UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
I. Introduction
Labor Law_ It is the law governing the rights and duties of ER
and EE [a] with respect to the terms and conditions of
employment, and [b] with respect to labor disputes arising
from collective bargaining respecting such terms and
conditions.
3 Branches
3 branches:
1. Labor Standards
2. Labor Relations
3. Welfare Legislation
Labor Standards
- Labor standards provide the working conditions of
employees, including entitlement to overtime pay
and premium pay for working on rest days.
Penaranda v Baganga Plywood Corp., 489 SCRA 94
(2006)
- Labor standards refers to the 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.
Batong Buhay Goldmines Inc v dela Serna, 312 SCRA
22 (1999)
Basis for Enactment of Labor Law
1. The Constitution
Art.II.5(1987 Consti): 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.18 (1987 Consti): The State affirms labor as a primary
social economic force. It shall protect the rights of workers
and promote their welfare.
2. Police Power: The [SSS Law] implements the general
welfare mandate of the Constitution and constitutes a
legitimate exercise of the police power of the State.
CMS Estate Inc v Social Security System, 132 SCRA 106
(1984)
Sources of Law
A. Labor Code, IRR
B. Contract
-The MOA, being a contract freely entered into by the parties,
now constitutes as the law between them, and the
interpretation of its contents purely involves an evaluation of
the law as applied to the facts herein. Kasapian ng Malayang
Manggagawa sa Coca-Cola v. CA
C. CBA
-The CBA is the norm of conduct between the parties and
compliance therewith is mandated by the express policy of
the law. DOLE Phils. v. Pawis ng Makabayang Obrero, 395
SCRA 112 (2003)
D. Past Practices (company practices) – Requisites to
be a source of rights and obligations
1. freely, voluntarily and continuously given within a
considerable length of time Davao Fruits Corp v Associated
Labor Union, 225 SCRA 562 (1993)
2. not just a single instance (not granted only once)
Samahang Manggagawa etc. v. NLRC, 295 SCRA 171 (1998)
3. should have been done over a long period of time and must
be shown to have been consistent and deliberate
(American Wire and Cable Daily Rated Employees Union v.
American Wire and Cable Co, Inc., 457 SCRA 684 (2005)
4. not be by reason of a strict legal or contractual obligation,
but by reason of an act of liberality on the part of the
employer Pag-asa Steel Works, Inc. v. CA, 486 SCRA 475
(2006)
E. Company Policies
-generally binding and valid on the parties and must be
complied with until finally revised/amended unilaterally or
preferably through negotiation by competent authority (unless
shown to be grossly oppressive or contrary to law) China
Banking Corporation v. Borromeo, 440 SCRA 622 (2004)
WON Labor Case Lapanday Agricultural Development
Corporation v. CA, 324 SCRA 77 (2001)
[a] presence of ER-EE relationship
[b] there’s a violation of the Labor Code (LC).
…Other than these, it is not a labor case. LC is the regulatory
law; there must be strict interpretation.
Management Function/ Management Prerogative
- It is the employer’s prerogative to prescribe reasonable rules
and regulations necessary or proper for the conduct of its
business or concern to provide certain disciplinary measures
to implement said rules and to assure that the same be
complied with. At the same time, it is one of the fundamental
duties of the employee to yield obedience to all reasonable
rules, orders, and instructions of the employer, and willful or
intentional disobedience thereof, as a general rule, justifies
rescission of the contract of service and the preemptory
dismissal of the employee. Gustilo v. Wyeth Philippines Inc.,
440 SCRA 67 (2004)
-The Court has always respected a company’s exercise of its
prerogative to devise means to improve its operations.
Thus, it has held that management is free to regulate,
according to its own discretion and judgment, all aspects of
employment, including hiring, work assignments, supervision
and transfer of employees, working methods, time, place and
manner of work Philcor Employees Union v. Phil.Global
Communications, 495 SCRA 214 (2006)
Limitations to Management Prerogative
1. Law, CBA, fair play and justice DOLE Philippines, Inc.
v. Pawis, 395 SCRA 112 (2003)
2. Even as the law is solicitous of the welfare of
employees, it must also protect the rights of an
employer to exercise what are clearly management
prerogatives. As long as the company’s exercise of
those rights and prerogatives is in good faith to
advance its interest and not for the purpose of
defeating or circumventing the rights of
employees under the laws or valid agreements,
such exercise will be upheld. Valiao v. CA, 435 SCRA
543 (2004)
Compromise and Waiver Periquet v NLRC, 186 SCRA 724
(1990)
1. The law frowns upon waivers and compromise as a general
principal because it is subject to abuse (Law recognizes that
the situation is not of even or equal terms bet. ER and EE.
Principle is grounded on fair play)
2. But not all C & W are void or contrary to law (Labor law not
meant to oppress ERs. Just as it protects EEs, it also protects
ERs. There’s a shared responsibility: EEs’ right to the fruits of
their labor, and Er’s rights to the return of their investment)
3. There is a test to determine the validity of C & W:
[a] Voluntarily entered into
[b] Proximate equality, no moral ascendancy over
the other
[c] Amount is reasonable and not unconscionable
II. Labor and Constitution
Labor Sector
-characterized as the primary social economic force
[ArtIi.18, 1987 Constitution)
UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
Protection of Labor_ 7 basic rights of labor under
ArtXIII.3…right to
1. organize
2. conduct collective bargaining or negotiation with
management
3. engage in peaceful concerted activities including
strike in accordance with law
4. enjoy security of tenure
5. work under humane conditions
6. receive a living wage
7. participate in policy and decision-making processes
affecting their rights and benefits as may be
provided by law
Social Justice [ArtXIII.1)
-humanization of laws and the equalization of social and
economic forces by the State so that justice in its rational and
objective secular conception may at least be approximated
Calalang v. Williams, 70 Phil 726 (1940)
-Limitation: not intended to countenance wrongdoing simply
because it is committed by the underprivileged. Compassion
for the poor is an imperative of every humane society but only
when the recipient is not a rascal claiming an undeserved
privilege PLDT v. NLRC, 164 SCRA 671 (1988)
Management and the Constitution
GR: Consti protect and promote welfare of EE
X: when the ER is right (EE wrong).
-Law, in protecting rights of labor, authorized neither
oppression nor self-destruction of an employer company
which itself is possessed of rights that must be entitled to
recognition and respect Dayan v BPI, 369 SCRA 712
(2001)
-Constitutional policy for full protection of labor is not a sword
to oppress employers. Agabon v. NLRC, 442 SCRA 573
(2004)
Labor as Property
-A worker’s employment is property in the constitutional
sense. He cannot be deprived of his work without due
process. Asuncion v. NLRC, 362 SCRA 56 (2001)
Due Process Requirements
Ang Tibay v. CIR, 59 Phil 635 (1940): Procedural Due Process
Requirements
1. Right to a hearing. Includes the right of a part to present
his own case and submit evidence in support thereof.
2. The tribunal must consider the evidence presented.
3. Decision must be supported by evidence.
4. Evidence must be substantial; i.e. more than a mere
scintilla, such relevant evidence as a reasonable mind
might accept as adequate to support a conclusion, even if
other minds equally reasonable would opine otherwise.
5. Decision must be rendered on the evidence presented at
the hearing or at least contained in the record and disclosed
to the parties affected.
Only by confining the administrative tribunal to the evidence
disclosed to the parties, can the latter be protected in their
right to know and meet the case against them.
6. Independent consideration of judge. Must not simply
accept the views of a subordinate in arriving at a decision.
7. Decision rendered in such a manner as to let the parties
know the various issues involved and the reasons for the
decision rendered.
+
8. a tribunal so constituted as to give him reasonable
assurance of honesty and impartiality, and one of
competent jurisdiction Air Manila Inc. v. Balatbat
9. specially for termination cases: twin notice rule Agabon v.
NLRC, 442 SCRA 573 (2004)
Liberty of Contract and State Interference
-State still exercises control/power to interfere where the
parties are not equal in standing Leyte Land Transportation
Co v. Leyte Farmers and Workers Union, 80 Phil 842 (1948)
- The prohibition on impairment of obligations by Statute is
not unqualified. It prohibits only unreasonable impairment.
In spite of the constitutional prohibition, the State continues
to possess authority to safeguard the vital interests of the
people. Xxx This has special application to contract
regulating relations between capital and labor which are not
merely contractual, and said labor contracts, for being
impressed with public interest, must yield to the common
good Victoriano v. Elizalde Rope Workers Union, 59 SCRA
54 (1974)
Welfare State
-The welfare state concept is not alien to the philosophy our
Constitution. It is implicit in quite a few of its provisions.
There is the clause on the promotion of social justice to
ensure the wellbeing and economic security of all the people,
as well as the pledge of protection to labor with the specific
authority to regulate the relations between landowners and
tenants and between labor and capital. Alalayan v. NPC, 24
SCRA 172 (1968)
III. Labor and the Civil Code
Labor Contracts
Art 1700: Relations between capital and labor are not merely
contractual; impressed with public interest that labor
contracts must yield to the common good
EE-ER Standard of Conduct
Art 1701:
a) Not act oppressively against the other,
b) nor impair the interest or convenience of the public
mutual obligation
-The ER’s obligation to give his EE’s just compensation and
treatment carries with it the corollary right to expect from the
EE adequate work, diligence and good conduct Firestone Tire
and Rubber, Co v. Lariosa, 148 SCRA 187 (1987)
EE obedience and Compliance of ER Orders
-Any EE who is entrusted with responsibility by his employer
should perform the task assigned to him with care and
dedication. PCIB v Jacinto, 196 SCRA 687 (1991)
IV. Labor and International Covenants
1. Universal Declaration of Human Rights
2. International Covenant on Economic, Social and Cultural
Rights
3. Conventions and Recommendations of the International
Labor Organization
*Generally, these conventions recognize the rights already
enumerated in our Constitution, such as:
(a) Right to work, free choice of employment
(b) Equal pay for equal work (prevent discrimination): Persons
who work with substantially equal qualifications, skill, effort
and responsibility, under similar conditions, should be paid
similar salaries. International School Alliance of Educators v.
Quisumbing, 333 SCRA 13 (2000)
(c) Just, favorable renumeration
(d) right to self-organization
Labor Code of the Philippines
Applicability of Labor Code – Art.6
GR: Applies alike to ALL workers, whether agricultural or
nonagricultural
-EE-ER Important: It is jurisdictional for provisions of LC on
post-employment to apply Uy v. Bueno, 484 SCRA 628 (2006)
X: as may otherwise be provided herein
UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
*Special rules* The sympathy of the Court is on the side of the laboring
GOCCs Cabrera v. NLRC (1991): Important how created classes, not only because the Constitution imposes sympathy
-if with original charter: Civil Service Law apply but because of the one-sided relation between labor and
-if incorporated under the Corporation Code: LC applies capital. The Court must take care, however, that in the
*but in terms of wages: LC applies to all contest between labor and capital, the results achieved are
fair and in conformity with the rules. Duncan Association v.
International Organizations: Glaxo Welcome, 438 SCRA 343 (2004)
-GR: LC not applicable. The grant of immunity from local
jurisdiction to the IO is clearly necessitated by their VI. Work Relationship
international character and respective purposes. The *note that the definition of EE-ER differ depending on what
objective is to avoid the danger of partiality and interference part of the labor code you’re looking at
by the host country in their internal workings. The exercise of
jurisdiction by the DOLE in these instances would defeat the ER EE
very purpose of immunity, which is to shield the affairs of Wages (Art -includes any person any individual
international organizations, in accordance with international 97) acting directly or employed by an
practice, from political pressure or control by the host country indirectly in the employer.
to the prejudice of the member State of the organization, and interest of an
to ensure the unhampered performance of their functions employer in relation
Ebro III v. NLRC to an employee and
-X: If there’s abuse or any injustice created due to this shall include the
exemption from suit, the remedy of EE is to ask Phils. to government and all its
withdraw the grant of immunity from suit. Then the legal branches, subdivisions
processes and provisions of law in the Phils will apply. and instrumentalities,
all government-owned
School Teachers or controlled
Public School Teachers: Civil Service Law corporations and
Private School Teachers: on issue of security of tenure institutions, as well as
(permanent status determination), the Manual for Private non-profit private
School issued by by the DECS applies and not LC. Labor Code institutions, or
however, is suppletory. Chiang Kai Shek College v. CA, 437 organizations.
SCRA 171 (2004) ER’s any person, natural or any person
Compensati juridical, employing compulsorily covered
Religious Corporations on and the services of the by the GSIS under
-if ecclestiastical affairs: LC cannot apply State employee. Commonwealth Act
-if not ecclesiastical affairs: LC can apply Insurance Numbered One
*Ecclesiastical affairs: It involves the relationship between the Fund hundred eighty-six,
church and its members and relate to the matters of faith, (Art167) as amended,
religious doctrines, worship and governance of the including the
congregation Austria v. NLRC, 312 SCRA 410 (1999)) members of the
Armed Forces of the
Philippines, and any
Rule Making Power – Art. 5 person employed as
-DOLE as lead agency in enforing laws, possesses rule-making casual, emergency,
in the enforcement of the LC temporary, substitute
-A rule or regulation that exceeds the DOLE’s rule-making or contractual, or any
authority is void person compulsorily
covered by the SSS
Law Interpretation – Art.4 under Republic Act
1. If there’s NO doubt, and the language o the law is clear and Numbered Eleven
unambiguous, there’s no room for interpretation hundred sixty-one, as
2. If there’s DOUBT, then resolve in favor of labor (liberal amended.
construction). There’s doubt when the law is susceptible to 2 Labor any person acting in any person in the
or more interpretation, both or all of which are correct. Relations the interest of an employ of an
(Art212) employer, directly or employer. The term
Rationale: to give life and meaning to the compassion and indirectly. The term shall not be limited to
liberal spirit of the law, and to extend its applicability to a shall not include any the employees of a
greater number of EEs who can avail of the benefits under the labor organization or particular employer,
law. Abella v. NLRC, 152 SCRA 140 (1987) any of its officers or unless the Code so
agents except when explicitly states. It
Equity and Moral Consideration acting as employer. shall include any
-Equity has been defined as justice outside law, individual whose work
being ethical rather than jural or belonging to the sphere of has ceased as a
morals than law. It is grounded on precepts of conscience and result of or in
not on any sanction of positive law. However, considerations connection with any
of equity and social justice” cannot prevail over against the current labor dispute
expressed provision of the labor laws allowing dismissal of or because of any
employees for cause and without any provision for separation unfair labor practice if
pay. Manning International Corp v. NLRC, 195 SCRA 155 he has not obtained
(1991) any other
substantially
Balancing Conflicting Claims equivalent and
regular employment.
UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
Proof needed: Substantial evidence Domasig v. NLRC, 261
EER SCRA 779 (1996)

