Labor Law Green Notes 2015

Green Notes 2015

Labor Law

Compiled by: The Barristers’ Club 2015

Labor Law and Social Legislation I. Fundamental Principles and Policies

A. Constitutional Provisions What are the constitutional mandates with regard labor laws?

Secs. 9, 10, 11, 13, 14, 18, 20, Art. II 1. Sec. 9, Art. II – 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. 2. Sec. 10, Art. II –The State shall promote social justice in all phases of national development. 3. Sec. 11, Art. II –The State values the dignity of every human person and guarantees full respect for human rights. 4. Sec. 13, Art. II – The State recognizes the vital role of the youth in nation-building and shall promote and protect their physical, moral, spiritual, intellectual, and social well-being. It shall inculcate in the youth patriotism and nationalism, and encourage their involvement in public and civic affairs. 5. Sec. 14, Art. II – The State recognizes the role of women in nation-building, and shall ensure the fundamental equality before the law of women and men. 6. Sec. 18, Art. II – The State affirms labor as a primary social economic force. It shall protect the rights of workers and promote their welfare. 7. Sec. 20, Art. II – The State recognizes the indispensable role of the private sector, encourages private enterprise, and provides incentives to needed investments.

Secs. 1, 4, 7, 8, 10, 16, 18(2), Art. III 8. Sec. 1, Art. III – No person shall be deprived of life, liberty, or property without due process of law, nor shall any person be denied the equal protection of the laws.

―An erring seaman is given a written notice of the charge against him and is afforded an opportunity to explain or defend himself. Xxx‖ (Sec. 17, POEA-SEC; Skippers Pacific, Inc. v. Mira; Maersk-Filipinas Crewing, Inc. vs. Avestruz, G.R. No. 207010, February 18, 2015). 9. Sec. 4, Art. III – No law shall be passed abridging the freedom of speech, of expression, or of the press, or the right of the people peaceably to assemble and petition the government for redress of grievances. 10. Sec. 7, Art III – The right of the people to information on matters of public concern shall be recognized. Access to official records, and to documents, and papers pertaining to official acts, transactions, or decisions, as well as to government research data used as basis for policy development shall be afforded the citizen, subject to such limitations as may be provided by law. 11. Sec. 8, Art. III – 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. 12. Sec 10, Art. III – No law impairing the obligation of contracts shall be passed. 13. Sec. 16, Art. III – All persons shall have the right to a speedy disposition of their cases before all judicial, quasi-judicial, or administrative bodies. 14. Sec. 18 (2), Art. III – No involuntary servitude in any form shall exist except as a punishment for a crime whereof the party shall have been duly convicted.

Secs. 1, 2, 3, 13, 14, Art. XII 15. Sec. 1, Art. XIII – The Congress shall give highest priority to the enactment of measures that protect and enhance the right of all the people to human dignity, reduce social, economic, and political inequalities, and remove cultural inequities by equitably diffusing wealth and political power for the common good. To this end, the State shall regulate the acquisition, ownership, use, and disposition of property and its increments.

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Compiled by: The Barristers’ Club 2015 16. Sec. 2, Art. XIII – The promotion of social justice shall include the commitment to create economic opportunities based on freedom of initiative and self--reliance. 17. Sec. 3, Art. XIII – The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all. It shall guarantee the rights of all workers to self–organization, collective bargaining and negotiations, and peaceful concerted activities, including the right to strike in accordance with law. They shall be entitled to security of tenure, humane conditions of work, and a living wage. They shall also participate in policy and decision–making processes affecting their rights and benefits as may be provided by law. The State shall promote the principle of shared responsibility between workers and employers and the preferential use of voluntary modes in settling disputes, including conciliation, and shall enforce their mutual compliance therewith to foster industrial peace. The State shall regulate the relations between workers and employers, recognizing the right of labor to its just share in the fruits of production and the right of enterprises to reasonable returns to investments, and to expansion and growth.

Consistent with the State‘s avowed policy to afford full protection to labor as enshrined in the Constitution, the POEA-SEC was designed primarily for the protection and benefit of Filipino seafarers in the pursuit of their employment on board ocean-going vessels. As such, it is a standing principle that its provisions are to be construed and applied fairly, reasonably, and liberally in their favor (Racelis vs. United Philippine Lines, Inc., G.R. No. 198408, November 12, 2014). 18. Sec. 13, Art XIII – The State shall establish a special agency for disabled persons for their rehabilitation, self-development and self-reliance, and their integration into the mainstream of society. 19. Sec. 14, Art. XIII – The State shall protect working women by providing safe and healthful working conditions, taking into account their maternal functions, and such

facilities and opportunities that will enhance their welfare and enable them to realize their full potential in the service of the nation.

B. What are the Civil Code provisions related laws to labor? 1. Art. 19 – Every person must in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith. 2. Art. 1700 – The relations between capital and labor are not merely contractual. They are so impressed with public interest that labor contracts must yield to the common good. Therefore, such contracts are subject to the special laws on labor unions, collective bargaining, strikes and lockouts, closed shop, wages, working conditions, hours of labor and similar subjects. 3. Art. 1701 –Neither capital nor labor shall act oppressively against the other, or impair the interest or convenience of the public.

The preferential treatment given by our law to labor, however, is not a license for abuse. It is not a signal to commit acts of unfairness that will unreasonably infringe on the property rights of the company. Both labor and employer have social utility, and the law is not so biased that it does not find a middle ground to give each their due (Milan, et al. vs. NLRC, G.R. No. 202961, February 4, 2015). 4. Art. 1702 – In case of doubt, all labor legislation and all labor contracts shall be construed in favor of the safety and decent living for the laborer. 5. Art. 1703 – No contract which practically amounts to involuntary servitude, under any guise whatsoever, shall be valid.

C. Labor Code 1. Art. 3. Declaration of Basic Policy. – The State shall afford full 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 selforganization, collective bargaining, security of

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Compiled by: The Barristers’ Club 2015 tenure, and just and humane conditions of work. 2. Art. 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.

It is a document issued by the DOLE authorizing a person or association to engage in recruitment and placement activities as a private recruitment entity. Who are the persons prohibited from engaging the business of recruiting migrant workers? 1. Unlawful for any official or employee of the: a. DOLE; b. POEA; c. Overseas Workers Welfare Administration (OWWA); d. DFA; and e. Other government agencies involved in the implementation of this Act

If doubts exist between the evidence presented by the employer and that of the employee, the scales of justice must be tilted in favor of the latter (Hocheng Philippines Corporation vs. Farrales, G.R. No. 211497, March18, 2015) 3. Art.166. Qualifications of Health Personnel. –The physicians, dentists and nurses employed by employers pursuant to this Chapter shall have the necessary training in industrial medicine and occupational safety and health.

The Secretary of Labor and Employment, in consultation with industrial, medical, and occupational safety and health associations, shall establish the qualifications, criteria and conditions of employment of such health personnel.

2. Their relatives within the 4th civil degree of consanguinity or affinity, to engage, directly or indirectly in the business of recruiting migrant workers. (Sec. 8, R.A. 8042) Who is a non-licensee / non-holder of authority? Any person, corporation or entity:

4. Art. 211. Record of Death or

1.

Disability

5. Art. 212. Notice of Sickness, Injury

or Death

6. Art. 255. Unfair Labor Practices of

2. Whose license or authority has been suspended, revoked or cancelled by the POEA or the SoLE

Labor Organizations

7. Art. 277. Applicability to Farm Tenants and Rural Workers II. Recruitment and Placement

A. Recruitment of Local and Migrant Workers 1. Illegal recruitment (Sec. 5, R.A. No. 10022)

Which has not been issued a valid license or authority to engage in recruitment and placement by the Secretary of Labor and Employment (SoLE); or

What are the grounds for revocation of license? 1. Incurring an accumulated 3 counts of suspension by an agency based on final and executory orders within the period of validity of its license;

a) License vs. authority

2. Violations of the conditions of

What is a license?

license;

It is issued by DOLE authorizing a person or entity to operate a private employment agency.

3. Engaging in acts of misrepresentation for the purpose of securing a license or renewal;

What is an Authority?

4. Engaging in the recruitment or placement of workers to jobs harmful to the

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Compiled by: The Barristers’ Club 2015 public health or morality or to the dignity of the country (Sec. 3, Rule I, Book VI, Rules and

Regulations Employment).

Governing

Overseas

b) Essential elements of illegal recruitment What are the elements of Illegal Recruitment? 1. Offender is a non--licensee or nonholder of authority to lawfully engage in the recruitment/placement of workers 2. Offender undertakes: a. Any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, and includes referrals, contact services, promising or advertising for employment, locally or abroad, whether for profit or not (Art. 13[b]);or under Art.34

b. Any of prohibited practices

c) Simple illegal recruitment It is considered simple illegal recruitment when it involves less than three (3) victims or recruiters.

d) Illegal recruitment in large scale It is committed against 3 or more persons individually or as a group.

e) Illegal recruitment as economic sabotage When is illegal recruitment considered as economic sabotage? When it is committed: 1. By a syndicate – carried out by 3 or more persons conspiring/confederating with one another or 2. In large scale – committed against 3 or more persons individually or as a group.

(Sec. 6, 10022)

f) Illegal recruitment vs. Estafa Illegal recruitment is a malum prohibitum, whereas estafa is malum in se, meaning the criminal intent is NOT necessary for conviction in the former, but it is necessary in the latter.

It is not required that it be shown that the recruiter wrongfully represented himself as a licensed recruiter. NOTE: It is enough that the victims were deceived as they relied on the misrepresentation and scheme that caused them to entrust their money in exchange of what they later discovered was a vain hope of obtaining employment abroad. Accused defrauded another by abuse of confidence, or by means of deceit. NOTE: It is essential that the false statement or fraudulent representation constitutes the very cause or the only motive which induces the complainant to part with the thing of value Illegal recruitment and estafa cases may be filed simultaneously or separately. The filing of charges for illegal recruitment does not bar the filing of estafa, and vice versa. Double jeopardy will not set. g) Liabilities What is the liability of the private employment agency and the principal or foreign-based employer? They are jointly and severally liable for any violation of the recruitment agreement and the contracts of employment. Note: This joint and solidary liability imposed by law against recruitment agencies and foreign employers is meant to assure the aggrieved worker of immediate and sufficient payment of what is due him. If the recruitment/placement agency is a juridical being, the corporate officers and directors and partners as the case may be, shall themselves be jointly and solidarily liable with the corporation or partnership for the claims and damages (Becmen Service Exporter and

Promotionv. Cuaresma, G.R. Nos. 182978-79, April 7, 2009). What is the theory of imputed knowledge? A rule in insurance law that any information material to the transaction, either possessed by the agent at the time of the transaction or acquired by him before its

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Compiled by: The Barristers’ Club 2015 completion, is deemed to be the knowledge of the principal, at least so far as the transaction is concerned, even though in fact the knowledge is not communicated to the principal at all.

3. To ensure full regulation of employment in order to avoid exploitation.

(Leonor v. Filipinas Compania, 48 OG 243)

B. Regulation and Enforcement

h) Pre-termination of contract of migrant worker

1. Suspension or cancellation of license or authority (Art. 35, Labor Code)

What are the effects of termination of overseas employment without just, valid or authorized cause?

What are the grounds for suspension or cancellation of license?

The worker shall be entitled to the full reimbursement if his placement fee and the deductions made with interest at twelve percent (12%) per annum, plus his salaries for the unexpired portion of his employment contract or for three (3) months for every year of the unexpired term, whichever is less (Sec. 7, RA 10022)

1. Prohibited acts under Art. 34; 2. Publishing job announcements w/o POEA‘s approval; 3. Charging a fee which may be in excess of the authorized amount before a worker is employed; 4. Deploying workers w/o processing through POEA; and 5. Recruitment in places outside its authorized area (Sec. 4, Rule II, Book

2. Direct hiring

IV, POEA Rules).

What is Direct-hiring? It is when an employer hires a Filipino worker for overseas employment without going through the POEA or entities authorized by the Secretary of Labor.

2. Regulatory and visitorial powers of the DOLE secretary What are the regulatory powers of the Secretary of Labor and Employment (SOLE)?

What is the ban on direct-hiring?

1.

General Rule: An employer may only hire Filipino worker for overseas employment through POEA or entities authorized by DOLE.

2.

Exception: Direct hiring by: 1. International organizations; 2. Name hires; 3. Members of the diplomatic organizations; and 4. Other Employers as may be allowed by DOLE. Why is direct-hiring prohibited? 1.

To ensure the and conditions the worker; 2. To assure the hires only workers; and

best possible terms of employment for foreign Er that he qualified Filipino

Restrict and regulate the recruitment and placement activities of all agencies; and Issue orders and promulgate rules and Regulations.

What constitute visitorial power? 1.

Access to employer‘s records and premises at any time of the day or night, whenever work is being undertaken; 2. To copy from said records; and 3. Question any employee and investigate any fact, condition or matter which may be necessary to determine violations or which may aid in the enforcement of the Labor Code and of any labor law, wage order, or rules and regulation issued pursuant thereto. Give 4 instances where the visitorial power of the SLE may be exercised under the Labor Code.

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Compiled by: The Barristers’ Club 2015 Power to: Inspect books of accounts and records of any person or entity engaged in recruitment and placement; require it to submit reports regularly on prescribed forms and act in violations of any provisions of the LC on recruitment and placement. (Art. 37) 2. Have access to employer‘s records and premises to determine violations of any provisions of the LC on recruitment and placement. (Art. 128) 3. Conduct industrial safety inspections of establishments. (Art. 165) 4. Inquire into the financial activities of legitimate labor organizations (LLO) and examine their books of accounts upon the filing of the complaint under oath and duly supported by the written consent of at least 20% of the total membership of the LO concerned.

3. Filipino servicemen working in U.S. military installations

(Resolution No. 1-83, InterAgency Committee for Implementation of E.O. 857).

1.

Can SOLE issue search warrants or warrants of arrest? No. Only a judge may issue search and arrest warrants. Art 38 (c) of the Labor Code is unconstitutional inasmuch as it gives the SLE the power to issue search or arrest warrants. The labor authorities must go through the judicial process.

3. Remittance of foreign exchange earnings What is the rule on remittance of foreign exchange earnings? General Rule: It shall be mandatory for all OFWs to remit a portion of their foreign exchange earnings to their families, dependents, and/or beneficiaries ranging from 50%-80% depending on the worker‘s kind of job. (Rule VIII, Book III, POEA Rules) Exceptions: 1. The worker‘s immediate family members, beneficiaries and dependents are residing with him abroad; 2. Immigrants and Filipino professionals and employees working with the UN agencies or specialized bodies; and

What is the effect of failure to remit? 1.

Workers – Shall be suspended or

removed from the list of eligible workers for overseas employment; and 2. Employers – Will be excluded from the overseas employment program. Private employment agencies shall face cancellation or revocation of their licenses or authority to recruit. (Sec. 9,

E.O. 857

4. Prohibited activities What are prohibited practices in recruitment/placement? (Art. 34.) 1. Furnishing or publishing any false notice/information/document related to recruitment/employment; 2. Failure to file reports required by SoLE; 3. Inducing or attempting to induce a worker already employed to quit his employment in order to offer him another unless the transfer is designed to liberate a worker from oppressive terms and conditions; 4. Recruitment/placement of workers in jobs harmful to public health or morality or to the dignity of the country; 5. Engaging directly or indirectly in the management of a travel agency; 6. Substituting or altering employment contracts without approval of DOLE; 7. Charging or accepting any amount greater than that specified by DOLE or make a worker pay any amount greater than actually received by him; 8. Committing any act of misrepresentation to secure a license or authority; 9. Influencing or attempting to influence any person/entity not to employ any worker who has not applied of employment through his agency; 10. Obstructing or attempting to obstruct inspection by SoLE or by his representatives; 11. Withholding or denying travel documents from applicant workers before departure for monetary

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Compiled by: The Barristers’ Club 2015

12. 13.

14.

15.

16.

considerations other than authorized by law; Granting a loan to an OFW which will be used for payment of legal and allowable placement fees; Refusing to condone or renegotiate a loan incurred by an OFW after his employment contract has been prematurely terminated through no fault of his or her own; For a suspended recruitment/manning agency to engage in any kind of recruitment activity including the processing of pending workers' applications; and For a recruitment/manning agency or a foreign principal/ Er to pass on the OFW or deduct from his or her salary the payment of the cost of insurance fees, premium or other insurance related charges, as provided under the compulsory worker's insurance coverage Imposing a compulsory and exclusive arrangement whereby an OFW is required to: a. Avail a loan only from specifically designated institutions, entities or persons; b. To undergo health examinations only from specifically designated medical, entities or persons, except seafarers whose medical examination cost is shouldered by the shipowner; and c. To undergo training of any kind only from designated institutions, entities or persons, except for recommendatory trainings mandated by principals/shipowners (Sec. 6, R.A.

10022).

What is the limitation on the employer‘s power to regulate working conditions? It must be done in good faith and not for the purpose of defeating or circumventing the rights of the employees. Such are not always absolute and must be exercised with due regard to the rights of labor. Note: One‘s employment, profession, trade or calling is a property right and the wrongful interference therewith is an actionable wrong. When does the condition on employment under the Labor Code apply? Only if an Employer-Employee relationship exists. Who are the employees that are covered by the conditions of employment? General Rule: It applies to all Ee‘s in all establishments. Exceptions: 1. Gov‘t employees; 2. Managerial employees; 3. Field personnel; 4. The employer‘s family members who depend on him for support; 5. Domestic helpers and persons in the personal service of another; and 6. Workers who are paid by results as determined under DOLE regulations. Who are government employees? They are Employees of the: 1. National Government; 2. Any of its political subdivisions; and 3. Including those employed in GOCCs with

original charters.

III. Labor Standards A. Hours of work

Who are managerial employees?

1. Coverage/Exclusions (Art. 82, Labor Code)

Those whose primary duty consists of the management of the establishment in which they are employed or a department or subdivision thereof, and other officers or members of the managerial staff.

Who determines working conditions? Generally, they are determined by the employer, as he is usually free to regulate, according to his discretion, all aspects of employment.

They must meet all of the following conditions, namely:

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Compiled by: The Barristers’ Club 2015 1.

2. 3.

4.

5.

6.

Primary duty: management of the establishment in which they are employed or of a department or subdivision thereof; Customarily or regularly direct the work of 2 or more employees; Has the authority to hire or fire other employees of lower rank; or their suggestions and recommendations as to the hiring and firing and as to the promotion or any change of status of other employees are given particular weight; Execute under general supervision work along specialized or technical lines requiring special training, experience, or knowledge; Execute under general supervision special assignment and tasks; and Do not devote more than 20% of their hours worked to activities which are not directly and closely related to performance of the work described.

(Art. 82[2])

They are: 1. non-agricultural employees; 2. who regularly perform their duties; 3. away from the principal place of business or branch office of the employer; and 4. whose actual hours of work in the field cannot be determined with reasonable certainty. Who are domestic helpers and persons in the personal service of another? Those who: 1. perform services in the employers (Er) home which are usually necessary or desirable for the maintenance or enjoyment thereof; or 2. minister to the personal comfort, convenience or safety of the employers as well as the members of his employers household.

1.

2. Normal hours of work What are the normal hours of work of an employee? It should not exceed 8 hours in a general working day. Note: Normal hours of work may be shortened or compressed. a) Compressed work week

Who are field personnel?

What are the 3 groups (employees) under the LC?

suspend, lay-off, recall, discharge, assign or discipline employees; 2. Supervisory employees those who in the interest of the employers, effectively recommend such managerial actions if the exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment; and 3. Rank-and-File employers all employers not falling within any of the above definitions. (Art. 212[m])

of

employees

Managerial employees - One who is vested with the powers or prerogatives to lay down and execute management policies and/or to hire, transfer,

What is a compressed workweek? The normal workweek is reduced to less than 6 days but the total number of work hours of 48 hours per week shall remain. The normal workday is increased to more than 8 hours but not to exceed 12 hours, without corresponding overtime premium. The concept can be adjusted accordingly depending on the normal workweek of the company. (Department Advisory Order No. 2,

Series of 2009)

When is the implementation of a compressed work week valid? The validity of the reduction of working hours can be upheld when the arrangement is temporary, it is a more humane solution instead of a retrenchment of personnel, there is notice and consultations with the workers and supervisors, a consensus is reached on how to deal with deteriorating economic conditions and it is sufficiently proven that the company was suffering from losses. Under the Bureau of Working Conditions‘ bulletin, a reduction of the number of regular working days is valid where the arrangement is resorted to by the

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Compiled by: The Barristers’ Club 2015 employer to prevent serious losses due to causes beyond his control, such as when there is a substantial slump in the demand for his goods or services or when there is lack of raw materials. There is one main consideration in determining the validity of reduction of working hours – that the company was suffering from losses. A year of financial losses would not justify a reduced workweek.

(Linton Commercial v. Hellera, G.R. No. 163147, October 10, 2007)

Under what conditions may a "compressed work week" schedule be legally authorized as an exception to the "8-hour a day" requirement under the LC? 1. 2.

3.

4. 5.

There is no diminution in their weekly or monthly take home pay or fringe benefits; The benefits are more than or at least commensurate or equal to what is due the Employees without the compressed work week; OT pay will be due and demandable when they are required to work on those days which should have ceased to be working days because of the compressed work week schedule; No strenuous physical exertion or that they are given adequate rest periods; and It must be for a temporary duration as determined by the DOLE. (2005 Bar Question)

What are the requisites for adoption of compressed workweek? 1. The Employer shall notify the DOLE through the Regional Office which has jurisdiction over the workplace, of the adoption of compressed workweek. 2. The notice shall be in Report Form attached to the advisory. 3. The Regional Office shall conduct an ocular visit to validate whether the adoption of the flexible work arrangements is in accordance with this issuance. (Department Advisory Order

No. 2, Series of 2009)

3. Meal break What is the duration of the meal period? Every Employer shall give his Employees not less than 60 minutes or 1 hour time-off for regular meals. Is the meal period compensable? Being time-off, it is not compensable. Employee must be completely relieved from duty. When is the compensable?

meal

period

considered

1.

It is compensable where the lunch period or meal time: 2. Is predominantly spent for the employers benefit; or 3. Where it is less than 20 minutes Note: Where during meal period, the laborers are required to stand by for emergency work, or where the meal hour is not one of complete rest, such is considered OT. (Pan Am vs. Pan Am Employees Association, G.R. No. L-16275,

Feb. 23, 1961)

Rest periods or coffee breaks running from 5 to 20 minutes shall be considered as compensable working time. (Sec. 7, Rule I,

Book III, IRR)

Are meal periods provided during OT work compensable? Yes, since the 1 hour meal period (non-compensable) is not given during OT work because the latter is usually for a short period and to deduct from the same would reduce to nothing the Employees OT work. Thus, the 1 hour break for meals during OT should be treated as compensable. What are the instances where meal periods shortened to not less than 20 minutes is compensable or not compensable? 1.

Compensable – At the instance of Employer, when:

a. Work is non-manual in nature or does not involve strenuous physical exertion; b. Establishment regularly operates less than 16 hours a day;

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Compiled by: The Barristers’ Club 2015 c. Work is necessary to prevent serious loss of perishable goods; and d. Actual or impending emergency or there is urgent work to be performed on machineries and equipment to avoid serious loss which the Employer would otherwise suffer. (Sec. 7, Rule I, Book III,

IRR)

2. Not Compensable – Employee requested for the shorter meal time so that he can leave work earlier than the previously established schedule. Requisites: a. Employees voluntarily agree in writing and are willing to waive OT pay for the shortened meal period; b. No diminution in the salary and other fringe benefits of the Employees which are existing before the effectivity of the shortened meal period; c. Work of the Employees does not involve strenuous physical exertion and they are provided with adequate coffee breaks in the morning and afternoon; d. Value of the benefits derived by the Employees from the proposed work arrangements is equal to or commensurate with the compensation due them for the shortened meal period as well as the OT pay for 30 minutes as determined by the Employees concerned; e. OT pay will become due and demandable after the new time schedule; and f. Arrangement is of temporary duration.

4. Waiting time When is an Employee considered working while on call? When Employee is required to remain on call in the Employers premises or so close thereto that he cannot use the time effectively and gainfully for his own purpose.

b. The employee is required or engaged by the employer to wait (engaged to

wait)

Note: The controlling factor is whether waiting time spent in idleness is so spent predominantly for the employer‘s benefit or for the employee. When is waiting time not considered working time? When the employee is waiting to be engaged: idle time is not working time; it is not compensable. When is travel time considered working time? 1. Travel from home to work General Rule: Normal travel from home to work is not working time. Exceptions: a. Emergency call outside his regular working hours where he is required to travel to his regular place of business or some other work site; b. Done through a conveyance provided by the employer; c. Done under the supervision and control of the employer; d. Done under vexing and dangerous circumstance. 2. Travel that is all in a day‘s work – time spent in travel as part of the employees principal activity 3. Travel away from home General Rule:

When idle time is considered working time? When the employee is idle or inactive by reason of interruptions beyond his control shall be considered working time. When is waiting time considered working time?

a. Travel that requires an overnight stay on the part of the employee when it cuts across the employee‘s workday is clearly working time; b. The time is not only hours worked on regular workdays but also during corresponding working hours on nonworking days. Outside of these regular working hours, travel away from home is not considered working time.

a. If waiting is an integral part of his work, or

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Compiled by: The Barristers’ Club 2015 Exception: During meal period or when employee is permitted to sleep in adequate facilities furnished by the employer. What are the conditions in order for lectures, meetings and training programs to be not considered as working time?

what cannot be accomplished during the normal hours of work. Distinguish Overtime pay from premium pay.

