Labor Law

LABOR LAW

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Labor Standards FUNDAMENTAL PRINCIPLES & POLICIES CONSTITUTIONAL PROVISIONS Article ii, secs. 9, 10, 11, 13, 14, 18, 20. Section 9. The State shall promote a just and dynamic social order that will ensure the prosperity and independence of the nation and free the people from poverty through policies that provide adequate social services, promote full employment, a rising standard of living, and an improved quality of life for all. Section 10. The State shall promote social justice in all phases of national development. Section 11. The State values the dignity of every human person and guarantees full respect for human rights. Section 13. 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. Section 14. The State recognizes the role of women in nation-building, and shall ensure the fundamental equality before the law of women and men. Section 18. The State affirms labor as a primary social economic force. It shall protect the rights of workers and promote their welfare. Section 20. The State recognizes the indispensable role of the private sector, encourages private enterprise, and provides incentives to needed investments.

Article iii, secs. 1, 4, 8.

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Section 1. 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. Section 4. 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. Section 8. The right of the people, including those employed in the public and private sectors, to form unions, associations, or societies for purposes not contrary to law shall not be abridged.

Art. Xiii, secs. 1, 2, 3, 13, 14. Section 1. The Congress shall give highest priority to the enactment of measures that protect and enhance the right of all the people to human dignity, reduce social, economic, and political inequalities, and remove cultural inequities by equitably diffusing wealth and political power for the common good. To this end, the State shall regulate the acquisition, ownership, use, and disposition of property and its increments. Section 2. The promotion of social justice shall include the commitment to create economic opportunities based on freedom of initiative and self-reliance. Section 3. The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all. It shall guarantee the rights of all workers to self-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.

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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.

Article 1702

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.

LABOR CODE

Section 13. 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. Section 14. 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.

CIVIL CODE Article 19 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.

Article 1700 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.

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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.

Article 3 Art. 3. Declaration of basic policy. The State shall afford protection to labor, promote full employment, ensure equal work opportunities regardless of sex, race or creed and regulate the relations between workers and employers. The State shall assure the rights of workers to selforganization, collective bargaining, security of tenure, and just and humane conditions of work.

Article 4 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

Article 172 Art. 172. Policy. The State shall promote and develop a tax-exempt employees’ compensation program whereby employees and their dependents, in the event of workconnected disability or death, may promptly secure adequate income benefit and medical related benefits.

Article 217 Art. 217. Declaration of Policy. (a) It is the policy of the State: (a) To promote and emphasize the primacy of free collective bargaining and negotiations, including voluntary arbitration, mediation and conciliation, as modes of settling labor or industrial disputes; (b) To promote free trade unionism as an instrument for the enhancement of democracy and the promotion of social justice and development; (c) To foster the free and voluntary organization of a strong and united labor movement;

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(d) To promote the enlightenment of workers concerning their rights and obligations as union members and as employees; (e) To provide an adequate administrative machinery for the expeditious settlement of labor or industrial disputes; (f) To ensure a stable but dynamic and just industrial peace; and To ensure the participation of workers in decision and policy-making processes affecting their rights, duties and welfare To encourage a truly democratic method of regulating the relations between the employers and employees by means of agreements freely entered into through collective bargaining, no court or administrative agency or official shall have the power to set or fix wages, rates of pay, hours of work or other terms and conditions of employment, except as otherwise provided under this Code. (As amended by Section 3, Republic Act No. 6715, March 21, 1989)

Article 218 Art. 218. Definitions. (a) "Commission" means the National Labor Relations Commission or any of its divisions, as the case may be, as provided under this Code. (b) "Bureau" means the Bureau of Labor Relations and/or the Labor Relations Divisions in the regional offices established under Presidential Decree No. 1, in the Department of Labor. (c) "Board" means the National Conciliation and Mediation Board established under Executive Order No. 126. (d) "Council" means the Tripartite Voluntary Arbitration Advisory Council established under Executive Order No. 126, as amended. (e) "Employer" includes any person acting in the interest of an employer, directly or indirectly. The term shall not include any labor organization or any of its officers or agents except when acting as employer. (f) "Employee" includes any person in the employ of an employer. The term shall not be limited to the employees of a particular employer, unless the Code so explicitly states. It shall include any individual whose work has ceased as a result of or in

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connection with any current labor dispute or because of any unfair labor practice if he has not obtained any other substantially equivalent and regular employment. (g) "Labor organization" means any union or association of employees which exists in whole or in part for the purpose of collective bargaining or of dealing with employers concerning terms and conditions of employment. (h) "Legitimate labor organization" means any labor organization duly registered with the Department of Labor and Employment, and includes any branch or local thereof. (i) "Company union" means any labor organization whose formation, function or administration has been assisted by any act defined as unfair labor practice by this Code. (j) "Bargaining representative" means a legitimate labor organization whether or not employed by the employer. (k) "Unfair labor practice" means any unfair labor practice as expressly defined by the Code. (l) "Labor dispute" includes any controversy or matter concerning terms and conditions of employment or the association or representation of persons in negotiating, fixing, maintaining, changing or arranging the terms and conditions of employment, regardless of whether the disputants stand in the proximate relation of employer and employee. (m) "Managerial employee" is one who is vested with the powers or prerogatives to lay down and execute management policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees. Supervisory employees are those who, in the interest of the employer, effectively recommend such managerial actions if the exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment. All employees not falling within any of the above definitions are considered rank-andfile employees for purposes of this Book. (n) "Voluntary Arbitrator" means any person accredited by the Board as such or any person named or designated in the Collective Bargaining Agreement by the parties to act as their Voluntary Arbitrator, or

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one chosen with or without the assistance of the National Conciliation and Mediation Board, pursuant to a selection procedure agreed upon in the Collective Bargaining Agreement, or any official that may be authorized by the Secretary of Labor and Employment to act as Voluntary Arbitrator upon the written request and agreement of the parties to a labor dispute. (o) "Strike" means any temporary stoppage of work by the concerted action of employees as a result of an industrial or labor dispute. (p) "Lockout" means any temporary refusal of an employer to furnish work as a result of an industrial or labor dispute. (q) "Internal union dispute" includes all disputes or grievances arising from any violation of or disagreement over any provision of the constitution and by-laws of a union, including any violation of the rights and conditions of union membership provided for in this Code. (r) "Strike-breaker" means any person who obstructs, impedes, or interferes with by force, violence, coercion, threats, or intimidation any peaceful picketing affecting wages, hours or conditions of work or in the exercise of the right of self-organization or collective bargaining. (s) "Strike area" means the establishment, warehouses, depots, plants or offices, including the sites or premises used as runaway shops, of the employer struck against, as well as the immediate vicinity actually used by picketing strikers in moving to and fro before all points of entrance to and exit from said establishment.

Article 261 Art. 261. Exclusive bargaining representation and workers’ participation in policy and decision-making. The labor organization designated or selected by the majority of the employees in an appropriate collective bargaining unit shall be the exclusive representative of the employees in such unit for the purpose of collective bargaining. However, an individual employee or group of employees shall have the right at any time to present grievances to their employer.

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Any provision of law to the contrary notwithstanding, workers shall have the right, subject to such rules and regulations as the Secretary of Labor and Employment may promulgate, to 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 labor-management 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. (As amended by Section 22, Republic Act No. 6715, March 21, 1989)

Article 283 Article 283.Miscellaneous provisions. All unions are authorized to collect reasonable membership fees, union dues, assessments and fines and other contributions for labor education and research, mutual death and hospitalization benefits, welfare fund, strike fund and credit and cooperative undertakings. (As amended by Section 33, Republic Act No. 6715, March 21, 1989) Subject to the constitutional right of workers to security of tenure and their right to be protected against dismissal except for a just and authorized cause and without prejudice to the requirement of notice under Article 283 of this Code, the employer shall furnish the worker whose employment is sought to be terminated a written notice containing a statement of the causes for termination and shall afford the latter ample opportunity to be heard and to defend himself with the assistance of his representative if he so desires in accordance with company rules and regulations promulgated pursuant to guidelines set by the Department of Labor and Employment. Any decision taken by the employer shall be without prejudice to the right of the worker to contest the validity or legality of his dismissal by filing a complaint with the regional branch of the National Labor Relations Commission. The burden of proving that the termination was for a valid or authorized cause shall rest on the employer. The Secretary of the Department of

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Labor and Employment may suspend the effects of the termination pending resolution of the dispute in the event of a prima facie finding by the appropriate official of the Department of Labor and Employment before whom such dispute is pending that the termination may cause a serious labor dispute or is in implementation of a mass lay-off. (As amended by Section 33, Republic Act No. 6715, March 21, 1989) Any employee, whether employed for a definite period or not, shall, beginning on his first day of service, be considered as an employee for purposes of membership in any labor union. (As amended by Section 33, Republic Act No. 6715)

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(P15,000,000.00) shall be provided in the 1989 annual general appropriations acts. The amount of subsidy in appropriate cases shall be determined by the Board in accordance with established guidelines issued by it upon the recommendation of the Council. The Fund shall also be utilized for the operation of the Council, the training and education of Voluntary Arbitrators, and the Voluntary Arbitration Program. (As amended by Section 33, Republic Act No. 6715, March 21, 1989)

The Minister of Labor and Employment and the Minister of the Budget shall cause to be created or reclassified in accordance with law such positions as may be necessary to carry out the objectives of this Code and cause the upgrading of the salaries of the personnel involved in the Labor Relations System of the Ministry. Funds needed for this purpose shall be provided out of the Special Activities Fund appropriated by Batas Pambansa Blg. 80 and from annual appropriations thereafter. (Incorporated by Batas Pambansa Bilang 130, August 21, 1981)

The Ministry shall help promote and gradually develop, with the agreement of labor organizations and employers, labormanagement cooperation programs at appropriate levels of the enterprise based on the shared responsibility and mutual respect in order to ensure industrial peace and improvement in productivity, working conditions and the quality of working life. (Incorporated by Batas Pambansa Bilang 130, August 21, 1981) In establishments where no legitimate labor organization exists, labor-management committees may be formed voluntarily by workers and employers for the purpose of promoting industrial peace. The Department of Labor and Employment shall endeavor to enlighten and educate the workers and employers on their rights and responsibilities through labor education with emphasis on the policy thrusts of this Code. (As amended by Section 33, Republic Act No. 6715, March 21, 1989)

A special Voluntary Arbitration Fund is hereby established in the Board to subsidize the cost of voluntary arbitration in cases involving the interpretation and implementation of the Collective Bargaining Agreement, including the Arbitrator’s fees, and for such other related purposes to promote and develop voluntary arbitration. The Board shall administer the Special Voluntary Arbitration Fund in accordance with the guidelines it may adopt upon the recommendation of the Council, which guidelines shall be subject to the approval of the Secretary of Labor and Employment. Continuing funds needed for this purpose in the initial yearly amount of fifteen million pesos

To ensure speedy labor justice, the periods provided in this Code within which decisions or resolutions of labor relations cases or matters should be rendered shall be mandatory. For this purpose, a case or matter shall be deemed submitted for decision or resolution upon the filing of the last pleading or memorandum required by the rules of the Commission or by the Commission itself, or the Labor Arbiter, or the Director of the Bureau of Labor Relations or Med-Arbiter, or the Regional Director. Upon expiration of the corresponding period, a certification stating why a decision or resolution has not been rendered within the said period shall be issued forthwith by the Chairman of the

No docket fee shall be assessed in labor standards disputes. In all other disputes, docket fees may be assessed against the filing party, provided that in bargaining deadlock, such fees shall be shared equally by the negotiating parties.

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Commission, the Executive Labor Arbiter, or the Director of the Bureau of Labor Relations or Med-Arbiter, or the Regional Director, as the case may be, and a copy thereof served upon the parties. Despite the expiration of the applicable mandatory period, the aforesaid officials shall, without prejudice to any liability which may have been incurred as a consequence thereof, see to it that the case or matter shall be decided or resolved without any further delay. (Incorporated by Section 33, Republic Act No. 6715, March 21, 1989)

RECRUITMENT PLACEMENT

AND

RECRUITMENT OF LOCAL AND MIGRANT WORKERS

R.A. 8042 as amended and/or any of his/her relatives within the 4th civil degree of consanguinity and affinity. (POEA Rules of 2002) Non-transferability of license or authority (1) No license or authority shall be used directly or indirectly by any person other than the one in whose favor it was issued or at any place other than that stated in the license or authority, (2) Nor may such license or authority be transferred, conveyed, or assigned to any other person or entity. Any transfer of business address, appointment or designation of any agent or representative including the establishment of additional offices anywhere shall be subject to the prior approval of the Department of Labor. (Art. 29, LC) Duration of Validity: 4 years (POEA Rules of 2002)

LICENSE AND AUTHORITY

Citizenship requirement (1) Only Filipino citizens or (2) Corporations, partnerships or entities at least seventy-five percent (75%) of the authorized and voting capital stock of which is owned and controlled by Filipino citizens shall be permitted to participate in the recruitment and placement of workers, locally or overseas. (Art. 27, LC)

Entities disqualified from being issued a license (1) Travel agencies and sales agencies of airline companies. (Art. 26) (2) Officers or members of the Board of any corporation or members in partnership engaged in the business of a travel agency. (3) Corporations and partnerships, when any of its officers, members of the board or partners, is also an officer, member of the board of partner of a corporation or partnership engaged in the business of a travel agency. (4) Persons, partnerships or corporations which have derogatory records. (5) Any official or employee of the DOLE, POEA, OWWA, DFA and other government agencies directly involved in the implementation of

Capitalization requirement All applicants for authority to hire or renewal of license to recruit are required to have such substantial capitalization as determined by the Secretary of Labor. (Art. 28, LC)

A license is a document issued by the Department of Labor and Employment (DOLE) authorizing a person or entity to operate a private employment agency, while an authority is a document issued by the DOLE authorizing a person or association to engage in recruitment and placement activities as a private recruitment agency. (Art. 13(d) and (f), LC)

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Based on POEA Rules the following are the substantial capital requirements: (1) Single proprietorships or partnerships with minimum capitalization of P2,000,000. (2) Corporations with minimum paid-up capital of P2,000,000.

ESSENTIAL ELEMENTS OF ILLEGAL RECRUITMENT “Recruitment and placement" refers to any act of (C-E-C-T-U-H) 7 of 92

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(a) canvassing, (b) enlisting, (c) contracting, (d) transporting, (e) utilizing, or (f) hiring procuring workers, And also includes (a) referrals, (b) contract services, (c) promising, or (d) advertising for employment, locally or abroad, whether for profit or not Provided, That any person or entity which, in any manner, offers or promises for a fee employment to two or more persons shall be deemed engaged in recruitment and placement. (Art. 13 (b), LC) Any of the acts mentioned above constitutes recruitment and placement.

ILLEGAL RECRUITMENT FOR LOCAL WORKERS (Governed by the Labor Code) SIMPLE ILLEGAL RECRUITMENT Elements: (1) The person charged with the crime must have undertaken recruitment activities defined under Art. 13(b) or prohibited activities defined under Art. 34; and (2) The said person does not have a license or authority to do so. (Art. 38, LC) Prohibited practices It shall be unlawful for any individual, entity, licensee, or holder of authority: (a) To charge or accept, directly or indirectly, any amount greater than that specified in the schedule of allowable fees prescribed by the Secretary of Labor, or to make a worker pay any amount greater than that actually received by him as a loan or advance; (b) To furnish or publish any false notice or information or document in relation to recruitment or employment; (c) To give any false notice, testimony, information or document or commit any act of misrepresentation for the purpose of

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securing a license or authority under this Code. (d) To induce or attempt to induce a worker already employed to quit his employment in order to offer him to another unless the transfer is designed to liberate the worker from oppressive terms and conditions of employment; (e) To influence or to attempt to influence any person or entity not to employ any worker who has not applied for employment through his agency; (f) To engage in the recruitment or placement of workers in jobs harmful to public health or morality or to the dignity of the Republic of the Philippines; (g) To obstruct or attempt to obstruct inspection by the Secretary of Labor or by his duly authorized representatives; (h) To fail to file reports on the status of employment, placement vacancies, remittance of foreign exchange earnings, separation from jobs, departures and such other matters or information as may be required by the Secretary of Labor. (i) To substitute or alter employment contracts approved and verified by the Department of Labor from the time of actual signing thereof by the parties up to and including the periods of expiration of the same without the approval of the Secretary of Labor; (j) To become an officer or member of the Board of any corporation engaged in travel agency or to be engaged directly or indirectly in the management of a travel agency; and (k) To withhold or deny travel documents from applicant workers before departure for monetary or financial considerations other than those authorized under this Code and its implementing rules and regulations. (Art. 34, LC) OFFENSE INVOLVING ECONOMIC SABOTAGE (Large-Scale or by a Syndicate) Illegal recruitment is considered economic sabotage when the commission thereof is attended by the ff. qualifying circumstances:

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(1) By a syndicate - if carried out by a group of 3 or more persons conspiring and confederating with one another; (2) In large scale - if committed against 3 or more persons individually or as a group. (Art. 38(b), LC)

2nd type: (1) Person charged commits any of the enumerated acts under Sec. 6 of R.A. 8042, as amended by, R.A. 10022. (2) It is immaterial whether he is a holder or not of any license or authority

Illegal recruitment by a syndicate (1) The offender undertakes either any activity within the meaning of "recruitment and placement" defined under Article 13(b), or any of the prohibited practices enumerated under Art. 34 of the Labor Code; (2) He has no valid license or authority required by law to enable one to lawfully engage in recruitment and placement of workers; AND (3) The illegal recruitment is committed by a group of three (3) or more persons conspiring or confederating with one another. [People v. Gallo (2010)]

Illegal recruitment shall mean any act of canvassing, enlisting, contracting, transporting, utilizing, hiring, or procuring workers and includes referring, contract services, promising or advertising for employment abroad, whether for profit or not, when undertaken by nonlicensee or non-holder of authority contemplated under Article 13(f) of Presidential Decree No. 442, as amended, otherwise known as the Labor Code of the Philippines

Illegal recruitment in large scale The acts committed by the accused constituted illegal recruitment in large scale, whose essential elements are the following: (1) The accused engages in acts of recruitment and placement of workers defined under Article 13(b) of the Labor Code or in any prohibited activities under Article 43 of the Labor Code; (2) The accused has not complied with the guidelines issued by the Secretary of Labor and Employment, particularly with respect to the securing of license or an authority to recruit and deploy workers, either locally or overseas; and (3) The accused commits the unlawful acts against three or more persons individually or as a group.

ILLEGAL RECRUITMENT FOR MIGRANT WORKERS (Governed by R.A. 8042, as amended by, R.A. 10022)

SIMPLE ILLEGAL RECRUITMENT 1st type: (1) Person charged undertakes any recruitment activity as defined in Art.13 (b) of the Labor Code; and (2) Said person does not have a license or authority to do so.

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Provided, that any such non-licensee or nonholder who, in any manner, offers or promises for a fee employment abroad to two or more persons shall be deemed so engaged. (Sec. 6, RA 8042 as amended) OTHER PROHIBITED ACTS It shall likewise include the following acts, whether committed by any person, whether a non-licensee, non-holder, licensee or holder of authority: (a) To charge or accept directly or indirectly any amount greater than that specified in the schedule of allowable fees prescribed by the Secretary of Labor and Employment, or to make a worker pay or acknowledge any amount greater than that actually received by him as a loan or advance; (b) To furnish or publish any false notice or information or document in relation to recruitment or employment; (c) To give any false notice, testimony, information or document or commit any act of misrepresentation for the purpose of securing a license or authority under the Labor Code, or for the purpose of documenting hired workers with the POEA, which include the act of reprocessing workers through a job order that pertains to nonexistent work, work different from the actual overseas work, or work with a different employer whether registered or not with the POEA;

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(d) To include or attempt to induce a worker already employed to quit his employment in order to offer him another unless the transfer is designed to liberate a worker from oppressive terms and conditions of employment; (e) To influence or attempt to influence any person or entity not to employ any worker who has not applied for employment through his agency or who has formed, joined or supported, or has contacted or is supported by any union or workers' organization; (f) To engage in the recruitment or placement of workers in jobs harmful to public health or morality or to the dignity of the Republic of the Philippines; (g) To fail to submit reports on the status of employment, placement vacancies, remittance of foreign exchange earnings, separation from jobs, departures and such other matters or information as may be required by the Secretary of Labor and Employment; (h) To substitute or alter to the prejudice of the worker, employment contracts approved and verified by the Department of Labor and Employment from the time of actual signing thereof by the parties up to and including the period of the expiration of the same without the approval of the Department of Labor and Employment; (i) For an officer or agent of a recruitment or placement agency to become an officer or member of the Board of any corporation engaged in travel agency or to be engaged directly or indirectly in the management of travel agency; (j) To withhold or deny travel documents from applicant workers before departure for monetary or financial considerations, or for any other reasons, other than those authorized under the Labor Code and its implementing rules and regulations; (k) Failure to actually deploy a contracted worker without valid reason as determined by the Department of Labor and Employment; (l) Failure to reimburse expenses incurred by the worker in connection with his documentation and processing for purposes of deployment, in cases where

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the deployment does not actually take place without the worker's fault. Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense involving economic sabotage; and (m) To allow a non-Filipino citizen to head or manage a licensed recruitment/manning agency. In addition to the acts enumerated above, it shall also be unlawful for any person or entity to commit the following prohibited acts: (1) Grant a loan to an overseas Filipino worker with interest exceeding eight percent (8%) per annum, which will be used for payment of legal and allowable placement fees and make the migrant worker issue, either personally or through a guarantor or accommodation party, postdated checks in relation to the said loan; (2) Impose a compulsory and exclusive arrangement whereby an overseas Filipino worker is required to avail of a loan only from specifically designated institutions, entities or persons; (3) Refuse to condone or renegotiate a loan incurred by an overseas Filipino worker after the latter's employment contract has been prematurely terminated through no fault of his or her own; (4) Impose a compulsory and exclusive arrangement whereby an overseas Filipino worker is required to undergo health examinations only from specifically designated medical clinics, institutions, entities or persons, except in the case of a seafarer whose medical examination cost is shouldered by the principal/shipowner; (5) Impose a compulsory and exclusive arrangement whereby an overseas Filipino worker is required to undergo training, seminar, instruction or schooling of any kind only from specifically designated institutions, entities or persons, except for recommendatory trainings mandated by principals/shipowners where the latter shoulder the cost of such trainings; (6) For a suspended recruitment/manning agency to engage in any kind of recruitment activity including the

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processing of pending workers' applications; and (7) For a recruitment/manning agency or a foreign principal/employer to pass on the overseas Filipino worker 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. (Sec. 6, RA 8042 as amended)

In every case, conviction shall cause and carry the automatic revocation of the license or authority and all the permits and privileges granted to such person or entity under this Title, and the forfeiture of the cash and surety bonds in favor of the Overseas Employment Development Board or the National Seamen Board, as the case may be, both of which are authorized to use the same exclusively to promote their objectives.