4-fold test: HWFC Independent Contractor and Labor Contractor Only

1. Selection of Employee (Hiring)
2. Payment of Wages Independent Contractors Labor-Only Contractors
3. Power to Dismiss (Firing) 1. has sufficient 1. no substantial
4. Control on employee on means and methods (Control) substantial capital/investment
capital/investment in in the form of
Control Test: machinery, tools or machinery, tools or
[1] This is to be distinguished from the control used in equipment directly or equipment
Independent Contractor or IC. In IC, control is used not to intended to be 2. no independent
test ER-EE relationship, but WON there’s control (as to related to the job business
the means only) as would warrant a relationship with an contracted 3. performs activities
IC. 2. carries an directly related to
[2] One need not actually exercise control, provided the ER independent the main business
reserves the right to control. It also need not be done business different of the principal
personally or physically because it may be done through from the employer’s 4. under control and
an intermediary (supervisor or manager, etc.) 3. undertakes to supervision of the
perform the job ER
Insular Life v. NLRC 1989 Doctrine under its own
EER… account and
Exists: rules that control/fix methodology + bind/restrict the responsibility
party hired to use of such means (result + means) 4. not under control
Does not exist: rules that merely serve as guidelines towards and supervision of
the achievement of the mutually desired result without the employer
dictating the means or methods to be employed in attaining it No EER except when the Principal treated as direct
(result only) contractor or the employer of the person
subcontractor fails to recruited in all instances
Economic Test pay the wages of the (Art106(4))
Sevilla v. CA Doctrine (1988) EEs (Art. 106(2))
-Existing economic conditions between the parties are used to LIMITED LIABILITY Liable FULLY as an ER
determine whether EER exist (principal solidarily liable
e.g. with contractor or
a. payment of PAG-IBIG Fund contributions subcontractor only when
b. payment/remittance of contributions to the State Insurance the latter fails to comply
Fund with the requirements as
c. deduction of withholding tax to unpaid wages and
d. deduction/remittance of SSS Contributions other labor standards
violations
Agreement Permissible Prohibited
-The employment status of a person is defined and prescribed *The company can determine in its best business judgment
by law and not by what the parties say it should be Insular whether it should contract out the performance of some of its
Life Assurance Co. v. NLRC 1998 work for as long as the employer is motivated by good faith,
and the contracting out must not have been resorted to
Method of Wage Payment circumvent the law/ must have been the result of
1. boundary system: The fact that the driver does not malicious/arbitrary action. MERALCO v. Quisumbing, 302
receive fixed wages but only the excess of the SCRA 173 (1999)
“boundary” given to the owner/operator is not
sufficient to change the relationship between them. *The court took judicial notice of the practice adopted in
Indubitably, the driver performs activities which are several institutions and industries of hiring janitorial services
usually necessary or desirable in the usual business on an independent contractor basis. In this respect, although
or trade of the owner/operator. The existence of an the janitorial services may be considered as directly related to
employment relation is not dependent on how the the principal business of an employer, as with every business,
worker is paid but on the presence or absence of we deemed them unnecessary in the conduct of employer’s
control over the means and method of the work. principal business Coca-Cola Bottlers Phils, Inc. v. NLRC, 307
Villamaria v. CA, 487 SCRA 571 (2006) SCRA 131 (1999)
2. Commissions: payment of compensation by way of
VII. EMPLOYEE CLASSIFICATION
commission does not militate against the conclusion A280:
EER exists. Under Art.97 of LC, “wage” shall mean -written/oral agreement not binding
“however designated, capable of being expressed in GR: Regular: employee has been engaged to perform
terms of money, whether fixed or ascertained on a activities which are usually necessary or desirable in the
time, task, price or commission basis. Insular Life usual business or trade of the employer (consider
Assurance Co v. NLRC 1998 nature of work + 1yr on the job)
Other regular EEs:
Hours of Work 1. Casual employee after 1 year of service whether
-it doesn’t follow that a person who doesn’t observe normal continuous or broken
hours of work cannot be defined as an employee. Lazaro vs. 2. Probationalry EE who is allowed to work even after
SSS, 435 SCRA 472 (2004) completion of probi period
 UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
3. Learner who is allowed or suffered work during first 2 Seasonal Employees
months of learner period, if training is terminated by GR: where the work to be performed or service to be
ER before end of stipulated period performed is seasonal in character, the employment is
4. Project employees where the employment period is deemed to last only for the duration of the season.
extended long after the supposed project has been X: seasonal employees who are constantly rehired after
finished every season are considered merely on LOA with pay. Their
5. Project employees performing activities which are employment relationship is never severed but only
suspended. Manila Hotel v. CIR, 9 SCRA 184 (2003)
usually necessary or desirable in the usual business
or trade of the ER + continuously for more than the
Residency Training
duration of the period Imbuido v. NLRC, 329 SCRA
-resident trainees are never permanent: it is a step taken by
357 (2000)
physician right after post graduate internship prior to
6. Workpool employees CONTINUOUSLY (not recognition as a specialist or sub-specialist in a given field.
intermittently) re-hired by SAME EMPLOYER, SAME Xxx they enjoy right to security of tenure ONLY to extent that
TASK/NATURE OF TASK and Task vital, necessary and they periodically make the grade, making the situation quite
indispensable for the usual business of the employer unique. Felix v. Buenaseda, 240 SCRA 139 (1995)
Maraguinot v. NLRC (1998)
7. Seasonal employees who are continuously rehired VIII. Probationary Employee
A281
Manila Hotel v. CIR
X: 1. shall not exceed 6 months from date the employee
-employment has been fixed for a specific project or started working (unless apprenticeship for a longer
undertaking the completion or termination of which has period). 6 month period = 180 days Mitsubishi v.
been determined at the time of the engagement of the Chrysler Labor Union, 433 SCRA 206 (2004)
employee (Project employee) 2. services may be terminated
-service to be performed is seasonal in nature and the a. for just cause
employment is for the duration of the season (seasonal
employees)
b. when EE fails to qualify as a regular EE in accordance
with reasonable standards made known by ER to EE at
the time of his engagement
Special Rules
*termination may be done even before the end of the
Project employees
probationary period, International Catholic Migration
*A280: (1) For a specific project or undertaking; (2)
Commission v. NLRC, 169 SCRA 508 (1989)
completion/termination determined at time of engagement
*immaterial if the employment lasts longer than 1 year: 3. ER has obligation to inform the EE of the reasonable
length of service is not controlling for project employees. Even standards to qualify as regular EE Mitsubishi v.
if service renewed, if every time renewed, they had a contract Chrysler Labor Union, supra.
for a specific term or duration Palomares v. NLRC, 277 SCRA 4. if allowed to work after the probationary period, shall
439 (1997)
be considered a regular EE Holiday Inn Manila v.
*if dismissal unjustified + before expiration of the term, the
NLRC, 226 SCRA 417 (1993)
project EE should be paid his salary for the unexpired portion
of his contract. AM Oreta & Co v. NLRC, 176 SCRA 218 (1989)
Exceptions to the 6-month rule:
*the project and principal business must be separate and
*Buiser v. Leogardo (salesrep case), 131 SCRA 151 (1984): 6-
distinct from each other ALU-TUCP v. NLRC, 234 SCRA 678
month rule may be extended provided:
(1994)
1. parties agree so
2. longer period necessary to learn the nature of the
Casual Empolyees
work to be performed
TEST: not the employment contract, but the nature of the job
(if usually necessary or desirable to the main business of the
* probi EE may become a regular EE even before the 6
ER, EE regular employee AM Oreta & Co v. NLRC, 176 SCRA
months had lapsed. International Catholic Migration
218 (1989)
Commission v. NLRC, supra
*If more than 1 year in service: status of regular employment
* Mariwasa v. Leogardo, 169 SCRA 465 (1989): 6-month
attaches to the casual worker on the day immediately after
period may be extended, provided:
the end of his 1st year of service Kimberly v. Drilon, 185 SCRA
1. absence of any indication that the extension is a mere
190 (1990)
stategem of the ER to avoid the legal consequences of a probi
*On janitorial and messengerial services: may be considered
period satisfactorily completed
directly related to the business, BUT they are deemed
2. written consent of the EE
necessary San Miguel Corp v. Abella, 461 SCRA 392 (2005)
3. EE wanted the extension to improve his performance and to
qualify for regular employment
Fixed term employment
Brent v. Zamora Doctrine
*Absorbed employees (merger of companies, EEs of the
1. Fixed term employment is valid. Nothing in the law
absorbed company absorbed into the newer company)
prohibits fixed term employment, provided, that it
-cannot be considered probi: they were already well-trained in
does not intend to circumvent the law on tenurial
their respective functions Cebu Stevedoring v. Regional
