labor Code Re:


Registration of Labor
Organizations

PCEs filed by a federation on behalf of its


chapter need not identify the chapters
officers and members
Employer cannot oppose a petition for
certification election; he is considered a
bystander

Registration of Labor
Organizations
Legal personality
Enjoy the rights given to legitimate labor
organization.

Petition for certification election


Bargaining rights
Right to strike

Non-registered unions are not illegitimate or


illegal

Registration of Labor
Organization

Union registration refers to the process of


determining whether the application for
registration of a labor union organized for
collective bargaining complies with the
documentary requirements prescribed
under Rule 3 and 4 of DOLE Department
Order No. 4003and the rules
implementing Book V of the Labor Code, as
amended.

Registration of Labor
Organization

All labor unions whose members are employed in


commercial, industrial and agricultural enterprises, and
employees of government-owned and controlled
corporations without original charters established under
the Corporation Code, including religious, charitable,
medical or educational institutions whether operating for
profit or not which exist in whole and in part for collective
bargaining.
Alien employees with valid working permits issued by
DOLE may exercise their right to self-organization and join
or assist labor unions for purposes of collective bargaining
if they are nationals of a country which grants the same or
similar rights to Filipino workers, as certified by the
Department of Foreign Affairs.

Requirements, Local or
Chapter

Duly accomplished and notarized Application Form;


Charter certificate issued by the federation or
national union indicating the creation or
establishment of the local/chapter;
The names of the local/chapters officers, their
addresses and principal office of the local/chapter;
and,
The local/chapters constitution and by-laws,
provided that where the local/chapters constitution
and by-laws is the same as that of the federation or
national union, this fact shall be indicated
accordingly.

Requirements,
Independent LO
Duly accomplished and notarized
Application Form;
Minutes of Organizational Meeting and
Attendance Sheet
List of Members
Financial Report if in existence for at least
one (1) year

Requirements,
Independent LO
If less than 1 year, and has not collected
any amount, a certification to this effect.
Constitution and by-laws accompanied by
the names and signatures of ratifying
members.
Minutes of adoption or ratification of the
constitution and by-laws, date/s when
ratification was made and list of ratifying
members.

Requirements,
Independent LO
Minutes of adoption or ratification is not
required if it is done simultaneously with the
organizational meeting including the date/s
when ratification was made and list of
ratifying members.
Statement that it is not reported as a
chartered local or any federation.
List of members comprising at least 20% of
the employees of the bargaining unit.

Affiliation/Disaffiliation
The independent unions act of entering into
an agreement of affiliation with a federation
or national union, or
A chartered locals act of maintaining its
ties to a federation or national union despite
its subsequent independent registration

Requirements of Affiliation

Report of affiliation of independently


registered labor union;
Resolution of LU board approving affiliation
Total number of members, and names of those
approving affiliation
Certificate of affiliation
Written notice to the employer concerned if the
affiliating union is the bargaining agent

Chartering vs. Independent


Registration
Independent
Registration

Chartering

How obtained

Registration on its
Through charter
own accord under Art. certificate issued by
240
National
Union/Federation

Effect of disaffiliation

Retains legal
personality

Loses legal
personality

Revocation of Charter
May only occur on the grounds of disloyalty
or such grounds specified in the constitution
& by-laws;
Effected by serving a verified notice to the
local/chapter, copy the BLR
Effect

revocation of legal personality, except if local


chapter has acquired independent registration.
If covered by CBA, local chapter may be given
opportunity to register independently

BLR Action

Act on all applications within 30 days from


filing, provided all documents and papers
required have been submitted;
When DOLE refuses to register a labor
organization which has complied with the
requirements, mandamus is the proper remedy
Approval Order and Certificate of Registration
Disapproval Decision which states clearly
reasons for denial

Cancellation of
Registration
BLR has jurisdiction
Only for grounds in Article 245
Petition for cancellation will not suspend
PCE proceedings
Union may still seek just and equitable
remedies in appropriate courts

Grounds for Cancellation


Misrepresentation, false statements or fraud
in connection with the adoption or
ratification of the constitution and by-laws
or amendments thereto, minutes of
ratification and list of members who took
part
Misrepresentation, false statements or fraud
in connection with the election of officers,
minutes of the election of officers and list of
voters
Voluntary dissolution by members

Grounds for Cancellation


Ten grounds in Article 245 prior to RA 9481
have been reduced to three
Examples of removed grounds

Failure to submit reportorial requirements


Illegal strike
Engaging in cabo system

Voluntary Dissolution
May be done by members themselves
2/3 of general membership votes during a
meeting called for the purpose of dissolving
organization
Application to cancel registration submitted
by the board, attested by the president

Rights & Conditions of


Membership, LO

Article 247
a.
b.
c.
d.
e.
f.
g.
h.

Arbitrary or excessive initiation fees


Full and detailed reports
Direct election of officers
Determination of major policy affecting entire
membership of organization
Exclusion of subversive persons from membership
Exclusion of convicted member as union officer
Collection or disbursement only by authorized
officers
Receipts for all payments

Rights & Conditions of


Membership, LO

Article 247
i. Funds for authorized use only
j. Ban on unauthorized compensation on officers
k. True and correct accounting of funds
l. Inspection of records of organization
m. No unauthorized special levy or assessment of
fees
n. Check off
o. Information on the Constitution and by-laws

Rights & Conditions of


Membership, LO

Article 247can be best grouped into four


basic classifications
1. Political rights right to vote and be voted for
2. Deliberation and decision-making. Right to
participate in deliberations on major policy
questions and decide by secret ballot
3. Money matters
4. Information
1. Constitution and By-laws
2. Collective Bargaining Agreement
3. Labor Laws

Violation of Rights of Union


Members, Consequences
Cancellation of union registration, OR
Expulsion from office of a union officer.
30% of all members (if affecting entire
membership) must concur re filing of
complaint with the BLR
Only affected member/members may file a
complaint pertaining to a violation of which
they are affected

Relationship of the Union and


its Members

Ang Malayang Manggagawa ng Ang Tibay


Enterprises, et al. vs. Ang Tibay, et al., G.R.
No. L-8259, December 1957:
The relationship of the union and the members is
governed by their mutual agreement, the terms
and conditions of which are set forth in the union
constitution and by laws and binding on the
members as well as the organization itself

Prohibited as members
Non-employees (247(c))
Subversives (247(e))
What about persons convicted of crimes
involving moral turpitude?

Allowed as members, not eligible for election as


officer (247(f))

Limitations
The labor organization cannot compel employees
to become members of their labor organization if
they are already members of a RIVAL UNION
The persons mentioned in Art 247[e]
(SUBVERSIVES) of the Labor Code are prohibited
from becoming a member of a labor organization
The members of RELIGIOUS ORGANIZATION
whose religion forbids membership in labor
organization could not be compelled into union
membership (Victoriano v. Elizalde Rope Workers
Union, L-25246 September 1974)

Who are entitled to vote?

Tancino vs. Pura Ferrer-Calleja, G.R. 78131,


Jan. 1988
Only members of the union have the eligibility to
take part in the election of union officers.
Eligibility to vote may be determined through the
use of the applicable payroll period and the status
of the employees during the applicable period.
This pertains to the payroll of the month next
preceding the labor dispute, in case of regular
employees and the payroll period at or near the
peak of operation, in case of employees in
seasonal industries.

Requirements for Levy of Special


Assessments or Extraordinary Fees
Written resolution;
Approved by a majority of all members; and
Approval obtained at a general membership
meeting duly called for that purpose.
Secretary of the organization shall record
the minutes of the meeting, which shall be
attested to by the President.

list of all members present


votes cast; and
purpose of the assessment or fees

Strict Compliance Enjoined

(Palacol et aa. v Ferrer-Galleja, et al, GR No.


85222, February 6, 1990) - Substantial
compliance with the aforementioned
procedure is not enough the requirements
must be strictly complied with

Check-off

A method of deducting from an employees


pay at prescribed period, the amounts due
to the union for fees, fines or assessments

Nature and Purpose


of Check-off

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. 283 [a])

Requirements With Regard to


Check-offs (Art 241 [O])
General Rule: NO special assessment,
attorneys fees, registration fees or any
other extraordinary fees may be checked off
from any amount due an employee without
an individual written authorization duly
signed by the employee
The Authorization should specifically state
the:

Amount; and
Purpose and the beneficiary of the deduction

Exceptions
For mandatory activities provided under the
Code; and
When non-members of the union avail of
the benefits of the CBA:

Said non-members may be assessed union dues


equivalent to that paid by members;
Only by a board resolution approved by majority
of the members in a general meeting called for
the purpose

Check Off

Eduardo J. Marino, Jr. et al. vs. Gil Y. Gamilla,


et al., G.R. No. 149763, July 7, 2009: The
individual written authorization duly signed
by the employee is an additional requirement
in order that a special assessment may be
validly checked-off. In case of check-off
another requisite is necessary in addition to
the requirements for special assessment,
enumerated above and this is, individual
written authorization for check-off duly signed
by the employee concerned.

Jurisdiction over Check-Off


Disputes

Being an intra-union conflict, the Regional


Director of DOLE has jurisdiction over check
off disputes.

Union Dues

Regular monthly contributions paid by the


members to the union in exchange for the
benefits given to them by the CBA and to
finance the activities of the union in
representing them.

