SUGGESTED ANSWERS TO THE 2017 BAR EXAMINATIONS IN LABOR AND SOCIAL

LEGISLATION: PART TWO:

VIII
Marciano was hired as Chief Engineer on board the vessel M/V Australia. His contract of
employment was for nine months. After nine months, he was re-hired. He was hired a third time
after another nine months. He now claims entitlement to the benefits of a regular employee
based on his performed tasks usually necessary and desirable to the employer’s business for a
continuous period of more than one year. Is Marciano’s claim tenable? Explain.
SUGGESTED ANSWER:
Marciano’s claim is not tenable. The Supreme Court squarely passed upon the issue in Millares
v. NLRC, G.R. No. 110524, July 29, 2002, where one of the issues raised was whether seafarers
are regular or contractual employees whose employment are terminated every time their
contracts of employment expire. The Supreme Court explained:
[I]t is clear that seafarers are considered contractual employees. They can not be considered as
regular employees under Article 280 of the Labor Code. Their employment is governed by the
contracts they sign everytime they are rehired and their employment is terminated when the
contract expires. Their employment is contractually fixed for a certain period of time. They fall
under the exception of Article 280 whose employment has been fixed for a specific project or
undertaking the completion or termination of which has been determined at the time of
engagement of the employee or where the work or services to be performed is seasonal in
nature and the employment is for the duration of the season. We need not depart from the rulings
of the Court in the two aforementioned cases which indeed constitute stare decisis with respect
to the employment status of seafarers.
NOTE: The foregoing answer can be found in page 739 of the book entitled Principles and Cases
Labor Relations, First Edition 2016, by Atty. Voltaire T. Duano. The topic on the seafarers has
been time and again the subject matter of bar questions, more specifically during the 2014 and
2002 Bar Examinations.
IX
Section 255 (245) of the Labor Code recognizes three categories of employees , namely:
managerial, supervisory, and rank-and-file.
(a) Give the characteristics of each category of employees, and state whether the employees in
each category may organized and form unions. Explain your answer. (5%)
SUGGESTED ANSWER:
Under Article 255 [245] of the Labor Code the following are provided:
Managerial employees are not eligible to join, assist or form any labor organization.
Supervisory employees shall not be eligible for membership in the collective bargaining unit of
the rank-and-file employees but may join, assist or form separate collective bargaining units
and/or legitimate labor organizations of their own.
The rank-and-file union and the supervisors’ union operating within the same establishment may
join the same federation or national union.
(b) May confidential employees who assist managerial employees, and who act in a confidential
capacity or have access to confidential matters being handled by persons exercising managerial
functions in the field of labor relations form, or assist, or join labor unions? Explain your answer?
(2.5%)
SUGGESTED ANSWER:
No. In Tunay na Pagkakaisa ng Manggagawa sa Asia Brewery v. Asia Brewery, Inc., G.R. No.
162025, August 3, 2010, the High Court explained, who are those confidential employees
covered by the prohibition to join, form and assist any labor organization under Article 245 [now
255] of the Labor Code, as follows:
Confidential employees are defined as those who (1) assist or act in a confidential capacity, (2)
to persons who formulate, determine, and effectuate management policies in the field of labor
relations. The two (2) criteria are cumulative, and both must be met if an employee is to be
considered a confidential employee that is, the confidential relationship must exist between the
employee and his supervisor, and the supervisor must handle the prescribed responsibilities
relating to labor relations. The exclusion from bargaining units of employees who, in the normal
course of their duties, become aware of management policies relating to labor relations is a
principal objective sought to be accomplished by the confidential employee rule. (San Miguel
Corp. Supervisors and Exempt Employees Union v. Laguesma, G.R. No. 110399, August 15,
1997, 277 SCRA 370, 374-375, citing Westinghouse Electric Corp. v. NLRB (CA6) 398 F2d 669
(1968), Ladish Co., 178 NLRB 90 (1969) and B.F. Goodrich Co., 115 NLRB 722 [1956])
NOTE: The foregoing answer can be found in page 273 of the book entitled Principles and Cases
Labor Relations, First Edition 2016, by Atty. Voltaire T. Duano. The topic on the confidential
employees covered by the prohibition has been time and again the subject matter of bar
questions, more specifically during the 2014, 2011, 2009, 2002 and 1999 Bar Examinations.
