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NEW ERA UNIVERSITY COLLEGE OF LAW

LABOR LAW REVIEW
Under Atty. Jose-Antonio T. Aliling
1st Semester, AY 2014-2015

Handout No. 01

BASIC STATE POLICIES AND PRINCIPLES
IN RELATION TO LABOR
Article II 1987 Philippine Constitution
Section 9. The State shall promote a just and dynamic social order that will ensure the
prosperity and independence of the nation and free the people from poverty through policies
that provide adequate social services, promote full employment, a rising standard of living, and
an improved quality of life for all.

Section 10. The State shall promote social justice in all phases of national development.

Section 18. The State affirms labor as a primary social economic force. It shall protect the rights
of workers and promote their welfare

Section 20. The State recognizes the indispensable role of the private sector, encourages private
enterprise, and provides incentives to needed investments.
Article XIII 1987 Philippine Constitution
Section 3. The State shall afford full protection to labor, local and overseas, organized and
unorganized, and promote full employment and equality of employment opportunities for all.
It shall guarantee the rights of all workers to self-organizations, 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 on investments, and to expansion and growth.
Labor Code
Article 3. Declaration of basic policy. The State shall afford protection to labor, promote full
employment, ensure equal work opportunities regardless of sex, race or creed and regulate the
relations between workers and employers. The State shall assure the rights of workers to self-
organization, collective bargaining, security of tenure, and just and humane conditions of work.

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Article 4. Construction in favor of labor. All doubts in the implementation and interpretation
of the provisions of this Code, including its implementing rules and regulations, shall be
resolved in favor of labor.
Article 6. Applicability. 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. (As amended by Presidential Decree No. 570-A, November 1, 1974)
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What is the States commitment and obligation under Section 3, Article XIII of the
Constitution?
A. General
1. Afford Full Protection to labor;
2. Promote Full Employment; and
3. Promote Equality of Employment Opportunities for all.
B. Labor Relations
1. Guarantee the rights of all workers to self-organizations;
2. Guarantee peaceful concerted activities, including the right to strike in
accordance with law;
3. Guarantee employees right to participate in policy and decision-making
processes affecting their rights and benefits as may be provided by law;
4. Promote the principle of shared responsibility between workers and employers;
5. Promote the preferential use of voluntary modes in settling disputes, including
conciliation, and shall enforce their mutual compliance therewith to foster
industrial peace.
C. Labor Standards / Rights of Employees
1. Ensure the employees right to security of tenure;
2. Ensure the employees right to humane conditions of work;
3. Ensure the employees right to a living wage;
4. Assist in recognizing the right of labor to its just share in the fruits of production;
D. Right of the Employer

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1. Protect and recognize the right of enterprises to reasonable returns on
investments and to expansion and growth. Note that the State recognizes the
indispensable role of the private sector, encourages private enterprise, and
provides incentives to needed investments.

*Trivia:
President Benigno S. Aquino III when he was a Senator introduced Bill No. 1370 entitled
An Act Granting an Annual Productivity Incentive to All Workers in the Private
Sector...
What are the 7 basic constitutional rights of labor?

1. Self-organization
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
Is the protection mandated by the Constitution in favor of labor limited to domestic based
employees?
No, the Constitution expressly states that the protection to labor shall extend even to overseas
employees.
Is the protection mandated by the Constitution in favor of labor limited to employees who
are members of unions?
No, the Constitution expressly states that the protection to labor shall extend even to
unorganized employees.
Furthermore Article 6 of the Labor Code expressly states that the rights protected by the Labor
Code and the Benefits Extended thereof is applicable to ALL employees unless otherwise
expressly excluded.
Are foreign employees working in the Philippines also entitled to the protection of the State?
Yes. The protection is extended to all employees. The Constitution does not distinguish between
citizens and aliens.
Furthermore Article 6 of the Labor Code expressly states that the rights protected by the Labor
Code and the Benefits Extended thereof is applicable to ALL employees unless otherwise
expressly excluded.
What is Social Justice?