OFFENSE INVOLVING ECONOMIC SABOTAGE (Large-Scale or by a Syndicate)

Illegal Recruitment Involving Migrant Workers (Sec. 7, RA 8042 as amended by RA 10022)

Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring or confederating with one another. It is deemed committed in large scale if committed against three (3) or more persons individually or as a group. LIABILITIES & PENALTIES FOR ILLEGAL RECRUITMENT Illegal Recruitment Involving Local Workers (Art. 39, LC) Act

Penalty

Illegal recruitment Life imprisonment & constituting Fine: P100,000.00 economic sabotage Licensee or holder or authority violating or causing another to violate Title I, Book I, LC

2 years ≤ Imprisonment ≤ 5 years OR P10,000 ≤ Fine ≤ P50,000 OR both

Violating or causing 4 years ≤ Imprisonment ≤ another to violate 8 years OR Title I, Book I, LC P20,000 ≤ Fine ≤ P100,000 OR both If the offender is a corporation, partnership, association or entity, the penalty shall be imposed upon the officer or officers of the corporation, partnership, association or entity responsible for violation. If such officer is an alien, he shall, in addition to the penalties herein prescribed, be deported without further proceedings.

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Act

Penalty

Illegal recruitment

12 years and 1 day ≤ Imprisonment ≤ 20 years & P1M ≤ Fine ≤ P2M

Illegal recruitment constituting economic sabotage

Life imprisonment AND P2M ≤ Fine ≤ P5M Maximum penalty: 1. illegally recruited person below 18 years old OR 2. Without license/authority

Prohibited Act/s 6 years and 1 day ≤ Imprisonment ≤ 12 years AND P500k ≤ Fine ≤ P1M If the offender is an alien, he or she shall, in addition to the penalties herein prescribed, be deported without further proceedings. In every case, conviction shall cause and carry the automatic revocation of the license or registration of the recruitment/manning agency, lending institutions, training school or medical clinic. Common Rules on Illegal Recruitment (Local or Overseas) Venue A criminal action arising from illegal recruitment shall be filed with the RTC of the province or city: (1) where the offense was committed or (2) where the offended party actually resides at the time of the commission of the offense.

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(Sec. 9, R.A. 8042 [this part was not amended by R.A. 10022]). Prescriptive Periods (1) Simple Illegal Recruitment – 5 years (2) Illegal Recruitment involving Economic Sabotage – 20 years. (Sec. 12, R.A. 8042 [this part was not amended by R.A, 10022]). Pre-Termination of Contract of Migrant Worker (Sec. 10, R.A. 8042, as amended by R.A. 10022) In case of termination of overseas employment o without just, valid or authorized cause as defined by law or contract, or o any unauthorized deductions from the migrant worker's salary The worker shall be entitled to the full reimbursement of: (1) his placement fee and the deductions made with interest at twelve percent (12%) per annum (2) 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.

DIRECT HIRING

General Rule: No employer may hire a Filipino worker for overseas employment except through the Boards and entities authorized by the Secretary of Labor. (Art. 18, LC) Exceptions: (1) Members of the diplomatic corps; (2) International organizations; (3) Such other employees as may be allowed by the Sec. of Labor; (4) Name hirees – those individuals who are able to secure contracts for overseas employment on their own efforts and representation without the assistance or participation of any agency. Their hiring, nonetheless, has to be processed through the POEA. (Part III, Rule III of the POEA Rules Governing Overseas Employment as amended in 2002)

GOVERNMENT TECHNIQUES OF REGULATION & ENFORCEMENT

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SUSPENSION OR CANCELLATION OF LICENSE OR AUTHORITY

The Secretary of Labor shall have the power to suspend or cancel any license or authority to recruit employees for overseas employment for o violation of rules and regulations issued by the Department of Labor, the Overseas Employment Development Board, and the National Seamen Board o violation of the provisions of this and other applicable laws, General Orders and Letters of Instructions. (Article 35, LC) The acts prohibited under Article 34 are grounds for suspension or cancellation of license. Note that they likewise constitute illegal recruitment under R.A. 8042 as amended by R.A. 10022.

REGULATORY & VISITORIAL POWERS OF THE DOLE SECRETARY

REGULATORY POWERS (Art. 36, LC) The Secretary of Labor shall have the power to restrict and regulate the recruitment and placement activities of all agencies within the coverage of this Title and is hereby authorized to issue orders and promulgate rules and regulations to carry out the objectives and implement the provisions of this Title. VISITORIAL POWERS (Art. 37, LC) The Secretary of Labor or his duly authorized representatives may, at any time, inspect the premises, books of accounts and records of any person or entity covered by this Title, require it to submit reports regularly on prescribed forms, and act on violations of any provisions of this Title.

POEA STANDARD CONTRACT

EMPLOYMENT

Document containing the standard terms and condition of the seafarer’s employment in foreign ocean-going vessels To be integrated in every seafarer’s contract The POEA rules and regulations require that the POEA Standard Employment Contract…be integrated in every seafarer’s contract. This, together with the contract the employees sign

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every time they are hired, constitutes the law between the parties. I Construction: liberal The POEA standard employment contract for seamen was designed primarily for the protection and benefit of Filipino seamen in the pursuit of their employment on board oceangoing vessels. Its provisions must be construed and applied fairly, reasonably and liberally in their favor. Only then can its beneficent provisions be fully carried into effect. [Abante v. KJGS Fleet Management (2009)] Breach of contract may give rise to a cause of action even before commencement of EE-ER relationship Even if by the standard contract employment commences only “upon actual departure of the seafarer”, this does not mean that the seafarer has no remedy in case of non-deployment without any valid reason. Even before the start of any employer-employee relationship, contemporaneous with the perfection of the employment contract was the birth of certain rights and obligations, the breach of which may give rise to a cause of action for damages under the Civil Code against the erring party. [StoltNielsen v. Medequillo (2012)]

REMITTANCE OF EXCHANGE EARNINGS

FOREIGN

It shall be mandatory for all Filipino workers abroad to remit a portion of their foreign earnings to their families, dependents, and/or beneficiaries in the country (Art. 22, LC) Amount required to be remitted (Executive Order No. 857) The amount of one’s salary required to be remitted depends on the type or nature of work performed by the employee. The following are the percentages of foreign exchange remittance required from various kinds of migrant workers: (1) Seaman or mariner – 80% of their basic salary (2) Workers for Filipino contractors and construction companies – 70%

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(3) Doctors, engineers, teachers, nurses and other professional workers whose contract provide for free board and lodging – 70% (4) All other professional workers whose employment contracts do not provide for free board and lodging facilities – 50% (5) Domestic and other service workers – 50% (6) All other workers not falling under the aforementioned categories – 50% (7) Performing artists – 50% Individuals exempted from the mandatory remittance requirement: (1) The immediate family members, dependents or beneficiaries of migrant workers residing with the latter abroad; (2) Filipino servicemen working within US military installations; (3) Immigrants and Filipino professionals working with the United Nations and its agencies or other specialized bodies.

Labor Standards COVERAGE General rule: Shall apply to employees in all establishments and undertakings whether for profit or not. (Art. 82, LC) Exceptions (NOT Covered): (1) Government employees (Art. 82; Art. 76) (2) Managerial Employees including members of the managerial staff (Art. 82) (3) Field Personnel (Art. 82) (4) Members of the family of the employer who are dependent on him for support (Art. 82); (5) Domestic helpers and persons in personal service of another (Art. 141) (6) Workers who paid by result as determined by DOLE regulation (Art. 82) GOVERNMENT EMPLOYEES The terms and conditions of employment of all government employees, including employees of GOCCs, are governed by the Civil Service rules and regulations, not by the Labor Code (Art. 282).

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MANAGERIAL EMPLOYEES Two definitions of “managerial employees” in the Labor Code Article 82: Those whose primary duty consists of the management of the establishment in which they are employed or of a department or subdivision thereof, and to other officers or members of the managerial staff. (Art. 82, LC) Article 212 (m): One who is vested with the powers or prerogatives to lay down and execute management policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees. Supervisory employees are those who, in the interest of the employer, effectively recommend such managerial actions if the exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment. All employees not falling within any of the above definitions are considered rank-and-file employees for purposes of this Book Characteristics of managerial employees (Book 3, Rule 1, Sec. 2(b), IRR) Managerial employees qualify for the exception if they meet all of the following conditions: (1) Their primary duty consists of the management of the establishment in which they are employed or of a department or sub-division thereof. (2) They customarily and regularly direct the work of two or more employees therein. (3) They have the authority to hire or fire employees of lower rank; or their suggestions and recommendations as to hiring and firing and as to the promotion or any other change of status of other employees, are given particular weight. Managerial Staff also included (Book 3, Rule 1, Sec. 2(c), IRR) Officers or members of a managerial staff also qualify for the exception if they perform the following duties and responsibilities: (1) The primary duty consists of the performance of work directly related to

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management policies of their employer; (2) Customarily and regularly exercise discretion and independent judgment; (3) To: (a) Regularly and directly assist a proprietor or a managerial employee whose primary duty consists of the management of the establishment in which he is employed or subdivision thereof; OR (b) Execute under general supervision work along specialized or technical lines requiring special training, experience, or knowledge; OR (c) Execute, under general supervision, special assignments and tasks; (4) Who do not devote more than 20 percent of their hours worked in a work week to activities which are not directly and closely related to the performance of the work described in paragraphs (1), (2) and (3) above. FIELD PERSONNEL Non-agricultural employees (1) who regularly perform their duties away from the principal place of business or branch office of the employer AND (2) whose actual hours of work in the field cannot be determined with reasonable certainty. (Art. 82, LC) DEPENDENT FAMILY MEMBERS Workers who are family members of the employer, and who are dependent on him for their support, are outside the coverage of this Title on working conditions and rest periods. DOMESTIC HELPERS "Domestic or household service" shall mean service in the employer’s home which is usually necessary or desirable for the maintenance and enjoyment thereof and includes ministering to the personal comfort and convenience of the members of the employer’s household, including services of family drivers. (Art. 141, LC) Note: The Kasambahay Law (RA 10361) has redefined “domestic worker” or “kasambahay”: Domestic worker or “Kasambahay” refers to any person engaged in domestic work within an employment relationship such as, but not limited to, the following: general househelp,

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nursemaid or “yaya”, cook, gardener, or laundry person, but shall exclude any person who performs domestic work only occasionally or sporadically and not on an occupational basis. (RA 10361 Art. 1, Sec. 4 (d)) PERSONS IN PERSONAL SERVICE OF ANOTHER The provisions of this Rule shall not apply to the following persons if they qualify for exemption under the conditions set forth herein: Domestic servants and persons in the personal service of another if they perform such services in the employer’s home which are usually necessary or desirable for the maintenance and enjoyment thereof, or minister to the personal comfort, convenience, or safety of the employer as well as the members of his employer’s household. (Book 3, Rule 1, Sec. 2 (d), IRR) WORKERS PAID BY RESULT Workers who are paid by results, including those who are paid on piece-work, “takay,” “pakiao” or task basis, and other non-time work if their output rates are in accordance with the standards prescribed under Section 8, Rule VII, Book Three of these regulations, or where such rates have been fixed by the Secretary of Labor and Employment in accordance with the aforesaid Section. (Book 3, Rule 1, Sec. 2 (e), IRR)

HOURS OF WORK COVERAGE/EXCLUSIONS supra

NORMAL HOURS OF WORK

General Rule: 8-Hour Labor Law The normal hours of work of any employee shall not exceed eight (8) hours a day. (Art. 83, LC) Exception to the 8-Hour Law: Work Hours of Health Personnel Health personnel in (1) Cities and municipalities with a population of at least one million (1,000,000) OR (2) Hospitals and clinics with a bed capacity of at least one hundred (100) shall hold regular office hours for eight (8)

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hours a day, for five (5) days a week, exclusive of time for meals, except where the exigencies of the service require that such personnel work for six (6) days or forty-eight (48) hours, in which case, they shall be entitled to an additional compensation of at least thirty percent (30%) of their regular wage for work on the sixth day. For purposes of this Article, "health personnel" shall include resident physicians, nurses, nutritionists, dietitians, pharmacists, social workers, laboratory technicians, paramedical technicians, psychologists, midwives, attendants and all other hospital or clinic personnel. (Art. 38, LC) COMPENSABLE HOURS OF WORK (Art. 84, LC) Hours worked shall include (a) All time during which an employee is required to be on duty or to be at a prescribed workplace; AND (b) All time during which an employee is suffered or permitted to work. Rest period – short duration or “coffee break” Rest periods of short duration during working hours shall be counted as hours worked. (Art. 84, par. 2, LC) Rest periods or coffee breaks running from five (5) to twenty (20) minutes shall be considered as compensable working time. (Bk III, Rule 1, Sec. 7, par. 2, IRR) An employee need not leave the premises of the work place in order that his rest period shall not be counted, it being enough that he stops working, may rest completely and may leave his work place, to go elsewhere, whether within or outside the premises of his work place. (Book 3, Rule 1, Sec. 4 (b) of the IRR) On call An employee who is (a) required to remain on call in the employer’s premises or so close thereto (b) that he cannot use the time effectively and gainfully for his own purpose

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shall be considered as working while on call. An employee who is not required to leave word at his home or with company officials where he may be reached is not working while on call. (Book III, Rule 1, Sec. 5(b), IRR) Inactive due to work interruptions The time during which an employee is inactive by reason of interruptions in his work beyond his control shall be considered working time either: (a) if the imminence of the resumption of work requires the employee's presence at the place of work OR (b) if the interval is too brief to be utilized effectively and gainfully in the employee's own interest. (Book III, Rule 1, Sec. 4(d), IRR) Work interruption due to brownouts Brownouts of short duration, but not exceeding 20 minutes, shall be treated as hours worked, whether used productively by the employees or not. If they last more than 20 minutes, the time may not be treated as hours worked if the employees can leave their workplace or go elsewhere whether within or without the work premises; or the employees can use the time effectively for their own interest. In this case, the employer may extend the working hours beyond the regular schedule on that day to compensate for the loss of productive man-hours without being liable for overtime pay. (Policy Instruction No. 36, May 22, 1978) Note: The time during which an employee is inactive by reason of work interruptions beyond his control is considered working time, either if the imminence of the resumption of work requires the employee’s presence at the place of work or if the interval is too brief to be utilized effectively and gainfully in the employee’s own interest. (Book III, Rule 1 Sec. 4-c OR) Necessary work after normal hours If the work performed was necessary, or it benefited the employer, or the employee could not abandon his work at the end of his normal working hours because he had no replacement, all the time spent for such work shall be

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considered as hours worked if the work was with the knowledge of his employer or immediate supervisor. [IRR, Book III, Rule 1, Sec. 4(c)] Lectures, meetings, trainings Attendance at lectures, meetings, training programs, and other similar activities shall not be counted as working time if ALL of the following conditions are met: (1) Attendance is outside of the employee’s regular working hours; (2) Attendance is in fact voluntary; and (3) The employee does not perform any productive work during such attendance. (IRR, Book III, Rule 1, Sec. 6) Note: (1) Attendance in lectures, meetings, and training periods sanctioned by the employer are considered hours worked. (2) Attendance in CBA negotiations or grievance meeting is compensable hours worked. (3) Attendance in hearings in cases filed by the employee is NOT compensable hours worked. (4) Participation in strikes is NOT compensable working time. Idle Time The idle time that an employee may spend for resting and dining which he may leave the spot or place of work though not the premises of his employer, is not counted as working time only where the work is broken or is not continuous. [National Development Co. v. CIR (1962)] Travel Time (Department of Labor Manual) (1) Travel from home to work – An employee who travels from home before his regular workday and returns to his home at the end of the workday is engaged in ordinary hometo-work travel which is NOT worktime, except: (a) When called to travel during emergency; (b) When travel is done through a conveyance furnished by the employer; (c) Travel is done under vexing and dangerous circumstances; (d) Travel is done under the supervision and control of the employer. (2) Travel that is all in the day’s work – Time spent by an employee in travel from jobsite

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to jobsite during the workday, must be counted as hours worked. Where an employee is required to report at a meeting place to receive instructions or to perform other work there, the travel from the designated place to the workplace is part of the day’s work. (3) Travel away from home - Travel that keeps an employee away from home overnight is travel away from home. Travel away from home is worktime when it cuts across the employee’s workday. The time is hours worked not only on regular working hours but also during the corresponding hours on non-working days. COMPRESSED WORK WEEK (CWW) (DOLE Advisory No. 02, Series of 2004) Under the CWW scheme, the normal workday goes beyond eight hours without the corresponding overtime premium. The total hours of work, however, shall not exceed 12 hours a day or 48 hours a week, or the employer is obliged to pay the worker the overtime premium in excess of said work hours. Conditions for CWW (1) The CWW scheme is undertaken as a result of an express and voluntary agreement of majority of the covered employees or their duly authorized representatives. (2) In firms using substances, chemicals and processes or operating under conditions where there are airborne contaminants, human carcinogens or noise prolonged exposure to which may pose hazards to employees’ health and safety, there must be a certification from an accredited health and safety organization or practitioner from the firm’s safety committee that work beyond eight hours is within threshold limits or tolerable levels of exposure, as set in the OSHS. (3) The employer shall notify DOLE, through the Regional Office having jurisdiction over the workplace, of the adoption of the CWW scheme. The notice shall be in DOLE CWW Report Form attached to this Advisory. (DOLE Advisory No. 02-04)

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MEAL BREAK General Rule: Subject to such regulations as the Secretary of Labor may prescribe, it shall be the duty of every employer to give his employees not less than sixty (60) minutes time-off for their regular meals (Art. 85, LC) Exception: Employees may be given a meal period of not less than twenty (20) minutes provided that such shorter meal period is credited as compensable hours worked of the employee: (a) Where the work is non-manual work in nature or does not involve strenuous physical exertion; (b) Where the establishment regularly operates not less than sixteen (16) hours a day; (c) In case of actual or impending emergencies or there is urgent work to be performed on machineries, equipment or installations to avoid serious loss which the employer would otherwise suffer; and (d) Where the work is necessary to prevent serious loss of perishable goods (Book 3, Rule 1, Sec. 7 par 1, IRR) SYNTHESIS OF THE RULES General Rule: Meal periods compensable.

are

NOT

Exception: It becomes compensable: (1) Where the lunch period or meal time is predominantly spent for the employer’s benefit. (Azucena citing 31 Am. Jur. 881; Duka, Labor Laws and Social Legislation) (2) Meal periods of 1 hour is deemed compensable when the employee is on continuous shift. (National Development Co. v. CIR, G.R. No. L-15422, Nov. 30, 1962) (3) Shortened meal period of less than 1 hour (say, 30 minutes) must be compensable. (Sec. 7, Rule I, Book III, IRR) Note: To shorten meal time to less than 20 minutes is not allowed. If the so-called meal time is less than 20 minutes, it becomes only a REST PERIOD and is considered working time. Exception to the Exception: Shortened meal breaks upon the employees’ request – NOT compensable. The employees themselves may request that the meal period be shortened so

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that they can leave work earlier than the previously established schedule. (Drilon: Letter to Kodak Philippines, Nov. 27, 1989; also Cilindro: BWC-WHSD Opinion No. 197, s. 1998).

WAITING TIME Waiting time spent by an employee shall be considered as working time if waiting is an integral part of his work or the employee is required or engaged by the employer to wait. (Book III, Rule I Sec. 5(a), IRR) An employee who is required to remain on call in the employer’s premises or so close thereto that he cannot use the time effectively and gainfully for his own purpose shall be considered as working while on call. (Book 3, Rule 1, Sec. 5, IRR)

OVERTIME WORK, OVERTIME PAY

OVERTIME ON ORDINARY WORKING DAY Work may be performed beyond eight (8) hours a day provided that the employee is paid for the overtime work, an additional compensation equivalent to his regular wage plus at least twenty-five percent (25%) thereof. (Art. 87, LC) OVERTIME WORK ON HOLIDAY OR REST DAY Work performed beyond eight hours on a holiday or rest day shall be paid an additional compensation equivalent to the rate of the first eight hours on a holiday or rest day plus at least thirty percent (30%) thereof. (Art. 87, LC) EMERGENCY OVERTIME (Art. 89, LC) Any employee may be required by the employer to perform overtime work in any of the following cases: (1) When the country is at war or when any other national or local emergency has been declared by the National Assembly or the Chief Executive; (2) When it is necessary to prevent loss of life or property or in case of imminent danger to public safety due to an actual or impending emergency in the locality caused by serious accidents, fire, flood, typhoon, earthquake, epidemic, or other disaster or calamity; (3) When there is urgent work to be performed on machines, installations, or equipment, in UP LAW BOC

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order to avoid serious loss or damage to the employer or some other cause of similar nature; (4) When the work is necessary to prevent loss or damage to perishable goods; and (5) Where the completion or continuation of the work started before the eighth hour is necessary to prevent serious obstruction or prejudice to the business or operations of the employer. CANNOT OFFSET UNDERTIME Undertime work on any particular day shall not be offset by overtime work on any other day. Permission given to the employee to go on leave on some other day of the week shall not exempt the employer from paying the additional compensation required in this Chapter. (Art. 88, LC)

NIGHT WORK, DIFFERENTIAL

NIGHT

SHIFT

Night worker Any employed person whose work requires performance of a substantial number of hours of night work which exceed a specified limit. This limit shall be fixed by the Sec of Labor after consulting the workers’ representatives/labor organizations and employers. (Art. 154, RA 10151) Night shift differential The additional compensation of 10% of an employee’s regular wage for each hour of work performed between 10pm and 6am. (Art. 86, LC) Coverage (Book 3, Rule 2, Sec. 1, IRR) All employees, except: (a) Those of the government and any of its political subdivisions, including governmentowned and/or controlled corporations; (b) Those of retail and service establishments regularly employing not more than five (5) workers; (c) Domestic helpers and persons in the personal service of another; (d) Managerial employees as defined in Book Three of this Code; (e) Field personnel and other employees whose time and performance is unsupervised by the 18 of 92

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employer including those who are engaged on task or contract basis, purely commission basis, or those who are paid a fixed amount for performing work irrespective of the time consumed in the performance thereof. Rest days (night-off) Night shift employees are entitled to a weekly night-off (usually Saturday evening) or a weekly rest period of 24 hours beginning at the start of the night shift. Work on special days Night shift employees are also entitled to the premium pay on special days and holidays. These days are reckoned as calendar days which start at midnight and end at the following midnight. The premium pay for the night shift also starts or ends at midnight. However, the employment contract, company policy or CBA may provide that in the case of night shift workers, days—including special days and regular holidays—shall begin on the night before a calendar day.

