2009 Labor Law Reviewer

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Copyright and all other relevant rights over this material are owned jointly by the University of the Philippines College of Law, the Faculty Editor and the Student Editorial Team. The ownership of the work belongs to the University of the Philippines College of Law. No part of this book shall be reproduced or distributed without the consent of the UP College of Law. All rights are reserved.
REVIEWER IN LABOR LAW
Table of Contents
LABOR STANDARDS
CHAPTER I: INTRODUCTION TO LABOR LAW I. PRELIMINARY MATTERS A. Definition B. Classifications C. Basis D. Sources of Law E. Other Preliminary Matters II. CONSTITUTIONAL RIGHTS AND LABOR LAW A. Social Justice B. Management and the Constitution: Management Function/Prerogative C. Other Relevant Matters III. LABOR AND CIVIL CODE A. Contracts B. Fair Treatment C. Mutual Obligation D. Compliance With Law E. Obedience of Employee IV. LABOR INTERNATIONAL LAW AND LABOR V. THE LABOR CODE OF THE PHILIPPINES A. Policy Declaration B. Applicability C. Rule-Making Power D. Liberal Interpretation of the Law CHAPTER 2: EXISTENCE OF EMPLOYMENT RELATIONSHIP I. DEFINITION A. Person B. Employee C. Employer D. Managerial Employee II. EMPLOYER-EMPLOYEE RELATIONSHIP A. Factors B. Tests C. Other Factors III. INDEPENDENT CONTRACTOR AND LABOR-ONLY CONTRACTOR A. Statutory Bases B. Independent Contractor C. Labor-Only Contractor D. Liability CHAPTER 3: EMPLOYEE CLASSIFICATION I. STATUTORY BASIS/OVERVIEW OF CLASSIFICATION A. Coverage B. Regular Employment C. Casual Employment D. Probationary Employment E. Project Employment F. Seasonal Employment II. REGULAR EMPLOYEES III. PROJECT EMPLOYEES IV. CASUAL EMPLOYEES V. CONTRACTS FOR FIXED PERIODS VI. SEASONAL EMPLOYEES VII. PROBATIONARY EMPLOYEES 5 5 5 5 5 6 6 6 6 7 7 8 8 8 8 8 8 9 9 9 9 10 10 CHAPTER 4: EMPLOYMENT, RECRUITMENT, AND PLACEMENT OF WORKERS I. STATUTORY BASIS A. Substantive B. Procedural II. RECRUITMENT AND PLACEMENT DEFINED A. Local Employment B. Overseas Employment III. PARTIES INVOLVED A. Workers B. Allowed Entities For Recruitment C. Prohibited Entities IV. GOVERNMENT TECHNIQUES OF REGULATION A. Licensing B. Workers Fees C. Reports/Submission D. Suspension E. Enforcement Powers F. Sanctions V. PROHIBITED PRACTICES VI. ILLEGAL RECRUITMENT A. Local Employment B. Overseas Employment C. Cases VII. JURISDICTION A. Regional Trial Court B. Labor Arbiter C. POEA over administrative cases VIII. ALIEN EMPLOYMENT A. Coverage B. Techniques of Regulation C. DOLE Guidelines For Issuance of Alien Employment Permit IX. DEVELOPMENT OF HUMAN RESOURCES A. Human Resources Development B. Training and Development of Special Workers CHAPTER 5: CONDITIONS OF LABOR I. COVERAGE A. General rule B. Not covered II. HOURS OF WORK A. Normal hours of work B. Compensable hours of work--in general C. General principles in determining if time is considered as hours worked D. Specific rules determining hours of work and compensability E. Overtime work F. Night Work III. WEEKLY REST DAYS A. Coverage B. Scheduling rest day C. Compulsory work D. Premium pay IV. HOLIDAYS A. Coverage and exclusion B. Holidays covered 26 26 26 26 26 26 27 27 27 27 27 28 28 28 28 29 29 29 30 31 31 31 32 33 33 33 33 33 33 33 34 34 34 35 38 38 38 38 39 39 40 40 40 42 43 43 43 43 43 44 44 44 44
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C. Holiday pay computation D. Absences E. Non-working/scheduled rest day V. SERVICE INCENTIVE LEAVE A. Coverage and exemption B. Entitlement VI. PATERNAL LEAVE VII. PARENTAL LEAVE VIII. VICTIMS LEAVE CHAPERT 6: WAGES I. WAGES GENERAL CONCEPT A. Definition of Wage B. Coverage C. No work No Pay D. Equal Pay for Equal Work / Non Discrimination E. Facilities and supplements F. Commission G. Wages and Salary H. Gratuity I. Payment by results II. MINIMUM WAGES AND WAGE FIXING MACHINERY A. Constitutional Basis B. Agencies for Wage-Fixing Machinery C. Minimum Wages and Criteria D. Non-Diminution Rule E. Wage Distortion F. Special Cases G. Summary of Effects on Wages III. PAYMENT OF WAGES A. Form of Payment B. Time of Payment C. Place of Payment D. Direct Payment E. Contractor Subcontractor F. Prohibition Regarding Wages IV. OTHER FORMS OF REMUNERATION A. Service Charges B. 13th Month Pay C. Bonus D. Productivity Incentives V. WAGE RECOVERY, LIABILITIES, AND WORKER PREFERENCE A. Worker Preference in Case of Bankruptcy B. Attorneys Fees CHAPTER 7: WORKING CONDITIONS FOR SPECIAL GROUPS I. WOMEN WORKERS A. Women Under the Constitution B. Coverage C. Prohibited Acts D. Facilities E. Family Planning Services F. Classification of Certain Women Workers G. Maternity Leave H. Sexual Harassment II. MINORS A. Constitutional Basis B. Minimum Employable Age C. Prohibition of Certain Kinds of
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Work D. Employment of Children from 15 to 18 E. Hours of Work of a Working Child III. HOUSEHELPERS A. Definition B. Conditions of employment and other rights of the househelper IV. HOMEWORKERS A. Coverage B. Payment for Homework C. Prohibitions for Homework CHAPTER 8: TERMINATION OF EMPLOYMENT I. SECURITY OF TENURE IN GENERAL A. Definition B. Nature C. Coverage D. Conflict with Management Prerogatives II. TERMINATION BY EMPLOYEE A. Termination by Employee with Just Cause B. Termination by Employee without Just Cause C. Resignation D. No Termination III. TERMINATION BY EMPLOYER A. Just Causes (Substantive Due Process) 1. Serious misconduct 2. Willful disobedience 3. Gross or habitual neglect of duties 4. Fraud or willful breach of trust 5. Commission of a crime or offense 6. Analogous Causes 7. Constructive Discharge/Dismissal 8. Preventive Suspension B. Authorized Causes (Substantive Due Process) 1. Installation of labor saving devices 2. Redundancy 3. Retrenchment to prevent losses 4. Closing or cessation of operation 5. Disease C. Procedural Due Process 1. General Concepts 2. Consequences of NonCompliance 3. Right to Counsel 4. Notice 5. Hearing 6. Burden of Proof 7. Degree of Proof 8. Prescription Period D. Consequences and Remedies in Illegal Dismissal
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1. 2. 3. 4. 5. 6. 7.
Reinstatement Backwages Separation Pay Financial Assistance Damages and Other Indemnity Liability of Corporate Officers Guidelines on Imposition of Dismissal and Other Penalties 86 86 88 88 88 88 88 89 89 89 89 89 89 89 89 89 89 90 90 90 90 90 90 91 91 91 91 91 91 91 91 91 92 92 92 92 92 92
CHAPTER 9: WELFARE LEGISLATION I. COMPARISON: SSS AND GSIS II. BENEFITS UNDER THE SSS A. Computation of Pension B. Retirement C. Death D. Permanent Disability E. Funeral benefit F. Sickness G. Maternity H. Loan III. SSS: Effect of Non-reporting and Non-remittance of Contributions A. To the Employee B. To the Employer C. To the Self-employed D. To the Self-employed and Voluntary Member E. Change of Membership Category IV. BENEFITS UNDER THE GSIS A. Monthly Pension B. Separation Benefits C. Unemployment Benefits D. Retirement Benefits E. Permanent Disability Benefits F. Temporary Disability Benefits G. Survivorship Benefits H. Death Benefits I. Funeral Benefits J. Life Insurance K. Loan V. LIMITED PORTABILITY SCHEME UNDER RA 7699 A. Who is covered? B. What happens? C. Why? D. Overlapping periods VI. NATIONAL HEALTH INSURANCE ACT A. Who is covered? B. Who are dependents C. Benefits
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Table of Contents
LABOR RELATIONS
Chapter 1: STATE POLICY I. Methods of Dispute Settlement II. Trade Unionism III. Work Enlightenment IV. Machinery for Dispute Settlement A. National Labor Relations Commission (NLRC) B. National Conciliation and Mediation Board (NCMB) C. Bureau of Labor Relations D. Voluntary Arbitration Advisory Council (VAAC) E. Administrative Intervention for Dispute Avoidance V. Industrial Peace VI. Worker Participation in Decision and Policy Making Processes Affecting Rights, Duties, and Welfare Chapter 2: RIGHT TO SELF ORGANIZATION I. Basis of Right to Self-Organization A. 1987 Constitution B. Labor Code II. Extent and Scope of Right III. Worker Qualification IV. Covered Employees/Workers A. All Employees B. Government Corporate Employees C. Supervisory Employees D. Aliens E. Security Guards V. Excluded Employees/Workers A. Managerial Employees and Confidential Employees B. Worker/Member of Cooperative C. Employees of International Organizations D. Non-Employees VI. Party Protected VII. Non-Abridgment of Right and Sanctions for Violation of Right Chapter 3: LABOR ORGANIZATION I. Policy II. Definition of Labor Organizations and Unions A. Labor Organization 1. Union 2. Workers Association B. Legitimate Labor Organization 1. Legitimate Workers Association C. Company Union III. Union Function and Rationale IV. Government Regulation A. Union Registration: Procedure 1. Requirements and Rationale 2. Action on Application; Denial of Registration 3. Effect of Registration; Nonregistration 4. Rights of Legitimate Labor 95 95 96 96 96 96 98 98 99 101 103 Organization B. Cancellation of Union Certificate of Registration V. International Activities of Union: Prohibition and Regulation VI. Union-Member Relations A. Nature of Relationship B. Issues and Concerns 1. Admission and Discipline of Members 2. Election of Officers; Qualifications; Manner of Election; Tenure and Compensation 3. Compensation 4. Major Policy Matter 5. Union Funds: Payment of Attorneys Fees and Special Assessment 6. Mandatory Activity 7. Union Information 8. Enforcement and Remedies; Procedure and Sanctions VII. Union Affiliation: Local and Parent Union Relations A. Affiliation: Purpose and Nature of Relations 1. Independent Union/Local Union 2. Chartered Local (local/chapter) 3. Affiliate 4. National Union or Federation B. Supervisor/Rank and File Union Affiliation C. Local Union Disaffiliation/Mass Disaffiliation D. Period VIII. Union Security A. Statutory Basis and Rationale B. Validity Agreement and Effect on Freedom of Choice; Types of Union Security Provisions C. Coverage: Worker Inclusion and Exclusion D. Implementation: Obligation and Liabilities E. Financial Security: Agency Shop and Check-Off Chapter 4: THE APPROPRIATE BARGAINING UNIT I. Definition and Role of Law II. Determination of Appropriate Bargaining Unit A. Factors in Unit Determination 1. Community and Mutuality of Interests 2. History 3. Geography Location B. Unit Severance and Globe Doctrine C. Effect of Prior Agreement III. Determining Agency, Arts. 226, 232 115 116 116 117 117 117 117
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Chapter 5: UNION REPRESENTATION I. Pre-Condition: Employer-Employee Relationship II. Methods of Establishing Majority Status III. Certification Election A. Employee as initiating partyin organized and unorganized establishments B. Employer as initiating party C. Responsible agency D. Requisite for validity of election E. Nature of proceeding/ effect of private agreement F. Election process and procedure 1. Petition for Certification Election a. Who may file b. Where to file c. When to file d. Forced Intervenor e. Motion for Intervention f. Preliminary Conference; hearing g. Order 2. Certification Election Mechanics a. Posting of Notice b. Voting List and Voters c. Voting Day d. Protest e. Appeal from Certification Election f. Annulment G. Certification of designated majority union H. Bars to certification election 1. One-Year Bar Rule 2. Negotiation Bar Rule 3. Contract Bar Rule 4. Deadlock Bar Rule I. Suspension of certification election J. Effect of petition for cancellation of union registration Chapter 6: COLLECTIVE BARGAINING: CONCEPT, PROCEDURES AND ISSUES I. General Concepts A. Policy declaration B. Nature and Purpose C. Waiver II. Duty to Bargain A. Meaning of duty B. Deadlock III. Bargaining Procedure A. Private Procedure B. Labor Code Procedure C. Conciliation/Preventive Mediation IV. Bargainable Issues V. Collective Bargaining Agreement A. Definition B. Contents 1. Effect of sub-standard contract C. Registration
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D. Beneficiaries E. Interpretation, administration and enforcement 1. Nature of contract and contract interpretation 2. Grievances a) Contract infirmity b) Contract ambiguity 3. Grievance procedure/ voluntary arbitration F. Contract duration and renewal G. Substitutionary Doctrine H. Arbitrated CBA I. CBA and 3rd party applicability Chapter 7: UNION CONCERTED ACTIVITIES I. Basis of Right to Engage in Concerted Activities A. Constitution B. Statutory C. Limitations II. Types of Concerted Activities A. Strike 1. Definition, nature, purpose 2. Effect on work relationship 3. Types and conversion 4. Grounds 5. Striking party 6. Procedural requirements 7. Test of legality B. Picketing 1. Definition, nature, purpose of picket line 2. Picketing and libel laws 3. Curtailment 4. Regulation/restrictions, innocent third party rule and liabilities 5. Prohibited activities; peaceful picketing C. Slowdown III. Role of Peace Officers During Strikes and Picketing A. Escorting B. Arrest and detention of law violators Chapter 8: EMPLOYER LOCKOUT I. Basis, definition, limitation II. Ground for lockout III. Prohibited lockout IV. Procedural requirements V. Effect of illegal lockout Chapter 9: LABOR INJUNCTION I. Definition and Nature II. General Rule and Exception III. Issuing Agency; Procedural Requirements A. NLRC; Labor Arbiter B. Procedural requirements and rules for issuance of labor injunctions C. TRO Chapter 10: LABOR RELATIONS IN PUBLIC SECTOR
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Table of Contents
LABOR STANDARDS
CHAPTER I: INTRODUCTION TO LABOR LAW I. PRELIMINARY MATTERS A. Definition B. Classifications C. Basis D. Sources of Law E. Other Preliminary Matters II. CONSTITUTIONAL RIGHTS AND LABOR LAW A. Social Justice B. Management and the Constitution: Management Function/Prerogative C. Other Relevant Matters III. LABOR AND CIVIL CODE A. Contracts B. Fair Treatment C. Mutual Obligation D. Compliance With Law E. Obedience of Employee IV. LABOR INTERNATIONAL LAW AND LABOR V. THE LABOR CODE OF THE PHILIPPINES A. Policy Declaration B. Applicability C. Rule-Making Power D. Liberal Interpretation of the Law CHAPTER 2: EXISTENCE OF EMPLOYMENT RELATIONSHIP I. DEFINITION A. Person B. Employee C. Employer D. Managerial Employee II. EMPLOYER-EMPLOYEE RELATIONSHIP A. Factors B. Tests C. Other Factors III. INDEPENDENT CONTRACTOR AND LABOR-ONLY CONTRACTOR A. Statutory Bases B. Independent Contractor C. Labor-Only Contractor D. Liability CHAPTER 3: EMPLOYEE CLASSIFICATION I. STATUTORY BASIS/OVERVIEW OF CLASSIFICATION A. Coverage B. Regular Employment C. Casual Employment D. Probationary Employment E. Project Employment F. Seasonal Employment II. REGULAR EMPLOYEES III. PROJECT EMPLOYEES IV. CASUAL EMPLOYEES V. CONTRACTS FOR FIXED PERIODS VI. SEASONAL EMPLOYEES VII. PROBATIONARY EMPLOYEES 5 5 5 5 5 6 6 6 6 7 7 8 8 8 8 8 8 9 9 9 9 10 10 CHAPTER 4: EMPLOYMENT, RECRUITMENT, AND PLACEMENT OF WORKERS I. STATUTORY BASIS A. Substantive B. Procedural II. RECRUITMENT AND PLACEMENT DEFINED A. Local Employment B. Overseas Employment III. PARTIES INVOLVED A. Workers B. Allowed Entities For Recruitment C. Prohibited Entities IV. GOVERNMENT TECHNIQUES OF REGULATION A. Licensing B. Workers Fees C. Reports/Submission D. Suspension E. Enforcement Powers F. Sanctions V. PROHIBITED PRACTICES VI. ILLEGAL RECRUITMENT A. Local Employment B. Overseas Employment C. Cases VII. JURISDICTION A. Regional Trial Court B. Labor Arbiter C. POEA over administrative cases VIII. ALIEN EMPLOYMENT A. Coverage B. Techniques of Regulation C. DOLE Guidelines For Issuance of Alien Employment Permit IX. DEVELOPMENT OF HUMAN RESOURCES A. Human Resources Development B. Training and Development of Special Workers CHAPTER 5: CONDITIONS OF LABOR I. COVERAGE A. General rule B. Not covered II. HOURS OF WORK A. Normal hours of work B. Compensable hours of work--in general C. General principles in determining if time is considered as hours worked D. Specific rules determining hours of work and compensability E. Overtime work F. Night Work III. WEEKLY REST DAYS A. Coverage B. Scheduling rest day C. Compulsory work D. Premium pay IV. HOLIDAYS A. Coverage and exclusion B. Holidays covered
LABOR STANDARDS
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C. Holiday pay computation D. Absences E. Non-working/scheduled rest day V. SERVICE INCENTIVE LEAVE A. Coverage and exemption B. Entitlement VI. PATERNAL LEAVE VII. PARENTAL LEAVE VIII. VICTIMS LEAVE CHAPERT 6: WAGES I. WAGES GENERAL CONCEPT A. Definition of Wage B. Coverage C. No work No Pay D. Equal Pay for Equal Work / Non Discrimination E. Facilities and supplements F. Commission G. Wages and Salary H. Gratuity I. Payment by results II. MINIMUM WAGES AND WAGE FIXING MACHINERY A. Constitutional Basis B. Agencies for Wage-Fixing Machinery C. Minimum Wages and Criteria D. Non-Diminution Rule E. Wage Distortion F. Special Cases G. Summary of Effects on Wages III. PAYMENT OF WAGES A. Form of Payment B. Time of Payment C. Place of Payment D. Direct Payment E. Contractor Subcontractor F. Prohibition Regarding Wages IV. OTHER FORMS OF REMUNERATION A. Service Charges B. 13th Month Pay C. Bonus D. Productivity Incentives V. WAGE RECOVERY, LIABILITIES, AND WORKER PREFERENCE A. Worker Preference in Case of Bankruptcy B. Attorneys Fees CHAPTER 7: WORKING CONDITIONS FOR SPECIAL GROUPS I. WOMEN WORKERS A. Women Under the Constitution B. Coverage C. Prohibited Acts D. Facilities E. Family Planning Services F. Classification of Certain Women Workers G. Maternity Leave H. Sexual Harassment II. MINORS A. Constitutional Basis B. Minimum Employable Age C. Prohibition of Certain Kinds of
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Work D. Employment of Children from 15 to 18 E. Hours of Work of a Working Child III. HOUSEHELPERS A. Definition B. Conditions of employment and other rights of the househelper IV. HOMEWORKERS A. Coverage B. Payment for Homework C. Prohibitions for Homework CHAPTER 8: TERMINATION OF EMPLOYMENT I. SECURITY OF TENURE IN GENERAL A. Definition B. Nature C. Coverage D. Conflict with Management Prerogatives II. TERMINATION BY EMPLOYEE A. Termination by Employee with Just Cause B. Termination by Employee without Just Cause C. Resignation D. No Termination III. TERMINATION BY EMPLOYER A. Just Causes (Substantive Due Process) 1. Serious misconduct 2. Willful disobedience 3. Gross or habitual neglect of duties 4. Fraud or willful breach of trust 5. Commission of a crime or offense 6. Analogous Causes 7. Constructive Discharge/Dismissal 8. Preventive Suspension B. Authorized Causes (Substantive Due Process) 1. Installation of labor saving devices 2. Redundancy 3. Retrenchment to prevent losses 4. Closing or cessation of operation 5. Disease C. Procedural Due Process 1. General Concepts 2. Consequences of NonCompliance 3. Right to Counsel 4. Notice 5. Hearing 6. Burden of Proof 7. Degree of Proof 8. Prescription Period D. Consequences and Remedies in Illegal Dismissal
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LABOR STANDARDS
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Table of Contents
1. 2. 3. 4. 5. 6. 7.
Reinstatement Backwages Separation Pay Financial Assistance Damages and Other Indemnity Liability of Corporate Officers Guidelines on Imposition of Dismissal and Other Penalties 86 86 88 88 88 88 88 89 89 89 89 89 89 89 89 89 89 90 90 90 90 90 90 91 91 91 91 91 91 91 91 91 92 92 92 92 92 92
LABOR STANDARDS
CHAPTER 9: WELFARE LEGISLATION I. COMPARISON: SSS AND GSIS II. BENEFITS UNDER THE SSS A. Computation of Pension B. Retirement C. Death D. Permanent Disability E. Funeral benefit F. Sickness G. Maternity H. Loan III. SSS: Effect of Non-reporting and Non-remittance of Contributions A. To the Employee B. To the Employer C. To the Self-employed D. To the Self-employed and Voluntary Member E. Change of Membership Category IV. BENEFITS UNDER THE GSIS A. Monthly Pension B. Separation Benefits C. Unemployment Benefits D. Retirement Benefits E. Permanent Disability Benefits F. Temporary Disability Benefits G. Survivorship Benefits H. Death Benefits I. Funeral Benefits J. Life Insurance K. Loan V. LIMITED PORTABILITY SCHEME UNDER RA 7699 A. Who is covered? B. What happens? C. Why? D. Overlapping periods VI. NATIONAL HEALTH INSURANCE ACT A. Who is covered? B. Who are dependents C. Benefits
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Chapter 1. Introduction to Labor Law
Labor Standards
We would like to thank and acknowledge Prof. Domingo P. Disini, Jr., Prof. Patricia R.P. Salvador-Daway, Prof. E. (Leo) Battad and Atty. Francis Sobrevias for allowing the UP Professional Enhancement Program Writers and Editors as well as the Bar Operations Commission Academics Committee to use and consult their respective Labor Law outlines.
LABOR STANDARDS
FACULTY-STUDENT EDITORIAL BOARD AND LECTURES COMMITTEE Prof. E. (Leo) Battad

FACULTY EDITOR
LABOR & SOCIAL LEGISLATION Fame Cruz

SUBJECT EDITORS
LECTURES Edel Cruz

HEAD
ACADEMICS COMMITTEE Samantha Poblacion

DIRECTOR FOR ACADEMICS EDITOR-IN-CHIEF
LABOR STANDARDS Patrich Leccio

LEAD WRITER
Jason Mendoza
DEPUTY HEAD
Rania Joya
DEPUTY DIRECTOR FOR ACADEMICS LAYOUT HEAD
Malds Menzon
LOGISTICS, HR
-------Kae Guerrero
PRINTING AND DISTRIBUTION
Niner Guiao Jake del Puerto Sopfia Guira

WRITER
-------Leo Zulueta
LOGO, COVER AND TEMPLATE DESIGN

I. PRELIMINARY MATTERS A. Definition B. Classifications C. Basis D. Sources of Law E. Other Preliminary Matters II. CONSTITUTIONAL RIGHTS AND LABOR LAW A. Social Justice B. Management and the Constitution: Management Function/Prerogative C. Other Relevant Matters III. LABOR AND CIVIL CODE A. Contracts B. Fair Treatment C. Mutual Obligation D. Compliance With Law E. Obedience of Employee IV. LABOR INTERNATIONAL LAW AND LABOR V. THE LABOR CODE OF THE PHILIPPINES A. Policy Declaration B. Applicability C. Rule-Making Power D. Liberal Interpretation of the Law
B. CLASSIFICATIONS 1. Labor Standards Maternity Childrens Hospital vs. Sec. of Labor (1989): minimum requirements prescribed by existing laws, rules and regulations relating to wages, hours of work, cost-of-living allowance, and other monetary and welfare benefits, including occupational safety and health standards. 2. Labor Relations regulates the institutional relationship between the workers organized into a union and the employers. 3. Welfare Laws designed to take care of contingencies that may arise and affect the workers. C. BASIS
1987 Constitution Art. II Sec. 5: The maintenance of peace and order, the protection of life, liberty, and property, and promotion of the general welfare are essential for the enjoyment by all the people of the blessings of democracy. Art. II Sec. 18: The State affirms labor as a primary social economic force. It shall protect the rights of workers and promote their welfare. Art. XIII Sec.1: The Congress shall give highest priority to the enactment of measures that protect and enhance the right of all the people to human dignity, reduce social, economic, and political inequalities, and remove cultural inequities by equitably diffusing wealth and political power for the common good. To this end, the State shall regulate the acquisition, ownership, use, and disposition of property and its increments.
I. PRELIMINARY MATTERS
A. DEFINITION Labor Law the law governing the rights and duties of the employer and employees: with respect to the terms and conditions of employment, and th respect to labor disputes arising from collective bargaining respecting terms and conditions.
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D. SOURCES OF LAW 1. Labor Code and related special legislation 2. Contracts a. (Art.1305, Civil Code): meeting of the minds b. (Art.1306, CC): stipulations deemed convenient, provided not contrary to law, morals, public order, public policy 3. DOLE Philippines vs. Pawis ng Makabayang Obrero (2003): Collective Bargaining Agreements 4. Mcleod vs. NLRC (2007): That at one time PMI reimbursed McLeod for his and his wifes plane tickets in a vacation to London could not be eemed as an established practice. To be considered a "regular practice," the giving of the benefits should have been done over a long period, and must be shown to have been consistent and deliberate. 5. Suico vs. NLRC (2007): Company policies or practices are binding on the parties. Some can ripen into an obligation on the part of the employer, such as those which confer benefits on employees, or regulate the procedures and requirements for their termination. E. OTHER PRELIMINARY MATTERS 1. Law and Worker - Cebu Royal Plant vs. Deputy Minister of Labor (1989): SC reaffirmed its concern for the lowly worker who, often at the mercy of his employer must look up to the law for his protection. 2. Labor Case - Lapanday Agricultural Devt vs. CA (2001): Not every relation between management and labor is a labor case. Definition is strict. It is only a labor case if it deals with the Labor Code, CBA, and its associated laws/legislation. 3. Case Decision - Villarama vs. CA (2006): It should faithfully comply with Section 14, Article VIII of the Constitution which provides that no decision shall be rendered by any court (or quasi-judicial body) without expressing therein clearly and distinctly the facts of the case and the law on which it is based.
4. Compromise and Waiver

Labor Code Art. 227 : Any compromise settlement, including those involving labor standard laws, voluntarily agreed upon by the parties with the assistance of the Bureau or the regional office of the Department of Labor, shall be final and binding upon the parties. The National Labor Relations Commission or any court, shall not assume jurisdiction over issues involved therein except in case of non-compliance thereof or if there is prima facie evidence that the settlement was obtained through fraud, misrepresentation, or coercion. SEE ALSO: Civil Code Arts. 2028, 2036
LABOR STANDARDS
Soriano Jr. vs. NLRC (07): Generally, deeds of release, waiver or quitclaims cannot bar employees from demanding benefits to which they are legally entitled or from contesting the legality of their dismissal since quitclaims are looked upon with disfavor and are frowned upon as contrary to public policy. Where, however, the person making the waiver has done so voluntarily, with a full understanding thereof, and the consideration for the quitclaim is credible and reasonable, the transaction must be recognized as being a valid and binding undertaking. The requisites for a valid quitclaim are: there was no fraud or deceit on the part of any of the parties; the consideration for the quitclaim is credible and reasonable; and the contract is not contrary to law, public order, public policy, morals or good customs or prejudicial to a third person with a right recognized by law.
II. CONSTITUTION LAW

A. SOCIAL JUSTICE
AND
LABOR
1987 Constitution Art. II Sec. 10: The State shall promote social justice in all phases of national development. SEE: Art XIII Sec. 1 and 2, PAGE 1 and 2
1. General Definition- Calalang vs. Williams (1940): Social Justice is neither communism, nor despotism, nor atomism, nor anarchy, but the humanization of laws and the equalization of social and economic
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forces by the State so that justice in its rational and objectively secular conception may at least be approximated. 1987 Constitution LABOR FORCE-Art. II Sec. 18: The State
affirms labor as a primary social economic force. It shall protect the rights of workers and promote their welfare. PROTECTION TO LABOR-Art. XIII Sec. 1: SEE PAGE 1 Sec. 2: The promotion of social justice shall include the commitment to create economic opportunities based on freedom of initiative and self-reliance. Sec. 3: The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all. It shall guarantee the rights of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted activities, including the right to strike in accordance with law. They shall be entitled to security of tenure, humane conditions of work, and a living wage. They shall also participate in policy and decision-making 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.
B. MANAGEMENT AND THE CONSTITUTION; MANAGEMENT FUNCTION/PREROGATIVE 1. Phil. Geothermal Inc. vs. NLRC (1994): The law in protecting the rights of the employees authorizes neither oppression nor self-destruction of the employer. It should be made clear that when the law tilts the scale of justice in favor of labor, it is but a recognition of the inherent economic inequality between labor and management. Never should the scale be so tilted if the result is an injustice to the employer. 2. Torreda vs. Toshiba (2007): This Court held that 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. This is a management prerogative, where the free will of management to conduct its own affairs to achieve its purpose takes form. 3. Tinio vs. CA (2007): 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 the right is exercised. C. OTHER RELEVANT MATTERS 1. Due Process - Salaw vs. NLRC (1991): Due process requirements are two-fold substantive (dismissal should be for a valid and authorized cause as provided by law) and procedural (due notice and hearing). 2. Labor As Property Right - Sibal vs. Notre Dame of Greater Manila (1990): Ones employment is a property right, and the wrongful interference therewith is an actionable wrong. 3. Liberty of Contract/Laissez Faire Leyte Land Transportation Co. v Leyte Farmers & Workers Union (1948): The prohibition to impair the obligation of contracts is not absolute and unqualified. In spite of the constitutional prohibition and the fact that both parties are of full age and competent to contract, it does not necessarily deprive the State of the
LABOR STANDARDS
2. Limits of Social Justice - Agabon vs. NLRC (2004): Social justice should be used only to correct an injustice. It must be founded on the recognition of the necessity of interdependence among diverse units of a society, and of the protection that should be equally and evenly extended to all groups as a combined force in our social and economic life. As partners in nationbuilding, labor and management need each other to foster productivity and economic growth; hence, the need to weigh and balance the rights and welfare of both the employee and employer.
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power to interfere where the parties do not stand upon an equality, or where the public health demands that one party to the contract shall be protected against himself. Employees Confederation of the Philippines vs. NWPC (1991): The Constitution is primarily a document of social justice, and although it has recognized the importance of the private sector, it has not embraced fully the concept of laissez-faire or relied on pure market forces to govern the economy. 4. Welfare State - Alalayan vs. National Power Corporation (1968): The welfare state concept is found in the constitutional clause on the promotion of social justice to ensure the well-being and economic security of all the people, and in the pledge of protection to labor with specific authority to regulate the relations between landowners and tenants and between labor and capital. 5. Participation In Decision-Making Process - Phil. Airlines Inc. vs. NLRC (1993): Verily, a line must be drawn between management prerogatives regarding business operations per se and those which affect the rights of the employees. In treating the latter, management should see to it that its employees are at least properly informed of its decisions or modes action. Indeed, industrial peace cannot be achieved if the employees are denied their just participation in the discussion of matters affecting their rights.
with public interest. Inasmuch as in this particular instance the contract in question would have been deemed in violation of pertinent labor laws, the provisions of said laws would prevail over the terms of the contract, and private respondent would still be entitled to overtime pay. B. FAIR TREATMENT - General Bank and Trust Co. Vs. Ca (1985): the right of an employer to dismiss an employee differs from and should not be confused with the manner in which such right is exercised. It must not be oppressive and abusive since it affects one's person and property. C. MUTUAL OBLIGATION - Firestone Tire And Rubber Co. Vs. Lariosa (1987): the employer's obligation to give him workers just compensation and treatment carries with it the corollary right to expect from the workers adequate work, diligence and good conduct. D. COMPLIANCE WITH LAW - Sarmiento vs. Tuico (1988): it is also important to emphasize that the return-to-work order not so much confers a right as it imposes a duty; and while as a right it may be waived, it must be discharged as a duty even against the worker's will. E. EES COMPLIANCE AND OBEDIENCE TO ERS ORDERS - Pcib vs. Jacinto (1991): the lack of a written or formal designation should not be an excuse to disclaim any responsibility for any damage suffered by the employer due to his negligence. The measure of the responsibility of an employee is that if he performed his assigned task efficiently and according to the usual standards, then he may not be held personally liable for any damage arising therefrom. Failing in this, the mployee must suffer the consequences of his negligence if not lack of due care in the performance of his duties.
LABOR STANDARDS
III.
LABOR AND CIVIL CODE
Civil Code Art. 1700: The relations between capital and labor are not merely contractual. They are so impressed with public interest that labor contracts must yield to the common good. Therefore, such contracts are subject to the special laws on labor unions, collective bargaining, strikes and lockouts, closed shop, wages, working conditions, hours of labor and similar subjects Art. 1701: Neither capital nor labor shall act oppressively against the other, or impair the interest or convenience of the public.
A. CONTRACTS - Pal Employees Savings And Loan Assn., Inc. Vs. NLRC (1996): Under the civil code, contracts of labor are explicitly subject to the police power of the state because they are not ordinary contracts but are impressed
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IV.LABOR INTERNATIONAL LAW AND LABOR

Universal Declaration of Human Rights Arts: 3, 7, 17, 22, 23, 24, 25 International Covenant on Economic, Social and Cultural Rights: Part III Arts. 6, 7, 9, 11 International Covenant on Civil and Political Rights: Part II Art. 8 Conventions and Recommendations of the International Labor Organization (ILO)
a. Government Owned and Controlled Corporations (GOCCS) Cabrera vs. NLRC (1991): The rule is that only government-owned or controlled corporations with original charters come under the Civil Service. Since NASECO is organized under the Corporation Law and not by virtue of a special legislative charter, its relations with its personnel are governed by the Labor Code and come under the jurisdiction of the NLRC.
LABOR STANDARDS
International School Alliance of Educators vs. Quisumbing (2000): International law, which springs from general principles of law, likewise proscribes discrimination. General principles of law include principles of equity, i.e., the general principles of fairness and justice, based on the test of what is reasonable. Numerous treaties embody the general principle against discrimination, the very antithesis of fairness and justice. The Philippines, through its Constitution, has incorporated this principle as part of its national laws.
Labor Code Art 5: The Department of Labor and other government agencies charged with the administration and enforcement of this Code or any of its parts shall promulgate the necessary implementing rules and regulations. Such rules and regulations shall become effective fifteen (15) days after announcement of their adoption in newspapers of general circulation. b. Religious Corporations Austria vs. NLRC (1998): The Labor Code does not cover ecclesiastical affairs, defined as one which involves the relationship between the church and its members and relate to matters of faith, religious doctrines, worship and governance of the congregation. However, the Labor Code is comprehensive enough to include religious corporations on its secular affairs, as provided by Article 278 of the Labor Code which states that the provisions of this Title shall apply to all establishments or undertakings, whether for profit or not. Obviously, the cited article does not make any exception in favor of a religious corporation.
V. THE LABOR CODE OF THE PHILIPPINES

A. POLICY DECLARATION- (SEE ART. XIII, SEC. 3, PAR. 2)
B. APPLICABILITY 1. General Rule Labor Code Art. 6: All rights and benefits granted to workers under this Code shall, except as may otherwise be provided herein, apply alike to all workers, whether agricultural or non-agricultural. Art. 276: The terms and conditions of employment of all government employees, including employees of government-owned and controlled corporations, shall be governed by the Civil Service Law, rules and regulations. Their salaries shall be standardized by the National Assembly as provided for in the New Constitution. However, there shall be no reduction of existing wages, benefits and other terms and conditions of employment being enjoyed by them at the time of the adoption of this Code. 2. Examples of Entities Included
3. Examples of Exceptions: a. International Agencies Ebro III vs. NLRC (1996): In order to assure independence, they are immune from suit, thus, Phil. Laws do not apply to them. ... The grant of immunity is by virtue of the Convention on the Privileges and Immunities of Specialized Agencies of the U.N., which has become part of the law of the land under the Constitution.
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b. School Teachers National Mines and Allied Workers Union vs. NLRC (1998): [SCHOOL TEACHERS] on issues where the manual expressly provides for the rules, such as probationary employment, the labor code does not apply. On issues where the manual is silent, such as termination of school teachers, the labor code applies.
D. LIBERAL INTERPRETATION OF THE LAW

LABOR STANDARDS
Applicability Not of universal application. only applies to: All workers agricultural and nonagricultural GOCCs organized under general laws e.g. Corporation Code All branches of government, and GOCCs, profit or non profit organizations ONLY with regard to wages All private and government employees ONLY with regard to Employees Compensation and State Insurance Fund Not Applicable to the ff.: Government employees should be Civil Service Law and EO 180 GOCC with original charter Art. 9 B, Sec. 2(1) of the Constitution International Agencies and specialized agencies or UN treaty or international conventions grant of immunity from suit (ex. IRRI, ICMC) by specific treaty grant of immunity, but such treaty must include provisions for resolution of disputes if injustice is created due to exemption from suit the REMEDY is to ask the Philippine Government to withdraw the
1. Rationale Asian Transmission Corporation vs. CA (2004): Art. 4 of the Labor Code provides that all doubts in the implementation and interpretation of its provisions, including its implementing rules and regulations, shall be resolved in favor of labor. For the working mans welfare should be the primordial and paramount consideration. 2. Exceptions a. Estoppel Duncan Association vs. Glaxo Wellcome (2004): The policy being questioned is not a policy against marriage. An employee of the company remains free to marry anyone of his or her choosing. However, an employees personal decision does not detract the employer from exercising management prerogatives to ensure maximum profit and business success. The assailed company policy which forms part of respondents Employee Code of Conduct and of its contracts with its employees, such as that signed by Tescon, was made known to him prior to his employment. Since Tecson knowingly and voluntarily entered into a contract of employment with Glaxo, the stipulations therein have the force of law between them and, thus, should be complied with in good faith. He is therefore estopped from questioning said policy. b. No Doubt Bonifacio vs. GSIS (1986): While we do not dispute that under the law, in case of doubt in the implementation and interpretation of the provisions of the Labor Code, including its implementing rules and regulations, the doubt shall be resolved in favor of the laborer, we find the same has no application in this case since the pertinent provisions of the Labor Code leave no room for doubt either in their interpretation or application. c. No Sweeping Interpretations Bravo vs. ECC (1986): The SC cannot adopt a sweeping interpretation of the law in favor of labor lest we engage in judicial legislation.
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grant of immunity from suit. c. Managerial Employees Penaranda vs. Baganga Plywood (2004): Petitioner was not a managerial employee. However, he 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 law on labor standards.
C. RULE-MAKING POWER 1. Limitations a. must be issued under authority of law b. must not be contrary to law and the constitution (stated differently, must not, in effect, amend the Labor Code, Constitution or other laws in promulgating such rules and regulations)
d. Relevant Facts/Rationality PAL vs. NLRC (1991): [The] care and solicitude [for protection of laborers rights] cannot justify disregard of relevant facts or eschewal of rationality in the construction of the text of applicable rules in order to arrive at a disposition in favor of an employee. e. Equity Manning International Corp. vs. NLRC (1991): The rule embodied in the Labor Code is that a person dismissed for cause as defined therein is not entitled to separation pay. The cited cases constitute the exception, based on 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 express provision of the labor laws allowing dismissal of employees for cause and without any provision for separation pay. f. Balancing Conflicting Claims Duncan Association vs. Glaxo Wellcome (2004): No less than the Constitution recognizes the right of enterprises to adopt and enforce such a policy to protect its right to reasonable returns on investments and to expansion and growth. Indeed, while our laws endeavor to give life to the constitutional policy on social justice and the protection of labor, it does not mean that every labor dispute will be decided in favor of the workers. The law also recognizes that management has rights which are also entitled to respect and enforcement in the interest.
LABOR STANDARDS
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Chapter 2. Existence of Employment Relationship

I. DEFINITION A. Person B. Employee C. Employer D. Managerial Employee II. EMPLOYER-EMPLOYEE RELATIONSHIP A. Factors B. Tests C. Other Factors III. INDEPENDENT CONTRACTOR AND LABOR-ONLY CONTRACTOR A. Statutory Bases B. Independent Contractor C. Labor-Only Contractor D. Liability
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.
LABOR STANDARDS
D.
MANAGERIAL EMPLOYEES
I. DEFINITIONS
A. PERSON
Labor Code Art 97(a): an individual, partnership, association, corporation, business trust, legal representatives, or any organized group of persons.
United Pepsi-Cola Supervisory Union vs. Laguesma (1998): Those who act in the interest of the employer in supervising rank-and-file employees 1. Managers per se those who have the authority to devise, implement and control strategic and operational policies (top and middle managers) 2. Supervisors those whose task is to ensure that such policies are carried out by the rank-and-file employees of an organization (first-level managers/ supervisors)
II. EMPLOYER-EMPLOYEE RELATIONSHIP

A. FACTORS 1. General Rule The four-fold test is composed of four elements. This test is the yardstick to determine employeremployee relationship: a. selection and engagement of the employee; b. payment of wages; c. power of dismissal; and d. employers power to control the employees conduct (AZUCENA, 2007) 2. Factual Test Remington Industrial Sales Corp. vs. Castaneda (2007): It is wrong to say that if the work is not directly related to the employer's business, then the person performing such work could not be considered an employee of the latter. Determination of the existence of an employer-employee relationship is defined by law according to the facts of each case, regardless of the nature of the activities involved. In this case, respondent was made to cook meals for the petitioners employees, which work ultimately redounded to the benefit of the petitioner. She was not merely a domestic worker of Mr. Tans family.
B. EMPLOYER
Art. 97 (b): any person acting directly or indirectly in the interest of an employer in relation to an employee and shall include the government and all its branches, subdivisions and instrumentalities, all government-owned or controlled corporations and institutions, as well as non-profit private institutions, or organizations. Art. 167 (f): means any person, natural or juridical, employing the services of the employee. Art. 212 (e): includes any person acting in the interest of an employer, directly or indirectly. The term shall not include any labor organization or any of its officers or agents except when acting as employer.
C. EMPLOYEE
Art. 97 (c): includes any individual employed by an employer Art. 167 (g): any person compulsorily covered by the GSIS under Commonwealth Act Numbered One hundred eighty-six, as amended, including the members of the Armed Forces of the Philippines, and any person employed as casual, emergency, temporary, substitute or contractual, or any person compulsorily covered by the SSS under Republic Act Numbered Eleven hundred sixty-one, as amended. Art. 212) (f): any person in the employ of an employer. The term shall not be limited to the employees of a particular employer. It shall include any individual whose work has ceased
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3. Proof Required Domasig vs. NLRC (1996): It has long been established that in administrative and quasi- judicial proceedings, substantial evidence is sufficient as a basis for judgment on the existence of er-ee relationship. No particular form of evidence is required to prove the existence of such relationship. Any competent and relevant evidence to prove the relationship may be admitted. Substantial evidence has been defined to be such relevant evidence as a reasonable mind might accept as adequate to support a conclusion, and its absence is not shown by stressing that there is contrary evidence on record, direct or circumstantial xxx. B. TESTS OF EMPLOYMENT 1. Control Test Sonza vs. ABS-CBN Broadcasting Corp. (2004): Applying the control test to the present case, we find that SONZA is not an employee but an independent contractor. The control test is the most important test our courts apply in distinguishing an employee from an independent contractor. This test is based on the extent of control the hirer exercises over a worker. The greater the supervision and control the hirer exercises, the more likely the worker is deemed an employee. The converse holds true as well the less control the hirer exercises, the more likely the worker is considered an independent contractor. Being an exclusive talent does not by itself mean that SONZA is an employee of ABSCBN. Even an independent contractor can validly provide his services exclusively to the hiring party. In the broadcast industry, exclusivity is not necessarily the same as control. Insular Life vs. NLRC (1989): Not every form of control that the hiring party reserves to himself over the conduct of the party hired in relation to the services rendered establishes an employer-employee relationship. The line should be drawn between rules that merely serve as guidelines towards the achievement of the mutually-desired result without dictating the means or methods to be employed in attaining it, and those that control or fix the
methodology and bind or restrict the party hired to the use of such means. The first, which aim only to promote the result, create no employer-employee relationship unlike the second, which address both the result and the means used to achieve it. Abante vs. Lamadrid (2004): Abante was a commission salesman who received % commission of his gross sales. Yet no quota was imposed on him, such that a dismal performance or dead result will not result in any sanction or dismissal. He was not required to report to the office at any time or submit any periodic written report on his sales performance and activities. He had Mindanao as his base of operation, but he was not designated to conduct his sales activities at any particular or specific place. Respondent did not prescribe the manner of selling the merchandise. He occasionally reported to Manila to attend conferences on marketing strategies, not to control the manner and means to be used in reaching the desired end, but to serve as a guide and to upgrade his skills for more efficient marketing performance. Where a person who works for another does so more or less at his own pleasure and is not subject to definite hours or conditions of work, and in turn is compensated according to the result of his efforts and not the amount thereof, no employer-employee relationship exists.
LABOR STANDARDS
2. Economic Test Francisco vs. NLRC (2006): In Sevilla v. CA, the Court considered existing economic conditions prevailing between the parties, in addition to the standard of right-of-control, to give a clearer picture in determining the existence of an employeremployee relationship, based on an analysis of the totality of economic circumstances of the worker. Thus, the determination of the relationship depends upon the circumstances of the whole economic activity, such as: the extent to which the services performed are an integral part of the employers business; the extent of the workers investment in equipment and facilities;
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the nature and degree of control exercised by the employer; the workers opportunity for profit and loss; the amount of initiative, skill, judgment or foresight required for the success of the claimed independent enterprise; the permanency and duration of the relationship between the worker and the employer; and the degree of dependency of the worker upon the employer for his continued employment in that line of business.
work for his compensation is measured by the number of sales he makes. 3. Payment of Wages Villuga vs. NLRC (1993):The fact that employees are paid on a piece-rate basis is no argument that they were not employees. The law broadly defines wages as remunerations or earnings, capable of being expressed in terms of money whether fixed or ascertained on a time, task, piece or commission basis. Lazaro vs SSS (2004): The fact that employee was paid by way of commission does not preclude the existence of an employer-employee relationship. 4. ID Card Lopez vs. Bodega City (2007): Petitioner insists that her ID card is sufficient proof of her employment. In Domasig v. NLRC this Court held that the complainant's ID card and the cash vouchers covering his salaries for the months indicated therein were substantial evidence that he was an employee of respondents, especially since the latter failed to deny said evidence. This is not the situation in the present case. The only evidence presented by Lopez as proof of her alleged employment are her ID card and one petty cash voucher for a fiveday allowance which were disputed by respondents. 5. Dismissal/Denial R Transport vs. Ejandra (2004): Petitioner is barred to negate the existence of an employer-employee relationship. In its petition filed before this Court, petitioner invoked our rulings on the right of an employer to dismiss an employee for just cause. Petitioner maintained that private respondent was justifiably dismissed due to abandonment of work. By adopting said rulings, petitioner impliedly admitted that it was in fact the employer of private respondent. According to the control test, the power to dismiss an employee is one of the indications of an employeremployee relationship. Petitioners claim that private respondent was legally dismissed for abandonment was in fact a negative pregnant: an
LABOR STANDARDS
C. OTHER FACTORS 1. Agreement San Miguel vs. Abella (2005): The contract of services between MAERC and SMC provided that MAERC was an independent contractor and that the workers hired by it "shall not, in any manner and under any circumstances, be considered employees of the Company, and that the Company has no control or supervision whatsoever over the conduct of the Contractor or any of its workers in respect to how they accomplish their work or perform the Contractor's obligations under the Contract." In deciding the question of control, the language of the contract is not determinative of the parties' relationship; rather, it is the totality of the facts and surrounding circumstances of each case. Thus, the existence of an employeremployees relation is a question of law and being such, it cannot be made the subject of agreement. 2. Hours of Work Lazaro vs. SSS (2004): Neither does it follow that a person who does not observe normal hours of work cannot be deemed an employee. In Cosmopolitan Funeral Homes, Inc. v. Maalat, the employer similarly denied the existence of an employer-employee relationship, as the claimant according to it, was a supervisor on commission basis who did not observe normal hours of work. This Court declared that there was an employer-employee relationship, noting that [the] supervisor, although compensated on commission basis, [is] exempt from the observance of normal hours of
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acknowledgement that there was no mutual termination of the alleged contract of lease and that private respondent was its employee.
III.INDEPENDENT CONTRACTOR AND LABOR-ONLY CONTRACTOR

A. STATUTORY BASES (LABOR CODE: ART 106-109; RULE VIII-A, BOOK III; OMNIBUS RULES.) NOTE: Department Order No. 10, 1997,
which was incorporated in Rule VIII-A (Contracting and Subconracting) of the Omnibus Rules, has been revoked by Department Order No. 3, 2001. Hence, the positive characteristics of independent contracting are no longer stated. Rule VIII-A furthermore has been revised by Department Order No. 18, 2002. Department Order No. 3, 2001 however, has stated that it shall continue to prohibit labor-only contracting.
2. Job Contracting Lakas vs. Burlingame Corp (2007): Job contracting is permissible only if the following conditions are met: the contractor carries on an independent business and undertakes the contract work on his own account under his own responsibility according to his own manner and method, free from the control and direction of his employer or principal in all matters connected with the performance of the work except as to the results thereof; and the contractor has substantial capital or investment in the form of tools, equipment, machineries, work premises, and other materials which are necessary in the conduct of the business. 3. Factors to Determine Existence of Independent Contractor Relationship Mafinco vs. Ople (1976): a. Whether the contractor is carrying on an independent business. b. Whether the work is part of the employers general business. c. The nature and extend of the work. d. The skill required. e. The terms and duration of the relationship. f. The right to assign the performance of the work to another. g. The control and supervision of the work and the employers powers with respect to the hiring, firing and payment of salaries. h. The duty to supply premises, tools, and appliances. 4. Example Manila Electric Co. vs Benamira (2005): Respondents never alleged that MERALCO was their employer. Under the security service agreement, it was ASDAI which: a. selected, engaged or hired and discharged the security guards b. assigned them to MERALCO according to the number agreed upon; c. provided the uniform, firearms and ammunition, nightsticks, flashlights, raincoats and other paraphernalia of the security guards; d. paid them salaries or wages; and, e. disciplined and supervised them or principally controlled their conduct.
LABOR STANDARDS
B. INDEPENDENT CONTRACTOR: 1. Requisites

Art. 106 (par. 1 and 2): Whenever an employer enters into a contract with another person for the performance of the formers work, the employees of the contractor and of the latters subcontractor, if any, shall be paid in accordance with the provisions of this Code. 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. Art 107: The provisions of the immediately preceding article shall likewise apply to any person, partnership, association or corporation which, not being an employer, contracts with an independent contractor for the performance of any work, task, job or project. Art. 109: The provisions of existing laws to the contrary notwithstanding, every employer or indirect employer shall be held responsible with his contractor or subcontractor for any violation of any provision of this Code. For purposes of determining the extent of their civil liability under this Chapter, they shall be considered as direct employers.
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The fact that MERALCO reserved the right to seek replacement of any guard whose behavior or appearance is unsatisfactory, merely confirms that the power to discipline lies with the agency. The stipulation that the agency cannot pull out any security guard from MERALCO without its consent is simply a security clause designed to prevent the agency from unilaterally removing its security guards from MERALCOs premises to the latters detriment. The agreement provides that the agency is principally mandated to conduct inspections, without prejudice to MERALCOs right to conduct its own inspections.
C. LABOR-ONLY CONTRACTOR 1. Requisites

Art 106 (par. 4): There is "labor-only" contracting where the person supplying workers to an employer does not have substantial capital or investment in the form of tools, equipment, machineries, work premises, among others, and the workers recruited and placed by such person are performing activities which are directly related to the principal business of such employer. In such cases, the person or intermediary shall be considered merely as an agent of the employer who shall be responsible to the workers in the same manner and extent as if the latter were directly employed by him. SEE: ART. 109, Page 5 DO No. 18-02, Section 5: Labor-only contracting is hereby declared prohibited. For this purpose, labor-only contracting shall refer to an arrangement where the contractor or subcontractor merely recruits, supplies or places workers to perform a job, work or service for a principal, and any of the following elements are present: i. The contractor or subcontractor does not have substantial capital or investment which relates to the job, work or service to be performed and the employees recruited, supplied or placed by such contractor or subcontractor are performing activities which are directly related to the main business of the principal; or ii. The contractor does not exercise the right to control over the performance of the work of the contractual employee. "Substantial capital or investment" refers to capital stocks and subscribed capitalization in the case of corporations, tools, equipment, implements, machineries and work premises, actually and directly used by the contractor or subcontractor in the performance or completion of the job, work or service contracted out. 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.
LABOR STANDARDS
5. When Independent Contractor and Not Employee Manila Electric Co. vs. Quisumbing (1999): We recognize that contracting out is not unlimited; rather, it is a prerogative that management enjoys subject to well-defined legal limitations. As we have previously held, the company can determine in its best business judgment whether it should contract out the performance of some of its work for as long as the employer is motivated by good faith, and the contracting out must not have been resorted to circumvent the law or must not have been the result of malicious or arbitrary action. Coca-Cola Bottlers Phil. Inc. vs. NLRC (1999): We perceive at the outset the disposition of the NLRC that janitorial services are necessary and desirable to the trade or business of petitioner CocaCola. But this is inconsistent with our pronouncement in Kimberly Independent Labor Union v. Drilon where the Court took judicial notice of the practice adopted in several government and private institutions and industries of hiring janitorial services on an independent contractor basis. In this respect, although janitorial services may be considered directly related to the principal business of an employer, as with every business, we deem them unnecessary in the conduct of the employers principal business.
2. Effect of Finding Industrial Timber Corporation vs. NLRC (1997): If found to be Labor only contractor, it is equivalent to finding that there exists an employer-employee relationship between the owner of the project and the employees of the laboronly contractor since that relationship is defined and prescribed by the law itself. 3. Example Aboitiz Haulers vs. Dimapatoi (2006):
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The allegation of petitioner that Grigio is an independent job contractor is without basis. The respondents, as checkers, were employed to check and inspect cargo, a task which is clearly necessary for the petitioners business of forwarding and distributing cargo. Grigio did not undertake the performance of its service contract according to its own manner and method, free from the control and supervision of its principal. The work activities, shifts, and schedules of the respondents, including time allowed for "recess" were set under the Written Contract of Services. This clearly indicates that these matters, which consist of the means and methods by which the work is to be accomplished, were not within the absolute control of Grigio. Petitioners allegation that Grigio retained control by providing supervisors to monitor the performance of the respondents cannot be given much weight. Instead of exercising their own discretion or referring the matter to the officers of Grigio, its supervisors were obligated to refer to petitioners supervisors any discrepancy in the performance of the respondents. Lastly, the law casts the burden on the contractor to prove that it has substantial capital, investment, tools etc. In this case, neither Grigio nor the petitioner was able to present any proof that Grigio had substantial capital.
selection of the personnel it provided to Burlingame. Actual hiring itself was done through the deployment of personnel to establishments by Burlingame. The contract also stipulated that Burlingame shall pay F. Garil a certain sum per worker. F. Garil merely served as conduit in the payment of wages to the personnel. The interpretation would have been different if the payment was for the job, project, or services rendered during the month and not on a per worker basis. The Court has taken judicial notice of the practice of employers who do not issue payslips directly to employees. Under current practice, a third person, usually the purported contractor (service or manpower placement agency), assumes the act of paying the wage. The contract also provides that any personnel found to be inefficient, troublesome, uncooperative and not observing the rules and regulations set forth by Burlingame shall be reported to F. Garil and may be replaced upon request. Corollary to this circumstance would be the exercise of control and supervision by Burlingame over workers supplied by F. Garil in order to establish the nature of undesirable personnel.
LABOR STANDARDS
D. LIABILITY
Art. 107: Indirect employer, SEE page 5 Art. 108: An employer or indirect employer may require the contractor or subcontractor to furnish a bond equal to the cost of labor under contract, on condition that the bond will answer for the wages due the employees should the contractor or subcontractor, as the case may be, fail to pay the same. Art. 109: The provisions of existing laws to the contrary notwithstanding, every employer or indirect employer shall be held responsible with his contractor or subcontractor for any violation of any provision of this Code. For purposes of determining the extent of their civil liability under this Chapter, they shall be considered as direct employers.
Lakas vs. Burlingame (2007): No proof was adduced to show F. Garils capitalization. The work of the promo-girls was marketing and selling, and thus directly related to the principal business or operation of Burlingame. Finally, F. Garil did not undertake the performance of its service contract according to its own manner and method, free from the control and supervision of Burlingame. Based on the contract, F. Garil was responsible in the hiring process only with respect to the screening, testing and pre-
Philippine Airlines, Inc. vs. NLRC (1998): In legitimate job contracting, no employer-employee relation exists between the principal and the job contractor's employees. The principal is responsible to the job contractor's
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employees only for the proper payment of wages. But in labor-only contracting, an employer-employee relation is created by law between the principal and the labor-only contractor's employees, such that the former is responsible to such employees, as if he or she had directly employed them. Landazares vs. Amethyst Security (2003): The only time the indirect employer may be made solidarily liable with the contractor is when the contractor fails to pay his employees their wages and other benefits claimed. Eparwa Security, Inc. vs Liceo de Cagayan University (2006): Citing Eagle Security Agency vs. NLRC--In the case at bar, it is beyond dispute that the security guards are the employees of EAGLE (contractor.) That they were assigned to guard the premises of PTSI (principal) pursuant to the latters contract with EAGLE and that neither of these two entities paid their wage and allowance increases under the subject wage orders are also admitted. Thus, the application of the aforecited provisions of the Labor Code on joint and several liability of the principal and contractor is appropriate. The solidary liability of PTSI and EAGLE, however, does not preclude the right of reimbursement from his co-debtor by the one who paid [See Article 1217, Civil Code]. It is with respect to this right of reimbursement that petitioners can find support in the aforecited contractual stipulation xxx
LABOR STANDARDS
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Chapter 3. Employee Classification