X.
A.
The labor sector has been loudly agitating for the end of labor-only contracting, as distinguished
from job contracting. Explain these two kinds of labor contracting, give the effect of a finding that
one is a labor-only contractor. Explain your answers. (4%)
SUGGESTED ANSWER:
The Supreme Court in Polyfoam-RGC International Corporation vs. Concepcion, G.R. No.
172349, June 13, 2012 citing Sasan, Sr. v. National Labor Relations Commission 4th Division,
G.R. No. 176240, October 17, 2008, 569 SCRA 670 distinguished permissible job contracting or
subcontracting from “labor-only” contracting, to wit:
“Permissible job contracting or subcontracting refers to an arrangement whereby a principal
agrees to put out or farm out to a contractor or subcontractor the performance or completion of a
specific job, work or service within a definite or predetermined period, regardless of whether such
job, work or service is to be performed or completed within or outside the premises of the
principal. A person is considered engaged in legitimate job contracting or subcontracting if the
following conditions concur:
(a) The contractor or subcontractor carries on a distinct and independent business and
undertakes to perform the job, work or service on its own account and under its own
responsibility according to its own manner and method, and free from the control and direction of
the principal in all matters connected with the performance of the work except as to the results
thereof;
(b) The contractor or subcontractor has substantial capital or investment; and
(c) The agreement between the principal and contractor or subcontractor assures the contractual
employees entitlement to all labor and occupational safety and health standards, free exercise of
the right to self-organization, security of tenure, and social and welfare benefits.
In contrast, labor-only contracting, a prohibited act, is an arrangement where the contractor or
subcontractor merely recruits, supplies or places workers to perform a job, work or service for a
principal. In labor-only contracting, the following elements are present:
(a) The contractor or subcontractor does not have substantial capital or investment to actually
perform the job, work or service under its own account and responsibility; and
(b) The employees recruited, supplied or placed by such contractor or subcontractor are
performing activities which are directly related to the main business of the principal.” (Sasan, Sr.
v. National Labor Relations Commission 4th Division, supra, at pp. 689-690. [Citations omitted])
In PCI Automation Center, Inc. v. NLRC, G.R. No. 115920, January 29, 1996, the effect of a
finding that one is a labor-only contractor was ruled as follows:
In legitimate job contracting, no employer-employee relationship exists between the employees
of the job contractor and the principal employer. Even then, the principal employer becomes
jointly and severally liable with the job contractor for the payment of the employees’ wages
whenever the contractor fails to pay the same. In such case, the law creates an employer-
employee relationship between the principal employer and the job contractor’s employees for a
limited purpose, that is, to ensure that the employees are paid their wages. Other than the
payment of wages, the principal employer is not responsible for any claim made by the
employees. (Philippine Bank of Communications vs. NLRC, 146 SCRA 347 [1986])
On the other hand, in labor-only contracting, an employer-employee relationship is created by
law between the principal employer and the employees of the labor-only contractor. In this case,
the labor-only contractor is considered merely an agent of the principal employer. The principal
employer is responsible to the employees of the labor-only contractor as if such employees had
been directly employed by the principal employer. The principal employer therefore becomes
solidarily liable with the labor-only contractor for all the rightful claims of the employees.
(Philippine Bank of Communications vs. NLRC, 146 SCRA 347 [1986])
Thus, in legitimate job contracting, the principal employer is considered only an indirect
employer, (Article 107, Labor Code, as amended) while in labor-only contracting, the principal
employer is considered the direct employer of the employees. (last paragraph of Article 106,
Labor Code, as amended)
In short, the legitimate job contractor provides services while the labor-only contractor provides
only manpower. The legitimate job contractor undertakes to perform a specific job for the
principal employer while the labor-only contractor merely provides the personnel to work for the
principal employer.