Overtime

pay

All of the ff. conditions must be present: 1. Attendance is outside of the employers regular working hours; 2. Attendance is in fact voluntary; and 3. The employee does not perform any productive work during such attendance.

is the additional compensation for work performed beyond 8 hours on ordinary days (within the worker‘s 24-hour workday). On the other hand, premium pay is the additional compensation for work performed within 8 hours on days when normally he should not be working (on non-working days, such as rest days and special days.) But additional compensation for work rendered in excess of 8 hours during these days is also considered OT pay.

5. Overtime work, overtime pay

Overtime Pay Rates:

What is overtime work (OT)?

OT during a regular working day

Work performed beyond 8 hours within the worker‘s 24 hour workday.

Additional compensation of 25% of the regular wage.

Note: Express instruction from the employer to the employee to render OT work is not required for the employee to be entitled to OT pay; it is sufficient that the employee is permitted or suffered to work. However, written authority after office hours during rest days and holidays are required for entitlement to compensation.

OT during a holiday or rest day

What is a work day?

If done on a special holiday AND rest day:

The 24-hour period which commences from the time the employee regularly starts to work. Note: Minimum normal working hours fixed by law need not be continuous to constitute the legal working day. What is the rationale behind OT pay? Employee is made to work longer than what is commensurate with his agreed compensation for the statutory fixed or voluntarily agreed hours of labor he is supposed to do. (PNB vs. PEMA and CIR, G.R.

Rate of the first 8 hours worked on plus at least 30% of the regular wage (RW) If done on a special holiday OR rest day: 30% of 130% of RW

30% of 150% of RW if done on a regular holiday: 30% of 200% of RW May an employee be compelled to render OT work? General Rule: No. OT work is voluntary. Exception: Compulsory OT work in any of the following situations:

No. L-30279, July 30, 1982)

Discourages the employer from requiring such work thus protecting the health and well-being of the worker, and also tend to remedy unemployment by encouraging employers to employ others workers to do

1.

Urgent work to be performed on machines and installations in order to avoid serious loss or damage to the employer or some other cause of similar nature; 2. Work is necessary to prevent loss or damage to perishable goods;

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Compiled by: The Barristers’ Club 2015 3. In case of imminent danger to the public safety due to an actual or impending emergency in the locality caused by serious accidents, fire, flood, typhoon, earthquake, epidemic or other disaster or calamity; 4. Country is at war; 5. Completion or continuation of the work started before the 8th hour is necessary to prevent serious obstruction or prejudice to the business operations of the employer; 6. Any other national or local emergency has been declared; and 7. Necessary to prevent loss of life or property.

d. Imminent danger to public safety. 2. Urgent work a. To be performed on machineries, equipment or installations; and b. To avoid serious loss which the employer would otherwise suffer. 3. Work is necessary to prevent serious loss to perishable goods 4. Woman Employees a. Holds a responsible position of managerial or technical nature; or b. Has been engaged to provide health and welfare services

Note: There should be payment of additional compensation. employees refusal to obey the order of the employer constitutes insubordination for which he may be subjected to disciplinary action.

5. Nature of the work a. Requires the manual skill and dexterity of women workers; and b. The same cannot be performed with equal efficiency by male workers

6. Night work (R.A. No. 10151), Night shift differential

6. Women Employees are immediate members of the establishment or undertaking

What is night work?

7. In analogous cases exempted by the SLE in appropriate regulations (Art.

Any and all work rendered between 6:00 pm and 6:00 am. (National Rice & Corn

131)

Corp. v. NARIC, 105 Phil 891)

What is night work prohibition with regard to women workers? General Rule: No woman regardless of age shall be employed or permitted to work, with or without compensation in any: 1. Industrial undertaking or branch thereof between 10pm and 6am of the following day; 2. Commercial or non-industrial undertaking or branch thereof, other than agricultural, between midnight and 6am of the following day; and 3. Agricultural undertaking at night time unless she is given period of rest not less than 9 consecutive hours. Exceptions: 1. Actual or impending emergencies a. Caused by serious accident, fire, flood, typhoon, earthquake, epidemic, other disasters, or calamity; b. To prevent loss of life or property; or c. In case of force majeure; or

Note: The operation of Call Contract Centers which provides offshore case solutions to US based clients who phone in to conduct product inquiries and technical support, operating for 24/7, has been exempted from the prohibition considering the inevitable time difference between the US and the Phils. and the peak time for its operation is between 8:00 pm to 10:00 am Manila time, thereby making it necessary for 80% of its employees, including women, to work during graveyard shift. (BWC-WHSD Opinion No. 491, s. 2003) What is night shift differential (NSD)? It is additional compensation of not less than 10% of an employee‘s regular wage for every hour worked between 10:00 pm to 6:00 am, whether or not such period is part of the worker‘s regular shift. Who are entitled to NSD? General Rule: NSD applies to all employees

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Labor Law

Compiled by: The Barristers’ Club 2015 Exceptions: 1. Employees of the Governmentt and any of its political subdivisions, including GOCC‘s; 2. Retail and service establishments regularly employing not more than 5 workers; 3. Includes task and contract basis; 4. Domestic helpers and persons in the personal service of another; 5. Field personnel and employees whose time and performance is unsupervised by the employer; and 6. Managerial employees.

7. Part-time work Hours of work of part-time workers a.

Payment of wage should be in proportion the remuneration or earnings, however designated, for work done; b. or to be done or for services rendered or to be rendered; c. It is capable of being expressed in terms of money, whether fixed or ascertained on a time, task, piece, or commission basis, or other method of calculating the same; d. It is payable by an employer to an employee under a written or unwritten contract of employment for work done or to be done, or for services rendered or to be rendered; and It includes the fair and reasonable value, as determined by the Secretary of Labor and Employment, of board, lodging, or other facilities customarily furnished by the employer to the employee. ―Fair and only to the hours worked.

8. Contract for piece work (see Civil Code) Article 1713 of the Civil Code defines a contract for a piece of work thus: ―By the contract for a piece of work the contractor binds himself to execute a piece of work for the employer, in consideration of a certain price or compensation. The contractor may either employ only his labor or skill, or also furnish the material.‖

B. Wages 1.

Attributes of Wage

It is reasonable value‖ shall not include any profit to the employer, or to any person affiliated with the employer. 2. ―Wage‖, ―salary‖ and ―pay‖; distinction – they are synonymous in meaning and usage. 3. Commission – may or may not be treated as part of wage depending on the circumstances. 4. Actual work is the basis of claim for wages (No work, no pay‖). 1. Wage vs. salary Wage Compensation for manual labor (skilled or unskilled) also known as ―blue collared workers‖, paid at stated times and measured by the day, week, month or season. Considerable pay for a lower and less responsible character of employment. General Rule: Not subject to execution Exception: Debts incurred for food, shelter, clothing and medical attendance

Salary Paid to ―white collared workers‖ and denotes higher degree of employment or a superior grade of services and implies a position in office. Out gesture of a larger and more important service.

Subject to execution.

2. Minimum wage defined, Minimum wage setting What are the standards or minimum wage setting?

criteria for

In the determination of such regional minimum wages, the Regional Board shall, among other relevant factors consider the following: 1. The demand for living wages; 2. Wage adjustment vis-a-vis the consumer price index; 3. The cost of living and changes or increases therein; 4. The needs of workers and their families;

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Labor Law

Compiled by: The Barristers’ Club 2015 5. The need to induce industries to invest in the countryside; 6. Improvements in standards of living; 7. The prevailing wage levels; 8. Fair return of the capital invested and capacity to pay of employers; 9. Effects on employment generation and family income; and 10. The equitable distribution of income and wealth along the imperatives of economic and social development. What is salary ceiling method? It is a method of minimum wage adjustment whereby the wage adjustment is applied to employees receiving a certain denominated ceiling. In other words, workers already being paid more than the existing minimum wage are also to be given a wage increase (ECOP v. NWCP, G.R. No. 96169,

Sep. 24,1991).

by a corporation (Philippine Duplicators v.

NLRC, GR No. 110068, February 15, 1995).

What commissions are not deemed part of salary? Profit-sharing or bonus type commissions may be excluded when determining the ―basic salary‖. An example of which is are commissions paid to or received by medical representatives or by rank-and-file employees as productivity bonus (Boie-Takeda

Chemicals, Inc. v. Dela Serna, GR No. 92174, December 10, 1993 and Philippine Fuji Xerox Corp. v. Trajano GR No. 102552, December 10, 1993). 5. Deductions from wages What is the rule in wage deductions? General Rule: It is strictly prohibited

What is a floor wage method? It involves the fixing of a determinate amount to be added to the prevailing statutory minimum wage rates. 3. Minimum wage of workers paid by results

Exceptions: 1. 2.

a) Workers paid by results Who are workers paid by results? They are: 1. paid based on the work completed; and 2. not on the time spent in working 3. including those who are paid on piecework, ―takay‖, ―pakiaw‖, or task basis if their output rates are in accordance with the standards prescribed.

3. 4. 5.

Deductions under Art. 113 for insurance premiums; Union dues in cases where the right of the worker or his union to check off has been recognized by the employer or authorized in writing by the individual worker concerned (Art. 113). Art. 241(o) provides that special assessments may be validly checked-off provided that there is an individual written authorization duly signed by every employee; Deductions for SSS, Medicare and Pagibig premiums; Taxes withheld pursuant to the Tax Code; Deductions under Art. 114 for loss or damage to tools, materials or equipments; Deductions made with the written authorization of the employee for payment to a third person. (Sec 13,

b) Apprentices c) Learners d) Persons with disability

6.

4. Commissions

7. Deductions as disciplinary measures for habitual tardiness (Opinion dated

Rule VIII, Book III of the IRR);

What commissions are deemed part of salary? Wages-or-sales percentage type should be included in the 13th month pay computation. An example of which is the sales commission earned by salesmen who make or close a sale of duplicating machines distributed

March 10, 1975 of the SLE);

8. Agency fees under Art. 248(e); 9. Deductions for value of meals and facilities freely agreed upon; 10. In case where the employee is indebted to the employer where such

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Compiled by: The Barristers’ Club 2015 indebtedness has become due and demandable (Art. 1706, Civil Code); 1. The employer is authorized to withhold wages for debts due. ―Debt‖ in this case refers to any obligation due from the employee to the employer. It includes any accountability that the employee may have to the employer. There is no reason to limit its scope to uniforms and equipment (Milan et al. vs. NLRC, G.R. No. 202961, February 4, 2015). 11. In court awards, wages may be subject of execution or attachment, but only for debts incurred for food, shelter, clothing, and medical attendance (Art.

1703, Civil Code); and 12. Salary deduction of a member of a legally established cooperative (R.A. 6938, Art. 59) 6. Non-diminution of benefits What is the concept of non-diminution (ND) of benefits? General Rule: Benefits being given to employees cannot be taken back or reduced unilaterally by the employer because the benefit has become part of the employment contract, whether written or unwritten.

necessary for the laborer‘s and his family‘s existence and subsistence Note: Does not include tools of trade or articles/services primarily for the benefit of the employer or necessary to the conduct of the employer‘s business Forms part of the wage Deductible from wage For the benefit of the worker and his family.

or special privileges or benefits given to or received by the laborers over and above their ordinary earnings or wages

(Atok Big Wedge Mining Co. v. Atok Big Wedge Mutual Benefit Assoc, G.R. No. L-7349, July 19, 1955).

Independent of wage Not wage deductible Granted for the convenience of the employer.

7. Wage Distortion / Rectification What is wage distortion?

Exception: To correct an error, otherwise, if the error is not corrected for a reasonable time, it ripens into a company policy and employees can demand it as a matter of right.

A situation where an increase in wage results in the elimination or severe contraction of intentional quantitative differences in wage or salary rates between and among the 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.

When is ND of benefits applicable?

What are the elements of Wage Distortion?

It is applicable if it is shown that the grant of benefit: 1.

Is based on an express policy of the law; or 2. Has ripened into practice over a long period of time and the practice is consistent and deliberate and is not due to an error in the construction/ application of a doubtful or difficult question of law. 7. Facilities vs. supplements

1.

An existing hierarchy of positions with corresponding salary rates; 2. A significant change or increase in the salary rate of a lower pay class without a corresponding increase in the salary rate of a higher one; 3. The elimination of the distinction between the 2 groups or classes; and 4. The WD exists in the same region of the country. (Alliance Trade Unions v.

NLRC, G.R. No. 140689, Feb. 17, 2004)

Distinction between Facilities and Supplements Facilities Items of

Supplements expenses Extra remuneration

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Compiled by: The Barristers’ Club 2015 C. Rest Periods

Exceptions: (UNA-A-PAW)

1. Weekly rest day

1.

What is the right to weekly rest day? Every employer shall give his employees a rest period of not less than 24 consecutive hours after every 6 consecutive normal work days. (Sec. 3, Rule III, Book III,

2.

IRR)

3.

What is the scope of weekly rest day? It shall apply to all employers whether operating for profit or not, including public utilities operated by private persons. (Sec. 1,

4.

Rule III, Book III, IRR)

5.

Who determines the weekly rest day?

6.

General Rule: Employer shall determine and schedule the weekly rest day of his employee. Exceptions: 1. CBA; 2. Rules and regulations as the SLE provides; and 3. Preference of employee based on religious grounds –employee shall make known his preference in writing at least 7 days before the desired effectivity of the initial rest day so preferred (Sec. 4(1), Rule III, Book III,

IRR)

Exception to exception no. 3: Employer may schedule the weekly rest day of his choice for at least 2 days in a month if preference of the employee will inevitably result in: a. serious prejudice to the operations of the undertaking; and b. the employer cannot normally be expected to resort to other remedial measures. (Sec. 4(2), Rule III, Book III,

IRR

7.

Urgent work to be performed on the machinery, equipment or installation, to avoid serious loss which the employer would otherwise suffer; Nature of work requires continuous operations for 7 days in a week or more and stoppage of the work may result in irreparable injury or loss to the employer; Abnormal pressure of work due to special circumstances, where the employer cannot be ordinarily expected to resort to other measures; Actual or impending emergencies (serious accident, fire, flood, typhoon, earthquake, etc.) Prevent loss or damage to perishable goods; Analogous or similar circumstances as determined by the SLE; and Work is necessary to avail of favorable weather or environmental conditions where performance or quality of work is dependent thereon.

D. Holiday pay / Premium pay What is premium pay? It is the additional compensation for work rendered by the employee on days when normally he should not be working such as special holidays and weekly rest days. Can the Employer and Employre agree on the rate of premium pay other than that provided by law? Yes. Nothing shall prevent the Er and his Ee or their representatives from entering into any agreement with terms more favorable to the Ees Provided: It shall not be used to diminish any benefit granted to the Ees under existing laws, agreements and voluntary Er practices. (Sec. 9, Rule III, Book III, IRR)

2. Emergency Rest Day Work

What is holiday pay?

Can an employee be compelled to work on his rest day?

It is a premium given to employees (Ees) pursuant to law even if he has not been suffered to work on a regular holiday. It is limited to the 11 regular holidays, also called legal holidays listed by law.

General Rule: No.

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Compiled by: The Barristers’ Club 2015 The employee (Ee) should not have been absent without pay on the working day preceeding the regular holiday.

Limited to those Not exclusive provided under Art. 94, LC

What are the classes of special day?

Who are entitled to Holiday Pay?

1. National Special Public Holiday

General Rule: All employees are entitled.

(Sec.1, Rule IV, Book III, IRR)

General Rule: Non working days Exception: President

Otherwise

declared

by

the

Exceptions: 1.

2. Local Special Public Holiday – Regular working day. (LOI 814 as amended by LOI 1087)

2.

What are regular holidays?

3.

They are compensable whether worked or unworked subject to certain conditions. They are also called legal holidays. The following are considered regular holidays (Presidential Proclamation No. 18).

4.

REGULAR HOLIDAYS New Year‘s Day Maundy Thursday Good Friday

7.

Eid‘l Fitr

Araw ng Kagitingan Labor Day Independence Day National Heroes Day Bonifacio Day Christmas Day Rizal Day

DATE January 1 April 2 April 3 Movable Date April 9 May 1 June 12 Aug. 31 (last Monday of August) Nov. 30 December 25 Dec. 30

Distinction between Regular and Special Holiday Regular holiday

Special holiday

If Unworked

Regular pay (subject to certain conditions for daily paid Ee‘s)

No Pay

If worked

2x regular (200%)

Other matters Set by law

pay

+ 30% premium pay of 100% regular wage Set by proclamation

5. 6.

8.

Gov‘t Ees and any of its political subdivisions, including GOCCs (with original charter); Retail and service establishments regularly employing less than 10 workers; Domestic helpers and persons in the personal service of another; Employee engaged on task or contract basis or purely commission basis; Members of the Family of the Er who are dependent on him for support; Managerial Ee and other member of the managerial staff; Field personnel and other Ee whose time and performance are unsupervised by the Er; and Ee paid fixed amount for performing work irrespective of the time consumed in the performance thereof.

(Sec. 1, Rule IV, Book III, IRR)

What are the rates of compensation for rest day, Sunday or holiday work? Instances

Work on a scheduled rest day Work has no regular workdays and rest days (If performed on Sundays and Holidays) Work on a Sunday (If Ee‘s scheduled rest day) Work performed on any Special Holiday

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Rates of additional Compensation + 30% Premium Pay (PP) of 100% regular wage (Sec. 7, Rule III,

Book III, IRR)

+ 30% PP of 100% RW

(Sec. 7, Rule III, Book III, IRR)

+ 30% PP of 100% RW

(Sec. 7, Rule III, Book III, IRR)

1st 8 hrs: + 30% PP of 100% RW

Excess of 8 hrs: + 30% of hourly rate on said date.

Green Notes 2015

Labor Law

Compiled by: The Barristers’ Club 2015

Work performed on a Special Holiday and same day is the scheduled rest day Work performed on a Special Working Holiday

(M.C. No. 10, Series of 2004) 1st 8 hrs: + 50% PP of

100% regular wage Excess of 8 hrs: + 30% of hourly rate on said date (M.C. No. 10, Series

of 2004).

Ee is only entitled to his basic rate. No PP is required. Reason: Work performed is considered work on ordinary working days. (Sec. 7, Rule III, Book III, IRR)

1.) Coverage, exclusions

E. Leaves

To whom does the title on wages apply?

1. Service Incentive Leave

General Rule: It applies to all employees Exception: 1. Farm tenancy or leasehold; 2. Household or domestic helpers, including family drivers and persons working in the personal service of another; 3. Home workers engaged in needlework or in any cottage industry duly registered in accordance with law; 4. Workers in duly registered cooperatives when so recommended by the Bureau of Cooperative Development and upon approval of the Secretary of Labor and Employment; and 5. Workers of a barangay micro business enterprise (R.A. 9178) 2. Teachers, piece workers, takay, seasonal workers, seafarers What are the HPs of certain employees? Employees

Rule

1. RH semestral school vacations

during

2. RH Christmas vacation

during

Private teachers (Faculty members of colleges and universities)

HP shall not be less than his average daily Ee paid by: earnings for the last 1. results or 7 2. output actual work days (Piece work preceding the RH. payment) Provided: HP shall not be less than the minimum wage rate. May not be paid the required HP during Seasonal Workers offseason where they are not at work. Workers having no Shall be entitled to regular work days HP Shall be entitled to Seafarers HP

- Not entitled to HP

What is service incentive leave? It is 5 days leave with pay for every employee who has rendered at least 1 yr of service. It is commutable to its money equivalent if not used or exhausted at the end of year. Who are entitled to SIL? General Rule: Applies to every Ee who has rendered at least 1 year of service. Exceptions: 1. Government Ees and any of its political subdivisions including GOCCs; 2. Those already enjoying the benefit; 3. Domestic helpers and persons in the personal services of another; 4. Those already enjoying vacation leave with pay of at least 5 days; 5. Managerial Ees; 6. Field personnel and other Ees whose performance is unsupervised by the Er; 7. Employed in establishments regularly employing less than 10 workers; 8. Exempt establishments; and 9. Engaged on task or contract basis, purely commission basis, or those who are paid in a fixed amount of performing work irrespective of the time consumed in the performance thereof. (Art. 95[b])

- Shall be paid HP

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Compiled by: The Barristers’ Club 2015 Are part-time workers entitled to the full benefit of the yearly 5 day SIL? Yes. Art. 95 of Labor Code speaks of the number of months in a year for entitlement to said benefit (Bureau of Working

Conditions Advisory Opinion Integrated Exporter‘s, Inc.).

to

Phil.

Are piece-rate workers entitled to the full benefit of the yearly 5 day SIL? It depends.

1. Yes. Provided:

a. They are working inside the premises of the employer; and b. Under the direct supervision of the Er.

2. No. Provided:

a. They are working outside the premises of the Er; b. Hours spent in the performance of work cannot be ascertained with reasonable

3. certainty; and a. They are not under the direct supervision of the Er Does it apply to Ees with salaries above minimum wage? No. The difference between the minimum wage and the actual salary received by the Ees cannot be deemed as their 13th month pay and SIL pay as such difference is not equivalent to or of the same import as the said benefits contemplated by law. (JPL

Marketing Promotions v. CA, G.R. No. 151966, July 8, 2005.) 2. Maternity Leave What is maternity leave benefit?

A covered female employee (Ee) is entitled to a daily maternity benefit equivalent to 100% of her present basic salary, allowances and other benefits or the cash equivalent of such benefits for 60 days or 78 days in case of caesarian delivery. What are the requirements in order that maternity benefits may be claimed?

1.

There is childbirth, abortion or miscarriage; and 2. She has paid at least 3 monthly contributions. What are the conditions? 1. The Ee shall have notified her employer (Er) of her pregnancy and the probable date of her childbirth which notice shall be transmitted to the SSS; 2. The payment shall be advanced by the Er in 2 equal installments within 30 days from the filing of the maternity leave application; 3. In case of caesarian delivery, the Ee shall be paid the daily maternity benefit for 78 days; 4. Payment of daily maternity benefits shall be a bar to the recovery of sickness benefits for the same compensable period of 60 days for the same childbirth, abortion, or miscarriage; 5. The maternity benefits provided under Section 14-A shall be paid only for the first four deliveries; 6. The SSS shall immediately reimburse the Er of 100% of the amount of maternity benefits advanced to the Ee by the Er upon receipt of satisfactory proof of such payment and legality thereof; and 7. If an Ee should give birth or suffer abortion or miscarriage without the required contributions having been remitted for her by her Er to the SSS, or without the latter having been previously notified by the Er of the time of the pregnancy, the Er shall pay to the SSS damages equivalent to the benefits which said Ee would otherwise have been entitled to, and the SSS shall in turn pay such amount to the Ee concerned. 3. Paternity Leave What is paternity leave? It refers to the benefits granted to a married male employee allowing him not to report for work for 7 days but continues to earn the compensation therefore, on the condition that his spouse has delivered a child or suffered a miscarriage for purposes of enabling him to effectively lend support to his

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Compiled by: The Barristers’ Club 2015 wife in her period of recovery and/or in the nursing of the newly-born child. What are the requirements in order to avail paternity leave?

3. Must have at least rendered service of one year to his or her employer; and 4. He or she must remain a solo parent

The male employee (Ee) applying for paternity leave shall:

Who are those referred to as solo parent entitled to parental leave?

1.

Notify his employer (Er) of the pregnancy of his legitimate spouse; and 2. The expected date of such delivery.

Any individual who falls under any of the following categories:

What are the conditions for entitlement to paternity leave? The male Ee is; 1. Ee of private or public sector; 2. Only for the first 4 deliveries of legitimate spouse with whom he is cohabiting; and 3. Notify his Er of the pregnancy of his legitimate spouse and the expected date of such delivery. Note: For purposes of this Act, delivery shall include childbirth or any miscarriage. 4. Parental Leave (R.A. No. 8972) What is parental leave? Leave benefits granted to a solo parent to enable him/her to perform parental duties and responsibilities -where physical presence is required. In addition to leave privileges under existing laws, parental leave of not more than 7 working days every year shall be granted to any solo parent Ee who has rendered service of at least 1 year. (Sec.8) What are the conditions for entitlement of parental leave? 1.

He or she must fall among those referred to as solo parent; 2. Must have the actual and physical custody of the child or children;

1. A woman who gives birth as a result of rape and other crimes against chastity even without a final conviction of the offender, provided, that the mother keeps and raises the child;

2. Parent left solo or alone with the responsibility of parenthood due to:

a. Death of spouse; b. Detention or service of sentence of spouse for a criminal conviction for at least 1 yr; c. Physical and/or mental incapacity of spouse d. Legal separation or de facto separation from spouse for at least 1 yr as long as he/she is entrusted with the custody of the children; e. Nullity or annulment of marriage as decreed by a court or by a church as long as he/she is entrusted with the custody of the children; and f. Abandonment of spouse for at least 1 yr;

3. Unmarried mother/father who has preferred to keep and rear his or her child/children instead of: a. having others care for them; or b. give them up to a welfare institution

4. Any other person who solely provides: a. parental care; and b. support to a child or children

5. Any family member who assumes the responsibility of head of family as a result of the: a. b. c. d.

death; abandonment; disappearance; or prolonged absence of the parents or solo parent.