I. STATUTORY BASIS/OVERVIEW CLASSIFICATION A. Coverage B. Regular Employment C. Casual Employment D. Probationary Employment E. Project Employment F. Seasonal Employment G. Recognition and Determination II. REGULAR EMPLOYEES III. PROJECT EMPLOYEES IV. CASUAL EMPLOYEES V. CONTRACTS FOR FIXED PERIODS VI. SEASONAL VII. PROBATIONARY EMPLOYEES OF
C. CASUAL EMPLOYMENT (ART. 280) 1. When not regular, project or seasonal 2. Requirements to become Regular employees: one (1) year service, continuous or broken a. with respect to activity employed b. employment shall continue while such activity exists D. PROBATIONARY (ART. 281) EMPLOYMENT
LABOR STANDARDS
I. STATUTORY BASIS/ OVERVIEW OF CLASSIFICATION

SEE: ART. 278, 280, 281, LABOR CODE Omnibus Rules Book VI, Rule 1, Sec. 5 and cases below for full details A. COVERAGE (ART. 279) applies to all establishments or undertakings, whether for profit or not. B. REGULAR EMPLOYMENT (ART. 280) 1. Employee engaged to perform activities which are usually necessary or desirable to the usual trade or business of the employer. 2. Written agreement to the contrary notwithstanding, regardless of oral agreement of parties provided by law. 3. Other Regular Employees a. Casual Employees (Art. 280): after one year of service, whether continuous or broken, with respect to activity in which he is employed b. Probationary Employees (Art. 281): allowed to work even after the completion of the probationary period c. Learner (Art. 75 D): allowed or suffered to work during the first two months of learner period, if training is terminated by the employer before the end of the stipulated period. 4. Not Included (Art 280, par. 1): a. Project Employees b. Seasonal Employees 5. Regular employment not synonymous with permanent employment, since there is no such thing as permanent employment. Any employee may be terminated for cause.
1. Not to exceed six (6) months from the date the employee started working, unless covered by an apprenticeship agreement stipulating a longer period. 2. Termination only for: a. just causes, or b. failure to qualify as a regular employee in accordance with reasonable standards made known by the employer to the employee at the time of engagement. 3. Purposes a. Observance Period for employer to determine if employee is qualified and for employee to demonstrate to the ER his skills. b. RestrictiveAs long as the termination was made before the expiration of the six-month probationary period, the employer has a right to sever the employeremployee relationship 4. Parties may agree to a longer period of probation if (a) company policy or (b) the nature of the work require. 5. Direct Rationale Connection: if unduly long, may be unfair to the worker 6. Nothing prohibits the ER from abbreviating or shortening the period. 7. If extension is agreed upon for the benefit of the worker this is ex gratia. 8. ER has no obligation to pay for the Unfinished portion. E. PROJECT EMPLOYMENT (ART. 280) 1. Employment fixed on a specific project or undertaking, completion or termination of which is determined at the time of engagement of the employee.
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2. Must have been forewarned of the nature/scope and duration of the project. 3. Whether or not the project has a direct relation to the business of the ER is not important, BUT a. EE must be informed of the nature and duration of project b. project and principal business of ER are two separate things c. no attempt to deny security of tenure to the worker F. SEASONAL EMPLOYMENT 1. Work or services to be performed are seasonal in nature, employment is for the duration of the season. 2. No continuing need for the worker.
and repeated rehiring, some for nearly two decades, of these bill collectors indicate the necessity and desirability of their services, as well as the importance of the role of bill collectors in the MWSS. C. HIRING FOR AN EXTENDED PERIOD Audion Electric Co., Inc. vs. NLRC (1999): Where the employment of project employees is extended long after the supposed project has been finished, the employees are removed from the scope of project employees and considered regular employees. D. REPEATEd RENEWAL OF CONTRACT Beta Electric Corp. vs. NLRC (1990): The petitioner cannot rightfully say that since the private respondent's employment hinged from contract to contract, it was "temporary", depending on the term of each agreement. Under the Labor Code, an employment may only be said to be "temporary" "where: 1. [it] has been fixed for a specific undertaking, the completion of or termination of which has been determined at the time of the engagement of the employee or 2. where the work or services to be performed is seasonal in nature and the employment is for the duration of the season. Quite to the contrary, the private respondent's work, that of "typist-clerk" is far from being "specific" or "seasonal", but rather, one "where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business." And under the Code, where one performs such activities, he is a regular employee, "[t]he provisions of written agreement to the contrary notwithstanding It is true that in Biboso vs Victorias Milling Company, Inc. we recognized the validity of contractual stipulations as to the duration of employment. But we cannot apply it here because clearly, the contract-tocontract arrangement given to the private respondent was but an artifice to prevent her from acquiring security of tenure and to frustrate constitutional decrees.
LABOR STANDARDS
II. REGULAR EMPLOYEES

A. DEFINITION Pangilinan vs. Gen. Milling Corp. (2004): A regular employee is one who is engaged to perform activities which are necessary and desirable in the usual business or trade of the employer as against those which are undertaken for a specific project or are seasonal. There are two separate instances whereby it can be determined that an employment is regular: 1. if the particular activity performed by the employee is necessary or desirable in the usual business or trade of the employer; and, 2. if the employee has been performing the job for at least a year. B. STANDARD OF DETERMINATION Lopez vs. MWSS (2005): The primary standard in determining regular employment is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. The connection can be determined by considering the nature of the work performed and its relation to the scheme of the particular business or trade in its entirety. The repeated and continuing need for the performance of the job has been deemed sufficient evidence of the necessity, if not indispensability of the activity to the business. In the case at bar, continuous
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E. LENGTH OF TIME INVOLVED Maraguinot vs. NLRC (1998): Length of time not controlling, merely serves as a badge of regular employment.
III. PROJECT EMPLOYEES

A. TEST OF PROJECT EMPLOYMENT PNOC Energy Devt Corp vs. NLRC (2007): The principal test for determining whether employees are properly characterized as "project employees," as distinguished from "regular employees," is whether or not the project employees were assigned to carry out a "specific project or undertaking," the duration and scope of which were specified at the time the employees were engaged for that project. As defined, project employees are those workers hired: (1) for a specific project or undertaking, and (2) the completion or termination of such project or undertaking has been determined at the time of the engagement of the employee. B. RATIONALE De Ocampo vs. NLRC (1990): If a project has already been completed, it would be unjust to require the employer to maintain them in the payroll while they are doing absolutely nothing except waiting until another project is begun, if at all. In effect, these stand-by workers would be enjoying the status of privileged retainers, collecting payment for work not done, to be disbursed by the employer from profits not earned. C. EXAMPLES OF PROJECT EMPLOYMENT Phil. Jai-Alai and Amusement Corp. vs. Clave (1983): Private respondents, as well as the other 30 workers, were needed as additional hands for the renovation work and not for ordinary upkeep and maintenance. The erection of the fire escape and other small jobs after the renovation cannot be deemed maintenance but more of casual work. Sandoval Shipyards, Inc. vs. NLRC (1985): The corporation does not construct vessels for sale or otherwise which will demand continuous production of ships and will need regular workers. It merely accepts contracts for ship-building or for repair
of vessels from third parties. It is only on occasion when it has work contract of this nature that it hires workers to do the job which, needless to say, lasts only for less than a year or longer. Completion of their work or project automatically terminates their employment. Imbuido vs. NLRC (2000): Petitioner was engaged to perform data encoding and keypunching, and her employment was fixed for a specific project or undertaking the completion or termination of which had been determined at the time of her engagement. [This] may be observed from the series of employment contracts between petitioner and private respondent, all of which contained a designation of the specific job contract and a specific period of employment.
LABOR STANDARDS
D. EMPLOYER OBLIGATION TO MAKE STANDARDS KNOWN A. M. Oreta and Co., Inc. vs. NLRC (1989): The law is clear that in all cases involving employees engaged on probationary' basis, the employer shall make known to the employee at the time he is hired, the standards by which he will qualify as a regular employee. Nowhere in the employment contract executed between petitioner and respondent Grulla is there a stipulation that the latter shall undergo a probationary period for three months before he can quality as a regular employee. There is also no evidence on record showing that the respondent Grulla had been apprised of his probationary status and the requirements which he should comply in order to be a regular employee. In the absence of these requisites, there is justification in concluding that respondent Grulla was a regular employee at the time he was dismissed by petitioner, and as such cannot be done without just and authorized cause. E. SPECIFIED PERIOD Purefoods Corp. vs. NLRC (1987): The Court has upheld the legality of fixedterm employment. It ruled that 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 the parties for the
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commencement and termination of their employment relationship. But, this Court went on to say that where from the circumstances it is apparent that the periods have been imposed to preclude acquisition of tenurial security by the employee, they should be struck down or disregarded as contrary to public policy and morals. F. CONTINUOUS RE-HIRING Chua vs. Court of Appeals (2004): Despite the insistence of petitioner that they were project employees, the facts show that as masons, carpenters and fine graders in petitioners various construction projects, they performed work which was usually necessary and desirable to petitioners business which involves construction of roads and bridges. It is not enough that an employee is hired for a specific project or phase of work. There must also be a determination of, or a clear agreement on, the completion or termination of the project at the time the employee was engaged. This second requirement was not met in this case. C.E. Construction Corp vs. Cioco (2004): The fact that the workers have been employed with the company for several years on various projects, the longest being nine (9) years, did not automatically make them regular employees considering that the definition of regular employment in Article 280 of the Labor Code, makes specific exception with respect to project employment. 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.
which required the employer company to report to the nearest Public Employment Office the fact of termination of a project employee as a result of the completion of the project or any phase in which he is employed. Furthermore, Department Order No. 19, which was issued on April 1, 1993, did not totally dispense with the notice requirement. Instead, it made provisions and considered it (i.e. the notice) as one of the "indicators" that a worker is a project employee.
LABOR STANDARDS
H. WORKPOOL EMPLOYEE Maraguinot vs. NLRC (1998): A project EE or a member of a work pool may acquire the status of a regular employee when the following concur: 1. There is a continuous rehiring of project employees even after cessation of a project; and 2. the tasks performed by the alleged project employee are vital, necessary, and indispensable to the usual business or trade of the employer. However, the length of time during which the EE was continuously rehired is not controlling, but merely serves as a badge of regular employment. A work pool may exist although the workers in the pool do not receive salaries and are free to seek other employment during temporary breaks in the business, provided, that the worker shall be available when called to report for a project. Although primarily applicable to regular seasonal workers, this set-up can likewise be applied to project workers insofar as the effect of temporary cessation of work is concerned. Aguilar Corp. vs. NLRC (1997): Members of a work pool from which a construction company draws its project employees, if considered employees of the construction company while in the work pool, are non-project employees, or employees for an indefinite period. If they are employed in a particular project, the completion of the project or any phase thereof will not mean severance of the employer-employee relationship.
G. POLICY NO. 2 OF 1997 AND D.O. 19 OF 1993 Samson vs. NLRC (1996): When the present action for regularization was filed on November 5, 1989 and during the entire period of petitioner's employment with private respondent prior to said date, the rule in force then was Policy Instruction No. 20,
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IV. CASUAL EMPLOYEES

A. NATURE OF WORK A. M. Oreta and Co., Inc. vs. NLRC (1989): What determines regularity or casualness is not the employment contract, written or otherwise, but the nature of the job. If the job is usually necessary or desirable to the main business of the employer, then employment is regular. B. ONE YEAR SERVICE Tabas vs. California Marketing Co., Inc. (1989): The fact that the petitioners have been hired on a "temporary or seasonal" basis merely is no argument either. As held in Philippine Bank of Communications v. NLRC, a temporary or casual employee, under Article 281 of the Labor Code, becomes regular after service of one year, unless he has been contracted for a specific project. And we cannot say that merchandising is a specific project for the obvious reason that it is an activity related to the day-to-day operations of California. The records show that the petitioners had been given an initial six month contract, renewed for another six months. Accordingly, under Article 281 of the Code, they had become regular employees of California and had acquired a secure tenure. Hence, they cannot be separated without due process of law.
the parties are forbidden from agreeing on a period of time for the performance of such activities. There is thus nothing essentially contradictory between a definite period of employment and the nature of the employee's duties. It goes without saying that contracts or employment govern the relationship of the parties. In this case, private respondent's contract provided for a fixed term of nine (9) months, from June 1, 1991 to March 31, 1992. Such stipulation, not being contrary to law, morals, good customs, public order and public policy, is valid, binding and must be respected.
LABOR STANDARDS
Servidad vs. NLRC (1999):However, the Court upholds the principle that where 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.
VI. SEASONAL EMPLOYEES

Hacienda Bino vs. Cuenca (2005): For respondents to be excluded from those classified as regular employees, it is not enough that they perform work or services that are seasonal in nature. They must have been employed only for the duration of one season. While the records sufficiently show that the respondents work in the hacienda was seasonal in nature, there was, however, no proof that they were hired for the duration of one season only. In fact, the payrolls, submitted in evidence by the petitioners, show that they availed the services of the respondents since 1991. Absent any proof to the contrary, the general rule of regular employment should, therefore, stand. The disparity in facts between the Mercado Sr., vs. NLRC case case and the instant case is best exemplified by the fact that the farm laborers, work only for a definite period for a farm worker, after which they offer their services to other farm owners. In Mercado, although respondent constantly availed herself of the
V. CONTRACT FOR A FIXED PERIOD

St. Theresas School vs. NLRC (1998): Article 280 of the Labor Code does not proscribe or prohibit an employment contract with a fixed period provided the same is entered into by the parties, without any force, duress or improper pressure being brought to bear upon the employee and absent any other circumstance vitiating consent. It does not necessarily follow that where the duties of the employee consist of activities usually necessary or desirable in the usual business of the employer,
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petitioners services from year to year, it was clear from the facts therein that they were not in her regular employ. In other words, they worked for respondent, but were nevertheless free to contract their services with other farm owners.
"probationary (6 mos.)." The fivemonth period referred to the evaluation of his work. Busier vs. Leogardo (1984): Generally, the probationary period of employment is limited to six (6) months. The exception to this general rule is when the parties to an employment contract may agree otherwise, such as when the same is established by company policy or when the same is required by the nature of work to be performed by the employee. In the latter case, there is recognition of the exercise of managerial prerogatives in requiring a longer period of probationary employment, such as in the present case where the probationary period was set for eighteen (18) months, i.e. from May, 1980 to October, 1981 inclusive, especially where the employee must learn a particular kind of work such as selling, or when the job requires certain qualifications, skills, experience or training. Holiday Inn Manila vs. NLRC (1993): Honasan was certainly under observation during her three-week on-the-job training. If her services proved unsatisfactory then, she could have been dropped as early as during that period. But she was not. On the contrary, her services were continued, presumably because they were acceptable, although she was formally placed this time on probation. Even if it be supposed that the probation did not end with the three-week period of on-the-job training, there is still no reason why that period should not be included in the stipulated six-month period of probation. Honasan was accepted for on-the-job training on April 15, 1991. Assuming that her probation could be extended beyond that date, it nevertheless could continue only up to October 15, 1991, after the end of six months from the earlier date. Under this more lenient approach, she had become a regular employee of Holiday Inn and acquired full security of tenure as of October 15, 1991. Mitsubishi Motors vs. Chrysler Union (2004): Paras started reporting for work on May 27, 1996. The employers unanimously agreed that his
LABOR STANDARDS
VII.
PROBATIONARY EMPLOYEES
A. DEFINITION International Catholic Migration Comm. vs. NLRC (1989): A probationary employee is one who is on trial by an employer during which the employer determines whether or not he is qualified for permanent employment. B. PURPOSE/EMPLOYER RIGHT Grand Motors Corp. vs. MOLE (1984): Managing petitioner's Iloilo Branch was an entirely new experience for private respondent. It was, therefore, necessary for private respondent to undergo a period of probation to test his qualifications, skill and experience. Indeed, the employer has the right or is at liberty to choose as to who will be hired and who will be declined. It is within the exercise of this right to select his employees that the employer may set or fix a probationary period within which the latter may test and observe the conduct of the former before hiring him permanently. The right of a laborer to sell his labor to such persons as he may choose is, in its essence, the same as the right of an employer to purchase labor from any person whom it chooses. The employer and the employee have thus an equality of right guaranteed by the Constitution. C. DURATION AND EXCEPTION Alcira vs. NLRC (2004): Petitioner claims that under the terms of his contract, his probationary employment was only for five months as indicated by the remark "Please be informed that after five months, your performance shall be evaluated and any adjustment in salary shall depend on your work performance." The argument lacks merit. As correctly held by the labor arbiter, the appointment contract also stated in another part that petitioners employment status was
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performance was unsatisfactory. On November 26, 1996, he received a Notice of Termination dated November 25, 1996, Applying Article 13 of the Civil Code, the probationary period of six (6) months consists of one hundred eighty (180) days. As clearly provided for in the last paragraph of Article 13, in computing a period, the first day shall be excluded and the last day included. Thus, the one hundred eighty (180) days commenced on May 27, 1996, and ended on November 23, 1996. By the time Paras received the letter he was already a regular employee of the petitioner under Article 281 of the Labor Code. D. CRITERIA FOR REGULARIZATION Alcira vs. NLRC (2004): In all cases of probationary employment, 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. Where no standards are made known to the employee at that time, he shall be deemed a regular employee. Conversely, an employer is deemed to substantially comply with the rule on notification of standards if he apprises the employee that he will be subjected to a performance evaluation on a particular date after his hiring. E. EFFECT OF EXTENDING CONTRACT Bernardo vs. NLRC (1999): When the bank renewed the contract after the lapse of the six-month probationary period, the employees thereby became regular employees. No employer is allowed to determine indefinitely the fitness of its employees. F. ABSORBED EMPLOYEES Cebu Stevedoring Co., Inc. vs. Regional Director (1988): The private respondents could not be considered probationary employees because they were already well-trained in their respective functions. As stressed by the Solicitor General, while private respondents were still with the CCAS they were already
clerks. Respondent Gelig had been a clerk for CCAS for more than ten (10) years, while respondent Quijano had slightly less than ten (10) years of service. They were, therefore, not novices in their jobs but experienced workers. G. DOUBLE PROBATION A Prime Security Services, Inc. vs. NLRC (2000): There is no basis for subjecting an employee to a new probationary or temporary employment where he had already become a regular employee when he was absorbed by a sister company. H. TERMINATION AND SALARY De la Cruz, Jr. vs. NLRC (2004): A probationary employee enjoys only a temporary employment status. This means that he is terminable at any time, permanent employment not having been attained in the meantime. The employer could well decide he no longer needed the probationary employees services or his performance fell short of expectations, etc. As long as the termination was made before the termination of the six-month probationary period, the employer was well within his rights to sever the employer-employee relationship. A contrary interpretation would defect the clear meaning of the term probationary. I. PRIVATE SCHOOL TEACHERS Aklan College vs. Guarino (2007): The provisions of Article 280 of the Labor Code are not applicable to the present case especially with respect to the issue of respondent's acquisition of security of tenure. It is settled that questions respecting a private school teachers entitlement to security of tenure are governed by the Manual of Regulations for Private Schools and not the Labor Code. (Paragraph 75 of the 1970 Manual)
LABOR STANDARDS
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Chapter 4. Employment, Recruitment, and Placement of Workers

I. STATUTORY BASIS A. Substantive B. Procedural II. RECRUITMENT AND PLACEMENT DEFINED A. Local Employment B. Overseas Employment III. PARTIES INVOLVED A. Workers B. Allowed Entities For Recruitment C. Prohibited Entities IV. GOVERNMENT TECHNIQUES OF REGULATION A. Licensing B. Workers Fees C. Reports/Submission D. Suspension E. Enforcement Powers F. Sanctions V. PROHIBITED PRACTICES VI. ILLEGAL RECRUITMENT A. Local Employment B. Overseas Employment C. Cases VII. JURISDICTION A. Regional Trial Court B. Labor Arbiter C. POEA over administrative cases VIII. ALIEN EMPLOYMENT A. Coverage B. Techniques of Regulation C. DOLE Guidelines For Issuance of Alien Employment Permit IX. DEVELOPMENT OF HUMAN RESOURCES A. Human Resources Development B. Training and Development of Special Workers
II.
RECRUITMENT AND PLACEMENT DEFINED

LABOR STANDARDS
A. LOCAL EMPLOYMENT
Art. 13 (b): Recruitment and placement" refers to any act of 1. canvassing, 2. enlisting, 3. contracting, 4. transporting, 5. utilizing, or 6. hiring procuring workers, And also includes 1. referrals, 2. contract services, 3. promising, or 4. advertising for employment, locally or abroad, whether for profit or not Provided, That any person or entity which, in any manner, offers or promises for a fee employment to two or more persons shall be deemed engaged in recruitment and placement.
I.
STATUTORY BASIS
A. SUBSTANTIVE: Labor Code Book One (Pre Employment), Republic Act 7796 (TESDA Act of 1994) superseding certain parts of Book Two of Labor Code (Human Resources Development Program), RA 8042 (Migrant Workers Act of 1995), Magna Carta for Disabled Persons (R.A. No. 7796) B. PROCEDURAL OMNIBUS RULES IMPLEMENTING THE LABOR CODE: Book One, Book Two (NOTE: RA 7796 and later laws prevail in case of conflict,) 2002 POEA Rules Governing Recruitment and Employment of LandBased Overseas Workers
People v. Panis (1988): The number of persons dealt with is not an essential ingredient of the act of recruitment and placement of workers. Any of the acts mentioned in Article 13(b) will constitute recruitment and placement even if only one prospective worker is involved. The proviso merely lays down a rule of evidence that where a fee is collected in consideration of a promise or offer of employment to two or more prospective workers, the individual or entity dealing with them shall be presumed to be engaged in the act of recruitment and placement. People vs. Saulo (2000): The Court finds that the trial court that accusedappellant was engaged in unlawful recruitment and placement activities. The prosecution established that accused-appellant promised three complainants employment as factory workers and he asked them for money in order to process their papers and procure their passports. Relying completely upon such representations, complainants entrusted hard-earned money to accused-appellant in exchange for what they would later discover to be a vain hope of obtaining employment abroad. It is not disputed that accused-appellant is not authorized nor licensed by the DOLE to engage in recruitment and placement activities. The absence of the necessary license or authority renders all of
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accused-appellants activities criminal. B. OVERSEAS EMPLOYMENT
recruitment
3. Private Entities
Art. 13 (c): "Private employment agency" is any person or entity engaged in the recruitment and placement of workers for a fee which is charged, directly or indirectly, from the workers or employers or both Art. 13 (d): License is a document issued by the Department of Labor authorizing a person or entity to operate a private employment agency. Art. 13 (e): Private recruitment entity" is any person or association engaged in the recruitment and placement of workers, locally or overseas, without charging, directly or indirectly, any fee from the workers or employers. Art. 13 (f): Authority is a document issued by the Department of Labor authorizing a person or association to engage in recruitment and placement activities as a private recruitment entity.
LABOR STANDARDS
SEE: Republic Act 8042, Sec. 6 below, in relation to Labor Code, Art. 13(b) on previous page
III.
PARTIES INVOLVED
A. WORKERS 1. Labor Code, Art. 13 (a): are any member of the labor force, whether employed or unemployed 2. RA 8042, Sec. 3(a): "Migrant worker" refers to a person who is to be engaged, is engaged or has been engaged in a renumerated activity in a state of which he or she is not a legal resident, to be used interchangeably with overseas Filipino worker. B. ALLOWED ENTITIES RECRUITMENT FOR
C. PROHIBITED ENTITIES 1. Art. 16: Persons and entities other than public employment offices if not authorized under Chapter 2, Title I, Book One of the Labor Code. 2. Art. 18: Employers hiring directly for work abroad without going through DOLE-authorized boards and entities, EXCEPT direct-hiring by members of the diplomatic corps, international organizations and as such other employers as may be allowed by the Secretary of Labor. 3. Art. 26: Travel agencies and sales agencies of airline companies are prohibited from engaging in the business of recruitment and placement of workers for overseas employment whether for profit or not. Hornales vs. NLRC (2001): NLRC erred in saying respondent JEAC was a mere travel agency and petitioner, a mere tourist. Even private respondents consistently plead that JEAC is a licensed recruitment agency authorized to recruit and deploy overseas Filipino contract workers. Furthermore, it would be too much of a coincidence to say that petitioner and his co-workers are all mere tourists who allowed a certain Victor Lim to deduct from their salaries the amount of their obligations to respondent Cayanan. What is evident here is an internal arrangement between respondent Cayanan and Victor Lim brought about by the fact that the former deployed these workers to serve the latter.
1. General Rules: a. Labor Code, Art. 16: No person or entity other than the public employment offices shall engage in recruitment or placement of workers, EXCEPT those persons or entities provided in Chapter II, Title I, Book One of the Labor Code b. Art. 18: No employer may hire a Filipino worker for overseas employment except through the Boards and entities authorized by the Secretary of Labor... c. Art. 25: The private employment sector shall participate in the recruitment and placement of workers, locally and overseas, under such guidelines, rules and regulations as may be issued by the Secretary of Labor (Art. 25) d. Art. 12: The State shall strengthen the network of public employment offices and rationalize the participation of the private sector in the recruitment and placement of workers 2. Public Entities SEE Art 12 (f), Art. 14 (a): Public employment offices: their network shall be strengthened and new employment offices shall be organized and established by the Secretary of Labor as the need arises
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IV.
GOVERNMENT TECHNIQUES OF REGULATION
(NOTE: See also 2002 POEA Rules Governing the Recruitment and Employment of Land-based Overseas Workers) A. LICENSING 1. Citizenship
Labor Code, Art. 27: 1.) Only Filipino citizens or 2.) Corporations, partnerships or entities at least seventy-five percent (75%) of the authorized and voting capital stock of which is owned and controlled by Filipino citizens shall be permitted to participate in the recruitment and placement of workers, locally or overseas. SEE: POEA Rules, Part II, Rule I, Sec. 1(a)
conducting any recruitment activities of any form outside of the address stated in the license, acknowledged branch or extension office, without securing prior authority from the POEA. RSI could recruit only in Mandaluyong but had no branch or extension office in Baguio. 5. Registration Fees
Labor Code, Art. 30: The Secretary of Labor shall promulgate a schedule of fees for the registration of all applicants for license or authority. SEE: POEA Rules, Part II, Rule II, Sec. 4
LABOR STANDARDS
6. Bonds
Labor Code, Art. 31: All applicants for license or authority shall post such cash and surety bonds as determined by the Secretary of Labor to guarantee compliance with prescribed recruitment procedures, rules and regulations, and terms and conditions of employment as may be appropriate. SEE: POEA Rules, Part II, Rule II, Sec. 4
2. Capitalization
Labor Code, Art. 28: All applicants for authority to hire or renewal of license to recruit are required to have such substantial capitalization as determined by the Secretary of Labor. SEE ALSO: POEA Rules, Part II, Rule I, Sec. 1(b)
B. WORKERS FEES
Labor Code, Art. 32: Any person applying with a private fee-charging employment agency for employment assistance shall not be charged any fee until he has obtained employment through its efforts or has actually commenced employment. Such fee shall be always covered with the appropriate receipt clearly showing the amount paid. The Secretary of Labor shall promulgate a schedule of allowable fees. SEE: POEA Rules, Part II, Rule V., Sec. 3
3. Duration
SEE: POEA Rules Part II, Rule II, Sec. 5 and 6
4. Non-transferability authority
Labor Code, Art. 29:
of
license
or
1.) No license or authority shall be used directly or indirectly by any person other than the one in whose favor it was issued or at any place other than that stated in the license or authority, 2.) nor may such license or authority be transferred, conveyed, or assigned to any other person or entity. Any transfer of business address, appointment or designation of any agent or representative including the establishment of additional offices anywhere shall be subject to the prior approval of the Department of Labor. SEE: POEA Rules Part II, Rule II, Sec. 7, 8, and 9.
C. REPORTS/SUBMISSION
Labor Code, Art. 33: Whenever the public interest so requires, the Secretary of Labor and Employment may direct all persons or entities within the coverage of this Title to submit a report on the status of employment, including job vacancies; details of job requisitions, separation from jobs, wages, other terms and conditions, and other employment data. Art. 14(d): The Secretary of Labor shall have the power and authority: To require any person, establishment, organization or institution to submit such employment information as may be prescribed by the Secretary of Labor.
People vs. Buli-e (2003): Even if respondent was licensed to recruit workers for overseas employment, her authority to do so ceased when the license of her agency, RSI, was suspended on June 8 1992 and when it eventually expired on July 14, 1992, as confirmed by the POEA. Moreover, licensed agencies are prohibited from
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D. SUSPENSION
Labor Code, Art. 35: The Secretary of Labor shall have the power to suspend or cancel any license or authority to recruit employees for overseas employment for violation of rules and regulations issued by the Department of Labor, the Overseas Employment Development Board, and the National Seamen Board, or for violation of the provisions of this and other applicable laws, General Orders and Letters of Instructions.
E. ENFORCEMENT POWERS 1. Regulatory Power

SEE: Labor Code, Art. 35 above Art. 36: The Secretary of Labor shall have the power to restrict and regulate the recruitment and placement activities of all agencies within the coverage of this Title and is hereby authorized to issue orders and promulgate rules and regulations to carry out the objectives and implement the provisions of this Title.
violating any provision thereof or its implementing rules and regulations shall, upon conviction thereof, suffer the penalty of imprisonment of not less than four years nor more than eight years or a fine of not less than P20,000 nor more than P100,000 or both such imprisonment and fine, at the discretion of the court; (d) If the offender is a corporation, partnership, association or entity, the penalty shall be imposed upon the officer or officers of the corporation, partnership, association or entity responsible for violation; and if such officer is an alien, he shall, in addition to the penalties herein prescribed, be deported without further proceedings; (e) In every case, conviction shall cause and carry the automatic revocation of the license or authority and all the permits and privileges granted to such person or entity under this Title, and the forfeiture of the cash and surety bonds in favor of the Overseas Employment Development Board or the National Seamen Board, as the case may be, both of which are authorized to use the same exclusively to promote their objectives.
LABOR STANDARDS
2. Rule-making power SEE: Art. 36 above 3. Visitorial Power

SEE: Art. 35 above Art. 37: The Secretary of Labor or his duly authorized representatives may, at any time, inspect the premises, books of accounts and records of any person or entity covered by this Title, require it to submit reports regularly on prescribed forms, and act on violations of any provisions of this Title.
2. Overseas Employment
SEE: RA 8042, Sec. 6 Sec. 7: (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 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 nonholder of authority. Sec. 10: Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the priginal 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 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 section shall be joint and several. This provisions 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 Page 29 of 161
F. SANCTIONS NOTE: See Parts V and VI for Prohibited Practices and Illegal Recruitment for certain cases covered by these Sanctions. 1. Local Employment
SEE: Labor Code, Art. 35 above Art. 39: (a) The penalty of life imprisonment and a fine of One Hundred Thousand Pesos (P100,000) shall be imposed if illegal recruitment constitutes economic sabotage as defined herein: (b) Any licensee or holder of authority found violating or causing another to violate any provision of this Title or its implementing rules and regulations shall, upon conviction thereof, suffer the penalty of imprisonment of not less than two years nor more than five years or a fine of not less than P10,000 nor more than P50,000, or both such imprisonment and fine, at the discretion of the court; (c) Any person who is neither a licensee nor a holder of authority under this Title found
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. 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. In case of termination of overseas employment without just, valid or authorized cause as defined by law or contract, the workers shall be entitled to the full reimbursement of his placement fee with interest of twelve percent (12%) per annum, plus his salaries for the unexpired portion of his employment contract or for three (3) months for every year of the unexpired term, whichever is less. Non-compliance with the mandatory periods for resolutions of cases provided under this section 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 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. 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. SEE: POEA Rules, Part II, Rule II, Sec. 1(f)(3)
their salaries for the entire unexpired portions of their contracts. But with the enactment of R.A. No. 8042, specifically the adoption of the subject clause, illegally dismissed OFWs with an unexpired portion of one year or more in their employment contract have since been differently treated in that their money claims are subject to a 3month cap, whereas no such limitation is imposed on local workers with fixedterm employment. The Court concludes that the subject clause contains a suspect classification. The subject clause singles out one classification of OFWs and burdens it with a peculiar disadvantage.
LABOR STANDARDS
V. PROHIBITED PRACTICES
Labor Code, Art. 34: Prohibited practices. It shall be unlawful for any individual, entity, licensee, or holder of authority: a. To charge or accept, directly or indirectly, any amount greater than that specified in the schedule of allowable fees prescribed by the Secretary of Labor, or to make a worker pay any amount greater than that actually received by him as a loan or advance; b. To furnish or publish any false notice or information or document in relation to recruitment or employment; c. To give any false notice, testimony, information or document or commit any act of misrepresentation for the purpose of securing a license or authority under this Code. d. To induce or attempt to induce a worker already employed to quit his employment in order to offer him to another unless the transfer is designed to liberate the worker from oppressive terms and conditions of employment; e. To influence or to attempt to influence any person or entity not to employ any worker who has not applied for employment through his agency; f. To engage in the recruitment or placement of workers in jobs harmful to public health or morality or to the dignity of the Republic of the Philippines; g. To obstruct or attempt to obstruct inspection by the Secretary of Labor or by his duly authorized representatives; h. To fail to file reports on the status of employment, placement vacancies, remittance of foreign exchange earnings, separation from jobs, departures and such other matters or information as may be required by the Secretary of Labor. i. To substitute or alter employment contracts approved and verified by the Department of Labor from the time of actual signing thereof by the parties up to and
Serrano vs. Gallant (2009): The subject clause "or for three months for every year of the unexpired term, whichever is less" in the 5th paragraph of Section 10 of Republic Act No. 8042 is declared unconstitutional. Prior to R.A. 8042, OFWs and local workers with fixed-term employment who were illegally discharged were treated alike in terms of the computation of their money claims: they were uniformly entitled to
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j.
k.
including the periods of expiration of the same without the approval of the Secretary of Labor; To become an officer or member of the Board of any corporation engaged in travel agency or to be engaged directly or indirectly in the management of a travel agency; and To withhold or deny travel documents from applicant workers before departure for monetary or financial considerations other than those authorized under this Code and its implementing rules and regulations.
3. Art. 38 (c) Declared Unconstitutional

Labor Code, Art. 38(c): The Secretary of Labor and Employment or his duly authorized representatives shall have the power to cause the arrest and detention of such non-licensee or non-holder of authority if after investigation it is determined that his activities constitute a danger to national security and public order or will lead to further exploitation of job-seekers. The Secretary shall order the search of the office or premises and seizure of documents, paraphernalia, properties and other implements used in illegal recruitment activities and the closure of companies, establishments and entities found to be engaged in the recruitment of workers for overseas employment, without having been licensed or authorized to do so.
LABOR STANDARDS
VI.
ILLEGAL RECRUITMENT
A. LOCAL EMPLOYMENT 1. Definition of Illegal Recruitment

Labor Code, Art. 38 (a) : Any recruitment activities, including the prohibited practices enumerated under Article 34 of this Code, to be undertaken by non-licensees or non-holders of authority shall be deemed illegal and punishable under Article 39 of this Code. The Secretary of Labor and Employment or any law enforcement officer may initiate complaints under this Article. SEE: Art. 13(b) for definition of recruitment activities and Art. 34 for definition of prohibited practices.
2. When Illegal Recruitment Committed By Syndicate Or In Large Scale

Labor Code, Art. 39(b): Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense involving economic sabotage and shall be penalized in accordance with Article 39 hereof. Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring and/or confederating with one another in carrying out any unlawful or illegal transaction, enterprise or scheme defined under the first paragraph hereof. Illegal recruitment is deemed committed in large scale if committed against three (3) or more persons individually or as a group.
Salazar vs. Achacoso (1990): Under Article III, Section 2, of the l987 Constitution, it is only judges, and no other, who may issue warrants of arrest and search. The exception is in cases of deportation of illegal and undesirable aliens, whom the President or the Commissioner of Immigration may order arrested, following a final order of deportation, for the purpose of deportation. Article 38, paragraph (c) of the Labor Code is declared UNCONSTITUTIONAL and null and void.
B. OVERSEAS EMPLOYMENT 1. Illegal Recruitment By A Non-licensee Or Non-holder Of Authority:

RA 8042, Sec. 6: 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 nonholder, who, in any manner, offers or promises for a fee employment abroad to two or more persons shall be deemed so engaged.
2. Illegal recruitment committed by any person:

RA 8042, Sec. 6: DEFINITIONS-It shall likewise include the following acts, whether committed by any persons, whether a nonlicensee, non-holder, licensee or holder of authority:
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(a) To charge or accept directly or indirectly any amount greater than the 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; (b) To furnish or publish any false notice or information or document in relation to recruitment or employment; (c) To give any false notice, testimony, information or document or commit any act of misrepresentation for the purpose of securing a license or authority under the Labor Code; (d) To induce or attempt to induce a worker already employed to quit his employment in order to offer him another unless the transfer is designed to liberate a worker from oppressive terms and conditions of employment; (e) To influence or attempt to influence any persons or entity not to employ any worker who has not applied for employment through his agency; (f) To engage in the recruitment of placement of workers in jobs harmful to public health or morality or to dignity of the Republic of the Philippines; (g) To obstruct or attempt to obstruct inspection by the Secretary of Labor and Employment or by his duly authorized representative; (h) To fail to submit reports on the status of employment, placement vacancies, remittances of foreign exchange earnings, separations from jobs, departures and such other matters or information as may be required by the Secretary of Labor and Employment; (i) To substitute or alter to the prejudice of the worker, employment contracts approved and verified by the Department of Labor and Employment from the time of actual signing thereof by the parties up to and including the period of the expiration of the same without the approval of the Department of Labor and Employment; (j) For an officer or agent of a recruitment or placement agency to become an officer or member of the Board of any corporation engaged in travel agency or to be engaged directly on indirectly in the management of a travel 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 reasons as determined by the Department of Labor and Employment; and (m) Failure to reimburse expenses incurred by the workers 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.
3. Illegal recruitment when done through syndicate or large scale:

RA 8042, Sec. 6(m): Illegal recruitment when committed by a syndicate or in large scale shall be considered as offense involving economic sabotage. (Par. 2:) Illegal recruitment is deemed committed by a syndicate 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.
LABOR STANDARDS
4. Criminal Liability of Persons

RA 8042, Sec. 6 (Par. 3): The persons criminally liableare the principals, accomplices and accessories. In case of juridical persons, the officers having control, management or direction of their business shall be liable.
C. CASES 1. Act of Referral Rodolfo vs. People (2006): The act of referral, which is included in recruitment, is "the act of passing along or forwarding of an applicant for employment after an initial interview of a selected applicant for employment to a selected employer, placement officer or bureau." Petitioners admission that she brought private complainants to the agency whose owner she knows and her acceptance of fees including those for processing betrays her guilt. 2. Presence of Elements of Crime C.F. Sharpe vs. Espanol (2007): In 1996, LCL had no approved POEA license to recruit. C.F. Sharps accreditation as LCLs new manning agency was still pending approval at that time. Yet it entertained applicants for LCLs vessels, and conducted preparatory interviews. Based on Art. 13 (b), this is a recruitment activity. The fact that C.F. Sharp did not receive any payment during the interviews is of no moment. The act of recruitment may be "for profit or not." Notably, it is the lack of the necessary license or authority, not the fact of payment that renders the recruitment activity of LCL unlawful. 3. Large-Scale Recruitment People vs. Reyes (1995): There are 14 other cases filed or pending against the accused for illegal recruitment. These cases cannot be taken into account for the purpose of Art. 38(b). When the Labor Code speaks of illegal recruitment
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"committed against three (3) or more persons individually or as a group," it must be understood as referring to the number of complainants in each case who are complainants therein, otherwise, prosecutions for single crimes of illegal recruitment can be cumulated to make out a case of large scale illegal recruitment. In other words, a conviction for large scale illegal recruitment must be based on a finding in each case of illegal recruitment of three or more persons whether individually or as a group. Moreover, even if Blanza and Garcia had been illegally recruited so as to raise the number of persons to four, since this was not alleged in the information, the appellant can only be found guilty of the less serious offense charged. 4. Employees/Other Officers Liabilities People vs. Sagayaga (2004): In People vs Cabais, an employee of a company or corporation engaged in illegal recruitment may be held liable as principal, together with his employer, if it is shown that he actively and consciously participated in illegal recruitment. Moreover, in this case the appellant was both the APSC VicePresident-Treasurer and the Assistant General Manager. She was a high corporate officer who had direct participation in the management, administration, direction and control of the business of the corporation, and is thus liable under Sec. 6 of RA 8042. The terms control, management or direction broadly cover all phases of business operation, including the aspects of administration, marketing and finances, among others.
B. LABOR ARBITER SEE: RA 8042 Sec. 10, above

LABOR STANDARDS
C. POEA OVER ADMINISTRATIVE CASES SEE: Omnibus Rules Implementing RA 8042, Sec. 28
VIII.
ALIEN EMPLOYMENT
A. COVERAGE
Labor Code, Art. 40: Any alien seeking admission to the Philippines for employment purposes and any domestic or foreign employer who desires to engage an alien for employment in the Philippines shall obtain an employment permit from the Department of Labor. The employment permit may be issued to a non-resident alien or to the applicant employer after a determination of the nonavailability of a person in the Philippines who is competent, able and willing at the time of application to perform the services for which the alien is desired. For an enterprise registered in preferred areas of investments, said employment permit may be issued upon recommendation of the government agency charged with the supervision of said registered enterprise.
VII.
JURISDICTION
General Milling vs. Torres (1991): The Labor Code specifically empowers the Secretary of Labor to make a determination of the availability of the services of a "person in the Philippines who is competent, able and willing at the time of application to perform the services for which an alien is desired." DOLE is the agency vested with jurisdiction to determine the question of availability of local workers. Almodiel vs. NLRC (1993): Article 40 of the Labor Code which requires employment permit refers to nonresident aliens. Since Ang Tan Chai is a resident alien, he does not fall within the ambit of the provision.
A. REGIONAL TRIAL COURT

RA 8042, Sec. 9: 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 same 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.
B. TECHNIQUES OF REGULATION
SEE: Art. 40 above Art. 41: (a) After the issuance of an employment permit, the alien shall not transfer to another job or change his employer without prior approval of the Secretary of Labor. (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
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to deportation after service of his sentence. Art. 42: Any employer employing non-resident foreign nationals on the effective date of this Code shall submit a list of such nationals to the Secretary of Labor within thirty (30) days after such date indicating their names, citizenship, foreign and local addresses, nature of employment and status of stay in the country. The Secretary of Labor shall then determine if they are entitled to an employment permit.
C. DOLE GUIDELINES FOR ISSUANCE OF ALIEN EMPLOYMENT PERMIT NOTE: SEE BOOK I RULE XIV OF OMNIBUS RULES IMPLEMENTING THE LABOR CODE, MODIFIED BY: DO (DOLE Department Order) 12-02, DO 19-02, DO-26-02, DO 41-03, DO 59-04 and DO 75-06 Pacific vs. Schonfeld (2007): Petitioner PPI applied for the issuance of an alien employment permit to respondent before the DOLE. In said application, PPI averred that respondent is its employee, and as proof, appended a copy of respondents employment contract. It bears stressing that under the IRR of the Labor Code, one of the requirements for the issuance of an employment permit is the employment contract. DOLE then granted the application of PPI and issued the permit.
secondary and lower tertiary levels, officially recognized as non-degree programs aimed at preparing technicians, para-professionals and other categories of middle-level workers by providing them with a broad range of general education, theoretical, scientific and technological studies, and related job skills training; "Trade" shall mean any group of interrelated jobs or any occupation which is traditionally or officially recognized as craft or artisan in nature requiring specific qualifications that can be acquired through work experience and/or training; "Middle-level Manpower" refers to those 1. Who have acquired practical skills and knowledge through formal or nonformal education and training equivalent to at least a secondary education but preferably at post-secondary education with a corresponding degree of diploma; or 2. Skilled workers who have become highly competent in their trade or craft as attested by industry;
LABOR STANDARDS
2. General Policy
RA 7796, Sec. 2: It is hereby declared the policy of the State to provide relevant, accessible, high quality and efficient technical education and skills development in support of the development of high quality Filipino middle-level personnel/human resources2 responsive to and in accordance with Philippine development goals and priorities. The state shall encourage active participation of various concerned sectors, particularly private enterprises, being direct participants in an immediate beneficiaries of a trained and skilled workforce, in providing technical education and skills development opportunities.
IX.
DEVELOPMENT RESOURCES
OF
HUMAN
A. HUMAN RESOURCES DEVELOPMENT1 1. Definitions

Labor Code, Art. 44(a): As used in this Title: (a) Manpower shall mean that portion of the nations population which has actual or potential capability to contribute directly to the production of goods and services. RA 7796, Sec. 4 (pars. a to e): "Skill" shall mean the acquired and practiced ability to carry out a task job; "Skills Development" shall mean the process through which learners and workers are systematically provided with learning opportunities to acquire or upgrade, or both, their ability, knowledge and behavior pattern required as qualifications for a job or range of jobs in a given occupation areas; "Technical Education" shall refer to the education process designed at postManpower Development in original text
3. Goals And Objectives

Sec. 3 : It is the goal and objective of this act to: Promote and strengthen the quality of technical education and skills development programs to attain international competitiveness Focus technical education and skills development or meeting the changing demands for quality middle-level manpower Encourage critical and creative thinking by disseminating the scientific and technical knowledge base of middle-level manpower development programs Recognize and encourage the complementary roles of public and private institutions in technical education and skills development and training systems; Inculcate desirable values through the development of moral character with emphasis on work ethic, self-discipline, self reliance, and nationalism.
2
manpower in original text
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B. TRAINING AND DEVELOPMENT OF SPECIAL WORKERS 1. Apprentices a. Definition

RA 7796, Sec. 4: "Apprenticeship" training within employment with compulsory related theoretical instruction involving a contract between an apprentice and an employer on an approved apprenticeable occupation; Apprentice" is a person undergoing training for an approved apprenticeable occupation during an apprenticeship agreement; "Apprenticeship Agreement" is a contract wherein a prospective employer binds himself to train the apprentice who in turn accepts the terms of training for a recognized apprenticeable occupation emphasizing the rights, duties and responsibilities of each party.
b. Apprenticeable Occupation
RA 7796 Sec. 4: Apprenticeable Occupation is an occupation officially endorsed by a tripartite body and approved to be apprenticeable by the authority.
and Provided, That the following requirements in all instances are strictly complied with: (a) The employer shall ensure the protection, health, safety, morals and normal development of the child; (b) The employer 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 child, a work permit from the Department of Labor and Employment which shall ensure observance of the above requirements. The Department of Labor and Employment shall promulgate rules and regulations necessary for the effective implementation of this Section. SEE ALSO: Labor Code, Art. 59 and Rule VI, Sec. 11 of Labor Code IRR (NOTE: RA 7160 and RA 7658 were enacted after the Labor Code and IRR.)
LABOR STANDARDS
Nitto Enterprises vs. NLRC, (1995): The act of filing the proposed apprenticeship program with the DOLE is a preliminary step towards its final approval and does not instantaneously give rise to an employer-apprentice relationship. It must be duly approved by the Minister of Labor and Employment. Hence, since the apprenticeship agreement between petitioner and respondent has no force and effect, respondent's assertion that he was hired not as an apprentice but as a delivery boy deserves credence. c. Qualification
d. Allowed Employment
SEE: RA 7769, Sec. 4 (m) above Labor Code, Art. 60: - Only employers in the highly technical industries may employ apprentices and only in apprenticeable occupations approved by the Secretary of Labor and Employment.
e. Terms and Conditions

Art. 61: Apprenticeship agreements, including the wage rates of apprentices, shall conform to the rules issued by the Secretary of Labor and Employment. The period of apprenticeship shall not exceed six months. Apprenticeship agreements providing for wage rates below the legal minimum wage, which in no case shall start below 75 percent of the applicable minimum wage, may be entered into only in accordance with apprenticeship programs duly approved by the Secretary of Labor and Employment. The Department shall develop standard model programs of apprenticeship. Art. 72: The Secretary of Labor and Employment may authorize the hiring of apprentices without compensation whose training on the job is required by the school or training program curriculum or as requisite for graduation or board examination. SEE ALSO: Wage Order No. NCR-14, May 16, 2008
RA 7160, Sec. 12 as amended by RA 7658, Sec. 1: Children below fifteen (15) years of age shall not 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, 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 2) Where a child's employment or participation in public entertainment or information through cinema, theater, radio or television is essential: Provided, The employment contract is concluded by the child's parents or legal guardian, with the express agreement of the child concerned, if possible, and approval of the Department of Labor and Employment:
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f.
Enforcement
4) A commitment to employ the learners if they

so desire, as regular employees upon completion of the learnership. All learners who have been allowed or suffered to work during the first two (2) months shall be deemed regular employees if training is terminated by the employer before the end of the stipulated period through no fault of the learners. 5) The learnership agreement shall be subject to inspection by the Secretary of Labor and Employment or his duly authorized representative. Art. 76: Learners employed in piece or incentive-rate jobs during the training period shall be paid in full for the work done. Art. 77: Any violation of this Chapter or its implementing rules and regulations shall be subject to the general penalty clause provided for in this Code.
LABOR STANDARDS
Art. 65: Upon complaint of any interested person or upon its own initiative, the appropriate agency of the Department of Labor and Employment or its authorized representative shall investigate any violation of an apprenticeship agreement pursuant to such rules and regulations as may be prescribed by the Secretary of Labor and Employment. Art. 66: 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. 67: No person shall institute any action for the enforcement of any apprenticeship agreement or damages for breach of any such agreement, unless he has exhausted all available administrative remedies. Art. 71: An additional deduction from taxable income of one-half (1/2) of the value of labor training expenses incurred for developing the productivity and efficiency of apprentices shall be granted to the person or enterprise organizing an apprenticeship program: Provided, That such program is duly recognized by the Department of Labor and Employment: Provided, further, That such deduction shall not exceed ten (10%) percent of direct labor wage: and Provided, finally, That the person or enterprise who wishes to avail himself or itself of this incentive should pay his apprentices the minimum wage.
3. Differently-Abled Workers3 (asked in the 98 Bar) a. Coverage

RA 7277 Sec. 3: The Magna Carta for Disabled Persons or RA 7277 shall cover all disabled persons and, to the extent herein provided, departments, officers and agencies of the National Government or non-government organizations involved in the attainment of the objectives of this Act.
b. Definitions
RA 7277, Sec. 4(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 Sec. 4(b): Impairment is any loss, diminution or aberration of psychological, physiological, or anatomical structure or function Sec. 4(c): Disability shall mean: 1.) physical or mental impairment that substantially limits one or more psychological, physiological or anatomical function of an individual or activities of such individual; 2.) a record of such an impairment; 3.) or being regarded as having such an impairment Sec. 4(d): Handicap refers to a disadvantage for a given individual, resulting from an impairment or a disability, that limits or prevents the function or activity, that is considered normal given the age and sex of the individual.
2. Learners a. Definition
RA 7796, Sec. 4: "Learners" refers to persons hired as trainees in semi-skilled and other industrial occupations which are nonapprenticeable. Learnership programs must be approved by the authority
b. Allowed Employment
Art. 74: 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.
c.
Terms and Conditions of Employment
Art. 75. Any employer desiring to employ learners shall enter into a learnership agreement with them, which agreement shall include: 1) The names and addresses of the learners; 2) The duration of the learnership period, which shall not exceed three (3) months; 3) The wages or salary rates of the learners which shall begin at not less than seventyfive percent (75%) of the applicable minimum wage; and
c.
Rights and Privileges of Disabled Persons Equal Opportunity for Employees
RA 7277, Sec. 5, par. 1: No disabled person shall be denied access to opportunities for
3
Handicapped Workers in original text
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suitable employment. A qualified disabled EE shall be subject to the same terms and conditions of employment and the same compensation, privileges, benefits, fringe benefits, incentives or allowances as a qualified able-bodied person
Reserved Contractual Positions
Sec. 5: 5% of all casual, emergency and contractual positions in the DSWD; DOH, DepEd; and other government agencies, offices or corporations engaged in social development shall be reserved for disabled persons.
Sec. 8: 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 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 and the Department of Health as to his disability, skills, and qualifications.
LABOR STANDARDS
Tax Incentives for construction of disabled-friendly facilities (Sec 8, RA 7277)
Sheltered Employment
Sec. 6: If suitable employment for disabled persons cannot be found through open employment as provided in the immediately preceding Section, the State shall endeavor to provide it by means of sheltered employment. In the placement of disabled persons in sheltered employment, it shall accord due regard to the individual qualities, vocational goals and inclinations to ensure a good working atmosphere and efficient production.
Sec. 8: 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 50% of the direct costs of the improvements or modifications. This Section, however, does NOT apply to improvements or modifications or facilities required under BP 344.
e. Discrimination and Enforcement NOTE: This is a very important section. SEE RA 7277, Sec. 32-36. f. Enforcement: NOTE: This is a very important section. SEE RA 7277, Sec. 44-46.
Apprenticeship opportunity
Sec. 7: Disabled persons shall be eligible as apprentices or learners: Provided, that their handicap is NOT as much as to effectively impede the performance of job operations in the particular occupation for which they are hired; provided, further, That after the lapse of the period of apprenticeship, if found satisfactory in the job performance, they shall be eligible for employment.
Bernardo v. NLRC (1999): In this light, the Magna Carta for Disabled Persons mandates that a qualified disabled EE should be given the same terms and conditions of employment as a qualified able-bodied person. Since the Magna Carta accords them the rights of qualified able-bodied persons, they are thus covered by Article 280 of the Labor Code. In the present case, the handicap of petitioners (deaf-mutes) is NOT a hindrance to their work. The eloquent proof of this statement is the repeated renewal of their employment contracts. d. Incentives for Employers Tax Incentives for Employment Disabled Persons Of
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Chapter 5. Conditions of Labor

I. COVERAGE A. General rule B. Not covered II. HOURS OF WORK G. Normal hours of work H. Compensable hours of work--in general I. General principles in determining if time is considered as hours worked J. Specific rules determining hours of work and compensability K. Overtime work III. WEEKLY REST DAYS E. Coverage F. Scheduling rest day G. Compulsory work H. Premium pay IV. HOLIDAYS F. Coverage and exclusion G. Holidays covered H. Holiday pay computation I. Absences J. Non-working/scheduled rest day V. SERVICE INCENTIVE LEAVE A. Coverage and exemption B. Entitlement VI. PATERNAL LEAVE VII. PARENTAL LEAVE VIII. VICTIMS LEAVE
IRR Bk. III Rule I Sec 2a: Exemption. The provisions of this Rule shall not apply to the following persons if they qualify for exemption under the conditions set forth herein: a. Government employees whether employed by the National Government or any of its political subdivision, including those employed in government-owned and/or controlled corporations xxx
LABOR STANDARDS
2. Managerial Employees
Art. 82: "Managerial Employees" Refer to those whose primary duty consists of the management of the establishment in which they are employed or of a department or subdivision thereof, and to other officers or members of the managerial staff. IRR of Labor Code, Bk III, Rule 1, Sec. 2 (b) & (c): Exemption. The provisions of this Rule shall not apply to the following persons if they qualify for exemption under the conditions set forth herein: b. Managerial employees are covered (by the exemption) if they have the following characteristics: 1.) Their primary duty consists of the management of the establishment in which they are employed or of a department or sub-division thereof. 2.) They customarily and regularly direct the work of two or more employees therein. 3.) They have the authority to hire or fire employees of lower rank; or their suggestions and recommendations as to hiring and firing and as to the promotion or any other change of status of other employees, are given particular weight c. Officers or members of a managerial staff if they perform the following duties and responsibilities: 1.) The primary duty consists of the performance of work directly related to management policies of their employer; 2.) Customarily and regularly exercise discretion and independent judgment; and 3.) i. Regularly and directly assist a proprietor or a managerial employee whose primary duty consists of the management of the establishment in which he is employed or subdivision thereof; or ii. execute under general supervision work along specialized or technical lines requiring special training, experience, or knowledge; or iii. execute, under general supervision, special assignments and tasks; and 4.) Who do not devote more than 20 percent of their hours worked in a work week to activities which are not directly and closely related to the performance of the work described in paragraphs (1), (2) and (3) above.
I. COVERAGE
A. GENERAL RULE
Art. 82: The provisions of this Title shall apply to employees in all establishments and undertakings whether for profit or not.
B. NOT COVERED:
Labor Code, Art. 82: but not to government employees, managerial employees, field personnel, members of the family of the employer who are dependent on him for support, domestic helpers, persons in the personal service of another, and workers who are paid by results as determined by the Secretary of Labor in appropriate regulations. SEE ALSO: IRR of Labor Code, BK. III, Rule I, Sec. 1-2
1. Government employees
Labor Code, Art. 76: The terms and conditions of employment of all government employees, including employees of government-owned and controlled corporations, shall be governed by the Civil Service Law, rules and regulations.
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3. Field Personnel
Art. 82: "Field personnel" shall refer to nonagricultural employees who regularly perform their duties away from the principal place of business or branch office of the employer and whose actual hours of work in the field cannot be determined with reasonable certainty.
6. Persons in service of another Bk III, Rule 1, Sec. 2(d) of the IRR: Exemption. The provisions of this Rule shall
not apply to the following persons if they qualify for exemption under the conditions set forth herein: Domestic servants and persons in the personal service of another if they perform such services in the employers home which are usually necessary or desirable for the maintenance and enjoyment thereof, or minister to the personal comfort, convenience, or safety of the employer as well as the members of his employers household.
LABOR STANDARDS
Tests: Field Personnel Union of Filipro Employees v. Vivar (1992): The clause "whose time and performance is unsupervised by the employer" did not amplify but merely interpreted and expounded the clause "whose actual hours of work in the field cannot be determined with reasonable certainty." The former clause is still within the scope and purview of Article 82 which defines field personnel. Hence, in deciding whether or not an EE's actual working hours in the field can be determined with reasonable certainty, query must be made as to whether or not such EE's time and performance is constantly supervised by the employer. Salazar v. NLRC (1996): Actual hours work in the field is to be read in conjunction with Rule IV, Book III of the Implementing Rules. Therefore field personnel are EEs whose time and performance is unsupervised by the employer. Auto Bus Transport Systems, Inc. v. Bautista (2005): If required to be at specific places at specific times, employees including drivers cannot be said to be field personnel, despite the fact that they are performing work away from principal office of EE.
7. Piece workers Bk III, Rule 1, Sec. 2(e) of the IRR: Exemption. The provisions of this Rule shall
not apply to the following persons if they qualify for exemption under the conditions set forth herein: Workers who are paid by results, including those who are paid on piece-work, takay, pakiao or task basis, and other non-time work if their output rates are in accordance with the standards prescribed under Section 8, Rule VII, Book Three of these regulations, or where such rates have been fixed by the Secretary of Labor and Employment in accordance with the aforesaid Section.
Red V Coconut Products Ltd., v. CIR (1966): Philosophy underlying the exclusion of piece workers from the 8hour law is that said workers are paid depending upon the work they do irrespective of the amount of time employed in doing said work.
II. HOURS OF WORK