NOTE: The foregoing answer can be found in pages 507508 of the book entitled Principles and
Cases Labor Relations, First Edition 2016, by Atty. Voltaire T. Duano. The topic on job-
contracting and labor-only contracting has been time and again the subject matter of bar
questions, more specifically during the 2014, 2013, 2012, 2011, 2009, 2004, 2002, 2001, 2000,
1997 and 1994 Bar Examinations.
B.
What are the grounds for validly terminating the services of an employee based on a just cause?
(5%)
SUGGESTED ANSWER:
An employer may terminate an employment for any of the following causes:
(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his
employer or representative in connection with his work;
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of the trust reposed in him by his employer or duly
authorized representative;
(d) Commission of a crime or offense by the employee against the person of his employer or any
immediate member of his family or his duly authorized representatives; and
(e) Other causes analogous to the foregoing. (Art. 297 [282], Labor Code)
NOTE: The foregoing answer can be found in pages 899-890 of the book entitled Principles and
Cases Labor Relations, First Edition 2016, by Atty. Voltaire T. Duano. The topic on the just cause
for termination has been time and again the subject matter of bar questions, more specifically
during the 2015, 2014, 2013, 2012, 2011, 2009, 2008, 2006, 2003, 2001, 1995, 1996, 1995,
1999 Bar Examinations.
C.
Give the procedure to be observed for validly terminating the services of an employee based on
a just cause? (4%)
SUGGESTED ANSWER:
As defined in Article 297 of the Labor Code, as amended, the requirement of two written notices
served on the employee shall observe the following:
(a) The first written notice should contain:
1. The specific causes or grounds for termination as provided for under Article 297 of the Labor
Code, as amended, and company policies, if any;
2. Detailed narration of the facts and circumstances that will serve as basis for the charge
against the employee. A general description of the charge will not suffice; and
3. A directive that the employee is given opportunity to submit a written explanation within a
reasonable period.
“Reasonable period” should be construed as a period of at least five (5) calendar days from
receipt of the notice to give the employee an opportunity to study the accusation, consult or be
represented by a lawyer or union officer, gather data and evidence, and decide on the defenses
against the complaint. (Unilever v. Rivera, G.R. No. 201701, June 3, 2013; Section 12, DOLE
Department Order 18-A)
(b) After serving the first notice, the employer should afford the employee ample opportunity to
be heard and to defend himself/herself with the assistance of his/her representative if he/she so
desires, as provided in Article 299 (b) of the Labor Code, as amended.
“Ample opportunity to be heard” means any meaningful opportunity (verbal or written) given to
the employee to answer the charges against him/her and submit evidence in support of his/her
defense, whether in a hearing, conference or some other fair, just and reasonable way. A formal
hearing or conference becomes mandatory only when requested by the employee in writing or
substantial evidentiary disputes exist or a company rule or practice requires it, or when similar
circumstances justify it. (Perez v. PT&T, G.R. No. 152048, April 7, 2009, Section 12, DOLE
Department Order 18-A)
(c) After determining that termination of employment is justified, the employer shall serve the
employee a written notice of termination indicating that: (1) all circumstances involving the
charge against the employee have been considered; and (2) the grounds have been established
to justify the severance of their employment.
The foregoing notices shall be served personally to the employee or to the employee’s last
known address. (Section 5, 5.1, Rule I-A, D.O. No. 147-15, Series of 2015)
NOTE: The foregoing answer can be found in pages 899-890 of the book entitled Principles and
Cases Labor Relations, First Edition 2016, by Atty. Voltaire T. Duano. The topic on the
procedural due process has been time and again the subject matter of bar questions, more
specifically during the 2012, 2009, 2006, 1999 and 1998 Bar Examinations.
XI
A.
