Professional Documents
Culture Documents
PART ONE
(LABOR STANDARDS)
Introductory Concepts
1. Definition
Labor Law - It is the law that governs the rights and duties of employers and
employees, first with respect to the terms and conditions of employment, and
second, with respect to the labor disputes arising from collective bargaining
respecting such terms and conditions.
It is the Humanization of Laws and the Equalization of social and economic forces by
the State so that Justice is in its rational and objectively secular conception may at
least be approximated.
(Sec. 10, Art. II, 1987 Constitution)
- ART. 4 Labor Code. Construction in favor of labor. - All doubts in the implementation
and interpretation of the provisions of this Code, including its implementing rules and
regulations, shall be resolved in favor of labor.
- ART. 1700,NCC. 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 Lawson labor unions, collective bargaining, strikes and lockouts, closed
shop, wages, working conditions, hours of labor, and similar subjects.
- ART. 1701, NCC. Neither capital nor labor shall act oppressively against the
other, or impair the interest or convenience of the public.
- ART. 1702, NCC. In case of doubt, all labor legislations and all labor contracts
shall be construed in favor of the safety and decent living of the laborer.
NOTE:
Under Art. 1700 of the Civil Code, there are 4 Parties to an employment contract;
1. Employer
2. Employee
3. State
4. Public
Indeed, the rule is that all doubts in the implementation and the interpretation of the
Labor Code shall be resolved in favor of labor, in order to give effect to the policy of the
State to afford protection to labor, promote full employment, ensure equal work
opportunities regardless of sex, race or creed, and regulate the relations between
workers and employers, and to assure the rights of workers to self-organization,
collective bargaining, security of tenure, and just and humane conditions of work.
It is a well-settled doctrine, that if doubts exist between the evidence presented by the
employer and the employee, the scales of justice must be tilted in favor of the latter. It
is a time-honored rule that in controversies between a laborer and his master, doubts
reasonably arising from the evidence, or in the interpretation of agreements and
writing should be resolved in the formers favor. The policy is to extend the doctrine to
a greater number of employees who can avail of the benefits under the law, which is in
consonance with the avowed policy of the State to give maximum aid and protection of
labor.
There is no need to determine whether or not the fetus had civil personality since it is
not her civil rights which are in question but rather that of her father. It is sufficient
that she is recognized as having been born and having died, which is affirmed by Art.
37, for her father to receive the benefits sought.
When conflicting interests of labor and capital are to be weighed on the scales of social
justice, the heavier influence of the latter should be counter-balanced by sympathy and
compassion the law must accord the underprivileged worker.
In our view, it is more consistent with human experience that Peaflor indeed learned
of the appointment of Buenaobra only on March 13, 2000 and reacted to this
development through his resignation letter after realizing that he would only face
hostility and frustration in his working environment. Three very basic labor law
principles support this conclusion and militate against the companys case.
The first is the settled rule that in employee termination disputes, the employer bears
the burden of proving that the employees dismissal was for just and valid cause. That
Peaflor did indeed file a letter of resignation does not help the companys case as,
other than the fact of resignation, the company must still prove that the employee
voluntarily resigned. There can be no valid resignation where the act was made under
compulsion or under circumstances approximating compulsion, such as when an
employees act of handing in his resignation was a reaction to circumstances leaving
him no alternative but to resign. In sum, the evidence does not support the existence
of voluntariness in Peaflors resignation
Another basic principle is that expressed in Article 4 of the Labor Code that all doubts
in the interpretation and implementation of the Labor Code should be interpreted in
favor of the workingman.
As a final note, let it be emphasized that the constitutional policy to provide full
protection to labor is not meant to be a sword to oppress employers. The commitment
of this Court to the cause of labor does not prevent us from sustaining the employer
when it is in the right.
The law, in protecting the rights of the employee, authorizes neither oppression nor
self-destruction of the employer. Contrary to petitioners claim, remand of the case to
the NLRC is proper since the company has yet to present its evidence during the formal
hearing. It is true that both parties have been provided the opportunity to prove their
cases through the pleadings submitted before the NLRC; however, only petitioners
were given the chance to present its side in the formal hearing. The factual issues
raised in the consolidated cases could still be affected by the additional evidence to be
presented by the company. Equity demands that the company must be equally
allowed to adduce its evidence, if the NLRC is to come up with a rational and impartial
decision.
Management prerogatives are not expressly provided for under the Labor Code being
inherent in nature. But they are guaranteed under Sec. 1, Art 3, of the Constitution
which states:
No person shall be deprived of life, liberty, or property without due process of law,
nor shall any person be denied the equal protection of the laws.
Basically, management has the right to control his business (a form of property) in
any way he sees fit to ensure better performance.
- Placido Urbanes vs CA
- Phil. Am Life & Gen Insurance Co. vs Gramaje (GR# 156963 - 11/11/04)
The management prerogative was unfair and unreasonable. The employers right to
conduct the affairs of his business, according to its own discretion and judgment, is
well-recognized. An employer has a free reign and enjoys wide latitude of discretion
to regulate all aspects of employment, including the prerogative to instill discipline
in its employees and to impose penalties, including dismissal, upon erring
employees. This is a management prerogative, where the free will of management
to conduct its own affairs to achieve its purpose takes form. The only criterion to
guide the exercise of its management prerogative is that the policies, rules and
regulations on work-related activities of the employees must always be fair and
reasonable and the corresponding penalties, when prescribed, commensurate to
the offense involved and to the degree of the infraction. The dismissal meted out
on the respondents for dereliction of duty for one school day and denouncing
school authority, appears to be too harsh a penalty. Even when an employee is
found to have transgressed the employers rules, in the actual imposition of
penalties upon the erring employee, due consideration must still be given to his
length of service and the number of violations committed during his employment.
Where a penalty less punitive would suffice, whatever missteps may have been
committed by the employee ought not to be visited with a consequence so severe
such as dismissal from employment.
Ababon, et. al were legally dismissed. Work is a necessity that has economic
significance deserving legal protection. The social justice and protection to labor
provisions in the Constitution dictate so. On the other hand, employers are also
accorded rights and privileges to assure their self-determination and independence,
and reasonable return of capital. This mass of privileges comprises the so-called
management prerogatives. Although they may be broad and unlimited in scope,
the State has the right to determine whether an employer's privilege is exercised in
a manner that complies with the legal requirements and does not offend the
protected rights of labor. One of the rights accorded an employer is the right to
close an establishment or undertaking. The right to close the operation of an
establishment or undertaking is one of the authorized causes in terminating
employment of workers, the only limitation being that the closure must not be for
the purpose of circumventing the provisions on termination of employment
embodied in the Labor Code. ITCs closure or cessation of business was done in
good faith and for valid reasons. The records reveal that the decision to
permanently close business operations was arrived at after a suspension of
operation for several months precipitated by lack of raw materials used for milling
operations, the expiration of the anti-pollution permit in April 1990, and the
termination of the lease contract with IPGC in August 1990 over the plywood plant.
Although the closure was done in good faith and for valid reasons, ITC did not
comply with the notice requirement. While an employer is under no obligation to
conduct hearings before effecting termination of employment due to authorized
cause, however, the law requires that it must notify the DOLE and its employees at
least one month before the intended date of closure. The unfairness of declaring
illegal or ineffectual dismissals for valid or authorized causes but not complying
with statutory due process may have far-reaching consequences. Where the
dismissal is based on an authorized cause under Article 283 of the Labor Code but
the employer failed to comply with the notice requirement, the sanction should be
stiff as the dismissal process was initiated by the employers exercise of his
management prerogative, as opposed to a dismissal based on a just cause under
Article 282 with the same procedural infirmity where the sanction to be imposed
upon the employer should be tempered as the dismissal process was, in effect,
initiated by an act imputable to the employee.
Under Article 282 of the Labor Code, willful disobedience of a lawful order of the
employer is a valid cause for dismissal. Management has the right to formulate
reasonable rules to regulate the conduct of its employees for the protection of its
interests. These reasonable house rules are considered by the Court as lawful
orders and therefore violations thereof will justify dismissal under Article 282(a) of
the Labor Code. Company Rule 8 is a valid exercise of management prerogative
and thus a lawful order. Respondents were expected to abide by them and their
transgression, despite clear warnings, provided just cause for the termination of
their employment.
MANAGEMENT LIMITATIONS
PREROGATIVE
Power to Hire No Child below 15 shall be employed
Obligation to prevent/deter acts of sexual
harassment
No stipulation against marriage
Nightwork prohibition for women
Equal opportunity for disabled persons
Yellow Dog Contract
Prohibition against Human Trafficking
Employment of Handicapped Workers
Power to Demote
Power to Transfer Transfer must be reasonable or with a sound
purpose
There must be consideration for the convenience
and welfare of the employee
It must not be prejudicial to the employee
It must not involve a Demotion in Rank or Status,
or a diminution of the employees salary
Power to Discipline
Power to Manage
Power to Fire
1. Hire
R.A. 7610
ARTICLE I
Title, Policy, Principles and Definitions of Terms
It shall be the policy of the State to protect and rehabilitate children gravely
threatened or endangered by circumstances which affect or will affect their
survival and normal development and over which they have no control.
(a) "Children" refers to person below eighteen (18) years of age or those over
but are unable to fully take care of themselves or protect themselves from
abuse, neglect, cruelty, exploitation or discrimination because of a physical or
mental disability or condition;
(b) "Child abuse" refers to the maltreatment, whether habitual or not, of the
child which includes any of the following:
(1) Psychological and physical abuse, neglect, cruelty, sexual abuse and
emotional maltreatment;
(2) Any act by deeds or words which debases, degrades or demeans the
intrinsic worth and dignity of a child as a human being;
(3) Unreasonable deprivation of his basic needs for survival, such as food and
shelter; or
(2) Working under conditions hazardous to life, safety and normal which
unduly interfere with their normal development;
(3) Living in or fending for themselves in the streets of urban or rural areas
without the care of parents or a guardian or basic services needed for a good
quality of life;
ARTICLE II
Program on Child Abuse, Exploitation and Discrimination
ARTICLE III
Child Prostitution and Other Sexual Abuse
(b) Those who commit the act of sexual intercourse of lascivious conduct with
a child exploited in prostitution or subject to other sexual abuse; Provided,
That when the victims is under twelve (12) years of age, the perpetrators shall
be prosecuted under Article 335, paragraph 3, for rape and Article 336 of Act
No. 3815, as amended, the Revised Penal Code, for rape or lascivious
conduct, as the case may be: Provided, That the penalty for lascivious conduct
when the victim is under twelve (12) years of age shall be reclusion temporal
in its medium period; and
ARTICLE IV
Child Trafficking
Section 7. Child Trafficking. Any person who shall engage in trading and
dealing with children including, but not limited to, the act of buying and
selling of a child for money, or for any other consideration, or barter, shall
suffer the penalty of reclusion temporal to reclusion perpetua. The penalty
shall be imposed in its maximum period when the victim is under twelve (12)
years of age.
(a) When a child travels alone to a foreign country without valid reason
therefor and without clearance issued by the Department of Social Welfare
and Development or written permit or justification from the child's parents or
legal guardian;
(c) When a person, agency, establishment or child-caring institution recruits
women or couples to bear children for the purpose of child trafficking; or
(d) When a doctor, hospital or clinic official or employee, nurse, midwife, local
civil registrar or any other person simulates birth for the purpose of child
trafficking; or
(e) When a person engages in the act of finding children among low-income
families, hospitals, clinics, nurseries, day-care centers, or other child-during
institutions who can be offered for the purpose of child trafficking.
A penalty lower two (2) degrees than that prescribed for the consummated
felony under Section 7 hereof shall be imposed upon the principals of the
attempt to commit child trafficking under this Act.
ARTICLE V
Obscene Publications and Indecent Shows
Any ascendant, guardian, or person entrusted in any capacity with the care of
a child who shall cause and/or allow such child to be employed or to
participate in an obscene play, scene, act, movie or show or in any other acts
covered by this section shall suffer the penalty of prision mayor in its medium
period.
ARTICLE VI
Other Acts of Abuse
(a) Any person who shall commit any other acts of child abuse, cruelty or
exploitation or to be responsible for other conditions prejudicial to the child's
development including those covered by Article 59 of Presidential Decree No.
603, as amended, but not covered by the Revised Penal Code, as amended,
shall suffer the penalty of prision mayor in its minimum period.
(b) Any person who shall keep or have in his company a minor, twelve (12)
years or under or who in ten (10) years or more his junior in any public or
private place, hotel, motel, beer joint, discotheque, cabaret, pension house,
sauna or massage parlor, beach and/or other tourist resort or similar places
shall suffer the penalty of prision mayor in its maximum period and a fine of
not less than Fifty thousand pesos (P50,000): Provided, That this provision
shall not apply to any person who is related within the fourth degree of
consanguinity or affinity or any bond recognized by law, local custom and
tradition or acts in the performance of a social, moral or legal duty.
(c) Any person who shall induce, deliver or offer a minor to any one prohibited
by this Act to keep or have in his company a minor as provided in the
preceding paragraph shall suffer the penalty of prision mayor in its medium
period and a fine of not less than Forty thousand pesos (P40,000); Provided,
however, That should the perpetrator be an ascendant, stepparent or
guardian of the minor, the penalty to be imposed shall be prision mayor in its
maximum period, a fine of not less than Fifty thousand pesos (P50,000), and
the loss of parental authority over the minor.
(d) Any person, owner, manager or one entrusted with the operation of any
public or private place of accommodation, whether for occupancy, food, drink
or otherwise, including residential places, who allows any person to take along
with him to such place or places any minor herein described shall be imposed
a penalty of prision mayor in its medium period and a fine of not less than
Fifty thousand pesos (P50,000), and the loss of the license to operate such a
place or establishment.
(e) Any person who shall use, coerce, force or intimidate a street child or any
other child to;
(3) Conduct any illegal activities, shall suffer the penalty of prision
correccional in its medium period to reclusion perpetua.
For purposes of this Act, the penalty for the commission of acts punishable
under Articles 248, 249, 262, paragraph 2, and 263, paragraph 1 of Act No.
3815, as amended, the Revised Penal Code, for the crimes of murder,
homicide, other intentional mutilation, and serious physical injuries,
respectively, shall be reclusion perpetua when the victim is under twelve (12)
years of age. The penalty for the commission of acts punishable under Article
337, 339, 340 and 341 of Act No. 3815, as amended, the Revised Penal Code,
for the crimes of qualified seduction, acts of lasciviousness with the consent of
the offended party, corruption of minors, and white slave trade, respectively,
shall be one (1) degree higher than that imposed by law when the victim is
under twelve (12) years age.
The victim of the acts committed under this section shall be entrusted to the
care of the Department of Social Welfare and Development.
ARTICLE VII
Sanctions for Establishments or Enterprises
ARTICLE VIII
Working Children
Section 12. Employment of Children. Children below fifteen (15) years of
age may be employed except:
(1) When a child works directly under the sole responsibility of his parents or
legal guardian and where only members of the employer's family are
employed: Provided, however, That his employment neither endangers his
life, safety and health and morals, nor impairs his normal development:
Provided, further, That the parent or legal guardian shall provide the said
minor child with the prescribed primary and/or secondary education; or
(a) The employer shall ensure the protection, health, safety and morals of the
child;
(b) the employer shall institute measures to prevent the child's exploitation or
discrimination taking into account the system and level of remuneration, and
the duration and arrangement of working time; and;
(c) The employer shall formulate and implement, subject to the approval and
supervision of competent authorities, a continuing program for training and
skill acquisition of the child.
In the above exceptional cases where any such child may be employed, the
employer shall first secure, before engaging such child, a work permit from
the Department of Labor and Employment which shall ensure observance of
the above requirement.
Section 15. Duty of Employer. Every employer shall comply with the
duties provided for in Articles 108 and 109 of Presidential Decree No. 603.
Section 16. Penalties. Any person who shall violate any provision of this
Article shall suffer the penalty of a fine of not less than One thousand pesos
(P1,000) but not more than Ten thousand pesos (P10,000) or imprisonment of
not less than three (3) months but not more than three (3) years, or both at
the discretion of the court; Provided, That, in case of repeated violations of
the provisions of this Article, the offender's license to operate shall be
revoked.
ARTICLE IX
Children of Indigenous Cultural Communities
Section 19. Health and Nutrition. The delivery of basic social services in
health and nutrition to children of indigenous cultural communities shall be
given priority by all government agencies concerned. Hospitals and other
health institution shall ensure that children of indigenous cultural communities
are given equal attention. In the provision of health and nutrition services to
children of indigenous cultural communities, indigenous health practices shall
be respected and recognized.
ARTICLE X
Children in Situations of Armed Conflict
(a) Children shall not be the object of attack and shall be entitled to special
respect. They shall be protected from any form of threat, assault, torture or
other cruel, inhumane or degrading treatment;
(b) Children shall not be recruited to become members of the Armed Forces of
the Philippines of its civilian units or other armed groups, nor be allowed to
take part in the fighting, or used as guides, couriers, or spies;
(c) Delivery of basic social services such as education, primary health and
emergency relief services shall be kept unhampered;
(d) The safety and protection of those who provide services including those
involved in fact-finding missions from both government and non-government
institutions shall be ensured. They shall not be subjected to undue
harassment in the performance of their work;
(e) Public infrastructure such as schools, hospitals and rural health units shall
not be utilized for military purposes such as command posts, barracks,
detachments, and supply depots; and
(f) All appropriate steps shall be taken to facilitate the reunion of families
temporarily separated due to armed conflict.
Section 23. Evacuation of Children During Armed Conflict. Children
shall be given priority during evacuation as a result of armed conflict. Existing
community organizations shall be tapped to look after the safety and well-
being of children during evacuation operations. Measures shall be taken to
ensure that children evacuated are accompanied by persons responsible for
their safety and well-being.
(a) Separate detention from adults except where families are accommodated
as family units;
(c) Immediate notice of such arrest to the parents or guardians of the child;
and
(d) Release of the child on recognizance within twenty-four (24) hours to the
custody of the Department of Social Welfare and Development or any
responsible member of the community as determined by the court.
If after hearing the evidence in the proper proceedings the court should find
that the aforesaid child committed the acts charged against him, the court
shall determine the imposable penalty, including any civil liability chargeable
against him. However, instead of pronouncing judgment of conviction, the
court shall suspend all further proceedings and shall commit such child to the
custody or care of the Department of Social Welfare and Development or to
any training institution operated by the Government, or duly-licensed
agencies or any other responsible person, until he has had reached eighteen
(18) years of age or, for a shorter period as the court may deem proper, after
considering the reports and recommendations of the Department of Social
Welfare and Development or the agency or responsible individual under
whose care he has been committed.
The aforesaid child whose sentence is suspended can appeal from the order of
the court in the same manner as appeals in criminal cases.
ARTICLE XI
Remedial Procedures
(g) At least three (3) concerned responsible citizens where the violation
occurred.
Section 28. Protective Custody of the Child. The offended party shall
be immediately placed under the protective custody of the Department of
Social Welfare and Development pursuant to Executive Order No. 56, series of
1986. In the regular performance of this function, the officer of the
Department of Social Welfare and Development shall be free from any
administrative, civil or criminal liability. Custody proceedings shall be in
accordance with the provisions of Presidential Decree No. 603.
It shall be unlawful for any editor, publisher, and reporter or columnist in case
of printed materials, announcer or producer in case of television and radio
broadcasting, producer and director of the film in case of the movie industry,
to cause undue and sensationalized publicity of any case of violation of this
Act which results in the moral degradation and suffering of the offended party.
Any provision of existing law to the contrary notwithstanding and with the
exception of habeas corpus, election cases, and cases involving detention
prisoners and persons covered by Republic Act No. 4908, all courts shall give
preference to the hearing or disposition of cases involving violations of this
Act.
ARTICLE XII
Common Penal Provisions
(a) The penalty provided under this Act shall be imposed in its maximum
period if the offender has been previously convicted under this Act;
(c) The penalty provided herein shall be imposed in its maximum period when
the perpetrator is an ascendant, parent guardian, stepparent or collateral
relative within the second degree of consanguinity or affinity, or a manager or
owner of an establishment which has no license to operate or its license has
expired or has been revoked;
(d) When the offender is a foreigner, he shall be deported immediately after
service of sentence and forever barred from entry to the country;
(e) The penalty provided for in this Act shall be imposed in its maximum
period if the offender is a public officer or employee: Provided, however, That
if the penalty imposed is reclusion perpetua or reclusion temporal, then the
penalty of perpetual or temporary absolute disqualification shall also be
imposed: Provided, finally, That if the penalty imposed is prision correccional
or arresto mayor, the penalty of suspension shall also be imposed; and
ARTICLE XIII
Final Provisions
Such rules and regulations shall take effect upon their publication in two (2)
national newspapers of general circulation.
Section 35. Repealing Clause. All laws, decrees, or rules inconsistent with
the provisions of this Acts are hereby repealed or modified accordingly.
Section 36. Effectivity Clause. This Act shall take effect upon completion
of its publication in at least two (2) national newspapers of general circulation.
R.A. 9231
"It shall be the policy of the State to protect and rehabilitate children gravely
threatened or endangered by circumstances which affect or will affect their
survival and normal development and over which they have no control.
"1) When a child works directly under the sole responsibility of his/her parents
or legal guardian and where only members of his/her family are
employed: Provided, however, That his/her employment neither endangers
his/her life, safety, health, and morals, nor impairs his/her normal
development:Provided, further, That the parent or legal guardian shall provide
the said child with the prescribed primary and/or secondary education; or
"(a) The employer shall ensure the protection, health, safety, morals and
normal development of the child;
"(b) The employer shall institute measures to prevent the child's exploitation
or discrimination taking into account the system and level of remuneration,
and the duration and arrangement of working time; and
"(c) The employer shall formulate and implement, subject to the approval and
supervision of competent authorities, a continuing program for training and
skills acquisition of the child.
"In the above-exceptional cases where any such child may be employed, the
employer shall first secure, before engaging such child, a work permit from
the Department of Labor and Employment which shall ensure observance of
the above requirements.
"For purposes of this Article, the term "child" shall apply to all persons under
eighteen (18) years of age."
"Sec. 2-A. Hours of Work of a Working Child. - Under the exceptions provided
in Section 12 of this Act, as amended:
"(1) A child below fifteen (15) years of age may be allowed to work for not
more than twenty (20) hours a week: Provided, That the work shall not be
more than four (4) hours at any given day;
"(2) A child fifteen (15) years of age but below eighteen (18) shall not be
allowed to work for more than eight (8) hours a day, and in no case beyond
forty (40) hours a week;
"(3) No child below fifteen (15) years of age shall be allowed to work between
eight o'clock in the evening and six o'clock in the morning of the following day
and no child fifteen (15) years of age but below eighteen (18) shall be allowed
to work between ten o'clock in the evening and six o'clock in the morning of
the following day."
"The income of the working child and/or the property acquired through the
work of the child shall be administered by both parents. In the absence or
incapacity of either of the parents, the other parent shall administer the same.
In case both parents are absent or incapacitated, the order of preference on
parental authority as provided for under the Family Code shall apply.
"Sec. 12-C. Trust Fund to Preserve Part of the Working Child's Income. - The
parent or legal guardian of a working child below eighteen (18) years of age
shall set up a trust fund for at least thirty percent (30%) of the earnings of the
child whose wages and salaries from work and other income amount to at
least two hundred thousand pesos (P200,000.00) annually, for which he/she
shall render a semi-annual accounting of the fund to the Department of Labor
and Employment, in compliance with the provisions of this Act. The child shall
have full control over the trust fund upon reaching the age of majority.
"Sec. 12-D. Prohibition Against Worst Forms of Child Labor. - No child shall be
engaged in the worst forms of child labor. The phrase "worst forms of child
labor" shall refer to any of the following:
"(1) All forms of slavery, as defined under the "Anti-trafficking in Persons Act
of 2003", or practices similar to slavery such as sale and trafficking of
children, debt bondage and serfdom and forced or compulsory labor, including
recruitment of children for use in armed conflict; or
"(2) The use, procuring, offering or exposing of a child for prostitution, for the
production of pornography or for pornographic performances; or
"(3) The use, procuring or offering of a child for illegal or illicit activities,
including the production and trafficking of dangerous drugs and volatile
substances prohibited under existing laws; or
"(4) Work which, by its nature or the circumstances in which it is carried out,
is hazardous or likely to be harmful to the health, safety or morals of children,
such that it:
"a) Debases, degrades or demeans the intrinsic worth and dignity of a child as
a human being; or
"e) Exposes the child to physical danger such as, but not limited to the
dangerous feats of balancing, physical strength or contortion, or which
requires the manual transport of heavy loads; or
"h) Exposes the child to biological agents such as bacteria, fungi, viruses,
protozoans, nematodes and other parasites; or
"Sec. 13. Access to Education and Training for Working Children - "a) No child
shall be deprived of formal or non-formal education. In all cases of
employment allowed in this Act, the employer shall provide a working child
with access to at least primary and secondary education.
"b) To ensure and guarantee the access of the working child to education and
training, the Department of Education (DEPED) shall: (1) formulate,
promulgate, and implement relevant and effective course designs and
educational programs; (2) conduct the necessary training for the
implementation of the appropriate curriculum for the purpose; (3) ensure the
availability of the needed educational facilities and materials; and (4) conduct
continuing research and development program for the necessary and relevant
alternative education of the working child.
"c) The DEPED shall promulgate a course design under its non-formal
education program aimed at promoting the intellectual, moral and vocational
efficiency of working children who have not undergone or finished elementary
or secondary education. Such course design shall integrate the learning
process deemed most effective under given circumstances."
"a) Any employer who violates Sections 12, 12-A, and Section 14 of this act,
as amended, shall be penalized by imprisonment of six (6) months and one (1)
day to six (6) years or a fine of not less than Fifty thousand pesos
(P50,000.00) but not more than Three hundred thousand pesos (P300,000.00)
or both at the discretion of the court.
"b) Any person who violates the provision of Section 12-D of this act or the
employer of the subcontractor who employs, or the one who facilitates the
employment of a child in hazardous work, shall suffer the penalty of a fine of
not less than One hundred thousand pesos (P100,000.00) but not more than
One million pesos (P1,000,000.00), or imprisonment of not less than twelve
(12) years and one (1) day to twenty (20) years, or both such fine and
imprisonment at the discretion of the court.
"c) Any person who violates Sections 12-D(1) and 12-D(2) shall be prosecuted
and penalized in accordance with the penalty provided for by R. A. 9208
otherwise known as the "Anti-trafficking in Persons Act of
2003":Provided, That Such penalty shall be imposed in its maximum period.
"d) Any person who violates Section 12-D (3) shall be prosecuted and
penalized in accordance with R.A. 9165, otherwise known as the
"Comprehensive Dangerous Drugs Act of 2002"; Provided, That such penalty
shall be imposed in its maximum period.
"(1) The violation of any provision of this Act has resulted in the death,
insanity or serious physical injury of a child employed in such establishment;
or
"h) In case of such closure, the employer shall be required to pay the
employee(s) the separation pay and other monetary benefits provided for by
law."
Section 7. The same Act is hereby further amended by adding a new section
to be denominated as Section 16-A, to read as follows:
"Sec. 16-A. Trust Fund from Fines and Penalties - The fine imposed by the
court shall be treated as a Trust Fund, administered by the Department of
Labor and Employment and disbursed exclusively for the needs, including the
costs of rehabilitation and reintegration into the mainstream of society of the
working children who are victims of the violations of this Act, and for the
programs and projects that will prevent acts of child labor."
"Sec. 27. Who May File a Complaint - Complaints on cases of unlawful acts
committed against children as enumerated herein may be filed by the
following:
"(a) Offended party;
"(f) Barangay chairman of the place where the violation occurred, where the
child is residing or employed; or
"(g) At least three (3) concerned, responsible citizens where the violation
occurred."
Section 9. The same Act is hereby further amended by adding new sections
to Section 16 to be denominated as Sections 16-A, 16-B and 16-C to read as
follows:
"Sec. 16-A. Jurisdiction - The family courts shall have original jurisdiction over
all cases involving offenses punishable under this Act: Provided, That in cities
or provinces where there are no family courts yet, the regional trial courts and
the municipal trial courts shall have concurrent jurisdiction depending on the
penalties prescribed for the offense charged.
"The preliminary investigation of cases filed under this Act shall be terminated
within a period of thirty (30) days from the date of filing.
"If the preliminary investigation establishes a prima facie case, then the
corresponding information shall be filed in court within forty eight (48) hours
from the termination of the investigation.
"Trial of cases under this Act shall be terminated by the court not later than
ninety (90) days from the date of filing of information. Decision on said cases
shall be rendered within a period of fifteen (15) days from the date of
submission of the case.
"Sec. 15. Exemptions from Filing Fees. - When the victim of child labor
institutes a separate civil action for the recovery of civil damages, he/she shall
be exempt from payment of filing fees.
Such rules and regulations shall take effect upon their publication in two (2)
national newspapers of general circulation.
Section 12. Repealing Clause. - All laws, decrees, or rules inconsistent with
the provisions of this Act are hereby repealed or modified accordingly.
Section 13. Effectivity. - This Act shall take effect fifteen (15) days from the
date of its complete publication in the Official Gazette or in at least two (2)
national newspapers of general circulation.
SECTION 1. Title. - This Act shall be known as the "Anti-Sexual Harassment Act
of 1995."
SECTION 2. Declaration of Policy. - The State shall value the dignity of every
individual, enhance the development of its human resources, guarantee full
respect for human rights, and uphold the dignity of workers, employees,
applicants for employment, students or those undergoing training, instruction
or education. Towards this end, all forms of sexual harassment in the
employment, education or training environment are hereby declared
unlawful.
Any person who directs or induces another to commit any act of sexual
harassment as herein defined, or who cooperates in the commission thereof
by another without which it would not have been committed, shall also be
held liable under this Act.
The said rules and regulations issued pursuant to this subsection (a) shall
include, among others, guidelines on proper decorum in the workplace and
educational or training institutions.
SECTION 7. Penalties. - Any person who violates the provisions of this Act
shall, upon conviction, be penalized by imprisonment of not less than one (1)
month nor more than six (6) months, or a fine of not less than Ten thousand
pesos (P10,000) nor more than Twenty thousand pesos (P20,000), or both
such fine and imprisonment at the discretion of the court.
Any action arising from the violation of the provisions of this Act shall
prescribe in three (3) years.
SECTION 10. Effectivity Clause.- This Act shall take effect fifteen (15) days
after its complete publication in at least two (2) national newspapers of
general circulation.
R.A. 7277
TITLE I
GENERAL PROVISIONS
CHAPTER I
BASIC PRINCIPLE
Section 1. Title. This Act shall be known and cited as the "Magna Carta for
Disabled Persons."
Sec. 2. Declaration of Policy The grant of the rights and privileges for
disabled persons shall be guided by the following principles:
(a) Disabled persons are part of Philippine society, thus the State shall give
full support to the improvement of the total well-being of disabled persons
and their integration into the mainstream of society. Toward this end, the
State shall adopt policies ensuring the rehabilitation, self-development and
self-reliance of disabled persons. It shall develop their skills and potentials to
enable them to compete favorably for available opportunities.
(b) Disabled persons have the same rights as other people to take their proper
place in society. They should be able to live freely and as independently as
possible. This must be the concern of everyone the family, community and
all government and nongovernment organizations. Disabled persons' rights
must never be perceived as welfare services by the Government.
(c) The rehabilitation of the disabled persons shall be the concern of the
Government in order to foster their capacity to attain a more meaningful,
productive and satisfying life. To reach out to a greater number of disabled
persons, the rehabilitation services and benefits shall be expanded beyond
the traditional urban-based centers to community based programs, that will
ensure full participation of different sectors as supported by national and local
government agencies.
(d) The State also recognizes the role of the private sector in promoting the
welfare of disabled persons and shall encourage partnership in programs that
address their needs and concerns.
Sec. 3. Coverage. This Act shall cover all disabled persons and, to the
extent herein provided, departments, offices and agencies of the National
Government or nongovernment organizations involved in the attainment of
the objectives of this Act.
Sec. 4. Definition of Terms. For purposes of this Act, these terms are
defined as follows:
(a) Disabled persons are those suffering from restriction or different abilities,
as a result of a mental, physical or sensory impairment, to perform an activity
in the manner or within the range considered normal for a human being;
(j) Auxiliary Social Services are the supportive activities in the delivery of
social services to the marginalized sectors of society;
(k) Marginalized Disabled Persons refer to disabled persons who lack access to
rehabilitative services and opportunities to be able to participate fully in
socioeconomic activities and who have no means of livelihood and whose
incomes fall below the poverty threshold; chan robles virtual law library
(m) Readily Achievable means a goal can be easily attained and carried out
without much difficulty or expense. In determining whether an action is
readily achievable, factors to be considered include
(2) the overall financial resources of the facility or facilities involved in the
action; the number of persons employed at such facility; the effect on
expenses and resources, or the impact otherwise of such action upon the
operation of the facility;
(3) the overall financial resources of the covered entity with respect to the
number of its employees; the number, type and location of its facilities; and
(4) the type of operation or operations of the covered entity, including the
composition, structure and functions of the work force of such entity; the
geographic separateness, administrative or fiscal relationship of the facility or
facilities in question to the covered entity.
(n) Public Transportation means transportation by air, land and sea that
provides the public with general or special service on a regular and continuing
basis;
CHAPTER I
EMPLOYMENT
Five percent (5%) of all casual emergency and contractual positions in the
Departments of Social Welfare and Development; Health; Education, Culture
and Sports; and other government agencies, offices or corporations engaged
in social development shall be reserved for disabled persons.
(b) Private entities that employ disabled persons who meet the required skills
or qualifications, either as regular employee, apprentice or learner, shall be
entitled to an additional deduction, from their gross income, equivalent to
twenty-five percent (25%) of the total amount paid as salaries and wages to
disabled persons: Provided, however, That such entities present proof as
certified by the Department of Labor and Employment that disabled persons
are under their employ: Provided, further, That the disabled employee is
accredited with the Department of Labor and Employment and the
Department of Health as to his disability, skills and qualifications.
(c) Private entities that improve or modify their physical facilities in order to
provide reasonable accommodation for disabled persons shall also be entitled
to an additional deduction from their net taxable income, equivalent to fifty
percent (50%) of the direct costs of the improvements or modifications. This
Section, however, does not apply to improvements or modifications of
facilities required under Batas Pambansa Bilang 344.
The State shall also take measures to ensure the provision of vocational
rehabilitation and livelihood services for disabled persons in the rural areas. In
addition, it shall promote cooperation and coordination between the
government and nongovernmental organizations and other private entities
engaged in vocational rehabilitation activities.
CHAPTER II
EDUCATION
Sec. 12. Access to Quality Education. The State shall ensure that disabled
persons are provided with access to quality education and ample
opportunities to develop their skills. It shall take appropriate steps to make
such education accessible to all disabled persons. It shall be unlawful for any
learning institution to deny a disabled person admission to any course it offers
by reason of handicap or disability.
The State shall take into consideration the special requirements of disabled
persons in the formulation of educational policies and programs. It shall
encourage learning institutions to take into account the special needs of
disabled persons with respect to the use of school facilities, class schedules,
physical education requirements, and other pertinent consideration.
The State shall also promote the provision by learning institutions, especially
higher learning institutions of auxiliary services that will facilitate the learning
process for disabled persons.
Sec. 13. Assistance to Disabled Students. The State shall provide financial
assistance to economically marginalized but deserving disabled students
pursuing post secondary or tertiary education. Such assistance may be in the
form of scholarship grants, student loan programs, subsidies, and other
incentives to qualified disabled students in both public and private schools. At
least five percent (5%) of the allocation for the Private Education Student
Financial Assistance Program created by virtue of R.A. 6725 shall be set aside
for disabled students pursuing vocational or technical and degree courses.
Sec. 14. Special Education. The State shall establish, maintain and support
complete, adequate and integrated system of special education for the
visually impaired, hearing impaired, mentally retarded persons and other
types of exceptional children in all regions of the country. Toward this end, the
Department of Education, Culture and Sports shall establish, special education
classes in public schools in cities, or municipalities. It shall also establish,
where viable, Braille and Record Libraries in provinces, cities or
municipalities.
The National Government shall allocate funds necessary for the effective
implementation of the special education program nationwide. Local
government units may likewise appropriate counterpart funds to supplement
national funds.
Sec. 15. Vocational or Technical and Other Training Programs. The State
shall provide disabled persons with training in civics, vocational efficiency,
sports and physical fitness, and other skills. The Department of Education,
Culture and Sports shall establish in at least one government-owned
vocational and technical school in every province a special vocational and
technical training program for disabled persons. It shall develop and
implement sports and physical fitness programs specifically designed for
disabled persons taking into consideration the nature of their handicap.
Sec. 17. State Universities and Colleges. If viable and needed, the State
University or State College in each region or province shall be responsible for
(a) the development of material appliances and technical aids for disabled
persons; (b) the development of training materials for vocational rehabilitation
and special education instructions; (c) the research on special problems,
particularly of the visually-impaired, hearing-impaired, speech-impaired, and
orthopedically-impaired students, mentally retarded, and multi-handicapped
and others, and the elimination of social barriers and discrimination against
disabled persons; and (d) inclusion of the Special Education for Disabled
(SPED) course in the curriculum.
The National Government shall provide these state universities and colleges
with necessary special facilities for visually-impaired, hearing-impaired,
speech-impaired, and orthopedically-impaired students. It shall likewise
allocate the necessary funds in support of the above.
CHAPTER III
HEALTH
Sec. 20. Health Services. The State shall protect and promote the right to
health of disabled persons and shall adopt an integrated and comprehensive
approach to their health development which shall make essential health
services available to them at affordable cost.
CHAPTER IV
AUXILIARY SOCIAL SERVICES
Sec. 21. Auxiliary Social Services. The State shall ensure that marginalized
persons are provided with the necessary auxiliary services that will restore
their social functioning and participation in community affairs. Towards this
end, the Department of Social Welfare and Development shall develop and
implement programs on auxiliary social services that respond to the needs of
marginalized disabled persons. The components of such a program shall be as
follows:
(a) assistance in the acquisition of prosthetic devices and medical intervention
of specialty services;
(d) provision of family care services geared towards developing the capability
of families to respond to the needs of the disabled members of the family;
(e) provision of substitute family care services and the facilities therefor for
abandoned, neglected, abused and unattached disabled persons who need
custodial care;
(f) provision of after care and follow-up services for the continued
rehabilitation in a community-based setting of disabled persons who were
released from residential care or rehabilitation centers; and
(g) provision of day care services for disabled children of pre-school age.
CHAPTER V
TELECOMMUNICATIONS
Sec. 24. Free Postal Charges for the Disabled. Postal charges shall be free
on the following:
(a) articles and literatures like books and periodicals, orthopedic and other
devices, and teaching aids for the use of the disabled sent by mail within the
Philippines and abroad; and
(b) aids and orthopedic devices for the disabled sent by abroad by mail for
repair:
Provided, That the aforesaid items are for personal purposes only: Provided,
further, That the disabled person is a marginalized disabled as certified by the
Social Welfare and Development Office of the local government unit
concerned or the Department of Social Welfare and Development.
CHAPTER VI
ACCESSIBILITY
Sec. 25. Barrier-Free Environment. The State shall ensure the attainment
of a barrier-free environment that will enable disabled persons to have access
in public and private buildings and establishments and such other places
mentioned in Batas Pambansa Bilang 344, otherwise known as the
"Accessibility Law".
The national and local governments shall allocate funds for the provision of
architectural facilities or structural features for disabled persons in
government buildings and facilities.
Sec. 26. Mobility. The State shall promote the mobility of disabled persons.
Disabled persons shall be allowed to drive motor vehicles, subject to the rules
and regulations issued by the Land Transportation Office pertinent to the
nature of their disability and the appropriate adaptations or modifications
made on such vehicles.
The said department shall also allocate such funds as may be necessary for
the effective implementation of the public transport program for the disabled
persons.
CHAPTER VII
POLITICAL AND CIVIL RIGHTS
Sec. 31. Right to Organize. The State recognizes the right of disabled
persons to form organizations or associations that promote their welfare and
advance or safeguard their interests. The National Government, through its
agencies, instrumentalities and subdivisions, shall assist disabled persons in
establishing self-help organizations by providing them with necessary
technical and financial assistance.
TITLE III
PROHIBITION ON DISCRIMINATION AGAINST DISABLED PERSONS
CHAPTER I
DISCRIMINATION ON EMPLOYMENT
(2) first aid and safety personnel may be informed, when appropriate, if the
disability may require emergency treatment;
(4) the results of such examination are used only in accordance with this Act.
CHAPTER II
DISCRIMINATION ON TRANSPORTATION
CHAPTER III
DISCRIMINATION ON THE USE OF PUBLIC ACCOMMODATIONS AND SERVICES
(e) a bakery, grocery store, hardware store, shopping center, or other sales or
rental establishment;
(f) a bank, barber shop, beauty shop, travel service, funeral parlor, gas
station, office of a lawyer, pharmacy, insurance office, professional office of a
health care provider, hospital or other service establishment;
(g) a terminal, depot, or other station used for specified public transportation;
(1) the imposition or application of eligibility criteria that screen out or tend to
screen out an individual with a disability or any class or individuals with
disabilities from fully and equally enjoying any goods, services, facilities,
privileges, advantages, or accommodations, unless such criteria can be shown
to be necessary for the provision of the goods, services, facilities, privileges,
or accommodations being offered;
(3) failure to take such steps as may be necessary to ensure that no individual
with a disability is excluded, denied services, segregated or otherwise treated
differently than other individuals because of the absence of auxiliary aids and
services, unless the entity can demonstrate that taking such steps would
fundamentally alter the nature of the good, service, facility, privilege,
advantage or accommodation being offered or would result in undue burden;
(5) where an entity can demonstrate that the removal of a barrier under
clause (4) is not readily achievable, a failure to make such goods, services,
facilities, privileges, advantages, or accommodations available through
alternative methods if such methods are readily achievable.
TITLE IV
FINAL PROVISIONS
Sec. 39. Housing Program. The National Government shall take into
consideration in its national shelter program the special housing requirements
of disabled persons.
Sec. 40. Role of National Agencies and Local Government Units. Local
government units shall promote the establishment of organizations of
disabled persons in their respective territorial jurisdictions. National agencies
and local government units may enter into joint ventures with organizations or
associations of disabled persons to explore livelihood opportunities and other
undertakings that shall enhance the health, physical fitness and the economic
and social well-being of disabled persons.
Sec. 42. Tax Incentives. (a) Any donation, bequest, subsidy or financial aid
which may be made to government agencies engaged in the rehabilitation of
disabled persons and organizations of disabled persons shall be exempt from
the donor's tax subject to the provisions of Section 94 of the National Internal
Revenue Code (NIRC), as amended and shall be allowed as deductions from
the donor's gross income for purposes of computing the taxable income
subject to the provisions of Section 29 (h) of the Code.
(b) Donations from foreign countries shall be exempt from taxes and duties on
importation subject to the provisions of Section 105 of the Tariff and Customs
Code of the Philippines, as amended, Section 103 of the NIRC, as amended
and other relevant laws and international agreements.
(16) exemption from taxes and duties on imported spare parts; and
(17) exemption from wharfage dues and any export tax, duty, impost and
fee.
Sec. 43. Continuity Clause. Should any department or agency tasked with
the enforcement or formulation of rules and regulations and guidelines for
implementation of any provision of this Act is abolished, merged with another
department or agency or modified, such shall not affect the enforcement or
formulation of rules, regulations and guidelines for implementation of this Act
to the effect that
(a) In case of abolition, the department or agency established to replace the
abolished department or agency shall take-over the functions under this Act of
the abolished department or agency.
(2) any person or group or persons has been discriminated against under this
Act and such discrimination raises an issue of general public importance, the
Secretary of Justice may commence a legal action in any appropriate court.
Sec. 45. Authority of Court. The court may grant any equitable relief that
such court considers to be appropriate, including, to the extent required by
this Act:
(a) granting temporary, preliminary or permanent relief;
Sec. 46. Penal Clause. (a) Any person who violates any provision of this Act
shall suffer the following penalties:
(1) for the first violation, a fine of not less than Fifty thousand pesos
(P50,000.00) but not exceeding One hundred thousand pesos (P100,000.00)
or imprisonment of not less than six (6) months but not more than two (2)
years, or both at the discretion of the court; and
(2) for any subsequent violation, a fine of not less than One hundred thousand
pesos (P100,000.00) but not exceeding Two hundred thousand pesos
(P200,000.00) or imprisonment for not less than two (2) years but not more
than six (6) years, or both at the discretion of the court.
(b) Any person who abuses the privileges granted herein shall be punished
with imprisonment of not less than six (6) months or a fine of not less than
Five thousand pesos (P5,000.00), but not more than Fifty thousand pesos
(P50,000.00), or both, at the discretion of the court.
Sec. 47. Appropriations. The amount necessary to carry out the provisions
of this Act shall be included in the General Appropriations Act of the year
following its enactment into law and thereafter.
Sec. 48. Separability Clause. Should any provisions of this Act be found
unconstitutional by a court of law, such provisions shall be severed from the
remainder of the Act, and such action shall not affect the enforceability of the
remaining provisions of this Act.
Sec. 49. Repealing Clause. All laws, presidential decrees, executive orders
and rules and regulations inconsistent with the provisions of this Act are
hereby repealed or modified accordingly.
Sec. 50. Effectivity. This Act shall take effect fifteen (15) days after its
publication in any two (2) newspapers of general circulation.
R.A. 9208
It shall be a State policy to recognize the equal rights and inherent human
dignity of women and men as enshrined in the United Nations Universal
Declaration on Human Rights, United Nations Convention on the Rights of the
Child, United Nations Convention on the Protection of Migrant Workers and
their Families. United Nations Convention Against Transnational Organized
Crime Including its Protocol to Prevent, Suppress and Punish Trafficking in
Persons, Especially Women and Children and all other relevant and universally
accepted human rights instruments and other international conventions to
which the Philippines is a signatory.
(b) Child - refers to a person below eighteen (18) years of age or one who is
over eighteen (18) but is unable to fully take care of or protect himself/herself
from abuse, neglect, cruelty, exploitation, or discrimination because of a
physical or mental disability or condition.
(c) Prostitution - refers to any act, transaction, scheme or design involving the
use of a person by another, for sexual intercourse or lascivious conduct in
exchange for money, profit or any other consideration.
(d) Forced Labor and Slavery - refer to the extraction of work or services from
any person by means of enticement, violence, intimidation or threat, use of
force or coercion, including deprivation of freedom, abuse of authority or
moral ascendancy, debt-bondage or deception.
(g) Debt Bondage - refers to the pledging by the debtor of his/her personal
services or labor or those of a person under his/her control as security or
payment for a debt, when the length and nature of services is not clearly
defined or when the value of the services as reasonably assessed is not
applied toward the liquidation of the debt.
(i) Council - shall mean the Inter-Agency Council Against Trafficking created
under Section 20 of this Act.
(e) To facilitate, assist or help in the exit and entry of persons from/to the
country at international and local airports, territorial boundaries and seaports
who are in possession of unissued, tampered or fraudulent travel documents
for the purpose of promoting trafficking in persons;
(g) To knowingly benefit from, financial or otherwise, or make use of, the labor
or services of a person held to a condition of involuntary servitude, forced
labor, or slavery.
(b) When the adoption is effected through Republic Act No. 8043, otherwise
known as the "Inter-Country Adoption Act of 1995" and said adoption is for the
purpose of prostitution, pornography, sexual exploitation, forced labor,
slavery, involuntary servitude or debt bondage;
(e) When the trafficked person is recruited to engage in prostitution with any
member of the military or law enforcement agencies;
Section 9. Venue. - A criminal action arising from violation of this Act shall be
filed where the offense was committed, or where any of its elements occurred,
or where the trafficked person actually resides at the time of the commission
of the offense: Provided, That the court where the criminal action is first filed
shall acquire jurisdiction to the exclusion of other courts.