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Compiled by: The Barristers’ Club 2015 Note: A change in the status or circumstance of the parent claiming benefits under this Act, such that he/she is no longer left alone with the responsibility of parenthood, shall terminate his/her eligibility for these benefits.

3. Ees paid purely on commission basis; and 4. Ees already receiving 13th month pay

(Sec.3)

Is 13th Month Pay legally demandable?

5. Leave for Victims of Violence against Women and Children (R.A. No. 9262)

Yes. It is a statutory obligation, granted to covered Ees, hence, demandable as a matter of right. (Sec 1, P.D. 851)

What is the leave for victims of violence against women or otherwise known as battered woman leave?

In what form is the 13th month pay paid or given?

A female employee who is a victim of violence (physical, sexual, or psychological) is entitled to a paid leave of 10 days in addition to other paid leaves. (R.A. 9262, Anti-VAWC Act)

It is given in the form of: 1. Christmas Bonus; 2. Midyear Bonus; 3. Profit Sharing Scheme; OR 4. Other Cash bonuses amounting to not less than 1/12 of its basic salary

F. Service Charge

Note: It must always be in the form of a legal tender

What are service charges (SC)? These are charges collected by hotels, restaurants and similar establishments and shall be distributed at the rate of:

H. Separation Pay

G. Thirteenth Month Pay

Separation pay, as generally understood, refers to the amount due to the employee who has been terminated from service for causes authorized by law (not due to employees fault or wrong-doing) such as installation of labor-saving devices, redundancy, retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking.

What is 13th month pay or its equivalent? Additional income based on wage required by P.D. 851 Requiring all Employers to pay their Employees a 13th month pay which is equivalent to 1/12 of the total basic salary earned by an employee (Ee) within a calendar year. Who are covered by P.D. 851? General Rule: All rank-and-file Ees regardless of the amount of basic salary that they receive in a month, if their employers (Er) are not otherwise exempted from paying the 13th month pay. Such Ees are entitled to the 13th month pay regardless of said designation of employment status, and irrespective of the method by which their wages are paid. Provided, that they have worked for at least 1 month, during a calendar year. (Revised

Guidelines on the Implementation of the 13 Month Pay Law)

What is Separation Pay?

Separation pay is intended to provide the employee with the wherewithal during the period he is looking for another employment. Five Instances when Separation Pay is due to Employee There are at least five instances in which an employee is entitled to payment of separation pay upon severance of employment:

th

Exceptions: 1. Government Ees; 2. Household helpers;

1.

When the termination of employment is due to causes authorized by law, such as installation of labor-saving devices, redundancy, retrenchment to prevent losses or the closing or cessation of operation of the

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Compiled by: The Barristers’ Club 2015 establishment or undertaking (Art. 283, LC); 2. When the severance of employment is cause by a disease, particularly when the employee is found to be suffering from any disease and whose continued employment is prohibited by law or is prejudicial to his health as well as the health of his co-employees (Art. 284, LC); 3. When the termination from service of the employee has been declared illegal, but his reinstatement to his former position is no longer feasible for some valid reason, e.g., when reinstatement is rendered impossible due to subsequent closure of business, or when the relationship between employer and employee has become strained (doctrine of strained

relations);

4. In case of pre-termination of employment contract in jobcontracting arrangement; and 5. In exceptional cases, where separation pay is awarded as a measure of social or compassionate justice. Here, payment of separation pay may be ordered by the court even if the dismissal from service is found to have been for valid or just cause, i.e., even if the employee is found to have been at fault. I. Retirement Pay 1. Eligibility Retirement (R.A 7641, approved on December 9, 1992 – it has a retroactive effect being a curative social legislation) a) Compulsory – upon reaching 65 years of age; with at least 5 years of service; b) Optional – upon reaching 60 years of age; with at least 5 years of service; at the option of the employee 2. Amount Components of Retirement Pay: a. 15 days based on the employee‘s latest salary; b. 1/12 of the 13th month pay; and c. Cash equivalent of the 5 days service incentive leave.

Computation: 22.5 days x number of years of service (22.5 days: 15 days plus 2.5 days representing 1/12 of the 13th month pay plus 5 days of service incentive leave) 3. Retirement benefits of workers paid by results For covered workers who are paid by results and do not have a fixed monthly salary rate, the basis for the determination of the salary for fifteen (15) days shall be their average daily salary (ADS). The ADS is derived by dividing the total salary or earnings for the last twelve months reckoned from the date of retirement by the number of actual working days in that particular period, provided that the determination of rates of payment by results are in accordance with the established regulations. 4. Retirement benefits of part-time workers Part-time workers are also entitled to retirement pay of ―onemonth salary‖ for every year of service under RA 7641 after satisfying the following conditions precedent for optional retirement: (a) there is no retirement plan between the employer and the employee; and (b) the employee should have reached the age of sixty (60) years, and should have rendered at least five (5) years of service with the employer. Applying the foregoing principle, the components of retirement benefit of part-time workers may likewise be computed at least in proportion to the salary and related benefits due them. 5. Taxability Is retirement pay taxable? SEC. 1, RA 4917 - Any provision of law to the contrary notwithstanding, the retirement benefits received by officials and employees of private firms, whether individual or corporate, in accordance with a reasonable private benefit plan maintained by the employer (1) shall be exempt from all taxes and

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Green Notes 2015

Labor Law

Compiled by: The Barristers’ Club 2015 (2) shall not be liable to attachment, garnishment, levy or seizure by or under any legal or equitable process whatsoever Exception Except to pay a debt of the official or employee concerned to the private benefit plan or that arising from liability imposed in a criminal action: Additional conditions (1) That the retiring official or employee has been in the service of the same employer for at least ten (10) years and is not less than fifty years of age at the time of his retirement; (2) That the retirement benefits shall be availed of by an official or employee only once; and, (3) That in case of separation of an official or employee from the service of the employer due to death, sickness or other physical disability or for any cause beyond the control of the said official or employee, any amount received by him or by his heirs from the employer as a consequence of such separation shall likewise be exempt as hereinabove provided. "Reasonable private benefit plan" means a pension, gratuity, stock bonus or profit sharing plan maintained by an employer for the benefit of some or all of his officials and employees, wherein contributions are made by such employer or officials and employees, or both, for the purpose of distributing to such officials and employees the earnings and principal of the fund thus accumulated, and wherein it is provided in said plan that at no time shall any part of the corpus or income of the fund be used for, or be diverted to, any purpose other than for the exclusive benefit of the said officials and employees. H. Women Workers

as against a male Ee for work of 2. equal value; a. Favoring a respect to

male

Ee

with

3. promotion, training opportunities, study and scholarship grants on account of gender (Art. 135); a. Favoring a male applicant with respect to hiring where the particular job can 4. equally be handled by a woman; or a. Favoring a male Ee over a female Ee with respect to dismissal of personnel. 5. Stipulating, whether as a condition foremployment or continuation of employment: a. That a woman Ee shall not get married, or b. That upon marriage, such woman Ee shall be deemed resigned or separated. (Art.

136)

Note: A woman worker may not be dismissed on the ground of dishonesty for having written ‗‘single‖ on the space for civil status on the application sheet, contrary to the fact that she was married. (PT&T Co. v. NLRC, G.R.

No. 118978, May 23, 1997) 6. Dismissing, discriminating or otherwise prejudice a woman Ee by reason of her being married

(Art. 136);

7. Denying any woman Ee benefits provided by law (Art. 137);

1. Provisions against discrimination What are the unlawful acts against women Ee? 1. Discrimination with respect to the terms and conditions of employment solely on accountof sex: a. Payment of lesser compensation to a female Ee

8. Discharge any woman for the purpose of preventing her from enjoying any of the benefits provided by law (Art. 137); 9. Discharging such woman on account of her pregnancy, or while

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Green Notes 2015

Labor Law

Compiled by: The Barristers’ Club 2015 on leave or in confinement due to her pregnancy (Art. 137);

alternative exist other than the discriminating practice. To justify a BFOQ the employer must prove two factors:

10. Discharging or refusing the admission of such woman upon returning to her work for fear that she may again be pregnant (Art.

1.

137)

Note: Discrimination in any form from preemployment to post employment, including hiring, promotion or assignment, based on the actual, perceived or suspected HIV status of an ndividual is unlawful. (Philippine AIDS

2. That there is a factual basis for believing that all or substantially all persons meeting the qualification would be unable to properly perform the duties of the job. (Star

Prevention and Control Act of 1998, [R.A. 8504])

Under Sec. 2 of R.A. 9710 or the Magna Carta of Women, the State condemns discrimination against women in all its forms and pursues by all appropriate means and without delay the policy of eliminating discrimination against women in keeping with the Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW) and other international instruments consistent with Philippine law. The State shall accord women the rights, protection, and opportunities available to every member of society. The State shall take steps to review and, when necessary, amend and/or repeal existing laws that are discriminatory to women within three (3)years from the effectivity of this Act. (Sec. 12, R.A.9710) 2. Stipulation against marriage

That the employment qualification is reasonably related to the essential operation of the job involved; and

Paper v. Simbol, G.R. No. 164774, April 12, 2006)

What is the importance of the BFOQ Rule? 1.

To ensure that the Ee effectively perform his work;

can

2. So that the no-spouse rule will not impose any danger to business. 3. Prohibited Acts What are the prohibited acts? 4. Anti-Sexual Harassment Act (R.A. No. 7877) Who may be held liable for sexual harassment? In a work, education or trainingrelated environment sexual harassment may be committed by an:

What is the no-spouse employment policy? General Rule: 1. Policy banning spouses from working in the same company; 2. May not facially violate Art. 136 of the LC but it creates a disproportionate effect and the only way it could pass judicial scrutiny is by showing that it is reasonable despite the discriminatory albeit disproportionate effect. Exception: Bona fide occupational qualification rule (BFOQ) What is the BFOQ rule? There must be a finding of any BFOQ to justify an Ers no spouse rule. There must be a compelling business necessity for which no

1. 2. 3. 4. 5. 6. 7.

Ee; Manager; Supervisor; Agent of the (Er); Teacher, instructor, professor; Coach, trainer,;or Any other person who, having authority, influence or moral ascendancy over another in a work or training or education environment: a. Demands b. Requests or c. Requires

8. Any sexual favor from the other, regardless of whether the demand, request or requirement for submission is accepted by the object of R.A. 7877.

(Sec. 3)

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Labor Law

Compiled by: The Barristers’ Club 2015 How is sexual harassment committed?

2. In an education or training environment:

Generally, a person liable demands, requests, or otherwise requires any sexual favor from the other, regardless of whether the demand, request or requirement for submission is accepted by the latter.

a. Against one who is under the care, custody or supervision of the offender;

Under the Sexual Harassment Act, does the definition of sexual harassment require a categorical demand or request for sexual favor? No. It is true that the provision calls for a ―demand, request or requirement of a sexual favor.‖ But it is not necessary that the demand, request or requirement of a sexual favor be articulated in a categorical manner. It may be discerned, with equal certitude, from the acts of the offender. Likewise, it is not essential that the demand, request or requirement be made as a condition for continued employment or for promotion to a higher position. It is enough that the respondent‘s acts result in creating an intimidating, hostile or offensive environment for the employee (Domingo v. Rayala, G.R.

No. 155831, Feb. 18, 2008)

When is sexual harassment committed? Specifically:

In a work-related environment: 1.

or

employment

a. The sexual favor is made as a condition in the hiring or in the employment, re-employment or continued employment of said individual, or in granting said individual favorable compensation, terms, conditions, promotions, or privileges; or the refusal to grant the sexual favor results in limiting, segregating or classifying the Ee which in a way would discriminate, deprive or diminish employment opportunities or otherwise adversely affect said Ee; b. The above acts would impair the Ees‘ rights or privileges under existing labor laws; or c. The above acts would result in an intimidating, hostile, or offensive environment for the Ee.

b. Against one whose education, training, apprenticeship or tutorship is entrusted to the offender; c. Sexual favor is made a condition to the giving of a passing grade, or the granting of honors and scholarships, or the payment of a stipend, allowance or other benefits, privileges, or considerations; or d. Sexual advances result in an intimidating, hostile or offensive environment for the student, trainee or apprentice. What is the liability of the Er, head of office, educational or training institution? Ee shall be solidarily liable for damages arising from the acts of sexual harassment committed in the employment, education or training environment provided: 1. The Er or head of office, educational or training institution is informed of such acts by the offended party; and 2. No immediate action is taken thereon. (Sec. 5) Can an independent action for damages be filed? Yes. Nothing under R.A. 7877 shall preclude the victim of work, education or training-related sexual harassment from instituting a separate and independent action for damages and other affirmative relief (Sec.

6).

What is the three-fold liability rule in sexual harassment cases? An act of sexual harassment may give rise to civil, criminal and administrative liability on the part of the offender, each proceeding independently of the others. When does the action prescribe? Any action shall prescribe in 3 years.

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Labor Law

Compiled by: The Barristers’ Club 2015 K. Employment of Minors (Labor Code and R.A. No. 7678, R.A. No. 9231) What are the general prohibitions? General Rule:

C. Above 18 – no prohibition What is the rule regarding the issuance of work certificates/ permits for children at least 15 but below 18 years of age?

A. Below 15 yrs. Old

The issuance of a DOLE Certificate to youth aged 15 to below 18 years of age is not required by law. No employer shall deny opportunity to any such youth applying for employment merely on the basis of lack of work permit or certificate of eligibility for employment. Any young person aged 15 to below 18 years of age may present copy of this DOLE advisory to any employer, job provider, government authority, or his/her representative when seeking employment or anytime during employment (DOLE Department Advisory No.01-08)

1. The child works directly under the sole responsibility of his parents, or guardians who employ members of his family, subject to the following conditions:

L. Househelpers (Labor Code as amended by R.A. No. 7655, an Act Increasing the Minimum Wage of Househelpers; see also – Household Service under the Civil Code)

a. Employment does not endanger the child‘s safety, health and morals; b. Employment does not impair the child‘s normal development; c. Er-parent or legal guardian provides the child with the primary and/or secondary education prescribed by the Dept. of Education

What is domestic or household service? 1. Services in the Ers home; 2. Usually necessary or desirable; 3. For the maintenance and employment thereof; 4. Includes ministering to the personal comfort and convenience of the members of the Ers household; and 5. Including services of family drivers

1. No person under 18 years of age will be allowed to be employed in an undertaking which is hazardous or deleterious in nature; and 2. No Er shall discriminate against any person in respect to terms and conditions of employment on account of his age. Exceptions:

2. The child‘s employment or participation in public entertainment or information through cinema, theater, radio or television is essential provided: a. Employment contract is concluded by the child‘s parents or legal guardian; b. With the express agreement of the child concerned, if possible, and c. The approval of DOLE, the following must be complied with: i. The employment does not involve advertisement or commercials promoting alcoholic beverages, intoxicating drinks, tobacco and its by-products or exhibiting violence; ii. there is a written contract approved by DOLE; and iii. the conditions provided in the first instance are met. B. Above 15 but below 18 – may be employed in any non-hazardous work

Who is a househelper? A househelper is synonymous to domestic servant: 1. Any person, male or female; 2. Who renders services in and about the Ers home and; 3. Services are usually necessary or desirable for the maintenance and 1. enjoyment thereof; and 4. Ministers exclusively to the personal comfort and enjoyment of Ers family. Note: The children and relatives of a house helper who live under the Ers roof and who share the accommodations provided for the house helper by the Er shall not be deemed as househelper‘s if they are not otherwise engaged as such and are not required to

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Compiled by: The Barristers’ Club 2015 perform any substantial household work. (Sec

3, Rule XII, Book III, IRR)

The definition of a househelper cannot be interpreted to include househelp or laundry women working in staffhouses of a company

(APEX Mining CO., Inc., v. NLRC, G.R. No. 94951, April 22, 1991) What are the rights of househelpers? 1.

Original contract of domestic service shall not last for more than 2 years but it may be renewed by the parties (Art.

142);

2. Entitled to minimum wage in addition to lodging, food, and medical attendance (Art. 144); 3. Employment contract should be reviewed every 3 years with the end view of improving the terms and conditions of 5. employment (Art. 143); 4. SSS benefits for those who are receiving at least P1,000 per month

(Art. 143);

5. Non-assignment to a work in a commercial, industrial or agricultural enterprise at a wage or salary rate lower than that provided for agricultural or non -agricultural workers (Art. 145); 6. Ees under 18 years of age shall be given opportunity for at least elementary education. The cost of education shall be part of the HH‘s compensation, unless otherwise stipulated (Art 146); 7. Should be treated in a just and humane manner (Art. 147); 8. Not to be treated with physical violence (Art. 147); 9. Suitable and sanitary living headquarters as well as adequate food and medical attendance (Art. 148;) 10. Termination of employment should be; 11. upon expiration of term of employment or; 12. based on just cause (Art. 149); 13. Indemnity for unjust termination of service; and 14. Employment certification as to nature and duration of service and efficiency and conduct of househelper.

M. Employment of Homeworkers Who are homeworkers? They are those who perform in or about his own home any processing or fabrication of goods or materials, in whole or in part, which have been furnished directly or indirectly, by an Er and sold thereafter to the latter. Distinction between Househelper and Homeworker Househelpers Homeworkers Performs in or about his own home any processing or fabrication Minister to the of goods or materials, in personal needs and whole or in part, which comfort of his Er in have been furnished the latter‘s home directly or indirectly, by an Er and soldthereafter to the latter Minimum Wage of Househelpers (RA 7655) The minimum compensation of eight hundred pesos (P800.00) a month is required for househelper s in the cities of Caloocan, Las Piñas, Makati , Malabon, Mandaluyong, Manila, Marikina, Muntinlupa, Navotas ,Parañaque, Pasay, Pasig, Quezon, San Juan, Taguig, Valenzuela, and in themunicipality of Pateros. Meanwhile, a compensation of six hundred fifty pesos (P650.00)a month is required for househelpers in other chartered cities—cities other than Manila, Pasay, Quezon, and Caloocan—highly urbanized cities, and first -class municipalities. On the other hand, a compensation of five hundred fifty pesos (P550.00) a month is required for househelpers in other municipalities. Househelpers who are receiving at least one thousand pesos (P1,000.00) a month shall be covered by the Social Security System and shall be entitled to all the benefits provided therein. Employers shall review the employment contracts of their househelpers every three (3) years with the end in view of improving the terms and conditions thereof.

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Labor Law

Compiled by: The Barristers’ Club 2015 N. Apprentices and Learners 1.

4. Which shall not exceed 3 months; and 5. Whether or not such practical training is supplemented by theoretical instructions. (Sec. 1a, Rule VII, Book II,

Apprentices

IRR)

Who is an apprentice? Any worker who is covered by a written apprenticeship agreement with an individual employer or any of the entities recognized under the Labor Code.

When may learners be employed? a. When no experienced worker is available b. It is necessary to prevent curtailment of employment opportunities; and c. Employment does not create unfair competition in terms of labor costs or impair or lower working standards.

What is apprenticeship? It is practical training on the job supplemented by related theoretical instruction. What is an apprenticeable occupation? It requires more than 3 months of practical training with theoretical instruction. What is on the job training (OJT)?

What is a learnership agreement? Any employer desiring to employ learners shall enter into a learnership agreement with them,which agreement shall include:

It is practical work experience through actual participation in productive activities given to or acquired by an apprentice.

1.

The names and addresses of the learners; 2. The duration of the learnership period, which shall not exceed 3 months; 3. The wages or salary rates of the learners which shall begin at not less than 75% of the applicable minimum wage; and 4. A commitment to employ the learners if they so desire, as regular employees upon completion of the learnership.

What is the wage rate of an apprentice? Start at not less than 75% of the statutory minimum wage for the 1st 6 months (except OJT); thereafter, shall be paid in full minimum wage, including the full COLA. Note: Apprenticeship programs shall be primarily voluntary. What are the rules on working scholars? There is no Employer–Employee relationship between students on one hand, and schools, where there is written agreement between them under which the former agree to work for the latter in exchange for the privilege to study free of charge. The student is not considered an employee. (Sec. 14, Rule IX,

What is the status of learners who have been allowed or suffered work during the first 2 months, if training is terminated by the Employer before the end of the stipulated period through no fault of the learner? They are deemed regular employees.

(Sec. 4, RuleVII, Book II, IRR)

Book III, IRR) 2. Learners 1.

They are persons hired as trainees in semi-skilled and other industrial occupations; 2. Which are non-apprenticeable; 3. Which may be learned through practical training on the job in a relatively short period of time;

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Labor Law

Compiled by: The Barristers’ Club 2015 Distinguish Learnership from Apprenticeship Learnership

Distinction between handicapped and disabled

Apprenticeship

Nature

Handicapped

Training in trades Training on the job in which are semi-skilled and other apprenticeable, that industrial occupation or is, practical training trades which are nonon the job apprenticeable supplemented by and which may be related theoretical learned thru practical instruction for training on the job in a more than 3 relatively short period months. of time

Covers workers.

Duration of training Max: 3 months Min: 3 months

Max: 6 months

loss or Basis: range of activity impairment of which is normal for a earning capacity. human being. No commitment to Hire

In case of pretermination of contract Considered a regular employee if pretermination occurs after 2 months of training and the dismissal is without fault of the learner.

Worker not considered as regular employee

Coverage

Highly technical industries and only in industrial occupation

Semi-skilled/Industrial occupations There is learnable TESDA

a list trades

of by

Loss due to injury or physical or mental defect or age. If hired, entitled to 75% of minimum wage. Subject to definite periods of employment. Employable only when necessary to prevent curtailment of employment opportunity.

Restriction due to impairment of mental/physical/ sensory defect. If qualified, entitled to all terms and conditions as qualified able-bodied person. No restrictions on employment. Must get equal opportunity and no unfair competition.

Who are handicapped workers?

No list

Written agreement Requires Learnership Agreement

only

Basis:

Commitment to employ

With commitment to employ the learner as a regular employee if he desires upon completion of learnership

Earning capacity is impaired by age, or physical or mental deficiency or injury.

Disabled (Differently Abled) Refers to all suffering from restriction of different abilities as a result of mental, physical or sensory impairment to perform an activity in the manner or within range considered normal for a human being. Covers all activities or endeavors.

Requires Apprenticeship Agreement

O. Persons with disability (R.A. No. 7277, as amended by R.A. No. 9442)

Those whose earning capacity impaired by: 1. Physical deficiency; 2. Age; 3. Injury; 4. Disease; 5. Mental deficiency; and 6. Illness.

is

What is the duration of the employment period of handicapped workers?

a. Definition Persons with disability refer to those who are suffering from certain limitations to perform an activity in the manner considered normal for a human being, as a result of mental, physical or sensory impairment (Sec. 4 (a), RA 9442).

There is no minimum or maximum duration. It depends on the agreement but it is necessary that there is a specific duration stated.

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Labor Law

Compiled by: The Barristers’ Club 2015 May handicapped workers apprentices or learners?

be

hired

as

What is the prohibition on discrimination against disabled workers?

Yes, if their handicap is not such as to effectively impede the performance of job operations in the particular occupations for which they are hired Art. 81).

No disable person shall be denied access to opportunities for suitable employment. A qualified disabled employee shall be subject to the same terms and conditions of employment and the same compensation, privileges, benefits, fringe benefits, incentives or allowances as a qualified able bodied person.

Can a handicapped workers acquire the status of a regular Employee? Yes, if work is usually or necessarily or desirable to the business. (Bernardo v. NLRC,

G.R No. 122917, July 12, 1999)

Who may employ handicapped workers? Employers in all industries. Provided, the handicap is not such as to effectively impede the performance of job operations in the particular occupations for which they are hired. When can handicapped workers be employed? 1. When their employment is necessary to prevent curtailment of employment opportunities; and 2. When it will not create unfair competition in labor costs or lower working standards.(Art.79) b. Rights of disabled workers What are the rights and privileges of disabled workers? 1. 2.

3. 4.

5.

Equal opportunity for employment; Sheltered employment (the gov‘t shall endeavour to provide them work if suitable employment for disabled persons cannot be found through open employment); Apprenticeship; Vocational rehabilitation (means to develop the skills and potentials of disabled workers and enable them to compete in the labor market); and Vocational guidance and counseling.

c. Prohibitions on discrimination against disabled persons

Five percent (5%) of all casual emergency and contractual positions in the Departments of Social Welfare and Development; Health; Education, Culture and Sports; and other government agencies, offices or corporations engaged in social development shall be reserved for disabled persons. d. Incentives for employers What are the incentives provided for employers in employing disabled workers? 1. Entitled to an additional deduction, from their gross income, equivalent to twentyfive percent (25%) of the total amount paid as salaries and wages to disabled persons: Provided, however, That such entities present proof as certified by the Department of Labor and Employment that disabled persons are under their employ: Provided, further, That the disabled employee is accredited with the Department of Labor and Employment and the Department of Health as to his disability, skills and qualifications; and 2. Private entities that improve or modify their physical facilities in order to provide reasonable accommodation for disabled persons shall also be entitled to an additional deduction from their net taxable income, equivalent to fifty percent (50%) of the direct costs of the improvements or modifications.