The modes of determining the exclusive bargaining agent of the employees in a business are: (a)
voluntary recognition; (b) certification election; and (c) consent election. Explain how they differ
from one another. (4%)
SUGGESTED ANSWER:
Voluntary Recognition refers to the process by which a legitimate labor union is recognized by
the employer as the exclusive bargaining representative or agent in a bargaining unit, reported
with the Regional Office in accordance with Rule VII, Section 2 of these Rules. Certification
Election” or Consent Election refers to the process of determining through secret ballot the sole
and exclusive representative of the employees in an appropriate bargaining unit for purposes of
collective bargaining or negotiation. A certification election is ordered by the Department, while a
consent election is voluntarily agreed upon by the parties, with or without the intervention by the
Department. (Rule I, Section 1, Book V, Rules to Implement the Labor Code)
NOTE: The foregoing answer can be found in pages 21 and 22 of the book entitled Principles
and Cases Labor Relations, First Edition 2016, by Atty. Voltaire T. Duano. The topic on the
representation issue has been time and again the subject matter of bar questions, more
specifically during the 2006, 2004, and 2000 Bar Examinations.
B.
Marcel was the Vice President for Finance and Administration and a member of the Board of
Directors of Mercedes Corporation. He brought a complaint for illegal suspension and illegal
dismissal against Mercedes Corporation, which moved to dismiss the complaint on the ground
that the complaint pertained to the jurisdiction of the RTC due to the controversy being
intracorporate based on his positions in the corporation. Marcel countered that he had only been
removed as Vice President for Finance and Administration, not as a member of the Board of
Directors. He also argued that his position was not listed as among the corporate offices in
Mercedes Corporation’s by-law. Is the argument of Marcel correct? Explain your answer. (2.5%)
SUGGESTED ANSWER:
Marcel’s contention is correct. It is settled in Matling Industrial and Commercial Corporation v.
Coros, G.R. No. 157802, 13 October 2010, cited in Marc II Marketing Inc. v. Joson, G.R. No.
171993, December 12, 2011, where it held, thus:
Conformably with Section 25, a position must be expressly mentioned in the [b]y-[l]aws in order
to be considered as a corporate office. Thus, the creation of an office pursuant to or under a [b]y-
[l]aw enabling provision is not enough to make a position a corporate office. [In] Guerrea v.
Lezama [citation omitted] the first ruling on the matter, held that the only officers of a corporation
were those given that character either by the Corporation Code or by the [b]y-[l]aws; the rest of
the corporate officers could be considered only as employees or subordinate officials.
xxx
It is relevant to state in this connection that the SEC, the primary agency administering the
Corporation Code, adopted a similar interpretation of Section 25 of the Corporation Code in its
Opinion dated November 25, 1993 [citation omitted], to wit:
Thus, pursuant to the above provision (Section 25 of the Corporation Code), whoever are the
corporate officers enumerated in the by-laws are the exclusive Officers of the corporation and the
Board has no power to create other Offices without amending first the corporate [b]y-laws.
However, the Board may create appointive positions other than the positions of corporate
Officers, but the persons occupying such positions are not considered as corporate officers
within the meaning of Section 25 of the Corporation Code and are not empowered to exercise
the functions of the corporate Officers, except those functions lawfully delegated to them. Their
functions and duties are to be determined by the Board of Directors/Trustees. (Matling Industrial
and Commercial Corporation v. Coros, supra at 26-27) [Emphasis supplied.]
With the given circumstances and in conformity with Matling Industrial and Commercial
Corporation v. Coros, Marcel was not a corporate officer of Mercedes Corporation because his
position as Vice President for Finance and Administration was not specifically mentioned in the
roster of corporate officers in its corporate by-laws.
NOTE: The foregoing answer can be found in page 46 of the book entitled Principles and Cases
Labor Relations, First Edition 2016, by Atty. Voltaire T. Duano. The topic on the on whether an
position is a corporate officer has been time and again the subject matter of bar questions, more
specifically during the 2015, 2014, 2011 and 1996 Bar Examinations.
C.