security
Director, 168 SCRA 315 (1988)
2. 2 requisites for validity:
-no double probation: if probi before then became a regular
(a) entered knowingly and voluntarily by the parties
EE, then absorbed to another company, cannot be subjected
without any force, duress or improper pressure
to another probi employment. A Prime Security Services v.
(b) ER and EE dealt with each other on more or less
NLRC, 322 SCRA 283 (2000)
equal terms, no moral dominance over the other
*Seafarers: contractual employees, whose employment is
*Private School Teachers
governed by the POEA standard employment contract Millares
v. NLRC, 385 SCRA 307 (2002)
UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
-rehired successively for continuous years + teach full time +
service satisfactory = regular teachers (manual of regulation
for Private Schools)
*IRR:
1. engaged in LEARNABLE/APPRENTICEABLE work: probi
period limited to authorized learnership/apprenticeship period
2. NEITHER LEARNABLE/APPRENTICEABLE: shall not exceed 6
months from date employee actually started working
3. TERMINATION: only for just/authorized cause or if fails to
qualify as a regular employee (same as A281)
4. REASONABLE STANDARDS: should be made known AT THE
TIME OF ENGAGEMENT, or else deemed regular
LABOR STANDARS
Purpose of the provisions
-to alleviate the plight of workers whose wages barely meet
the spiraling costs of basic needs Mariveles Shipyard Corp. v.
CA, 415 SCRA 573 (2003)
Recruitment and Placement of Workers
Art13(b): Recruitment and Placement: any act of
1. Canvassing
2. Enlisting
3. Contracting
4. Transporting
5. Utilizing
6. hiring
7. or procuring workers
and includes
a. referrals
b. contract services
c. promising or advertising for employment
…locally or abroad
…whether for profit or not
Proviso: 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
Who are allowed to recruit
GR: Public Employment Offices (Art16)
X: Private employment sector allowed under guidelines, rules
and regulations as may be issued by the secretary of labor
Guidelines for allowing:
1. citizenship requirement: only Filipino
citizens/corporations, partnerships/entities at least
75% of the authorized and voting capital stock of
which is owned and controlled by Filipino citizens
(A27)
2. substantial capitalization (A28)
3. application for license, paying registration fees (A30)
and bonds (A31)
Prohibited recruitment
1. (A18) direct-hiring for overseas employment, except
-diplomatic corps
-international orgs
-Other employers allowed by secretary of labor
2. (A26) travel agencies
License requirements
Art.13d License: document issued by the DOLE authorizing a
person or entity to operate a private employment agency
(charges fee – Art13c)
Art 13f Authority: document issued by the DOLE authorizing a
person or association to engage in recruitment and placement
activities as a private recruitment entity (without charging
fee – Art13e)
So ulit (in order in Art13): ELRA
private Employment agency: with fee: License
private Recruitment entity: without fee: Authority
*license territorial: could only undertake recruitment and
placement activities in the region where the license was
granted People v. Buli-E, 404 SCRA 105 (2003)
Illegal Recruitment
*To determine whether LC or the Migrant Workers Act of 1995
(RA 8042) applies, determine the place of work:
If in RP: LC applies
If Abroad: MWA applies
Acts: Art13b, Art34
Elements: (under LC)
1. no valid license/authority (A38)
2. does acts under Art13b or Art34
(Under MWA)
1. no valid license/authority + performs acts under
Art13b, LC
2. has valid license/authority + performs acts under
Art6, MWA
Large scale or by syndicate: considered an offense
involving economic sabotage
Large scale illegal recruitment: committed against 3+ persons
individually or as a group
Illegal recruitment by syndicate: carried out by a group of 3+
persons conspiring and/or confederating with one another in
carrying out any unlawful or illegal transaction, enterprise or
scheme
Guidelines on enforcement of rights
Determine:
* The Place of work to know which law to apply (LC or MWL)
* The Acts involved (C-E-C-T-U-H-P or R-C, etc.)
* The nature of the offense (Simple, in Large Scale or by a
Syndicate)
- Illegal Recruitment by a Syndicate – when carried out by
a group of 3 or more persons conspiring to carry out
any unlawful transaction (# of violators involved)
- Illegal Recruitment in Large Scale – when committed
against 3 or more persons individually or as a group (#
of workers involved)
Notes: [a] In MWA, money claims are within the jurisdiction of
the Labor Arbiter, NLRC. [b] The Sec. of Labor has regulatory
and visitorial functions (A36 & 37 of LC). But he can no longer
order the arrest of violators. HE cannot issue search or arrest
warrants, as this must go through the judicial process, since
A38par.(c) of LC already deemed unconstitutional. [c] 3
separate informations of illegal recruitment cannot be
consolidated in order to charge the offense from simply to
large scale or by a syndicate.
Alien Employment
Requisites
1. Employment permit (Art40)
-nonresident aliens need employment permit from DOLE
-resident aliens: No need Almodiel v. NLRC, 223 SCRA 341
(1993)
2. SOLE determine:
a. non-availability 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 (Art40)
b. other factors like economic and national interest
considerations
3. only SOLE authorized to issue Employment Permit Gen
Milling Corp v. Torres, 196 SCRA 215 (1991)
4. no transfer of employment from one ER to another because
EP was granted only for that particular job (Art41)
UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
5. there must be an understudy program to assure technology VI. Conditions of Employment
transfer (IRR)
A. Hours of Work
Special Class of Workers (TESDA Act of 1994, RA 7796) Coverage
A. Apprentice A82
Defined (Sec4) Covered: EEs in all establishments and undertakings, whether
1. w/n employment for profit or not. (Sir: All EEs in private sector)
2. w/ compulsory related theoretical instructions/ NOT Covered:
Governmentt EEs,
apprenticeship program (approved by DOLE before
Managerial EEs,
apprenticeship agreement entered into. Nitto
Field Personnel,
Enterprises v. NLRC, 248 SCRA 654 (1995)
Members of ER’s family dependent upon for support,
3. involves a contract between an apprentice and an ER
Domestic helpers,
4. highly skilled trade or skill
Persons in personal Service of another,
5.
Piece worker
Apprenticeable Occupation: officially endorsed by a
tripartite and approved by Authority
Note: If Piece worker earns less than minimum wage, then
he’s paid the minimum wage
Qualifications
*Managerial EE – primary duty consists of mgt of
Sec12 employment of children below 15yo
establishment, includes members of managerial staff
1. when child works directly under sole responsibility of
*Field Personnel – non-agricultural EE who regularly perform
parents/legal guardian
duties away from principal place of business and whose
-only members of employer’s family employed
actual hours of work in the field cannot be determined with
-provided:
reasonable certainty.
a. no danger
TEST to determine if Field Personnel:
b. provide with education
2. public and entertainment/info (cinema, theater, radio, tv) 1. not under the effective control and supervision of the
-DOLE permit ER Merdicar Fishing Corp. v. NLRC, 297 SCRA 440
-concluded by parents (98)
-express agreement by child 2. number of hours spent working cannot be reasonably
-prevent child exploitation, discrimination
ascertained Union of Filipro Employees v. Vivar, 205
-continuing program for training and skills acquisition
SCRA 200 (1992)
Terms and Conditions
Normal Hours of Work (A83): 8 hours max
A61
Health personnel
1. max. 6 months
GR: 8 hrs, 5 days/wk (40 hrs)
2. min 75% below min. wage
X: 8hrs, 6 days/wk (48 hrs) – entitled to min 30% of regular
3. apprenticeship program approved by DOLE
wage on 6th day
A72 (OJT): without compensation
Compressed Work Week: Requisites
Costs: A71
(a) the employee voluntarily agrees to it
-ER may deduct ½ costs of training expenses from taxable
(b) there is no diminution in their weekly or monthly take
income provided:
home pay or fringe benefits
a. apprenticeship program recognized by DOLE
(c) The benefits are more than or at least commensurate or
b. deduction shall not exceed 10% of direct labor wage
equal to what is due the employees without the compressed
c. pay apprentice min. wage (not 75% of the min wage)
work week.
(d) overtime pay will be due and demandable when they are
B. Learners
required to work on those days which should have ceased to
1. trainees in
be working days because of the compressed work week
a. semi-skilled
schedule.
b. other industrial occupation (non-apprenticeable)
(e) no strenuous physical exertion or that they are given
2. Learnership program APPROVED by authority
adequate rest periods
3. can only be hired when (A76(b)):
(f) it must be for a temporary duration as determined by the
a. no experienced worker available
department of labor
b. employment necessary to prevent curtailment of
employment opportunities
Hours worked (to be compensable)
c. employment doesn’t create UNFAIR COMPETITION in
(A84): includes
terms of labor costs/impair/lower working standards
a. EE required to be on duty
4. the contract should include (A75):
b. EE suffered or permitted to work
a. names and addresses
b. duration (maximum of 3 months) c. Rest periods* of short duration during working hours.
c. wages: minimum 75% of applicable min. wage d. Travel time, when beneficial to ER Rada v. NLRC, 205
d. commitment of ER to hire learners as regulars
SCRA 69 (1992)
5. would be deemed as regulars if: worked first 2 months,
i. travel from home to work: if on call and required to
terminated before end of stipulated period, no fault on learner
travel
ii. all in the day’s work: traveling is the principal
C. Handicapped Workers
activity, regardless of contract, custom, practice
- If qualified, handicapped workers may be considered