Section 10. Penalties and Sanctions. - The following penalties and sanctions
are hereby established for the offenses enumerated in this Act:
(a) Any person found guilty of committing any of the acts enumerated in
Section 4 shall suffer the penalty of imprisonment of twenty (20) years and a
fine of not less than One million pesos (P1,000,000.00) but not more than Two
million pesos (P2,000,000.00);
(b) Any person found guilty of committing any of the acts enumerated in
Section 5 shall suffer the penalty of imprisonment of fifteen (15) years and a
fine of not less than Five hundred thousand pesos (P500,000.00) but not more
than One million pesos (P1,000,000.00);
(c) Any person found guilty of qualified trafficking under Section 6 shall suffer
the penalty of life imprisonment and a fine of not less than Two million pesos
(P2,000,000.00) but not more than Five million pesos (P5,000,000.00);
(d) Any person who violates Section 7 hereof shall suffer the penalty of
imprisonment of six (6) years and a fine of not less than Five hundred
thousand pesos (P500,000.00) but not more than One million pesos
(P1,000,000.00);
(f) The registration with the Securities and Exchange Commission (SEC) and
license to operate of the erring agency, corporation, association, religious
group, tour or travel agent, club or establishment, or any place of
entertainment shall be cancelled and revoked permanently. The owner,
president, partner or manager thereof shall not be allowed to operate similar
establishments in a different name;
(i) Conviction by final judgment of the adopter for any offense under this Act
shall result in the immediate rescission of the decree of adoption.
Section 11. Use of Trafficked Persons. - Any person who buys or engages the
services of trafficked persons for prostitution shall be penalized as follows:
(a) First offense - six (6) months of community service as may be determined
by the court and a fine of Fifty thousand pesos (P50,000.00); and
(b) Second and subsequent offenses - imprisonment of one (1) year and a fine
of One hundred thousand pesos (P100,000.00).
Section 12. Prescriptive Period. - Trafficking cases under this Act shall
prescribe in ten (10) years: Provided, however, That trafficking cases
committed by a syndicate or in a large scale as defined under Section 6 shall
prescribe in twenty (20) years.
The prescriptive period shall commence to run from the day on which the
trafficked person is delivered or released from the conditions of bondage and
shall be interrupted by the filing of the complaint or information and shall
commence to run again when such proceedings terminate without the
accused being convicted or acquitted or are unjustifiably stopped for any
reason not imputable to the accused.
Section 13. Exemption from Filing Fees. - When the trafficked person
institutes a separate civil action for the recovery of civil damages, he/she shall
be exempt from the payment of filing fees.
When the proceeds, properties and instruments of the offense have been
destroyed, diminished in value or otherwise rendered worthless by any act or
omission, directly or indirectly, of the offender, or it has been concealed,
removed, converted or transferred to prevent the same from being found or to
avoid forfeiture or confiscation, the offender shall be ordered to pay the
amount equal to the value of the proceeds, property or instruments of the
offense.
Section 15. Trust Fund. - All fines imposed under this Act and the proceeds
and properties forfeited and confiscated pursuant to Section 14 hereof shall
accrue to a Trust Fund to be administered and managed by the Council to be
used exclusively for programs that will prevent acts of trafficking and protect,
rehabilitate, reintegrate trafficked persons into the mainstream of society.
Such programs shall include, but not limited to, the following:
(a) Provision for mandatory services set forth in Section 23 of this Act;
(a) Department of Foreign Affairs (DFA) - shall make available its resources
and facilities overseas for trafficked persons regardless of their manner of
entry to the receiving country, and explore means to further enhance its
assistance in eliminating trafficking activities through closer networking with
government agencies in the country and overseas, particularly in the
formulation of policies and implementation of relevant programs.
The DFA shall take necessary measures for the efficient implementation of the
Machine Readable Passports to protect the integrity of Philippine passports,
visas and other travel documents to reduce the incidence of trafficking
through the use of fraudulent identification documents.
(c) Department of Labor and Employment (DOLE) - shall ensure the strict
implementation and compliance with the rules and guidelines relative to the
employment of persons locally and overseas. It shall likewise monitor,
document and report cases of trafficking in persons involving employers and
labor recruiters.
(d) Department of Justice (DOJ) - shall ensure the prosecution of persons
accused of trafficking and designate and train special prosecutors who shall
handle and prosecute cases of trafficking. It shall also establish a mechanism
for free legal assistance for trafficked persons, in coordination with the DSWD,
Integrated Bar of the Philippines (IBP) and other NGOs and volunteer groups.
(g) Philippine National Police (PNP) - shall be the primary law enforcement
agency to undertake surveillance, investigation and arrest of individuals or
persons suspected to be engaged in trafficking. It shall closely coordinate with
various law enforcement agencies to secure concerted efforts for effective
investigation and apprehension of suspected traffickers. It shall also establish
a system to receive complaints and calls to assist trafficked persons and
conduct rescue operations.
(i) Department of the Interior and Local Government (DILG) - shall institute a
systematic information and prevention campaign and likewise maintain a
databank for the effective monitoring, documentation and prosecution of
cases on trafficking in persons.
(j) Local government units (LGUs) - shall monitor and document cases of
trafficking in persons in their areas of jurisdiction, effect the cancellation of
licenses of establishments which violate the provisions of this Act and ensure
effective prosecution of such cases. They shall also undertake an information
campaign against trafficking in persons through the establishment of the
Migrants Advisory and Information Network (MAIN) desks in municipalities or
provinces in coordination with DILG, Philippine Information Agency (PIA),
Commission on Filipinos Overseas (CFO), NGOs and other concerned agencies.
They shall encourage and support community based initiatives which address
the trafficking in persons.
In implementing this Act, the agencies concerned may seek and enlist the
assistance of NGOs, people's organizations (Pos), civic organizations and other
volunteer groups.
(g) Three (3) representatives from NGOs, who shall be composed of one (1)
representative each from among the sectors representing women, overseas
Filipino workers (OFWs) and children, with a proven record of involvement in
the prevention and suppression of trafficking in persons. These
representatives shall be nominated by the government agency
representatives of the Council, for appointment by the President for a term of
three (3) years.
Section 21. Functions of the Council. - The Council shall have the following
powers and functions:
(b) Promulgate rules and regulations as may be necessary for the effective
implementation of this Act;
(d) Coordinate the programs and projects of the various member agencies to
effectively address the issues and problems attendant to trafficking in
persons;
(k) Develop the mechanism to ensure the timely, coordinated, and effective
response to cases of trafficking in persons;
(n) Adopt measures and policies to protect the rights and needs of trafficked
persons who are foreign nationals in the Philippines;
(p) Exercise all the powers and perform such other functions necessary to
attain the purposes and objectives of this Act.
(b) Counseling;
(c) Free legal services which shall include information about the victims' rights
and the procedure for filing complaints, claiming compensation and such
other legal remedies available to them, in a language understood by the
trafficked person;
Sustained supervision and follow through mechanism that will track the
progress of recovery, rehabilitation and reintegration of the trafficked persons
shall be adopted and carried out.
(c) The Country Team Approach. - The country team approach under
Executive Order No. 74 of 1993, shall be the operational scheme under which
Philippine embassies abroad shall provide protection to trafficked persons
insofar as the promotion of their welfare, dignity and fundamental rights are
concerned.
If, however, the repatriation of the trafficked persons shall expose the victims
to greater risks, the DFA shall make representation with the host government
for the extension of appropriate residency permits and protection, as may be
legally permissible in the host country.
Section 26. Extradition. - The DOJ, in consultation with DFA, shall endeavor
to include offenses of trafficking in persons among extraditable offenses.
Section 31. Separability Clause. - If, for any reason, any section or provision
of this Act is held unconstitutional or invalid, the other sections or provisions
hereof shall not be affected thereby.
Section 33. Effectivity. - This Act shall take effect fifteen (15) days from the
date of its complete publication in at least two (2) newspapers of general
circulation.
ii. when the child below fifteen (15) years of age, (i) in work where
he/she is directly under the responsibility of his/her parents or legal
guardian and where only members of the childs family are employed;
or (ii)in public entertainment or information.
(k) Hours of work include (1) all time during which a child is required
to be at a prescribed workplace, and (2) all time during which a child is
suffered or permitted to work. Rest periods of short duration during
working hours shall be counted as hours worked.
(c) The use, procuring or offering of a child for illegal or illicit activities,
including the production or trafficking of dangerous drugs or volatile
substances prohibited under existing laws; or
(a) When the child works under the sole responsibility of his/her
parents or guardian, provided that only members of the childs family
are employed.
ii. The employment does not endanger the childs life, safety, health
and morals, nor impair the childs normal development;
iii. The child is provided with at least the mandatory elementary or
secondary education; and
iv. The employer secures a work permit for the child in accordance
with Section 8-12 of these Rules.
ii. If the child is not enrolled, a brief description of the program for
education, training and skills acquisition for the child, in accordance
with Section 19 (b) of these Rules.
SECTION 12. Validity of Work Permit The work permit shall state the
period of its validity based on the employment contract of the
application for work permit, as the case may be. However, the period
of validity shall in no case exceed one year.
(a) For a child below 15 years of age, the hours of work shall not be
more than twenty (20) hours as week, provided that the work shall not
be more than four hours at any given day;
(b) For a child 15 years of age, but below 18, the hours of work shall
not be more than eight hours a day, and in no case beyond 40 hours a
week; and
SECTION 16. Ownership and Use of the Working Childs Income The
wages, salaries, earnings and other income of the working child belong
to him/her in ownership and shall be set aside primarily for his/her
support, education, or skills acquisition and secondarily to the
collective needs of the family: Provided, That not more than twenty
percent (20%) of the childs income may be used for the collective
needs of the family.
(b) If the terms and conditions set forth in the childs employment
contract and/or employers undertaking have been violated;
(d) If the employer fails to formulate and implement a program for the
education, training and skills acquisition of the child; or
2. Promote
Defined
- PTT Corp. vs CA
3. Demote
Nature
With regard to LEONARDO, the evidence shows that he abandoned his work
with the respondents after being pressed to present the customer regarding
his unauthorized solicitation of sideline work from the latter, he never
reported back to work anymore. For abandonment to constitute a valid
cause for termination of employment there must be a deliberate unjustified
refusal of the employee to resume his employment. Such element is present
in this case.
- Fuerte vs Aquino
Due Process
Due process was not observed as CALIMLIM and RICO were not given the
chance to be heard. The employers right to demote an employee requires
the observance of the twin-notice requirement. Furthermore, the transfer of
the employees to be considered a valid exercise of management
prerogatives, the employer must show that the transfer is not unreasonable,
inconvenient or prejudicial to the former; neither would it involve a
demotion in rank or a diminution of employees' salaries, privileges and other
benefits. In this case, Calimlim and Rico were being forced to accept
alternate work periods in their new jobs as janitors, otherwise they would be
unemployednot only did this new schedule entail a diminution of wages,
because they would only be allowed to work every other week, the new
schedule was also clearly for an undefined period and could continue for as
long as the management so desires. Under these circumstances, the
temporary transfer could not be a valid exercise of management
prerogatives.
4. Transfer
- OSS Security & Allied Services Inc. vs NLRC (GR# 112752 - 02/09/00)
In the case, nowhere in the record does it show that the transfer of private
respondent was anything but done in good faith, without grave abuse of
discretion, and in the best interest of the business enterprise.
Petitioner proved that the transfer was effected in good faith to comply with
reasonable request of its client, for a more disciplined service of the security
guards on detail. The renewal of the contract of petitioner hinged on the action
taken by the former on the latters request. Most contracts for security services
stipulate that the client may request the replacement of the guards assigned to
it. A relief and transfer order does not sever employment.
An employee has the right to security of tenure, but this does not give her such
vested right in her position as would deprive petitioner of its prerogative to
change her assignment a transfer where her service, as security guard, will be
most beneficial to the client.
The test for determining the validity of the transfer of employees is explained as
follows;
2. The employer must be able to show that the transfer is not reasonable,
inconvenient or prejudicial to the employee; nor does it involve a demotion
in rank or diminution of his salaries, privileges and other benefits. Should
the employer fail to overcome this burden of proof, the employees
transfer shall be tantamount to constructive dismissal.
Well-settled is the rule that it is the prerogative of the employer to transfer and
reassign employees for valid reasons and according to the requirement of its
business. An owner of a business enterprise is given considerable leeway in
managing his business. Our law recognizes certain rights, collectively called
management prerogative as inherent in the management of business
enterprises. We have consistently recognized and upheld the prerogative of
management to transfer an employee from one office to another within the
business establishment, provided that there is no demotion in rank or
diminution of his salary, benefits and other privileges and the action is not
motivated by discrimination, made in bad faith, or effected as a form of
punishment or demotion without sufficient cause. This privilege is inherent in
the right of employers to control and manage their enterprises effectively.
The right of employees to security of tenure does not give them vested rights to
their positions to the extent of depriving management of its prerogative to
change their assignments or to transfer them. Managerial prerogatives,
however, are subject to limitations provided by law, collective bargaining
agreements, and general principles of fair play and justice.
The employer bears the burden of showing that the transfer is not
unreasonable, inconvenient or prejudicial to the employee; and does not involve
a demotion in rank or a diminution of his salaries, privileges and other
benefits.18Should the employer fail to overcome this burden of proof, the
employees transfer shall be tantamount to constructive dismissal.
In this case, while the transfer of respondent from Credit and Collection
Manager to Marketing Assistant did not result in the reduction of his salary,
there was a reduction in his duties and responsibilities which amounted to a
demotion tantamount to a constructive dismissal as correctly held by the NLRC
and the CA.
ATIs transfer of Bismark IVs base from Manila to Bataan was, contrary to
Aguanzas assertions, a valid exercise of management prerogative. The transfer
of employees has been traditionally among the acts identified as a
management prerogative subject only to limitations found in law, collective
bargaining agreement, and general principles of fair play and justice. Even as
the law is solicitous of the welfare of employees, it must also protect the right of
an employer to exercise what are clearly management prerogatives. The free
will of management to conduct its own business affairs to achieve its purpose
cannot be denied.
Limits
But, like other rights, there are limits thereto. The managerial prerogative to
transfer personnel must be exercised without grave abuse of discretion, bearing
in mind the basic elements of justice and fair play. Having the right should not
be confused with the manner in which that right is exercised. Thus, it cannot be
used as a subterfuge by the employer to rid himself of an undesirable worker. In
particular, the employer must be able to show that the transfer is not
unreasonable, inconvenient or prejudicial to the employee; nor does it involve a
demotion in rank or a diminution of his salaries, privileges and other benefits.
Should the employer fail to overcome this burden of proof, the employees
transfer shall be tantamount to constructive dismissal, which has been defined
as a quitting because continued employment is rendered impossible,
unreasonable or unlikely; as an offer involving a demotion in rank and
diminution in pay.
The rule is that the transfer of an employee ordinarily lies within the ambit of
the employers prerogatives. The employer exercises the prerogative to transfer
an employee for valid reasons and according to the requirement of its business,
provided the transfer does not result in demotion in rank or diminution of the
employees salary, benefits and other privileges. In illegal dismissal cases, the
employer has the burden of showing that the transfer is not unnecessary,
inconvenient and prejudicial to the displaced employee.
Certainly the Court cannot accept the proposition that when an employee
opposes his employers decision to transfer him to another work place, there
being no bad faith or underhanded motives on the part of either party, it is the
employees wishes that should be made to prevail.
Related Cases
- Sobrepena, Jr. vs CA
5. Discipline
6. Management
7. Dismiss
Article 1. This Decree shall be known as the Labor Code of the Philippines
May 1, 1974 PD 442 was signed into law
Took effect Nov. 1, 1974
Article 2. This Code shall take effect Six months after its promulgation
RA 6715- Herrera-Veloso Law
Sen. Blas Ople Father of Labor Code
NOTE: Before the effectivity of the Labor code, there was no provision on the terms
and conditions of employment. This is the significance of the effectivity of the Labor
Code.
Police Power is an implied limitation on the Bill of Rights, since it is subject of the
far more overriding demands and requirements of the greater number. It is the
states authority to enact legislation that may interfere with personal liberty or
property in order to promote the general welfare.
The State affirms labor as a primary social economic force. It shall protect the
rights of workers and promote their welfare.
3. Doctrine of Incorporation
No person shall be deprived of life, liberty, or property without due process of law,
nor shall any person be denied the equal protection of the laws.
No involuntary servitude in any form shall exist except as a punishment for a crime
whereof the party shall have been duly convicted.
4. Non-Impairment Clause
(Sec. 10, Art. III, Constitution)
5. Requirement of Publication
Laws shall take effect after fifteen days following the completion of their publication
in the Official Gazette, unless it is otherwise provided. This Code shall take effect
one year after such publication.
G. CONSTITUTIONAL RIGHTS OF WORKERS IN LABOR STANDARDS
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.
The State shall promote the principle of shared responsibility between workers and
employers and the preferential use of voluntary modes in settling disputes, including
conciliation, and shall enforce their mutual compliance therewith to foster industrial
peace.
The State shall regulate the relations between workers and employers, recognizing the
right of labor to its just share in the fruits of production and the right of enterprises to
reasonable returns to investments, and to expansion and growth.
1. Security of Tenure
2. Humane Conditions of Work
3. Living Wage
NOTE:
Security of tenure
Workers cannot be dismissed without just and authorized causes
Workers shall be made regular after 6 months probation unless a different
period is agreed upon by the worker and the employee
Hours of work
Normal working hours of eight hours a day
Meal and rest period: meal break of less than one hour shall be considered
compensable working time
Overtime pay
Ordinary days: 25% of the basic hourly rate
Special/rest/holiday: 30% of the regular hourly rate on said days
Service charges
85 % (distribution to rank and file employees); 15% (losses, breakages,
distribution to managerial employees)
Separation pay
month pay for every year of service for authorized causes of separation
Payment of wages
Shall be paid in cash, legal tender, at or near the place of work
May be made through a bank upon written petition of majority of the workers
in establishments with 25 or more employees and within one kilometer radius
to a bank
Shall be made direct to the employees
Shall be given not less than once every 2 weeks or twice within a month at
intervals not exceeding 16 days
Labor-only contracting is prohibited and the person acting as contractor is
merely an agent of the employer
Preference of workers money claims over government and other creditors in
case of bankruptcy or liquidation of business
Employment of women
Nightwork prohibition unless allowed by the rules:
Industrial undertaking from 10 pm to 6 am
Commercial from 12 mn to 6 am
Agricultural at nighttime unless given not less than 9
consecutive hours of rest
Welfare facilities must be provided in the workplace
Prohibition against discrimination with respect to pay,
promotion, training opportunities, study, and scholarship grants
SSS Benefits
maternity
sickness
disability
retirement
death
GENERAL RULE: A Contract of Employment is the Law between the Parties (Employer -
Employee)
EXCEPTION: If the contract is contrary to Law or Public Policy, it becomes void. (Art.
1700 NCC)
R.A. 7641 is undoubtedly, a social legislation. The law has been enacted as a labor
protection measure and as a curative statue that - absent a retirement plan devised
by, an agreement with, or a voluntary grant from an employer can respond, in part at
least to the financial well-being of workers during their twilight years soon following
their life of labor. There should be little doubt about the fact that the law can apply to
labor contracts still existing at the time the statute has taken effect, and that its
benefits can be reckoned not only from the date of the laws enactment but
retroactively to the time said employment contracts have started.
The case at bar does not concern an ecclesiastical or purely religious affair as to bar
the State from taking cognizance of the same. An ecclesiastical affair is one that
concerns doctrine, creed, or form or worship of the church, or the adoption and
enforcement within a religious association of needful laws and regulations for the
government of the membership, and the power of excluding from such associations
those deemed unworthy of membership. Based on this definition, an ecclesiastical
affair involves the relationship between the church and its members and relate to
matters of faith, religious doctrines, worship and governance of the congregation. To
be concrete, examples of this so-called ecclesiastical affairs to which the State cannot
meddle are proceedings for excommunication, ordinations of religious ministers,
administration of sacraments and other activities with which attached religious
significance. The case at bar does not even remotely concern any of the above cited
examples. While the matter at hand relates to the church and its religious minister it
does not ipso facto give the case a religious significance. Simply stated, what is
involved here is the relationship of the church as an employer and the minister as an
employee. It is purely secular and has no relation whatsoever with the practice of
faith, worship or doctrines of the church. In this case, petitioner was not
excommunicated or expelled from the membership of the SDA but was terminated
from employment. Indeed, the matter of terminating an employee, which is purely
secular in nature, is different from the ecclesiastical act of expelling a member from
the religious congregation.
J. DEFINITION
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 employer.
2. Employee (Art. 212(f) Labor Code)
Any person in the employ of an employer. The term shall not be limited to the
employees of a particular employer, unless the Code so explicitly states. It shall
include any individual whose work has ceased as a result of or in connection with any
current labor dispute or because of any unfair labor practice if he has not obtained
any other substantially equivalent and regular employment.
FOUR-FOLD TEST
1. Right To Hire
2. Payment of Wages
3. Power of Dismissal
4. Control over the conduct of work
Finally, a careful review of the record shows that the worker performed his work
as driver under the petitioners supervision and control. The company
determined how, where, and when the worker performed his task. They, in fact,
requested the worker to live inside their compound so he (the worker) could be
readily available when the company needed his services. Undoubtedly, the
company exercised control over the means and methods by which the worker
accomplished his work as a driver.
(1) it mandates where and how often she is to perform her work;
(2) the wages she receives are completely controlled by WPP;
(3) she is subject to the regular disciplinary procedures of WPP;
(4) section 14 thereof clearly states that she is a permanent employee
not a Vice-President or a member of the Board of Directors;
(5) the intellectual property rights created or discovered by petitioner
during her employment shall automatically belong to private respondent
WPP [Under the Intellectual Property Code, this condition prevails if the
creator of the work subject to the laws of patent or copyright is an employee
of the one entitled to the patent or copyright]; and
(6) the disciplinary procedure states that her right of redress is through
Mindshares Chief Executive Officer for the Asia-Pacific.
This last circumstance implies that she was not even under the disciplinary
control of WPPs Board of Directors, and therefore, she could not have been a
WPP corporate officer as only the WPP Board of Directors could appoint and
terminate its own corporate officer.
To reiterate, while respondent and SSCP no longer had any legal relationship
with the termination of the Agreement, petitioners remained at their post
securing the premises of respondent while receiving their salaries, allegedly
from SSCP. Clearly, such a situation makes no sense, and the denials proffered
by respondent do not shed any light to the situation. It is but reasonable to
conclude that, with the behest and, presumably, directive of respondent,
petitioners continued with their services. Evidently, such are indicia of control
that respondent exercised over petitioners.
Such power of control has been explained as the right to control not only the
end to be achieved but also the means to be used in reaching such end. With
the conclusion that respondent directed petitioners to remain at their posts and
continue with their duties, it is clear that respondent exercised the power of
control over them; thus, the existence of an employer-employee relationship.
TWO-TIERED APPROACH
There are instances when, aside from the employers power to control the employee
with respect to the means and methods by which the work is to be accomplished,
economic realities of the employment relationship help provide a comprehensive
analysis of the true classification of the individual, whether as employee,
independent contractor, corporate officer, or some other capacity.
The better approach would therefore be to adopt a two-tiered test involving: (1)
the putative employers power to control the employee with respect to
the means and methods by which the work is to be accomplished; (2) the
underlying economic realities of the activity of relationship. Thus, the
determination of the relationship between employer and employee depends upon
the circumstances of the whole economic activity. The proper standard of economic
dependence is whether the worker is dependent on the alleged employer for his
continued employment in that line of business.
By applying the control test, there is no doubt that petitioner is an employee of the
Company because she was under the control and supervision of the latter. Under
the broader economic reality test, the petitioner can likewise be said to be an
employee of respondent corporation because she had served the company for six
years before her dismissal, receiving check vouchers indicating her salaries/
benefits, 13th month pay, bonuses and allowances as well as deductions and SSS
contributions. It is therefore apparent that petitioner is economically dependent
on respondent for her continued employment in the latters line of
business (test).
A. The (broad) extent to which the services performed are an integral part
of the employers business.
B. The (limited) extent of the workers investment in the equipment and
facilities
C. The nature (close supervision) and (high) degree of control exercised
by the employer
D. The workers (limited) opportunities for profit and loss
E. The (small) amount of initiative, skill, judgment or foresight required
for the success of the claimed independent enterprise
F. The (high degree of) permanency and duration of the relationship
between the worker and the employer
G. The degree of dependency of the worker upon the employer for his
continued employment in that line of business.
The benchmark of economic reality in analyzing possible employment
relationships for purposes of applying the Labor Code ought to be the
ECONOMIC DEPENDENCE of the worker on his employee. (Orozco vs CA 562
SCRA 36, 2008)
Main Concepts
Section 1. Short Title. - This Act shall be known and cited as the "Migrant Workers
and Overseas Filipinos Act of 1995".
(a) In the pursuit of an independent foreign policy and while considering national
sovereignty, territorial integrity, national interest and the right to self- determination
paramount in its relations with other states, the State shall, at all times, uphold the
dignity of its citizens whether in country or overseas, in general, and Filipino migrant
workers, in particular.
(b) 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. Towards this end, the State shall provide adequate and timely
social, economic and legal services to Filipino migrant workers.
(c) While recognizing the significant contribution of Filipino migrant workers to the
national economy through their foreign exchange remittances, the State does not
promote overseas employment as a means to sustain economic growth an achieve
national development. The existence of the overseas employment program rests
solely on the assurance that the dignity and fundamental human rights and freedoms
of the Filipino citizen shall not, at any time, be compromised or violated. The State,
therefore, shall continuously create local employment opportunities and promote the
equitable distribution of wealth and the benefits of development.
(d) The State affirms the fundamental equality before the law of women and men and
the significant role of women in nation-building. Recognizing the contribution of
overseas migrant women workers and their particular vulnerabilities, the State shall
apply gender sensitive criteria in the formulation and implementation of policies and
programs affecting migrant workers and the composition of bodies tasked for the
welfare of migrant workers.
(e) Free access to the courts and quasi-judicial bodies and adequate legal assistance
shall not be denied to any person by reason of poverty. In this regard, it is imperative
that an effective mechanism be instituted to ensure that the rights and interest of
distressed overseas Filipinos, in general, and Filipino migrant workers, in particular,
documented or undocumented, are adequately protected and safeguarded.
(f) The right of Filipino migrant workers and all overseas Filipinos to participate in the
democratic decision-making processes of the State and to be represented in
institutions relevant to overseas employment is recognized and guaranteed.
(g) The State recognizes that the ultimate protection to all migrant workers is the
possession of skills. Pursuant to this and as soon as practicable, the government shall
deploy and/or allow the deployment only of skilled Filipino workers.
(a) Migrant worker refers to a person who is to be engaged, is engaged or has been
engaged in a remunerated activity in a state of which he or she is not a legal
resident; to be used interchangeably with overseas Filipino worker.
(c) Overseas Filipinos refers to dependents of migrant workers and other Filipino
nationals abroad who are in distress as mentioned in Sec.s 24 and 26 of this Act.
I. DEPLOYMENT
Sec. 4. Deployment of Migrant Workers. - The State shall deploy overseas Filipino
workers only in countries where the rights of Filipino migrant workers are protected.
The government recognizes any of the following as a guarantee on the part of the
receiving country for the protection and the rights of overseas Filipino workers:
(a) It has existing labor and social laws protecting the rights of migrant workers;
(d) It is taking positive, concrete measures to protect the rights of migrant workers.
(a) To charge or accept directly or indirectly any amount greater than that specified
in the schedule of allowable fees prescribed by the Secretary of Labor and
Employment, or to make a worker pay any amount greater than that actually
received by him as a loan or advance;
(c) To give any false notice, testimony, information or document or commit any act of
misrepresentation for the purpose of securing a license or authority under the Labor
Code;
(e) To influence or attempt to influence any person or entity not to employ any
worker who has not applied for employment through his agency;
(k) To withhold or deny travel documents from applicant workers before departure for
monetary or financial considerations other than those authorized under the Labor
Code and its implementing rules and regulations;
(l) Failure to actually deploy without valid reason as determined by the Department
of Labor and Employment ; and
(m) Failure to reimburse expenses incurred by the worker in connection with his
documentation and processing for purposes of deployment, in cases where the
deployment does not actually take place without the worker's fault. Illegal
recruitment when committed by a syndicate or in large scale shall be considered an
offense involving economic sabotage. Illegal recruitment is deemed committed by a
syndicate if carried out by a group of three (3) or more persons conspiring or
confederating with one another. It is deemed committed in large scale if committed
against three (3) or more persons individually or as a group.
The persons criminally liable for the above offenses are the principals, accomplices
and accessories. In case of juridical persons, the officers having control, management
or direction of their business shall be liable.
Sec. 7. Penalties. -
(a) Any person found guilty of illegal recruitment shall suffer the penalty of
imprisonment of not less than six (6) years and one (1) day but not more than twelve
(12) years and a fine of not less than Two hundred thousand pesos (P200,000.00) nor
more than Five hundred thousand pesos (P500,000.00).
(b) The penalty of life imprisonment and a fine of not less than Five hundred
thousand pesos (P500,000.00) nor more than One million pesos (P1,000,000.00) shall
be imposed if illegal recruitment constitutes economic sabotage as defined herein.
Provided, however, That the maximum penalty shall be imposed if the person illegally
recruited is less than eighteen (18) years of age or committed by a non-licensee or
non-holder of authority.
Sec. 8. Prohibition on Officials and Employees. - It shall be unlawful for any official or
employee of the Department of Labor and Employment, the Philippine Overseas
Employment Administration (POEA), or the Overseas Workers Welfare Administration
(OWWA), or the Department of Foreign Affairs, or other government agencies
involved in the implementation of this Act, or their relatives within the fourth civil
degree of consanguinity or affinity, to engage, directly or indirectly in the business of
recruiting migrant workers as defined in this Act. The penalties provided in the
immediate preceding paragraph shall be imposed upon them.
Sec. 9. Venue. - A criminal action arising from illegal recruitment as defined herein
shall be filed with the Regional Trial Court of the province or city where the offense
was committed or where the offended party actually resides at the time of the
commission of the offense: Provided, That the court where the criminal action is first
filed shall acquire jurisdiction to the exclusion of other courts: Provided, however,
That the aforestated provisions shall also apply to those criminal actions that have
already been filed in court at the time of the effectivity of this Act.
Sec. 10. Money Claims. - Notwithstanding any provision of law to the contrary, the
Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the
original and exclusive jurisdiction to hear and decide, within ninety (90) calendar
days after the filing of the complaint, the claims arising out of an employer-employee
relationship or by virtue of any law or contract involving Filipino workers for overseas
deployment including claims for actual, moral, exemplary and other forms of
damages.
The liability of the principal/employer and the recruitment/placement agency for any
and all claims under this Sec. shall be joint and several. This provision shall be
incorporated in the contract for overseas employment and shall be a condition
precedent for its approval. The performance bond to be filed by the
recruitment/placement agency, as provided by law, shall be answerable for all money
claims or damages that may be awarded to the workers. If the
recruitment/placement agency is a juridical being, the corporate officers and
directors and partners as the case may be, shall themselves be jointly and solidarily
liable with the corporation or partnership for the aforesaid claims and damages.
Such liabilities shall continue during the entire period or duration of the employment
contract and shall not be affected by any substitution, amendment or modification
made locally or in a foreign country of the said contract.
Noncompliance with the mandatory periods for resolutions of cases provided under
this Sec. shall subject the responsible officials to any or all of the following penalties:
(a) The salary of any such official who fails to render his decision or resolution within
the prescribed period shall be, or caused to be, withheld until the said official
complies therewith;
(c) Dismissal from the service with disqualification to hold any appointive public
office for five (5) years. Provided, however, That the penalties herein provided shall
be without prejudice to any liability which any such official may have incurred under
other existing laws or rules and regulations as a consequence of violating the
provisions of this paragraph.
Sec. 11. Mandatory Periods for Resolution of Illegal Recruitment Cases. - The
preliminary investigations of cases under this Act shall be terminated within a period
of thirty (30) calendar days from the date of their filing. Where the preliminary
investigation is conducted by a prosecution officer and a prima facie case is
established, the corresponding information shall be filed in court within twenty-four
(24) hours from the termination of the investigation. If the preliminary investigation is
conducted by a judge and a prima facie case is found to exist, the corresponding
information shall be filed by the proper prosecution officer within forty-eight (48)
hours from the date of receipt of the records of the case.
Sec. 12. Prescriptive Periods. - Illegal recruitment cases under this Act shall prescribe
in five (5) years: Provided, however, That illegal recruitment cases involving
economic sabotage as defined herein shall prescribe in twenty (20) years.
Sec. 13. Free Legal Assistance; Preferential Entitlement Under the Witness Protection
Program. - A mechanism for free legal assistance for victims of illegal recruitment
shall be established within the Department of Labor and Employment including its
regional offices. Such mechanism must include coordination and cooperation with the
Department of Justice, the Integrated Bar of the Philippines, and other non-
governmental organizations and volunteer groups.
The provisions of Republic Act No. 6981 to the contrary notwithstanding, any person
who is a victim of illegal recruitment shall be entitled to the Witness Protection
Program provided thereunder.
III. SERVICES
Sec. 14. Travel Advisory/Information Dissemination. - To give utmost priority to the
establishment of programs and services to prevent illegal recruitment, fraud and
exploitation or abuse of Filipino migrant workers, all embassies and consular offices,
through the Philippine Overseas Employment Administration (POEA), shall issue
travel advisories or disseminate information on labor and employment conditions,
migration realities and other facts; and adherence of particular countries to
international standards on human and workers' rights which will adequately prepare
individuals into making informed and intelligent decisions about overseas
employment. Such advisory or information shall be published in a newspaper of
general circulation at least three (3) times in every quarter.
For this purpose, there is hereby created and established an emergency repatriation
fund under the administration, control and supervision of the OWWA, initially to
consist of One hundred million pesos (P100,000,000.00), which shall be taken from
the existing fund controlled and administered by the OWWA. Thereafter, such fund
shall be provided for in the General Appropriations Act from year to year: Provided,
That the amount appropriated shall in no case be less than One hundred million
pesos (P100,000,000.00), inclusive of outstanding balances.
Sec. 17. Establishment of Re-placement and Monitoring Center. - A re- placement and
monitoring center is hereby created in the Department of Labor and Employment for
returning Filipino migrant workers which shall provide a mechanism for their
reintegration into the Philippine society, serve as a promotion house for their local
employment, and tap their skills and potentials for national development.
For this purpose, the Technical Education and Skills Development Authority (TESDA),
the Technology Livelihood Resource Center (TLRC), and other government agencies
involved in training and livelihood development shall give priority to returnees who
had been employed as domestic helpers and entertainers.
Sec. 18. Functions of the Re-placement and Monitoring Center. - The Center shall
provide the following services:
(a) Develop livelihood programs and projects for returning Filipino migrant workers in
coordination with the private sector;
(b) Coordinate with appropriate private and government agencies in the promotion,
development, re-placement and the full utilization of their potentials;
(d) Provide a periodic study and assessment of job opportunities for returning Filipino
migrant workers; and
(e) Develop and implement other appropriate programs to promote the welfare of
returning Filipino migrant workers.
Sec. 19. Establishment of a Migrant Workers and other Overseas Filipinos Resource
Center. - Within the premises and under the administrative jurisdiction of the
Philippine Embassy in countries where there are large concentrations of Filipino
migrant workers, there shall be established a Migrant Workers and Other Overseas
Filipinos Resource Center with the following services:
(c) Information, advisory and programs to promote social integration such as post-
arrival orientation, settlement and community networking services and activities for
social interaction;
(f) Gender sensitive program and activities to assist particular needs of women
migrant workers;
(g) Orientation program for returning worker and other migrants; and
The establishment and operations of the Center shall be a joint undertaking of the
various government agencies. The Center shall be open for twenty-four (24) hours
daily including Saturdays, Sunday and holidays, and shall be staffed by Foreign
Service personnel, service attaches or officers who represent other Philippine
government agencies abroad and, if available, individual volunteers and bona fide
non-government organizations from the host countries. In countries categorized as
highly problematic by the Department of Foreign Affairs and the Department of Labor
and Employment and where there is a concentration of Filipino migrant workers, the
government must provide a lawyer and a social worker for the Center. The Labor
Attache shall coordinate the operation of the Center and shall keep the Chief of
Mission informed and updated on all matters affecting it.
The Center shall have a counterpart 24-hour information and assistance center at the
Department of Foreign Affairs to ensure a continuous network and coordinative
mechanism at the home office.
(b) Inventory of pending legal cases involving Filipino migrant workers and other
Filipino nationals, including those serving prison terms;
(f) Basic data on legal systems, immigration policies, marriage laws and civil and
criminal codes in receiving countries particularly those with large numbers of
Filipinos;
(g) List of labor and other human rights instruments where receiving countries are
signatories;
(h) A tracking system of past and present gender disaggregated cases involving male
and female migrant workers; and
(i) Listing of overseas posts which may render assistance to overseas Filipinos, in
general, and migrant workers, in particular.
Sec. 21. Migrant Workers Loan Guarantee Fund. - In order to further prevent
unscrupulous illegal recruiters from taking advantage of workers seeking
employment abroad, the OWWA, in coordination with government financial
institutions, shall institute financing schemes that will expand the grant of pre-
departure loan and family assistance loan. For this purpose, a Migrant Workers Loan
Guarantee Fund is hereby created and the revolving amount of One hundred million
pesos (P100,000,000.00) from the OWWA is set aside as a guarantee fund in favor of
participating government financial institutions.
Sec. 22. Rights and Enforcement Mechanism Under International and Regional
Human Rights Systems. - The Department of Foreign Affairs is mandated to
undertake the necessary initiative such as promotions, acceptance or adherence of
countries receiving Filipino workers to multilateral convention, declaration or
resolutions pertaining to the protection of migrant workers' rights. The Department of
Foreign Affairs is also mandated to make an assessment of rights and avenues of
redress under international and regional human rights systems that are available to
Filipino migrant workers who are victims of abuse and violation and, as far as
practicable and through the Legal Assistant for Migrant Workers Affairs created under
this Act, pursue the same on behalf of the victim if it is legally impossible to file
individual complaints. If a complaints machinery is available under international or
regional systems, the Department of Foreign Affairs shall fully apprise the Filipino
migrant workers of the existence and effectiveness of such legal options.
(a) Department of Foreign Affairs - The Department, through its home office or
foreign posts, shall take priority action or make representation with the foreign
authority concerned to protect the rights of migrant workers and other overseas
Filipinos and extend immediate assistance including the repatriation of distressed or
beleaguered migrant workers and other overseas Filipinos;
The said Legal Assistant for Migrant Workers Affairs, shall be appointed by the
President and must be of proven competence in the field of law with at least ten (10)
years of experience as a legal practitioner and must not have been a candidate to an
elective office in the last local or national elections.
Among the functions and responsibilities of the aforesaid Legal Assistant are:
(a) To issue the guidelines, procedures and criteria for the provision of legal
assistance services to Filipino migrant workers;
(b) To establish close linkages with the Department of Labor and Employment, the
POEA, the OWWA and other government agencies concerned, as well as with non-
governmental organizations assisting migrant workers, to ensure effective
coordination and cooperation in the provision of legal assistance to migrant workers;
(c) To tap the assistance of reputable law firms and the Integrated Bar of the
Philippines and other bar associations to complement the government's efforts to
provide legal assistance to our migrant workers;
(d) To administer the legal assistance fund for migrant workers established under
Sec. 25 thereof and to authorize disbursements therefrom in accordance with the
purposes for which the fund was set up; and
(e) To keep and maintain the information system as provided in Sec. 20.
The Legal Assistant for Migrant Workers Affairs shall have authority to hire private
lawyers, domestic or foreign, in order to assist him in the effective discharge of the
above functions.
Sec. 25. Legal Assistance Fund. - There is hereby established a legal assistance fund
for migrant workers, hereinafter referred to as the Legal Assistance Fund, in the
amount of One hundred million pesos (P100,000,000.00) to be constituted from the
following sources:
Fifty million pesos (P50,000,000.00) from the Contingency Fund of the President;
Thirty million pesos (P30,000,000.00) from the Presidential Social Fund; and
Twenty million pesos (P20,000,000.00) from the Welfare Fund for Overseas Workers
established under Letter of Instruction No. 537, as amended by Presidential Decrees
Nos. 1694 and 1809.
Any balances of existing funds which have been set aside by the government
specifically as legal assistance or defense fund to help migrant workers shall, upon
effectivity of this Act, be turned over to, and form part of, the Fund created under
this Act.
Sec. 26. Uses of the Legal Assistance Fund. - The Legal Assistance Fund created
under the preceding Sec. shall be used exclusively to provide legal services to
migrant workers and overseas Filipinos in distress in accordance with the guidelines,
criteria and procedures promulgated in accordance with Sec. 24(a) hereof. The
expenditures to be charged against the Fund shall include the fees for the foreign
lawyers to be hired by the Legal Assistant for Migrant Workers Affairs to represent
migrant workers facing charges abroad, bail bonds to secure the temporary release
of workers under detention, court fees and charges and other litigation expenses.
Sec. 27. Priority Concerns of Philippine Foreign Service Posts. - The country-team
approach, as enunciated under Executive Order No. 74, series of 1993, shall be the
mode under which Philippine embassies or their personnel will operate in the
protection of the Filipino migrant workers as well as in the promotion of their welfare.
The protection of the Filipino migrant workers and the promotion of their welfare, in
particular, and the protection of the dignity and fundamental rights and freedoms of
the Filipino citizen abroad, in general, shall be the highest priority concerns of the
Secretary of Foreign Affairs and the Philippine Foreign Service Posts.
Sec. 28. Country-Team Approach. - Under the country-team approach, all officers,
representatives and personnel of the Philippine government posted abroad
regardless of their mother agencies shall, on a per country basis, act as one country-
team with a mission under the leadership of the ambassador. In this regard the
ambassador may recommend to the Secretary of the Department of Foreign Affairs
the recall of officers, representatives and personnel of the Philippine government
posted abroad for acts inimical to the national interest such as, but not limited to,
failure to provide the necessary services to protect the rights of overseas Filipinos.
In host countries where there are Philippine consulates, such consulates shall also
constitute part of the country-team under the leadership of the ambassador.
Sec. 30. Gradual Phase-out of Regulatory Functions. - Within a period of five (5) years
from the effectivity of this Act, the DOLE shall phase-out the regulatory functions of
the POEA pursuant to the objectives of deregulation.
Sec. 32. POEA and OWWA Board; Additional Memberships. - Notwithstanding any
provision of law to the contrary, the respective Boards of the POEA and the OWWA
shall, in addition to their present composition, have three (3) members each who
shall come from the women, sea-based and land-based sectors respectively, to be
appointed by the President in the same manner as the other members.
Sec. 33. Report to Congress. - In order to inform the Philippine Congress on the
implementation of the policy enunciated in Sec. 4 hereof, the Department of Foreign
Affairs and the Department of Labor and Employment shall submit to the said body a
semi- annual report of Philippine foreign posts located in countries hosting Filipino
migrant workers. The report shall include, but shall not be limited to, the following
information:
(a) Masterlist of Filipino migrant workers, and inventory of pending legal cases
involving them and other Filipino nationals including those serving prison terms;
(d) Initiatives/actions taken by the Philippine foreign posts to address the problems of
Filipino migrant workers;
(f) Status of negotiations on bilateral labor agreements between the Philippines and
the host country.
Any officer of the government who fails to report as stated in the preceding Sec. shall
be subject to administrative penalty.
Sec. 35. Exemption from Travel Tax and Airport Fee. - All laws to the contrary
notwithstanding, the migrant worker shall be exempt from the payment of travel tax
and airport fee upon proper showing of proof of entitlement by the POEA.
Sec. 36. Non-increase of Fees; Abolition of Repatriation Bond. - Upon approval of this
Act, all fees being charged by any government office on migrant workers shall remain
at their present levels and the repatriation bond shall be abolished.
Sec. 37. The Congressional Migrant Workers Scholarship Fund. - There is hereby
created a Congressional Migrant Workers Scholarship Fund which shall benefit
deserving migrant workers and/or their immediate descendants below twenty-one
(21) years of age who intend to pursue courses or training primarily in the field of
science and technology. The initial seed fund of Two hundred million pesos
(P200,000,000.00) shall be constituted from the following sources:
(b) The remaining One hundred fifty million pesos (P150,000,000.00) shall be funded
from the proceeds of Lotto draws.
Sec. 38. Appropriation and Other Sources of Funding. - The amount necessary to
carry out the provisions of this Act shall be provided for in the General Appropriations
Act of the year following its enactment into law and thereafter.
Sec. 39. Migrant Workers Day. - The day of signing by the President of this Act shall
be designated as the Migrant Workers Day and shall henceforth be commemorated
as such annually.
Sec. 40. Implementing Rules and Regulations. - The departments and agencies
charged with carrying out the provisions of this Act shall, within ninety (90) days after
the effectivity of this Act, formulate the necessary rules and regulations for its
effective implementation.
Sec. 41. Repealing Clause. - All laws, decrees, executive orders, rules and
regulations, or parts thereof inconsistent with the provisions of this Act are hereby
repealed or modified accordingly.
Sec. 42. Separability Clause. - If, for any reason, any Sec. or provision of this Act is
held unconstitutional or invalid, the other Sec.s or provisions hereof shall not be
affected thereby.
Sec. 43. Effectivity Clause. - This Act shall take effect after fifteen (15) days from its
publication in the Official Gazette or in at least two (2) national newspapers of
general circulation whichever comes earlier
Constitutionality
The equal protection clause is directed principally against undue favor and
individual or class privilege. It is not intended to prohibit legislation which is
limited to the object to which it is directed or by the territory in which it is to
operate. It does not require absolute equality, but merely that all persons be
treated alike under like conditions both as to privileges conferred and liabilities
imposed.
1. The accused undertook any recruitment activity defined under Art. 13(b) or
any prohibited practice enumerated under Art. 34 of the Labor Code;
Q: Art. 20 of the RPC provides for Accessories who are exempt from Criminal
Liability, will this also apply here in R.A. 8042?
A:
SEC. 10. MONEY CLAIMS. Both withstanding any provision of law to the contrary,
the Labor Arbiters of the National Labor Relations Commission (NLRC) shall
have the original and exclusive jurisdiction to hear and decide, within
ninety (90) calendar days after filing of the complaint, the claims arising out of
an employer-employee relationship or by virtue of any law or contract
involving Filipino workers for overseas deployment (prior to R.A. 8042, jurisdiction
was with the POEA and covered only Filipinos employed overseas) including
claims for actual, moral, exemplary and other forms of damages.
Such liabilities shall continue during the entire period or duration of the
employment contract and shall not be affected by any substitution, amendment
or modification made locally or in a foreign country of the said contract.
Any compromise/amicable settlement or voluntary agreement on
money claims inclusive of damages under this section shall be paid within four (4)
months from the approval of the settlement by the appropriate authority.
a. The salary of any such official who fails to render his decision or
resolutions within the prescribed period shall be, or caused to be,
withheld until the said official complies therewith;
b. Suspension for not more than ninety (90) days; or
c. Dismissal from the service with disqualifications to hold any
appointive public office for five (5) years.
R.A. 8042 has transferred from the POEA to the NLRC the jurisdiction over OFWs
claims arising from employer-employee relationship. But POEA retains original
and exclusive jurisdiction over cases involving violations of POEA Rules
and Regulations, disciplinary cases and other cases that are
administrative in character involving OFWs.