PART-TIME WORK

A single, regular or voluntary form of employment with hours of work substantially shorter than those considered as normal in the establishment. (International Labor Organization) This excludes those forms of employment which, although referred to as part-time work, are in particular, irregular, temporary or intermittent employment, or in cases where hours of work have been temporarily reduced for economic, technical or structural reasons. The wage and benefits of part-time worker are in proportion to the number of hours worked. CONTRACT FOR PIECE OF WORK A contract for the delivery at a certain price of an article which the vendor in the ordinary course of his business manufactures or procures for the general market, whether the same is on hand at the time or not, is a contract of sale BUT if the goods are to be manufactured specially for the customer and upon his special

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order, and not for the general market, it is a contract for a piece of work. (Article 1467, CC)

WAGES Definition (a) It is the remuneration or earnings, however designated, capable of being expressed in terms of money, (b) whether fixed or ascertained on a time, task, piece, or commission basis, or other method of calculating the same, (c) which is payable by an employer to an employee (d) under a written or unwritten contract of employment for work done or to be done, or for services rendered or to be rendered and (e) 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 reasonable value - shall not include any profit to the employer, or to any person affiliated with the employer. (Art. 97(f)) “No work no pay” principle General Rule: the age old rule governing the relation between labor and capital or management and employee is that a "fair day's wage for a fair day's labor." Exception: When the laborer was able, willing and ready to work but was illegally locked out, suspended or dismissed, or otherwise illegally prevented from working. “Equal Work for Equal Pay” Principle Employees working in the Philippines, if they are performing similar functions and responsibilities under similar working conditions should be paid equally. If an employer accords employees the same position and rank, the presumption is that these employees perform equal work. Coverage/Exclusions (Art. 98 and Bk 3, Rule VII, Sec 3, IRR) The Labor Code Title on wages shall not apply to the following: (1) Farm tenancy or leasehold; (2) Household or domestic helpers, including family drivers and other persons in the personal service of another; 19 of 92

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(3) Homeworkers engaged in needlework; (4) Workers in registered cottage industries who actually work at home; (5) Workers in registered cooperatives when so recommended by the Bureau of Cooperative Development upon approval of the Secretary of Labor; (6) Workers in registered barangay micro business enterprise (RA 9178).

WAGE VS. SALARY

There are slight differences: Wage

Salary

Paid for skilled or Paid to white collar unskilled manual labor workers and denote a higher grade of employment Not subject to execution, garnishment or attachment except for debts related to necessities (Art. 1708)

Not exempt from execution, garnishment or attachment (Gaa vs. CA, 1985)

MINIMUM WAGE Statutory minimum wage is the lowest wage rate fixed by law that an ER can pay his workers. [IRR, RA 6727, (o)] COVERAGE General Rule: The wage increases prescribed under Wage Orders apply to all private sector workers and EEs receiving the daily minimum wage rates or those receiving up to a certain daily wage ceiling, where applicable, regardless of their position, designation, or status, and irrespective of the method by which their wages are paid. Exceptions: (1) Domestic Helpers/kasambahay are covered by RA 10361 (2) Workers of registered barangay micro business enterprise with Certificates of Authority issued by the Office of the Municipal or City Treasurer. EXEMPTIONS Upon application with and as determined by the Regional Tripartite Wages and Productivity

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Board, based on documentation and other requirements in accordance with applicable rules and regulations issued by the NWPC, the following may be exempted from the applicability of this Order: (1) Distressed establishments; (2) Retail/Service establishments regularly employing not more than 10 workers; (3) Establishments whose total assets including those arising from loans but exclusive of the land on which the particular business entity’s office, plant and equipment are situated, are not more than P3 Million; and, (4) Establishments adversely affected by natural calamities. (Sec. 8, Wage Order No. 18, 2013) BASIS The basis of the minimum wage rates prescribed by law shall be the normal working hours of 8 hours a day. (Sec 7, IRR of RA 6727) Factors/Criteria in determining regional minimum wages: (1) Demand for living wages; (2) Wage adjustment the consumer price index; (3) Cost of living and changes or increases therein; (4) The needs of workers and their families; (5) The need to induce industries to invest in the countryside; (6) Improvements in standards of living; (7) Prevailing wage levels; (8) Fair return of the capital invested and capacity to pay of employers; (9) Effects in employment generation and family income; and (10) Equitable distribution of income and wealth along the imperatives of economic and social development. (Art. 124) Procedure for Wage Fixing by Regional Board (Art. 123) (1) Investigate and study pertinent facts, based on criteria set in Art. 124 (2) Conduct public hearings or consultations with notice to employer and employee groups, provinces, city, municipal officials and other interested parties (3) Decide to ISSUE or NOT TO ISSUE a wage order o Frequency: Wage orders issued may not be disturbed for 12 months from effective

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date; this serves as a bar for petitions for wage hikes as well o EXCEPT: when Congress passes a new law affecting wages or other supervening circumstances o Effectivity: If it decides to ISSUE a wage order, the wage order takes effect after 15 days from complete publication in at least 1 newspaper of general circulation in the region (4) Appeal wage order to Commission within 10 calendar days; mandatory for the Commission to decide within 60 calendar days from filing Filing of an appeal DOES NOT STAY order unless appellant files an undertaking with a surety, to guarantee payment of employees if the wage order is affirmed (as amended by RA 6727)

MINIMUM WAGE OF WORKERS WORKERS PAID BY RESULTS All workers paid by result, including those who are paid on piecework, takay, pakyawor task basis, shall receive not less than the prescribed wage rates per eight (8) hours of work a day, or a proportion thereof for working less than eight (8) hours. (Art. 124) MINIMUM WAGE OF APPRENTICES AND LEARNERS Wages of apprentices and learners shall in no case be less than 75% of the applicable minimum wage rates. (Art. 61 & 75, LC) Note: Learners employed in piece or incentiverate jobs during the training period shall be paid in full for the work done. (Art. 76, LC) The Secretary of Labor and Employment may authorize the hiring of apprentices without compensation whose training on the job is required by the school or training program curriculum or as requisite for graduation or board examination. (Art. 72, LC) MINIMUM WAGE OF PERSONS WITH DISABILITY A qualified disabled EE shall be subject to the same terms and conditions of employment and

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the same compensation, privileges, benefits, fringe benefits or allowances as a qualified able-bodied persons. (Sec 5, RA 7277, The Magna Carta for Disabled Persons)

COMMISSIONS

Commissions have been defined as the recompense, compensation or reward of an agent, salesman, executor, trustee, receiver, factor, broker or bailee, when the same is calculated as a percentage on the amount of his transactions or on the profit to the principal. [Philippine Duplicator’s, Inc. v. NLRC (1993)] Commissions as part of minimum wage The Court held that the definition of “wage” under Art. 97 (f) of the LC explicitly includes commissions as part of wages. While commissions are, indeed, incentives or forms of encouragement to inspire employees to put a little more industry on the jobs particularly assigned to them, still these commissions are direct remunerations for services rendered. Likewise, there is no law mandating that commissions be paid only after the minimum wage has been paid to the employee. Verily, the establishment of a minimum wage only sets a floor below which an employee’s remuneration cannot fall, not that commissions are excluded from wages in determining compliance with the minimum wage law. [Iran v. NLRC (1998)]

DEDUCTIONS FROM WAGES

General Rule: No employer, in his own behalf or in behalf of any person, shall make any deduction from the wages of his employees. (Art. 113) Exceptions: (1) In cases where the worker is insured with his consent by the employer, and the deduction is to recompense the employer for the amount paid by him as premium on the insurance; (2) For union dues, in cases where the right of the worker or his union to check-off has been recognized by the employer or authorized in writing by the individual worker concerned; and (3) In cases where the employer is authorized by law or regulations issued by the Secretary of 21 of 92

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Labor and Employment (Art. 113), such as: (a) Employee debt to employer is due and demandable (CC 1706); (b) Attachment or execution in cases of debts incurred for necessities: food, shelter, clothing, medical attendance (CC 1708); (c) Withholding tax; (d) Deductions of a legally established cooperative; (e) Payment to 3rd parties upon written authority by employee; (f) Deductions for loss or damage; (g) SSS, Medicare, Pag-IBIG premiums; (h) Deduction for value meals and other facilities. It shall be unlawful to make any deduction from the wages of any employee for the benefit of the employer as consideration of a promise of employment or retention in employment. (Art. 117) or to retaliate against the employee who filed a complaint. (Art. 118) With Employee’s consent in writing

Without Employee’s consent

(1) SSS Payments (a) Worker’s insurance (2) PHILHEALTH payments acquired by the (3) Contributions to PAGemployer IBIG Fund (b) Union dues, where (4) Value of meals and other the right to checkfacilities off is recognized by (5) Payments to third the employer persons with employee’s (provided in the consent CBA) (6) Deduction of absences (c) Debts of the (7) Union dues, where employee to the check-off is not provided employer that have in the CBA. become due and demandable

Persons earning minimum wage are excepted from income tax.

NON-DIMINUTION OF BENEFITS

General Rule: There is a prohibition against elimination or diminution of benefits (Art. 100) No wage order issued by any regional board shall provide for wage rates lower than the statutory minimum wage rates prescribed by Congress. (Art. 127, as amended by Republic Act

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No. 6727, June 9, 1989) REQUISITES (1) Ripened company policy (2) Practice is consistent and deliberate and (3) Not due to error in the construction or application of a doubtful or difficult question of law. (4) The diminution or discontinuance is done unilaterally by the employer. When not applicable: When at least one of the requisites is absent. (1) Mistake in the application of the law (2) Negotiated benefits (3) Reclassification of Positions – e.g. loss of some benefits by promotion. (4) Contingent or Conditional Benefits – the rule does not apply to a benefit whose grant depends on the existence of certain conditions, so that the benefit is not demandable if those preconditions are absent. Benefits initiated through negotiation between Employee and Employer, e.g. CBA, can only be eliminated or diminished bilaterally.

FACILITIES VS SUPPLEMENTS

The distinction between facilities and supplement is relevant because the former are wage-deductible while the latter is not. Simply put, a wage includes facilities. (Art. 97) The IRR definition (IRR Book III Rule 7-A Sec. 5) has 2 components: (1) Facilities are articles or services for the benefit of the employee or his family. This 1st part defines facilities. (2) Facilities shall not include tools of the trade or articles or service primarily for the benefit of the employer or necessary to the conduct of the employer’s business. This 2nd part is essentially defines what a supplement. Requirements for deducting value of facilities Mere availment is not sufficient to allow deductions from employees’ wages. Before the value of facilities can be deducted from the employees’ wages, the following requisites must all be attendant:

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(1) proof must be shown that such facilities are customarily furnished by the trade; (2) the provision of deductible facilities must be voluntarily accepted in writing by the employee; and (3) facilities must be charged at reasonable value.

WAGE DISTORTION/RECTIFICATION A situation where an increase in prescribed wage rates results in the elimination or severe contraction of intentional quantitative differences in wage or salary rates between and among employee groups in an establishment as to effectively obliterate the distinctions embodied in such wage structure based on skills, length of service, or other logical bases of differentiation (Art. 124) HOW TO RESOLVE Organized Establishment (1) Employer and the union shall negotiate to correct the distortions. (2) Disputes shall be resolved through the grievance procedure. (3) If still unresolved, voluntary arbitration. Grievance Procedure (under the CBA)  if unresolved, VOLUNTARY arbitration Unorganized Establishment (1) ERs and Employees shall endeavor to correct such distortions. (2) Disputes shall be settled through the National Conciliation and Mediation Board. (3) If still unresolved after 10 calendar days of conciliation, it shall be referred to the appropriate branch of the NLRC – compulsory arbitration o Both the employer and employee cannot use economic weapons. (4) Employer cannot declare a lock-out; Employee cannot declare a strike because the law has provided for a procedure for settling (5) The salary or wage differential does not need to be maintained. (National Federation of Labor v. NLRC, 1994) National Conciliation and Mediation Board  if unresolved, COMPULSORY arbitration by the

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NLRC CBA vis-à-vis Wage Orders – CBA creditability In determining an employee’s regular wage, the pertinent stipulations in the CBA are controlling, provided the result is not less than the statutory requirement (Philippine National Bank vs. PEMA, 1982)

DIVISOR TO DETERMINE DAILY RATE Suggested formula for computing the Estimated Equivalent Monthly Rate (EEMR) EEMR =(Applicable Daily Rate (ADR) x days/year) ÷ 12 For monthly-paid EEs Monthly-paid employees are those who are paid every day of the month, including unworked rest days, special days, and regular holidays. 365 days/year Where 365 296 days – days/year = 52 days – 12 days – 5 days –

ordinary working days rest days regular holidays special days

For daily-paid EEs Daily-paid employees are those who are paid on the days actually worked and on unworked regular holidays. (a) For those who are required to work every day including Sundays or rest days, special days and regular holidays: 394.1 days/year Where 296 days – 394.10 24 days – days = 67.60 days – 6.50 days –

ordinary working days 12 regular holidays x 200% 52 rest days x 130 % 5 special days x 130%

(b) For those who do not work and are not considered paid on Sundays or rest days: 313 days/year

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Where 313 296 days days = – 12 days – 5 days -

ordinary working days regular holidays special days (if considered paid; if actually worked, this is equivalent to 6.5 days)

(c) For those who do not work and are not considered paid on Saturdays and Sundays or rest days: 278 days/year Where 278 261 days days = – 12 days – 5 days -

ordinary working days regular holidays special days (if considered paid; if actually worked, this is equivalent to 6.5 days)

REST DAY WEEKLY REST DAY

It shall be the duty of every employer, whether operating for profit or not, to provide each of his employees a rest period of not less than twentyfour (24) consecutive hours after every six (6) consecutive normal work days. [Art. 91 (a)] Preference of the employee The employer shall determine and schedule the weekly rest day of his employees subject to collective bargaining agreement and to such rules and regulations as the Secretary of Labor and Employment may provide. However, the employer shall respect the preference of employees as to their weekly rest day when such preference is based on religious grounds. [Art. 94 (b)]

EMERGENCY REST DAY WORK

The employer may require his employees to work on any day: (a) In case of actual or impending emergencies caused by serious accident, fire, flood, typhoon, earthquake, epidemic or other disaster or calamity to prevent loss of life

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and property, or imminent danger to public safety; (b) In cases of urgent work to be performed on the machinery, equipment, or installation, to avoid serious loss which the employer would otherwise suffer; (c) In the event of abnormal pressure of work due to special circumstances, where the employer cannot ordinarily be expected to resort to other measures; (d) To prevent loss or damage to perishable goods; (e) Where the nature of the work requires continuous operations and the stoppage of work may result in irreparable injury or loss to the employer; and (f) Under other circumstances analogous or similar to the foregoing as determined by the Secretary of Labor and Employment. (Art. 92, LC)

HOLIDAY PAY/PREMIUM PAY

Holiday pay is a one-day pay given by law to an employee even if he does not work on a regular holiday. This gift of a day’s pay is limited to each of the 12 regular holidays.

COVERAGE

General Rule: All employees Exceptions: (1) Those of the government and any of the political subdivision, including governmentowned and controlled corporation; (2) Those of retail and service establishments regularly employing less than 10 workers; (3) Domestic helpers and persons in the personal service of another; (4) Managerial employees as defined in Book III (5) Field personnel and other employees whose time and performance is unsupervised by the employer including those who are engaged on task or contract basis, purely commission basis, or those who are paid a fixed amount for performing work irrespective of the time consumed in the performance thereof. (Sec. 1, Rule IV of the IRR) Retail Establishment is one principally engaged in the sale of goods to end-users for personal or household use;

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Service Establishment is one principally engaged in the sale of service to individuals for their own or household use and is generally recognized as such. (IRR of RA 6727/the Wage Rationalization Act) REGULAR HOLIDAYS Proclamation No. 655 signed by President Aquino on 25 September 2013, provides for the observance of the regular holidays and special (non-working) days for the year 2014 on the following dates: (1) New year’s Day - January 1 (2) Maundy Thursday – March 28 (3) Good Friday – March 29 (4) Araw ng Kagitingan – April 9 (5) Labor Day – May 1 (6) Independence Day – June 12 (7) National Heroes Day – August 26 (8) Bonifacio Day – November 30 (9) Christmas Day - December 25 (10) Rizal Day - December 30 (11) Eid’l Fitr – date to be determined later (12) Eid’l Adha – date to be determined later Special (Non-Working Days) (1) Chinese New Year – January 31 (2) Black Saturday – March 30 (3) Ninoy Aquino Day - August 21 (4) All Saints Day - November 1 (5) Additional special (Non-working) days (a) December 24 (b) December 26 (6) Last Day of the Year - December 31 Special Holiday (for all schools) EDSA Revolution Anniversary – February 25 P.D. 1083 (Code of Muslim Personal Laws) SEE: Arts. 169-173 Specifically for the Muslim Areas, P.D. 1083, in its Book V, Title, recognizes five (5) Muslim Holidays, namely: (1) Amun Jadid (New Year) which falls on the first (1st) day of the lunar month of Muharram; (2) Mauli-un-Nabi (Birthday of the Prophet Muhammad) which falls on the twelfth (12th) day of the third (3rd) lunar month of Rabi-ulAwwal;

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(3) Lailatul Isra Wal Mi Rai (Nocturnal Journey and Ascencion of the Prophet Muhammand) which falls on the twenty-seventh (27th) day of the seventh (7th) lunar month of Rajab; (4) Id-ul-Fitr (Hari Raja Pausa) which falls on the first (1st) day of the tenth (10th) lunar month of Shawwal commemorating the end of the fasting season; and (5) Id-ul-Adha (Hari Raha Haji) which falls on the tenth (10th) of the twelfth (12th) lunar month of Dhu’l-Hijja. Note: Id-ul-Fitr (Eid’l Fitr) and Id-ul-Adha (Eid’l Adha) have been added to the list of national legal holidays. Note: There should be no distinction between Muslims & non-Muslims as regards to the payment of benefits for Muslim holidays. Wages & other emoluments granted bylaw to the working manare determined on the basis of the criteria laid down by laws ¬ on worker’s faith.Art. 3(3), PD 1083 states that nothing herein shall be construed to operateto the prejudice of a non-Muslim. (San Miguel Corp vs. CA, 2002) HOLIDAY PAY COMPUTATION General Rule: An employer may require an employee to work on any holiday but such employee shall be paid a compensation equivalent to twice his regular rate. [Art. 94(b)] According to the LC, IRR and Memo: Work on any regular holiday, not exceeding 8 Computation hrs Work on any regular 200% of regular daily holiday, if it exceeds 8 wage (for the 1st 8 hours/overtime hours) + 30% of hourly rate on said day Work on any regular 200% of regular daily holiday which falls on wage + 30% of such the scheduled rest day, amount not exceeding 8 hours Work on any regular holiday which falls on scheduled rest day, if it exceeds 8

Regular holiday-onrest day rate (200% of regular daily wage plus 30% of such

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amount) + 30% of hourly rate on said day.

Work on special holiday Regular daily wage + not exceeding 8 hours 30% thereof Work on special holiday Regular daily wage + 50% thereof According to DOLE Memo Circular 1-04, a “special holiday”/”special day” includes the National Special Days, and declared special days such as Special Non-working Holiday, Special Public Holiday and Special National Holiday. Such days are entitled to the rates prescribed above. These days are not the same as a special working holiday. A special working holiday is considered an ordinary working day, so there is no premium pay. Double holiday pay According to “DOLE Explanatory Bulletin on Worker’s Entitlement to Holiday Pay on 9 April 1993,” if two holidays fall on the same day: (1) If unworked, 200% of basic wage. (2) If worked, 300% of basic wage. (Azucena) Double Holiday Rule for Monthly-paid employees For covered employees whose monthly salaries are computed based on 365 days and for those other employees who are paid using factor 314, or 262, or any other factor which already considers the payment for the 11 regular holidays, NO additional payment is due them. (BWC-WHSD Opinion No. 053, s. 1998) Successive holiday pay According to IRR, Rule IV, Sec. 10, an employee is entitled to holiday pay for both days, IF: (1) He is present on day immediately preceding first holiday; or (2) He works on first holiday, which entitles him to pay on second holiday. Divisors The divisor assumes an important role in determining whether or not holiday pay is already computed.

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(1) Monthly paid employees are not entitled to the holiday pay if their total annual income is divided by 365 days resulting in a wage which is beyond the minimum wage per day because they are considered paid everyday of the year including holidays, rest days, and other non-working days. The 365 days are as follows: 365 days = 296 days – ordinary days 52 days – rest days 12 days – regular holidays 5 days – special holidays (2) As a general rule, for a company with a 6day working schedule, the divisor 313 already means that the legal holidays are included in the monthly pay of the employee. The divisor is arrived at by subtracting all Sundays from the total number of calendar days in a year. (3) As a general rule for a company with a 5-day working schedule, the divisor 287 means that the holiday pay is already included in the monthly salary of the employee. Non-working/scheduled rest day Where the day immediately preceding the holiday is a non-working day in the establishment or the scheduled rest day of the employee, he shall not be deemed to be on leave of absence on that day, in which case he shall be entitled to the holiday pay if he worked on the day immediately preceding the nonworking day or rest day. [IRR, Book III, Rule V, Sec 6 (c)] RIGHT TO HOLIDAY PAY In case of absences All covered employees shall be entitled to the benefit provided herein when they are on leave of absence with pay. Employees who are on leave of absence without pay on the day immediately preceding a regular holiday may not be paid the required holiday pay if he has not worked on such regular holiday. [IRR, Book III, Rule IV, Sec 6(a)] In case of temporary cessation of work (a) In cases of temporary or periodic shutdown and temporary cessation of work of an establishment, as when a yearly inventory or when the repair or cleaning of machineries and equipment is undertaken, the regular

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holidays falling within the periods shall be compensated in accordance with this Rule. (b) The regular holiday during the cessation of operation of an enterprise due to business reverses as authorized by the Secretary of Labor may not be paid by the employer. (IRR, Book III, Rule IV, Sec 7) An employee is entitled to holiday pay for the regular holidays falling within the period in cases of temporary shutdowns or cessation of work, when: (1) an annual inventory; or (2) repair or cleaning of machineries and equipment is undertaken. The employer may not pay his employees for the regular holidays during the suspension of work if: the cessation of operation is due to business reverses, and is authorized by the Secretary of Labor.

TEACHERS, PIECE WORKERS, SEAFARERS, SEASONAL WORKERS, ETC.

Private school teachers, including faculty members of colleges and universities, may not be paid for the regular holidays during semestral vacations. They shall, however, be paid for the regular holidays during Christmas vacation; Where a covered employee, is paid by results or output, such as payment on piece work, his holiday pay shall not be less than his average daily earnings for the last seven (7) actual working days preceding the regular holiday; Provided, However, that in no case shall the holiday pay be less than the applicable statutory minimum wage rate. Seasonal workers may not be paid the required holiday pay during off-season when they are not at work o Workers who have no regular working days shall be entitled to the benefits provided in this Rule. (Book III, Rule IV, Sec. 8 of IRR) Piece workers Philosophy underlying the exclusion of piece workers from the 8-hour law is that said workers

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are paid depending upon the work they do irrespective of the amount of time employed in doing said work. (Red v. Coconut Products Ltd., v. CIR, 1966) Seafarers Any hours of work or duty including hours of watch-keeping performed by the seafarer on designated rest days and holidays shall be paid rest day or holiday pay. (Section 11.C, Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean-Going Vessels) Seasonal workers Seasonal workers who do not work during offseason are not entitled to pay for the regular holidays occurring during their off-season. Workers assigned to “skeleton crews” that work during the off-season have the right to be paid on regular holidays falling in that duration.