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Maximo Calalang v. A.D. Williams
G.R. No. 47800
02 December 1940
70 Phil. 726
The promotion of social justice is to be achieved not through a mistaken sympathy towards
any given group. Social justice is "neither communism, nor despotism, nor atomism, nor
anarchy," but the humanization of laws and the equalization of social and economic forces by
the State so that justice in its rational and objectively secular conception may at least be
approximated. Social justice means the promotion of the welfare of all the people, the adoption
by the Government of measures calculated to insure economic stability of all the competent
elements of society, through the maintenance of a proper economic and social equilibrium in
the interrelations of the members of the community, constitutionally, through the adoption of
measures legally justifiable, or extra-constitutionally, through the exercise of powers underlying
the existence of all governments on the time-honored principle of salus populi est suprema lex.
Social justice, therefore, must be founded on the recognition of the necessity of interdependence
among divers and 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, consistent
with the fundamental and paramount objective of the state of promoting the health, comfort,
and quiet of all persons, and of bringing about the greatest good to the greatest number.
*** Trivia: Calalang v. Williams is not actually a labor case. Its a case on delegation of legislative
power.
Philippine Long Distance Telephone v. NLRC
164 SCRA 671, 682-683.

The policy of social justice is 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. Social
justice cannot be permitted to be the refuge of scoundrels any more than can equity be an
impediment to the punishment of the guilty. Those who invoke social justice may do so only if
their hands are clean and their motives blameless and not simply because they happen to be
poor. This great policy of our Constitution is not meant for the protection of those who have
proved they are not worthy of it, like the workers who have tainted the cause of labor with the
blemishes of their own character.
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Key Formula: Industrial peace + Progress = Social Justice
INTERPRETATION OF DOUBTS IN LABOR CODE
What is the reason for According Greater Protection to Employees? Why are all doubts in the
implementation and interpretation of the provisions of this Code, including its
implementing rules and regulations, resolved in favor of labor? Does this not violate the
equal protection clause?

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Philippine Long Distance Telephone v. NLRC, 164 SCRA 671, 682-683.


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Daniel Sanchez, et al. V. Harru Lyons Construction, Inc., et al.
G.R. No. L-2779
18 October 1950

In the matter of employment bargaining, there is no doubt that the employer stands on higher
footing than the employee. First of all, there is greater supply than demand for labor. Secondly,
the need for employment by labor comes from vital and even desperate, necessity.
Consequently, the law must protect labor, at least, to the extent of raising him to equal footing
in bargaining relations with capital and to shield him from abuses brought about by the
necessity for survival. It is safe to presume therefore, that an employee or laborer who waives in
advance any benefit granted him by law does so, certainly not in his interest or through
generosity but under the forceful intimidation of urgent need, and hence, he could not have so
acted freely and voluntarily.

*Article 4 does not violate the Equal Protection Clause, because as mentioned in the Sanchez
case, its purpose is actually to provide such equality between capital and labor.



Philippine Long Distance Telephone Company v. NLRC and Lettie Corpuz
G.R. No. 111933
23 July 1997
In carrying out and interpreting the Labor Code's provisions and its implementing regulations,
the workingman's welfare should be the primordial and paramount consideration. This kind of
interpretation gives meaning and substance to tile liberal and compassionate spirit of the law as
provided for in Article 4 of the Labor Code, as amended, which states that ''all doubts in the
implementation and interpretation of the provisions of the Labor Code including its
implementing rules and regulations shall be resolved in favor of labor, as well as the
Constitutional mandate that the State shall afford full protection to labor and promote full
employment opportunities for all. Likewise, it shall guarantee the rights of all workers to
security of tenure. Such constitutional right should not be denied on mere speculation of any
unclear and nebulous basis.
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Martiniano Sarmiento v. Employees Compensation Commission and GSIS
G.R. No. L-68648
24 September 1986
Strict rules of evidence are not applicable in claims for compensation. There are no stringent
criteria to follow. The degree of proof required under P.D. 626, is merely substantial evidence,
which means, "such relevant evidence as a reasonable mind might accept as adequate to

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See also Manila Electric Company v. NLRC, 175 SCRA 277 (1989); Abella v. NLRC, 152 SCRA 140 (1987); and Tolentino v.
NLRC, 152 SCRA 717 (1987).