1) Prostitution;
2) Unjust refusal to depart for the worksite;
3) Gunruning or possession of deadly weapons;
4) Vandalism or destroying company property;
5) Violation of the laws and sacred practices of the host country and
unjustified breach of employment contract;
6) Embezzlement of funds of the company or fellow worker entrusted for
delivery to relatives in the Philippines;
7) Creating trouble at the worksite or in the vessel;
8) Gambling;
9) Initiating or joining a strike or work stoppage where the laws of the
host country prohibit strikes or similar actions;
10) Commission of Felony punishable by Philippine Laws or by the host
country;
11) Theft or robbery;
12) Drunkenness;
13) Drug Addiction or possession or trafficking of prohibited drugs; and
14) Desertion or abandonment
The recruitment agency is solidarily liable with the foreign principal for unpaid
salaries of worker it recruited. Before recruiting, the agency is required to
submit a document containing its power to sue and to be sued jointly and
solidarily with the principal or foreign-based employer for any of the violations
of the recruitment agreement, and the contracts of employment.
Nota Bene:
The recruitment agency may still be sued even if the agency agreement
between recruitment agency and the principal is already severed if no notice
of the termination was given to the employee based on Article 1921 of the
New Civil Code. (Catan vs. NLRC)
Contract by Principal
Even if it was the principal of the manning agency who entered into contract
with the employee, the manning agent in the Philippines is jointly and
severally liable with the principal. (Seagull Maritime Corp. vs. Balatongan)
Exceptions:
In host countries where there are Philippine consulates, such consulates shall also
constitute part of the country-team under the leadership of the ambassador.
The fact that appellant did not receive any payment for the promised or offered
employment is f no moment. From the language of the statute, the act of
recruitment may be "for profit or not"; it suffices that the accused "promises or
offers for a fee employment" to warrant conviction for illegal recruitment. (Sec. 6
of R.A. 8042)
3. Illegal Recruitment
Definition
(Sec. 6 of R.A. 8042)
DEFINITIONS. - For purposes of this Act, illegal recruitment shall mean any act of
canvassing, enlisting, contracting, transporting, utilizing, hiring, procuring
workers and includes referring, contact services, promising or advertising for
employment abroad, whether for profit or not, when undertaken by a non-license
or non-holder of authority contemplated under Article 13(f) of Presidential Decree
No. 442, as amended, otherwise known as the Labor Code of the Philippines.
Provided, that such non-license or non-holder, who, in any manner, offers or
promises for a fee employment abroad to two or more persons shall be deemed
so engaged. It shall likewise include the following acts, whether committed by any
persons, whether a non-licensee, non-holder, licensee or holder of authority.
The persons criminally liable for the above offenses are the principals,
accomplices and accessories. In case of juridical persons, the officers having
control, management or direction of their business shall be liable.
Economic Sabotage
(People vs Buli-E)
Under Art. 13(b) of the Labor Code, recruitment and placement refer to any act
of canvassing, enlisting, contracting, transporting, utilizing hiring, or procuring
of workers, and includes referrals, contract services, promising or advertising
for employment, locally or abroad, whether for profit or not; provided that any
person or entity which, in any manner, offers or promises or a fee employment
to two or more persons shall be deemed engaged in recruitment or placement.
1. The accused undertook any recruitment activity defined under Art. 13(b) or
any prohibited practice enumerated under Art. 34 of the Labor Code;
2. He did not have a license or authority to lawfully engage in the recruitment
and placement of workers;
3. He committed the same against three (3) or more persons, individually or as
a group.
First, the offender has no valid license or authority required by law to enable
one to engage lawfully in recruitment and placement of workers.
The corp. obviously acts, and can act, only by and through its human agents,
and it is their conduct which the law must deter. The employee or agent of a
corp. engaged in unlawful business naturally aids and abets in the carrying on
of such business and will be prosecuted as principal if, with knowledge of the
business, its purpose and effect, he consciously contributes his efforts to its
conduct and promotion, however slight his contribution may be.
The law of Agency, as applied in civil cases, has no application in criminal cases,
and no man can escape punishment when he participates in the commission of
a crime upon the ground that he simply acted as an agent of any party. The
culpability of the employee therefore hinges on his knowledge of the offense
and his active participation in its commission.
Where it is shown that the employee was merely acting under the direction of
his superiors and was unaware that his acts constituted a crime, he may not be
held criminally liable for an act done for and in behalf of his employer.
The estafa cases pending before the courts will not bar a prosecution for illegal
recruitment, since they are entirely different offenses and neither one
necessarily includes or is necessarily included in the other.
- ADMINISTRATIVE LIABILITY
- CRIMINAL LIABILITY
The following elements of Estafa under Art. 315(2-a) are also present in this
case for Illegal Recruitment, to wit:
Appelant misrepresented himself to Jaime Cabus and Roberto Perlas as one who
can make arrangements for job placements in Taiwan and Japan and, by reason
of such misrepresentations, the two complainants were induced to part with
their money, causing them damage.
(People vs Ramon Dujua, GR# 149014-16 02/05/04)
C. WAGES
1. Basic Concept and Principles
Characteristics of Wages
(Art. 97(f) Labor Code)
"Wage" paid to any employee shall mean the remuneration or earnings, however
designated, capable of being expressed in terms of money, whether fixed or
ascertained on a time, task, piece, or commission basis, or other method
of calculating the same, which is payable by an employer to an employee
under a written or unwritten contract of employment for work done or to be done,
or for services rendered or to be rendered and includes the fair and reasonable
value, as determined by the Secretary of Labor and Employment, of board,
lodging, or other facilities customarily furnished by the employer to the
employee. "Fair and reasonable value" shall not include any profit to the
employer, or to any person affiliated with the employer.
NOTE: The last sentence of Art. 97 is the basis for the concept of FACILITIES.
Wage vs Salary
WAGE SALARY
Compensation for skilled or unskilled Paid to white collar workers or
manual labor; refers to WORKERS PROFESSIONALS and denote a higher
grade of employment
Under Art. 1708 Civil Code, it is not It is not exempt from execution,
subject to execution, garnishment or garnishment or attachment.
attachment.
EXCEPT:
For debts related to food, clothing,
shelter, medicines.
NOTE:
Non-Diminution of Benefits
Concept
The principle of non-diminution of benefits states that: any benefit and
supplement being enjoyed by employees cannot be reduced, diminished,
discontinued or eliminated by the employer.
Common application
In employment setting, the principle of non-diminution of benefits finds
application when a change initiated by the employer to existing company policies,
specially matters concerning employee benefits, results in reduction, diminution
or withdrawal of some or all of the the benefits already enjoyed by the
employees. For example, if the employees of a certain company is traditionally
granted 14th month pay, and the employer subsequently withdrew such benefit,
or reduced its amount, the reduction or withdrawal is objectionable on the ground
that it would result to diminution of benefits.
Requirements
The application of the principle presupposes that a company practice, policy and
tradition favorable to the employees has been clearly established; and that the
payments made by the company pursuant to it have ripened into benefits
enjoyed by them.
To ripen into benefits, the following requisites must concur:
1. It should have been practiced over a long period of time; and
2. It must be shown to have been consistent and deliberate.
With regard to the length of time the company practice should have been
exercised to constitute voluntary employer practice which cannot be unilaterally
withdrawn by the employer, the Court has not laid down any rule requiring a
specific minimum number of years.
In all these cases, the grant of benefits has been held to have ripened into
company practice or policy which cannot be peremptorily withdrawn.
In this case, the overpayment of the employees was a result of an error, hence
there is no diminution.
(TSPIC Corp. vs TSPIC Employees Union, GR# 163419 02/13/08)
The receipt of an allowance on a monthly basis does not ispo facto characterize
it as regular and forming part of salary because the nature of the grant is a
factor worth considering. We agree with the observation of the Office of the
Solicitor General that the subject allowances were temporarily, not regularly
received by petitioners because - in the case of housing allowance, once a
vacancy occurs in the company provided housing accommodations, the
employee concerned transfers to the company premises and his housing
allowance is discontinued.
On the other hand, the transportation allowance is in the form of advances for
actual transportation expenses subject to liquidation given only to employees
who have personal cars. The Bislig allowance is given to Division Managers and
corporate officers assigned in Bislig, Surigao del Norte. Once the officer is
transferred outside of Bislig, the allowance stops.
When the conditions for the availment of the allowances ceased to exist, the
allowance likewise ceased. Petitioners continuous enjoyment of the disputed
allowances was based on contingencies, and hence are not part of wages and
may be eliminates.
(Millares vs NLRC - 03/29/99)
- DIMINUTION MAY MEAN THAT ONE GROUP IS GIVEN MORE THAN
ANOTHER EVEN THOUGH BOTH PERFORM THE SAME FUNCTION
A: Yes, there is discrimination. The principle equal pay for equal work should
apply in this case. Persons who work with substantially equal qualifications,
skill, effort and responsibility, under similar conditions, should be paid similar
salaries. If an employee is paid less it is upon the employer to explain why the
employee is treated differently. Dislocation and limited tenure cannot serve as
adequate or valid bases for the difference in the salary rates. The other
benefits are enough to make up for these two factors. There is no reasonable
distinction between the work of a local-hire and a foreign-hire that will justify
the difference.
(Intl School Alliance of Educators vs Quisumbing - 06/01/00)
ART. 101. Payment by results. - (a) The Secretary of Labor and Employment
shall regulate the payment of wages by results, including pakyao, piecework,
and other non-time work, in order to ensure the payment of fair and
reasonable wage rates, preferably through time and motion studies or in
consultation with representatives of workers and employers organizations.
FACILITIES shall include all articles or services for the benefit of the
employee or his family but shall not include tools of the trade or articles or
services primarily for the benefit of the employer or necessary to the conduct of
the employers business. These are DEDUCTIBLE from wages.
(Sec. 5, Rule VII, Book III, IRR)
1. Proof must be shown that such facilities are customarily furnished by the trade
2. The provision of deductible facilities must be voluntarily accepted in writing by
the employee
3. Facilities must be charged at fair and reasonable value
(Mabeza vs NLRC, GR# 118506 04/18/97)
- Cebu Autobus Co. vs United Cebu Autobus Employees Assoc. (GR# 9742
10/27/55)
Considering therefore that hotel workers are required to work different shifts and
are expected to be available at various odd hours, their ready availability is a
necessary matter in the operations of a small hotel such as petitioners business.
The deduction of the cost of meals from respondents wages, therefore, should be
removed.
(Mayon Hotel & Restaurant vs Adana, GR# 157634 05/16/05)
ART. 122. Labor Code. Creation of Regional Tripartite Wages and Productivity
Boards. - There is hereby created Regional Tripartite Wages and Productivity
Boards, hereinafter referred to as Regional Boards, in all regions, including
autonomous regions as may be established by law. The Commission shall
determine the offices/headquarters of the respective Regional Boards.
The Regional Boards shall have the following powers and functions in their
respective territorial jurisdictions:
(Composition)
Each Regional Board shall be composed of the Regional Director of the
Department of Labor and Employment as chairman, the Regional Directors
of the National Economic and Development Authority and the Department
of Trade and Industry as vice-chairmen and two (2) members each from
workers and employers sectors who shall be appointed by the President of
the Philippines, upon the recommendation of the Secretary of Labor and
Employment, to be made on the basis of the list of nominees submitted by the
workers and employers sectors, respectively, and who shall serve for a term of
five (5) years.
Within 30 days after the conclusion of the last hearing, the RTWPB shall
decide on the merits of the petition, and where appropriate, issue a wage
order establishing the regional minimum wage rates to be paid by employers,
which shall in no case be lower than the applicable statutory minimum wage
rates. The Wage Order may include wages by industry, province or locality as
may be deemed necessary by the Board.
The RTWPB shall furnish the NWPC a copy of the decision on the petition or
the Wage Order.
Any Wage Order issued by the RTWPB may not be disturbed for a
period of 12 months from its Effectivity, and no petition for wage increase
shall be entertained within said period.
Except:
Supervening conditions (i.e., increase in price of gas, basic commodities,
etc.)
Congress itself issues a law increasing wages.
The Wage Order shall take effect 15 days after its publication in at
least 1 newspaper of general circulation in the Region.
The RTWPB shall prepare, for approval of the Sec. of Labor, upon
recommendation of the Commissioner, the necessary Implementing Rules and
Regulations, not later than 10 days from the issuance of the Wage Order.
The Sec. of Labor shall act on the Rules within 20 days from his receipt
thereof.
Once approve, it shall be published in at least 1 newspaper of general
circulation.
The NWPC may review the Wage Order upon APPEAL or MOTO
PROPRIO.
Grounds for filing an appeal:
a) Non-conformity with prescribed guidelines and/or procedure
b) Questions of law
c) Grave abuse of discretion
(Rule V, Revised Rules of Procedure on Minimum Wage Fixing 11/29/95)
An appeal will not stay the order unless the appellant files adequate
surety.
Art. 124 Standards/Criteria for minimum wage fixing. - The regional minimum
wages to be established by the Regional Board shall be as nearly adequate as is
economically feasible to maintain the minimum standards of living necessary for
the health, efficiency and general well-being of the employees within the
framework of the national economic and social development program. In the
determination of such regional minimum wages, the Regional Board shall, among
other relevant factors, consider the following:
The wages prescribed in accordance with the provisions of this Title shall be the
standard prevailing minimum wages in every region. These wages shall include
wages varying with industries, provinces or localities if in the judgment of the
Regional Board, conditions make such local differentiation proper and necessary
to effectuate the purpose of this Title.
Where the application of any prescribed wage increase by virtue of a law or wage
order issued by any Regional Board results in distortions of the wage structure
within an establishment, the employer and the union shall negotiate to correct
the distortions. Any dispute arising from wage distortions shall be resolved
through the grievance procedure under their collective bargaining agreement
and, if it remains unresolved, through voluntary arbitration. Unless otherwise
agreed by the parties in writing, such dispute shall be decided by the voluntary
arbitrators within ten (10) calendar days from the time said dispute was referred
to voluntary arbitration.
In cases where there are no collective agreements or recognized labor unions, the
employers and workers shall endeavor to correct such distortions. Any dispute
arising therefrom shall be settled through the National Conciliation and Mediation
Board and, if it remains unresolved after ten (10) calendar days of conciliation,
shall be referred to the appropriate branch of the National Labor Relations
Commission (NLRC). It shall be mandatory for the NLRC to conduct continuous
hearings and decide the dispute within twenty (20) calendar days from the time
said dispute is submitted for compulsory arbitration.
The pendency of a dispute arising from a wage distortion shall not in any way
delay the applicability of any increase in prescribed wage rates pursuant to the
provisions of law or wage order.
All workers paid by result, including those who are paid on piecework, takay,
pakyaw or task basis, shall receive not less than the prescribed wage rates per
eight (8) hours of work a day, or a proportion thereof for working less than eight
(8) hours.
ART. 123. Wage Order. - Whenever conditions in the region so warrant, the
Regional Board shall investigate and study all pertinent facts; and based on the
standards and criteria herein prescribed, shall proceed to determine whether a
Wage Order should be issued. Any such Wage Order shall take effect after fifteen
(15) days from its complete publication in at least one (1) newspaper of general
circulation in the region.
Any party aggrieved by the Wage Order issued by the Regional Board may appeal
such order to the Commission within ten (10) calendar days from the publication
of such order. It shall be mandatory for the Commission to decide such appeal
within sixty (60) calendar days from the filing thereof.
The filing of the appeal does not stay the order unless the person appealing such
order shall file with the Commission, an undertaking with a surety or sureties
satisfactory to the Commission for the payment to the employees affected by the
order of the corresponding increase, in the event such order is affirmed. (As
amended by Republic Act No. 6727, June 9, 1989).
A Wage Order shall take effect fifteen (15) days after its publication in at least 1
newspaper of general circulation in the Region.
4. Wage Distortion
Definition
ART. 124 Labor Code - Where the application of any prescribed wage increase
by virtue of a law or wage order issued by any Regional Board results in
distortions of the wage structure within an establishment, the employer and the
union shall negotiate to correct the distortions. Any dispute arising from wage
distortions shall be resolved through the grievance procedure under their
collective bargaining agreement and, if it remains unresolved, through voluntary
arbitration. Unless otherwise agreed by the parties in writing, such dispute shall
be decided by the voluntary arbitrators within ten (10) calendar days from the
time said dispute was referred to voluntary arbitration.
Wage Distortions. Where the application of any wage increase resulting from a
Wage Order issued by any Board results in distortions in the wage structure
within an establishment, the employer and the union shall negotiate to correct
the distortions using the grievance procedure under the collective bargaining
agreement. If it remains unresolved, it shall be decided through voluntary
arbitration within ten calendar days from the time the dispute was referred for
voluntary arbitration, unless otherwise agreed by the parties in writing.
The pendency of a dispute arising from a wage distortion shall not in any way
delay the applicability of any wage increase prescribed pursuant to the provisions
of law or Wage Order.
In the present case, it is clear that no wage distortion resulted when respondent
implemented the subject Wage Orders in the covered branches. In the said
branches, there was an increase in the salary rates of all pay classes.
Furthermore, the hierarchy of positions based on skills, length of service, and
other logical bases of differentiation was preserved. In other words, the
quantitative difference in compensation between different pay classes remained
the same in all branches in the affected region.
A wage disparity between employees in different rungs is not at issue here, but
a wage disparity between employees in the same rung but located in different
regions of the country. Contrary to petitioners postulation, a disparity in wages
between employees holding similar positions but in different regions does not
constitute wage distortion as contemplated by law. As previously enunciated, it
is the hierarchy of positions and the disparity of their corresponding wages and
other emoluments that are sought to be preserved by the concept of wage
distortion. Put differently, a wage distortion arises when a wage order
engenders wage parity between employees in different rungs of the
organizational ladder of the same establishment. It bears emphasis that wage
distortion involves a parity in the salary rates of different pay classes which, as
a result, eliminates the distinction between the different ranks in the same
region.
(Prubankers Assoc. vs Prudential Bank, 01/25/99)
The mere factual existence of wage distortion does not, however, ipso facto
result in an obligation to rectify it, absent a law or other source of obligation
which requires its rectification. Unlike in Metro Transit(case) where there
existed a "company practice", no such management practice is herein alleged
to obligate Bankard to provide an across-the-board increase to all its regular
employees.
(Bankard Employees Union vs NLRC, GR# 140689 02/17/04)
The fact that the re-establishment was the result of collective bargaining
negotiations, instead of through a special grievance procedure, is not sufficient
legal basis for rejecting such re-establishment.
(P.I. Mfg. Inc. vs PIMSFA, GR# 167217 02/04/08)
Workers already being paid more than the existing minimum wage (up to a
certain amount stated in the Wage Order) are also to be given a wage increase.
The Court said that there are 2 ways to fix minimum wage:
1. The "floor-wage" method, which involves the fixing of a determinate
amount to be added to the prevailing statutory minimum wage rates, and
2. The "salary-ceiling" method, where the wage adjustment was to be
applied to employees receiving a certain denominated salary ceiling.
In line with its declared policy, R.A. 6727 created the NWPC, vested with the
power to prescribe rules and guidelines for the determination of appropriate
minimum wage and productivity measures at the Regional, Provincial, or
Industry levels; and authorized the RTWPB to determine and fix the minimum
wage rates applicable in their respective Regions, Province, or Industries therein
and issue the corresponding Wage Orders, subject to the guidelines issued by
the NWPC.
The RTWPB, pursuant to its wage fixing authority, may issue Wage Orders which
set the daily minimum wage rates, based on the standards of criteria set by Art.
124 of the Labor Code.
(Metrobank Inc. vs NWPC, GR# 144322 02/06/07)
- Norkis Free & Independent Workers Union vs Norkis Trading Co. (GR#
157098 06/30/05)
Notably, the RTWPB was interpreting only its own issuance, not a statutory
provision. The best authority to construe a rule or an issuance is the very
source, in this case the RTWPB. Without a doubt, the RTWPB, like any other
executive agency, has the authority to interpret its own rules and issuances;
any phrase contained in its interpretation becomes a part of those rules or
issuances themselves.
Therefore, it was proper for the CA to consider the letter written by the RTWPB
to explain the scope and import of the latters own Order, as such interpretation
is deemed part of the Order itself.
Application of Title. - This Title shall not apply to farm tenancy or leasehold,
domestic service and persons working in their respective homes in needle work or
in any cottage industry duly registered in accordance with law.
Exceptions:
1. Farm tenancy or leasehold
2. Household or domestic helpers
3. Homeworkers engaged in needlework
4. Workers employed in any establishment duly registered with the
National Cottage Industry Development Authority (NCIDA)
5. Workers in duly registered cooperatives when so recommended by the
Bureau of Cooperative Development upon approval by the Sec. of Labor.
(Art. 98 Labor Code)
6. Workers of a Barangay Micro Business Enterprise (R.A. 9178
11/13/02)
7. Retail/Service establishments with less than ten (10) workers upon
application with the appropriate Regional Board. (Sec. 4, R.A. 6727)
RULE I
GENERAL PROVISIONS
Section 3. Scope. This Rules shall govern proceedings in the National Wages
and Productivity Commission and the Regional Tripartite Wages and
Productivity Boards in the fixing of minimum wage rates.
Section 4. Definition of Terms. As used in this Rules:
k) "Regional Minimum Wage Rates" refer to the lowest basic wage rates that an
employer can pay his workers, as fixed by the Board which shall not be lower than
the applicable statutory minimum wage rates;
n) "Wage Order" refers to the Order promulgated by the Board pursuant to its
wage
fixing authority.
RULE II
2) BOARD ACTION.
If the petition conforms with the requirements prescribed in the preceding
sub-section b.1., the Board shall conduct public hearings in the manner
prescribed under this Rule and Rule III, to determine whether a wage order
should be issued. The Board may also conduct consultations with concerned
sectors/industries.
3) PUBLICATION OF NOTICE OF PETITION/PUBLIC HEARING.
A notice of the petition and/or public hearing shall be published in a
newspaper of general circulation in the region and/or posted in public places
as determined by the Board. The notice shall include the name/s and
address/es of the petitioner/s, the subject of the petition and the date/s,
place/s and time of the hearings. The publication or posting shall be made at
least fifteen (15) days before the date of initial hearing and shall be in
accordance with the suggested form attached as Annex "A".
4) OPPOSITION.
Any party may file his opposition to the petition on or before the initial
hearing, copy furnished the petitioner/s. The opposition shall be filed with the
appropriate Board in ten (10) typewritten legible copies which shall contain
the following:
(a) name/s and address/es of the oppositor/s and signature/s of
authorized official/s;
(b) reasons or grounds for the opposition; and
(c) relief sought.
5) CONSOLIDATION OF PETITIONS.
If there is more than one petition filed, the Board may, motu proprio or on
motion of any party, consolidate these for purposes of conducting joint
hearings or proceedings to expedite resolutions of petitions. Petitions received
after publication of an earlier petition need not go through the
publication/posting requirement.
6) ASSISTANCE OF OTHER GOVERNMENT AND PRIVATE
ORGANIZATIONS.
The Board may enlist the assistance and cooperation of any government
agency or private person or organization to furnish information in aid of its
wage fixing function.
RULE III
CONDUCT OF HEARINGS
Section 1. Public Hearings. Prior to the issuance of a wage order, public
hearings shall be conducted giving notices to employees' and employers'
groups, provincial, city and municipal officials and other interested parties.
Section 2. Who May Conduct. Hearings may be conducted by the Board en
banc or by a duly authorized committee thereof wherein each sector shall be
represented. The presence of the Regional Chairman or any of the Vice
Chairmen shall be required. If unable to attend, Board Members may send
observers. The Board shall determine the date/s, place/s, and time of the
hearings which shall open to the public except as otherwise requested by a
party and so determined by the Board.
Section 3. Order of Hearing. As much as practicable, the petitioner/s shall
present his/their evidence first, followed by the oppositor/s. The Board may
then call on other persons to present their views and submit position papers
and other supporting documents.
Section 4. Manner and Duration of Hearings. Public hearings shall be
conducted in a manner that shall ensure that all sectors and parties who stand
to be directly affected by the decisions and orders of the Board are given the
widest opportunity to be heard. Pursuant to this, the hearings shall be
conducted in each province in the region as far as practicable.
Hearings shall be conducted within forty five (45) days from the date of initial
hearing except when conditions in the region warrant otherwise.
Section 5. Records of Proceedings. The Board Secretariat shall keep
records/minutes of all Board proceedings, duly noted by the Members of the
Board.
Section 6. Non-applicability of Technical Rules. The Board shall not be bound
strictly by technical rules evidence and procedures.
Section 7. Prohibition Against Injunction. No preliminary or permanent
injunction or temporary restraining order may be issued by any court, tribunal
or any other entity against any proceeding before the Commission or Board.
RULE IV
WAGE ORDER
Section 1. Issuance of Wage Order. Within thirty (30) days after conclusion of
the last hearing, the Board shall decide on the merits of the petition, and
where appropriate, issue a wage order establishing the regional minimum
wage rates to be paid by employers which shall in no case be lower than the
applicable statutory minimum wage rates. The Wage Order may include
wages by industry, province or locality as may be deemed necessary by the
Board provided, however, that such wage rates shall not be lower than the
regional minimum wage rates unless expressly specified in the Wage Order.
The Board shall furnish the Commission a copy of the decision on the petition
or the Wage Order.
Section 2. Contents of Wage Order. A Wage Order shall specify the region,
province, or industry to which the minimum wage rates prescribed under the
Order shall apply and provide exemptions, if any, subject to guidelines issued
by the Commission.
Section 3. Frequency of Wage Order. Any Wage Order issued by the Board
may not be disturbed for a period of twelve (12) months from its effectivity,
and no petition for wage increase shall be entertained within the said period.
In the event, however, that supervening conditions, such as extraordinary
increase in prices of petroleum products and basic goods/services, demand a
review of the minimum wage rates as determined by the Board and confirmed
by the Commission, the Board shall proceed to exercise its wage fixing
function even before the expiration of the said period.
Section 4. Effectivity. A Wage Order shall take effect fifteen (15) days after
its publication in at least one (1) newspaper of general circulation in the
region.
Section 5. Implementing Rules/ Regulations. The Board shall prepare, for
approval of the Secretary of Labor and Employment upon recommendation of
the Commission, the necessary Implementing Rules and Regulations not later
than ten (10) days from the issuance of a Wage Order.
The Secretary of Labor and Employment shall act on the Implementing Rules
within a period of twenty (20) days from receipt of the said Implementing
Rules by the Commission. Once approved, the Board shall cause the
publication of the Implementing Rules and Regulations in at least one (1)
newspaper of general circulation in the region.
Section 6. Review of Wage Order. The Commission may review the Wage
Order issued by the Board motu propio or upon appeal.
Section 7. Correction of Error. The Board may, motu propio or upon
manifestation of any party, proceed to correct any patent error, errors in
computation or typographical errors in any Wage Order.
Section 8. Amendments to Wage Order. In case of substantive changes in
the Wage Order, the Board must comply with the required procedures
provided under Section 1 of Rule II and Section 4 of Rule IV.
RULE V
APPEAL
Section 1. Appeal to the Commission. Any party aggrieved by a Wage Order
issued by the Board may appeal such Order to the Commission by filing a
verified appeal with the Board in three (3) typewritten legible copies, not later
than ten (10) days from the date of publication of the Order. The appeal shall
be accompanied by a memorandum of appeal which shall state the grounds
relied upon and the arguments in support of the appeal.
The Board shall serve notice of the appeal to concerned parties.
Failure to file an appeal within the reglementary period fixed under this
section or to submit the required documents shall be a ground for dismissal of
the appeal.
Section 2. Grounds for Appeal. An appeal may be filed on the following
grounds:
(a) non-conformity with prescribed guidelines and/or
procedures;
RULE VI
QUORUM
Section 1. Quorum. Four (4) members of the Commission or Board shall
constitute a quorum to transact business, provided that the Chairman or the
Vice Chairman is present and each sector is represented. The Commission or
Board may dispense with the proviso requiring sectoral representation if the
two (2) representatives of any sector fail to attend, without justifiable reason,
two (2) consecutive scheduled meetings with proper notice.
Section 2. Votes Required. Any decision of the Commission or Board shall
require the affirmative of not less than four (4) of its members.
RULE VII
WAGE DISTORTION
Section 1. Correction of Wage Distortion. Where the application of any
prescribed wage increase by virtue of a Wage Order issued by the Board
results in distortions of the wage structure within an establishment, the
employer and the union shall negotiate to correct the distortions. Any dispute
arising from wage distortions shall be resolved through the grievance
procedure under their collective bargaining agreement and, if it remains
unresolved, through voluntary arbitration. Unless otherwise agreed by the
parties in writing, such dispute shall be decided by the voluntary arbitrator or
panel of voluntary arbitrators within ten (10) days from the time said dispute
was referred to voluntary arbitration.
In cases where there are no collective agreements or recognized labor unions,
the employers and workers shall endeavor to correct such distortions. Any
dispute arising therefrom shall be settled through the National Conciliation
and Mediation Board and, if it remains unresolved after ten (10) days of
conciliation, shall be referred to the appropriate branch of the National Labor
Relations Commission (NLRC). It shall be mandatory for the NLRC to conduct
continuous hearings and decide the dispute within twenty (20) days from the
time said dispute is submitted for compulsory arbitration.
The pendency of a dispute arising from a wage distortion shall not in any way
delay the applicability of any increase in prescribed wage rates pursuant to
the provisions of the Wage Order.
RULE VIII
EXEMPTIONS
Section 1. Application for Exemption. Whenever a wage order provides for
exemption, applications for exemption shall be filed with the appropriate
Board which shall process these applications, subject to guidelines issued by
the Commission.
RULE IX
ENFORCEMENT
Section 1. Enforcement of Wage Orders. Compliance with the Wage Order
issued by the Board shall be enforced by the appropriate Regional Office of
the Department of Labor and Employment in accordance with enforcement
procedures under Articles 128 and 129 of the Labor Code as amended.
NWPC Guidelines No. 01 Series of 1996
1. Distressed establishments
2. New business enterprises (NBEs)
3. Retail/Service establishments employing not more than ten (10)
workers
4. Establishments adversely affected by natural calamities
A. Distressed Establishments
For Stock Corporations/Cooperatives
When deficit as of the last full accounting period or interim period, if
any, immediately preceding the effectivity of the Order amounts to 20% or
more of the paid-up capital for the same period; or
When an establishment registers capital deficiency i.e., negative
stockholders' equity as of the last full accounting period or interim period,
if any, immediately preceding the effectivity of the Order.
Non-stock non-profit organizations operating for less than two (2) years
may be granted exemption when the net accumulated losses for the
period immediately preceding the effectivity of the Order amounts to 20%
or more of the fund balance/members' contribution at the beginning of
the period under review.
Under controllership/conservatorship
A bank or quasi-bank under controllership/conservatorship may
apply for exemption as a distressed establishment under Section 3 A of
this Guidelines.
The Board may require the submission of other pertinent documents to support the
application for exemption.
c) Questions of law.
I. Opposition - The appellee may file with the Board his
reply or opposition to the appeal within ten (10) days from
receipt of the appeal. Failure of the appellee to file his reply or
opposition shall be construed as waiver on his part to file the
same.
II. Transmittal of records - Within five (5) days upon receipt
of the reply or opposition of the appellee or after the expiration
of the period to file the same, the entire records of the case
which shall be consecutively numbered, shall be transmitted by
the Board to the Commission.
Q: What is the difference between the exemptions under the labor code and those
under the NWPC Guidelines?
A: Under the NWPC Guidelines, the establishment must APPLY for an exemption (Sec.
2(par. 2) NWPC Guidelines), whereas those under the Labor Code, the establishment
NEED NOT APPLY.
Under the spirit of Wage Order No. 6, it is the actual ability of a firm to spend for
its current needs and costs and not how the assets and liabilities of a firm may
appear in the technical jargon of Higher Accounting Principles which is
important.
Sec. 8(a) of the Rules Implementing Wage Order No. NCR-03 provides that
exemption from compliance with the wage increase may be granted to
distressed establishments.
"Distressed Establishments" are those whose paid-up capital has been impaired
by at least 25% or which registers capital deficiency or negative net worth.
2. Wages
Form of Payment
Payment of wages by check or money order shall be allowed when such manner
of payment is customary on the date of effectivity of this Code, or is necessary
because of special circumstances as specified in appropriate regulations to be
issued by the Secretary of Labor and Employment or as stipulated in a collective
bargaining agreement.
- Art. 1705 (CC). The laborer's wages shall be paid in legal currency.
The same penalties shall be imposed upon any person who shall pay the wages
due a laborer or employee employed by him, by means of tokens or objects
other than the legal tender currency of the laborer or employee.
ATM Guidelines
- Labor Advisory Nov. 25, 1996
SO, the following conditions must concur for the valid payment of wages thru
banks:
1. upon written permission of the majority of the employees or workers
concerned;
2. all private establishments, companies, businesses, and other entities
with at least 25 or more employees;
3. located within 1 kilometer radius to a commercial, savings or rural
banks shall pay wages or benefits of their employees through any of the
banks;
4. within the period of payment of wages fixed by PD 442, the Labor
Code, as amended;
Place of Payment
ART. 104. Labor Code. Place of payment. - Payment of wages shall be made at
or near the place of undertaking, except as otherwise provided by such
regulations as the Secretary of Labor and Employment may prescribe under
conditions to ensure greater protection of wages.
EXCEPTIONS: (Sec. 4, Rule VII, Book III, IRR)
Time of Payment
ART. 103. Labor Code. Time of payment. - Wages shall be paid at least once
every two (2) weeks or twice a month at intervals not exceeding sixteen (16)
days. If on account of force majeure or circumstances beyond the employers
control, payment of wages on or within the time herein provided cannot be made,
the employer shall pay the wages immediately after such force majeure or
circumstances have ceased. No employer shall make payment with less
frequency than once a month.
1. That payments are made at intervals not exceeding sixteen (16) days,
in proportion to the amount of work completed;
Whom to Pay?
ART. 105. Labor Code. Direct payment of wages. - Wages shall be paid directly
to the workers to whom they are due, except:
(a) In cases of force majeure rendering such payment impossible or under other
special circumstances to be determined by the Secretary of Labor and
Employment in appropriate regulations, in which case, the worker may be paid
through another person under written authority given by the worker for the
purpose; or
(b) Where the worker has died, in which case, the employer may pay the wages
of the deceased worker to the heirs of the latter without the necessity of intestate
proceedings. The claimants, if they are all of age, shall execute an affidavit
attesting to their relationship to the deceased and the fact that they are his heirs,
to the exclusion of all other persons. If any of the heirs is a minor, the affidavit
shall be executed on his behalf by his natural guardian or next-of-kin. The
affidavit shall be presented to the employer who shall make payment through the
Secretary of Labor and Employment or his representative. The representative of
the Secretary of Labor and Employment shall act as referee in dividing the
amount paid among the heirs. The payment of wages under this Article shall
absolve the employer of any further liability with respect to the amount paid.
General Rule: Wages shall be made direct to the employee to whom they are
due
Exceptions:
When must it be Gen. Rule Once every 2 weeks, or twice a month, but not
Paid? beyond 16 days per payment.
Valid Deductions
ART. 113. Labor Code. Wage deduction. - No employer, in his own behalf or in
behalf of any person, shall make any deduction from the wages of his employees,
except:
a. In cases where the worker is insured with his consent by the employer, and
the deduction is to recompense the employer for the amount paid by him as
premium on the insurance;
b. For union dues, in cases where the right of the worker or his union to check-off
has been recognized by the employer or authorized in writing by the
individual worker concerned; and
a. When the deductions are authorized by law, including deductions for the
insurance premiums advanced by the employer in behalf of the employee as
well as union dues where the right to check-off has been recognized by the
employer or authorized in writing by the individual employee himself.
b. When the deductions are with the written authorization of the employees for
payment to the third person and the employer agrees to do so; Provided, That
the latter does not receive any pecuniary benefit, directly or indirectly, from
the transaction.
GENERAL RULE:
EXEMPTIONS:
GENERAL RULE: No employer shall limit or otherwise interfere with the freedom
of any employee to dispose of his wages. He shall not in any manner force,
compel, or oblige his employees to purchase merchandise, commodities, or
other property from the employer or from any other person, or otherwise make
use of any services of such employer or any other person.
EXEMPTIONS:
ART. 116. Labor Code. Withholding of wages and kickbacks prohibited. - It shall
be unlawful for any person, directly or indirectly, to withhold any amount from the
wages of a worker or induce him to give up any part of his wages by force,
stealth, intimidation, threat or by any other means whatsoever without the
workers consent.
ART. 114. Labor Code. Deposits for loss or damage. - No employer shall require
his worker to make deposits from which deductions shall be made for the
reimbursement of loss of or damage to tools, materials, or equipment supplied by
the employer, EXCEPT when the employer is engaged in such trades,
occupations or business where the practice of making deductions or requiring
deposits is a recognized one, or is necessary or desirable as determined by the
Secretary of Labor and Employment in appropriate rules and regulations.
Allowances
Tips
- DEFINITION; NATURE
It has been said that a TIP denotes a voluntary act, but it has also been said
that from the very beginning of the practice of tipping it was evident that,
whether considered from the standpoint of the giver or the recipient, a TIP
lacked the essential element of a gift, namely, the free bestowing of a gratuity
without consideration, and that, despite its apparent voluntariness, there is an
element of compulsion in TIPPING.
Although a customer may give a TIP as a consideration for services rendered, its
value still depends on the giver, and it is given in addition to the compensation
by the employer; A gratuity given by an employer in order to inspire the
employee to exert more effort in his work is more appropriately called a bonus.
NOTE:
Tips come from the customers, not the Employer, hence they are generally not
demandable.
Bonus
- DEFINTION; NATURE
- IS A BONUS DEMANDABLE?
All given, business losses are a feeble ground for petitioner to repudiate its
obligation under the CBA. The rule is settled that any benefit and supplement
being enjoyed by the employees cannot be reduced, diminished, discontinued
or eliminated by the employer. The principle of non-diminution of benefits is
founded on the constitutional mandate to protect the rights of workers and to
promote their welfare and to afford labor full protection. Hence, absent any
proof that the employers consent was vitiated by fraud, mistake or duress, it is
presumed that it entered into the CBA voluntarily and had full knowledge of the
contents thereof and was aware of its commitments under the contract.
(Lepanto Ceramics Inc. vs Lepanto Ceramics Employees Assoc., GR# 03/02/10)
GENERAL RULE:
A BONUS is not a demandable and enforceable obligation.
EXCEPTION:
When it is made part of the wage or salary or compensation.
When considered as part of the compensation and therefore
demandable and enforceable, the amount is usually fixed.
- WAIVER OF BENEFITS
Going now to the question of whether respondents members individual
acceptance of the award and the resulting payments made by petitioner
operate as a ratification of the DOLE Secretarys award which renders CA-G.R.
SP No. 72965 moot, we find that such do not operate as a ratification of the
DOLE Secretarys award; nor a waiver of their right to receive further benefits,
or what they may be entitled to under the law. The appellate court correctly
ruled that the respondents members were merely constrained to accept
payment at the time. Christmas was then just around the corner, and the union
members were in no position to resist the temptation to accept much-needed
cash for use during the most auspicious occasion of the year. Time and again,
we have held that necessitous men are not, truly speaking, free men; but to
answer a present emergency, will submit to any terms that the crafty may
impose upon them.
(UST vs SM UST, GR# 169940 09/14/09)
Chapter VI
ADMINISTRATION AND ENFORCEMENT
(b) Notwithstanding the provisions of Articles 129 and 217 of this Code to the
contrary, and in cases where the relationship of employer-employee still exists,
the Secretary of Labor and Employment or his duly authorized representatives
shall have the power to issue compliance orders to give effect to the labor
standards provisions of this Code and other labor legislation based on the findings
of labor employment and enforcement officers or industrial safety engineers
made in the course of inspection. The Secretary or his duly authorized
representatives shall issue writs of execution to the appropriate authority for the
enforcement of their orders, except in cases where the employer contests the
findings of the labor employment and enforcement officer and raises issues
supported by documentary proofs which were not considered in the course of
inspection. (As amended by Republic Act No. 7730, June 2, 1994).
(d) The Secretary of Labor and Employment may likewise order stoppage of work
or suspension of operations of any unit or department of an establishment when
non-compliance with the law or implementing rules and regulations poses grave
and imminent danger to the health and safety of workers in the workplace. Within
twenty-four hours, a hearing shall be conducted to determine whether an order
for the stoppage of work or suspension of operations shall be lifted or not. In case
the violation is attributable to the fault of the employer, he shall pay the
employees concerned their salaries or wages during the period of such stoppage
of work or suspension of operation.
(e) It shall be unlawful for any person or entity to obstruct, impede, delay or
otherwise render ineffective the orders of the Secretary of Labor and Employment
or his duly authorized representatives issued pursuant to the authority granted
under this Article, and no inferior court or entity shall issue temporary or
permanent injunction or restraining order or otherwise assume jurisdiction over
any case involving the enforcement orders issued in accordance with this Article.
(f) Any government employee found guilty of violation of, or abuse of authority,
under this Article shall, after appropriate administrative investigation, be subject
to summary dismissal from the service.
ART. 129. Recovery of wages, simple money claims and other benefits. - Upon
complaint of any interested party, the Regional Director of the Department of Labor
and Employment or any of the duly authorized hearing officers of the Department is
empowered, through summary proceeding and after due notice, to hear and decide
any matter involving the recovery of wages and other monetary claims and benefits,
including legal interest, owing to an employee or person employed in domestic or
household service or househelper under this Code, arising from employer-employee
relations: Provided, That such complaint does not include a claim for reinstatement:
Provided further, That the aggregate money claims of each employee or househelper
does not exceed Five thousand pesos (P5,000.00). The Regional Director or hearing
officer shall decide or resolve the complaint within thirty (30) calendar days from the
date of the filing of the same. Any sum thus recovered on behalf of any employee or
househelper pursuant to this Article shall be held in a special deposit account by, and
shall be paid on order of, the Secretary of Labor and Employment or the Regional
Director directly to the employee or househelper concerned. Any such sum not paid
to the employee or househelper because he cannot be located after diligent and
reasonable effort to locate him within a period of three (3) years, shall be held as a
special fund of the Department of Labor and Employment to be used exclusively for
the amelioration and benefit of workers.
Any decision or resolution of the Regional Director or hearing officer pursuant to this
provision may be appealed on the same grounds provided in Article 223 of this Code,
within five (5) calendar days from receipt of a copy of said decision or resolution, to
the National Labor Relations Commission which shall resolve the appeal within ten
(10) calendar days from the submission of the last pleading required or allowed
under its rules.
The Secretary of Labor and Employment or his duly authorized representative may
supervise the payment of unpaid wages and other monetary claims and benefits,
including legal interest, found owing to any employee or househelper under this
Code. (As amended by Section 2, Republic Act No. 6715, March 21, 1989).
NOTES:
Visitorial Power power of the Secretary of Labor or any of his duly authorized
representative to have access to employers records and premises at any time of the
day or night whenever work is being undertaken therein.
It includes the right to enjoy to copy therefrom, to question any employee and
investigate any fact, condition or matter which may aid in the enforcement of the
Code and of any labor law, wage order, or rules and regulations.
Procedure
ACTUAL INSPECTION
In case of non-compliance
HEARING
DECISION
MR APPEAL
(8-10 days with Secretary of Labor)
WORK STOPPAGE
Instances when enforcement power may not be used:
Case does not arise from the exercise of Visitorial power;
When employer-employee relationship ceased to exist at the time of the
inspection; and
If employer contests the finding of the Labor Regulation Officer and such
contestable issue is not verifiable in the normal course of inspection.
Article 129. Recovery of wages, simple money claims and other benefits.
Adjudicatory power:
The Regional Director or any of his duly authorized hearing officer is empowered
through summary proceeding and after due notice, to hear and decide cases
involving recovery of wages and other monetary claims and benefits, including legal
interests.
SUMMARY ON JURISDICTION:
Can be delegated:
Under Sec. 2(e) D.O. No. 57-04 the DOLE may delegate to local government units the
conduct of technical safety inspection required under Art. 165 of the Labor Code.
Comprises:
Self-assessment is a voluntary compliance mode applicable to and encouraged in
establishments with at least 200 workers and, regardless of number of workers, to
unionized firms with CBAs.
Advisory services provide services to establishment with less than 10 workers and
those registered as BMBEs (barangay micro-business enterprises). These small
businesses are given assistance to improve their productivity, thereby facilitating
their eventual compliance with labor standards.
In the case at bar, the Secretary of Labor correctly assumed jurisdiction over the
case as it does not come under the exception clause in Art. 128(b) of the Labor
Code. While petitioner Jethro appealed the inspection results and there is a need to
examine evidentiary matters to resolve the issues raised, the payrolls presented by
it were considered in the ordinary course of inspection. While the employment
records of the employees could not be expected to be found in Yakults premises in
Calamba, as Jethros offices are in Quezon City, the records show that Jethro was
given ample opportunity to present its payrolls and other pertinent documents
during the hearings and to rectify the violations noted during the ocular inspection.
It, however, failed to do so, more particularly to submit competent proof that it was
giving its security guards the wages and benefits mandated by law.
Jethros failure to keep payrolls and daily time records in Yakults premises was not
the only labor standard violation found to have been committed by it; it likewise
failed to register as a service contractor with the DOLE, pursuant to Department
Order No. 18-02 and, as earlier stated, to pay the wages and benefits in accordance
with the rates prescribed by law.
The DOLE in the exercise of its visitorial and enforcement power somehow has to
make a determination of the existence of an employer-employee relationship. Such
prerogatival determination, however, cannot be coextensive with the visitorial and
enforcement power itself. Indeed, such determination is merely preliminary,
incidental and collateral to the DOLEs primary function of enforcing labor
standards provisions. The determination of the existence of employer-employee
relationship is still primarily lodged with the NLRC. This is the meaning of the clause
in cases where the relationship of employer-employee still exists in Art. 128 (b).
Thus, before the DOLE may exercise its powers under Article 128, two important
questions must be resolved: (1) Does the employer-employee relationship still
exist, or alternatively, was there ever an employer-employee relationship to speak
of; and (2) Are there violations of the Labor Code or of any labor law? The
existence of an employer-employee relationship is a statutory prerequisite to and a
limitation on the power of the Secretary of Labor, one which the legislative branch
is entitled to impose.
Since Dusit Hotel is explicitly mandated by the Article 96 of the Labor Code to pay
its employees and management their respective shares in the service charges
collected, the hotel cannot claim that payment thereof to its 82 employees
constitute substantial compliance with the payment of ECOLA under WO No. 9.
Undoubtedly, the hotel employees right to their shares in the service charges
collected by Dusit Hotel is distinct and separate from their right to ECOLA;
gratification by the hotel of one does not result in the satisfaction of the other.
R. CLASSIFICATION OF EMPLOYEES
1. Regular vs Casual Employees
ART. 280. Labor Code. Regular and casual employment. - The provisions of written
agreement to the contrary notwithstanding and regardless of the oral agreement of
the parties, an employment shall be deemed to be regular where the employee has
been engaged to perform activities which are usually necessary or desirable in the
usual business or trade of the employer, except where the employment has been
fixed for a specific project or undertaking the completion or termination of which has
been determined at the time of the engagement of the employee or where the work
or service to be performed is seasonal in nature and the employment is for the
duration of the season.
(2) those who have rendered at least one year of service, whether
continuous or broken, with respect to the activity in which they are employed.
(regular employees by years of service)
The former (1) refers to those employees who perform a particular activity which is
necessary or desirable in the usual business or trade of the employer, regardless of
their length of service;
While the latter (2) refers to those employees who have been performing the job,
regardless of the nature thereof, for at least a year.
If the employee has been performing the job for at least one year, even if the
performance is not continuous or merely intermittent, the law deems the repeated
and continuing need for its performance as sufficient evidence of the necessity, if
not indispensability, of that activity to the business.