PREMIUM PAY

Premium pay refers to the additional compensation for work performed within 8 hours on non-work days, such as rest days and special days. COVERAGE (Book 3, Rule 3, Sec. 7 of the IRR) General Rule: All employees Exceptions: (1) Those of the government and any of the political subdivision, including government-owned and controlled corporations; (2) Managerial employees as defined in Book III; (3) Househelpers and persons in the personal service of another; (4) Workers who are paid by results, including those who are paid on piece rate, takay, pakyaw, or task basis, and other noontime work, if their output rates are in accordance with the standards prescribed in the regulations, or where such rates have been fixed by the Secretary of Labor and Employment; (5) Field personnel, if they regularly perform their duties away from the principal or branch office or place of business of the ER and whose actual hours of work in the filed cannot be determined with reasonable 27 of 92

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certainty. Premium pay rates (DOLE Memorandum Circular 1, Series of 2004) When work performed On scheduled rest day

Premium pay 30% of regular wage

On Sunday ONLY IF 30% of regular wage ESTABLISHED rest day No regular work and rest days

30% of regular wage for work performed on Sundays and holidays

On any special holiday/special day

30% of regular wage

On any special holiday /special day falling on scheduled rest day

50% of regular wage

On any regular holiday falling on scheduled rest day

230% of regular wage

Where the collective bargaining agreement or other applicable employment contract stipulates the payment of a higher premium pay than that prescribed under this Article, the employer shall pay such higher rate. (Art. 93 (d)) Nothing in this Rule shall justify an employer in reducing the compensation of his employees for the unworked Sundays, holidays, or other rest days which are considered paid-off days or holidays by agreement or practice subsisting upon the effectivity of the Code. (Book III, Rule III, Sec. 8 of the IRR) Nothing herein shall prevent the employer and his employees or their representatives in entering into any agreement with terms more favorable to the employees than those provided herein, or be used to diminish any benefit granted to the employees under existing laws, agreements, and voluntary employer practices. (Book III, Rule II, Sec. 9 of the IRR)

LEAVES SERVICE INCENTIVE LEAVE PAY

Every employee who has rendered at least one year of service shall be entitled to a yearly

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service incentive leave of five days with pay. (Art. 95(a)) Service Incentive Leave DOES NOT apply to the following employees: (1) Those of the government and any of its political subdivisions, including GOCCs; (2) Domestic helpers and persons in the personal service of another; (3) Managerial employees as defined in Book 3 of this Code; (4) Field personnel and other employees whose performance is unsupervised by the employer including those who are engaged on task or contract basis, purely commission basis, or those who are paid a fixed amount for performing work irrespective of the time consumed in the performance thereof; (5) Those who are already enjoying the benefit herein provided; (6) Those enjoying vacation leave with pay of at least 5 days; (7) Those employed in establishments regularly employing less than 10 employees. (Book 3, Rule 5, Sec. 1 of the IRR) Employer may require employee to work The employer may require an employee to work on any holiday but such employee shall be paid a compensation equivalent to twice his regular rate (Art. 95(b)) Meaning of “1 year of service” The term "at least one-year service" shall mean service for not less than 12 months, whether continuous or broken, reckoned from the date the employee started working, including authorized absences and paid regular holidays unless the working days in the establishment as a matter of practice or policy, or that provided in the employment contract is less than 12 months, in which case said period shall be considered as one year. (Book III, Rule V, Sec. 3 of the IRR) Entitlement The grant of benefit in excess of that provided herein shall not be made a subject of arbitration or any court or administrative action. (Art. 95 (c)) Commutable nature of benefit

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The service incentive leave shall be commutable to its money equivalent if not used or exhausted at the end of the year.

MATERNITY LEAVE

[Sec. 14-A of RA 1161 (Social Security Law) as amended by RA 7322 and RA 8282] COVERAGE Every pregnant woman in the private sector, whether married or unmarried, is entitled to the maternity leave benefits. This is applicable to both childbirth and miscarriage. Requisites: (1) Employment: A female employee employed at the time of delivery, miscarriage or abortion (2) Contribution: who has paid at least 3 monthly contributions in the 12-month period immediately preceding the semester of her childbirth, or miscarriage. (3) Notice: employee notified employer of her pregnancy and the probable date of her childbirth, which notice shall be transmitted to the SSS in accordance with the rules and regulations it may provide. Benefit received A daily maternity benefit equivalent to 100% of her average daily salary credit for: (1) 60 days for normal delivery (2) 78 days for caesarean delivery This benefit shall NOT be included in the computation of 13th month pay as it is granted to an employee in lieu of wages which is the basis for computing 13th month. Only 4 maternity leaves available The maternity benefits provided under the Social Security Law shall be paid only for the first four (4) deliveries or miscarriages SSS pays for the maternity leave The employer advances the benefit to the employee but the SSS shall immediately

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reimburse the employer of one hundred percent (100%) of the amount upon receipt of satisfactory proof of such payment and legality thereof Other conditions (1) Employer shall advance the payment subject to reimbursement by the SSS within 30 days from filing of leave application. (2) Availment shall be a bar to the recovery of sickness benefits provided by this Act for the same period for which daily maternity benefits have been received. (3) Employee may only avail of benefit for the first four (4) deliveries or miscarriages. (4) Sanction: That if an employee should give birth or suffer miscarriage (a) without the required contributions having been remitted for her by her ER to the SSS, or (b) without the latter having been previously notified by the ER of time of the pregnancy, then the employer shall pay to the SSS damages equivalent to the benefits which said employee member would otherwise have been entitled to.

PATERNITY LEAVE [RA 8187 (Paternity Leave Act of 1996)] Coverage and purpose Paternity leave is granted to all married male employees in the private and public sectors, regardless of their employment status (e.g. probationary, regular, contractual, project basis). The purpose of this benefit is to allow the husband to lend support to his wife during her period of recovery and/or in nursing her newborn child. (Sec. 3, RA 8187) Benefit It shall apply to the first 4 deliveries of the employee’s lawful wife with whom he is cohabiting. It shall be for 7 calendar days, with full pay, consisting of basic salary and mandatory allowances fixed by the Regional Wage Board, if any, provided that his pay shall not be less than the mandated minimum wage. (Sec. 2, RA 8187)

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Cohabiting means the obligation of the husband and wife to live together. If the spouses are not physically living together because of the workstation or occupation, the male employee is still entitled to the paternity leave benefit. (Sec. 1, IRR, RA 8187) Usage of the benefit Usage of the leave shall be after the delivery, without prejudice to an employer’s policy of allowing the employee to avail of the benefit before or during the delivery, provided that the total number of days shall not be more than 7 days for each covered delivery. (Sec. 5, IRR, RA 8187) Conditions for entitlement (Sec. 3, IRR, RA 8187) (1) He is married; (2) He is an employee at the time of the delivery of his child; (3) He is cohabiting with his spouse at the time that she gives birth or suffers a miscarriage; (4) He has applied for paternity leave with his ER within a reasonable period of time from the expected date of delivery by his pregnant spouse, or within such period as may be provided by company rules and regulations, or by CBA; and, (5) His wife has given birth or suffered a miscarriage. Application for paternity leave See number 4 under conditions for entitlement. In case of miscarriage, prior application for paternity leave shall not be required. (Sec. 4, IRR, RA 8187) Non-conversion to cash In the event that the paternity leave is not availed of, it shall not be convertible to cash and shall not be cumulative. (Sec. 7, IRR, RA 8187) Crediting of existing benefits (1) If the existing paternity leave benefit under the CBA, contract, or company policy is greater than 7 calendar days as provided for in RA 8187, the greater benefit shall prevail. (2) If the existing paternity leave benefit is less than that provided in RA 8187, the ER shall

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adjust the existing benefit to cover the difference. Where a company policy, contract, or CBA provides for an emergency or contingency leave without specific provisions on paternity leave, the ER shall grant to the employee 7 calendar days of paternity leave. (Sec. 9, IRR, RA 8187)

PARENTAL LEAVE

[RA 8972 (Solo Parents’ Welfare Act of 2000)] Leave benefits granted to a solo parent to enable him/her to perform parental duties and responsibilities where physical presence is required. [Sec. 3 (d), RA 8972] COVERAGE Any solo parent or individual who is left alone with the responsibility of parenthood due to: (1) Giving birth as a result of rape or and other crimes against chastity even without a final conviction of the offender: Provided, That the mother keeps and raises the child; (2) Death of spouse; (3) Spouse is detained or is serving sentence for a criminal conviction for at least one (1) year; (4) Physical and/or mental incapacity of spouse as certified by a public medical practitioner; (5) Legal separation or de facto separation from spouse for at least one (1) year: Provided, that he/she is entrusted with the custody of the children; (6) Declaration of nullity or annulment of marriage as decreed by a court or by a church: Provided, that he/she is entrusted with the custody of the children; (7) Abandonment of spouse for at least one (1) year; (8) Unmarried father/mother who has preferred to keep and rear his/her child/children, instead of having others care for them or give them up to a welfare institution; (9) Any other person who solely provides parental care and support to a child or children: Provided, that he/she is duly licensed as a foster parent by the Department of Social Welfare and

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Development (DSWD) or duly appointed legal guardian by the court; and (10) Any family member who assumes the responsibility of head of family as a result of the death, abandonment, disappearance, or prolonged absence of the parents or solo parent for at least one (1) year. [Sec. 3 (a), RA 8972] Conditions for entitlement A solo parent employee shall be entitled to the parental leave under the following conditions: (1) He/she has rendered at least one (1) year of service, whether continuous or broken; (2) He/she has notified his/her employer that he/she will avail himself/herself of it, within a reasonable period of time; and (3) He/she has presented to his/her employer a Solo Parent Identification Card, which may be obtained from the DSWD office of the city or municipality where he/she resides. (Sec 19, Art. V, IRR, RA 8972) Availment The parental leave is in addition to leave privileges under existing laws with full pay, consisting of basic salary and mandatory allowances. It shall not be more than seven (7) working days every year. (Sec. 8, RA 8972) Grant of flexible work schedule The employer shall provide for a flexible working schedule for solo parents: Provided, That the same shall not affect individual and company productivity: Provided, further, That any employer may request exemption from the above requirements from the DOLE on certain meritorious grounds. (Sec. 6, RA 8972) Protection against work discrimination No employer shall discriminate against any solo parent employee with respect to terms and conditions of employment on account of his/her status. (Sec. 7, RA 8972) Termination of the benefit A change in the status or circumstance of the parent claiming the benefit under the law, such that he/she is no longer left alone with the responsibility of parenthood, shall terminate his/her eligibility for these benefits. [Sec. 3 (a), RA 8972]

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LEAVES FOR VICTIMS OF VIOLENCE AGAINST WOMEN

[RA 9262 (Anti-Violence against Women and Their Children Act of 2004)] Coverage and purpose VAWC leave is granted to women employees who are victims of violence, as defined in RA 9262. The leave benefit covers the days that the women employee has to attend to medical or legal concerns. Requirement for entitlement To be entitled to the leave benefit, the only requirement is for the victim-employee to present to her employer a certification from the barangay chairman or barangay councilor or prosecutor or the Clerk of Court, as the case may be, that an action relative to the matter is pending. Benefit In addition to other paid leaves under existing labor laws, company policies, and/or CBA, the qualified victim-employee shall be entitled to a leave of up to 10 days with full pay, consisting of basic salary and mandatory allowances fixed by the Regional Wage Board, if any. Usage of the benefit The usage of the 10-day leave shall be at the option of the woman employee. In the event that the leave benefit is not availed of, it shall not be convertible into cash and shall not be cumulative. A victim of VAWC who is employed shall be entitled to a paid leave of up to ten (10) days in addition to other paid leaves under the Labor Code and Civil Service Rules and Regulations and other existing laws and company policies: (1) At any time during the application of any protection order, investigation, prosecution and/or trial of the criminal case, extendible when the necessity arises as specified in the protection order. (2) Upon the issuance of the Punong Barangay/kagawad or prosecutor or the Clerk of Court, as the case may be, of a certification (at no cost) to the woman that such an action is pending, and this is all that 31 of 92

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is required for the employer to comply with the 10- day paid leave. (3) For government employees, in addition to the aforementioned certification, the employee concerned must file an application for leave citing as basis R.A. 9262. (Sec. 42, IRR, RA 8972)

SPECIAL LEAVE BENEFITS (SLB) FOR WOMEN [RA 9710 (The Magna Carta of Women), DOLE DO No. 112, Series of 2011 as amended by DO No. 112-A Series of 2012]

Special leave benefit for women – a female employee’s leave entitlement of two (2) months with full pay from her employer based on her gross monthly compensation following surgery caused by gynecological disorders, provided that she has rendered continuous aggregate employment service of at least six (6) months for the last 12 months. Gynecological disorders – disorders that would require surgical procedures such as, but not limited to, dilatation and curettage and those involving female reproductive organs such as the vagina, cervix, uterus, fallopian tubes, ovaries, breast, adnexa and pelvic floor, as certified by a competent physician. It shall also include hysterectomy, ovariectomy, and mastectomy. Gross monthly compensation – the monthly basic pay plus mandatory allowances fixed by the regional wage boards. (Sec. 7, Rule II, IRR, RA 9710) At least six months continuous aggregate employment service for the last 12 months prior to surgery – the woman employee should have been with the company for 12 months prior to surgery. An aggregate service of at least six (6) months within the said 12-month period is sufficient to entitle her to avail of the special leave benefit. Employment service - includes absences with pay such as use of other mandated leaves, company-granted leaves and maternity leaves Competent physician - a medical doctor preferably specializing in gynecological UP LAW BOC

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disorders or is in the position to determine the period of recuperation of the woman employee. (Sec. 1, DO 112, as amended) Conditions for entitlement of special leave Any female employee, regardless of age and civil status, shall be entitled to a special leave benefit, provided she has complied with the following conditions: (1) She has rendered at least 6 months continuous aggregate employment service for the last 12 months prior to surgery; (2) She has filed an application for special leave (3) She has undergone surgery due to gynecological disorders as certified by a competent physician. (Sec. 2, DO 112) Application for special leave Application before surgery The employee shall file her application for leave with her employer within a reasonable period of time from the expected date of surgery, or within such period as may be provided by company rules and regulations or by CBA. Application after surgery Prior application for leave shall not be necessary in cases requiring emergency surgical procedure, provided that the employer shall be notified verbally or in written form within a reasonable period of time and provided further that after the surgery or appropriate recuperating period, the female employee shall immediately file her application using the prescribed form. (Sec. 3, DO 112) Period of entitlement The 2 months special leave is the maximum period of leave with pay that a woman employee may avail of under RA 9710. For purposes of determining the period of leave with pay that will be allowed to a female employee, the certification of a competent physician as to the required period of recuperation shall be controlling. (Sec. 4, DO 112, as amended) Availment The special leave shall be granted to the qualified employee after she has undergone surgery. (Sec. 5, DO 112, as amended)

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Frequency of availment A woman employee can avail of the SLB for every instance of surgery due to gynecological disorder for a maximum total period of 2 months per year. (Sec. 6, DO 112, as amended) Special leave benefit vis-à-vis SSS sickness benefit The SLB is different from the SSS sickness benefit. The former is granted by the employer in accordance with RA 9710. It is granted to a woman employee who has undergone surgery due to gynecological disorder. The SSS sickness benefit, on the other hand, is administered and given by the SSS in accordance with RA 1161 as amended by RA 8282. (Sec. 7, DO 112, as amended) Special leave benefit vis-à-vis existing statutory leaves The SLB cannot be taken from existing statutory leaves (i.e. 5-day SIL, leave for victims of VAWC, Parental leave for solo parents). The grant of SLB under the law is in recognition of the fact that patients with gynecological disorder needing surgery require a longer period of recovery. The benefit is considered an addition to the leave benefits granted under existing laws and should be added on top of said statutory leave entitlements. If the SLB has already been exhausted, the company leave and other mandated leave benefits may be availed of by the woman employee. (Sec. 8, DO 112, as amended) Special leave benefit vis-à-vis maternity leave benefit Where the woman employee had undergone surgery due to gynecological disorder during her maternity leave, she is entitled only to the difference between the SLB and maternity leave benefit. (Sec. 9, DO 112, as amended) Crediting of existing or similar benefits If there are existing or similar benefits under a company policy, practice or CBA providing similar or equal benefits to what is mandated by law, the same shall be considered as

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compliance, unless the company policy, practice or CBA provides otherwise. In the event the company policy, practice or CBA provides lesser benefits, the company shall grant the difference. More liberal existing or similar benefits cannot be withdrawn or reduced by reason of the mandate of RA 9710. The term “similar or equal benefits” refers to leave benefits, which are of the same nature and purpose as that of the SLB. (Sec. 10, DO 112, as amended) Mode of payment The SLB is a leave privilege. The woman employee shall not report for work for the duration of the leave but she will still receive her salary covering said period. The employer, in its discretion, may allow said employee to receive her pay for the period covered by the approved leave before or during the surgery. The computation of her “pay” shall be based on her prevailing salary at the time of the surgery. (Sec. 11, DO 112, as amended) Non-commutation of the benefit The SLB shall be non-cumulative and nonconvertible to cash unless otherwise provided by a CBA (Sec. 12, DO 112, as amended)

SERVICE CHARGES COVERAGE

Employers (Sec 1, Rule VI, Book 3, IRR) This rule shall apply only to establishments which collect service charges such as: (a) Hotels, restaurants, lodging houses, night clubs, cocktail lounge, massage clinics, bars, casinos and gambling houses and similar enterprises (b) Including those entities operating primarily as private subsidiaries of the Government Employees Shall apply to ALL employees of covered employers (a) Regardless of their positions, designations, or employment status,

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(b) Irrespective of the method by which their wages are paid.

EXCEPTIONS

Managerial employees – or one who is vested with powers or prerogatives to lay down and execute managerial policies and/or hire, transfer, suspend, layoff, recall, discharge, assign or discipline employees or to effectively recommend such managerial actions. All employees not falling within this definition shall be considered rank-and-file employees. (Sec 2, Rule VI, Book 3, IRR) Distribution Service charges are distributed in accordance with the following percentage of sharing: (1) Eighty-five percent (85%) for the employees to be distributed equally among them; (2) Fifteen percent (15%) for the management to answer for losses and breakages and, at the discretion of the management, distribution to managerial employees. (Sec 3, Rule VI, Book 3, IRR) The shares shall be distributed to employees not less than once every 2 weeks or twice a month at intervals not exceeding 16 days. (Sec 4, Rule VI, Book 3, IRR) Note: The P2,000.00 salary ceiling for entitlement thereto is no longer applicable. Integration In case service charge is abolished shares of covered employees shall be considered integrated in their wages. (Art 96) The basis of the amount to be integrated shall be the average monthly share of each employee for the past twelve (12) months immediately preceding the abolition of withdrawal of such charges. (Sec. 5, Rule VI, Book 3, IRR) SYNTHESIS OF THE RULES (1) Service charges must be pooled; (2) Where a restaurant or similar establishment does not collect service charges but has a practice or policy of monitoring and pooling tips given voluntarily by its customers to its employees, the pooled tips should be monitored, accounted for and distributed in

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the same manner as the services charges. (DOLE Handbook on Workers’ Statutory Monetary Benefits, 2014ed.) (3) The amount collected is divided between the company (15%) and employees (85%); (4) It shall be given twice a month with intervals of not more than 15 days; (5) If discontinued, removed, or stopped, the average share of the employees of their service charge or tips shall be integrated with their basic wage.

THIRTEENTH (13TH) MONTH PAY & OTHER BONUSES

(PD 851 (The 13th-Month Pay Law) and the Revised Guidelines on the Implementation of the 13th Month Pay Law)

COVERAGE

General Rule: ALL EMPLOYERS are hereby required to pay all their rank and file employees a 13th month pay not later than Dec 24 of every year, Provided that they have worked for at least one (1) month during a calendar year. Exempted Employers: (1) Government, its political subdivisions, including GOCCs except those operating essentially as private subsidiaries of the Government; (2) Employers already paying their employees a 13th month pay or more in a calendar year or its equivalent at the time of this issuance; (3) Employers of household helpers and persons in the personal service of another relation to such workers; and (4) Employers of those who are paid on purely commission, boundary or task basis and those who are paid a fixed amount for performing specific work, irrespective of the time consumed in the performance thereof (except those workers who are paid on piecerate basis, in which case their employer shall grant them 13th month pay). “Equivalent” includes: (a) Christmas bonus, mid-year bonus, cash bonuses (b) and other payments amounting to not less than 1/12 of the basic salary (c) but shall NOT INCLUDE cash and stock

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dividends, cost of living allowances and all other allowances regularly enjoyed by the employee as well a non-monetary benefits. Workers paid on a piece-rate basis Those who are paid a standard amount for every piece or unit of work produced that is more or less regularly replicated, without regard to the time spent in producing the same. Minimum Amount: 1/12 of the total basic salary earned by an employee within a calendar year BASE AMOUNT, which is the basic salary shall include: (1) cost of living allowances (COLA) integrated into the basic salary of a covered employee pursuant to EO 178. (2) all remunerations or earnings paid by this employer for services rendered. (3) But not the allowances and monetary benefits which are not considered or integrated as part of the regular or basic salary, such as the cash equivalent of: (a) unused vacation and sick leave credits, (b) overtime, (c) premium, (d) night differential, (e) holiday pay and, and (f) cost-of-living allowances.

TIME OF PAYMENT

General Rule: paid not later than Dec 24 of each year. Exception: ER may give to his employees half (½) of the required 13th Month Pay before the opening of the regular school year and the other half on or before the 24th of December every year. The frequency of payment of this monetary benefit may be the subject of agreement between the employer and the recognized CBA of the employees. 13TH MONTH PAY IN SPECIAL CASES (1) Paid by Results: Employees who are paid on piece work basis are, by law, entitled to the 13th Month Pay. (Revised Guidelines on the Implementation of the 13th Month Pay Law)

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(2) Fixed or Guaranteed Wage: Employees who are paid a fixed or guaranteed wage plus commission are entitled to 13th month pay (not purely commission); the basis for computation shall be both their fixed or guaranteed wage and commission. (Revised Guidelines) (3) Those with Multiple Employers: Government Employees working part time in a private enterprise, including private educational institutions, as well as Employees working in two or more private firms, whether on full or part time bases, are entitled to the required 13th Month Pay from all their private Employers regardless of their total earnings from each or all their employers. (Revised Guidelines) (4) Private School Teachers: Private school teachers, including faculty members of universities and colleges, are entitled to the required 13th month pay, regardless of the number of months they teach or are paid within a year, if they have rendered service for at least one (1) month within a year. (Revised Guidelines) (5) Resigned or Separated Employee: An Employee who has resigned or whose services were terminated at any time before the time for payment of the 13th month pay is entitled to this monetary benefit in proportion to the length of time he worked during the year, reckoned from the time he started working during the calendar year up to the time of his resignation or termination from service. (Revised Guidelines) (6) Wage Difference: The difference between the minimum wage and the actual salary received by the Employee cannot be deemed as his 13th month pay as such difference is not equivalent to or of the same import as the said benefit contemplated by law. (JPL Marketing Promotions vs CA, 2005) (7) Terminated Employees: The payment of the 13th month pay may be demanded by the employee upon the cessation of employeremployee relationship. (Archilles Manufacturing Corp. vs NLRC, 1995)

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ADDITIONAL RULES: (1) Commissions: If the commissions may be properly considered part of the basic salary, then they should be INCLUDED. If they are not an integral part of the basic salary, then they should be EXCLUDED. (Phil. Duplicators Inc. vs NLRC, 1995) (2) Substitute Payment not allowed: Benefits in the form of food or free electricity, assuming they were given, were not a proper substitute for the 13th month pay required by law. Neither may year-end rewards for loyalty and service be considered in lieu of 13th month pay. (Framanlis Farms, Inc. vs MOLE, 1989) (3) 14th Month Pay is not mandated: Employers already paying their employees a 13th month pay or its equivalent are not covered by this Decree. (Kamaya Point Hotel vs NLRC, 1989)

SEPARATION PAY (Art. 283 & 284, LC, DOLE Handbook on Worker’s Statutory Monetary Benefits, 2014) General rule: The rule embodied in the Labor Code is that a person dismissed for cause as defined therein (see Art. 282) is not entitled to separation pay. (PLDT vs NLRC, 1988) Exception: Considerations of equity and the employee was not dismissed on the ground of misconduct or for cause reflecting his moral character.