State the jurisdiction of the Voluntary Arbitrator, or Panel of Voluntary Arbitrators in labor
disputes? (4%)
SUGGESTED ANSWER:
The voluntary arbitrator or panel of voluntary arbitrators shall have exclusive and original
jurisdiction to hear and decide all unresolved grievances arising from:
1. The implementation or interpretation of the collective bargaining agreements; (Article 274
[261], Labor Code, Section 4, Rule XIX, Book V, Omnibus Rules Implementing the Labor Code)
2. The interpretation or enforcement of company personnel policies which remain unresolved
after exhaustion of the grievance procedure; (Article 274 [261], Labor Code, Section 4, Rule XIX,
Book V, Omnibus Rules Implementing the Labor Code)
3. Wage distortion issues arising from the application of any wage orders in organized
establishments; (par. 4, Article 124, Labor Code, Section 4, Rule XIX, Book V, Omnibus Rules
Implementing the Labor Code)
4. The interpretation and implementation of the productivity incentive programs under RA 6971.
5. Upon agreement of the parties, shall also hear and decide all other labor disputes including
unfair labor practices and bargaining deadlocks. (Article 275. [262], Labor Code, Section 4, Rule
XIX, Book V, Omnibus Rules Implementing the Labor Code)
6. Violations of a Collective Bargaining Agreement, except those which are gross in character,
shall no longer be treated as unfair labor practice and shall be resolved as grievances under the
Collective Bargaining Agreement; (Article 274. [261], Labor Code)
NOTE: The foregoing answer can be found in page 442 of the book entitled Principles and Cases
Labor Relations, First Edition 2016, by Atty. Voltaire T. Duano. The topic on jurisdiction of the
voluntary arbitrators or panel of voluntary arbitrators has been time and again the subject matter
of bar questions, more specifically during the 2008, 2001, 1997 and 1995 Bar Examinations.
XII
A.
Juanito initiated a case for illegal dismissal against Mandarin Company. The Labor Arbiter
decided in his favor, and ordered his immediate reinstatement with full backwages and without
loss of seniority and other benefits. Mandarin Company did not like to allow him back in its
premises to prevent him from influencing his co-workers to move against the interest of the
company; hence, it directed his payroll reinstatement and paid his full backwages and other
benefits even as it appealed to the NLRC.
A few months later, the NLRC reversed the ruling of the Labor Arbiter and declared that Juanito’s
dismissal was valid. The reversal ultimately became final.
May Mandarin Company recover the backwages and other benefits paid to Juanito pursuant to
the decision of the Labor Arbiter in view of the reversal by the NLRC? Rule, with reasons. (2.5%)
SUGGESTED ANSWER:
Mandarin Company cannot recover the backwages and other benefits paid to Juanito pursuant to
the decision of the Labor Arbiter despite the reversal by the NLRC. The refund doctrine has
already been reversed in Garcia v. Philippine Airlines, Inc., G. R. No. 164856, July 20, 2009,
where the Supreme Court then stressed that as opposed to the abovementioned Genuino v.
National Labor Relations Commission, G.R. Nos. 142732-33 & 142753-54, December 4, 2007,
539 SCRA 342 the social justice principles of labor law outweigh or render inapplicable the civil
law doctrine of unjust enrichment.
NOTE: The foregoing answer can be found in pages 636-638 of the book entitled Principles and
Cases Labor Relations, First Edition 2016, by Atty. Voltaire T. Duano. The topic on refund
doctrine was asked for the first time for this year’s bar examinations.
B.
Gene is a married regular employee of Matibay Corporation. The employee and Matibay
Corporation had an existing CBA that provided for funeral or bereavement aid of P15,000.00 in
case of the death of a legal dependent of a regular employee. His widowed mother, who had
been living with him and his family for many years, died; hence, he claimed the funeral aid.
Matibay Corporation denied the claim on the basis that she had not been his legal dependents as
the term legal dependent was defined by the Social Security Law.