iii. travel away from home: cut’s across EE’s workday
apprentices or for apprenticeship
*Not counted when: (Luzon Stevedoring v. Luzon Marine
-should be given the same terms and conditions of a qualified
Department Union, 101 Phil. 257 (1957))
able-bodied person. Should be paid full compensation, like a
i. EE ceases to work;
regular EE, Bernardo v, NLRC, 310 SCRA 186 (1999)
ii. EE may rest completely;
UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
iii. EE may leave at his will the spot where he actually -ER shall determine, subject to: (a) CBA; (b) rules and
stays while working to go somewhere else. regulations provided by SOLE; (c) preferences of EE, based on
iv. when work is broken/not continuous NDC v. CIR, 6 religious grounds
SCRA 763 (1962) *92: Even if rest day, ER may require EE to work:
v. Assembly time, routinary practice of EEs, proccedings a) In case of ACTUAL OR IMPENDING EMERGENCIES
not infected with complexities so as to deprive EEs time
caused by serious accident, fire, flood, typhoon,
to attend to their personal pursuits Arica v. NLRC, 170
earthquake, epidemic or other disaster or calamity to
SCRA 776 (1989)
prevent loss of life and property, or imminent danger
vi. Meal time (60 mins – A85), unless predominantly spent
to public safety;
for ER’s benefit
b) in cases of URGENT work to be performed on the
machinery, equipment, or installation, to avoid
Overtime pay
serious loss which the ER would otherwise suffer;
*A87:
c) in the event of ABNORMAL PRESSURE OF WORK due
- if beyond 8hrs, regular working day: regular wage + 25% of
to special circumstances, where the ER cannot
regular wage = overtime pay
ordinarily be expected to resort to other measures;
- if on holiday/rest day: rate of 1st 8 hours on a holiday/rest
d) to prevent loss or damage to PERISHABLE goods
day + 30% of holiday pay/rest day pay
e) Where the nature of the work requires CONTINUOUS
*if contract requires for more than 8hrs of work/day, void if
OPERATIONS and the stoppage of work may result in
not provide:
irreparable injury or loss to the ER;
a. fixed hourly rate or
f) Under other circumstances analogous or similar to
b. daily wages include OT Manila Terinal Co v. CIR, 91 Phil
the forgoing as DETERMINED by the SOLE
625 (1952)
*93: Compensation for Rest Day, Sunday or Holiday
c. if built-in OT, could provide higher pay, WON excess time
Work
worked or unworked Engineering Equipment Inc. v. MOLE
a. scheduled rest day = Sunday: paid additional 30% of
*cannot offset OT by undertime (A88)
regular wage
*ER can be compelled to perform OT work under A89, with OT
b. nature of work: no regular rest day + Sundays/holidays:
Pay:
paid additional 30% of regular wage
a) When there’s WAR, national or local emergency
c. special holiday: paid additional 30% of regular wage
declared by Congress or Chief Exec/Pres;
if special holiday + scheduled rest day: 50% of regular
b) When necessary to prevent LOSS of life or property
wage
or in case of imminent danger to public safety;
d. CBA stipulates higher rate: ER pay higher rate
c) When there’s URGENT work to be performed on
machines, installations etc, to avoid serious loss or
HOLIDAY PAY
damage to ER;
*A94: during holidays
d) When work necessary to prevent loss or damage to
a. EE paid regular daily wage (no work) except: in retail and
PERISHABLE goods;
service establishments + less than 10 workers employed
e) When completion or continuance of work started
b. ER may require EE to work during holiday BUT pay 2x
before the 8th hour is necessary to prevent SERIOUS
regular rate
obstruction or prejudice to ER business
c. HOLIDAYS:
Regular Holidays in EO 203
Night Shift Differential
i. New Year’s Day
*A86: if work between 10pm-6am, entitled to night shift
ii. Maundy Thursday
differentials
iii. Good Friday
Night shift differential pay= 10% of regular wage for each
iv. April 9 (Araw ng Kagitingan)
hour of work performed
v. May 1 (Labor day)
*question: what about Call-center agents?
vi. June 12 (Independence Day)
vii. July 4 (Fil-Am Friendship Day)
*from DOLE
viii. Nov. 30 (Bonifacio Day)
Where Night Shift (10 PM to 6 AM) Work is Regular Work
ix. Dec 25 (Xmas)
1. On an ordinary day — Plus 10% of the basic hourly rate
x. Dec 30 (Rizal Day)
or a total of 110% of the basic hourly rate.
xi. General election day
2. On a rest day, special day or regular holiday — Plus
xii. Eidul Fitr - Movable date RA 9177
10% of the regular hourly rate on a rest day, special day or
*xiii. Eidul Adha – regular holiday observed in ARMM
regular holiday or a total 110% of the regular hourly rate.
Special nonworking day: EO 203, RA 9492
Where Night Shift (10 PM to 6 AM) Work is Overtime Work
i. Monday nearest August 21 (Ninoy Aquino Day)
1. On an ordinary day — Plus 10% of the Overtime hourly
ii. Nov. 1 (All Saints Day)
rate on an ordinary day or a total of 110% of the overtime
iii. Dec. 31 (Last Day of the Year)
hourly rate on an ordinary day.
*if 2 regular holidays fall in a single day (Asian Transmission
2. On a rest day/special day/ a regular holiday — Plus 10%
Corp vs. CA, 425 SCRA 478 (2004)):
of the overtime hourly rate on a rest day/Special day/regular
-if unworked: EE receives 200% of regular wage (100% for
holiday
each regular holiday)
3. For Overtime work in the night shift:
-if worked: EE receives 400% of regular wage (2x 100% for
1. On an ordinary day — Plus 10% of 125% of basic hourly
each regular holiday)
rate or a total of 110% of 125% of basic hourly rate.
*FOR PRIVATE SCHOOL TEACHERS (paid per lecture hour): not
2. On a rest day/special day/ regular holiday — Plus 10%
entitled to unworked holiday pay for regular holidays, but
of 130% of the regular hourly rate on said days or a total of
entitled to holiday pay for special public holiday, and when
110% of 130% of the applicable regular hourly rate.
classes are called off or shortened on account of typhoons,
floods, rallies, and the like Jose Rizal College v. NLRC, 156
B. Weekly Rest Periods
SCRA 27 (1987) – except regular holidays during Christmas
*A91: ER should provide EE 24 consecutive hours rest period
vacation (LC IRR)
after every 6 consecutive normal workdays (so may day-off)
UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
*If holiday falls on a Sunday: ER only obliged to give holiday - Only government EEs entitled to vacation and sick leaves.
pay Wellington Investment Inc. v. Trajano, 245 SCRA 561 - No vacation or sick leaves to EEs in the private sector. It
(95) should be negotiated by the EEs to the ER.
*other special rules in IRR - The payment of vacation and sick leaves is governed by ER’s
policy or agreement between ER and EE
C. Leaves
*A 95: Right to Service Incentive Leave (SIL) Solo Parent Leave
a. EE should have rendered 1 year service. 5 day SIL with pay (RA 8972)
b. not applicable to: 1. rendered at least 1 year of service
i. those already benefit provided herein 2. notified ER w/n reasonable period
ii. those already enjoying 5-day leave with pay 3. presented solo parent ID
iii. those employed in establishments regularly employing other benefits:
less than 10 EEs/ -educational benefits
iv. those employed in establishments exempted from -flexi-work schedule
granting SIL by SOLE (considering viability or financial -housing benefits
condition of such establishment)
v. gov’t employee, GOCC employees - Only government EEs entitled to vacation and sick leaves.
vi. domestic helpers, persons in the personal service of - No vacation or sick leaves to EEs in the private sector. It
another should be negotiated by the EEs to the ER.
vii. managerial employees - The payment of vacation and sick leaves is governed by ER’s
viii. field personnel and other policy or agreement between ER and EE
employees whose performance is unsupervised by the
IX. Wages
employer including:
Coverage: A97 (who are included); A98: not included:
(a) those who are engaged on
a. farm tenancy or leasehold
task or contract basis
b. domestic service
(b) those engaged on purely
c. persons working in their respective homes in needle
commission basis
work or in any cottage industry duly registered in
(c) those who are paid a fixed
accordance with law
amount for performing work irrespective of the
Definition: A97(f)
time consumed in the performance thereof
- remuneration or earnings
c. grant of benefit in excess of SIL shall not be made a subj of
- capable of being expressed in terms of money
arbitration
- whether fixed on a time, task, piece, commission
basis or other method of calculating the same,
Paternity Leave
- paid to EE,
(Paternity Leave Act of 1996, RA 8187)
- under written or unwritten contract of employment,
-every married male employee, public/private sectors
- for work done, to be done or services rendered or to
-7 days, full pay for first 4 deliveries (childbirth, miscarriage)
be rendered
-of LEGITIMATE spouse with whom he is cohabiting
-notify employer of pregnancy, expected date of delivery - includes fair and reasonable value (determined by
Ratio: lend support to his wife during period of recovery Sec. of Labor) of board, lodging and other facilities
and/or nursing of newborn baby customarily furnished by ER to EE
“fair and reasonable value” – shall not include any profit to ER
Maternity Leave or to any person affiliated with ER
(Sec.14-A, RA 8282) “fair day’s pay for a fair day’s work”
-female employee
-regardless if married or unmarried Facilities v Supplements
-paid at least 3 monthly contributions in the 12-mnth period *Facilities – items of expense necessary for the EE’s and his
immediately preceding the semester of her family’s existence and subsistence and form part of the
childbirth/miscarriage wage. If furnished by ER, deductible from wage. (e.g
-paid daily maternity beneit = 100% of average salary credit board, lodging etc.)
for *Supplements – constitute extra remuneration or special
60 days: normal delivery benefits given to or received by EEs over and above their
78 days: caesarian delivery ordinary earnings or wages.