A. NORMAL HOURS OF WORK
Art. 83: The normal hours of work of any employee shall not exceed eight (8) hours a day.
4. Dependent Family Members 5. Domestic helpers

Art. 141: "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.
For health personnel:
Art. 38: 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.
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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.
b. if the interval is too brief to be utilized effectively and gainfully in the employees own interest D. SPECIFIC RULES DETERMINING HOURS OF WORK AND COMPENSABILITY
NOTE: (Except as otherwise indicated, IRR refers to Book III, Rule I of the Omnibus Rules Implementing The Labor Code.)
LABOR STANDARDS
B. COMPENSABLE HOURS OF WORK IN GENERAL

Art. 84: 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.
1. Rest period a. Short duration or coffee break:

Art. 84, par. 2: Rest periods of short duration during working hours shall be counted as hours worked. IRR Sec. 7, par. 2: Rest periods or coffee breaks running from five (5) to twenty (20) minutes shall be considered as compensable working time.
C. GENERAL PRINCIPLES IN DETERMINING IF TIME IS CONSIDERED AS HOURS WORKED According to Book III, Rule 1, Sec. 4, the following principles shall govern in determining whether the time spent by and employee is considered hours worked for purposes of this Rule: All hours are hours worked a. which the employee is required to give his employer, b. regardless of whether or not such hours are spent in productive labor or involve physical or mental exertion. An employee need not leave the premises of the work place in order that his rest period shall not be counted, a. it being enough that he stops working, may rest completely b. and may leave his work place, to go elsewhere, whether within or outside the premises of his work place. If the work performed was necessary, or it benefited the employer, or the employee could not abandon his work at the end of his normal working hours because he had no replacement, all time spent for such work shall be considered as hours worked, if the work was with the knowledge of his employer or immediate supervisor. The time during which an employee is inactive by reason of interruptions in his work beyond his control shall be considered working time either: a. if the imminence of the resumption of work requires the employees presence at the place of work or
b. More than 20 minutes

IRR Sec 4 (b): An employee need not leave the premises of the work place in order that his rest period shall not be counted, it being enough that he stops working, may rest completely and may leave his work place, to go elsewhere, whether within or outside the premises of his work place.
1.
2.
2. Meal Period a. Regular Meal

Art. 85: 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. IRR Sec. 7: Every employer shall give his employees, regardless of sex, not less than one (1) hour time-off for regular meals,
3.
b. Shorter Meal Period (Less than 1 Hr., but not less than 20 min.)
IRR, Sec. 7: a meal period of not less than twenty (20) minutes may be given by the employer provided that such shorter meal period is credited as compensable hours worked of the employee: (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 Page 40 of 161
4.
suffer; and (d) Where the work is necessary to prevent serious loss of perishable goods.
5. On Call
IRR Sec. 5(b): An employee who is required to remain on call in the employers premises or so close thereto that he cannot use the time effectively and gainfully for his own purpose shall be considered as working while on call. An employee who is not required to leave word at his home or with company officials where he may be reached is not working while on call.
LABOR STANDARDS
Pan-American Airways v. Pan-American Employees Association (1961): During meal period, the laborers are required to stand by for emergency work, or where said meal hour is not one of complete rest, such period is considered overtime. Phil. Airlines, Inc. v. NLRC (1999): The eight-hour work period does not include the meal break. Employees are not prohibited from going out of the premises as long as they return to their posts on time.
6. Waiting Time
IRR 5(a): Waiting time spent by an employee shall be considered as working time if waiting is an integral part of his work or the employee is required or engaged by the employer to wait.
3. Continuous Work State Marine Corporation v. Cebu Seamens Association (1963): The provision of section 1 of Commonwealth Act No. 444, which states that "when the work is not continuous, the time during which the laborer is not working and can leave his working place and can rest completely shall not be counted", finds no application in the present case, where the laborer's work is continuous, and during the time that he is not working he can not leave and completely rest owing to the place and nature of his work. 4. Idle Time National Development Co. v. CIR (1962): The idle time that an employee may spend for resting & dining which he may leave the spot or place of work though not the premises of his employer, is not counted as working time only where the work is broken or is not continuous. Luzon Stevedoring Co. v. Luzon Marine Department Union (1957): A laborer need not leave the premises of the factory, shop or boat in order that his period of rest shall not be counted, it being enough that he "cease to work", may rest completely and leave or may leave at his will the spot where he actually stays while working, to go somewhere else, whether within or outside the premises of said factory, shop or boat. If these requisites are complied with, the period of such rest shall not be counted.
Arica v. NLRC (1989): The thirty (30)minute assembly is a deeply-rooted, routinary practice of the employees, and the proceedings attendant thereto are not infected with complexities as to deprive the workers the time to attend to other personal pursuits.
7. Inactive Due To Work Interruptions

IRR 4(d): The time during which an employee is inactive by reason of interruptions in his work beyond his control shall be considered working time either if the imminence of the resumption of work requires the employee's presence at the place of work or if the interval is too brief to be utilized effectively and gainfully in the employee's own interest.
8. Travel Time Rada v NLRC (1992): The fact that he picks up employees of Philnor at certain specified points along EDSA in going to the project site and drops them off at the same points on his way back from the field office going home is not merely incidental to petitioner's job as a driver. On the contrary, said transportation arrangement had been adopted, not so much for the convenience of the employees, but primarily for the benefit of the employer, herein private respondent. Since the assigned task of fetching and delivering employees is indispensable and consequently mandatory, then the time required of and used by petitioner in going from his residence to the field office and back, which the labor arbiter rounded off as averaging three hours each working day, should be paid as overtime work.
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9. Entry Time Cards Aklan Electric Coop., Inc. v. NLRC (2000):It is an error to rely solely on the computations of compensable services submitted by private resources. There must be competent proof such as time cards / office records to show that they actually rendered compensable service during the stated period to entitle them to wages. 10. Lectures, Meetings, Trainings
IRR Sec. 6 Attendance at lectures, meetings, training programs, and other similar activities shall not be counted as working time if ALL of the following conditions are met: Attendance is outside of the employees regular working hours; Attendance is in fact voluntary; and The employee does not perform any productive work during such attendance.
d.
e.
performed on machines, installations, or equipment, in order to avoid serious loss or damage to the employer or some other cause of similar nature; When the work is necessary to prevent loss or damage to perishable goods; and Where the completion or continuation of the work started before the eighth hour is necessary to prevent serious obstruction or prejudice to the business or operations of the employer.
LABOR STANDARDS
3. No Offsetting
Art. 88: 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.
E. OVERTIME WORK NOTE: SEE ALSO: IRR of Labor Code, Sec. 7-10 1. Overtime On Ordinary Working Day
Art. 87. 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. 90. Computation of additional compensation. For purposes of computing overtime and other additional remuneration as required by this Chapter, the "regular wage" of an employee shall include the cash wage only, without deduction on account of facilities provided by the employer.
4. Compressed Workweek NOTE: SEE DOLE Advisory No. 02, Series of 2004 for details. This is important. Under the CWW scheme, the normal workday goes beyond eight hours without the corresponding overtime premium. The total hours of work, however, shall not exceed 12 hours a day or 48 hours a week, or the employer is obliged to pay the worker the overtime premium in excess of said work hours.
2. Emergency or Overtime
Art. 89: Any employee may be required by the employer to perform overtime work in any of the following cases: a. When the country is at war or when any other national or local emergency has been declared by the National Assembly or the Chief Executive; b. When it is necessary to prevent loss of life or property or in case of imminent danger to public safety due to an actual or impending emergency in the locality caused by serious accidents, fire, flood, typhoon, earthquake, epidemic, or other disaster or calamity; c. When there is urgent work to be
5. Cases a. When Basic Contract Does Not Include Overtime Pay Manila Terminal Co. Inc v. CIR (1952): A contract of employment, which provides for a weekly wage for a specified number of hours, sufficient to cover both the statutory minimum wage and overtime compensation, if computed on the basis of the statutory minimum, and which makes no provision for a fixed hourly rate or that the weekly wage includes overtime compensation, does not meet the requirements of the [law]. b. Built-in Compensation Engineering Equipment Inc v. MOLE (1985): Written contracts with a "builtin" overtime pay in the ten-hour working day and that their basic monthly pay was adjusted to reflect the higher amount covering the guaranteed two-hour extra time whether worked or unworked are valid.
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c. Proof of Work Lagatic v. NLRC (1998): Entitlement to overtime pay must first be established by proof that said overtime work was actually performed, before an employee may avail of said benefit. Villar v. NLRC (2000): Where the veracity of the alleged documents as payrolls are doubtful considering that the laborers paid therein never affixed their signatures to show that they actually received the amounts indicated, the fact that a particular laborers name does not appear is no proof that he did not work in the workplace. Unwavering testimonies of laborers employment prevail over incomplete & inconsistent documentary evidence of employer. d. Employer Obligation Social Security System v. Court of Appeals (2000): Employer is dutybound to keep faithful & complete records of his business affairs, not the least of which would be the salaries of the workers.
III.WEEKLY REST PERIODS

NOTE: See IRR of Labor Code Book III, Rule III A. COVERAGE
Art. 94 (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.
LABOR STANDARDS
B. SCHEDULING OF REST DAY

Art. 94 (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.
C. COMPULSORY WORK
Art. 92. When employer may require work on a rest day. The employer may require his employees to work on any day: a.) In case of actual or impending emergencies caused by serious accident, fire, flood, typhoon, earthquake, epidemic or other disaster or calamity to prevent loss of life and property, or imminent danger to public safety; b.) In cases of urgent work to be performed on the machinery, equipment, or installation, to avoid serious loss which the employer would otherwise suffer; c.) In the event of abnormal pressure of work due to special circumstances, where the employer cannot ordinarily be expected to resort to other measures; d.) To prevent loss or damage to perishable goods; 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 f.) Under other circumstances analogous or similar to the foregoing as determined by the Secretary of Labor and Employment.
F. NIGHT WORK NOTE: SEE IRR of Labor Code, Book III, Rule II, Sec. 1-6
Art. 86- Every employee shall be paid a night shift differential of not less than ten percent (10%) of his regular wage for each hour of work performed between ten oclock in the evening and six oclock in the morning. IRR SEC. 1 This Rule (On night shift differential) covers all employees except: a. Those of the government and any of its political subdivisions, including governmentowned and/or controlled corporations; b. Those of retail and service establishments regularly employing not more than five (5) workers; c. Domestic helpers and persons in the personal service of another; d. Managerial employees as defined in Book Three of this Code; e. Field personnel and other employees whose time and 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 thereof.
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D. PREMIUM PAY NOTE: SEE DOLE Memorandum Circular 1, Series of 2004. This is important.
WHEN WORK PERFORMED On scheduled rest day On Sunday ONLY IF ESTABLISHED rest day No regular work and rest days PREMIUM PAY 30% of regular wage 30% of regular wage 30% of regular wage for work performed on Sundays and holidays 30% of regular wage
On any special holiday /special day On any special holiday 50% of regular wage /special day falling on scheduled rest day On any regular holiday 230% of regular wage falling on scheduled rest day Art. 93(d): Where the collective bargaining agreement or other applicable employment contract stipulates the payment of a higher premium pay than that prescribed under this Article, the employer shall pay such higher rate. IRR Book III, Rule III, Sec. 8: Nothing in this Rule shall justify an employer in reducing the compensation of his employees for the unworked Sundays, holidays, or other rest days which are considered paid-off days or holidays by agreement or practice subsisting upon the effectivity of the Code. Sec. 9. : Nothing herein shall prevent the employer and his employees or their representatives in entering into any agreement with terms more favorable to the employees than those provided herein, or be used to diminish any benefit granted to the employees under existing laws, agreements, and voluntary employer practices.
Asian Transmission vs. CA (2004):Holiday pay is a legislated benefit enacted as part of the Constitutional imperative that the State shall afford protection to labor. Its purpose is not merely "to prevent diminution of the monthly income of the workers on account of work interruptions. although the worker is forced to take a rest, he earns what he should earn, that is, his holiday pay. It is also intended to enable the worker to participate in the national celebrations held during the days identified as with great historical and cultural significance.
LABOR STANDARDS
B. HOLIDAYS COVERED
NOTE: Art. 94 (c) was superseded by E.O. 203, which was subsequently amended by RA 9177, 9256, and 9492. RA 9492, Sec. 26: Unless otherwise modified by law, and or proclamation, the following regular holidays and special days shall be observed in the country: 1) 2) 3) 4) 5) Regular Holidays New years Day - January 1 Maundy Thursday - Movable date Good Friday - Movable date Eidul Fitr - Movable date Araw ng Kagitingan- Monday nearest April 9 (Bataan and Corregidor Day) 6) Labor Day - Monday nearest May 1 7) Independence Day - Monday nearest June 12 8) National Heroes Day - Last Monday of August 9) Bonifacio Day - Monday nearest November 30 10) Christmas Day - December 25 11) Rizal Day - Monday nearest December 30 Nationwide Special Holidays: 1) Ninoy Aquino Day - Monday nearest August 21 2) All Saints Day - November 1 3) Last Day of the Year - December 31 In the event the holiday falls on a Wednesday, the holiday will be observed on the Monday of the week. If the holiday falls on a Sunday, the holiday will be observed on the Monday that follows. Provided, That for movable holidays, the President shall issue a proclamation, at least six months prior to the holiday concerned, the specific date that shall be declared as a nonworking day Provided, however, The Eidul Adha shall be celebrated as a regional holiday in the Autonomous Region in Muslim Mindanao.
IV. HOLIDAYS
A. COVERAGE AND EXCLUSION
Art. 94(a) : Every worker shall be paid his regular daily wage during regular holidays, except in retail and service establishments regularly employing less than ten (10) workers IRR of RA 6727 or the Wage Rationalization Act f)"Retail Establishment" is one principally engaged in the sale of goods to end-users for personal or household use; g)"Service Establishment" is one principally engaged in the sale of service to individuals for their own or household use and is generally recognized as such;
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P.D. 1083 (Code of Muslim Personal Laws) SEE: Arts. 169-173 San Miguel Corp vs. CA (2002): There should be no distinction between Muslims & non-Muslims as regards to the payment of benefits for Muslim holidays. Wages & other emoluments granted by law to the working man are determined on the basis of the criteria laid down by laws & not on workers faith. Art. 3(3), PD 1083 states that nothing herein shall be construed to operate to the prejudice of a nonMuslim.
2. Double Holiday Pay

According to DOLE Explanatory Bulletion on Workers Entitlement to Holiday Pay on 9 April 1993, if two holidays fall on the same day: 1) If unworked, 200% of basic wage. 2) If worked, 300% of basic wage (AZUCENA).
LABOR STANDARDS
C. HOLIDAY PAY COMPUTATION SEE: Art. 94 Labor Code, Book III, Rule IV of IRR, RA 9424 and DOLE Memorandum Circular 1 Series of 2004 1. General Rule
An employer may require an employee to work on any holiday but such employee shall be paid a compensation equivalent to twice his regular rate.
3. Successive Holiday Pay According to IRR, Rule IV, Sec. 10, Employee entitled to holiday pay for both days, IF: a. he is present on day immediately preceding first holiday, or b. he works on first holiday, which entitles him to pay on second holiday.
NOTE: SEE IRR Book III, Rule IV, Sec. 10
4. Sundays
Letter of Instruction No. 1087: a. When a holiday falls on a Sunday, the following Monday will not be considered a holiday unless a proclamation says so. b. Furthermore as stated in the Wellington case (see below), a holiday falling on a Sunday does not create an obligation to pay extra, aside from the usual holiday pay, to monthly-paid employees (AZUCENA)
According to the LC, IRR and Memo:

200% of regular daily wage 200% of regular wage + 30% of amount 200% of regular wage + 30% of amount daily such daily such
Work on any regular holiday, not exceeding 8 hours Work on any regular holiday, if it exceeds 8 hours/overtime Work on any regular holiday which falls on the scheduled rest day, not exceeding 8 hours Work on any any regular holiday which falls on scheduled rest day, if it exceeds 8 hours/overtime Work on special holiday not exceeding 8 hours Work on special holiday falling on employees scheduled rest day
Regular holiday-onrest day rate (200% of regular daily wage plus 30% of such amount) + 30% of said rate. Regular daily wage + 30% thereof Regular daily wage + 50% thereof
NOTE: a. According to DOLE Memo Circular 1-04, a special holiday/special day includes the National Special Days, and declared special days such as Special Non-working Holiday, Special Public Holiday and Special National Holiday. Such days are entitled to the rates prescribed above. These days are not the same as a special working holiday. b. A special working holiday is considered an ordinary working day, so there is no premium pay.
5. Cases Relevant to Computation a. Hourly-Paid Faculty Members Jose Rizal College vs. NLRC (1987): Hourly-paid faculty members need not be paid for unworked regular holidays, but petitioner must pay them their regular hourly rate on days declared as special holidays or when classes are called off or shortened, and when classes are extended. b. Divisor Union of Filipro Employees vs. Vivar (1992): Divisor assumes important role in determining whether or not holiday pay is already computed. In this case, the formula of (monthly rate x 12 months)/251 shows that holiday pay was not included. If ten holidays were covered, divisor of 261 should have been used. Insisting that 261 be used as divisor when ten holidays were not covered lessens salary and violates nondiminution of benefits under Labor Code. It must also be stressed that the daily rate, is the basis for computing 10 unpaid holidays.
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If then employees annual salary is P25, 100, dividing it by 251 will result in having a daily rate of 100. After payment of ten days holiday pay, it must be P26,100; then it must be divided by 261 to maintain daily rate of 100.
Employees who are on leave of absence without pay on the day immediately preceding a regular holiday may not be paid the required holiday pay if he has not worked on such regular holiday.
LABOR STANDARDS
E. NON-WORKING/SCHEDULED DAY
IRR, Bk III Rule V Sec 6 (c):
REST
Trans-asia Phil. Employees Assoc. vs. NLRC (1999): Trans-Asia's inclusion of holiday pay in petitioners' monthly salary is established by its consistent use of the divisor of "286" days in the computation of its employees' benefits and deductions. If one is to deduct the unworked 52 Sundays and 26 Saturdays (derived by dividing 52 Saturdays in half since petitioners are required to work half-day on Saturdays) from the 365 calendar days in a year, the resulting divisor would be 286 days (should actually be 287 days). Since the ten holidays were never included in subtracting the unworked and unpaid days in a calendar year, the only logical conclusion would be that the payment for holiday pay is already incorporated into the said divisor. c. Holidays Falling On A Sunday Wellington vs. Trajano (1995): Supreme Court disagreed with Regional Director who said that if a holiday fell on Sunday, an extra day of pay was created; thus, an employee should pay twice the amount of holiday pay on that day. In fixing the salary, Wellington simply deducted 51 Sundays from the 365 days normally comprising a year and used the difference, 314, as divisor for determining the monthly salary. The monthly salary thus fixed actually covers payment for 314 days of the year, including regular and special holidays. No provision of law requires any employer to make adjustments in the monthly salary rate set by him to take account of legal holidays falling on Sundays in a given year, otherwise to reckon a year at more than 365 days.
Where the day immediately preceding the holiday is a non-working day in the establishment or the scheduled rest day of the employee, he shall not be deemed to be on leave of absence on that day, in which case he shall be entitled to the holiday pay if he worked on the day immediately preceding the non-working day or rest day.
V.SERVICE INCENTIVE LEAVE

A. COVERAGE/EXEMPTION
Art. 95. Right to service incentive leave. a. Every employee who has rendered at least one year of service shall be entitled to a yearly service incentive leave of five days with pay. b. This provision shall not apply to those 1) who are already enjoying the benefit herein provided, 2) those enjoying vacation leave with pay of at least five days and 3) those employed in establishments regularly employing less than ten employees or 4) in establishments exempted from granting this benefit by the Secretary of Labor and Employment after considering the viability or financial condition of such establishment. IRR BK III, Rule V Sec. 3: The term "at least one-year service" shall mean service for not less than 12 months, whether continuous or broken, reckoned from the date the employee started working, including authorized absences and paid regular holidays unless the working days in the establishment as a matter of practice or policy, or that provided in the employment contract is less than 12 months, in which case said period shall be considered as one year.
D. ABSENCES
IRR, Bk III Rule V Sec 6(a): All covered employees shall be entitled to the benefit provided herein when they are on leave of absence with pay.
Makati Haberdashery vs. NLRC (1989): They are not entitled to service incentive leave pay because as piece-rate workers being paid at a fixed amount for performing work irrespective of time consumed in the performance thereof, they fall under one of the exceptions stated in Section 1(d), Rule V, Book III, IRR of Labor Code.
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Labor Congress vs. NLRC (1998): Court held that petitioners are entitled to service incentive leave. Court concluded that factors lead us to conclude that petitioners, although piece-rate workers, were regular employees of private respondents.
RA 8972 (Solo Parents Welfare Act of 2000)

NOTE: SEE Sec. 3(a) for definition of term Solo Parent Section 6. Flexible Work Schedule. - The employer shall provide for a flexible working schedule for solo parents: Provided, That the same shall not affect individual and company productivity: Provided, further, That any employer may request exemption from the above requirements from the DOLE on certain meritorious grounds. Section 7. Work Discrimination. - No employer shall discriminate against any solo parent employee with respect to terms and conditions of employment on account of his/her status. Section 8. Parental Leave. - In addition to leave privileges under existing laws, parental leave of not more than seven (7) working days every year shall be granted to any solo parent employee who has rendered service of at least one (1) year.
LABOR STANDARDS
B. ENTITLEMENT
Art. 95 (c): The grant of benefit in excess of that provided herein shall not be made a subject of arbitration or any court or administrative action. IRR Sec. 5 The service incentive leave shall be commutable to its money equivalent if not used or exhausted at the end of the year.
Auto Bus Transport vs. NLRC (2005): The cause of action of an entitled employee to claim his service incentive leave pay accrues from the moment the employer refuses to remunerate its monetary equivalent if the employee did not make use of said leave credits but instead chose to avail of its commutation (into money). Accordingly, if the employee wishes to accumulate his leave credits and opts for its commutation upon his resignation or separation from employment, his cause of action to claim the whole amount of his accumulated service incentive leave shall arise when the employer fails to pay such amount at the time of his resignation or separation from employment.
VIII. VICTIMS LEAVE

RA 9262 (Anti-Violence Against Women and Their Children Act of 2004), Sec.
43: Victims under this Act shall be entitled to take a paid leave of absence up to ten (10) days in addition to other paid leaves under the Labor Code and Civil Service Rules and Regulations, extendible when the necessity arises as specified in the protection order. Any employer who shall prejudice the right of the person under this section shall be penalized in accordance with the provisions of the Labor Code and Civil Service Rules and Regulations. Likewise, an employer who shall prejudice any person for assisting a co-employee who is a victim under this Act shall likewise be liable for discrimination.
VI. PATERNAL LEAVE RA (Paternity Leave Act of Sec. 2:
8187 1996)
Notwithstanding any law, rules, and regulations to the contrary, every married male employee in the private and public sectors shall be entitled to a paternity leave of 7 days with full pay for the first four deliveries of the legitimate spouse with whom he is cohabiting. The male employee applying for paternity leave shall notify his employer of the pregnancy of his legitimate spouse and the expected date of such delivery.For purposes of this Act, delivery shall include childbirth or any miscarriage.
VII.
PARENTAL LEAVE
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Chapter 6. Wages
I. WAGES GENERAL CONCEPT A. Definition of Wage B. Coverage C. No work No Pay D. Equal Pay for Equal Work / Non Discrimination E. Facilities and supplements F. Commission G. Wages and Salary H. Gratuity I. Payment by results MINIMUM WAGES AND WAGE FIXING MACHINERY A. Constitutional Basis B. Agencies for Wage-Fixing Machinery C. No work No Pay D. Minimum Wages and Criteria E. Wage Distortion F. Special Cases G. Summary of Effects on Wages PAYMENT OF WAGES A. Form of Payment B. Time of Payment C. Place of Payment D. Direct Payment E. Contractor Subcontractor F. Prohibition Regarding Wages OTHER FORMS OF REMUNERATION A. Service Charges B. 13th Month Pay C. Bonus D. Productivity Incentives E. Contractor Subcontractor F. Prohibition Regarding Wages WAGE RECOVERY, LIABILITIES, AND WORKER PREFERENCE A. Worker Preference in Case of Bankruptcy B. Attorneys Fees
6. Fair and reasonable value - shall not include any profit to the employer, or to any person affiliated with the employer. B. COVERAGE: THE LABOR CODE TITLE ON WAGES SHALL NOT APPLY TO THE FOLLOWING: (ART. 98 AND IRR) 1. Farm tenancy or leasehold; 2. Household or domestic helpers, including family drivers and other persons in the personal service of another; 3. Homeworkers engaged in needlework; 4. Workers in registered cottage industries who actually work at home; 5. Workers in registered cooperatives when so recommended by the Bureau of Cooperative Development upon approval of the Secretary of Labor (IRR Book III Rule 7 Sec 3); 6. Workers in registered barangay micro business enterprise (RA 9178). C. NO WORK NO PAY Aklan Electric Cooperative, Inc. vs. NLRC (2000) General Rule: a fair days wage for a fair days labor or no work no pay Except when the laborer was able, willing and ready to work but was illegally locked out, suspended or dismissed, or otherwise illegally prevented from working.
LABOR STANDARDS
II.
III.
IV.
V.
I. WAGES GENERAL CONCEPT

A. DEFINITION OF WAGE Art. 97(f) 1. It is the remuneration or earnings, however designated capable of being expressed in terms of money, 2. whether fixed or ascertained on a time, task, piece, or commission basis, or other method of calculating the same, 3. which is payable by an employer to an employee 4. under a written or unwritten contract of employment for work done or to be done, or for services rendered or to be rendered and 5. 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
D. EQUAL PAY FOR EQUAL WORK/NONDISCRIMINATION International School Alliance of Educators vs. Quisumbing (2000) If an employer accords the same position and rank, the presumption is that the employees perform equal work. Employees, if they are performing similar functions and responsibilities under similar working conditions, should receive the same pay.
E. FACILITIES AND SUPPLEMENTS 1. Definition a. The IRR definition (IRR Book III Rule 7-A Sec. 5) has 2 components: Facilities are articles or services for the benefit of the employee or his family This 1st part defines facilities.
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Facilities shall not include tools of the trade or articles or service primarily for the benefit of the employer or necessary to the conduct of the employers business. This 2nd part is essentially what a supplement is. Facilities are items of expense necessary for the laborers and his familys existence and subsistence. (States Marine Corp. v. Cebu Seamen's Assoc., Inc., 1963)
G. WAGES AND SALARY 1. Wages and Salary are in essence synonymous. (Songco v. NLRC, 1990) 2. There are slight differences:
Wage Paid for skilled or unskilled manual labor Not subject to execution, garnishment or attachment except for debts related to necessities (Art. 1708) Salary Paid to white collar workers and denote a higher grade of employment Not exempt from execution, garnishment or attachment (Gaa vs. CA, 1985)
LABOR STANDARDS
2. Comparison between Facilities and Supplements

Category What it is not much difference here Facilities Articles or services/ items of expense Supplements Extra remuneration or special benefits / articles or services / tools of the trade For the benefit or convenience of the Employer
Purpose
How Treated
For the benefit of the Employee and his family; for their existence and subsistence Part of Wage so it is deductible
Independent of the Wage so not deductible
3. Requirements for deducting value of facilities (Mabeza v. NLRC, 1997) a. Customarily furnished by the trade Millares v. NLRC (1999) "Customary" is founded on longestablished and constant practice connoting regularity. The receipt of an allowance on a monthly basis does not ipso facto characterize it as regular and forming part of salary because the nature of the grant is a factor worth considering. b. Voluntarily accepted in writing by the employee; and c. Charged at fair and reasonable value. F. COMMISSION 1. Definition: it is the recompense, compensation or reward of an agent, salesman, executor, trustee, receiver, factor, broker or bailee, when the same is calculated as a percentage on the amount of his transactions or on the profit to the principal. (Iran v. NLRC, 1998) 2. Treatment: part of wage as well
H. GRATUITY Plastic Town Center Corp. v. NLRC (1989) It is something given freely, or without recompense, a gift, in return for a favor or services; a bounty; a tip. It is a money benefit given to the workers the purpose of which is to reward employees or laborers, who have rendered satisfactory and efficient service to the company) It is not intended to pay a worker for actual services rendered. It is not mandatory. I. PAYMENT BY RESULTS
Art. 101: Workers who are paid a standard amount for every piece of work produced or on a piece-rate basis are of 2 categories: 1. Regular piece-rate workers work directly under the employers supervision 2. They are entitled to the ff: (Labor Congress of the Phil. vs. NLRC, 1998) a. Appropriate minimum wage b. Service incentive leave of 5 days c. Night shift if applicable d. Holiday pay e. Meal and rest periods f. Overtime pay only if the Employees output rates are NOT in accordance with DOLE standards in the IRR or fixed by the Secretary (IRR Book III Rule VII Sec. 8) g. Premium pay conditional; same as overtime pay h. 13th month pay
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i.
Other benefits set forth by CBA or applicable laws
3. Pakiao or takay category do not work in the company premises and are not directly supervised
II. MINIMUM WAGES AND FIXING MACHINERY

A. CONSTITUTIONAL BASIS
WAGE-
1. Constitution guarantees the right of the Employee to a living wage. (Art. XIII Sec. 3, 1987 Constitution) 2. The minimum wage can by no means imply only the actual minimum. 3. Some margin or leeway must be provided, over and above the minimum, to take care of contingencies, such as increase of prices of commodities and increase in wants, and provide means for a desirable improvement in his mode of living. (Atok Big Wedge Mining Co., Inc. v. Atok Big Wedge Mutual Benefit Assoc., 1953) 4. It is not dependent on the Employers ability to pay (De Racho vs. Municipality of Iligan, 1968) B. AGENCIES MACHINERY FOR WAGE-FIXING
ii. NEDA Director-General vice chair iii. 2 members each from workers and employer sectors: a) who shall be appointed by the President upon recommendation of the Secretary of Labor b) to be made on the basis of the list of nominees submitted by the workers & employers sectors, respectively, and c) who shall serve for a term of 5 years. iv. Executive Director of the Commission Secretariat v. The Commission shall be assisted by a Secretariat headed by an Executive Director 2. Regional Tripartite Wages and Productivity Board (Regional Board) a. Created thru Art. 122 b. Commission lays down the guidelines which the Regional Board implements. (Nasipit Lumber Co. v. NLRC, 1998) c. NWPC does not set the minimum wage. d. Powers and Functions in their respective territorial jurisdiction (Art. 122) To develop plans, programs and projects relative to wages, incomes and productivity improvement for their respective regions; (Art. 122a) To determine and fix minimum wage rates applicable in their respective regions, provinces or industries therein and to issue the corresponding wage orders, subject to guidelines issued by the Commission; (Art. 122b) Wage order establishes the minimum wage rates to be paid by the employer in the region. There are two methods of fixing wages: Floor wage method determinate amount put on top of prevailing statutory minimum Salary ceiling method wage adjustment applied to Employees receiving a certain denominated ceiling i. To receive, process and act on applications for exemption from prescribed wage rates as
LABOR STANDARDS
1. National Wages and Productivity Commission (Commission) a. Created thru Art. 120; attached to the DOLE for policy and program coordination. b. Powers and Functions of the Commission (Art. 121) i. prescribe rules and guidelines for the determination of appropriate minimum wage and productivity measures at the regional, provincial or industry levels; (Art. 121c) ii. To review regional wage levels set by the Regional Tripartite Wages and Productivity Boards to determine if these are in accordance with prescribed guidelines and national development plans; (Art. 121d) iii. Other powers and functions (Art. 121) c. Composition of the Commission: i. DOLE Secretary chair
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may be provided by law or any Wage Order; (Art. 122e) ii. Other powers and functions (Art. 122) e. Composition of each Regional Board: i. DOLE Regional Director chair ii. NEDA and DTI Regional Directors of NEDA & DTI vice chairs iii. 2 members each from workers and employers sectors who shall be appointed by the President upon 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 5 years. C. MINIMUM WAGES AND CRITERIA
EXCEPT: when Congress passes a new law affecting wages or other supervening circumstances If it decides to ISSUE a wage order, the wage order takes effect after 15 days from complete publication in at least 1 newspaper of general circulation in the region d. Appeal wage order to Commission within 10 calendar days; mandatory for the Commission to decide within 60 calendar days from filing Filing of an appeal DOES NOT STAY order unless appellant files an undertaking with a surety, to guarantee payment of employees if the wage order is affirmed (as amended by RA 6727)
LABOR STANDARDS
D. NON-DIMINUTION RULE 1. General rule: prohibition against elimination or diminution of benefits (Art. 100) 2. Requisites: If the following are met, then the employer cannot remove or reduce benefits: a. Ripened company policy: Benefit is founded on a policy which has ripened into a practice over a long period (Prubankers Assn. vs. Prudential Bank and Co., 1999) b. Practice is consistent and deliberate and c. not due to error in the construction or application of a doubtful or difficult question of law. (Globe Mackay Cable vs. NLRC, 1988) d. Unilateral withdrawal or diminution by employer. 3. When not Applicable: when at least one of the requisites is absent. Benefits initiated through negotiation between Employee and Employer, e.g. CBA, can only be eliminated or diminished bilaterally. E. WAGE DISTORTION 1. Definition: a situation where an increase in prescribed wage rates 2. results in the elimination or severe contraction of intentional quantitative differences in wage or salary rates between and among employee groups in an establishment 3. as to effectively obliterate the distinctions embodied in such wage structure 4. based on skills, length of service, or other logical bases of differentiation
1. Factors/Criteria in determining regional minimum wages: (Art. 124)(DXCN IS PREQ) a. The demand for living wages; b. Wage adjustment vis-a-vis the consumer price index; c. The cost of living and changes or increases therein; d. The needs of workers and their families; e. The need to induce industries to invest in the countryside; f. Improvements in standards of living; g. The prevailing wage levels; h. Fair return of the capital invested and capacity to pay of employers; i. Effects in employment generation and family income; and j. The equitable distribution of income and wealth along the imperatives of economic and social development. 2. Procedure for Wage Fixing by Regional Board (Art. 123) a. Investigate and study pertinent facts, based on criteria set in Art. 124 b. Conduct public hearings or consultations with notice to employer and employee groups, provinces, city, municipal officials and other interested parties c. Decide to ISSUE or NOT TO ISSUE a wage order Wage orders issued may not be disturbed for 12 mos from effective date; this serves as a bar for petitions for wage hikes as well
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5. Wage distortion involves four elements: a. Existing hierarchy of positions with corresponding salary rates; b. A significant change in the salary rate of a lower pay class without a concomitant increase in the salary rate of a higher one; c. The elimination of the distinction between the two levels; and d. The existence of the distortion in the same region of the country. (Prubankers Assn. v. Prudential Bank and Co., 1999) 6. How to Resolve a. Organized Establishment (with bargaining representative) i. Employer and the union shall negotiate to correct the distortions. ii. Disputes shall be resolved through the grievance procedure. iii. If still unresolved, voluntary arbitration. b. Unorganized Establishment i. ERs and Employees shall endeavor to correct such distortions. ii. Disputes shall be settled through the National Conciliation and Mediation Board. iii. If still unresolved after 10 calendar days of conciliation, it shall be referred to the appropriate branch of the National Labor Relations Commission (NLRC). compulsory arbitration c. Both the employer and employee cannot use economic weapons. i. Employer cannot declare a lockout; Employee cannot declare a strike because the law has provided for a procedure for settling ii. The salary or wage differential does not need to be maintained. (National Federation of Labor v. NLRC, 1994) F. SPECIAL CASES 1. Piece Worker: Lambo v. NLRC (1999) All workers paid by result, including those who are paid on piecework, takay, pakiao, 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 8 hrs.
In the absence of wage rates based on time and motion studies determined by the labor secretary or submitted by the employer to the labor secretary for his approval, Pulp and Paper, Inc. v. NLRC (1997) Wage rates of piece-rate workers must be based on the applicable daily minimum wage determined by the Regional Tripartite Wages and Productivity Commission. The term wage is broadly defined in Art. 97 of the Labor Code as remuneration or earnings, capable of being expressed in terms of money whether fixed or ascertained on a time, task, piece or commission basis. 2. All recognized learnership and apprenticeship agreements shall be considered automatically modified insofar as their wage clauses are concerned to reflect the prescribed wage rates. 3. Monthly-paid Employees paid by the month, shall be presumed to be paid for all the days in the month whether worked or not. The monthly minimum wage shall not be less than the statutory minimum wage multiplied by 365 days divided by 12. G. SUMMARY OF EFFECTS ON WAGES
Night shift differential on a normal day (10pm-6am) Overtime on normal day Work on any regular holiday, not exceeding 8 hours Work on any regular holiday which falls on the scheduled rest day, not exceeding 8 hours Overtime on a regular holiday Overtime on a regular holiday which falls on the scheduled rest day 110% (Additional 10% of the regular daily wage) 125% (At least an additional 25% of regular daily wage) per hour 200% of regular daily wage 230% (Additional 30% of 200% of regular daily wage) 230% (Additional 30% of the 200% of regular daily wage) per hour 260% (Additional 30% of the 230% of regular daily wage) per hour
LABOR STANDARDS
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III.PAYMENT OF WAGES
A. FORM OF PAYMENT 1. Allowed: a. Legal Tender (Art. 102) b. Check or Money Order: allowable in any of the following circumstances: i. when customary on the date of the effectivity of this Code, ii. necessary because of special circumstances as specified in appropriate regulations: a) there is a bank or other encashment facility within a 1 km radius from workplace; b) Employer or his agents does not receive any direct or indirect pecuniary benefit; c) Employes are given reasonable time during banking hours to withdraw, compensable if such time is during working hours; and d) With written consent iii. as stipulated in a CBA. c. Full Payment: Lopez Sugar Corp. vs. Franco (2005) The law does not consider as valid any agreement whereby a worker agrees to receive less compensation than what he is entitled to recover. A deed of release or quitclaim cannot bar an employee from demanding benefits to which he is legally entitled. (G&M (Phil.), Inc. vs. Batomalaque, 2005): The fact of partial payment does not shift the burden of proof to the employee because partial payment does not extinguish the obligation. d. Payroll Payment: every employer is required to pay his employees by means of payroll. The payroll should show the employee's rate of pay, deductions made, and the amount actually paid to the employees. 2. Not Allowed: a. promissory notes, b. vouchers, c. coupons, d. tokens, e. tickets, f. chits, g. any object other than legal tender ; or h. payment in kind in tuna liver and intestines (Congson v. NLRC, 1959)
B. TIME OF PAYMENT 1. General Rule: Wages paid at least a. once every 2 weeks or b. twice a month at intervals not exceeding 16 days. (Art. 103) 2. Exception: a. Force majeure or circumstances beyond the employer's control: employer may pay immediately after such force majeure or circumstances have ceased. Employer must still pay at least once a month. (Art. 103) b. Payment of wages of employees engaged to perform a task which cannot be completed in 2 weeks; In the absence of a CBA or arbitration award, the payment shall be subject to the following conditions: i. Payments are made at intervals not exceeding 16 days, in proportion to the amount of work completed; ii. Final settlement is made upon completion of work completed. (Art. 103) C. PLACE OF PAYMENT 1. General Rule: at or near the place of undertaking (Art. 104) 2. Exception: a. Impossible due to deterioration of peace and order conditions or impending emergencies caused by fire, flood or other calamity; b. ER provides for free transportation to the Employees back and forth; and c. Other analogous circumstances; provided the time spent in collecting wages is considered as compensable hours worked. (Art. 103 and Book III Rule VIII Sec 4 of IRR) 3. Exception to the exception: place of payment cannot be a bar, night or day club, drinking establishment, massage clinic, dance hall or other similar places or betting places except in the case of employees of these places. 4. Requisites for the Payment of Salaries through Banks: a. written permission of the majority of the Employees/workers concerned; b. twenty-five (25) or more employees; and
LABOR STANDARDS
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establishment located within 1 km radius of a commercial, savings or rural bank. (RA 6727 Sec 7) 5. Requisites for the Payment of Salaries through Automated Teller Machine (ATM): a. written consent of Employees b. reasonable time to withdraw, which time shall be considered as compensable hours worked; c. Employees still receive their wages within the period or frequency and in the amount prescribed under the Labor Code, as amended; d. Bank or ATM facility within a radius of 1 km from workplace; e. Upon request of the concerned employees, the employer shall issue a record of payment of wages, benefits and deductions for particular period; f. No additional expenses and no diminution of benefits and privileges as a result of the ATM system of payment; and g. The employer shall assume responsibility in case the wage protection provisions of law and regulations are not complied with under the arrangement. (Labor Advisory on the Payment of Salaries through ATM) D. DIRECT PAYMENT (ART. 105) 1. General Rule: Wages shall be paid directly to the workers to whom they are due. 2. Exceptions: a. Payment through another person: i. force majeure rendering direct payment impossible; such 3rd party must be under written authority given by the employee for the purpose; ii. payment to a family member of employee, with written authority by employee for the purpose. iii. authorized under existing law: a) insurance premium of employee, b) union dues, where the right to check-off has been recognized by employer. 3. Check-off Manila Trading and Supply Co. v. Manila Trading Labor Association (1953): Employer may be compelled to "check-off" union dues from the wages of his employee when it has
c.
been authorized to do so by the employee. This is upon the theory that it is necessary to promote the welfare and integrity of the union to which he belongs. It is a forward step to promote social justice as envisaged by our Constitution. a. authorized in writing by the Employee concerned (covers everything) b. Worker has died: payment to the heirs of the deceased; i. No need for intestate proceedings. ii. Claimants to execute an affidavit attesting to their relationship to the deceased and the fact that they are his heirs. (Art. 105); iii. Present the affidavit to the employer who now pays through the DOLE Secretary or his representative. E. CONTRACTOR (ART. 106) SUBCONTRACTOR
LABOR STANDARDS
Art. 106 1) When the contractor or subcontractor fails to pay the wages of his employees in accordance with this Code, 2) the employer shall be jointly and severally liable with his contractor or subcontractor to such employees 3) to the extent of the work performed under the contract, as if the employees are directly employed by him. F. PROHIBITION REGARDING WAGES 1. Non-interference in Disposal of Wages Art. 112 1) No employer shall limit or otherwise interfere with the freedom of any employee to dispose of his wages. 2) He shall not in any manner force, compel, or oblige his employees 3) to purchase merchandise, commodities or other property from any other person, or otherwise make use of any store or services of such employer or any other person. 2. No Wage Deductions (Art. 113) a. General Rule: No employer, in his own behalf or in behalf of any
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person, shall make any deduction from the wages of his employees. b. Exceptions: i. Employee 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; ii. 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 iii. In cases where the employer is authorized by law or regulations issued by the Secretary of Labor and Employment, such as: a) Employee debt to employer is due and demandable (CC 1706); b) Attachment or execution in cases of debts incurred for necessities: food, shelter, clothing, medical attendance (CC 1708); c) Withholding tax; d) Deductions of a legally established cooperative; e) Payment to 3rd parties upon written authority by employee; f) Deductions for loss or damage; g) SSS, Medicare, Pag-IBIG premiums. It shall be unlawful to make any deduction from the wages of any Employee for the benefit of the Employer as consideration of a promise of employment or retention in employment. (Art. 117) d. or to retaliate against the Employee who filed a complaint. (Art. 118) e. Art. 222 of the Labor Code requires an individual written authorization as a prerequisite to wage deductions. c. Radio Communication of the Phil., Inc. v. Sec. of Labor (1989): 1) Prohibition seeks to protect the employee 2) Against unwarranted practices that would diminish his compensation without his knowledge and consent. 3. No Deposits a. General Rule: no deposits from which deductions shall be made for the reimbursement of loss of or damage to tools, materials, or
equipment supplied by the employer b. Exception: i. Recognized industry practice or ii. when such is necessary or desirable as determined by the DOLE Secretary in appropriate rules and regulations. (Art. 114) c. Deductions from the deposits of an Employee for the actual amount of the loss or damage can be made provided that the: d. EE has been heard thereon, i. his responsibility has been clearly shown, (Art. 115) ii. fair and reasonable deduction which should not exceed 20% of the Employees weekly wages. e. Five J Taxi vs. NLRC (1994): i. The article providing the rule on deposits for loss or damage to tools, materials or equipment supplied by the employer does not apply to or permit deposits to defray any deficiency which the taxi driver may incur in the remittance of his "boundary." ii. When employee stops working for employer, the alleged purpose for the unauthorized deposits no longer exists. iii. Any balance due must be returned to employee with legal interest. 4. No Withholding of Wages and kickbacks prohibited (Art. 116) a. It shall be unlawful for any person, directly or indirectly, b. to withhold any amount from the wages of a worker or c. 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. 5. No False Reporting (Art. 119) a. All employment records of the employees of an employer shall be kept and maintained in or about the premises of the workplace b. main or branch office or establishment, if any, depending upon where the employees are regularly assigned. c. The keeping of the employee's records in another place is prohibited. (IRR Book II Rule X Sec. 11)
LABOR STANDARDS
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IV. OTHER FORMS OF REMUNERATION

A. B. C. D. E. Service Charges 13th Month Pay Bonus Productivity Incentives Contractor Subcontractor F. Prohibition Regarding Wages
Government Employees.
except
managerial
LABOR STANDARDS
3. Service charges collected during the period of his preventive suspension forms part of his earnings. Maranaw Hotels, etc. v. NLRC (1999): 1) Employee entitled not only to full backwages but also to other benefits, 2) including a just share in the service charges, 3) to be computed from the start of his preventive suspension until his reinstatement. B. THIRTEENTH MONTH PAY (Revised Guidelines on the Implementation of the 13th Month Pay Law and PD 851) 1. Rationale a. to further protect the level of real wages from the ravage of world-wide inflation; b. There has been no increase in the legal minimum wage rates since 1970; c. The Christmas season is an opportune time for society to show its concern for the plight of the working masses so they may properly celebrate Christmas and New Year. 2. Coverage a. General Rule: ALL EMPLOYERS are hereby required to pay all their rank and file employees a 13th month pay not later than Dec 24 of every year, b. Provided that they have worked for at least one (1) month during a calendar year. c. Exempted Employers: i. Government, its political subdivisions, including GOCCs except those operating essentially as private subsidiaries of the Government; ii. Employers already paying their employees a 13th month pay or more in a calendar year or its equivalent at the time of this issuance; Equivalent includes: 1) Xmas bonus, mid-year bonus, cash bonuses 2) and other payments amounting to not less than 1/12 of the basic salary
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A. SERVICE CHARGES 1. Distribution

Service Charge Distribution
To the Management / Employer 15%
Equally Shared by Covered Employees 85%
a. Service charges shall be distributed and paid to the employees, b. not less than once every two weeks or twice a month at intervals not exceeding 16 days. Art. 96 1) In case the service charge is abolished, the share of the covered employees shall be considered integrated in their wages. 2) The basis of the amount to be integrated: a) shall be the average monthly share of each employee b) for the past 12 months immediately preceding the abolition or withdrawals of such charges 2. Coverage: All employees of establishments collecting service charges such as hotels, restaurants, lodging houses, night clubs, cocktail lounge, massage clinics, bars, casinos and gambling houses and similar enterprises, including those entities operating primarily as private subsidiaries of the
Chapter 6. Wages
3) but shall NOT INCLUDE cash and stock dividends, cost of living allowances and all other allowances regularly enjoyed by the employee as well a non-monetary benefits. iii. Employers of household helpers and persons in the personal service of another relation to such workers; and iv. Employers of those who are paid on purely commission, boundary or task basis and those who are paid a fixed amount for performing specific work, EXCEPT where the workers are paid on piece-rate basis in which case the employer shall grant the required 13th month pay to such workers. Workers paid on a piece rate basis: those who are paid a standard amount for every piece or unit of work produced that is more or less regularly replicated, without regard to the time spent in producing the same. 3. Amount and Date of Payment a. Minimum Amount: 1/12 of the total basic salary earned by an employee within a calendar year for the year 1987 b. BASE AMOUNT, which is the basic salary shall include: i. cost of living allowances (COLA) integrated into the basic salary of a covered employee pursuant to EO 178. ii. all remunerations or earning paid by this employer for services rendered. iii. But not the allowances and monetary benefits which are not considered or integrated as part of the regular or basic salary, such as the cash equivalent of: 1) unused vacation and sick leave credits, 2) overtime, 3) premium, 4) night differential, 5) holiday pay and, and 6) cost-of-living allowances.
Time of payment c. General Rule: paid not later than Dec 24. d. Exception: i. ER may give to his employees of the required 13th Month Pay before the opening of the regular school year and the other half on or before the 24th of December every year. ii. The frequency of payment of this monetary benefit may be the subject of agreement between the employer and the recognized CBA of the employees. 4. 13th Month Pay in Special Cases a. Paid by Results: Employees who are paid on piece work basis are, by law, entitled to the 13th Month Pay. b. Employees who are paid a fixed or guaranteed wage plus commission are entitled to 13th month pay (not purely commission); the basis for computation shall be both their fixed or guaranteed wage and commission. c. Those with Multiple Employers: Government Employees working part time in a private enterprise, including private educational institutions, as well as Employees working in two or more private firms, whether on full or part time bases, are entitled to the required 13th Month Pay from all their private Employers regardless of their total earnings from each or all their Employers. d. Private School Teachers: Private school teachers, including faculty members of universities and colleges, are entitled to the required 13th month pay, regardless of the number of months they teach or are paid within a year, if they have rendered service for at least one (1) month within a year. Overload pay is NOT included in the computation for 13th month pay; overload is not overtime as it is additional work done within the normal shift (Letran Calamba Faculty vs. NLRC, 2008) e. Resigned or Separated Employee: an Employee who has resigned or whose services were terminated at any time before the time for payment of the 13th month pay is
LABOR STANDARDS
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entitled to this monetary benefit in proportion to the length of time he worked during the year, reckoned from the time he started working during the calendar year up to the time of his resignation or termination from service. f. Wage Difference: The difference between the minimum wage and the actual salary received by the Employee cannot be deemed as his 13th month pay as such difference is not equivalent to or of the same import as the said benefit contemplated by law. (JPL Marketing Promotions vs. CA, 2005) g. Terminated Employees: the payment of the 13th month pay may be demanded by the employee upon the cessation of employer-employee relationship. (Archilles Manufacturing Corp. vs. NLRC, 1995) h. Commissions: If the commissions may be properly considered part of the basic salary, then they should be INCLUDED. If they are not an integral part of the basic salary, then they should be EXCLUDED. (Phil. Duplicators Inc. vs. NLRC, 1995) i. Substitute Payment not allowed: benefits in the form of food or free electricity, assuming they were given, were not a proper substitute for the 13th month pay required by law. Neither may year-end rewards for loyalty and service be considered in lieu of 13th month pay. (Framanlis Farms, Inc. v. MOLE, 1989) j. 14th Month Pay is not mandated: Employers already paying their employees a 13th month pay or its equivalent are not covered by this Decree. (Kamaya Port Hotel v. NLRC, 1989) C. BONUS 1. General Rule: management prerogative and non demandable; it is a gratuity or act of liberality of the giver which the recipient has no right to demand as matter of right. (Traders Royal Bank vs. NLRC, 1990) 2. The matter of giving a bonus over and above the worker's lawful salaries and allowances is entirely dependent on the financial capability of the
employer to give it. (Businessday Information Systems and Services, Inc. v. NLRC, 1993) 3. Exception Demandable Bonus: When Is It
LABOR STANDARDS
a. When part of the salary or wage Luzon Stevedoring Corporation vs. CIR (1965): 1) Bonus becomes demandable when it is made a part of the wage or salary or compensation. 2) In such a case the latter would be a fixed amount and the former would be a contingent one dependent upon the realization of profits. 3) If there be none, there would be no bonus. b. When there is a contractual agreement promising to pay such Marcos v. NLRC (1995): 1) If one enters into a contract of employment under an agreement that he shall be paid a certain salary by the week or some other stated period and, 2) in addition, a bonus, in case he serves for a specified length of time, 3) there is no reason for refusing to enforce the promise to pay the bonus, if the employee has served during the stipulated time, 4) on the ground that it was a promise of a mere gratuity. c. When it is established company practice Electric Co. v. Quisumbing
Manila (1999):
1) A bonus may be considered demandable based on equitable considerations as when the giving of such bonus has been the company's long and regular practice. 2) To be considered a "regular practice," the giving of the bonus should have been done over a long period of time, and must be shown to have been consistent and deliberate.
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Chapter 6. Wages
D. PRODUCTIVITY INCENTIVES (PRODUCTIVITY INCENTIVES ACT OF 1990 - RA 6971) 1. Rationale a. encourage productivity, b. maintain industrial peace and harmony and promote responsibility in the relations between workers and employers, recognize the right of labor to its just share in the fruits of production and the right of business enterprises to reasonable returns of investments and to expansion and growth, and c. provide corresponding incentives to both labor and capital for undertaking voluntary programs to ensure greater sharing by the workers in the fruits of their labor. 2. Coverage: All business enterprises - industrial, agricultural, or agro-industrial establishments engaged in the production manufacturing, processing, repacking, or assembly of goods, including service-oriented enterprises, duly certified as such by appropriate government agencies. 3. Nature a. As the name suggests, a productivity incentive is a kind of bonus which comes from productivity gain. b. Productivity Incentives Program: i. a formal agreement established by the labor-management committee, ii. containing a process that will promote gainful employment, iii. improve working conditions and result in increased productivity, including cost savings, iv. whereby the Employees are granted salary bonuses proportionate to increases in current productivity over the average for the preceding three (3) consecutive years. v. The agreement shall be ratified by at least a majority of the employees who have rendered at least six (6) months of continuous service. c. Labor-management Committee: a negotiating body in a business enterprise composed of the
representatives of labor and management created to establish a productivity incentives program, and to settle disputes arising therefrom. d. Unsettled disputes shall be submitted for voluntary arbitration.
LABOR STANDARDS
V. WAGE RECOVERY, LIABILITIES, AND WORKER PREFERENCE

A. WORKER PREFERENCE IN CASE OF EMPLOYERS BANKRUPTCY 1. Statutory Provisions: a. Art. 110 Labor Code: In the event of bankruptcy or liquidation of an employer's business, his workers shall enjoy first preference as regards their wages and other monetary claims, any provision of law to the contrary notwithstanding. Such unpaid wages and monetary claims shall be paid in full before the claims of the Government and other creditors may be paid. (As amended by R. A. 6715) b. Art. 1707 Civil Code: The laborer's wages shall be a lien on the goods manufactured or the work done. c. Art. 2241 (6), Civil Code: With reference to specific movable property of the debtor, the following claims or liens shall be preferred: 6. Claims for laborers' wages, on the goods manufactured or the work done; d. Art. 2242 (3), Civil Code: With reference to specific immovable property and real rights of the debtor, the following claims, mortgages and liens shall be preferred, and shall constitute an encumbrance on the immovable or real right: (3)Claims of laborers, masons, mechanics and other workmen, as well as of architects, engineers and contractors, engaged in the construction, reconstruction or repair of buildings, canals or other works, upon said buildings, canals or other works e. Art. 2244 (2), Civil Code: With reference to other property, real and personal, of the debtor, the following claims or credits shall be preferred in the order named:
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Chapter 6. Wages
(2)Credits for services rendered the insolvent by employees, laborers, or household helpers for one year preceding the commencement of the proceedings in insolvency. 2. Jurisprudence: a. Summary i. It only creates a preference and not a lien so; ii. Worker preference shall apply only to ordinary preferred credits. (meaning unencumbered property) iii. It must yield to special preferred credits where liens are attached; iv. Covers unpaid wages as well as other monetary claims; and v. Judicial declaration of insolvency/bankruptcy and filing of claims by workers still required. b. Republic vs. Peralta (1987): Article 110 of the Labor Code did not sweep away the overriding preference accorded under the scheme of the Civil Code: Tax claims of the government or any subdivision thereof which constitute a lien upon properties of the Insolvent still preferred over wages. The use of the phrase "first preference" in Article 110 indicates that what Article 110 intended to modify is the order of preference found in Art. 2244, which pertains to unencumbered property. Art. 2241 and 2242 pertain to encumbered property and such property shall still remain reserved to its respective lienholder. Exception is if either 2241 (6) or 2242 (3) applies. Primary effect: it moves wages from 2nd priority in 2244 to 1st priority; as if 2244 (2) became 2244 (1). c. Development Bank of the Philippines vs. NLRC (1995): Art. 110 of the Labor Code cannot be viewed in isolation but must be read in relation to the Civil Code scheme on classification and preference of credits. Requirements of judicial liquidation / declaration of bankruptcy still intact; workers must also file their claims.
A preference applies only to claims which do not attach to specific properties. A lien creates a charge on a particular property. The right of first preference as regards unpaid wages recognized by Art. 110 does not constitute a lien on the property of the insolvent debtor in favor of workers. It is but a preference of credit in their favor, a preference in application.
LABOR STANDARDS
d. Rubberworld (Phils.), Inc. vs. NLRC (1999): Preference does not apply when the Employer corporation is under rehabilitation / receivership. B. ATTORNEY'S FEES (ART. 111) 1. In cases of unlawful withholding of wages, the culpable party may be assessed attorney's fees equivalent to 10% of the amount of wages recovered. 2. It shall be unlawful for any person to demand or accept, in any judicial or administrative proceedings for the recovery of the wages, attorneys fees, which exceed 10% of the amount of wages recovered.
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Chapter 7. Working Conditions for Special Groups