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support a conclusion". The claimant must show, at least, by substantial evidence that the
development of the disease is brought largely by the conditions present in the nature of the job.
What the law requires is a reasonable work-connection and not a direct causal relation. It is
enough that the hypothesis on which the workmen's claim is based is probable. Medical opinion
to the contrary can be disregarded especially where there is some basis in the facts for inferring
a work-connection. Probability not certainty is the touchstone.
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This kind of interpretation gives meaning and substance to the liberal and compassionate spirit
of the law as embodied in Article 4 of the New Labor Code which states that "all doubts in the
Article 4 of the New Labor Code which states that "all doubts in the implementation and
interpretation of the provisions of this Code including its implementing rules and regulations
shall be resolved in favor of labor". The policy is to extend the applicability of the decree to a
greater number of employees who can avail of the benefits under law, which is in consonance
with the avowed policy of the State to give maximum aid and protection to labor.
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It appears that Section 3, Article XIII of the 1987 Constitution is focused on only protecting
labor, is this true? Then Article 4 of the Labor Code mandates that doubts should be
interpreted in favor of labor? How about the employer, is he not entitled to protection?

1) Employer has right to equal protection of the law and to justice.

Uniwide Sales Warehouse Club and Vivian Apduhan
v. NLRC and Amalia Kawada
G.R. No. 154503
29 February 2008

It should be remembered that the Philippine Constitution, while inexorably committed towards
the protection of the working class from exploitation and unfair treatment, nevertheless
mandates the policy of social justice so as to strike a balance between an avowed predilection
for labor, on the one hand, and the maintenance of legal rights of capital, the proverbial hen that
lays the golden egg, on the other. Indeed, we should not be unmindful of the legal norm that
justice is in every case for the deserving, to be dispensed with in light of established facts, the
applicable law, and existing jurisprudence.
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SolidBank Corporation v. NLRC, et al.
G.R. No. 165951
30 March 2010

Withal, the law, in protecting the rights of the laborers, authorizes neither oppression nor self-
destruction of the employer. While the Constitution is committed to the policy of social justice

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See also San Valentin v. Employees' Compensation Commission, 118 SCRA 160; Better Building, Inc. v. Pucan, 135 SCRA
62; Cristobal v. Employees' Compensation Commission, supra, citing Ang Tibay v. Court of Industrial Relations and
National Labor Union, Inc., 69 Phil. 635; and Acosta v. Employees' Compensation Commission, 109 SCRA 209.

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See also Acosta v. Employees' Compensation Commission. 109 SCRA 209.
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See also Portuguez v. GSIS Family Bank (Comsavings Bank) supra note 50, at 326-327, citing Cebu Metal Corporation v.
Salilling, G.R. No. 154463, September 5, 2006, 501 SCRA 61; National Sugar Refineries Corp. v. NLRC, 220 SCRA 452;
Homeowners Saving & Loan Association, Inc. v. NLRC, GR No. 97067, 262 SCRA 406.


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and the protection of the working class, it should not be supposed that every labor dispute will
be automatically decided in favor of labor. The management also has its own rights, as such, are
entitled to respect and enforcement in the interest of simple fair play. Out of its concern for
those with less privileges in life, the Supreme Court has inclined more often than not toward the
worker and upheld his cause in his conflicts with the employer. Such favoritism, however, has
not blinded the Court to the rule that justice is in every case for the deserving, to be dispensed
in the light of the established facts and applicable law and doctrine.
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Jenny and Virgilio Agabon v. NLRC, et al.
G.R. No. 158693
17 November 2004

The constitutional policy to provide full protection to labor is not meant to be a sword to
oppress employers. The commitment of this Court to the cause of labor does not prevent us
from sustaining the employer when it is in the right, as in this case.
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Colgate Palmolive Philippines, Inc. vs. Ople
G.R. No. 73681
30 June 1988

Under the law, the Secretary of Labor is duly mandated to equally protect and respect not only
the labor or workers' side but also the management and/or employers' side.

2) Right to Return on Investment, and to Expansion and Growth.
The Philippine Constitution recognizes the right of enterprises to reasonable returns on
investments, and to expansion and growth (Section 3, Article XIII, 1987 Constitution).

3) Right to Exercise Management Prerogatives.

Maya Farms Employees Organization, et al. v. NLRC, et al.
G.R. No. 106256
28 December 1994
In Abbott Laboratories (Phils.) Inc. vs. NLRC,
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we (the Supreme Court) had occasion to uphold the
employer in its exercise of what are clearly management prerogatives, thus:
The hiring, firing, transfer, demotion, and promotion of employees has
been traditionally, identified as a management prerogative subject to
limitations found in law, a collective bargaining agreement or general

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See also Manuel Sosito v. Aguinaldo Development Corporation, G.R. No. L-48926, 14 December 1987.