(a) Who may be the legal dependents of Gene under the Social Security Law? (2.5%)
SUGGESTED ANSWER:
Section 8 (e) of the Social Security Law provides that the dependents shall be the following:
(1) The legal spouse entitled by law to receive support from the member;
(2) The legitimate, legitimated or legally adopted, and illegitimate child who is unmarried, not
gainfully employed, and has not reached twenty-one (21) years of age, or if over twenty-one (21)
years of age, he is congenitally or while still a minor has been permanently incapacitated and
incapable of self-support, physically or mentally; and
(3) The parent who is receiving regular support from the member.
NOTE: The foregoing answer can be found in page 862 of the book entitled Principles and Cases
Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano. The topic
on dependents has been time and again the subject matter of bar questions, more specifically
during the 2014 and 2002 Bar Examinations.
(b) Is Gene entitled to the funeral aid for the death of his widowed mother? Explain your answer.
(2%)
SUGGESTED ANSWER:
Gene is entitled to the funeral aid for the death of his widowed mother under CBA. This is
because the said CBA clearly provided for funeral or bereavement aid of P15,000.00 in case of
the death of a legal dependent of a regular employee. But in so far as the SSS law is concerned,
the only way that Gene can recover is that if he will qualify as the primary beneficiary of his
widowed mother provided he has the restrictions on the definition of dependent children.
NOTE: The foregoing answer can be found in pages 862-864 of the book entitled Principles and
Cases Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano in
so far as the definition of beneficiary in relation to dependents are concerned.
C.
Rosa was granted vacation leave by her employer to spend three weeks in Africa with her family.
Prior to her departure, the General Manager of the company requested her to visit the plant of
the company in Zimbabwe in order to derive best manufacturing practices useful to the company.
She accepted the request because the errand would be important to the company and Zimbabwe
was anyway in her itinerary. It appears that she contracted a serious disease during the trip.
Upon her return, she filed a claim for compensation, insisting that she had contracted the disease
while serving the interest of her employer.
Under the Labor Code, the sickness or death of an employee, to be compensable, must have
resulted from an illness either definitely, accepted as an occupational disease by the Employee’s
Compensation Commission, or caused by employment subject to proof that the risk of
contracting the same is increased by working conditions.
Is the serious disease Rosa contracted during her trip to Africa compensable? Explain your
answer. (2.5%)
SUGGESTED ANSWER:
In Government Service Insurance System vs. Besitan, G.R. No. 178901, November 23, 2011,
explained the concept of increased theory as follows:
Corollarily, for the sickness or resulting disability or death to be compensable, the claimant must
prove either (1) that the employee’s sickness was the result of an occupational disease listed
under Annex “A” of the Amended Rules on Employees’ Compensation, or (2) that the risk of
contracting the disease was increased by his working conditions.
Certainty is not required only probability
Under the increased risk theory, there must be a reasonable proof that the employee’s working
condition increased his risk of contracting the disease, or that there is a connection between his
work and the cause of the disease. (Castor-Garupa v. Employees’ Compensation Commission,
G.R. No. 158268, April 12, 2006, 487 SCRA 171, 180) Only a reasonable proof of work-
connection, not direct causal relation, however, is required to establish compensability of a non-
occupational disease. (Government Service Insurance System v. Cordero, G.R. Nos. 171378 &
171388, March 17, 2009, 581 SCRA 633, 640) Probability, and not certainty, is the yardstick in
compensation proceedings; thus, any doubt should be interpreted in favor of the employees for
whom social legislations, like PD No. 626, were enacted. (Government Service Insurance
System v. Corrales, G.R. No. 166261, June 27, 2008, 556 SCRA 230, 243-244)
Applying the above ruling, Rosa must present a reasonable proof that her working condition
increased his risk of contracting the disease, or that there is a connection between his work and
the cause of the disease otherwise the same is not compensable.
NOTE: The foregoing answer can be found in page 766 of the book entitled Principles and Cases
Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano. The topic
on compensation proceedings has been time and again the subject matter of bar questions,
more specifically during the 2012, 2005 and 1996 Bar Examinations.
.
XIII
A.
Given that the liability for an illegal strike is individual, not collective, state when the participating
union officers and members may be terminated from employment because of the illegal strike.