Conditions: Wage v Salary

*notified employer of pregnancy and probable date of
childbirth – transmitted to SSS
*full payment advanced by ER w/n 30 days from filing of
maternity leave application
*payment of daily maternity benefits = bar to recovery of
sickness benefits during same period
*Maternity benefits = 1st 4 deliveries
*SSS immediately reimburse ER upon receipt of satisfactory
proof of such payment, if:
-w/o required contributions having been remitted for her by
her ER to the SSS
-w/o SSS having previously notified by ER of TIME of
pregnancy
…ER pay damages to SSS equivalent to benefits w/c EE
member would otherwise have been entitled to
Gaa v CA case
- Wage and salary are in essence synonymous because they
refer to the same meaning: reward or pay for services
rendered.
- Distinction: Wage applies to compensation for manual labor,
and to skilled or unskilled work, while salary denotes a higher
degree of employment and applies to high-skilled or highly
technical type of job. (Note: This distinction is only artificial. It
is only for attachment or garnishment purposes. Wage is too
small to be attached or garnished)
Gratuity v Wages
Gratuity pay is not intended to pay EE for job done but to
reward EE for satisfactory or efficient service. It is gratuitous,
and as such, is a gift.

Sick Leave and Vacation Leave: Voluntary Benefits Payment of Wages

UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
Form (A102): Not in: 3. deduction to ensure employment (A117)
-promissory notes 4. Retaliatory measures (A118): when EE
-vouchers -filed complaint/instituted proceedings against ER under this
-coupons Title (Wages)
-tokens -has testified/about to testify in such proceedings
-tickets
-chits Other forms of Remuneration
-any other than legal tender, even when expressly requested A. Service Charges (196)
by the EE Coverage: establishments collecting service charges
*payment by check or money order: Allowed when: -hotels
1. manner of payment customary on the date of effectivity of -restaurants
LC -lodging houses
2. manner of payment necessary because of special -night clubs
circumstances (specified in SOLE regulations/CBA) -cocktail lounge
-massage clinics
Time of Payment (A103) -bars
-at least once every 2 weeks or 2x a month (at max 16 day -casinos
intervals) -gambling houses
-if cannot pay because of force majeure, ER pay wages -similar enterprise (including Gov’t entitles)
immediately after such force majeure or circumstances have Distribution:
ceased 15% management – lossess and breakages + distribution to
-least frequency: once a month managerial employees
-if task to be performed cannot be completed in 2 weeks + NO 85% equally among ALL employees
CBA/Arbitration award: Frequency of distribution: 2x a month
a. payments made at intervals not exceeding 16 days, in Service Charge vs. Tips: Notes:
proportion to the amount of work completed 1) Service charges are charges for the use of facilities, so
b. final settlement is made upon completion of work there’s a sharing agreement while tips are for EEs only, thus
no sharing with ER;
Place of Payment (A104) 2) The moment ER abolishes service charges, ER must
GR: at or near the place of undertaking integrate in wages the average share of EE in the service
X: charges. This occurs by automatic operation of law.
-SOLE regulations
-RA 6727: can pay thru banks if (a) with majority approval; (b) B. 13th Month Pay (PD 851)
banks within 1km radius from place of undertaking Coverage: All EEs provided they have worked for at least 1
month dring a calendar year.
Direct Payment (A105) X: EEs:
GR: pay to workers directly - Government EEs
X: - Household helpers
1. force majeure: through another person + - Terminated EEs, but may be paid in proportion to the
written authority given by ER for the purpose length of time worked during the year.
2. EE died: pay wages to heirs ERs:
- Government and its political subdivision, and GOCCs
3. ER authorized in writing by EE to pay wages
except those operating as private subsidiaries of the
to a family member
government
4. payment to another person authorized by
- ERs already paying their EEs a 13th month pay or its
law + in writing
equivalent
- ERs of household helpers and persons in personal
Non-interference (A112)
service of another
-ER cannot interfere with freedom of EE to dispose wages
- ERs of those who are paid on purely commission,
-EE cannot be compelled to purchase from ER
task basis, except where EEs are paid on piece work
basis.
Wage Deduction (A113)
GR: ER cannot make deductions from EE’s wages
C. Bonus
X:
-The grant of a bonus is a management function and not an
-insurance premium
obligation. It is not a demandable and enforceable obligation.
-union check-off
It is entirely dependednt on the Financial Capability of
-when ER authorized by law or SOLE regulations
Employer to give it.
-with written authorization from EE’s, ER not pecuniary benefit
-When demandable: when it is made part of the wage or
salary or compensation of the EE.
Unlawful deductions/ Withholding/ Deposits
*Performance bonus – there’s a criteria; only for those who
1. Deposits for Loss or Damage (A114)
meet criteria
GR: no deposit for reimbursement of loss of or damage to
*Across-the-Board bonus – all EEs, but sometimes not all
tools, materials, or equipment supplied by the employer
actually
X:
-ER engaged in trades, occupation or businesses with
Wage Recovery
recognized practice of making deductions or requiring
*For independent contractor-ER-EE: independent contractor
deposits
and ER solidarily liable for payment of wages (A106)
-deductions/deposits necessary or desirable as determined by
*if ER in Receivership, should institute claims in receivership
SOLE
proceedings
*if deposit for actual amount paid by EE, EE should have been
heard + his responsibility clearly shown (A115)
Minimum Wages
2. Witholding Wages and Kickbacks (A116): unless with
-consti provides that EE be provided a living wage
the EE’s consent
UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
-same margin or leeway must be provided, over and above
the minimum, to take care of contingencies Atok Big Wedge
Mining Co., Inc v. Atok Big Wedge Mutual Benefit Association,
92 Phil 755 (1953)
Focus of the law: Determining the agencies established for
wage fixing machinery, namely:
1 – National Wages and Productivity Commission (NWPC)
2 – Regional Tripartite Wages and Productivity Board (RTWPB)
Tripartite consists of the following: ER, EE and Government
• NWPC (Commission)
[a] Prescribe or set rules and guidelines for the
determination of appropriate minimum wages and the
factors to be considered
[b] Power to review wage levels set by RTWPB; appeal power
• RTWPB (Board)
[a] Determines and fixed minimum wage rates applicable to
region, provinces, industries
[b] Promulgates the wage order
IMPORTANT: The dividing line between NWPC and RTWPB is
that the Commission sets the guidelines to be followed,
while the Board promulgates the wage orders.
Process for Minimum Wage Fixing:
1 – There must be a need determined by the board based on
its study of pertinent facts, considering A124(par1)
2 – Conduct public hearings and consultations
3 – Issue wage order (W.O.)
4 – Publication of wage order in a newspaper of general
circulation. W.O. takes effect 15 days thereafter
5 – Appeal to NWPC w/in 10 calendar days; NWPC required to
resolve issue w/in 60 days from filing
*Effect of Appeal: Appeal will NOT STAY execution of W.O., but
if ER posts a surety bond, then execution of WO will stay.
Wage Distortion
-possible effect of wage increase
-increase in prescribed wage rates resulting in an elimination
or severe contraction of intentional quantitative differences in
wage or salary rates between and among employee groups in
an establishment as to effectively obliterate the distinctions
embodied in such wage structure based on Skills, Length of
Service, or other Logical Bases of differentiation (SLSLB)
4 elements Prubankers Assn v. Prudential Bank & Co., 302
SCRA 74 (1999)
1. existing hierarchy of positions with corresponding salary
rates
2. significant change in salary rate of a lower pay class w/o
concomitant increase in salary rate of higher one
3. elimination of distinction
4. existence of distortion
How is W.D. resolved?
• You have to distinguish between:
1) Organized establishment – meaning, there’s a CBA, or
a union is recognized as the exclusive bargaining
representative
2) Unorganized establishment – no CBA, no recognized
exclusive bargaining representative even if there’s
union
• Different procedures for settlement of each
Organized Establishment:
1 – Grievance procedure agreed in CBA
2 – Voluntary arbitration (usually a neutral third party
resolves it)
Unorganized Establishment:
1 – ER and EE with aid of National Conciliation Mediation
Board (NCMB) through conciliation mediation
2 – Compulsory arbitration by NLRC
*ER can unilaterally resolve W.D. but ER has no obligation to
restore the same differential which existed prior to the W.D.
as long as ER restores a differential
Notes: 1) W.D. will always be a factual issue. The existence of
a W.D. will not stop execution of W.O.; 2) W.D. is localized.
It will only apply in a given industry or region and not
nationwide; 3) A minimum wage order cannot be less than
that prior to the W.O. (A100 LC re rule against diminution or
elimination of income or benefits).
X. Women Workers
Prohibited Acts
Under LC
1. Night Work
GR: No night work (A130)
a. industrial: 10pm to 6am the following day
b. commercial/non-industrial (other than agricultural): 12mn
to 6am the following day
c. agricultural: nighttime (unless given a period of rest of
min.9 consecutive hours)
X: A131
a. Actual or impending emergencies
b. Urgent work
c. Serious loss of Perishable goods
d. Has position of managerial of technical nature, or
engaged to provide health and welfare services
e. Manual skill and dexterity of woman workers
required
f. Immediate members of the family operating the
establishment or undertaking
g. Analogous cases
2. Discrimination: in terms and conditions of employment
(A135)
a. pay less compensation for work of equal value
b. with respect to promotion, training opportunities, study
and scholarship grants
3. Marriage: as condition of employment (pre-employment)
or continuation of employment (employment proper)
4. Pregnancy: discharge because of pregnancy (on leave or
not, upon returning to work on fear that she may be pregnant
again)
5. Deny benefits under LC/ discharge woman EE to deny her
of LC benefits
*Facilities: ensure safety and health, seats, separate toilet
rooms, lavatories, dressing room, nursery, determine min. age
*Certain Women Workers (A138)
-with or without compensation
-in night club, cocktail lounge, massage clinic, bar or similar
establishments
-under effective control or supervision of the ER for a
substantial period of time as determined by SOLE
-considered as EE
*Entitled to Maternity leave, husband to paternity leave
Sexual Harassment (RA 7877)
Requisites:
1. authority/influence/moral ascendancy
2. in work/training/educational environment
Work related environment:
-condition for employment
-impair rights, privileges
-IHO (intimidating, hostile, offensive) environment
Education/training-related environment:
-under care/supervision
-entrusted to offender
-condition for school…
-IHO environment
3. demands sexual favor
UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.

4. regardless if accepted or not *Probationary employees: enjoys security of tenure (Skillworld

Management and Marketing Corporation v. NLRC 186 SCRA
-ER has duty to prevent it, provide procedures for settlement
465 (1990):
-ER liable if failed to act/no immediate action done even if
-during the probationary period
informed of the act
-before the contract expires
XI. Minors
A. Termination of Employment by the EE
(RA 7610)
Causes:
*children: below 18/ above 18 but can’t fully take care of
a. just cause (285b):
themselves
-without serving notice:
*Child abuse:
1. serious insult by employer of honor and person of
-maltreatment
employee
-habitual/not
2. inhuman and unbearable treatment
*working children: if BELOW 15: Can’t be employed unless:
3. commission of a crime/offense
-works directly under sole responsibility of parents, only ER’s
4. analogous causes
family employed
b. w/o just cause (288a)
-works in publicentertainment/onfo
-serve written notice at least 1month in advance, or else ER
*Work permit should be first secured from DOLE
may hold EE liable for damages
*Nonformal education program should be provided
*Can’t employ child models for:
Resignation
-alcoholic beverages
-voluntary act of an employee who finds himself in a situation
-intoxicating drinks
where he believes that PERSONAL REASONS cannot be
-tobacco and by-products
sacrificed in favor of the exigency of the service + no other
-violence
choice but to disassociate himself from employment Habana
v. NLRC, 298 SCRA 537 (1998)
XII. Househelpers
-requisites:
*Coverage (A141):
1. unconditional
-service in ER’s home (if works in corporation’s resthouse and
2. with intent to relinquish a portion of term or of office
recreational facilites for use of top executives and clients of
3. act of relinquishment
the corporation, not domestic employees Apex Mining Co. Inc
*4. voluntary (for voluntary resignation)
vs. NLRC, 196 SCRA 251 (1991)
-usually necessary/desirable for MAINTENANCE/ENJOYMENT
*Floating Status: should last only for a legally prescribed
thereof
period of time. When that status of an EE exceeds 6m, he may
-includes MINISTERING TO THE PERSONAL COMFORT AND
be considered to have been illegally dismissed from the
CONVENIENCE of members of ER’s household
service. Valdez v. NLRC, 286 SCRA 87 (1998)
-includes services of family drivers
*Period of Contract: 2 years, renewable
When no termination of employment(A286):
*Minimum Wage (A143), minimum cash wage = basic cash
-bonafide suspension of business or undertaking for a period
wage + lodging, food and medical attendance (A144)
not exceeding 6 months
*non-household work (commercial/industrial/agricultural):
-fulfillment by the EE of a military or civic duty
should be paid higher salary rate than
agricultural/nonagricultural workers (A145)
B. Termination of Employment by ER
*Opportunity for education (A145):
Requirements:
-below 18 years
1. Based on the grounds in A282,283 or 284
-opportunity for at least elementary education
-cost of education: part of compensation, unless contrary 2. observance of due process requirements (A277b)
stipulation
*Treatment of Househelpers: I. Substantial Due Process Requirements: based on
-just and humane manner, no physical violence (A147) grounds in LC
-furnish with free suitable and sanitary living quarters +
adequate food + medical attendance (A148) A283 Just causes:
*domestic househelpers EXPRESSLY EXCLUDED from a. SERIOUS MISCONDUCT/WILLFUL DISOBEDIENCE of
coverage of OT, holiday pay, premium pay, SIL (A82) the lawful orders of ER in connection with work
b. GROSS AND HABITUAL NEGLECT
XIII. Homeworkers c. FRAUD/WILLFUL BREACH of trust reposed in EE
ER (155): d. COMMISSION OF A CRIME/OFFENSE by EE against
1. delivers/cause to be delivered any goods to be e. Analogous causes
processed/fabricated, returned to be
disposed/distributed a. SERIOUS MISCONDUCT
2. sell goods, articles, have same requisites (Premiere Dev’t Bank v. Mantal, 485 SCRA 234
processed/fabricated/rebuys (2006))
Industrial Homeworker: work for an ER/contractor is carried i. serious
out by a Homeworker at his/her home ii. must relate to the performance of EE’s duty
-materials may/may not be furnished iii. EE must be unfit to continue work