Agency Fees
Dues equivalent to union dues charged from
the non-union members who were benefited
by the CBA provisions.
The relationship between the non-union
employees and the Union that is the
bargaining representative is that of principal
agent
Since the union was able to secure better
terms and conditions of employment for all
employees, it is proper that they be
compensated for their representation

Requisites for Assessing Agency


Fees
The employee is part of the bargaining unit,
He is not a member of the union; and
He partook of the benefits of the CBA
Written authorization is not necessary for
collection

Union Dues vs. Agency


Fees
Union Dues

Agency Fees

Applies to Union Members

Applies to Non Members of the


Union

Paid by reason of their


membership

Paid by reason of the benefits


they enjoyed under the CBA

Written authorization is required


for dues to be deducted from
salaries (Check-Off)

Written authorization is NOT


required

Agency Fees not


Imposable
NAIBAILU

v. San Miguel Brewery Inc.,


GR No. 18170, August 31, 1963
Agency Fee cannot be imposed on employees
already in the service and are members of
another union. If a closed shop agreement
cannot be applied to them, neither may an
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 because the purpose of such dues is to
avoid discrimination between union and nonunion members.

Coverage of CBA to Include EmployeeMembers of Another Union


Members of a rival union are NOT
Considered Free Riders
When the union bids to be the bargaining
agent, it voluntarily assumes the
responsibility of representing all
employees in the appropriate bargaining
unit.

CHAPTER III. RIGHTS OF


LEGITIMATE LABOR
ORGANIZATIONS
ART.248 RIGHTS OF
LEGITIMATE LABOR
ORGANIZATIONS

Rights of A Legitimate Labor


Organization
Undertake activities for benefit of members;
Sue and be sued;
Exclusive representative of all employees;
Represent union members;
Be furnished audited financial statements
by employers;
Own properties; and
Be exempted from taxes.

ART.248-A: REPORTORIAL
REQUIREMENTS
1.

2.

Constitution and by-laws, or amendments


thereto, minutes of ratification, and the
list of members who took part in the
ratification of the constitution and by-laws
or amendments thereto;
List of officers, minutes of the election of
officers and list of voters within 30 days
from election;

ART.248-A: REPORTORIAL
REQUIREMENTS
3.

4.

Annual financial report within 30 days after the


close of every fiscal year; and
List of members at least once a year or
whenever required by the Bureau

Failure

to comply with the above-mentioned


requirements shall not be a ground for
cancellation of union registration
Erring officers or members to be suspended,
expelled from membership, or otherwise
sanctioned.

Title Five:Coverage
Art. 249: Coverage and
Employees Right to SelfOrganization

Constitutional Basis of the


Right to Self-Organization
Art. III, Sec. 8. The right of the people,
including those employed in the public or
private sectors, to form unions,
associations, or societies for purposes not
contrary to law shall not be abridged.
Art. XIII, Sec. 3. 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.

Right to Self-Organization,
Extent
To form, join and assist labor
organizations for the purpose of
collective bargaining through
representatives of their own choosing;
and
To engage in lawful concerted activities
for the same purpose or for their mutual
aid and protection (Art. 252)

Right to SelfOrganization,Coverage
All persons employed in commercial,
industrial and agricultural enterprises and in
religious, charitable, medical, or educational
institutions
Ambulant, intermittent and itinerant
workers, self-employed people, rural
workers and those without definite
Employers may form labor organizations for
their mutual aid and protection.

Right to SelfOrganization,Coverage

Art. 250 : Rights of Employees in the public


service
Employees of government corporations
established under the Corporation Code shall
have the right to organize and bargain collectively
with their respective ERs.
All other EEs in the civil service shall have the
right to form associations for the purposes not
contrary to law.

Right to SelfOrganization,Coverage

Art. 251 :
Managerial employees are not eligible to join,
assist, or form any labor organization.
Supervisory employees shall not be eligible for
membership in a labor organization of the rankand-file EEs but may join, assist or form separate
labor organizations of their own.

Examples
1. Reys Hair Salon refused to bargain with
the union of the barbershop composed of
eight barbers on the ground that the shop
was a service establishment and the number
of the barbers was less than ten. Is the
contention tenable?
No. The law does not fix the minimum
number of employees for the exercise of the
right to self-organization and the right
extends to all types of establishments.

Examples
2. Faculty members of a non-profit school
converted their club into a labor union. Is this
allowed?
Yes. Even employees in non-profit or
religious organizations are entitled to
exercise this right.

Examples
3. Is a religious sects directive to its
congregation not to join a labor union a bar
for members to form their own union?
The right of the members of a sect 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.
(Kapatiran vs. Calleja)

Supervisory Employees
Those, who, in the interest of the ER, effectively
recommend such managerial actions if in the
exercise of such authority is not merely
routinary or clerical in nature but requires the
use of independent judgment. (Art. 218)
The criterion which determines whether a
particular employee is within the definition of a
statute is the character of the work
performed rather than the title or
nomenclature of position held. (NSRC vs.
NLRC)

Supervisory Employees

If the recommendation of the teacher area supervisor is


subject to evaluation, review and final approval of the
principal, is the teacher a supervisory employee? No.
This is merely ineffective or clerical recommendation.
( Laguna Colleges vs. CIR )
Supervisors were given the job of either to assist the
foreman if the effective dispatch of manpower and
equipment or execute and coordinate work plans
emanating from his supervisors. Are these supervisors
supervisory personnel? No. They only execute approved
and established policies leaving little or no discretion at
all whether to implement the said policies or not.
(Southern Philippines Federation vs. Calleja)

Confidential Employees
assist and act in a confidential capacity to, or
have access to confidential matters of persons
who exercise managerial functions in the field of
labor relations. Philips Industrial Development
vs. NLRC, GR No. 88957, 6/25/1992;
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. Metrolab Industries vs.
Confesor, et. Al., GR No. 108855, 2/28/1996

Confidential Employees
Exempt from membership in the rank and
file bargaining unit;
They are not eligible to form, join or assist
labor organizations;
Because of the distinct nature of their work,
confidential employees are a separate
category. In this regard, there is no
discrimination against them;

Non-Abridgement of the Right


to Organize

Art. 252 speaks of the illegality of the


following acts with respect to the exercise
to the right of self-organization

Restraint
Coercion
Discrimination
Undue interfere with employees and the workers
in their exercise of self-organization right

Non-Abridgement of the Right


to Organize

Alexander Reyes vs. Cresenciano Trejano , GR


No. 84433, June 1992. The right to self-organization
includes the right not to form or join a union
Airtime Specialists vs. Ferrer- Calleja, (180 SCRA
179). The intendment of the law is to grant to bonafide employees of a bargaining unit, whether
members of a labor organization or not, the right to
vote in certification elections
However, by virtue of the operation or enforcement of
a closed shop clause in a CBA, an employee may be
compelled under pain of dismissal, to become a
member of a labor union.

Non-Abridgement of the Right


to Organize
May an ER impose as condition for
employment that the applicant shall not join
a labor organization or shall withdraw from
the one he belongs to?
No. Such a condition partakes of the nature
of a yellow dog contract and constitutes
an unfair labor practice. It is interference
with the individuals right to selforganization.

Non-Abridgement of the Right


to Organize

SPFL v. Calleja, 179 SCRA 127, GR No.


80882, April 1989. The right to selforganization must be upheld in the absence
of express provision of law to the contrary. It
cannot be curtailed by a Collective
Bargaining Agreement

Labor Code Provisions on Unfair


Labor Practices
Art. 253 concept of ULP and procedure for
prosecution
Art. 254 ULP by employers
Art. 255 ULP by labor organizations
Art. 267 CBA violations which are gross in
character
Art. 270(c) union busting involving
dismissal of union officers which threatens
existence of union

Elements of Unfair Labor


Practice
Concurrence of BOTH
1. There should exist an employer-employee
relationship between the offended party
and offender
2. Act complained of must be EXPRESSLY
mentioned and defined in the Labor Code

ULP of Employers
Interference, restraint, coercion of
employees in the exercise of their right to
self organization;
Yellow dog contract
Contracting out services or functions
performed by union members, that
interfere, restrain or coerce employees in
the exercise of their right
Company union

Company Union
Initiate, dominate, assist or otherwise
interfere with the formation or
administration of any labor organization
Includes giving of financial or other support
to it or its organizers or supporters

ULP of Employers

Discrimination
Wages, hours of work, terms and conditions of
employment
Except with respect to Union Security Clauses

Dismissal or prejudice or discrimination by


reason of testimony
Violation of duty to bargain
Payment of Negotiation or Attorneys Fees
to the Union, its officers or agents
Violate CBA

ULPs of Labor
Organizations

Restraint or coercion of employees in the


exercise of their right
Causing or attempting to cause employer to
discriminate against an employee
Violate duty, or refuse to bargain collectively
with employer
Causing or attempting to cause employer to
pay or deliver any money or other things of
value for services which are not performed,
including demand for union negotiation fees
(Feather-bedding)

ULPs of Labor
Organizations
Ask for or accept negotiation or attorneys
fees from employers as part of settlement
of any issue in collective bargaining or any
other dispute
Violation of a CBA

Criminal Liability for ULPs


Only officers or agents of corporations,
associations or partnerships who actually
participated in, authorized or ratified ULPs
to be held criminally liable
On the part of the Union, its officers,
members of governing boards,
representatives or agents

Totality of Conduct
Doctrine

Expressions of opinion by an employer,


though innocent in themselves, may be
constitutive of ULP because of the
circumstances under which they are
uttered, the history of the employers labor
relations or anti-union bias or because of
their connection with an established
collateral plan of coercion or interference.

Union Security Clause


Stipulation in the CBA where management
recognizes membership of employees in the
union which negotiated said agreement
should be maintained or continued as a
condition of employment or retention of
employment
Purpose is to safeguard and ensure
continued existence of the union

Union Security Clause,


Types
Closed shop
Maintenance of membership agreement
Union shop agreement
Modified union shop
Exclusive Bargaining Agreement
Bargaining for members only agreement
Agency shop agreement
Preferential hiring agreement

Legal Principles Pertinent to


Union Security Clause

Employer must still afford employee due


process

Collective bargaining and


administration of
agreement

Collective Bargaining

A process by which the representatives of


an employer and its employees to discuss
and negotiate concerning wages, hours of
work, benefits and other terms and
conditions of employment for the purpose
of concluding a contract that is mutually
acceptable to the parties.