The Labor Code provides that a casual employee can be considered as a regular
employee if said casual employee has rendered at least one year of service
regardless of the fact that such service may be continuous or broken. Section 3,
Rule V, Book II of the Implementing Rules and Regulations of the Labor Code clearly
defines the term at least one year of service to mean service within 12 months,
whether continuous or broken, reckoned from the date the employee started
working, including authorized absences and paid regular holidays, unless the
working days in the establishment, as a matter of practice or policy, or as provided
in the employment contract, is less than 12 months, in which case said period shall
be considered one year. If the employee has been performing the job for at least
one year, even if the performance is not continuous or merely intermittent, the law
deems the repeated and continuing need for its performance as sufficient evidence
of the necessity, if not indispensability, of that activity to the business of the
employer.
If the employee has been performing the job for at least one year, even if the
performance is not continuous or merely intermittent, the law deems the repeated
and continuing need for its performance as sufficient evidence of the necessity, if
not indispensability of that activity to the business.
The Court ruled that once a project or work pool employee has been:
1. Continuously re-hired by the same employer for the same tasks or nature of
tasks; and
2. These tasks are vital, necessary and indispensable to the usual business or trade
of the employer
Considering the submission of the parties, we are constrained to agree with the
unanimous ruling of the Court of Appeals, NLRC and Labor Arbiter that respondents
are petitioners regular employees. Respondents were employed for more than one
year and their work as carpenters was necessary or desirable in petitioners usual
trade or business of manufacturing office furniture. Under Article 280 of the Labor
Code, the applicable test to determine whether an employment should be
considered regular or non-regular is the reasonable connection between the
particular activity performed by the employee in relation to the usual business or
trade of the employer.
We also agree that Eutiquio was not an independent contractor for he does not
carry a distinct and independent business, and he does not possess substantial
capital or investment in tools, equipment, machinery or work premises. He works
within petitioners premises using the latters tools and materials, as admitted by
petitioner. Eutiquio is also under petitioners control and supervision. Attesting to
this is petitioners admission that it allowed respondents to use its facilities for the
proper implementation of job orders. Moreover, the Implementing Guidelines
regulating attendance, overtime, deadlines, penalties; providing petitioners right
to fire employees or contractors; requiring the carpentry division to join
petitioners exercise program; and providing rules on machine maintenance, all
reflect control and supervision over respondents.
The "control test" assumes primacy in the overall consideration. Under this test, an
employment relation obtains where work is performed of services are rendered
under the control and supervision of the party contracting for the service, not only
as to the result of the work but also as to the manner and details of the
performance desired.
2. Seasonal
The fact that respondents do not work continuously for 1 whole year but only for
the duration of the season does not detract from considering them in regular
employment since this Court has already settled that seasonal workers who are
called to work from time to time and are temporarily laid off during off-season are
not separated from service in said period, but merely considered on leave until-
reopened.
3. Project
GENERAL RULE:
Employment for at least 1 year, whether continuous or broken renders an
employee as REGULAR.
EXCEPTION:
When the employment is for a SPECIFIC PROJECT or UNDERTAKING.
EXCEPTION TO EXCEPTION:
Where from the circumstances it is apparent that periods have been
imposed to preclude the acquisition of tenurial security by the employee.
If after the project, the employer fails to submit the required Statistical
Report to the DOLE at the end of the project, the employees therein may be
The Court cannot countenance the employees claim that a contract of perpetual
employment was ever constituted. While the Constitution recognizes the primacy of
labor, it also recognizes the critical role of private enterprise in nation-building and
the prerogatives of management. A contract of perpetual employment deprives
management of its prerogative to decide whom to hire, fire and promote, and
renders inutile the basic precepts of labor relations. While management may validly
waive it prerogatives, such waiver should not be contrary to law, public order,
public policy, morals or good customs. An absolute and unqualified employment for
life in the mold of petitioners concept of perpetual employment is contrary to
public policy and good customs, as it unjustly forbids the employer from
terminating the services of an employee despite the existence of a just or valid
cause. It likewise compels the employer to retain an employee despite the
attainment of the statutory retirement age, even if the employee has became a
non-performing asset or, worse, a liability to the employer.
The re-hiring of petitioners on a project-to-project basis did not confer upon them
regular employment status. The practice was dictated by the practical
consideration that experienced construction workers are more preferred. It did not
change their status as project employees.
Project employees who work under different project employment contracts for
several years do not automatically become regular employees. Employees who are
members of a "work pool" from which a company draws workers for deployment to
its different projects do not become regular employees by reason of that fact alone.
Where from the circumstances it is apparent that periods have been imposed to
preclude the acquisition of tenurial security by the employee, they should be struck
down as contrary to public policy, morals, good customs, or public order.
As observed by the Solicitor General, the record of this case discloses, as part of
petitioners position paper, a certification duly issued by private respondent on a
continuing basis since 1965. The certification indubitably indicates that after a
particular project has been accomplished, petitioner would be re-hired immediately
the following day, save for a gap of 1 day to 1 week from the last project to the
succeeding one. There can, therefore, be no escape from the conclusion that
petitioner is a regular employee of private respondent.
The presumption is that when the work done is an integral part of the regular
business of the employer and when the worker, relative to the employer, does not
furnish an independent business or professional service, such work is a regular
employment of such employee and not an independent contractor.
While length of time may not be a sole controlling test for project employment, it
can be a strong factor to determine whether the employee was hired for a specific
undertaking or in fact tasked to perform functions which are vital, necessary and
indispensable to the usual trade or business of the employer.
The acid test in considering fixed-term contracts as valid is; if from the
circumstances it is apparent that periods have been imposed to preclude
acquisition of tenurial security by the employee, they should be disregarded for
being contrary to public policy.
A project is a job or undertaking which is distinct, separate and identifiable from the
undertakings of the company, and a project employee is assigned to a project
which begins and ends at determined or determinable times.
Absent any evidence to the contrary, good faith must be presumed in this case.
Entries in the payroll, being entries in the course of business, enjoy the
presumption of regularity under Sec. 43, Rule 130. Hence, while as a general rule,
the burden of proving payment of monetary claims rests on the employer, when
fraud is alleged in the preparation of the payroll, the burden of evidence shifts to
the employee and it is incumbent upon him to adduce clear and convincing
evidence in support of his claim. Unfortunately, petitioners bare assertions of fraud
do not suffice to overcome the disputable presumption of regularity.
4. Piece Rate
While petitioners mode of compensation was on a "per piece" basis, the status and
nature of their employment was that of regular employees.
As to the other benefits, namely, holiday pay, premium pay, 13th month pay, and
service incentive leave which the Labor Arbiter failed to rule on but which
petitioners prayed for in their complaint, we hold that petitioners are so entitled to
these benefits.
Three (3) factors lead us to conclude that petitioners, although piece rate workers,
were regular employees of private respondents.
1. Those whose time and performance are supervised by the employer. (Here, there
is an element of control and supervision over the manner as to how the work is to
be performed. A piece-rate worker belongs to this category especially if he
performs his work in the company premises.)
2. Those whose time and performance are unsupervised. (Here, the employers
control is over the result of the work. Workers on pakyao and takay basis belong to
this group.)
Both classes of workers are paid per unit accomplished. In this case, petitioners
belong to the first category.
NOTES:
The decisive determinant in term employment should not be the activities that the
employee is called upon to perform, BUT the day certain agreed upon by he
parties for the commencement and termination of their employment relationship, a
day certain being understood to be that which must necessarily come, although it
may not be known when. The term period was further defined to be the length of
existence; duration (Phil. Village Hotel vs. NLRC, 230 SCRA 423)
GENERAL RULE:
Fixed term employment is valid
EXCEPTION:
When such agreement is entered into to circumvent the security of tenure. [that is,
repetitive hiring with proof of circumvention of the law; contract is void, hence
employee is regular]
5. Probationary
(b) Where the work is neither learnable nor apprenticeable, the probationary
employment period shall not exceed six (6) months reckoned from the date the
employee actually started working.
(c) The services of an employee who has been engaged on probationary basis may
be terminated only for a just cause or when authorized by existing laws, or when he
fails to qualify as a regular employee in accordance with reasonable standards
prescribed by the employer.
(d) In all cases involving employees engaged on probationary basis, the employer
shall make known to the employee the standards under which he will qualify as a
regular employee at the time of his engagement.
ART. 73. Labor Code. Learners defined. - Learners are persons hired as trainees in
semi-skilled and other industrial occupations which are non-apprenticeable and which
may be learned through practical training on the job in a relatively short period of
time which shall not exceed three (3) months.
GENERAL RULE:
Probationary Period shall not Exceed 6 months.
EXCEPTIONS:
Apprenticeship - Not more than 6 months (Sec. 19, Rule II, Book VI, IRR)
Learners - Not more than 3 months (Art. 73, Labor Code)
It is settled that while probationary employees do not enjoy permanent status, they
are entitled to the constitutional protection of security of tenure. Their employment
may only be terminated for just cause or when they fail to qualify as regular
employees in accordance with reasonable standards made known to them by their
employer at the time of engagement, and after due process.
Applying Art. 13 of the Civil Code, the probationary period of 6 months consists of
180 days. This is in conformity with par. 1 of Art. 13 of the Civil Code, which
provides that the months which are not designated by their names shall be
understood as consisting of 30 days each.
Under Art. 282 of the Labor Code, an unsatisfactory rating can be a just cause for
dismissal only if it amounts to gross and habitual neglect of duties. Gross
negligence has been defined to be the want or absence of even slight care or
diligence as to amount to reckless disregard of the safety of person or property. It
evinces a thoughtless disregard of consequences without exerting any effort to
avoid them. In this case, there is no such evidence of gross negligence on the part
of Private Respondent.
(Mistubishi Motors vs Chrysler Phils. Labor Union, GR# 148738 06/29/04)
NOTE:
In Mariwasa Manufacturing, Inc. vs. Leogardo (G.R. No 74246 01/26/89), the
Supreme Court stated that the extension of the probationary period was ex gratia,
an act of liberality on the part of the employer affording the employee a second
chance to make good after having initially failed to prove his worth as an employee.
Such an act cannot unjustly be turned against said employers account to compel it
to keep on its payroll one who could not perform according to its work standards.
By voluntarily agreeing to an extension of the probationary period, the employee in
effect waived any benefit attaching to the completion of said period if he still failed
to make the grade during the period of extension.
In termination cases, the burden of proving just or valid cause for dismissing an
employee rests on the employer.
(Dusit Hotel Nikko vs Gatbonton, GR# 161654 05/05/06)
If the school were to apply the probationary standards (as in fact it says it did in the
present case), these standards must not only be reasonable but must have also
been communicated to the teachers at the start of the probationary period, or at
the very least, at the start of the period of application of the said standards. These
terms, in addition to those expressly provided by the Labor Code, would serve as
the just cause for the termination of the probationary contract. As explained
above, the details of this finding of just cause must be communicated to the
affected teachers as a matter of due process.
AMACC, by its submissions, admits that it did not renew the petitioners contracts
because they failed to pass the Performance Appraisal System for Teachers (PAST)
and other requirements for regularization that the school implements to maintain
its high academic standards. The evidence is unclear on the exact terms of the
standards, although the school also admits that these were standards under the
Guidelines on the Implementation of AMACC Faculty Plantilla put in place at the
start of school year 2000-2001.
While the Court can grant that the standards were duly communicated to the
petitioners and could be applied beginning the 1st trimester of the school year
2000-2001, glaring and very basic gaps in the schools evidence still exist. The
exact terms of the standards were never introduced as evidence; neither does the
evidence show how these standards were applied to the petitioners. Without these
pieces of evidence (effectively, the finding of just cause for the non-renewal of the
petitioners contracts), the Court has nothing to consider and pass upon as valid or
invalid for each of the petitioners. Inevitably, the non-renewal (or effectively, the
termination of employment of employees on probationary status) lacks the
supporting finding of just cause that the law requires and, hence, is illegal.
S. HOURS OF WORK
SUMMARY:
The Labor Code allows not more than 8 hrs work per day, and not more than 6 days
per week, subject to certain exemptions.
ART. 83. Labor Code. Normal hours of work. - The normal hours of work of any
employee shall not exceed eight (8) hours a day.
Health personnel in cities and municipalities with a population of at least one million
(1,000,000) or in hospitals and clinics with a bed capacity of at least one hundred
(100) shall hold regular office hours for eight (8) hours a day, for five (5) days a week,
exclusive of time for meals, except where the exigencies of the service require that
such personnel work for six (6) days or forty-eight (48) hours, in which case, they
shall be entitled to an additional compensation of at least thirty percent (30%) of
their regular wage for work on the sixth day. For purposes of this Article, "health
personnel" shall include resident physicians, nurses, nutritionists, dietitians,
pharmacists, social workers, laboratory technicians, paramedical technicians,
psychologists, midwives, attendants and all other hospital or clinic personnel.
ART. 84. Labor Code. Hours worked. - Hours worked shall include:
a. all time during which an employee is required to be on duty or to be at a
prescribed workplace; and
b. all time during which an employee is suffered or permitted to work.
Rest periods of short duration during working hours shall be counted as hours
worked.
NOTE:
Part-time workers are allowed because the Labor Code prescribes 8 hrs as the
MAXIMUM not the MINIMUM.
The age-old rule governing the relation between labor and capital, or management
and employee, of a "Fair Day's Wage for a Fair Day's Labor" remains as the basic
factor in determining employees wages. If there is no work performed by the
employee, there can be no wage or pay - unless, of course, the laborer was able,
willing, and ready to work but was illegally locked out, suspended, or dismissed, or
otherwise illegally prevented from working. Such situation is not present here, so
respondent should be exempted from the burden of paying backwages.
(Navarro vs P.V. Pajarillo Liner Inc., GR# 164681 04/24/09)
2. Rest Period
3. Meal Break
ART. 85. Labor Code. Meal periods. - Subject to such regulations as the Secretary
of Labor may prescribe, it shall be the duty of every employer to give his employees
not less than sixty (60) minutes time-off for their regular meals.
(a) Where the work is non-manual work in nature or does not involve strenuous
physical exertion;
(b) Where the establishment regularly operates not less than sixteen (16) hours a
day;
(c) In case of actual or impending emergencies or there is urgent work to be
performed on machineries, equipment or installations to avoid serious loss which
the employer would otherwise suffer; and
(d) Where the work is necessary to prevent serious loss of perishable goods.
The eight-hour work period does not include the meal break. Nowhere in the law
may it be inferred that employees must take their meals within the company
premises. Employees are not prohibited from going out of the premises as long as
they return to their posts on time. Private respondents act, therefore, of going
home to take his dinner does not constitute abandonment.
ART. 91. Labor Code. Right to weekly rest day. - (a) It shall be the duty of every
employer, whether operating for profit or not, to provide each of his employees a rest
period of not less than twenty-four (24) consecutive hours after every six (6)
consecutive normal work days.
(b) The employer shall determine and schedule the weekly rest day of his employees
subject to collective bargaining agreement and to such rules and regulations as the
Secretary of Labor and Employment may provide. However, the employer shall
respect the preference of employees as to their weekly rest day when such
preference is based on religious grounds.
NOTE:
5. Overtime Pay
ART. 87. Labor Code. Overtime work. - Work may be performed beyond eight (8)
hours a day provided that the employee is paid for the overtime work, an additional
compensation equivalent to his regular wage plus at least twenty-five percent (25%)
thereof. Work performed beyond eight hours on a holiday or rest day shall be paid an
additional compensation equivalent to the rate of the first eight hours on a holiday or
rest day plus at least thirty percent (30%) thereof.
ART. 88. Labor Code. Undertime not offset by overtime. - Undertime work on any
particular day shall not be offset by overtime work on any other day. Permission
given to the employee to go on leave on some other day of the week shall not
exempt the employer from paying the additional compensation required in this
Chapter.
ART. 93. Labor Code. Compensation for rest day, Sunday or holiday work.
(a) Where an employee is made or permitted to work on his scheduled rest day, he
shall be paid an additional compensation of at least thirty percent (30%) of his
regular wage. An employee shall be entitled to such additional compensation for
work performed on Sunday only when it is his established rest day.
(b) When the nature of the work of the employee is such that he has no regular
workdays and no regular rest days can be scheduled, he shall be paid an additional
compensation of at least thirty percent (30%) of his regular wage for work performed
on Sundays and holidays.
(c) Work performed on any special holiday shall be paid an additional compensation
of at least thirty percent (30%) of the regular wage of the employee. Where such
holiday work falls on the employees scheduled rest day, he shall be entitled to an
additional compensation of at least fifty per cent (50%) of his regular wage.
SECTION 9. Premium and overtime pay for holiday and rest day work.
(a) Except employees referred to under Section 2 of this Rule, an employee who is
permitted or suffered to work on special holidays or on his designated rest days not
falling on regular holidays, shall be paid with an additional compensation as premium
pay of not less than thirty percent (30%) of his regular wage. For work performed in
excess of eight (8) hours on special holidays and rest days not falling on regular
holidays, an employee shall be paid an additional compensation for the overtime
work equivalent to his rate for the first eight hours on a special holiday or rest day
plus at least thirty percent (30%) thereof.
(c) The payment of additional compensation for work performed on regular holidays
shall be governed by Rule IV, Book Three, of these Rules.
GENERAL RULE:
Employees Cannot be COMPELLED to render Overtime Work.
EXCEPTIONS:
ART. 92. Labor Code. When employer may require work on a rest day. - The
employer may require his employees to work on any day: EMAPIS
e. Where the nature of the work requires continuous operations and the
stoppage of work may result in Irreparable injury or loss to the employer; and
In cases not falling within any of these enumerated in this Section, no employee
may be made to work beyond eight hours a day against his will.
6. Premium Pay
Refers to additional compensation for work performed within eight (8) hours on non-
work days, such as rest days, special days, holidays, etc.
Rate is 200% of the regular rate if Rate is 130% of regular rate if worked.
worked.
Premium Pay on Sundays and Holidays Entitled to 130% of the daily rate for
when Employee has no Regular worked performed on Sundays and
Workdays and No Scheduled Regular holidays
Rest Day
Premium Pay for work performed on Entitled to 150% of the daily rate
Special Holidays (now Special Days)
which fall on an Employees Scheduled
Rest Day
Premium Pay for work performed Entitled to 130% of the daily rate
during Special Day
Premium Pay for work performed on a Entitled to 230% of the daily rate
Regular Holiday falling on a scheduled
Rest Day.
7. Holiday Pay
Definition
Eleven(12) Regular Holidays and Two (3) Special Days under R.A.
9849 (12/11/09)
Sec. 26. Regular Holidays and Nationwide Special Days (1) Unless otherwise
modified by law, order or proclamation, the following regular holidays and special
days shall observed in the country.
REGULAR HOLIDAYS
Art. 94 of the Labor Code affords a worker the enjoyment of 10 paid regular
holidays. The provision is mandatory, regardless of whether an employee is paid
on a monthly or daily basis. Unlike a bonus, which is a management
prerogative, holiday pay is a statutory benefit demandable under the law. Since
a worker is entitled to the enjoyment of 10 paid regular holidays, the fact that 2
holidays fall on the same date should not operate to reduce to 9 the 10 holiday
pay benefits a worker is entitled to receive.
Sec. 11, Rule IV, Book III of the IRR provides that "Nothing in the law or the rules
shall justify an employer in withdrawing or reducing any benefits, supplements
or payments for unworked regular holidays as provided in existing individual or
collective agreement or employer practice or policy.
Muslim holidays are provided under Art. 169 and 170, Title I, Book V, of P.D.
1083, otherwise known as the Code of Muslim Personal Laws.
P.D. 1083 provides that "the provisions of this Code shall be applicable only to
Muslims". However, there should be no distinction between Muslims and Non-
Muslims as regards payment of benefits for Muslims holidays. The CA did not err
in sustaining Undersecretary Espanol who stated: "Assuming arguendo that the
respondents position is correct, then by the same token, Muslims throughout
the Philippines are also not entitled to holiday pays on Christian holidays
declared by law as regular holidays." We must remind the respondent-appellant
that wages and other emoluments granted by law to the working man are
determined on the basis of the criteria laid down by laws and certainly not on
the basis of the workers faith or religion. At any rate, Art. 3(3) of P.D. 1083 also
declares that "nothing herein shall be construed to operate to the prejudice of a
non-Muslim."
Art. 95(a) of the Labor Code governs the award of service incentive leave. It
provides that every employee who has rendered at least one year of service shall
be entitled to a yearly service incentive leave of 5 days with pay, and Sec. 3, Rule
V, Book III, IRR, defines the term "at least 1 year f service" to mean service within
12 months, whether continuous or broken reckoned from the date the employee
started working, including authorized absences and paid regular holidays, unless
the working days in the establishment as a matter of practice or policy, or that
provided in the employment contract is less than 12 months, in which case said
period shall be considered as 1 year.
Accordingly, private respondents service incentive leave credits of 5 days for every
year of service, based on the actual service rendered to the petitioner, in
accordance with each contract of employment should be computed up to the date
of reinstatement pursuant to Art. 279 of the Labor Code.
In the case of service incentive leave, the employee may choose to either use his
leave credits or commute it to its monetary equivalent if not exhausted at the end
of the year. Furthermore, if the employee entitled to service incentive leave does
not use or commute the same, he is entitled upon his resignation or separation
from work to the commutation of his accrued service incentive leave.
The clear policy of the Labor Code is to grant service incentive leave pay to workers
in all establishments, subject to a few exceptions. Sec. 2, Rule V, Book III, IRR
provides that "every employee who has rendered at least 1 year of service shall be
entitled to a yearly service incentive leave of 5 days with pay".
Service incentive leave is a right which accrues to every employee who has served
"within 12 months, whether continuous or broken reckoned from the date the
employee started working, including authorized absences and paid regular holidays
unless the working days in the establishment as a matter of practice or policy, or
that provided in the employment contracts is less than 12 months, in which case
said period shall be considered as 1 year".
Applying Art. 291 of the Labor Code in light of this peculiarity of the service
incentive leave, we can conclude that the 3-year prescriptive period commences,
not at the end of the year when the employee becomes entitled to the
commutation of his service incentive leave, but from the time when the employer
refuses to pay its monetary equivalent after demand of commutation or upon
termination of the employee's services, as the case may be.
JPL cannot escape the payment of 13th month pay and service incentive leave
pay to private respondents. Said benefits are mandated by law and should be
given to employees as a matter of right. P.D. 851 as amended, requires an
employer to pay its rank and file employees a 13th month pay not later than
December 24 of every year.
However, employers not paying their employees a 13th month pay or its
equivalent are not covered by said law. The term "its equivalent" was defined
by the law's implementing guidelines as including Christmas Bonus, Mid-Year
Bonus, Cash Bonuses, and other payment amounting to not less than 1/2 of the
basic salary but shall not include cash and stock dividends, cost-of-living
allowances and all other allowances regularly enjoyed by the employee, as well
as non-monetary benefits.
The difference between the minimum wage and the actual salary received by
the employees cannot be deemed as their 13th Month Pay and Service Incentive
Leave Pay as such difference is not equivalent to or of the same import as the
said benefits contemplated by law.
While computation for the 13th Month Pay should properly begin from the first
day of employment, the Service Incentive Leave Pay should start a year after
commencement of service, for it is only then that the employee is entitled to
said benefit.
P.D. 851 mandates that all employers must pay all their employees receiving a
basic salary of not more than P1,000 per month, regardless of the nature of the
employment, a 13th month pay not later than December 24 of every year.
Memorandum Order No. 28, dated August 18, 1986, removed the salary ceiling,
generally making all employees entitled to 13th month pay regardless of the
amount of their basic salary, designation, or employment status, and
irrespective of the method by which their wages are paid, provided that they
have worked for at least 1 month during the calendar year.
P.D. 851, as amended, does not admit of certain exceptions or exclusions from
its coverage, among which is Sec. 3(c). Employers already paying their
employees 13th month pay or more in a calendar year or its equivalent at the
time of this issuance.
11.Service Charges
12.Exemptions
Art. 82 of the Labor Code exempts MANAGERIAL EMPLOYEES from the coverage of
Labor Standards. Labor Standards provide the working conditions of employees,
including entitlement to overtime pay and premium pay for working on rest days.
Under this provision, managerial employees are "those whose primary duty consists
of the management of the establishment in which they are employed or of a
particular department or subdivision."
The Implementing Rules of the Labor Code state that managerial employees are
those who meet the following conditions:
2. They customarily and regularly direct the work of two or more employees
therein;
3. They have the authority to hire or fire other employees of lower rank; or their
suggestions and recommendations as to the hiring and firing and as to the
promotion or any other change of status of other employees are given
particular weight.
The Court disagrees with the NLRC's finding that petitioner was a managerial
employee. However, petitioner was a member of the Managerial Staff, which also
takes him out of the coverage of Labor Standards. Like Managerial Employees,
Officers, and Members of the Managerial Staff are not entitled to the provisions of
Labor Standards Law.
JOB CONTRACTING
There is contracting or subcontracting when an employer, referred to as the principal,
farms out the performance of a part of its business to another, referred to as the
contractor or subcontractor. For the purpose of undertaking the principal's business that
is farmed out, the contractor or subcontractor then employs its own employees.
Contracting and subcontracting are synonymous under Philippine labor law. The term
that is more commonly used is subcontracting.
If the four-fold test is satisfied not by the subcontractor but by the principal, the principal
then becomes the employer of the employees engaged to accomplish the job or service.
What exists is not subcontracting but a direct employer-employee relationship between
the principal and the employees.
3. The agreement between the principal and contractor or subcontractor assures the
contractual employees to entitlement to all labor and occupational safety standards,
free exercise of the right to self-organization, security of tenure, and social and
welfare benefits.
LABOR-ONLY CONTRACTING
It is a prohibited practice
The contractor is merely an agent of the employer. The principal and contractor will
be solidarily treated as the employer.
The principals liability is comprehensive. The liability pertains not only to unpaid
wages but extends to any and all liability under the Labor laws.
The employer is deemed to have directly hired the contractual employees and is
therefore liable for any and all violations of the Labor Code.
a. The subcontractor will be treated as the agent of the principal. Since the act
of an agent is the act of the principal, representations made by the subcontractor to
the employees will bind the principal.
b. The principal will become the employer as if it directly employed the workers
engaged to undertake the subcontracted job or service. It will be responsible to them
for all their entitlements and benefits under the labor laws.
c. The principal and the subcontractor will be solidarily treated as the
employer.
d. The employees will become employees of the principal, subject to the
classifications of employees under Article 28 of the Labor Code.
The contractual employee shall be entitled to all the rights and privileges due a regular
employee as provided for in the Labor Code, as amended, to include the following:
Individuals with special skills, expertise or talent enjoy the freedom to offer their
services as independent contractors. The right to life and livelihood guarantees this
freedom to contract as independent contractors. The right of labor to security of tenure
cannot operate to deprive an individual to contract as an independent contractor.
Are those who exercise independent employment, contracting to do a piece of work
according to their own methods and without being subjected to the control of their
employer except as to the result of their work.
In the event that the contractor or subcontractor fails to pay the wages of his
employees in accordance with this Code, the employer shall be jointly and severally
liable with his contractor or subcontractor to such employees to the extent of the
work performed under the contract, in the same manner and extent that he is liable
to employees directly employed by him.
The foregoing provisions shall be without prejudice to the application of Art. 248(c) of
the Labor Code, as amended.
The right to control shall refer to the right reserved to the person for whom the
services of the contractual workers are performed, to determine not only the end to
be achieved, but also the manner and means to be used in reaching that end.
SEC. 6 Prohibitions. Not withstanding Sec. 5 of these Rules, the following are
hereby declared prohibited for being contrary to law or public policy:
a. Contracting out of a job, work, or service when not done in good faith and not
justified by the exigencies of the business and the same results in the termination
of regular employees and reduction of work hours or reduction or splitting of the
bargaining unit;
b. Contracting out of work with a cabo as defined in Sec. 1(ii), Rule I, Book V of
these Rules. Cabo refers to a person or group of persons or to a labor group
which, in the guise of a labor organization, supplies workers to an employer, with
or without any monetary or other consideration whether in the capacity of an
agent of the employer or as an ostensible independent contractor;
c. Taking undue advantage of the economic situation or lack of bargaining strength
of the contractual employee, or undermining his security of tenure or basic rights,
or circumventing the provisions of regular employment, in any of the following
instances:
d. Contracting out of a job, work, or service through an in-house agency which refers
to a contractor or subcontractor engaged in the supply of labor which is owned,
managed, or controlled by the principal and which operates solely for the
principal;
e. Contracting out of a job, work, or service directly related to the business or
operation of the principal by reason of a strike or lockout whether actual or
imminent;
f. Contracting out of a job, work, or service being performed by union members
when such will interfere with, restrain, or coerce employees in the exercise of
their rights to self-organization as provided in Art. 248(c) of the Labor Code as
amended.
ART. 248 (C). Labor Code. Unfair labor practices of employers. - It shall be
unlawful for an employer to commit any of the following unfair labor practice:
(c) To contract out services or functions being performed by union members when
such will interfere with, restrain or coerce employees in the exercise of their rights to
self-organization;
By virtue of the power vested in the Secretary of Labor and Employment under
Articles 5 (Rule-making) and 106 (Contractor or Subcontractor) of the Labor Code
of the Philippines, as amended, the following regulations governing contracting
and subcontracting arrangements are hereby issued:
Section 2 . Coverage. - These Rules shall apply to all parties of contracting and
subcontracting arrangements where employer-employee relationship exists.
Placement activities through private recruitment and placement agencies as
governed by Articles 25 to 39 of the Labor Code are not covered by these Rules.
The "right to control" shall refer to the right reserved to the person for whom the
services of the contractual workers are performed, to determine not only the end
to be achieved, but also the manner and means to be used in reaching that end.
(a) Contracting out of a job, work or service when not done in good faith
and not justified by the exigencies of the business and the same results in the
termination of regular employees and reduction of work hours or reduction or
splitting of the bargaining unit;
(b) Contracting out of work with a "cabo" as defined in Section 1 (ii), Rule
I, Book V of these Rules. "Cabo" refers to a person or group of persons or to a
labor group which, in the guise of a labor organization, supplies workers to an
employer, with or without any monetary or other consideration whether in the
capacity of an agent of the employer or as an ostensible independent
contractor;
(c) Taking undue advantage of the economic situation or lack of
bargaining strength of the contractual employee, or undermining his security
of tenure or basic rights, or circumventing the provisions of regular
employment, in any of the following instances:
The principal shall be deemed the employer of the contractual employee in any of
the following cases as declared by a competent authority:
Where the termination results from the expiration of the contract between the
principal and the contractor or subcontractor, or from the completion of the phase
of the job, work or service for which the contractual employee is engaged, the
latter shall not be entitled to separation pay. However, this shall be without
prejudice to completion bonuses or other emoluments, including retirement pay
as may be provided by law or in the contract between the principal and the
contractor or subcontractor.
Failure to register shall give rise to the presumption that the contractor is
engaged in labor-only contracting. (Since it is only a presumption, it can still be
rebutted by substantial evidence.)
(a) The name and business address of the applicant and the area or areas
where it seeks to operate;
(b) The names and addresses of officers, if the applicant is a corporation,
partnership, cooperative or union;
(c) The nature of the applicant's business and the industry or industries
where the applicant seeks to operate;
(d) The number of regular workers; the list of clients, if any; the number of
personnel assigned to each client, if any and the services provided to the
client;
(e) The description of the phases of the contract and the number of
employees covered in each phase, where appropriate; and
(f) A copy of audited financial statements if the applicant is a corporation,
partnership, cooperative or a union, or copy of the latest ITR if the applicant is
a sole proprietorship.
The application shall be verified and shall include an undertaking that the
contractor or subcontractor shall abide by all applicable labor laws and
regulations.
Section 13. Filing and processing of applications. - The application and its
supporting documents shall be filed in triplicate in the Regional Offices where the
applicant principally operates. No application for registration shall be accepted
unless all the foregoing requirements are complied with. The contractor or
subcontractor shall be deemed registered upon payment of a registration fee of
P100.00 to the Regional Office.
Where all the supporting documents have been submitted, the Regional Office
shall deny or approve the application within seven (7) working days after its filing.
Upon registration, the Regional Office shall return one set of the duly-stamped
application documents to the applicant, retain one set for its file, and transmit the
remaining set to the Bureau of Local Employment. The Bureau shall devise the
necessary forms for the expeditious processing of all applications for registration.
Section 14. Duty to produce copy of contract between the principal and
the contractor or subcontractor. - The principal or the contractor or
subcontractor shall be under an obligation to produce a copy of the contract
between the principal and the contractor in the ordinary course of inspection. The
contractor shall likewise be under an obligation to produce a copy of the contract
of employment of the contractual worker when directed to do so by the Regional
Director or his authorized representative.
A copy of the contract between the contractual employee and the contractor or
subcontractor shall be furnished the certified bargaining agent, if there is any.
(a) A list of contracts entered with the principal during the subject
reporting period;
(b) The number of workers covered by each contract with the principal;
(c) A sworn undertaking that the benefits from the Social Security System
(SSS), the Home Development Mutual Fund (HDMF), PhilHealth, Employees
Compensation Commission (ECC), and remittances to the Bureau of Internal
Revenue (BIR) due its contractual employees have been made during the
subject reporting period.
The Regional Office shall return one set of the duly-stamped report to the
contractor or subcontractor, retain one set for its file, and transmit the remaining
set to the Bureau of Local Employment within five (5) days from receipt thereof.
Based on the visitorial and enforcement power of the Secretary of Labor and
Employment in Article 128 (a), (b), (c) and (d), the Regional Director shall issue
compliance orders to give effect to the labor standards provisions of the Labor
Code, other labor legislation and these guidelines.
Section 19. Solidary liability. - The principal shall be deemed as the direct
employer of the contractual employees and therefore, solidarily liable with the
contractor or subcontractor for whatever monetary claims the contractual
employees may have against the former in the case of violations as provided for
in Sections 5 (Labor-Only contracting), 6 (Prohibitions), 8 (Rights of Contractual
Employees) and 16 (Delisting) of these Rules. In addition, the principal shall also
be solidarily liable in case the contract between the principal and contractor or
subcontractor is pre-terminated for reasons not attributable to the fault of the
contractor or subcontractor.
Section 20. Supersession. - All rules and regulations issued by the Secretary of
Labor and Employment inconsistent with the provisions of this Rule are hereby
superseded. Contracting or subcontracting arrangements in the construction
industry, under the licensing coverage of the PCAB and shall not include
shipbuilding and ship repairing works, however, shall continue to be governed by
Department Order No. 19, series of 1993.
Section 21. Effectivity. - This Order shall be effective fifteen (15) days after
completion of its publication in two (2) newspapers of general circulation.
In plainer terms, the contracted personnel (acting as sales route helpers) were
only engaged in the marginal work of helping in the sale and distribution of
company products; they only provided the muscle work that sale and
distribution required and were thus necessarily under the companys control
and supervision in doing these tasks.
Still another way of putting it is that the contractors were not independently
selling and distributing company products, using their own equipment, means
and methods of selling and distribution; they only supplied the manpower that
helped the company in the handing of products for sale and distribution. In the
context of D.O. 18-02, the contracting for sale and distribution as an
independent and self-contained operation is a legitimate contract, but the pure
supply of manpower with the task of assisting in sales and distribution
controlled by a principal falls within prohibited labor-only contracting.
(Coca-Cola Bottlers vs Dela Cruz, GR# 184977 12/07/09)
Under this scheme, the "labor-only" contractor is the agent of the principal. The
law makes the principal responsible to the employees of the "labor-only"
contractor as if the principal itself directly hired or employed the employees.
(Iligan Cement Corp. vs IEWU-SPFL, GR# 158956 04/24/09)
RELEVANT CASES:
The principal and the contractor are jointly and severally liable to the employees for
their wages.
The right of the contractor to recover from the principal arises only if he has paid
the amounts for which both of them are jointly and severally liable in-line with Art.
1217 of the Civil Code.
(Lapanday vs CA, 01/31/00)
He who made the payment may claim from his co-debtors only the
share which corresponds to each, with the interest for the payment
already made. If the payment is made before the debt is due, no
interest for the intervening period may be demanded.
The security guard's immediate recourse for the payment of the increase of their
minimum wage is with their direct employer while the latter can claim
reimbursement from the principal.
For the security guards, the actual source of the payment of their wage differentials
and premium for holiday and rest day work does not matter as long as they are
paid. Solidary liability does not mean that, as between themselves, two solidary
debtors are liable for only half of the payment.
(Eparwa Security & Janitorial Services Inc. vs Liceo De Cagayan Univ., GR# 150402
11/28/06)
U. PREFERENCE OF WAGES
Preferential right of workers and employees under Art. 110 of the Labor Code may
be invoked only during bankruptcy or liquidation proceedings. The article
establishes only a preference of credit, not a lien.
The preference of credits does not create a charge of proprietary interest upon the
property of the debtor.
(DBP vs Sec. of Labor, GR# 79351 11/28/89)
Art. 110 of the Labor Code should be applied in conjunction with the pertinent
provisions of the Civil Code and the Insolvency Law to the extent that piece-meal
distribution of the assets of the debtor is avoided.
The amendment of Art. 110 expanded the concept of worker preference to cover
not only unpaid wages but also other monetary claims to which even claims by the
Government must be deemed subordinate.
(DBP vs NLRC, GR# 108031 03/01/95)
A non-lawyer may appear before the Commission or any Labor Arbiter only if:
Any change in the address of counsel/representative should be filed with the records of
the case and furnished the adverse party or counsel.
GENERAL RULE:
Only lawyers can appear before the NLRC or a Labor Arbiter.
EXCEPTIONS:
Non-lawyers may appear before the NLRC or a Labor Aribiter:
1. If they represent themselves;
2. If they represent their organization or members thereof; or
3. If he is duly accredited member of the legal aid office of any college of law, school or
university duly recognized by the DOJ in cases referred thereto by the latter or by the
IBP; he or she must be a 4th year student of any college of law, school or university
and must be currently enrolled
1. Apprentices
(a) To help meet the needs or demands of the economy for trained manpower in
the widest possible range of employment;
Qualifications of an Apprentice:
1. at least 15 years of age; [provided that those who are at least 15 years of
age but less than eighteen may be eligible for apprenticeship only in non-
hazardous occupations and the apprenticeship agreement shall be signed in his
behalf by the parent or guardian or authorized representative of DOLE]
2. possess vocational aptitude and capacity for appropriate tests; and
3. possess the ability to comprehend and follow oral and written instructions
4. The company must have an apprenticeship program duly approved by the
DOLE.
Trade and industry associations may, recommend to the Secretary of Labor and
Employment appropriate educational qualifications for apprentices in certain
occupations. Such qualifications, if approved, shall be the educational requirements
for apprenticeship in such occupations unless waived by an employer in favor of an
applicant who has demonstrated exceptional ability.
APPEAL (Art.66,LC)
Secretary of DOLE
[Sec of DOLEs decision is final & executory]
APPRENTICESHIP LEARNERSHIP
DURATION
Not less than 3 months practical training Practical training on the job not to
on the job but not more than 6months exceed 3 months.
CONCEPT
Practical training on the job Hiring of persons as trainees in semi-
supplemented by related theoretical skilled and other industrial occupations
instruction which are non-apprenticeable and
which may be learned through practical
training on the job in a relatively short
period of time.
EMPLOYERS COMMITMENT TO HIRE
No commitment to hire With a commitment to employ the
learner as regular employee if he
desires upon completion of learnership
EFFECT OF PRETERMINATION
Worker is not considered an employee Learner is considered regular employee
after 2 months of training and dismissal
is without fault of learner
FOCUS OF TRAINING
Highly skilled or technical industries & in Semi-skilled/industrial occupation (non-
industrial occupation apprenticeable)
APPROVAL
Requires DOLE approval for validity Not required
EXHAUSTION OF ADM. REMEDIES IN CASE OF BREACH OF CONTRACT
Precondition for filing action Not required
Section 14, Rule X, Book III of the Rules implementing the Labor Code was
promulgated by the Secretary of Labor only for the purpose of administering and
enforcing the provisions of the Labor Code on conditions of employment. In other
words, Rule X is merely a guide to the enforcement of the substantive law on labor.
The Court, thus, makes the distinction and so holds that Section 14, Rule X, Book III
of the Rules is not the decisive law in a CIVIL SUIT for damages instituted by an
injured person during a vehicular accident against a working student of a school and
against the school itself. The present case does not deal with a labor dispute on
conditions of employment between an alleged employee and an alleged employer. It
invokes a claim brought by one for damages for injury caused by the patently
negligent acts of a person, against both doer-employee and his employer. Hence,
the reliance on the implementing rule on labor to disregard the primary liability of an
employer under Article 2180 of the Civil Code is misplaced. An implementing rule on
labor cannot be used by an employer as a shield to void liability under the
substantive provisions of the Civil Code.
(Filamer Christian Institute vs. IAC; [G.R. No. 75112; August 17, 1992.])
(1) To help meet the demand of the economy for trained manpower;
(2) To establish a national apprenticeship program through the participation of
employers, workers and government and non-government agencies; and
(3) To establish apprenticeship standards for the protection of apprentices.
An apprenticeship agreement with a minor shall be signed in his behalf by his parent
or guardian, if the latter is not available, by an authorized representative of the
Department of Labor, and the same shall be binding during its lifetime.
Every apprenticeship agreement entered into under this Title shall be ratified by the
appropriate apprenticeship committees, if any, and a copy thereof shall be furnished
both the employer and the apprentice.
(b) In the premises of one or several designated firms in the case of programs
sponsored by a group or association of employers or by a civic organization; or
ART. 66. Appeal to the Secretary of Labor and Employment. - The decision of the
authorized agency of the Department of Labor and Employment may be appealed by
any aggrieved person to the Secretary of Labor and Employment within five (5) days
from receipt of the decision. The decision of the Secretary of Labor and Employment
shall be final and executory.
ART. 68. Aptitude testing of applicants. - Consonant with the minimum qualifications
of apprentice-applicants required under this Chapter, employers or entities with duly
recognized apprenticeship programs shall have primary responsibility for providing
appropriate aptitude tests in the selection of apprentices. If they do not have
adequate facilities for the purpose, the Department of Labor and Employment shall
perform the service free of charge.
SECTION 9. Who may establish programs. Any entity, whether or not organized
for profit may establish or sponsor apprenticeship programs and employ apprentices.
Trade and industry associations may, however, recommend to the Secretary of Labor
and Employment appropriate educational qualifications for apprentices in certain
occupations. Such qualifications, if approved, shall be the educational requirements
for apprenticeship in such occupations unless waived by an employer in favor of an
applicant who has demonstrated exceptional ability. A certification explaining briefly
the ground for such waiver, and signed by the person in charge of the program, shall
be attached to the apprenticeship agreement of the applicant concerned.
SECTION 13. Physical fitness. Total physical fitness need not be required of an
apprentice-applicant unless it is essential to the expeditious and effective learning of
the occupation. Only physical defects which constitute real impediments to effective
performance as determined by the plant apprenticeship committee may disqualify an
applicant.
SECTION 14. Free physical examination. Physical examination of apprentice-
applicant preparatory to employment shall be provided free of charge by the
Department of Health or any government hospital. If this is not feasible, the firm or
entity screening the applicant shall extend such service free of charge.
Any entity with an apprenticeship program may elect to assume the responsibility for
physical examination provided its facilities are adequate and all expenses are borne
exclusively by it.
SECTION 15. Apprenticeable trades. The Bureau shall evaluate crafts and
operative, technical, nautical, commercial, clerical, technological, supervisory,
service and managerial activities which may be declared apprenticeable by the
Secretary of Labor and Employment and shall have exclusive jurisdiction to formulate
model national apprenticeship standards therefor.
SECTION 17. Participation in standards setting. The Bureau may request any
legitimate worker's and employer's organizations, civic and professional groups, and
other entities whether public or private, to assist in the formulation of national
apprenticeship standards.
At least five (5) working days before the actual date of termination, the party
terminating shall serve a written notice on the other, stating the reason for such
decision and a copy of said notice shall be furnished the Apprenticeship Division
concerned.
SECTION 20. Hours of work. Hours of work of the apprentice shall not exceed the
maximum number of hours of work prescribed by law, if any, for a worker of his age
and sex. Time spent in related theoretical instructions shall be considered as hours of
work and shall be reckoned jointly with on-the-job training time in computing in the
agreement the appropriate periods for giving wage increases to the apprentice.
An apprentice not otherwise barred by law from working eight hours a day may be
requested by his employer to work overtime and paid accordingly, provided there are
no available regular workers to do the job, and the overtime work thus rendered is
duly credited toward his training time.
Both practical and theoretical knowledge shall be evaluated and the credit shall
appear in the apprenticeship agreement which shall have the effect of shortening the
training and servicing as a basis for promoting him to a higher wage level. Such
credit shall be expressed in terms of hours.
An apprenticeship agreement with a minor shall be signed in his behalf by his parent
or guardian, or if the latter is not available, by an authorized representative of the
Department of Labor and Employment.
SECTION 24. Enforcement of agreement. No person shall institute any action for
the enforcement of any apprenticeship agreement or for damages for breach thereof,
unless he has exhausted all available administrative remedies. The plant
apprenticeship committee shall have initial responsibility for settling differences
arising out of apprenticeship agreements.
By the employer
By the apprentice
(a) Substandard or deleterious working conditions within the employer's
premises:
(b) Repeated violations by the employer of the terms of the apprenticeship
agreement;
(c) Cruel or inhuman treatment by the employer or his subordinates;
(d) Personal problems which in the opinion of the apprentice shall prevent him
from a satisfactory performance of his job; and
(e) Bad health or continuing illness.
SECTION 28. Ratio of theoretical instruction and on-the-job training. The normal
ratio is one hundred (100) hours of theoretical instructions for every two thousand
(2,000) hours of practical or on-the-job training. Theoretical instructions time for
occupations requiring less than two thousand hours for proficiency shall be computed
on the basis of such ratio.
SECTION 29. Wages. The wage rate of the apprentice shall start at seventy five
(75%) per cent of the statutory minimum wage for the first six (6) months; thereafter,
he shall be paid the full minimum wage, including the full cost of living allowance.
Representatives of cooperative, civic and other groups may also participate in such
committees.
SECTION 33. Creation of ad hoc advisory committees. The Secretary of Labor and
Employment may create ad hoc committees consisting of representatives of
management, labor and government on the national, regional and local levels to
advise and assist him in the formulation of policy, promotion of apprenticeship and
other matters he may deem appropriate to refer to them.
SECTION 34. Use of training centers. The Department may utilize the facilities
and services of the National Manpower and Youth Council, the Department of
Education, Culture and Sports and other public training institutions for the training of
apprentices.
SECTION 35. Coordination of training activities. The apprenticeship Division shall
coordinate with the above training centers all activities relating to apprenticeship.
The Bureau, through the Apprenticeship Division, shall provide technical guidance
and advice to the centers.
SECTION 36. Priority in use of training centers. Priority in the use of training
centers shall be given to recognized apprenticeship programs in skills which are
highly in demand in specific regions or localities as determined through surveys. The
Bureau shall recommend to the Secretary of Labor and Employment the
establishment of priorities based on data supplied by the Bureau of Local
Employment, Labor Statistics Service, the National Manpower and Youth Council, and
its own fundings. The Secretary of Labor and Employment may, however, also act on
the basis of petitions presented by qualified entities which are willing to bear the
costs of training.
(a) When grave national emergencies, particularly those involving the security of
the state, arise or particular requirements of economic development so demand,
the Secretary of Labor and Employment may recommend to the President of the
Philippines the compulsory training of apprentices required in a certain trades,
occupations, jobs or employment levels where shortage of trained manpower is
deemed critical;
(b) Where services of foreign technicians are utilized by private companies in
apprenticeable trades said companies are required to set up appropriate
apprenticeship programs.