I. II. III. IV. V. Women Workers Minors Househelpers Homeworkers Handicapped Workers
C. PROHIBITED ACTS 1. Night Work a. General Rule Labor Code, Art 130: No woman should work during the following periods:
Line of Work Industrial Commercial Agricultural Prohibited Hours 10 pm to 6 am (8 hours) 12 mn to 6 am (6 hours) At nighttime unless she is given a rest period of NOT less than 9 hours (Art. 130)
LABOR STANDARDS
I. Women Workers (asked in the '87 '89

'95 '97 '98 '99 '00 '03 '05 '06 '07 Bar)
A. B. C. D. E. F. G. H. Women Under the Constitution Coverage Prohibited Acts Facilities Family Planning Services Classification of Certain Women Workers Maternity Leave Sexual Harassment
A. WOMEN UNDER THE CONSTITUTION

Art. II, Sec. 14 of the 1987 Constitution The State recognizes the role of women in nation-building, and shall ensure the fundamental equality before the law of women and men. Art. XIII, Sec. 3, par. 1 of the 1987 Constitution 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. Art. XIII, Sec. 14 of the 1987 Constitution The State shall protect working women by providing safe and healthful working conditions, taking into account their maternal functions, and such facilities and opportunities that will enhance their welfare and enable them to realize their full potential in the service of the nation.
B. COVERAGE OF STATUTES 1. General Rule:

IRR Book III Rule XII Sec. 1: This rule shall apply to all employers, whether operating for profit or NOT, including educational, religious and charitable institutions
2. Exception:
IRR Book III Rule XII Sec. 1: except to a. the Government and its subdivisions including GOCCs and to mployers of household helpers and persons in their personal service insofar as such workers are concerned.
b. Exceptions Art 131: The prohibitions prescribed by the preceding Article shall not apply in any of the following cases: 1. EMERGENCY - actual or impending emergencies caused by serious accident, fire, flood, typhoon, earthquake, epidemic or other disasters or calamity, to prevent loss of life or property or in cases of force majeure or imminent danger to public safety; 2. AVOID SERIOUS BUSINESS LOSS In case of urgent work to be performed on machineries, equipment or installation, to avoid serious loss which the employer would otherwise suffer; 3. PERISHABLE - Where the work is necessary to prevent serious loss of perishable goods; 4. MANAGERIAL, TECHNICAL, HEALTH OR WELFARE - Where the woman EE holds a responsible position of managerial or technical nature, or where the woman EE has been engaged to provide health and welfare services; 5. SKILL AND DEXTERITY OF A WOMAN - Where the nature of the work requires the manual skill and dexterity of woman worker and the same cannot be performed with equal efficiency by male worker; 6. FAMILY BUSINESS - Where the women EEs are immediate members of the family operating the establishment or undertaking; and 7. Under other analogous cases exempted by the Secretary of Labor and Employment in appropriate regulations.
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2. Discrimination a. Policy
Art. 135, par. 1: It shall be unlawful for any employer to discriminate against any woman employee with respect to terms and conditions of employment solely on account of her sex.
b. What Counts Discrimination:
as
Acts
of
Art 135, par 2: The following are acts of discrimination: a. Payment of a lesser compensation, including wage, salary or other form of remuneration and fringe benefits, to a female employees as against a male employee, for work of equal value; and b. Favoring a male employee over a female employee with respect to promotion, training opportunities, study and scholarship grants solely on account of their sexes.
Duncan Association of Detailmen vs. Glaxo Wellcome (2004): The Court sustained the validity of employer policy prohibiting an employee from having a personal or marital relationship with an employee of a competitor. The prohibition was reasonable under the circumstances because relationships of such nature might compromise the interests of the company
LABOR STANDARDS
4. Other Prohibited Acts a. Discharge to Prevent Enjoyment of Benefits

Art 137 (a) : It shall be unlawful for any employer: 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.
c. Penalty Art. 135, par. 3: Criminal liability under Art. 288 and 289; aggrieved employees may also file for money claims. Art. 288: fine of P1,000 to P10,000 imprisonment of 3 mos to 3 years or both
b. Discharge on Account of Pregnancy

Art. 137: It shall be unlawful for any employer: 2. to discharge such woman on account of her pregnancy, while on leave or in confinement due to her pregnancy; or 3. to discharge or refuse the admission of such woman upon returning to her work for fear that she may again be pregnant.
3. Stipulation against Marriage a. General Rule Art. 136: It shall be unlawful for any employer to: require as a condition of employment or continued employment that a woman employee shall NOT get married, or to stipulate expressly or tacitly that upon getting married a woman employee shall be deemed resigned or separated or to actually dismiss, discharge, discriminate or otherwise prejudice a woman employee merely by reason of her marriage. b. Bona fide occupational qualification exception: Star Paper Corp. vs. Simbol (2006): When the employer can prove that the reasonable demands of the business require a distinction based on marital status and there is no better available or acceptable policy which would better accomplish the business purpose, an ER may discriminate against an EE based in the identity of the EEs spouse.
c.
Discharge on Account of Testimony:
Book III, Rule XII, Sec 13(d): It shall be unlawful for any employer: to discharge any woman or child or any other employee for having filed a complaint or having testified or being about to testify under the Code
D. FACILITIES
Art. 132: 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.
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E. FAMILY PLANNING SERVICES

SEE: Labor Code, Art. 134 IRR Book III, Rule XII, Sec. 11, par. 1 : Employers who habitually employ more than 200 workers in any locality shall provide free familyplanning services to their EEs and their spouses which shall include but NOT limited to the application or use of contraceptives
F. CLASSIFICATION WOMEN WORKERS
OF
CERTAIN
Art. 138: Any woman who is permitted or suffered to work with or without compensation in any night club, cocktail lounge, massage clinic, bar or similar establishment, under the effective control or supervision of the employer for a substantial period of time as determined by the Secretary of Labor and Employment, shall be considered as an EE of such establishments for purposes of labor and social legislation.
G. MATERNITY LEAVE
NOTE: SEE Sec. 14-A of RA 1161 (Social Security Law) as amended by RA 7322 and RA 8282
3. Other Conditions a. Employer shall advance the payment subject to reimbursement by the SSS within 30 days from filing of leave application. b. Availment shall be a bar to the recovery of sickness benefits provided by this Act for the same period for which daily maternity benefits have been received. c. Employee may only avail of benefit for the first four (4) deliveries or miscarriages. d. Sanction: That if an employee should give birth or suffer miscarriage i. without the required contributions having been remitted for her by her ER to the SSS, or ii. without the latter having been previously notified by the ER of time of the pregnancy, then The employer shall pay to the SSS damages equivalent to the benefits which said employee member would otherwise have been entitled to. H. SEXUAL HARASSMENT
NOTE: SEE RA 7877: Harassment Act of 1995 Anti-Sexual
LABOR STANDARDS
1. Requisites: a. Employment: A female employee employed at the time of delivery, miscarriage or abortion Every woman in the private sector, whether married or unmarried, is entitled to the maternity leave benefits. b. Contribution who has paid at least 3 monthly contributions in the 12-month period immediately preceding the semester of her childbirth, or miscarriage. c. Notice: employee notified employer of her pregnancy and the probable date of her childbirth, which notice shall be transmitted to the SSS in accordance with the rules and regulations it may provide. 2. Benefit received: a daily maternity benefit equivalent to 100% of her average daily salary credit for: a. 60 days for normal delivery b. 78 days for caesarean delivery This benefit shall NOT be included in the computation of 13th month pay as it is granted to an employee in lieu of wages which is the basis for computing 13th month.
1. Unlawful Forms The law declared as unlawful all forms of sexual harassment in the: a. employment, b. education or c. training environment 2. Persons who may be liable: a. any employer, employee, manager, supervisor, agent of the employer, teacher, instructor, professor, coach, trainor or any other person, regardless of whether the demand, request for requirement for submission is accepted by the object of said act. having authority, influence or moral ascendancy over another in a work or training or education environment, who demands, requests or otherwise requires any sexual favor from another, b. Any person who directs or induces another to commit any act of sexual harassment as herein defined,
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c.
Or who cooperates in the commission by another without which it would NOT have been committed, shall also be held liable under this Act.
3. Sexual Harrassment In a work-related or employment environment: a. The sexual favor is made as a condition in the hiring or in the employment, re-employment or continued employment of said individual or in granting said individual favorable compensation, terms, conditions, promotions, or privileges, or in the refusal to grant the sexual favor results in limiting, segregating or classifying the EE which in any way would discriminate, deprive or diminish employment opportunities or otherwise adversely affect said employee; b. The above acts would either: impair the employees rights or privileges under existing labor laws; or result in an intimidating, hostile, or offensive environment for the employee. 4. Sexual Harassment in an Education or Training Environment a. Against one who is under the care, custody or supervision of the offender b. Against one whose education, training, apprenticeship or tutorship is entrusted to the offender; c. When the sexual favor is made a condition to the giving of a passing grade, or the granting of honors and scholarships, or the payment of a stipend, allowance or other benefits, privileges, or considerations; or d. When the sexual advances result in an intimidating, hostile or offensive environment for the result, trainee or apprentice. 5. Role of the employer or Head of Office a. The Employer or Head of Office shall have the duty : to prevent the commission of such acts and
to lay down the procedure for the resolution, settlement or prosecution of committed acts. b. He shall be solidarily liable for damages: if he is informed of such acts by the offended party and no immediate action is taken thereon. 6. Independent Action for Damages: The victim of work, education or training-related sexual harassment can institute a separate and independent action for damages and other affirmative relief. 7. Sanctions a. Penalties in a criminal action; prescription of such action is in 3 years. imprisonment of 1 month to mos. fine of P10k to P20k or both b. Prescription of such action is in 3 years. c. Sexual Harassment may be a valid and just cause for termination Libres v. NLRC (1999): As a managerial employee, petitioner is bound by more exacting work ethics. When such moral perversity is perpetuated against his subordinate, he provides a justifiable ground for his dismissal for lack of trust and confidence. It is the right, nay the duty of every employer to protect its employeess from oversexed superiors. Phil. Aelous Automotive United Corp. v. NLRC (2000): Cortezs plant manager manifested a special liking for her, so much so that she was receiving special treatment from him who would oftentimes invite her "for a date," which she would as often refuse. On many occasions, he would make sexual advances - touching her hands, putting his arms around her shoulders, running his fingers on her arms and telling her she looked beautiful. The special treatment and sexual advances continued during her employment for four (4) years but eventually, he made her understand that if she would not give in to his sexual advances he would cause her termination from the service; and he made good his
LABOR STANDARDS
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threat when he started harassing her. Public respondent appears baffled why it took private respondent more than four years to expose William Chua's alleged sexual harassment. The gravamen of the offense in sexual harassment is not the violation of the employee's sexuality but the abuse of power by the employer. Any employee, male or female, may rightfully cry "foul" provided the claim is well substantiated. Strictly speaking, there is no time period within which he or she is expected to complain through the proper channels. The time to do so may vary depending upon the needs, circumstances, and more importantly, the emotional threshold of the employee. Not many women, are made of the stuff that can endure the agony and trauma of a public, even corporate, scandal. If petitioner corporation had not issued the third memorandum that terminated the services of private respondent, we could only speculate how much longer she would keep her silence. Perhaps, to private respondent's mind, for as long as she could outwit her employer's ploys she would continue on her job and consider them as mere occupational hazards.
B. MINIMUM EMPLOYABLE AGE 1. General Rule

Art. 139(a) of the Labor Codeand Sec. 12 of RA 7610 as amended by RA 7658 and RA 9231: No child below fifteen (15) years of age shall be employed
LABOR STANDARDS
2. Exceptions Sec. 12, RA 7610 as amended

a. Child works directly under the sole responsibility of his parents or legal guardian and where only members of the ERs family are employed, provided: 1) his employment does NOT endanger his life, safety, health and morals, nor impairs his normal development, and 2) further provided that the parent or legal guardian shall provide the said minor child with the prescribed primary and/or secondary education b. Childs employment or participation in public entertainment or information through cinema, theater, radio or television is essential, provided that: 1) the employment contract is concluded by the childs parents or guardian, with the express agreement of the child concerned, if possible, and approved by DOLE 2) Furthermore, the following requirements in all instances are strictly complied with: i. The employer shall ensure the protection, health, safety and morals of the child ii. The employer shall institute measures to prevent the childs exploitation or discrimination taking into account the system and level of remuneration, and the duration and arrangement of working time iii. 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. 3) 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
II. MINORS
(asked in the '88 '02 '04 '06 '07 Bar)
A. B. C. D. E. Constitutional Basis Minimum Employable Age Prohibition of Certain Kinds of Work Employment of Children from 15 to 18 Hours of Work of a Working Child
A. CONSTITUTIONAL BASIS
Art II, Sec. 13 of the 1987 Constitution 1) The State recognizes the vital role of the youth in nation-building and shall promote and protect their physical, moral, spiritual, intellectual, and social well-being. It shall inculcate in the youth patriotism and nationalism, and encourage their involvement in public and civic affairs.
2)
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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.
C. PROHIBITION OF CERTAIN KINDS OF WORK 1. Prohibited Advertisements

Sec.14. No child shall be employed as a model in any advertisement directly or indirectly promoting alcoholic beverage, intoxicating drinks, tobacco and its byproducts, gambling or any for of violence or pornography."
hazardous working conditions, elements, substances, co-agents or processes involving ionizing, radiation, fire, flammable substances, noxious components and the like, or to extreme temperatures, noise levels, or vibrations; or "g) Is performed under particularly difficult conditions: or "h) Exposes the child to biological agents such as bacteria, fungi, viruses, protozoans, nematodes and other parasites; or "i) Involves the manufacture or handling of explosives and other pyrotechnic products."
LABOR STANDARDS
D. EMPLOYMENT OF CHILDREN AGED 15 TO 18 1. When Allowed

IRR Book III Rule XII Sec. 3: Any person of either sex, between 15 and 18 years of age, may be employed in non-hazardous work. No Employer shall discriminate against such person in regard to terms and conditions of employment on account of his age. For purposes of this rule, a non-hazardous work or undertaking shall mean any work or activity in which the employee is not exposed to any risk which constitutes an imminent danger to his safety and health. The Secretary of Labor shall from time to time publish a list of hazardous work and activities in which persons 18 years of age and below cannot be employed.
2. Worst Forms of Child Labor

Sec. 12-D. 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 "b) Exposes the child to physical, emotional or sexual abuse, or is found to be highly stressful psychologically or may prejudice morals; or "c) Is performed underground, underwater or at dangerous heights; or "d) Involves the use of dangerous machinery, equipment and tools such as power-driven or explosive poweractuated tools; 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 "f) Is performed in an unhealthy environment exposing the child to
2. Hazardous Activities
NOTE: IRR Book IV Rule 1 Sec. 8 has been subsequently modified by Department Order No. 4 1999 and Department Order No. 65, 2004. Please refer to said Department Orders for the updated listing of Hazardous activities.
E. HOURS OF WORK OF A WORKING CHILD 1. Quantity

Age Bracket Below 15 years old 15 to below 18 years old Daily Max 4 hours 8 hours Weekly Max 20 hours 40 hours
2. Night Work Prohibition

Age Bracket Below 15 years old 15 to below 18 years old Prohibited Hours 8 pm to 6 am (10 hrs) 10 pm to 6 am (8 hrs)
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III.HOUSEHELPERS (asked in the '87 '98

'00 '07 Bar) A. DEFINITION
Art. 141: This Chapter shall apply to all persons rendering services in households for compensation. "Domestic or household services" shall mean service in the ER's 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 ER's household, including services of family drivers.
Apex Mining Co. v. NLRC (1991): The term `househelper' is synonymous to the term `domestic servant' and shall refer to any person, whether male or female, who renders services in and about the ER's home and which services are usually necessary or desirable for the maintenance and enjoyment thereof, and ministers exclusively to the personal comfort and enjoyment of the ER's family. A househelper or a laundry woman, as well as a gardener, driver, or a houseboy who work in the staffhouse of a company are NOT househelpers. The criterion is not the nature of the work but the personal comfort and enjoyment of the family of the employer in the home of said employer.
B. CONDITIONS OF EMPLOYMENT AND OTHER RIGHTS OF THE HOUSEHELPER 1. Labor Code Art. 143 and 144; Civil Code Art. 1689: Minimum wage rates shall be equivalent to the basic cash wages plus lodging, food and medical attendance. 2. Labor CodeArt. 145: Right against assignment to non-household work at a wage rate lower than that mandated for agricultural or non-agricultural enterprises depending on the case. 3. Labor Code Art. 146 and Civil Code Art. 1691: Opportunity for education if househelper is below 18 years a. ER shall provide for at least elementary education; b. cost shall be part of the EEs compensation UNLESS otherwise agreed upon. 4. Labor Code Art. 147 and Civil Code Art. 1694: Right to just and humane
treatment (Art. 147 as well as Art. 1694 CC) 5. Labor Code Art. 148 and Civil Code Art. 1690: Board, lodging and medical attendance shall be furnished by employer 6. Labor Code Art. 149: Indemnity for unjust termination of service 7. Labor Code Art. 142 and Civil Code Art. 1692 Contract for Domestic Service shall NOT exceed 2 years but renewable annually 8. Art. 1695 Civil Code: Hours Worked House helpers shall NOT be required to work more than ten hours a day. 9. Civil Code, Art. 1695: Shall be allowed 4 paid vacation days per month 10. Civil Code, Art. 1696 Civil Code: Funeral Expenses: In case of death of the house helper: a. the head of the family shall bear the funeral expenses b. if the house helper has no relatives in the place where the head of the family lives, with sufficient means. 11. Security of Tenure - Civil Code Art. 1697 and Labor Code Art. 150: Termination prior to contract expiry must be for just cause, if the duration of the household service is NOT determined either by stipulation or by the nature of the service, the ER or the househelper may give notice to put an end to the relationship five days before the intended termination of the service. 12. Employment certification - Art. 151: ER shall give the househelper a written statement of the nature and duration of the service and his or her efficiency and conduct as househelper upon severance.
LABOR STANDARDS
IV. HOMEWORKERS (asked in the '88

and '00 Bar)
A. Coverage B. Payment for Homework C. Prohibitions for Homework
A. COVERAGE: 1. Homeworker - IRR Book III Sec. 1 as superseded by applies to any person who industrial homework for an contractor, or sub-contractor. Rule XIV D.O. 5: performs employer,
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IRR Book III Rule XIV Sec. 2(a) as superseded by D.O. 5)- Industrial homework: 1) Pertains to a system of production under which work for an ER or contractor is carried out by a homeworker at his/her home. Materials may or may not be furnished by the ER or contractor.
2)
2. Employer Definition IRR Book III Rule XIV Sec. 2(d) as superseded by D.O. 5: The employer means any person who a. Acts as a contractor delivers or causes to be delivered any goods, articles, or materials to be processed or fabricated in or about a home and thereafter to be returned or to be disposed of or distributed in accordance with ERs direction; or b. Sells any goods, articles, or materials for the purpose of having such goods or articles processed in or about a home and then repurchases them. B. PAYMENT FOR HOMEWORK 1. IRR Book III Rule XIV Sec. 6 as superseded by D.O. 5: Immediately upon receipt of the finished goods or, articles, the employer shall pay the homeworker or the contractor or subcontractor, as the case may be, for the work performed less corresponding homeworkers' share of SSS, MEDICARE and ECC premium contributions which shall be remitted by the contractor / subcontractor or ER to the SSS with the ERs share. 2. The ER may require the homeworker to redo once the work which has been improperly executed without having to pay the stipulated rate again. 3. IRR Book III Rule XIV Sec. 9 as superseded by D.O. 5): An ER, contractor, or subcontractor need NOT pay the homeworker for any work which has been done on goods and articles which have been returned for reasons attributable to the fault of the homeworker. 4. Book III Rule XIV Sec. 8 as superseded by D.O. 5: Deduction a deduction against the earnings of a homeworker for the value of
materials lost, destroyed or damaged is allowable if: a. Homeworker is clearly shown to be responsible for loss or damage b. Reasonable opportunity to be heard c. Amount of deduction is fair and reasonable d. Deduction shall not exceed 20% of homeworkers weekly earnings (IRR C. PROHIBITIONS FOR HOMEWORK (IRR Book III Rule XIV Sec. 13 as superseded by D.O. 5): No homework shall be performed on the following: explosives, fireworks and articles of like character; drugs and poisons; and other articles, the processing of which requires exposure to toxic substances.
LABOR STANDARDS
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Chapter 8. Termination of Employment

I. SECURITY OF TENURE IN GENERAL A. Definition B. Nature C. Coverage D. Conflict with Management Prerogatives II. TERMINATION BY EMPLOYEE A. Termination by Employee with Just Cause B. Termination by Employee without Just Cause C. Resignation D. No Termination III. TERMINATION BY EMPLOYER A. Just Causes (Substantive Due Process) 1. Serious misconduct 2. Willful disobedience 3. Gross or habitual neglect of duties 4. Fraud or willful breach of trust 5. Commission of a crime or offense 6. Analogous Causes 7. Constructive Discharge/Dismissal 8. Preventive Suspension B. Authorized Causes (Substantive Due Process) 6. Installation of labor saving devices 7. Redundancy 8. Retrenchment to prevent losses 9. Closing or cessation of operation 10. Disease C. Procedural Due Process 9. General Concepts 10. Consequences of Non-Compliance 11. Right to Counsel 12. Notice 13. Hearing 14. Burden of Proof 15. Degree of Proof 16. Prescription Period D. Consequences and Remedies in Illegal Dismissal 8. Reinstatement 9. Backwages 10. Separation Pay 11. Financial Assistance 12. Damages and Other Indemnity 13. Liability of Corporate Officers E. Guidelines on Imposition of Dismissal and Other Penalties
is notified of his/her actual dismissal for Cause. (Fujitsu v. CA, 2005) 3. ER may NOT substitute the required prior notice & opportunity to be heard with the mere payment of 30 days' salary. (PNB v. Cabanag, 2005) 4. Art. 279: in case of regular employment, the Employer shall not terminate the services of an Employee except for a. just cause (Art. 282) b. authorized cause (Art. 283-284) B. Nature 1. It is a constitutionally protected right (Art. XIII Sec. 3, 1987 Constitution); it cannot be blotted out by an employment contract. 2. Contractual terms must not be contrary to law, especially since employment contracts are imbued with public interest. (PNB vs. Cabansag, 2005) 3. It does not give the Employee an absolute right to his employment since an Employee may be dismissed for cause (see definition) 4. It does not give the Employee an absolute right to his position; when a transfer is not unreasonable, nor inconvenient, nor prejudicial to an employee; and it does not involve a demotion in rank or diminution of his pay, benefits, and other privileges, the employee may not complain that it amounts to constructive dismissal. (Lanzadares vs. Amethyst Security, 2003) 5. A finding of illegal dismissal entitles the Employee to: a. reinstatement without loss of seniority rights and privileges, and b. full backwages inclusive of allowances or their monetary equivalent from the time withheld up to actual reinstatement (Art. 279) 6. Separation pay in lieu of reinstatement: Doctrine of Strained Relations: If reinstatement is not feasible, expedient or practical, as where there is strained relations between the parties, particularly where the illegally dismissed employee held a managerial or key position. (Quijano vs. Mercury Drug Corp., 1998); C. Coverage 1. 1987 Constitution: all workers (Art. XIII Sec. 3) 2. Labor Code: regular employees (Art. 279) in all establishments or undertakings, whether for profit or not
LABOR STANDARDS
I. SECURITY GENERAL
OF
TENURE
IN
A. Definition: right not be removed from ones job without valid cause and valid procedure. (Kiamco v. NLRC, 1999) 1. Substantive Due Process - Dismissal for any of the just or authorized causes under Arts. 282 284. 2. Procedural Due Process - Employee must be given notice with adequate opportunity to be heard before he/she
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3. 4.
5.
6. 7.
8.
9.
(Art. 278), except government and its political subdivisions including government owned or controlled corporations or GOCCs (IRR Book VI Rule I Sec. 1) Security of tenure extends to non regular Employees (Kiamco vs. NLRC, 1999) Contract Employees limited extent; secure during the period their respective contracts of employment remain in effect. (Labajo vs. Alejandro, 1988) Probationary Employees limited extent; additional limitations on power of Employer to terminate: a. must be exercised in accordance with the specific requirements of the contract; b. dissatisfaction of the Employer must be real and in good faith, not feigned so as to circumvent the contract or the law; c. no unlawful discrimination in the dismissal (Lopez vs. Javier, 1996) Project/seasonal Employees limited extent; secure for the duration of the limited period of their employment Managerial Employees may be dismissed upon loss of confidence; entitled to security of tenure (Maglutac vs. NLRC, 1990). An employee cannot be arbitrarily dismissed at any time, and without cause as reasonably established in an appropriate investigation. (Inter Orient Maritime Enterprises, Inc. vs. NLRC, 1994) Fixed-period Employees / Term Employment: this arrangement does NOT circumvent Security of Tenure when: a. knowingly and voluntarily agreed upon by the parties without any force, duress, or improper pressure or any other circumstances vitiating his consent; OR b. the eemployer and the employee dealt with each other on more or less equal terms with no moral dominance exercised by the former or the latter. Brent Doctrine (Brent School v. Zamora, 1990; Romares v. NLRC, 1998; Medenilla v. Phil. Veterans Bank, 2000) c. If a contract is for a fixed term and the Employee is dismissed without just cause, he is entitled to the payment of his salaries corresponding to the unexpired
portion of the employment contract. (Medenilla v. Phil. Veterans Bank, 2000 D. Conflict with Management Prerogatives (asked in the 93 98 05 08 BAR) 1. Management prerogatives a. Management (San Miguel vs. Ople, 1989) b. To Discipline (San Miguel vs. NLRC, 1989) Makati Haberdashery, Inc. v. NLRC, 1989 Right to dismiss or otherwise impose disciplinary sanctions upon an employee for just and valid cause, pertains in the first place to the employer, as well as the authority to determine the existence of said cause in accordance with the norms of due process. c. To Demote (Petrophil vs. NLRC, 1986) d. To Dismiss it is a measure of self protection (Reyes vs. Ministry of Labor, 1989) Manila Trading and Supply Co., Inc. vs. Zulueta (1940): 1) Subject to regulation by the State basically in the exercise of its paramount police power. 2) Employer cannot legally be compelled to continue with the employment of a person who admittedly was guilty of misfeasance or malfeasance towards his employer, and whose continuance in the service of the latter is patently inimical to his interests. 3) The law, in protecting the rights of the laborer, authorizes neither oppression nor self-destruction of the employer. e. To abolish departments or positions (San Miguel vs. NLRC, 1999) f. To transfer (Yuco vs Ministry of Labor, 1990) Lazanderas v. Amethyst Security and General Services (2003); Castillo v. NLRC (1999); Westin Phil. Plaza Hotel v. NLRC (1999): 1) The Employer has the right to transfer or assign Employees from one area of operation to another, or one office to another or in pursuit of its legitimate business interest, 2) provided there is no demotion in rank or diminution of salary, benefits
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LABOR STANDARDS
and other privileges and not motivated by discrimination or made in bad faith, or effected as a form of punishment or demotion without sufficient cause. 3) This matter is a prerogative inherent in the Employer's right to effectively control and manage the enterprise. 2. Requisites for the Validity of Management Prerogative Affecting Security of Tenure: a. Exercised in good faith for the advancement of the Employer's interest, and b. NOT for the purpose of defeating or circumventing the rights of the Employees under special laws or under valid agreements (San Miguel vs. Ople, 1989)
II. TERMINATION
BY
EMPLOYEE
(asked in the 96 99 BAR)

A. Termination by Employee with Just Cause B. Termination by Employee without Just Cause C. Resignation D. No Termination
A. Termination by Employee with Just Cause no written notice to Employer required; the following are just causes: SICA 1. Serious insult by the Employer or his representative on the honor and person of the Employee; 2. Inhuman and unbearable treatment accorded the Employee by the Employer or his representative; 3. Commission of a crime or offense by the Employer or his representative against the person of the Employee or any of the immediate family members of his family; and 4. Other causes analogous to any of the foregoing. (Art 285 (b)) B. Termination by Employee without Just Cause 1. EE to serve written notice on Employer at least 1 month in advance. (Art 285(a)) 2. Effect of failure to serve notice: Employer may hold Employee liable for damages. (Art 285(a)) C. Resignation (asked in the 99 BAR) 1. Definition: the voluntary act of an Employee who finds himself in a
situation where he believes that personal reasons cannot be sacrificed in favor of the exigency of the service and he has no other choice but to dissociate himself from his employment. (Habana vs. NLRC, 1998) 2. Requisites of Resignation a. Unconditional (Azcor Manufacturing, Inc. vs. NLRC, 1999) b. Intention to relinquish a portion of the term of office accompanied by an act of relinquishment.(Azcor Manufacturing, Inc. vs. NLRC, 1999); No valid resignation where it was made without proper discernment (Metro Transit Organization, Inc. vs. NLRC, 1998) c. Voluntary (Pascua vs. NLRC, 1998) d. Acceptance of Employer necessary to make the resignation effective. (Shie Jie Corp./Seastar Exim Corp. vs. National Federation of Labor, 2005; Reyes v. CA, 2003) 3. Resignations once accepted and being the sole act of the employee, may not be withdrawn without the consent of the employer. (Intertrod Maritime, Inc. v. NLRC, 1991) 4. Rule: Filing of an illegal dismissal case is inconsistent with resignation. (Valdez v. NLRC, 98) 5. Except when the filing of an illegal dismissal case by respondent was evidently a mere afterthought: it was filed not because Employee wanted to return to work but to claim separation pay and back wages. (Willi Hahn Enterprises vs. Maghuyop, 2004) 6. Constructive Dismissal The following constitute constructive dismissal: a. bona fide suspension of the operation of a business or undertaking exceeding 6 mos. (Valdez v. NLRC, 1998) b. floating status more than 6 mos. (Agro Commercial Security Services vs. NLRC, 1989) Phil. Wireless, Inc. v. NLRC (1998): 1) An involuntary resignation resorted to when continued employment is rendered impossible, unreasonable, or unlikely; 2) when there is a demotion in rank and/or a diminution in pay; or 3) when a clear discrimination, insensibility or disdain by an employer becomes unbearable to the employee. c. If the employee was forced to remain without work or assignment for a
LABOR STANDARDS
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period exceeding six months, then he is in effect constructively dismissed. (Valdez v. NLRC, 1998) D. No Termination Circumstances that shall NOT terminate employment: 1. Bona fide suspension of the operation of a business or undertaking NOT exceeding 6 months; OR 2. Fulfillment by the Employee of a military or civic duty. (Art 286) a. Employer shall reinstate the Employee to his former position without loss of seniority rights if Employee indicates his desire to resume to work not later than 1 month from the resumption of operations of his Employer or from relief from the military or civic duty. (Art 286) b. Employer-Employee relationship deemed SUSPENDED in case of suspension of operation, unless suspension is for the purpose of defeating the rights of the Employees, or mandatory fulfillment of military or civic duty. (Bk VI, Rule I, Sec 12, Omnibus Rules)
III. TERMINATION BY EMPLOYER

A. Just Causes (Substantive Due Process) B. Authorized Causes (Substantive Due Process) C. Procedural Due Process D. Consequences and Remedies in Illegal Dismissal
Pehid, 2005; Lakpue Drug, Inc. vs. Belga, 2005) ii. Shows that the Employee has become unfit to continue working for the Employer. (Philippine Aeolus Automotive United Corp. vs. NLRC, 2000; Coca-Cola Bottlers, Phil., Inc. v. Kapisanan ng Malayang Manggagawa sa Coca- Cola, 2005) 2. Willful disobedience (WiDi) a. Requisites: (Westin Phil. Plaza Hotel v. NLRC, 1999; Micro Sales Operation Network v. NLRC, 2005) i. EE's assailed conduct must have been willful, that is, characterized by a wrongful and perverse attitude; AND ii. The order violated must have been: 1) Reasonable; 2) Lawful; 3) sufficiently known to the Employee; and 4) pertain to the duties which he had been engaged to discharge. b. Not every case of willful disobedience may be penalized by dismissal; the penalty must be proportionate. (Bascon v. CA, 2004) 3. Gross and habitual neglect of duties (asked in the 93 94 00 08 BAR) a. Definition: Gross negligence is 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. (Tres Reyes v. Maxim's Tea House, 2003; Cebu Filveneer Corp. v. NLRC, 1998; Citibank v. Gatchalian, 1995) b. Habitual neglect implies repeated failure to perform one's duties for a period of time, depending upon the circumstances. (Chua v. NLRC, 2005) c. Requisites: neglect of duty must be BOTH gross and habitual 4. Fraud or willful breach of trust (asked in the89 90 91 93 94 95 99 00 01 BAR) a. Requisites of Loss of Confidence
LABOR STANDARDS
A. JUST CAUSES (SUBSTANTIVE DUE PROCESS) (Art 282) 1. Serious misconduct (SeMi) (asked in the 88 89 90 93 94 95 96 00 03 08 BAR) a. Misconduct is improper or wrong conduct; it is the transgression of some established and definite rule of action, a forbidden act, a dereliction of duty, willful in character, and implies wrongful intent and not mere error in judgment. (Dept of Labor Manual, Sec. 4343.01) b. Requisites: i. Serious; to be serious, misconduct must be: a) of such grave and aggravated character b) in connection with the employee's work. (Austria vs. NLRC, 1999; Samson vs. NLRC, 2000; Villamor Golf Club vs.
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i.
Committed against the Employer or his representative; ii. willful since fraud implies wrongful intent; iii. EE concerned holds a position of trust and confidence; and (Mabeza vs. NLRC, 1997) Panday v. NLRC (1992): EE is entrusted with confidence on delicate matters, such as care and protection, handling or custody of the employer's property. iv. Act complained of must be work-related i.e. it must show the employee concerned to be unfit to continue working for the employer. b. Additional Guidelines i. NOT simulated; ii. NOT used as a subterfuge for causes which are improper, illegal or unjustified; iii. NOT arbitrarily asserted in the face of overwhelming evidence to the contrary; iv. genuine, NOT a mere afterthought to justify earlier action taken in bad faith; (Vitarich v. NLRC, 1999; CocaCola Bottlers, Phils., Inc. v. Kapisanan ng Malayang Manggagawa sa Coca-Cola, 2005) c. Proof beyond reasonable doubt NOT necessary; substantial evidence: Reyes vs. Minister of Labor (1989): 1) It is sufficient that employer has reasonable ground to believe that the employee concerned is responsible for the purported misconduct, 2) and the nature of his participation therein renders him unworthy of the trust and confidence demanded of his position.
d. Loss of Confidence: Managerial/ confidential vs Rank-and-file Employees

Managerial/confidential Substantial evidence reasonable ground to believe Employees guilt; mere existence of a basis for the belief (Etcuban vs. Sulpicio Lines, 2005) Employment for a long time is counted against the Employee (Salvador v. Phil. Mining Service Corp., 2003) General rule: trust and confidence is restricted to MANAGERIAL Employees (Fujitsu Computer Products Corp. v. CA, 2005) Rank-and-file Proof of involvement in the alleged events in question required; mere uncorroborated assertions and accusations are not enough (Etcuban vs. Sulpicio Lines, 2005)
LABOR STANDARDS
Except: when rankand-file position is reposed with trust and confidence (Coca-Cola vs. NLRC, 1989) e.g. care and custody of property
e. The lack of material or pecuniary damages would NOT in any way mitigate a person's liability nor obliterate the loss of trust and confidence. (Cadiz v. CA, 2005) 5. Commission of a crime or offense against the person of the Employer or any immediate member of his family or duly authorized representative (asked in the 90 93 94 00 BAR) a. Conviction or prosecution is not required (Starlite Plastic vs. NLRC, 1989) b. Dismissal of the criminal case against an Employee shall NOT necessarily be a bar to his dismissal from employment on the ground of loss of trust and confidence. (Ramos v. NLRC, 1998); or under this ground as well. c. The private respondent's conviction of the crime of theft of property belonging to the petitioner has affirmed the existence of a valid ground for her dismissal and thus removed the justification for the administrative decision ordering her reinstatement with back wages. (Sampaguita Garments Corp. v. NLRC, 1994) 6. Analogous Causes (asked in the 89 93 94 95 96 00 BAR) must be due to a voluntary and/or willful act or omission
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by Employee (Nadura vs. Benguet Consolidated, 1962) The guilt or innocence in a criminal case is NOT determinative of the existence of a just or authorized cause for dismissal. (Chua v. NLRC, 1993)
B. SUBSTANTIVE DUE PROCESS AUTHORIZED CAUSES (ART. 283) Recognition of Right
LABOR STANDARDS
7. Constructive Discharge/Dismissal a. Definition: A quitting because continued employment is rendered impossible, unreasonable or unlikely; as, an offer involving a demotion in rank and a diminution in pay. (Mobile Protective and Detective Agency v. Ompad, 2005; PhilippineJapan Active carbon Corp. v. NLRC, 1989) b. There is constructive dismissal when there is a demotion in rank and/or diminution in pay, or when a clear discrimination, insensibility or disdain by an employer becomes unbearable to the employee. (Dusit Hotel Nikko v. National Union in Hotel, Restaurant and Allied Industries, 2005) c. Constructive dismissal is present when an employee's functions, which were originally supervisory in nature were reduced, and such reduction is not grounded on valid grounds such as genuine business necessity. (Go v. CA, 2004) d. In Mark Roche International v. NLRC (1999), there was illegal dismissal but no constructive dismissal. It did not involve a demotion in rank or diminution in pay. Employees were simply told, without prior warning or notice, that there was no more work for them. 8. Preventive Suspension a. Definition: it is a disciplinary measure for the protection of the company's property pending investigation of any alleged malfeasance or misfeasance committed by the employee. The employer may place the worker concerned under preventive suspension if his continued employment poses a serious and imminent threat to the life or property of the employer or of his co-workers. (PAL v. NLRC, 1998) b. Preventive Suspension is limited to 30 days; any more than that amounts to constructive dismissal. (Pido vs. NLRC, 2007)
Uichico v, NLRC (1997): a. The law recognizes the right of every business entity to reduce its workforce if the same is made necessary by compelling economic factors which would endanger its existence or stability. b. The fundamental law itself guarantees, even during the process of tilting the scales of social justice towards workers and employees, the right of enterprises to reasonable returns of investment and to expansion and growth. c. To hold otherwise would not only be oppressive and inhuman, but also counterproductive and ultimately subversive of the nation's thrust towards resurgence in our economy which would ultimately benefit the majority of our people.
Procedure: At least 1 month before the intended date of termination, Employer is to serve written notice to: Affected Employees, and DOLE (Art 283) Art. 283 and 284 are not exhaustive; other authorized causes are: a. total and permanent disability, b. disease incurable in 6 mos, c. valid application of union security clause, d. expiry of term employment period, e. completion of project, f. failure in probation, etc In computing separation pay, a fraction of at least six (6) months shall be considered as one (1) year. (Art. 283) Authorized Causes:
1. Installation of labor saving devices (asked in the 94 00 BAR) Entitlement: Employee is entitled to separation pay of 1 month pay or 1 month pay per year of service whichever is higher. 2. Redundancy (asked in the 89 94 99 00 01 BAR) a. Entitlement: Employee is entitled to separation pay of 1 month pay or 1 month pay per year of service, whichever is higher. b. Definition: Wiltshire File Co., Inc. v. NLRC (1991): 1) It exists where the services of an employee are in excess of what is reasonably demanded by the actual requirements of the enterprise.
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2) A position is redundant where it is superfluous, 3) and superfluity of a position or positions may be the outcome of a number of factors, such as over hiring of workers, decreased volume of business, or dropping of a particular product line or service activity previously manufactured or undertaken by the enterprise. c. Requisites: Written notice served on both the Employees and the DOLE at least 1 month prior to the intended date; Payment of separation pay equivalent to one month pay or one month pay for every year of service, whichever is higher; Good faith in abolishing the redundant positions; and Fair and reasonable criteria in ascertaining what positions are to be declared redundant and accordingly abolished. (Asian Alcohol Corp. v. NLRC, 1999), such as but not limited to: Panlilio v. NLRC (1997); Golden Thread Knitting Industries, Inc. v. NLRC (1999): 1) preferred status; (e.g. temporary, casual or regular Employees) 2) efficiency; or 3) seniority. d. Other concepts In redundancy, the following are considered: 1) the position itself; 2) the nature of the services performed by the employee; and 3) the necessity of such position. (Tierra International Construction Corp. v. NLRC, 1992; Edge Apparel, Inc. v. NLRC, 1998) Redundancy does NOT refer to duplication of work. That no other person was holding the same position which the dismissed employee held prior to the termination of his services does not show that his position had not become redundant. (Escareal v. NLRC, 1992) Creation of positions with functions related or similar to those of the abolished functions does not necessarily invalidate the declaration of redundancy. the old and new positions were different
and the declaration was not maliciously motivated. (Santos vs. CA, 2001) ERs good faith in implementing a redundancy program is not necessarily put in doubt by the availment of services of an independent contractor. (Asian Alcohol Corp vs. NLRC, 1999) Financial Loss is NOT a requisite. (Escareal v. NLRC, 1992)
LABOR STANDARDS
3. Retrenchment to prevent losses (asked in the 94 98 00 01 03 BAR) a. Entitlement: Employee is entitled to separation pay of 1 month pay or 1/2 month pay per year of service whichever is higher b. Definition:
FF Marine Corp., v. NLRC (2005): 1) Retrenchment is the termination of employment initiated by the employer 2) through no fault of the employees and without prejudice to the latter, 3) resorted to by management during a) periods of business recession; b) industrial depression, or c) seasonal fluctuations or d) lulls occasioned by lack of orders, e) shortage of materials, f) conversion of the plant for a new production program, or g) the introduction of new methods or more efficient machinery, or of automation.
c. Basic Requisites: N N S G F Necessary to prevent or minimize losses and such losses are proven;
Lopez Sugar Corp. v. Federation of Free Workers (1990): Financial statements audited by independent external auditors constitute the normal method of proof of the profit and loss performance of a company. Bogo-Medellin Sugar Cane Planters Assn., Inc. v. NLRC (1998): A financial statement for 2 corporate years is insufficient proof of serious business losses.
There must be one (1) month written notice to o DOLE and the o Employees; Separation pay is paid; Exercise is in good faith meaning the prerogative was exercised for the advancement of Employers interest and not to defeat or circumvent Employees right to security of tenure; and
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Fair and reasonable criteria in ascertaining who will be affected. Normally used are preferred status, (e.g. temporary, casual or regular Employees) efficiency, physical fitness, age, financial hardship, or seniority.
d. General Standards: (S I N S) for when retrenchment is preventive rather than curative Losses expected are substantial and not merely de minimis in extent; Apprehended losses are reasonably imminent, can be perceived objectively and in good faith; Retrenchment must be reasonably necessary to prevent the expected losses measure of last resort; and Expected or actual losses must be proved by sufficient and convincing evidence. (Lopez Sugar Corp. vs. Federation of Free Workers, 1990) e. Other concepts Re-hiring or reemployment does NOT negate the imminent losses which prompted the Employer to retrench. (Atlantic Gulf and Pacific Co. of Manila v. NLRC, 1999) Still, reorganization cannot be used as a convenient device to get rid of existing personnel in order to replace them with new ones. (Gregorio Araneta Univ. vs. NLRC, 1987) Reduction of work days may be considered constructive retrenchment (International Hardware vs. NLRC, 1989) Temporary retrenchment or temporary cessation or suspension of operations: (Art 286) (asked in the 87 94 99 00 BAR)
International Hardware vs. NLRC (1989): A specific period that employees may remain temporarily laid-off or in floating status. The temporary lay-off or bona fide suspension of operation of a business or undertaking wherein the employees likewise cease to work should also not last longer than six (6) months. After 6 months, the employees should either be recalled to work or permanently retrenched following the requirements of the law, and that failing to comply with this would be tantamount to dismissing the employees and the employer would thus be liable for such dismissal.
4. Closure or cessation of operations (asked in the 90 94 99 00 01 06 BAR) a. Entitlement: Employee is entitled to separation pay of one (1) month pay, or 1/2 month pay per year of service whichever is higher. b. Employer may close or cease his business operations or undertaking even if he is not suffering from serious business losses or financial reverses, as long as he pays his employees their termination pay in the amount corresponding to their length of service. (Catatista v. NLRC, 1995) c. Must be bona fide or in good faith. d. It includes both the complete cessation of all business operations and the cessation of only part of a companys business. (Coca-Cola Bottlers Inc. vs. NLRC, 1991) e. Requirements: 1 month written notice to DOLE and Employee plus payment of separation pay f. Separation Pay: Employee is entitled to separation pay except when: a) Closure is due to serious business losses; or (North Davao Mining Corp. vs. NLRC, 1996) b) Closure is due to an act of government. (National Federation of Labor vs. NLRC, 2000) g. Special Case of Business Transfers
Sale in faith good Purchaser, unless he contractually commits to absorb Employees of seller, has no legal obligation to retain Employees. Seller is obliged to pay separation pay and other benefits. EEs may be given but are not entitled to employment preference. Sale of business is considered to be a closure and not a mere cessation of operations. (San Felipe Neri School of Mandaluyong vs. NLRC, 1991) Absorbing corporation must retain Employees and recognize the length of their service. (Filipinas Port Services vs. NLRC, 1991) Same as in merger
LABOR STANDARDS
Merger
Consolidation
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5. Disease (asked in the 88 94 00 04 BAR) a. Entitlement: Employee is entitled to separation pay of one (1) month pay, or 1/2 month pay per year of service whichever is higher. b. Requisites: a) Employee has been found to be suffering from any disease; b) His continued employment is prohibited by law or is prejudicial to his health as well as as to the health of his co-employees; (Art. 284) c) Payment of separation pay; d) A medical certification by a competent public health authority that the disease cannot be cured within six (6) months even with proper medical treatment. (IRR Book VI Rule I Sec. 8) Medical certificate cannot be dispensed with (Manly Express Inc. vs. Payong, 2005). It must be issued by a competent public health authority and NOT the company physician (Cebu Royal Plant vs. Deputy Minister of Labor, 1987)
JUST CAUSES Serious Misconduct REQUISITES 1. 2. Willful Disobedience 1. 2.
AUTHORIZED CAUSES COMPARED

Retrenchment Redundancy Closure
Reduction of personnel usually due to poor financial returns so as to cut down on costs of operations in terms of salaries and wages
The service of an Employee is in excess of what is required by an enterprise
The reversal of the fortune of the employer whereby there is a complete cessation of business operations and/or actual locking-up of the doors of the establishment, usually due to financial losses Aims to prevent further financial drain upon the Employer
LABOR STANDARDS
Resorted primarily avoid minimize business losses
to to or
Serious a. Grave and aggravated character, b. In connection with work; and Shows that Employee is unfit to work for Employer. Willful conduct wrongful and perverse attitude; and Order violated must be: a. Reasonable, b. Lawful, c. Sufficiently known to Employee, d. In connection to the duties.
Gross and Habitual Neglect Fraud or Willful Breach of Trust
Neglect must be both gross and habitual. Loss of Confidence 1. Committed against the Employer or his representative (direct); 2. willful since fraud implies wrongful intent; 3. EE concerned holds a position of trust and confidence (Mabeza vs. NLRC, 1997); 4. Act complained of must be work-related. Additional Guidelines 1. NOT simulated; 2. NOT used as a subterfuge; 3. NOT arbitrarily asserted; and 4. genuine, NOT a mere afterthought (Vitarich v. NLRC, 1999; Coca-Cola Bottlers, Phils., Inc. v. Kapisanan ng Malayang Manggagawa sa CocaCola, 2005)
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JUST CAUSES Commission of a crime or offense against Employer
REQUISITES 1. Crime against the a. Employer, b. Immediate member of employers family, or c. Employers duly authorized representative; and Conviction or prosecution NOT required.
LABOR STANDARDS
2. Analogous Causes
Due to a voluntary and/or willful act or omission by Employee (Nadura vs. Benguet Consolidated, 1962)
AUTHORIZED CAUSES Installation of Saving Devices Redundancy Labor
REQUISITES 1 month written notice to DOLE and Employee separation pay equivalent to one month pay or one month pay for every year of service, whichever is higher 1. 1 month written notice to DOLE and Employee 2. separation pay equivalent to one month pay or one month pay for every year of service, whichever is higher; 3. Good faith in abolishing the redundant positions; and 4. Fair and reasonable criteria in choosing those affected (Asian Alcohol Corp. v. NLRC, 1999), such as but not limited to: a) preferred status (e.g. temporary, casual or regular Employees) b) efficiency, or c) seniority. (Panlilio v. NLRC, 1997; Golden Thread Knitting Industries, Inc. v. NLRC, 1999) Basic Requisites: N N S G F 1. Necessary to prevent or minimize losses and such losses are proven 2. 1 month written notice to DOLE and the Employees 3. Separation pay equivalent to at least one month pay or at least 1/2 month pay for every year of service, whichever is higher; 4. Exercise is in good faith; and 5. Fair and reasonable criteria in ascertaining who will be affected a. preferred status (e.g. temporary, casual or regular Employees) b. efficiency, c. physical fitness, d. age, e. financial hardship, or f. seniority. (Asian Alcohol Corp. v. NLRC, 1999) 1. 2. General Standards: S I N S for when retrenchment is preventive rather than curative 1. Losses expected are substantial and not merely de minimis in extent; 2. Apprehended losses are reasonably imminent; 3. Retrenchment must be reasonably necessary to prevent the expected losses; and 4. Expected or actual losses must be proved by sufficient and convincing evidence. (Lopez Sugar Corp. vs. Federation of Free Workers, 1990) 1. Must be done in good faith (bona fide) 2. 1 month written notice to DOLE and Employee 3. Separation pay equivalent to one month pay or 1/2 month pay for every year of service, whichever is higher. 1. Employee is suffering from any disease; 2. His continued employment is prohibited by law or is prejudicial to his health as well as as to the health of his co-employees. (Art. 284) 3. Separation pay equivalent to at least one month pay or at least 1/2 month pay for every year of service, whichever is higher; and 4. Medical certification by a competent public health authority that the disease cannot be cured within 6 mos even with proper medical treatment. (IRR Book VI Rule I Sec. 8)
Retrenchment
Closure or Cessation of Operations Disease
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CAUSE Serious Misconduct
TERMINABLE EXAMPLES Teacher pressuring colleague to change a failing grade to a passing one plus misrepresentation. (Padilla vs. NLRC, 1997) Obscene, insulting or offensive words against superior. (Asian Design and Manufacturing vs. Hon. Deputy Minister of Labor, 1986) Sleeping in post, gross insubordination, dereliction of duty, challenging a superior to a fight. (Luzon Stevedoring vs. CIR, 1965) Immorality / Immoral Conduct: conduct which is so wilful, flagrant or shameless as to show indifference to the opinion of good and respectable members of the community; such conduct must be grossly immoral so corrupt as to constitute a crime or so unprincipled as to be reprehensible to a high degree or committed under such scandalous or revolting circumstances as to shock the common decency. (Narag vs. Narag, 1998); to be a a valid cause for dismissal, the immoral act must render incapable performance of duties/services or calculated at injuring employers business. When a teacher engages in extramarital relationship, especially when the parties are both married. (Santos v. NLRC, 1998) Violation of Company Rules: Company policies and regulations, unless shown to be grossly oppressive or contrary to law, are generally valid and binding on the parties and must be complied with until finally revised or amended, unilaterally or preferably through negotiation, by competent authority. (Aparente, Sr. v. NLRC, 2000) Disobeying a Valid Order to Transfer test of validity: Not unreasonable Not inconvenient Not prejudicial No demotion in rank No diminution in salary, privileges or benefits (Blue Dairy vs. NLRC, 1999) Mere inconvenience does not necessarily invalidate a transfer order; unreasonable inconvenience makes the order invalid. (Homeowners Savings and Loan Assoc. vs. NLRC, 1996) Reasonableness pertains to the character of orders and to the manner in which they are made. (Escobin vs. NLRC, 1998) Habitual tardiness and absenteeism (Manila Electric Co. v. NLRC, 1996) Abandonment the deliberate and
NON-TERMINABLE EXAMPLES Borrowing Money: as a general rule, it is neither dishonest, nor immoral, nor illegal, much less criminal (Medical Doctors, Inc. [Makati Medical Center] v. NLRC) except it becomes a serious misconduct when reprehensible behavior such as the use of a trust relationship as a leverage for borrowing money is involved. (Pearl S. Buck Foundation, Inc. v. NLRC, 1990) Love: teacher falling in love with student without a showing that the former took advantage of her position to court her student. 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 v. Clave, 1990)
LABOR STANDARDS
Willful Disobedience
Assertion of employees right not to be made to work outside of what he had been hired to do. (Tierra International Production Corp. v. NLRC, 1996) Refusing a promotion, since promotion is in the nature of a gift or reward. (PT&TC vs. CA, 2003) Disobeying an Invalid Order to Transfer: an invalid transfer amounts to constructive dismissal; it is invalid when it fails test of validity. (refer to the adjacent column for the test)
Gross and Habitual Neglect
Simple negligence (RDS Trucking v. NLRC, 1998) or unsatisfactory performance (Oreta vs. NLRC, 1989)
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CAUSE
TERMINABLE EXAMPLES unjustified refusal of an Employee to resume his employment. (Nueva Ecija Electric Cooperative v. NLRC, 2005) 1. Requisites: failure to report to work or absence w/o valid reason 2. Clear intent to sever EmployeeER relationship via overt acts. (Labor v NLRC, 1995; Floren Hotel v. NLRC, 2005; Leonardo v. NLRC, 2000) CANNOT be lightly inferred, much less legally presumed from certain equivocal acts such as interim employment. (Hacienda Dapdap v. NLRC, 1998) Bank Employee delivered newly approved credit cards to a total stranger without verification protocol.
NON-TERMINABLE EXAMPLES Mere involvement in an accident, absent any showing of fault or recklessness on the part of the Employee, is NOT a valid ground for dismissal. (Paguio Transport Corp. v. NLRC, 1998) Filing a complaint of illegal dismissal is inconsistent with abandonment; Except when Employee prays for separation pay instead of reinstatement (Jo vs. NLRC, 2000) No Abandonment: Mere absence from work (Mendoza v. NLRC, 1999) Going home to have dinner; employees do not need to take their meals within the company premises. (PAL v. NLRC, 1999) Leaving his workplace to relieve himself (Dimabayo v. NLRC, 1999) Employee is not in a position of trust and confidence.
LABOR STANDARDS
Fraud Willful Breach Trust
or of
Commission of a crime or offense against Employer
Analogous Causes
Dishonesty: Custodian of petty cash fund reimbursed another employee for services the latter did not render. (Naguit v. NLRC, 2003) Falsification of time cards. (San Miguel vs. NLRC, 1989) Theft of company property. (Firestone Tire and Rubber Co. vs. Lariosa, 1987) Theft; the employee here was convicted after she won her case for illegal dismissal. In view of the employees conviction, the decision of the NLRC which had already become final and executory calling for her reinstatement and the payment of back wages should not now be enforced. Otherwise, she would in effect be undeservedly rewarded when she should instead be punished for her offense. (Sampaguita Garments Corp. v. NLRC, 1994) Quarrelsome Bossy: an Employee's attitude problem is a valid ground for dismissal, equivalent to loss of trust and confidence; an Employee who cannot get along with his fellow co-EEs is detrimental to the company for he can upset and restrain the working environment. (Heavylift Manila, Inc. v. CA) Conviction Moral Turpitude: Violation of a company rule prohibiting the infliction of harm or physical injury against any person under the particular circumstances provided for in the same rule may be deemed analogous to serious misconduct. (Oania v. NLRC, 1995) Gross inefficiency is closely related to gross neglect for both involve specific acts or omission on the part of the
Probable Cause: Although after preliminary investigation probable cause has been found and the accused has been detained, this is NOT legal basis for immediate termination of employment. (Standard Electric Manufacturing Corp. v. Standard Electric Union, 2005) Conviction Moral Turpitude: Conviction of a crime involving moral turpitude is not one of these justifiable causes. Not under fraud/willful breach since the crime was unrelated to the performance of the employee's function. Not under commission of crime since it was not directed at Employer or his family or
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CAUSE
TERMINABLE EXAMPLES employee resulting in damage to the employer or to his business. (Lim v. NLRC, 1996) Past Offenses: Previous offenses may be so used as valid justification for dismissal from work only if the infractions are related to the subsequent offense upon which basis the termination of employment is decreed. (Stellar Industrial Service, Inc. v. NLRC, 1996; La Carlota Planters Assn. v. NLRC, 1998) Professional Training / Residency Training: a residency or resident physician position in a medical specialty is never a permanent one. Residency connotes training and temporary status. It is the step taken by a physician right after post-graduate internship (and after hurdling the Medical Licensure Examinations) prior to his recognition as a specialist or subspecialist in a given field. right to security of tenure only to the extent that they periodically make the grade.(Felix v. Buenaseda, 1995)
NON-TERMINABLE EXAMPLES representative. Analogous causes must have an element similar to those found in the specific just cause enumerated under Article 282. Clearly lacking in the ground invoked by petitioner is its relation to his work or to his employer. (IRRI v. NLRC, 1993) In IRRI v. NLRC (1993), homicide outside IRRI (employer) complex after office hours and against a non-IRRI employee. Courtesy Resignation Resignation must be voluntary. Adding the word "courtesy" did not change the essence of resignation. That courtesy resignations were utilized in government reorganization did not give private respondent the right to use it as well in its own reorganization and rehabilitation plan. (Batongbacal vs. Associated Bank, 1988)
LABOR STANDARDS
C. PROCEDURAL DUE PROCESS (asked in the 89 90 91 92 93 94 95 97 98 99 04 06 BAR) 1. General Concepts (Agabon v. NLRC, 2004)
Procedural Requirements Basis for termination Just Cause Art. 282 Requirements 1. Notice specifying the grounds for which dismissal is sought 2. Hearing or opportunity to be heard 3. Notice of the decision to dismiss (Art. 277(b)) Notice to: 1. Employee, & 2. DOLE at least 30 days prior to the effectivity of the separation
2. Consequences of Non-Compliance a. Possibilities and Consequences