Explain your answer. (4%)
SUGGESTED ANSWER:
The following are the effects of participation in an illegal strike and commission of illegal acts
during strike:
1. Any union officer who knowingly participates in an illegal strike; and
2. Any worker or union officer who knowingly participates in the commission of illegal acts during
a strike may be declared to have lost his employment status; (Third paragraph, Article 279 (a)
[264 (a)], Labor Code)
NOTE: The foregoing answer can be found in page 520 of the book entitled Principles and Cases
Labor Relations, First Edition 2016, by Atty. Voltaire T. Duano. The topic on the effects of
participation in illegal strike has been time and again the subject matter of bar questions, more
specifically during the 2015, 2014, 2012, 2010, 2008, 2007, 2006, 1997, 1995 and 1994 Bar
Examinations.
B.
A sympathetic strike is stoppage of work to make common cause with other strikers in another
establishment or business. Is the sympathetic strike valid? Explain your answer. (1%)
SUGGESTED ANSWER:
The illegal stoppage of work by way of sympathetic strike has been settled in the case of Biflex
Phils. Labor Union (NAFLU) v. Filflex Industrial and Manufacturing Cororation, G.R. No. 155679,
19 December 2006, where it was ruled that stoppage of work due to welga ng bayan is in the
nature of a general strike, an extended sympathy strike. It affects numerous employers including
those who do not have a dispute with their employees regarding their terms and conditions of
employment.Employees who have no labor dispute with their employer but who, on a day they
are scheduled to work, refuse to work and instead join a welga ng bayan commit an illegal work
stoppage. Even if petitioners joining the welga ng bayan were considered merely as an exercise
of their freedom of expression, freedom of assembly or freedom to petition the government for
redress of grievances, the exercise of such rights is not absolute. For the protection of other
significant state interests such as the right of enterprises to reasonable returns on investments,
and to expansion and growth enshrined in the 1987 Constitution must also be considered,
otherwise, oppression or self-destruction of capital in order to promote the interests of labor
would be sanctioned. And it would give imprimatur to workers joining demonstrations/rallies even
before affording the employer an opportunity to make the necessary arrangements to counteract
the implications of the work stoppage on the business, and ignore the novel principle of shared
responsibility between workers and employers aimed at fostering industrial peace. There being
no showing that petitioners notified respondents of their intention, or that they were allowed by
respondents, to join the welga ng bayan on October 24, 1990, their work stoppage is beyond
legal protection.
NOTE: The foregoing answer can be found in page 506 of the book entitled Principles and Cases
Labor Relations, First Edition 2016, by Atty. Voltaire T. Duano. The topic on sympathetic strike
has been the subject matter of bar questions during the 2004 Bar Examinations.
C.
Due to business recession, Ballistic Company retrenched a part of its workforce. Opposing the
retrenchment, some of the affected employees staged a strike. Eventually, the retrenchment was
found to be justified, and the strike was declared illegal; hence, the leaders of the strike, including
the retrenched employees, were declared to have lost their employment status.
Are the striking retrenched employees still entitled to separation pay under Sec. 298 (283) of the
Labor Code despite the illegality of their strike? Explain your answer. (2%)
SUGGESTED ANSWER:
The strikers including the union officers should be paid their separation pay by virtue of
retrenchment notwithstanding the illegal strike was declared illegal. The issue on entitlement to
separation pay due to authorized cause and the ground for termination due to knowingly
participating in illegal strike are distinct and different.
XIV
Pursuant to his power under Sec. 278(g) (263(g)) of the Labor Code, the Secretary of Labor
assumed jurisdiction over the 3-day old strike in Armor Steel Plates, Inc., one of the country’s
bigger manufacturers of steel plates, and ordered all the striking employees to return to work.
The striking employees ignored the order to return to work.