2. Handicaps
ART. 78. DEFINITION
- There must be a link between the deficiency and the work which entitles the
employer to lessen the workers wage.
1. The names and addresses of the employer and the handicapped worker;
2. The rate of pay of the handicapped worker which shall not be less than
seventy-five (75%) percent of the legal minimum wage;
3. The nature of work to be performed by the handicapped worker; and
4. The duration of the employment.
(R.A. 7277)
AN ACT PROVIDING FOR THE REHABILITATION, SELF-DEVELOPMENT AND SELF-
RELIANCE OF DISABLED PERSONS AND THEIR INTEGRATION INTO THE MAINSTREAM
OF SOCIETY AND FOR OTHER PURPOSES.
TITLE I
GENERAL PROVISIONS
CHAPTER I
BASIC PRINCIPLE
Section 1. Title. This Act shall be known and cited as the "Magna Carta for
Disabled Persons."
Sec. 2. Declaration of Policy The grant of the rights and privileges for disabled
persons shall be guided by the following principles:
(a) Disabled persons are part of Philippine society, thus the State shall give full
support to the improvement of the total well-being of disabled persons and their
integration into the mainstream of society. Toward this end, the State shall adopt
policies ensuring the rehabilitation, self-development and self-reliance of disabled
persons. It shall develop their skills and potentials to enable them to compete
favorably for available opportunities.
(b) Disabled persons have the same rights as other people to take their proper
place in society. They should be able to live freely and as independently as
possible. This must be the concern of everyone the family, community and all
government and nongovernment organizations. Disabled persons' rights must
never be perceived as welfare services by the Government.
(c) The rehabilitation of the disabled persons shall be the concern of the
Government in order to foster their capacity to attain a more meaningful,
productive and satisfying life. To reach out to a greater number of disabled
persons, the rehabilitation services and benefits shall be expanded beyond the
traditional urban-based centers to community based programs, that will ensure
full participation of different sectors as supported by national and local
government agencies.
(d) The State also recognizes the role of the private sector in promoting the
welfare of disabled persons and shall encourage partnership in programs that
address their needs and concerns.
(e) To facilitate integration of disabled persons into the mainstream of society,
the State shall advocate for and encourage respect for disabled persons. The
State shall exert all efforts to remove all social, cultural, economic, environmental
and attitudinal barriers that are prejudicial to disabled persons.
Sec. 3. Coverage. This Act shall cover all disabled persons and, to the extent
herein provided, departments, offices and agencies of the National Government or
nongovernment organizations involved in the attainment of the objectives of this
Act.
Sec. 4. Definition of Terms. For purposes of this Act, these terms are defined as
follows:
(a) Disabled persons are those suffering from restriction or different abilities, as a
result of a mental, physical or sensory impairment, to perform an activity in the
manner or within the range considered normal for a human being;
(i) Sheltered Employment refers to the provision of productive work for disabled
persons through workshops providing special facilities, income-producing projects
or homework schemes with a view to giving them the opportunity to earn a living
thus enabling them to acquire a working capacity required in open industry;
(j) Auxiliary Social Services are the supportive activities in the delivery of social
services to the marginalized sectors of society;
(k) Marginalized Disabled Persons refer to disabled persons who lack access to
rehabilitative services and opportunities to be able to participate fully in
socioeconomic activities and who have no means of livelihood and whose
incomes fall below the poverty threshold; chan robles virtual law library
(l) Qualified Individual with a Disability shall mean an individual with a disability
who, with or without reasonable accommodations, can perform the essential
functions of the employment position that such individual holds or desires.
However, consideration shall be given to the employer's judgment as to what
functions of a job are essential, and if an employer has prepared a written
description before advertising or interviewing applicants for the job, this
description shall be considered evidence of the essential functions of the job;
(m)Readily Achievable means a goal can be easily attained and carried out
without much difficulty or expense. In determining whether an action is readily
achievable, factors to be considered include
1. the nature and cost of the action;
2. the overall financial resources of the facility or facilities involved in the action;
the number of persons employed at such facility; the effect on expenses and
resources, or the impact otherwise of such action upon the operation of the
facility;
3. the overall financial resources of the covered entity with respect to the
number of its employees; the number, type and location of its facilities; and
4. the type of operation or operations of the covered entity, including the
composition, structure and functions of the work force of such entity; the
geographic separateness, administrative or fiscal relationship of the facility or
facilities in question to the covered entity.
(n) Public Transportation means transportation by air, land and sea that provides
the public with general or special service on a regular and continuing basis;
TITLE II
RIGHTS AND PRIVILEGES OF DISABLED PERSONS
CHAPTER I
EMPLOYMENT
Five percent (5%) of all casual emergency and contractual positions in the
Departments of Social Welfare and Development; Health; Education, Culture and
Sports; and other government agencies, offices or corporations engaged in social
development shall be reserved for disabled persons.
(a) To encourage the active participation of the private sector in promoting the
welfare of disabled persons and to ensure gainful employment for qualified
disabled persons, adequate incentives shall be provided to private entities which
employ disabled persons.
(b) Private entities that employ disabled persons who meet the required skills or
qualifications, either as regular employee, apprentice or learner, shall be entitled
to an additional deduction, from their gross income, equivalent to twenty-five
percent (25%) of the total amount paid as salaries and wages to disabled
persons: Provided, however, That such entities present proof as certified by the
Department of Labor and Employment that disabled persons are under their
employ: Provided, further, That the disabled employee is accredited with the
Department of Labor and Employment and the Department of Health as to his
disability, skills and qualifications.
(c) Private entities that improve or modify their physical facilities in order to
provide reasonable accommodation for disabled persons shall also be entitled to
an additional deduction from their net taxable income, equivalent to fifty percent
(50%) of the direct costs of the improvements or modifications. This Section,
however, does not apply to improvements or modifications of facilities required
under Batas Pambansa Bilang 344.
The State shall also take measures to ensure the provision of vocational
rehabilitation and livelihood services for disabled persons in the rural areas. In
addition, it shall promote cooperation and coordination between the government and
nongovernmental organizations and other private entities engaged in vocational
rehabilitation activities.
The Department of Social Welfare and Development shall design and implement
training programs that will provide disabled persons with vocational skills to enable
them to engage in livelihood activities or obtain gainful employment. The
Department of Labor and Employment shall likewise design and conduct training
programs geared towards providing disabled persons with skills for livelihood.
Sec. 10. Vocational Guidance and Counseling. The Department of Social and
Welfare and Development, shall implement measures providing and evaluating
vocational guidance and counseling to enable disabled persons to secure, retain and
advance in employment. It shall ensure the availability and training of counselors and
other suitably qualified staff responsible for the vocational guidance and counseling
of disabled persons.
Sec. 11. Implementing Rules and Regulations. The Department of Labor and
Employment shall in coordination with the Department of Social Welfare and
Development (DSWD) and National Council for the Welfare of the Disabled Persons
(NCWDP) shall promulgate the rules and regulations necessary to implement the
provisions under this Chapter.
CHAPTER II
EDUCATION
Sec. 12. Access to Quality Education. The State shall ensure that disabled
persons are provided with access to quality education and ample opportunities to
develop their skills. It shall take appropriate steps to make such education accessible
to all disabled persons. It shall be unlawful for any learning institution to deny a
disabled person admission to any course it offers by reason of handicap or disability.
The State shall take into consideration the special requirements of disabled persons
in the formulation of educational policies and programs. It shall encourage learning
institutions to take into account the special needs of disabled persons with respect to
the use of school facilities, class schedules, physical education requirements, and
other pertinent consideration.
The State shall also promote the provision by learning institutions, especially higher
learning institutions of auxiliary services that will facilitate the learning process for
disabled persons.
Sec. 13. Assistance to Disabled Students. The State shall provide financial
assistance to economically marginalized but deserving disabled students pursuing
post secondary or tertiary education. Such assistance may be in the form of
scholarship grants, student loan programs, subsidies, and other incentives to
qualified disabled students in both public and private schools. At least five percent
(5%) of the allocation for the Private Education Student Financial Assistance Program
created by virtue of R.A. 6725 shall be set aside for disabled students pursuing
vocational or technical and degree courses.
Sec. 14. Special Education. The State shall establish, maintain and support
complete, adequate and integrated system of special education for the visually
impaired, hearing impaired, mentally retarded persons and other types of
exceptional children in all regions of the country. Toward this end, the Department of
Education, Culture and Sports shall establish, special education classes in public
schools in cities, or municipalities. It shall also establish, where viable, Braille and
Record Libraries in provinces, cities or municipalities.
The National Government shall allocate funds necessary for the effective
implementation of the special education program nationwide. Local government units
may likewise appropriate counterpart funds to supplement national funds.
Sec. 15. Vocational or Technical and Other Training Programs. The State shall
provide disabled persons with training in civics, vocational efficiency, sports and
physical fitness, and other skills. The Department of Education, Culture and Sports
shall establish in at least one government-owned vocational and technical school in
every province a special vocational and technical training program for disabled
persons. It shall develop and implement sports and physical fitness programs
specifically designed for disabled persons taking into consideration the nature of their
handicap.
Sec. 16. Non-Formal Education. The State shall develop non-formal education
programs intended for the total human development of disabled persons. It shall
provide adequate resources for non-formal education programs and projects that
cater to the special needs of disabled persons.
Sec. 17. State Universities and Colleges. If viable and needed, the State
University or State College in each region or province shall be responsible for (a) the
development of material appliances and technical aids for disabled persons; (b) the
development of training materials for vocational rehabilitation and special education
instructions; (c) the research on special problems, particularly of the visually-
impaired, hearing-impaired, speech-impaired, and orthopedically-impaired students,
mentally retarded, and multi-handicapped and others, and the elimination of social
barriers and discrimination against disabled persons; and (d) inclusion of the Special
Education for Disabled (SPED) course in the curriculum.
The National Government shall provide these state universities and colleges with
necessary special facilities for visually-impaired, hearing-impaired, speech-impaired,
and orthopedically-impaired students. It shall likewise allocate the necessary funds in
support of the above.
CHAPTER III
HEALTH
Sec. 18. National Health Program. The Department of Health in coordination with
the National Council for the Welfare of Disabled Persons, shall institute a national
health program which shall aim to attain the following:
(a) prevention of disability, whether occurring prenatally or postnatally;
Sec. 19. Rehabilitation Centers. The Department of Health shall establish medical
rehabilitation centers in government provincial hospitals, and shall include in its
annual appropriation the necessary funds for the operation of such centers.
Sec. 20. Health Services. The State shall protect and promote the right to health
of disabled persons and shall adopt an integrated and comprehensive approach to
their health development which shall make essential health services available to
them at affordable cost.
The National Government shall provide an integrated health service for disabled
persons which shall include, but not limited to, the following:
(a) prevention of disability through immunization, nutrition, environmental
protection and preservation, and genetic counseling; and early detection of
disability and timely intervention to arrest disabling condition; and
CHAPTER IV
AUXILIARY SOCIAL SERVICES
Sec. 21. Auxiliary Social Services. The State shall ensure that marginalized
persons are provided with the necessary auxiliary services that will restore their
social functioning and participation in community affairs. Towards this end, the
Department of Social Welfare and Development shall develop and implement
programs on auxiliary social services that respond to the needs of marginalized
disabled persons. The components of such a program shall be as follows:
(a) assistance in the acquisition of prosthetic devices and medical intervention of
specialty services;
CHAPTER V
TELECOMMUNICATIONS
Sec. 24. Free Postal Charges for the Disabled. Postal charges shall be free on the
following:
(a) articles and literatures like books and periodicals, orthopedic and other devices,
and teaching aids for the use of the disabled sent by mail within the Philippines and
abroad; and
(b) aids and orthopedic devices for the disabled sent by abroad by mail for repair:
Provided, That the aforesaid items are for personal purposes only: Provided, further,
That the disabled person is a marginalized disabled as certified by the Social Welfare
and Development Office of the local government unit concerned or the Department
of Social Welfare and Development.
CHAPTER VI
ACCESSIBILITY
Sec. 25. Barrier-Free Environment. The State shall ensure the attainment of a
barrier-free environment that will enable disabled persons to have access in public
and private buildings and establishments and such other places mentioned in Batas
Pambansa Bilang 344, otherwise known as the "Accessibility Law".
The national and local governments shall allocate funds for the provision of
architectural facilities or structural features for disabled persons in government
buildings and facilities.
Sec. 26. Mobility. The State shall promote the mobility of disabled persons.
Disabled persons shall be allowed to drive motor vehicles, subject to the rules and
regulations issued by the Land Transportation Office pertinent to the nature of their
disability and the appropriate adaptations or modifications made on such vehicles.
Sec. 27. Access to Public Transport Facilities. The Department of Social Welfare
and Development shall develop a program to assist marginalized disabled persons
gain access in the use of public transport facilities. Such assistance may be in the
form of subsidized transportation fare.
The said department shall also allocate such funds as may be necessary for the
effective implementation of the public transport program for the disabled persons.
CHAPTER VII
POLITICAL AND CIVIL RIGHTS
Sec. 30. Right to Assemble. Consistent with the provisions of the Constitution,
the State shall recognize the right of disabled persons to participate in processions,
rallies, parades, demonstrations, public meetings, and assemblages or other forms of
mass or concerned action held in public.
Sec. 31. Right to Organize. The State recognizes the right of disabled persons to
form organizations or associations that promote their welfare and advance or
safeguard their interests. The National Government, through its agencies,
instrumentalities and subdivisions, shall assist disabled persons in establishing self-
help organizations by providing them with necessary technical and financial
assistance.
Concerned government agencies and offices shall establish close linkages with
organizations of the disabled persons in order to respond expeditiously to the needs
of disabled persons. National line agencies and local government units shall assist
disabled persons in setting up specific projects that will be managed like business
propositions.
To ensure the active participation of disabled persons in the social and economic
development of the country, their organizations shall be encouraged to participate in
the planning, organization and management of government programs and projects
for disabled persons.
TITLE III
PROHIBITION ON DISCRIMINATION AGAINST DISABLED PERSONS
CHAPTER I
DISCRIMINATION ON EMPLOYMENT
(b) information obtained during the medical condition or history of the applicant
is collected and maintained on separate forms and in separate medical files and is
treated as a confidential medical record; Provided, however, That:
1. supervisors and managers may be informed regarding necessary restrictions
on the work or duties of the employees and necessary accommodations;
2. first aid and safety personnel may be informed, when appropriate, if the
disability may require emergency treatment;
3. government officials investigating compliance with this Act shall be provided
relevant information on request; and
4. the results of such examination are used only in accordance with this Act.
CHAPTER II
DISCRIMINATION ON TRANSPORTATION
CHAPTER III
DISCRIMINATION ON THE USE OF PUBLIC ACCOMMODATIONS AND
SERVICES
Sec. 35. Public Accommodations and Services. For purposes of this Chapter,
public accommodations and services shall include the following:
(a) an inn, hotel, motel, or other place of lodging, except for an establishment
located within a building that contains not more than five (5) rooms for rent or
hire and that is actually occupied by the proprietor of such establishment as the
residence of such proprietor;
For purposes of this Section, the term "individuals or class of individuals" refers to
the clients or customers of the covered public accommodation that enters into
the contractual, licensing or other arrangement.
Sec. 38. Implementing Rules and Regulations. The Department of Public Works
and Highways shall formulate the rules and regulations necessary to implement the
provisions of this Chapter.
TITLE IV
FINAL PROVISIONS
Sec. 39. Housing Program. The National Government shall take into consideration
in its national shelter program the special housing requirements of disabled persons.
Sec. 40. Role of National Agencies and Local Government Units. Local
government units shall promote the establishment of organizations of disabled
persons in their respective territorial jurisdictions. National agencies and local
government units may enter into joint ventures with organizations or associations of
disabled persons to explore livelihood opportunities and other undertakings that shall
enhance the health, physical fitness and the economic and social well-being of
disabled persons.
The Government shall sponsor a volunteer service program which shall harness the
involvement of private individuals in the provision of assistance to disabled persons.
Sec. 43. Continuity Clause. Should any department or agency tasked with the
enforcement or formulation of rules and regulations and guidelines for
implementation of any provision of this Act is abolished, merged with another
department or agency or modified, such shall not affect the enforcement or
formulation of rules, regulations and guidelines for implementation of this Act to the
effect that
(a) In case of abolition, the department or agency established to replace the
abolished department or agency shall take-over the functions under this Act of
the abolished department or agency.
(b) In case the department or agency tasked with the enforcement or formulation
of rules, regulations and guidelines for implementation of this Act is merged with
another department or agency, the former shall continue the functions under this
Act of the merged department or agency.
(c) In case of modification, the department or agency modified shall continue the
functions under this Act of the department or agency that has undergone the
modification.
Sec. 45. Authority of Court. The court may grant any equitable relief that such
court considers to be appropriate, including, to the extent required by this Act:
(a) granting temporary, preliminary or permanent relief;
2. for any subsequent violation, a fine of not less than One hundred thousand
pesos (P100,000.00) but not exceeding Two hundred thousand pesos
(P200,000.00) or imprisonment for not less than two (2) years but not more
than six (6) years, or both at the discretion of the court.
(b) Any person who abuses the privileges granted herein shall be punished with
imprisonment of not less than six (6) months or a fine of not less than Five
thousand pesos (P5,000.00), but not more than Fifty thousand pesos
(P50,000.00), or both, at the discretion of the court.
(c) If the violator is a corporation, organization or any similar entity, the officials
thereof directly involved shall be liable therefor.
(d) If the violator is an alien or a foreigner, he shall be deported immediately after
service of sentence without further deportation proceedings.
Sec. 47. Appropriations. The amount necessary to carry out the provisions of this
Act shall be included in the General Appropriations Act of the year following its
enactment into law and thereafter.
Sec. 48. Separability Clause. Should any provisions of this Act be found
unconstitutional by a court of law, such provisions shall be severed from the
remainder of the Act, and such action shall not affect the enforceability of the
remaining provisions of this Act.
Sec. 49. Repealing Clause. All laws, presidential decrees, executive orders and
rules and regulations inconsistent with the provisions of this Act are hereby repealed
or modified accordingly.
Sec. 50. Effectivity. This Act shall take effect fifteen (15) days after its publication
in any two (2) newspapers of general circulation.
ART. 79. When employable. - Handicapped workers may be employed when their
employment is necessary to prevent curtailment of employment opportunities and
when it does not create unfair competition in labor costs or impair or lower working
standards.
ART. 81. Eligibility for apprenticeship. - Subject to the appropriate provisions of this
Code, handicapped workers may be hired as apprentices or learners if their handicap
is not such as to effectively impede the performance of job operations in the
particular occupations for which they are hired.
(a) The names and addresses of the employer and the handicapped worker;
(b) The rate of pay of the handicapped worker which shall not be less than
seventy-five (75%) percent of the legal minimum wage;
(c) The nature of work to be performed by the handicapped worker; and
(d) The duration of the employment.
3. Learners
- A learner who has worked during the first two months shall be deemed a regular
employee if training is terminated by the employer before the end of the stipulated
period through no fault of the learner.
ART. 74. When learners may be hired. - Learners may be employed when no
experienced workers are available, the employment of learners is necessary to
prevent curtailment of employment opportunities, and the employment does not
create unfair competition in terms of labor costs or impair or lower working
standards.
ART. 75. Learnership agreement. - Any employer desiring to employ learners shall
enter into a learnership agreement with them, which agreement shall include:
ART. 77. Penalty clause. - Any violation of this Chapter or its implementing rules and
regulations shall be subject to the general penalty clause provided for in this Code.
(a) The names and addresses of the employer and the learner;
(b) The occupation to be learned and the duration of the training period which
shall not exceed three (3) months;
(c) The wage of learner which shall be at least 75 percent of the applicable
minimum wage; and
(d) A commitment to employ the learner, if he so desires, as a regular employee
upon completion of training.
A learner who has worked during the first two months shall be deemed a regular
employee if training is terminated by the employer before the end of the stipulated
period through no fault of the learner.
The employer shall furnish a copy each of the learnership agreement to the learner,
the Bureau, and the Apprenticeship Division of the appropriate Regional Office within
five (5) working days following its execution by the parties.
4. Women Workers
Chapter I
EMPLOYMENT OF WOMEN
ART. 132. Facilities for women. - The Secretary of Labor and Employment
shall establish standards that will ensure the safety and health of women
employees. In appropriate cases, he shall, by regulations, require any employer
to:
(a) Provide seats proper for women and permit them to use such seats
when they are free from work and during working hours, provided they can
perform their duties in this position without detriment to efficiency;
(b) To establish separate toilet rooms and lavatories for men and women
and provide at least a dressing room for women;
(c) To establish a nursery in a workplace for the benefit of the women
employees therein; and
(d) To determine appropriate minimum age and other standards for
retirement or termination in special occupations such as those of flight
attendants and the like.
Criminal liability for the willful commission of any unlawful act as provided in this
Article or any violation of the rules and regulations issued pursuant to Section 2
hereof shall be penalized as provided in Articles 288 and 289 of this Code:
Provided, That the institution of any criminal action under this provision shall not
bar the aggrieved employee from filing an entirely separate and distinct action for
money claims, which may include claims for damages and other affirmative
reliefs. The actions hereby authorized shall proceed independently of each other.
(As amended by Republic Act No. 6725, May 12, 1989).
ART. 137. Prohibited acts. - (a) It shall be unlawful for any employer:
(1) To deny any woman employee the benefits provided for in this Chapter or to
discharge any woman employed by him for the purpose of preventing her
from enjoying any of the benefits provided under this Code.
(2) To discharge such woman on account of her pregnancy, or while on leave or in
confinement due to her pregnancy;
(3) To discharge or refuse the admission of such woman upon returning to her
work for fear that she may again be pregnant.
"Criminal liability for the willful commission of any unlawful act as provided in this
article or any violation of the rules and regulations issued pursuant to Section 2
hereof shall be penalized as provided in Articles 288 and 289 of this Code:
Provided, That the institution of any criminal action under this provision shall not
bar the aggrieved employee from filing an entirely separate and distinct action for
money claims, which may include claims for damages and other affirmative
reliefs. The actions hereby authorized shall proceed independently of each other."
Section 3. This Act shall take effect fifteen (15) days from the date of its
publication in at least two (2) national newspapers of general circulation.
5. Student Workers
R.A. 7323
For purposes of this Act, poor but deserving students refer to those whose
parent's combined incomes, together with their income, if any, do not exceed
Thirty six thousand pesos (P36,000) per annum. Employment should be at the
Labor Exchange Center of the Department of Labor and Employment (DOLE).
Sec. 2. Sixty per centum (60%) of said salary or wage shall be paid by the
employer in cash and forty per centum (40%) by the Government in the form of a
voucher which shall be applicable in the payment for his tuition fees and books in
any educational institution for secondary, tertiary, vocational or technological
education. The amount of the education voucher shall be paid by the Government
to the educational institution concerned within thirty (30) days from its
presentation to the officer or agency designated by the Secretary of Finance.
The voucher shall not be transferable except when the payee thereof dies or for a
justifiable cause stops in his duties in which case it can be transferred to his
brothers or sisters. If there be none, the amount thereof shall be paid his heirs or
to the payee himself, as the case may be.
Sec. 4. Any person or entity who shall make any fraudulent of fictitious claim
under this Act, regardless of whether payment has been made, shall upon
conviction be punished with imprisonment of not less than six (6) months and not
more than one (1) year and a fine of not less than Ten thousand pesos (P10,000),
without prejudice to their prosecution and punishment for any other offenses
punishable under the Revised Penal Code or any other penal statute.
In case of partnerships or corporations, the managing partner, general manager,
or chief executive officer, as the case may be, shall be criminally liable.
Sec. 5. The amount necessary to carry out the purposes of this Act is hereby
authorized to be appropriated in the General Appropriations Act for 1992 and the
subsequent annual general appropriations acts.
Sec. 6. This Act shall take effect after its publication in the Official Gazette or in
at least two (2) national newspapers of general circulation.
Chapter III
EMPLOYMENT OF HOUSEHELPERS
ART. 141. Coverage. - This Chapter shall apply to all persons rendering services in
households for compensation.
"Domestic or household service" shall mean service in the employers home which is
usually necessary or desirable for the maintenance and enjoyment thereof and
includes ministering to the personal comfort and convenience of the members of the
employers household, including services of family drivers.
ART. 142. Contract of domestic service. - The original contract of domestic
service shall not last for more than two (2) years but it may be renewed for such
periods as may be agreed upon by the parties.
ART. 143. Minimum wage. - (a) Househelpers shall be paid the following minimum
wage rates:
(1) Eight hundred pesos (P800.00) a month for househelpers in Manila, Quezon,
Pasay, and Caloocan cities and municipalities of Makati, San Juan, Mandaluyong,
Muntinlupa, Navotas, Malabon, Paraaque, Las Pias, Pasig, Marikina, Valenzuela,
Taguig and Pateros in Metro Manila and in highly urbanized cities;
(2) Six hundred fifty pesos (P650.00) a month for those in other chartered cities and
first-class municipalities; and
(3) Five hundred fifty pesos (P550.00) a month for those in other municipalities.
Provided, That the employers shall review the employment contracts of their
househelpers every three (3) years with the end in view of improving the terms and
conditions thereof.
Provided, further, That those househelpers who are receiving at least One thousand
pesos (P1,000.00) shall be covered by the Social Security System (SSS) and be
entitled to all the benefits provided thereunder. (As amended by Republic Act No.
7655, August 19, 1993).
ART. 144. Minimum cash wage. - The minimum wage rates prescribed under this
Chapter shall be the basic cash wages which shall be paid to the househelpers in
addition to lodging, food and medical attendance.
ART. 146. Opportunity for education. - If the househelper is under the age of
eighteen (18) years, the employer shall give him or her an opportunity for at least
elementary education. The cost of education shall be part of the househelpers
compensation, unless there is a stipulation to the contrary.
ART. 148. Board, lodging, and medical attendance. - The employer shall furnish
the househelper, free of charge, suitable and sanitary living quarters as well as
adequate food and medical attendance.
If the househelper leaves without justifiable reason, he or she shall forfeit any unpaid
salary due him or her not exceeding fifteen (15) days.
SECTION 6. Equivalent daily rate. The equivalent minimum daily wage rate of
househelpers shall be determined by dividing the applicable minimum monthly rate
by thirty (30) days.
SECTION 8. Minimum cash wage. The minimum wage rates prescribed under
this Rule shall be basic cash wages which shall be paid to the househelpers in
addition to lodging, food and medical attendance.
SECTION 9. Time and manner of payment. Wages shall be paid directly to the
househelper to whom they are due at least once a month. No deductions therefrom
shall be made by the employer unless authorized by the househelper himself or by
existing laws.
SECTION 13. Board, lodging and medical attendance. The employer shall
furnish the househelper free suitable and sanitary living quarters as well as adequate
food and medical attendance.
SECTION 14. Indemnity for unjust termination of service. If the period for
household service is fixed, neither the employer nor the househelper may terminate
the contract before the expiration of the term, except for a just cause. If the
househelper is unjustly dismissed, he or she shall be paid the compensation already
earned plus that for fifteen (15) days by way of indemnity.
If the househelper leaves without justifiable reason, he or she shall forfeit any unpaid
salary due him or her not exceeding fifteen (15) days.
SECTION 18. Employment records. The employer may keep such records as he
may deem necessary to reflect the actual terms and conditions of employment of his
househelper which the latter shall authenticate by signature or thumbmark upon
request of the employer.
SECTION 20. Relation to other laws and agreements. Nothing in this Rule
shall deprive a househelper of the right to seek higher wages, shorter working hours
and better working conditions than those prescribed herein, nor justify an employer
in reducing any benefit or privilege granted to the househelper under existing laws,
agreements or voluntary employer practices with terms more favorable to the
househelpers than those prescribed in this Rule.
R.A. 7655
(1) Eight hundred pesos (P800.00) a month for househelpers in Manila, Quezon,
Pasay and Caloocan cities and municipalities of Makati, San Juan, Mandaluyong,
Muntinlupa, Navotas, Malabon, Paraaque, Las Pias, Pasig, Marikina, Valenzuela,
Taguig and Pateros in Metro Manila and in highly urbanized cities;
(2) Six hundred fifty pesos (P650.00) a month for those in other chartered cities
and first class municipalities; and
(3) Five hundred fifty pesos (P550.00) a month for those in other municipalities;
Provided, That the employees shall review the employment contracts of their
househelpers every three (3) years with the end in view of improving the terms
and conditions thereof.
Provided, further, That those househelpers who are receiving at least One
thousand pesos (P1,000.00) shall be covered by the Social Security System (SSS)
and be entitled to all the benefits provided there under."
Sec. 2. Any violation of any provision of this Act shall be punished with an
imprisonment of not more than three (3) months or a fine of not more than Two
thousand pesos (P2,000.00) or both, at the discretion of the court.
Sec. 3. Any law, executive order, letter of instruction, or any part thereof, which
is inconsistent with any of the provisions of this Act is hereby repealed or
amended accordingly.
Sec. 4. This Act shall take effect fifteen (15) days after its publication in the
Official Gazette or in at least two (2) national newspapers of general circulation,
whichever comes earlier.
Rights of a Househelper (Wage, SSS, Art. 145, 147, 148, 150 Labor
Code and Art. 1694, 1698 Civil Code)
(a) Coverage in the SSS shall be compulsory upon all employees not
over sixty (60) years of age and their employers:
Provided, That in case of domestic helpers, their monthly income shall not be
less than one thousand pesos (Php.1000.00) a month:
Provided, further, That any benefit already earned by the employees under
private benefit plans existing at the time of the approval of this Act shall not
be discontinued, reduced or otherwise impaired:
Provided, further, That private plans which are existing and in force at the
time of compulsory coverage shall be integrated with the plan of the SSS in
such a way where the employers contribution to his private plan is more than
that required of him in this Act, he shall pay to the SSS only the contribution
required of him and he shall continue his contribution to the SSS so that the
employers total contribution to his benefit plan and to the SSS shall be the
same as his contribution to his private benefit plan before the compulsory
coverage:
(Labor Code)
ART. 144. Minimum cash wage. - The minimum wage rates prescribed under
this Chapter shall be the basic cash wages which shall be paid to the
househelpers in addition to lodging, food and medical attendance.
ART. 148. Board, lodging, and medical attendance. - The employer shall
furnish the househelper, free of charge, suitable and sanitary living quarters as
well as adequate food and medical attendance.
(Civil Code)
Art. 1689. Household service shall always be reasonably compensated. Any
stipulation that household service is without compensation shall be void. Such
compensation shall be in addition to the house helper's lodging, food, and
medical attendance.
Art. 1690. The head of the family shall furnish, free of charge, to the house
helper, suitable and sanitary quarters as well as adequate food and medical
attendance.
Art. 1694. The head of the family shall treat the house helper in a just and
humane manner. In no case shall physical violence be used upon the house
helper.
Art. 1698. If the duration of the household service is not determined either by
stipulation or by the nature of the service, the head of the family or the house
helper may give notice to put an end to the service relation, according to the
following rules:
(1) If the compensation is paid by the day, notice may be given on any day that
the service shall end at the close of the following day;
(2) If the compensation is paid by the week, notice may be given, at the latest on
the first business day of the week, that the service shall be terminated at the
end of the seventh day from the beginning of the week;
(3) If the compensation is paid by the month, notice may be given, at the latest,
on the fifth day of the month that the service shall cease at the end of the
month.
7. Alien Employees
Title II
EMPLOYMENT OF NON-RESIDENT
ALIENS
(b) Any non-resident alien who shall take up employment in violation of the
provision of this Title and its implementing rules and regulations shall be
punished in accordance with the provisions of Articles 289 and 290 of the Labor
Code.
In addition, the alien worker shall be subject to deportation after service of his
sentence.
Section 4. Fee - Upon filing of application, the applicant shall pay a fee of
P8,000 for each application for AEP with a validity of 1 year. In case the period of
employment is more than 1 year, an additional P3,000 shall be charged for every
additional year of validity or a fraction thereof. In case of renewal, the applicant
shall pay a fee of P3,000 for each year of validity or a fraction thereof.
Replacement of AEP card shall require a fee of P750. In case of loss of AEP card,
request for replacement shall be accompanied by an Affidavit of Loss.
Section 5. Publication The Regional Office shall publish all applications for
new AEP, change or additional position in the same company or subsequent
assignment in related companies within 2 working days upon receipt of
application. Any objection or information against the employment of the foreign
national may be filed with the Regional Office anytime during the foreign
nationals period of employment.
In case the election or appointment will take place after the expiration of the AEP,
the application for renewal shall be filed on or before the expiration of the AEP,
and shall be renewed for 1 year. In case the foreign national is not re-elected or
re-appointed, the AEP shall be automatically revoked.
Section 11. Validity of Permit - The AEP shall be valid for a period of 1 year,
unless the employment contract, consultancy services, or other modes of
engagement provides otherwise, which in no case shall exceed 5 years.
Section 12. Suspension of AEP - The AEP may be suspended by the issuing
Regional Office, based on any of the following grounds, and after due process:
a. The continued stay of the foreign national may result in damage to the
interest of the industry or the country.
b. The employment of the foreign national is suspended by the employer
or by order of the Court.
Petitions for suspension of AEP issued shall be resolved within 30 calendar days
from receipt thereof.
Section 14. Appeal Any aggrieved party may file an appeal with the Secretary
within 10 days after receipt of the copy of
denial/suspension/cancellation/revocation order.
The decision of the Secretary shall be final and executor unless a Motion for
Reconsideration is filed within 10 days after receipt of the decision of the
Secretary. No second motion for reconsideration shall be entertained.
Section 15. Fines for Working without AEP - The Regional Director shall have
the power to order and impose a fine of P10,000 for every year or a fraction
thereof on foreign nationals found working without an AEP or with an expired
AEP.
Newly hired, elected or appointed officers may file application for new AEP
without penalty within 15 working days after signing of contract, election, or
appointment, or before the start of the actual term of office.
c. Effectivity - These Rules shall take effect 15 days after its publication in
2 newspapers of general circulation. The Records Officer of this
Department is hereby directed to file 3 certified copies thereof with the
University of the Philippines Law Center pursuant to Sec. 3, Chapter 2,
Book VII of the Administrative Code of 1987.
Fees
Permit fee is P8,000 for one year validity or fraction thereof plus
P3,000.00 for every additional year of validity or a fraction thereof, which
shall not exceed five years, to be paid upon submission of application.
Penalties
If upon evaluation, a foreign national is found to have worked without
or with expired AEP prior to application, a penalty of Ten Thousand Pesos
(P10,000.00) shall be imposed for working without an AEP for one (1) year
or fraction thereof.
The Regional Director may require the appearance/s of either or both the
foreign national and the parties providing the information/objection. If the
objection is meritorious, the Regional Director will deny the application or
cancel the AEP if it has been issued. If the objection is not meritorious, the
Regional Director will grant the AEP.
In case the election or appointment will take place after the expiration of the
AEP, the application shall be filed before the expiration of the AEP, and shall
be renewed for one year.
19. Is there a grace period in the filing of application for new AEP?
Yes, newly hired, elected or appointed officers are allowed to file application
for new AEP without penalty within fifteen (15) working days after signing of
contract, election or appointment.
X. QUITCLAIMS
A QUITCLAIM is a written instrument signed by the employee wherein he makes a
statement that he has received the benefits of Labor Standards, he releases any claim
against the employer, and other similar statements. A quitclaim is usually prepared by
the employer and only signed by the employee, making it a contract of adhesion.
- NATURE OF QUITCLAIMS
In this jurisdiction, quitclaims, waivers, or releases are looked upon with disfavor. They
are commonly frowned upon as contrary to public policy and ineffective to bar claims
for the full measure of the workers legal rights.
"Pacta privata juri publico derogare non possunt" - Private agreements between parties
cannot derogate from public right.
(Rizada vs NLRC, GR# 96982 09/21/99)
Not all quitclaims are per se invalid or against public policy, but those:
1. Where there is clear proof that the waver was wrangled from an unsuspecting or
gullible person, or
2. Where the terms of settlement are unconscionable on their face, are invalid.
In these cases, the law will step in to annul the questionable transaction.
(Lambo vs NLRC, GR# 111042 10/26/99)
While the Labor Code encourages all efforts towards the amicable settlement of a labor
dispute, and a quitclaim partakes the nature of a compromise, the implementing rules
require that such a settlement shall be approved by the Labor Arbiter, before whom
the case is pending, the reason being that the latter would be in a better position than
just any labor arbiter to personally determine the voluntariness of the agreement and
certify its validity.
The court found no grave abuse of discretion in the Labor Arbiter's ruling rejecting the
claim of the Company that the amount of P15,000 was given to Lorna Pimentel after
the death of her husband. The Labor Arbiter upheld the version of Lorna that she said
the amount was offered to the deceased Pimentel before his death, and was angrily
refused by him, and that she was constrained to accept the said amount on October
22, 1993 when her husband was already dead and lying in state as she needed money
for his burial. Moreover, the respondent NLRC correctly ruled that the waiver executed
by the wife not having been approved by the Labor Arbiter would not amount to
estoppel and would not divest an employee of his right to pursue his claim against the
employer. In labor jurisprudence, it is well settled that quitclaims are against public
policy. This court held that while the Labor Code encourages all efforts towards the
amicable settlement of a labor dispute, and a quitclaim partakes the nature of a
compromise, the implementing rules require that such a settlement shall be approved
by the Labor Arbiter, before whom the case is pending, after being satisfied that it was
voluntarily entered into by the parties and after having explained to them the terms
and consequences thereof. The reason for the rule is not hard to find. It is for the
employee's protection for the Labor Arbiter before whom the case is pending would be
in a better position than just any other labor arbiter to personally determine the
voluntariness of the agreement and certify its veracity.
(C & A Construction Co., Inc. vs NLRC, GR# 122279 11/22/99)
- VALIDITY OF QUITCLAIMS
The validity of quitclaims executed by laborers has long been recognized in this
jurisdiction. This court has ruled that not all waivers and quitclaims are invalid as
against public policy. If the agreement was voluntarily entered into and represents a
reasonable settlement of the claims of the employee, it is binding on the parties and
may not later be disowned simply because of a change of mind. Such legitimate
waivers resulting from voluntary settlements of laborers claims should be treated and
upheld as the law between the parties. However, when in this case, the voluntariness
of the execution of the quitclaim or release is put into issue, then the claim of the
employee may still be given due course. The law looks with disfavor upon quitclaims
and releases by employees pressured into signing the same by unscrupulous
employers minded to evade legal responsibilities.
(Phil. Carpet Exporters Assoc. vs PCMC, GR# 140269-70 09/14/00)
GENERAL RULE:
Quitclaims are presumed to be invalid
EXCEPT:
When the quitclaim;
1. Was voluntarily entered into
2. Represents a reasonable settlement of the claims of the employee
3. There is no proof that the consent of the employee was taken by fraud,
intimidation, etc.
CONSENT IN QUITCLAIMS
Contrary to the assumption of both the CA and the VA, the mere fact that Barquin was
not physically coerced or intimidated does not necessarily imply that he freely or
voluntarily consented to the terms of the quitclaim. Under Art. 1330 of the Civil Code,
consent may be vitiated not only through intimidation or violence but also by mistake,
undue influence, or fraud. Mistake may invalidate consent when it refers to the
substance of the thing which is the object of the contract or to those conditions which
have principally moved one or both parties to enter into a contract. There is fraud
when, through insidious words or machinations of one of the contracting parties, the
other is induced to enter into a contract which, without them, he would not have
agreed to.
(Phil. Carpet Exporters Assoc. vs PCMC, GR# 140269-70 09/14/00)
It is the employer and not the employee who has the burden of proving that the
quitclaim was voluntarily entered into by him.
(Phil. Carpet Exporters Assoc. vs PCMC, GR# 140269-70 09/14/00)
- COMPROMISE AGREEMENTS
The court upheld a compromise agreement that covered cases pending trial, on
appeal, and with final judgments. The court noted that Art. 2040 of the Civil Code
impliedly allowed such agreements. There was a limitation as to when these should be
entered into.
Gatchalian vs Arlegui upheld the right to compromise prior to the execution of a final
judgment. The Court ruled that the final judgment had been novated and supreseded
by a compromise agreement.
Also, Northern Lines vs CTA recognized the right to compromise final and executory
judgments, as long as such right was exercised by the proper party litigants.
(Magbanua vs UY, GR# 161003 05/06/05)
ELEMENTS OF A VALID COMPROMISE AGREEMENT;
NOVATION;
The principle of novation supports the validity of a compromise after final judgment.
Novation, a mode of extinguishing an obligation, is done by changing the object or
principal condition of an obligation, substituting the person of the debtor, or
surrogating a third person in the exercise of the rights of the creditor.
(Magbanua vs UY, GR# 161003 05/06/05)
Y. SECURITY OF TENURE
(Art. XIII, 1987 Constitution)
Section 3. The State shall afford full protection to labor, local and overseas, organized
and unorganized, and promote full employment and equality of employment
opportunities for all.
It shall guarantee the rights of all workers to self-organization, collective bargaining and
negotiations, and peaceful concerted activities, including the right to strike in
accordance with law. They shall be entitled to security of tenure, humane conditions of
work, and a living wage. They shall also participate in policy and decision-making
processes affecting their rights and benefits as may be provided by law.
The State shall promote the principle of shared responsibility between workers and
employers and the preferential use of voluntary modes in settling disputes, including
conciliation, and shall enforce their mutual compliance therewith to foster industrial
peace.
The State shall regulate the relations between workers and employers, recognizing the
right of labor to its just share in the fruits of production and the right of enterprises to
reasonable returns to investments, and to expansion and growth.
Security of tenure does not exclusively apply to regular employment only. It also applies
to probationary, seasonal, project and other forms of employment during the effectivity
thereof.
(Labor Code)
ART. 279. Security of tenure. - In cases of regular employment, the employer shall
not terminate the services of an employee except for a just cause or when authorized by
this Title. An employee who is unjustly dismissed from work shall be entitled to
reinstatement without loss of seniority rights and other privileges and to his full
backwages, inclusive of allowances, and to his other benefits or their monetary
equivalent computed from the time his compensation was withheld from him up to the
time of his actual reinstatement. (As amended by Section 34, Republic Act No. 6715,
March 21, 1989).
1. Scope
The right of the management to dismiss must be balanced against the managerial
employee's right to security of tenure which is not one of the guarantees he gives
up. This court has consistently ruled that managerial employees enjoy security of
tenure and, although the standards for their dismissal are less stringent, the loss of
trust and confidence must be substantial and founded on clearly established facts
sufficient to warrant the managerial employee's separation from the company.
Substantial evidence is of critical importance and the burden rests on the employer
to prove it. Due to its subjective nature, it can easily be concocted by an abusive
employer and used as a subterfuge for causes which are improper, illegal or
unjustified.
(PLDT vs Tolentino, GR# 143171 09/21/04)
The fact that one is a managerial employee does not by itself exclude him from the
protection of the constitutional guarantee of security of tenure.
(Fujitsu vs CA, GR# 158232 04/08/05)
In Globe Telecom, Inc. v. Florendo-Flores, it was held that where an employee ceases
to work due to a demotion of rank or a diminution of pay, an unreasonable situation
arises which creates an adverse working environment rendering it impossible for
such employee to continue working for her employer. Hence, her severance from the
company was not of her own making and therefore amounted to an illegal
termination of employment. (Cited in Francisco vs. NLRC, G.R. No. 170087, August
21, 2006.)
Cases
1. Diminution of pay. A diminution of pay is prejudicial to the employee and
amounts to constructive dismissal. (Francisco vs. NLRC)
2. Transfer of employee not amounting to constructive dismissal. Transfer of an
employee from one area of operation to another is a management prerogative
and is not constitutive of constructive dismissal, when the transfer is based on
sound business judgment, unattended by a demotion in rank or a diminution of
pay or bad faith. (Tan vs. NLRC, G.R. No. 128290, November 24, 1998.)
3. Transfer of employee amounting to constructive dismissal. A transfer amounts
to constructive dismissal when the transfer is unreasonable, unlikely,
inconvenient, impossible, or prejudicial to the employee. (Phil. Industrial Security
Agency Corp. vs. Aguinaldo, G.R. No. 149974, June 15, 2005.)
The failure of petitioner to fully substantiate his claim that the respondent stripped
him of his duties and functions is fatal to his present petition. Except for the sworn
statements previously discussed, which we have found to be lacking in probative
value, petitioner did not present any other proof of the alleged stripping of his
functions by the respondent. Petitioners bare allegations of constructive dismissal,
when not corroborated by the evidence on record, cannot be given credence.
(Fernando Go vs CA, GR# 158922 05/28/04)
- BURDEN OF PROOF
It is a settled rule that in employee termination disputes, the employer bears the
burden of proving that the employees dismissal was for just and valid cause.
That petitioner did indeed file a letter of resignation does not help the companys
case as, other than the fact of resignation, the company must still prove that the
employee voluntarily resigned. There can be no valid resignation where the act
was made under compulsion or under circumstances approximating compulsion,
such as when an employees act of handing in his resignation was a reaction to
circumstances leaving him no alternative but to resign. In this case, the Court held
that petitioner had been constructively dismissed as his resignation was a response
to the unacceptable appointment of another person to a position he still
occupied. In sum, the evidence does not support the existence of voluntariness
in petitioners resignation.
(Penaflor vs Outdoor Clothing Mfg. Corp., GR# 177114 01/21/10)
3. Preventive Suspension
a. Legal basis.
The right of employer to impose preventive suspension is not found in the Labor
Code itself.
The oft-cited legal basis for imposition of preventive suspension is Section 8 and
Section 9 of Rule XXIII, Book V, of the Omnibus Rules Implementing the Labor Code,
as amended by Department Order No. 9, Series of 1997, which read as follows:
Section 8. Preventive suspension. The employer may place the worker concerned
under preventive suspension only if his continued employment poses a serious and
imminent threat to the life or property of the employer or of his co-workers.
Section 9. Period of suspension. No preventive suspension shall last longer than thirty
(30) days. The employer shall thereafter reinstate the worker in his former or in a
substantially equivalent position or the employer may extend the period of
suspension provided that during the period of extension, he pays the wages and
other benefits due to the worker. In such case, the worker shall not be bound to
reimburse the amount paid to him during the extension if the employer decides, after
completion of the hearing, to dismiss the worker.
Grounds
Valid Suspension:
If the employees continued employment poses a serious and imminent threat to
the life and or property of the employer or of his co-workers. (Sec. 3, Rule 14,
Book V, OLD IRR)
Likewise, if the suspension is extended beyond the 30-day limit, the employee shall
be entitled to wages and other benefits for the period of the extension.
BASIS
Article 286 Labor Code: Employment is deemed not terminated when there is:
Bona-fide suspension by the employer of the operation of his business or undertaking
for a period not exceeding six (6) months;
Fulfillment by the employee of a military duty; or
Fulfillment by the employee of a civic duty.
The payment of wages of the employee as well as the grant of other benefits and
privileges while he is on a military or civic duty shall be subject to special laws and
decrees and to the applicable individual or collective bargaining agreement and
voluntary employer practice or policy.
In the 2005 case of JPL Marketing Promotions vs. CA, [G. R. No. 151966, July 8, 2005],
it was established that private respondent-employees sought employment from other
establishments even before the expiration of the six (6)-month period provided by
law. They admitted that all three of them applied for and were employed by another
establishment after they received the notice from JPL. Consequently, it was held that
petitioner JPL cannot be said to have terminated their employment for it was they
themselves who severed their relations with JPL. Thus, they are not entitled to
separation pay, even on the ground of compassionate justice. Clearly, the principle in
the law which grants separation pay applies only when the employee is dismissed by
the employer, which is not the case in this instance. In seeking and obtaining
employment elsewhere, private respondents effectively terminated their employment
with JPL.