AMOUNT

ONE-HALF (1/2) MONTH PAY PER YEAR OF SERVICE An EE is entitled to receive separation pay equivalent to ½ month pay for every year of service, a fraction of at least six (6) months being considered as one whole year, if his/her separation from the service is due to any of the following authorized causes: (1) Retrenchment to prevent losses (i.e. reduction of personnel effected by management to prevent losses); (2) Closure or cessation of operation of an establishment not due to serious losses or financial reverses; and, (3) When the EE is suffering from a disease not curable within a period of six (6) months and his/her continued employment is prejudicial

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to his/her health or to the health of his/her co-employees In no case will an EE get less than one (1) month separation pay if the separation is due to the above stated causes and he/she has served for at least six (6) months. (DOLE Handbook on Workers’ Statutory Monetary Benefits, 2014 ed.) ONE-MONTH PAY PER YEAR OF SERVICE An EE is entitled to separation pay equivalent to his/her one-month pay for every year of service, a fraction of at least 6 months being considered as one whole year, if his/her separation from service is due to any of the following: (1) Installation by ER of labor-saving devices; (2) Redundancy, as when the position of the EE has been found to be excessive or unnecessary in the operation of the enterprise; (3) Impossible reinstatement of the EE to his/her former position or to a substantially equivalent position for reasons not attributable to the fault of the ER, as when the reinstatement ordered by a competent authority cannot be implemented due to closure of cessation of operations of the establishment/ER, or the position to which he/she is to be reinstated no longer exists and there is no substantially equivalent position in the establishment to which he/she can be assigned. (Gaco vs NLRC, 1994) BASIS OF SEPARATION PAY The computation of separation pay of an EE shall be based on his/her latest salary rate. (DOLE Handbook on Workers’ Statutory Monetary Benefits, 2014 ed.) INCLUSION OF REGULAR ALLOWANCE IN THE COMPUTATION In the computation of separation pay, it would be error not to integrate the allowance with the basic salary. The salary base properly used in computing the separation pay should include not just the basic salary but also the regular allowances that an EE has been receiving. (Planters’ Products, Inc. vs NLRC, 1989)

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RETIREMENT PAY (RA 7641 - The Retirement Pay Law)

ELIGIBILITY

All employees in the private sector, regardless of their position, designation, or status, and irrespective of the method by which their wages are paid (Sec. 1, IRR, RA 7641) The only exceptions are: (1) employees covered by the Civil Service Law; (2) domestic helpers and persons in the personal service of another, and (3) employees in retail, service and agricultural establishments or operations regularly employing not more than ten employees (Sec. 2, IRR, RA 7641) Exclusions from coverage R.A. No. 7641, otherwise known as "The Retirement Pay Law," only applies in a situation where (1) there is no collective bargaining agreement or other applicable employment contract providing for retirement benefits for an employee; OR (2) there is a collective bargaining agreement or other applicable employment contract providing for retirement benefits for an employee, but it is below the requirements set for by law. AGE OF RETIREMENT Optional retirement – in the absence of a retirement plan or other applicable agreement providing for retirement benefits of EEs in an establishment, an EE may retire upon reaching the age of 60 or more if he has served for at least 5 years in said establishment. Compulsory retirement – in the absence of a retirement plan or other applicable agreement providing for retirement benefits of EEs in an establishment, an EE shall be retired at the age of 65 years. (Sec. 4, IRR, RA 7641)

AMOUNT OF RETIREMENT PAY

The minimum retirement pay shall be equivalent to one-half (1/2) month salary for every year of service, a fraction of at least six (6) months being considered as one whole year.

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For the purpose of computing retirement pay, “one-half month salary” shall include all of the following: (1) Fifteen (15) days salary based on the latest salary rate; (2) Cash equivalent of five (5) days of service incentive leave; (3) One-twelfth (1/12) of the 13th month pay. (1/12 x 365/12 = .083 x 30.41 = 2.52) Thus, “one-half month salary” is equivalent to 22.5 days. (Capitol Wireless, Inc. vs Sec. Confessor, 1996) Other benefits may be included in the computation of the retirement pay upon agreement of the ER and the EE or if provided in the CBA. Retirement Benefits under a CBA or Applicable Contract Any EE may retire or be retired by his/her ER upon reaching the age established in the CBA or other applicable agreement/contract and shall receive the retirement benefits granted therein; provided, however, that such retirement benefits shall not be less than the retirement pay required under RA 7641, and provided further that if such retirement benefits under the agreement are less, the ER shall pay the difference. Where both the ER and the EE contribute to a retirement fund pursuant to the applicable agreement, the ER’s total contributions and the accrued interest thereof should not be less than the total retirement benefits to which the EE would have been entitled had there been no such retirement benefits’ fund. If such total portion from the ER is less, the ER shall pay the deficiency.

RETIREMENT BENEFITS WORKERS WHO ARE PAID RESULTS

OF BY

For covered workers who are paid by result and do not have a fixed monthly salary rate, the basis for the determination of the salary for 15 days shall be their average daily salary (ADS).

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The ADS is derived by dividing the total salary or earning for the last 12 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 established regulations

RETIREMENT BENEFIT OF PARTTIME WORKERS Part-time workers are also entitled to retirement pay of “one-month salary” for every year of service under RA 7641 after satisfying the following conditions precedent for optional retirement: (a) There’s no retirement plan between the ER and the EE; and, (b) The EE should have reached the age of 60 years, and should have rendered at least 5 years of service with the ER. 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. (DOLE Handbook on Workers’ Statutory Monetary Benefits, 2014 ed.)

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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.

TAXABILITY (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 (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

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WOMEN WORKERS PROVISIONS DISCRIMINATION

AGAINST

It shall be unlawful for any employer to discriminate against any woman employee with respect to terms and conditions of employment solely on account of her sex. The following are acts of discrimination: (1) Payment of a lesser compensation, including wage, salary or other form of remuneration and fringe benefits, to a female employees as against a male employee, for work of equal value; and (2) Favoring a male employee over a female employee with respect to promotion, training opportunities, study and scholarship grants solely on account of their sexes. (Art.133)

STIPULATION AGAINST MARRIAGE It shall be unlawful for an employer to: (a) require as a condition of employment or continuation of employment that a woman employee shall not get married, or (b) stipulate expressly or tacitly that upon getting married a woman employee shall be deemed resigned or separated or (c) actually dismiss, discharge, discriminate or otherwise prejudice a woman employee merely by reason of her marriage. (Art. 134) Exceptions: (1) Reasonable demands of business require the distinction based on marital status AND there is no better available policy to accomplish the business purpose. (2) Spouse is an employee of the competitor

PROHIBITED ACTS (Art. 135) Note: Nightwork/ Exception (Art 130-131) – No more nightwork prohibition under R.A. 10151. Discrimination (Art 133, RA 9710) See previous section Stipulation against marriage (Art 134) See previous section

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Discharge to prevent enjoyment of benefits To deny any woman employee the benefits provided for in this Chapter or to discharge any woman employed by him for the purpose of preventing her from enjoying any of the benefits provided under this Code. [Art. 135 (1)] Discharge on account of pregnancy To discharge such woman on account of her pregnancy, while on leave or in confinement due to her pregnancy. [Art. 135 (2)] Discharge on account of testimony To discharge or refuse the admission of such woman upon returning to her work for fear that she may again be pregnant. [Art. 137 (3)] It shall be unlawful for any employer: …to discharge any woman or child or any other employee for having filed a complaint or having testified or being about to testify under the Code [Book III, Rule XII, Sec 13(d), IRR] Expulsion of Women faculty/ female student due to pregnancy outside of marriage Expulsion and non-readmission of women faculty due to pregnancy outside of marriage shall be outlawed. No school shall turn out or refuse admission to a female student solely on the account of her having contracted pregnancy outside of marriage during her term in school. [Sec. 13(c), RA 9710]

ANTI-SEXUAL HARASSMENT

(RA 7877 - Anti-Sexual Harassment Act of 1995) FORMS OF SEXUAL HARASSMENT (1) Employment or Work Related (a) The sexual favor is made as a condition (i) in the hiring or in the employment, reemployment or continued employment of said individual or (ii) in granting said individual favorable compensation, terms, conditions, promotions, or privileges, or (iii) in the refusal to grant the sexual favor results in limiting, segregating or classifying the EE which in any way would discriminate, deprive or diminish employment opportunities or otherwise adversely affect said employee;

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(b) The above acts would either: (i) impair the employee’s rights or privileges under existing labor laws; or (ii) result in an intimidating, hostile, or offensive environment for the employee. (2) Education or Training environment. In an education or training environment, sexual harassment is committed: (a) Against one who is under the care, custody or supervision of the offender (b) Against one whose education, training, apprenticeship or tutorship is entrusted to the offender; (c) When the sexual favor is made a condition to the giving of a passing grade, or the granting of honors and scholarships, or the payment of a stipend, allowance or other benefits, privileges, or considerations; or (d) When the sexual advances result in an intimidating, hostile or offensive environment for the result, trainee or apprentice. PERSONS WHO MAY BE LIABLE (1) Any employer, employee, manager, supervisor, agent of the employer, teacher, instructor, professor, coach, trainer or any other person, regardless of whether the demand, request for requirement for submission is accepted by the object of said act having authority, influence or moral ascendancy over another in a work or training or education environment, who demands, requests or otherwise requires any sexual favor from another, (2) Any person who directs or induces another to commit any act of sexual harassment as herein defined. OR (3) Any person who cooperates in the commission by another without which it would NOT have been committed, shall also be held liable under this Act (Sec. 3, RA 7877) ROLE OF THE EMPLOYER OR HEAD OF OFFICE The Employer or Head of Office shall have the duty: (1) to prevent the commission of such acts and

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(2) to lay down the procedure for the resolution, settlement or prosecution of committed acts. (Sec. 4, RA 7877) He shall be solidarily liable for damages: (1) if he is informed of such acts by the offended party and (2) no immediate action is taken thereon. (Sec. 5, RA 7877) INDEPENDENT ACTION FOR DAMAGES The victim of work, education or training-related sexual harassment can institute a separate and independent action for damages and other affirmative relief. (Sec. 6, RA 7877) Sanctions (1) Criminal: imprisonment of 1 month to mos. Or fine of P10k to P20k or both *Prescription of such action is in 3 years. (2) Termination (Sec. 7, RA 7877)

MINOR WORKERS Relevant Laws: RA 7610 (Special Protection of Children Against Abuse, Exploitation and Discrimination Act), RA 9231 (Special Protection of Children Against Child Abuse, Exploitation and Discrimination Act), Art. 137(a) Constitutional basis: Art II, Sec. 13 of the 1987 Constitution 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. General Rule: Children below 15 shall NOT be employed Exceptions (1) Child works directly under the sole responsibility of his parents or legal guardian and where only members of the ER’s family are employed, provided: (a) his employment does NOT endanger his life, safety, health and morals, 40 of 92

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(b) nor impairs his normal development, and (c) the parent or legal guardian shall provide the said minor child with the prescribed primary and/or secondary education; (Sec. 12 of RA 7610 as amended by RA 7658) (2) Child’s employment or participation in public entertainment or information through cinema, theater, radio or television is essential, provided that: (a) employment does NOT involve ads or commercials promoting alcohol, tobacco and its by-products or violence [Sec. 14 of RA 7610] (b) the employment contract is concluded by the child’s parents or guardian, and approved by DOLE (c) The ER shall ensure the protection, health, safety and morals of the child (d) The ER shall institute measures to prevent the child’s exploitation or discrimination taking into account the system and level of remuneration, and the duration and arrangement of working time (e) The ER shall formulate and implement, subject to the approval and supervision of competent authorities, a continuing program for training and skills acquisition of the child. (Sec. 12 of RA 7610 as amended by RA 7658) EMPLOYMENT OF CHILDREN FROM 15 - 18 Employment is allowed but restricted to nonhazardous work. Non-hazardous work shall mean any work or activity in which the EE is not exposed to any risk which constitutes an imminent danger to his safety and health. (Sec. 3, Rule XII, Book III, IRR of LC) The Secretary of Labor shall from time to time publish a list of hazardous work and activities in which persons 18 years of age and below cannot be employed (Sec. 3, Rule XII, Book III, IRR of LC) The following are HAZARDOUS workplaces: (1) Nature of the work exposes the workers to dangerous environmental elements, contaminants or working conditions;

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(2) construction work, logging, fire-fighting, mining, quarrying, blasting, stevedoring, dock work, deep sea fishing, and mechanized farming; (3) manufacture or handling of explosives and other pyrotechnic products; (4) exposure to or use of heavy power-driven machinery or equipment; (5) exposure to or use of power-driven tools WORKING HOURS OF A CHILD Quantity Age Bracket

Daily Max

Below 15 y/o

4 hours

20 hours

15 to below 18

8 hours

40 hours

Night work prohibition Age Bracket

Weekly Mac

Prohibited Hours

Below 15 y/o

8pm to 6am (10hrs)

15 to below 18

10pm to 6am (8hrs)

EMPLOYMENT HOUSEHELPERS

OF

RA 10361 (Batas Kasambahay or Domestic Worker’s Act) has expressly repealed Chapter III, “Employment of Househelpers”, Title III of Book III of the LC. Domestic work This refers to work performed in or for a household or households. (Sec 4(C). RA 10361) Domestic worker or “Kasambahay” Refers to any person engaged in domestic work within an employment relationship such as, but not limited to, the following: general househelp, nursemaid or “yaya”, cook, gardener, or laundry person. (Sec 4(D). RA 10361) The term domestic worker or “kasambahay” excludes any person who performs domestic work only occasionally or sporadically and not on an occupational basis. (Sec.4(D), RA 10361)

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RIGHTS & PRIVILEGES

(1) Minimum wage The minimum wage of domestic workers shall not be less than the following: (a) P2,500/month: employed in NCR (b) P2,000/ month: employed in chartered cities and first class municipalities (c) P1,500/month: employed in other municipalities (d) Within one year from the effectivity of the Act, and periodically thereafter, the Regional Tripartite and Productivity Wage Boards shall review, and if proper, determine and adjust the minimum wage rates of domestic workers. (Sec. 24, RA 10361) (2) Standard of Treatment The employer or any member of the household shall not subject a domestic worker or “kasambahay” to any kind of abuse nor inflict any form of physical violence or harassment or any act tending to degrade the dignity of a domestic worker. (Sec. 5, RA 10361) (3) Board, Lodging and Medical Attendance The employer shall provide for the basic necessities of the domestic worker to include at least three (3) adequate meals a day and humane sleeping arrangements that ensure safety and shall provide appropriate rest and assistance to the domestic worker in case of illnesses and injuries sustained during service without loss of benefits. (Sec. 6, RA 10361) (4) Privacy Respect for the privacy of the domestic worker shall be guaranteed at all times and shall extend to all forms of communication and personal effects (Sec. 7, RA 10361) (5) Access to Outside Communication The employer shall grant the domestic worker access to outside communication during free time: Provided, That in case of emergency, access to communication shall be granted even during work time. (Sec. 8, RA 10361)

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(6) Education and Training The employer shall afford the domestic worker the opportunity to finish basic education and may allow access to alternative learning systems and, as far as practicable, higher education or technical and vocational training. (Sec. 9, RA 10361) (7) Social and Other Benefits A domestic worker who has rendered at least one (1) month of service shall be covered by the Social Security System (SSS), the Philippine Health Insurance Corporation (PhilHealth), and the Home Development Mutual Fund or Pag-IBIG, and shall be entitled to all the benefits in accordance with the pertinent provisions provided by law. (8) Leave Benefits A domestic worker who has rendered at least one (1) year of service shall be entitled to an annual service incentive leave of five (5) days with pay (Sec. 29, RA 10361)

PRE-EMPLOYMENT REQUIREMENT

Prior to the execution of the employment contract, the employer may require the following from the domestic worker: (a) Medical certificate or a health certificate issued by a local government health officer; (b) Barangay and police clearance; (c) National Bureau of Investigation (NBI) clearance; and (d) Duly authenticated birth certificate or if not available, any other document showing the age of the domestic worker such as voter’s identification card, baptismal record or passport. However, Section 12(a), (b), (c) and (d) shall be standard requirements when the employment of the domestic worker is facilitated through the PEA. The cost of the foregoing shall be borne by the prospective employer or agency, as the case may be. (Sec. 12, RA 10361)

TIME & MANNER OF PAYMENT:

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domestic worker through a written consent, employer shall make no deductions from the wages other than that which is mandated by law. (Sec. 25, RA 10361) Right against assignment to non-household work at a wage rate lower than that mandated for agricultural or non-agricultural enterprises depending on the case. (Sec. 22, RA 10361) Employment Age of Domestic Workers: Unlawful to employ any person below fifteen (15) years of age as a domestic worker (Sec. 16, RA 10361) Persons between 15-18 years old should only be employed in non-hazardous work. (DO 4-99 Sec. 4) Daily Rest Period: Aggregate of eight (8) hours per day. (Sec. 20, RA 10361) Employment Certification: ER shall give the househelper a written statement of the nature and duration of the service and his or her work performance as househelper upon severance. (Sec. 35, RA 10361)

TERMINATION (1) Initiated by the domestic worker (at any time) (a) Verbal or emotional abuse of the domestic worker by the employer or any member of the household; (b) Inhuman treatment including physical abuse of the domestic worker by the employer or any member of the household; (c) Commission of a crime or offense against the domestic worker by the employer or any member of the household; (d) Violation by the employer of the terms and conditions of the employment contract and other standards set forth under this law; (e) Any disease prejudicial to the health of the domestic worker, the employer, or member/s of the household; and (f) Other causes analogous to the foregoing. (Sec. 33, RA 10361) (2) Initiated by the employer (at any time) (a) Misconduct or willful disobedience by the domestic worker of the lawful order of the

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employer in connection with the former’s work; (b) Gross or habitual neglect or inefficiency by the domestic worker in the performance of duties; (c) Fraud or willful breach of the trust reposed by the employer on the domestic worker; (d) Commission of a crime or offense by the domestic worker against the person of the employer or any immediate member of the employer’s family; (e) Violation by the domestic worker of the terms and conditions of the employment contract and other standards set forth under this law; (f) Any disease prejudicial to the health of the domestic worker, the employer, or member/s of the household; and (g) Other causes analogous to the foregoing. (Sec. 34, RA 10361) UNJUST DISMISSAL Neither the domestic worker nor the employer may terminate the contract before the expiration of the term except for grounds provided in Sec. 33 and 34 of RA 10361. If the domestic worker is unjustly dismissed, the domestic worker shall be paid the compensation already earned plus the equivalent of 15 days work by way of indemnity. Leaving without justifiable reason by the domestic worker (1) Any unpaid salary due not exceeding the equivalent 15 days work shall be forfeited AND (2) The employer may recover from the domestic worker the costs incurred related to the deployment expenses, if any: Provided, that the service has been terminated within 6 months from the domestic worker’s employment. Notice to end the working relationship If the duration of the domestic service is not determined either in stipulation or by the nature of the service, the employer or the domestic worker may give notice to end the working

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relationship five (5) days before the intended termination of the service. The domestic worker and the employer may mutually agree upon written notice to preterminate the contract of employment to end the employment relationship. (Sec. 32, RA 10361)

EMPLOYMENT HOMEWORKERS

OF

LIABILITY OF EMPLOYER

DO 5, DOLE (February 4, 1992), is now Rule XIV, Book III of the IRR. Industrial homework A system of production under which work for an ER or contractor is carried out by a homeworker at his/her home. (1) Materials may or may not be furnished by the ER or contractor. (2) Decentralized form of production, where there is ordinarily very little supervision or regulation of methods of work. (Sec. 2(a), Rule XIV, Book III, IRR) Industrial Homeworker means a worker who is engaged in industrial homework Employer means any person who (1) Acts as a contractor – delivers or causes to be delivered any goods, articles, or materials to be processed or fabricated in or about a home and thereafter to be returned or to be disposed of or distributed in accordance with ER’s direction; OR (2) Sells any goods, articles, or materials to be processed or fabricated in or about a home and then rebuys them after. (Art. 153, LC) Sec 2(d), Rule XIV, Book III is substantially similar to the above.

RIGHTS & BENEFITS HOMEWORKERS

of the certification of registration (Sec 4, Rule XIV, Book III, IRR) (3) Immediate payment upon ER’s receipt of finished goods or articles (Sec 6, Rule XIV, Book III, IRR) (4) SSS, MEDICARE and ECC premium contributions shall be deducted from their pay and shall be remitted by ER/contractor/subcontractor to the SSS (Sec 6, Rule XIV, Book III, IRR) (1) ER may require homeworker to redo work improperly executed without additional pay (Sec 9a, Rule XIV, Book III, IRR) (2) ER need not pay homeworker for any work done on goods or articles not returned due to homeworker’s fault (Sec 9b, Rule XIV, Book III, IRR) (3) If subcontractor/contractor fails to pay homeworker, ER is jointly and severally liable with the former to the homeworker for his/her wage (Sec 11, Rule XIV, Book III, IRR) (4) ER shall assist the homeworkers in the maintenance of basic safe and healthful working conditions at the homeworkers’ place of work. (Sec 11, Rule XIV, Book III, IRR of LC) Regional Office shall provide technical assistance to registered homeworkers’ organizations (Sec 14, Rule XIV, Book III, IRR of LC)

PROHIBITED HOMEWORK

Homework is prohibited in the ff: (1) explosives, fireworks and articles of like character; (2) drugs and poisons; and (3) other articles, the processing of which requires exposure to toxic substances. (Sec 13, Rule XIV, Book III, IRR)

ACCORDED

(1) Right to form, join or assist organizations (Sec 3, Rule XIV, Book III, IRR) (2) Right to acquire legal personality and the rights and privileges granted by law to legitimate labor organizations upon issuance

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Conditions for deduction from homeworker’s earnings No deduction from the homeworker’s earnings for the value of materials lost, destroyed or damaged unless: (1) Homeworker is clearly shown to be responsible for loss or damage (2) Reasonable opportunity to be heard (3) Amount of deduction is fair and reasonable, and does not exceed actual loss or damage (4) Deduction does not exceed 20% of homeworker’s weekly earnings (Sec. 8, Rule XIV, Book III, IRR)

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(2) Possess vocational aptitude and capacity for appropriate tests; (3) Possess the ability to comprehend and follow oral and written instructions. (Art. 59 of the LC, as amended by R.A. 7610). (4) Physically fit for occupation EMPLOYMENT OF APPRENTICES: When applicable: (1) Only employers in highly technical industries may employ apprentices; and (2) Only in apprenticeable occupations approved by the Secretary of Labor. (Art. 60, LC)

Relevant Law: RA 7796 (Technical Education and Skills Development Act of 1994 or TESDA Act of 1994)

PERIOD The period of apprenticeship shall not exceed six months.