Collective Bargaining
A democratic framework to stabilize Er-Ee
relations, to create a climate of sound and
stable industrial peace
A mutual responsibility & legal obligation of
the employer and the union
Collective bargaining denotes negotiations
looking forward to a collective agreement,
however, it is a continuous process.

Collective Bargaining,
Process
Negotiation of wages, hours & terms,
conditions of employment
Execution of written contract embodying
terms
Negotiation of issues arising out of
interpretation or application of agreement
Negotiation of terms of new contract, or
proposed modifications.

Collective Bargaining,
Process

System of collective bargaining consists of:


Negotiation of contracts (legislative phase)
Administration of contract (executive phase)
Interpretation or application (judicial phase)

Collective Bargaining, Process


(Article 260, 261, Labor Code)
Party seeking negotiation
serves written notice &
statement of proposals

Engaged Party makes reply


thereto within 10 calendar
days from receipt of notice

Conciliation proceedings
by NCMB to resolve
dispute, either motu
proprio or upon request

Request for conference


within 10 calendar days to
address differences in
proposals

Collective Bargaining
Agreement
A contract
executed upon request of either the
employer or the exclusive bargaining
representatives
Incorporating all agreements reached
during negotiations

With respect to wages, hours of work and other


terms and conditions of employment
Including proposals for adjusting any grievance or
questions under such agreement

Collective Bargaining
Agreement
Azucena:
It is more than a contract; it is a
generalized code to govern a myriad
cases which the draftsmen cannot wholly
anticipate. It covers the whole
employment relationship and prescribes
the rights and duties of the parties. It is
a system of industrial self-government
with the grievance machinery at the very
heart of the system.

Collective Bargaining,
Process

Management may only be compelled to deal


and negotiate when the following juridical
preconditions are present:
1. Possession of status of majority representation
by the Ees representative, in accordance with
Art. 266-271 of the Labor Code
2. Proof of majority representation
3. Demand to bargain
ALU vs. Ferrer-Calleja, 173 SCRA 178

Collective Bargaining,
Parties
Employer Where there is no
relationship, there
is no duty to
bargain,

Where there is no
duty to bargain,
refusal to bargain
violates no right. Employees (thru SEBA)

Collective Bargaining,
Parties

Bargaining Representative
Refers to the Legitimate Labor Organization
selected or designated by the employees. Does
not refer to its officers.
How selected is discussed under Articles 266-271
of Labor Code
See Phil. Diamond Hotel & Resort vs. MDHEU
G.R. No. 158075, June 30, 2006: Only LOs
designated or selected by the majority of the
employees in an appropriate bargaining unit may
engage the employer for collective bargaining

Selection or Designation of
Exclusive Bargaining Agent
Manifestation of workers participatory right
PAL vs. NLRC (GR No. 85985, Aug. 1993) The
CBA may not be interpreted as cession of
employees right to participate in the deliberation
of matters which may affect their rights and
the formulation of policies relative thereto.
May be exercised by a Labor-Management
Council, aside from or instead of a union (dealing
with the employer vs. collective bargaining)
Does not preclude the exercise of an individual
employees right to raise his own grievance.

Collective Bargaining Unit


That group of jobs and jobholders
represented by the recognized or certified
union when it bargains with the employer.
May comprise all of the supervisors or,
separately, all the rank-and-file population
of the company.
The law favors having only one grouping
per category (following the united-westand, divided we fall logic), but does not
prohibit sub-groups that are appropriate.

CBU, Under DO 40-03

Refers to a group of employees sharing


mutual interests within a given
employer unit, comprised of all or less
than all of the entire body of employees in
the employer unit or any specific
occupational or geographical grouping
within such employer unit.

What is Appropriateness?
BLRs primary function, considering all
legally relevant factors.
Bargaining Unit may be determined
following the four recognized modes:

1. Substantial Mutual Interests principle or


community or mutuality of interests rule
2. Will of the Employees (Globe Doctrine)
3. Collective Bargaining History
4. Employment Status

Substantial Mutual Interests


Rule
Employees sought to be represented must
have substantial mutual interests in
terms of employment and working
conditions
Characterized by similarity of employment
status, same duties and responsibilities and
substantially similar compensation and
working conditions.

Substantial Mutual Interests


Rule

There must be a logical basis for the formation


of a bargaining unit.
Adherence to the adage Strength in Numbers
Geographical location can be completely
disregarded if communal or mutual interests of
the employees are not sacrificed.
However, if employers in two plants are clearly
distinct, each group of employees in the plants
are treated as separate units (Diatagon vs.
Ople)

Cases, Substantial Mutual


Interests
SMC Employees Union vs. Confesor, (GR No.
111262, Sep. 1996)
Philtranco Service Enterprises vs. BLR, (GR
No. 85343, Jun. 1989)
SMC vs. Laguesma (GR No. 100485, Sep.
1994)
SMC Supervisors and Exempt Employees
Union vs. Laguesma (GR No. 110399, Aug.
1997)

Cases, Substantial Mutual


Interests

St. James School of Quezon City vs.


Samahang Manggagawa sa St. James
School of Quezon City (GR No. 151326, Nov.
23, 2005)

Globe Doctrine
Globe Machine and Stamping Co., 3 N.L.R.B. 294
(1937),
A petitioning union claimed that there were three
separate bargaining units in the plant, whereas an
intervening union argued for treating the plant as one
overall unit.
The US NLR Board found that either arrangement
would result in appropriate bargaining units, and
concluded that the question was so evenly balanced
that the determining factor should be the desire of
the employees themselves.

Globe Doctrine
Globe Machine and Stamping Co., 3 N.L.R.B. 294
(1937),
Each of the three separate units was given the
opportunity to vote for the petitioning union (and
representation as a separate unit), the intervening
union (and representation as an overall unit), or no
union.
The Globe procedure thereby allows employees
"to determine the scope of a unit by allowing them
to cast a vote for each of several potential units
which the Board has determined are appropriate."

Globe Doctrine
US Case: Globe Machine & Stamping Co. (3
NLRB 294, 1937)
In defining the appropriate bargaining
unit, the determining factor is the
desire of the workers themselves.
Consequently, a certification election
should be held separately to choose
which representative union will be
chosen by the workers.

Collective Bargaining
History
Prior collective bargaining history and
affinity of employees should be considered
in determining the appropriate bargaining
unit.
The existence of a prior collective
bargaining history is neither decisive nor
conclusive in the determination of what
constitutes an appropriate bargaining unit
(see SMC vs. Laguesma, NAFTU vs. Mainit
Lumber Devt. Company Workers Union)

CB History vs. Mutuality of


Interest

NAFTU vs. Mainit SC applied mutuality of


interest among workers in sawmill division
and logging division, despite the history of
divisions being treated as separate units
and geographical distance (see also SMC vs.
Laguesma)

Employment Status
Casual employees and those employed on
day-to-day basis must be considered
separate because there is no mutuality of
interest (Philippine Land-Air-Sea Labor
Union vs. CIR, GR No. L-14656, Nov. 1960)
Confidential employees cannot be allowed
to be included in rank-and-file bargaining
units
Belyca Corporation vs. Ferrer-Calleja (GR
No. 77395, Nov. 1988)

Selection of Bargaining
Representative
Certification Election
Consent Election
Voluntary Recognition

Certification Election

Process of determining by secret ballot


the sole and exclusive bargaining agent
of the employees in an appropriate
bargaining unit, for purposes of
collective bargaining.

Certification Election

No longer necessary under the following


circumstances
Voluntary recognition of the employer
Employees designate the union as the bargaining
representative

Certification Election,
Requisites

Organized establishments
Petition questioning the majority status of the
incumbent bargaining agent is filed with the
DOLE during the 60-day freedom period
Verification of Petition necessary
Support of at least 25% of all employees in
bargaining unit

In unorganized establishments, certification


election shall be automatically conducted
upon the filing of a petition by a legitimate
labor organization

Party Filing Certification


Election

Legitimate labor organization, or


Employer, when requested by a labor
organization to bargain and status of
organization is in doubt.
Note: Art. 264-A Employer is a bystander in
petitions of certification election. Employers
participation limited to:
Being notified or informed of petitions of such
nature
Submitting list of employees to Med-Arbiter during
pre-election conference

Petition for Certification


Election

May be filed at any time in the absence of a


CBA, except:
Certification year-bar rule
Bargaining deadlock bar rule
Contract bar rule

Petition for Certification


Election

Certification year-bar rule A certification


election may not be filed within one year
from the date of a valid certification,
consent or run-off election, or one year from
the date of voluntary recognition.

Petition for Certification


Election

Bargaining deadlock-bar rule.


Before the filing of a petition for certification
election, the duly recognized or certified union
has commenced negotiations with the employer
within the one-year period from the date of a valid
certification, consent or run-off election or
voluntary recognition.
A bargaining deadlock to which an incumbent or
certified bargaining agent is a party had been
submitted to conciliation or arbitration or become
the subject of a valid notice of strike or lockout.

Cases, Bargaining Deadlock


Rule
Kaisahan ng Manggagawang Pilipino
(Kampil-Katipunan) vs. Trajano (GR No.
75810, Sept. 1991)
Capitol Medical Center Alliance of
Concerned Employees-USFW vs. Laguesma
(GR No. 118915, Feb. 1997)

Contract Bar Rule

The BLR shall not entertain any petition for


certification election or any other action
which may disturb the administration of
duly registered existing collective
bargaining agreements affecting the
parties.

Exceptions

60-day Freedom Period


CBA is not registered with the BLR
CBA contains provisions lower than statutory
standards
Falsified, fraudulent or misrepresented documents
Incomplete CBA
Collective bargaining and negotiations entered
into prior to the 60-day freedom period
Internal strife in the union resulting in an industrial
dispute which does not foster industrial peace.