IV. Termination of Employment A. Employer-Employee Relationship What determines the existence employment relationship?

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of

an

Green Notes 2015

Labor Law

Compiled by: The Barristers’ Club 2015 It is determined by law and not by contract. Whether or not an Er-Ee relationship exists between the parties is a question of fact. In this regard, the findings of the NLRC are accorded not only respect but finality if supported by evidence. Note: Taxi or jeepney drivers under the ―boundary‖ system are Ee‘s of the taxi or jeepney owners/operators; so also the passenger bus drivers and conductors (Jardin vs. NLRC and Goodman Taxi, G.R. No. 119268, Feb. 23, 2000). 1. Four Fold Test In determining whether a given set of circumstances constitute or exhibit an employer-employee relationship, the accepted rule is that the elements or circumstances relating to the following matters shall be examined and considered: a. selection and engagement of the employees; b. payment of wages; c. power of dismissal; and d. power to control the employees‘ conduct. NOTE: The ―control test‖ is the most crucial and determinative indication of the presence or absence of an employer-employee relationship. Absence of such despite the presence of the other three elements will not suffice for the relationship to exist. Not every form of control will have the effect of establishing an employer-employee relationship. A line should be drawn between: a. Rules that merely serves as guidelines, which only promote the result. In such case, no employer-employee relationship exists; and b. Rules that fix the methodology and bind or restrict the party hired to the use of such means of methods. These address both the result and means employed to achieve it and hence, employer-employee relationship exist. What is control test?

the end to be achieved but also the means to be used in reaching such end. Note: However, in certain cases the control test is not sufficient to give a complete picture of the relationship between the parties, owing to the complexity of such a relationship where several positions have been held by the worker. The better approach is to adopt the two-tiered test (Francisco vs. NLRC, G.R. No.

170087, Aug. 31, 2006).

What is the two-tiered test? 1. The putative Er‘s power to control the Ee with respect to the means and methods by which the work is to be accomplished; and 2. The underlying economic realitiesof the activity or relationship. Note: This two-tiered test would provide us with a framework of analysis, which would take into consideration the totality of circumstances surrounding the true nature of the relationship between the parties. This is especially appropriate in this case where there is no written agreement or terms of reference to base the relationship on and due to the complexity of the relationship based on the various positions and responsibilities given to the worker over the period of the latter‘s employment (Francisco vs. NLRC, G.R. No.

170087, Aug. 31, 2006).

What is the proper standard for economic dependence? The proper standard is whether the worker is dependent on the alleged employer for his continued employment in that line of business. 2. Kinds of Employment a) Probationary Employment Probationary employment exists where the employee, upon his engagement is made to undergo a trial period during which the employer determines his fitness to qualify for regular employment based on reasonable standards made known to him at the time of his engagement (Art 282, LC).

The person for whom the services are performed reserves a right to control not only

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Labor Law

Compiled by: The Barristers’ Club 2015 What are the characteristics of probationary employment? 1. It is an employment for a trial period; 2. It is a temporary employment status prior to regular employment; 3. It arises through a contract with the following elements: 4. The employee (Ee) must learn and work at a particular type of work 5. Such work calls for certain qualifications 6. The probation is fixed 7. The Er reserves the power to terminate during or at the end of the trial period 8. And if the Ee has learned the job to the satisfaction of the Er, he becomes a regular Ee.

General Rule: It shall not exceed 6 months. Exceptions:

2. 3.

4.

5.

No. The evil sought to be prevented is to discourage scheming employers from using the system of double or successive probation to circumvent the mandate of the law on regularization and make it easier for them to dismiss their employees. (Holiday Inn Manila

v. NLRC, G.R. No. 109114, Sep. 14, 2003)

A probationary employee may be terminated on two grounds: 1. Just/authorized causes; or 2. When he fails to qualify as a regular Ee in accordance with reasonable standards made known by the employer (Er) to the Ee at the time of his engagement (ICMC v. NLRC,

G.R. No. 72222, Jan. 30, 1989)

What is the period of probationary employment?

1.

Is double or successive probation allowed?

Covered by an apprenticeship or learnership agreement stipulating a different period; Voluntary agreement of parties (especially when the nature of work requires a longer period); The Er gives the(Ee a second chance to pass the standards set. (Mariwasa Manufacturing, Inc. v. Leogardo, Jr.,G.R. No. 74246, Jan. 26, 1989); When the same is required by the nature of the work, e.g. the probationary period set for professors, instructors and teachers is 3 consecutive years of satisfactory service pursuant to DOLE Manual of Regulations for Private Schools. When the same is established by company policy.

Note: Period of probation shall be reckoned from the date the Ee actually started working (Sec.6 [b], Rule I, Book VI, IRR). After the lapse of the probationary period (6 months), Ee becomes regular. Probationary Ees may be dismissed before end of the probationary period.

Note: While probationary Ees do not enjoy permanent status, they are afforded the security of tenure protection of the Constitution. Consequently, they cannot be removed from their positions unless for cause. Such constitutional protection, however, ends upon the expiration of the period stated in their probationary contract of employment. Thereafter, the parties are free to renew the contract or not (CSA v. NLRC, G.R. No.

87333, Sep. 6, 1991).

What are the limitations on the employer‘s powers to terminate a probationary employment contract? 1. The power must be exercised in accordance with the specific requirements of the contract; 2. If a particular time is prescribed, the termination must be within such time and if formal notice is required, then that form must be used; 3. The Er‘s dissatisfaction must be real and in good faith, not feigned so as to circumvent the contract or the law; and 4. There must be discrimination in the dismissal

no

unlawful

Note: The probationary employee is entitled to procedural due process prior to dismissal from service.

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Compiled by: The Barristers’ Club 2015 b) Regular Employment What is regular employment? 1. An employee is deemed to be regular where he has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer, the provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties (Art. 280, LC); 2. The primary standard is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. The test is whether the former is usually necessary or desirable in the usual business or trade of the employer. The connection can be determined by considering the nature of the work performed and its relation to the scheme of the particular business or trade in its entirety. What is the employment?

test

to

determine

regular

1. The primary standard of determining regular employment is the reasonable connection between the particular activity performed by the employee (Ee) to the usual trade or business of the employer. The test is whether the former is usually necessary or desirable in the usual business or trade of the Er (De Leon v. NLRC, G.R. No. 70705, Aug.

21, 1989).

Note: The connection can be determined by considering the nature of the work performed and its relation to the scheme of the particular business or trade in its entirety

(Highway Copra Traders v. NLRC, G.R. No. 108889, July 30, 1998).

2. Also, the performance of a job for at least a year is sufficient evidence of the job‘s necessity if not indispensability to the business. This is the rule even if its performance is not continuous and merely intermittent. The employment is considered regular, but only with respect to such activity and while such activity exists (Universal Robina Corp. v.

day immediately after the end of his first year of service. The law does not provide the qualification that the Ee must first be issued a regular appointment or must first be formally declared as such before he can acquire a regular status. (Aurora Land Projects Corp. v.

NLRC, G.R. No. 114733, Jan. 2, 1997)

May route helpers be considered as regular employees? Yes, the Court categorically declared that the nature of work of route helpers hired by Coca-Cola Bottlers Phils., Inc. is necessary and desirable in its usual business or trade thereby qualifying them as regular employees, to wit; ―Coca-Cola Bottlers Phils., Inc., is one of the leading and largest manufacturers of softdrinks in the country. Respondent workers have long been in the service of petitioner company. Respondent workers, when hired, would go with route salesmen on board delivery trucks and undertake the laborious task of loading and unloading softdrink products of petitioner company to its various delivery points.‖ (Basan, et. Al. vs. Coca-Cola Bottlers Philippines, G.R. No. 174365-66, February 4, 2015). c) Project Employment It is where the employment has been fixed for a specific project or undertaking the completion or termina-tion of which has been determined at the time of the engagement of the employee (Art. 286, Labor Code). What are the Employment?

indicators

of

Project

Either one or more of the following circumstances, among others, may be considered as indicators that an employee is a project employee: a. The duration of the specific/identified undertaking for which the worker is engaged is reasonably determinable;

Catapang, G.R. No. 164736, Oct. 14, 2005).

b. Such duration, as well as the specific work/service to be performed, is defined in an employment agreement and is made clear to the employee at the time of hiring.

Note: The status of regular employment attaches to the casual Ee on the

Note: Absent any other proof that the project employees were informed of their

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Labor Law

Compiled by: The Barristers’ Club 2015 status as such, it will be presumed that they are regular employees. c. The work/service performed by the employee is in connection with the particular project/undertaking for which he is engaged; d. The employee, while not employed and awaiting engagement, is free to offer his services to any other employer; e. The termination of his employment in the particular project/undertaking is reported to the Department of Labor and Employment Regional Office having jurisdiction over the workplace within 30 days following the date of his separation from work, using the prescribed form on employees‘ termination or dismissal or suspensions; and

A project employee is one whose termination of his employment contract is reported to the DOLE everytime the project for which he was engaged has been completed (Manalo, et al. vs. TNS Philippines, Inc., G.R. No. 208567, November 26, 2014). f. An undertaking in the employment contract by the employer to pay completion bonus to the project employee as practiced by most construction companies. What are the requisites in determining whether an employee (Ee) is a project Ee? 1. The project Ee was assigned to carry out a specific project or undertaking, and 2. The duration and scope of which were specified at the time the Ee was engaged for that project. (Imbuido v. NLRC, G.R. No.

114734, Mar. 31, 2000)

3. The Ee must have been dismissed every after completion of his project or phase; and 4. Report to the DOLE of Ee‘s dismissal on account of completion of contract (Policy

Inst. No. 20; D.O. 19 [1997]) What is a project?

A "project" has reference to a particular job or undertaking that may or may not be within the regular or usual business of the Er. In either case, the project must be distinct,

separate and identifiable from the main business of the Er, and its duration must be determined or determinable (PAL v. NLRC,

G.R. No. 125792, Nov. 9, 1998).

Distinguishable Types of Project Activities (ALU-TUCP vs. NLRC, 234 SCRA 328): 1. A particular job or undertaking that is WITHIN THE REGULAR OR USUAL BUSINESS of the employer company, but which is DISTINCT and SEPARATE, and IDENTIFIABLE as such, from the other undertakings of the company. Such job or undertaking begins and ends at determined or determinable times. e.g. A construction company which has construction projects in Manila, Mandaluyong and Baguio. 2. A particular job or undertaking that is NOT WITHIN THE REGULAR BUSINESS of the corporation. Such a job or undertaking must also be IDENTIFIABLY SEPARATE and DISTINCT from the regular business. The job or undertaking also begins and ends at determined or determinable times. e.g. A steel-making company undertakes projects related to breeding and production of fish or cultivation of vegetables. General Rule: LENGTH OF SERVICE is not controlling in project employment (Hilario Rada vs. NLRC, 205 SCRA 69). Exception: Although the work to be performed is only for a SPECIFIC PROJECT or SEASONAL, where a person thus engaged has been performing the job for at least one year, even if the performance is not continuous or is merely intermittent, the law deems the REPEATED and CONTINUING NEED FOR ITS PERFORMANCE as being sufficient to indicate the necessity or desirability of that activity to the business or trade of the employer. The employment of such person is also then deemed to be REGULAR WITH RESPECT TO SUCH ACTIVITY and WHILE SUCH ACTIVITY EXISTS (Magsalin, et.al. vs. National Organization of Working Men, et al., May 9, 2003).

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Compiled by: The Barristers’ Club 2015 d) Seasonal Employment Seasonal workers are those who are called to work from time to time according to the occurrence of varying need during a season, and are laid off after completion of the required phase of work.

specific date of termination. The determining factor of such contracts is not the duty of the employee but the day certain agreed upon by the parties for the commencement and termination of the employment relationship (Fonterra Brands Phils. Inc. vs. Largado, G.R. No. 205300, March 18, 2015).

Seasonal workers who works for more than one season are deemed to have acquired regular employment.

3. Job Contracting

Seasonal workers during the off season are merely considered on leave. They are also entitled to separation pay.

1. Labor-only contracting

e) Casual Employment It is one wherein an employee is engaged to perform activities which are not necessary or desirable in the usual trade or business of the employer. f) Fixed-term It is a contract of employment for a definite period which terminates by its own terms at the end of such period (Brent School vs. Zamora, 181 SCRA 702). Criteria for fixed term employment contracts so that the same will not circumvent security of tenure (Phil. National Oil Company-Energy Development Corp. vs. NLRC, et al., 239 SCRA 272): 1. The fixed period of employment was knowingly and voluntarily agreed upon by the parties, without any force, duress or improper pressure being brought to bear upon the employee and absent any other circumstances vitiating his consent; or 2. It satisfactorily appears that the employer and employee dealt with each other on more or less equal terms with no moral dominance whatever being exercised by the former on the latter. Are fixed-term employment contracts limited? No, fixed-term employment contracts are not limited. As they are under the present Labor Code, to those by nature seasonal or for specific projects with predetermined dates of completion; they also include those to which the parties by free choice have assigned a

Job Contracting and Labor-Only Contracting

a. the person supplying workers to an employer does not have substantial capital or investment in the form of tools, equipment, machineries, work premises, among others; and b. the workers recruited and placed by such person are performing activities which are directly related to the principal business of such employer (Baguio, et.al vs. NLRC, et al., 202 SCRA 465) 2. Job Contracting a. the contractor caries on an independent business and undertakes the contract work on his own account and under his own responsibility according to his own manner and method, free from the control and direction of his employer or principal in all matters connected with the performance of the work except as to the results thereof; and b. the contractor has substantial capital or investment in the form of tools, equipment, machineries, work premises, and other materials which are necessary in the conduct of his business. Who is the employer in a Job Contractorship? The contractor is the employer, i.e., for purposes of security of tenure. For unpaid wages and benefits, the principal is solidarily liable (Meralco Industrial Engineering Services Corp. vs. NLRC, G.R. No. 145402, March 14, 2008). What are the evidence of Job Contractorship? 1. Certificate of Business Registration; 2. Certificate of Registration with the Bureau of Internal Revenue;

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Compiled by: The Barristers’ Club 2015 3. Mayor‘s Permit; 4. Certificate of Membership with the Social Security System; 5. Certificate of Registration with the Department of Labor and Employment; 6. Company Profile; and 7. Certifications issued by its clients (Fonterra Brands Phils. Inc. vs. Largado, G.R. No. 205300, March 18, 2015). Distinguish between job contracting and labor only contracting Labor-Only Job Contracting Contracting Liability is limited (shall be solidarily Liability extends to all liable with Er only those provided under when the Er fails to the Labor Standards comply with req‘ts as law to unpaid wages and other labor standards violations) Permissible, subject Prohibited by Law only to certain conditions The contractor has Has no substantial substantial capital or capital or investment investment What is the effect for failure of owner of project to require the contractor to post bond? The owner of the project must answer for whatever liabilities the contractor may have incurred to his employees; without prejudice on the part of the project owner to seek reimbursement from the contractor (Baguio, et al. vs. NLRC). a. Article 106 to Article 109 of the Labor Code b. Department Order No. 18-A c. Department Circular No. 01-12 d. Effects of Labor-only Contracting 1. The subcontractor will be treated as the agent of the principal, and representations by the subcontractor to the employees will bind the principal; 2. The principal will become the employer as if it directly employed the workers, and will be responsible for all their entitlements and benefits under the labor laws;

3. The principal and the subcontractor will be solidarily treated as the employer; and 4. The employees will become employees of the principal, subject to the classifications of employees under Article 280 of the Labor Code. (Department order no. 18A, s. 2011) e. Trilateral Relationship in Job Contracting ―Trilateral Relationship‖ refers to the relationship in a contracting or subcontracting arrangement where there is a contract for a specific job, work or service between the principal and the contractor, and a contract of employment between the contractor and its workers. There are three (3) parties involved in these arrangements: the principal who decides to farm out a job, work or service to a contractor; the contractor who has the capacity to independently undertake the performance of the job, work or service; and the contractual workers engaged by the contractor to accomplish the job, work or service (Section 3 (m), Dept. order No. 18 A) Trilateral relationship in contracting arrangements; Solidary Liability In legitimate contracting subcontracting arrangement there exists:

or

1. An employer-employee relationship between the contractor and the employees it engaged to perform the specific job, work or service being contracted; and 2. A contractual relationship between the principal and the contractor as governed by the provisions of the Civil Code. In the event of any violation of any provision of the Labor Code, including the failure to pay wages, there exists a solidary liability on the part of the principal and the contractor for purposes of enforcing the provisions of the Labor Code and other social legislation, to the extent of the work performed under the employment contract. However, the principal shall be deemed the direct employer of the contractor‘s employee in cases where there is a finding by a competent authority of labor-only contracting, or commission of prohibited activities as provided in Section 7, or a violation of either Sections 8 or 9 hereof. (Secton 5, Dept. order No. 18-A)

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Compiled by: The Barristers’ Club 2015 B. Dismissal from employment

b. Sufficiently made known to the Ee c. Must pertain to or be in connection with the duties which the Ee has been engaged to discharge. (Cosep V. NLRC,

1. Just causes What are the just causes for termination (Art. 282, LC)? 1. Serious misconduct or willful disobedience by the employee (Ee) of the lawful orders of his employer (Er) or representative in connection with his work; 2. Gross and habitual neglect by the Ee of his duties; 3. Fraud or willful breach by the Ee of the trust reposed in him by his Er or duly organized representative; 4. Commission of a crime or offense by the Ee against the person of his Er or any immediate member of his family or his duly authorized representative; and 5. Other causes analogous to the foregoing. Note: The burden of proving that the termination was for a valid or authorized cause shall rest on the Er. (Art. 277[b]) What are the elements of serious misconduct?

G.R. No. 124966 June 16, 1998)

Note: There is no law that compels an Ee to accept a promotion for the reason that a promotion is in the nature of a gift or reward, which a person has the right to refuse. The exercise of the Ee of the right to refuse a promotion cannot be considered in law as insubordination or willful disobedience (PT&T

Corp. v. CA, G.R. No. 152057, Sep. 29, 2003). When is there Gross Negligence?

Gross negligence implies a want or absence of or failure to exercise slight care of diligence of the entire absence of care it evinces thoughtless disregard of consequences without exerting any effort to avoid them. However, such neglect must not only be gross but habitual in character. (Judy Phils. v. NLRC,

G.R. No. 111934, April 29, 1998)

What are the requirements for a valid finding of abandonment? For a valid finding of abandonment, 2 factors must be present:

1. It must be serious or of such a grave aggravated character;

1. The failure to report for work, or absence without valid or justifiable reason; and

2. Must relate to the performance of the employees (Ee) duties;

2. A clear intention to sever Er-Ee relationship, with the 2nd element as the more determinative factor, being manifested by some overt acts. (Sta. Catalina College s. NLRC, G.R. No. 144483, Nov. 19, 2003)

and

3. Ee has become unfit to continue working for the employer. (Philippine Aeolus Automotive United Corp. v. NLRC, G.R. No. 124617, April 28, 2000) When is willful disobedience of the Er‘s lawful orders a just cause for termination? 2 requisites must concur: 1. The employees (Ees) assailed conduct must have been willful or intentional, the willfulness being characterized by a wrongful and perverse attitude. 2. The disobeyed orders, regulations or instructions of the Er must be: a. Reasonable and lawful

When is breach of trust/loss of confidence a just cause for termination? 1. It applies only to cases involving: a. Employees (Ees) occupying positions of trust and confidence (confidential and managerial Ee‘s) – to this class belong managerial Ees, i.e., those vested with the

powers or prerogatives to lay down management policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline Ees or effectively recommend such managerial actions; and

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Compiled by: The Barristers’ Club 2015 b. Ees routinely charged with the care and custody of the employer‘s (Er‘s) money or property – to this class belong cashiers,

auditors, property custodians, etc., or those who, in the normal and routine exercise of their functions, regularly handle significant amounts of money or property. (Mabeza v.

NLRC, G.R. No. 118506 April 18, 1997);

2. The loss of trust and confidence must be based on willful breach; Note: A breach is willful if it is done intentionally, knowingly, and purposely without justifiable excuse, as distinguished from an act done carelessly, thoughtlessly, heedlessly, or inadvertently (De la Cruz v.

NLRC, G.R. No. 119536, Feb. 17, 1997)

3. The act constituting the breach must be ―work--related‖ such as would show the Ee concerned to be unfit to continue working for the Er (Gonzales V. NLRC, G.R. No. 131653,

Mar. 26, 2001);

4. It must be substantial and founded on clearly established facts sufficient to warrant the Ee‘s separation from employment (Sulpicio

Lines Inc. V. Gulde, G.R. No. 149930, Feb. 22, 2002); and

5. Fraud must be committed against the Er or his representatives. Note: The treatment of rank and file personneland managerial Ees in so far as the application of the doctrine of loss of trust and confidence is concerned is different. As regards managerial Ees, such as Caoile, mere existence of a basis for believing that such Ee has breached the trust of his Er would suffice for his dismissal (Caoile v. NLRC, G.R. No. 115491,

Nov. 24, 1998)

What are the guidelines for the doctrine of loss of confidence to apply? 1. Loss of confidence should not be simulated (reasonable basis for loss of trust and confidence); 2. Not used for subterfuge for causes which are improper and/or illegal and unjustified; 3. Not arbitrarily asserted in the face of overwhelming evidence to the contrary;

4. Must be genuine, not a mere afterthought to justify earlier action taken in bad faith; and 5. The Ee involved holds a position of trust and confidence. Note: The breach of trust must rest on substantial grounds and not on the Er‘s arbitrariness, whims, caprices, or suspicion; otherwise, the Ee would eternally remain at the mercy of the Er. It should be genuine and not simulated, nor should it appear as a mere afterthought to justify earlier action taken in bad faith of a subterfuge for causes which are improper, illegal, or unjustified. It has never been intended to afford and occasion for abuse because of its subjective nature. There must, therefore, be an actual breach of dully committed by the employee which must be established by substantial evidence. What is required for an act to be included in analogous cases of just causes of termination? Must be due to the voluntary and/or willful act or omission of the employee

(Nadura v. Benguet Consolidated, G.R. No. L17780, Aug. 24, 1962) What is the doctrine of incompatibility? Where the employee has done something that is contrary or incompatible with the faithful performance of his duties, his employer has a just cause for terminating his employment. (Manila Chauffeur‘s League v.

Bachrach Motor Co., G.R. No.L-47071, June 17, 1940 ) 2. Authorized Causes What are the authorized causes of termination by the employer (Er)?

1. Installation of labor-saving devices

(automation/robotics)

2. Redundancy (superfluity in the performance of a particular work) – exists where the services of an employee (Ee) are in excess of what is reasonably demanded by the actual requirements of the enterprise.

(Wiltshire File Co., Inc. v. NLRC, G.R. No. 82249, Feb. 7, 1991)

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Compiled by: The Barristers’ Club 2015 Note: The redundancy should not have been created by the Er.

5. Relocation of business to a distant place; 6. Defiance of return-to work-order; 7. Commission of Illegal acts in strike; 8. Violation of contractual agreement; and 9. Retirement.

3. Reorganization Note: An Er is not precluded from adopting a new policy conducive to a more economical and effective management, and the law does not require that the Er should be suffering financial losses before he can terminate the services of the employee on the ground of redundancy (DOLE Phil., Inc. v. NLRC, G.R. No. L-55413, July 25, 1983) 4. Retrenchment – cutting of expenses and includes the reduction of personnel; It is a management prerogative, a means to protect and preserve the Er‘s viability and ensure his survival. To be an authorized cause it must be affected in good faith (GF) and for the retrenchment, which is after all a drastic recourse with serious consequences for the livelihood of the Ee‘s or otherwise laid-off. Note: The phrase ―to prevent losses‖ means that retrenchment or termination from the service of some Ees is authorized to be undertaken by the Er sometime before the anticipated losses are actually sustained or realized. Evidently, actual losses need not set in prior to retrenchment. (Cajucom VII v. TP

Phils Cement Corp., et al, G.R. No. 149090, Feb. 11, 2005)

5. Closing or cessation of operation of the establishment or undertaking – must be

What are the procedural steps required in termination of an employee for authorized causes? 1. Written Notice to DOLE 30 days prior to the intended day of termination;

Purpose: To enable it to ascertain the verity of the cause of termination. 2. Written notice to Ee concerned 30 days prior the intended date of termination; 3. Payment of separation pay -Serious business losses do not excuse the Er from complying with the clearance or report required in Art. 283 of the LC and its IRR before terminating the employment of its workers. In the absence of justifying circumstances, the failure of the Er to observe the procedural req‘ts under Art. 284 taints their actuations with bad faith if the lay-off was temporary but then serious business losses prevented the reinstatement of respondents, the Er‘s should have complied with the require ents of written notice. What are the requisites of a valid redundancy?

done in good faith and not for the purpose of circumventing pertinent labor laws.

6. Disease – must be incurable within 6 months and the continued employment is prohibited by law or prejudicial to his health as well as to the health of his co-Ees with a certification from the public health officer that the disease is incurable within 6 months despite due to medication and treatment. What are other authorized causes?

1.

2.

3. 4.

1.