APPRENTICES

ENFORCEMENT No person shall institute any action for the enforcement of any apprenticeship agreement or damages for breach of any such agreement, unless he has exhausted all available administrative remedies. (Art. 67, LC)

Art. 58 has been superseded by Section 4 (j), (k), (l), (m) of RA 7796 quoted below: (j)"Apprenticeship" training within employment with compulsory related theoretical instruction involving a contract between an apprentice and an employer on an approved apprenticeable occupation. (k)“Apprentice" is a person undergoing training for an approved apprenticeable occupation during an apprenticeship agreement. (l)"Apprenticeship Agreement" is a contract wherein a prospective employer binds himself to train the apprentice who in turn accepts the terms of training for a recognized apprenticeable occupation emphasizing the rights, duties and responsibilities of each party. (m)“Apprenticeable Occupation” is an occupation officially endorsed by a tripartite body and approved to be apprenticeable by the authority. (Sec. 4, RA 7796) Integrating both the abovementioned provisions then the qualifications of an apprentice are as follows: (1) At least 15 years of age (as amended by R.A. 7610), provided that if he is below 18 years, he shall not be eligible for hazardous occupation;

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SUMMARY OF RULES: (1) The apprentice must be paid not less than 75% of the prescribed minimum salary (Art. 61); HOWEVER, the employer MAY NOT pay any wage if the apprenticeship training is: (a) part of the school curriculum, (b) a requirement for graduation, or (c) a requirement for board examination (Art. 72) (2) The apprenticeship agreement must be approved by the DOLE Secretary (without such one shall be deemed a regular employee) (Nitto Enterprises v. NLRC, G.R. No. 114337, Sept. 29, 1995); (3) The employer is not compelled to continue one’s employment upon termination of apprenticeship; (4) One-half (1/2) of the value of labor training expenses incurred for developing the productivity and efficiency of apprentices of the training cost is deducted from the employer’s income tax but it shall not exceed 10% of direct labor wage (Art. 71)

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Working scholars – there is no employeremployee relationship between students on one hand, and schools, colleges or universities on the other, 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, provided, the students are given real opportunities, including such facilities as may be reasonable and necessary to finish their chosen courses under such agreement. (Sec. 14, Rule X, IRR)

LEARNERS

Persons hired as trainees in semi-skilled and other industrial occupations which are nonapprenticeable. Learnership programs must be approved by the authority. (Sec. 4, RA 7796) Occupations which may be learned through practical training on the job in a relatively short period of time which shall not exceed three (3) months. (Art. 73(2), LC) When may learners be hired (1) No experienced workers are available; (2) The employment of learners being necessary to prevent the curtailment of employment opportunities; and (3) The employment will neither create unfair competition in terms of labor costs nor impair working standards. (Art. 74, LC) Learnership Agreement Any employer desiring to employ learners shall enter into a learnership agreement with them, which agreement shall include: (1) The names and addresses of the learners; (2) The duration of the learnership period, which shall not exceed three (3) months; (3) The wages or salary rates of the learners which shall begin at not less than seventyfive percent (75%) of the applicable minimum wage; and (4) A commitment to employ the learners if they so desire, as regular employees upon completion of the learnership. All learners who have been allowed or suffered to work during the first two (2) months shall be deemed regular employees if training is terminated by the employer before the end of the stipulated period through no fault of the learners.

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The learnership agreement shall be subject to inspection by the Secretary of Labor and Employment or his duly authorized representative. (Art. 75, LC) Learners employed in piece or incentive-rate jobs during the training period shall be paid in full for the work done. (Art. 76, LC)

HANDICAPPED WORKERS – DIFFERENTLY-ABLED WORKERS (RA 7277 - Magna Carta for Disabled Persons, as amended by RA 9442)

Disabled Persons are those suffering from restriction or different abilities, as a result of a mental, physical or sensory impairment, to perform an activity in the manner or within the range considered normal for a human being [Sec. 4(a), RA 7277] Impairment is any loss, diminution or aberration of psychological, physiological, or anatomical structure or function [Sec. 4(b), RA 7277] Disability shall mean: (a) physical or mental impairment that substantially limits one or more psychological, physiological or anatomical function of an individual or activities of such individual; OR (b) a record of such an impairment; OR (c) being regarded as having such an impairment [Sec 4(c), RA 7277] Handicap refers to a disadvantage for a given individual, resulting from an impairment or a disability that limits or prevents the function, or activity that is considered normal given the age and sex of the individual. [Sec 4(d), RA 7277]

RIGHTS OF DISABLED WORKERS

(1) Equal opportunity for employment (2) Reserved contractual positions (3) 5% of all casual, emergency and contractual positions in the DSWD; DOH, DepEd; and other government agencies, offices or corporations engaged in social development [Sec 5 (par. 2), RA 7277] (4) Sheltered employment

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(5) Apprenticeship opportunity (6) Full minimum wage (Sec 6, Wage Order No. NCR-17, May 17, 2012)

Termination of Employment EMPLOYER-EMPLOYEE RELATIONSHIP FOUR-FOLD TEST (1) Selection and engagement of the employee; (2) Payment of wages; (3) Power of dismissal; and (4) Employer’s power to control the employee’s conduct with respect to the means and methods by which the work is to be accomplished. (Brotherhood Labor Unity Movement of the Philippines et. al. v. Zamora, G.R. No. 48645, Jan. 7, 1987). Power to control is the most important element. (Sonza v. ABS-CBN Broadcasting Corp, G.R. No. 138051, June 10, 2004) ECONOMIC DEPENDENCE TEST (1) First Tier: Control Test (refer to the Four-Fold Test) (2) Second Tier: The underlying economic realities of the activity or relationship: whether the worker is dependent on the alleged employer for his continued employment in that line of business.

KINDS OF EMPLOYMENT

PROBATIONARY EMPLOYMENT Probationary employment shall not exceed 6 months from the date the employee started working, unless it is covered by an apprenticeship agreement stipulating a longer period. The services of an employee who has been engaged on a probationary basis may be terminated for a just cause or when he fails to qualify as a regular employee in accordance with reasonable standards made known by the employer to the employee at the time of his engagement. An employee who is allowed to

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work after a probationary period shall be considered a regular employee. (Art. 281, LC) In all cases of probationary employment, the employer shall make known to the employee the standards under which he will qualify as regular employee at the time of his engagement. Where no standards are made known to the employee at the time of engagement, he shall be deemed a regular employee. [IRR, Book VI, Rule 1, Sec. 6(d)] TERMINATION Can only be terminated for: (1) Just causes; or (2) Failure to qualify as a regular employee in accordance with reasonable standards made known by the employer to the employee at the time of engagement. The probationary employee is entitled to substantial and procedural due process before termination. DURATION General Rule: Probationary employment shall not exceed six (6) months from the date the employee started working. Exceptions: (1) When the parties to an agreement contract otherwise: (2) When the same is established by company policy; (3) When the same is required by the nature of the work performed by the employee; and (4) When it is covered by an apprenticeship agreement stipulating a longer period REGULAR EMPLOYMENT There are two separate instances whereby it can be determined that an employment is regular: (1) The particular activity performed by the employee is necessary or desirable in the usual business or trade of the employer; (2) The employee has been performing the job for at least a year. Standard of determination (Reasonable Connection rule) The primary standard in determining regular employment is the reasonable connection

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between the particular activity performed by the employee in relation to the usual business or trade of the employer. The connection can be determined by considering the nature of the work performed and its relation to the scheme of the particular business or trade in its entirety. The repeated and continuing need for the performance of the job has been deemed sufficient evidence of the necessity, if not indispensability of the activity to the business. (Lopez vs. MWSS, 2005)

indefinite period. If they are employed in a particular project, the completion of the project or any phase thereof will not mean severance of the employer-employee relationship. (Aguilar Corp. vs. NLRC, 1997)

Length of time involved Length of time is not controlling, merely serves as a badge of regular employment. (Maraguinot vs. NLRC, 1998)

If there is continuous rehiring of employees showing no intent to employ them for only one season, laws for regular employees must be applied.

PROJECT EMPLOYMENT Employment fixed on a specific project or undertaking, completion or termination of which is determined at the time of engagement of the employee.

CASUAL EMPLOYMENT When not a regular, project or seasonal employee.

Whether or not the project has a direct relation to the business of the ER is not important, BUT: (1) EE must be informed of the nature and duration of project (2) project and principal business of ER are two separate things (3) no attempt to deny security of tenure to the worker Work pool employee A project EE or a member of a work pool may acquire the status of a regular employee when the following concur: (1) There is a continuous rehiring of project employees even after cessation of a project; and (2) The tasks performed by the alleged “project employee” are vital, necessary, and indispensable to the usual business or trade of the employer. However, the length of time during which the EE was continuously rehired is not controlling, but merely serves as a badge of regular employment. Members of a work pool from which a construction company draws its project employees, if considered employees of the construction company while in the work pool, are non-project employees, or employees for an

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SEASONAL EMPLOYMENT (1) Work or services performed are seasonal in nature. (2) Employed only for the duration of one season.

To become regular employee: (1) one (1) year service, continuous or broken (2) with respect to activity employed (3) employment shall continue while such activity exists FIXED-TERM EMPLOYMENT Article 280 of the Labor Code does not proscribe or prohibit an employment contract with a fixed period provided the same is entered into by the parties, without any force, duress or improper pressure being brought to bear upon the employee and absent any other circumstance vitiating consent. Agreement should not violate security of tenure This arrangement does NOT circumvent Security of Tenure when: (1) Knowingly and voluntarily agreed upon by the parties without any force, duress, or improper pressure or any other circumstances vitiating his consent; OR (2) The employer and the employee dealt with each other on more or less equal terms with no moral dominance exercised by the former or the latter. (Brent School v. Zamora, 1990; Romares v. NLRC, 1998; Medenilla v. Phil. Veterans Bank, 2000) (3) If a contract is for a fixed term and the Employee is dismissed without just cause, he is entitled to the payment of his salaries

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corresponding to the unexpired portion of the employment contract. (Medenilla v. Phil. Veterans Bank, 2000)

JOB CONTRACTING

Articles 106 to 109 of the Labor Code Article 106. Contractor or subcontractor. Whenever an employer enters into a contract with another person for the performance of the former’s work, the employees of the contractor and of the latter’s subcontractor, if any, shall be paid in accordance with the provisions of this Code. In the event that the contractor or subcontractor fails to pay the wages of his employees in accordance with this Code, the employer shall be jointly and severally liable with his contractor or subcontractor to such employees to the extent of the work performed under the contract, in the same manner and extent that he is liable to employees directly employed by him. The Secretary of Labor and Employment may, by appropriate regulations, restrict or prohibit the contracting-out of labor to protect the rights of workers established under this Code. In so prohibiting or restricting, he may make appropriate distinctions between labor-only contracting and job contracting as well as differentiations within these types of contracting and determine who among the parties involved shall be considered the employer for purposes of this Code, to prevent any violation or circumvention of any provision of this Code. There is "labor-only" contracting where the person supplying workers to an employer does not have substantial capital or investment in the form of tools, equipment, machineries, work premises, among others, and the workers recruited and placed by such person are performing activities which are directly related to the principal business of such employer. In such cases, the person or intermediary shall be considered merely as an agent of the employer who shall be responsible to the workers in the same manner and extent as if the latter were directly employed by him. Article 107. Indirect employer. The provisions of the immediately preceding article shall likewise

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apply to any person, partnership, association or corporation which, not being an employer, contracts with an independent contractor for the performance of any work, task, job or project. Article 108. Posting of bond. An employer or indirect employer may require the contractor or subcontractor to furnish a bond equal to the cost of labor under contract, on condition that the bond will answer for the wages due the employees should the contractor or subcontractor, as the case may be, fail to pay the same. Article 109. Solidary liability. The provisions of existing laws to the contrary notwithstanding, every employer or indirect employer shall be held responsible with his contractor or subcontractor for any violation of any provision of this Code. For purposes of determining the extent of their civil liability under this Chapter, they shall be considered as direct employers. DEPARTMENT ORDER NO. 18-A, SERIES OF 2011: Rules Implementing Articles 106 to 109 of the LC, as amended (14 November 2011) Cabo – a persons or group of persons or a labor groups which, in the guise of a labor organization, cooperative or any entity, supplies workers to an employer, with or without any monetary or other consideration, whether in the capacity of an agent of the employer or as an ostensible independent contractor. Contracting or subcontracting – an arrangement whereby a principal agrees to put out or farm out with a contractor the performance or completion of a specific job, work or service within a definite or predetermined period, regardless of whether such job, work or service is to be performed or completed within or outside the premises of the principal. Contractor – any person or entity, including a cooperative, engaged in a legitimate contracting or subcontracting arrangement providing either services, skilled worker, temporary workers or a combination of services to a principal under a Service Agreement. 49 of 92

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Contractor’s employee – includes one employed by a contractor to perform or complete a job, work, or service pursuant to a Service Agreement with a principal. It shall also refer to regular EEs of the contractor whose functions are not dependent on the performance or completion of a specific job, work or service within a definite period of time i.e. administrative staff. In-house agency – a contractor which is owned, managed, or controlled directly or indirectly by the principal or one where the principal owns/represents any share of stock, and which operates solely or mainly for the principal. Net Financial Contracting Capacity (NFCC) – refers to the formula to determine the financial capacity of the contractor to carry out the job, work or services sought to be undertaken under a Service Agreement. Formula

NFCC = (current assets - current liabilities) x (K – value of all outstanding or ongoing projects including contracts to be started) ** K stands for contract duration equivalent to: a. 10 for one year or less b. 15 for more than 1 year up to 2 years c. 20 for more than 2 years Principal – any ER, whether a person or entity, including government agencies and GOCCs, who/which puts out or farms out a job, service or work to a contractor. Right to control – the right reserved to the person for whom the services of the contractual workers are performed, to determine not only the end to be achieved, but also the manner and means to be used in reaching that end. Substantial capital – refers to paid-up capital stocks/shares of at least P3,000,000 in the case of corporations, partnerships and cooperatives; in case of single proprietorship, a net worth of at least P3,000,000. (Sec 3, D.O. 18-A-11)

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Service agreement – refers to the contract between the principal and contractor containing the terms and conditions governing the performance or completion of a specific job, work or service being farmed out for a definite or predetermined period. Legitimate contracting or subcontracting Contracting or subcontracting shall be legitimate if ALL the following circumstances occur: (1) The contractor must be registered in accordance with these rules and carries a distinct and independent business (2) The contractor undertakes to perform the job, work or service on its own responsibility, according to its own manner and method, and free from control and direction of the principal in all matters connected with the performance of the work except as to the results thereof; (3) The contractor has substantial capital and/or investment; and (4) The Service Agreement ensures compliance with all the rights and benefits under Labor laws. Prohibition against labor-only contracting Labor only contracting is prohibited. There is labor-only contracting where: (1) The contractor does not have substantial capital or investments in the form of tools, equipment, machineries, work premises, among others, and the employees recruited and places are performing activities which are usually necessary or desirable to the operation of the company, or directly related to the main business of the principal within a definite or predetermined period, regardless of whether such job, work or service is to be performed or completed within or outside the premises of the principal; OR (2) The contractor does not exercise the right to control the performance of the work of the employee. Rights of contractor’s EEs All contractor’s EEs, whether deployed or assigned ass reliever, seasonal, week-ender, temporary, or promo jobbers, shall be entitled to all the rights and privileges as provided for in the LC, as amended.

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Security of tenure of contractor’s EEs It is understood that all contractor’s EEs enjoy security of tenure regardless of whether the contract of employment is co-terminus with the service agreement, or for a specific job, work, or service, or phase thereof. Effect of termination of employment The termination of the contractor EE prior to the expiration of the Service Agreement shall be governed by Arts. 282-284 of the LC. In case the termination is caused by the pretermination of the Service Agreement not due to authorized causes under Art. 283, the right of the contractor EE to unpaid wages and other unpaid benefits including unremitted legal mandatory contributions, e.g., SSS, Philhealth, Pag-ibig, ECC, shall be borne by the party at fault, without prejudice to the solidary liability of the parties to the Service Agreement. Where the termination result from the expiration of the Service Agreement, or from the completion of the phase of the job, work or service for which the EE is engaged, the latter may opt for payment of separation benefits as may be provided by law or the Service Agreement, without prejudice to his/her entitlement to the completion bonuses or other emoluments, including retirement benefits whenever applicable. Mandatory registration It shall be mandatory for all persons or entities, including cooperative, acting as contractors, to register with the Regional Office of the DOLE where it principally operates. Failure to register shall give rise to the presumption that the contractor is engaged in labor-only contracting. Contracting or subcontracting arrangements in the Construction & other industries Contracting or subcontracting arrangements in the Construction Industry, under the licensing coverage of the Philippine Construction Accreditation Board (PCAB), shall be covered by the applicable provisions of these Rules and shall continue to be governed by Dept Order

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No. 19, Series of 1993 (Guidelines Governing the Employment of Workers in the Construction Industry) Dept. Order No 13, Series of 1998 (Guidelines Governing the Occupational Safety and Health in the Construction Industry); DOLEDPWH-DILG-DTI and PCAB Memorandum of Agreement-Joint Administrative Order No. 1, Series of 2011 (on coordination and harmonization of policies and programs on occupational safety and health in the construction industry. DEPARTMENT CIRCULAR NO. 01, SERIES OF 2012: Clarifying the Applicability of DO No. 18A, 2011 to Business Processing Outsourcing (BPO)/ Knowledge Process Outsourcing (KPO) and the Construction Industry Applicability to BPO DO 18-A speaks of a trilateral relationship that characterizes the covered contracting/subcontracting arrangement. Thus, vendor-vendee relationship for entire business processes covered by the applicable provisions of the Civil Code on Contracts is excluded. DO 18-A contemplates generic or focused singular activity in one contract between the principal and the contractor (for example, janitorial, security, merchandising, specific production work) and does not contemplate information technology-enabled services involving an entire process (for example, BPO, KPO, legal process outsourcing, hardware and/or software support, medical transcription, animation services, back office operations/support). These companies engaged in BPOs may hire employees in accordance with applicable laws, and maintain these EEs based on business requirements, which may or may not be for different clients of the BPOs at different periods of the EE’s employment. Applicability to the Construction Industry Licensing and the exercise of regulatory powers over the construction industry is lodged with PCAB which is under the Construction Industry Authority of the Philippines and not with the DOLE or any of its regional offices. Thus, the DOLE, through its regional offices shall not require contractors licensed by PCAB

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in the Construction Industry to register under DO 18-A. Moreover, findings of violation/s on labor standards and occupational health and safety standards shall be coordinated with PCAB for its appropriate action, including the possible cancellation/suspension of the contractor’s license. EFFECTS OF FINDING THAT THERE IS LABOR-ONLY CONTRACTING A finding by a competent authority of labor-only contracting shall render the principal jointly and severally liable with the contractor to the latter’s EEs, in the same manner and extent that the principal is liable to EEs directly hired by him/her. A finding of commission of any of the prohibited activities in Sec. 7 or violation of either Secs. 8 or 9 hereof, shall render the principal the direct ER of the EEs of the contractor or subcontractor. (Sec. 27, DO 18-A, 2011) TRILATERAL RELATIONSHIP IN CONTRACTING ARRANGEMENTS There are three parties involved: (1) Principal – who decides to farm out a job, work or service to a contractor; (2) Contractor – who has the capacity to independently undertake the performance of the job, work, or service; and (3) Contractual workers – engaged by the contractor to accomplish the job, work or service. (Sec. 3 D.O. 18-A-11) In legitimate contracting there exists: (1) An ER-EE relationship between the contractor and the employees it engaged to perform the specific job, work or service being contracted (2) A contractual relationship between the principal and the contractor as governed by the provisions of the CC. In the event of any violation of any provisions of the LC (including 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 LC and other social legislation, to the extent of the worked performed under the employment contract. (Sec. 5, D.O. 18-A-11)

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DISMISSAL FROM EMPLOYMENT Art. 279: In case of regular employment, the employer shall not terminate the services of an employee except for (a) just cause (Art. 282) (b) authorized cause (Art. 283-284) Security of Tenure Right not be removed from one’s job without valid cause and valid procedure. (Kiamco v. NLRC, 1999) COVERAGE 1987 Constitution: all workers (Art. XIII Sec. 3) Labor Code: regular employees (Art. 279) in all establishments or undertakings, whether for profit or not (Art. 278), except government and its political subdivisions including government owned or controlled corporations or GOCCs (IRR Book VI Rule I Sec. 1) REQUISITES FOR THE VALIDITY OF MANAGEMENT PREROGATIVE AFFECTING SECURITY OF TENURE (1) Exercised in good faith for the advancement of the Employer's interest, and (2) NOT for the purpose of defeating or circumventing the rights of the Employees under special laws or under valid agreements (San Miguel vs. Ople, 1989) Just Causes Serious Misconduct

Requisites Serious (1) Grave and aggravated character, (2) In connection with work; and (3) Shows that Employee is unfit to work for Employer.

Willful Willful conduct – wrongful and Disobedience perverse attitude; and Order violated must be: (1) Reasonable, (2) Lawful, (3) Sufficiently known to Employee,

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service, whichever is higher

(4) In connection to the duties. Redundancy Gross and Habitual Neglect

Neglect must be both gross and habitual.

Fraud or Loss of Confidence Willful Breach (1) Committed against the of Trust Employer or his representative (direct); (2) willful since fraud implies wrongful intent; (3) EE concerned holds a position of trust and confidence (Mabeza vs. NLRC, 1997); (4) Act complained of must be work-related. Additional Guidelines (1) NOT simulated; (2) NOT used as a subterfuge; (3) NOT arbitrarily asserted; & (4) genuine, NOT a mere afterthought (Vitarich v. NLRC, 1999; CocaCola Bottlers, Phils., Inc. v. Kapisanan ng Malayang Manggagawa sa Coca-Cola, 2005)

Commission of a crime or offense against Employer

Crime against the (1) Employer, (2) Immediate member of employer’s family, or (3) Employer’s duly authorized representative; and Conviction or prosecution NOT required.

Analogous causes

Due to a voluntary and/or willful act or omission by Employee (Nadura vs. Benguet Consolidated, 1962)

Authorized causes

Requisites

Installation of (1) 1 month written notice to Labor Saving DOLE and Employee Devices (2) separation pay equivalent to one month pay or one month pay for every year of

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(1) 1 month written notice to DOLE and Employee (2) separation pay equivalent to one month pay or one month pay for every year of service, whichever is higher; (3) Good faith in abolishing the redundant positions; and (4) Fair and reasonable criteria in choosing those affected (Asian Alcohol Corp. v. NLRC, 1999), such as but not limited to: preferred status (e.g. temporary, casual or regular Employees) efficiency, or seniority. (Panlilio v. NLRC, 1997; Golden Thread Knitting Industries, Inc. v. NLRC, 1999)

Retrenchment

(1) Necessary to prevent or minimize losses and such losses are proven (2) 1 month written notice to DOLE and the Employees (3) Separation pay equivalent to at least one month pay or at least 1/2 month pay for every year of service, whichever is higher; (4) Exercise is in good faith; and (5) Fair and reasonable criteria in ascertaining who will be affected (a) preferred status (e.g. temporary, casual or regular Employees) (b) efficiency, (c) physical fitness, (d) age, (e) financial hardship, or (f) seniority. (Asian Alcohol Corp. v. NLRC, 1999) General Standards: When retrenchment is preventive rather than curative (1) Losses expected are

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substantial and not merely de minimis in extent; (2) Apprehended losses are reasonably imminent; (3) Retrenchment must be reasonably necessary to prevent the expected losses; and (4) Expected or actual losses must be proved by sufficient and convincing evidence. (Lopez Sugar Corp. vs. Federation of Free Workers, 1990)

Closure or Cessation of Operations

Disease

(1) Must be done in good faith (bona fide) (2) 1 month written notice to DOLE and Employee (3) Separation pay equivalent to one month pay or 1/2 month pay for every year of service, whichever is higher.