Petition for Certification Election,


Other Grounds for Dismissal
Petitioner is not listed in DOLEs registry of
legitimate labor organizations, or whose
registration is revoke or cancelled with
finality
Petition filed outside of freedom period,
provided that the 60 day period based on
the original CBA shall not be affected by
any amendment, extension or renewal of
the CBA
Failure to submit 25% support requirement
for filing of petition

Consent Election

Voluntarily agreed upon by the parties with


or without the intervention of the DOLE

Distinction, Certification Election


vs. Consent Election
Certification Election to determine the sole
and exclusive bargaining agent of all the
employees in an appropriate bargaining unit
for the purpose of collective bargaining;
Consent Election to determine the issue of
majority representation of all workers in the
appropriate collective bargaining unit mainly
for the purpose of determining the
administrator of the CBA; not for the purpose
of determining the bargaining agent for
purposes of collective bargaining.

Voluntary Recognition
Process whereby the employer recognizes a
labor organization as the exclusive
bargaining representative of the employees
in the appropriate bargaining unit after a
showing that the labor organization is
supported by at least a majority of the
employees in the bargaining unit.
Available only in unorganized
establishments.

FAQs
1.

2.

What is Certification Election? - Certification


election is a process of determining through secret
ballot the sole and exclusive bargaining agent (SEBA)
of all the employees in an appropriate bargaining
unit for the purpose of collective bargaining.
Where does a union file a petition for
certification election (PCE)? - A PCE is filed at the
Regional Office which issued the certificate of
petitioning unions certificate of
registration/certificate of creation of chartered local.

FAQs
3.

What are the requirements in filing a PCE? - Among the


important requirements are the following:
a. A statement indicating any of the following:
. That the bargaining unit is unorganized or that there is no registered CBA
covering the employees in the bargaining unit;
. If there exists a duly registered CBA, that the petition is filed within the
sixty-day freedom period of such agreement;
. If another union had been previously recognized voluntarily or certified in a
valid certification, consent or run-off election, that the petition is filed
outside the one-year period from entry of voluntary recognition or conduct
of certification or run-off election and no appeal is pending thereon.
b. In an organized establishment, the signature of at least twenty-five (25%)
percent of all employees in the appropriate bargaining unit shall be
attached to the petition at the time of its filing (Section 4, Rule VIII, of the
Department Order No. 40-03).

FAQs
4.

5.

6.

What happens after receipt of the PCE? - The petition will be raffled
to the Med-Arbiter for preliminary conference to determine, among
others, the bargaining unit to be represented, the contending unions, and
the possibility of consent election.
What happens upon approval of the conduct of certification
election by the Mediator-Arbiter? - The PCE will be endorsed to an
election officer for the conduct of pre-election conference wherein the
date, time and place of election will be identified, the list of challenged
and eligible voters will be made, as well as the number and location of
polling places.
May a PCE be denied? - Yes, if:
a. filed before or after the freedom period of a registered CBA;
b. the petitioner union is not listed in the DOLE Registry of legitimate labor
organization; or
c. the legal personality of the petitioner-union has been revoked or cancelled with
finality.

FAQs
7.

8.

9.

10.

Who conducts CEs? - The DOLE Regional Office through


the election officer conducts the certification election.
How is the SEBA determined? - The union that garners
majority of the valid votes cast in a valid certification
election shall be certified as the SEBA.
May election protest be entertained? - Yes, but
protest should have been first recorded in the minutes of
the election proceedings.
What happens if the petitioner union fails to garner
the majority of the valid votes cast? - There will be no
SEBA, but another PCE may be filed one year thereafter.

FAQs
11.

What are the requisites for certification election in


organized establishments? - Certification election in organized
establishments requires that:

a. a)a petition questioning the majority status of the incumbent bargaining


agent is filed before the DOLE within the 60-day freedom period;
b. b)such petition is verified; and
c. c)the petition is supported by the written consent of at least twenty-five
percent (25%) of all employees in the bargaining unit.
12.

What is the requirement for certification election in


unorganized establishments? - Certification election in
unorganized establishments shall automatically be conducted
upon the filing of a petition for certification election by an
independent union or a federation in behalf of the chartered local
or the local/chapter itself.

FAQs
13.

14.

15.

May an employer file a PCE? - Yes, the employer may file a PCE
if it is requested to bargain collectively.
May an employer extend voluntary recognition to a
legitimate labor organization without filing a PCE? - Yes,
management may voluntarily recognize a union if there is no
other union in the company and if other requirements are
complied with (Sec. 2, Rule 7 of D.O. 40-03).
What is the role of employer in certification election? - The
employer shall not be considered a party to a petition for
certification election, whether it is filed by an employer or an LLO,
and shall have no right to oppose it. Its participation shall be
limited only to being notified or informed of petition for
certification election and submitting the certified list of employees
or where necessary, the payrolls (Employer as Bystander Rule).

Collective Bargaining
Agreement
A negotiated contract between a legitimate
labor organization and the employer
concerning wages, hours of work and all
other terms and conditions of employment
in a bargaining unit
Deemed as the law between the parties
during its lifetime
Provisions are construed liberally

Legal Principles Applicable to


CBA
A proposal not embodied in the CBA is not part thereof
Minutes of CBA negotiation have no effect if not
incorporated in the CBA
Making a promise during the CBA negotiation is not
considered bad faith
Adamant stance resulting in impasse is not bad faith
No terms and conditions may be imposed by the DOLE
or any other agency which the law and the parties did
not intend to reflect in the CBA
Signing bonus is not demandable under the law
Allegations of bad faith are erased with the signing of
the CBA

Collective Bargaining, Kinds

Single Enterprise
Between on certified labor union and one employer

Multi-Employer Bargaining
Between and among several certified labor unions
and employers
Conditions
Only LLOs that are the SEBA may participate and
negotiate
Only employers with counterpart LLOs which are
incumbent bargaining agents may participate
Employers must consent to multi-enterprise
bargaining may participate

Duty to Bargain
Collectively

Where there is yet no CBA:


Compliance to Article 256, LC
Er and union must MEET, CONVENE and CONFER
for collective bargaining purposes
Requisites of collective bargaining must be
complied with
Er-Ee relationship
Majority status of bargaining union
Demand to negotiate

Advantage where the negotiations have no


precedent CBA: Clean slate, unencumbered by
previous agreements

Duty to Bargain
Collectively

Where there exists a CBA


Neither party shall terminate nor modify such
agreement during its lifetime.
Parties may serve notice to terminate or modify
agreement during freedom period
Parties to keep the status quo during freedom
period until new agreement is reached.

Requisites in Relation to
CBA

Posting of CBA
Posted in two conspicuous places in the work
premises, at least five days prior to ratification
Mandatory requirement; non-compliance will
result in ineffectiveness of CBA (ATU vs. Trajano,
1988)
Employer responsible for posting (ALU vs. FerrerCalleja, May 1989)

Ratification by Majority of Employees in


Bargaining Unit
Registration of CBA

Refusal to Negotiate
Ignoring all notices for negotiation and
requests for counter-proposals
Refusing to bargain anew on economic
terms of the CBA, using flimsy excuses such
as questioning union
Not serving an answer
All the above are indications of bad faith

Refusal to Negotiate
Employer who violates the duty to bargain
collectively loses its statutory right to
negotiate or renegotiate terms and
conditions of the draft CBA; and may
impose the adoption of the proposals of the
union as the CBA
Cases

General Milling Corporation vs. CA,


Kiok Loy vs. NLRC
Divine Word University of Tacloban vs. SOLE

Lifetime of a CBA
Representation aspect 5 years, meaning
no petition questioning the majority status
of the incumbent agent shall be entertained
by DOLE
Economic and non-economic provisions
except representation renegotiated not later
than three years after its execution

Retroactivity of CBA

New CBA concluded by negotiation


The CBA or other provisions of such agreement
entered into within 6 months from expiration of
term shall retroact to the day immediately
following date of expiration
If entered into beyond 6 months, parties shall
agree on effectivity

CBA concluded through arbitral award


LMG Chemicals Corporation vs. Secretary of
DOLE, (GR No. 127422, April 2001)

Breaking the Deadlock


Conciliation and Mediation with NCMB,
DOLE
Declaration of Strike or Lockout
Referral to conciliation or voluntary
arbitration

Grievance and
Voluntary Arbitration

Grievance

Any question by Er or union regarding


interpretation or application of the CBA, or
company personnel policies, or
Any claim by either party that the other party is
violating the CBA or company personnel policies.

Complaint or dissatisfaction arising from the


interpretation or implementation of CBA and
those arising from interpretation or
enforcement of personnel policies.

Grievance Machinery

Refers to mechanism for the adjustment


and resolution of grievances arising from
the interpretation or implementation of a
CBA and those arising from the
interpretation and enforcement of company
personnel policies.

Grievance Procedure
Internal rules of procedure established by
the parties in their CBA with voluntary
arbitration as the terminal step.
Refers to the system of grievance
settlement at the plant level as provided in
the CBA.
Consists of successive steps starting at
complainant and his immediate supervisor,
up to the level of top union and company
officials

Grievance Procedure
All grievances submitted to the grievance
machinery that are not settled in seven
calendar days from submission shall be
referred to Voluntary Arbitration prescribed
in the CBA
Voluntary Arbitrators shall be named and
designated in advance, or include a
procedure for selection of VAs.
In case parties fail to select VA, NCMB shall
designate

Voluntary Arbitration
Mode of settling labor-management
disputes
Parties select a competent, trained and
impartial third person
Decision based on merits of the case
Decision is final and executory

Voluntary Arbitration vs.