Valid application of union security clause; 2. Expiration of period in term of employment; 3. Completion of project in project employment; 4. Failure in probation;

5. 6. 7.

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Written notice served on both the employees (Ees) and the DOLE at least 1 month prior to separation from work; Payment of separation pay equivalent to at least 1 month pay or at least 1 month pay for every year of service, whichever is higher; Good faith in abolishing redundant position; Fair and reasonable criteria in ascertaining what positions are to be declared redundant; Less preferred status, e.g. temporary Ee; Efficiency; and Seniority.

Green Notes 2015

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Compiled by: The Barristers’ Club 2015

5. The employer used fair and reasonable

What are the circumstances that must be present for a valid retrenchment?

criteria in ascertaining who would be retained among the Ees, such as status, efficiency, seniority, physical fitness, age, and financial hardship of certain workers (Asian Alcohol Corp. v. NLRC,

1. The losses expected should be substantial and not merely de minimis in extent -If the loss purportedly sought to be forestalled by retrenchment is clearly shown to be insubstantial and inconsequential in character, the bona fide nature of the retrenchment would appear to be seriously in question; 2. The substantial loss apprehended reasonably imminent -as such imminence can be perceived objectively and in good faith by the employer (Er). There should be a certain degree of urgency for the retrenchment;

must

be

3. It must be reasonably necessary and likely to prevent the expected losse -The Er

should have taken other measures prior or parallel to retrenchment to forestall losses such as cutting other costs than labor costs; 4. The alleged losses if already realized, and the expected imminent losses sought to be forestalled, must be proved by sufficient and convincing evidence -The reason for requiring this quantum of proof is readily apparent: any less exacting standard of proof would render too easy the abuse of this ground for termination of services of employees (Lopez Sugar Corp. v. Federation of Free Workers, G.R. No. 75700-01, Aug. 30, 1990).

G.R. No. 131108, Mar. 25, 1999). What is the ―last in first out (LIFO)‖ rule?

It applies in the termination of employment in the line of work. What is contemplated in the LIFO rule is that when there are two or more Ees occupying the same position in the company affected by the retrenchment program, the last one employed will necessarily be the first one to go (Maya

Farms Ees‘ Organization v. NLRC, G.R. No. 106256, Dec. 28, 1994).

What is the difference between redundancy and retrenchment? In redundancy, company has no financial problems, unlike in retrenchment where the company will suffer financial losses. What are the requisites of a valid closure? 1.

2.

Note: The losses which the company may suffer or is suffering may be proved by financial statements audited by independent auditors (Asian Alcohol Corporation v. NLRC,

3. 4. 5.

G.R. No. 131108, Mar. 25, 1999)

Retrenchment is a means of last resort. What are the retrenchment? 1.

requisites

of

a

valid

Written notice served on both the Ee and the DOLE at least 1 month prior to the intended date of retrenchment 2. Payment of separation pay equivalent to at least one month pay or at least 1/2 month pay for every year of service, whichever is higher; 3. Good faith; 4. Proof of expected or actual losses; and

Written notice served on both the employees (Ees) and the DOLE at least 1 month prior to the intended date of closure; Payment of separation pay equivalent to at least one month pay or at least 1/2 month pay for every year of service, whichever is higher, except when closure is due to serious business losses; Good faith; No circumvention of the law; and No other option available to the Er.

What is the difference retrenchment? Closure Is the reversal of fortune of the Er whereby there is a

between closure and

Retrenchment Is the reduction of personnel for the purpose of cutting complete cessation of down on costs of business operations to operations in terms of prevent further salaries and wages financial drain upon resorted to by an Er an Er who cannot pay because of losses in anymore his Ees since operation of a business has already business occasioned stopped. by lack of work and

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Compiled by: The Barristers’ Club 2015 considerable reduction in the volume of business. As in the case of retrenchment, however, for the closure of a business or a department due One of the to prerogatives of serious business losses management is the to be regarded as an decision to close the authorized cause for entire establishment terminating Ees, it or to close or abolish must be proven that a department or the losses incurred section thereof for are substantial and economic reasons, actual or reasonably such as to minimize imminent; that the expenses and reduce same increased capitalization. through a period of time; and that the condition of the company is not likely to improve in the near future. Does not obligate the LC provides for the Er for the payment of payment of separation package if separation package in there is closure of case of retrenchment business due to to prevent losses. serious losses. When is disease a ground for dismissal? a) Where the Ee suffers from a disease, and: b) His continued employment is prohibited by law or prejudicial to his health or to the health of his co-Ees (Sec.8, Rule I, Book VI, IRR) c) With a certification by competent public health authority that the disease is incurable within 6 months despite due medication and treatment. (Solis

v. NLRC, GR 28,1996)

No. 116175, Oct.

Note: The req‘t for a medical certification cannot be dispensed with; otherwise, it would sanction the unilateral and arbitrary determination by the Er of the gravity or extent of the Ee‘s illness and thus defeat the public policy on the protection of labor. (Manly Express v Payong, G.R. No.

167462, Oct.25, 2005)

Termination of services for health reasons must be effected only upon

compliance with the above requisites. The requirement for a medical certificate under Art. 284 of the LC cannot be dispensed with; otherwise, it would sanction the unilateral and arbitrary determination by the Er of the gravity or extent of the Ee‘s illness and thus defeat the public policy on the protection of labor. (Sy et. al v. CA, G.R. No. 142293, Feb.

27, 2003)

Discuss the rules on separation pay with regard to each cause of termination. Cause of Termination Pay Separation Equivalent to at least 1 month pay or at least 1 Automation month pay for every year of service, whichever is higher Equivalent to at least 1 month pay or at least 1 Redundancy month pay for every year of service, whichever is higher RetrenchEquivalent to 1 month pay ment or at least ½ month pay for every year or service

Closures or cessation of operation not due to serious business losses/ financial reverses Disease

Equivalent to at least 1 month pay or at least 1 month pay for every year of service (if due to severe financial losses, no separation pay Equivalent month pay month pay of service, higher

to at least 1 or at least ½ for every year whichever is

Note: A fraction of at least 6 months shall be considered 1 whole year. There is no separation pay when the closure is due to an act of the government. 3. Due Process a. Twin-notice requirement 1) Notice which apprises the employee of the particular acts or omissions for which his dismissal is sought; and (2) The subsequent notice which informs the employee of the employer‘s decision to dismiss him (Sec. 13, BP130, Sec. 2-

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Compiled by: The Barristers’ Club 2015 6 Rule XIV, Book V, Rules and Regulations Implementing the Labor Code as amended). Failure to comply with the requirements taints the dismissal with illegality. This procedure is mandatory; in the absence of which, any judgment reached by management is void and inexistent (Tingson, Jr. vs. NLRC, 185 SCRA 498 [1990]; National Service Corp. vs. NLRC, 168 SCRA 122, Ruffy vs. NLRC. 182 SCRA 365 L [1990]). Substantive Due Process Just causes and authorized causes – As mentioned in Article 279, there are two (2) kinds of causes or grounds to terminate employment by employer, to wit: 1. ―Just causes‖ which refer to those instances enumerated under Article 282 [Termination by employer] of the Labor Code. 2. ―Authorized causes‖ which refer to those instances enumerated under Article 283 [Closure of establishment and reduction of personnel] and 284 [Disease as ground for termination] of the Labor Code. Procedural Due Process Two-fold process requirement - The requirement of due process is two-fold, thus: (1) Substantive aspect; and (2) Procedural aspect. Summary of basic due process principles: Termination with just cause but without procedural due process-the dismissal IS UPHELD OR TERMINATION is without procedural due process, there shall be nominal damages to be awarded based on Agabon and Jaka cases (Serrano vs. NLRC et. al., [G. R. No. January 27, 2000 was abandoned by these two cases]). Termination without just cause and due process is illegal. Termination for false or non-existent cause-Employees should be reinstated. In cases where employee was not dismissed but he filed an illegal dismissal case

and failed to prove it—employee should be reinstated and employer should readmit him. No damages, attorney‘s fees or backwages shall be awarded. Quantum of evidence in all termination cases—mere ―substantive evidence‖ their standards of evidence (such as ―proof beyond reasonable doubt‖ or ―preponderance of evidence‖ are not applicable in labor cases). b. Hearing; meaning of opportunity to be heard What is the process to be observed by the employer (Er) for termination of the employment based on any of the just causes for termination? 1. A written notice should be served to the Ee specifying the ground/s for termination and giving the said Ee reasonable opportunity to explain; Note: This first written notice must apprise the Ee that his termination is being considered due to the acts stated in the notice

(Phil. Pizza Inc. v. Bungabong, G.R. No. 154315, May 9, 2005).

2. A hearing or conference should be held during which the Ee concerned, with the assistance of counsel, if the Ee so desires, is given the opportunity to respond to the charge, present his evidence and present the evidence presented against him; and 3. A written notice of termination – If termination is the decision of the Er, it should be served on the Ee indicating that upon due considerations of all the circumstance, grounds have been established to justify his termination, at least one month prior to his termination; Note: Single notice of termination does not comply with the requirements of the law (Aldeguer & Co., Inc. vs. Honeyline

Tomboc, G.R. No. 147633, July 28, 2008). What is the purpose of notice and hearing?

1. The req‘t of notice is intended to inform the Ee concerned of the Er‘s intent to dismiss him and the reason for the proposed dismissal;

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Compiled by: The Barristers’ Club 2015 2. On the other hand the requirement of hearing affords the Ee the opportunity to answer his Er‘s charges against him and accordingly to defend himself there from before dismissal is effected (Salaw v. NLRC

G.R. No. 90786 Sep. 27, 1991).

Note: Failure to comply with the requirement of the 2 notices makes the dismissal illegal. The procedure is mandatory.

(Loadstar Shipping Co. Inc. v. Mesano, G.R. No. 138956, Aug. 7, 2003) When may the required notices be dispensed with? Only in the exceptional case of clear and existing danger to the safety of the crew or vessel that the required notices may be dispensed with, and, once again, records are bereft of evidence showing that such was the situation when Avestruz was dismissed (Maersk-Filipinas Crewing, Inc. vs. Avestruz,

G.R. No. 207010, February 18, 2015).

What is included in the opportunity to be heard? The issue was addressed in an en banc decision rendered by the Supreme Court. With a 14-1 vote the Court through Chief Justice Corona held as follows: a) ―Ample opportunity to be heard‖ in an employee dismissal case means any meaningful opportunity (verbal or written) given to the employee to answer the charges against him or her and submit evidence in support of the defences, whether in a hearing, conference or some other fair, just and reasonable way; b) 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 circumstance justify it; and c) The ―ample opportunity to be heard‖ standard in the Labor Code prevails over the ―hearing or conference‖ requirement in the implementing rules and regulations.

(Perez v. PT&T, G.R. No. 152048, Apr. 7, 2009) C. Reliefs for Illegal Dismissal

1. Reinstatement What is reinstatement? It is the restoration of the employee to the state from which he has been unjustly removed or separated without loss of seniority rights and other privileges. What are the forms of reinstatement? 1. Actual or physical – the employee (Ee) is admitted back to work 2. Payroll – the Ee is merely reinstated in the payroll a. Pending appeal Distinguish Arts. 223 from 279 of the LC Art. 279 Art. 223 May be availed of as Presupposes that the soon as the labor judgment has already arbiter renders a become final and judgment declaring executory. that the dismissal of Consequently, there is the Ee is illegal and nothing left to be ordering said done except the reinstatement. It may execution thereof. be availed of even pending appeal. Note: An award or order for reinstatement is self-executory. It does not require the issuance of a writ of execution.

(Pioneer Texturizing Corp. v. NLRC, G.R. No. 118651, Oct. 16, 1997) b. Separation Reinstatement

Pay

in

Lieu

of

How can separation pay be viewed? Under present laws and jurisprudence, separation pay may be viewed in 4 ways: 1. In lieu of reinstatement in illegal dismissal cases, where Ee is ordered reinstated but reinstatement is not feasible; 2. As Er‘s statutory obligation in cases of legal termination due to authorized causes under Art. 283 and 284 of the LC; 3. As financial assistance, as an act of social justice and even in case of legal dismissal under Art. 282 of the LC; and

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Compiled by: The Barristers’ Club 2015 4. As employment benefit granted in CBA or company policy. (Poquiz, 2005) Is an illegally dismissed employee entitled to reinstatement as a matter of right? General Rule: Yes. Exceptions: Proceeds from an illegal dismissal wherein reinstatement is ordered but cannot be carried out as in the following cases: 1. Reinstatement cannot be effected in view of the long passage of time or because of the realities of the situation. It would be inimical to the employers‘ interest. When reinstatement is no longer feasible; 2. When it will not serve the best interest of the parties involved; 3. Company will be prejudiced by reinstatement; and 4. When it will not serve a prudent purpose; 5. When there is resultant strained relation (applies to both confidential and managerial employees (Ees) only). 6. When the position has been abolished (applies to both managerial, supervisory and rank-and-file Ees). 2. Backwages What are backwages? It is the relief given to an employee (Ee) to compensate him for the lost earnings during the period of his dismissal. It presupposes illegal termination. Note: Entitlement to backwages of the illegally dismissed Ee flows from law. Even if he does not ask for it, it may be given. The failure to claim backwages in the complaint for illegal dismissal is a mere procedural lapse which cannot defeat a right granted under substantive law. What is the period covered by the payment of backwages? 1.

The backwages shall cover the period from the date of dismissal of the employee up to the date of: 2. Actual reinstatement, or if reinstatement is no longer feasible;

3. Finality of judgment awarding backwages (Buhain v. CA, G.R. 143709, July 2, 2002) Note: The backwages to be awarded should not be diminished or reduced by earnings elsewhere during the period of his illegal dismissal. The reason is that the Ee while litigating the illegality of his dismissal must earn a living to support himself and his family.

(Bustamante v. NLRC, G.R. No. 111651, Mar. 15, 1996; Buenviaje v. CA, G.R. No. 147806, Nov. 2002) a. Computation What is included in the computation of backwages? They cover the following: 1. 2. 3.

Transportation and emergency allowances; Vacation or service incentive leave and sick leave; and 13th month pay.

Note: Facilities such as uniforms, shoes, helmets and ponchos should not be included in the computation of backwages because said items are given for free, to be use only during official tour of duty not for private or personal use. The award of backwages is computed on the basis of 30-day month. (JAM Trans Co. v. Flores, G.R. No.L-63555, Mar. 19, 1993) a. Limited backwages D. Preventive Suspension What is preventive suspension? During the pendency of the investigation, the Er may place the Ee under preventive suspension leading to termination when there is an imminent threat or a reasonable possibility of a threat to the lives and properties of the Er, his family and representatives as well as the offender‘s coworkers by the continued service of the Ee. What is the duration of preventive suspension? It should not last for more than 30 days. The Ee should be made to resume his work after 30 days. It can be extended

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Compiled by: The Barristers’ Club 2015 provided the Ee‘s wages are paid after the 30day period. This period is intended only for the purpose of investigating the offense to determine whether he is to be dismissed or not. It is not a penalty. Note: The Er may continue the period of preventive suspension provided that he pays the salary of the Ee. If more than 1 month, the Ee must actually be reinstated or reinstated in the payroll. Officers are liable only if done with malice. E. Constructive Dismissal

14. Recall of workers Exceptions: Otherwise limited by special laws. Note: So long as a company‘s prerogatives are exercised in good faith for the advancement of the Er‘s interest and not for the purpose of defeating or circumventing the rights of the Ees under special laws or under valid agreements, the Supreme Court will uphold them. What are the limitations on management prerogative? The following are the limitations on the exercise of management prerogative:

What is constructive dismissal?

1.) It must be exercised in good faith; 2.) It must not be tainted with unfair labor practice; 3.) The exercise of management prerogative must be within the limitations set by law; 4.) It must also be within the limitations set by the Collective Bargaining Agreement; and 5.) The exercise must be consistent with the principles of fair play and justice.

An involuntary resignation resorted to

when: 1. continued employment becomes impossible, unreasonable, or unlikely; 2. there is a demotion in rank or diminution in pay; or 3. clear discrimination, insensibility or disdain by an Er becomes unbearable to the Ee (Leonardo v. NLRC, G.R.

No.125303, June 16, 2000)

Note: There is no formal dismissal. The Ee is placed in a situation by the Er such that his continued employment has become unbearable. Abandonment is incompatible with constructive dismissal. V. Management Prerogative What is Management Prerogative? General Rule: It is the right of an Er to regulate, according to his own discretion and judgment, all aspects of employment, including: 1. Hiring; 2. Work assignments; 3. Working methods; 4. Time, place and manner of work; 5. Tools to be used; 6. Processes to be followed; 7. Supervision of workers; 8. Working regulations; 9. Transfer of Ees; 10. Work supervision; 11. Lay-off of workers; 12. Discipline; 13. Dismissal; and

Concept of Management Prerogative. Management Prerogative Defined. This refers toan employer's right to freely regulate all aspects of employment through the adoption of strategies or schemes geared toward attaining profit, subject, however, to limitations set by law, the CBA and the principles of fairness and justice and must be effected in good faith and not tainted by unfair labor practice. Supreme Court Rulings On Rights.

Management

a. In NORKIS TRADING CO., INC., ET AL. vs. NATIONAL LABOR RELATIONS COMMISSION, ET AL; G.R. No. 168159, August 19, 2005 the employers are allowed, under the broad concept of management prerogative, to regulate all aspects of personnel administration including hiring, work assignments, working methods, time, place and manner of work, tools to be used, processes to be followed, supervision of workers, working regulations, transfer of employees, work supervision, lay-off of

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Compiled by: The Barristers’ Club 2015 workers, and the dismissal and recall of workers; b. The Supreme Court in Garcia vs. National Labor Relations Commission, 243 SCRA 632, reiterated the existing doctrine that the Constitution also protects management from oppression and destruction in this wise: "(t)he Constitutional policy of providing full protection to labor is not intended to oppress or destroy management xxxx. The unfledging commitment of this Court to the cause of the labor will not prevent Us from sustaining the employer, when itis in the right xxxx." c. In Philippine Geothermal, Inc. vs. The National Labor Relations Commission, 236 SCRA 371, the Supreme Court balanced the conflictinginterests of both labor and management andplaced the parties in relatively equal positions. d. Likewise, in earlier cases, the Court ruled that the law in protecting the rights of the employees does not authorize the oppression nor self-destruction of the employer. It should be made clear that when the law tilts the scales of justice to put the two (2) parties in favor of labor, it is but recognition of the inherent inequality between labor and management. The evident intent is to balance the scale of justice to put the two parties on relatively equal positions. There may be cases where the circumstances warrant favoring labor over the interests of management but never should the scale be so tilted if the result is an injustice to the employer (Justicia nemeni neganda est (Justice is to be denied to none). RELATED SC DECISIONS 1. In a 1996 case, the Supreme Court ruled in Home Owners Savings and Loan Association, Inc. vs. NLRC and Marilyn Cabatbat, G.R No.97067, 26 September 1996, that an "(a)n owner of a business enterprise is given considerable leeway in managing because it is deemed important to society as a whole that he should succeed." Our law, therefore, recognizes certain rights as inherent in the management of business enterprises. These rights are collectively called management prerogatives or acts by which directing the business is able to control the variables thereof, so as to enhance the chances of making a profit. Together, they may taken

as the freedom to administer the affairs of a business enterprise such that the costs of running it would be below the expected earnings or receipts. In short, the elbow room in the quest for profits"(Citing Chu vs. NLRC, 232 SCRA 764 [1994]. 2. The scope of these prerogatives was laid down in a number of cases, one of which was San Miguel Brewery Sales Force Union (PTGWO) vs. Ople, 170 SCRA 25 (1989), where the Court held that "(e)xcept as limited by special laws, an employer is free to regulate, according to his own discretion and judgment, all aspects of employment, including hiring, work assignments, working methods, time, place and manner of work, tools to be used, processes to be followed, supervision of workers, working regulations, transfer of employees, work supervision, layoff of workers and the discipline, dismissal and recall of work." (Based on National Labor Union (NLU) vs. Insular La Yebana Co., 2 SCRA 924, Republic Savings Bank vs. CIR, 21 SCRA 226, 235). 3. As a general rule, it is recognized "that normally it is the prerogative of the employer to transfer and re-assign its employees according to the requirements of its business (Pocketbell Philippines, Inc. vs. NLRC, et. al., G.R. No. 106843, 20 January 1995; Phil. Telegraph and Telephone Co. vs. Laplana, 199 SCRA 485 [1991] ). 4. This same ruling was the Court's position in Interwood Employees Association vs. International Hardwood and Veneer Co. of the Phil., 99 Phil. 82 (1956) and in Yuco Chemical Industries, Inc. vs. MOLE, 185 SCRA 727 (1990), which upheld "the employer's right to transfer its personnel for valid reasons". 5. In Isabelo, et. al., vs. NLRC, G.R. No. 113366-68, 24 July 1997 the Court ruled that it is the employers prerogative, based on its assessment and perception of its employees' qualifications, aptitudes and competence, to move them around in the various areas of its business operations in order to ascertain where they will function at maximum benefit to the cmpany. An employee' right to tenurial security does not give him that vested right as would deprive the company of its prerogative to change his assignment or transfer him where he is most useful.

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6. In Cosico vs. NLRC, G.R. No. 118432, 23 May 1997, the Court recognized the right of management to abolish a position which it deems is no longer necessary and absent any findings of malice and arbitrariness on the part of management, The Court will not efface such privilege if only to protect the person holding that office. Moreover the abolition of the position was seen as a costeffective measure to cut = operational expenses so as not to incur further losses already suffered by the Company's Manila office on account of a low passenger yield. The deletion therefore, of the petitioner's position should be accepted and validated as a valid exercise of management prerogative. 7. For a transfer of an employee not to be considered a constructive dismissal, the employer must be able to show that such transfer is not unreasonable, inconvenient or prejudicial to the employee, nor does it involve a demotion in rank or a diminution of his salaries, privileges and other benefits (Jarcia Machine Shop and Auto Supply, Inc. vs. NLRC and Agapito Tolentino, G.R. No. 118045, 02 January 1997). 8. However, the Court in PT and T vs. Laplana, 199 SCRA 485 (1991), set certain limitations to these rights of management and ruled thus: "(b)ut like all other rights, there are limits. The managerial prerogative to transfer personnel must be exercised without grave abuse of discretion and putting to mind the basic elements of justice and fair play. Having the right the same must be exercised. Thus it cannot be used as a subterfuge by the employer to rid himself of an undesirable worker. Nor than the real reason is to penalize an employee for his union activities and thereby defeat his right to self-organization. But the transfer can be upheld when there is no showing that it is unnecessary, inconvenient and prejudicial to the displaced employee." Limitations to the Exercise of Management Prerogative. (a) In Master Iron Labor Union vs. NLRC, 219 SCRA 47 (1993), the Supreme Court ruled that the hiring, firing, transfer, demotion and promotion of employees, are traditionally identified as management prerogative. However, these prerogatives are not absolute. They are subject to limitations

found in law, a collective bargaining agreement, or general principles of fair play and justice (Similarly ruled in Phil. Airlines, Inc. (PAL) vs. NLRC, G.R. No. 85985, 03 August 1993). (b) In the PAL case, supra, the Supreme Court rendered a ruling on the employee's participation in decision making. Hence, a distinction must be made between management functions regarding business operations per se and those affecting the right of employees. In this regard, management should see to it that its employees be, at least, properly informed of its decisions or modes of action. (c) The Supreme Court in Business Day Information System and Services, Inc. vs. NLRC 221 SCRA 9 (1993), reiterated the limitations in management's exercise of its prerogative, and ruled as "not absolute and must be exercised in good faith" as held in the Master Iron and PAL cases (a and b above). NOTE: If the implementation of the provisions of company rules and policies, the same results in the deprivation of the employees means of livelihood, which in the constitutional sense a property right, the latter right serves as a limitation thereto. Related Cases: 1. Aurelio vs. NLRC et.al. G.R. No. 99034, 14 April 1993. - The prerogative of management to conduct its business affairs to achieve its purpose cannot be denied. Management is at liberty, absent any malice on its part to abolish positions which it deems no longer necessary. 2. Almodiel vs. NLRC, G.R. No. 100641, 14 June 1993. - On the Right to Hire. The determination of the qualification and fitness of the workers for hiring and firing, promotion or reassignment are exclusive prerogative of management. 3. Garcia vs. Manila Times/La Vanguardia Publishing, Inc. and NLRC, G.R. No. 99390, 05 July 1993. - On Discipline As a Management Function. The Court will uphold such management right if exercise in good faith and not for the purpose of defeating the rights of the employees.

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Compiled by: The Barristers’ Club 2015 A. Discipline What is Er‘s right to discipline his Ees? The Er has the prerogative to instill discipline in his Ees and to impose reasonable penalties, including dismissal, on erring Ees pursuant to company rules and regulations.

for the protection of the company‘s property pending investigation of any malfeasance or misfeasance committed by the employee (Consolidated Food Corp. vs. NLRC, 315 SCRA 129). C. Productivity Standard

(San Miguel Corporation v. NLRC, G.R. No. 87277, May 12, 1989)

May an Er impose productivity standards for its workers?