A very basic requirement of substantive due process; it has to be observed. Indeed, the rights to counsel and to due process of law are two of the fundamental rights guaranteed by the 1987 Constitution to any person under investigation, be the proceeding administrative, civil, or criminal. (Salaw v. NLRC, 1991) Procedural Due Process Employee must be given notice with adequate opportunity to be heard before he/she is notified of his/her actual dismissal for Cause. (Fujitsu v. CA, 2005) ER may NOT substitute the required prior notice & opportunity to be heard with the mere payment of 30 days' salary. (PNB v. Cabanag, 2005) TWIN-NOTICE REQUIREMENT First notice – notice specifying the grounds for which dismissal is sought Second notice – notice of the decision to dismiss

(1) Employee is suffering from any disease; (2) His continued employment is prohibited by law or is prejudicial to his health as well as as to the health of his coemployees. (Art. 284) (3) Separation pay equivalent to at least one month pay or at least 1/2 month pay for every year of service, whichever is higher; and (4) Medical certification by a competent public health authority that the disease cannot be cured within 6 mos even with proper medical treatment. (IRR Book VI Rule I Sec. 8)

DUE PROCESS

Substantive Due Process Dismissal for any of the just or authorized causes under Arts. 282 – 284 Right to counsel

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Procedure to be observed in termination cases Basis for Requirements Termination Just cause – (1) Notice specifying the grounds for which dismissal Art. 282 is sought

(2) Hearing or opportunity to be heard (3) Notice of the decision to dismiss (Art. 277(b))

Authorized Notice to: Cause – (1) Employee, & Arts. 283 & 284 (2) DOLE at least 1 month prior to the effectivity of the separation Consequences for non-compliance Effect Situation Liability of ER Just or Dismissal No liability Authorized valid * separation pay if Cause + Due for authorized Process cause No Just or Dismissal Reinstatement + Authorized invalid Full Backwages Cause * if reinstatement + Due Process NOT possible = separation pay No Just or Dismissal Reinstatement + Authorized invalid Full Backwages Cause + No * if reinstatement Due Process NOT possible = separation pay Just or Dismissal Liable for damages Authorized valid due to nonCause + No compliance with Due Process procedural req'ts *separation pay if for authorized cause HEARING; MEANING OF OPPORTUNITY TO BE HEARD A formal or trial type hearing is not at all times and in all instances essential to due process; it is enough to that the parties are afforded fair and reasonable opportunity to explain their side of the controversy. (Mendoza vs. NLRC, 1991)

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Degree of Proof Substantial evidence; proof beyond reasonable doubt not required. (Manila Electric Co., Inc. v. NLRC, 1991) Agabon doctrine Prior to 1989

Illegal dismissal

Wenphil Corp. v. NLRC, 1989 - Belated Due Process Rule

Dismissal isvalid (NO reinstatement and backwages) BUT Employer to indemnify Employee for damages

Serrano v. NLRC, 2000

Dismissal is valid. EE is entitled to the payment of full backwages - Computed from the time of dismissal until the Court finds the dismissal to be for just cause.

Current rule: Dismissal is valid (NO Agabon v. reinstatement and NLRC, 2004 backwages) BUT Employer to indemnify Employee in the form of nominal damages Indemnity is stiffer than Wenphil Corp. vs. NLRC to discourage the practice of “dismiss now, pay later”.

RELIEFS DISMISSAL

FOR

ILLEGAL

A finding of illegal dismissal entitles the Employee to: (1) Reinstatement without loss of seniority rights and privileges, and (2) Full backwages inclusive of allowances and to benefits or their monetary equivalent from the time withheld up to actual reinstatement (Art. 279)

REINSTATEMENT

It is the restoration of an employee who was unjustly dismissed to the position from which he was removed, that is, to his status quo ante dismissal (Santos vs. NLRC, 1987)

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Alternative to Reinstatement In lieu of reinstatement, Employee is entitled to separation pay of 1 month pay per year of service. (Gaco vs. NLRC, 1994) General Rule: Reinstatement is a matter of right to an illegally dismissed Employee. Exceptions: (1) Closure of business (Retuya vs. Dumarpa, 2003) (2) Economic business conditions: The reinstatement remedy must always be adapted to economic-business conditions. (Union of Supervisors v. Sec. of Labor, 1984) (3) EE’s unsuitability (Divine World High School vs. NLRC, 1986) (4) EE’s Retirement/Coverage (Espejo vs. NLRC, 1996) Prescription Period An action for reinstatement by reason of illegal dismissal is one based on an injury which may be brought within 4 years from the time of dismissal.(Art. 1146 of the Civil Code) REINSTATEMENT PENDING APPEAL Art. 223 is clear that an award for reinstatement shall be immediately executory even pending appeal and the posting of a bond by the employer shall not stay the execution for reinstatement. SEPARATION PAY IN LIEU OF REINSTATEMENT Strained Relation rule If reinstatement is not feasible, expedient, or practical, as where there is strained relations between the parties, particularly where the illegally dismissed employee held a managerial or key position (Quijano v. Mercury Drug Corp. 1998) Kinds of separation pay (1) SP as a statutory requirement for authorized causes (2) SP as financial assistance found in the next section (3) SP in lieu of reinstatement where reinstatement is not feasible; and (4) SP as a benefit in the CBA or company policy

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SP as a statutory requirement is computed by integrating the basic salary with regular allowances employee has been receiving (Planters Products Inc. v. NLRC, 1989); allowances include transportation and emergency living allowances (Santos v. NLRC, 1987)

BACKWAGES

According to St. Theresa’s School of Novaliches Foundation v. NLRC (1998), backwages are earnings lost by a worker due to his illegal dismissal; a form of relief that restores the income lost by reason of such unlawful dismissal; it is not private compensation or damages; nor is it a redress of a private right but, rather, in the nature of a command to the employer to make a public reparation for illegally dismissing an employee. Effect of failure to order backwages A “plain error” which may be rectified, even if employee did not bring an appeal regarding the matter (Aurora Land v. NLRC, 1997) LIMITED BACKWAGES General rule: An illegally dismissed employee is entitled to full backwages. Exceptions (1) Where the employee was illegally dismissed but the employer was found to be in good faith. (2) Delay of the EE in filing the case for illegal dismissal

PREVENTIVE SUSPENSION Definition It is a disciplinary measure for the protection of the company's property pending investigation of any alleged malfeasance or misfeasance committed by the employee. The employer may place the worker concerned under preventive suspension if his continued employment poses a serious and imminent threat to the life or property of the employer or of his co-workers. (PAL v. NLRC, 1998) Preventive suspension is limited to 30 days; any more than that amounts to constructive dismissal. (Pido vs. NLRC, 2007)

Computation

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CONSTRUCTIVE DISMISSAL The following constitute constructive dismissal: (1) Bona fide suspension of the operation of a business or undertaking exceeding 6 months (Valdez v. NLRC, 1998) (2) Floating status of more than 6 months (Agro Commercial Security Services v. NLRC, 1989) An involuntary resignation is resorted to 1) when continued employment is rendered impossible, unreasonable, or unlikely; 2) when there is a demotion in rank and/or a diminution in pay; 3) or when a clear discrimination, insensibility or disdain by an employer becomes unbearable to the employee. (Phil. Wireless, Inc. v. NLRC, 1998) If an employee was forced to remain without work or assignment for a period exceeding 6 months, then he is in effect constructively dismissed (Valdez v. NLRC, 1998)

Management Prerogative So long as a company’s management prerogatives are exercised in good faith for the advancement of the employer’s interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements, this Court will uphold them…Even as the law is solicitous of the welfare of the employees, it must also protect the right of an employer to exercise what are clearly management prerogatives. The free will of management to conduct its own business affairs to achieve its purpose cannot be denied. (Ernesto G. Ymbong vs. ABS-CBN Broadcasting Corp., 2012)

DISCIPLINE

The employer’s right to conduct the affairs of his business, according to its own discretion and judgment, includes the prerogative to instill discipline in its employees and to impose penalties, including dismissal, upon erring employees. (Consolidated Food Corporation vs. NRLC, 1999) (St. Michael’s Institute vs. Santos, 2001) Although we recognize the right of employers to shape their own work force, this management

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prerogative must not curtail the basic right of employees to security of tenure. (Alert Security & Investigation Agency, Inc. vs. Saidali Pasawilan, et. al., 2011)

TRANSFER OF EMPLOYEES

It is management prerogative for employers to transfer employees on just and valid grounds such as genuine business necessity. (William Barroga vs. Data Center College of the Philippines, 2011) Limitation (1) Must not be unreasonable, or inconvenient, or prejudicial to the employee, AND (2) Must not involve a demotion in rank or diminution of salaries, benefits, and other privileges. (Bisig ng Manggagawa sa TRYCO v. NLRC, 2008)

PRODUCTIVITY STANDARD The employer has the right to demote and transfer an employee who has failed to observe proper diligence in his work and incurred habitual tardiness and absences and indolence in his assigned work. (Petrophil Corporation vs. NLRC, 1986)

GRANT OF BONUS A grant of a bonus is a prerogative, not an obligation of the employer. The matter of giving a bonus over and above the worker’s lawful salaries and allowances is entirely dependent on the financial capability of the employer to give it. (Kimberly-Clark Philippines, Inc. vs. Dimayuga, 2009)

CHANGE OF WORKING HOURS Further, management retains the prerogative, whenever exigencies of the service so require, to change the working hours of its employees. So long as such prerogative is exercised in good faith for the advancement of the employer’s interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements, this Court will uphold such exercise. (Sime

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Darby Pilipinas Inc. v. NLRC, 1998)

RULES ON MARRIAGE BETWEEN EMPLOYEES OF COMPETITOR-EMPLOYERS Prohibition is reasonable because relationships of that nature might compromise the interests of the employer. The prohibition is to protect its interests against the possibility that a competitor company will gain access to its secrets and procedures.

POST-EMPLOYMENT BAN In cases where an employee assails a contract containing a provision prohibiting him or her from accepting competitive employment as against public policy, the employer has to adduce evidence to prove that the restriction is reasonable and not greater than necessary to protect the employer’s legitimate business interests. The restraint may not be unduly harsh or oppressive in curtailing the employee’s legitimate efforts to earn a livelihood and must be reasonable in light of sound public policy. (Rivera v Solidbank, 2006)

Labor Relations Law RIGHT TO SELF-ORGANIZATION STATUTORY BASIS 1987 Constitution Art. III Sec. 8. The right of the people, including those employed in the public and private sectors, to form unions, associations, or societies for purposes not contrary to law shall not be abridged. Art. XIII Sec. 3. The state shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment opportunities for all. It shall guarantee the rights of all workers to selforganization, collective bargaining and negotiations, and peaceful concerted activities,

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including the right to strike in accordance with law. Labor Code Art. 249. All persons employed in commercial, industrial and agricultural enterprises and in religious, charitable, medical, or educational institutions, whether operating for profit or not, shall have the right to self-organization and to form, join, or assist labor organizations of their own choosing for purposes of collective bargaining. 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. Art. 250. Employees of government corporations established under the corporation code shall have the right to organize and to bargain collectively with their respective employers.

WHO MAY UNIONIZE FOR PURPOSES OF COLLECTIVE BARGAINING General Rule: All employees Art. 283 (c). Any employee, whether employed for a definite period or not, shall, beginning on his first day of service, be considered as an employee for purposes of membership in any labor union. Government Employees In Civil Service and of Government Corporations Under the Corporation Code 1987 Constitution, Art. IX-B, Sec. 2 [5]. The right to self-organization shall not be denied to government employees. EO 180 Section 2. All government employees can form, join, or assist employees’ organizations of their own choosing for the furtherance and protection of their interests. They can also form, in conjunction with appropriate government authorities, labormanagement committees, work councils and other forms of workers’ participation schemes to achieve the same objectives.

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Supervisory Employees Art. 218 (m). Supervisory employees are those who, in the interest of the employer, effectively recommend such managerial actions if the exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment. Art. 251. Supervisory employees shall not be eligible for membership in a labor organization of the rank-and-file employees but may join, assist or form separate labor organizations of their own. Effect of Mixed Membership Art. 251-A. The inclusion as union members of employees outside the bargaining unit shall not be a ground for the cancellation of the registration of the union. Said employees are automatically deemed removed from the list of membership of said union. Same Federation or National Union Art. 251 The rank and file union and the supervisors’ union operating the same establishment may join the same federation or national union. Aliens with Valid Working Permits General rule: All aliens xxx are strictly prohibited from engaging directly or indirectly in all forms of trade union activities. Exception: Aliens working in the country with valid permits issued by the DOLE xxx are nationals of a country which grants the same or similar rights to Filipino workers. (Art. 275) The DFA provides the certification on the requirement of reciprocity. (Book V, Rule II, Sec. 2, Par. 1, 3rd sentence) Security Personnel The security guards and other personnel employed by the security service contractor shall have the right: (1) To form, join, or assist in the formation of a labor organization of their own choosing for purposes of collective bargaining and (2) To engage in concerned activities which are not contrary to law including the right to UP LAW BOC

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strike. (D.O. No. 14 Series of 2001 Guidelines Governing the Employment and Working Conditions of Security Guards and Similar Personnel in the Private Security Industry) WHO CANNOT FORM, JOIN OR ASSIST LABOR ORGANIZATIONS (1) Managerial employees (Art 251) (2) Confidential employees (3) Non-employees (4) Member-employee of a cooperative (5) Employees of international organizations (6) High-level government employees (E.O. 180 Sec.3) (7) Members of the AFP, police officers, policemen, firemen and jail guards

BARGAINING UNIT

Bargaining Unit refers to a group of employees sharing mutual interests within a given employer unit, comprised of all or less than all of the entire body of employees in the employer unit or any specific occupational or geographical grouping within such employer unit. (Book V, Rule 1, Sec. 1[d]) TEST TO DETERMINE THE CONSTITUENCY OF AN APPROPRIATE BARGAINING UNIT 4 Factors (1) Will of the Employees (Globe Doctrine) – a practice which sanctions the holding of a series of elections, not for the purpose of allowing the group receiving an overall majority of votes to represent all employees, but for the specific purpose of permitting the employees in each of the several categories to select the group which each chooses as a bargaining unit. (Kapisanan ng mga Manggagawa sa Manila Road Co. v. Yard Crew Union, 1960) (2) Affinity and unity of employees’ interest (3) Prior collective bargaining history (4) Employment status (UP v. Ferrer-Calleja, 1992) Other factors: (1) Geography and Location (2) Policy of avoiding fragmentation of the bargaining unit

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VOLUNTARY RECOGNITION Voluntary Recognition refers to the process by which a legitimate labor union is recognized by the employer as the exclusive bargaining representative or agent in a bargaining unit, reported with the Regional office in accordance to Rule VII, Sec 2 of these Rules. (Book V, Rule I, Sec. 1 [bbb]) REQUIREMENTS Substantive Requirements (1) Unorganized establishment; (2) Only one union asking for recognition; (3) The members of the bargaining unit did not object to the projected recognition of the union. (Book V, Rule VII, Sec. 2) Procedural Requirements The notice of voluntary recognition shall be accompanied by the original copy and two (2) duplicate copies of the following documents: (1) A joint statement under oath of voluntary recognition attesting to the fact of voluntary recognition (2) Certificate of posting of the joint statement of voluntary recognition for fifteen (15) consecutive days in at least two (2) conspicuous places in the establishment or bargaining unit where the union seeks to operate; (3) The approximate number of employees in the bargaining unit, accompanied by the names of those who support the voluntary recognition comprising at least a majority of the members of the bargaining unit; and (4) A statement that the labor union is the only legitimate labor organization operating within the bargaining unit. All accompanying documents of the notice for voluntary recognition shall be certified under oath by the employer representative and president of the recognized labor union. CERTIFICATION ELECTION Certification election is the process of determining, through secret ballot, the sole and exclusive bargaining agent of the employees in an appropriate bargaining unit, for purposes of collective bargaining. (Book V Rule I Sec. 1 [x])

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WHO MAY FILE A PETITION FOR CERTIFICATION ELECTION (1) Legitimate labor organization (registered with DOLE) (2) Unregistered local chapter with charter certificate from duly registered national union or federation (3) National union or federation in behalf of its local/chapter (4) Employer (when requested to bargain collectively and no existing CBA) EMPLOYER-BYSTANDER RULE The employer shall not be considered a party in the petition with a concomitant right to oppose a petition for certification election. The employer’s participation shall be limited to: (1) Being notified or informed of petitions of such nature (2) Submitting the list of employees during the pre-election conference should the Medarbiter act favorably on the petition (Art 258A introduced by RA 9481) VENUE FOR FILING THE PETITION BLR Regional Office which issued the petitioning union’s certificate of registration or certificate of creation of chartered local. CERTIFICATION ELECTION IN AN UNORGANIZED ESTABLISHMENT PROCEDURE (1) Filing of petition (2) Med- Arbiter shall automatically conduct a certification election. VENUE BLR Regional Office which issued the petitioning union’s certificate of registration or certificate of creation of chartered local. CERTIFICATION ELECTION ORGANIZED ESTABLISHMENT

IN

AN

PROCEDURE (1) A verified petition questioning the majority status shall be filed by a legitimate labor organization (2) It must be filed within the 60-day period before expiration of CBA (freedom period) (3) Supported by written consent of at least 25% of ALL employees in the bargaining unit (substantial support)

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VALIDITY Double majority requirement (voters, valid votes) Art. 262. To have a valid election, at least a majority of all eligible voters in the unit must have cast their votes. The labor union receiving the majority of the valid votes cast shall be certified as the exclusive bargaining agent of all the workers in the unit. FORCED INTERVENOR

The incumbent bargaining agent shall automatically be one of the choices in the certification election as forced intervenor. (Book V Rule VIII Sec. 7) Bars to certification election (1) One year bar rule (2) Negotiation bar rule (3) Deadlock bar rule (4) Contract bar rule One year bar rule No certification election may be held within 1 year from the fact that voluntary recognition has been entered, or a valid certification, consent or run-off election has been conducted within the bargaining unit. If appealed, the reckoning period is the date when the decision becomes final and executory. (Book V, Rule VIII, Sec 3 [a]) Negotiation bar rule A petition for certification election may be filed anytime EXCEPT: (1) When the duly certified union has commenced and sustained negotiations in good faith with the employer (2) In accordance with Art. 250 of the Labor Code (3) Within one year after the certification election. (Book V, Rule VIII, Sec 3 [b]) Deadlock bar rule A petition for certification election may be filed anytime, EXCEPT: xxx when a bargaining deadlock to which an incumbent or certified bargaining agent is a party had been submitted to conciliation or arbitration or had become the subject of a valid

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notice of strike or lockout (Book V, Rule VIII, Sec. 3 [c]) CONTRACT BAR RULE Art. 238. The Bureau 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 except under Articles 253, 253-A and 256 of this code. The contract bar rule shall not apply: (1) When the petition is filed during the freedom period in Articles 253, 253-A, and 256. (2) When the CBA is incomplete (3) When the CBA is substandard 6 9 When the CBA is prematurely renewed (4) (5) When the CBA is unregistered FREEDOM PERIOD The last 60 days in a Collective Bargaining Agreement (CBA) is referred to as the “freedom period” when rival union representation can be entertained during the existence of a CBA. (Tanduay Distillery Labor Union v. NLRC, 1987) CERTIFICATION REQUIREMENTS

ELECTION;

OTHER

POSTING OF NOTICE The election Officer shall cause the posting of the notice of election in 2 conspicuous places in company premises at least 10 days before actual election. Contents of Notice (1) Date and Time of election; (2) Names of all contending unions; (3) Description of the bargaining unit (4) List of eligible and challenged Voters. The posting of the notice of election, the information required to be included therein and the duration of the posting cannot be waived by the contending unions or the employer. (Book V Rule IX Sec 6, IRR) Voting List and Voters The basis of determining voters may be agreed upon by the parties (i.e. the use

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of payroll). (Acoje Workers Union v NAMAWU, 1963) VOTING DAY The election shall be set on a regular business day. (IRR, Book V Rule IX Sec. 2) RUN-OFF ELECTION Run-Off refers to an election between the labor unions receiving the two (2) higher number of voters in a certification election where— (1) Majority of the bargaining unit voted (first majority of the double majority rule) (2) There are three or more choices (note: “no union” is a choice) (3) Not one of the choices receives a majority of the valid votes cast AND (4) Total number of votes for all contending unions is at least 50% of the total number of votes cast (this means that at least 50% of the bargaining unit wants to have a union) RE-RUN ELECTION A motion for the immediate holding of another certification or consent election can be filed within six (6) months from the date of the declaration of failure of election. (Book V, Rule IX Sec 18) CONSENT ELECTION Consent Election means the election voluntarily agreed upon by the parties to determine the issue of majority representation of all the workers in the appropriate collective bargaining unit. The contending unions may agree to the holding of an election. In which case, it shall be called a consent election. The Med-Arbiter shall forthwith call for the consent election reflecting the parties’ agreement and the call in the minutes of the conference. (Book V RVIII Sec 10) AFFILIATION AND DISAFFILIATION OF A LOCAL UNION AFFILIATE An affiliate is an independent union affiliated with a federated, national union or a chartered local which was subsequently granted

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independent registration but did not disaffiliate from its federation, reported to the Regional Office and the Bureau in accordance with Rule III Secs. 6 and 7 of the IRR. (Book V Rule 1 Sec. 1 [a]) INDEPENDENT UNION A labor organization operating at the enterprise level that required legal personality through independent registration under Art. 234 of the Labor Code and Rule III Sec. 2-A of the IRR. (Book V Rule 1 Sec. 1 [w]) CHARTERED LOCAL (LOCAL CHAPTER) A labor organization in the private sector operating at the enterprise level that acquired legal personality through the issuance of a charter certificate by a duly registered federation or national union, and reported to the Regional Office in accordance with Rule III Sec. 2-E of the IRR. (Book V Rule 1 Sec. 1 [i]) NATIONAL UNION OR FEDERATION A group of legitimate labor unions in a private establishment organized for collective bargaining or for dealing with employers concerning terms and conditions of employment for their member union or for participating in the formulation of social and employment policies, standards and programs, registered with the BLR in accordance with Rule III Sec. 2-B of the IRR. (Book V Rule 1 Sec. 1 [kk]) DISAFFILIATION Disaffiliation Must be by a Majority Decision Art. 247 (d). The members shall determine by secret ballot, after due deliberation, any question of major policy affecting the entire membership of the organization, unless the nature of the organization or force majeure renders such secret ballot impractical, in which case, the board of directors of the organization may make the decision. Effect of disaffiliation A registered independent union retains its legal personality while a chartered local loses its legal personality unless it registers itself.