Court
Voluntary Arbitration

Courts of Law

Proceedings may be Informal

Proceedings are Formal

Precedents set by other


arbitration not obligatory on VAs

Doctrine of Stare Decisis

Rules on evidence are not


imposed, hence arbitrator
determines what is admissible

Rules on evidence outline points


of admissibility of evidence

Arbitrators are highly specialized

Judges considered as generalists

Arbitrable Disputes

Contract-negotiation disputes
Terms and conditions of contracts
Collective bargaining issues
Known as arbitration of interest

Contract interpretation disputes


Arises out of existing CBAs
Known as arbitration of grievance or rights

Interplay of Jurisdiction, Labor


Arbiters vs. Voluntary Arbitrators
Jurisdiction of LA Article 223
Jurisdiction of VA- Article 267, 268
Interpretation or implementation of CBA are
disposed of by LAs by referring the matter
to the grievance machinery, of which the
terminal step is voluntary arbitration
Under Article 268, VAs may, upon voluntary
agreement of the parties hear and decide
ALL other labor disputes including ULP and
bargaining deadlocks

Interplay of Jurisdiction, Labor


Arbiters vs. Voluntary Arbitrators

Termination disputes may fall within the


jurisdiction of VAs, provided that the parties
had agreed in unequivocal language that
the termination dispute would be referred to
the grievance machinery and voluntary
arbitration.

Cases
San Jose vs. NLRC & Ocean Terminal
Services (GR 121227, Aug. 1998)
San Miguel Corporation vs. NLRC
Sanyo Philippines Workers Union vs.
Canizares, GR No. 101619, July 1992

Voluntary Arbitrator
Any person accredited by NCMB as such, or
Any person named or designated in the CBA
as such, or
One appointed by the NCMB in case either
party refuses to submit to voluntary
arbitration

Note that VAs are not part of DOLE or any


government agency. His authority to render
arbitral awards are vested by law.

Enforcement of VAs
Decision

Article 268-A: Upon motion of any interested


party, the VA may issue a writ of execution
requiring the sheriff of the NLRC or regular
courts or public officials whom the parties
may designate in the submission agreement

Strikes, Lockouts and


Picketing

Concerted Activities
People planning and acting together
One undertaken by two or more employees,
or by one on behalf of others.

Strikes
Temporary stoppage of work by the
concerted action of the employees as a
result of an industrial or labor dispute.
Consists not only of concerted work
stoppages but also sitdowns, mass leaves,
slowdowns, attempts to damage, destroy or
sabotage plant equipment or facilities and
similar activities.

Strikes
Cessation of work by employee in an effort
to get more favorable terms for
employment
Concerted refusal by employees to do any
work for their employer, or work at their
customary rate of speed until the object of
strike is attained by employers concession

Characteristics of Strikes
Established relationship between strikers
and persons against whom the strike is
called
Relationship must be of employer-employe
Existence of dispute between the parties
and the utilization by labor of the weapon of
concerted refusal to work as a means of
persuading or coercing compliance to
demands

Characteristics of Strikes
Even though work cessation is by
belligerent suspension, Employment
relations still continue
Work stoppage is temporary
Concerted action by employees
Striking group is a LLO, and in the case of
bargaining deadlock, the sole bargaining
representative

Lockout

Temporary stoppage of work by reason of


refusal of an employer to furnish work as a
result of an industrial or labor dispute

Lockout
An employers means of protecting his
bargaining position
Employer must show that his act is primarily
defensive, and not an act of hostility to
collective bargaining or of discriminaiton.

Valid Lockouts
To forestall threatened acts of sabotage
(Rizal Cement Workers Union vs. Madrigal
Co.)
In anticipation of a threatened strike where
motivated by economic considerations
In response to unprotected strike or walkout
In response to a whipsaw strike

Picketing

A right given to workers to peacefully march


to and from before an establishment
involved in a labor dispute accompanied by
the carrying and display of signs, placards
and banners intended to inform the public
about the dispute.

Picketing Allowed by Law

Included in the constitutional guarantee


to engage in concerted activities for purposes of
collective bargaining for their mutual benefit and
protection
Freedom of speech principle

Can be performed by persons even in the


absence of Er-Ee relationship

Limitations
Right to peaceful picketing should be
exercised with due respect to the right of
others; coercion, intimidation or acts of
violence are strictly prohibited
Picketers cannot rightfully prevent
employees of another company which is not
their employer from entering or leaving
their rented premises (innocent bystander)

Kinds of Strikes

Extent
General occur over a whole community,
province, state or country. An extended form of
sympathetic strike; many workers stop working to
put pressure on government or paralyze economic
& social systems
Local or Particular applies only in a particular
enterprise or locality

Kinds of Strikes

Nature of the Act


Sitdown Strike Possession, trespass and
prevention of access and operation
Slowdown reduction of production output
Partial or quickie strike intermittent,
unannounced work stoppage; used
interchangeably with wildcat strike

Kinds of Strikes

Employee Interest
Primary Strike declared by employees who have a
direct and immediate interest in the subject of the
dispute between them and the Er
Secondary Strike Coercive measure adopted by
workers against an employer connected by product
or employment with alleged unfair labor conditions or
practices
Sympathetic Strike striking employees have no
demands or grievances of their own, but strike to
directly or indirectly aid others without direct relation
to the advancement of the interest of the strikers.

Kinds of Strikes
Economic Strike one intended to force
wage and other concessions from the
employer, which he is not required by law to
grant.
Unfair Labor Practice Strike called against
the ULP of the employer, usually for the
purpose of making him desist from further
committing such practices. Called for
mutual protection, and for the
discontinuance of employer abuses.

Avoidance of Strikes
Parties must first exhaust measures or
remedies that will avoid the strike, akin to the
doctrine of Exhaustion of Administrative
Remedies.
Only when non-disruptive alternatives have
proved unsuccessful may strikes be deemed
justified.
Jumping the gun on the grievance
procedure/voluntary arbitration of a dispute
will mean that the strike is PREMATURE, thus
illegal

Avoidance of Strikes
Once an issue has been submitted for
conciliation, mediation or compromise, the
employees cannot resort to a strike.
Discussions during conciliation proceedings
are confidential and treated as privileged
information
Parties can enter into compromise
agreements to avoid a strike, which
compromise shall be immediately final and
executory.

Labor Code Provisions


Protecting the Right to Strike
Art. 260 Not subject to labor injunction or
restraining order
Art. 254 No discrimination against striker
in the exercise of the right
Art. 270(a) Preservation of employment
relationship
Art. 270(c) Prohibition on Strike-breakers

Strikes, Mandatory
Requisites
First requisite: Valid and factual ground
(1) CBA Deadlock; and
(2) Unfair labor practice (ULP).
Second Requisite: Notice (of Strike or
Lockout)
(1) CBA Deadlock - 30 days from intended
date of strike
(2) Unfair labor practice (ULP) 15 days.

Strikes, Mandatory
Requisites
Third requisite: Notice to NCMB-DOLE at least
24 hours prior to the taking of the strike or
lockout vote (secret ballot)
Decision to conduct vote
Date, time and place
Fourth Requisite: Strike or Lockout Vote
Majority approval required
Must be implemented even in cases of
union-busting

Strikes, Mandatory
Requisites
Fifth requisite: Strike/Lockout Vote Report
Submitted at least seven days prior to strike/lockout
If report submitted during cooling off period, seven day
waiting period begins on the day following the cooling
off period
If for union busting, cooling period may be dispensed
with
Sixth Requisite: Cooling Off Period
Reckoned from filing of notice of strike/lockout
30 days for deadlock, 15 for ULP
If strike is for union-busting, period is dispensed with

Strikes, Mandatory
Requisites
Seventh requisite: Waiting period
Seven days from submission of strike vote
report

Nota Bene: Strike Rules


1.

2.

3.

4.

5.

Failure to comply with requisites will render the strike or


lockout illegal.
A strike or lockout based on non-strikeable issues is
illegal
A strike or lockout is illegal if the issues involved are
already subject of compulsory or voluntary arbitration or
conciliation or the steps in grievance machinery are not
exhausted.
A strike or lockout is illegal if unlawful means were
employed or prohibited acts or practices were committed
(e.g., Use of force, violence, threats, coercion, etc.;
Barricades, blockades and obstructions of ingress to
[entrance] or egress from [exit] the company premises).
A strike or lockout is illegal if the notice of strike or notice
of lockout is already converted into a preventive
mediation case.

Nota Bene: Strike Rules


6.

7.

8.
9.

10.

A strike or lockout is illegal if staged in violation of the


No-Strike, No-Lockout clause in the collective
bargaining agreement.
A strike or lockout is illegal if staged in violation of a
temporary restraining order or an injunction or
assumption or certification order.
A strike is illegal if staged by a minority union.
A strike or lockout is illegal if conducted for unlawful
purpose/s (e.g.: Strike to compel dismissal of employee
or to compel the employer to recognize the union or
the so-called Union-Recognition Strike)
The local union and not the federation is liable to pay
damages in case of illegal strike.

Preventive Mediation

The NCMB has the authority to convert a notice of strike


filed by the union into a preventive mediation case if it finds
that the real issues raised therein are non-strikeable in
character.
NCMB has duty to exert all efforts at mediation and
conciliation to enable parties to settle the dispute amicably
and in line with the state policy of favoring voluntary modes
of settling labor disputes.
Once a notice of strike/lockout is converted into a preventive
mediation case, it will be dropped from the docket of notices
of strikes/lockouts.
Once dropped therefrom, a strike/lockout can no longer be
legally staged based on the same notice. The conversion
has the effect of dismissing the notice.