B. Transfer of Employees

Yes. An Er is entitled to impose productivity standards for its workers, and in fact, non-compliance may be visited with a penalty even more severe than demotion. The practice of a company in laying off workers because they failed to make the work quota has been recognized in this jurisdiction. Failure to meet the sales quota assigned to each of them constitute a just cause of their dismissal, regardless of the permanent or probationary status of their employment. Failure to observe prescribed standards of work, or to fulfill reasonable work assignments due to inefficiency may constitute just cause for dismissal. Such inefficiency is understood to mean failure to attain work goals or work quotas, either by failing to complete the same within the allotted reasonable period, or by producing unsatisfactory results. This management prerogative of requiring standards may be availed of so long as they are exercised in good faith for the advancement of the Er‘s interest. (Leonardo vs.

What is the Er‘s right to transfer and reassign Ees? In the pursuit of its legitimate business interests, especially during adverse business conditions, management has the prerogative to transfer or assign Ees from one office or area of operation to another provided there is no demotion in rank or diminution of salary, benefits and other privileges and the action is not motivated by discrimination, bad faith, or effected as a form of punishment or demotion without sufficient cause. This privilege is inherent in the right of Ers to control and manage their enterprises effectively. Note: The right of Ees to security of tenure does not give them vested rights to their positions to the extent of depriving management of its prerogative to change their assignments or to transfer them (Endico v.

Quantum Foods Distribution Center, G.R. No. 161615, Jan. 30, 2009)

As a general rule, the employer has the inherent right to transfer or assign an employee subject only to the condition that it not be motivated by 1) discrimination or 2) bad faith (PT&T vs. Laplana, 199 SCRA 485). An employee‘s right to security of tenure does not give him such vested right in his position as would deprive the company of its prerogative to change his assignment or transfer him. It is the prerogative of management to transfer an employee where he can be most useful to the company (Blue Dairy Corporation vs. NLRC, 314 SCRA 401). Transfer, even if due to promotion, cannot be done without employee‘s consent. Re-assignment pending the administrative investigations of irregularities allegedly committed by an employee falls within the ambit of management prerogative. The purpose is no different from that of preventive suspension which management could validly impose as disciplinary measure

NLRC, G.R. No. 125303, June 16, 2000) D. Grant of Hours What is a bonus?

It is an amount granted and paid to an Ee for his industry and loyalty which contributed to the success of the Ers business and made possible the realization of profits. Can bonus be demanded? General Rule: Bonus is not demandable as a matter of right. It is a management prerogative given in addition to what is ordinarily received by or strictly due to recipient. (Producers Bank

of the Phil. v. NLRC, G.R. No. 100701, March 28, 2001) Exceptions: Given for a long period of time

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Consistent and deliberate – Er continued giving benefit without any condition imposed for its payment; 2. Er knew he was not required to give benefit; 3. Nature of benefit is not dependent on profit; and 4. Made part of the wage or compensation agreed and stated in the employment contract. E. Change of Working Hours What is the Er‘s right to change working hours? Well-settled is the rule that management retains the prerogative, whenever exigencies of the service so require, to change the working hours of its Ees.

What are the factors that the Er must prove inorder to justify BFOQ? The Er must prove 2 factors: 1. That the employment qualification is reasonably related to the essential operation of the job involved; and 2. That there is a factual basis for believing that all or substantially all persons meeting the qualification would be unable to properly perform the duties of the job. (Star

Paper et al. vs. vs. Simbol, G.R. No. 164774, April 12, 2006) G. Post-employment ban

The present article provides that the normal hours of work of an Ee shall not exceed eight (8) hours a day. This implies that the Er, in the exercise of its management prerogatives, may schedule a work shift consisting of less than eight hours. And following the principle of ―a fair day‘s wage for a fair day‘s labor‖, the Er is not obliged to pay an Ee, working for less than eight hours a day, the wages due for eight hours. Nonetheless, if by voluntary practice or policy, the Ee for a considerable period of time has been paying his Ees wages due for eight hours work although the work shift less than eight hours (e.g. seven) it cannot later on increase the working hours without an increase in the pay of the employees affected. An Er is not allowed to withdraw a benefit which he has voluntarily given.

There is a distinction between restrictive covenants barring an Ee to accept a post-employment competitive employment or restraint on trade in employment contracts and restraints on post-retirement competitive employment in pension and retirement plans either incorporated in employment contracts or in collective bargaining agreements between the Er and the union of Ees, or separate from said contracts or collective bargaining agreements which provide that an Ee who accepts post retirement competitive employment will forfeit retirement and other benefits or will be obliged to restitute the same to the employer. The strong weight of authority is that forfeitures for engaging in subsequent competitive employment included in pension and retirement plans are valid even though unrestricted in time or geography. A post-retirement competitive employment restriction is designed to protect the Er against competition by former Ee who may retire and obtain retirement or pension benefits and, at the same time, engage in competitive employment. (Rivera vs. Solidbank, G.R. No.

F. Rules on Marriage between Employees of competitor-employers

VI. Social Welfare Legislation (P.D. 626)

May the normal hours fixed in Article 83 be reduced by the Er?

Is a company policy prohibiting marriage between co-workers valid? There must be a finding of a bona fide occupational qualification (BFOQ) to justify an Er‘s No Spouse Rule. There must be a compelling business necessity for which no alternative exists other than the discriminating practice. (Star Paper vs. Simbol, G.R. No.

163269, April 19, 2006)

A. SSS Law (R.A. No. 8282) 1. Coverage upon:

Coverage in the SSS is compulsory 1.

164774, April 12, 2006)

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All employers engaged in business in the Philippines, including religious, charitable, or non-profit

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Compiled by: The Barristers’ Club 2015 institutions (Sec. 8(c), RA 8282; Roman Catholic Archbishop of Manila v. SSC, 1 SCRA 10);

d. Employees of a foreign government, international organization, or their wholly-owned instrumentality; and e. Temporary employees, which may be excluded by regulation of the Commission (Sec. 8(J), RA 1161 as amended).

2. All employees not over 60 years of age (Sec. 9, RA 8282); 3. Domestic helpers receiving Php1,000.00/month (Sec. 9-A, RA 8282); 4. Aliens employed in the Philippines (Philippine Blooming Mills v. SSS, 17 SCRA 1077); 5. Self-employed persons, including, but not limited to the following: a. All self-employed professionals; b. Partners and single proprietors of businesses; c. Actors and actresses, directors, scriptwriters and news correspondents; d. Professional athletes, coaches, trainers and jockeys; and e. Individual farmers and fishermen (Sec. 9-A, RA 8282). ―The right of an employee to be covered by the SSS is premised on the existence of an employer-employee relationship‖ (Gapayao vs. Fulo. G.R. No. 193493 June 13, 2013). The following may be covered by the SSS on a voluntarily basis:

In the absence of a regulation exempting temporary employees from coverage, temporary employees are covered because there is no way of telling whether or not the said employees belong to a group or class designated by regulation of the Social Security Commission as exempt (LUSTEVECO v. SSS, 16 SCRA 6). 3. Benefits The benefits under the Social Security Act are as follows: a. Monthly Pension; b. Dependent‘s Pension; c. Retirement Benefits; d. Death Benefits and Permanent Disability Benefits; e. Funeral Benefits; f. Maternity Benefits; g. Loan; and h. Sickness Benefits. ―An employee is still entitled to social security benefits even if his employer fails/refuses to remit the contribution to the SSS‖ (Gapayao v. Fulo. G.R. No. 193493 June 13, 20132013).

a. Spouses who devote full time to managing the household and family affairs (Sec. 9(b), RA 8282); and

4. Beneficiaries

b. Filipinos recruited for overseas employment by foreign-based employers (Sec. 9(c), RA 8282).

i. Dependent spouse until he or she remarries; and

2. Exclusions from coverage The Social Security Law does not cover following: a. Purely casual employees; b. Employees serving performed on an alien vessel, when such vessel is outside the Philippines; c. Employees of the Philippine government or any of its instrumentalities or agencies;

a. Primary beneficiaries:

A wife who is already separated de facto from her husband cannot be said to be "dependent for support" upon the husband, absent any showing to the contrary. Conversely, if it is proved that the husband and wife were still living together at the time of his death, it would be safe to presume that she was dependent on the husband for support, unless it is shown that she is capable of providing for herself (SSS v. Aguas. G.R. No. 165546; February 27, 2006).

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Compiled by: The Barristers’ Club 2015 ii. Dependent legitimate, legiti- mated or legally adopted, and illegitimate children.

b) Those who are not receiving basic pay or salary (per diems, honoraria or allowances are excluded); c) members of the judiciary and constitutional commissions. (they are only covered by life insurance); d) Purely casual employees.

b. Secondary beneficiaries: i. Dependent Parents;

The term ―parents‖ in the phrase ―dependent parents‖ is used and ought to be taken in its general sense and cannot be unduly limited to ―legitimate parents‖. Plainly, ―dependent parents‖ are parents, whether legitimate or illegitimate, biological or by adoption, who are in need of support or assistance (Bartolome vs. SSS, G.R. No. 192531, November 12, 2014). ii. Any other person designated by the member as his secondary beneficiary. B. GSIS Law (R.A. No. 8291) 1. Coverage The GSIS covers government employees, irrespective of employment status, who are employed with the: a. national government, its political subdivisions, branches, agencies or instrumentalities; b. government-owned or controlled corporations; c. government financial institutions with original charters; d. constitutional commissions; and e. the judiciary (Sec. 3, RA 8291). Membership is compulsory for all employees: a) Appointee or elective b) whether temporary, counsel, permanent or contractual with employer-employee relationship c) who are receiving basic pay or salary but not per diems, honoraria or allowances, and d) who have not reached the compulsory retirement age of 65 years old 2. Exclusions from coverage The following are excluded from the compulsory membership of the GSIS a) Uniformed members of the AFP and PNP;

3. Benefits The following are the benefits: a. Separation benefits: b. Unemployment or Involuntary Separation Benefits; c. Permanent total disability benefits; d. Permanent partial disability benefits; e. Temporary total disability benefits; f. Retirement benefits; g. Survivorship benefits; h. Funeral benefits; and i. Life insurance benefit. Where the employee retires and meets the eligibility requirements, he acquires a vested right to benefits that is protected by the due process clause. Retirees enjoy a protected property interest whenever they acquire a right to immediate payment under pre-existing law. Thus, a pensioner acquires a vested right to benefits that have become due as provided under the terms of the public employees‘ pension statute. No law can deprive such person of his pension rights without due process of law, that is, without notice and opportunity to be heard (GSIS vs. De Leon. G.R. No. 186560; November 17, 2010). 4. Beneficiaries a. Primary beneficiaries: i. Legal dependent spouse until he or she remarries; and ii. Dependent children. b. Secondary beneficiaries: i. Dependent parents; and ii. Legitimate descendants. C. Limited Portability Law (R.A. No. 7699) 2011 Bar Exam Question: Under the Limited Portability law, funds from the GSIS and the SSS maybe transferred for the benefit of a worker who transfers from one system to the other. For

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of

D. Employee‘s Compensation 1. Coverage The following are covered: a. Every employer shall be covered; b. Every employee over 60 years of age shall be covered if he had been paying contributions to the system prior to age 60 and has not been compulsorily retired; and c. An employee who is coverable by both the GSIS and SSS shall be compulsorily covered by both systems. 2. When compensable It is compensable in the following instances: a. For the injury and the resulting disability or death to be compensable, the injury must be the result of accident arising out of and in the course of the employment; b. For the sickness and the resulting disability or death to be compensable, the sickness must be the result of an occupational disease listed under the Rules with the conditions set therein satisfied, otherwise, proof must be shown that the risk of contracting the disease is increased by the working conditions; c. Only injury or sickness that occurred on or after January 1, 1975 and the resulting disability or death shall be compensable under these Rules.

primary injury is shown to have arisen in the course of employment, every natural consequence that flows from the injury likewise arises out of the employment, unless it is the result of an independent intervening cause attributable to claimant‘s own negligence or misconduct (GSIS v. Calumpiano, G.R. No. 196102, November 26, 2014). Rules on Compensability 1. Direct Premises Rule a. General Rule: The accident of the employee should have occurred at the place of work in order to be compensable. b. Exceptions: (The accident is still compensable even if it occurred outside the work premises) (1) Proximity Rule: When the injury is sustained when the employee is proceeding to or from his work on the premises of the employer, the injury is compensable (Iloilo Dock & Engineering Co. vs. ECC, G.R. No. L-26341, Nov. 27, 1968). (2) Going To or Coming From Work when the injury is sustained when the employee is proceeding to or from his work on the premises of the employer, the injury is compensable.

Under the present law, in order for the employee to be entitled to sickness or death benefits, the claimant must show: (1) that the disability or death is the result of an occupational disease listed under Annex ―A‖ of the ECC Rules with the conditions set therein satisfied; or, (2) that the risk of contracting the disease is increased by the working conditions (Lorenzo v. GSIS. G.R. No. 188385, October 2, 2013). Probability, not certainty, is the test of proof in compensation cases; where the

a. The act of the employee of going to, or coming from, the work place, must have been a continuing act, that is, he had not been diverted therefrom by any other activity and he had not departed from his usual route to, or from, his workplace; and, b. An employee on a special errand must have been official and in connection with his work. c. Extra Premises Rule: The company which provides the means of transportation in going to, or coming from the place of work, is liable to the injury sustained by the employees while on board said means of transportation (Enao v. ECC G.R. No. L-46046, April 5, 1985).

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Compiled by: The Barristers’ Club 2015 d. Special Errand Rule: Injury sustained outside the company premises is compensable if his being out is covered by an office order or a locator slip or a pass for official business. The special errand must be official and in connection to the employee‘s work. e. Dual Purpose Doctrine allows compensation where a special trip would have to be made for the employer if the employee had not combined the service for the employer with his going or coming trip even if in the course of the trip, the employee also pursues a personal purpose. f.

Special Engagement Rule covers field trips, outings, intramurals, and picnics when initiated and sanctioned by the employer.

g. Positional and Local Risks Doctrine: If an employee by reason of his duties is exposed to a special or peculiar danger from the elements, that is, one greater than that to which other persons in the community are exposed and an unexpected injury occurs, the injury is compensable 2. 24 Hour Duty Doctrine ―The 24 Hour Duty Doctrine‖ applies to both policemen and firemen. The policemen and firemen are technically on duty 24 hours a day except when they are on vacation leave, they may be ―on-call‖ anytime. However, to be compensable, the injury should be caused by an activity which is police or firemen services in character (reasonable connection between the injury and the work or service) (Hinoguin v. ECC, G.R. No. 84307, April 17, 1989). The 24-hour duty doctrine should not be sweepingly applied to all acts and circumstances causing the death of a police officer but only to those which, although not on official line of duty, are nonetheless basically police service in character (GSIS vs. Court of Appeals, G.R. No. 128524, April 20, 1999).

VII. Labor Relations Law A. Right to self-organization 1. Who may unionize for purposes of collective bargaining? All persons employed in commercial, industrial and agricultural enterprises in an religious, charitable, medical or education institutions, whether operating for profit not, shall have the right to self-organizations of their own choosing for purposes of collective bargaining. Ambulant, intermittent and itinerant workers, self-employed people, rural workers and those without any definite employers may form labor organizations for their mutual aid and protection. Right to organize of employees in the public service: Employees of government corporations established under the Corporation Code shall have the right to organized and to bargain collectively with their respective employers. All other employees in the civil case shall have the right to form associations for purposes not contrary to law. Article 212(g) of the Labor Code defines a labor organization as ―any union or association of employees which exists in whole or in part for the purpose of collective bargaining or of dealing with employers concerning terms and conditions of employment.‖ Upon compliance with all the documentary requirements, the Regional Office or Bureau shall issue in favor of the applicant labor organization a certificate indicating that it is included in the roster of legitimate labor organizations. Any applicant labor organization shall acquire legal personality and shall be entitled to the rights and privileges granted by law to legitimate labor organizations upon issuance of the certificate of registration (Sta. Lucia East Commercial Corporation vs. Hon. Secretary of Labor and Employment, et al., G.R. No. 162355, August 14, 2009). Three (3) categories of employees: 1. Managerial employees (recently classified into: top management and middle management); 2. Supervisory management (classified as first-time management); and

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Compiled by: The Barristers’ Club 2015 3. Rank and file employees. Who cannot form, join or assist labor organizations? Managerial employees are not allowed to join any labor organization. Supervisory employees are allowed to join a supervisory union but the union of rank-and-file employees. The principle distinction between managerial employees and supervisory employees is: the former have the power to decide and do managerial acts: while the latter have the power only to recommend managerial acts such as laying down policy, or dismissal of employees and the like. Separation of Union Doctrine The affiliation of both t6he rank-andfile union and supervisory union in the same company with one and the same federation is not allowed if the rank-and-file employees are under the direct supervision of the supervisors composing the supervisory union. If not, said affiliation with one and the same federation allowed. NOTE: This is now allowed under the amendments to the Code. Confidential Employee Rule Confidential employees are not allowed to join any union (as they are treated like managers) when they: (1) assist or act in and (2) to persons who and effectuate specifically in relations.

confidential capacity; formulate, determine, management policies the field of labor

Otherwise, if this two conditions do not concur, they can join a union. Security Guards: Present rule is security guards may join rank-and-file or supervisory union, depending on their rank or position. Although Article 245 of the Labor Code limits the ineligibility to join, form and assist any labor organization to managerial employees, jurisprudence has extended this prohibition to confidential employees. The

positions of Human Resource Assistant and Assistant belong to the category of confidential employees and, hence, are excluded from the bargaining unit, considering their respective positions and job descriptions. As Human Resource Assistant, the scope of one‘s work necessarily involves labor relations, recruitment and selection of employees, access to employees‘ personal files and compensation package, and human resource management. As regards a Personnel Assistant, one‘s work includes the recording of minutes for management during collective bargaining negotiations, assistance to management during grievance meetings and administrative investigations, and securing legal advice for labor issues from the petitioner‘s team of lawyers, and implementation of company programs. Therefore, in the discharge of their functions, both gain access to vital labor relations information which outrightly disqualifies them from union membership (San Miguel Foods, Inc. vs. San Miguel Corp. Supervisors and Exempt Union, G.R. No. 146206. August 1, 2011). Prohibition against aliens General Rule: All aliens, natural or judicial, as well as foreign organizations are strictly prohibited from engaging directly or indirectly in all forms of trade union activities without prejudice to normal contacts between Philippine labor unions and recognized internat6ional labor centers. Exceptions: Alien Employees with valid working permit issued by the DOLE may exercise the right to self-organizations for purposes of collective bargaining, if they are nationals of country which grants the same or similar rights to Filipino workers, as certified by the Department of Foreign Affairs. 2. Bargaining unit It refers to a group of employees sharing mutual interests within a given employer unit, comprised of all or less than all of the entire body of employees in the employer unit or any specific occupational and geographical grouping within such employer unit. A ―bargaining unit‖ is the group or cluster of jobs or positions that supports the labor organization which applying for

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Compiled by: The Barristers’ Club 2015 registration, establishment.

within

the

employer‘s

A bargaining unit is a ―group of employees of a given employer, comprised of all or less than all of the entire body of employees, consistent with equity to the employer, indicated to be the best suited to serve the reciprocal rights and duties of the parties under the collective bargaining provisions of the law.‖ (Sta. Lucia East Commercial Corporation vs. Hon. Secretary of Labor and Employment, et al., G.R. No. 162355, August 14, 2009). a) Test to determine the constituency of an appropriate bargaining unit The fundamental factors in determining the appropriate collective bargaining unit are: (1) the will of the employees (Globe Doctrine); (2) affinity and unity of the employees‘ interest, such as substantial similarity of work and duties, or similarity of compensation and working conditions (Substantial Mutual Interests Rule); (3) prior collective bargaining history; and (4) similarity of employment status (Sta. Lucia East Commercial Corporation vs. Hon. Secretary of Labor and Employment, et al., G.R. No. 162355, August 14, 2009). b) Voluntary recognition Voluntary recognition of bargaining agent is the free and voluntary act of the employer of extending and conferring full recognition to a union as the sole and exclusive bargaining representative of the employees in the appropriate bargaining unit, for purposes of collective bargaining. This is allowed when there is only one union operating in the bargaining unit. (i) Requirements No specific criteria but the following may be used: 1. Substantial mutual interests principle or Community or mutuality of interests rule ; 2. Globe doctrine (will of the employees); 3. Collective bargaining history; and

4. Employment status. c) Certification election It refers to the process of determining through secret ballot sole the sole and exclusive bargaining representative of the employees in an appropriate bargaining unit, for purposes of collective bargaining. (i) In an unorganized establishment (ii) In an organized establishment Requisites for a certification organized establishments:

election

in

1. that a petition questioning the majority status of the incumbent bargaining agent is filed before the DOLE within 60-day freedom period; 2. that such petition is verified; and 3. that the petition is supported by the written consent of at least twenty-five 4. (25%) of all employees in the bargaining unit. Note: In unorganized establishments, certification election shall be ―automatically‖ conducted upon the filing of a petition for certification election by a legitimate labor organization. Who may file a petition for certification election? A certification for certification election may filed by: 1. a legitimate labor organization; or 2. a dederation or national union in behalf of a local or chapter 3. as employer, only when requested by a labor organization to bargain collectively and the status of the union is in doubt. When to file petition for certification election? General Rule: In the absence of a collective bargaining agreement duly registered in accordance with Article 231 of the Labor Code, a petition for certification election may be filed at any time.

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Compiled by: The Barristers’ Club 2015 Exceptions:

vi. when the collective bargaining agreement was entered into prior to the 60-day freedom period; vii. when there is a mass defection or schism in the union resulting in an industrial dispute wherein the collective bargaining agreement can no longer foster industrial peace.

However, no certification election may held under the following rules: 1. certification year—bar rule; 2. bargaining deadclock-bar rule; or 3. contract-bar rule. 4. Consent election bar 1. Certification year-bar rule – Under this rule, a certification election petition may not be filed within one (1) year: (1) from date of a valid certification, consent or run-off election; or (2) from the date of voluntary recognition. 2. Bargaining deadclock-bar rule – Neither a representation questioned be entertained if: a. Before the filing of the petition for certification election, the duly recognized or certified union has commenced negotiations with the employer within one-year period from the date of a valid certification, consent or run-off election or from the date voluntary recognition; or b. A. bargaining deadclock to which an incumbent or certified bargaining agent is a party had been submitted to a conciliation or arbitration or had become the subject of a valid notice of strike or lockout. c. Contract-bar rule.- The Bureau of Labor Relations shall not entertain any petition for certification election or any other action which may disturb the administration of duly registered existing collective bargaining agreements affecting the parties. Exceptions to the contract-bar rule. i. during the 60—day period; ii. when the CBA, is not registered with the BIR or DOLE Regional Offices; iii. when the CBA, although registered, contains provisions lower than the standards fixed by law; iv. when the documents supporting its registration are falsified, fraudulent or tainted with misrepresentation; v. when the collective bargaining agreement is not complete as it does not contain any of the requisite provisions which the law requires;

Appeal in certification election cases: To the DOLE Secretary within 10 days from receipt of the decision NOTE: In an unorganized establishment, if the petition is granted, there is no appeal thereto. It is well‐settled that under the ―double majority rule‖ for there to be a valid certification election, majority of the bargaining unit must have voted and the winning union must have garnered majority of the valid votes cast. Following the ruling that all the probationary employees‘ votes should be deemed valid votes while that of the supervisory Ees should be excluded, it follows that the number of valid votes cast would increase. Under Art. 256 of the LC, the union obtaining the majority of the valid votes cast by the eligible voters shall be certified as the sole exclusive bargaining agent of all the workers in the appropriate bargaining unit. This majority is 50% + 1 (NUWHRAIN ‐ MPHC v. SLE. G.R. No. 181531, July 31, 2009). The general rule is that an employer has no standing to question the process of certification election, since this is the sole concern of the workers. Law and policy demand that employers take a strict, hands-off stance in certification elections. The bargaining representative of employees should be chosen free from any extraneous influence of management. The only exception is where the employer itself has to file the petition pursuant to Article 258 of the Labor Code because of a request to bargain collectively (San Miguel Foods, Inc. vs. San Miguel Corp. Supervisors and Exempt Union. G.R. No. 146206. August 1, 2011). The choice of their representative is the exclusive concern of the employees; the employer cannot have any partisan interest therein; it cannot interfere with, much less

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Compiled by: The Barristers’ Club 2015 oppose, the process by filing a motion to dismiss or an appeal from it; not even the allegation that some employees participating in a petition for certification election are actually managerial employees will give an employer legal personality to block the certification election. The employer‘s only right in the proceeding is to be notified or informed thereof (Samahang Manggagawa sa Charter Chemical Solidarity of Unions in the Philippines for Empowerment and Reforms [SMCC-SUPER], Zacarrias Jerry Victorio – Union President v. Charter Chemical and Coating Corporation G.R. No. 169717, March 16, 2011).