Four Possible Situations Effect Liability of Employer No liability * separation pay if for authorized cause Reinstatement + Full Backwages * if reinstatement NOT possible = separation pay Reinstatement + Full Backwages * if reinstatement NOT possible = separation pay Liable for damages due to noncompliance with procedural req'ts *separation pay if for authorized cause
Just or Dismissal Authorized valid Cause + Due Process No Just or Dismissal Authorized invalid Cause + Due Process No Just or Dismissal Authorized invalid Cause + No Due Process Just or Dismissal Authorized valid Cause + No Due Process
Authorized Cause Arts. 283 & 284
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b. History of the effects of noncompliance

Prior to 1989 Wenphil Corp. v. NLRC, 1989 - Belated Due Process Rule Illegal dismissal Dismissal is valid (NO reinstatement and backwages) But Employer to indemnify Employee for damages Dismissal is valid EE is entitled to the payment of full backwages. Computed from the time of dismissal until the Court finds the dismissal to be for just cause. Dismissal is valid (NO reinstatement and backwages) But Employer to indemnify Employee in the form of nominal damages indemnity stiffer than Wenphil Corp. vs. NLRC to discourage the practice of dismiss now, pay later.
Serrano v. NLRC, 2000
it is enough to that the parties are afforded fair and reasonable opportunity to explain their side of the controversy. (Mendoza vs. NLRC, 1991) b. Summary proceeding may be conducted; written explanations, affidavits, position papers or other pleadings may be used as well; what is essential is the ample opportunity to be heard. (Homeowners Savings and Loan Assoc. Inc. vs. NLRC, 1996) La Carlota Planters Assn., Inc. v. NLRC (1998): Ample Opportunity in due process means that kind of assistance that management must accord the Employee to enable him to prepare adequately for his defense including legal representation. c. No formal hearing necessary when the Employee already admitted his responsibility for the act he was accused of. (Magos v. NLRC, 1998) 6. Burden of Proof upon the employer. Employer must comply with due process requirements before any termination is done. (Gothong Lines, Inc. v. NLRC, 1999) Unsubstantiated suspicions and baseless conclusions by employers are not legal justification for dismissing employees. (Maranaw Hotel and Resort Corp. v. NLRC, 1999) 7. Degree of Proof substantial evidence; proof beyond reasonable doubt not required. (Manila Electric Co., Inc. v. NLRC, 1991) 8. Prescription Period an action for reinstatement by reason of illegal dismissal is one based on an injury which may be brought within 4 years from the time of dismissal. (Art. 1146 of the Civil Code) D. CONSEQUENCES AND REMEDIES IN ILLEGAL DISMISSAL If employee is unjustly dismissed, he is entitled to: Reinstatement without loss of seniority rights and other privileges, and to; and Full Backwages inclusive of allowances, and to other benefits or
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LABOR STANDARDS
Current rule: Agabon v. NLRC, 2004
3. Right to Counsel a very basic requirement of substantive due process; it has to be observed. Indeed, the rights to counsel and to due process of law are two of the fundamental rights guaranteed by the 1987 Constitution to any person under investigation, be the proceeding administrative, civil, or criminal. (Salaw v. NLRC, 1991) 4. Notice twin notice requirement for just causes and 1 month notice to DOLE and Employee for authorized causes. a. Not needed when Employee consented to the retrenchment or voluntarily applied for one. (International Hardware Inc. vs. NLRC, 1989) b. Notice must be individual, not collective. (Shoppers Gain Supermart vs. NLRC, 1996); voluntary arbitration satisfies notice requirement for authorized causes (Revidad vs. NLRC, 1995) 5. Hearing a. A formal or trial type hearing is not at all times and in all instances essential to due process;
their monetary equivalent computed from the time his compensation was withheld up to the time of actual reinstatement. (Art. 279) Offer to Reinstate: an offer by Employer to re-employ the Employee did not cure the vice of earlier arbitrary dismissal. (Ranara v. NLRC, 1992) Reinstatement and backwages are separate and distinct reliefs given to an illegally dismissed Employee. (Judy Phils., Inc. v. NLRC, 1998)
4) it would be more prudent to order payment of separation pay instead of reinstatement. Pearl S. Buck Foundation, Inc. v. NLRC (1990): 1) Where a peaceful relationship is not feasible, as the Employer appears to have lost its trust in Employee, who in turn is not seeking reinstatement, 2) it would be an act of oppression to compel them to return to the status quo ante. Sibal v. Notre Dame of Greater Manila (1990): No Strained Relations: 1) if it is not so compelling and so serious in character, 2) if it is not shown that the continued employment of an Employee is so obnoxious to the person/business of the employer and that the continuation of such employment has become inconsistent with peace & tranquility which is an ideal atmosphere in every workplace. e. Other Concepts i. Reinstatement, to which the Employee is entitled to under the law, may be granted in Employees favor although he failed to specifically pray for it in his complaint. (General Baptist Bible College v. NLRC, 1993) ii. Art. 223 is clear that an award for reinstatement shall be immediately executory even pending appeal and the posting of a bond by the employer shall not stay the execution for reinstatement. iii. Reinstatement ordered by Labor Arbiter is selfexecutory; reinstatement ordered by NLRC is not and, though immediately executory, still requires writ of execution. (Panuncillo vs. CAP Phil. Inc., 2007) 2. Backwages (asked in the 88 89 90 91 94 97 99 01 02 BAR) a. Definition: St. Theresa's School of Novaliches Foundation vs. NLRC (1998): 1) Earnings lost by a worker due to his illegal dismissal; a form of relief that
LABOR STANDARDS
Remedy: Re + FB or SePay + FB 1. Reinstatement (asked in the 88 89 90 91 92 93 95 9799 05 07 BAR) a. Definition: restoration of an employee who was unjustly dismissed to the position from which he was removed, that is, to his status quo ante dismissal (Santos vs. NLRC, 1987) b. Alternative: In lieu of reinstatement, Employee is entitled to separation pay of 1 month pay per year of service. (Gaco vs. NLRC, 1994) c. General Rule: reinstatement is a matter of right to an illegally dismissed Employee. d. Exceptions: i. Closure of Business (Retuya vs. Dumarpa, 2003) ii. Economic Business Conditions: The reinstatement remedy must always be adapted to economicbusiness conditions. (Union of Supervisors, etc. v. Sec. of Labor, 1984) iii. EEs Unsuitability (Divine World High School vs. NLRC, 1986) iv. EEs Retirement/Coverage (Espejo vs. NLRC, 1996) v. Doctrine of Strained Relations Quijano vs. Mercury Drug Corp. (1998): 1) Where reinstatement is not feasible, expedient or practical, 2) as where reinstatement would only exacerbate the tension and strained relations between the parties, 3) or where the relationship between the employer and employee has been unduly strained by reason of their irreconcilable differences, particularly where the illegally dismissed employee held a managerial or key position in the company,
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restores the income lost by reason of such unlawful dismissal. 2) It is not private compensation or damages, nor is it a redress of a private right 3) but, rather, in the nature of a command to the employer to make public reparation for illegally dismissing an employee. b. Computation i. Without deduction for their earnings elsewhere during their layoff (Bustamante vs. NLRC, 1996) ii. Awards including salary differentials are not allowed. (Insular Life Assurance Co. vs. NLRC, 1987) iii. The salary base properly used should be the basic salary rate at the time of dismissal plus the regular allowances); allowances include: a) emergency cost of living allowances (ECOLA), transportation allowances, 13th month pay; (Paramount Vinyl Product Corp. vs. NLRC, 1990) b) also included are vacation leaves, service incentive leaves and sick leaves. iv. The effects of extraordinary inflation are not to be applied without an official declaration thereof by competent authorities. (Lantion v. NLRC, 1990) c. Other Concepts Effect of Failure to Claim mere procedural lapse which cannot defeat a right granted under substantive law. (De la Cruz v. NLRC, 1998) ii. Effect of Failure to Order a plain error which may be rectified, even if Employee did not bring an appeal regarding the matter. (Auror Land, etc. v. NLRC, 1997) 3. Separation Pay (asked in the 90 91 96 97 02 06 BAR) a. Kinds: i. SP as a statutory requirement for authorized causes; ii. SP as financial assistance found in the next section; i.
iii. SP in lieu of reinstatement where reinstatement is not feasible; and iv. SP as a benefit in the CBA or company policy. b. Computation i. SP as a statutory requirement is computed by integrating the basic salary with regular allowances Employee has been receiving. (Planters Product Inc. vs. NLRC, 1989); allowances include transportation and emergency living allowances (Santos vs. NLRC, 1987) ii. Commissions may not be included since they must be earned by actual market transactions by Employee. (Soriano vs. NLRC, 1989) c. Other Concepts Anino v. NLRC (1998): 1) A dismissed employee who has accepted separation pay is not necessarily estopped from challenging the validity of his or her dismissal. 2) Neither does it relieve the employer of legal obligations. 4. Financial Assistance a. General rule: a person dismissed for cause is NOT entitled to separation pay. b. Exception: Separation pay may be allowed as a measure of social justice c. Exception to the exception: where the Employee is dismissed for serious misconduct or those causes reflecting on his moral character. (PLDT Co. v. NLRC, 1988) 5. Damages and Other Indemnity (asked in the 92 93 95 97 01 BAR) a. Moral i. awarded to compensate one for mental anguish, besmirched reputation, wounded feelings and social humiliation caused by wrongful dismissal. ii. Recoverable only when dismissal was: a) Attended by bad faith or fraud; bad faith does not pertain to negligence or bad judgment but to a state of mind dominated by ill will or motive,
LABOR STANDARDS
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b) constituted an act oppressive to labor, or c) done in a manner contrary to morals, good customs or public policy. (PAL vs. NLRC, 1999) b. Exemplary may be awarded only if the dismissal was done in a wanton, oppressive, or malevolent manner. (Permex, Inc. v. NLRC, 2000) c. Attorneys Fees i. NOT recoverable when there is no sufficient showing of bad faith; justified when claimant is compelled to litigate with 3rd persons or to incur expenses to protect his interest by reason of an unjustified act of the party against whom it is sought (Lopez vs. NLRC, 1998) ii. when an Employee was included in a criminal complaint not in his personal but official capacity, and the case arose in connection with his work as such, his Employer is obligated to defray the formers legal expenses (Salazar vs. NLRC, 1996) d. Indemnity to househelper if the household service is for a fixed term and the helper is unjustly dismissed, helper shall be paid the compensation already earned plus that for 15 days by way of indemnity. (Art. 149) 6. Liability of Corporate Officers: (asked in the 91 97 BAR) a. In cases of illegal dismissal, corporate directors and officers are solidarily liable with the corporation, where terminations of employment are done with malice or in bad faith. (Bogo-Medelin Sugarcane Planters Assn., Inc. v. NLRC, 1998) b. Corporate veil is pierced: i. When it is deliberately and maliciously designed to evade financial obligations to Employees or when used as means to perpetuate fraud or an illegal act. (Pabalan vs. NLRC, 1990) ii. Directors or trustees who willfully and knowingly assent to patently unlawful acts or who are guilty of gross negligence or bad faith in managing corporate affairs. (Sec. 31 of the Corp. Code)
Otherwise, the manager, officer or the stockholders are not liable personally since the corporation is invested by law with a separate and distinct personality. (Sunio vs. NLRC, 1984)
LABOR STANDARDS
E. GUIDELINES ON IMPOSITION OF DISMISSAL AND OTHER PENALTIES 1. Must NOT be exercised wantonly, but must be controlled by substantive due process and tempered by the fundamental policy of protection to labor enshrined in the Constitution. (Farrol v. CA, 2000) 2. The penalty must be commensurate with the act, conduct or omission imputed to the employee and imposed in connection with the employers disciplinary authority. (Farrol v. CA, 2000) 3. Policies, rules and regulations on work-related activities of the employees must always be fair and reasonable. (VH Manufacturing, Inc. V. NLRC, 2000; St. Michael's Institute v. Santos, 2001) 4. Ers 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-andfile employees. (Etcuban, Jr. V. Sulpicio Lines, Inc., 2005) 5. Substantial evidence is sufficient as basis for the imposition of any disciplinary action upon the Employee. 6. Factors a. Value of articles pilfered (Associated Labor Union v. NLRC, 1999) b. Whether employee is a managerial or confidential Employee: i. Managerial or confidential Employee: greater trust is placed by management, and greater fidelity to duty is correspondingly expected. ii. Rank-and-file Employee: generally mere wage earners whose dismissal from employment can have severe financial consequences on their families. (Associated Labor Union v. NLRC, 1999) iii. Length of service (PLDT, Inc. v. NLRC, 1999) iv. Number of violations committed during his employ.(PLDT, Inc. v. NLRC, 1999)
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Chapter 9. Social Legislation
Chapter 9. Social Legislation I. COMPARISON: SSS AND GSIS

Enabling law
LABOR STANDARDS
Definition of Terms
SSS RA 1161 as amended by RA 8282: Social Security Act of 1997 1. Employer any person, natural or juridical, domestic or foreign, who carries on in the Philippines any trade business, industry, undertaking, and uses the services of another person who is under his orders as regards the employment, except those considered as employer under the GSIS. A self-employed person shall be both employer and employee at the same time. 2. Employee any person who performs services for an employer who receives compensation for such services, where there is an Employee-ER relationship. A self-employed person shall be both employer and employee at the same time. 3. Self-employed any person whose income is not derived from employment, including, but not limited to: a. self-employed professionals; b. partners and single proprietors of businesses; c. actors, directors, scriptwriters, news correspondents not considered as employees under the above definition; d. athletes, coaches, trainers, jockeys; and e. individual farmers and fishers. 4. Dependents: a. Legal spouse entitled to receive support; b. Child unmarried, not gainfully employed, and below 21 or Child over 21 if he or she became incapacitated while still a minor; child may be legitimate, legitimated, legally adopted, or illegitimate; c. Parent who is receiving regular support. 5. Beneficiaries a. Primary i. Dependent spouse (see above); ii. Dependent children (see above); illegitimate children are entitled only to 50% of the share of legitimate children unless there are no legitimate children, in which case, they get 100%. b. Secondary shall only receive when the primary beneficiaries are absent i. Dependent parents ii. Other person designated by employee 6. Compensation all actual remuneration for employment, including living allowance, converted value of noncash remuneration, except that portion already above the max salary credit (P 15,000).
GSIS RA 8291 amending PD 1146
1. Employer National government, its political subdivisions, branches, agencies or instrumentalities, including government-owned or controlled corporations and financial institutions with original charters (GOCCs). 2. Employee any person receiving compensation while in service of an employer whether by election or appointment, irrespective of status of appointment. Note: No employed. counterpart for self-
Same except that a child here is below 18
Same except that RA 8291 does not distinguish share of legitimate and illegitimate children
Compensation basic pay received excluding per diems, bonuses, overtime, honoraria, allowances and other emoluments not integrated into the basic pay under existing laws.
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Chapter 9. Social Legislation
SSS
Compulsory
GSIS
LABOR STANDARDS
1. Employers as defined above; 2. Employees not over 60 years including household helpers with at least P1,000 monthly pay; and 3. Self-employed.
Voluntary
Coverage
1. Spouses who devote full time to managing household and family affairs; 2. OFWs recruited by foreign-based employers; 3. Employees already separated from employment or those self-employed with no realized income for a given month, who chose to continue with contributions to maintain right to full benefit. Note: Foreign governments, international organizations or their wholly owned instrumentality employing workers in the Philippines may enter into an agreement with the Philippine government to include their employees in the SSS except those already covered by their civil service retirement system.
1. Public sector employees below the compulsory retirement age of 65. 2. Exceptions: a. AFP and PNP; b. Members of the Judiciary and Constitutional Commissions who are covered only by life insurance as they have separate retirement schemes; c. Contractual employees with no employee-employer relationship with the agency they serve.
Effective Date of Coverage
Employer: 1st day of operation Employee: 1st day at work Self-employed: upon registration with SSS
1. 2. 3. 4. 5. 6. 7.
Summary of Benefits
Effects of separation from employment Dispute Settlement Prescriptive Period
8. 9. 1. 2. 3.
Monthly pension Dependents pension Retirement benefits Permanent disability benefits Death benefits Funeral benefits Loan Social Security Commission Resolution No. 669. Moreover, several SSS-issued circulars such as Circular No. 21-P and No. 52 pertain to the treatment of salary loans, sometimes providing for more flexible payment terms or condonation for delinquent payers; Santiago v. CA and SSS, GR # L-39949 (1984) resolved an issue involving the treatment of salary loan repayments; SSS website also shows loans Sickness benefits Maternity leave benefits Employers contribution, and Employees obligation to pay contribution both cease at the end of the month of separation; EE shall be credited with all contributions paid on his behalf and entitled to all benefits set forth by the law. Social Security Commission CA (Rule 43; questions of law and fact) SC (Rule 45; questions of law only) 20 years
1. 2. 3. 4. 5.
Monthly pension Retirement benefits Permanent disability benefits Funeral benefits Loan GSIS website provides for this 6. Temporary disability benefits (similar to sickness) 7. Separation benefits 8. Unemployment benefits Sec 11 9. Survivorship benefits 10.Life insurance benefits
Continued membership for the unemployed member; and entitlement to whatever benefits he has qualified to in the event of any compensable contingency. GSIS CA (Rule 43) SC (Rule 45); appeal does not stay execution. 4 years
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II. BENEFITS UNDER THE SSS

A. COMPUTATION OF PENSION 1. Monthly Pension the monthly pension shall be the highest of the following amounts: a. P300 + [20% x (ave. monthly credit)] + [2% x (ave. monthy credit) x (# of cash credited years of service in excess of 10 years)]; or b. 40% x (ave. monthly credit); or c. Notwithstanding a and b, minimum pension is P1,200 for members with at least 10 years credit service, P2,400 for those with 20 years, P1,000 for less than 10 years but not less than 60 months. 2. Dependents Pension a. Paid when member dies, retires or with permanent total disability; b. Paid to each child conceived on or prior to contingency, but not exceeding 5, beginning with the youngest and preferring the legitimate; c. Amount is either P250 or 10% of the monthly pension as computed above, whichever is higher. B. RETIREMENT 1. Eligibility requirements a. 120 monthly contributions; b. Age i. 65 years old; or ii. a member who has reached 60 years may also avail if he is already separated from employ-ment or has ceased to be self-employed. 2. Benefit entitlement to monthly pension from retirement until death. 3. Lump Sum Alternative member may opt to receive his first 18 monthly pensions in lump sum but such is discounted at a preferential rate of interest. 4. To those ineligible to the 60 year old with less than 120 monthly contributions who is no longer employed or selfemployed, and who is not continuing contributions independently, he is entitled to a lump sum equal to his total contributions paid. 5. Death of a retiree
a. His primary beneficiaries are entitled to receive the monthly pension. b. Dependents pension is separate from the monthly pension inherited by the primary beneficiaries. c. If there are no primary beneficiaries and the retiree dies within 60 months from start of pension, secondary beneficiaries are entitled to lump sum of the remaining balance of the 5 year guaranteed period.
LABOR STANDARDS
C. DEATH 1. Eligibility requirement: 36 monthly contributions prior to the semester of death. 2. Benefit monthly pension to primary or secondary beneficiaries. 3. To those ineligible lump sum benefit which shall be the higher between the two: a. (monthly pension) x 12; or b. (monthly pension) x (# of monthly contributions) D. PERMANENT DISABILITY 1. Eligibility requirement: 36 monthly contributions prior to the semester of disability; same as death benefit; only difference is that the pension is paid directly to the member. 2. In case the permanently disabled member dies, it would be given the same treatment as a retiree dying. (see section B-5 above). 3. For permanent partial disability, the pension is not lifetime. (e.g. loss of thumb entitles member to only 10 months of pension, while loss of arm 50 months). a. It shall be paid in lump sum if the period is less than 12 months. b. For multiple partial disabilities, they shall be additive when related or deteriorating the percentage shall be equal to # of months the partial disability is entitled to divided by 75 months. (e.g. loss of sight in one eye 25/75; loss of arm 50/75; if both occur due to same cause, then 25/75
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+ 50/75 = 100% so treated as if it were permanent total disability. E. FUNERAL BENEFIT P12,000 IN CASH OR KIND, UPON DEATH OF MEMBER. F. SICKNESS 1. Eligibility requirements and other conditions a. Inability to work due to sickness or injury b. Confined for at least 4 days either in a hospital or elsewhere with SSS approval; c. At least 3 months of contributions in the 12 month period immediately before the semester of sickness or injury has been paid; d. All company sick leaves with pay for the current year has been used up; e. Maximum of 120 days per 1 calendar year (so maximum permissible for the same sickness and confinement is 240 days for 2 consecutive years); f. The employer has been notified, or, if a separated, voluntary or self-employed member, the SSS directly notified within 5 days of confinement; g. Notice to employer or SSS not needed when confinement is in a hospital; notice to employer not required as well when Employee became sick or injured while working or within premises of the employer. 2. Benefit: daily cash allowance paid for the number of days a member is unable to work due to sickness or injury equivalent to 90% x (ave daily salary credit) G. MATERNITY (ALREADY DISCUSSED; pls refer to conditions of employment) H. LOAN
employer fails or refuses to remit the sss contributions.

LABOR STANDARDS
B. TO THE EMPLOYER employer is liable to the employees and must: 1. Pay to SSS damages equivalent to the benefits of those who die, become disabled, get sick or reach retirement age, except that in case of pension benefits; 2. Pay all unpaid contributions plus a penalty of 3% per month until paid; and 3. Be held criminally liable through an action commenced either by the SSS or the employee concerned. C. TO THE SELF-EMPLOYED a selfemployed person who fails to register with the sss will also be fined and/or imprisoned. However, in the event the self-employed person does not realize earnings in a given month, payment of sss contributions for that month is no longer required. D. TO THE SELF-EMPLOYED AND VOLUNTARY MEMBER a selfemployed and voluntary member who fails to remit contributions after membership is approved, may pay the monthly contribution prospectively but is not allowed to pay contributions retroactively from the month no contribution payments were remitted. E. CHANGE OF MEMBERSHIP CATEGORY: 1. Non-working spouse gets employed or becomes selfemployed: membership shall be reclassified accordingly as employed or self-employed or OFW. 2. The recipient of a lump sum permanent total disability who is re-employed or has resumed selfemployment or as an OFW or Nonworking spouse, not earlier than one year from the date of disability, shall again be subject to compulsory coverage and shall be considered a new member.
III.SSS: EFFECT OF REPORTING AND REMITTANCE CONTRIBUTIONS
NONNONOF
A. TO THE EMPLOYEE employee is still entitled to sss benefits even if the

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IV. BENEFITS UNDER THE GSIS

A. MONTHLY PENSION AMOUNT SHALL BE THE: 1. 37.5% x (revalued ave. monthly compensation) 2. Plus 2.5 x (revalued ave. monthly compensation) x (years in service in excess of 15 years). The monthly pension shall not exceed 90% of the ave. monthly compensation. It shall not be less than P2,400 for those with 20 years of service and not less than P1,300 for everyone else. B. SEPARATION BENEFITS 1. Eligibility requirements a. 60 years of age, or separation from service with at least 3 years but not over 15 years served b. Below 60 years of age, but at least 15 years of service rendered. 2. Benefit a. For 60 years of age or separated from service with 3 to 15 years of service: cash payment of 100% of ave. monthly compensation for each year of service (so essentially, the total amount of all contributions paid) or P12,000 whichever is higher. b. Below 60 years of age and at least 15 years of service: cash payment equivalent to 18 x (monthly pension) at the time of resignation or separation plus an old-age pension benefit equal to basic monthly pension. C. UNEMPLOYMENT BENEFITS (NOT PROVIDED FOR BY SSS) 1. Eligibility requirements a. Employee separated from service due to abolition of his office or position; and b. Employee has been paying integrated contributions for at least 1 year prior to separation. 2. Benefit: monthly cash payments of 50% of ave. monthly compensation for a duration which is proportional to years rendered, ranging from 2 months to 6 months. D. RETIREMENT BENEFITS 1. Eligibility requirements a. 15 years service; b. 60 years of age; and
c. Not receiving pension benefit from permanent total disability. Note: Retirement is compulsory for employees 65 years of age who have rendered at least 15 years of service; if employee has less than 15 years of service, he may be allowed to continue in accordance with civil service laws. 2. Benefit: choice between a. 60 x (basic monthly pension) lump sum payment at the time of retirement plus basic monthly pension payable monthly for life after expiry of the 5-year guaranteed period which is already covered by the lump sum; or b. Cash payment equivalent to 18 x (basic monthly pension) plus monthly pension for life immediately but with no 5-year guarantee. E. PERMANENT DISABILITY BENEFITS 1. Eligibility requirements for Permanent Total Disability a. Disability not due to employees own grave misconduct, notorious negligence, habitual intoxication, or willful intention to kill himself or another; b. Employee is: i. in service at the time of disability; or ii. even if separated, he has paid at least 36 monthly contributions within the 5-year period immediately prior to disability or has paid a total of at least 180 monthly contributions prior to disability; and c. Member is not enjoying old-age retirement benefit. 2. Benefit for Permanent Total Disability: a. Monthly income benefit for life equal to basic monthly pension This is effective from date of disability; b. If member is in service at the time of disability and he has paid at least 180 monthly contributions, in addition to the monthly income benefit, he shall receive an additional cash payment of 18 times basic monthly pension. 3. To the ineligible: If member has rendered at least 3 years of service, then he shall receive cash payment equal to 100% of ave. monthly
LABOR STANDARDS
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compensation for each year of service (essentially total amount of contributions made) or P12,000 whichever is higher. 4. Partial Disability: Paid according to GSIS prescribed schedule (this is similar to the scheme used by SSS; refer to section II subsection D-3 above); member availing of permanent partial disability must satisfy condition E.1.a. above regarding the disability not being due to his own fault and either E.1.b.i. or E.1.b.ii. regarding employment status and services rendered. F. TEMPORARY DISABILITY BENEFITS (SIMILAR TO SICKNESS UNDER SSS) 1. Eligibility requirements and other conditions: a. Employee must be i. in service at the time of disability; or ii. if separated, he has rendered at least 3 years of service and paid at least 6 monthly contributions in the 12 month period immediately prior to disability; b. All sick leave credits including CBA sick leaves for the current year has been used up; and c. Maximum of 120 days per 1 calendar year (so maximum permissible for the same sickness and confinement is 240 days for 2 consecutive years). 2. Benefit: 75% of the current daily compensation for every day or fraction thereof of disability or P70 whichever is higher. G. SURVIVORSHIP BENEFITS Beneficiaries Are Entitled To The Following: 1. Basic survivorship pension which is 50% of basic monthly pension; and 2. Dependent childrens pension not exceeding 50% of the basic monthly pension. H. DEATH BENEFITS when member dies, the primary beneficiaries are entitled to only one of the following: 3. Survivorship pension (check G.1 above) a. If he was in the service when he died; or b. Even if separated from the service, he has at least 3 years of service and has paid 36 monthly
contributions within the 5 years immediately preceding death; or c. Even if separated from the service, he has paid 180 monthly contributions prior to death. 4. Survivorship pension plus cash payment of 100% ave. monthly compensation for every year of service (so essentially, pension plus total contributions made) a. If he was in the service when he died; and b. With 3 years of service. 5. Cash payment equivalent to 100% ave. monthly compensation for each year of service he paid contributions or P12,000 whichever is higher a. With 3 years of service; and b. He has failed to qualify in the prior 2 schemes. I. 1. 2. 3. 4. FUNERAL BENEFITS fixed by GSIS rules and regulations (currently at P20,000); entitled to this are the following: Active member; Member separated from service but still entitled to funeral benefit; Pensioner; Retiree who at the time of retirement was of pensionable age but opted to retire under RA 1616.
LABOR STANDARDS
J. LIFE INSURANCE K. LOAN
V. LIMITED PORTABILITY SCHEME UNDER RA 7699

A. WHO IS COVERED? 1. Workers who transfer employment from one sector to another; and 2. Those employed in both sectors. B. WHAT HAPPENS? worker shall combine his years of creditable service and paid contributions in one sector, private or public, as represented by his contributions to either SSS or GSIS, respectively, with his service in the other sector.
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C. WHY? to be able to satisfy eligibility requirements of benefits provided for by either SSS or GSIS. D. OVERLAPPING PERIODS of membership in case of those employed in both sectors at once are to be counted once only for purposes of totalization.
VI. NATIONAL HEALTH INSURANCE ACT (RA 7875 as amended by RA 9241)

A. WHO IS COVERED? ALL CITIZENS 1. Paying: a. Both public and private sector employees; and b. The self-employed. 2. Nonpaying: a. Retirees and pensioners of either SSS or GSIS; b. Members who have reached retirement age and who at least have paid 120 monthly contributions; c. Indigent members; and d. Legal dependents. B. WHO ARE DEPENDENTS? 1. Legitimate spouse who is not a member, (same as SSS so refer to table above); 2. Children below 21 unless incapacitated (same as SSS so refer to table above; RA 9241 however also includes step children as well); and 3. Parents who are 60 years old or above whose monthly income is below an amount to be determined by Phil Health Insurance Corp (PHIC). C. BENEFITS 1. In-patient hospital care a. Room and board; b. Services of health care professionals; c. Diagnostic, laboratory, and other medical examination services; d. Use of surgical or medical equipment and facilities; e. Prescription drugs and biologicals; f. Inpatient education packages.
2. Out-patient care a. Services of health care professionals; b. Diagnostic, laboratory, and other medical examination services; c. Personal preventive services; and d. Prescription drugs and biologicals. 3. Emergency and transfer services 4. Other health care services 5. The following are not included (Sec. 11): a. Non-prescription drugs and services; b. Alcohol abuse or dependency treatment; c. Cosmetic surgery; d. Optometric services; e. Fifth and subsequent normal obstetrical deliveries; and f. Cost-ineffective procedures, which shall be defined by the PHIC. Note: This list of excluded items are subject to review and revision by the PHIC through actuarial studies every 3 years. 6. Requisites for availment (Sec. 12): a. Payment of at least 3 monthly contributions within the immediate 6 months prior to availment; and b. The following need not pay to qualify: i. SSS and GSIS pensioners prior to effectivity of RA 7875; ii. Members who have reached the age of retirement and have paid at least 120 monthly contributions; iii. Enrolled indigents.
LABOR STANDARDS
- end of Labor Standards -
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Table of Contents
LABOR RELATIONS
Chapter 1: STATE POLICY I. Methods of Dispute Settlement II. Trade Unionism III. Work Enlightenment IV. Machinery for Dispute Settlement A. National Labor Relations Commission (NLRC) B. National Conciliation and Mediation Board (NCMB) C. Bureau of Labor Relations D. Voluntary Arbitration Advisory Council (VAAC) E. Administrative Intervention for Dispute Avoidance V. Industrial Peace VI. Worker Participation in Decision and Policy Making Processes Affecting Rights, Duties, and Welfare Chapter 2: RIGHT TO SELF ORGANIZATION I. Basis of Right to Self-Organization A. 1987 Constitution B. Labor Code II. Extent and Scope of Right III. Worker Qualification IV. Covered Employees/Workers A. All Employees B. Government Corporate Employees C. Supervisory Employees D. Aliens E. Security Guards V. Excluded Employees/Workers A. Managerial Employees and Confidential Employees B. Worker/Member of Cooperative C. Employees of International Organizations D. Non-Employees VI. Party Protected VII. Non-Abridgment of Right and Sanctions for Violation of Right Chapter 3: LABOR ORGANIZATION I. Policy II. Definition of Labor Organizations and Unions A. Labor Organization 1. Union 2. Workers Association B. Legitimate Labor Organization 1. Legitimate Workers Association C. Company Union III. Union Function and Rationale IV. Government Regulation A. Union Registration: Procedure 1. Requirements and Rationale 2. Action on Application; Denial of Registration 3. Effect of Registration; Nonregistration 4. Rights of Legitimate Labor 95 95 96 96 96 96 98 98 99 101 103 Organization B. Cancellation of Union Certificate of Registration V. International Activities of Union: Prohibition and Regulation VI. Union-Member Relations A. Nature of Relationship B. Issues and Concerns 1. Admission and Discipline of Members 2. Election of Officers; Qualifications; Manner of Election; Tenure and Compensation 3. Compensation 4. Major Policy Matter 5. Union Funds: Payment of Attorneys Fees and Special Assessment 6. Mandatory Activity 7. Union Information 8. Enforcement and Remedies; Procedure and Sanctions VII. Union Affiliation: Local and Parent Union Relations A. Affiliation: Purpose and Nature of Relations 1. Independent Union/Local Union 2. Chartered Local (local/chapter) 3. Affiliate 4. National Union or Federation B. Supervisor/Rank and File Union Affiliation C. Local Union Disaffiliation/Mass Disaffiliation D. Period VIII. Union Security A. Statutory Basis and Rationale B. Validity Agreement and Effect on Freedom of Choice; Types of Union Security Provisions C. Coverage: Worker Inclusion and Exclusion D. Implementation: Obligation and Liabilities E. Financial Security: Agency Shop and Check-Off Chapter 4: THE APPROPRIATE BARGAINING UNIT I. Definition and Role of Law II. Determination of Appropriate Bargaining Unit A. Factors in Unit Determination 1. Community and Mutuality of Interests 2. History 3. Geography Location B. Unit Severance and Globe Doctrine C. Effect of Prior Agreement III. Determining Agency, Arts. 226, 232 115 116 116 117 117 117 117
117 117 118 118 119 119 119 119 119 120 120 120 120 120 120 121 121 121 121 122 122 122 123 123 123 123 123 123 123 124 125 125
LABOR RELATIONS
103 105 105 105 105 105 106 107 107 107 107 107 108 108 108 110 110 110 111 111 112 112 112 112 112 112 113 113 113 113 113 113 113 114 115
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Table of Contents
Chapter 5: UNION REPRESENTATION I. Pre-Condition: Employer-Employee Relationship II. Methods of Establishing Majority Status III. Certification Election A. Employee as initiating partyin organized and unorganized establishments B. Employer as initiating party C. Responsible agency D. Requisite for validity of election E. Nature of proceeding/ effect of private agreement F. Election process and procedure 1. Petition for Certification Election a. Who may file b. Where to file c. When to file d. Forced Intervenor e. Motion for Intervention f. Preliminary Conference; hearing g. Order 2. Certification Election Mechanics a. Posting of Notice b. Voting List and Voters c. Voting Day d. Protest e. Appeal from Certification Election f. Annulment G. Certification of designated majority union H. Bars to certification election 1. One-Year Bar Rule 2. Negotiation Bar Rule 3. Contract Bar Rule 4. Deadlock Bar Rule I. Suspension of certification election J. Effect of petition for cancellation of union registration Chapter 6: COLLECTIVE BARGAINING: CONCEPT, PROCEDURES AND ISSUES I. General Concepts A. Policy declaration B. Nature and Purpose C. Waiver II. Duty to Bargain A. Meaning of duty B. Deadlock III. Bargaining Procedure A. Private Procedure B. Labor Code Procedure C. Conciliation/Preventive Mediation IV. Bargainable Issues V. Collective Bargaining Agreement A. Definition B. Contents 1. Effect of sub-standard contract C. Registration
127 127 127 128 129 129 129 129 130 130 130 130 130 131 131 131 131 131 132 132 132 132 132 133 133 133 133 133 133 134 134 134 135 136 136 136 136 136 136 136 137 137 137 138 138 140 140 140 140 140 140
D. Beneficiaries E. Interpretation, administration and enforcement 1. Nature of contract and contract interpretation 2. Grievances a) Contract infirmity b) Contract ambiguity 3. Grievance procedure/ voluntary arbitration F. Contract duration and renewal G. Substitutionary Doctrine H. Arbitrated CBA I. CBA and 3rd party applicability Chapter 7: UNION CONCERTED ACTIVITIES I. Basis of Right to Engage in Concerted Activities A. Constitution B. Statutory C. Limitations II. Types of Concerted Activities A. Strike 1. Definition, nature, purpose 2. Effect on work relationship 3. Types and conversion 4. Grounds 5. Striking party 6. Procedural requirements 7. Test of legality B. Picketing 1. Definition, nature, purpose of picket line 2. Picketing and libel laws 3. Curtailment 4. Regulation/restrictions, innocent third party rule and liabilities 5. Prohibited activities; peaceful picketing C. Slowdown III. Role of Peace Officers During Strikes and Picketing A. Escorting B. Arrest and detention of law violators Chapter 8: EMPLOYER LOCKOUT I. Basis, definition, limitation II. Ground for lockout III. Prohibited lockout IV. Procedural requirements V. Effect of illegal lockout Chapter 9: LABOR INJUNCTION I. Definition and Nature II. General Rule and Exception III. Issuing Agency; Procedural Requirements A. NLRC; Labor Arbiter B. Procedural requirements and rules for issuance of labor injunctions C. TRO Chapter 10: LABOR RELATIONS IN PUBLIC SECTOR
141 141 141 141 141 141 141 142 143 143 143 144 144 144 144 144 144 144 145 145 146 146 147 148 149 153 153 153 154 154 155 155 155 155 155 156 156 156 156 156 156 157 157 157 158 158 158 159 160
LABOR RELATIONS
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Chapter 1. State Policy
Labor Relations
We would like to thank and acknowledge Prof. Domingo P. Disini, Jr., Prof. Patricia R.P. Salvador-Daway, Prof. E. (Leo) Battad and Atty. Francis Sobrevias for allowing the UP Professional Enhancement Program Writers and Editors as well as the Bar Operations Commission Academics Committee to use and consult their respective Labor Law outlines.
FACULTY-STUDENT EDITORIAL BOARD AND LECTURES COMMITTEE Prof. E. (Leo) Battad

FACULTY EDITOR
LABOR & SOCIAL LEGISLATION Fame Cruz

SUBJECT EDITORS
LECTURES Edel Cruz

HEAD
ACADEMICS COMMITTEE Samantha Poblacion

DIRECTOR FOR ACADEMICS EDITOR-IN-CHIEF
LABOR STANDARDS Jen Paguntalan

LEAD WRITER
Jason Mendoza
DEPUTY HEAD
LABOR RELATIONS
Rania Joya
DEPUTY DIRECTOR FOR ACADEMICS LAYOUT HEAD
Malds Menzon
LOGISTICS, HR
-------Kae Guerrero
PRINTING AND DISTRIBUTION
Cesar Baluyut Fifi Burkeley Aaron Ho Jen Reyes Diana Bello

WRITER
-------Leo Zulueta
LOGO, COVER AND TEMPLATE DESIGN

I. II. III. IV. Methods of Dispute Settlement Trade Unionism Work Enlightenment Machinery for Dispute Settlement A. National Labor Relations Commission (NLRC) B. National Conciliation and Mediation Board (NCMB) C. Bureau of Labor Relations D. Voluntary Arbitration Advisory Council (VAAC) E. Administrative Intervention for Dispute Avoidance V. Industrial Peace VI. Worker Participation in Decision and Policy Making Processes Affecting Rights, Duties, and Welfare
d) regulate the relations between workers and employers. 2) The State shall assure the rights of workers to: a) self-organization, b) collective bargaining, c) security of tenure, and d) just and humane conditions of work. Art. 211: Declaration of Policy a. To promote and emphasize the primacy of free collective bargaining and negotiations, including voluntary arbitration, mediation and conciliation, as modes of settling labor or industrial disputes;
I. METHODS SETTLEMENT
OF
DISPUTE
1987 Consti, Art. XIII, Sec. 3. par. 3: The State shall: 1) Promote the principle of shared responsibility between workers and employers and the preferential use of voluntary modes in settling disputes, including conciliation, and 2) Enforce their mutual compliance therewith to foster industrial peace. Art. 3: Declaration of Basic Policy. 1) The State shall: a) afford protection to labor, b) promote full employment, c) ensure equal work opportunities regardless of sex, race or creed, and
Manila Diamond Hotel Employees Union v. CA (2005) The State encourages an environment wherein employers and employees themselves must deal with their problems in a manner that mutually suits them best. Hence, a voluntary, instead of compulsory, mode of dispute settlement is the general rule. EXEMPTION: Art. 263(g) of the LC which allows the Sec. of Labor to assume jurisdiction over a labor dispute involving an industry indispensable to the national interest. This law was written as a means to be used by the State to protect itself from an emergency or crisis. It is not for labor, nor is it for management. It is an exercise of the police power of the State for a prolonged strike or lockout can be inimical to the national economy and, therefore, the situation is
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imbued with public necessity and involves the right of the State and the public to self protection. As to the Sec of Labors orders: All workers must immediately return to work and all employers must readmit them under the same terms and conditions prevailing before the strike or lockout. Such contemplates only actual reinstatement. Thus, a strained relationship between the ee-er is no reason for payroll reinstatement in lieu of actual reinstatement.
2. CBA, 3. The prevailing labor relations system, and 4. All their rights and obligations under existing labor laws. Art. 277: Miscellaneous Provisions a. All unions are authorized to collect: reasonable membership fees, union dues, assessments and fines, and other contributions for labor education and research, mutual death and hospitalization benefits, welfare fund, strike fund and credit and cooperative undertakings.
LABOR RELATIONS
II. TRADE UNIONISM

Art. 211: Declaration of Policy b. To promote free trade unionism as an instrument for the enhancement of democracy and the promotion of social justice and development. c. To foster the free and voluntary organization of a strong and united labor movement. Art. 212 (g): LABOR ORGANIZATION 1) union or association of employees 2) which exists in whole or in part xxx 3) for the purposes of: collective bargaining concerning terms and conditions of employment, or of dealing with employers concerning term
Art. 270: TRADE UNION ACTIVITIES 1) Organization, formation and administration of labor organization; 2) Negotiation and administration of collective bargaining agreements; 3) All forms of concerted union action; 4) Organizing, managing, or assisting union conventions, meetings, rallies, referenda, teach-ins, seminars, conferences and institutes; 5) Any form of participation or involvement in representation proceedings, representation elections, consent elections, union elections; and 6) Other activities or actions analogous to the foregoing.
Victoria v. Inciong (1988) As a matter of responsibility and answerability, a union leader must see to it that the policies and activities of the union in the conduct of labor relations are within the precepts of law and any deviation from the legal boundaries shall be imputable to the leader. As a strike is an economic weapon at war, the strikers must accept the entire risks attendant upon their choice. In that, if they fail, they cannot thereafter invoke the protection of the law for the consequences of their conduct unless the right they wished vindicated is one which the law will, by all means, protect and enforce. A union leader has a duty to see to it that the policies and activities of the union in the conduct of labor relations are within the precepts of law, and any deviation from the legal boundaries shall be imputable to the leader. He bears the responsibility of guiding the union along the path of law and to cause the union to demand what is not legally demandable.
IV. MACHINERY SETTLEMENT
FOR
DISPUTE
III.WORKER ENLIGHTENMENT
Art. 211 (d): Declaration of Policy To promote the enlightenment of workers concerning their rights and obligations as union members and as employees; Art. 241 (p): Rights and Conditions of Membership in a Labor Organization It shall be the duty of any labor organization and its officers to inform its members on the: 1. Provisions of its constitution and by-laws,
Art. 211: Declaration of Policy. e. To provide an adequate administrative machinery for the expeditious settlement of labor or industrial disputes.
A. NATIONAL LABOR COMMISSION (NLRC)
RELATIONS
Art. 212: Definitions "Commission" means the National Labor Relations Commission or any of its divisions, as the case may be, as provided under this Code.
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1. Art. 213: National Labor Relations Commission a. Composition: 1) There shall be a National Labor Relations Commission which shall be attached to the Department of Labor and Employment for program and policy coordination only, composed of a Chairman and fourteen (14) Members. a) Chairman b) 14 members i) 5 from among nominees of workers organizations ii) 5 from among nominees of employers organizations iii) 4 from among the recomendees of the Sec. of Labor and Employment 2) Upon assumption into office, the members nominated by the workers and employers organizations shall divest themselves of any affiliation with or interest in the federation or association to which they belong. 3) Whenever the required membership in a division is not complete and the concurrence of 2 Commissioners to arrive at a judgment or resolution cannot be obtained, the Chairman shall designate such number of additional Commissioners from the other divisions as may be necessary. 4) The Chairman, aided by the Executive Clerk of the NLRC, shall have administrative supervision over the NLRC and its regional branches and all its personnel, including the Executive Labor Arbiters and Labor Arbiters. b. Divisions: 1) The NLRC may sit en banc or in 5 divisions, each composed of 3 members. 2) The NLRC shall exercise its adjudicatory and all other powers, functions, and duties through its divisions. 3) The Chairman shall be the Presiding Commissioner of the first division and the 4 other members from the public sector shall be the Presiding Commissioners of the 2nd, 3rd, 4th, and 5th divisions, respectively. In case of the effective absence or incapacity of the Chairman, the Presiding Commissioner of the 2nd
division shall Chairman.
be
the
Acting
4) The 1st, 2nd, and 3rd divisions shall handle cases coming from the National Capital Region and the parts of Luzon; and the 4th and 5th divisions, cases from the Visayas and Mindanao, respectively. 5) The divisions of the NLRC shall have exclusive appellate jurisdiction over cases within their respective territorial jurisdictions. c. Judgments and Resolutions
LABOR RELATIONS
1) The concurrence of 2 Commissioners of a division shall be necessary for the pronouncement of judgment or resolution. 2) The conclusions of a division on any case submitted to it for decision shall be reached in consultation before the case is assigned to a member for the writing of the opinion. 3) It shall be mandatory for the division to meet for purposes of the consultation ordained herein. A certification to this effect signed by the Presiding Commissioner of the division shall be issued and a copy thereof attached to the record of the case and served upon the parties. d. En Banc: 1) The NLRC shall sit en banc for purposes of: a. Promulgating rules and regulations governing the hearing and disposition of cases before any of its divisions and regional branches, and b. Formulating policies affecting its administration and operations. 2) The NLRC sitting en banc may, on temporary or emergency basis, allow cases within the jurisdiction of any division to be heard and decided by any other division (a) whose docket allows the additional workload and (b) such transfer will not expose litigants to unnecessary additional expense.
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3) The NLRC, when sitting en banc shall be assisted by the same Executive Clerk and, when acting thru its Divisions, by said Executive Clerks for the second, third, fourth and fifth Divisions, respectively, in the performance of such similar or equivalent functions and duties as are discharged by the Clerk of Court and Deputy Clerks of Court of the Court of Appeals. 2. Art. 217: Jurisdiction of the Labor Arbiters and the Commission a. Original and Exclusive Jurisdiction of Labor Arbiters 1) Unfair labor practice cases; 2) Termination disputes; 3) Cases involving wages, rates of pay, hours of work and other terms and conditions of employment, if accompanied with a claim for reinstatement; 4) Claims for actual, moral, exemplary and other forms of damages arising from the employer-employee relations; 5) Cases arising from violation of Art. 264, including questions involving the legality of strikes and lockouts; and 6) All other claims arising from employer-employee relations, including those of persons in domestic or household service, involving an amount exceeding P5,000 regardless of whether accompanied with a claim for reinstatement, 7) EXCEPT claims for: a. Employees Compensation, b. Social Security, c. Medicare and d. Maternity benefits: b. Period within which to Decide The Labor Arbiters shall hear and decide the cases mentioned in (A) within 30 calendar days after the submission of the case by the parties for decision without extension, even in the absence of stenographic notes. c. Appeal to the NLRC The NLRC shall have exclusive appellate jurisdiction over all cases decided by Labor Arbiters.
d. Referral to Grievance Machinery and Voluntary Arbitration The Labor Arbiter shall dispose of the following by referring them to grievance machinery and voluntary arbitration: 1) Cases arising from the interpretation or implementation of collective bargaining agreements (CBA), and 2) Cases arising from the interpretation or enforcement of company personnel policies. AND
LABOR RELATIONS
B. NATIONAL CONCILIATION MEDIATION BOARD (NCMB)
Art. 212: Definitions c. "Board" means the National Conciliation and Mediation Board established under Executive Order No. 126. Art. 250: Procedure in Collective Bargaining a. If the dispute is not settled, the Board shall intervene upon request of either or both parties or at its own initiative and immediately call the parties to conciliation meetings. The Board shall have the power to issue subpoenas requiring the attendance of the parties to such meetings. It shall be the duty of the parties to participate fully and promptly in the conciliation meetings the Board may call; b. During the conciliation proceedings in the Board, the parties are prohibited from doing any act which may disrupt or impede the early settlement of the disputes; and c. The Board shall exert all efforts to settle disputes amicably and encourage the parties to submit their case to a voluntary arbitrator.
C. BUREAU (BLR)
OF
LABOR
RELATIONS
Art. 212: Definitions b. "Bureau" means the Bureau of Labor Relations and/or the Labor Relations Divisions in the regional offices established under P.D. No. 1, in the Department of Labor.
1. Art. 226: Bureau of Labor Relations a. Original and Exclusive Authority The BLR and the Labor Relations Divisions in the regional offices of the Department of Labor, shall have original and exclusive authority to act, at their own initiative or upon request of either or both parties, on:
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1)
All inter-union and intra-union conflicts, and 2) All disputes, grievances or problems arising from or affecting labor-management relations in all workplaces, whether agricultural or non-agricultural, EXCEPT those arising from the implementation or interpretation of collective bargaining agreements which shall be the subject of grievance procedure and/or voluntary arbitration. b. Period within which to Decide The Bureau shall have 15 working days to act on labor cases before it, subject to extension by agreement of the parties. VOLUNTARY ARBITRATION ADVISORY COUNCIL (VAAC)
b) Include in the CBA a procedure for the selection of such Voluntary Arbitrator or panel of Voluntary Arbitrators, preferably from the listing of qualified Voluntary Arbitrators duly accredited by the Board. 2) In case the parties fail to select a Voluntary Arbitrator or panel of Voluntary Arbitrators, the Board shall designate the Voluntary Arbitrator or panel of Voluntary Arbitrators, as may be necessary, pursuant to the selection procedure agreed upon in the CBA, which shall act with the same force and effect as if the Arbitrator or panel of Arbitrators has been selected by the parties as described above.
Manila Central Line Free Workers Union v. Manila Central Line Corp. (1998): 1) The essence of voluntary arbitration is that it is by agreement of the parties, rather than compulsion of law, that a matter is submitted for arbitration. It does not matter that the person chosen as arbitrator is a labor arbiter who, under Art 217 of the Labor Code, is charged with the compulsory arbitration of certain labor cases. There is nothing in the law that prohibits these labor arbiters from also acting as voluntary arbitrators as long as the parties agree to have him hear and decide their dispute.
LABOR RELATIONS
D.
Art. 212: Definitions d. "Council" means the Tripartite Voluntary Arbitration Advisory Council established under E.O. No. 126, as amended.
2)
2. Art. 260: Grievance Machinery and Voluntary Arbitration a. Establishing Machinery for Dispute Settlement The parties to a CBA shall: 1) Include therein provisions that will ensure the mutual observance of its terms and conditions. 2) Establish a machinery for the adjustment and resolution of grievances: a) Arising from the interpretation of their CBA, and b) Those arising from the interpretation or enforcement of company personnel policies. b. Time Frame All grievances submitted to the grievance machinery which are not settled within 7 calendar days from the date of its submission shall automatically be referred to voluntary arbitration prescribed in the CBA.
3)
3. Art. 261: Jurisdiction of Voluntary Arbitrators or panel of Voluntary Arbitrators 1) The Voluntary Arbitrator or panel of Voluntary Arbitrators shall have original and exclusive jurisdiction over all: a) Unresolved grievances arising from the interpretation or implementation of the CBA, and b) Those arising from the interpretation or enforcement of company personnel policies referred to in the immediately preceding article. 2) Violations of a CBA, except those which are gross in character, shall no longer be treated as unfair labor practice and shall be resolved as grievances under the CBA.
Gross violations of CBA shall mean flagrant and/ or malicious refusal to comply with the economic provisions of such agreement.
c. Selection 1) For the purpose of voluntary arbitration mentioned in B), the parties to a CBA shall: a) Name and designate in advance a Voluntary Arbitrator (VA) or panel of Voluntary Arbitrators, or
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3) The Commission, its Regional Offices and the Regional Directors of the Department of Labor and Employment shall not entertain disputes, grievances or matters under the exclusive and original jurisdiction of the Voluntary Arbitrator or panel of Voluntary Arbitrators and shall immediately dispose and refer the same to the Grievance Machinery or Voluntary Arbitration provided in the CBA.
Viviero v. Court of appeals (2000): 1) 2) General rule: termination disputes fall within the jurisdiction of the Labor Arbiter. Exception: where the CBA states in unequivocal language that termination disputes shall be submitted to voluntary arbitration. There is a need for an express stipulation in the CBA that illegal termination disputes should be resolved by a Voluntary Arbitrator or Panel of Voluntary Arbitrators, since the same fall within a special class of disputes that are generally within the exclusive original jurisdiction of Labor Arbiters by express provision of law. Absent such express stipulation, the phrase "all disputes" should be construed as limited to the areas of conflict traditionally within the jurisdiction of Voluntary Arbitrators, i.e., disputes relating to contract-interpretation, contractimplementation, or interpretation or enforcement of company personnel policies. Illegal termination disputes - not falling within any of these categories - should then be considered as a special area of interest governed by a specific provision of law.
5) 6)
In the instant case, while the submission agreement mentioned only the determination of the date or regularization, law and jurisprudence give the voluntary arbitrator enough leeway of authority as well as adequate prerogative to accomplish the reason for which the law on voluntary arbitration was created speedy labor justice.
Art. 262: Jurisdiction over other Labor Disputes The Voluntary Arbitrator or panel of Voluntary Arbitrators, upon agreement of the parties, shall also hear and decide all other labor disputes including unfair labor practices and bargaining deadlocks
LABOR RELATIONS
4. Art. 262-A: Procedures 1) The voluntary Arbitrators or panel of Voluntary Arbitrators shall have the power to hold hearings, receive evidences and take whatever action is necessary to resolve the issue or issues subject of dispute, including efforts to effect a voluntary settlement between parties. 2) All parties to the dispute shall be entitled to attend the arbitration proceedings. 3) The attendance of any third party or the exclusion of any witness from the proceedings shall be determined by the Voluntary Arbitrator or panel of Voluntary Arbitrators. 4) Hearing may be adjourned for a cause or upon agreement by the parties. 5) Unless the parties agreed otherwise, it shall be mandatory for the Voluntary Arbitrators or panel of Voluntary Arbitrators to render an award or decision within twenty (20) calendar days from the date of submission of the dispute to voluntary arbitration. 6) The award or decision shall contain the facts and the law on which it is based. 7) It shall be final and executory after ten (10) calendar days from receipt of the copy of the award or its decision by the parties. 8) Upon motion of any interested party, the Voluntary Arbitrator or panel of Voluntary Arbitrators or the Labor Arbiter in the region where the movant resides, in case of the absence or incapacity of the voluntary arbitrator or panel of voluntary arbitrators for any reason, 9) may issue a writ of execution requiring the sheriff of the Commission or regular
3)
4)
5)
Ludo and Luym Corp v. Saornido (2003): 1) 2) Generally, the arbitrator is expected to decide only those questions expressly delineated by the submission agreement. Nevertheless, the arbitrator can assume that he has the necessary power to make a final settlement since arbitration is the final resort for the adjudication of disputes. The SC stressed that the Voluntary Arbitrator had plenary jurisdiction and authority to interpret the agreement to arbitrate and to determine the scope of his own authority subject only, in a proper case, to the certiorari jurisdiction of this Court. The Arbitrator, as already indicated, viewed his authority as embracing not merely the determination of the abstract question of whether or not a performance bonus was to be granted but also, in the affirmative case, the amount.
3)
4)
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Courts or any public official whom the parties may designate in the submission agreement to execute the final decision, order, or award.
Davao Integrated v. Abarquez (1993): 1) The VA has authority to direct the commutation of the unenjoyed portion of the sick leave with pay benefits of intermittent workers. 2) Such authority is a necessary consequence of the exercise of his arbitral power under Article 261 of the Labor Code. Rule VII, Section 1 of the Procedural Guidelines in the Conduct of Voluntary Arbitration Proceedings defines what constitutes the voluntary arbitrators decision (and, by extension, that of the Panel of voluntary arbitrators): Sec. 1. Decision Award. 1) 2) The final arbitral disposition of issue/s submitted to voluntary arbitration is the Decision. The disposition may take the form of a dismissal of a claim or grant of specific remedy, either by way of prohibition of particular acts or specific performance of particular acts. In the latter case the decision is called an Award.
Arbitrators, whether shouldered wholly by the parties or subsidized by the special voluntary arbitration fund, shall take into account the following factors: a) Nature of the case; b) Time consumed in hearing the case; c) Professional standing of the Voluntary Arbitrator; d) Capacity to pay of the parties.
E. ADMINISTRATIVE INTERVENTION FOR DISPUTE AVOIDANCE 1. D.O.L.E. CIRCULAR No. 1 Series of 2006 ADMINISTRATIVE INTERVENTION FOR DISPUTE AVOIDANCE 1) Either or both the employer and the certified collective bargaining agent (or the representative of the employees where there is no certified bargaining agent) may voluntarily bring to the Office of the Secretary of Labor and Employment, through a REQUEST FOR INTERVENTION, any potential or ongoing dispute. A potential or ongoing dispute refers to: a. a live and active dispute; b. that may lead to a strike or lockout or to massive labor unrest; and c) is not the subject of any complaint or notice of strike or lockout at the time a request for intervention is made. 2) This recourse is separate from the established dispute resolution modes of mediation, conciliation and arbitration under the Labor Code, and is an alternative to other voluntary modes of dispute resolution such as the voluntary submission of a dispute to the Regional Director for mediation, to the National Conciliation and Mediation Board (NCMB) for preventive mediation, or to the intervention of a regional or local tripartite peace council for the same purpose.
LABOR RELATIONS
3)
Citibank Employees Union v. MOLE (1980): 1) The award of the arbitrator is not to be equated with a judicial decision. 2) The arbitrator's award, when stipulated by the parties to be conclusive, becomes part and parcel of the CBA. 3) Regardless of any law anterior or posterior to the Arbitrator's award, the CBA in this case has been correspondingly amended in a manner that is unalterable, immovable and immutable like the rock of Gibraltar, during the lifetime of the said CBA. Imperial Textile Miles, etc. Calica (1992) 1) 2) The Voluntary Arbitrator lost jurisdiction over the case submitted to him the moment he rendered his decision. Therefore, he could no longer entertain a motion for reconsideration of the decision for its reversal or modification.
Art. 262-B: Cost of Voluntary Arbitration and Voluntary Arbitrators Fee 1) The parties to a Collective Bargaining Agreement shall provide therein a proportionate sharing scheme on the cost of the voluntary arbitration including the Voluntary Arbitrators fee. The fixing of the fee of the Voluntary
2)
3) All requests shall be in writing and filed with the Office of the Secretary of Labor. The Request shall state: a. The name and address of the employer;
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b. The name of the certified bargaining agent, or the employee representative duly designated in writing by a majority of the employees where there is no collective bargaining agent; c. The number of employees affected by the potential or ongoing dispute; and d. A brief description of the potential or ongoing dispute. Upon receipt of the request, the Office of the Secretary shall notify the parties and invite them for conference. The conference for requests coming from the NCR, Regions III, IV-A or IV-B shall be held at the Office of the Secretary of Labor and Employment UNLESS the Secretary otherwise directs. The conference for requests coming from the other regions shall be conducted by the Regional Director for the Secretary. The Office of the Secretary or the Regional director, in the proper case, shall proceed to intervene after the parties shall have manifested that: a) They voluntarily submit their potential or ongoing dispute to intervention by the Office of the Secretary of Labor and Employment; b) There is no pending notice of strike or lockout or any related complaint in relation with their potential or ongoing dispute; c) They shall refrain from any strike or lockout or any form of work stoppage or from filing any related complaint while the Secretary's intervention is in effect; and d) They shall abide by the agreement reached, whose terms may be enforced through the appropriate writs issued by the Secretary of Labor and Employment. 5) All agreements settling the dispute shall be in writing and signed by the parties as well as the official who mediated the dispute. 6) The parties and officials or employees of the D.O.L.E. who took part in the intervention proceedings shall not testify in any court or body regarding the disclosures, submissions or positions made by the parties in these proceedings.
7) If the intervention fails, either or both parties may: a) Avail themselves of the remedies provided under the Labor Code; or b) Submit their dispute to the Office of the Secretary for voluntary arbitration, which shall be: o Limited to the issues defined in the parties' submission to voluntary arbitration agreement, and o Decided on the basis of the parties' position papers and submitted evidence.
LABOR RELATIONS
8) The Office of the Secretary shall resolve the dispute within 60 days from the parties' submission of the dispute for resolution.
St. Martins Funeral Homes v. NLRC (1998) Aside from the underlying power of the courts to scrutinize the acts of agencies on questions of law and jurisdiction, from the committee conferences of the legislature, it was clearly shown that there was still an intention to have issues arising from the Labor Code to still be appealable to the Supreme Court. Thus, since appeals from the NLRC to the SC were eliminated by express provision, the legislative intendment was that the special civil action of certiorari (Rule 65) is the proper vehicle for judicial review of decisions of the NLRC rather than an original action for certiorari (Rule 45). It must be noted that appeals by certiorari and the original action for certiorari are both modes of judicial review addressed to the appellate courts. A distinction between them, however, is that the special civil action of certiorari is within the concurrent original jurisdiction of SC and the CA, whereas direct appeals by certiorari to the SC would subvert the intention of expanding the CA jurisdiction to transfer some of the burden of review of factual issue from SC to CA. Therefore, all such petitions should henceforth be initially filed in the Court of Appeals in strict observance of the Doctrine of Hierarchy of Courts as the appropriate forum for the relief desired. Deltaventures v. Cabato (2000) RTC, being a co-equal body of the NLRC, has no jurisdiction to issue any restraining order or injunction to enjoin the execution of any decision of the latter. The broad powers granted to the LA and to the NLRC by the LC can only be interpreted as vesting in them jurisdiction over incidents arising from, in connection with or
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relating to labor disputes to the exclusion of the regular courts. Thus, subject matter incident of a labor case is a matter beyond the jurisdiction of regional trial courts. To hold otherwise is to sanction split jurisdiction which is obnoxious to the orderly administration of justice. Also in this case: By filing its 3rd party claim with the deputy sheriff, petitioner submitted itself to the jurisdiction of the Commission acting through the Labor Arbiter and Jurisdiction once acquired is not lost upon the instance of the parties but continues until the case is terminated.
2) The Secretary of Labor shall also: a) Take all the necessary steps within his power as may be prescribed by law to alleviate industrial unrest; and b) From time to time recommend the enactment of such remedial legislation as in his judgment may be desirable for the maintenance and promotion of industrial peace.
VI. WORKER PARTICIPATION IN DECISION AND POLICY MAKING