ANALOGOUS SITUATION
There is no law on temporary retrenchment or lay-off, Article 286 applies only by
analogy.
Suspension of operation may involve only a section or department of the company
and not necessarily the entire operations.
The burden to prove bona-fide suspension of operation is on the employer.
DISTINGUISH from STOPPAGE of WORK OR SUSPENSION of OPERATION
Art. 128(c) Labor Code:
The Secretary of Labor and Employment may likewise order stoppage of work or
suspension of operations of any unit or department of an establishment when there is
non-compliance with the law or implementing rules and regulations poses grave and
imminent danger to the health and safety of workers in the workplace.
In case the violation is attributable to the fault of the employer, he shall pay the
employees concerned their salaries or wages during the period of such stoppage of
work or suspension of operation.
"No preventive suspension shall last longer than 30 days. The employer shall
thereafter reinstate the worker to his former or substantially equivalent position
of the employer may extend the period of suspension provided that during the
period of extension, he pays the wages and other benefits due to the worker. In
such case, the worker shall not be bound to reimburse the amount paid to him
during the extension if the employer decides after completion of the hearing to
dismiss the worker."
In this case, the supposed suspension was expected to last for more than the
period allowed by law, thus making the suspension constitutive of illegal
dismissal.
(Gandara Supply vs NLRC, GR# 126703 12/29/98)
Nothing in this rule requires that the report upon which the preventive
suspension was based should make a specific finding that the employee's
continued employment poses an imminent threat to the property of the
employer. It is enough that such fact can be gleaned from the circumstances of
the case.
Z. TERMINATION OF EMPLOYMENT
a. Substantial Evidence
It is basic that the findings of fact by the CA, when supported by substantial
evidence, are conclusive and binding upon the parties and are not reviewable
by the SC, unless the case falls under any of the exceptions to the rule, such as
when the findings by the CA are not supported by evidence.
(Philtread Tire & Rubber Corp. vs Alberto Vicente, GR# 142759 11/10/04)
When the NLRC declared that the burden of proof in dismissal cases shifts to
the employer only when the latter admits such dismissal, the NLRC ruled
erroneously in disregard of the law and prevailing jurisprudence on the matter.
As correctly articulated by the SolGen in his Comment to this petition, thus -
"Art. 277(b) of the Labor Code puts the burden of proving that the dismissal of
an employee was for a valid or authorized cause on the employer. It should be
noted that the said provision of law does not distinguish whether the employer
admits or does not admit the dismissal."
Time and again we have ruled that where there is no showing of a clear, valid
and legal cause for termination of employment, the law considers the case a
matter of illegal dismissal. The burden is on the employer to prove that the
termination of employment was for a valid and legal cause. For an employee's
dismissal to be valid, (a) the dismissal must be for a valid cause and (b) the
employee must be afforded due process.
As a general rule, one who pleads payment has the burden of proving it, and
even where the plaintiff must allege non-payment, the general rule is that the
burden rests on the defendant to prove payment, rather than on the plaintiff to
prove non-payment. The debtor has the burden of showing with legal certainty
that the obligation has been discharged by payment.
(Sevillana vs I.T. Ints Corp, GR# 99047 04/16/01)
Well-entrenched is the rule that substantial proof is sufficient as basis for the
imposition of any disciplinary action upon the employee. The standard of
substantial evidence is satisfied where the employer has reasonable ground to
believe that the employee is responsible for the misconduct and his
participation therein renders him unworthy of trust and confidence demanded
by his position. That petitioner violated respondents rules and regulations and
committed serious misconduct in the performance of his duties, have been
proved. Respondent thus lost its trust and confidence in petitioner. Under Art.
282 of the Labor Code, as amended, these are just causes for dismissing him
from the service.
(Millares vs PLDT, GR# 154078 05/06/05)
Pursuant to Sec. 5, Rule V, of the New Rules of the NLRC, the Labor Arbiter has
the authority to determine whether or not there is a necessity to conduct formal
hearings in cases brought before him for adjudication. The holding of a formal
hearing or trial is discretionary with the labor arbiter and is something that the
parties cannot demand as a matter of right. It is entirely within his authority to
decide a labor case before him, based on the position papers and supporting
documents of the parties, without trial or formal hearing. The requirements of
due process are satisfied when the parties are given the opportunity to submit
position papers wherein they are supposed to attach all the documents that
would prove their claim in case it be decided that no hearing should be
conducted or was necessary.
(Shoppes Manila Inc. vs NLRC, GR# 147125 01/14/04)
At any rate, petitioner was given enough opportunity to be heard, and his
dismissal was based on valid grounds. The essence of due process is simply an
opportunity to be heard, or as applied to administrative proceedings, an
opportunity to explain one's side or an opportunity to seek a reconsideration of
the action or ruling complained of. A formal or trial-type hearing is not at all
times and in all instances essential, as the due process requirements are
satisfied where the parties are afforded their fair and reasonable opportunity to
explain their side of the controversy at hand. What is frowned upon is the
absolute lack of notice and hearing.
(Valiao vs CA, GR# 146621 07/30/04)
Due process under the Labor Code involves 2 aspects: first, SUBSTANTIVE -
the valid and authorized causes of termination of employment under the Labor
Code; and second, PROCEDURAL - the manner of dismissal.
In the present case, the CA affirmed the findings of the labor arbiter and the
NLRC that the termination of employment of respondent was based on a just
cause. This ruling is not at issue in this case. The question to be determined is
whether the procedural requirements were complied with.
The records belie Amulars claim of denial of procedural due process. He chose
not to present his side at the administrative hearing. In fact, he avoided the
investigation into the charges against him by filing his illegal dismissal
complaint ahead of the scheduled investigation. These facts show that the
employee was given the opportunity to be heard and he cannot now come to
the Court protesting that he was denied this opportunity. To belabor a point the
Court has repeatedly made in employee dismissal cases, the essence of due
process is simply an opportunity to be heard; it is the denial of this opportunity
that constitutes violation of due process of law.
(Technol Eight Phils. Corp. vs NLRC, GR# 187605 04/13/10)
Petitioners complain that they were denied due process when they were not
furnished a copy of the evidence against them or the minutes of the
investigation. It is oft repeated that in administrative proceedings, due process
is served by the mere fact that each party is afforded an opportunity to air its
side, not necessarily through verbal argumentation, but also through pleadings
in which the parties may explain their side of the controversy. It is of record that
petitioners were informed of the charges against them and were given the
opportunity to present their defense, not just in the administrative investigation,
but also in the proceedings before the Labor Arbiter and NLRC. The
requirements of due process were more than adequately satisfied.
(Oscar Garcia vs NLRC, GR# 160339 03/14/08)
c. Burden of Proof
In constructive dismissal cases, the employer has the burden of proving that its
conduct and action or the transfer of an employee are for valid and legitimate
grounds such as genuine business necessity. Particularly, for a transfer not to
be considered a constructive dismissal, the employer must be able to show that
such transfer is not unreasonable, inconvenient, or prejudicial to the employee.
Failure of the employer to overcome this burden of proof taints the employees
transfer as a constructive dismissal.
In the present case, the employer failed to discharge this burden. The
combination of harsh actions taken by the bank rendered the employment
condition of the employee hostile and unbearable for the following reasons:
Third, the employer failed to present any valid reason why it had to require the
employee to go to the Makati Head Office to undergo branch head training
when it could have just easily required the latter to undertake the same training
in the VISMIN area.
Finally, there was nothing in the order of transfer indicating the position which
the employee would occupy after his training; thus, the employee was
effectively placed in a floating status. The banks contention that the
employee was assigned to a sensitive position in the DUHO Task Force is
suspect when considered with the fact that he was made to undergo branch
head training which is totally different from a position that entails reconciling
book entries of all branches of the former. Reconciling book entries is
essentially an accounting task.
(Phil. Veterans Bank vs NLRC , GR# 188882 03/30/10)
It would imply at the very least that where a penalty less punitive would suffice,
whatever missteps may be committed by labor ought not to be visited with a
consequence so severe. It is not only because of the law's concern for the
workingman. There is, in addition, his family to consider.
(Almira vs BF Goodrich, GR# L-34974 07/25/74)
First. Basically, the reason cited for the dismissal of private respondent is
sleeping on the job in violation of Company Rule 15-b. Was the private
respondent sleeping on the job or was he merely idle and, as he claimed,
waiting for the next cylinder to be checked? Evidence on this score is material,
for it is the be-all and end-all of petitioners cause, in view of the gravity of the
penalty of separation, as provided by the Company Rules and Regulation. In
termination disputes, the burden of proof is always on the employer to prove
that the dismissal was for a just and valid cause. What is at stake here is not
only the job itself of the employee but also his regular income therefrom which
is the means of livelihood of his family.
A thorough review of the record discloses that, contrary to the findings of the
Labor Arbiter, petitioners claim that private respondent slept on the job on
February 10, 1995 was not substantiated by any convincing evidence other
than the bare allegation of petitioner. The report of Ronaldo M. Alvarez, Acting
Quality Control Department Head of petitioner corporation, on the
circumstances which ultimately served as basis for the termination of private
respondents employment, did not confirm the alleged violation by private
respondent of the pertinent Company Rule 15-b. The report merely stated
private respondents denial and response to petitioners allegation which he
reiterated in his written reply.
Second. Petitioners reliance on the authorities it cited that sleeping on the job
is always a valid ground for dismissal, is misplaced. The authorities cited
involved security guards whose duty necessitates that they be awake and
watchful at all times inasmuch as their function, to use the words in Luzon
Stevedoring Corp. v. Court of Industrial Relations, is "to protect the company
from pilferage or loss." Accordingly, the doctrine laid down in those cases is not
applicable to the case at bar.
NOTE:
(c) Fraud or willful breach by the employee of the trust reposed in him by his
employer or duly authorized representative;
(d) Commission of a crime or offense by the employee against the person of his
employer or any immediate member of his family or his duly authorized
representatives; and
NOTE:
The just causes enumerated in this article are acts of omission or commission by
the employee. Because they are his faults, they justify certain action against him,
possibly dismissal. But it does not always have to be dismissal. The penalty has to be
proportionate to the offense. Furthermore, discharge based on a just cause does not
entitle the employee to any separation pay. But court rulings have recognized some
exceptions, particularly if the employees offense does not amount to serious
misconduct or does not reflect on the employees moral character. In such situation,
if the employees long years of service are otherwise satisfactory, the court may
grant financial assistance.
In every case of dismissal, the employee, under Art. 277(b), is entitled to ample
opportunity to explain his side. If this right is denied, the dismissal is defective. The
Court calls it ineffectual. This means that the dismissal will be upheld because the
employee by his act deserves to be dismissed but the employer, because he
disregarded the proper procedure, will be ordered to pay the employees full
backwages from the time of his dismissal to the time the Court finds that the
dismissal is for a just cause. In short, both the employer and the employee are
penalized: the employee loses his job, the employer pays full backwages.
(Serrano vs NLRC, GR# 117040 01/27/00)
Definition
Just causes for dismissal of employee may be defined as those lawful or valid
grounds for termination of employment which arise from causes directly attributable
to the fault or negligence of the erring employee.Just causes are usually serious or
grave in nature and attended by willful or wrongful intent or they reflected adversely
on the moral character of the employees.
As opposed to authorized causes under Article 283 wherein the termination of
employment is dictated by necessity of the business, the dismissal under just causes
is imposed by the employer to the erring employee as a punishment for the latters
acts or omission.
No Separation Pay
An employee who is terminated from employment for a just cause is not entitled to
payment of separation benefits. Section 7, Rule I, Book VI, of the Omnibus Rules
Implementing the Labor Code provides:
1. First notice: Notice to Explain (NTE) or order to show cause. A written notice
served on the employee specifying the ground or grounds for termination, and
giving to said employee reasonable opportunity within which to explain his side.
2. Hearing or formal investigation. A hearing or conference during which the
employee concerned, with the assistance of counsel if the employee so desires, is
given opportunity to respond to the charge, present his evidence or rebut the
evidence presented against him.
3. Second notice: Notice of decision. A written notice of termination served on
the employee indicating that upon due consideration of all the circumstances,
grounds have been established to justify his termination. (See Art. 277[b] and Sec
2, Rule I, Book VI, IRR)
Service of Notices.
In case of termination, the employee must be personally served with notices (notice
to show cause and notice of termination). Ideally, this should be done by personally
handing a copy of the notice to the employee concerned. However, if this is not
possible, the notices may be served on the employees last known address either by
ordinary or registered mail (from legal viewpoint, registered mail is preferred).
The mere posting of the notice on the bulletin board is not sufficient compliance.
(Shoppers Gain Supermart, 1996)
If the employee refused to receive notice, the employer must serve the same by
registered mail at his last known address. (See Nueva Ecija Electric Coop case, 2005)
Opportunity to Respond.
The very purpose of requiring the employer to observe proper termination process is
to give the employee ample opportunity to respond to the charges against him or to
defend himself. What the law require is ample opportunity.
Ample opportunity means every kind of assistance that management must accord
the employee to enable him to prepare adequately for his defense including legal
representation.
Cases
1. The employee refused to participate in the investigation being conducted by
the personnel management. The Court ruled that by refusing to participate, he
cannot claim that he was denied due process. (Leonardo vs. NLRC, 2000.)
2. The employment contract contains stipulation that the employment may be
terminated by either party after one month notice or one month salary in lieu
of notice. The stipulation was held to be illegal. The requirement of prior notice
and opportunity to be heard cannot be substituted by mere payment of salary.
(PNB vs. Cabansag, 2005.)
Cases
1. The employees (an accounting manager) act of willfully understating
the companys profits or financial position, committed as it was in order to
save costs, which to her warped mind, was supposed to benefit her
employer, partakes serious misconduct. It was not merely a violation of
company policy, but of the law itself, and put the employer at risk of being
made legally liable. The dismissal in this case is warranted. An employer
cannot be compelled to retain in its employ someone whose services is
inimical to its interests. (Llamas vs. Ocean Gateway, G.R. No. 179293, August
14, 2009.)
2. Two traffic operators who placed free long distance calls was dismissed
by PLDT. The dismissal was upheld as valid. The dishonesty committed by the
erring employee qualifies as serious misconduct especially that it goes to the
very heart and essence of the company. Long distance call is the lifeblood of
PLDT. (PLDT vs. Montemayor, G.R. No. 88626, October 12, 1990.)
3. A ticket freight clerk was dismissed for dishonesty for charging to his
VISA credit card some plane tickets in spite of the cash payment made by
passengers. The dismissal was for a just cause. (PAL vs. NLRC, G.R. No.
117038. September 25, 1997.)
4. The case involved toll guards assigned at the North Luzon Tollway,
Bulacan interchange, who were caught accepting bribe in the form of cash
and a dog from a motorist who was suspected of illegally transporting dogs.
The dismissal was upheld as for just cause. Bribery constitutes serious
misconduct. (Phil. National Construction vs. NLRC, G.R. No. 128345, May 18,
1999.)
In Maebo v. NLRC, G.R. No. 107721, 10 January 1994, the court reiterated that in
order that an employer may terminate an employee on the ground of willful
disobedience to the employers orders, regulations or instructions, it must be
established that the said orders, regulations or instructions are:
1. reasonable and lawful;
2. sufficiently known to the employee; and,
3. in connection with the duties which the employee has been engaged to
discharge. (See AHS/Philippines, Inc. vs. CA, G.R. No. 111807, June 14, 1996.)
Cases
1. The formal challenge brought by employee of the reasonableness or
the motives of a companys policy is not an excuse for the employee not to
obey said policy. (GTE Directories Corp. vs. Sanchez, May 27, 1991.)
2. Damage to employer is not important. Although there was no damage
to the employer, the dismissal of the driver for insubordination was upheld.
The lack of resulting damage is unimportant when the heart of the charge is
the crooked and anarchic attitude of the employee towards his employer.
(Nuez vs. NLRC, G.R. No. 107574 December 28, 1994.)
In order that the willful disobedience by the employee of the orders, regulations
or instructions of the employer may constitute a just cause for terminating his
employment, said orders, regulations, or instructions must be:
2. the order violated must have been reasonable and lawful and made known to
the employee and must pertain to the duties which he had been engaged to
discharge.
As held in the 2004 case of Coca-Cola Bottlers Philippines, Inc. vs. Vital, [G. R. No.
154384, Sept. 13, 2004], if an employee was merely following the instructions of
his supervisor, his act should be deemed in good faith. Clearly, his dismissal from
the service on the ground of willful disobedience or violation of company rules
and regulations is not justified.
(c) it must show that the employee has become unfit to continue working for the
employer.
In the 2005 case of Fujitsu Computer Products Corporation of the Philippines vs.
CA, [G. R. No. 158232, April 8, 2005], the respondents act of sending an e-mail
message as an expression of sympathy for the plight of a superior can hardly be
characterized as serious misconduct as to merit the penalty of dismissal. There is
no showing that the sending of such e-mail message had any bearing or relation
on respondents competence and proficiency in his job. To reiterate, in order to
consider it a serious misconduct that would justify dismissal under the law, the
act must have been done in relation to the performance of his duties as would
show him to be unfit to continue working for his employer.
In a 2004 case where the employee was shown to have committed various
violations of the companys rules and regulations, the Supreme Court ruled that
his dismissal from the service is in order. Indeed, a series of irregularities when
put together may constitute serious misconduct. (Gustilo vs. Wyeth Phils., Inc., G.
R. No. 149629, Oct. 4, 2004).
Applying the foregoing standards, the Supreme Court ruled in a 2000 case that
the act of the employee in throwing a stapler and uttering abusive language upon
the person of the plant manager may be considered from a laymans perspective
as a serious misconduct. However, in order to consider it a serious misconduct
that would justify dismissal under the law, it must have been done in relation to
the performance of her duties as would show her to be unfit to continue working
for her employer. The acts complained of, under the circumstances they were
done, did not in any way pertain to her duties as a nurse. Her employment
identification card discloses the nature of her employment as a nurse and no
other. Also, the memorandum informing her that she was being preventively
suspended pending investigation of her case was addressed to her as a nurse.
Hence, she cannot be held in violation therefor. (Philippine Aeolus Automotive
United Corporation vs. NLRC, G. R. No. 124617, April 28, 2000).
In the 2003 case of Roquero vs. Philippine Air Lines, Inc., [G. R. No. 152329, April
22, 2003], the Supreme Court affirmed the validity of the dismissal of petitioner
who was caught red-handed possessing and using methampethamine
hydrochloride or shabu in a raid conducted inside the company premises by PAL
security officers and NARCOM personnel. Said the Supreme Court: It is of public
knowledge that drugs can damage the mental faculties of the user. Roquero was
tasked with the repair and maintenance of PALs airplanes. He cannot discharge
that duty if he is a drug user. His failure to do his job can mean great loss of lives
and properties. Hence, even if he was instigated to take drugs he has no right to
be reinstated to his position. He took the drugs fully knowing that he was on duty
and more so that it is prohibited by company rules. Instigation is only a defense
against criminal liability. It cannot be used as a shield against dismissal from
employment especially when the position involves the safety of human lives.
Immorality.
In another case, the dismissal of the supervisor who maintained a concubine and
practically drove his family away because of his illicit relationship was held legal.
As supervisor, he failed to set a good example to the several personnel under
him. (Sanchez vs. Ang Tibay, 54 O. G. 4515). chanrobles virtual law library
The act of a lady teacher in falling in love with a student, not immoral.
The act of a 30-year old lady teacher, of falling in love with her student whose
age is 16, is not an immoral act which would justify the termination of her
employment. The school utterly failed to show that petitioner took advantage of
her position to court her student. If the two eventually fell in love despite the
disparity of their ages and academic levels, this only lends substance to the
truism that the heart has reasons of its own which reason does not know. But,
definitely, yielding to this gentle and universal emotion is not to be so casually
equated with immorality. The deviation of the circumstances of their marriage
from the usual societal pattern cannot be considered as a defiance of
contemporary social mores. (Chua-Qua vs. Clave, G. R. No. L-49549, Aug. 30,
1990).
Fighting within work premises may be deemed a valid ground for the dismissal of
an employee. Such act adversely affects the employers interests for it distracts
employees, disrupts operations and creates a hostile work atmosphere. (Solvic
Industrial Corp. vs. NLRC, G. R. No. 125548, Sept. 25, 1998).
The fact that an employee filed a criminal case against the other employee
involved in a fight while the latter did not, does not necessarily mean that the
former was the aggrieved party. (Flores vs. NLRC, G. R. No. 109362, May 15,
1996, 256 SCRA 735).
In one case where the fisticuffs between an employee and a security guard
occurred in a store within the company auxiliary compound, about 15 meters
from the gate, the Supreme Court ruled that the penalty of dismissal was not
commensurate with the misconduct, considering the length of service and the
surrounding circumstances of the incident. (North Camarines Lumber Co., Inc. vs.
Barreda, G. R. No. 75436, Aug. 21, 1987).
And in another case where the fight occurred outside the work premises and did
not lead to any disruption of work or any hostile environment in the work
premises, the dismissal of the employee who figured in the fight was considered
too harsh a penalty. (Solvic Industrial Corp. vs. NLRC, G. R. No. 125548, Sept. 25,
1998; 296 SCRA 432, 441).
In Reynolds Philippine Corporation vs. Eslava, [137 SCRA 259 (1985)], the
dismissed employee circulated several letters to the members of the companys
board of directors calling the executive vice-president and general manager a
big fool, anti-Filipino, and accusing him of mismanagement, inefficiency, lack
of planning and foresight, petty favoritism, dictatorial policies, one-man rule,
contemptuous attitude to labor, anti-Filipino utterances and activities. As a result
of this, said employees dismissal was held legal in view of these utterances.
In Asian Design and Manufacturing Corporation vs. Deputy Minister of Labor, [142
SCRA 79 (1986)], the dismissed employee made false and malicious statements
against the foreman (his superior) by telling his co-employees: If you dont give
a goat to the foreman, you will be terminated. If you want to remain in this
company, you have to give a goat. Further, the dismissed employee therein
likewise posted a notice in the comfort room of the company premises which
read: Notice to all Sander Those who want to remain in this company, you
must give anything to your foreman. Failure to do so will be terminated Alice
80. The Supreme Court declared the dismissal of said employee based on these
malicious statements valid and legal.
In De la Cruz vs. NLRC, [G. R. No. 82703, September 15, 1989, 177 SCRA 626],
the act of an employee in hurling invectives at a company physician such as
sayang ang pagka-professional mo and putang ina mo, was held to constitute
insubordination and conduct unbecoming an employee which should warrant his
dismissal.
In Bondoc vs. NLRC, [G. R. No. 103209, July 28, 1997, 276 SCRA 288], utterances
on different occasions towards a co-employee of the following: -Di bale bilang na
naman ang araw mo. Sige lang, patawa tawa ka pa, eh bilang na bilang na
ang araw mo. Matakot ka sa Diyos, bilang na ang araw mo; Mag-ingat ka sa
paglabas mo sa Silahis Hotel. - Unggoy xxx ulol were held unquestionably as
partaking the form of grave threat or coercion which justified the dismissal of the
offender.
In Autobus Workers Union vs. NLRC, [G. R. No. 117453, June 26, 1998, 291 SCRA
219, 228], the act of the employee in calling his supervisor gago ka and
taunting the latter by saying bakit anong gusto mo, tang ina mo was held
sufficient ground to dismiss the former.
But in Samson vs. NLRC, [G. R. No. 121035, April 12, 2000], the following
utterances: Si EDT (referring to Epitacio D. Titong, General Manager and
President of the company), bullshit yan, sabihin mo kay EDT yan, and sabihin
mo kay EDT, bullshit yan while making the dirty finger gesture, were not held
to be sufficient to merit the dismissal of the employee. The Supreme Court
justified said finding by distinguishing this case from the De la Cruz, Autobus,
Asian Design and Reynolds cases [supra], in that the said offensive utterances
were not made in the presence of the employees superior; that the companys
rules and regulations merely provide for verbal reminder for first offenders; and
that the penalty of dismissal was unduly harsh considering his 11 years of service
to the company.
In one case, an employee was validly terminated when he was caught gambling
within the company premises, it being a prohibited act carrying the penalty of
termination under the Company Rules. (Dimalanta vs. Secretary of Labor, G. R.
No. 83854, May 24, 1989). chanrobles virtual law library
However, the nature of the employees work, the dignity of his position and the
surrounding circumstances of the intoxication, must be taken into account.
For instance, the act of a managerial employee of reporting for work under the
influence of liquor and sleeping while on duty reflect his unworthiness of the trust
and confidence reposed on him. (Del Val vs. NLRC, G. R. No. 121806, Sept. 25,
1998, 296 SCRA 283).
The act of a pilot with the rank of captain, of forcing two co-pilots with the rank of
First Officers, to drink one evening at the coffee shop of a hotel in Cebu City, six
bottles of beer each, within thirty minutes, failing which, he ordered them to
stand erect and were hit on the stomach, was held as constitutive of serious
misconduct. The incident occurred with his full knowledge that his co-pilots have
flight duties as early as 7:10 a.m. the next day and as late as 12:00 p.m.
(Philippine Airlines, Inc. vs. NLRC, G. R. No. L-62961, Sept. 2, 1983).
In another case involving two (2) security guards who, while off-duty, joined a
drinking spree at a birthday party of a co-guard in a sari-sari store near the FTI
security office, the lesser penalty of 30-day suspension, not dismissal, was the
penalty held to be appropriate under the circumstances. The reason cited was the
fact that the company rules and regulations merely provided for suspension for
first offenders. (Quiones vs. NLRC, G. R. No. 105763, July 14, 1995).
In Luzon Stevedoring Corporation vs. CIR, [G. R. No. L-18683, Dec. 31, 1965], and
A Prime Security Services, Inc. vs. NLRC, [220 SCRA 142 (1993)], the act of an
employee of sleeping in his post, coupled with gross insubordination, dereliction
of duty and challenging superiors to a fight, was held as serious misconduct.
However, in the 2000 case of VH Manufacturing, Inc. vs. NLRC, [G. R. No. 130957,
Jan. 19, 2000], it was pronounced that to cite that sleeping on the job is always a
valid ground for dismissal is misplaced not only because the same was not
substantiated by any convincing evidence other than the bare allegation of the
employer but most significantly, because the authorities cited, Luzon Stevedoring
[supra] and A Prime [supra], are not applicable in this case since the function
involved in said cases was to protect the company from pilferage or loss.
Accordingly, the doctrine laid down in those cases is not applicable to the case at
bar.
In the 2004 case of Electruck Asia, Inc. vs. Meris, [G. R. No. 147031, July 27,
2004], where more than fifty employees were alleged to have slept at the same
time, the Supreme Court found it highly unlikely and contrary to human
experience that all fifty-five employees including respondents were at the same
time sleeping. If indeed the Night Manager chanced upon respondent-employees
sleeping on the job, why he did not at least rouse some or all of them to put them
on notice that they were caught in flagrante defies understanding.
Dismissal is too harsh a penalty for the offense of eating while at work, under the
attendant circumstances of the case. (Tanduay Distillery Labor Union vs. NLRC, G.
R. No. 73352, Dec. 06, 1995).
In a 2002 case, it was held that urinating in a workplace other than the one
designated for the purpose by the employer constitutes violation of reasonable
regulations intended to promote a healthy environment under Art. 282 [1] of the
Labor Code for purposes of terminating employment, but the same must be
shown by evidence. An employee cannot be terminated based on this ground if
there is no evidence that he did urinate in a place other than a rest room in the
premises of his work. (Tan vs. Lagrama, G. R. No. 151228, Aug. 15, 2002).
- (Oscar Garcia vs Malayan Insurance, GR#
The charge of drug abuse inside the company's premises and during working
hours against petitioner constitutes serious misconduct, which is one of the just
causes for termination. Misconduct is improper or wrong conduct. It is the
transgression of some established and definite rule of action, a forbidden act, a
dereliction of duty, willful in character, and implies wrongful intent and not
merely an error in judgment. The misconduct to be serious within the meaning
of the Act must be of such a grave and aggravated character and not merely
trivial or unimportant. Such misconduct, however serious, must nevertheless, in
connection with the work of the employee, constitute just cause for his
separation. This Court took judicial notice of scientific findings that drug abuse
can damage mental faculties of the user. It is beyond question therefore that
any employee under the influence of drugs cannot possibly continue doing his
duties without posing a serious threat to the lives and property of his co-
workers and even his employer.
(Bughaw vs Treasure Island, GR# 173151 03/28/08)
Simple misconduct which does not merit employees termination from his
employment. Although, an employer has the right to discipline its erring
employees, exercise of such right should be tempered with compassion and
understanding. The magnitude of the infraction committed by an employee
must be weighed and equated with the penalty prescribed and must be
commensurate thereto, in view of the gravity of the penalty of dismissal or
termination from the service. The employer should bear in mind that in
termination cases, what is at stake is not simply the employees job or position
but his very livelihood.
(PLDT vs Berbano, GR# 165199 11/27/09)
Sleeping on the job without prior authorization was held to constitute serious
misconduct and is a valid ground for dismissal. The court considered that the
employee in this case (Tomada) was directly responsible for a significant
portion of his employers property. Tomadas act was not merely a disregard
company rules, but in effect an open invitation for others to violate those same
company rules.
Although his nearly two decades of service might generally be considered for
some form of financial assistance to shield him from the effects of his
termination, Tomadas acts reflect a regrettable lack of concern for his
employer. If length of service justifies the mitigation of the penalty of dismissal,
then this Court would be awarding disloyalty, distorting in the process the
meaning of social justice and undermining the efforts of labor to cleanse its
ranks of undesirables.
(Tomada Sr. vs RFM Corp, GR# 163270 09/11/09)
Conviction in a criminal case is not necessary to find just cause for termination
of employment. Criminal cases require proof beyond reasonable doubt while
labor disputes require only substantial evidence, which means such relevant
evidence as a reasonable mind might accept as adequate to justify a
conclusion. The evidence in this case was reviewed by the appellate court and
two labor tribunals endowed with expertise on the matter the Labor Arbiter
and the NLRC. They all found substantial evidence to conclude that Capor had
been validly dismissed for dishonesty or serious misconduct.
(Reno Foods Inc. vs NLM-Katipunan, GR# 164016 03/15/10)
In the present case, the Court found substantial evidence to prove that a
serious misconduct has been committed to justify termination from
employment. The Certified Public Accountant and Corporate Finance Manager
of the company submitted a report dated February 19, 2000 stating that in spite
of managements memorandum, the keys to the office and filing cabinets were
not surrendered. It was likewise stated in the report that petitioner Wilfredo
Baron pulled out some records without allowing a representative from the
internal audit team to inspect them. He noticed Wilfredo Baron deleting some
files from the computer, which could no longer be retrieved. Moreover, a
member of the audit team saw Cynthia Junatas (another petitioner) carrying
some documents, including a Daily Collection Report. When asked to present
the documents for inspection, Junatas refused and tore the document.
In addition, the audit team discovered that MSI incurred an inventory shortage
of One Million Thirty Thousand Two Hundred Fifty-Eight Pesos and Twenty-One
Centavos (P1,030,258.21). It found that Wilfredo Baron, the operations
manager, in conspiracy with the other petitioners, orchestrated massive
irregularities and grand scale fraud, which could no longer be documented
because of theft of company documents and deletion of computer files.
Unmistakably, the unauthorized taking of company documents and files, failure
to pay unremitted collections, failure to surrender keys to the filing cabinets
despite earlier instructions, concealment of shortages, and failure to record
inventory transactions pursuant to a fraudulent scheme are acts of grave
misconduct, which are sufficient causes for dismissal from employment.
(Baron vs NLRC, GR# 182299 02/22/10)
b. Gross and Habitual Neglect
Single isolated acts of negligence do not constitute a just cause for the dismissal
of the employee.
However, in a number of cases, the SC upheld the validity of dismissal on the
ground of gross negligence even if the act complained of was not habitual. Thus,
a bank employee was found grossly negligent when she delivered newly
approved credit cards to a person she had not even seen before and she did not
even ask for receipts, thereby enabling fictitious persons to use these cards,
causing P740,000.00 loss to the bank. (SeeCitibank vs. Gatchalian, G.R. No.
111222, January 18, 1995.)
1. The failure to report for work or absence without valid or justifiable reason;
and
2. A clear intention to sever the employer-employee relationship. This is the
more determinative factor being manifested by some overt acts.
1. notice to apprise the employee of the particular acts or omissions for which
his dismissal is sought; and
2. subsequent notice to inform him of the employers decision to dismiss him.
In the 2004 case of Agabon vs. NLRC, [G.R. No. 158693, Nov. 17, 2004], while the
validity of the dismissal based on abandonment was upheld, however, the
employer was deemed to have violated due process when it did not follow the
notice requirements and instead argued that sending notices to the last known
addresses would have been useless because they did not reside there anymore.
Unfortunately for the employer, this is not a valid excuse because the law
mandates the twin notice requirements be sent to the employees last known
address. Thus, it should be held liable for non-compliance with the procedural
requirements of due process.
In a 2004 case, it was ruled that the immediate filing of complaint for illegal
dismissal by the employees praying for their reinstatement, negates the finding
of abandonment. They cannot, by any reasoning, be said to have abandoned their
work, for as the Supreme Court had consistently ruled, the filing by an employee
of a complaint for illegal dismissal is proof enough of his desire to return to work,
thus negating the employers charge of abandonment. (Unicorn Safety Glass, Inc.
vs. Basarte, G. R. No. 154689, Nov. 25, 2004).
An employee who had truly forsaken his job would not have bothered to file a
complaint for illegal dismissal. (Hodieng Concrete Products vs. Dante Emilia, G. R.
No. 149180, Feb. 14, 2005).
For instance, the filing of such complaint the very next day after the employee
was removed (Anflo Management & Investment Corp. vs. Bolanio, G. R. No.
141608, Oct. 4, 2002) or two (2) days after receiving the termination letter
(EgyptAir, vs. NLRC, G. R. No. 63185, Feb. 27, 1989) or six (6) days (Masagana
Concrete Products vs. NLRC, G. R. No. 106916, Sept. 3, 1999) or four (4) days
from the time the employees were prevented from entering their workplace, is an
indication that they have not abandoned their work. (Artemio Labor vs. NLRC, G.
R. No. 110388, Sept. 14, 1995).
The Supreme Court did not likewise consider the lapse of nine (9) months
(Kingsize Manufacturing Corp. vs. NLRC, G. R. Nos. 110452-54, Nov. 24, 1994) or
six (6) months before filing the complaints for illegal dismissal as an indication of
abandonment. Under the law, the employee has four (4) years within which to
institute his action for illegal dismissal. (Pare vs. NLRC, G. R. No. 128957, Nov. 16,
1999).
The rule that abandonment of work is inconsistent with the filing of a complaint
for illegal dismissal is not applicable to a case where the complainant does not
pray for reinstatement and just asks for separation pay instead. It goes without
saying that the prayer for separation pay, being the alternative remedy to
reinstatement, contradicts private respondent-employees stance. That he was
illegally dismissed is belied by his own pleadings as well as contemporaneous
conduct. (Jo vs. NLRC, G. R. No. 121605, Feb. 2, 2000).
But in Sentinel Security Agency, Inc. vs. NLRC, [G. R. No. 122468, Sept. 3, 1998],
the fact that complainants did not pray for reinstatement was considered by the
Supreme Court as not sufficient proof of abandonment. A strong indication of the
intention of the complainants to resume work is their allegation that on several
dates, they reported to the Security Agency for reassignment, but were not given
any. In fact, the contention of complainants was that the Agency constructively
dismissed them. Abandonment has recently been ruled to be incompatible with
constructive dismissal.
In the 2004 case of The Philippine American Life and General Insurance Co. vs.
Gramaje, [G. R. No. 156963, Nov. 11, 2004], the Assistant Vice-President was
directed to report to her new assignment and submit to a medical examination.
She did not comply leading to her being declared as having abandoned her work.
However, the Supreme Court ruled that the there could not have been an
abandonment since at the time she was being asked to report to her new
assignment, she had already filed a case for illegal dismissal against her
employer. For the employer to anticipate the employee to report for work after
the latter already filed a case for illegal dismissal before the NLRC, would be
absurd. The two requisites for abandonment are not present here. There was no
abandonment as the latter is not compatible with constructive dismissal.
The respondent-employee in the 2002 case of Hantex Trading Co., Inc. vs. CA,
[G. R. No. 148241, September 27, 2002], accused of abandoning his work, filed a
complaint and prayed therein, among others, for reinstatement. However, during
the initial hearing before the Labor Arbiter, the petitioners made an offer to
reinstate him to his former position, but he defiantly refused the offer despite
the fact that in his complaint, he was asking for reinstatement. Again, the
petitioners extended the offer in its position paper filed with the Labor Arbiter but
was likewise rejected by the respondent. The petitioners consequently asserted
that these circumstances are clear indications of respondents lack of further
interest to work and effectively negate his claim of illegal dismissal.
Neither does the fact that petitioners made offers to reinstate respondent legally
disproves illegal dismissal. As observed by the Court of Appeals, to which the
Supreme Court was in full agreement, the offer may very well be a tacit
admission of petitioners that they erred in dismissing him verbally and without
observance of both substantive and procedural due process. Curiously,
petitioners offer of reinstatement was made only after more than one (1) month
from the date of the filing of the illegal dismissal case. Their belated gesture of
goodwill is highly suspect. If petitioners were indeed sincere in inviting
respondent back to work in the company, they could have made the offer much
sooner. In any case, their intentions in making the offer are immaterial, for the
offer to re-employ respondent could not have the effect of validating an otherwise
arbitrary dismissal.
In Ranara vs. NLRC, [212 SCRA 631], where the employer offered to re-employ
the illegally dismissed employee, the Supreme Court stated:
The fact that his employer later made an offer to re-employ him did not cure the
vice of his early arbitrary dismissal. The wrong had been committed and the
wrong done. Notably, it was only after the complaint had been filed that it
occurred to Chang, in a belated gesture of good will, to invite Ranara back to
work in his store. Changs sincerity is suspect. We doubt if his offer would have
been made if Ranara had not complained against him. At any rate, sincere or not,
the offer of reinstatement could not correct the earlier illegal dismissal of the
petitioner. The private respondents incurred liability under the Labor Code from
the moment Ranara was illegally dismissed and the liability did not abate as a
result of Changs repentance.
In the 2001 case of Suan vs. NLRC, [G. R. No. 141441, June 19, 2001], a letter was
sent to the petitioner almost one (1) month after the filing of the complaint for
illegal dismissal which required him to explain his absence without leave (AWOL).
He found refuge in the above case of Ranara. The Supreme Court, however, did
not find any analogy between the two cases as the factual backdrop of Ranara
[supra] is not the same as Suan. In contrast, petitioner Jose Suan in the latter
case who suffered a stroke, was not dismissed but was only asked to go on
extended leave from July 10 to August 10, 1997 because when petitioner reported
for work on July 10, 1997, after more than six months of sick leave, respondent
Oripaypay noticed that petitioners left arm down to his left limb was paralyzed,
thus Oripaypay could readily see that petitioner was not yet ready and physically
well to perform his usual assignment as master fisherman. However, after
petitioners extended leave expired, he did not return to work which prompted
private respondent Oripaypay to send him a letter dated August 16, 1997
requiring him to explain why no disciplinary action should be taken against him
for his absence without official leave. The said letter clearly shows that
respondent Oripaypay was waiting for the return of petitioner unlike in Ranara,
wherein petitioner Ranara, a driver, upon reporting for work, was surprised to find
some other person who replaced him in handling the vehicle previously assigned
to him, thus confirming his dismissal without proper notice.
In Agabon vs. NLRC, [G.R. No. 158693, November 17, 2004], the Supreme Court
held that the act of the petitioners who were frequently absent to engage in
subcontracting work for another company clearly shows the intention to sever the
employer-employee relationship with their employer. Hence, they are guilty of
abandonment.
Under the Labor Code, gross negligence is a valid ground for an employer to
terminate an employee. Gross negligence is negligence characterized by want
of even slight care, acting or omitting to act in a situation where there is a duty
to act, not inadvertently but willfully and intentionally with a conscious
indifference to consequences insofar as other persons may be affected. In this
case, however, there is no substantial basis to support a finding that petitioner
committed gross negligence.
Did petitioner in doing the alleged act use that reasonable care and
caution which an ordinarily prudent person would use in the same
situation?
It is not disputed that petitioner tried to turn left to avoid a collision. To put it
otherwise, petitioner did not insist on his right of way, notwithstanding the
green light in his lane. Still, the collision took place as the ten-wheeler careened
on the wrong lane. Clearly, petitioner exerted reasonable effort under the
circumstances to avoid injury not only to himself but also to his passengers and
the van he was driving. To hold that petitioner was grossly negligent under the
circumstances goes against the factual circumstances shown. It appears to us
he was more a victim of a vehicular accident rather than its cause.
(Tres Reyes vs Maxims Tea House, GR# 140853 02/27/03)
(1) The failure to report for work or absence without valid or justifiable reason,
and
(2) A clear intention to sever the employer-employee relationship.
The second element is the more determinative factor and should be manifested
by some overt acts. Mere absence is not sufficient. To prove abandonment, the
employer must show that the employee deliberately and unjustifiably refused to
resume his employment without any intention of returning. It is the employer
who has the burden of proof to show abandonment.
(Icawat vs NLRC, GR# 133573 06/20/00) &
(R. Transport Corp. vs Ejandra, GR# 148508 05/20/04)
Private respondent, after his vacation leave, immediately reported back for
work but was not allowed by the petitioners on the ground that he was already
replaced by regular drivers. After he was notified, of his termination, private
respondent lost no time in filing the case for illegal dismissal against petitioners.
He cannot therefore, by any reasoning, be said to have abandoned his work or
had no intention of going back to work. It would be illogical for him to have left
his job and later on file said complaint. We have consistently ruled that a charge
of abandonment is totally inconsistent with the immediate filing of a complaint
for illegal dismissal.
(Icawat vs NLRC, GR# 133573 06/20/00)
The rule that abandonment of work is inconsistent with the filing of a complaint
for illegal dismissal does not apply where the complainant does not pray for
reinstatement and just asks for separation pay instead. Public respondents
assertion that the institution of the complaint for illegal dismissal manifests
private respondents lack of intention to abandon his job is untenable. Such rule
applies where the complainant seeks reinstatement as a relief. Corollary, it has
no application where the complainant does not pray for reinstatement and just
asks for separation pay instead as in the present case. It goes without saying
that the prayer for separation pay, being the alternative remedy to
reinstatement, contradicts private respondents stance. That he was illegally
dismissed is belied by his own pleadings as well as contemporaneous conduct.
(Jo vs NLRC, GR# 121605 02/02/00)
To warrant removal from service, the negligence should not merely be gross,
but also habitual. Gross negligence implies a want or absence of, or failure to
exercise slight care or diligence, or the enitre absence of care. It evinces a
thoughtless disregard of consequences without exerting any effort to avoid
them.
(Union Motor Corp. vs NLRC, GR# 159738 12/09/04)
NOTE:
(RevisedINSUBORDINATION;
- GROSS Penal Code) REQUISITES
Chapter Three
DISCOVERY
For AND REVELATION
gross insubordination, alsoOF SECRETS
called willful disobedience of a lawful order, to
lie, two requisites are also necessary:
Art. 290. Discovering secrets through seizure of correspondence.
The
(1) Thepenalty
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prision correccional in itsintentional
must have been minimum and characterized
medium periods by a
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exceeding 500 pesos shall be imposed upon any private
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(2) whoviolated
The order in ordermust
to discover the secrets
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and made his to
papers or letters and reveal the contents thereof.
the employee and should pertain to the duties which he has been engaged to
discharge.
If the offender
(Cosmos shall
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Nagrama, GR# 164403the penalty shall be arresto
03/04/08)
mayor and a fine not exceeding 500 pesos.
Loss of confidence arising from fraud or willful breach of trust by employee of the
trust reposed in him by his employer or his duly authorized representative is a
just cause for termination of employment under Article 282 of the Labor Code of
the Philippines.
Fraud Meaning.
Fraud is any act, omission, or concealment which involves a breach of legal duty,
trust, or confidence justly reposed and is injurious to another.
What are the requisites for the ground of willful breach of trust?
In the 2004 case of Charles Joseph U. Ramos vs. The Honorable Court of Appeals
and Union Bank of the Philippines, [G.R. No. 145405, June 29, 2004], the Supreme
Court held that, in order to validly dismiss an employee on the ground of loss of
trust and confidence under Article 282, the following guidelines must be followed:
1. The loss of confidence must not be simulated;
2. It should not be used as a subterfuge for causes which are illegal, improper or
unjustified;
5. The employee involved holds a position of trust and confidence. (Tolentino vs.
PLDT, G. R. No. 160404, June 8, 2005).
In order to constitute a just cause for dismissal, the act complained of should be
work-related and must show that the employee concerned is unfit to continue
to work for the employer. (Sulpicio Lines, Inc. vs. Gulde, G. R. No. 149930, Feb.
22, 2002).
For instance, in the 2005 case of Philippine National Construction Corporation vs.
Matias, [G. R. No. 156283, May 6, 2005], undeniably, the position of project
controller - the position of respondent at the time of his dismissal - required trust
and confidence, for it related to the handling of business expenditures or
finances. However, his act allegedly constituting breach of trust and confidence
(referring to the unlawful scheme by PNCC of using its employees as dummies
for the acquisition of vast tract of land in Bukidnon and thereafter compelling
them to assign all rights over same properties in favor of PNCC a scheme by
PNCC which is a flagrant violation of the Constitution as regards the maximum
area of real property which a corporation can acquire under the CARP Law) was
not in any way related to his official functions and responsibilities as controller. In
fact, the questioned act pertained to an unlawful scheme deliberately engaged in
by petitioner in order to evade a constitutional and legal mandate.
Loss of trust and confidence must be based on a willful breach and founded on
clearly established facts. (Asia Pacific Chartering [Phils.], Inc. vs. Farolan, G. R.
No. 151370, Dec. 4, 2002).
This situation also holds in the case of supervisory personnel occupying positions
of responsibility. (Cruz vs. Coca-Cola Bottlers Phils., Inc., G. R. No. 165586, June
15, 2005).
The betrayal of this trust is the essence of the offense for which an employee is
penalized. (Santos vs. San Miguel Corporation, G. R. No. 149416, March 14,
2003).
There must be some basis for the loss of trust and confidence.
While it is true that loss of trust and confidence is one of the just causes for
termination, such loss of trust and confidence must, however, have some basis.
Proof beyond reasonable doubt is not required. It is sufficient that there must
only be some basis for such loss of confidence or that there is reasonable ground
to believe if not to entertain the moral conviction that the concerned employee is
responsible for the misconduct and that the nature of his participation therein
rendered him absolutely unworthy of trust and confidence demanded by his
position. (Central Pangasinan Electric Cooperative, Inc. vs. Macaraeg, G. R. No.
145800, Jan. 22, 2003).
In Limketkai Sons Milling, Inc. vs. Llamera, [G. R. No. 152514, July 12, 2005],
petitioners simply allege that respondents failure to report to the quality control
head the batch that did not meet the minimum standard showed connivance to
sabotage petitioners business. The Supreme Court ruled that not only is
petitioners logic flawed, it is an instance of arguing non sequitur. Said allegation
alone, without proven facts to back it up, could not and did not suffice as a basis
for a finding of willful breach of trust. Petitioners failed to prove the existence of a
valid cause for the dismissal of respondent. Therefore, the dismissal must be
deemed contrary to the provisions of the Labor Code, hence illegal.
In Santos vs. San Miguel Corporation, [G. R. No. 149416, March 14, 2003], it was
held that prolonged practice of encashing personal checks among payroll
personnel does not excuse or justify petitioners misdeeds. Petitioners willful and
deliberate acts were in gross violation of respondent companys policy against
encashment of personal checks of its personnel. She, as Finance Director, cannot
feign ignorance of such policy as she is duty-bound to keep abreast of company
policies related to financial matters within the corporation.