XIV. Termination of Employment WILLFUL DISOBEDIENCE

Coverage (A278): i. assailed conduct WILLFUL/INTENTIONAL, willfulness
-all establishment characterized by wrongful or perverse attitude
-for profit or not ii. order violated: reasonable, lawful, made known to
*for contract employees: security of tenure only to a limited employee, must pertain to duties which the EE has been
extent: during period of time their respective contract of engaged to discharge
employment remained in effect :Labajo v. Alejandro, 165
SCRA 747 (1988) b. GROSS AND HABITUAL NEGLIGENCE
UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
defined (Chua v. NLRC, 453 SCRA 244 (2005)
GROSS NEGLIGENCE: want of care in the performance of
one’s duties
HABITUAL NEGLIGENCE: repeated failure to perform one’s
duties for a period of time
c. FRAUD/WILLFUL BREACH OF TRUST (LOSS OF
CONFIDENCE)
i. employee concerned holds a position of trust and
confidence – entrusted with confidence in handling delicate
matters (managerial EE)
ii. act work-related: would show EE unfit to continue working
iii. there is some basis for such loss of confidence when ER
has REASONABLE GROUND TO BELIEVE that EE concerned is
responsible for purported misconduct and nature of
participation renders him unworthy of trust
iii.a loss of confidence should not be simulated
iii.b should not be used as Subterfuge for causes which are
improper/illegal/unjustified
iii.c should not be arbitrarily asserted in face of overwhelming
evidence to the contrary
iii.d must be genuine, not a mere afterthought to justify
earlier action taken in BF
*lack of material or pecuniary damages would not in any way
mitigate a person’s liability or obliterate the loss of trust and
confidence Cadiz v. CA, 474 SCRAS 232 (2005)
d. COMMISSION OF A CRIME
-against:
i. the person of his ER
ii. person of any immediate member of ER’s family
iii. person of duly authorized reps of ER
e. ANALOGOUS CASES
-susceptible of comparison with the causes enumerated either
in general or in some specific detail, or has a close
relationship with the latter Lim v. NLRC, 259 SCRA 485 (1996)
-examples:
*quarrelsome/bossy, sheer disrespect and defiance of
authority = serious misconduct/insubordination Cathedral
School of Technology v. NLRC, 214 SCRA 551 (1992)
*Abandonment:
Requisites (Leonardo v. NLRC, 333 SCRA 589 (2000))
i. failure to report for work/absence without valid
or justifiable reason
ii. clear intention, as manifested by some overt
acts, to sever EER
-not inferred or presumed Had. Dapdap v. NLRC, 285 SCRA 9
(1998)
*borrowing money = serious misconduct
-used trust relationship as a leverage for borrowing money
*Habitual Absenteeism = gross and habitual neglect
i. w/o leave
ii. violated company rules and regulations
iii. repeated for a period of time
*end of term in Term Employment
-upon expiration of period stipulated, appointment deemed
terminated, no need for notice requirements Brent School v.
Zamora, 181 SCRA 702 (1990)
*Past Infractions
Requisites (La Carlota Planters Assn v. NLRC, 298 SCRA 252
(1998))
i. the past infractions are related to the subsequent offense
ii. the past infractions has a bearing to the proximate offense
warranting dismissal
*End of Professional Training
-on Residency training: promotion to the next post-graduate
year is based on merit and performance determined by
periodic evaluations and exam of knowledge, skills and
bedside manner. If did not make the grade, can be
terminated. Felix v. Buenaseda (1995), supra
*Love and Morals
-immorality: the circumstances of each particular case
must be holistically considered and evaluated in light
of the prevailing norms of conduct and applicable laws.
For teachers, they must abide with standard of personal
conduct which not only proscribes the commission of immoral
acts, but also prohibits behavior creating suspicion of
immorality because of the harmful impression it may have on
the students. Santos v. NLRC, 287 SCRA 117 (1998)
-however, if teacher and student fell in love, and there is no
substantial evidence that the teacher took advantage of
position as a teacher to court the student, their relationship is
not a ground for dismissal. Yielding to this gentle and
universal emotion is not to be so casually equated with
immorality. Chua-Qua v. Clave, 189 SCRA 117 (1990)
*In the Manual of Regulations for Private Schools, Disgraceful
or immoral conduct is a ground for termination of a teacher
*Violation of company rules
-deemed analogous to SERIOUS MISCONDUCT
*Criminal Case
-guilt or innocence in a criminal case is not determinative of
existence of a just or authorized cause for dismissal. It follows
from the principle that the quantum and weight of evidence
necessary to sustain a conviction in a criminal case are quite
different from the quantum of evidence necessary for
affirmance of a decision of labor arbiter and NLRC
*Moonlighting
-subcontracting for another company clearly showing
intention to sever the EER with the EE. Agabon v. NLRC, 442
SCRA 573 (2004)
*Suspicion
-never been a valid ground for dismissal and EE’s fate cannot,
in justice, be hinged upon conjectures and surmises Eastern
Telecommunications Phils. Inc. v. Diane, 491 SCRA 239 (2006)
*Resignation and Effectivity
-when the EE has already voluntarily resigned, employment
deemed terminated
*Abolition of Position
Requisites (Benguet Electric Cooperative v. Verzosa, 425
SCRA 41 (2004))
i. position no longer necessary
ii. no findings of malice and arbitrariness on part of
management/ER
Transfers – Discharge and Suspension
-security of tenure not a vested right in a position as would
deprive the company of its prerogative to change the EE’s
assignment/transfer them where they will be useful
-not unreasonable, inconvenient, nor prejudicial to an
employee
-no demotion in rank, diminution of pay, benefits, privileges
and management prerogative to transfer/assign employees
Constructive Discharge
Defined (Philippine-Japan Active Carbon Corp. v. NLRC, 171
SCRA 164 (1989)
- involuntary resignation resorted to when
a. continued employment is renderd
…impossible
…unreasonable
UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
…unlikely legal warrant for reduction of personnel San Miguel Jeepney
b. offer involving demotion in rank Service v. NLRC, 265 SCRA 35 (1996)
c. diminution in pay ii. substantial loss must be reasonably imminent –
certain degree of urgency
Preventive Suspension iii. retrenchment reasonably necessary and likely to
-continued employment poses SERIOUS & IMMINENT THREAT effectively prevent expected losses
to LIFE & PROPERTY of the ER or the co-workers Globe- iv. alleged losses, loss or expected, should be
Mackay Cable and Radio Corp v. NLRC, 206 SCRA 702 (1992)
proven by SUFFICIENT and CONVINCING EVIDENCE:
-resorted to for the protection of the company’s property
1. audited financial statements, financial
pending investigation of any alleged malfeasance or
condition
misfeasance committed by EE PAL v. NLRC, 292 SCRA 40
2. specify cost-reduction measure actually
(1998)
undertaken in GF
3. audited by independent external auditors
A283. Business related causes
*Temporary Retrenchment = floating status
a. installation of labor-saving devices
-apply by analogy A286: could only last up to 6 months
b. redundancy
-after 6 months, ER should either:
c. retrenchment to prevent losses
i. recall the EEs to work
d. closing or cessation of operation of the establishment or
ii. permanently retrench, following the requirements of law
undertaking unless the closing is for the purpose of
circumventing LC
*Redundancy v. Retrenchment (AG&P United Rank and
File Assn v. NLRC, 265 SCRA 159 (1996)
a. INSTALLATION OF LABOR SAVING DEVICE
Redundancy: services of an employee are in excess of what
-installs machines in lieu of EEs for efficient production
is required by an enterprise
Retrenchment: resorted to primarily to avoid or minimize
b. REDUNDANCY
business losses
*Lopez Sugar Corp v. Franco Doctrine, 458 SCRA 515 (2005):
-where services of an employee are in excess of what is
*Closure v. Retrenchment (Alabang Country Club v.
reasonably demanded by the actual requirements of the
NLRC, 466 SCRA 329 (2005)
enterprise. Position is redundant when it is superfluous, and
Closure: reversal of fortune of ER, complete cessation of
superfluity of a position may be an outcome of a number of
business operations, actual locking-up to prevent further
factors:
financial drain
i. over-hiring of workers
Retrenchment: reduction of personnel usually due to poor
ii. dropping a product line/service activity
financial returns; downsizing
iii. decrease in volume of business
*requirements to be valid (Asian Alcohol v. NLRC, supra):
d. CLOSURE OF BUSINESS
i. written notice served on EE and DOLE 1 month before
Cattista v. NLRC, 247 SCRA 46 (1995)
ii. payment of separation pay
-employer may close or cease his business operations or
iii. GF in abolishing redundant positions
undertaking even if he is ot suffering from serious business
iv. fair and reasonable criteria in ascertaining what
losses or financial reverses AS LONG AS he pays termination
positions are to be declared redundant and accordingly
pay
abolished.
-management prerogative
*Fair and Reasonable Criteria for selecting EEs to be
-as long as in GF to advance its interest and not for the
terminated (Panlilio v. NLRC, 281 SCRA 53 (1997)