LABOR RELATIONS
V. INDUSTRIAL PEACE
Art. 211 (f): Declaration of Policy To ensure a stable but dynamic and just industrial peace. Art. 273: Study of Labor-Management Relations 1) The Secretary of Labor shall have the power and duty to inquire into: a. Existing relations between employers and employees in the Philippines; b. Growth of associations of employees and the effect of such associations upon employer-employee relations; c. Extent and results of the methods of collective bargaining in the determination of terms and conditions of employment; d. Methods tried by employers and associations of employees for maintaining mutually satisfactory relations; e. Desirable industrial practices which have been developed through collective bargaining and other voluntary arrangements; f. Possible ways of increasing the usefulness and efficiency of collective bargaining for settling differences; g. Possibilities for the adoption of practical and effective methods of labor-management cooperation; h. Any other aspects of employeremployee relations concerning the promotion of harmony and understanding between the parties; and i. Relevance of labor laws and labor relations to national development. j. Causes of industrial unrest.
1987 Constitution, Art. XIII, sec.3, par. 2: xxx The workers shall also participate in policy and decision-making processes affecting their rights and benefits as may be provided by law. Art. 211 (g): Declaration of State Policy: To ensure the participation of workers in decision and policy-making processes affecting their rights, duties, and welfare.
Art. 255: Exclusive Bargaining Representation and Workers Participation in Policy and DecisionMaking 1) Any provision of law to the contrary notwithstanding, a) Workers shall have the right, subject to such rules and regulations as the Secretary of Labor and Employment may promulgate, b) To participate in policy and decisionmaking processes of the establishment where they are employed c) Insofar as said processes will directly affect their rights, benefits and welfare. 2) For this purpose, workers and employers may form labormanagement councils: PROVIDED, That the representatives of the workers in such labor-management councils shall be elected by at least the majority of all employees in said establishment.
Art. 277 (g): Miscellaneous Provisions 1) The Ministry shall help promote and gradually develop, with the agreement of labor organizations and employers, 2) Labor-management cooperation programs at appropriate levels of the enterprise 3) Based on shared responsibility and mutual respect
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4) In order to ensure industrial peace and improvement in productivity, working conditions and the quality of working life.
PAL v. NLRC (1993) The exercise of management prerogatives is not unlimited. It is circumscribed by limitations found in law, a CBA, or the general principles of fair play and justice. A line must be drawn between management prerogatives regarding business operations per se and those which affect the rights of the employees. In treating the latter, management should see to it that its employees are at least properly informed of its decisions or modes of action. Industrial peace cannot be achieved if the employees are denied their just participation in the discussion of matters affecting their rights. In this case: Company Code of Discipline are not purely businessoriented nor do they concern the management aspect of the business of the company because they clearly have repercussions on the employee's right to security of tenure: the implementation may result in the deprivation of an employee's means of livelihood which is a property right. And although during the formulation of the Code, Republic Act No. 6715 (Participation of workers in decision and policy-making processes affecting their rights, duties and welfare) had not yet been enacted, the attainment of a harmonious labor-management relationship and the then already existing state policy of enlightening workers concerning their rights as employees demand no less than the observance of transparency in managerial moves affecting employees' rights. Manila Electric Co. v. Quisumbing (2000) A line must be drawn between management prerogatives regarding business operations per se and those which affect the rights of the employees. Hiring of workers is within the employers inherent freedom to regulate and is a valid exercise of its management prerogative subject only to special laws and agreements on the matter and the fair standards of justice.
Contracting out of services is an exercise of business judgment or management prerogative. Management cannot be denied the faculty of promoting efficiency and attaining economy by a study of what units are essential for its operations. Absent proof that management acted in a malicious or arbitrary manner, the Court will not interfere with the exercise of judgment by an employer.
LABOR RELATIONS
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Chapter 2. Right to Self Organization

I. Basis of Right to Self-Organization A. 1987 Constitution B. Labor Code II. Extent and Scope of Right III. Worker Qualification IV. Covered Employees/Workers A. All Employees B. Government Corporate Employees C. Supervisory Employees D. Aliens E. Security Guards V. Excluded Employees/Workers A. Managerial Employees and Confidential Employees B. Worker/Member of Cooperative C. Employees of International Organizations D. Non-Employees VI. Party Protected VII. Non-Abridgment of Right and Sanctions for Violation of Right
and those without any definite employers may form labor organizations for their mutual aid and protection. UST Faculty Union v Bitonio (1999): 1) Self-organization is a fundamental right guaranteed by the Philippine Constitution and the Labor Code. Employees have the right to form, join or assist labor organizations for the purpose of collective bargaining or for their mutual aid and protection. Whether employed for a definite period or not, any employee shall be considered as such, beginning on his first day of service, for purposes of membership in a labor union. 2) Corollary to this right is the prerogative not to join, affiliate with or assist a labor union. Therefore, to become a union member, an employee must, as a rule, not only signify the intent to become one, but also take some positive steps to realize that intent.
LABOR RELATIONS
II. EXTENT AND SCOPE OF RIGHT

ART. 246: Non-abridgment of Right to Self-Organization It shall be unlawful for any person to restrain, coerce, discriminate against or unduly interfere with employees and workers in their exercise of the right to selforganization. Pan-American World Airways, Inc. v. PanAmerican Employees Association (1969) A union has a right to choose ones leaders. In this case: If Pan Am were to succeed in its demand not to extend return-to work order to 5 union officials, the union would be confronted with the leaders of their choice condemned as irresponsible, possibly even constituting a menace to the operations of the enterprise. This would be to call into question their undeniable right to choose their leaders, who must be treated as such with all the respect to which they are legitimately entitled. Central Negros Electric Cooperative Inc. v. Secretary of Labor (1991) Right to join necessarily includes the right to withdraw from an organization. Membership in the cooperative is on a voluntary basis hence, withdrawal therefrom cannot be restricted unnecessarily.
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I. BASIS OF RIGHT ORGANIZATION

A. 1987 CONSTITUTION
TO
SELF-
Art. III Sec. 8: The right of the people, including those employed in the public and private sectors, to form unions, associations, or societies for purposes not contrary to law shall not be abridged. Art. XIII Sec. 3: The state shall afford full protection to labor, local and overseas, organized and unorganized, and promote full 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. B. LABOR CODE

Art. 243: Coverage and Employees Right to Self-Organization (1) All persons employed in commercial, industrial and agricultural enterprises and in religious, charitable, medical, or educational institutions, whether operating for profit or not, shall have the right to self-organization and to form, join, or assist labor organizations of their own choosing for purposes of collective bargaining. (2) Ambulant, intermittent, and itinerant workers, self-employed people, rural workers
In this case: The right of the employees to self-organization is a compelling reason why the members withdrawal from the cooperative must be allowed. As pointed out by the union, the resignation of the member-employees is an expression of their preference for union membership over that of membership in the cooperative.
III.WORKER QUALIFICATION
Art. 277: Miscellaneous Provisions c. Any employee, whether employed definite period or not, shall, beginning first day of service, be considered employee for purposes of membership labor union. for a on his as an in any
Reyes v. Trajano (1992) The right of self-organization includes the right to organize or affiliate with a labor union or determine which of two or more unions in an establishment to join, and to engage in concerted activities with co-workers for purposes of collective bargaining through representatives of their own choosing, or for their mutual aid and protection. Logically, the right NOT to join, affiliate with, or assist any union, and to disaffiliate or resign from a labor organization, is subsumed in the right to join. It is self-evident that just as no one should be denied the exercise of a right granted by law, so also, no one should be compelled to exercise such a conferred right. The fact that a person has opted to acquire membership in a labor union does not preclude his subsequently opting to renounce such membership. A right comprehends at least 2 broad notions, namely: (1) liberty / freedom: the absence of legal restraint, whereby an employee may act for himself without being prevented by law; and (2) power: whereby an employee may, as he pleases, join or refrain from joining an association. Also in this case: Whether the prevailing "NO UNION" votes are inspired by considerations of religious belief or discipline, or not, are beside the point, and may not be inquired into at all.
UST Faculty Union v. Bitonio (1999) Whether employed for a definite period or not, any employee shall be considered as such, beginning on his first day of service, for purposes of membership in a labor union. To become a union member, an employee must, as a rule, not only signify the intent to become one, but also take some positive steps to realize that intent. The procedure for union membership is usually embodied in the union's constitution and bylaws On joining a labor union, the constitution and by-laws become a part of the member's contract of membership under which he agrees to become bound by the constitution and governing rules of the union so far as it is not inconsistent with controlling principles of law. "The point to be stressed is that the union's CONSTITUTION AND BYLAWS is the fundamental law that governs the relationship between and among the members of the union. It is where the rights, duties and obligations, powers, functions and authority of the officers as well as the members are defined. It is the organic law that determines the validity of acts done by any officer or member of the union. Without respect for the CBL, a union as a democratic institution degenerates into nothing more than a group of individuals governed by mob rule." The importance of a union's constitution and bylaws cannot be overemphasized for they embody a covenant between a union and its members and constitute the fundamental law governing the members' rights and obligations. As such, the union's constitution and bylaws should be upheld, as long as they are not contrary to law, good morals or public policy.
LABOR RELATIONS
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IV. COVERED EMPLOYEES/WORKERS

A. ALL EMPLOYEES
Who is an employee? Art 212 (f) Employee includes: 1) 2) 3) Any person in the employ of an employer. The term shall not be limited to the employees of a particular employer, unless this code 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.
Art. 245: Ineligibility of Managerial Employees to Join any Labor Organization; Right of Supervisory Employees Managerial employees are not eligible to join, assist or form any labor organization. Supervisory employees shall not be eligible for membership in a labor organization of the rankand-file employees but may join, assist or form separate labor organizations of their own.
4)
IRR Book V Rule I Sec. 1: (nn) Rank-and-File Employee refers to an employee whose functions are neither managerial nor supervisory in nature. FEU-Dr. Nicanor Reyes Medical Foundation Inc. v. Trajano (1992) Art 244 of the LC as amended by BP 70 effectively eliminated the doubt as to WON rank and file employees of nonprofit medical institutions can form, organize or join unions for collective bargaining. Art. 244 now allows employees of non-profit organizations to join, form and/or assist labor organizations. B. GOVERNMENT EMPLOYEES CORPORATE
Art 244: Right of Employees in the Public Service Employees of government corporations established under the corporation code shall have the right to organize and to bargain collectively with their respective employers.
Toyota Motor Phil. Corp v. Toyota Phil. Corp. Labor Union (1997) A labor organization composed of both rank-and-file and supervisory employees is no labor organization at all and cannot, for any guise or purpose, be a legitimate labor organization. Not being one, an organization which carries a mixture of rank-and-file and supervisory employees cannot possess any of the rights of a legitimate labor organization, including the right to file a petition for certification election for the purpose of collective bargaining. RATIONALE: Supervisory employees while in the performance of supervisory functions, become the alter ego of management in the making and the implementing of key decisions at the sub-managerial level. The use of independent judgment in making the decision to hire, fire or transfer in the identification of manpower requirements would be greatly impaired if the employee's loyalties are torn between the interests of the union and the interests of management. It becomes necessary, therefore, anterior to the granting of an order allowing a certification election, to inquire into the composition of any labor organization whenever the status of the labor organization is challenged on the basis of Article 245 of the Labor Code D. ALIENS
Art. 269: Prohibition against Aliens; Exceptions All aliens, natural or juridical, as well as foreign organizations are strictly prohibited from engaging directly or indirectly in all forms of trade union activities without prejudice to normal contacts between Philippine labor unions and recognized international labor centers:
LABOR RELATIONS
C. SUPERVISORY EMPLOYEES Art. 212 (m): Supervisory employees are those who, in the interest of the employer, effectively recommend such managerial actions if the exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment.
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PROVIDED, that aliens working in the country with valid permits issued by the D.O.L.E., may: 1) Exercise the right to self-organization, and 2) Join or assist labor organizations of their own choosing for purposes of collective bargaining. PROVIDED, further, that said aliens are nationals of a country which grants the same or similar rights to Filipino workers.
1)
To form, join, or assist in the formation of a labor organization of their own choosing for purposes of collective bargaining and 2) To engage in concerned activities which are not contrary to law including the right to strike. Manila Electric Co. v.Sec. of Labor (1991) On Dec1986, President Aquino issued EO No. 111 which eliminated the provision on the disqualification of security guards and with that security guards were thus free to join a rank and file organization. Sec.18 of RA6715 amended Art 245 of the LC which now embodies the disqualification of the supervisory employees and does not include the security guards in such disqualification. Under the old rule, security guards were barred from joining labor organizations of the rank-and-file but under RA6715, they may now freely join a labor organization with the rank-and-file or the supervisory union, depending on their rank.
1. Art. 270: Assistance
Regulation
of
Foreign
1) No foreign individual, organization or entity 2) May give any donations, grants or other forms of assistance, in cash or in kind, directly or indirectly, 2) To any labor organization, group of workers or any auxiliary thereof, such as cooperatives, credit unions and institutions engaged in research, education or communication, 3) In relation to trade union activities, 4) Without prior permission by the Secretary of Labor. "Trade union activities" shall mean: 1. Organization, formation and administration of labor organization; 2. Negotiation and administration of collective bargaining agreements; 3. All forms of concerted union action; 4. Organizing, managing, or assisting union conventions, meetings, rallies, referenda, teach-ins, seminars, conferences and institutes; 5. Any form of participation or involvement in representation proceedings, representation elections, consent elections, union elections; and 6. Other activities or actions analogous to the foregoing. E. SECURITY GUARDS 1. D.O. No. 14 Series of 2001 Guidelines Governing the Employment and Working Conditions of Security Guards and Similar Personnel in the Private Security Industry 2. Sec. 10. Right to Self-Organization and Collective Bargaining The security guards and other personnel employed by the security service contractor shall have the right:
LABOR RELATIONS
V. EXCLUDED EMPLOYEES/WORKERS
A. MANAGERIAL EMPLOYEES CONFIDENTIAL EMPLOYEES AND
Who are managerial employees?

Art. 212 (m) Managerial Employee One who is vested with powers or prerogatives 1) to lay down and execute management policies, and/or 2) to hire, transfer, suspend, lay off, recall, discharge, assign or discipline employees. Art. 245: Ineligibility of Managerial Employees to Join any Labor Organization; Right of Supervisory Employees 1) Managerial employees are not eligible to join, assist or form any labor organization. 2) Supervisory employees shall not be eligible for membership in a labor organization of the rankand-file employees but may join, assist or form separate labor organizations of their own. Art. 245-A: Effect of Inclusion as Members of Employees Outside the Bargaining Unit
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The inclusion as union members of employees outside the bargaining unit shall not be a ground for the cancellation of the registration of the union. Said employees are automatically deemed removed from the list of membership of said union.
San Miguel Corp. Supervisors v. Laguesma (1997) Confidential employees are those who; (1) assist or act in a confidential capacity (2) to persons who formulate, determine, and effectuate management policies in the field of labor relations. These two criteria are cumulative, and both must be met if an employee is to be considered a confidential employee. The exclusion from bargaining units of employees who, in the normal course of their duties, become aware of management policies relating to labor relations is a principal objective sought to be accomplished by the "confidential employee rule. RATIONALE: Employees should not be placed in a position involving a potential conflict of interests. Even if an employee has access to confidential labor relations information BUT such is merely incidental to his duties and knowledge hereof is NOT necessary in the performance of such duties, said access does not render the employee a confidential employee. Metrolab Industries Inc. v. Roldan-Confessor (1996) Art. 245 limits the ineligibility to managerial EEs, but jurisprudence has extended the prohibition to confidential employees (those who by reason of their positions or nature of work are required to assist or act in a fiduciary manner to managerial employees and hence, are likewise privy to sensitive and highly confidential records). By the very nature of their functions, they assist and act in a confidential capacity to, or have access to confidential matters of, persons who exercise managerial functions in the field of labor relations. {Thus there is a fiduciary and confidential relationship between manager and employer.}
RATIONALE: If these managerial employees would belong to or be affiliated with a union, the latter might not be assured of their loyalty in view of evident conflict of interests. The union can also become companydominated. They may become the source of undue advantage, acting as spy/spies of either party. This is especially true in the present case where the petitioning union is already the bargaining agent of the rank-and-file employees.
LABOR RELATIONS
Pepsi-Cola v. Sec. of Labor (1999) RATIONALE: If these managerial employees would belong to or be affiliated with a union, the latter might not be assured of their loyalty in view of evident conflict of interests. The union can also become companydominated. They may become the source of undue advantage, acting as spy/spies of either party. Managerial employees and confidential employees are supposed to be on the side of the employer, to act as its reps, and to see to it that its interest are well protected. Collective bargaining in such a situation can become one-sided. Moreover, unionization of confidential employees for the purpose of CB would mean the extension of the law to persons or individuals who are supposed to act in the interest of the employers. It is not far-fetched that in the course of CB, they might jeopardize that interest which they are duty bound to protect. Paper Indurstries Corp. of the Philippines. v. Laguesma (2000) Managerial employees fall into 2 categories: (1) The Managers, composed of top and middle managers and; (2) The Supervisors, composed of First Line Managers. Top and Middle Managers have the authority to devise, implement and control strategic and operational policies while the task of First-Line Managers is simply to ensure that such policies are carried out by the R&F employees of an organization. Nomenclature is not conclusive: The mere fact that an employee is
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designated manager does not ipso facto make him one. Designation should be reconciled with the actual job description of the employee.
Cainta Catholic School v. Cainta Catholic School Employees Union (2006) Job descriptions or appellations are meaningless should it be established that the actual duties performed by the employees concerned were neither managerial nor supervisory in nature. However in this case: The finding that both union officers are employees not belonging to the rank-and-file, their membership in the Union has become questionable, rendering the Union inutile to represent their cause. B. WORKER/ COOPERATIVE MEMBER OF
they used as ground to oppose a petition for certification election of their employees union. This was because Art3 of PD1620 states, Verily, unless and until the Institute expressly waives its immunity, no summons, subpoena, orders, decisions or proceedings ordered by any court or administrative or quasi-judicial agency are enforceable as against the Institute. A certification election cannot be conducted in an international organization which the Phil. Government has granted immunity from local jurisdiction. The grant of such immunity is a political question whose resolution by the executive branch of government is conclusive upon the courts.
LABOR RELATIONS
D. NON-EMPLOYEES
Republic Planters v Laguesma (1996): 1) 2) Since the persons involved are not employees of the company, we held that they are not entitled to the constitutional right to join or form a labor organization for purposes of collective bargaining.
a. The right to collective bargaining is not available to an employee of a cooperative who at the same time is a member and co-owner thereof. b. The fact that the members-employees of petitioner do not participate in the actual management of the cooperative does not make them eligible to form, assist or join a labor organization for the purpose of collective bargaining with petitioner. c. They cannot invoke the right to collective bargaining for "certainly an owner cannot bargain with himself or his co-owners."
Central Negros Electric Cooperative Inc. v. Secretary of Labor (1991) Membership in the cooperative is on a voluntary basis hence withdrawal therefrom cannot be restricted unnecessarily. The right to join an organization necessarily includes the equivalent right not to join the same. The right of the employees to selforganization is a compelling reason why their withdrawal from the cooperative must be allowed.
C. EMPLOYEES OF ORGANIZATIONS
INTERNATIONAL
International Catholic Migration Commission v. Calleja (1990) In this case: There was a grant of diplomatic immunity to ICMC which
Singer Sewing Machine Co. v. Drilon (1993) Here since private respondents are found not to be employees of the Company, they are not entitled to the constitutional right to join or form a labor organization for purposes of collective bargaining. Accordingly, there is no constitutional and legal basis for their "union" to be granted their petition for direct certification. Citing La Suerte Cigar and Cigarette Factory v. Director of Bureau of Labor Relations the court here reiterated, The question of whether employeremployee relationship exists is a primordial consideration before extending labor benefits under the workmen's compensation, social security, medicare, termination pay and labor relations law. It is important in the determination of who shall be included in a proposed bargaining unit because, it is the sine qua non, the fundamental and essential condition that a bargaining unit be composed of employees.
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Failure to establish this juridical relationship between the union members and the employer affects the legality of the union itself. It means the ineligibility of the union members to present a petition for certification election as well as to vote therein.
Art. 288: Penalties 1) Penalty for violation of Labor Code provisions shall be: a) Fine of not less than P1,000 nor more than P10,000, or b) Imprisonment of not less than 3 months nor more than 3 years, or c) Both fine and imprisonment, at the discretion of the court. d) In addition, any alien found guilty shall be summarily deported upon completion of service of sentence. EXCEPT: a) As otherwise provided by the Code, or b) If the acts complained of hinge on a question of interpretation or implementation of ambiguous provisions of an existing CBA. 2) Any provision of law to the contrary notwithstanding, any criminal offense punished in this Code, shall be under the concurrent jurisdiction of the Municipal or City Courts and the Regional Trial Courts. Art. 289: Who are Liable when Committed by Other than Natural Person If the offense is committed by a corporation, trust, firm, partnership, association or any other entity, the penalty shall be imposed upon the guilty officer or officers of such corporation, trust, firm, partnership, association or entity.
VI. PARTY PROTECTED

Mactan Workers Union v. Aboitiz (1972) The benefits of the CBA extend to all employees in the bargaining unit, not just to members of majority union. Any other view would be a discrimination on which the law frowns, and the highly salutary purpose and objective of the collective bargaining scheme to enable labor to secure better terms in employment conditions, as well as rates of pay, would be frustrated insofar as non-members are concerned, deprived as they are of participation in whatever advantages could thereby be gained. What is entitled to constitutional protection is labor, or more specifically the working men and women, not labor organizations. The latter are merely the instrumentalities through which their welfare may be promoted and fostered.
LABOR RELATIONS
VII. NON-ABRIDGMENT OF RIGHT AND SANCTIONS FOR VIOLATION OF RIGHT

ART. 246. Non-abridgment of right to self-organization. - It shall be unlawful for any person to restrain, coerce, discriminate against or unduly interfere with employees and workers in their exercise of the right to self-organization. ART. 248. Unfair labor practices of employers. - It shall be unlawful for an employer to commit any of the following unfair labor practice: (a) To interfere with, restrain or coerce employees in the exercise of their right to selforganization ART. 247. Unfair labor practices are not only violations of the civil rights of both labor and management but are also criminal offenses against the State which shall be subject to prosecution and punishment as herein provided.
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Chapter 3. Labor Organization

I. POLICY II. DEFINITION OF LABOR ORGANIZATIONS AND UNIONS A. Labor Organization 1. Union 2. Workers Association B. Legitimate Labor Organization 1. Legitimate Workers Association C. Company Union III. UNION FUNCTION AND RATIONALE IV. GOVERNMENT REGULATION A. Union Registration: Procedure 1. Requirements and Rationale 2. Action on Application; Denial of Registration 3. Effect of Registration; Nonregistration 4. Rights of Legitimate Labor Organization B. Cancellation of Union Certificate of Registration V. INTERNATIONAL ACTIVITIES OF UNION: PROHIBITION AND REGULATION VI. UNION-MEMBER RELATIONS A. Nature of Relationship B. Issues and Concerns 1. Admission and Discipline of Members 2. Election of Officers; Qualifications; Manner of Election; Tenure and Compensation 3. Major Policy Matter 4. Union Funds: Payment of Attorneys Fees and Special Assessment 5. Mandatory Activity 6. Union Information 7. Enforcement and Remedies; Procedure and Sanctions VII. UNION AFFILIATION: LOCAL AND PARENT UNION RELATIONS A. Affiliation: Purpose and Nature of Relations 1. Independent Union/Local Union 2. Chartered Local (local/chapter) 3. Affiliate 4. National Union or Federation B. Supervisor/Rank and File Union Affiliation C. Local Union Disaffiliation/Mass Disaffiliation D. Period VIII. UNION SECURITY A. Statutory Basis and Rationale B. Validity Agreement and Effect on Freedom of Choice; Types of Union Security Provisions C. Coverage: Worker Inclusion and Exclusion D. Implementation: Obligation and Liabilities E. Financial Security: Agency Shop and Check-Off
I. POLICY
Art. 211: Declaration of Policy b. To promote free trade unionism as an instrument for the enhancement of democracy and the promotion of social justice and development; c. To foster the free and voluntary organization of a strong and united labor movement; d. To promote the enlightenment of workers concerning their rights and obligations as union members and as employees;
LABOR RELATIONS
II. DEFINITION OF LABOR ORGANIZATIONS AND UNIONS

Art. 211: Declaration of Policy g. To ensure the participation of workers in decision and policy-making processes affecting their rights, duties and welfare. ART 212: Definitions (g) Labor Organization Any union or association of employees which exists in whole or in part for the purpose of collective bargaining or of dealing with employers concerning terms and conditions of employment. (h) Legitimate Labor Organization Any labor organization duly registered with the Department of Labor and Employment, and includes any of its branch or local thereof j. Bargaining Representative a legitimate labor organization whether or not employed by the employer.
A. LABOR ORGANIZATION 1. Union Book V Rule 1 Sec. 1: Definition of Terms (zz) Union Any labor organization in the private sector organized for collective bargaining and for other legitimate purposes. 2. Workers Association Book V Rule 1 Sec. 1: Definition of Terms (ccc) Workers Association association of workers organized for the mutual aid and protection of its members or for any legitimate purpose other than collective bargaining.
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B. LEGITIMATE LABOR ORGANIZATION 1. Book V Rule 1 Sec. 1: Definition of Terms (ee) Legitimate Labor Organization any labor organization in the private sector registered or reported with the Department in accordance with Ruless III and IV of IRR of Labor Code. (ff) Legitimate Workers Association an association of workers organized for mutual aid and protection of its members or of any legitimate purpose other than collective bargaining registered with the D.O.L.E. in accordance with Rule III Secs. 20C and 2-D of the IRR of Labor Code. C. COMPANY UNION Book V Rule 1 Sec. 1: Definition of Terms i. Company Union any labor organization whose formation, function or administration has been assisted by any act defined as unfair labor practice by this Code.
2)
3) 4)
upon issuance of the certificate of registration based on the following requirements: a. Fifty pesos (50.00) registration fee; b. The names of its officers, their addresses, the principal address of the labor organization, the minutes of the organizational meetings and the list of the workers who participated in such meetings; c. In case the applicant is an independent union, the names of all its members comprising at least twenty percent (20%) of all the employees in the bargaining unit where it seeks to operate; If the applicant union has been in existence for one or more years, copies of its annual financial reports, and Four (4) copies of the constitution and bylaws of the applicant union, minutes of its adoption or ratification, and the list of the members who participated in it. Chartering and
LABOR RELATIONS
(RA 9481) ART 234-A: Creation of a Local Chapter 1) 2) 3)
III.UNION FUNCTION AND RATIONALE

Guijarno v. CIR 1973 The State shall assure the rights of workers to self-organization, collective bargaining, security of tenure, and just and humane conditions of work. Where does that leave a labor union, it may be asked: Correctly understood, it is nothing but the means of assuring that such fundamental objectives would be achieved. It is the instrumentality through which an individual laborer who is helpless as against a powerful employer may, through concerted effort and activity, achieve the goal of economic well-being.
4) 5) a. b.
6) a.
IV. GOVERNMENT REGULATION

A. UNION REGISTRATION: PROCEDURE 1. Requirements and Rationale
ART 234: Requirements of Registration 1) Any applicant labor organization, association or group of unions or workers shall acquire legal personality and shall be entitled to the rights and privileges granted by law to legitimate labor organizations
b.
A duly registered federation or national union may directly create a local chapter by issuing a charter certificate indicating the establishment of the local chapter. The chapter shall acquire legal personality only for purposes of filing a petition for certification election from the date it was issued a charter certificate. The chapter shall be entitled to all other rights and privileges of a legitimate labor organization only upon the submission of the following documents in addition to its charter certificate: The names of the chapters officers, their addresses, and the principal office of the chapter; and The chapters constitution and by-laws: Provided, That where the chapters constitution and by-laws are the same as that of the federation or the national union, this fact shall be indicated accordingly. The additional supporting requirements shall be: certified under oath by the secretary or treasurer of the chapter and attested by its president.
Art. 237: Additional Requirements for Federations or National Unions Subject to Article 238, if the applicant for registration is a federation or a national union, it shall, in addition to the requirements of the preceding Articles, submit the following: a. Proof of the affiliation of at least 10 locals or chapters, each of which must be a duly recognized collective bargaining agent in the establishment or industry in which it operates, supporting the registration of such applicant federation or national union; and
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b.
The names and addresses of the companies where the locals or chapters operate and the list of all the members in each company involved.
NOTE: Creation of a Local Chapter does not need subscription of at least 20% of the members. Coastal Subic Bay Terminal v. DOLE The Regional Offices of the DOLE and the BLR have jurisdiction over applications for registration by labor organizations. Even after the amendments, the rules did not divest the Regional Office and the BLR of their jurisdiction over applications for registration by labor organizations. The amendments to the implementing rules merely specified that when the application was filed with the Regional Office, the application would be acted upon by the BLR. San Miguel Corp. Employees Union-PTGWO v. San Miguel Packaging Products Employees Union-PDMP 2007) The applicable Implementing Rules enunciates a two-fold procedure for the creation of a chapter or local. o (1) First involves the affiliation of an independent union with a federation or national union or industry union. o (2) Second, involves the direct creation of a local or chapter. When an unregistered union becomes a branch, local or chapter, some of the aforementioned requirements for registration are no longer necessary or compulsory. Example: Whereas an applicant for registration of an independent union is mandated to submit, among other things, the number of employees and names of all its members comprising at least 20% of the employees in the bargaining unit where it seeks to operate, as provided under Art. 234 of the Labor Code and Section 2 of Rule III, Book V of the Implementing Rules, the same is no longer required of a branch, local or chapter. Philippine Association of Free Labor Unions v Sec. of Labor (1969) The theory to the effect that Section 23 of Republic Act No. 875 unduly curtails
the freedom of assembly and association guaranteed in the Bill of Rights is devoid of factual basis. The registration prescribed in paragraph (b) of said section is not a limitation to the right of assembly or association, which may be exercised with or without registration. The latter is merely a condition sine qua non for the acquisition of legal personality by labor organizations, associations or unions and the possession of the rights and privileges granted by law to legitimate labor organizations. The Constitution does NOT guarantee these rights and privileges much less said personality, which are mere statutory creations, for the possession and exercise of which registration is required to protect both labor and the public against abuses, fraud, or impostors who pose as organizers, although not truly accredited agents of the union they purport to represent. Such requirement is a valid exercise of police power, because the activities in which labor organization, associations and unions of workers are engaged affect public interest, which should be protected. Denial of
LABOR RELATIONS
2. Action on Application; Registration
Art. 235: Action on Application 1) The Bureau shall act on all applications for registration within 30 days from filing. 2) All requisite documents and papers shall be certified under oath by the secretary or the treasurer of the organization, as the case may be, and attested to by its president. ART 236: Denial of Registration; Appeal The decision of the Labor Relations Division in the regional office denying registration may be appealed by the applicant union to the Bureau within 10 days from receipt of notice thereof.
Progressive Developmentt Corporation Pizza Hut v. Laguesma (1997) Recognition of a labor org as a legitimate labor org upon the filing of the necessary papers is NOT a ministerial function. Mandatory that BLR checks if the requirements of Art.234 was complied with.
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The requirements embodied therein are intended as preventive measures against the commission of fraud. Registration requirements specifically afford a measure of protection to unsuspecting employees who may be lured into joining unscrupulous or flyby-night unions whose sole purpose is to control union funds or use the labor organization for illegitimate ends. IF its application for registration is vitiated by falsification and serious irregularities, a labor org should be denied recognition. It was stated in this case that the propriety of registration of a labor organization can be both directly and collateraly attacked. THIS IS NO LONGER APPLICABLE. In Tagaytay Highlands International Golf Club, Inc. vs. Tagaytay Highlands Employees Union-PGTWO (G. R. No. 142000, January 22, 2003), the Supreme Court ruled that the effect of issuance of certificate of registration to a union is that it becomes legitimate and its legal personality can only be attacked through a petition for cancellation of registration and not thru intervention in a certification election petition. Registration; Non-
(1) DO No. 9: The local/chapter acquires legal personality from the date of the filing of the complete documentary requirements, and NOT from the issuance of a certification to such effect by the Regional Office or Bureau. (2) DO No. 40: A local/chapter (or now, chartered local) acquires legal personality upon the issuance of the charter certificate by the duly registered federation or national union. DO No. 40 also requires that the federation or national union report the creation of the chartered local to the Regional Office.
LABOR RELATIONS
Tropical Hut Employees Union v Tropical Hut Food Market Inc. (1990) When the local/chapter disaffiliated from its mother federation, the former did not lose its legal personality as the bargaining union under the CBA. A perusal of the CBA shows that the local/chapter and not mother federation was recognized as the sole and exclusive bargaining agent for all its workers and employees in all matters except for the check-off authorization. Mother federation possessed the status of a mere agent while the union was still the principal that entered the contract with the company. 4. Rights of Organization
ART 242: Rights Organizations
3. Effect of registration,
Legitimate
Labor
San Miguel Corp. v. Mandaue Packaging Products Plant (2005) In the last decade or so, significant amendments have been introduced to Book V, first by DO No. 9 which took effect on 21 June 1997, and again by DO No. 40 dated 17 February 2003. The differences in the procedures laid down in these various versions are significant. As regards independent labor organizations, both DO No. 9 and DO No. 40 provides that a labor organization is deemed to have acquired legal personality only on the date of issuance of its certificate of registration. As regards locals/chapters:
of
Legitimate
Labor
1. To act as the Representative of its members for the purpose of collective bargaining; 2. To be certified as the exclusive representative of all the employees in an appropriate collective bargaining unit for purposes of collective bargaining; 3. To be furnished by the employer, upon written request, with its annual audited financial statements; 4. To own property, real/personal, for use and benefit of the labor organization and its members; 5. To sue and be sued in its registered name; 6. To undertake all activities designed to benefit the organization and its members not contrary to law; and
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7.
Income, properties, grants, endowments, gifts, donations, and contributions used for their lawful purposes shall be FREE from Taxes, Duties, and Assessments, except when this provisions is expressly repealed by a special law.
B. CANCELLATION OF UNION CERTIFICATE OF REGISTRATION

ART 238 Cancellation of Registration 1) The certificate of registration of any legitimate labor organization, whether national or local, may be cancelled a. by the Bureau, b. after due hearing, c. only on the grounds specified in Article 239 hereof. ART 238-A: Effect of a Petition for Cancellation of Registration 1) A petition for cancellation of union registration shall not suspend the proceedings for certification election nor shall it prevent the filing of a petition for certification election. 2) In case of cancellation, nothing herein shall restrict the right of the union to seek just and equitable remedies in the appropriate courts. ART 239. Grounds for Cancellation of Union Registration 1) Misrepresentation, false statement or fraud in connection with the adoption or ratification of the constitution and bylaws or amendments thereto, the minutes of ratification, and the list of members who took part in the ratification; 2) Misrepresentation, false statements or fraud in connection with the election of officers, minutes of election of officers, and list of voters; 3) Voluntary dissolution by the members NOTE: Last Par. of ART 241(j): Failure of any labor organization to comply with the periodic financial reports required by law and such rules and regulations promulgated thereunder 6 months after the effectivity of this Act shall automatically result in the cancellation of union registration of such labor organization.
ART. 242-A: Reportorial Requirements 1) The legitimate labor organization shall submit the following documents to the Bureau of Labor Relations (BLR): a) Its constitution and by-laws, or amendments thereto, the minutes of ratification, and the list of members who took part in the ratification of the constitution and by-laws within 30 days from adoption or ratification of the constitution and by-laws or amendments thereto; b) Its list of officers, minutes of the election of officers, and list of voters within 30 days from election; c) Its annual financial report within 30 days after the close of every fiscal year; and d) Its list of members at least once a year or whenever required by the Bureau. 2) Failure to comply with the above requirements shall not be a ground for cancellation of union registration but shall subject the erring officers or members to suspension, expulsion from membership, or any appropriate penalty. Acedera v International Container Services (2003) A union may act as the representative of its members for the purpose of collective bargaining. This authority includes the power to represent its members for the purpose of enforcing the provisions of the CBA. While a party acting in a representative capacity, such as a union may be permitted to intervene in a case, ordinarily, a person whose interests are already represented will not be permitted to do the same except when there is a suggestion of fraud or collusion or that the representative will not act in good faith for the protection of all interests represented by him.
LABOR RELATIONS
V. INTERNATIONAL ACTIVITIES OF UNION: PROHIBITION AND REGULATION

General Rule: (Art. 269) Aliens, natural/juridical, as well as foreign organizations, are strictly prohibited from engaging directly/indirectly in all forms of trade union activities. Exceptions: (Art. 269) a. Aliens working in the country with valid permits issued by the DOLE, b. may exercise the right to self-organization and join or assist a labor organization of their own choosing for purposes of collective bargaining.
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c.
Said aliens are nationals of a country which grants the same or similar rights to Filipino workers.
Note: Aliens cannot create a labor organization. -Please check Ch. 2 D for the discussion on Art. 270.
Art. 271: Applicability to Farm Tenants and Rural Workers The provisions of this Title pertaining to foreign organizations and activities shall be deemed applicable to all organizations of farm tenants, rural workers, and the like: PROVIDED, that in appropriate cases, the Secretary of Agrarian Reform shall exercise the powers and responsibilities vested by this Title in the Secretary of Labor.
2. Election of Officers; Qualifications; Manner of Election; Tenure and Compensation a. Qualifications Membership in Good Standing (ART. 241(c)) Must not have been convicted of any crime involving moral turpitude (ART. 241 (f)) b. Manner of Election (ART. 241(c)) Members shall directly elect their officers By Secret Ballot At intervals of 5years c. Tenure (ART. 241(c): 5 years 3. Compensation a. General Rule: NONE b. Except: If specifically provided by their CBA, or allowed by written resolution duly authorized by majority of all members in a general membership meeting duly called for the purpose.
Art. 241(k): Rights and Conditions of Membership in a Labor Organization 1) The minutes of the meeting and the list of participants and ballots cast shall be subject to inspection by the Secretary of Labor or his duly authorized representatives. 2) Any irregularities in the approval of the resolutions shall be a ground for impeachment or expulsion from the organization
LABOR RELATIONS
VI. UNION-MEMBER RELATIONS

Art. 3: Declaration of Basic Policy The State shall xxx regulate the relations between workers and employers.
A. NATURE OF RELATIONSHIP B. ISSUES AND CONCERNS 1. Admission and Discipline of Members

Art. 249: Unfair Labor Practices of Labor Organizations It shall be unfair labor practice for labor organizations, its officers, agents or representatives: 1) To restrain or coerce employees in the exercise of their rights to self-organization. 2) However, a labor organization shall have the right to prescribe its own rules with respect to the acquisition or retention membership. Art. 241: Rights and Conditions of Membership in a Labor Organization 1) No arbitrary or excessive initiation fees shall be required of the members of a legitimate labor organization; 2) Nor shall arbitrary, excessive or oppressive fine and forfeiture be imposed. 3) No labor organization shall knowingly admit as members or continue in membership any individual who belongs to a subversive organization or who is engaged directly or indirectly in any subversive activity. Art 277: Miscellaneous Provisions (c) Any employee, whether employed for a definite period or not, shall, beginning on his first day of service, be considered an employee for purposes of membership in any labor union.
Union Election vs. Certification Election 1) Union Election Election of officers of union; only members can participate. 2) Certification Election Election of sole and exclusive bargaining agent (SEBA) of the employees in an appropriate bargaining unit; all employees belonging to the appropriate bargaining unit can participate. Disqualification of Candidate
Manalad vs. Trajano, (1989): If a candidate is proven to be disqualified, it does not mean that the candidate with the 2nd highest number of votes becomes the elected officer.
Expulsion Remedy
Kapisanan ng Manggagawang Pinagyakap vs. Trajano, (1985): 1) If union officers were guilty of the alleged acts imputed, 2) BLR pursuant to Art. 242 should have meted out the appropriate penalty on them, i.e., to expel them from the Union, as prayed for, and 3) not call for a referendum to decide the issue.
Election Invalid
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Rodriguez vs. Director, (1988): 1) Free and honest elections are indispensable to the enjoyment by employees and workers of their constitutionally protected right to self-organization. 2) If attended by grave irregularities election should therefore be declared invalid.
4. Major Policy Matter ART. 241 (d): Rights and Conditions of Membership in a Labor Organization
The members shall determine by secret ballot, after due deliberation, any question of major policy affecting the entire membership of the organization, unless the nature of the organization or force majeure renders such secret ballot impractical, in which case the board of directors of the organization may make the decision in behalf of the general membership.
5. Union Funds: Payment of Attorneys Fees and Special Assessment

ART. 241: Rights and Conditions of Membership in a Labor Organization (b) Full and detailed financial transaction reports; (g) Collection of any fees, dues or other contributions; (h) Payment of fees, dues or other contributions by member shall be evidenced by a receipt signed by the officer or agent making the collection and entered into the record of the organization; (i) Funds of the organization shall not be applied for any purpose or object: other than those expressly provided by the CBL or authorized by written resolution adopted by the majority of the members at general meeting duly called for the purpose; (j) Every income or revenue of the organization shall be evidenced by a record showing its source, and every expenditure of its funds shall be evidenced by a receipt; (l) The treasurer shall render account (duly audited and verified by affidavit and a copy thereof shall be furnished the Secretary of Labor); 1) At least once a year within 30 days after the close of its fiscal year; 2) At such other times as may be required by a resolution of the majority of the members of the organization; and 3) Upon vacating his office; (m) Books of accounts and other records of the financial activities of any labor organization shall be open to inspection by any officer or member thereof during office hours; (n) No special assessment or other extraordinary fees may be levied upon the members of a labor organization unless authorized by a written resolution of a majority of all the members of a general
membership meeting duly called for the purpose; (o) Other than for mandatory activities under the Code, no special assessments, attys fees, negotiation fees or any other extraordinary fees may be checked off from any amount due to an employee w/o an individual written authorization duly signed by the Employee. The authorization should specifically state the amount, purpose and beneficiary of the deduction; (p) No special assessment or other extraordinary fees may be levied upon the members of a labor organization unless authorized by a written resolution of a majority of all the members of a general membership meeting duly called for the purpose; and (q) Other than for mandatory activities under the Code, no special assessment, atty.s fees, negotiation fees or any other extraordinary fees may be checked off from any amount due to an employee without an individual written authorization duly signed by the Employee. Art. 222: Appearances and Fees 1) 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. 2) However, attorneys fees may be charged against union funds in an amount to be agreed upon by the parties. 3) Any contract, agreement or arrangement of any sort to the contrary shall be null and void. ART 274: Visitorial Power 1) The Sec of Labor or his duly authorized representative is hereby empowered to inquire into the financial activities of legitimate labor organizations 2) Upon the filing of a complaint under oath and duly supported by the written consent of at least 20% of the total membership of the labor organization concerned 3) And to examine their books of accounts and other records to determine compliance or non-compliance with the law 4) And to prosecute any violations of the law and the union constitution and by-laws; 5) Provided, that such inquiry or examination shall not be conducted during the 60-day freedom period nor within the 30 days immediately preceding the date of election of union officials.
LABOR RELATIONS
Three requisites for the validity of the special assessment for the unions incidental expenses (ART. 241(n)) a. Authorization by written resolution of majority of ALL the members at the general membership meeting called for that purpose;
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b. Secretarys record of the minutes of the meetings attested to by the president; c. Individual written authorization for check-off duly signed by the employees concerned. 6. Mandatory Activity (See Art. 241 (o))
Vengco vs. Trajano, 1989: a) Judicial process of settling disputes laid down by the law. Amicable settlements cannot be considered as a mandatory activity; b) Art 241(o) envisions a situation where there is a judicial or administrative proceeding for recovery of wages.
Exhaustion of Internal Remedies

Villar vs. Inciong, (1983): 1) When members of a labor union sow the seeds of dissension and strife within the union, when they seek the disintegration and destruction of the very union to which they belong, they forfeit their rights to remain as members. 2) The union has right to expel erring members in accordance to their CBL. 3) Redress must be first sought within the union itself.
Exceptions
Kapisanan vs. Hernandez (1985): 1) Futility of intra-union remedies; 2) Improper expulsion procedure; 3) Undue delay in appeal as to constitute substantial injustice; 4) When the action is for damages; 5) Lack of jurisdiction of the investigating body; 6) When the action of the administrative agency is patently illegal, arbitrary and oppressive; 7) Pure questions of law; 8) When the administrative agency has already prejudged the case; and 9) Where the admin agency was practically given an opportunity to act on the case
LABOR RELATIONS
7. Union Information
Art. 241: Rights and Conditions Membership in a Labor Organization of
(p) It shall be the duty of any labor organization and its officers to inform its members on: 1) Provisions of its constitution and by-laws, 2) Collective bargaining agreement, 3) Prevailing labor relations system, and 4) All their rights and obligations under existing labor laws.
8. Enforcement and Remedies; Prcedure and Sanctions ART 241: Rights and Conditions of
Membership in a Labor Organization Criminal and civil liabilities arising from violations of the above rights and conditions of membership shall continue to be under the jurisdiction of ordinary courts. ART 226: Bureau of Labor Relations 1) The Bureau of Labor Relations and Labor Relations Division in the regional offices of the Department of Labor shall have original and exclusive authority to act, at their own initiative or upon request of either or both parties, on all inter-union and intra-union conflicts, and all disputes, grievances or problems arising from or affecting labor-management relations in all workplaces whether agricultural or non-agricultural, EXCEPT those arising from the implementation or interpretation of collective bargaining agreements which shall be the subject of grievance procedure and/or voluntary arbitration. The Bureau shall have fifteen (15) working days to act on labor cases before it, subject to extension by agreement of the parties.
but did not.
VII. UNION AFFILIATION: LOCAL AND PARENT UNION RELATIONS

A. AFFILIATION: PURPOSE NATURE OF RELATIONS AND
ART 211: Declaration of Policy (c) To foster the free and voluntary organization of a strong and united labor movement
Purpose
Phil. Skylanders vs. NLRC, (2002): 1) The sole essence of affiliation is to increase by collective action, the common bargaining power of local unions for the effective enhancement and protection of their interests. 2) Admittedly, there are times when without succor and support local unions may find it hard, unaided by other support groups, to secure justice for themselves.
2) 3)
4)
Nature of Relationship
Filipino Pipe and Foundry Corp vs. NLRC, (1999): 1) The mother union, acting for and in behalf of its affiliate, had the status of an agent 2) while the local remained the basic unit of the association, free to serve the common interest of all its members,
5)
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3) 4)
subject only to restraints imposed by the constitution and by the by-laws of the association. The same is true even if the local is not a legitimate labor organization.
Effect of Affiliation Adamson and Adamson, Inc. vs. CIR, (1984): 1) Locals remain the basic units of association, free to serve their own and the common interest of all. 2) Inclusion of FFW in the registration is merely to stress that they are its affiliates at the time of registration. 3) It does not mean that said local unions cannot stand on their own. 4) Affiliation does not mean they lost their own legal personality. 1. Independent Union/Local Union Book V Rule 1 Sec. 1 (w) Independent Union a labor organization operating at the enterprise level that required legal personality through independent registration under Art. 234 of the Labor Code and Rule III Sec. 2-A of the IRR. 2. Chartered Local (Local Chapter) Book V Rule 1 Sec. 1 (i) Chartered Local a labor organization in the private sector operating at the enterprise level that acquired legal personality through the issuance of a charter certificate by a duly registered federation or national union, and reported to the Regional Office in accordance with Rule III Sec. 2-E of the IRR. 3. Affiliate Book V Rule 1 Sec. 1 (a) Affiliate an independent union affiliated with a federated, national union or a chartered local which was subsequently granted independent registration but did not disaffiliate from its federation, reported to the Regional Office and the Bureau in accordance with Rule III Secs. 6 and 7 of the IRR. 4. National Union or Federation Book V Rule 1 Sec. 1 (kk) National Union or Federation a group of legitimate labor unions in a private establishment organized for collective bargaining or for dealing with employers concerning terms and conditions of
employment for their member union or for participating in the formulation of social and employment policies, standards and programs, registered with the BLR in accordance with Rule III Sec. 2-B of the IRR. B. SUPERVISOR/RANK AND FILE UNION AFFILIATION
ART 245. Ineligibility of managerial employees to join any labor organization; right of supervisory employees Managerial employees are not eligible to join, assist or form any labor organization. Supervisory employees shall not be eligible for membership in a labor organization of the rank and file employees but may join, assist or form separate labor organizations of their own.
LABOR RELATIONS
-See Art. 243 in Ch. 2. ART 245-A. Effect of Inclusion as Members of Employees outside the Bargaining Unit The inclusion as members of employees outside the bargaining unit shall not be a ground for the cancellation of the registration of the union. Said employees are automatically deemed removed from the list of membership of said union. C. LOCAL UNION DISAFFILIATION/ MASS DISAFFILIATION Nature of Right of Disaffiliation Malayang Samahan ng mga Manggagawa vs. Ramos, (2000): 1) A local union, being a separate and voluntary association, is free to serve the interests of all its members. 2) It has the right to disaffiliate or declare its autonomy from the federation to which it belongs when circumstances warrant, 3) in accordance with the constitutional guarantee of freedom of association, and such disaffiliation cannot be considered disloyalty. Tropical Hut Employees Union vs. Tropical Hut Food Market, Inc (1990): 1) The locals are separate and distinct units primarily designed to secure and maintain an equality of bargaining power between the employer and their employee-members;
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2) and the association of the locals into the national union was in furtherance of the same end. 3) These associations are consensual entities capable of entering into such legal relations with their member. 4) The essential purpose was the affiliation of the local unions into a common enterprise to increase by collective action the common bargaining power in respect of the terms and conditions of labor. Phil. Skylanders Inc vs. NLRC, (2002): 1) Local Unions remain the basic units of association, 2) free to serve their own interests subject to the restraints imposed by the constitution and by-laws of the national federation, and 3) free also to renounce the affiliation upon the terms laid down in the agreement which brought such affiliation into existence. D. PERIOD
B. VALIDITY AGREEMENT AND EFFECT ON FREEDOM OF CHOICE; TYPES OF UNION SECURITY PROVISIONS 1. Validity of Agreement
Tanduay Distillery Labor Union vs. NLRC (1987): 1) As a matter of principle the provision of the industrial peace act granting freedom to employees to organize themselves and select their representative for entering into bargaining agreements, 2) should be subordinated to the constitutional provision protecting the sanctity of contracts. 3) And even if the legislature had intended to do so and made such freedom of the laborer paramount to the sanctity of the obligation of contracts, 4) such attempt to override the constitutional provision would necessarily and ipso fact be null and void.
LABOR RELATIONS
2. Union Shop vs. Membership Shop
Maintenance
of
VIII. UNION SECURITY

A. STATUTORY BASIS AND RATIONALE
ART 248 (e). Unfair Labor Practices of Employers 1) Nothing in this Code or in any other law shall stop the parties from requiring membership in a recognized collective bargaining agent as a condition for employment, EXCEPT those employees who are already members of another union at the time of the signing of the collective bargaining agreement. Employees of an appropriate collective bargaining unit who are not members of the recognized collective bargaining agent may be assessed a reasonable fee equivalent to the dues and other fees paid by members of the recognized collective bargaining agent, if such non-union members accept the benefits under the collective agreement: Provided, that the individual authorization required under Article 242 (o) of this Code shall not apply to non-members of the recognized collective bargaining agent.
Alabang Country Club, Inc. vs. NLRC, (2008): 1) There is Union Shop when all new regular employees are required to join the union within a certain period as a condition for their continued employment. 2) There is Maintenance of Membership Shop when employees who are union members as of the effective date of the agreement, or who thereafter become members, must maintain union membership as a condition for their continued employment until they are promoted or transferred out of the bargaining unit or the agreement in terminated.
2)
3)
4) 5)
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3. Art. 248:
Hiring Union Shop Employees have access to labor market. Can be hired even if not union member Continued Employment After some time, employee must become a member Ground for termination If the employee does not join the union after a reasonable time, it will be grounds for termination, after due process is observed If not a member at anytime, grounds for termination, after due process is observed If disaffiliates from union, grounds for termination, after due process is observed
LABOR RELATIONS
Closed Shop
Employee must become a member at the time of hiring
Must be a member all through-out
Maintenance Shop
Already a member at the time of hiring
Must maintain membership, otherwise it shall be a ground for termination 2)
C. COVERAGE: WORKER AND EXCLUSION

ART 248 (e): Employers Unfair Labor
INCLUSION
Practices of
3)
if it merely complied in good faith with the request of the certified union for the dismissal of employees expelled from the union pursuant to the union security clause in the CBA.
Nothing in this Code or in any other law shall stop the parties from requiring membership in a recognized collective bargaining agent as a condition for employment, EXCEPT those employees who are already members of another union at the time of the signing of the collective bargaining agreement.
1. Rationale CLOSED SHOP The requirement for employees or workers to become members of a union as condition for employment redounds to the benefit and advantage of said employees because by holding out to loyal members a promise of employment in the closed-shop the union wields group solidarity. In fact it is said that the closed-shop contract is the most prized achievement of unionism. 2. To Whom a Closed-Shop Proviso Applicable Employees or laborers that are employed after the CBA was entered into; Employees who are not members of any labor union at the time the said CBA was entered into. D. IMPLEMENTATION: OBLIGATION AND LIABILITIES
Olvido vs. CA, (2007): 1) The employer is not considered guilty of ULP
Malayang Samahan ng mga Manggagawa vs. Ramos, (2000): 1) Although union security clauses embodied in the CBA may be validly enforced and dismissals pursuant thereto may likewise be valid, 2) this does not erode the fundamental requirement of due process. 3) The reason behind the enforcement of union security clauses which is the sanctity and inviolability of contracts cannot override ones right to due process.
E. FINANCIAL SECURITY: SHOP AND CHECK-OFF
AGENCY
ART 113. Wage Deduction 1) No employer, in his own behalf or in behalf of any person shall make any deduction from wages of his employees, 2) EXCEPT: (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. (See also ART 248(e))
National Brewery v. San Miguel Brewery Inc, (1963): 1) If a closed-shop agreement cannot be applied to employees who are already in the service and are members of another union, 2) neither may any agency fee, as a lesser form of union security, be imposed upon them.
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Chapter 4. The Appropriate Bargaining Unit