In Norkis Distributors, Inc. vs. NLRC, [G. R. No. 112230, July 17, 1995], where the
employer alleged inefficiency and loss of trust and confidence as grounds for
termination of employment, the High Tribunal said that these are negated by the
fact that the evidence shows that the employee received several promotions
since his employment in 1986 and was given bonuses for his collection efforts
and a compensation adjustment for his excellent performance.
In Etcuban, Jr. vs. Sulpicio Lines, Inc., [G. R. No. 148410, January 17, 2005], the
petitioner theorizes that even assuming that there was evidence to support the
charges against him, his dismissal from the service is unwarranted, harsh and is
not commensurate to his misdeeds, considering the following: first, his 16 long
years of service with the company; second, no loss or damages was suffered by
the company since the tickets were unissued; third, he had no previous
derogatory record; and, lastly, the amount involved is miniscule. Citing
jurisprudence, he appeals for compassion and requests that he be merely
suspended, or at the very least, given separation pay for his length of service.
The Supreme Court, however, found no merit in the petitioners contention:
We are not unmindful of the foregoing doctrine, but after a careful scrutiny of
the cited cases, the Court is convinced that the petitioners reliance thereon is
misplaced. It must be stressed that in all of the cases cited, the employees
involved were all rank-and-file or ordinary workers. As pointed out earlier, the
rules on termination of employment, penalties for infractions, insofar as fiduciary
employees are concerned, are not necessarily the same as those applicable to
the termination of employment of ordinary employees. Employers, generally, are
allowed a wider latitude of discretion in terminating the employment of
managerial personnel or those of similar rank performing functions which by their
nature require the employers trust and confidence, than in the case of ordinary
rank-and-file employees. (Citing Gonzales vs. NLRC, 355 SCRA 195 [2001]).
The fact that the petitioner has worked with the respondent for more than 16
years, if it is to be considered at all, should be taken against him. The infraction
that he committed, vis--vis his long years of service with the company, reflects a
regrettable lack of loyalty. Loyalty that he should have strengthened instead of
betrayed. If an employees length of service is to be regarded as a justification for
moderating the penalty of dismissal, it will actually become a prize for disloyalty,
perverting the meaning of social justice and undermining the efforts of labor to
cleanse its ranks of all undesirables. (Citing Flores vs. NLRC, 219 SCRA 350
[1993]).
xxx
In another case, Central Pangasinan Electric Cooperative, Inc. vs. Macaraeg, [G.
R. No. 145800, January 22, 2003], the teller and cashier (who were charged and
dismissed for unauthorized encashments of checks) have been employed with the
petitioner-electric cooperative for 22 and 19 years of continuous service,
respectively, and this is the first time that either of them has been
administratively charged. Nonetheless, their dismissal was held justified
considering the breach of trust they have committed. Well to emphasize, the
longer an employee stays in the service of the company, the greater is his
responsibility for knowledge and compliance with the norms of conduct and the
code of discipline in the company. Considering that they have mishandled the
funds of the cooperative and the danger they have posed to its members, their
reinstatement is neither sound in reason nor just in principle. It is irreconcilable
with trust and confidence that has been irretrievably lost.
In Salvador vs. Philippine Mining Service Corporation, [G. R. No. 148766, January
22, 2003], petitioner argues that assuming there was evidence to support the
charges against him, his dismissal from service is unwarranted, harsh and grossly
disproportionate to his act, considering his long years of service with the
company. The Supreme Court, however, disagreed, thusly:
To be sure, length of service is taken into consideration in imposing the penalty
to be meted an erring employee. However, the case at bar involves dishonesty
and pilferage by petitioner which resulted in respondents loss of confidence in
him. Unlike other just causes for dismissal, trust in an employee, once lost is
difficult, if not impossible, to regain. Moreover, petitioner was not an ordinary
rank-and-file employee. He occupied a high position of responsibility. As foreman
and shift boss, he had over-all control of the care, supervision and operations of
respondents entire plant. It cannot be over-emphasized that there is no
substitute for honesty for sensitive positions which call for utmost trust. Fairness
dictates that respondent should not be allowed to continue with the employment
of petitioner who has breached the confidence reposed on him. (Citing Galsim vs.
Philippine National Bank, 29 SCRA 293 [1969]). As a general rule, employers are
allowed wider latitude of discretion in terminating the employment of managerial
employees as they perform functions which require the employers full trust and
confidence. (Citing Gonzales vs. NLRC, 355 SCRA 195 [2001]).
In the case at bar, respondent has every right to dismiss petitioner, a managerial
employee, for breach of trust and loss of confidence as a measure of self-
preservation against acts patently inimical to its interests. Indeed, in cases of
this nature, the fact that petitioner has been employed with the respondent for a
long time, if to be considered at all, should be taken against him, (Citing Flores
vs. NLRC, 219 SCRA 350 [1993]). as his act of pilferage reflects a regrettable lack
of loyalty which he should have strengthened, instead of betrayed.
In Cruz vs. Coca-Cola Bottlers Phils., Inc., [G. R. No. 165586, June 15, 2005],
involving the spiriting out of thirty (30) cases of canned soft drinks loaded on
petitioners truck without the required documentation, the Supreme Court took
his long years of service as militating against his claim of good faith. Petitioners
length of service (as driver/helper), which spans almost fifteen (15) years, works
against his favor in this case. The reason is, it has long been held that the longer
an employee stays in the service of the company, the greater is his responsibility
for knowledge and compliance with the norms of conduct and the code of
discipline in the company.
This distinction has been underscored by the Supreme Court in recent decisions
involving the application of the doctrine of loss of trust and confidence. Thus, with
respect to rank-and-file personnel, loss of trust and confidence as ground for valid
dismissal requires proof of involvement in the alleged events in question, and that
mere uncorroborated assertions and accusations by the employer will not be
sufficient. But as regards a managerial employee, the mere existence of a basis
for believing that such employee has breached the trust of his employer would
suffice for his dismissal. Hence, in the case of managerial employees, proof
beyond reasonable doubt is not required, it being sufficient that there is some
basis for such loss of confidence, such as when the employer has reasonable
ground to believe that the employee concerned is responsible for the purported
misconduct, and the nature of his participation therein renders him unworthy of
the trust and confidence demanded by his position. (Etcuban, Jr. vs. Sulpicio
Lines, Inc., G. R. No. 148410, Jan. 17, 2005).
For example, as held in Coca-Cola Bottlers Philippines, Inc. vs. NLRC, [172 SCRA
751 (1989)], route salesmen are rank-and-file employees but they are highly
individualistic personnel who roam around selling products, deal with customers
and are entrusted with large assets and funds and property of the employer.
There is a high degree of trust and confidence reposed on them, and when such
confidence is breached, the employer may take proper disciplinary action on
them.
In holding that the dismissal of the food attendant was valid, the Supreme Court,
in Philippine Pizza, Inc. vs. Bungabong, [G. R. No. 154315, May 9, 2005], ruled
that where the employee has access to the employers property in the form of
merchandise and articles for sale, the relationship of the employer and the
employee necessarily involves trust and confidence. Hence, when respondent
drank stolen beer from the dispenser of Pizza Hut-Ermita on December 6, 1997,
he gave cause for his termination and his termination was within the ambit of
Article 282 of the Labor Code.
But in another case involving the same company, Coca-Cola Bottlers, Phils., Inc.
vs. Kapisanan ng Malayang Manggagawa sa Coca-Cola-FFW, [G. R. No. 148205,
Feb. 28, 2005], it was pronounced that the temporary assignment as route
salesman for a period of three (3) days of an employee who was employed as
driver-helper does not automatically make him an employee on whom his
employer reposed trust and confidence, for breach of which he shall be meted the
penalty of dismissal. The assumption by said employee, for only three days, of
some of the duties of a route salesman on orders of his employer, did not
automatically make him an employee holding a position of trust and confidence.
Despite his additional duties, said employee remained a driver-helper of the
petitioner. Thus, he cannot be dismissed based on loss of trust and confidence.
In Vallacar Transit, Inc. vs. NLRC, [G. R. No. 109809, July 17, 1995], it was held
that a non-managerial position such as a bus driver does not hold a position of
trust and confidence. That he figured in several accidents prejudicial to petitioner
cannot serve as basis for the loss of trust and confidence.
In the 2003 case of De la Cruz, Jr. vs. NLRC, G. R. No. 145417, [December 11,
2003], the petitioner was holding a managerial position in which he was tasked to
perform key functions in accordance with an exacting work ethic. His position
required the full trust and confidence of his employer. While petitioner could
exercise some discretion, this obviously did not cover acts for his own personal
benefit. As found by the court a quo, he committed a transgression that betrayed
the trust and confidence of his employer - reimbursing his familys personal travel
expenses out of company funds. Petitioner failed to present any persuasive
evidence or argument to prove otherwise. His act amounted to fraud or deceit
which led to the loss of trust and confidence of his employer.
The fact that the employer did not suffer losses from the dishonesty of the
dismissed employee because of its timely discovery does not excuse the latter
from any culpability. (Villanueva vs. NLRC, G. R. No. 129413, July 27, 1998).
In Diamond Motors Corporation vs. CA, [G. R. No. 151981, Dec. 1, 2003] and in
the earlier case of Philippine Airlines, Inc. vs. NLRC, [G. R. No. 126805, March 16,
2000] involving the commission of fraud against the company, it was ruled that
the fact that the employer failed to show it suffered losses in revenue as a
consequence of the employees act is immaterial. It must be stressed that actual
defraudation is not necessary in order that an employee may be held liable under
the company rule against fraud. That the dismissed employee attempted to
deprive the employer of its lawful revenue is already tantamount to fraud against
the company which warrants dismissal from the service.
In Gonzales vs. NLRC and Pepsi-Cola Products, Phils., Inc., [G. R. No. 131653,
March 26, 2001], it was held that the fact that the employer ultimately suffered
no monetary damage as the employee subsequently settled his account is of no
moment. This was not the reason for the termination of his employment in the
company but the anomalous scheme he engineered to cover up his past due
account which constitutes a clear betrayal of trust and confidence.
The Supreme Court has reiterated this rule in Santos vs. San Miguel Corporation,
[G. R. No. 149416, March 14, 2003]. Hence, even if the shortages have been fully
restituted, the fact that the employee has misappropriated company funds is a
valid ground to terminate the services of an employee of the company for loss of
trust and confidence. (See also San Miguel Corporation vs. Deputy Minister of
Labor and Employment, 145 SCRA 196, 203-204 [1986]).
The guidelines for the application of the doctrine of loss of confidence are:
Of course, it must be stressed that loss of confidence as a just cause for the
termination of employment is based on the premise that the employee holds a
position of trust and confidence, as when he is entrusted with responsibility
involving delicate matters, and the task of a janitor does not fall squarely under
this category.
(Delos Santos vs NLRC, GR# 121327 12/20/01)
There is no dispute over the fact that respondent was a managerial employee
and therefore loss of trust and confidence was a ground for his valid dismissal.
The mere existence of a basis for the loss of trust and confidence justifies the
dismissal of the employee.
Proof beyond reasonable doubt is not required provided there is a valid reason
for the loss of trust and confidence, such as when the employer has a
reasonable ground to believe that the managerial employee concerned is
responsible for the purported misconduct and the nature of his participation
renders him unworthy of the trust and confidence demanded by his position.
(PLDT vs Tolentino, GR# 143171 09/21/04)
Loss of trust and confidence, as a ground for dismissal, is premised on the fact
that the employee concerned holds a position of responsibility or of trust and
confidence. As such, the employee must be invested confidence on delicate
matters, such as the custody, handling, or care of the employer's money and
other assets. Loss of confidence as a just cause for dismissal was never
intended to provide employer's 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.
Having this in mind, 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. To the first class belong managerial
employee, i.e., those vested with the powers or prerogatives to lay down
management policies, effect personnel movements, or effectively recommend
such managerial actions; and to the second class belong cashiers, auditors,
property custodians, etc., or those who, in the normal and routine exercise of
their functions, regularly handle significant amounts of money or property.
(Rolando Aromin vs NLRC, GR# 164824 04/30/08)
d. Commission of a Crime or Offense against Employer
1. His employer;
2. Any immediate member of his employers family; or
3. His employers duly authorized representative.
Refers to an offense by the employee against the person of his employer or any
immediate member if his family or his duly authorized representative and thus,
the conviction of a crime involving moral turpitude is not analogous thereto as the
element of relation to his work or to his employer is lacking.
DOCTRINE OF INCOMPATIBILITY
Where the employee has done something that is contrary or incompatible with
the faithful performance of his duties, his employer has a just cause for
terminating his employment.
(Manila Chauffers League vs Bachrach Motor Co., 40 O.G. 159)
We cannot but agree with PEPSI that gross inefficiency falls within the purview
of other analogous causes to the foregoing, and constitutes, therefore, a just
cause to terminate an employee under Art. 282 of the Labor Code. One is
analogous to another if it is susceptible of comparison with the latter either in
general or in some specific detail; or has a close relationship with the latter.
Gross Inefficiency is closely related to Gross Neglect, for both involve specific
acts of omission on the part of the employee resulting in damage to the
employer or to his business. In Buiser vs Leogardo, this Court ruled that failure
to observe prescribed standards of work, or to fulfill reasonable work
assignments due to inefficiency may constitute just cause for dismissal.
(Lim vs NLRC, GR# 118434 07/26/96)
3. Authorized Causes
(Labor Code)
ART. 283. Closure of establishment and reduction of personnel. - The
employer may also terminate the employment of any employee due to:
Unless the closing is for the purpose of circumventing the provisions of this Title,
By serving a written notice on the workers and the Ministry of Labor and Employment
at least one (1) month before the intended date thereof.
Unlike the just causes, the authorized causes under this article are not faults of
the employee, they are concomitants [accompanying thing or circumstance] of
business needs or business fate. The business situation makes the employment
termination necessary. Ironically, some employees have to lose their jobs to
strengthen or save the business. In the worse situation the business itself may be
terminated. In any case, the law gives the separated employees separation pay
whose amount varies according to the cause of the separation. But separation pay is
not required if business closure or cessation is due to serious losses.
Similar to the just causes, the authorized causes are coupled with proper
procedure. The process is not by way of investigation and hearing but by a 30-day
notice to the employee and to the DOLE. If this procedure is not observed, the
employer, as in Art. 282 will have to pay full backwages in addition to the statutory
severance pay. This ruling is found in Serrano vs NLRC (GR# 117040 01/27/00)
which modifies the Wenphil Doctrine which imposes only indemnity of an uncertain
amount.
The two most commonly used grounds for termination of employee are the
Authorized Causes under Article 283 and 284 of the Labor Code, and the Just Causes
under Article 282. Below are the authorized causes for termination of employment.
Definition
As maybe broadly defined, authorized causes for dismissal of employee refer to those
lawful grounds for termination which in general do not arise from fault or negligence
of the employee. Authorized causes are distinguished from just causes
under Article 282 in that the latter are always based on acts attributable to the
employees own fault or negligence.
Authorized causes
The authorized causes for termination of employee are enumerated under Article 283
and 284 of the Labor Code, as follows:
It should be noted though that the above enumeration is not an exhaustive list of
authorized causes of termination of employment. Valid application of union
security clause, relocation of business, among others, may also considered
authorized causes of termination.
Footnotes
1. Edge Apparel, Inc. vs. NLRC, G.R. No. 121314, February 12, 1998.
2. Tierra International Construction Corporation vs. NLRC, G.R. No. 88912, July 3,
1992.
3. Alabang Country Club vs. NLRC, G.R. No. 157611, August 9, 2005.
Effects of Termination.
1. If the termination is for authorized cause and the employee is given 30-day
prior notice, the dismissal is valid.
2. If the termination is for authorized cause but the employee was not given 30-
day prior notice, the dismissal is valid but the employer may be ordered to pay
nominal damages to dismissed employee. In Jaka Food Processing vs. Pacot,
2005, the amount of nominal damages is P50,000.00.
3. If the dismissal is not for a valid authorized cause, the dismissal is illegal,
whether or not there is 30-day prior notice. Consequently the employee shall be
entitled to reinstatement and backwages, and damages if warranted.
Separation Pay
In case of termination due to the installation of labor saving devices, the worker
affected thereby shall be entitled to a separation pay equivalent to at least his
one month pay or to at least one month pay for every year of service, whichever
is higher. (Article 283, Labor Code.)
Case
1. An employee was terminated after the company instituted a modernization
program. Under said program, the operations of the quality control unit, to which
said employee was assigned, were all automated. The dismissal was upheld as
valid. (Agustilo vs. Court of Appeals, G.R. No. 142875, September 7, 2001.)
Private respondents harp on the fact that petitioner's desire to save on labor
costs was the motivation for the redundancy program. The law, however, does
not prevent employers from saving on labor costs. This Court has recognized
such right. In International Macleod, Inc. vs IAC, this Court found that the
appointment by the company to the International Heavy Equipment Corporation
as its dealer with the government rendered redundant the position of
Government Relations Officer held by the private respondent therein. It was
held that the determination of the need for the phasing out of a department as
a labor and cost saving device because it was no longer economical to retain
said department is a management prerogative, with which the courts will not
interfere.
b. Redundancy
Redundancy Concept
Redundancy is one of the authorized causes for termination of employment
under Article 283 of the Labor Code of the Philippines.
In Wiltshire, the Court held that an employer has no legal obligation to keep on
the payroll employees more than the number needed for the operation of the
business. (See Wiltshire File Co., v. NLRC, 1991; Coats Manila Bay vs. Ortega,
2009)
Separation Pay
In case of termination due to redundancy, the worker affected thereby shall be
entitled to a separation pay equivalent to at least one (1) month pay or to at least
one (1) month pay for every year of service, whichever is higher.
In redundancy, what is looked into is the position itself, the nature of the services
performed by the employee and the necessity of such position. (Tierra
International Construction Corp. vs. NLRC, 1992)
Cases
1. The employer was engaged in the production of wooden doors and
furniture. The complainants who were hired as mechanics were terminated by
the employer when their positions were abolished, and contracted out to
Gemac Machineries. The dismissal is proper. In contracting the services of
Gemac, which the company has the right to do, the services rendered by the
mechanics became redundant and superfluous, and therefore properly
terminable. (De Ocampo vs. NLRC, G.R. No. 101539 September 4, 1992.)
2. As a result of the phasing-out of the companys security section, and
contracting out the same with an independent contractor, the services of the
complainant as head of the security checkers section, was terminated. The
termination was for an authorized cause, i.e., redundancy. (Serrano vs. NLRC,
G.R. No. 117040. January 27, 2000.)
The appropriate forum to contest the legality or good faith of the retrenchment
or redundancy is the Department of Labor and Employment, not an
investigation or hearing to be held by the employer itself.
(Witshire File Co. Inc. vs NLRC, 193 SCRA 665)
It is the employer who bears the onus of proving compliance with these
requirements, retrenchment and redundancy being in the nature of affirmative
defenses.
(Dole Phils. vs NLRC, GR# 120009 09/13/01)
NOTE:
The reason for including the 4th requisite is based on the principle of security of
tenure. Just because you have a valid ground for dismissal, it should be based
on clear criteria.
Dole's redundancy program does not appear to be tainted with bad faith. The
petition alleges that the redundancy program is part of a wide-scale
restructuring of the company. This purported restructuring is supported by the
company's undisputed history towards these ends, which culminated in the
abolition of certain positions and the Voluntary Resignation Program in 1990-
1991. Among the avowed goals of such restructuring is the reduction of
absenteeism in the company. The harsh economic and political climate then
prevailing in the country also emphasized the need for cost-saving measures.
Reorganization as a cost-saving device is acknowledged by jurisprudence. An
employer is not precluded from adopting a new policy conducive to a more
economical and effective management, and the law does not require that the
employer should be suffering financial losses before he can terminate the
services of the employee on the ground of redundancy.
(Dole Phils. vs NLRC, GR# 120009 09/13/01)
Retrenchment Concept
Retrenchment is an economic ground to reduce the number of employees. It is
the reduction of personnel for the purpose of cutting down on costs of operations
in terms of salaries and wages resorted to by an employer because of losses in
operation of a business occasioned by lack of work and considerable reduction in
the volume of business (See Alabang Country Club vs. NLRC, G.R. No. 157611,
August 9, 2005 ).
Not every loss incurred or expected to be incurred by the employer will justify
retrenchment, since, in the nature of things, the possibility of incurring losses is
constantly present, in greater or lesser degree, in carrying on the business
operations. (See Edge Apparel Inc. vs. NLRC, G.R. No. 121314, February 12,
1998 .)
The following are the general standards to determine whether the business losses
sought to be prevented are serious, actual and real, and sufficient to justify
retrenchment of employees:
1. The losses expected should be substantial and not merely de
minimis in extent;
2. The losses apprehended must be reasonably imminent;
3. The alleged losses if already realized, and the expected imminent
losses sought to be forestalled, must be proven by sufficient and convincing
evidence. (See Lopez Sugar Corporation case.)
Separation Pay
In case of retrenchment to prevent losses, the separation pay shall be equivalent
to one month pay or at least one-half month pay for every year of service,
whichever is higher. A fraction of at least six months shall be considered one
whole year. (Article 283, LC.)
To remedy this situation, the Court has applied by analogy Art. 286 to set a
specific period that employees may remain temporarily laid, or, sometimes
referred to as in floating status. (See Sebuguero vs. NLRC, G.R. No. 115394
September 27, 1995.) Article 286 provides:
Article 286. When employment not deemed terminated. The bonafide suspension
of the operation of a business or undertaking for a period not exceeding six
months, or the fulfillment by theemployee of a military or civic duty shall not
terminate employment. In all such cases, the employer shall reinstate the
employee to his former position without loss of seniority rights if he indicates his
desire to resume his work not later than one month from the resumption of
operations of his employer or from his relief from the military or civic duty.
Firstly, the losses expected should be substantial and not merely de minimis in
extent. If the loss purportedly sought to be forestalled by retrenchment is
clearly shown to be insubstantial and inconsequential in character, the bona
fide nature of the retrenchment would appear to be seriously in question.
Lastly, but certainly not the least important, alleged losses if already realized,
and the expected imminent losses sought to be forestalled, must be proved by
sufficient and convincing evidence. The reason for requiring this quantum of
proof is readily apparent: any less exacting standard of proof would render too
easy the abuse of this ground for termination of services of employees.
(EMCO Plywood Corp. vs Ablegas, GR# 04/14/04)
The CA committed no reversible error in affirming the NLRC ruling that Talam
was validly dismissed on the ground of retrenchment. The Supreme Court came
to this conclusion based on the following considerations:
First, the decision to retrench had a basis; it was not simulated nor resorted to
for the purpose of getting rid of employees. The decision was upon the
recommendation of the companys external auditor.
Fourth, TSFI resorted to other measures to abate its losses. It claimed that
during the crises period, it used as an office a small-room (a mere cubicle) with
only a two-person support staff in the persons of Grapilon and Hermle; it
reduced the salaries of its employees by as much as 30%. This submission by
the company is substantiated by the schedule of Operating Expenses for the
year ended December 31, 2002 and September 30, 2002. A quick glance at the
schedule readily shows a reduction of TSFIs operating expenses across the
board. The schedule indicates a substantial decrease in operating expenses,
from P5,733,735.00 in September 2002 to P1,698,552.36 as of the end of
December 2002.
(Talam vs NLRC, GR# 175040 04/06/10)
For his part, petitioner insists that actual, not probable losses, justify
retrenchment. Art. 283 of the Labor Code entails, among others, only a situation
where there is "retrenchment to prevent losses". The phrase "to prevent losses"
means that retrenchment or termination from the service of some employees is
authorized to be undertaken by the employer sometime before the losses
anticipated are actually sustained or realized. This is the situation in the case at
bar. Evidently, actual losses need not set in prior to retrenchment.
(Cajucom VII vs TPI Phils. Cement Corp., GR# 149090 02/11/05)
(2) the employer serves written notice both to the employee/s concerned and
the Department of Labor and Employment at least a month before the
intended date of retrenchment;
(3) the employer pays the retrenched employee separation pay in an amount
prescribed by the Code;
(4) the employer exercises its prerogative to retrench in good faith; and
(5) the employer uses fair and reasonable criteria in ascertaining who would be
retrenched or retained.
The losses must be supported by sufficient and convincing evidence, the normal
method of discharging which is the submission of financial statements duly
audited by independent external auditors.
In the case at bar, petitioner justifies the downsizing scheme on the ground of
serious business losses it suffered in 2001. Some positions had to be declared
redundant to cut losses. In this context, what may technically be considered as
redundancy may verily be considered as a retrenchment measure.
Good faith in retrenchment, can be shown through the financial statements, and
also by showing that other cost saving measures have been availed of first
before retrenchment can be allowed.
In Mac Adams Metal case, the court reiterated viz. Just as no law forces anyone
to go into business, no law can compel anybody to continue in it. It would indeed
be stretching the intent and spirit of the law if we were to unjustly interfere with
the managements prerogative to close or cease its business operations just
because said business operation or undertaking is not suffering from any loss or
simply to provide the workers continued employment.
In Maya Farms Employees Organization vs. NLRC, 1994, the Court held that even
if the employer is not suffering from business losses, it can still resort to closure
of business as long as the companys exercise of the same is done in good faith
to advance its interest and not for the purpose of defeating or circumventing the
rights of employees under the law or a valid agreement such exercise will be
upheld.
Separation Pay
In case of retrenchment and closures not due to serious financial reverses, the
employee shall be entitled to separation pay equivalent to one month pay or at
least one-half month pay for every year of service, whichever is higher.
If the closure is due to business losses, there is no obligation on the part of the
employer to pay separation benefits to employees.
Cases
1. The company terminated its employees when its plant was relocated
from Makati to Batangas. The relocation was in view of the expiration of the
lease contract on the premises it occupied in Makati and the refusal of the
lessor to renew the same. The termination was for authorized cause as there
was cessation of the companys operations in Makati. (Cheniver Deco vs.
NLRC, G.R. No. 122876, February 17, 2000.)
2. The closure of business by the owner after she became sickly and her
health did not improve despite proper medical attention, was affirmed as valid
as it was done in good faith although the business was not undergoing
economic losses. (Mac Adams Union vs. Mac Adams, G.R. No. 141615, October
24, 2003.)
Article 283 of the Labor Code does not obligate an employer to pay separation
benefits when the closure is due to losses.
What is contemplated in Art. 283 is closure due to serious losses, and not
closure due to management prerogative.
If the closure is due to Management Prerogative, then separation pay should be
awarded.
(North Davao Mining vs NLRC, 254 SCRA 721)
- MONETARY AWARD
Corporate directors and officers are solidarily liable with the corporation for the
termination of employees done with malice or bad faith.
(Mandaue Dinhow Dimsum House vs NLRC, GR# 161134 03/03/08)
In the case at bar, petitioner paid respondents the following: (a) separation pay
computed at 150% of their gross monthly pay per year of service; and (b) cash
equivalent of earned and accrued vacation and sick leaves. Clearly, petitioner
had gone over and above the requirements of the law. Despite this, however,
the Labor Arbiter ordered petitioner to pay respondents an additional amount,
equivalent to one months salary, as a form of financial assistance.
The award of financial assistance is bereft of legal basis and serves to penalize
petitioner who had complied with the requirements of the law. The Court also
point out that petitioner may, as it has done, grant on a voluntary and ex gratia
basis, any amount more than what is required by the law, but to insist that
more financial assistance be given is certainly something that the Court cannot
countenance. Moreover, any award of additional financial assistance to
respondents would put them at an advantage and in a better position than the
rest of their co-employees who similarly lost their employment because of
petitioners decision to cease its operations.
(Solidbank Corp. vs NLRC, GR# 165951 03/30/10)
It is not disputed that the LIFO rule applies to termination of employment in the
line of work. Verily, what is contemplated in the LIFO rule is that when there are
two or more employees occupying the same position in the company affected
by the retrenchment program, the last one employed will necessarily be the
first to go.
(Maya Farms vs NLRC, GR# 106256 12/28/94)
For termination of employment as defined in Art. 283 of the Labor Code, the
requirement of due process shall be deemed complied with upon service of a
written notice to the employee and the appropriate Regional Office of the
Department of Labor and Employment at least 30 days before effectivity of
the termination, specifying the ground or grounds for termination.
4. Disease
(Labor Code)
ART. 284. Disease as ground for termination. - An employer may terminate the
services of an employee who has been found to be suffering from any disease and
whose continued employment is prohibited by law or is prejudicial to his health as
well as to the health of his co-employees: Provided, That he is paid separation pay
equivalent to at least one (1) month salary or to one-half (1/2) month salary for every
year of service, whichever is greater, a fraction of at least six (6) months being
considered as one (1) whole year.
Requisites:
1) The disease is incurable within 6 months and the continued employment of
the employee is prohibited by law or prejudicial to his health as well as to the
health of his co-employee;
2) With a certification from a competent authority (such as public health officer)
that the disease is incurable within 6 months despite due medication and
treatment.
Nota Bene:
Termination of services must be effected only upon compliance
with the above requisite; otherwise, in the absence of the required certification by
a competent public health officer, the court will rule against the validity of the
employees dismissal.
(Viola Cruz vs. NLRC, GR# 116384 02/07/00)
The requirement for a medical certificate under Article 284 of
the Labor Code cannot be dispensed with, otherwise, it would sanction the
unilateral and arbitrary determination by the employer of the gravity or extent of
the employees illness and thus defeat the public policy in the protection of labor.
(Sy, et al vs. CA, February 27, 2003)
Discrimination in any form from pre-employment to post-
employment, including hiring, promotion or assignment, based on the actual,
perceived or suspected HIV status of an individual is prohibited. Termination from
work on the sole basis of actual, perceived or suspected HIV status is deemed
unlawful.
(Sec.35, R.A. 8504, HIV/AIDS LAW)
Certification in Cebu is issued by the Department of Health and
other government hospitals such as the Vicente Sotto Memorial Hospital, CCMC,
etc.
The certification is to be secured by the employer. The burden
rests upon the employer to secure a certification.
(Tan vs. NLRC)
An employer may terminate the services of his employees who has been found to
be suffering from a disease when the latter's continued employment is prohibited
by law or is prejudicial to his health as well as to the health of his co-employees.
However, the dismissal may not be summarily carried out. The employer must
comply with certain prerequisites contained in Sec. 8, Rule I, Book VI, of the
Omnibus Rules Implementing the Labor Code, which states -- Where the employee
suffers from a disease and his continued employment is prohibited by law or
prejudicial to his health or to the health of his co-employees, the employer shall not
terminate his employment unless there is certification by a competent public health
authority that the disease is of such nature or at such a stage that it cannot be
cured within a period of six (6) months even with proper medical treatment. If the
disease or ailment can be cured within the period, the employer shall not terminate
the employee but shall ask the employee to take a leave. The employer shall
reinstate such employee to his former position immediately upon the restoration of
his normal health.
(ATCI Overseas Corp. vs CA, GR# 143949 08/09/01)
5. Retirement
(Labor Code)
ART. 287. Retirement. - Any employee may be retired upon reaching the
retirement age established in the collective bargaining agreement or other applicable
employment contract.
Unless the parties provide for broader inclusions, the term one-half (1/2) month
salary shall mean fifteen (15) days plus one-twelfth (1/12) of the 13th month pay
and the cash equivalent of not more than five (5) days of service incentive leaves.
An underground mining employee upon reaching the age of fifty (50) years or more,
but not beyond sixty (60) years which is hereby declared the compulsory retirement
age for underground mine workers, who has served at least five (5) years as
underground mine worker, may retire and shall be entitled to all the retirement
benefits provided for in this Article.
Nothing in this Article shall deprive any employee of benefits to which he be entitled
under existing laws or company policies or practices. (As amended by RA 7641, and
RA 8553, February 26, 1998)
NOTE:
The Retirement Pay Law applies to all employees in the private sector, regardless of
their position, designation or status and irrespective of the method by which their
wages are paid, except those specifically exempted. It also includes and covers part-
time employees, employees of service and other job contractors and domestic
helpers or persons in the personal service of another. chanrobles virtual law library
Who are the employees not covered by the Retirement Pay Law?
The Retirement Pay Law does not apply to the following employees:
1. Employees of the National Government and its political subdivisions, including
government-owned and/or controlled corporations, if they are covered by the Civil
Service Law and its regulations.
Any employee may retire or be retired by his employer upon reaching the retirement
age established in the CBA or other applicable employment contract and he shall be
entitled to the benefits thereunder. If the amount is less than those provided under
the law, the employer shall pay the difference.
Article 287 of the Labor Code, as amended by Republic Act No. 7641, provides for
two (2) types of retirement: (a) optional; and (b) compulsory.
Yes. The decision of the Supreme Court in the case of PAL vs. ALPAP. (G.R.
No.143686, January 15, 2002), is instructive:
Finally, on the issue of whether petitioner should consult the pilot concerned before
exercising its option to retire pilots, we rule that this added requirement, in effect,
amended the terms of Article VII, Section 2 of the 1976 PAL-ALPAP Retirement Plan.
The option of an employer to retire its employees is recognized as valid.
Surely, the requirement to consult the pilots prior to their retirement defeats the
exercise by management of its option to retire the said employees. It gives the pilot
concerned an undue prerogative to assail the decision of management. Due process
only requires that notice be given to the pilot of petitioner's decision to retire him.
Hence, the Secretary of Labor overstepped the boundaries of reason and fairness
when he imposed on petitioner the additional requirement of consulting each pilot
prior to retiring him.
Furthermore, when the Secretary of Labor and Employment imposed the added
requirement that petitioner should consult its pilots prior to retirement, he resolved a
question which was outside of the issues raised, thereby depriving petitioner an
opportunity to be heard on this point.
The law recognizes as valid any retirement plan, agreement or management policy
regarding retirement at an earlier or older age.
What are included in the retirement benefits under the Retirement Pay
Law?
Retirement benefits.
2. One-half (1/2) month salary, components. - For the purpose of determining the
minimum retirement pay due an employee, the term one-half month salary shall
include all the following:
(a) fifteen (15) days salary of the employee based on his latest salary rate.
(b) the cash equivalent of five (5) days of service incentive leave;
(c) one-twelfth (1/12) of the 13th month pay due the employee; and
(d) all other benefits that the employer and employee may agree upon that should be
included in the computation of the employees retirement pay.
3. One-half monthly salary of employees who are paid by results. - For covered
workers who are paid by results and do not have a fixed monthly rate, the basis for
determination of the salary for fifteen (15) days shall be their average daily salary
(ADS).
As provided in R. A. No. 7742, a private employer shall have the option to treat the
coverage of the Pag-IBIG Fund as a substitute retirement benefit for the employee
concerned within the purview of the Labor Code as amended; provided such option
does not in any way contravene an existing collective bargaining agreement or other
employment agreement.
Thus, the Pag-IBIG Fund can be considered as a substitute retirement plan of the
company for its employees provided that such scheme offers benefits which are more
than or at least equal to the benefits under Republic Act No. 7641. If said scheme
provides for less than what the employee is entitled to under Republic Act No. 7641,
the employer is liable to pay the difference.
What is the latest amendment to the Retirement Pay Law (Article 287 of
the Labor Code)?
The latest amendment to Article 287 of the Labor Code was introduced by Republic
Act No. 8558 [An Act Amending Article 287 of Presidential Decree No. 442, as
Amended, Otherwise Known as the Labor Code of the Philippines by Reducing the
Retirement Age of Underground Mine Workers from Sixty (60) to Fifty (50)] which was
approved on February 26, 1998.
Dismissal, on the other hand, refers to the unilateral act of the employer in
terminating the services of an employee with or without cause. (Gamogamo vs. PNOC
Shipping and Transport Corp., G. R. No. 141707, May 7, 2002).
Dismissal for cause, effect on entitlement to retirement benefits.
However, in the 2002 case of San Miguel Corporation vs. Lao, [G. R. No. 143136-37,
July 11, 2002], an employee who was dismissed for cause was held not entitled to the
retirement benefits under the companys retirement plan which concededly prohibits
the award of retirement benefits to an employee dismissed for a just cause, a
proscription that binds the parties to it.
Distinguishing Razon from San Miguel, the Supreme Court ruled that in Razon, the
employers refusal to give the employee his retirement benefits is based on the
provision of the retirement plan giving management wide discretion to grant or not to
grant retirement benefits, a prerogative that obviously cannot be exercised arbitrarily
or whimsically. But in San Miguel, the retirement plan expressly prohibits the grant of
retirement benefits in case of dismissal for cause. Hence, the employee is bound by
such prohibition.
1. Retirement pay differs from separation pay in that the former is paid by reason of
retirement; while the latter is required in the cases enumerated in Articles 283 and
284 of the Labor Code.
2. The purpose for the grant of retirement pay is to help the employee enjoy the
remaining years of his life thereby lessening the burden of worrying for his financial
support. It is also a form of reward for the employees loyalty and service to the
employer. Separation pay, on the other hand, is designed as a wherewithal during
the period that an employee is looking for another employment after his termination.
As a general rule, retiring employees are entitled only to retirement benefits. But
there are instances when separation pay and retirement pay must both be paid to
the employee. The reason is, the separation pay is mandated by law; while
retirement pay is required by contract.
Cases where both separation pay and retirement pay must be paid.
In the case of University of the East vs. Hon. Minister of Labor, [G. R. No. 74007, July
31, 1987], the school claimed that teachers who were terminated because of phased-
out units cannot be considered retired and, therefore, entitled to retirement benefits
and, at the same time, retrenched, which would entitle them to separation pay. This
would be tantamount to enriching them at the expense of the school. The Supreme
Court, however, ruled that separation pay arising from a forced termination of
employment and retirement benefits given as a contractual right to the teachers for
many years of faithful service, are not necessarily antagonistic to each other.
Moreover, the retirement scheme has become part of the schools policy and,
therefore, it should be enforced separately from the provision of the Labor Code.
Consequently, the teachers were ordered paid for both retirement pay and
separation pay.
In another case, Aquino vs. NLRC, [G. R. No. 87653, February 11, 1992; See also BLTB
vs. CA, 71 SCRA 470 (1976)], the Supreme Court ordered the payment of both the
separation pay for retrenchment embodied in the CBA as well as the retirement pay
provided under a separate Retirement Plan to the retrenched employees. The
argument of the company that it has more than complied with the mandate of the
law on retrenchment by paying separation pay double that required by the Labor
Code (at the rate of one month pay instead of the one-half month pay per year of
service) was not favorably taken into account by the Supreme Court because the
employees were not pleading for generosity but demanding their rights embodied in
the CBA which was the result of negotiations between the company and the
employees.
On the issue of mutual exclusivity of the CBA-mandated separation pay in case of
retrenchment, on the one hand, and the retirement benefits provided in the
Retirement Plan, on the other, the Supreme Court in this case of Aquino opined that:
The Court feels that if the private respondent (company) really intended to make
the separation pay and the retirement benefits mutually exclusive, it should have
sought inclusion of the corresponding provision in the Retirement Plan and the
Collective Bargaining Agreement so as to remove all possible ambiguity regarding
this matter.
We may presume that the counsel of the respondent company was aware of the
prevailing doctrine embodied in the cases earlier cited. Knowing this, he should have
made it a point to categorically provide in the Retirement Plan and the CBA that an
employee who had received separation pay would no longer be entitled to retirement
benefits. Or to put it more plainly, collection of retirement benefits was prohibited if
the employee had already received separation pay. (See also Batangas Laguna
Tayabas Bus Co. vs. Court of Appeals, G.R. No L-38482, June 18, 1976, 71 SCRA 470).
In Bongar vs. NLRC, [G. R. No. 107234, August 24, 1998], the Supreme Court ordered
the payment not only of separation pay and backwages to an illegally dismissed
teacher but additionally, of the retirement benefits pursuant to any collective
bargaining agreement in the workplace or, in the absence thereof, as provided in
Section 14 [Retirement Benefits], Book VI of the Implementing Rules of the Labor
Code.
In Ford Philippines Salaried Employees Association vs. NLRC, [G. R. No. 75347, Dec.
11, 1987], a case decided before the advent of Republic Act No. 7641, the Supreme
Court ruled that if it is provided in the Retirement Plan of the company that the
retirement, death and disability benefits paid in the plan are considered integrated
with and in lieu of termination benefits under the Labor Code, then the retirement
fund may be validly used to pay such termination or separation pay because of
closure of business.
In Cipriano vs. San Miguel Corporation, [G. R. No. L-24774, August 21, 1968], it was
ruled that in case the Retirement Plan of the company provides that the employee
shall be entitled to either the retirement benefit provided therein or to the separation
pay provided by law, whichever is higher, the employee cannot be entitled to both
benefits. Article X of said Retirement Plan reads:
Regular employees who are separated from the service of the company for any
reason other than misconduct or voluntary resignation shall be entitled to either
100% of the benefits provided in Section 2, Article VIII hereof, regardless of their
length of service in the company or to the severance pay provided by law, whichever
is the greater amount.
In the 2004 case of Cruz vs. Philippine Global Communications, Inc., [G. R. No.
141868, May 28, 2004], the Supreme Court reiterated the said rule in Cipriano
[supra] under the following provision in the Retirement Plan which states:
b)Adjustment of Benefits Payments.- x x x, in the event the Company is required
under the law or by lawful order of competent authority to pay to the Member
benefits or emoluments similar or analogous to those already provided in the Plan,
the Member concerned shall not be entitled to both what the law or the lawful order
of competent authority requires the Company to give and the benefits provided by
the Plan, but shall only be entitled to whichever is the greatest among them, x x x.
(Section 6 (b), Article XI of the Retirement Plan).
The employees in this case who were terminated due to closure of the companys
branches, are entitled only to either the separation pay provided under Article 283 of
the Labor Code, as amended, or retirement benefits prescribed by the Retirement
Plan, whichever is higher. Consequently, they were paid separation benefits
computed under the Retirement Plan, the same being higher than what Article 283
provides.
In the 2005 case of Salomon vs. Association of International Shipping Lines, Inc., [G.
R. No. 156317, April 26, 2005], petitioners who were duly paid separation pay when
they were retrenched, claimed that they are, in addition, entitled to retirement
benefits under the CBA citing the Aquino case [supra] as basis. Said CBA provides,
thus:
Section 1. In case of termination due to redundancy, retrenchment, dissolution of
a department/ conference/section and/or the whole ASSOCIATION, sickness or
physical disability, a regular employee shall be entitled to a separation pay
equivalent to his one (1) month basic pay for every year of service. A fraction of at
least six (6) months shall be considered as one (1) whole year and less than six (6)
months shall be prorated accordingly.
a. 15 to less than 20 years of service 50% of the monthly basic salary for every year
of service.
b. 20 years of service 100% of the monthly basic salary for every year of service.
As held in Cipriano [supra] and Aquino [supra], the employees right to payment of
retirement benefits and/or separation pay is governed by the Retirement Plan of the
parties. The provisions of the Retirement Plan are controlling in determining such
entitlement. (Cruz vs. Philippine Global Communications, Inc., supra).
In other words, if the Retirement Plan mandates that the employees who are
separated under any of the authorized causes under Article 283 of the Labor Code
are entitled to both the separation pay provided therein as well as the retirement
benefits under the Retirement Plan, then, they shall be so paid. Otherwise, if the
Retirement Plan says that the employees shall be entitled to either the separation
pay under the said provision of the law or the retirement benefits under the
Retirement Plan, whichever is higher, then, they should not be allowed to claim both.
Clearly, under the above cases, the right of the concerned employees to receive both
retirement benefits and separation pay depends upon the provisions in the
Retirement Plan. (Ibid.).
Forced retirement.
In San Miguel Corporation vs. NLRC, [G. R. No. 107693, July 23, 1998], the employees
were given the option to retire, be retrenched or dismissed but they were made to
understand that they had no choice but to leave the company. It was in reality a
Hobsons choice which means that they have no choice at all. All that the private
respondents were offered was a choice on the means or method of terminating their
services but never as to the status of their employment. In short, they were never
asked if they still wanted to work for petitioner. The mere absence of actual physical
force to compel private respondents to ink an application for retirement did not make
their retirement voluntary. Confronted with the danger of being jobless, unable to
provide their families even with the basic needs or necessities of life, the private
respondents had no choice but to sign the documents proffered to them. But neither
their receipt of separation pay nor their negotiating for more monetary benefits
estopped private respondents from questioning and challenging the legality of the
nature or cause of their separation from the service.
In Villena vs. NLRC, [G. R. No. 90664, Feb. 7, 1991], an employee whose age was 57
when he was illegally singled out for retirement, after serving the bus company since
he was 25 years old, was declared to be entitled to his full backwages, allowances
and other benefits for a period of three (3) years after his illegal dismissal from the
service until he reached the compulsory retirement age, plus his retirement benefits
equivalent to his gross monthly pay, allowances and other benefits for every year of
service up to age sixty (60) which is the normal retirement age for him.
In the 2004 case of Piero vs. NLRC, [G. R. NO. 149610, August 20, 2004], the
petitioner employee who turned 60 years old and retired on March 1, 1996 after 29
years of service was declared not entitled to the payment of retirement benefits
because he lost his employment status effective as of the date of the decision of the
Labor Arbiter on October 28, 2004 which declared as legal the termination of his
employment as a consequence of an illegal strike. At that time, his employer refused
to pay his retirement benefits pending the final resolution of the case. Instead, the
Supreme Court, on ground of equity for his long years of service without any
derogatory record, awarded him financial assistance equivalent to one-half ()
months pay for every year of service computed from his date of employment up to
October 28, 1994 when he was declared to have lost his employment status.
Is the retirement pay under the SSS similar to or may be a substitute for
the retirement pay under the Labor Code?
The employees retirement pay under Article 287 of the Labor Code or under a
unilaterally promulgated retirement policy or plan of the employer or under a
Collective Bargaining Agreement, is separate and distinct from the retirement
benefits granted under Republic Act No. 8282, otherwise known as the Social
Security Act of 1997.
The opening paragraph of Article 287 clearly enunciates the intent and application of
the law. It conveys in clear and unmistakable terms that once an employee retires, it
is not Article 287 that is controlling but the retirement plan under the CBA or other
applicable employment contract. Article 287 becomes relevant only in the matter of
ensuring that the retirement benefits are not less than those provided therein.
This explains why, in the third paragraph of Article 287, it is further underscored that
the retirement package provided therein is made applicable only in the absence of a
retirement plan or agreement providing for retirement benefits of employees in the
establishment.
In case of retirement under the CBA or other applicable employment contract, the
employee is entitled to receive such retirement benefits as he may have earned
under existing laws, the CBA and other agreements; provided that such retirement
benefits under the CBA or other agreements should not, in any way, be less than
those provided under the law. In the event that such benefits are less, the employer
is obligated to pay the difference between the amount due the employee under the
law and that provided under the CBA or other applicable employment contract.
(Sections 3.1 and 3.2, Rule II, Ibid.).
This is best illustrated in the 2001 case of Manuel L. Quezon University vs. NLRC, [G.
R. No. 141673, October 17, 2001]. the issue raised is whether respondent-teachers
are entitled to the retirement benefits provided for under Republic Act No. 7641,
even if the petitioner has an existing valid retirement plan. The Supreme Court ruled
that they are so entitled. Republic Act No. 7641 intends to give the minimum
retirement benefits to employees not entitled thereto under collective bargaining and
other agreements. Its coverage applies to establishments with existing collective
bargaining or other agreements or voluntary retirement plans whose benefits are less
than those prescribed under the proviso in question. Consequently, petitioner
University was ordered to pay the teachers their retirement differential pay (i.e., the
difference between the retirement pay under R. A. No. 7641 and the MLQU
Retirement Plan) plus legal interest of six percent (6%) per annum from the date of
filing of their complaints on March 27, 1997 up to actual payment.