purpose of defeating or circumventing the rights of the EEs
i. preferred status
-PARTIAL CLOSURE: allowed to minimize expenses and reduce
ii. efficiency
capitalization
iii.seniority
*its wisdom/soundness not subject to discretionary review so
A284 Disease
long as
-EE found suffering from any disease
i. no violation of law
-EE’s continued employment is prohibited by law/prejudicial to
ii. not merely arbitrary
his health as well as to the health of his co-employees
iii. not malicious action
*hiring of Independent contractor allowed as long as the latter
A286 Temporary Cessation of Operations
is undertaken in order to effectuate more economic and
(San Pedro Hospital of Digos v. SOLE, 263 SCRA 98 (1996)
efficient methods of production. Asian Alcohol Corp v. NLRC,
-valid exercise of management prerogative provided that it is
305 SCRA 416 (1999)
NOT CARRIED OUT in order to circumvent the provisions of the
LC or to defeat the rights of EEs under the LC
c. RETRENCHMENT TO PREVENT LOSSES
-determination: management prerogative. Not required that a
-the termination of employment initiated through no fault of
business continue operating at a loss simply to maintain the
the EEs and without prejudice to the latter
workers in employment, which is tantamount to taking of
-resorted to by the management during periods of business
property without due process
recession, industrial depression or seasonal fluctuations or
-should not be motivated by BF
during lulls occasioned by lack of orders, shortage of
materials, conversion of the plant for a new production
*SPECIAL CASE: Business Transfers
program or the introduction of new materials
-Transferee company not required to recognize the validity of
Requirements (Lopez Sugar Corp v. Franco Doctrine
contracts between EE and former ER (employment contracts,
(2005), supra:
CBA). Sundowner Development v. Drilon, 180 SCRA 14 (1989)
i. losses expected should be substantial, not
merely de minimis in extent
II. Procedural Due Process
-does not include Sliding income: decreasing gross
A277b.
revenues. Not every asserted possibility of loss is sufficient
UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
1. ER shall furnish EE to be terminated with a
written notice containing statement of
causes for termination
2. ER shall affort the EE ample opportunity to
be heard and to defend himself with the
assistance of his representative if he so
desires
3. EE could contest the validity/legality of
dismissal by filing a complaint with regional
branch of NLRC
4. burden of proof on ER
5. if prima facie finding that the termination
may cause a serious labor dispute or is in
implementation a mass lay-off, SOLE may
suspend the effects of the termination
pending resolution of the dispute
*Essence of Due Process: ample opportunity to be heard
and to defend himself
*Right to counsel
-constitutional right
-contemplates right to counsel in Administrative and Quasi-
judicial bodies NOT during investigation of ER Salaw v. NLRC,
202 SCRA 7 (1991)
*Notice requirements
To EE: cannot be substituted, give some time to prepare for
eventual loss of job
To DOLE: enable proper authorities to determine after hearing
WON the termination was done in GF + opportunity to
ascertain and verify alleged cause of termination
*2-notice rule
1st notice: apprises EE of particular acts or omissions for which
dismissal is sought
2nd notice: informs ER’s decision to dismiss EE
*Hearing
-a formal/trial type of hearing is not at all times and in all
instances essential to due process, requirements of which is
satisfied where the parties are accorded fair and reasonable
opportunity to explain side of controversy National Semi-
Conductor Distribution Ltd v. NLRC, 291 SCRA 348 (1998)
-Labor Arbiter cannot be required to hold a formal hearing. He
can ask for position papers in lieu of hearings (New Rules of
Procedure of NLRC, Sec. 5 Rule V)
-no hearing necessary if the EE already admitted
responsibility for act he was accused of Maagos v. NLRC, 300
SCRA 484 (1998)
-due process not violated where a person is given the
opportunity to be heard BUT chooses not to give his side of
the case Caurdenetan Piece Workers Union v. Laguesma, 285
SCRA 291 (1998)
*Failure of Due Process
Wenphil: valid cause for dismissal – due process = valid
dismissal but pay damages
Serrano: valid cause for dismissal – due process = valid
dismissal but pay FULL BACKWAGES
Agabon: just cause – due process = ineffectual dismissal
Other procedural matters:
*burden of proof: on the employer
*weight of evidence: substantial evidence
*prescription period: based on an injury so 4 years from the
time of dismissal
*offer to reinstate: liability for illegal termination not abated.
Wrong has been committed, harm has been done. Ranara v.
NLRC, 212 SCRA 631 (1992)
Santions and Remedies
*twin remedies:
1. reinstatement
-restore the situation as nearly as possible to the status quo
ante the unfair labor practice.
-illegally dismissed EE entitled to it as a matter of right: would
be granted even if EE failed to state it in his complaint
General Baptist Bible College v. NLRC, 219 SCRA 549 (1993)
*exceptions:
i. when the former position is already occupied: reinstate EE
to a substantially equivalent position without loss of seniority
rights as provided for under LC IRR PNOC v. Abella, 448 SCRA
549 (2005)
ii. when EE already reached retirement age at time of filing of
complaint: only entitled to backwages, not separation pay
Espejo v. NLRC, 255 SCRA 430 (1996)
iii.strained relations doctrine: Globe Mackay v. NLRC
-no strained relations: should arise from a valid and legal
act of asserting one’s rights, for otherwise an employee who
shall assert his or her right could be easily separated from the
service by merely paying his/her separation pay on the
pretext that his/her relationship with his/her ER had already
become strained
-strained relations: in order that order that may justify the
award of separation pay in lieu of reinstatement with
backwages
… so compelling and so serious in character
…continued employment of an EE is so obvious to the person
or business of the ER
…the continuation of such employment has become
inconsistent with peace and tranquility which is an ideal
atmosphere in every workplace
*Implementation
-reinstatement pending appeal: ancillary relief granted to a
dismissed EE to cushion him and his family against the impact
of economic dislocation or abrupt loss of income/earnings. It is
immediately executory pending appeal.
- Payroll reinstatement: a form of reinstatement which an
employer may opt to exercise in lieu of an actual
reinstatement. Here, the illegally dismissed employee is to
receive his basic pay without the obligation of rendering any
service to the employer. This occurs when a Labor Arbiter
decides that an employee was illegally dismissed and as a
consequence awards a reinstatement, pursuant to Article 279
of the Labor Code. Such award of reinstatement, according to
Article 223 of the Code, is immediately executory even
pending appeal.
2. backwages
-generally granted on grounds of equity; payment thereof is a
form of relief that restores the income lost by reason of such
unlawful dismissal
-not private compensation or damages: awarded in
furtherance and effectuation of the public objectives of the LC
-not a redress of a private right, but, rather, in the nature of a
command to the ER to make public reparation for dismissing
an employee, either due to the former’s unlawful act or BF St.
Theresa’s School of Novaliches Foundatin v. NLRC, 289 SCRA
110 (1998)
-Failure to claim: since it is a substantial right, failure to
claim in the complaint is a mere procedural lapse which
cannot defeat a right granted under substantive law De la
Cruz v. NLRC, 299 SCRA 1 (1998)
-period: computation:
a. deduct from the backwages TOTAL amount of earnings
obtained from other employment from date of dismissal to
date of reinstatement – EEs not permitted to enrich
themselves at the expense of ER
b. take into account whether in the exercise of due diligence
EEs might have obtained income from suitable remunerative
employment
UP Portia Bar Mental Jugger
Labor Standards
Based on the outline of Professor D.P. Disini, Jr.
c. backwages to be awarded should not be diminished or
reduced by earnings derived by the illegally dismissed
employees elsewhere during the term of his dismissal
d. worker entitled to backwages only up to the time he
reached 65 under law: only give backwages for the period he
could have worked had he not been illegally dismissed
Financial Assistance
When allowed: where the EE is validly dismissed for causes
other than those reflecting his moral character
When not allowed: when dismissed for just and lawful cause,
has something to do with serious misconduct on part of EE or
other causes reflecting adversely on employees moral
character
½ month salary = 15 days + 1/12 of 13th month pay + SIL
cash equivalent
-in retail, service, agricultural establishments/operations + no
more than 10 EEs/workers = exempted from coverage
Types (Gerlach v. Reuters, Ltd., 448 SCRA 335)
1. compulsory and contributory retirement
2. one setup by agreement between the ER and EEs in
CBA and other agreement
3. Voluntarily given by employer
-expressly: announced company policy
-impliedly: failure to contest EE’s claim for retirement
benefits