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See also Capili v. NLRC, G.R. No. 117378, 26 March 1997, 270 SCRA 488, 495.

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154 SCRA 713 [1987].


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principles of fair play and justice. This is a function associated with the
employer's inherent right to control and manage effectively its enterprise.
Even as the law is solicitous of the welfare of the employees, it must also
protect the right of an employer to exercise what are clearly management
prerogatives. The free will of management to conduct its own business
affairs to achieve its purpose cannot be denied (see Dangan vs. National
Labor Relations Commission, 127 SCRA 706).
The rule is well-settled that labor laws discourage interference with an employer's judgment in
the conduct of his business. Even as the law is solicitous of the welfare of employees, it must
also protect the right of an employer to exercise what are clearly management prerogatives. As
long as the company's exercise of the same 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.
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LABOR CODE

Article 211. Declaration of Policy.

A. It is the policy of the State:
(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;
(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;
(e) To provide an adequate administrative machinery for the expeditious settlement
of labor or industrial disputes;
(f) To ensure a stable but dynamic and just industrial peace; and
(g) To ensure the participation of workers in decision and policy-making processes
affecting then- rights, duties and welfare.

B. To encourage a truly democratic method of regulating the relations between the
employers and employees by means of agreements freely entered into through collective
bargaining, no court or administrative agency or official shall have the power to set or fix
wages, rates, conditions of employment, except as otherwise provided under this Code.

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Union Carbide Labor Union v. Union Carbide Philippines, 215 SCRA 554; National Federation of Labor Unions (NAFLU)
v. NLRC, 202 SCRA 346; Philippine Telegraph and Telephone Corporation v. Laplana, 199 SCRA 485; Cruz v. Medina, 177
SCRA 565; San Miguel Brewery Sales Force Union (PTGWO) v. Ople, 170 SCRA 25.

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What does the Labor Code mean when it says that the State shall encourage a truly
democratic method of regulating the relations between the employers and employees?
Why does it appear that the Constitution and Labor Code emphasizes the concept of
VOLUNTARY Modes of Settling Dispute, Primacy of FREE Collective Bargaining in relation
to Labor Relations?


SSSEA, et al. v. Court of Appeals, et al.
G.R. No. 85279
28 July 1989

The principle behind labor unionism in private industry is that industrial peace cannot be
secured through compulsion by law. Relations between private employers and their employees
rest on an essentially voluntary basis. Subject to the minimum requirements of wage laws and
other labor and welfare legislation, the terms and conditions of employment in the unionized
private sector are settled through the process of collective bargaining.

Illustration.
Hiring policies Employees Benefits CBA
Voluntary
Basis
Employer free to
impose hiring
policies
General Rule: based on
agreed terms of parties.
Employee and Employer
free to negotiate the terms
on their own.

Compulsion
of Law
The above is subject
to restriction set by
law: No
discrimination due
to sex, race, religion
or political beliefs,
or discrimination
due to reasons of
pregnancy.
Cannot go below
minimum prescribed by
the Labor Code or other
pertinent regulations.

Ex. Minimum Wage,
Book III of Labor Code
sets minimum for
Conditions of
Employment.
If deadlock, submit issue
to Voluntary Arbitrator, or
in cases of industries
indispensible to National
Interest, Compulsory
Arbitration.

Note: Article 211 of the Labor Codes strictly mandates that NO court or administrative
agency or official shall have the power to set or fix wages, rates, conditions of employment,
except as otherwise provided under this Code.

LAW only sets the Minimum requirement or the Legal Boundaries. PARTIES agree on
the terms. GOVERNMENT intervenes only when there is a breach of the Legal
Boundaries or non-compliance with the minimum set by law.