(i) Requirements e) Re-run election

The pendency of a petition for cancellation of union registration does not preclude collective bargaining, and that an order to hold a certification election is proper despite the pendency of the petition for cancellation of the union‘s registration because at the time the respondent union filed its petition, it still had the legal personality to perform such act absent an order cancelling its registration. The legitimacy of the legal personality of respondent cannot be collaterally attacked in a petition for certification election proceeding but only through a separate action instituted particularly for the purpose of assailing it. The Implementing Rules stipulate that a labor organization shall be deemed registered and vested with legal personality on the date of issuance of its certificate of registration. Once a certificate of registration is issued to a union, its legal personality cannot be subject to a collateral attack. It may be questioned only in an independent petition for cancellation in accordance with Section 5 of Rule V, Book V of the Implementing Rules (Legend International Resorts Limited v. Kilusang Manggagawa ng Legenda. G.R. No. 169754, February 23, 2011).

It refers to the election voluntarily agreed upon by the parties, with or without the intervention of the of the Department of Labor and Employment, to determine the issue of majority representation of all the workers in the appropriate collective bargaining unit.

d) Run-off election It refers to an election between the receiving the two (2) highest number of votes when a certification election which provides for three (3) more choices res4lts in no choice receiving a majority of the valid votes cast; provided, that the total number of votes for all contending unions is at least fifty percent 50% union of the number of votes cast.

Re-run is held in two instances: 1) if one receives a plurality of vote and the remaining choices results in a tie; 2) if all choices received the same number of votes; while Run-off takes place between the unions who received the two highest number of votes where not one of the unions obtained the majority of the valid votes cast, provided the total union votes is at least 50% of the votes cast. f) Consent election

g) Affiliation and disaffiliation of the local union from the mother union A local union may disaffiliate at any time from its mother federation, absent any showing that the same is prohibited under its constitution or rules. Such disaffiliation, however, does not result in it losing its legal personality. A local union does not owe its existence to the federation with which it is affiliated. It is a separate and distinct voluntary association owing its creation to the will of its members. The mere act of affiliation does not divest the local union of its own personality, neither does it give the mother federation the license to act independently of the local union. It only gives rise to a contract of agency where the former acts in representation of the latter. In the present case, whether the FFW went against the will of its principal (the memberemployees) by pursuing the case despite the signing of the MOA, is not for the Court, nor for respondent employer to determine, but for the Union and FFW to resolve on their own pursuant to their principal-agent relationship. Moreover, the issue of disaffiliation is an intraunion dispute which must be resolved in a different forum in an action at the instance of either or both the FFW and the union or a rival labor organization, but not the employer as in this case (Cirtek Employees Labor UnionFederation of Free workers vs. Cirtek

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Compiled by: The Barristers’ Club 2015 Electronics, Inc., G.R. No. 190515. June 6, 2011). Under the LC and the rules, the power granted to LOs to directly create a chapter or local through chartering is given to a federation or national union only, not to a trade union center (SMCEU v. San Miguel Packaging Products Ees Union G.R. No. 171153, Sep. 12, 2007). (i) Substitutionary doctrine The Er cannot revoke the validly executed CB contract with their Er by the simple expedient of changing their bargaining agent. The new agent must respect the contract. It cannot be invoked to support the contention that a newly certified CB agent automatically assumes all the personal undertakings of the former agent‐like the ―no strike clause‖ in the CBA executed by the latter (Benguet Consolidated Inc. v. BCI Ees and Worker‘s Union‐PAFLU. G.R. No. L‐24711, April 1968). h) Union dues and special assessments (i) Requirements for validity It shall invalidate the questioned special assessments. Substantial compliance of the requirements is not enough in view of the fact that the special assessment will diminish the compensation of union members. i) Agency fees Palacol v. Ferrer‐ Calleja G.R. No. 85333, Feb. 26, 1990). i) Agency fees (ii) Requisites for assessment B. Right to collective bargaining Jurisdictional preconditions in collective bargaining : 1. Possession of the status of majority representation of the employees representative in accordance with any of the means of selection or designation provided for the Labor Code 2. Proof of majority representation 3. A demand to bargain under Art. 250 (a) of the LC.( Kiok Loy v. NLRC. G.R. No. L‐ 54334, Jan.22, 1986)

1. Duty to bargain collectively a) When there is absence of a CBA b) When there is a CBA When there is a collective bargaining agreement, the duty to bargain collectively shall also mean that neither party shall terminate or modify such agreement during its lifetime. However, either party can serve a written notice to terminate or modify the agreement at least sixty (60) days prior to its expiration date. It shall be the duty of both parties to keep the status quo and to continue in full force and effect the terms and conditions of the existing agreement during the 60-day period and/or until a new agreement is reached by the parties. This is no different from a bargaining representative‘s perseverance to include one that they deem of absolute necessity. Indeed, an adamant insistence on a bargaining position to the point where the negotiations reach an impasse does not establish bad faith. Obviously, the purpose of CB is the reaching of an agreement resulting in a contract binding on the parties; but the failure to reach an agreement after negotiations have continued for a reasonable period does not establish a lack of good faith. The statutes invite and contemplate a collective bargaining contract, but they do not compel one. The duty to bargain does not include the obligation to reach an agreement. While the law makes it an obligation for the Er and the Ees to bargain collectively with each other, such compulsion does not include the commitment to precipitately accept or agree to the proposals of the other. All it contemplates is that both parties should approach the negotiation with an open mind and make reasonable effort to reach a common ground of agreement (Union of Filipro Ees v. Nestle Phils. G.R. Nos. 158930‐31, Mar. 3, 2008). 2.

Collective Bargaining Agreement (CBA)

It refers to the negotiated contract between a legitimate labor organization and the employer concerning wages, hours of work and all other terms and conditions of employment in a bargaining unit. The CBA is deemed the law between the parties during its lifetime. Itys provisions are construed liberally.

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Compiled by: The Barristers’ Club 2015     

 

A proposal not embodied in CBA is not part thereof. Minutes of CBA negotiation-no effect if its contents are not incorporated in the CBA. Making a promise during the CBA negotiation is not considered bad faith. Adamant stance resulting in impasse, not bad faith. The DOLE Secretary cannot order inclusion of terms and conditions in CBA which the law and the parties did not intend reflect therein. Signing bonus, not demandable under the law. Allegations of bad faith, wiped out with signing of CBA.

As regular employees, petitioners fall within the coverage of the bargaining unit and are therefore entitled to CBA benefits as a matter of law and contract. Under the terms of the CBA, petitioners are members of the appropriate bargaining unit because they are regular rank-and-file employees and do not belong to any of the excluded categories. Most importantly, the labor arbiter‘s decision of January 17, 2002 – affirmed all the way to the CA – ruled against the company‘s submission that they are independent contractors. Thus, as regular rank-and-file employees, they fall within the CBA coverage. And, under the CBA‘s express terms, they are entitled to its benefits. CBA coverage is not only a question of fact, but of law and contract. The factual issue is whether the petitioners are regular rank-and-file employees of the company. The tribunals below uniformly answered this question in the affirmative. From this factual finding flows the legal effects which are touching on the terms and conditions of the petitioners‘ regular employment Farley Fulache, et al. vs. ABS-CBN Broadcasting Corporation, G.R. No. 183810, January 21, 2010).

settlement at the plant level as provided in the collective bargaining agreement. It is usually consists of successive steps starting at the level of the complainant and his immediate supervisor and ending, when necessary, at the level of the top union and company officials. All grievances submitted to the grievance machinery which are not settled within seven (7) calendar days from the date of their submission shall automatically be referred to voluntary arbitration prescribed in the CBA. For this purpose, parties to a CBA shall name and designate in advance a Voluntary Arbitrators, or include n the agreement a procedure for the selection of such Voluntary Arbitrators or panel of Voluntary Arbitrators, preferably from the listing of qualified Voluntary Arbitrators duly accredited by the NCMB. In case the parties fail to select a Voluntary Arbitrator or panel of Voluntary Arbitrators, the NCMB shall designate the Voluntary Arbitrator or panel of Voluntary Arbitrators, as may be necessary, pursuant to the selection procedure agreed upon in the CBA, which shall act with the same force and effect as if the Arbitrator or panel of Arbitrators has been selected by the parties as described above.

a) Mandatory provisions of CBA (i) Grievance procedure ―Grievance procedure‖ refers to the internal rules of procedure established by the parties in their CBA with voluntary arbitration as the 6terminal step, which are intended to resolve all issue arising from the implementation and interpretation of their CBA. It is refers to the system of grievance



Role of Sole Bargaining Agent.- It is the representative of all employees of purposes of collective bargaining. However, an individual employee group of employees shall have the right at any time to present grievances to their employer.



Participation of workers in policy and decision-making processes.- Workers shall have the right participate in policy and decision-making processes of the establishment where they are employed insofar as said processes will directly affect their rights, benefits, and welfare. For this purpose, workers and employers may form labormanagement councils: Provided, That the representatives of the workers in such labor-management councils shall be elected by at least the majority of all employees in said establishment.

CBA is the law or contract between the parties. Article 13.1 of the CBA entered into by

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Compiled by: The Barristers’ Club 2015 and between respondent GCI and AMOSUP provides that the Company and the Union agree that in case of dispute or conflict in the interpretation or application of any of the provisions of this Agreement, or enforcement of Company policies, the same shall be settled through negotiation, conciliation or voluntary arbitration (Dulay vs. Aboitiz Jebsen Maritime, Inc. and General Charterers, Inc. G.R. No. 172642, June 13, 2012). (ii) Voluntary arbitration Article 217 of the Labor Code states that unfair labor practices and termination disputes fall within the original and exclusive jurisdiction of the Labor Arbiter. As an exception, under Article 262 the Voluntary Arbitrator, upon agreement of the parties, shall also hear and decide all other labor disputes including unfair labor practices and bargaining deadlocks. For the exception to apply, there must be agreement between the parties clearly conferring jurisdiction to the voluntary arbitrator. Such agreement may be stipulated in a collective bargaining agreement. However, in the absence of a collective bargaining agreement, it is enough that there is evidence on record showing the parties have agreed to resort to voluntary arbitration (The University of the Immaculate Conception, et al. vs. NLRC, et al., G.R. No. 181146, January 26, 2011). (iii) No strike-no lockout clause The ―no strike‐no lockout‖ clause in the CBA applies only to economic strikes. It does not apply to ULP strikes. Hence, if the strike is founded on an unfair labor practice of the employer, a strike declared by the union cannot be considered a violation of the no strike clause (Master Iron Labor Union v. NLRC. G.R. No. 92009, Feb. 17, 1993). Note (Poquiz): A strike can be waived under this clause. (iv) Labor management council b) Duration Terms of a CBA: Representation aspect (sole exclusive status of certified union)

The term and condition is 5 years which means that no petition questioning the majority status of the incumbent bargaining agent shall be entertained by DOLE and no certification election shall be conducted outside of the 60-day freedom period. All other provisions (which refer to both economic and non-economic provisions except representation) Shall be renegotiated not later that three (3) years after its execution. Article 253 of the Labor Code mandates the parties to keep the status quo and to continue in full force and effect the terms and conditions of the existing agreement during the 60-day period prior to the expiration of the old CBA and/or until a new agreement is reached by the parties. The law does not provide for any exception nor qualification on which economic provisions of the existing agreement are to retain its force and effect. Likewise, the law does not distinguish between a CBA duly agreed upon by the parties and an imposed CBA. The provisions of the imposed CBA continues to have full force and effect until a new CBA is entered into by the parties (General Milling Corporation-Independent Labor Union [GMCILU] vs. General Milling Corporation G.R. Nos. 183122/183889, June 15, 2011) While the parties may agree to extend the CBA‘s original five-year term together with all other CBA provisions, any such amendment or term in excess of five years will not carry with it a change in the union‘s exclusive collective bargaining status. By express provision of the above-quoted Article 253-A, the exclusive bargaining status cannot go beyond five years and the representation status is a legal matter not for the workplace parties to agree upon. In other words, despite an agreement for a CBA with a life of more than five years, either as an original provision or by amendment, the bargaining union‘s exclusive bargaining status is effective only for five years and can be challenged within sixty (60) days prior to the expiration of the CBA‘s first five years ( FVC Labor Union-Philippine Transport and General Workers Organization (FVCLUPTGWO) Vs. Sama-samang Nagkakaisang Manggagawa sa FVC-Solidarity of Independent and General Labor Organization (SANAMA-

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Compiled by: The Barristers’ Club 2015 FVC-SIGLO. G.R. No. 176249, November 27, 2009)

4. Unfair bargaining

(i) For economic provisions (ii) For non-economic provisions (iii) Freedom period

Labor

Practice

in

collective

a) Bargaining in bad faith b) Refusal to bargain c) Individual bargaining d) Blue sky bargaining e) Surface bargaining

Freedom period The last sixty (60) days of the lifetime of a collective bargaining agreement immediately prior to its expiration is called the ―freedom period‖. It is so called because it is only the time when the law allows the parties to serve notice to terminate, alter or modify the existing agreement. It is also the time when the majority status of the bargaining union or agent may be challenged by another union appropriate petition for certification election. Automatic renewal clause At the time of the freedom period, the employer shall continue to recognize the majority status of the incumbent bargaining agent where not petition for certification election is filed. 3. Union Security ―Union for Security Clause‖ is a stipulation in the CBA whereby the management recognizes, that the membership of employees in the union which negotiated said should be maintained and continued as a condition for employment or retention of employment. The obvious purpose is to safeguard and ensure the continued existence of the union. a) Union security clauses; closed shop, union shop, maintenance of membership shop, etc. Classification: (1) Closed shop agreement; (2) Maintenance of membership agreement; (3) Union shop agreement; (4) Modified union shop agreement; (5) Exclusive bargaining agreement; (6) Bargaining for members only agreement; (7) Agency shop agreement; (8) Preferential hiring agreement. b) Check-off; union dues, agency fees

5. Unfair Labor Practice (ULP) a) Nature of ULP It violates the right of workers to selforganization, is inimical to the legitimate interest of both labor and management, including their right to bargain collective and otherwise deal with each other in an atmosphere of freedom and mutual respect, disrupts industrial peace and hinders the promotion of healthy and stable labormanagement relations. Before an employer or labor organization, as they can be, may be said to have committed unfair practices acts, the following ingredients must both concur: 1. there should exist an employeremployee relationship between the offended party and the offender; and 2. the act complained must be expressly mentioned and defined in the labor code as constitutive and unfair labor practice. If not mentioned, there is no ULP. Absent one of the elements aforementioned will not make the act an unfair labor practice act. Anent the charge of unfair labor practice, Article 248 (a) of the Labor Code considers it an unfair labor practice when an employer interferes, restrains or coerces employees in the exercise of their right to selforganization or the right to form an association. In order to show that the employer committed unfair labor practice under the Labor Code, substantial evidence is required to support the claim. Substantial evidence has been defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. In the case at bar, respondents were indeed unceremoniously dismissed from work by reason of their intent to form and organize a

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Compiled by: The Barristers’ Club 2015 union (Park Hotel, et al. vs. Manolo Soriano, et al. G.R. No. 171118. September 10, 2012). Unfair labor practice refers to acts that violate the workers‘ right to organize. The prohibited acts are related to the workers‘ right to self-organization and to the observance of a CBA. Thus, an employer may be held liable for unfair labor practice only if it can be shown that his acts interfere with his employees‘ right to self-organization. Since there is no showing that the respondent company‘s implementation of the Right-Sizing Program was motivated by ill will, bad faith or malice, or that it was aimed at interfering with its employees‘ right to self-organization, there is no unfair labor practice to speak of in this case (Nelson A. Culili v. Eastern Telecommunications Philippines, Inc., et al. G.R. No. 165381, February 9, 2011). b) ULP of employers i. ii.

iii.

iv.

v.

To interfere with, restrain or coerce employees in the exercise of their right to self organization; To require as a condition of employment that a person or an employee shall not join labor organization or shall withdraw from one to which he belongs; To contract out services or functions being performed by union when such will interfere with, restrain coerce employees in the exercise of their rights to self—organizations; To initiate, dominate, assist or otherwise interfere with the formation or administration of any labor organization, including the giving of financial or other support to it or its organizers or supporters; To discriminate in regard to wages, hours of work and other terms and conditions of employment in order to encourage or discourage membership in any labor organization. Nothing in this Code or in any other law shall stop the parties in requiring membership in a recognized collective bargaining agent as a condition for employment, except those employees who are already members of another union at the time of the signing of the collective bargaining agreement. Employees of an appropriate bargaining unit who are not already

vi.

vii. viii.

ix.

members of the recognized collective bargaining agent may be assessed a reasonable fee equivalent to the dues and other fees paid by members of the recognized collective bargaining agent,, if such non-union members accept the benefits under the collective bargaining agreement: Provided, that the individual authorization required under Article 242, paragraph (0) of this shall not apply to the nonmembers of the recognized collective bargaining agent. To dismiss, discharge or other wise prejudice or discriminate against an employee for having given or being about to give testimony under this Code; To violate the duty to bargain collectively as prescribed by this Code; To pay negotiation or attorney‘s fees to the union or its officers or agents as part of the settlement of any issue in collective bargaining or any other dispute; or To violate a collective bargaining agreement.

The provisions preceding paragraph notwithstanding, only the officers and agents of corporations, associations or partnership who have actually participated in, authorized or ratified unfair labor practices shall be held criminally liable. Totality of Conduct of Doctrine Expressions of opinion by an employer, may be held to be constitutive of unfair labor practice because of the circumstances under which they were uttered, the history of the particular employer‘s labor relations or anti-union bias or because of their connection with an established collateral plan of coercion or interference. An expression which might be permissibly uttered by one employer, might, in the mouth of more hostile employer, be deemed improper and consequently actionable as an unfair labor practice. c) ULP of labor organizations i.

To restrain or coerce employees in the exercise of their right to selforganization. However, a labor organization shall have the right to

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ii.

iii.

iv.

v.

vi.

prescribe its own rules with respect to the acquisition or retention of membership. To cause or attempt an employer to discriminate against an employee with respect to whom membership in such organizations has been denied or terminate an employee on any other than the usual terms and conditions under which membership or continuation of membership is made available to other members. To violate the duty, or refuse to bargain collectively with the employer, provided it is the representative of the employees. To cause or attempt to cause an employer to pay or deliver or agree to pay or deliver any money or other things of value, in the nature of an exaction, for services which are not performed or not to be performed, including the demand for fee for union negotiations; To ask for or accept negotiations or attorney‘s fees from part of the settlement of any issue in collective bargaining or any other dispute; or To violate collective bargaining agreement.

The provisions of the preceding paragraph notwithstanding, only the officers, members of governing boards, representatives or agents or members of labor associations or organizations who have actually participated in, authorized or ratified unfair labor practices shall be held criminally liable. C. Right to peaceful concerted activities 1. Forms of concerted activities 2. Who may declare a strike or lockout? NAMA-MCCH-NFL is not a legitimate labor organization, thus, the strike staged by its leaders and members was declared illegal. (Visayas Community Medical Center (VCMC) formerly known as Metro Cebu Commnunity Hospital (MCCH) v. Erma Yballe, et al., G.R. No. 196156, January 15, 2014). 3. Requisites for a valid strike or lockout: First requisite: Valid and final factual ground

a. Valid grounds: (1) CBA Deadlock; and (2) ULP b. No other grounds are allowed except the two mentioned above. Second requisite: Notice of strike or notice of lockout a. When to file notice: ULP: 15 days strike/lockout

from

intended

date

of

CBA Deadlock: 30 days from the intended date thereof a. Parties who may file notice: Any certification union, in case of strike; and employer in case of lockout. b. Where to file notice-NCMB Third requisite: Strike vote or lockout vote a. Majority approval of strike or lockout is required b. Strike vote still necessary even in case of union-busting. Fourth requisite: Strike vote report or lockout vote report a. When to submit strike or lockout vote report-at lest seven (7) days prior to strike lockout, as the case may be. b. Effect of none-submission of strike vote NCMB, DOLE-strike or lockout is illegal c. Effect on seven-day waiting period if filed within cooling-off period. d. Strike vote report in case of unionbusting-still necessary, it being mandatory unlike the cooling-off period which may be dispensed with. Fifth requisite: Cooling off-period a. General rule: CBA Deadlock-30 days; ULP: 15 days b. Exceptions in the case of unionbusting: Cooling-off period need not be complied with. c. When Cooling-off periods startsfrom the time the notice of strike/lockout is filed with NCMB, DOLE. Sixth requisite: 7-day waiting period or strike ban

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Compiled by: The Barristers’ Club 2015 a. Cooling-off period and waiting and waiting period distinguished. Waiting period is counted from the time of submission of strike vote report to NCMB; Cooling-off period is counted from the filing of Notice of Strike/Lockout with NCMB. b. Purpose of the seven-day waiting period- To ensure that the strike votes vote was indeed taken and that the majority approved of it. c. Deficiency of even one-day of the seven-day strike ban (or coolingoff period) is fatal. Hence, the strike is illegal. Article 263 of the Labor Code, as amended by Republic Act (R.A.) No. 6715, and Rule XXII, Book V of the Omnibus Rules Implementing the Labor Code outline the following procedural requirements for a valid strike: 1) A notice of strike, with the required contents, should be filed with the DOLE, specifically the Regional Branch of the NCMB, copy furnished the employer of the union; 2) A cooling-off period must be observed between the filing of notice and the actual execution of the strike thirty (30) days in case of bargaining deadlock and fifteen (15) days in case of unfair labor practice. However, in the case of union busting where the union‘s existence is threatened, the cooling-off period need not be observed. xxx xxx xxx 3) Before a strike is actually commenced, a strike vote should be taken by secret balloting, with a 24-hour prior notice to NCMB. The decision to declare a strike requires the secretballot approval of majority of the total union membership in the bargaining unit concerned. 4) The result of the strike vote should be reported to the NCMB at least seven (7) days before the intended strike or lockout, subject to the cooling-off period. It is settled that these requirements are mandatory in nature and failure to comply therewith renders the strike illegal.

The requisites for a valid strike are: (Hotel Enterprises of the Philippines, Inc., etc. vs. Samahan ng mga Manggagawa sa HyattNational Union of Workers in the Hotel Restaurant, etc., G.R. No. 165756, June 5, 2009). (a) a notice of strike filed with the DOLE 30 days before the intended date thereof or 15 days in case of ULP; (b) a strike vote approved by a majority of the total union membership in the bargaining unit concerned obtained by secret ballot in a meeting called for that purpose; and (c) a notice to the DOLE of the results of the voting at least seven (7) days before the intended strike. The requirements are mandatory and failure of a union to comply therewith renders the strike illegal 4. Requisites for lawful picketing To strike is to withhold or to stop work by the concerted action of employees as a result of an industrial or labor dispute. The work stoppage may be accompanied by picketing by the striking employees outside of the company compound. While a strike focuses on stoppage of work, picketing focuses on publicizing the labor dispute and its incidents to inform the public of what is happening in the company struck against. A picket simply means to march to and from the employer‘s premises, usually accompanied by the display of placards and other signs making known the facts involved in a labor dispute. It is a strike activity separate and different from the actual stoppage of work (PHIMCO Industries, Inc. v. PHIMCO Industries Labor Association (PILA), et al, G.R. No. 170830, August 11, 2010). 5. Assumption of jurisdiction by the DOLE Secretary or Certification of the labor dispute to the NLRC for compulsory arbitration The assumption of jurisdiction powers granted to the Labor Secretary under Article 263(g) is not limited to the grounds cited in the notice of strike or lockout that may have preceded the strike or lockout; nor is it limited to the incidents of the strike or lockout that in the meanwhile may have taken place. As the term ―assume jurisdiction‖ connotes, the intent of the law is to give the Labor Secretary full

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Compiled by: The Barristers’ Club 2015 authority to resolve all matters within the dispute that gave rise to or which arose out of the strike or lockout, including cases over which the labor arbiter has exclusive jurisdiction. (Bagong Pagkakaisa ng Manggagawa ng Triumph International, et al. vs. Secretary of Department of Labor and Employment, et al./Triumph International (phils.), Inc. vs. Bagong Pagkakaisa ng Manggagawa ng Triumph International, et al., G.R. No. 167401, July 5, 2010).

4. When it employs unlawful means in the pursuit of its objective, such as a widespread terrorism of non-strikers [for example, prohibited acts under Art. 264(e) of the Labor Code]; or

7. Nature of assumption order or certification order

6. When it is contrary to an existing agreement, such as a no-strike clause or conclusive arbitration clause.(Toyota v Toyota Workers Association. G.R. Nos. 158786 & 158789 October 19, 2007).