Illegal Strikes
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

Those that are expressly prohibited by law


Does not comply with statutory requirements
Declared for an unlawful purpose
Employs unlawful means
In violation of an existing injunction
In violation of assumption or certification order
Violation of no-strike, no-lockout clause
Minority union calls strike
Strike by a non-registered union
Premature strike

Assumption of Jurisdiction
Occurs when labor dispute that caused or
may cause strike is in an industry
indispensable to the national interest
DOLE Secretary assumes jurisdiction and

May decide the case, or


Certify the same to the NLRC for compulsory
arbitration

The power of assumption of jurisdiction over


labor disputes in these industries is in the
nature of the POLICE POWER measure

Effects of Assumption
Automatically enjoins intended or impending
strike or lockout
All striking or locked out employees shall
return to work immediately

Note that striking employees are not considered to


have abandoned their employment, but only ceased
from their labor

Employer shall resume operations and admit


all workers under same conditions pre-strike
No Motion for Reconsideration will stay the
assumption order

Wages to be paid during


strike
No work, no pay rule applied
Exceptions

ULP strike
Unconditional and voluntary offer to return to
work is refused by employer
Employees are discriminated against despite a
RTWO
Non-participating employees were locked out by
employer
Reinstatement no longer possible

Prohibited Activities

Article 270 - Note prohibitions on:

Labor Organizations
Third Persons
Employers
Public Officials or Employees
Picketers

Return to Work Order


Enjoins striking workers to RETURN TO
WORK
Defiance of RTWO is considered an illegal
act
Strike becomes illegal
Defiant strikers may be sanctioned with
disciplinary measures, e.g. dismissal or loss
of employment status or criminal
prosecution

Improved Offer Balloting


NCMB shall conduct a referendum by secret
ballot on or before 30th day of the strike;
If majority of union members accept offer

Striking workers shall return to work immediately


Employer readmits striking workers upon signing
of agreement

Initiated when EMPLOYER makes an offer


that is, in his opinion, better than his
previous stance in the labor dispute

Reduced Offer Balloting

NCMB shall conduct a referendum by secret


ballot on or before 30th day of the lockout;
If majority of board members, trustees or
directors accept offer
Locked out workers shall return to work
immediately
Employer readmits workers upon signing of
agreement

Initiated when STRIKERS make an offer that


is, in their opinion, more acceptable than
their previous stance in the labor dispute

Post Employment
Security of Tenure
Management Prerogatives
Termination of Employment

Security of Tenure &


Kinds of
Employment

Security of Tenure
Defined: The constitutional right granted
the employee that the employer shall not
terminate the services of an employee
except for JUST CAUSE, or when
AUTHORIZED BY LAW.
It extends to regular (rank and file,
managerial) as well as non-regular
employment (probationary, seasonal,
project)
Applies as protection from unwarranted and
unconsented demotion and transfer

Kinds and Forms of Employment

Article 294 (280)

Regular
Casual
Project
Seasonal

Other forms
Fixed Period
Probationary

Regular Employment
Employee has been engaged to perform
activities which are usually necessary or
desirable in the usual business or trade of
the employer;
One year of service has been rendered,
whether continuous or broken, with respect
to the activity in which he is employed;

Employee must be allowed to work after probationary


period in both instances.

Determining Regular
Status
Nature of Work Test Whether or not there is
reasonable connection between the particular
activity performed by the employee in relation
to the usual business or trade of the employer
Period of Service Test Employees length of
service is at least one year, whether
continuous or broken
Probationary Employee Test Whether or not
the employee is allowed to work after the
lapse of the probationary period.

Cases:Regular
Employment
ABS-CBN vs. Marlyn Nazareno (26 Sept.
2006)
Fabela vs. SMC, (Feb. 28, 2007)
De Leon vs NLRC, (176 SCRA 615)
Hacienda Fatima, (Jan. 28., 2003)

Casual Employment
Employee has been engaged to perform
activities which are NOT necessary or
desirable in the usual trade or business of
the employer
Once a casual employee has rendered at
least one year of service, his status
becomes REGULAR; no appointment or
declaration necessary

The purpose of this rule is to honor the


constitutional guarantee of security of tenure and
right to self-organization

Cases: Casual Employment


Conti vs. NLRC
Baguio Country Club vs. NLRC

Project Employment

Employee has been engaged for a SPECIFIC


project or undertaking
the completion or termination of the project has
been determined at the time of engagement of
the employee
REGULAR STATUS vested when
Continuous re-hiring of project employees even after
the cessation of a project for the same tasks or nature
of tasks (Tomas Lao Const. vs. NLRC, 276 SCRA)
Tasks performed by project employee are vital,
necessary and indispensable to the usual business or
trade of the employer

Project Employees

Exodus International Construction Corporation, et al. v.


Guillermo Biscocho, et al., G.R. No. 166109, Feb. 2011:
Two types of employees in the construction industry:
Project employees or those employed in connection with a
particular construction project or phase thereof and such
employment is coterminous with each project or phase of the
project to which they are assigned.
Non-project employees or those employed without reference to any
particular construction project or phase of a project; when one
project is completed, employees are automatically transferred to
the next project awarded to employer. There was no employment
agreement given employees which clearly spelled out the duration
of their employment and the specific work to be performed and
there is no proof that they were made aware of these terms and
conditions of their employment at the time of hiring.

Project Employees: Security of


Tenure
No dismissal before completion of project,
except for just or authorized cause;
Must comply with procedural requirements;
No need for notice of termination upon the
expiration of project period;

Project Employees: Security of


Tenure

Prior to dismissal, report must be made to


the nearest employment office of the
termination of services every time project is
completed.

Fixed Period Employment


Employment is for a pre-determined period
established at the time of engagement
(Read St. Theresas School of Novaliches vs.
NLRC, 289 SCRA 110)
Employees duties are usually necessary
and desirable to the usual business or trade
of the employer

Fixed Period Employment:


Validity
1.

2.

fixed period of employment was knowingly and


voluntarily agreed upon by the parties without
any force, duress, or improper pressure being
brought to bear upon the employee and absent
any other circumstances vitiating his consent; or
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 former or the latter. (Lynvil
Fishing Enterprises, Inc. vs. Andres G.
Ariola, et al., G.R. No. 181974, Feb. 2012)

Probationary Employment

Employer required to inform the probationary


employee of such reasonable standards at the time
of his engagement, not at any time later; else, the
latter shall be considered a regular employee. (Section 6,
Implementing Rules of Book VI, Rule VIII-A, Labor Code)
Purpose:
Employer observes the fitness, propriety and efficiency of a
probationer to ascertain whether he is qualified for permanent
employment,
Employee seeks to prove he has the qualifications to meet the
reasonable standards for permanent employment.

Length of time the probation depends on the parties


agreement, but not to exceed six (6) months under Article
295 (281) of the Labor Code.

Probationary Employment

Cases
Canadian Opportunities Unlimited, Inc. vs. Bart Q.
Dalangin, Jr., G.R. No. 172223, February 6, 2012.
Armando Ailing vs. Jose B. Feliciano, Manuel F. San
Mateo III, et al., G.R. No. 185829. April 25, 2012.

Seasonal Employment
Work or service is seasonal in nature and
the employment is for the seasons duration
Considered as regular if re-engaged after
one season
Seasonal employees not laid off during the
end of season, simply on leave w/o pay until
re-employment
Relationship is only suspended, not severed

Seasonal Employment
Work or service is seasonal in nature and
the employment is for the seasons duration
Considered as regular if re-engaged after
one season
Seasonal employees not laid off during the
end of season, simply on leave w/o pay until
re-employment
Relationship is only suspended, not severed

Management
Prerogative

Management Prerogatives
Our laws recognize and respect the exercise by management of
certain rights and prerogatives. For this reason, courts often
decline to interfere in legitimate business decisions of
employers. In fact, labor laws discourage interference in
employers judgment concerning the conduct of their business.
(Philippine Industrial Security Agency Corporation vs. Aguinaldo,
G. R. No. 149974, June 15, 2005; Mendoza vs. Rural Bank of
Lucban, G.R. No. 155421, July 7, 2004).
An employer can regulate, generally without restraint,
according to its own discretion and judgment, every aspect of
its business. (Deles, Jr. vs. NLRC, G. R. No. 121348, March 9,
2000).
This privilege is inherent in the right of employers to control and
manage their enterprise effectively. (Mendoza vs. Rural Bank of
Lucban, G.R. No. 155421, 07 July 2004).

Extent of management
prerogatives

regulate and control all aspects of employment in their


business organizations. Such aspects of employment
include hiring, work assignments, working methods,
time, place and manner of work, tools to be used,
processes to be followed, supervision of workers,
working regulations, transfer of employees, work
supervision, lay-off of workers and the discipline,
dismissal and recall of workers. (Philippine Airlines,
Inc. vs. NLRC, G. R. No. 115785, Aug. 4, 2000).
Management retains the prerogative to change the
working hours of its employees. (Sime Darby
Pilipinas, Inc. vs. NLRC, G.R. No. 119205, 15 April 1998,
289 SCRA 86).

Extent of management
prerogatives
A transfer means a movement (1) from one position to
another of equivalent rank, level or salary, without a break
in the service; or (2) from one office to another within the
same business establishment. (Sentinel Security Agency,
Inc. vs. NLRC, G. R. No. 122468, Sept. 3, 1998).
Prerogative of management to transfer an employee from
one office to another within the business establishment
upheld, provided

1. There is no demotion in rank or diminution of salary, benefits, and


other privileges, and;
2. Action is not motivated by discrimination, made in bad faith, or
effected as a form of punishment or demotion without sufficient
cause. (Mendoza vs. Rural Bank of Lucban, G. R. No. 155421, July
7, 2004; Benguet Electric Cooperative vs. Fianza, G. R. No.
158606, March 9, 2004).

Transfer, tests
1.

2.
3.

Must be exercised without grave abuse of


discretion
Basic elements of justice and fair play adhered to.
Employer must be able to show that the transfer
is not unreasonable, inconvenient or prejudicial to
the employee, otherwise, the employees transfer
is tantamount to constructive dismissal. (The
Philippine American Life and General
Insurance Co. vs. Gramaje, G. R. No. 156963,
Nov. 11, 2004; Globe Telecom, Inc. vs.
Florendo-Flores, G. R. No. 150092, Sept. 27,
2002).