If after applying Article 287, however, it is clear that the retirement plan under the
CBA or other agreements, company policy or practice provides for retirement
benefits which are equal or superior to that which is provided in said law, then, such
retirement plan and not Article 287, should prevail and thus govern the computation
of the benefits to be awarded. (Labor Advisory on Retirement Pay Law dated Oct. 24,
1996, issued by Secretary Leonardo A. Quisumbing).
The best case to exemplify this point is the 2002 case of Philippine Airlines, Inc. vs.
Airline Pilots Association of the Philippines, [G. R. No. 143686, January 15, 2002],
where the Supreme Court had occasion to comment on the following pertinent
provision of the 1967 PAL-ALPAP Retirement Plan:
SECTION 1. Normal Retirement. (a) Any member who completed twenty (20) years
of service as a pilot for PAL or has flown 20,000 hours for PAL shall be eligible for
normal retirement. The normal retirement date is the date on which he completes
twenty (20) years of service, or on which he logs his 20,000 hours as a pilot for PAL.
The member who retires on his normal retirement shall be entitled to either (a) a
lump sum payment of P100,000.00 or (b) to such termination pay benefits to which
he may be entitled to under existing laws, whichever is the greater amount.
A pilot who retires after twenty years of service or after flying 20,000 hours would
still be in the prime of his life and at the peak of his career, compared to one who
retires at the age of 60 years old. Based on this peculiar circumstance that PAL pilots
are in, the parties provided for a special scheme of retirement different from that
contemplated in the Labor Code. Conversely, the provisions of Article 287 of the
Labor Code could not have contemplated the situation of PALs pilots. Rather, it was
intended for those who have no more plans of employment after retirement, and are
thus in need of financial assistance and reward for the years that they have rendered
service.
In any event, petitioner contends that its pilots who retire below the retirement age
of 60 years not only receive the benefits under the 1967 PAL-ALPAP Retirement Plan
but also an equity of the retirement fund under the PAL Pilots Retirement Benefit
Plan, entered into between petitioner and respondent on May 30, 1972.
The PAL Pilots Retirement Benefit Plan is a retirement fund raised from contributions
exclusively from petitioner of amounts equivalent to 20% of each pilots gross
monthly pay. Upon retirement, each pilot stands to receive the full amount of the
contribution. In sum, therefore, the pilot gets an amount equivalent to 240% of his
gross monthly income for every year of service he rendered to petitioner. This is in
addition to the amount of not less than P100,000.00 that he shall receive under the
1967 Retirement Plan. In short, the retirement benefits that a pilot would get under
the provisions of Article 287 of the Labor Code are less than those that he would get
under the applicable retirement plans of petitioner. (Ibid.).
Indeed, Article 287 makes clear the intention and spirit of the law to give employers
and employees a free hand to determine and agree upon the terms and conditions of
retirement. The law presumes that employees know what they want and what is
good for them absent any showing that fraud or intimidation was employed to secure
their consent thereto. (Pantranco North Express, Inc. vs. NLRC, G. R. No. 95940, July
24, 1996, 259 SCRA 161).
Compulsory retirement takes place at age 65, while optional retirement is primarily
determined by the CBA or other employment contract or employers retirement plan.
In the absence of any provision on optional retirement in a CBA, other employment
contract, or employers retirement plan, an employee may optionally retire upon
reaching the age of 60 years or more, but not beyond 65 years, provided he has
served at least five (5) years in the establishment concerned. That prerogative is
exclusively lodged in the employee.
Thus, in Capili vs. NLRC, [G. R. No. 120802, June 17, 1997, 273 SCRA 576], it was
held that the act of accepting the retirement benefits is deemed an exercise of the
option to retire under the third paragraph of Article 287, as amended by Republic Act
No. 7641. Thereunder, he could choose to retire upon reaching the age of 60 years,
provided it is before reaching 65 years which is the compulsory age of retirement.
(Capili vs. NLRC, G. R. No. 120802, June 17, 1997, 273 SCRA 576).
The answer to this query is, of course, in the affirmative. If there is a provision on
retirement in a CBA or any other agreement or if the employer has a retirement plan,
the option may be exercised by the employer in accordance therewith. Article 287 is
clear: (a)ny employee may be retired upon reaching the retirement age established
in the collective bargaining agreement or other applicable employment contract.
In Philippine Airlines, Inc. vs. Airline Pilots Association of the Philippines, [G. R. No.
143686, January 15, 2002], an issue was raised on whether petitioner should consult
the pilot concerned before exercising its option to retire pilots. The Supreme Court
ruled in the negative. It held that this constitutes an added requirement which, in
effect, amended the terms of Article VII, Section 2 of the 1976 PAL-ALPAP Retirement
Plan which states:
SECTION 2. Late Retirement. Any member who remains in the service of the
Company after his normal retirement date may retire either at his option or at the
option of the Company and when so retired he shall be entitled either (a) to a lump
sum payment of P5,000.00 for each completed year of service rendered as a pilot, or
(b) to such termination pay benefits to which he may be entitled under existing laws,
whichever is the greater amount.
Surely, the requirement to consult the pilots prior to their retirement defeats the
exercise by management of its option to retire the said employees. It gives the pilot
concerned an undue prerogative to assail the decision of management. Due process
only requires that notice be given to the pilot of petitioners decision to retire him.
In the 2000 case of Progressive Development Corporation vs. NLRC, [G. R. No.
138826, October 30, 2000], the optional retirement provision of the Employees Non-
Contributory Retirement Plan states:
Section 3. Optional Retirement. - Any participant with twenty (20) years of service,
regardless of age, may be retired at his option or at the option of the Company and
shall be entitled to the following benefits x x x.
In Pantranco North Express, Inc. vs. NLRC, [G. R. No. 95940, July 24, 1996, 259 SCRA
161], it was ruled that an employee who was compulsorily retired after rendering 25
years of service in accordance with the provision of the CBA cannot claim that he was
illegally dismissed. Providing in a CBA for compulsory retirement of employees after
25 years of service is legal and enforceable so long as the parties agree to be
governed by such CBA.
In the earlier case of Bulletin Publishing Corp. vs. Sanchez, [144 SCRA 628 (1986)],
the Supreme Court held:
The aforestated sections explicitly declare, in no uncertain terms, that retirement of
an employee may be done upon initiative and option of the management. And where
there are cases of voluntary retirement, the same is effective only upon the approval
of management. The fact that there are some supervisory employees who have not
yet been retired after 25 years with the company or have reached the age of sixty
merely confirms that it is the singular prerogative of management, at its option, to
retire supervisors or rank-and-file members when it deems fit. There should be no
unfair labor practice committed by management if the retirement of private
respondents were made in accord with the agreed option. That there were numerous
instances wherein management exercised its option to retire employees pursuant to
the aforementioned provisions, appears to be a fact which private respondents have
not controverted. It seems only now when the question of the legality of a
supervisors union has arisen that private respondents attempt to inject the dubious
theory that the private respondents are entitled to form a union or go on strike
because there is allegedly no retirement policy provided for their benefit. As above
noted, this assertion does not appear to have any factual basis.
The decision of the Supreme Court in the 2003 case of Sta. Catalina College vs.
NLRC, [G. R. No. 144483, November 19, 2003] is instructive on the issue of
interruption in the service. In this case, the teacher was hired by the Sta. Catalina
College in June 1955 as an elementary school teacher. In 1970, she applied for and
was granted a one-year leave of absence without pay on account of the illness of her
mother. After the expiration in 1971 of her leave of absence, she had not been heard
from by petitioner school. In the meantime, she was employed as a teacher in
another school - the San Pedro Parochial School during school year 1980-1981 and
later, at the Liceo de San Pedro, Bian, Laguna during school year 1981-1982. In
1982, she applied anew at petitioner school which hired her. In 1997, the teacher
reached compulsory retirement age. The threshold issue is whether the teachers
services for petitioner school during the period from 1955 to 1970 should be factored
in the computation of her retirement benefits
The Supreme Court ruled that she cannot be credited for her services in 1955-1970 in
the determination of her retirement benefits. For, after her one year leave of
absence expired in 1971 without her requesting for extension thereof as in fact she
had not been heard from until she resurfaced in 1982 when she reapplied with
petitioner school, she abandoned her teaching position as in fact she was employed
elsewhere in the interim and effectively relinquished the retirement benefits
accumulated during the said period. As the teacher was considered a new employee
when she rejoined petitioner school upon re-applying in 1982, her retirement benefits
should thus be computed only on the basis of her years of service from 1982 to
1997.
In the 2002 case of Gamogamo vs. PNOC Shipping and Transport Corp., [G. R. No.
141707, May 7, 2002], it was held that since the retirement pay solely comes from
respondent companys funds, it is but natural that respondent should disregard
petitioner-employees length of service in another company for the computation of
his retirement benefits.
Petitioner in Gamogamo was first employed with the Department of Health (DOH)
and remained employed as dentist at the DOH for fourteen (14) years until he
resigned on November 2, 1977. On November 9, 1977, petitioner was hired as
company dentist by Luzon Stevedoring Corporation (LUSTEVECO), a private domestic
corporation. Subsequently, respondent PNOC Shipping and Transport Corporation
(hereafter respondent) acquired and took over the shipping business of LUSTEVECO,
and on August 1, 1979, petitioner was among those who opted to be absorbed by the
respondent. Thus, he continued to work as company dentist. Ordinarily, his creditable
service should be reckoned from such date. However, since respondent took over the
shipping business of LUSTEVECO and agreed to assume without interruption all the
service credits of petitioner with LUSTEVECO, petitioners creditable service must
start from November 9, 1977 when he started working with LUSTEVECO until his day
of retirement on April 1, 1995. Thus, petitioners creditable service is 17.3333 years.
Petitioners contention cannot be upheld that his fourteen (14) years of service with
the DOH should be considered because his last two employers were government-
owned and controlled corporations, and fall under the Civil Service Law.
It is not at all disputed that while respondent and LUSTEVECO are government-owned
and controlled corporations, they have no original charters; hence they are not under
the Civil Service Law. In any case, petitioners fourteen years of service with the
DOH may not remain uncompensated because it may be recognized by the GSIS
pursuant to Section 12 of Presidential Decree No, 1146, as amended, otherwise
known as the Government Service Insurance Act of 1977, as may be determined by
the GSIS.
To dispel any further confusion on the meaning of one-half [] month salary in the
law, the Supreme Court, in the case of Capitol Wireless, Inc. vs. Confesor, [G. R. No.
117174, November 13, 1996, 264 SCRA 68, 77], simplified its computation by
declaring that it means the total of 22.5 days arrived at after adding 15 days plus
2.5 days representing one-twelfth [1/12] of the 13th month pay plus 5 days of service
incentive leave.
Should 1/12 of 13th month pay and 5 days of service incentive leave be
included if the employees are not entitled thereto?
A question may be posed. Supposing the retiring employee, by reason of the nature
of his work, was not entitled to 13th month pay or to the service incentive leave pay
pursuant to the exceptions mentioned in the 13th-Month Pay Law and the Labor
Code, should he be paid upon retirement, in addition to the salary equivalent to
fifteen (15) days, the additional 2.5 days representing one-twelfth [1/12] of the 13th
month pay as well as the five (5) days representing the service incentive leave for a
total of 22.5 days?
This question was answered in the negative in the 2004 case of R & E Transport, Inc.
vs. Latag, [G. R. No. 155214, February 13, 2004]. The Supreme Court ruled that
employees who are not entitled to 13th month pay and service incentive leave pay
while still working should not be paid the entire 22.5 days but only the fifteen (15)
days salary. In other words, the additional 2.5 days representing one-twelfth [1/12]
of the 13th month pay and the five (5) days of service incentive leave should not be
included as part of the retirement benefits.
The employee in the said case was a taxi driver who was being paid on the
boundary system basis. It was undisputed that he was entitled to retirement
benefits after working for 14 years with R & E Transport, Inc. On the question of how
much he should receive as and by way of retirement benefits, the Supreme Court
pronounced:
The rules implementing the New Retirement Law similarly provide the above-
mentioned formula for computing the one-half month salary. (Section 5, Rule II of the
Rules Implementing RA 7641 or the New Retirement Law). Since Pedro was paid
according to the boundary system, he is not entitled to the 13th month in
accordance with Section 3 of the Rules and Regulations Implementing P. D. No. 851
[which exempts from its coverage employers of those who are paid on purely
boundary basis], and the service incentive leave pay pursuant to Section 1 of Rule V,
Book III of the Rules to Implement the Labor Code [which expressly excepts field
personnel and other employees whose performance is unsupervised by the employer,
including those who are engaged on task or contract basis, purely commission basis,
or those who are paid a fixed amount for performing work irrespective of the time
consumed in the performance]. Hence, his retirement pay should be computed on
the sole basis of his salary.
It is accepted that taxi drivers do not receive fixed wages, but retain only those
sums in excess of the boundary or fee they pay to the owners or operators of their
vehicles. Thus, the basis for computing their benefits should be the average daily
income. In this case, the CA found that Pedro was earning an average of five
hundred pesos (P500) per day. We thus compute his retirement pay as follows: P500
x 15 days x 14 years of service equals P105,000. Compared with this amount, the
P38,850 he received, which represented just over one third of what was legally due
him, was unconscionable. (Underscoring supplied)
Liberal interpretation of retirement laws; exception.
It is axiomatic that retirement laws are liberally construed and administered in favor
of the persons intended to be benefited. All doubts as to the intent of the law should
be resolved in favor of the retiree to achieve its humanitarian purposes. The intention
is to provide for the retirees sustenance and hopefully even comfort, when he no
longer has the stamina to continue earning his livelihood.
While it is axiomatic that retirement laws are liberally construed in favor of the
persons intended to be benefited, however, such interpretation cannot be made in
the event there is clear lack of consensual and statutory basis of the grant of
retirement benefits to the claimant-employee.
For instance, in the 2004 case of Lopez vs. National Steel Corporation, [G. R. No.
149674, February 16, 2004], the Labor Arbiter, the NLRC and the Court of Appeals
were one in saying that there is no provision in the parties CBA authorizing the
payment to petitioner-employee of retirement benefits in addition to her
retrenchment pay; and that there is no indication that she was forced or duped by
respondent-employer to sign the Release and Quitclaim. The Court of Appeals also
ruled that petitioner, not having reached the retirement age, is not entitled to
retirement benefits under Article 287 of the Labor Code. In justifying her claim for
retirement benefits, petitioner contends that respondents September 20, 1994
termination letter declares in unequivocal terms that (Y)ou will receive a separation
package in accordance with the program and existing policies, including benefits you
may be entitled to, if any, under the Companys Retirement Plan. According to her,
the quoted statement expressly guarantees the grant of retirement benefits. Suffice
it to reiterate that the respondents retirement plan precludes employees whose
services were terminated for cause, from availing retirement benefits.
The interpretation that retirement laws are liberally construed in favor of the
persons intended to be benefited cannot be made in this case in light of the clear
lack of consensual and statutory basis of the grant of retirement benefits to
petitioner.
(Divina Lopez vs Natl Steel Corp., GR# 149674 02/16/04)
In this case, respondent was employed in a previous taxi company but it closed and
was later employed by herein respondent. When he was asked to retire, he sought
retirement pay for his time with the previous taxi company and with petitioner,
invoking the doctrine of piercing the corporate veil. The Supreme Court denied this
contention, saying that an application of the doctrine in this case is not proper
since the requisite elements were not present to show that both companies were
one and the same. These elements are; (1) Control; (2) Such control was used to
commit fraud or unlawful activity; (3) Such control is the proximate cause of the
injury.
There was a failure to establish that the element of control existed between the 2
companies, considering the fact that petitioner was only established 7 years after
the closure of the previous company.
(R&E Transport vs Latag, GR# 155214 02/13/04)
The instant case equally calls for balancing the interests of the employer
with those of the worker, if only to approximate what Justice Laurel calls
justice in its secular sense.
In our view, with these special circumstances, we can call upon the same social
and compassionate justice cited in several cases allowing financial assistance.
These circumstances indubitably merit equitable concessions, via the principle of
compassionate justice for the working class.
(Eastern Shipping Lines Inc. vs Antonio, GR# 171587 10/13/09)
6. Resignation
(Labor Code)
ART. 285. Termination by employee.
(a) An employee may terminate without just cause the employee-employer
relationship by serving a written notice on the employer at least one (1) month in
advance. The employer upon whom no such notice was served may hold the
employee liable for damages.
(b) An employee may put an end to the relationship without serving any notice on
the employer for any of the following just causes:
1. Serious insult by the employer or his representative on the honor and
person of the employee;
When a first resignation letter was a pro forma one, entirely drafted by the
employer for the employee to merely affix his signature, and the second one
entirely copied by the employee with his own hand from the first resignation letter,
voluntariness is not attendant.
It is a rule that resignation is difficult to reconcile with the filing of a complaint for
illegal dismissal.
(Mobile Protective & Detective Agency vs Ompad, GR# 159195 05/09/05)
1. Reinstatement
(Labor Code)
ART. 279. Security of tenure. - In cases of regular employment, the employer shall
not terminate the services of an employee except for a just cause or when authorized
by this Title. An employee who is unjustly dismissed from work shall be entitled to
reinstatement without loss of seniority rights and other privileges and to his full
backwages, inclusive of allowances, and to his other benefits or their monetary
equivalent computed from the time his compensation was withheld from him up to
the time of his actual reinstatement. (As amended by Section 34, Republic Act No.
6715, March 21, 1989).
(Labor Code)
ART. 223. Appeal. - Decisions, awards, or orders of the Labor Arbiter are final and
executory unless appealed to the Commission by any or both parties within ten (10)
calendar days from receipt of such decisions, awards, or orders. Such appeal may be
entertained only on any of the following grounds:
(a) If there is prima facie evidence of abuse of discretion on the part of the Labor
Arbiter;
(b) If the decision, order or award was secured through fraud or coercion, including
graft and corruption;
(d) If serious errors in the findings of facts are raised which would cause grave or
irreparable damage or injury to the appellant.
In any event, the decision of the Labor Arbiter reinstating a dismissed or separated
employee, insofar as the reinstatement aspect is concerned, shall immediately be
executory, even pending appeal. The employee shall either be admitted back to work
under the same terms and conditions prevailing prior to his dismissal or separation
or, at the option of the employer, merely reinstated in the payroll. The posting of a
bond by the employer shall not stay the execution for reinstatement provided herein.
To discourage frivolous or dilatory appeals, the Commission or the Labor Arbiter shall
impose reasonable penalty, including fines or censures, upon the erring parties.
In all cases, the appellant shall furnish a copy of the memorandum of appeal to the
other party who shall file an answer not later than ten (10) calendar days from
receipt thereof.
The Commission shall decide all cases within twenty (20) calendar days from receipt
of the answer of the appellee. The decision of the Commission shall be final and
executory after ten (10) calendar days from receipt thereof by the parties.
Any law enforcement agency may be deputized by the Secretary of Labor and
Employment or the Commission in the enforcement of decisions, awards or orders.
(As amended by Section 12, Republic Act No. 6715, March 21, 1989).
(b) The Secretary of Labor and Employment, and the Chairman of the Commission
may designate special sheriffs and take any measure under existing laws to ensure
compliance with their decisions, orders or awards and those of the Labor Arbiters and
voluntary arbitrators, including the imposition of administrative fines which shall not
be less than P500.00 nor more than P10,000.00. (As amended by Section 13,
Republic Act No. 6715, March 21, 1989).
No motion or request for extension of the period within which to perfect an appeal
shall be allowed.
Section 2. Grounds. - The appeal may be entertained only on any of the following
grounds:
a) If there is prima facie evidence of abuse of discretion on the part of the Labor
Arbiter or Regional Director;
b) If the decision, resolution or order was secured through fraud or coercion,
including graft and corruption;
c) If made purely on questions of law; and/or
d) If serious errors in the findings of facts are raised which, if not corrected,
would cause grave or irreparable damage or injury to the appellant.
Section 3. Where Filed. - The appeal shall be filed with the Regional Arbitration
Branch or Regional Office where the case was heard and decided.
Section 5. Appeal Fee. - The appellant shall pay an appeal fee of One Hundred Fifty
Pesos (P150.00) to the Regional Arbitration Branch or Regional Office of origin, and
the official receipt of such payment shall form part of the records of the case.
Section 6. Bond. - In case the decision of the Labor Arbiter or the Regional Director
involves a monetary award, an appeal by the employer may be perfected only upon
the posting of a bond, which shall either be in the form of cash deposit or surety bond
equivalent in amount to the monetary award, exclusive of damages and attorney's
fees.
In case of surety bond, the same shall be issued by a reputable bonding company
duly accredited by the Commission or the Supreme Court, and shall be accompanied
by original or certified true copies of the following:
a) a joint declaration under oath by the employer, his counsel, and the bonding
company, attesting that the bond posted is genuine, and shall be in effect until
final disposition of the case.
b) an indemnity agreement between the employer-appellant and bonding
company;
c) proof of security deposit or collateral securing the bond: provided, that a
check shall not be considered as an acceptable security;
d) a certificate of authority from the Insurance Commission;
e) certificate of registration from the Securities and Exchange Commission;
f) certificate of authority to transact surety business from the Office of the
President;
g) certificate of accreditation and authority from the Supreme Court; and
h) notarized board resolution or secretary's certificate from the bonding
company showing its authorized signatories and their specimen signatures.
A cash or surety bond shall be valid and effective from the date of deposit or posting,
until the case is finally decided, resolved or terminated, or the award satisfied. This
condition shall be deemed incorporated in the terms and conditions of the surety
bond, and shall be binding on the appellants and the bonding company.
The appellant shall furnish the appellee with a certified true copy of the said surety
bond with all the above-mentioned supporting documents. The appellee shall verify
the regularity and genuineness thereof and immediately report any irregularity to the
Commission.
Upon verification by the Commission that the bond is irregular or not genuine, the
Commission shall cause the immediate dismissal of the appeal, and censure or cite in
contempt the responsible parties and their counsels, or subject them to reasonable
fine or penalty.
The mere filing of a motion to reduce bond without complying with the requisites in
the preceding paragraphs shall not stop the running of the period to perfect an
appeal.
Section 11. Appeals from Decision of Other Agencies. - The Rules provided herein
governing appeals from the decisions or orders of Labor Arbiters shall apply to
appeals to the Commission from decisions or orders of the other offices or agencies
appealable to the Commission according to law.
What is reinstatement?
a. Reinstatement under Articles 279 and 223 of the Labor Code, distinguished.
Reinstatement under Article 279 presupposes that the judgment has already become
final and executory. Consequently, there is nothing left to be done except the
execution thereof. Reinstatement under Article 223 of the Labor Code, however, may
be availed of as soon as the Labor Arbiter renders a judgment declaring that the
dismissal of the employee is illegal and ordering said reinstatement. It may be
availed of even pending appeal.
In case of illegal dismissal - The consequence of illegality thereof is reinstatement
without loss of seniority rights and with full backwages (inclusive of allowances and
other benefits computed from the time his compensation was withheld up to the time
of his actual reinstatement).
The failure to allege reinstatement as one of the reliefs in the complaint for illegal
dismissal is not fatal. In the interest of justice, according to Manipon vs. NLRC, [G. R.
No. 105338, Dec. 27, 1994], although the issue of the grant of separation pay was
never contested even at the level of the Labor Arbiter nor assigned as error at the
NLRC level, the Labor Arbiters ruling where he granted petitioner separation pay
instead of ordering his reinstatement should be corrected. Reinstatement should be
granted although he failed to specifically pray for the same in his complaint. (See
also General Baptist Bible College vs. NLRC, 219 SCRA 549 [1993]).
In Pheschem Industrial Corporation vs. Moldez, [G. R. No. 161158, May 9, 2005],
respondents omission to pray for reinstatement in his position paper before the
Labor Arbiter was not considered as an implied waiver to be reinstated. It was
considered a mere procedural lapse which should not affect his substantive right to
reinstatement. It is a settled principle that technicalities have no place in labor cases
as rules of procedure are designed primarily to give substance and meaning to the
objectives of the Labor Code to accord protection to labor.
A different rule, however, applies in a case where reinstatement was not prayed for
in the complaint but the payment of separation pay in lieu thereof. As pronounced in
Dela Cruz vs. NLRC, [G. R. No. 121288, Nov. 20, 1998, 299 SCRA 1, 13], the petitioner
therein would have been entitled to reinstatement as a consequence of his illegal
dismissal from employment. However, by expressly asking for separation pay, he is
deemed to have opted for separation pay in lieu of reinstatement. This is the tenor
of the holding in Reformist Union vs. NLRC, [266 SCRA 713, 728-729 (1997)] to the
effect that separation pay is awarded as an alternative to reinstatement.
In the 2003 case of Solidbank Corporation vs. CA, [G. R. No. 151026, Aug. 25, 2003],
where the employee explicitly prayed for an award of separation pay in lieu of
reinstatement, the Supreme Court said that by so doing, he forecloses reinstatement
as a relief by implication. Consequently, he is entitled to separation pay equivalent to
one month pay for every year of service, from the time of his illegal dismissal up to
the finality of this judgment, as an alternative to reinstatement.
Employee ordered reinstated may, at the end of the proceeding, opt for
separation pay instead.
The employee who files an illegal dismissal case may choose between reinstatement
and payment of separation pay in lieu of reinstatement. He is bound by the relief he
prayed for in his complaint. If ordered reinstated later on after the end of the
proceedings, he has no other option but to abide thereby.
However, the Supreme Court recognizes an exception. In the 2004 case of Procter
and Gamble Philippines vs. Bondesto, [G. R. No. 139847, March 5, 2004], after more
than a year after the respondent was placed on payroll reinstatement, the companys
Tondo Plant, where the respondent was assigned, was shut down. Since the
respondents employment could not be maintained at the Tondo Plant, so the
petitioner maintains, it was constrained to discontinue the respondents payroll
reinstatement. Clearly, the respondent is entitled to reinstatement, without loss of
seniority rights to another position of similar nature in the company. It should be
stressed that while the petitioner manifested the closure of the Tondo Plant, it failed
to indicate the absence of an unfilled position more or less of a similar nature as the
one previously occupied by the respondent at its other plant/s. However, if the
respondent no longer desires to be reinstated, he should be awarded separation pay
at the rate of one (1) month for every year of service as an alternative, following
settled jurisprudence.
While reinstatement is a relief mandated in illegal dismissal cases, the same cannot
be awarded in instances where it is no longer feasible as in a case where private
respondent is already over-aged. In such a case, the proper remedy is to award
separation pay in lieu of reinstatement. (Benguet Corporation vs. NLRC and Felizardo
A. Guianan, G. R. No. 124166, Nov. 16, 1999; Espejo vs. NLRC, G. R. No. 112678,
March 29, 1996, 255 SCRA 430, 435).
However, as held in Tanduay Distillery Labor Union vs. NLRC, [G. R. No. 73352, Dec.
06, 1994], in the event that the previous positions of petitioners may no longer be
open or available, considering that more than ten (10) years have since elapsed from
the date of their dismissal, private respondent-employer has to pay, in lieu of
reinstatement and in addition to the three-year back salaries, separation pay
equivalent to at least one (1) month pay for every year of service. (See also RCPI vs.
NLRC, 210 SCRA 222; Torillo vs. Leogardo, Jr., 197 SCRA 471).
1. Declaration of insolvency by the court. (Electruck Asia, Inc. vs. Meris, G. R. No.
147031, July 27, 2004).
2. Fire which gutted the hotel and resulted in its total destruction. (Bagong Bayan
Corporation vs. Ople, G. R. No. 73334, Dec. 8, 1986).
3. Closure of the business of the employer. (Section 4[b], Rule I, Book VI, Rules to
Implement the Labor Code; Philtread Tire & Rubber Corporation vs. Vicente, G. R.
No. 142759, Nov. 10, 2004).
4. Non-existence of the employees former position at the time of reinstatement for
reasons not attributable to the fault of the employer. (Section 4[b], Rule I, Book
VI, Rules to Implement the Labor Code; Pizza Inn vs. NLRC, G. R. No. 74531, June
28, 1988).
5. Take over of the business of the employer by another company and there is no
agreement regarding assumption of liability by the acquiring company. (Callanta
vs. Carnation Philippines, G. R. No. 70615, Oct. 28, 1986).
2. Another instance of payroll reinstatement is found in Article 223 of the Labor Code,
after the Labor Arbiter ordered the reinstatement of the employee pending appeal to
NLRC, employer has the option to reinstate the employee concerned only on payroll.
The provision states:
Article 263 (g). When, in his opinion, there exists a labor dispute causing or likely to
cause a strike or lockout in an industry indispensable to the national interest, the
Secretary of Labor and Employment may assume jurisdiction over the dispute and
decide it or certify the same to the Commission for compulsory arbitration. Such
assumption or certification shall have the effect of automatically enjoining the
intended or impending strike or lockout as specified in the assumption or certification
order. If one has already taken place at the time of assumption or certification, all
striking or locked out employees shall immediately return to work and the employer
shall immediately resume operations and readmit all workers under the same terms
and conditions prevailing before the strike or lockout. x x x
Under the said provision, all workers must immediately return to work and all
employers must readmit all of them under the same terms and conditions prevailing
before the strike or lockout. (See Manila Diamond Hotel case, compare with
University of Santo Tomas case.)
Effect of failure of employer to exercise the option
Under Article 223, the option whether to actually reinstate the employee, or to
reinstate him only in the payroll belongs to the employer. Thus, the employer may
either re-admit the employee to work under the same terms and conditions
prevailing prior to their dismissal, or to reinstate him in the payroll. Failing to exercise
the options in the alternative, employer must pay the employees salaries.
The same thing may be said in payroll reinstatement under Article 223, although the
article does not expressly so states.
However, there was an authority supporting the opposite view that the employee
may be required to refund the employer for salary paid. This view was articulated in
Genuino v. National Labor Relations Commission as follows:
If the decision of the labor arbiter is later reversed on appeal upon the finding that
the ground for dismissal is valid, then the employer has the right to require the
dismissed employee on payroll reinstatement to refund the salaries s/he received
while the case was pending appeal, or it can be deducted from the accrued benefits
that the dismissed employee was entitled to receive from his/her employer under
existing laws, collective bargaining agreement provisions, and company practices.
However, if the employee was reinstated to work during the pendency of the appeal,
then the employee is entitled to the compensation received for actual services
rendered without need of refund.
The above view, however, does not appear to be the prevailing principle on the
matter, and was played down as a mere stray posture in a subsequent case (See
Garcia vs. Philippine Airlines).
References
1. Manila Diamond Hotel vs. Court of Appeals, G.R. No. 140518, December 16, 2004.
2. University of Santo Tomas (UST) vs. NLRC, G.R. No. 89920, October 18, 1990.
3. Genuino v. NLRC, G.R. Nos. 142732-33, December 4, 2007.
4. Garcia vs. Philippine Airlines, G.R. No. 164856, January 20, 2009.
1. Actual Reinstatement
2. Payroll Reinstatement
A. Nature
In order for the doctrine of strained relations to apply, it should be proved that
the employee concerned occupies a position where he enjoys the trust and
confidence of his employer and that it is likely that if reinstated, an atmosphere
of antipathy and antagonism may be generated as to adversely affect the
efficiency and productivity of the employee concerned.
It bears to stress that reinstatement is the rule and, for the exception of
strained relations to apply, it should be proved that it is likely that if reinstated,
an atmosphere of antipathy and antagonism would be generated as to
adversely affect the efficiency and productivity of the employee concerned.
However, both the LA and the CA failed to state the basis for their finding that a
strained relationship exists.
In conclusion, it bears to stress that it is human nature that some hostility will
inevitably arise between parties as a result of litigation, but the same does not
always constitute strained relations in the absence of proof or explanation that
such indeed exists.
(Cabigting vs San Miguel Foods Inc., GR# 167706 11/05/09)
Strained Relations
Old Age of the Employee
Ill-health of the Employee
The position is no longer available
Closure of the company
In the present case, the Labor Arbiter found that actual animosity existed
between petitioner Azul and respondent as a result of the filing of the illegal
dismissal case. Such finding, especially when affirmed by the appellate court as
in the case at bar, is binding upon the Court, consistent with the prevailing rules
that the Court will not try facts anew and that findings of facts of quasi-judicial
bodies are accorded great respect, even finality.
(Golden Ace Builders vs Talde, GR# 187200 05/05/10)
2. Backwages
Clearly, the law intends the award of backwages and similar benefits to accumulate
past the date of the Labor Arbiters decision until the dismissed employee is
actually reinstated. But if, as in this case, reinstatement is no longer possible, this
Court has consistently ruled that backwages shall be computed from the time of
illegal dismissal until the date the decision becomes final.
Separation pay, on the other hand, is equivalent to one month pay for every year of
service, a fraction of six months to be considered as one whole year. Here that
would begin from January 31, 1994 when petitioner Belen began his service.
Technically the computation of his separation pay would end on the day he was
dismissed on August 20, 1999 when he supposedly ceased to render service and
his wages ended. But, since Belen was entitled to collect backwages until the
judgment for illegal dismissal in his favor became final, here on September 22,
2008, the computation of his separation pay should also end on that date.
Further, since the monetary awards remained unpaid even after it became final on
September 22, 2008 because of issues raised respecting the correct computation of
such awards, it is but fair that respondent Javellana be required to pay 12% interest
per annum on those awards from September 22, 2008 until they are paid. The 12%
interest is proper because the Court treats monetary claims in labor cases the
equivalent of a forbearance of credit. It matters not that the amounts of the claims
were still in question on September 22, 2008. What is decisive is that the order to
pay the monetary awards had long become final.
(Javellana, Jr. vs Belen, GR# 181913 03/05/10)
Abandonment as a just ground for dismissal thus requires clear, willful, deliberate,
and unjustified refusal of the employee to resume employment. Mere absence or
failure to report for work, even after notice to return, is not tantamount to
abandonment.
Hence they are entitled to reinstatement with full backwages or in the alternative
to full separation pay of one month per year of service.
(Fe La Rosa vs Ambasador Hotel, GR# 177059 03/13/09)
DAMAGES
(Civil Code)
Title XVIII. - DAMAGES
CHAPTER 1
GENERAL PROVISIONS
Art. 2195. The provisions of this Title shall be respectively applicable to all
obligations mentioned in Article 1157.
Art. 2196. The rules under this Title are without prejudice to special provisions on
damages formulated elsewhere in this Code. Compensation for workmen and other
employees in case of death, injury or illness is regulated by special laws. Rules
governing damages laid down in other laws shall be observed insofar as they are not
in conflict with this Code.
(2) Moral;
(3) Nominal;
(5) Liquidated; or
Art. 2198. The principles of the general law on damages are hereby adopted insofar
as they are not inconsistent with this Code.
CHAPTER 2
ACTUAL OR COMPENSATORY DAMAGES
Art. 2200. Indemnification for damages shall comprehend not only the value of the
loss suffered, but also that of the profits which the obligee failed to obtain. (1106)
Art. 2201. In contracts and quasi-contracts, the damages for which the obligor who
acted in good faith is liable shall be those that are the natural and probable
consequences of the breach of the obligation, and which the parties have foreseen or
could have reasonably foreseen at the time the obligation was constituted.
In case of fraud, bad faith, malice or wanton attitude, the obligor shall be responsible
for all damages which may be reasonably attributed to the non-performance of the
obligation. (1107a)
Art. 2202. In crimes and quasi-delicts, the defendant shall be liable for all damages
which are the natural and probable consequences of the act or omission complained
of. It is not necessary that such damages have been foreseen or could have
reasonably been foreseen by the defendant.
Art. 2203. The party suffering loss or injury must exercise the diligence of a good
father of a family to minimize the damages resulting from the act or omission in
question.
Art. 2206. The amount of damages for death caused by a crime or quasi-delict shall
be at least three thousand pesos, even though there may have been mitigating
circumstances. In addition:
(1) The defendant shall be liable for the loss of the earning capacity of the
deceased, and the indemnity shall be paid to the heirs of the latter; such indemnity
shall in every case be assessed and awarded by the court, unless the deceased on
account of permanent physical disability not caused by the defendant, had no
earning capacity at the time of his death;
(2) If the deceased was obliged to give support according to the provisions of
Article 291, the recipient who is not an heir called to the decedent's inheritance by
the law of testate or intestate succession, may demand support from the person
causing the death, for a period not exceeding five years, the exact duration to be
fixed by the court;
(3) The spouse, legitimate and illegitimate descendants and ascendants of the
deceased may demand moral damages for mental anguish by reason of the death of
the deceased.
Art. 2207. If the plaintiff's property has been insured, and he has received indemnity
from the insurance company for the injury or loss arising out of the wrong or breach
of contract complained of, the insurance company shall be subrogated to the rights
of the insured against the wrongdoer or the person who has violated the contract. If
the amount paid by the insurance company does not fully cover the injury or loss, the
aggrieved party shall be entitled to recover the deficiency from the person causing
the loss or injury.
Art. 2208. In the absence of stipulation, attorney's fees and expenses of litigation,
other than judicial costs, cannot be recovered, except:
(2) When the defendant's act or omission has compelled the plaintiff to litigate
with third persons or to incur expenses to protect his interest;
(4) In case of a clearly unfounded civil action or proceeding against the plaintiff;
(5) Where the defendant acted in gross and evident bad faith in refusing to
satisfy the plaintiff's plainly valid, just and demandable claim;
(7) In actions for the recovery of wages of household helpers, laborers and skilled
workers;
(9) In a separate civil action to recover civil liability arising from a crime;
(10) When at least double judicial costs are awarded;
(11) In any other case where the court deems it just and equitable that attorney's
fees and expenses of litigation should be recovered.
In all cases, the attorney's fees and expenses of litigation must be reasonable.
Art. 2209. If the obligation consists in the payment of a sum of money, and the
debtor incurs in delay, the indemnity for damages, there being no stipulation to the
contrary, shall be the payment of the interest agreed upon, and in the absence of
stipulation, the legal interest, which is six per cent per annum. (1108)
Art. 2210. Interest may, in the discretion of the court, be allowed upon damages
awarded for breach of contract.
Art. 2211. In crimes and quasi-delicts, interest as a part of the damages may, in a
proper case, be adjudicated in the discretion of the court.
Art. 2212. Interest due shall earn legal interest from the time it is judicially
demanded, although the obligation may be silent upon this point. (1109a)
Art. 2214. In quasi-delicts, the contributory negligence of the plaintiff shall reduce
the damages that he may recover.
Art. 2215. In contracts, quasi-contracts, and quasi-delicts, the court may equitably
mitigate the damages under circumstances other than the case referred to in the
preceding article, as in the following instances:
(1) That the plaintiff himself has contravened the terms of the contract;
(2) That the plaintiff has derived some benefit as a result of the contract;
(3) In cases where exemplary damages are to be awarded, that the defendant
acted upon the advice of counsel;
(5) That since the filing of the action, the defendant has done his best to lessen
the plaintiff's loss or injury.
CHAPTER 3
OTHER KINDS OF DAMAGES
Art. 2216. No proof of pecuniary loss is necessary in order that moral, nominal,
temperate, liquidated or exemplary damages, may be adjudicated. The assessment
of such damages, except liquidated ones, is left to the discretion of the court,
according to the circumstances of each case.
Art. 2217. Moral damages include physical suffering, mental anguish, fright, serious
anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation,
and similar injury. Though incapable of pecuniary computation, moral damages may
be recovered if they are the proximate result of the defendant's wrongful act for
omission.
Art. 2218. In the adjudication of moral damages, the sentimental value of property,
real or personal, may be considered.
Art. 2219. Moral damages may be recovered in the following and analogous cases:
(10) Acts and actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34, and 35.
The parents of the female seduced, abducted, raped, or abused, referred to in No. 3
of this article, may also recover moral damages.
The spouse, descendants, ascendants, and brothers and sisters may bring the action
mentioned in No. 9 of this article, in the order named.
Art. 2220. Willful injury to property may be a legal ground for awarding moral
damages if the court should find that, under the circumstances, such damages are
justly due. The same rule applies to breaches of contract where the defendant acted
fraudulently or in bad faith.
Art. 2221. Nominal damages are adjudicated in order that a right of the plaintiff,
which has been violated or invaded by the defendant, may be vindicated or
recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered
by him.
Art. 2222. The court may award nominal damages in every obligation arising from
any source enumerated in Article 1157, or in every case where any property right has
been invaded.
Art. 2223. The adjudication of nominal damages shall preclude further contest upon
the right involved and all accessory questions, as between the parties to the suit, or
their respective heirs and assigns.
Art. 2224. Temperate or moderate damages, which are more than nominal but less
than compensatory damages, may be recovered when the court finds that some
pecuniary loss has been suffered but its amount can not, from the nature of the case,
be provided with certainty.
Art. 2226. Liquidated damages are those agreed upon by the parties to a contract,
to be paid in case of breach thereof.
Art. 2228. When the breach of the contract committed by the defendant is not the
one contemplated by the parties in agreeing upon the liquidated damages, the law
shall determine the measure of damages, and not the stipulation.
Art. 2230. In criminal offenses, exemplary damages as a part of the civil liability
may be imposed when the crime was committed with one or more aggravating
circumstances. Such damages are separate and distinct from fines and shall be paid
to the offended party.
Art. 2232. In contracts and quasi-contracts, the court may award exemplary
damages if the defendant acted in a wanton, fraudulent, reckless, oppressive, or
malevolent manner.
Art. 2233. Exemplary damages cannot be recovered as a matter of right; the court
will decide whether or not they should be adjudicated.
Art. 2234. While the amount of the exemplary damages need not be proved, the
plaintiff must show that he is entitled to moral, temperate or compensatory damages
before the court may consider the question of whether or not exemplary damages
should be awarded. In case liquidated damages have been agreed upon, although no
proof of loss is necessary in order that such liquidated damages may be recovered,
nevertheless, before the court may consider the question of granting exemplary in
addition to the liquidated damages, the plaintiff must show that he would be entitled
to moral, temperate or compensatory damages were it not for the stipulation for
liquidated damages.
There is merit in petitioners submission that the award of moral and exemplary
damages in her favor is warranted by her unjustified dismissal. Award of moral and
exemplary damages for an illegally dismissed employee is proper where the
employee had been harassed and arbitrarily terminated by the employer. Moral
damages may be awarded to compensate one for diverse injuries such as mental
anguish, besmirched reputation, wounded feelings, and social humiliation
occasioned by the employers unreasonable dismissal of the employee. This Court
has consistently accorded the working class a right to recover damages for unjust
dismissals tainted with bad faith; where the motive of the employer in dismissing
the employee is far from noble. The award of such damages is based not on the
Labor Code but on Art. 220(???) of the Civil Code. However, under the attendant
facts and circumstances, the Court is of the sense that the amount of P120,000
awarded by the Labor Arbiter for moral and exemplary damages is too much.
P50,000 of moral damages and P10,000 of exemplary damages should suffice.
Under these circumstances, the award of damages was proper. As a rule, moral
damages are recoverable when the dismissal of the employee was attended by bad
faith or fraud or constituted an act oppressive to labor, or was done in a manner
contrary to morals, good customs or public policy. We believe that the dismissal of
the respondents was attended with bad faith and meant to evade the lawful
obligations imposed upon an employer. To rule otherwise would lead to the
anomaly of respondents being terminated from employment in 1997 as a matter of
fact, but without legal redress. This runs counter to the notions of fair play,
substantial justice and the constitutional mandate that labor rights should be
respected. If doubts exist between the evidence presented by the employer and the
employee, the scales of justice must be tilted in favor of the latter - the employer
must affirmatively show rationally adequate evidence that the dismissal was for
justifiable cause. It is a time-honored rule that in controversies between a laborer
and his master, doubts reasonably arising from the evidence, or in the
interpretation of agreements and writing should be resolved in the formers favor.
The policy is to extend the doctrine to a greater number of employees who can
avail of the benefits under the law, which is in consonance with the avowed policy
of the State to give maximum aid and protection of labor.
While it is true that other forms of damages under the Civil Code may be awarded
to illegally dismissed employees, any award of moral damages by the Labor Arbiter
cannot be based on the Labor Code but should be grounded on the Civil Code.
(Mayon & Hotel Restaurant, GR# 157634 05/16/05)
- (Armando David vs Natl Fed. Of Labor Union, GR# 148263 & 148271-72
04/21/09)
Nominal damages awarded was P50,000. This was a retrenchment case, but no
notice was given.
The propriety of employee's dismissal is not affected by the lack of written notices.
When the dismissal is for just cause, the lack of due process does not render the
dismissal ineffectual but merely gives rise to the payment of P30,000 in nominal
damages.
(Bernardo Jose, Jr. vs Michaelmar Phils. Inc. , GR# 169605 11/27/09)
In an unlawful dismissal case, the employer has the burden of proving the lawful
cause sustaining the dismissal of the employee. The employer must affirmatively
show rationally adequate evidence that the dismissal was for a justifiable cause.
The employees behavior constituted just cause. However, the company cannot
deny that it failed to observe due process.
The law requires that the employer must furnish the worker sought to be dismissed
with two written notices before termination of employment can be legally effected:
(1) notice which apprises the employee of the particular acts or omissions for which
his dismissal is sought; and
(2) the subsequent notice which informs the employee of the employers decision
to dismiss him.
Violation of the employees right to statutory due process, even if the dismissal was
for a just cause, warrants the payment of indemnity in the form of nominal
damages. This indemnity is not intended to penalize the employer but to vindicate
or recognize the employees right to statutory due process, which was violated by
the employer in the present case.
In this case, the amount of nominal damages was P120,000 because it was the
company that offered the amount.
(Hilton Heavy Equipment Corp. vs Ananias Dy, GR# 164860 02/02/10)
3. Separation Pay
The rule embodied in the Labor Code is that a person dismissed for cause as
defined therein is not entitled to separation pay. The cases cited above constitute
the exception, based upon considerations of equity. Equity has been defined as
justice outside law, being ethical rather than jural and belonging to the sphere of
morals than of law. It is grounded on the precepts of conscience and not on any
sanction of positive law. Hence, it cannot prevail against the expressed provision of
the labor laws allowing dismissal of employees for cause and without any provision
for separation pay.
Grant of separation pay to the dismissed employee is just where the separation was
due to valid but iniquitous causes as failure to comply with work standards. Grant
of award is based on the social justice policy even if separation is for cause.
Where the cause of separation is more serious than mere inefficiency, the award is
not justified.
Henceforth, separation pay shall be allowed only in those instances where the
employee is validly dismissed for causes other than serious misconduct or those
reflecting on his moral character. Where the reason for the valid dismissal is
habitual insubordination or an offense involving moral turpitude, the employer may
not be required to give the dismissed employee separation pay or financial
assistance.
A contrary rule would have the effect of rewarding rather than punishing the erring
employee for his offense.
If found to be due under the circumstances of each case, the separation pay should
be computed at the rate of 1 month salary for every year of service.
(PLDT vs NLRC, GR# 80609 08/23/88)
Separation pay may be awarded provided that the dismissal does not fall under
either of the 2 circumstances:
(Labor Code)
ART. 111. Attorneys fees. - (a) In cases of unlawful withholding of wages, the
culpable party may be assessed attorneys fees equivalent to ten percent of the
amount of wages recovered.
(b) It shall be unlawful for any person to demand or accept, in any judicial or
administrative proceedings for the recovery of wages, attorneys fees which exceed
ten percent of the amount of wages recovered.
ART. 222. Appearances and Fees. - (a) Non-lawyers may appear before the
Commission or any Labor Arbiter only:
(b) No attorneys fees, negotiation fees or similar charges of any kind arising from
any collective bargaining agreement shall be imposed on any individual member of
the contracting union: Provided, However, that attorneys fees may be charged
against union funds in an amount to be agreed upon by the parties. Any contract,
agreement or arrangement of any sort to the contrary shall be null and void. (As
amended by Presidential Decree No. 1691, May 1, 1980).