8. Effect of defiance of assumption or certification orders Under Article 264 (a) of the Labor Code, as amended, a strike that is undertaken despite the issuance by the Secretary of Labor of an assumption order and/or certification is illegal. So is a declaration of a strike during the pendency of cases involving the same grounds for the strike. In the present case, there is no dispute that when respondents conducted their mass actions on April 3 to 6, 2000, the proceedings before the Secretary of Labor were still pending as both parties filed motions for reconsideration of the March 24, 2000 Order. Clearly, respondents knowingly violated the aforesaid provision by holding a strike in the guise of mass demonstration (Solid Bank Corp. Ernesto U. Gamier, et al. and Solid Bank Corp., et al. vs. Solid Bank Union and its Dismissed Officers and Members, et al. G.R. No. 159460 and G.R. No. 159461, November 15, 2010). 9. Illegal strike The Supreme Court also cited the 6 categories of illegal strikes which are: 1. When it is contrary to a specific prohibition of law, such as strike by employees performing governmental functions; or 2. When it violates a specific requirement of law, [such as Article 263 of the Labor Code on the requisites of a valid strike]; or 3. When it is declared for an unlawful purpose, such as inducing the employer to commit an unfair labor practice against nonunion employees; or

5. When it is declared in violation of an existing injunction, [such as injunction, prohibition, or order issued by the DOLE Secretary and the NLRC under Art. 263 of the Labor Code]; or

A strike may be regarded as invalid although the labor union has complied with the strict requirements for staging one as provided in Article 263 of the Labor Code when the same is held contrary to an existing agreement, such as a no strike clause or conclusive arbitration clause. Here, the CBA between the parties contained a ―no strike, no lockout‖ provision that enjoined both the Union and the Company from resorting to the use of economic weapons available to them under the law and to instead take recourse to voluntary arbitration in settling their disputes. No law or public policy prohibits the Union and the Company from mutually waiving their respective right to strike and lockout, which are otherwise available to them under the law, in favor of voluntary arbitration (C. Alcantara & Sons, Inc. vs. Court of Appeals / Nagkahiusang Mamumuno sa Alsons-SPFL (NAMAAL-SPFL), et al. vs. C. Alcantara & Sons, Inc. G.R. No. 155109/G.R. No. 155135/G.R. No. 179220, September 29, 2010). The petitioners were charged with conducting an illegal strike, not a mass leave, without specifying the exact acts that the company considers as constituting an illegal strike or violative of company policies. Such allegation falls short of the requirement in King of Kings Transport, Inc. of ―a detailed narration of the facts and circumstances that will serve as basis for the charge against the employees.‖ A bare mention of an ―illegal strike‖ will not suffice. Further, while Biomedica cites the provisions of the company policy which petitioners purportedly violated, it failed to quote said provisions in the notice so petitioners can be adequately informed of

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Compiled by: The Barristers’ Club 2015 the nature of the charges against them and intelligently file their explanation and defenses to said accusations (Alex Q. Naranjo, et al. vs. Biomedica Health Care, Inc., et al. G.R. No. 193789. September 19, 2012). a) Liability of union officers The law makes a distinction between union members and union officers. A union member who merely participates in an illegal strike may not be terminated from employment. It is only when he commits illegal acts during a strike that he may be declared to have lost employment status. In contrast, a union officer may be terminated from employment for knowingly participating in an illegal strike or participates in the commission of illegal acts during a strike. The law grants the employer the option of declaring a union officer who participated in an illegal strike as having lost his employment. It possesses the right and prerogative to terminate the union officers from service (Visayas Community Medical Center (VCMC) formerly known as Metro Cebu Commnunity Hospital (MCCH) v. Erma Yballe, et al., G.R. No. 196156, January 15, 2014). b) Liability of ordinary workers A distinction exists between the ordinary workers‘ liability for illegal strike and that of the union officers who participated in it. The ordinary worker cannot be terminated for merely participating in the strike. There must be proof that he committed illegal acts during its conduct. On the other hand, a union officer can be terminated upon mere proof that he knowingly participated in the illegal strike. Moreover, the participating union officers have to be properly identified. In the present case, with respect to those union officers whose identity and participation in the strike having been properly established, the termination was legal (Yolito Fadriquelan, et al. vs. Monterey Foods Corporation/Monterey Foods Corporation v. Bukluran ng mga Manggagawa sa Monterey-ILAW, et al., G.R. No. 178409/G.R. No. 178434, June 8, 2011) As a general rule, when just causes for terminating the services of an employee exist, the employee is not entitled to separation pay because lawbreakers should not benefit from their illegal acts. The rule, however, is subject to exceptions. Here, not only did the Court

declare the strike illegal, rather, it also found the Union officers to have knowingly participated in the illegal strike. Worse, the Union members committed prohibited acts during the strike. Thus, as the Court has concluded in other cases it has previously decided, such Union officers are not entitled to the award of separation pay in the form of financial assistance (C. Alcantara & Sons, Inc. vs. Court of Appeals, G.R. No. 155109/G.R. No. 155135/G.R. No. 179220. March 14, 2012). Since the Union‘s strike has been declared illegal, the Union officers can be terminated from employment for their actions. This includes the shop stewards who cannot be shielded from the coverage of Article 264 of the Labor Code since the Union appointed them as such and placed them in positions of leadership and power over the men in their work units. As regards the rank and file Union members, Article 264 provides that termination from employment is not warranted by the mere fact that a union member has taken part in an illegal strike. It must be shown that such union member, clearly identified, performed an illegal act or acts during the strike. The striking Union members allegedly committed the following prohibited acts: a. They threatened, coerced, and intimidated non-striking employees, officers, suppliers and customers; b. They obstructed the free ingress to and egress from the company premises; and c. They resisted and defied the implementation of the writ of preliminary injunction issued against the strikers. The mere fact that the criminal complaints against them were subsequently dismissed does not extinguish their liability under the Labor Code. Nor does such dismissal bar the admission of the affidavits, documents, and photos presented to establish their identity and guilt during the hearing of the petition to declare the strike illegal (C. Alcantara & Sons, Inc. vs. Court of Appeals / Nagkahiusang Mamumuno sa Alsons-SPFL (NAMAAL-SPFL), et al. vs. C. Alcantara & Sons, Inc. G.R. No. 155109/G.R. No. 155135/G.R. No. 179220, September 29, 2010).

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Compiled by: The Barristers’ Club 2015 c) Liability of employer

Tire & Rubber v. CA, G.R. 128632, Aug. 5, 1999).

d) Waiver of illegality of strike When management and union are in pari delicto, the contending parties must be brought back to their respective positions before the controversy; that is, before the strike. In this case, management‘s fault arose from the fact that a day after the union filed a petition for certification election before the DOLE, it hit back by requiring all its employees to undergo a compulsory drug test. Indeed, the timing of the drug test was suspicious. Moreover, management engaged in a runaway shop when it began pulling out machines from the main building (AER building) to the compound (AER-PSC premises) located on another street on the pretext that the main building was undergoing renovation. On the other hand, like management, the union and the affected workers were also at fault for resorting to a concerted work slowdown and walking out of their jobs in protest of their illegal suspension. It was also wrong for them to have forced their way to the AER-PSC premises to try to bring out the boring machines. Adding to the injury was the fact that the picketing employees prevented the entry and exit of non-participating employees and possibly AER‘s clients to the premises. Thus, the Supreme Court affirmed the ruling of the Court of Appeals favoring the reinstatement of all the complaining employees, including those who tested positive for illegal drugs, without backwages (Automotive Engine Rebuilders, Inc. et al. v. Progresibong Unyon ng mga Manggagawa sa AERG.R. No. 160138/G.R. No. 160192. July 13, 2011). 10. Injunctions a) Requisites for labor injunctions b) ―Innocent bystander rule‖ The innocent by stander must show: 1. Compliance with the grounds specified in Rule 58 of the Rules of Court, and 2. That it is entirely different from, without any connection whatsoever to, either party to the dispute and, therefore, its interests are totally foreign to the context thereof (MSF

A party, by filing its 3rd party claim with the deputy sheriff, it submitted itself to the jurisdiction of the NLRC acting through the LA. The broad powers granted to the LA and to the NLRC by Art. 217, 218 and 224 of the LC can only be interpreted as vesting in them jurisdiction over incidents arising from, in connection with or relating to labor disputes, as the controversy under consideration, to the exclusion of the regular courts. The RTC, being a co‐equal body of the NLRC, has no jurisdiction to issue any restraining order or injunction to enjoin the execution of any decision of the latter (Deltaventures v. Cabato. G.R. No. 118216, Mar. 9, 2000). VIII. Procedure and Jurisdiction A. Labor Arbiter 1. Jurisdiction Original and Exclusive Jurisdiction over the following: 1. Unfair Labor practices; 2. Termination disputes; 3. Cases that workers may file involving wages, rates of pay, hours of work and other terms and conditions of employment, if accompanied with claim for reinstatement; 4. Claims for actual, moral, exemplary and other forms of damages arising from the from the employer—employee relations; 5. Cases arising from any violation of Article 264 of this Code, including questions involving the legality of strikes and lockouts; and 6. Except claims for Employees‘ Compensation, Social Security, Medicare and maternity benefits, all other claims arising from employer—employee relations, including those of persons in domestic or household service, involving an amount exceeding five thousand pesos (P5, 000.00) regardless of whether accompanied with a claim for reinstatement. The jurisdiction of labor arbiters, as well as of the NLRC, is limited to disputes arising from an employer-employee relationship which can only be resolved by

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Compiled by: The Barristers’ Club 2015 reference to the Labor Code, other labor statutes, or their collective bargaining agreement. U-Bix's complaint was one to collect sum of money based on civil laws – on obligations and contract, not to enforce rights under the Labor Code, other labor statutes, or the collective bargaining agreement (U-Bix Corporation, et al. vs. Valerie Anne H. Hollero. G.R. No. 177647, October 31, 2008). a) versus Regional Director 2. Reinstatement pending appeal The spirit of the rule on reinstatement pending appeal animates the proceedings once the Labor Arbiter issues the decision containing an order of reinstatement. The immediacy of its execution needs no further elaboration. Reinstatement pending appeal necessitates its immediate execution during the pendency of the appeal, if the law is to serve its noble purpose. At the same time, any attempt on the part of the employer to evade or delay its execution should not be countenanced. After the labor arbiter‘s decision is reversed by a higher tribunal, the employee may be barred from collecting the accrued wages, if it is shown that the delay in enforcing the reinstatement pending appeal was without fault on the part of the employer (Juanito A. Garcia and Alberto Dumago v. PAL. G.R No. 164856, January 20, 2009). 3. Requirements to perfect appeal to NLRC a. requisites to perfect Evident it is from the foregoing that an appeal from rulings of the Labor Arbiter to the NLRC must be perfected within ten (10) calendar days from receipt thereof, otherwise the same shall become final and executory. In a judgment involving a monetary award, the appeal shall be perfected only upon (1) proof of payment of the required appeal fee and (2) posting of a cash or surety bond issued by a reputable bonding company and (3) filing of a memorandum of appeal. A mere notice of appeal without complying with the other requisites mentioned shall not stop the running of the period for perfection of appeal (Stolt Nielsen Marine Services Inc. (now Stolt-Nielsen Transportation Group Inc.) vs. NLRC. G.R. No. 147623,December 13, 2005).

b. when there is substantial compliance There was substantial compliance with the NLRC Rules of Procedure when the respondents PAL Maritime Corporation and Western Shipping Agencies, Pte., Ltd. filed, albeit belatedly, the Joint Declaration Under Oath, which is required when an employer appeals from the Labor Arbiter‘s decision granting a monetary award and posts a surety bond. Under the NLRC rules, the following requisites are required to perfect the employer‘s appeal: (1) it must be filed within the reglementary period; (2) it must be under oath, with proof of payment of the required appeal fee and the posting of a cash or surety bond; and (3) it must be accompanied by typewritten or printed copies of the memorandum of appeal, stating the grounds relied upon, the supporting arguments, the reliefs prayed for, and a statement of the date of receipt of the appealed decision, with proof of service on the other party of said appeal. If the employer posts a surety bond, the NLRC rules further require the submission by the employer, his or her counsel, and the bonding company of a joint declaration under oath attesting that the surety bond posted is genuine and that it shall be in effect until the final disposition of the case. In the case at bar, the respondents posted a surety bond equivalent to the monetary award and filed the notice of appeal and the appeal memorandum within the reglementary period. When the NLRC subsequently directed the filing of a Joint Declaration Under Oath, the respondents immediately complied with the said order. There was only a late submission of the Joint Declaration. Considering that there was substantial compliance with the rules, the same may be liberally construed. The application of technical rules may be relaxed in labor cases to serve the demands of substantial justice (Rolando L. Cervantes vs. PAL Maritime Corporation and/or Western Shipping Agencies. G.R. No. 175209. January 16, 2013). c. completeness of service by registered mail The Supreme Court also overruled the respondents‘ contention that UE filed its appeal to the NLRC beyond the required ten (10)-day period. For completeness of service by registered mail, the reckoning period starts either from the date of actual receipt of the

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Compiled by: The Barristers’ Club 2015 mail by the addressee or after five (5) days from the date he or she received the first notice from the postmaster. In this case, the respondents averred that, on March 17, 2005, the postmaster gave UE‘s counsel a notice to claim the mail containing the Labor Arbiter‘s decision. The respondents claimed that UE‘s counsel was deemed in receipt of the decision 5 days after the giving of the notice, or on March 22, 2005. Thus, according to the respondents, when UE filed its appeal to the NLRC on April 14, 2005, the 10-day reglementary period had already lapsed. The Supreme Court, however, ruled that there must be conclusive proof that the registry notice was received by or at least served on the addressee. In this case, the records did not show that UE‘s counsel in fact received the alleged registry notice requiring him to claim the mail. On the other hand, UE was able to present a registry return receipt showing that its counsel actually received a copy of the Labor Arbiter‘s decision on April 4, 2005. Reckoned from this date, the 10-day reglementary period had not yet lapsed when UE filed its appeal to the NLRC on April 14, 2005. (University of the East, et al. v. Analiza F. Pepanio and Mariti D. Bueno. G.R No. 193897, January 23, 2013). d. bond i. Filing of bond, jurisdictional Paragraph 2, Article 223 of the Labor Code provides that ―[i]n case of a judgment involving a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly accredited by the NLRC in the amount equivalent to the monetary award in the judgment appealed from.‖ Contrary to the respondents‘ claim, the issue of the appeal bond‘s validity may be raised for the first time on appeal since its proper filing is a jurisdictional requirement. The requirement that the appeal bond should be issued by an accredited bonding company is mandatory and jurisdictional. The rationale of requiring an appeal bond is to discourage the employers from using an appeal to delay or evade the employees‘ just and lawful claims. It is intended to assure the workers that they will receive the money judgment in their favor if the employer‘s appeal is dismissed (Wilgen Loon, et al. v. Power Master, Inc., et al. G.R. No. 189404, December 11, 2013).

ii. Revocation of bond, prospective application The respondents filed a surety bond issued by Security Pacific Assurance Corporation (Security Pacific) on June 28, 2002. At that time, Security Pacific was still an accredited bonding company. However, the NLRC revoked its accreditation on February 16, 2003. This subsequent revocation should not prejudice the respondents who relied in good faith on the then subsisting accreditation of Security Pacific. In Del Rosario v. Philippine Journalists, Inc. it was held that a bonding company‘s revocation of authority is prospective in application. Nonetheless, the respondents should post a new bond issued by an accredited bonding company in compliance with paragraph 4, Section 6, Rule 6 of the NLRC Rules of Procedure, which states that ―[a] cash or surety bond shall be valid and effective from the date of deposit or posting, until the case is finally decided, resolved or terminated or the award satisfied (Wilgen Loon, et al. v. Power Master, Inc., et al., G.R. No. 189404, December 11, 2013). iii. What constitutes amount‖; the Mcburnie Rule

―reasonable

To ensure the provisions of Section 6, Rule VI of the NLRC Rules that give parties the chance to seek a reduction of the appeal bond are effectively carried out, without however defeating the benefits of the bond requirement in favor of a winning litigant, all motions to reduce bond that are filed with the NLRC shall be accompanied by the posting of a cash or surety bond equivalent to 10% of the monetary award that is subject of the appeal, which shall provisionally be deemed the reasonable amount of the bond in the meantime that an appellant‘s motion is pending resolution by the Commission. Only after the posting of a bond in the required percentage shall an appellant‘s period to perfect an appeal under the NLRC Rules be deemed suspended. The percentage of the bond that is set by this guideline is merely provisional. The NLRC retains its authority and duty to resolve the motion and determine the final amount of bond that shall be posted by the appellant, still in accordance with the standards of ―meritorious grounds‖ and ―reasonable amount‖.

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Compiled by: The Barristers’ Club 2015 Should the NLRC after considering the motion‘s merit, determine that a greater amount or the full amount of the bond needs to be posted by the appellant, then the party shall comply accordingly. The appellant shall be given a period of 10 days from notice of the NLRC order within which to perfect the appeal by posting the required appeal bond. (Andrew Mcburnie v. Eulalio Ganzon. GR Nos. 178034, 178117 and GR No. 186984-85, 2013).

decide all disciplinary action cases and other special cases administrative in character involving such workers. The obvious intent of Republic Act No. 8042 was to have the POEA focus its efforts in resolving all administrative matters affecting and involving such workers. The NLRC had no appellate jurisdiction to review the decision of the POEA in disciplinary cases involving overseas contract workers (Eastern Mediterranean Maritime Ltd., et al. vs. Estanislao Surio, et al. G.R. No. 154213, August 23, 2012).

B. National (NLRC)

The NLRC acquires jurisdiction over parties in cases before it either by summons served on them or by their voluntary appearance before its Labor Arbiter. Here, while the Union insists that summons were not properly served on the impleaded Union members with respect to the Company‘s amended petition that sought to declare the strike illegal, the records show that they were so served. The Return of Service of Summons indicated that 74 out of the 81 impleaded Union members were served with summons. But they refused either to accept the summons or to acknowledge receipt of the same. Such refusal cannot of course frustrate the NLRC‘s acquisition of jurisdiction over them. Besides, the affected Union members voluntarily entered their appearance in the case when they sought affirmative relief in the course of the proceedings like an award of damages in their favor (C. ALCANTARA & SONS, INC. v. COURT OF APPEALS, et al.G.R. No. 155109, G.R. No. 155135, G.R. No. 179220, September 29, 2010).

Labor Relations Commission

1. Jurisdiction a. Exclusive and Original Jurisdiction: i. Certified cases –cases certified to it for compulsory arbitration by the Secretary of Labor under Art. 269, or the President under Art. 270; ii. Injunction cases –under Arts. 224 and 270; iii. Contempt cases; and iv. Verified petition. b. Exclusive Appellate: i. Cases decided by Labor Arbiters under Art. 223 of the Labor Code and Sec. 10, RA 8042 (Migrant Worker‘s Act); and ii. Cases decided by the Regional Offices of DOLE in the exercise of its adjudicatory function under Art. 129 of the Labor Code over monetary claims of workers amounting to not more than Php5,000.00. The NLRC has jurisdiction to determine, preliminarily, the parties‘ rights over a property when it is necessary to determine an issue related to rights or claims arising from an employer-employee relationship (Milan et al. vs. NLRC, G.R. No. 202961, February 4, 2015). Although Republic Act No. 8042, through its Section 10, transferred the original and exclusive jurisdiction to hear and decide money claims involving overseas Filipino workers from the POEA to the Labor Arbiters, the law did not remove from the POEA the original and exclusive jurisdiction to hear and

2. Effect of NLRC reversal of Labor Arbiter‘s order of reinstatement 3. Remedies 4. Certified cases C. Bureau of Labor Relations – Med-Arbiters 1. Jurisdiction (original and appellate) D. National Conciliation and Mediation Board 1. Nature of proceedings 2. Conciliation vs. Mediation 3. Preventive mediation E. DOLE Regional Directors 1. Jurisdiction

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Labor Law

Compiled by: The Barristers’ Club 2015 F. DOLE Secretary 1. Visitorial and enforcement powers 2. Power to suspend/effects of termination 3. Assumption of jurisdiction 4. Appellate jurisdiction 5. Voluntary arbitration powers G. Grievance Machinery and Voluntary Arbitration 1. Subject matter of grievance 2. Voluntary Arbitrator a) Jurisdiction b) Procedure c) Remedies H. Court of Appeals 1. Rule 65, Rules of Court I. Supreme Court 1. Rule 45, Rules of Court General rule: It is a settled rule in this jurisdiction that only questions of law are allowed in a petition for review on certiorari. The Court‘s power of review in a Rule 45 petition is limited to resolving matters pertaining to any perceived legal errors, which the CA may have committed in issuing the assailed decision. In reviewing the legal correctness of the CA‘s Rule 65 decision in a labor case, the Court examines the CA decision in the context that it determined whether or not there is grave abuse of discretion in the NLRC decision subject of its review and not on the basis of whether the NLRC decision on the merits of the case was correct (Universal Robina Sugar Milling Corporation v. Ferdinand Acibo. GR No. 186439, January 15, 2014). Exception: The Court‘s jurisdiction in cases brought before it from the CA via Rule 45 of the Rules of Court is generally limited to reviewing errors of law. The Court is not the proper venue to consider a factual issue as it is not a trier of facts. This rule, however, is not ironclad and a departure therefrom may be warranted where the findings of fact of the CA are contrary to the findings and conclusions of the NLRC and LA, as in this case. In this regard, there is therefore a need to review the records to determine which of them should be preferred as more conformable to evidentiary facts (INC Shipmanagement, Inc. et al. v

Alexander L. Moradas. GR No. 178564, January 15, 2014). While generally, only questions of law can be raised in a petition for review on certiorari under Rule 45 of the Rules of Court, the rule admits of certain exceptions, namely: (1) when the findings are grounded entirely on speculations, surmises, or conjectures; (2) when the inference made is manifestly mistaken, absurd, or impossible; (3) when there is a grave abuse of discretion; (4) when the judgment is based on misappreciation of facts; (5) when the findings of fact are conflicting; (6) when in making its findings, the same are contrary to the admissions of both appellant and appellee; (7) when the findings are contrary to those of the trial court; (8) when the findings are conclusions without citation of specific evidence on which they are based; (9) when the facts set forth in the petition as well as in the petitioner‘s main and reply briefs are not disputed by the respondent; and (10) when the findings of fact are premised on the supposed absence of evidence and contradicted by the evidence on record. The illegality of petitioner‘s dismissal was an issue that was squarely raised before the NLRC. When the NLRC decision was reversed by the Court of Appeals, there was a situation where ―the findings of facts are conflicting‖. The petition for review filed by the Petitioner comes within the purview of exception (5) and by analogy, exception (7) (Mylene Carvajal vs. Luzon Development Bank and/or Oscar Z. Ramirez. G.R. No. 186169, August 1, 2012). As a general rule, the Supreme Court is not a trier of facts and a petition for review on certiorari under Rule 45 of the Rules of Court must exclusively raise questions of law. Moreover, if factual findings of the National Labor Relations Commission and the Labor Arbiter have been affirmed by the Court of Appeals, the Supreme Court accords them the respect and finality they deserve. It is wellsettled and oft-repeated that findings of fact of administrative agencies and quasi-judicial bodies, which have acquired expertise because their jurisdiction is confined to specific matters, are generally accorded not only respect, but finality when affirmed by the Court of Appeals. Nevertheless, the Supreme Court will not hesitate to deviate from what are clearly procedural guidelines and disturb and strike down the findings of the Court of Appeals and

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Green Notes 2015

Labor Law

Compiled by: The Barristers’ Club 2015 those of the labor tribunals if there is a showing that they are unsupported by the evidence on record or there was a patent misappreciation of facts. Indeed, that the impugned decision of the Court of Appeals is consistent with the findings of the labor tribunals does not per se conclusively demonstrate the correctness thereof. By way of exception to the general rule, the Supreme Court will scrutinize the facts if only to rectify the prejudice and injustice resulting from an incorrect assessment of the evidence presented (Timoteo H. Sarona vs. National Labor Relations Commission, Royale Security Agency, et al., G.R. No. 185280, January 18, 2011). J. Prescription of actions The day the action may be brought is the day a claim starts as a legal possibility. In the present case, January 1, 2000 was the date that respondent Pingol was not allowed to perform his usual and regular job as a maintenance technician. He, however only filed the complaint for constructive dismissal and monetary claims four years later or on March 29, 2004. As correctly held by the LA, complainant's cause of action has already prescribed. Respondent's contention that the prescriptive period was interrupted when he made follow-ups is also untenable. Like other causes of action, the prescriptive period for money claims is subject to interruption, and in the absence of an equivalent Labor Code provision for determining whether the said period may be interrupted, Art. 1155 provides that the prescription of an action is interrupted by (a) the filing of an action, (b) written extrajudicial demand by the creditor, and (c) a written acknowledgment of the debt by the debtor. In this case, respondent Pingol never made any written extrajudicial demand. Neither did petitioner make any written acknowledgment of its alleged obligation. Thus, the claimed "follow-ups" could not have validly tolled the running of the prescriptive period. It is worthy to note that respondent never presented any proof to substantiate his allegation of follow-ups. (Philippine Long Distance Telephone Company v. Roberto Pingol. GR No. 182622, September 8, 2010).

reflected in his payslips, hence, it is assumed that he learned of it at the time he received his monthly paychecks. As thus correctly ruled by both the NLRC and the appellate court, only those illegal deductions made from 1997 to 1999 when he was dismissed can be claimed, he having filed his complaint only in February 2000. Per his own computation and as properly adopted by the NLRC in its assailed Resolution dated March 10, 2004, petitioner is thus entitled to reimbursement of P88,000.00. To properly construe Article 291 of the Labor Code, it is essential to ascertain the time when the third element of a cause of action transpired. Stated differently, in the computation of the three-year prescriptive period, a determination must be made as to the period when the act constituting a violation of the workers‘ right to the benefits being claimed was committed. For if the cause of action accrued more than three (3) years before the filing of the money claim, said cause of action has already prescribed in accordance with Article 291 ( Virgilio Anabe v. Asian Construction. GR No. 183233, December 23, 2009).

In the present case, the day came when petitioner learned of Asiakonstrukt‘s deduction from his salary of the amount of advances he had received but had, by his claim, been settled, the same having been

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