Transfer

William Endeliseo Barroga vs. Data Center


College of the Philippines, et al., G.R. No.
174158, June 2011
Constructive dismissal is quitting because continued
employment is rendered impossible, unreasonable or
unlikely, or because of a demotion in rank or a
diminution of pay. It exists when there is a clear act of
discrimination, insensibility or disdain by an employer
which becomes unbearable for the employee to
continue his employment.
It is management prerogative for employers to transfer
employees on just and valid grounds such as genuine
business necessity, e.g. financial constraints

No vested right in position

An employee has a right to security of


tenure, but this does not give her such a
vested right in a position as would deprive
the employer of its prerogative to change
employee assignments or transfers where
the employees service will be most
beneficial to the employers client.

No vested right in position

Cases
OSS Security & Allied Services, Inc., vs.
NLRC, G. R. No. 112752, Feb. 9, 2000
Tan vs. NLRC, 299 SCRA 169, 180 [1998]
Chu vs. NLRC, G. R. No. 106107, June 2, 1994

Justified Refusal to
Transfer

Transfer directed by employer under


questionable circumstances
Transfer ordered during height of union activities
Used as a subterfuge to get rid of an undesirable
employee
Transfer is patently whimsical or vindictive

Justified Refusal to
Transfer

Cases
Union activities - Yuko Chemical Industries vs.
Ministry of Labor & Employment (GR No. 75656,
May 28, 1990)
No notice of transfer as condition for training Zafra vs. Court of Appeals (GR No. 139013,
September 17, 2002)
Whimsical or vindictive transfer - Damasco vs.
NLRC (GR No. 115755, December 4, 2000)

Valid Transfers

In general, transfers not characterized by


grave abuse of discretion or bad faith are all
valid. The worker cannot refuse for any of the
following grounds:
Additional expense and travel time (Genuino Ice
Company vs. Magpantay, GR No. 147790, June 27,
2006)
Parental obligations (Tinio vs. CA, GR No. 171764,
2007)
Anxiety
Home base (PT&T Corp. vs. Laplana, GR No.
76645, July 23, 1991)

Valid Transfers

Those directed
By contractual stipulation (Abbott Labs vs. NLRC,
GR No. 76959, Oct. 12, 1987)
Standard Operating Procedure
Company Policy
Order of the Government (Bisig Manggagawa ng.
Tryco vs. NLRC, GR No. 151309, Oct. 15, 2008)
Guidelines of Government Organs (BSP Circular
mandating rotation of bank employees

Valid Transfers
To avoid conflict of interest (Duncan
Association of Detailman PTGWO vs. Glaxo
Wellcome Phils., GR No.162994, September
17, 2004)
By reason of abolition of position (Beneco
vs. Fianza, 158606, March 9, 2004)

Promotion
Advancement from one position to another,
involving an increase in duties and
responsibilities authorized by law AND
increase in compensation and benefits.
Mere increase in salary should not be
determinative of promotion, as the increase
is merely incidental.

Promotion vs. Transfer


Promotion involves a scalar ascent in rank
or position
Transfer involves lateral movement to the
same rank and salary

Promotion vs. Transfer


A promotion can be refused, and it will not
result in punishment
A transfer directed in good faith and in the
exercise of management prerogative cannot
be refused without pain of sanction
A promotion that results from a transfer
requires the consent of the employee

Termination of
Employment

Constitutional vs. Statutory Due


Process

Agabon vs. NLRC (GR No. 158693, Nov. 27,


2004)
Constitutional due process protects the individual
against the government
Statutory due process protects the worker from
unjust termination of employment except for just
cause after notice and hearing

Requirements for Valid


Dismissal

Substantive Due Process: Valid Causes


Just Cause
Authorized by Law

Procedural Due Process:


Written notice of the charge/s
Opportunity to be heard
Hearing
Conference

Written notice of termination

Due Process

Skippers United Pacific, Inc. and Skippers Maritime


Services, Inc. Ltd. vs. Nathaniel Doza, et al. (GR
No. 175558, Feb. 2012)
Substantive due process - Legality of the act of dismissal.
Procedural due process - Legality of the manner of
dismissal. consists of twin requirements: notice and hearing.
Employer must furnish employee with two written notices
before termination of employment:
1st notice apprises the employee of the particular acts or
omissions for which his dismissal is sought;
2nd notice informs the employee of the employers decision to
dismiss him.
Before issuance of second notice, a hearing must be complied
with by giving the worker an opportunity to be heard.

Due Process

Substantive due process requires that


dismissal by the employer be made based
on a just or authorized cause under Articles
282 (296) to 284 (298) of the Labor Code.

Procedural Due Process - Notice


Notice issued prior to commission of offense does not
satisfy requirement (Janssen Pharmaceutica vs. Silayro,
GR 172528, Feb. 26, 2008)
Service of notice is a mandatory requirement
Notice must be in writing (no form necessary)

Must not only state the policy violated, but the corresponding
penalty of dismissal imposable thereon (Cruz vs. Coca-Cola, GR
No. 165586)
Must state that dismissal is sought
Charges stated in general terms invalid

Employee must be dismissed on same grounds stated


in first notice
Changing of ground for dismissal indicates lack of basis

Invalid Notices
Warning letters (Skippers United Pacific vs.
Maguad, GR No. 166363, August 15, 2006)
Affidavit narrating incident (Asian Terminals
vs. Marbella, GR No. 149074, August 10,
2006)
First notice pertains to a different incident
from the offense for which employee is
dismissed (Wah Yuen Restaurant vs. Jayona,
GR No. 159448, Dec. 16, 2005)

Instances when hearing not


necessary (Just Causes)
Employees admission
Termination due to abandonment

Burden of Proof & Quantum of


Evidence
Employer has burden of proof in showing
dismissal was not illegal (Limketkai Sons
Milling vs. Llamera, GR No. 152514, July 12,
2005)
Substantial proof, not clear and convincing
evidence.

Substantial Evidence

Clear and Convincing


Evidence

That amount of relevant


evidence which a reasonable
mind might accept as adequate
to justify a conclusion

A medium level of burden of


proof which is a more rigorous
standard to meet than the
preponderance of evidence
standard, but less than proof
beyond reasonable doubt.

Cases
Lynvil Fishing Enterprises v. Andres Ariola,
et al., GR No. 181974, February 1, 2012
Armando Ailing vs. Jose Feliciano, Manuel F.
San Mateo III, et al., GR No. 185829, April
25, 2012

Just Causes of
Termination of
Employment

Just Cause: Article


296(282)
1.
2.
3.
4.
5.

Serious Misconduct
Wilful Disobedience
Fraud or Breach of Trust
Gross Negligence
Analogous Causes

Serious Misconduct

Philippine Long Distance Telephone


Company v. Bolso, G.R. No. 159701, August
17, 2007
1. Improper or wrong conduct
2. Transgression of some established and definite
rule of action.
3. Dereliction of duty, wilful in character
4. Implies wrongful intent, not merely an error in
judgment

Misconduct as Basis for


Dismissal
Marival Trading vs. NLRC, GR No. 169600,
June 26, 2007
a) it must be serious;
b) it must relate to the performance of the
employees duties; and
c) it must show that the employee has
become unfit to continue working for the
employer.

Cases

Joeb M. Aliviado, et al., vs. Procter & Gamble


Philippines, Inc., GR No. 160506, June 6,
2011

Wilful Disobedience

One of the fundamental duties of an


employee is to obey all reasonable rules,
orders and instructions of the employer.

Disobedience, to be a just cause for


termination, must be willful or intentional,
willfulness being characterized by a
wrongful and perverse mental attitude
rendering the employees act inconsistent
with proper subordination.

Dismissal Proper for Willful


Disobedience
Willful and intentional disobedience
Where such rule, order or instruction
violated is:
1. reasonable and lawful
2. sufficiently known to the employee, and
3. connected with the duties which the
employee has been engaged to discharge.

Willfulness of
Disobedience

NATHANIEL N. DONGON,Petitioner,v.RAPID
MOVERS AND FORWARDERS CO., INC.,
AND/OR NICANOR E. JAO, JR.,G.R. No.
163431, August 28, 2013
Must be attended by a wrongful and perverse mental
attitude rendering the employees act inconsistent
with proper subordination
Constitutes harmful behavior against the business
interest or person of his employer
Impliedly, the erring employee obtains undue
advantage detrimental to the business interest of the
employer.

Insubordination =
dismissal?
Gold City Integrated Port Services vs. NLRC, GR
No. 86000, September 21, 1990
Not always punishable with dismissal
Reasonable proportionality between the act of
insubordination and penalty imposed therefore
If insubordination is not an effective threat to
his co-workers or the safety of the customers
dealing with his employer, or to the goodwill of
his employer, suspension is more
proportionate penalty

Cases

Kakampi and its members vs. Kingspoint


Express and Logistics and/or Mary Ann Co,
GR No. 194813, April 25, 2012

Fraud or Breach of Trust

Refers to any fault or culpability on the part


of the employee in the discharge of his duty
rendering him absolutely unworthy of trust
and confidence demanded by his position

Fraud or Breach of Trust

Mabeza vs. NLRC, G.R. No. 118506.April


18, 1997:
Loss of confidenceas a just cause for dismissal
was never intended to provide employers with a
blank check for terminating their employees. Such
a vague, all-encompassing pretext as loss of
confidence, if unqualifiedly given the seal of
approval by this Court, could readily reduce to
barren form the words of the constitutional
guarantee of security of tenure.