I. Definition and Role of Law II. Determination of Appropriate Bargaining Unit A. Factors in Unit Determination 1.Community and Mutuality of Interests 2. History 3. Geography Location B. Unit Severance and Globe Doctrine C. Effect of Prior Agreement III. Determining Agency, Arts. 226, 232
II. DETERMINATION OF APPROPRIATE BARGAINING UNIT

A. FACTORS-UNIT DETERMINATION UP v. Ferrer-Calleja (1992) citing Democratic Labor Assoc v. Cebu Stevedoring Co: (W-AP-E) 1) Will of the Employees 2) Affinity & unity of Employees interest, such as substantial similarity of works and duties or similarity of compensation & working conditions 3) Prior CB history 4) Employment status i.e. temporary, seasonal, & probationary 1. COMMUNITY INTERESTS or MUTUALITY of
I. DEFINITION AND ROLE OF LAW

Art 255: Exclusive Bargaining and workers participation in the policy and decision making a) The labor organization designated or selected by the majority of the employees in an appropriate collective bargaining unit b) shall be the exclusive representative of the employees in such a unit for the purpose of collective bargaining. c) However, an individual employee or group of employees shall have the right at any time to present grievances to their employer. d) Any provision of law to the contrary notwithstanding, workers shall have the right, to participate in the policy and decision-making processes of the establishment e) where they are employed insofar as said processes will directly affect their rights, benefits and welfare. f) For this purpose, workers and employers may form labor-management councils: g) Provided, that the representatives of the workers in such labor-management councils shall be elected by at least the majority of all employees in said establishment. Book V, Rule 1, Sec1(d) Definition of TermsBargaining Unit refers to a group of employees sharing mutual interests within a given employer unit, comprised of all or less than all of the entire body of employees in the employer unit or any specific occupational or geographical grouping within such employer unit.
LABOR RELATIONS
UP v. Ferrer-Calleja (1992): [T]he basic test of an asserted bargaining units ACCEPTABILITY is whether or not it is fundamentally the combination which will best assure to all Employees the exercise of their CB rights. This is related to the policy of the law in ensuring the right to collective bargain. There can be no permanent bargaining unit as an appropriate bargaining unit depends on the factors that are influenced by the market place. The bargaining unit is designed to maintain the mutuality of interest among the employees in such unit.
Reason to dissolve, change or expand a certain bargaining unit: When THE INTEREST BETWEEN GROUPS HAS CHANGED OVER TIME.
2. HISTORY San Miguel Corp. v. Laguesma, 1994: [T]he existence of a prior collective bargaining history is neither decisive nor conclusive in the determination of what constitutes an appropriate bargaining unit. 3. GEOGRAPHY LOCATION Benguet Consolidated Inc. and Balatok Mining Co. v. Bobok Lumberjack Assn. (1958): Geography and location only play a significant role if: 1. the separation between the camps and the different kinds of work in each all
Belyca Corp. vs Calleja, (1988): 1) A group of employees of a given employer comprised of all or less than all of the entire body of employees, 2) which the collective interests of all the employees indicate to be best suited to serve reciprocal rights and duties of the parties consistent with equity to the employer.
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militate in favor of the system of separate bargaining units; 2. when the problems and interests of the workers are peculiar in each camp or department; 3. the system of having one collective bargaining unit in each camp has operated satisfactorily in the past. 4. SIZE - COMPOSITION
Phil. Diamond Hotel and Resort Inc v Manila Diamond Hotel and Employees Union (2006): It bears noting that the goal of the DOLE is geered towards "a single employer wide unit which is more to the broader and greater benefit of the employees working force." The philosophy is to avoid fragmentation of the bargaining unit so as to strengthen the employees bargaining power with the management. To veer away from such goal would be contrary, inimical and repugnant to the objectives of a strong and dynamic unionism.
a. To vote for Unit A: this would mean that they do not wish to separate from the original bargaining unit. b. To vote for Unit B: This would mean that they would want to form their OWN bargaining unit, composed of pilots only. c. Neither: They do not want the choices d. If you have one BIG bargaining unit, most probably you are grouping together DIFFERENT SKILLED workers. 3. Size of Unit and Effect on Right to Self-Organization Filoil Refinery Corp. v Filoil Supervisory and Confidential Employees Union (1972): 1) Since the confidential employees are very few in number and are by practice and tradition identified with the supervisors in their role as representatives of management vis--vis the rank and file employees, 2) such identity of interest has allowed their inclusion in the bargaining of supervisors for purposes of collective bargaining in turn as employees in relation to the company as their employer. 3) This identity of interest logically calls for their inclusion in the same bargaining unit 4) and at the same time fulfills the laws objective of insuring to them the full benefit of their right to self organization and to collective bargaining, 5) which could hardly be accomplished if the respondent associations membership were to be broken up into five separate ineffective tiny units. 6) Creating fragmentary units would not serve the interest of industrial peace. The breaking up of bargaining units into tiny units will greatly impair their organizational value. 4. SUPERVISOR UNIT Dunlop Slazenger v. NLRC, (1998): Supervisors can be an appropriate bargaining unit.
LABOR RELATIONS
B. UNIT SEVERANCE DOCTRINE
AND
GLOBE
1. Concept: Kapisanan ng mga Manggagawa sa Manila Road Co. v. Yard Crew Union (1960): [A] practice designated as the "Globe doctrine," which sanctions the holding of a series of elections, not for the purpose of allowing the group receiving an over all majority of votes to represent all employees, but for the specific purpose of permitting the employees in each of the several categories to select the group which each chooses as a bargaining unit Rationale: Highly skilled workers have to separate to increase their market value. It is best explained in the context of a market place and the demand of employment on such market place. The GLOBE DOCTRINE usually applies to employees with rare skills or highly technical ones. 2. (DISINI NOTES)Illustration: 1) The pilots and stewardesses of S.P. Airlines belong to one bargaining unit (UNIT A). 2) Suppose the pilots desired to have a bargaining unit of their own (UNIT B). 3) Applying the Globe Doctrine, a plebiscite shall be conducted among the pilots to ascertain their will. The choices will be:
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5. Principles In Determining Whether To Establish Separate Bargaining Units: Indophil Textile Mills Workers Union v. Calica, (1992); Diatagon Labor Federation v. Ople, (1980): 1. The existence of a bonafide business relationship between the 2 companies is not proof of being a single corporate entity, especially when the services provided by the other company are merely auxiliary. 2. The fact that there are as many bargaining units as there are companies in a conglomeration of companies is a positive proof that a corporation is endowed with a legal personality DISTINCTLY ITS OWN, independent and separate from other corporations. 3. Separate legitimate purposes militate against treating one corporation as an adjunct or alter ego of the other. 4. The fact that the businesses are related, that some of the employees are the same persons working in the other company and the physical plants, offices and facilities are in the same compound are NOT sufficient to justify piercing the corporate veil. In Umali vs CA, legal corporate entity is disregarded only if it is sought to hold the officers and stockholders directly liable for a corporate debt or obligation. Phil. Scouts Veterans v. Torres, (1993): Determine who exercises supervision and control. 1) whether different management terms 2) enforcement of administrative and operational rules 3) maintenance of financial statements and auditing 4) cross-linking of command, control and communication systems . San Miguel .Union v Confesor, (1996): 1. The transformation of companies is a management prerogative and business judgment which the courts cannot look into unless it is contrary to law, public policy or morals. 2. If, considering the spin-offs, the companies would consequently have their respective and distinctive concerns in terms of nature of work, wages, hours of work and other conditions of employment.
3. The nature of their products and scales of business may require different skills, volumes of work, and working conditions which must necessarily be commensurate by different compensation packages. C. EFFECT OF PRIOR AGREEMENT General Rubber & Footwear Corp. v BLR, 1987): Rule: Prior agreement as to the inclusion or exclusion of workers in a bargaining unit or prohibition from forming their own union agreed upon by the corporation with the previous bargaining representatives can never bind subsequent federations DLSU v. DLSUEA, (2000): Rationale: It is a curtailment of the right to self-organization. During the freedom period, the parties may not only renew the existing collective bargaining agreement but may also propose and discuss modifications or amendments thereto. CORPORATE ENTITIES
LABOR RELATIONS
Doctrine: It is grave abuse of discretion to treat 2 companies as a single bargaining unit when these 2 companies are indubitably distinct entities with separate juridical personalities.
III.DETERMINING AGENCY
Art 226: Bureau of Labor Relations 1) The Bureau of Labor Relations and the regional offices of the Department of Labor, 2) shall have original and exclusive authority to act, at their own initiative or upon request of either or both parties 3) on all inter-union and intra-union conflicts, and all disputes, grievances or problems arising from or affecting labor-management relations in all workplaces, whether agricultural or non-agricultural, 4) EXCEPT: those arising from the implementations or interpretation of collective bargaining agreements which shall be the subject of grievance procedure and/ or voluntary arbitration. 5) The Bureau shall have 15 working days to act on labor cases before it, subject to extension by agreement of the parties. Art 232: General Rule: The Bureau shall not entertain any petition for certification election or any other action which may disturb the administration of
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duly registered existing collective bargaining agreements affecting the parties Exceptions: Art. 253, 253-A and 256 of this Code. Art. 253. Duty to bargain collectively when there exists a collective bargaining agreement. When there is a collective bargaining agreement, the duty to bargain collectively shall also mean that neither party shall terminate nor modify such agreement during its lifetime. However, either party can serve a written notice to terminate or modify the agreement at least sixty (60) days prior to its expiration date. It shall be the duty of both parties to keep the status quo and to continue in full force and effect the terms and conditions of the existing agreement during the 60-day period and/or until a new agreement is reached by the parties. Art. 253-A. Terms of a collective bargaining agreement. Any Collective Bargaining Agreement that the parties may enter into shall, insofar as the representation aspect is concerned, be for a term of five (5) years. No petition questioning the majority status of the incumbent bargaining agent shall be entertained and no certification election shall be conducted by the Department of Labor and Employment outside of the sixtyday period immediately before the date of expiry of such five-year term of the Collective Bargaining Agreement. All other provisions of the Collective Bargaining Agreement shall be renegotiated not later than three (3) years after its execution. Any agreement on such other provisions of the Collective Bargaining Agreement entered into within six (6) months from the date of expiry of the term of such other provisions as fixed in such Collective Bargaining Agreement, shall retroact to the day immediately following such date. If any such agreement is entered into beyond six months, the parties shall agree on the duration of retroactivity thereof. In case of a deadlock in the renegotiation of the Collective Bargaining Agreement, the parties may exercise their rights under this Code. Art. 256. Representation issue in organized establishments. In organized establishments, when a verified petition questioning the majority status of the incumbent bargaining agent is filed before the Department of Labor and Employment within the sixty-day period before the expiration of the collective bargaining agreement, the Med-Arbiter shall automatically order an election by secret ballot when the verified petition is supported by the written consent of at least twenty-five percent (25%) of all the employees in the bargaining unit to ascertain the will of the employees in the appropriate bargaining unit. To have a valid election, at least a majority of all eligible voters in the unit must have cast their votes. The labor union receiving the majority of the valid votes cast shall be certified as the exclusive bargaining agent of all the workers in the unit. When an election which provides for
three or more choices results in no choice receiving a majority of the valid votes cast, a run-off election shall be conducted between the labor unions receiving the two highest number of votes: Provided, that the total number of votes for all contending unions is at least fifty percent (50%) of the number of votes cast. At the expiration of the freedom period, the employer shall continue to recognize the majority status of the incumbent bargaining agent where no petition for certification election is filed.
AGENCY AND FINALITY ORDER Filoil Refinery Corp. v Filoil Supervisory and Confidential Employees Union (1972): 1) Industrial court enjoys a wide discretion in determining the procedure necessary to insure the fair and free choice of bargaining representations by employees. 2) Its action in deciding upon an appropriate unit for collective bargaining purpose is discretionary. 3) Its judgment in this respect is entitled to almost complete finality, unless its action is arbitrary or capricious and that absent any grave abuse of discretion as to justify the Courts intervention.
LABOR RELATIONS
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Chapter 5. Union Representation

I. PRE-CONDITION: EMPLOYER-EMPLOYEE RELATIONSHIP II. METHODS OF ESTABLISHING MAJORITY STATUS III. CERTIFICATION ELECTION A. Employee as initiating partyin organized and unorganized establishments: B. Employer as initiating party C. Responsible agency D. Requisite for validity of election E. Nature of proceeding/ effect of private agreement F. Election process and procedure 1. Petition for Certification Election a. Who may file b. Where to file c. When to file d. Forced Intervenor e. Motion for Intervention f. Preliminary Conference; hearing g. Order 2. Certification Election Mechanics a. Posting of Notice b. Voting List and Voters c. Voting Day d. Protest e. Appeal from Certification Election f. Annulment G. Certification of designated majority union H. Bars to certification election 1. One-Year Bar Rule 2. Negotiation Bar Rule 3. Contract Bar Rule 4. Deadlock Bar Rule I. Suspension of certification election J. Effect of petition for cancellation of union registration
II. METHODS OF ESTABLISHING MAJORITY STATUS

A. VOLUNTARY RECOGNITION Book V, Rule 1, Sec 1 (bbb) Definition of Terms. Voluntary Recognition refers to the process by which a legitimate labor union is recognized by the employer as the exclusive bargaining representative or agent in a bargaining unit, reported with the Regional office in accordance to Rule VII, Sec 2 of these Rules.
LABOR RELATIONS
Conditions: 1) Unorganized establishment; 2) Only one union asking for recognition; 3) The members of the bargaining unit did not object to the projected recognition of the union.
I. PRE-CONDITION: EMPLOYEREMPLOYEE RELATIONSHIP

Allied Free Workers Union v. Compania Maritima (1967): 1) The duty to bargain collectively exists only between the employer and its employees. 2) Where there is no duty to bargain collectively, it is not proper to hold certification elections in connection therewith.
Requirements: Book V Rule VII Sec 2-The notice of voluntary recognition shall be accompanied by the original copy and two (2) duplicate copies of the following documents: a) a joint statement under oath of voluntary recognition attesting to the fact of voluntary recognition b) certificate of posting of the joint statement of voluntary recognition for fifteen (15) consecutive days in at least two (2) conspicuous places in the establishment or bargaining unit where the union seeks to operate; c) the approximate number of employees in the bargaining unit, accompanied by the names of those who support the voluntary recognition comprising at least a majority of the members of the bargaining unit; and d) a statement that the labor union is the only legitimate labor organization operating within the bargaining unit. All accompanying documents of the notice for voluntary recognition shall be certified under oath by the employer representative and president of the recognized labor union.
B. ELECTION Certification Election in Organized Establishments (Art. 256): i. Certification Election 1. Petition filed by legitimate labor organization (including mother union and local chapter) 2. Requisites: a. verified; b. filed w/in the 60-day period before expiration of CBA (freedom period); c. supported by written consent of at
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3.
4. 5.
6.
least 25% of ALL employees in the bargaining unit. If the petition is filed by a national union or federation, it shall not be required to disclose the names of the local chapters officers and members. Med-Arbiter shall automatically order an election Requisites: a. by secret ballot; b. at least majority of ALL eligible voters in the unit must have cast their votes. Labor union receiving MAJORITY of the valid votes cast shall be certified as the exclusive bargaining agent of all workers in the unit.
Since none got the majority of the 80 valid votes and the contending unions obtained 60 votes, which even exceed one-half (), a run-off election is proper. The run-off will be between the labor unions receiving the two highest number of votes. The rematch is NOT between two unions but between two highest votes. Thus the run-off will be among Union A, B and C. (ACUZENA) 8. At the expiration of the freedom period, the employer shall continue to recognize the majority status of incumbent bargaining agent where no petition for certification election is filed. Certification Election in Unorganized Establishments (Art. 257): 1. Petition filed by a legitimate labor organization; 2. The Med-Arbiter shall AUTOMATICALLY conduct a certification election. Note: 1. Only a LEGITIMATE labor organization may file the petition. 2. It cannot be an unregistered labor organization. 3. This is best read in relation to Art. 242 which enumerates the rights granted to a legitimate labor organization. 4. One of those rights is the right to be chosen as the exclusive bargaining representative. 5. This is one way the law encourages union registration.
LABOR RELATIONS
ii. Consent Election Voluntarily agreed upon by the parties, during the preliminary conference after the receipt of petition for certification election Bk V RVIII Sec 10 ( as amended by D.O. 40-F-03 Series of 2008, Nov. 8, 2008) The contending unions may agree to the holding of an election. In which case it shall be called a consent election. The MedArbiter shall forwith call for the consent election reflecting the parties agreement and the call in the minutes of the conference. xxx xxx xxx iii. Run-Off Elections a. Conditions: i. A valid election took place because majority of the CBU members voted ii. The election provides for 3 or more choices; Eg. Union A, Union B, and No Union, thus there are at least two union candidates iii. No Choice receives a majority of the valid votes cast; iv. The total number of votes for all contending unions is at least 50% of the total number of votes cast. v. There is no unresolved challenge of voter or election protest b. The run-off election shall be conducted between the labor unions receiving the two highest number of votes. Illustration: The CBU has 100 members and eighty of which voted. Union A= 30; Union B= 15; Union C=15 and No Union= 20. There were no invalid votes.
III.CERTIFICATION ELECTION
Port Workers Union of the Philippines v Laguesma (1992): The certification election is the best method of determining the will of the workers on the crucial question of who shall represent them in their negotiations with the management for a collective bargaining agreement that will best protect and promote their interests. It is essential that there be no collusion against this objective between an unscrupulous management and a union covertly supporting it while professing its loyalty to labor, or at least that the hopes of labor be not frustrated because of its representation by a union that does not enjoy its approval and support. It is therefore sound policy that any doubt regarding the real representation of the workers be resolved in favor of the holding of the certification election. This is preferable to the suppression of the voice of the workers through the prissy observance of technical rules that will exalt procedure over substantial justice.
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Reyes v Trajano (1992): The purpose of a certification election is precisely the ascertainment of the wishes of the majority of the employees in the appropriate bargaining unit: to be or not to be represented by a labor organization, and in the affirmative case, by which particular labor organization.
20 working days. 2. The BLR shall conduct the certification election within 20 days. Art. 256. Representation issue in organized establishments. In organized establishments, when a verified petition questioning the majority status of the incumbent bargaining agent is filed before the Department of Labor and Employment within the sixty-day period before the expiration of the collective bargaining agreement, the Med-Arbiter shall automatically order an election by secret ballot when the verified petition is supported by the written consent of at least twenty-five percent (25%) of all the employees in the bargaining unit to ascertain the will of the employees in the appropriate bargaining unit. xxx xxx xxx Art. 257. Petitions in unorganized establishments. In any establishment where there is no certified bargaining agent, a certification election shall automatically be conducted by the Med-Arbiter upon the filing of a petition by a legitimate labor organization. Art. 259. Appeal from certification election orders. Any party to an election may appeal the order or results of the election as determined by the Med-Arbiter directly to the Secretary of Labor and Employment on the ground that the rules and regulations or parts thereof established by the Secretary of Labor and Employment for the conduct of the election have been violated. Such appeal shall be decided within fifteen (15) calendar days.
A. EMPLOYEE AS INITIATING PARTY IN ORGANIZED AND UNORGANIZED ESTABLISHMENTS: See previous notes on Arts. 256 and 257 on the conduct of certification election in organized and unorganized establishments at page 43. B. EMPLOYER AS INITIATING PARTY An employer may file a petition only when it is requested to bargain collectively.
LABOR RELATIONS
Art. 258 Par. 1. When an employer may file petition. When requested to bargain collectively, an employer may petition the Bureau for an election. If there is no existing certified collective bargaining agreement in the unit, the Bureau shall, after hearing, order a certification election. Art 258-A Employer as by-stander. 1) In all cases, whether the petition for certification election is filed by an employer or a legitimate labor organization, the employer shall not be considered a party thereto with the concomitant right to oppose a petition for certification election. The employer participation is such proceedings shall be limited to: being notified or informed of petitions of such nature; and submitting the list of employees during preelection conference should the Med-Arbiter act favorably on the petition.
D. REQUISITE ELECTION
FOR
VALIDITY
OF
2) a. b.
Art. 256 xxx xxx xxx To have a valid election, at least a majority of all eligible voters in the unit must have cast their votes. xxx xxx xxx Book V, Rule I, Sec 1 (q). Definition of Terms: Eligible voter refers to a voter belonging to the appropriate bargaining unit that is the subject of a petition for certification election.
PT&T v Laguesma, (1993): Employer is a TOTAL STRANGER in the process of Certification Election. Employer has NO STANDING to file a MOTION TO DISMISS. Oriental Tin Can Labor Union v. Secretary of Labor, (1998): A companys interference in the CE creates a suspicion that it intends to establish a company union. C. RESPONSIBLE AGENCY
Bureau of Labor Relations (Art. 226 & 258) 1. All certification cases shall be decided within
There is a failure of elections when: Where the number of votes cast in a certification election is less than the majority of the number of eligible voters; and No material challenged votes.
[Bk V, Rule IX sec 17 ] The election office shall declare a failure of election in the minutes of the election proceeding
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Effect of failure of election BK V, Rule IX sec 18It shall NOT bar the filing of a motion for the immediate holding of another certification or consent election within six (6) months from the date of the declaration of failure of election E. NATURE OF PROCEEDING/ EFFECT OF PRIVATE AGREEMENT Young Men Labor Union Stevedores v CIR, (1965): 1) It is not litigation, but a mere investigation of a non-adversary character. 2) The object of the proceedings is merely the determination of proper bargaining units and the ascertainment of the will and choice of the employees in respect of the selection of the bargaining representative. 3) The determination of the proceeding does not entail the entry of remedial orders or redress of rights, but culmination solely in an official designation of bargaining units and an affirmation of the employees expressed choice of bargaining agent. 1. Implications: 1) Port Workers Union v. DOLE, (1992): Technical rules and objections should not hamper the correct ascertainment of the labor union that has the support and confidence of the majority of the workers and is thus entitled to represent them in bargaining for the terms and conditions of their employment. 2) Samahang Manggagawa sa Permex v Sec. of Labor, (1998): It is the most DEMOCRATIC and most efficacious/effective way. 3) Belyca Corp. v. Ferrer-Calleja (1998): It is a STATUTORY POLICY. 4) George & Peter Lines, Inc. v. Associated Labor Union, (1985): Thus it should not be circumvented There should be no obstacle in conducting the Certification election. 5) PLUM Federation of Industrial and Agrarian Workers v Noriel (1978): Certification election is the fairest and most effective way of determining which labor organization can truly represent the working force. It is a fundamental postulate that the will of the majority given expression in an honest election
with freedom on the part of the voters to make their choice, is controlling. 2. Non-union members: Reyes v. Trajano, (1992): 1) Included in voting in the certification election. 2) Neither law, administrative rule nor jurisprudence requires that only employees affiliated with any labor organization may take part in a certification election. 3) On the contrary, the plainly discernible intendment of the law is to grant the right to vote to all bona fide employees in the bargaining unit, whether they are members of a labor organization or not. Barbizon v. Nagkakaisang Supervisor, (1996): The receipt by the excluded employees of certain benefits under the existing CBA does not bar them from forming their own labor organization and from participating in the certification election. F. ELECTION PROCESS AND PROCEDURE (BOOK V RULE VIII, IRR) 1. Petition for Certification Election a. Who may file: BK V Rule VIII Sec. 1 (as amended by D.O. 40-F-03 Series of 2008, Nov. 8, 2008) 1. Any legitimate labor organization (including mother union and local chapter). The mother union filing in behalf of its local chapter shall not be required to disclose the names of the latters members and officers, but shall attach to the petition the charter certificate that it issued to the said local chapter. 2. The employer a. when requested to bargain collectively, in a bargaining unit where no registered CBA exists. b. Where to file? (Sec. 2)
BK V Rule VIII Sec. 2 1) Regional Office which issued the petitioning unions certificate of registration or certificate of creation of chartered local. 2) The petition shall be heard and resolved by the Med-Arbiter. 3) Where two or more petitions involving the same bargaining unit are filed in one
LABOR RELATIONS
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4)
Regional Office, the same shall be automatically consolidated with the MedArbiter who first acquired jurisdiction. Where the petitions are filed in different Regional Offices, the Regional Office in which the petition was first filed shall exclude all others; in which case, the latter shall indorse the petition to the former for consolidation.
e. Motion for Intervention (Sec 8)

BK V Rule VIII Sec 8 a) In an organized establishment[A]ny legitimate labor union other than the incumbent bargaining agent operating within the bargaining unit may file a motion for intervention with the Med-Arbiter When to file: during the freedom period of the collective bargaining agreement. The form and contents of the motion shall be the same as that of a petition for certification election. b) In an unorganized establishmentWhen to file: [T]he motion shall be filed at anytime prior to the decision of the Med-Arbiter. The form and contents shall likewise be the same as that of a petition for certification election. The motion for for intervention shall be resolved in the same decision issued in the petition for certification election.
CRUZVALE, INC. v Laguesma (1994): The worker, being the economicallydisadvantaged party whether as complainant, petitioner or respondent, as the case may be, the nearest governmental machinery to settle a labor dispute must be placed at his immediate disposal and the employer must in no case be allowed a choice in favor of another competent agency sitting in another place to the inconvenience of the worker.
LABOR RELATIONS
c.
When to file? (Sec. 3)
f.
BK V Rule VIII Sec 3 1) ANYTIME 2) Except: a. when a fact of voluntary recognition has been entered; or i. when a valid certification, consent or run-off election has been conducted within the bargaining unit within 1 year prior to the filing of the petition. ii. Where an appeal has been filed from the order of the Med-Arbiter certifying the results of the election, the running of the one year period shall be suspended until the decision on the appeal has become final and executory. b. When the duly certified union has commenced and sustained negotiations in good faith with the employer in accordance with Art. 250 of the Labor Code within the one year period referred to in the immediately preceding paragraph; c. When a bargaining deadlock to which an incumbent or certified bargaining agent is a party had been d. submitted to conciliation or arbitration or had become the subject of a valid notice of strike or lockout; i. When a CBA between the employer and a duly recognized or certified bargaining agent has been registered in accordance with Art. 231. ii. Where such CBA is registered, the petition may be filed only within sixty (60) days prior to the CBAs expiry.
Preliminary Conference; hearing (Sec 9)

a
BK V Rule VIII Sec9 Who: The Med-Arbiter shall conduct preliminary conference and hearing
When: within the ten (10) days from receipt

of the petition to determine the following: a) the bargaining unit to be represented; b)the contending labor unions; c)possibility of a consent election; d) the existence of anuy opf the bars to certification election under Section 3 of this rule; and e) such other matters as may be relevant for the final disposition of the case.
d. Forced Intervenor (Sec. 7):

BK V Rule VIII sec. 7 The incumbent bargaining agent shall automatically be one of the choices in the certification election as forced intervenor.
g. Order (Sec 13, as amended by D.O. 40-F-03 Series of 2008, Nov. 8, 2008) Book V Rule VIII Sec 13 1. Who: the Med-Arbiter shall formally issue a ruling granting or denying the petition. 2. When: Within ten (10) days from the last hearing Except in an organised establishment where the grant of petition can only be made after the lapse of the freedom period. 3. The ruling for the conduct of certification election shall state the following: a. the name of the employer or the establishment; b. A description of the bargaining unit; c. a statement that none of the grounds for dismissal enumerated in the succeeding paragraph exists; d. the names of the contending labor unions which shall appear in the following order: the petitioner unions in the order of the date of filing of their
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respective petitions; the forced intervenor; and No union; e. To afford an individual an informed choice where a local/chapter is one of the contending unions, a directive to an unregistered local/chapter to personally submit to the election office its certificate of creation at least five (5) working days before the actual conduct of the certification election. Nonsubmission of this requirement as certified by the election offcver shall disqualify the local/chapter from participating in the certification election; and f. a directive to the employer and the contending union(s) to submit within ten (10) days from receipt of the order, the certified list of employees in the bargaining unit, or where necessary, the payrolls covering the members of the bargaining unit for the last three (3) months prior to the issuance of the order. 2. Certification Election Mechanics a. Posting of Notice
Book V Rule IX Sec 6, IRR: 1) Who: Election Officer shall cause the posting 2) What: notice of election 3) Where: 2 conspicuous places in company premises 4) When: at least 10 days before actual election 5) Contents of Notice: a) Date and Time of election; b) Names of all contending unions; c) Description of the bargaining unit d) List of eligible and challenged Voters. 7) The posting of the notice of election, the information required to be included therein and the duration of the posting cannot be waived by the contending unions or the employer.
2) No law, administrative rule or precedent prescribes forfeiture of the right to vote by reason of neglect to exercise the right in past cases. ALL EMPLOYEES ENTITLED TO VOTE Airtime Specialists, Inc. v Director of BLR, (1990): 1) All rank-and-file employees in the appropriate bargaining unit. 2) The Code makes no distinction as to their employment status. 3) All they need to be eligible to support the petition is to belong to a bargaining unit. Philippine Fruits v Torres, (1992): 1) Employees who have been improperly laid off but who have a present, unabandoned right to or expectation of reemployment, are eligible to vote in certification elections. 2) If the dismissal is under question, employees concerned could still qualify to vote in the elections. Rationale for Non-Distinction Policy: Reyes v. Trajano (1992): 1) Collective bargaining covers all aspects of the employment relation and the resultant CBA binds all employees in the bargaining unit. 2) All rank and file employees, probationary or permanent, have a substantial interest in the selection of the bargaining representative. CHALLENGE VOTER Phil. Telephone & Telegraph Co. v Laguesma, (1993): 1) An employer has no standing to question a certification election since this is the sole concern of the workers 2) but may question the inclusion of any disqualified employee in the certification election during the exclusion-inclusion proceedings before the representation officer. c. Voting Day Sec. 2, Rule IX, Book V IRR- The election shall be set on a regular business day.
LABOR RELATIONS
b. Voting List and Voters Acoje Workers Union v NAMAWU, (1963): The basis of determining voters may be agreed upon by the parties (i.e. the use of payroll). EFFECT OF NON-PARTICIPATION IN PREVIOUS ELECTION Reyes v. Trajano, (1992): 1) Failure to take part in previous elections is no bar to the right to participate in future elections.
d. Protest Philippine Fruits and Vegetables Industries v. Torres, (1992): Requirements in order that a protest filed would prosper:
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a. The protest must be filed with the representation officer and made of record in the minutes of the proceedings before the close of election proceedings, and b. The protest must be formalized before the Med-Arbiter within five (5) days after the close of the election proceedings. Jisscor Independent Union v Torres, (1993): Protests not so raised are deemed waived. e. Appeal from Certification Election
in the minutes of the election. Sec 19 (as amended by D.O. 40-F-03 Series of 2008, Nov. 8, 2008)1. When: Within twenty-four (24) hours from final canvass of votes, there being a valid election 2) Who: the Election officer shall transmit 3) What: the records if the case to the Med-Arbiter who shall, within the same period from receipt of the minutes and result of election, i. issue an order proclaiming the results of the election and ii. certifying the union which obtained a majority of the valid votes cast as the sole and exclusive bargaining agent on the subject bargaining unit under any of the following conditions: a) no protest was filed or even if one was filed, the same was not perfected within the five-day period for perfection of the protest b) no challenge or eligibility issue was raised or, even if one was raised, the resolution of the same will not materially change the results of the election. xxx xxx xxx
LABOR RELATIONS
Art 259 i. Appealable: Order of Med-Arbiter ii. Where to Appeal: with the Secretary of Labor iii. Ground: a. The rules and regulations or parts established by the Secretary of Labor for the conduct of election b. have been violated. iv. Period for decision: c. 15 calendar days
f. Annulment United Employees Union of Gelmart Inv. v. Noriel, (1975): General allegation of duress is not sufficient to invalidate a certification election; it must be shown by competent and credible proof Confederation of Citizens Labor Union v. Noriel, (1982): Irregularities that may invalidate certification election: inability of workers to vote; failure to safeguard secrecy of the ballot; intimidation of election supervisors; and neglect in performance of duties. G. CERTIFICATION OF MAJORITY UNION DESIGNATED
H. BARS TO CERTIFICATION ELECTION 1. One-Year Bar Rule

Book V, Rule VIII, Sec 3 (a): 1) Within 1 year from a) fact that voluntary recognition has been entered, or b) time of valid certification, consent or run-off election has been conducted. 2) Reckoning period: a) If APPEALED, date when decision is final and executory. b) Book V, Rule VIII, Sec 14 (d) (formerly sec 14(c) as amended by D.O. 40-F-03 Series of 2008, Nov. 8, 2008)]: [F]rom the date of recording of voluntary recognition or from valid certification, consent, run-off election where no appeal on the results of election is pending.
2. Negotiation Bar Rule

Book V, Rule VIII, Sec 3 (b): When to file 1) A petition for certification election may be filed anytime, 2) EXCEPT: a. When the duly certified union has commenced and sustained negotiations in good faith with the employer b. in accordance with Art 250 of the Labor Code c. within one year period referred to in the immediate paragraph Sec 14 (e) (formerly sec 14(d) as amended by D.O. 40-F-03 Series of 2008, Nov. 8, 2008) The Med-Arbiter may dismiss a petition on any of the following grounds: xxx xxx xxx
Arts. 255, 256: The labor union designated or selected by the majority of the employees in an appropriate collective bargaining unit shall be the exclusive representative of the employees in such unit for the purpose of collective bargaining. Book V Rule IX Sec 15, (as amended by D.O. 40-F-03 Series of 2008, Nov. 8, 2008)- The union which obtained a majority of the valid votes cast shall be certified as the sole and exclusive bargaining agent of all the employees in the appropriate bargaining unit within five (5) days from the day of the election, provided no protest is recorded
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e) Where a duly certified union has commenced and sustained negotiations in accordance with Art 250 of the Labor code within the one-year period referred to in Section 14 of this Rule or xxx xxx xxx
set it aside on technical grounds is not conducive to the public good. Colegio de San Juan de Letran v. Assoc, (2000): Effect of an expired CBA on the contract bar rule: 1) No petition for CE may be filed after the lapse of the 60 day freedom period. 2) The old CBA is extended until a new one is filed. 3) The purpose is to ensure stability in the relationship of the workers and the company by preventing frequent modifications of any CBA earlier entered into by them in good faith and for the stipulated original period. Suspended CBA: 1) Art. 253-A: the representation limit for the exclusive bargaining agent applies only when there is an extant CBA in full force and effect. 2) Rivera v. Espiritu GR no. 135547 January 23, 2002: In the instant case, the parties agreed to suspend the CBA and put in abeyance the limit on the representation period. 4. Deadlock Bar Rule
Book V, Rule VIII, Sec 3 (c) When to file a petitionxxx xxx xxx c) when a bargaining deadlock to which an incumbent or certified bargaining agent is a party had been submitted to conciliation or arbitration or had become the subject of a valid notice of strike or lockout; Sec 14 (e) (formerly sec 14(d) as amended by D.O. 40-F-03 Series of 2008, Nov. 8, 2008) Denial of petition; Grounds: e) xxx xxx xxx where there exist a bargaining deadlock which has been submitted to conciliation or arbitration or has become the subject of a valid notice of strike or lockout where an incumbent or certified bargaining agent is a party;
3. Contract Bar Rule (Art. 232) See page 41.

Book V, Rule VIII, Sec 3 (d) d) When a collective bargaining agreement between the employer and a duly recognized or certified bargaining agent has been registered in accordance with Art 231 of the Labor Code. Where such collective bargaining agreement is registered, the petition may be filed only within sixty (60) days prior to its expiry. Book V, Rule VIII, Sec 14 (a) (as amended by D.O. 40-F-03 Series of 2008, Nov. 8, 2008)]: a) The petitioning union or national union/federation is not listed in the Departments registry of legitimate labor unions or that its registration certificate has been cancelled with finality in accordance with Rule XIV of these rules.
LABOR RELATIONS
Buklod ng Saulog Transit v. Casalla, (1956): 1) GENERAL RULE: The Bureau shall NOT entertain any petition for certification election. 2) EXCEPT: (Freedom period) Arts. 253, 253-A, 256: Within 60 days before expiration of the five year term of the CBA. 3) The contract bar rule can be validly invoked only: a. if the existing CBA contains substantially those materials that should be included in the CBA b. at the time of the filing of the petition for certification election. Trade Union of Philippines v. Laguesma (1994): 1) The procedural requirement of filing the CBA within 30 days from date of execution under Article 231 was not met. But the delay in the filing of the CBA was sufficiently explained, i.e., there was an inter-union conflict on who would succeed to the presidency of union. 2) The non-compliance with the procedural requirement should not adversely affect the substantive validity of the CBA. A collective bargaining agreement is more than a contract. It is highly impressed with public interest for it is an essential instrument to promote industrial peace. Hence, it bears the blessings not only of the employer and employees concerned but even the Department of Labor and Employment. To
REQUISITES 1) Parties must have negotiated in good faith. 2) Deadlock must have been submitted to voluntary arbitration or a valid subject of a valid notice of strike or lock-out. I. SUSPENSION ELECTION OF CERTIFICATION
NOTE: 1) Deadlock Bar rule should be read in relation to Art. 248(d): ULP:
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2) 3)
4)
It shall be unlawful for an employer to commit any of the following unfair labor practice: To initiate, dominate, assist or otherwise interfere with the formation or administration of any labor organization, including the giving of financial or other support to it or its organizers or supporters. This is with respect to the practice of some employers in undermining the workers right to self-organization through the creation of company unions.
J. EFFECT OF CANCELLATION REGISTRATION:
PETITION OF
FOR UNION
Formal charge of ULP against the employer for establishing a company union triggers suspension. Those who may ask For Suspension are: 1) Only a union. 2) CE cannot be suspended based on a pendency of a formal charge of ULP against a labor organization. Rationale For Suspension: United CMC Textile Workers Union v. BLR (1984) 1) If there is a union dominated by the company, to which some of the workers belong, 2) an election among workers and employees of the company would not reflect the true sentiment and wishes of the said workers and employees because the votes of the members of the dominated union would not be free. 3) Such charge of company domination is a prejudicial question that until decided, shall suspend or bar proceedings for certification election. 4) If it were a labor organization objecting to the participation in a certification election of a company-dominated union, 5) as a result of which a complaint for an unfair labor practice case against the employer was filed, 6) and when the court finds that said union is employer-dominated in the unfair labor practice case, 7) the union selected would be decertified 8) and the whole election proceedings would be rendered useless and nugatory.' 9) There would be an impairment of the integrity of the collective bargaining process if a company-dominated union were allowed to participate in a certification election.
Samahang Manggagawa sa Pacific Plastic v. Laguesma, 1997 1) A certification election can be conducted despite the pendency of a petition to cancel the union registration certificate. 2) For the fact iss that at the time the respondent union filed its petition for certification, it still had the legal personality to perform such act absent an order directing its cancellation.
LABOR RELATIONS
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Chapter 6. Collective Bargaining: Concept, Procedures and Issues

I. GENERAL CONCEPTS A. Policy declaration B. Nature and Purpose C. Waiver II. DUTY TO BARGAIN A. Meaning of duty B. Deadlock III. BARGAINING PROCEDURE A. Private procedure B. Labor Code procedure C. Conciliation/preventive mediation, IV. BARGAINABLE ISSUES V. COLLECTIVE BARGAINING AGREEMENT A. Definition B. Contents 1. Effect of sub-standard contract C. Registration D. Beneficiaries E. Interpretation, administration and enforcement 1. Nature of contract and contract interpretation 2. Grievances a) Contract infirmity b) Contract ambiguity 3. Grievance procedure/voluntary arbitration F. Contract duration and renewal G. Substitutionary Doctrine H. Arbitrated CBA I. CBA and 3rd party applicability
2) designed to stabilize the relation between labor and management and to create a climate of sound and stable industrial peace. 3) It is a mutual responsibility of the employer and the Union and is characterized as a legal obligation. 4) So much so that Article 249, par. (g) of the Labor Code makes it an unfair labor practice for an employer to refuse "to meet and convene promptly and expeditiously in good faith for the purpose of negotiating an agreement with respect to wages, hours of work, and all other terms and conditions of employment. B. Nature and Purpose United Employees Union of Gelmart Industries v. Noriel, (1975): 1) The institution of collective bargaining is a prime manifestation of industrial democracy at work. 2) The two parties to the relationship, labor and management, make their own rules by coming to terms to govern themselves in matters that really count. C. Waiver Rivera v. Espiritu (2000): The right to free collective bargaining includes the right to suspend it.
LABOR RELATIONS
II. DUTY TO BARGAIN

A. MEANING OF DUTY
Art. 252: Meaning of duty to bargain collectively. 1) The duty to bargain collectively means the performance of a mutual obligation to meet and convene promptly and expeditiously in good faith for the purpose of: a. negotiating an agreement with respect to wages, hours of work and all other terms and conditions of employment including proposals for adjusting any grievances or questions arising under such agreement and b. executing a contract incorporating such agreements if requested by either party but such duty does not compel any party to agree to a proposal or to make any concession. Art. 253: Duty to bargain collectively when there exists a collective bargaining agreement. 1) a. b. When there is a collective bargaining agreement, the duty to bargain collectively shall also mean: that neither party shall terminate nor modify such agreement during its lifetime. However, either party can serve a written notice to terminate or modify the agreement
I. GENERAL CONCEPTS
A. POLICY DECLARATION
1987 Constitution. Art. XIII, Sec. 3 1) The State shall guarantee the rights of workers to collective bargaining and negotiations. 2) The State shall promote the principle of shared responsibilities 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.
Labor Code, Art 211 (a). 1) To promote and emphasize the primacy of FREE COLLECTIVE BARGAINING and negotiations, including voluntary arbitration, mediation and conciliation, as modes of setting labor or industrial disputes. Kiok Loy v. NLRC (1986): 1) Collective bargaining which is defined as negotiations towards a collective agreement, is one of the democratic frameworks under the New Labor Code,
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c.
at least sixty (60) days prior to its expiration date. It shall be the duty of both parties to keep the status quo and to continue in full force and effect the terms and conditions of the existing agreement during the 60-day period and/or until a new agreement is reached by the parties.
3) The information to be made available may

be agreed upon between the parties to collective bargaining.
B. DEADLOCK San Miguel Corporation v. NLRC, (1999): Collective Bargaining Deadlock: the situation between the labor and the management of the company where there is failure in the collective bargaining negotiations resulting in a stalemate It is a ground for strike or lockout [Rule XXII, Section I, of the Rules and Regulations Implementing Book V the Labor Code]
Kiok Loy v NLRC, (1986): 1) While it is a mutual obligation, the employer is not under any legal duty to initiate contract negotiation. 2) The mechanics of collective bargaining is set in motion when the following are present: a) Possession of the status of majority representation of the employees' representative in accordance with any of the means of selection or designation provided for by the Labor Code, b) Proof of majority representation and c) Demand to bargain under Article 251, par. (a) of the New Labor Code Republic Savings Bank v. CIR (1967): 1) Collective bargaining does not end with the execution of an agreement. It is a continuous process. 2) The duty to bargain imposes on the parties during the term of their agreement i. the mutual obligation "to meet and confer promptly and expeditiously and in good faith . . . ii. for the purpose of adjusting any grievances or question arising under such agreement" and a violation of this obligation is an unfair labor practice. Rights of the Parties during Bargaining:
Art. 242 (c) Right of legitimate labor organization to be furnished by the employer with annual audited financial statements, including the balance sheet and profit and loss statement, upon request. Book V Rule XVI Sec 2. Disclosure information1) The parties shall, at the request of either of them, make available such up-to-date financial information on the economic situation of the undertaking, which is normally submitted to relevant government agencies, as is material and necessary for meaningful negotiations. 2) Where the disclosure of some of this information could be prejudicial to the undertaking, its communication may be made condition upon a commitment that it would be regarded as confidential to the extent required.
LABOR RELATIONS
III.BARGAINING PROCEDURE
A. PRIVATE PROCEDURE Art. 251.
Duty to bargain collectively in the absence of collective bargaining agreements. 1) In the ABSENCE of an agreement or other VOLUNTARY ARRANGEMENT providing for a MORE EXPEDITIOUS manner of collective bargaining, 2) it shall be the duty of the employer and the representatives of the employees to bargain collectively in accordance with the provisions of this Code.
NOTE: 1) The Labor Code authorizes parties to provide for their own procedures in Collective Bargaining 2) but it must be more EXPEDITIOUS than that provided in Art. 250. 3) If they are unable to agree they must follow procedure in the labor code (Art. 250). 4) IMPLICATION: Provisions of this code are only supplementary not mandatory with regards to the process of collective bargaining. 5) It is the policy of the state to promote the primacy of FREE collective bargaining. (211a).
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B. LABOR CODE PROCEDURE Art. 250

Party desiring to bargain collectively shall serve written notice on other party with statement of proposals
Reply by other party within 10 calendar days from receipt of notice
2) The companys refusal to make a counter-proposal to the unions proposed CBA is an indication of its bad faith. 3) Where the employer did not even bother to submit an answer to the bargaining proposals of the union, there is a clear evasion of the duty to bargain collectively. 4) The employers actuation show a lack of sincere desire to negotiate, rendering it guilty of unfair labor practice. General Milling Corp. vs.CA (2004): 1) GMCs failure to make a timely reply to the proposal sent by the union is indicative of its utter lack of interest in bargaining with the union. 2) Its excuse that it felt the union no longer represented the workers was mainly dilatory as it turned out to be utterly baseless. 3) GMCs refusal to make a counterproposal is an indication of its bad faith. 4) Where the employer did not even bother to submit an answer to the bargaining proposals of the union, there is a clear evasion of the duty to bargain collectively. 5) It is guilty of ULP. C. CONCILIATION/PREVENTIVE MEDIATION
Art. 233: Privileged Communication Information and statements made at conciliation proceedings shall be treated as privileged communication and shall not be used as evidence in the Commission. Conciliators and similar officials shall not testify in any court or body regarding any matters taken up at conciliation proceedings conducted by them. Procedure in Collective Bargaining Art. 250 (c) If the dispute is not settled, the Board shall intervene upon request of either or both parties or at its own initiative and immediately call the parties to conciliation
Should differences arise, request for conference: within 10 days from date of request
LABOR RELATIONS
If dispute not settled, National Conciliation Mediation Board (NCMB) shall intervene on request or motu proprio & call parties to conciliation meetings
Art. 253. Duty to bargain collectively when there exists a collective bargaining agreement. 1) When there is a collective bargaining agreement, the duty to bargain collectively shall also mean: a. that neither party shall terminate nor modify such agreement during its lifetime. b. However, either party can serve a written notice to terminate or modify the agreement at least sixty (60) days prior to its expiration date. c. It shall be the duty of both parties to keep the status quo and to continue in full force and effect the terms and conditions of the existing agreement d. during the 60-day period and/or until a new agreement is reached by the parties.
National Union of Restaurant Workers vs.CIR (1964): 1) Whenever a party serves a written notice upon the employer making demands, the latter shall reply not later than 10 days. 2) However, this condition is merely procedural, and non-compliance cannot be deemed to be an act of ULP. 3) The fact is that respondent employer did not ignore the letter sent by the union so much so that they called a meeting to discuss its demands, as already stated elsewhere. Compare with . Colegio de San Juan de Letran vs. Association (2000): 1) More than a month after the proposals were submitted, the employer has not made any counter-proposals.
meetings. During Conciliation Proceedings:

Art. 250. Procedure in collective bargaining. The following procedures shall be observed in collective bargaining: a) When a party desires to negotiate an agreement, it shall serve a written notice upon the other party with a statement of its proposals. The other party shall make a reply thereto not later than ten (10) calendar
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b)
c)
d)
e)
days from receipt of such notice; Should differences arise on the basis of such notice and reply, either party may request for a conference which shall begin not later than ten (10) calendar days from the date of request. If the dispute is not settled, the Board shall intervene upon request of either or both parties or at its own initiative and immediately call the parties to conciliation meetings. The Board shall have the power to issue subpoenas requiring the attendance of the parties to such meetings. It shall be the duty of the parties to participate fully and promptly in the conciliation meetings the Board may call; During the conciliation proceedings in the Board, the parties are prohibited from doing any act which may disrupt or impede the early settlement of the disputes; and The Board shall exert all efforts to settle disputes amicably and encourage the parties to submit their case to a voluntary arbitrator.
the President upon recommendation of the Secretary of Labor and Employment. 3) There shall be as many ConciliatorsMediators as the needs of the public service require, who shall have at least three (3) years of experience in handling labor relations and who shall be appointed by the Secretary. Functions: 1) Formulate policies, programs, standards, procedures, manuals of operation and guidelines pertaining to effective mediation and conciliation of labor disputes; 2) Perform preventive mediation and conciliation functions; 3) Coordinate and maintain linkages with other sectors of institutions, and other government authorities concerned with matters relative to the prevention and settlement of labor disputes; 4) formulate policies, plans, programs, standards, procedures, manuals of operation and guidelines pertaining to the promotion of cooperative and nonadversarial schemes, grievance handling, voluntary arbitration and other voluntary modes of dispute settlements; 5) Administer the voluntary arbitration program; maintain/update a list of voluntary arbitrations; compile arbitration awards and decisions; 6) Provide counselling and preventive mediation assistance particularly in the administration of collective agreement; awards and decisions; 7) Monitor and exercise technical supervision over the Board programs being implemented in the regional offices; and 8) Perform such other functions as may be provided by law or assigned by the Secretary. Tripartite Voluntary Arbitration Advisory Council 10) A Tripartite Voluntary Arbitration Advisory Council is hereby created and attached to the National Conciliation and Mediation Board. 11) The Tripartite Voluntary Arbitration Advisory Council shall advise the National Conciliation Board on matters pertaining to the promotion of voluntary arbitration as the preferred mode of dispute settlement. 12) The Tripartite Voluntary Arbitration Advisory Council shall consist of:
LABOR RELATIONS
1)
2) 3)
1)
2) 1) 2)
EO 251. Sec. 4. Section 22 of Executive Order No. 126 is hereby amended to read as follows: "Sec. 22. National Conciliation and Mediation Board. Overview: A National Conciliation and Mediation Board, herein referred to as the "Board", is hereby created and which shall absorb the conciliation mediation and voluntary arbitration functions of the Bureau of Labor of Relations. It shall be an attached agency under the administrative supervision of the Secretary of Labor and Employment. The Board shall have its main office in Metropolitan Manila and its Administrators shall exercise supervision over Conciliators-Mediators and all its personnel. Branches: It shall establish as many branches as there are administrative regions in the country, with a many Conciliatormediators as shall be necessary for its effective operation. Each branch of the Board shall be headed by an Executive ConciliatorMediator. Composition: The Board shall be composed of: a) Administrator, and b) 2 Deputy Administrators The Administrators and the Deputy Administrators shall be appointed by
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a) Administrator of the National Conciliation and Mediation Board as Chairman, b) 1 other member from the government, c) 2 members representing labor, and d) 2 other members representing management. 13) The members shall be appointed by the President to serve for a term of 3 years. 14) The Chairman and Members thereof shall serve without compensation.
Illustration: a) Phil American Mgt Co. v. Phil. American Mgt Employees (1973:The question of minimum wage is not negotiable. b) Nestle Phil. V NLRC (1991): Retirement plan is negotiable..
V. COLLECTIVE BARGAINING AGREEMENT

A. DEFINITION
IV. BARGAINABLE ISSUES

Art. 252 xxx xxx xxx for the purpose of negotiating an agreement with respect to wages, hours of work and all other terms and conditions of employment including proposals for adjusting any grievances or questions arising under such agreement. Xxx xxx xxx The other terms and conditions of employment to become a mandatory bargainable issue must have a connection between the proposal and the nature of the work.
Art. 250, 252 a) A contract executed upon request of either the employer or the exclusive bargaining representative b) incorporating the agreement reached after negotiations c) with respect to wages, hours of work and all other terms and conditions of employment, d) including proposals for adjusting any grievances or questions arising under such agreement.
Note: While the terms and conditions of a CBA constitute the law between the parties, it is not, however, an ordinary contract to which is applied the principles of law governing ordinary contracts.
LABOR RELATIONS
Importance of determining whether an issue is a mandatory bargaining issue or only a permissive bargaining issue: Samahang Manggagawa sa Top Form v. NLRC, 1998 1) "The question as to what are mandatory and what are merely permissive subjects of collective bargaining is of significance on the right of a party to insist on his position to the point of stalemate. 2) A party may refuse to enter into a collective bargaining contract unless it includes a desired provision as to a matter which is a mandatory subject of collective bargaining. 3) But a refusal to contract unless the agreement covers a matter which is not a mandatory subject is in substance a refusal to bargain about matters which are mandatory subjects of collective bargaining; 4) and it is no answer to the charge of refusal to bargain in good faith that the insistence on the disputed clause was not the sole cause of the failure to agree or that agreement was not reached with respect to other disputed clauses.
Davao Integrated Port Stevedoring Services v. Abarquez, (1993): 1) A CBA, as a labor contract within the contemplation of Article 1700 Civil Code which governs the relations between labor and capital, 2) is not merely contractual in nature but impressed with public interest, thus, it must yield to the common good. B. CONTENTS Effect of Sub-standard Contract:
This was deleted as a ground for cancellation of registration by R.A. 9481. But it is nonetheless prohibited to enter into sub-standard contract.
C. REGISTRATION
Art. 231 - Registry of unions and file of CBAs General Rule: The file shall be open and accessible to interested parties. Exceptions: a. No specific information submitted in
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confidence shall be disclosed unless authorized by the Secretary of Labor; or b. When it is at issue in any judicial litigation when public interest or national security so requires.
literal meaning of the stipulations shall control, 4) but if the words appear to be contrary to the evident intention of the parties, the latter shall prevail over the former. 3. Grievance procedure/voluntary arbitration Art. 260. Grievance Machinery and Voluntary Arbitration The parties to a Collective Bargaining Agreement shall include therein: 1) Provisions that will ensure the mutual observance of its terms and conditions. 2) A machinery for the adjustment and resolution of grievances arising from: a) the interpretation or implementation of their CBA; and b) those arising from the interpretation or enforcement of company personnel policies. 3) All grievances submitted to the grievance machinery which are not settled within 7 calendar days from the date of its submission shall automatically be referred to voluntary arbitration prescribed in the CBA. Navarro III v. Damasco, (1995): Grievances arising from the interpretation or implementation of the CBA are subjects of the grievance procedure Master Iron Labor Union v. NLRC, (1993): a. It should be remembered that a grievance procedure is part of the continuous process of collective bargaining. b. It is intended to promote a friendly dialogue between labor and management as a means of maintaining industrial peace Caltex Refinery Employees Association v. Brilliantes, (1997): 1) No particular setup for a grievance machinery is required by law. 2) Art. 260 of, as incorporated by R.A. 6715, only mandates that the parties to the CBA 3) establish a machinery to settle problems arising from i. "interpretation or implementation of their collective bargaining agreement and ii. those arising from the interpretation or enforcement of company personnel policies."
D. BENEFICIARIES See notes on Art. 255. New Pacific Timber and Supply v. NLRC, 2000 1) All workers in an CBU. 2) When a collective bargaining contract is entered into by the union representing the employees and the employer, even the nonmember employees are entitled to the benefits of the contract. 3) To accord its benefits only to members of the union without any valid reason would constitute undue discrimination against non-members. E. INTERPRETATION, ADMINISTRATION AND ENFORCEMENT 1. Nature of contract interpretation and contract
LABOR RELATIONS
Mactan Workers Union vs. Aboitiz (1972): the terms and conditions of a collective bargaining contract constitute the law between the parties. 2. Grievances a) Contract infirmity b) Contract ambiguity Babcock-Hitachi (Phils.) V. Babcock-Hitachi, (2005): those who are entitled to its benefits can invoke its provisions. In the event that an obligation therein imposed is not fulfilled, the aggrieved party has the right to go to court for redress. Kimberly Clark Phils. V. Lorredo, 1993 1) A CBA, just like any other contract, is respected as the law between the contracting parties and compliance in good faith is mandated. 2) Similarly, the rules embodied in the Civil Code on the proper interpretation of contracts can very well govern. 3) The intention of the parties is primodial; if the terms of the contract are clear, the
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Voluntary Arbitration Procedure: Art. 260. Grievance Machinery and Voluntary Arbitration xxx xxx xxx 1) Parties to a CBA shall: a) Name and designate in advance a Voluntary Arbitrator or panel of Voluntary Arbitrators, OR b) Include in the agreement a procedure for the selection of such Voluntary Arbitrator or panel of Voluntary Arbitrators preferably from the listing of qualified Voluntary Arbitrators duly accredited by the Board. 2) In case the parties fail to select a Voluntary Arbitrator or panel of Voluntary Arbitrators, the Board shall designate the Voluntary Arbitrator or panel of Voluntary Arbitrators, as may be necessary, pursuant to the selection Voluntary Arbitrator or panel of Arbitrators procedure agreed upon in the CBA, which shall act with the same force and effect as if the has been selected by the parties as described above. Art. 255: However, an individual employee or group of employees shall have the right at any time to present grievances to their employer F. Contract duration and renewal Art. 253-A. Terms of a CBA a. POLITICAL ASPECT: Any Collective Bargaining Agreement that the parties may enter into shall, insofar as the representation aspect is concerned, be for a term of five (5) years. No petition questioning the majority status of the incumbent bargaining agent shall be entertained and no certification election shall be conducted by the DOLE outside of the sixty-day period immediately before the date of the expiry of such five year term of the Collective Bargaining Agreement. b. ECONOMIC ASPECT: All other provisions of the CBA shall be renegotiated not later than three (3) years after its execution.
Any agreement on such other provisions of the CBA entered into within six months from the expiry of the term of such other provisions as fixed in such CBA, shall retroact to the day immediately following such date. If any such agreement is entered into beyond six months, the parties shall agree on the duration of the retroactivity thereof. In case of a deadlock in the renegotiation of the CBA, the parties may exercise their rights under this Code.
LABOR RELATIONS
Manila Electric Co. V. Quisumbing (1999): 1) Art. 253-A serves as the guide in determining when the CBA at bar is to take effect. 2) It provides that the representation aspect of the CBA is to be for a term of 5 years. 3) All other provisions of the CBA shall be renegotiated not later than 3 years after its execution. 4) Any agreement on such other provision of the CBA entered into within 6 months from the date of expiry of the term of such other provisions as fixed in such Collective Bargaining Agreement 5) shall retroact to the day immediately following such date. 6) If such agreement is entered into beyond 6 months, the parties shall agree on the duration of the effectivity thereof. 7) If no agreement is reached within 6 months from the expiry date of the 3 years that follow the CBA execution, the law expressly gives the parties not anybody else the discretion to fix the effectivity of the agreement. 8) The law does not specifically cover the situation where 6 months have elapsed but no agreement has been reached with respect to effectivity. In this eventuality, any provision of law should then apply. Hold Over Principle Article 253 1) In the absence of a new CBA, the parties must maintain the status quo and must continue in full force and effect the terms and conditions of the existing agreement during the sixty (60) day period and/or until a new agreement is reached. 2) In this manner, the law prevents the
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existence of a gap in the relationship between the collective bargaining parties. G. Substitutionary Doctrine Benguet Consolidated, Inc. v BCI Employees and Workers UnionPAFLU (1968): Where there occurs a shift in employees union allegiance after the execution of a collective bargaining contract with their employer, the employees can change their agent the labor union, but the CBA continues to exist. New Pacific Timber and Supply Co. Inc v. NLR, ( 2000): 1) The terms of an existing CBA, particularly its economic provisions, can be extended beyond the 3 year period prescribed by law in the absence of a new agreement. 2) Until a new CBA has been executed by and between the parties, they are duty bound to keep the status quo and to continue in full force and effect the terms and conditions of the existing agreements. 3) The law does not provide for an exception nor qualification as to which of the economic provisions of the existing agreements are to retain force and effect, therefore it encompasses all provisions. 4) The New CBA is given PROSPECTIVE effect generally since 253 and 253-A provides for an automatic renewal clause in existing CBAs. 5) PURPOSE: To avoid creating a gap during which no agreement would govern. It is better for industrial peace if effectivity of the CBA is longer. H. Arbitrated CBA Manila Electric Company vs. Quisumbing, (1999): 1) In the absence of an agreement between the parties, an arbitrated CBA takes on the nature of any judicial or quasijudicial award. 2) It operates and may be executed only prospectively unless there are legal justifications for its retroactive application. Manila Central Line Corp. v. Manila Central Line Free Workers Union (1998):
1) CBA in this case, on the other hand, is part of an arbitral award. 2) As such, it may be made retroactive to the date of expiration of the previous agreement. 3) Therefore, in the absence of a specific provision of law prohibiting retroactivity of the effectivity of arbitral awards issued by the Secretary of Labor pursuant to Art. 263(g), the latter is deemed vested with plenary and discretionary powers to determine the effectivity thereof.
LABOR RELATIONS
I. CBA and 3rd party applicability Sundowner Devt. Corp. v Drilon (1989): 1) Labor contracts such as employment contracts and CBAs are not enforceable against a transferee of an enterprise, 2) labor contracts being in personam, is binding only between the parties. Manlimos v. NLRC (1995): 1) Indeed, an innocent transferee of a business establishment has no liability to the employees of the transferor to continue employing them. 2) Nor is the transferee liable for past unfair labor practices of the previous owner, 3) Except: i. when the liability therefore is assumed by the new employer under the contract of sale, or ii. when liability arises because of the new owner's participation in thwarting or defeating the rights of the employees. 4) The most that the transferee may do, for reasons of public policy and social justice, is to give preference to the qualified separated employees in the filling of vacancies in the facilities of the purchaser.
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Chapter 7. Union Concerted Activities