Separation Pay
-paid after terminated from work due to Authorized causes,
when reinstatement no longer reasonable
-not required when termination is due to closure or cessation
of operation of business establishments due to losses
-computation: wage = pay (includes facilities)
-effect of acceptance: employee not estopped from
challenging the validity of his dismissal; it doesn’t relieve the
employer of legal obligation.

Authorized cause (under *Separation pay

A284)
Installation of labor-saving At least 1 month pay or at
devices least 1 month pay for every
Redundancy year of service, whichever is
higher
Retrenchment to prevent 1 month pay or at least ½
losses month pay for every year of
Closures or cessation of service, whichever is higher
operations of establishment
Undertakings not due to
serious business losses or
financial reverses
*6 months = considered 1 year

Damages
MD/ED: proper where EE had been harassed and arbitrarily
terminated by ER; dismissal attended by BF, constituted an
act oppressive to labor
-claims for damages must have reasonable causal connection
with any of the claims provided for in A217(a) in order to be
cognizable by the Labor arbiter
-ND: granted in sound discretion of the court and relevant
circumstances; given when violation of petitioner’s right to
statutory due process by ER warrants payment of indemnity

XV. Retirement
A287
*Any employee MAY BE RETIRED upon reaching the
RETIREMENT AGE ESTABLIHSED in the
-CBA
-other applicable employment contract
*In case of retirement, the EE shall be entitled to receive such
RETIREMENT BENEFITS as he may have earned under:
-existing laws
-any CBA
-other agreementsw
…Which shall not be less than what is provided
*In the ABSENCE of a retirement plan or agreement providing
for RETIREMENT BENEFITS: upon reaching 60-65 (compulsory
retirement age) years + served at least 5yers in said
establishment
*If Underground mining EE: 50-60 compulsory retirement age
+ at least served 5 years
*RETIREMENT PAY: at least ½ month salary pay for every year
in service (1year=6m)