(a) What conditions may justify the Secretary of Labor to assume jurisdiction? (2.5%)
SUGGESTED ANSWER:
Pursuant to Article 263 (g) [now 278 (g)], when a labor dispute causes or is likely to cause a
strike or lockout in an industry indispensable to the national interest, the Secretary of Labor and
Employment may assume jurisdiction over the dispute and decide it or certify the same to the
National Labor Relations Commission (NLRC) for compulsory arbitration. (Section 1, Operational
Guidelines of Department Order No. 40-G-03, Series of 2010, dated February 24, 2011)
For a valid exercise of the assumption of jurisdiction authority, any of the following conditions
must be present:
a. Both parties have requested the Secretary of Labor and Employment to assume jurisdiction
over the labor dispute; or
b. After a conference called by the Office of the Secretary of Labor and Employment on the
propriety of the issuance of the Assumption or Certification Order, motu proprio or upon a
request or petition by either party to the labor dispute. In the said conference. the parties shall
also be encouraged to amicably settle the dispute. (Section 2, Operational Guidelines of
Department Order No. 40-G-03, Series of 2010, dated February 24, 2011)
NOTE: The foregoing answer can be found in pages 468-487 of the book entitled Principles and
Cases Labor Relations, First Edition 2016, by Atty. Voltaire T. Duano. The topic on the
assumption of jurisdiction has been time and again the subject matter of bar questions, more
specifically during the 2012, 2004 and 1996 Bar Examinations.
(b) What are the consequences of the assumption of jurisdiction by the Secretary of Labor, and
of the disobedience to the return to work? Explain your answer. (2.5%)
The consequences of assumption of jurisdiction are as follows:
a. If a strike or lockout has not taken place, the parties are enjoined to conduct any untoward
action that may lead to a strike or lockout.
b. if a strike or lockout has already taken place, all striking and locked out workers shall, within
twenty-four (24) hours from receipt of an Assumption or Certification Order, immediately return to
work and the employer shall immediately resume operations and readmit all workers under the
same terms and conditions prevailing before the strike.
c. At any point in time, the parties are not prevented from submitting the dispute to Voluntary
Arbitration with the Secretary of Labor and Employment or his/her duly authorized representative
as Voluntary Arbitrator or Panel of Voluntary Arbitrators. (Section 3, Operational Guidelines of
Department Order No. 40-G-03, Series of 2010, dated February 24, 2011)
While the consequence of disobedience to the return to work has been ruled in the case of
Manila Hotel Employees Association v. Manila Hotel Corporation, G.R. No. 154591, March 5,
2007. In holding that defiance of the assumption order or a return-to work order by a striking
employee, whether a union officer or a member, is an illegal act and, therefore, a valid ground for
loss of employment status. The High Court explained:
The law explicitly prohibits such acts.
ART. 263. STRIKES, PICKETING, AND LOCKOUTS
x x x x (omitted)
ART. 264. PROHIBITED ACTIVITIES
(a) x x x x
(omitted)

More to the point, the Court has consistently ruled in a long line of cases spanning several
decades that once the SOLE assumes jurisdiction over a labor dispute, such jurisdiction should
not be interfered with by the application of the coercive processes of a strike or lockout. Defiance
of the assumption order or a return-to work order by a striking employee, whether a union officer
or a member, is an illegal act and, therefore, a valid ground for loss of employment status.
(Grand Boulevard Hotel v. Genuine Labor Organization of Workers in Hotel, Restaurant and
Allied Industries (GLOWHRAIN), G.R. No. 153664, 18 July 2003, 406 SCRA 688, 710;
Telefunken Semiconductors Employees Union-FFW v. Court of Appeals, G.R. Nos. 143013-14,
18 December 2000, 348 SCRA 565, 582; Federation of Free Workers v. Inciong, G.R. No.
49983, 20 April 1982, 208 SCRA 157, 165)
NOTE: The foregoing answer can be found in page 501 of the book entitled Principles and Cases
Labor Relations, First Edition 2016, by Atty. Voltaire T. Duano. The topic on the assumption of
jurisdiction has been time and again the subject matter of bar questions, more specifically during
the 2012, 2004 and 1996 Bar Examinations.