I. BASIS OF RIGHT TO ENGAGE IN CONCERTED ACTIVITIES A. Constitution B. Statutory C. Limitations II. TYPES OF CONCERTED ACTIVITIES A.Strike 1. Definition, nature, purpose 2. Effect on work relationship 3. Types and conversion 4. Grounds 5. Striking party 6. Procedural requirements 7. Test of legality B. Picketing 1. Definition, nature, purpose of picket line 2. Picketing and libel laws 3. Curtailment 4. Regulation/restrictions, innocent third party rule and liabilities 5. Prohibited activities; peaceful picketing C. Slowdown III. ROLE OF PEACE OFFICERS DURING STRIKES AND PICKETING A. Escorting B.Arrest and detention of law violators
of employers to lockout, consistent with the national interest, shall continue to be recognized and respected. 3) However, no labor union may strike and no employer may declare a lockout on grounds involving inter-union and intra-union disputes. ART. 246. It shall be unlawful for any person to: 1) Restrain, 2) Coerce, 3) Discriminate Against Or 4) Unduly Interfere With Employees And Workers In Their Exercise Of The Right To Self-Organization. Right to self-organization shall include the right to: 1) form, 2) join, or 3) assist labor organizations a) for the purpose of collective bargaining b) through representatives of their own choosing, and 4) to engage in lawful concerted activities for the same purpose for their mutual aid and protection. C. Limitations
Batangas Laguna Tayabas Bus Co. v NLRC, G.R. No. 101858, Aug. 21, 1992: The strike is a powerful weapon of the working class. Precisely because of this, it must be handled carefully, like a sensitive explosive, lest it blow up in the workers own hands. Thus, it must be declared only after the most thoughtful consultation among them, conducted in the only way allowed, that is, peacefully, and in every case conformably to reasonable regulation. Any violation of the legal requirements and strictures will render the strike illegal, to the detriment of the very workers it is supposed to protect.
LABOR RELATIONS
I. Basis of Right to Engage in Concerted Activities

A. Constitution
ART. XIII. Sec. 3. The state shall guarantee the rights of all workers to: 1) self-organization, 2) collective bargaining and negotiations, and 3) peaceful concerted activities, 4) including the right to strike in accordance with law.
B. Statutory ART. 263. 1) Workers shall have the right to engage in concerted activities: a. for purposes of collective bargaining; or b. for their mutual benefit and protection. 2) The right of legitimate labor organizations to strike and picket and
II. Types of Concerted Activities

A. Strike International Covenant on Economic, Social and Cultural Rights. ART. 8: The States Parties to the present Covenant undertake to ensure: (d) The right to strike, provided that it is exercised in conformity with the laws of the particular country.
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1. Definition, nature, purpose Art. 212 (o) Strike: 1) Any temporary stoppage of work 2) by the concerted action of employees 3) as a result of an industrial or labor dispute.
Samahang Manggagawa v. Sulpicio Lines (2004): 1) The term strike shall comprise not only concerted work stoppages, 2) but also slowdowns, mass leaves, sitdowns, attempts to damage, destroy or sabotage plant equipment and facilities, and similar activities.
4) but the employer either refuses to reinstate them or imposes upon their reinstatement new conditions that constitute unfair labor practices, 5) the strikers, who refuse to accept the new conditions and are consequently refused reinstatement, 6) are entitled to the losses of pay they may have suffered by reason of the employers discriminatory acts from the time they were refused reinstatement. As to Reinstatement and Backwages: General Rule:
Cromwell Commercial Employees and Laborers Union (PTUC) v CIR (1965): 1) Both employees who are discriminatorily dismissed 2) as well as those who strike because of the employer's unfair labor practice are entitled to reinstatement. 3) Excepted from the rule are those who: a. on account of violence or other misconduct during the strike or b. who, because of subsequent employment elsewhere, 4) must be deemed to have forfeited the right to reinstatement, having in view the policies of the Industrial Peace Act. 5) With respect to backwages, however, only discriminatorily dismissed employees are entitled to backpay. 6) Those who voluntarily strike, even if it be in protest against unfair labor practice, are not entitled to backwages 7) UNLESS, after giving up the strike and presenting themselves to the employer, the latter should refuse to reinstate them or should reinstate them subject to new conditions that are also discriminatory.
LABOR RELATIONS
Guidelines Governing Labor Relations 1) The right to strike is a constitutional and legal right of the workers as employers have the right to lockout, all within the context of labor relations and collective bargaining. 2) Subject to the enactment by Congress of amendments or a new law on labor relations, the provisions of existing laws shall govern the exercise of those rights. Phil. Can Co. v. CIR (1950):
1) 2) A strike is a coercive measure resorted to by laborers to enforce their demands. The idea behind a strike is that a company engaged in a profitable business cannot afford to have its production or activities interrupted, much less, paralyzed.
2. Effect on work relationship

Elizalde Rope Factory, Inc. v. SSS (1972): 1) 2) Although during a strike the worker renders no work or service and receives no compensation, yet his relationship as an employee with his employer is not severed or dissolved
1) As a general rule, striking employees are not entitled to the payment of wages for unworked days during the period of the strike pursuant to the principle of No work- No pay. 2) However, this does not preclude the parties from entering into an agreement to the contrary. 3) On the other hand, when strikers abandon the strike and apply for reinstatement despite the existence of valid grounds
Exceptions to the Backwages Rule: 1) when the employees were illegally locked out to thus compel them to stage a strike; 2) when the employer is guilty of the grossest form of ULP; 3) when the employer committed discrimination in the rehiring of strikers refusing to readmit those against whom there were pending criminal cases while admitting nonstrikers who were also criminally charged in court; or 4) when the workers who staged a voluntary ULP strike offered to return to work unconditionally but the employer refused to reinstate them. (Phil. Diamond Hotel and Resort, Inc. v. Manila Diamond Hotel Employees Union, 2006):
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3. Forms and conversion Forms of Strikes: 1) LEGAL STRIKE one called for a valid purpose and conducted through means allowed by law. 2) ILLEGAL STRIKE one staged for a purpose not recognized by law, or if for a valid purpose, conducted through means not sanctioned by law. 3) ECONOMIC STRIKE one staged by workers to force wage or other economic concessions from the employer which he is not required by law to grant (Consolidated Labor Association of the Phil. v. Marsman and Company 1964). 4) ULP STRIKE one arising out of and against a company's unfair labor practice. 5) SLOWDOWN STRIKE one by which workers, without a complete stoppage of work, retard production or their performance of duties and functions to compel management to grant their demands (Ilaw at Buklod ng Manggagawa v. NLRC, 1991). 6) WILD-CAT STRIKE one declared and staged without filing the required notice of strike and without the majority approval of the recognized bargaining agent. 7) SIT DOWN STRIKE one where the workers stop working but do not leave their place of work. Consolidated Labor Assoc. of the Phil. v. Marsman and Company (1964): It is possible for a strike to change its character from an economic to a ULP strike. In the instant case, initially, the strike staged by the Union was meant to compel the Company to grant it certain economic benefits set forth in its proposal for collective bargaining. However, the strike changed its character from the time the Company refused to reinstate complainants because of their union activities after it had offered to admit all the strikers and in fact did readmit the others. It was then converted into an unfair labor practice strike. Non-conversion: Strike to lockout
Rizal Cement Workers Union v. CIR, 1962) 1) A strike CANNOT be converted into a pure and simple lockout
2) by the mere expedient of filing before the

trial court a notice of offer to return to work during the pendency of the labor dispute between the union and the employer.
4. Grounds Book V Rule XXII Sec. 5. Grounds for Strike or Lockout: 1) A strike or lockout may be declared in cases of: a) Bargaining deadlocks b) ULP. 2) Violations of collective bargaining agreements, except flagrant and/or malicious refusal to comply with its economic provisions, shall not be considered ULP and shall not be strikeable. 3) No strike or lockout may be declared: a) On grounds involving inter-union and intra-union disputes, or b) Without first having filed a notice of strike or lockout, or c) Without the necessary strike or lockout vote having been obtained and reported to the NCMB, or d) After assumption by the Secretary or after certification or submission of the dispute to compulsory or voluntary arbitration or during the pendency of cases involving the same grounds for the strike or lockout. a) Allowable strikes Art. 263 (c): Strikes, picketing and lockouts Bargaining Deadlocks: In case of bargaining deadlocks, the duly certified or recognized bargaining agent may file a notice of strike or the employer may file a notice of lockout with the Department at least 30 days before the intended date thereof. ULP: a) In cases of unfair labor practice, the period of notice shall be 15 days. b) In the absence of a duly certified or recognized bargaining agent, the notice of strike may be filed by any legitimate labor organization in behalf of its members. c) In case of dismissal from employment of union officers duly elected in accordance with the union constitution and by-laws, which may constitute union busting, where the existence of the union is threatened, the 15-day cooling-off period
LABOR RELATIONS
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shall not apply and the union may take action immediately. 3) b) Prohibited strikes Art. 263 (b), last sentence: No labor union may strike and no employer may declare a lockout on grounds involving inter-union and intra-union disputes. Art. 264 (a): 1) No labor organization or employer shall declare a strike or lockout without first having: a) Bargained collectively in accordance with Title VII of this Book, or b) Filed the notice required in the preceding Article or without the necessary strike or lockout vote first having been obtained and reported to the Department. 2) No strike or lockout shall be declared after assumption of jurisdiction by the President or the Secretary or after certification or submission of the dispute to compulsory or voluntary arbitration or during the pendency of cases involving the same grounds for the strike or lockout. 3) Any union officer who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status: PROVIDED, That mere participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his employment, even if a replacement had been hired by the employer during such lawful strike.
Ilaw at Buklod ng Manggagawa v NLRC, 1991) 1) Wage distortion is not a valid ground for a strike 2) since the law provides for a procedure to settle wage distortion problems.
4)
5)
6)
7)
8)
Union [PTUC] v. Court of Industrial Relations, 1964). Where the strikers used epithets to prevent other laborers to go to work (Liberal Labor Union v. Philippine Can Co., 1952). Where the strikers circulated libelous statements against the employer which show actual malice (Linn v. United Plan Guard Workers, 15 L.Ed 2d 582). Where the strikers formed a human cordon and blocked all the ways and approaches to the launches and vessels of the vicinity of the workplace (United Seamen's Union of the Philippines vs. Davao Shipowners Association, 1987). Where strikers hijacked the employer's bus and barricaded the terminal by means of five buses which had also been hijacked (First City Interlink Transportation Co., Inc. v. Sec. Confesor). Breaking of the truck side and windows, and throwing of empty bottles at nonstrikers (Philippine Marine Officers' Guild v. Compania Maritima, 1968). Where acts of sabotage were committed against property (National Labor Union, Inc. v. Court of Industrial Relations, 70 Phil. 300). c) No strike clause
LABOR RELATIONS
Panay Electric Co. v. NLRC, 1995; Malayang Samahan ng mga Manggagawa sa Greenfield v. Ramos (2000): 1) A "no strike, no lock-out" provision in the CBA is a valid stipulation 2) although the clause may be invoked by an employer only when the strike is economic in nature or one which is conducted to force wage or other concessions from the employer that are not mandated to be granted by the law itself. 3) It would be inapplicable to prevent a strike which is grounded on unfair labor practice.
5. Striking party Book V Rule XXII Sec. 6. Who may declare a strike of lockout: 1) Certified or duly recognized bargaining representative 2) Employer 3) In the absence of certified or duly recognized bargaining representative, any legitimate labor organization in the establishment, but only on grounds of ULP.
THE FOLLOWING ACTS HAVE BEEN HELD TO BE ILLEGAL: 1) Where the strikers shouted slanderous and scurrilous words against the owners of the vessels (United Seamen's Union of the Philippines v. Davao Shipowners Association, 1967). 2) Where the strikers used unnecessary and obscene language (Cromwell Commercial Employees and Laborers
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6. Procedural requirements a) Effort to bargain Art. 264 (a): 1) No labor organization or employer shall declare a strike or lockout without first having bargained collectively in accordance with Title VII of this Book... See Ch. 6 for discussion of Arts. 25-252. b) Filing of notice of intention Art. 263 (c), (d): 1) In case of bargaining deadlocks, the duly certified or recognized bargaining agent may file a notice of strike or the employer may file a notice of lockout with the Department at least 30 days before the intended date thereof. 2) In cases of unfair labor practice, the period of notice shall be 15 days. 3) In the absence of a duly certified or recognized bargaining agent, the notice of strike may be filed by any legitimate labor organization in behalf of its members. 5) The notice must be in accordance with such implementing rules and regulations as the Secretary may promulgate.
In case the notice does not conform with the requirements, the regional branch of the NMCB shall inform the concerned party of such fact.
Book V Rule XXII Sec. 9 Action on Notice: 1) Upon receipt of a valid notice of strike or lockout, the NCMB, through its Conciliator-Mediators, shall call the parties to a conference the soonest possible time in order to actively assist them to explore all possibilities for amicable settlement. 2) The Conciliator-Mediator may suggest/offer proposals as an alternative avenue for the resolution of their disagreement/conflict which may not necessarily bind the parties. 3) If conciliation/mediation fails, the parties shall be encouraged to submit their dispute for voluntary arbitration.
Stamford Marketing Corp v. Julian, (2004): 1) The procedural requirements are mandatory, meaning, non-compliance therewith makes the strike illegal. 2) The evident intention of the law in requiring the strike notice and strike-vote report is to reasonably regulate the right to strike. Capitol Medical Center, Inc. v. NLRC (2005): 1) Aside from the mandatory notices embedded in Art. 263, paragraphs (c) and (f) of the Labor Code, 2) a union intending to stage a strike is mandated to notify the NCMB of the meeting for the conduct of strike vote, at least twenty-four (24) hours prior to such meeting. 3) Unless the NCMB is notified of the date, place and time of the meeting of the union members for the conduct of a strike vote, the NCMB would be unable to supervise the holding of the same, if and when it decides to exercise its power of supervision. 4) The requirement of giving notice of the conduct of a strike vote to the NCMB at least 24 hours before the meeting for the said purpose is designed to: (a) inform the NCMB of the intent of the union to conduct a strike vote; (b) give the NCMB ample time to decide on whether or not there is a need to supervise the conduct of the strike vote to prevent any acts of violence and/or irregularities attendant thereto; and (c) should the NCMB decide on its own initiative or upon the request of an interested party including the employer, to supervise the strike vote, to give it ample time to prepare for the deployment of the requisite personnel, including peace officers if need be.
LABOR RELATIONS
Book V Rule XXII Sec. 8: Contents of Notice (3NS) 1) Names and addresses of the employer and the union involved 2) Nature of the industry to which the employer belongs 3) Number of union members and of workers in the bargaining unit 4) Such other relevant data as may facilitate the settlement of the dispute. Additional Requirements: In cases of bargaining deadlocks: 1) Statement of Unresolved issues in the bargaining negotiations 2) Written Proposals of the union 3) Counterproposals of the employer 4) Proof of a request for conference to settle the differences. In cases of ULP: 1) Statement of Acts complained of 2) Efforts taken to resolve the dispute amicably.
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c) Observance of cooling-off periods Art. 263 (c), (e): 1) In case of dismissal from employment of union officers duly elected in accordance with the union constitution and by-laws, which may constitute union busting, where the existence of the union is threatened, the 15-day cooling-off period shall not apply and the union may take action immediately. 2) During the cooling-off period, it shall be the duty of the Ministry to exert all efforts at mediation and conciliation to effect a voluntary settlement. Should the dispute remain unsettled until the lapse of the requisite number of days from the mandatory filing of the notice, the labor union may strike or the employer may declare a lockout. National Federation of Sugar Workers vs. Ovejera
(1982): 1) The purpose of the cooling-off period is to provide an opportunity for mediation and conciliation. 2) The waiting period, on the other hand, is intended to provide opportunity for the members of the union or the management to take the appropriate remedy in case the strike or lockout vote report is false or inaccurate. 3) The observance of both periods must be complied with, although a labor union may take a strike vote and report the same within the statutory cooling-off period. 4) The cooling-off and 7-day strike ban provisions of law constitute a valid exercise of police power of the State. Gold City Integrated Port Service, Inc. vs. NLRC (1995): 1) The 7-day strike ban is a distinct and separate requirement from the cooling-off period prescribed by law. 2) The latter cannot be substituted for the former. 3) Both periods are mandatory. Sukhothai Cuisine & Restaurant v CA, (2006): 1) The language of the law leaves no room for doubt that the cooling-off period and the seven-day strike ban after the strike-vote report 2) were intended to be mandatory and 3) in case of union busting where the existence of the union is threatened, it is only the 15-day cooling-off period that may be dispensed with.
d) Strike vote Art. 263 (f): 1) A decision to declare a strike must be approved by a majority of the total union membership in the bargaining unit concerned, obtained by secret ballot in meetings or referenda called for that purpose. 2) A decision to declare a lockout must be approved by a majority of the board of directors of the corporation or association or of the partners in a partnership, obtained by secret ballot in a meeting called for that purpose. 3) The decision shall be valid for the duration of the dispute based on substantially the same grounds considered when the strike or lockout vote was taken. 4) The Department may, at its own initiative or upon the request of any affected party, supervise the conduct of the secret balloting. 5) In every case, the union or the employer shall furnish the Department the results of the voting at least 7 days before the intended strike or lockout, subject to the cooling-off period herein provided.
NSFW vs. Ovejera, G.R. No. 59743, May 31, 1982 1) In the event the result of the strike/lockout ballot is filed within the cooling-off period, 2) the 7-day requirement shall be counted from the day following the expiration of the cooling-off period
LABOR RELATIONS
7. Test of legality a) Legal strike i) Purpose and Means Test
There must be concurrence between the validity of the purpose of the strike and the means of conducting it.
Association of Independent Unions in the Philippines (AIUP), et. al. v NLRC (1999): 1) A strike is a legitimate weapon in the universal struggle for existence. 2) It is considered as the most effective weapon in protecting the rights of the employees to improve the terms and conditions of their employment.
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3) 4) 5)
a) b) c)
But to be valid, a strike must be pursued within legal bounds. The right to strike as a means for the attainment of social justice is never meant to oppress or destroy the employer. The law provides limits for its exercise. Among such limits are the prohibited activities under Art. 264, particularly paragraph (e), which states that no person engaged in picketing shall: commit any act of violence, coercion, or intimidation or obstruct the free ingress to or egress from the employer's premises for lawful purposes or obstruct public thoroughfares.
its requirement that it be conducted peaceably, it would be, to repeat, unjustified, considering all the facts disclosed, to stamp the strike with illegality. It is enough that individual liability be incurred by those guilty of such acts of violence that call for loss of employee status. Such an approach is reflected in our recent decisions. iii) Defenses: good faith 1) General Rule: A strike based on nonstrikeable grounds is illegal 2) Exception: Where the employees believe in good faith that ULP acts exist so as to constitute a valid ground to strike.
PNOC Dockyard v. NLRC (1998): 1) Although rejecting the argument that PNOC and its subsidiaries were guilty of discrimination, 2) the NLRC reiterated the policy enunciated in several labor cases "that a strike does not automatically carry the stigma of illegality even if no unfair labor practice were committed by the employer. 3) It suffices if such a belief in good faith is entertained by labor as the inducing factor for staging a strike." 4) The presumption of legality prevails even if the allegation of unfair labor practice is subsequently found to be untrue, provided that the union and its members believed in good faith in the truth of such averment. Malayang Samahan ng mga Manggagawa sa Greenfield v. Ramos (2000): 1) In the instant case, petitioners believed in good faith that in dismissing them upon request by the federation, respondent company was guilty of unfair labor pratice in that it violated the petitioners right to selforganization. 2) The strike was staged to protest respondent companys act of dismissing the union officers. 3) Even if the allegations of unfair labor practice are subsequently found out to be untrue, the presumption of legality of the strike prevails.
LABOR RELATIONS
Phil. Diamond Hotel and Resort, Inc. v. Manila Diamond Hotel Employees Union, 2006). 1) Even if the strike is valid because its objective or purpose is lawful, 2) the strike may still be declared invalid where the means employed are illegal.
ii) Guidelines and Balancing of Interest Shell OilWorkers Union v. Shell Co. of the Phils (1971): 1) A strike otherwise valid, if violent in character, maybe placed beyond the pale. 2) Care is to be taken especially where an unfair labor practice is involved, to avoid stamping it with illegality just because it is tainted by such acts. To avoid rendering illusory the recognition of the right to strike, responsibility in such a case should be individual and not collective. 3) A different conclusion would be called for if the existence of force while the strike lasts is pervasive and widespread, consistently and deliberately resorted to as a matter of policy. It could be reasonably concluded then that even if justified as to ends, it becomes illegal because of the means employed'. 4) This is not by any means to condone the utilization of force by labor to attain its objectives. It is only to show awareness that in labor conflicts, the tension that fills the air as well as the feeling of frustration and bitterness could break out in sporadic acts of violence. 5) If there be in this case a weighing of interests in the balance, the ban the law imposes on unfair labor practices by management that could provoke a strike and
Caveat:
Interwood Employees Assoc. v. Intl Hardwood (1956): 1) A mere claim of good faith would not justify the holding of a strike under the aforesaid exception as, in addition thereto, the circumstances must have warranted such belief.
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2) 3)
It is, therefore, not enough that the union believed that the employer committed acts of ULP when the circumstances clearly negate even a prima facie showing to sustain such belief.
(ii) Effect of illegality Art. 264 (a), 3rd paragraph:

Persons Punishable 1) Any union officer 2) Any union member Acts Punishable Knowingly participates in an illegal strike Knowingly participates in commission of illegal acts during a strike Penalty Termination of employment Termination of employment
b) Illegal strike (i) Basis of illegality See previous notes on Art. 263 (b) and (c)
Manila Diamond Hotel Employees Union v. CA (2007): Noted authority on labor law, Ludwig Teller, lists six (6) categories of an illegal strike, viz.: 1) When it is contrary to a specific prohibition of law, such as strike by employees performing governmental functions; or When it violates a specific requirement of law, such as Article 263 of the Labor Code on the requisites of a valid strike]; or When it is declared for an unlawful purpose, such as inducing the employer to commit an unfair labor practice against nonunion employees; or When it employs unlawful means in the pursuit of its objective, such as a widespread terrorism of non-strikers [for example, prohibited acts under Art. 264(e) of the Labor Code]; or When it is declared in violation of an existing injunction, such as injunction, prohibition, or order issued by the DOLE Secretary and the NLRC under Art. 263 of the Labor Code]; or When it is contrary to an existing agreement, such as a no-strike clause or conclusive arbitration clause.
Jackbilt Industries, Inc. v Jackbilt Employees Workers Union-NAFLU-KMU, March 20, 2009). Q. Is the filing of a petition with the Labor Arbiter to declare a strike illegal a condition sine qua non for the valid termination of employees who commit illegal acts in the course of such strike? A. No. The use of unlawful means in the course of a strike renders the strike illegal. Pursuant to the principle of conclusiveness of judgment, the said strike was ipso facto illegal. The filing of a petition to declare the strike illegal was thus unnecessary Santa Rosa Coca-Cola Plant Employees Union v. Coca-Cola Bottlers Phils., Inc., 2007) 1) The law grants the employer the option of declaring a union officer who participated in an illegal strike as having lost his employment. It possesses the right and prerogative to terminate the union officers from service
LABOR RELATIONS
2) 3)
4)
5)
2)
6)
Steel Corp. of the Phils. v SCP Employees UnionNational Federation of Labor Unions (2008): The strike undertaken by the officers of respondent union is patently illegal for the following reasons: 1) it is a union-recognition-strike which is not sanctioned by labor laws; 2) it was undertaken after the dispute had been certified for compulsory arbitration; and 3) it was in violation of the Secretarys returnto-work order.
Art. 263 (g), 2nd paragraph: Strikes and lockouts in hospitals, clinics and similar medical institutions shall, to every extent possible, be avoided and all serious efforts shall be exhausted to substantially minimize, if not prevent, their adverse effects.
Stamford Marketing Corp. v. Julian (2004): 1) Article 264 of the Labor Code, in providing for the consequences of an illegal strike, makes a distinction between union officers and members who participated thereon. 2) Thus, knowingly participating in an illegal strike is a valid ground for termination from employment of a union officer. 3) The law, however, treats differently mere union members. 4) Mere participation in an illegal strike is not a sufficient ground for termination of the services of the union members. 5) The Labor Code protects an ordinary, rankand-file union member who participated in such a strike from losing his job, provided that he did not commit an illegal act during the strike. Thus, absent any clear, substantial and convincing proof of illegal acts committed during an illegal strike, an ordinary striking worker or employee may not be terminated from work. 6) With respect to union officers, however, there is no dispute they could be dismissed for participating in an illegal strike.
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7)
Union officers are duty-bound to guide their members to respect the law. 8) Nonetheless, as in other termination cases, union officers must be given the required notices for terminating an employment, i.e., notice of hearing to enable them to present their side, and notice of termination, should their explanation prove unsatisfactory. 9) Nothing in Article 264 of the Labor Code authorizes an immediate dismissal of a union officer for participating in an illegal strike. 10) The act of dismissal is not intended to happen ipso facto but rather as an option that can be exercised by the employer and after compliance with the notice requirements for terminating an employee. Toyota Motor Phils. Corp. Workers Association [TMPCWA], 2007) It is necessary for the company to adduce proof of the participation of the striking employees in the commission of illegal acts during the strikes. Philippine Diamond Hotel and Resort, Inc. [Manila Diamond Hotel] v. Manila Diamond Hotel Employees Union, 2006 1) Union members who participated in an illegal strike 2) but were not identified to have committed illegal acts 3) are entitled to be reinstated to their former positions but without backwages.
Art. 263 (g): REQUISITES FOR ASSUMPTION/CERTIFICATION OF SOLE: 1) Labor dispute causing or likely to cause a strike or lockout 2) In an industry indispensable to the national interest. OPTIONS OF THE SOLE: 1) Assume jurisdiction over the dispute and decide it, or 2) Certify the dispute to the NLRC for compulsory arbitration. EFFECT OF ASSUMPTION OR CERTIFICATION: 1) Automatically enjoin the intended or impending strike or lockout as specified in the assumption or certification order. 2) If a strike or lockout has already taken place at the time of assumption or certification a) all striking or locked out employees shall immediately return to work, and b) the employer shall readmit all workers under the same terms and conditions prevailing before the strike or lockout. 3) The SOLE may seek the assistance of law enforcement agencies to ensure the compliance with this provision as well as with such orders as he may issue to enforce the same.
Philcom Employees Union v. Philippine Global Communications and Philcom Corporation, (2006): 1) The powers granted to the Secretary under Article 263(g) have been characterized as an exercise of the police power of the State. 2) When the Secretary exercises these powers, he is granted great breadth of discretion to find a solution to a labor dispute. 3) The most obvious of these powers is the automatic enjoining of an impending strike or lockout or its lifting if one has already taken place. 4) A return-to-work order imposes a duty that must be discharged more than it confers a right that may be waived. 5) While the workers may choose not to obey, they do so at the risk of severing their relationship with their employer. Telefunken Semiconductors Employees Union v. Court of Appeals (1997): 1) The moment the Secretary of Labor assumes jurisdiction over a labor dispute in an industry indispensable to national interest, 2) such assumption shall have the effect of automatically enjoining the intended or impending strike.
LABOR RELATIONS
(iii)Effect of assumption/certification order Art. 264. 1) No strike or lockout shall be declared after assumption of jurisdiction by the President or the Minister 2) or after certification or submission of the dispute to compulsory or voluntary arbitration 3) or during the pendency of cases involving the same grounds for the strike or lockout.
Grand Boulevard Hotel v Grand Labor Organization, (2003): 1) A strike that is held despite the issuance by the SOLE of an assumption or certification order, becomes a prohibited activity pursuant to Article 264 2) As the Court ruled in Union of Filipro Employees v. Nestle Philippines, Inc. (1990), under Article 264(a) of the said code, once an assumption certification order is issued by the SOLE, strikes are enjoined or if one has already taken place, all strikers shall immediately return to work.
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3) 4)
It was not even necessary for the Secretary of Labor to issue another order directing a return to work. The mere issuance of an assumption order by the Secretary of Labor automatically carries with it a return-to-work order, even if the directive to return to work is not expressly stated in the assumption order
B. Picketing 1. Definition, picket line nature, purpose of
c) Employment of strike breakers Art. 264: c. No employer shall use or employ any strike-breaker, nor shall any person be employed as a strike-breaker.
Art. 212(r): "Strike-breaker" a) Means any person who obstructs, impedes, or interferes with by force, violence, coercion, threats, or intimidation b) any peaceful picketing affecting wages, hours or conditions of work or in the exercise of the right of self-organization or collective bargaining.
NCMB Manual of Procedures for Conciliation and Preventive Mediation Cases. Sec. 1: Definition of Terms Picketing the right of workers to peacefully march to and fro before an establishment involved in a labor dispute generally accompanied by the carrying and display of signs, placards and banners intended to inform the public about the dispute.
Security Bank Employees Union v. Security Bank and Trust Co. (1968): 1) Picketing, like other freedom of expression in general, has limits. 2) To the extent that it is an instrument of coercion rather than of persuasion, it cannot rightfully be entitled to the protection associated with free speech. 3) Equally so, there can be no indiscriminate ban on the freedom to disseminate the facts of a labor dispute and to appeal for public sympathy, which is the aim of peaceful picketing, without a transgression of the Constitution, 4) sufficient to oust a court of jurisdiction, even on the assumption that it was originally possessed of such a competence.
LABOR RELATIONS
d) Improved offer balloting and strikes Art. 265: Improved offer balloting Strikes: 1) In an effort to settle a strike, the DOLE shall conduct a referendum by secret ballot on the improved offer of the employer on or before the 30th day of the strike. When at least a majority of the union members vote to accept the improved offer the striking workers shall immediately return to work and the employer shall thereupon readmit them upon the signing of the agreement. Lockouts: 2) In case of a lockout, the DOLE shall also conduct a referendum by secret balloting on the reduced offer of the union on or before the 30th day of the lockout. When at least a majority of the board of directors or trustees or the partners holding the controlling interest in the case of a partnership vote to accept the reduced offer, the workers shall immediately return to work and the employer shall thereupon readmit them upon the signing of the agreement.
2. Picketing and libel laws PCIB V. Philnabank Employees (1981): There is a unique aspect to this action for libel against the Philippine National Bank Employees' Association. It was filed by plaintiff PCIB as a result of placards and signboards along the PNB building in Escolta, Manila, containing the following: "PCIB BAD ACCOUNTS TRANSFERRED TO PNB-NIDC?" There was a labor controversy resulting in a strike, fortunately lasting only for one day. The labor union made use of its constitutional right to picket. From the time of Mortera vs. CIR, a 1947 decision this Court has been committed to the view that' peaceful picketing is part of the freedom of speech guarantee of the Constitution. The latest case in point where such a principle was reaffirmed expressly is Associated Labor Union v. Gomez, a 1980 decision.
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There is no mention of the other placards but it is not unlikely that to bolster its claim, mention was likewise made and in bold letters at that of such alleged failing of its management. That was the aim and intent as found by the lower court. That could not very well be disputed by plaintiffappellant. Unfortunately, the offending imputation, but in the form of a question, was included. It was due to a former official of plaintiff appellant's bank who was thereafter named as President of the Philippine National Bank. Should there be an automatic attitude of condemnation for such incident? If the realistic observation of Justice Frankfurter in Milk Wagon Drivers Union of Chicago v. Meadowmoor Dairies be heeded that labor disputes give rise to strong emotional response, then the decision reached by the lower court becomes even more acceptable. It is a fact of industrial life, both in the Philippines as in the United States, that in the continuing confrontation between labor and management, it is far from likely that the language employed would be both courteous and polite. Such being the case, there is no affront either to reason or to the law in the complaint for libel being dismissed. In placing reliance on the constitutional right of freedom of expression, this Court once again makes manifest its adherence to the principle first announced by Justice Malcolm as ponente in the leading case of United States v. Bustos. In no uncertain terms, it made clear that the judiciary, in deciding suits for libel, must ascertain whether or not the alleged offending words may be embraced by the guarantees of free speech and free press. It cannot be too often said that Bustos was promulgated as far back as March 8, 1918. 3. Curtailment
Free Telephone Workers Union v. PLDT Co. (1982): 1) Peaceful picketing cannot be restrained because the same is part of the freedom of speech. 2) However, petitioner fails to realize that the questioned July 16, 1965 order of the Court of Industrial Relations did not refer to peaceful picketing. 3) In Mortera (supra), where the therein questioned order partly declared that ". . .
4)
5)
6)
7)
picketing under any guise and form is hereby prohibited . . .," this Court ruled that the "order of the Court of Industrial Relations prohibiting picketing must be understood to refer only to illegal picketing, that is, picketing through the use of illegal means. In this case, the questioned restraining order should also be taken as limited to the lifting of the picket lines which constituted illegal picketing especially so because it expressly stated that the petitioner union and its officers, agents or symphatizers "are hereby directed to call off the strike declared on July 17, 1965, and to lift the picket lines established in and around the premises of respondent company's various offices and installations xxx The persons manning the picket lines in these places are hereby enjoined from impeding and interfering with implementation of this Order as well as from interfering in any manner with the operations of respondent.
LABOR RELATIONS
4. Regulation/restrictions, innocent third party rule and liabilities

Liwayway Publishing Co. v. Permanent Concrete Workers Union (1981): GENERAL RULE 1) In PAFLU V. Cloribel (1969), the Court held that the right to picket as a means of communicating the facts of a labor dispute is a phase of the freedom of speech guaranteed by the constitution. 2) If peacefully carried out, it cannot be curtailed even in the absence of employeremployee relationship. EXCEPTION 1) The right is, however, not an absolute one. 2) While peaceful picketing is entitled to protection as an exercise of free speech, 3) we believe that courts are not without power to confine or localize the sphere of communication or the demonstration to the parties to the labor dispute, including those with related interest, 4) and to insulate establishments or persons with no industrial connection or having interest totally foreign to the context of the dispute. THUS, THE RIGHT MAY BE REGULATED AT THE INSTANCE OF THIRD PARTIES OR 'INNOCENT BYSTANDERS' IF: 1) it appears that the inevitable result of its exercise is to create an impression that a labor dispute with which they have no connection or interest exists between them, and 2) the picketing union or constitute an invasion of their rights. RATIONALE
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1)
2) 3)
Mere innocent bystanders are entitled to seek protection of their rights from the courts and the courts may, accordingly, legally extend the same. The picket is merely regulated to protect the rights of third parties. If the law fails to afford said protection, men will endeavor to safeguard their rights by their own might, take the law in their own hands, and commit acts which lead to breaches of the law. This should not be allowed to happen."
III.Role of peace officers during strikes and picketing

A. Escorting Art. 264 (d) 1) No public official or employee, including officers and personnel of the AFP or the Integrated National Police, or armed person a) shall bring in, introduce or escort in any manner, b) any individual who seeks to replace strikers in entering or leaving the premises of a strike area, or work in place of the strikers. 2) The police force shall keep out of the picket lines unless actual violence or other criminal acts occur therein: 3) Provided, That nothing herein shall be interpreted to prevent any public officer from taking any measure necessary to maintain peace and order, protect life and property, and/or enforce the law and legal order. B. Arrest and detention of law violators Art. 266 1) GENERAL RULE: No union members or union organizers may be arrested or detained for union activities without previous consultations with the Secretary of Labor. 2) EXCEPTION: a) On grounds of national security and public peace, or b) In case of commission of a crime. CONFLICT OF INTEREST: 1) Insofar as practicable, no officer of the law shall be allowed to render services in connection with a strike or lockout 2) if there is question or complaint as regards his relationship by affinity or consanguinity to any official/leader of the parties in the controversy or if he has financial or pecuniary interest therein.
MSF Tire and Rubber Inc. v. CA, 1999 1) An "innocent bystander," who seeks to enjoin a labor strike, 2) must satisfy the court that aside from the grounds specified in Rule 58 of the Rules of Court, 3) it is entirely different from, without any connection whatsoever to, either party to the dispute and, 4) its interests are totally foreign to the context thereof.
LABOR RELATIONS
ABSENCE OF EMPLOYER-EMPLOYEE RELATIONSHIP:

De Leon v. National Labor Union, 1957 1) Picketing, peacefully carried out, is not illegal even in the absence of employeremployee relationship, 2) for peaceful picketing is a part of the freedom of speech guaranteed by the Constitution.
5. Prohibited activities; peaceful picketing Art. 264 (b): No person shall: a) Obstruct, impede, or interfere with, by force, violence, coercion, threats or intimidation, any peaceful picketing by employees during any labor controversy or in the exercise of the right to selforganization or collective bargaining, or b) Aid or abet such obstruction or interference.
C. Slowdown
Ilaw at Buklod ng Manggagawa (IBM) v. NLRC, 1991 1) A slowdown is inherently illicit and unjustifiable 2) because while the employees continue to work, 3) they, at the same time, select what part of their duties they perform. 4) In essence, they work on their own terms.
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Chapter 8. Employer Lockout
Chapter 8. Employer Lockout

I. II. III. IV. V. Basis, definition, limitation Ground for lockout Prohibited lockout Procedural requirements Effect of illegal lockout
lockout vote first having been obtained and reported to the Department. 2) No strike or lockout shall be declared after assumption of jurisdiction by the President or the Secretary or after certification or submission of the dispute to compulsory or voluntary arbitration or during the pendency of cases involving the same grounds for the strike or lockout. 3) Any union officer who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status: PROVIDED, That mere participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his employment, even if a replacement had been hired by the employer during such lawful strike.
I. Definition
Art. 212 (p): Lockout: the temporary refusal of an employer to furnish work as a result of an industrial or labor dispute.
LABOR RELATIONS
II. Ground for Lockout

Art. 263 (c): Strikes, picketing and lockouts Bargaining Deadlocks: In case of bargaining deadlocks, the duly certified or recognized bargaining agent may file a notice of strike or the employer may file a notice of lockout with the Department at least 30 days before the intended date thereof. ULP: a) In cases of unfair labor practice, the period of notice shall be 15 days. b) In the absence of a duly certified or recognized bargaining agent, the notice of strike may be filed by any legitimate labor organization in behalf of its members. c) In case of dismissal from employment of union officers duly elected in accordance with the union constitution and by-laws, which may constitute union busting, where the existence of the union is threatened, the 15-day cooling-off period shall not apply and the union may take action immediately.
IV. Procedural Requirements

Note: For the procedural requirements and additional details, please see the discussion on Strikes in Chapter 8 Part III (7).
V. Effect of Illegal Lockout

Art. 264 (a), par. 3, 1st sentence Any worker whose employment has been terminated as a consequence of any unlawful lockout shall be entitled to reinstatement with full backwages.
III.Prohibited Lockout
Art. 263 (b), last sentence: No labor union may strike and no employer may declare a lockout on grounds involving inter-union and intra-union disputes. Art. 264 (a): 1) No labor organization or employer shall declare a strike or lockout without first having: a) Bargained collectively in accordance with Title VII of this Book, or b) Filed the notice required in the preceding Article or without the necessary strike or
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Chapter 9. Labor Injunction

I. Definition and Nature II. General Rule and Exception IIII. Issuing Agency; Procedural Requirements A. NLRC; Labor Arbiter B. Procedural requirements and rules for issuance of labor injunctions C. TRO
showing of any urgency or irreparable injury which the private respondents might suffer.
I. Definition and Nature

Philippine Airlines, Inc. v. NLRC (1998): 1) 2) 3) GENERALLY, injunction is a preservative remedy for the protection of one's substantive rights or interest. It is not a cause of action in itself but merely a provisional remedy, an adjunct to a main suit. It is resorted to only when there is a pressing necessity to avoid injurious consequences which cannot be remedied under any standard of compensation. The application of the injunctive writ rests upon the existence of an emergency or of a special reason before the main case be regularly heard. The essential conditions for granting such temporary injunctive relief are: that the complaint alleges facts which appear to be sufficient to constitute a proper basis for injunction and that on the entire showing from the contending parties, the injunction is reasonably necessary to protect the legal rights of the plaintiff pending the litigation. Injunction is also a special equitable relief granted only in cases where there is no plain, adequate and complete remedy at law. The foregoing ancillary power may be exercised by the Labor Arbiters: ONLY as an INCIDENT to the cases pending before them in order to preserve the rights of the parties during the pendency of the case, BUT excluding labor disputes involving strikes or lockout. Why does injunction not apply to the facts of this case? In the present case, there is no labor dispute between the petitioner and private respondents as there has yet been no complaint for illegal dismissal filed with the labor arbiter by the private respondents against the petitioner. Furthermore, an examination of private respondents' petition for injunction reveals that it has no basis since there is no
IRREPARABLE INJURY 1) It is of such constant and frequent recurrence that no fair and reasonable redress can be had therefor in a court of law; or 2) No standard by which their amount can be measured with reasonable accuracy, that is, it is not susceptible of mathematical computation. 3) It cannot be adequately compensated in damages due to the nature of the injury itself or the nature of the right or property injured or when there exists no certain pecuniary standard for the measurement of damages.
LABOR RELATIONS
II. General Rule and Exception

GENERAL RULE Art. 254: "No temporary or permanent injunction or restraining order in any case involving or growing out of labor disputes shall be issued by any court or other entity. EXCEPTIONS 1) Art. 264: specific "prohibited activities" which may be forbidden or stopped by a restraining order or injunction. 2) Art. 218 (e): Power of the NLRC to enjoin or restrain commission of prohibited or unlawful acts or to require performance of a particular act in any labor dispute which, if not restrained or performed forthwith, may cause grave or irreparable damage to any party or render ineffectual any decision in favor of such party. Art. 263 (g) the SOLE or Commission may seek the assistance of law enforcement agencies to ensure compliance with this provision as well as with such orders as he may issue to enforce the same. (IRR, Book V, Rule XXII, Sec. 14)
4)
5) a. b.
6)
3)
7) a. b. 8) a.
POLICY BEHIND PROHIBITION ISSUANCE OF INJUNCTION:
OF
b.
1) It has been the policy of the State to encourage the parties to use the nonjudicial process of negotiation and compromise, mediation and arbitration. 2) Thus, injunctions may be issued only a. in cases of extreme necessity b. based on legal grounds clearly established, c. after due consultations or hearing d. and when all efforts at conciliation are exhausted.
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RATIONALE for Prohibition:

Caltex Filipino Managers and Supervisors Assoc. v. CIR (1972): 1) The scheme in Republic Act No. 875 for achieving industrial peace rests essentially on a FREE AND PRIVATE AGREEMENT between the employer and his employees as to the terms and conditions of employment, unhampered as far as possible by judicial or administrative intervention. On this premise the lawmaking body has virtually prohibited the issuance of injunctive relief involving or growing out of labor disputes. The prohibition to issue labor injunctions is designed to give labor a comparable bargaining power with capital and must be liberally construed to that end.
damage to any party or render ineffectual any decision in favor of such party xxx" National Mines and Allied Workers v. Vera (1984): 1) Simply because a writ of execution was issued by the NLRC does not authorize the sheriff implementing the same to levy on anybody's property. To deny the victim of the wrongful levy, the recourse such as that availed of by the private respondents, under the pretext that no court of general jurisdiction can interfere with the writ of execution issued in a labor dispute, will be sanctioning a greater evil than that sought to be avoided by the Labor Code provision in question. Certainly, that could not have been the intendment of the law creating the NLRC. Well-settled is the rule that the power of a court to execute its judgment extends only over properties unquestionably belonging to the judgment debtor.
2)
2)
LABOR RELATIONS
2)
3) 4)
INJUNCTION ON STRIKES GENERAL RULE

There can be no injunction issued against any strike.
EXCEPTION
When a labor dispute arises in an INDUSTRY INDISPENSABLE TO THE NATIONAL INTEREST and such dispute is CERTIFIED BY THE PRESIDENT of the Philippines to the Court of Industrial Relations in compliance with Sec. 10 of Republic Act No. 875.
III.Issuing Agency; Procedural Requirements

A. NLRC; Labor Arbiter Art. 218: Powers of the NLRC (e), 1st sentence: To enjoin or restrain any actual or threatened commission of any or all prohibited or unlawful acts or to require the performance of a particular act in any labor dispute which, if not restrained or performed forthwith, may cause grave or irreparable damage to any party or render ineffectual any decision in favor of such party. Nestle Philippinesm Inc. V NLRC, 195 SCRA 340 (1991): The power of the NLRC to enjoin or restrain the commission of any or all prohibited or unlawful acts as provided in Art. 218, can only be exercised in a labor dispute. B. Procedural Requirements and Rules for Issuance of Labor Injunctions Art. 218 (e): Requisites:
a. Complaint made under oath b. Notice of hearing duly served to: all known persons against whom relief is sought, Chief Executive, and
1) Purpose of an injunction in an UNCERTIFIED case: a. As a corollary to this, an injunction in an uncertified case must be based on the strict requirements of Sec. 9(d) of Republic Act No. 875; b. the purpose of such an injunction is not to enjoin the strike itself, but only unlawful activities. NOTES: Labor Injunction is not the same as the injunction under the rules of court.
Ilaw at Buklod ng Manggagawa v. NLRC (1991): 1) 2) 3) 4) Among the powers expressly conferred on the NLRC by Article 218 is the power to "enjoin or restrain any actual or threatened commission of any or all prohibited or unlawful acts or to require the performance of a particular act in any labor dispute which if not restrained or performed forthwith, may cause grave or irreparable
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Other public officials of the province or city within which the unlawful acts have been threatened or committed charged with the duty to protect the complainants property. c. Hearing d. A finding of fact by the Commission that: Prohibited or unlawful acts have been threatened and will be committed and will be continued unless restrained Substantial and irreparable injury to complainants property will
follow; Greater injury will be inflicted upon complainant if the relief is denied; Complainant has no adequate remedy at law; and Public officers charged with the duty to protect complainants property are unable or unwilling to furnish adequate protection.
in issuing a temporary injunction upon hearing after notice. c. Filing of undertaking with adequate security in an amount to be fixed by the Commission sufficient to recompense those enjoined for: any loss, expense or damage caused by the improvident or erroneous issuance of such order or injunction, reasonable attorneys fees, expense of defense against the order or against the granting of any injunctive relief sought in the same proceeding and subsequently denied by the Commission; all other reasonable costs d. The TRO shall be effected for no longer than 20 days and shall become void ipso facto upon expiration of said period.
SC Administrative Circular 20-95, par. 3; Manotoc v Agcaoili, A.M. No. RTJ-98-1405, April 12, 2000. The TRO takes effect upon its issuance and not upon receipt of the parties. Bisig ng Manggagawa, etc. v. NLRC (1993): 1) The issuance of an ex parte temporary restraining order in a labor dispute is not per se prohibited. 2) Its issuance, however, should be characterized by care and caution for the law requires that it be clearly justified by considerations of EXTREME NECESSITY, a) when the commission of unlawful acts is causing substantial and irreparable injury to company properties, and b) the company is, for the moment, bereft of an adequate remedy at law. 3) This is as it ought to be, for imprudently issued temporary restraining orders can break the back of employees engaged in a legal strike.
LABOR RELATIONS
e. But no injunction or temporary restraining order shall be issued on account of any threat, prohibited or unlawful act, f. Except against the person or persons, association or organization making the threat or committing the prohibited or unlawful act or actually authorizing or ratifying the same after actual knowledge thereof;
Role of the Labor Arbiter (Book V Rule XXI sec. 13) i. The reception of evidence for the application of the writ of injunction ii. may be delegated by the Commission to any Labor Arbiter iii. who shall submit his recommendations to the Commissions for its consideration and resolution.
C. Temporary Restraining Order

Conditions for Issuance Ex Parte of a TRO (valid for 20 days) Art. 218 (e) a. Allegation that unless a TRO shall be issues without notice, a substantial and irreparable injury to his/her property will be unavoidable. b. Testimony under oath, sufficient, if sustained, to justify the Commission
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Chapter 10. Labor Relations in Public Sector

EO 180: EXERCISE OF THE RIGHT TO ORGANIZE OF GOVERNMENT EMPLOYEES 1. Covered Employees Sec. 1. This Executive Order applies to ALL employees of ALL Government 1) Branches, 2) Subdivisions, 3) Instrumentalities, and Agencies, 4) including government-owned or controlled corporations (GOCCs) with original charters. Sec. 3. High-level government employees 1) Whose functions are normally considered as policy-making or managerial; or 2) Whose duties are of a highly confidential nature 3) shall NOT be eligible to join the organization of rank-and-file government employees. EXCLUDED EMPLOYEES Sec. 4. Members of the Armed Forces of the Philippines, including police officers, policemen, firemen and jail guards. 2. Rights of Government Employees a) Sec. 2 To form, join or assist employees organizations of their own choosing for the furtherance and protection of their interests. b) Sec.3 To form labor-management committees, works councils and other forms of workers' participation schemes. c) Sec.5 Not to be discriminated against in respect of their employment by reason of their membership in employees' organizations or participation in the normal activities of their organization. d) Sec. 6. To be free from interference in the establishment, functioning or administration of government employees' organizations.
3. Registration of Employees Organization VENUE FOR REGISTRATION: Civil Service Commission (CSC) and Department of Labor and Employment (DOLE). PROCESS: a) Application shall be filed with the Bureau of Labor Relations (BLR) or with the Regional Offices of the DOLE. (Sec. 7) b) If the application is filed with the DOLE Regional Office, the latter shall immediately transmit the application to the BLR within 3 days from receipt thereof. (Sec. 7) c) Upon approval of the application, a registration certificate shall be issued to the organization recognizing it as a legitimate employees' organization, with the right to: Represent its members; and Undertake activities to further and defend its interest. (Sec. 8) d) The certificates of registration shall be jointly approved by the Chairman of the Civil Service Commission and Secretary of Labor and Employment. 4. Sole and Exclusive Representatives Employees'
LABOR RELATIONS
APPROPRIATE ORGANIZATIONAL UNIT 1) Definition: the unit consisting of rankand-file employees unless circumstances otherwise require. (Sec. 9) 2) The duly registered employees' organization having the support of the majority of the employees in the appropriate organizational unit 3) shall be designated as the sole and exclusive representative of the employees. (Sec. 10) VOLUNTARY RECOGNITION OF EMPLOYEES ORGANIZATION Sec. 11. Requisites: 1) Duly registered 2) No other employees' organization is registered or is seeking registration 3) Majority support of the rank-and-file employees in the organizational unit.
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Sec. 12. Where there are 2 or more duly registered employees' organizations in the appropriate organizational unit, the BLR shall: 1) upon petition, 2) order the conduct of a certification election, and 3) certify the winner as the exclusive representative of the rank-and-file employees in said organization unit. 5. Peaceful Concerted Activities and Strikes Sec. 14. 1) Civil Service laws and rules governing concerted activities and strikes in the government service shall be observed, 2) subject to any legislation that may be enacted by Congress. 6. Settlement of Disputes Sec. 16. 1) Civil Service and labor laws and procedures, whenever applicable, shall be followed in the resolution of: a) Complaints, b) Grievances, and c) Cases involving government employees. 2) If the dispute remains unresolved after exhausting all available remedies under existing laws and procedures, the parties may jointly refer the dispute to the Council, for appropriate action.
LABOR RELATIONS
- end of Labor Relations -
- end of Labor Law & Social Legislation -
Page 161 of 161

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2009 Labor Law Reviewer

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REVIEWER IN LABOR LAW

REVIEWER IN LABOR LAW

REVIEWER IN LABOR LAW

REVIEWER IN LABOR LAW

REVIEWER IN LABOR LAW

REVIEWER IN LABOR LAW

REVIEWER IN LABOR LAW

REVIEWER IN LABOR LAW

REVIEWER IN LABOR LAW

Chapter 1. Introduction to Labor Law

FACULTY-STUDENT EDITORIAL BOARD AND LECTURES COMMITTEE Prof. E. (Leo) Battad

LABOR & SOCIAL LEGISLATION Fame Cruz

LECTURES Edel Cruz

ACADEMICS COMMITTEE Samantha Poblacion

LABOR STANDARDS Patrich Leccio

Niner Guiao Jake del Puerto Sopfia Guira

Chapter 1. Introduction to Labor Law

REVIEWER IN LABOR LAW

Chapter 1. Introduction to Labor Law

4. Compromise and Waiver

II. CONSTITUTION LAW

REVIEWER IN LABOR LAW

Chapter 1. Introduction to Labor Law

REVIEWER IN LABOR LAW

Chapter 1. Introduction to Labor Law

LABOR AND CIVIL CODE

REVIEWER IN LABOR LAW

Chapter 1. Introduction to Labor Law

IV.LABOR INTERNATIONAL LAW AND LABOR

V. THE LABOR CODE OF THE PHILIPPINES

REVIEWER IN LABOR LAW

Chapter 1. Introduction to Labor Law

D. LIBERAL INTERPRETATION OF THE LAW

REVIEWER IN LABOR LAW

Chapter 1. Introduction to Labor Law

REVIEWER IN LABOR LAW

Chapter 2. Existence of Employment Relationship

Chapter 2. Existence of Employment Relationship

II. EMPLOYER-EMPLOYEE RELATIONSHIP

REVIEWER IN LABOR LAW

Chapter 2. Existence of Employment Relationship

REVIEWER IN LABOR LAW

Chapter 2. Existence of Employment Relationship

REVIEWER IN LABOR LAW

Chapter 2. Existence of Employment Relationship

III.INDEPENDENT CONTRACTOR AND LABOR-ONLY CONTRACTOR

B. INDEPENDENT CONTRACTOR: 1. Requisites

REVIEWER IN LABOR LAW

Chapter 2. Existence of Employment Relationship

C. LABOR-ONLY CONTRACTOR 1. Requisites

REVIEWER IN LABOR LAW

Chapter 2. Existence of Employment Relationship

REVIEWER IN LABOR LAW

Chapter 2. Existence of Employment Relationship

REVIEWER IN LABOR LAW

Chapter 3. Employee Classification

Chapter 3. Employee Classification

I. STATUTORY BASIS/ OVERVIEW OF CLASSIFICATION

REVIEWER IN LABOR LAW

Chapter 3. Employee Classification

II. REGULAR EMPLOYEES

REVIEWER IN LABOR LAW

Chapter 3. Employee Classification