Other provisions that protect the rights or promote the welfare of workers:

a. 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. III, Bill of Rights, Sec. 8)

b. The right of self-organization shall not be denied to government employees. No officer
or employee of the civil service shall be removed or suspended except for cause

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provided by law. Temporary employees of the Government shall be given such
protection as may be provided by law. (Art. IX-B, The Civil Service Commission, Sec.
2[3], [5] and [6])

c. Regular farmworkers shall have the right to own directly or collectively the lands they
till. Other farmworkers shall receive a just share of the fruits of the land they till. The
State recognizes the right of farmworkers, along with other groups, to take part
in the planning, organization and management of the agrarian reform program.
Landless farmworkers may be resettled by the Government in its own agricultural
estates. (Art. XIII, Secs. 4, 5 and 6, Social Justice and Human Rights)

d. The State shall, by law, and for the common good, undertake, in cooperation
with the private sector, a continuing program of urban land reform and housing
which will make available at affordable cost decent housing and basic services to
underprivileged and homeless citizens in urban centers and resettlement areas. It
shall also promote adequate employment opportunities to such citizens. (Art. XIII,
Sec. 9)

e. 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. (Art. XIII, Sec. 14)

f. Along with other sectors, labor is entitled to seats allotted to party-list
representatives for three consecutive terms after the ratification of the
Constitution. (Art. VI, The Legislative Department)

g. The goals of the national economy are a more equitable distribution of
opportunities, income, and wealth; a sustained increase in the amount of goods and
services produced by the nation for the benefit of the people; and an expanding
productivity as the key to raising the quality of life for all, especially the
underprivileged. The State shall promote industrialization and full employment
based on sound agricultural development and agrarian reform, through
industries that make full and efficient use of human and natural resources. (Art.
XII, National Economy and Patrimony)

h. Congress shall create an agency to promote the viability and growth of
cooperatives as instruments for social justice and economic development. (Art.
XII, Sec. 15)

i. At the earliest possible time, the Government shall increase the salary scales of the
other officials and employees of the National Government. (Art. XVIII,
Transitory Provisions, Sec. 18)

j. Career civil service employees separated from the service not for cause but as a result
of the reorganization shall be entitled to appropriate separation pay and to
retirement and other benefits under existing laws. In lieu thereof, they may also be
considered for reemployment in the Government. Those whose resignations have
been accepted in line with the existing policy shall also have this right. (Art. XVIII,
Transitory Provisions, Sec. 16)

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The Civil Code

"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. 1700) This being so,
"Neither capital nor labor shall act oppressively against the other, or impair the
interest or convenience of the public." (Art. 1701)

Article 1703 of the Civil Code states: "No contract which practically amounts to involuntary
servitude, under any guise whatsoever, shall be valid." Because of this law an employer cannot forbid
an employee from resigning from his job, subject to the observance of the terms of the
employment contract itself and the procedure on resignation under Art. 285 of the Labor Code.

The Revised Penal Code

Article 289 of the Revised Penal Code punishes the use of violence or threats by either employer
or employee. It says: "The penalty of arresto mayor and a fine not exceeding P300 pesos shall be
imposed upon any person who, for the purpose of organizing, maintaining or preventing
coalitions of capital or labor, strike of laborers or lockout of employers, shall employ violence or
threats in such a degree as to compel or force the laborers or employers in the free and legal
exercise of their industry or work, if the act shall not constitute a more serious offense in
accordance with the provisions of this Code."


INTERNATIONAL CONVENTIONS

The International Labor Organization (ILO) is the UN specialized agency which seeks the
promotion of social justice and internationally recognized human and labor rights. An essential
characteristic of ILO is tripartism, that is, it is composed not only of government
representatives but also of employers' and workers' organizations.

The Philippines signed in as a member of the ILO on June 15, 1948.

International Commitments

By being an ILO member the country thereby subscribes to the fundamental principles on which
the ILO is based and, in particular, that

a. labor is not a commodity;
b. freedom of expression and of association are essential to sustained progress;
c. that poverty anywhere constitutes a danger to prosperity everywhere;
d. the was against want requires to be carried on with unrelenting vigor within each

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nation, and by continuous and concerted international effort in which the
representatives of workers and employers, enjoying equal status with those of
governments, join with them in free discussion and democratic decision with a view to
the promotion of the common welfare.

ILO Core Conventions

The eight core Conventions are as follows:

Forced Labor Convention, 1930 (No. 29);
Freedom of Association and Protection of the Right to Organize Convention, 1948 (No.
87);
Right to Organize and Collective Bargaining Convention, 1949 (No. 98);
Equal Remuneration Convention, 1951 (No. 100);
Abolition of Forced Labor Convention, 1957 (No. 105);
Discrimination (Employment and Occupation) Convention, 1958 (No. 111);
Minimum Age Convention, 1973 (No. 138); and
Worst Forms of Child Labor Convention, 1999 (No. 182).