Fraud or Breach of Trust

Mabeza vs. NLRC, G.R. No. 118506.April 18,


1997:
Loss of confidence should ideally apply only to cases
involving employees occupying positions of trust and
confidence or to those situations where the employee is
routinely charged with the care and custody of the
employer's money or property.
managerial employees - those vested with the powers or
prerogatives to lay down management policies and/or to hire,
transfer, suspend, lay-off, recall, discharge, assign or discipline
employees or effectively recommend such managerial actions;
those who, in the normal and routine exercise of their
functions, regularly handle significant amounts of money or
property.

Requisites for Dismissal for


Fraud or Willful Breach
Loss of trust must be based on willful
breach
Person committing breach must hold a
position of responsibility, trust and
confidence.
Act complained of must be "work-related"
such as would show the employee
concerned to be unfit to continue working
for the employer.

Cases

James Ben L. Jerusalem vs. Keppel Monte


Bank, et al, GR No. 169564, April 6, 2011

Gross Negligence
Want or absence of or failure to exercise
slightest care or diligence, or entire absence
of care;
An absence of that diligence that an
ordinarily prudent man would use in his own
affairs.

Valid Basis for Dismissal, Gross


Negligence
Abel vs. Philex Mining Corp., GR No. 178976,
July 31, 2009
1. Want or absence of or failure to exercise
slight care or diligence;
2. Thoughtless disregard of consequences
without exerting effort to avoid them;
3. Negligence is not only gross but also
habitual.

Habitual neglect implies repeated failure to perform


one's duties for a period of time, depending upon
the circumstances.

Gross Negligence vs. Error in


Judgment

Dr. Danilo T. Ting And Mrs. Elena Ting


VS. Court Of Appeals, G.R. No. 146174,
July 12, 2006
While we are not unmindful that no material injury
need be shown to sustain a finding of gross
negligence,
Employee acted without bad faith
There was reasonable basis for the act committed
Employee is burdened by some condition that
would excuse error in judgment

Analogous Causes

Elements similar to those found in Labor


Code

Abandonment
Immoral Conduct
Sleeping on the Job
Tardiness
Unexplained Absences
Attitude Problem
Dishonesty

Cases
Nissan Motors Phils. vs. Victorino Angelo,
G.R. No.164181, September 2011
PGA Employee Labor Union and Sandy T.
Vallota vs. NLRC, PRUDENTIAL GUARANTEE
AND ASSURANCE INC., and/or Jocelyn
Retizos, G.R. No. 185335, June 13, 2012
Roberto Gonzalesvs. NLRC & Pepsi Cola
Products, Philippines, Inc., G.R. No.
131653, March 26, 2001

Preventive Suspension
Employer may place worker concerned under
preventive suspension if continued employment
poses serious and imminent threat to life or
property of employer and co-workers.
Period must be definite, but not longer than 30 days
Done during investigation
Employee not entitled to wages during preventive
suspension, but if period is extended, he is entitled
to wages for the time he is suspended beyond the
original 30-day period
See discussion on suspension as penalty

Authorized Causes
of Termination of
Employment

Authorized Cause: Article 297,


298(283-284)
1.
2.
3.
4.
5.

Retrenchment
Redundancy
Installation of Labor-Saving Devices
Closure of Business
Disease

Retrenchment
Reduction of personnel for the purpose of
cutting down operation costs in terms of
salaries and wages
Resorted to because of losses in operation
of business

Lack of work
Reduction in volume of business

Procedural Requirements for


Retrenchment
1.
2.

Necessary to prevent losses, which are established


Written notice to DOLE and employee at least one
month prior to termination
Employers lapse of belated furnishing of DOLE with the
one-month notice is only a procedural infirmity and does
not render the retrenchment illegal
BUT DOLE nonetheless still required to be given notice

3.
4.

5.

Payment of separation pay


Employer exercises prerogative for advancement
of its interest
Use of fair and reasonable criteria in ascertaining
who would be dismissed

Concept of Loss for Valid


Retrenchment
Losses should be substantial, not merely de
minimis;
Substantial losses sought to be averted
must be imminent;
To effectively prevent substantial losses,
retrenchment is reasonably necessary;
Alleged losses already suffered and
imminent losses sought to be forestalled
must be proved by sufficient and convincing
evidence.

Cases
Bonifacio Anino vs. NLRC, GR No. 123226,
May 21, 1996
Plastimer Industrial Corporation & Teo Kee
Bin vs. Natalia C. Gopo, GR No. 183390,
Feb. 16, 2011
International Management Services/Marilyn
Pascual vs. Roel P. Logarta, GR No. 163657,
Apr. 18, 2012

Redundancy
Exists where the service capability of the
workforce is greater than what is reasonably
required to meet the demands of the
business enterprise;
Position is redundant when it is rendered
superfluous by:

Overhiring of workers
Decrease in volume of business
Dropping of a particular product or service

Requisites of Valid
Redundancy
1.

2.

Good faith of the employer in abolishing


redundant position
Fair and reasonable criteria in ascertaining what
positions are to be declared redundant
Preferred status
Efficiency
Seniority

3.

Evidence to substantiate redundancy, e.g.:


Adoption of new staffing pattern
Feasibility studies on viability of new positions
Job description and approval of management of
restructuring

Installation of Labor-Saving
Devices
Related to redundancy
Installation of machinery to effect economy
and efficiency in its method of production
Employer not precluded from adopting a
new policy conducive to more economical
and effective management

Cases
DOLE Philippines vs. NLRC, Sep. 13, 2001
Nelson A. Culili vs. Eastern Telecoms, GR No.
165381, Feb. 9, 2011
Edgar Agustilo vs. Court of Appeals, San
Miguel Corporation, Francisco Manzon, Jr.,
GR No. 142875, Sep. 7, 2001

Business Closure
Closure of business or undertaking due to
business losses
Relocation of employers plant from one
location to another

Take note, however of runaway shops which are


considered as ULP

Determined by management. No business


can be required to continue operating at a
loss simply to maintain the workers in
employment

Cases
Alabang Country Club, Inc., et al vs. NLRC,
GR No. 157611, Aug. 9, 2005
Cheniver Deco Print Technics Corporation
vs. NLRC, et al, GR No. 122876, Feb. 17,
2000
Me Shurn Corporation vs. Me-Shurn Workers
Union-FSM, GR No. 156292, Jan. 11, 2005

Disease

Article 298: Employer shall not terminate


the service of employee suffering from any
disease unless there is a certification by a
competent public health authority that the
disease is incurable within a period of six
months even with proper medical treatment

Requisites for Termination,


Disease
Employee suffering from a disease
Employees continued employment is
prohibited by law or prejudicial to his health
or health of co-workers
Certification by competent public health
authority

Distinction of Just and


Authorized Causes of Dismissal
Just Cause

Authorized Cause

Implies that employee concerned


has committed or is guilty of
some violation against the
employer, as in serious
misconduct, fraud or neglect of
duties;

Does not imply delinquency or


culpability on the part of the
employee;

Dismissal process initiated by


employee

Dismissal process initiated by


employer

As a rule, separation pay is not


required

Law requires separation pay

Nominal damages to be paid if


employer overlooks procedural
due process is P30,000.00

Nominal damages to be paid if


employer overlooks procedural
due process is P50,000.00

Termination Disputes

Possible Outcomes
DISMISSAL

VALID IF:

Dismissal is for Just Cause (Art 296) or Authorized


Cause (Art 297-298)
Procedural requirements complied

Substantial & Procedural Due Process


present

Possible Outcomes
DISMISSAL

INVALID IF:

Dismissal is NOT for Just Cause (Art 296) or


Authorized Cause (Art 297-298)
Procedural requirements complied

Substantial Due Process absent

Possible Outcomes
DISMISSAL

INVALID IF:

Dismissal is NOT for Just Cause (Art 296) or


Authorized Cause (Art 297-298)
Procedural requirements NOT complied

Both Substantial & Procedural Due Process


absent

Possible Outcomes
DISMISSAL

VALID:

Dismissal is for Just Cause (Art 296) or Authorized


Cause (Art 297-298)
Procedural requirements not complied

Substantial Due Process present but


Procedural Due Process is wanting

Employer

liable to pay indemnity


in the form of nominal damages

Related Supreme Court


Decisions
Pre WENPHIL Case: If just cause existed but
procedural due process not followed, dismissed
employee entitled to reinstatement & backwages
Wenphil Doctrine: If the dismissal was for a just
or authorized cause but done without due
process, termination is valid but employer
sanctioned with payment of indemnity
However, Serrano vs. NLRC termed the
termination ineffectual, not illegal, and penalty
imposed on employer is full backwages plus
nominal and moral damages

Prevailing Rule: Agabon vs.


NLRC
Abandoned Serrano ruling and reverted to
Wenphil Doctrine. Backwages and moral
damages deleted, nominal damages limited
to those in Agabon and Jaka cases
AGABON RULING: Dismissal will be held
valid and legal but employer should be
sanctioned for failure to afford due process
to employee

Nominal Damages
If

dismissal is for Just Cause

P30,000.00 (Agabon Case)


If

dismissal is for Authorized Cause

P50,000.00 (Jaka Food Processing Corp. vs.


Pacot)

Possible Outcomes
DISMISSAL

NOT EFFECTIVE:

If dismissal is for Cause proven to be nonexistent

Ex. See the following cases:


Magtoto vs. NLRC, GR No. 6370, Nov. 18, 1985
Standard Electric Manufacturing Corp. vs.
Standard Electric Employees Union, GR No.
166111, August 25, 2005
Asian Terminals Inc. vs. NLRC, GR No 158458,
Dec. 19, 2007

Suspension as Penalty

Imposed when dismissal is too harsh a


penalty due to certain mitigating factors
such as absence of malice, or employee is a
first offender

Relief for Illegal Dismissal


Reinstatement without loss of seniority
rights and other privileges
Full backwages and allowances
Other benefits or their equivalent in cash
Damages
Attorneys fees
Legal interest on separation pay