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SUBSTITUTIONARY DOCTRINE

The employees cannot revoke the validly executed collective bargaining contract with their employer by the simple expedient of changing their bargaining agent. The employees, thru their new bargaining agent, cannot renege on their collective bargaining contract, except of course to negotiate with management for the shortening thereof. (Benguet Consolidated v. BCI Employees and Workers Union-PAFLU, 1998)

UNION DUES AND SPECIAL ASSESSMENTS Art. 247 (h). Every payment of fees, dues or other contributions by a member shall be evidenced by a receipt signed by the officer or agent making the collection and entered into the record of the organization to be kept and maintained for the purpose. Art. 247 (n). No special assessment or other extraordinary fees may be levied upon the members of a labor organization unless authorized by a written resolution of a majority of all the members of a general membership meeting duly called for the purpose. Art. 247 (o). Other than for mandatory activities under the Code, no special assessments, attorney’s fees, negotiation fees or any other extraordinary fees may be checked off from any amount due to an employee without an individual written authorization duly signed by the employee. The authorization should specifically state the amount, purpose and beneficiary of the deduction. ATTORNEY’S FEES, NEGOTIATION FEES, AND SIMILAR CHARGES Art. 228 (b). No attorney’s fees, negotiation fees or similar charges of any kind arising from any collective bargaining negotiations or conclusion of the collective agreement shall be imposed on individual member of contracting union. Provided, however, that attorney’s fees may be charged against union funds in an amount to be agreed upon by the parties. Any contract, agreement or arrangement of any sort to the contrary shall be null and void. JURISDICTION OVER CHECK-OFF DISPUTES

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The Bureau of Labor Relations has jurisdiction to hear, decide and to mete out punishment any reported violation under Article 241 Note: Sec of Labor or his duly authorized representative may inquire into financial activities of legitimate labor orgs – UPON filing of complaint under oath and supported by written consent of at least 20% of total membership, Provided, such inquiry shall not be conducted during (60)-day freedom period nor within the thirty (30) days immediately preceding the date of election of union officials (Art. 274). AGENCY FEES Art. 254 (e). Employees of an appropriate bargaining unit who are not members of the recognized collective bargaining agent may be assessed a reasonable fee equivalent to the dues and other fees paid by members of the recognized collective bargaining agent, if such non-union members accept the benefits under the collective bargaining agreement: Provided, that the individual authorization required under Article 242, paragraph (o) of this Code shall not apply to the non-members of the recognized collective bargaining agent.

RIGHT TO BARGAINING

COLLECTIVE

DUTY TO BARGAIN COLLECTIVELY Art. 258. The performance of a mutual obligation to meet and convene promptly and expeditiously in good faith for the purpose of negotiating an agreement with respect to wages, hours of work and all other terms and conditions of employment including proposals for adjusting any grievances or questions arising under such agreement and executing a contract incorporating such agreement if required by either party but such duty does not compel any party to agree to a proposal or to make any concession. WHEN EMPLOYERS MAY BE COMPELLED TO BARGAIN COLLECTIVELY (1) Majority representation by the representative labor organization (exclusive bargaining agent)

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(2) Demand by the labor organization [Art. 250 par(a)]

ascertain the will of the employees in the appropriate bargaining unit.

RIGHTS OF THE PARTIES DURING BARGAINING Art. 248 (c). To be furnished by the employer, upon written request, with its annual audited financial statements, including the balance sheet and the profit and loss statement, within thirty (30) calendar days from the date of receipt of the request, after the union has been duly recognized by the employer or certified as the sole and exclusive bargaining representative of the employees in the bargaining unit, or within sixty (60) calendar days before the expiration of the existing collective bargaining agreement, or during the collective bargaining negotiation. Book V Rule XVI Sec 2. The parties may agree to make available such up-to-date financial information which is normally submitted to relevant government agencies material and necessary for meaningful negotiations. They may also agree to the condition that the information be kept confidential.

xxx At the expiration of the freedom period, the employer shall continue to recognize the majority status of the incumbent bargaining agent where no petition for certification election is filed. (Art. 256)

WHEN THERE IS ABSENCE OF A CBA Art. 257. In the absence of an agreement or other voluntary arrangement providing for a more expeditious manner of collective bargaining, it shall be the duty of employer and the representatives of the employees to bargain collectively in accordance with the provisions of this Code. WHEN THERE IS A CBA The duty to bargain collectively shall also mean that neither party shall terminate nor modify such agreement during its lifetime. Exception: In organized establishments, when a verified petition questioning the majority status of the incumbent bargaining agent is filed before the Department of Labor and Employment within the sixty-day period before the expiration of the collective bargaining agreement, the Med-Arbiter shall automatically order an election by secret ballot when the verified petition is supported by the written consent of at least twenty-five percent (25%) of all the employees in the bargaining unit to

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COLLECTIVE AGREEMENT (CBA)

BARGAINING

A collective bargaining agreement 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, including mandatory provisions for grievances and arbitration machineries. (Book V Rule I Section 1[j]) CBA IMPRESSED WITH PUBLIC POLICY The relations between capital and labor are not merely contractual. They are so impressed with public interest that labor contracts must yield to the common good. Therefore, such contracts are subject to the special laws on labor unions, collective bargaining, strikes and lockouts, closed shop, wages, working conditions, hours of labor and similar subjects. (Art. 1700, Civil Code) EFFECT OF UNREGISTERED CBA An unregistered CBA is binding upon the parties but cannot serve as a bar to a petition for certification election under the contract-bar rule. BENEFICIARIES OF THE CBA The CBA benefits all workers in a collective bargaining unit. When a collective bargaining contract is entered into by the union representing the employees and the employer, even the non-member employees are entitled to the benefits of the contract. (New Pacific Timber and Supply v. NLRC, 2000) BARGAINING PROCEDURE: (Book V, Rule XVI) (1) Private Procedure The parties may provide for their own procedures in collective bargaining. The law only requires that these procedures be more 64 of 92

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expeditious than the procedure in Art. 250. (Art 251) (2) Labor Code Procedure (Art. 250) (a) Written notice and statement of proposals. (b) Reply of the other party within 10 days from receipt of notice (c) Conference should differences arise, to be held not later than 10 calendar days from request (d) Board intervention and conciliation (e) Voluntary arbitration During the conciliation proceedings in the Board, the parties are prohibited from doing any act which may disrupt or impede the early settlement of the disputes. CONCILIATION / PREVENTIVE MEDIATION – Privileged communication Art. 233. Information and statements made at conciliation proceedings shall be treated as privileged communication and shall not be used as evidence in the Commission. Conciliators and similar officials shall not testify in any court or body regarding any matters taken up at conciliation proceedings conducted by them. MANDATORY BARGAINABLE ISSUES (1) Wages (2) Hours of work (3) All other terms and conditions of employment including proposals for adjusting any grievances or questions arising under such agreement (Art. 252) PERMISSIVE ISSUES: Unilateral benefits extended by the employer (cf., Union of Filipro Employees-Drug v. Nestle, 2008) MANDATORY PROVISIONS OF CBA GRIEVANCE PROCEDURE The parties to a Collective Bargaining Agreement shall include therein: (1) Provisions that will ensure the mutual observance of its terms and conditions. (2) A machinery for the adjustment and resolution of grievances arising from:

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(a) the interpretation or implementation of their CBA; and (b) those arising from the interpretation or enforcement of company personnel policies. (3) All grievances submitted to the grievance machinery which are not settled within 7 calendar days from the date of its submission shall be automatically referred to voluntary arbitration prescribed in the CBA. (Art. 260) VOLUNTARY ARBITRATION Constitutional basis 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. (Art. XIII Section 3) Automatic referral if grievance machinery fails Art. 266. All grievances submitted to the grievance machinery which are not settled within 7 calendar days from the date of its submission shall automatically be referred to voluntary arbitration prescribed in the CBA. VOLUNTARY ARBITRATION PROVISION IN THE CBA (1) Parties to a CBA shall: (a) Name and designate in advance a Voluntary Arbitrator or panel of Voluntary Arbitrators, OR (b) Include in the agreement a procedure for the selection of such Voluntary Arbitrator or panel of Voluntary Arbitrators preferably from the listing of qualified Voluntary Arbitrators duly accredited by the Board. (2) In case the parties fail to select a Voluntary Arbitrator or panel of Voluntary Arbitrators, the Board shall designate the Voluntary Arbitrator or panel of Voluntary Arbitrators, as may be necessary, pursuant to the selection Voluntary Arbitrator or panel of Arbitrators procedure agreed upon in the CBA, which shall act with the same force and effect as if the has been selected by the parties as described above. (Art. 260)

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ARBITRABLE ISSUES (1) interpretation or implementation of the CBA (Art. 261) (2) interpretation or enforcement of company personnel policies (Art. 261) (3) gross violations of CBA provision (flagrant/malicious refusal to comply with the economic provisions of the CBA (Art. 261) (4) all other labor disputes including ULP and bargaining deadlock, if the parties agree (Art. 262) POWERS OF THE VOLUNTARY ARBITRATORS (1) hold hearings (2) receive evidence (3) take whatever action is necessary to resolve the issue or issues subject of dispute, including efforts to effect a voluntary settlement between parties (4) determine attendance of any third parties (5) determine exclusion of any witness (6) issue writ of execution for sheriff of NLRC or regular courts to execute the final decision, order, or award (Art 262-A) FINALITY OF THE FINAL DECISION, ORDER, OR AWARD Art 268-A. Award or decision of the voluntary arbitrator shall be final and executory after 10 days from receipt of the copy of the award or decision by the parties. NO MOTION FOR RECONSIDERATION The voluntary arbitrator lost jurisdiction over the case submitted to him the moment he rendered his decision. Therefore, he could no longer entertain a motion for reconsideration of the decision for its reversal or modification. (Solidbank v. BLR) APPEAL While there is an express mode of appeal from the decision of a labor arbiter, Republic Act No. 6715 is silent with respect to an appeal from the decision of a voluntary arbitrator. Assuming arguendo that the voluntary arbitrator or the panel of voluntary arbitrators may not strictly be considered as a quasijudicial agency, board or commission, still both he and the panel are comprehended within the concept of a "quasi-judicial instrumentality." A

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fortiori, the decision or award of the voluntary arbitrator or panel of arbitrators should likewise be appealable to the Court of Appeals. (Luzon Development Bank v. Assoc of Luzon Dev’t Employees, 1995) COSTS The parties to a Collective Bargaining Agreement shall provide therein a proportionate sharing scheme on the cost of the voluntary arbitration including the Voluntary Arbitrators fee. (Art. 262-B) NO STRIKE-NO LOCKOUT CLAUSE A "no strike, no lock-out" provision in the CBA is a valid stipulation although the clause may be invoked by an employer only when the strike is economic in nature or one which is conducted to force wage or other concessions from the employer that are not mandated to be granted by the law itself. It would be inapplicable to prevent a strike which is grounded on unfair labor practice. (Panay Electric Co. v. NLRC, 1995; Malayang Samahan ng mga Manggagawa sa Greenfield v. Ramos, 2000) LABOR MANAGEMENT COUNCIL Art. 255. Any provision of law to the contrary notwithstanding, workers shall have the right, subject to such rules and regulations as the Secretary of Labor and Employment may promulgate, to 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 labor-management 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. DURATION Art. 259-A. Any Collective Bargaining Agreement that the parties may enter into shall, insofar as the representation aspect is concerned, be for a term of five (5) years. No petition questioning the majority status of the incumbent bargaining agent shall be entertained and no certification election shall be conducted by the Department of Labor and

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Employment outside of the sixty-day period immediately before the date of expiry of such five-year term of the Collective Bargaining Agreement. All other provisions of the Collective Bargaining Agreement shall be renegotiated not later than three (3) years after its execution. Any agreement on such other provisions of the Collective Bargaining Agreement entered into within six (6) months from the date of expiry of the term of such other provisions as fixed in such Collective Bargaining Agreement, shall retroact to the day immediately following such date. If any such agreement is entered into beyond six months, the parties shall agree on the duration of retroactivity thereof. In case of a deadlock in the renegotiation of the Collective Bargaining Agreement, the parties may exercise their rights under this Code.

(Manila Electric Company vs. Quisumbing, 1999)

CBA EFFECTIVITY If it is the first ever CBA, the effectivity date is whatever date the parties agree on.

UNION SECURITY

If it is renegotiated CBA, the effectivity date depends upon the duration of conclusion. (1) If it is concluded within 6 months from the expiry date, the new CBA will retroact to the date following the expiry date (Illustration: expiry date: December 13; effectivity date: December 14). (2) If the renegotiated CBA is concluded beyond 6 months from the expiry date, the matter of retroaction and effectivity is left with the parties. HOLD OVER PRINCIPLE Art. 259. In the absence of a new CBA, the parties must maintain the status quo and must continue in full force and effect the terms and conditions of the existing agreement during the sixty (60) day period and/or until a new agreement is reached. ARBITRATED CBA In the absence of an agreement between the parties, an arbitrated CBA takes on the nature of any judicial or quasi-judicial award. It operates and may be executed only prospectively unless there are legal justifications for its retroactive application.

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CBA AND 3RD PARTY APPLICABILITY General Rule: An innocent transferee of a business establishment has no liability to the employees of the transferor to continue employing them. Nor is the transferee liable for past unfair labor practices of the previous owner. Exception: (1) When the liability therefore is assumed by the new employer under the contract of sale, or (2) When liability arises because of the new owner's participation in thwarting or defeating the rights of the employees.

Art. 254 (e) Nothing in this Code or in any other law shall stop the parties from requiring membership in a recognized collective bargaining agent as a condition for employment, except those employees who are already members of another union at the time of the signing of the collective bargaining agreement. LIMITATION Art. 254 (e) Employees who are already members of another union at the time of the signing of the collective bargaining agreement may not be compelled by any union security clause to join any union. UNION SECURITY CLAUSES; CLOSED SHOP, UNION SHOP, MAINTENANCE OF MEMBERSHIP SHOP, ETC. CLOSED SHOP Only union members can be hired by the company and they must remain as members to retain employment in the company. (Azucena) Maintenance of membership shop No employee is compelled to join the union, but all present or future must, as a condition of employment, remain in good standing in the union. (Azucena)

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UNION SHOP Non-members may be hired, but to retain employment, they must become union members after a certain period. The requirement applies to present and future employees. (Azucena) MODIFIED UNION SHOP Employees who are not union members at the time of signing the contract need not join the union, but all hired workers thereafter must join. (Azucena) AGENCY SHOP An agreement whereby employees must either join the union or pay to the union as exclusive bargaining agent a sum equal to that paid by the members. (Azucena) UNFAIR LABOR PRACTICE IN COLLECTIVE BARGAINING Both employers and labor organizations can commit acts of unfair labor practices in collective bargaining. However, the labor organization must be the representative of the employees before any act it does may be considered as a violation of the duty to bargain collectively. (Art. 248 (g) and Art. 249 (c)] (1) Bargaining in bad faith (2) Refusal to bargain (3) Individual bargaining (4) Blue sky bargaining (5) Surface bargaining UNFAIR LABOR PRACTICE (ULP) Unfair labor practice refers to acts that violate the workers’ right to organize. The prohibited acts are related to the workers’ right to selforganization and to the observance of a CBA. Without that element, the acts, no matter how unfair, are not unfair labor practices. The only exception is Art. 248 (f) [i.e. to dismiss, discharge or otherwise prejudice or discriminate against an employee for having given or being about to give testimony under this Code]. (Philcom Employees Union v. Phil. Global, 2006) ULP of employers (1) Interference/ Restraint/ Coercion (2) Yellow dog contracts (3) Contracting out

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General rule: contracting out is not ULP Exception: (a) contracted-out services or functions are performed by union members AND (b) contracting out will interfere with, restrain, or coerce employees in the exercise of their right to self-organization. [Art. 248 (c)] Company unionMeans any labor organization whose formation, function or administration has been assisted by any act defined as unfair labor practice by this Code. (Art. 212[i]) (4) Discrimination – Encourage/Discourage Unionism General rule: it is ULP 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. Exception (union security clause): Nothing in this Code or in any other law shall stop the parties from requiring membership in a recognized collective bargaining agent as a condition for employment. Exception to exception: Those employees who are already members of another union at the time of the signing of the collective bargaining agreement. (Art. 254 [e]) (5) Testimony Art. 254 (f) It is an act of ULP by an employer to dismiss, discharge or otherwise prejudice or discriminate against an employee for having given or being about to give testimony under this Code. (6) Violate duty to bargain collectively (7) Payment of negotiation or attorney's fees Sweetheart contracts Sweetheart contracts are favorable both to the union and the employer at the expense of the employees. The settlement of bargaining issues must be made by fair bargaining in good faith, and not through the payment of negotiation or attorney's fees which will ultimately lead to sweetheart contracts. (8) To violate a collective bargaining agreement Flagrant and/or malicious refusal required Violations of collective bargaining agreements, except flagrant and/or malicious refusal to comply with its economic provisions, shall not be considered

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unfair labor practice and shall not be strikeable. (IRR) Note: The list in Art. 254 LC is not exhaustive. Other acts which are analogous to those enumerated can be ULP. ULP of labor organizations (1) Restraint, or coercion “Interfere” is not included in Art. 249 simply because any act of a labor organization amounts to interference to the right of selforganization. (2) Discrimination Encourage/Discourage Unionism General rule: it is ULP for a labor organization to cause an employer to discriminate against an employee Exception: provisions of a valid union security clause and other company policies applicable to all employees. (3) Violate duty to bargain or the CBA (4) Exaction (Featherbedding) Featherbedding or “make-work” by the union is the practice of the union asking (exacting) for money or other things of value from the employer in return for services which are not performed or are not to be performed. (5) Asking or accepting negotiation and other attorney's fees (6) Violate a collective bargaining agreement Flagrant and/or malicious refusal required

RIGHT TO PEACEFUL CONCERTED ACTIVITIES CONSTITUTIONAL BASIS The state shall guarantee the rights of all workers to xxx peaceful concerted activities, including the right to strike in accordance with law. (Art. XIII Section 3) Right to self-organization includes the right to engage in lawful concerted activities and may not be abridged Art. 252. It shall be unlawful for any person to restrain, coerce, discriminate against or unduly interfere with employees and workers in their exercise of the right to self-organization. Such right shall include the right to form, join, or assist labor organizations for the purpose of

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collective bargaining through representatives of their own choosing and to engage in lawful concerted activities for the same purpose or for their mutual aid and protection, subject to the provisions of Article 264 of this Code.

FORMS OF CONCERTED ACTIVITIES (a) Strike (b) Picketing

Employer's economic weapon: Lockout

STRIKE Art. 218 (o). A strike is any temporary stoppage of work by the concerted action of employees as a result of an industrial or labor dispute. PAYMENT OF WAGES DURING LAWFUL STRIKES General rule: Striking employees are not entitled to the payment of wages for un-worked days during the period of the strike pursuant to the “no work-no pay” principle. Exception: Agreement to the contrary. REINSTATEMENT AFTER A LAWFUL STRIKE When strikers abandon the strike and apply for reinstatement despite the existence of valid grounds but the employer either: (a) refuses to reinstate them or (b) imposes upon their reinstatement new conditions then the employer commits an act of ULP. Art. 269 (b). Workers shall have the right to engage in concerted activities for purposes of collective bargaining or for their mutual benefit and protection. The right of legitimate labor organizations to strike and picket and of employers to lockout, consistent with the national interest, shall continue to be recognized and respected. However, no labor union may strike and no employer may declare a lockout on grounds involving inter-union and intra-union disputes. The strikers who refuse to accept the new conditions and are consequently refused reinstatement are entitled to the losses of pay they may have suffered by reason of the

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employer’s discriminatory acts from the time they were refused reinstatement. FORMS OF STRIKES As to legality Legal strike – one called for a valid purpose and conducted through means allowed by law. Illegal strike – one staged for a purpose not recognized by law, or if for a valid purpose, conducted through means not sanctioned by law. As to grounds Economic strike – one staged by workers to force wage or other economic concessions from the employer which he is not required by law to grant (Consolidated Labor Association of the Phil. v. Marsman and Company 1964) ULP strike – called against a company's unfair labor practice to force the employer to desist from committing such practices. As to how committed Slowdown strike – one by which workers, without a complete stoppage of work, retard production or their performance of duties and functions to compel management to grant their demands. Wild-cat strike – one declared and staged without filing the required notice of strike and without the majority approval of the recognized bargaining agent. Sit-down strike – one wherein workers take over possession of the property of such business to cease production and to refuse access to owners. Sympathetic strike– one in which the striking workers have no demands of their own, but strike to make common cause with other strikers in other establishments. Strike cannot be converted to a lockout by a return to work offer A strike cannot be converted into a pure and simple lockout by the mere expedient filing before the trial court a notice of offer to return to work during the pendency of the labor dispute between the union and the employer. (Rizal Cement Workers Union v. CIR, 1962)

PICKETING

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Art 269 (b). The right of legitimate labor organizations to strike and picket and of employers to lockout, consistent with the national interest, shall continue to be recognized and respected. Picketing is the right of workers to peacefully march to and fro before an establishment involved in a labor dispute generally accompanied by the carrying and display of signs, placards and banners intended to inform the public about the dispute. (NCMB Manual, Sec. 1)

WHO MAY DECLARE A STRIKE OR LOCKOUT? Who may declare a strike (Book V, Rule XXII, Sec. 6) (1) certified or duly recognized bargaining representative (2) any legitimate labor organization in the absence of #1, but only on grounds of ULP Who may declare a lockout (Book V, Rule XXII, Sec. 6) - employer

REQUISITES FOR A VALID STRIKE SUBSTANTIAL REQUIREMENTS/GROUNDS (Art. 263 [c]) A strike or lockout may be declared in cases of: (1) Bargaining deadlocks (2) ULP When no lawful strike can be declared (1) Ground is an inter-union or intra-union dispute (2) No notice of strike (3) No lock-out vote obtained and reported to the NCMB (4) After assumption or certification by the Secretary of Labor PROCEDURAL REQUIREMENTS (1) Effort to bargain Art. 270 (a). No labor organization or employer shall declare a strike or lockout without first having bargained collectively in accordance with Title VII of this Book. (2) Filing and service of notice of strike Bargaining deadlocks

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Art. 269(c). The duly certified or recognized bargaining agent may file a notice of strike or the employer may file a notice of lockout with the Department at least 30 days before the intended date thereof. Unfair labor practice; union busting Art. 269 (c). In cases of unfair labor practice, the period to file notice of strike shall be 15 days. However, in cases of union busting (dismissal of duly elected union officers from employment), the cooling period shall not apply.

CONTENTS OF NOTICE OF STRIKE

(Book V Rule XXII Sec. 8) (1) Names and addresses of the employer and the union involved (2) Nature of the industry to which the employer belongs (3) Number of union members and of workers in the bargaining unit (4) Such other relevant data as may facilitate the settlement of the dispute.

ADDITIONAL REQUIREMENTS

In cases of bargaining deadlocks: (1) Statement of Unresolved issues in the bargaining negotiations (2) Written Proposals of the union (3) Counterproposals of the employer (4) Proof of a request for conference to settle the differences. In cases of ULP: (1) Statement of Acts complained of (2) Efforts taken to resolve the dispute amicably. Action on notice (Book V Rule XXII Sec. 9) Upon receipt of a valid notice of strike or lockout, the NCMB, through its ConciliatorMediators, shall call the parties to a conference the soonest possible time in order to actively assist them to explore all possibilities for amicable settlement. The Conciliator-Mediator may suggest/offer proposals as an alternative avenue for the resolution of their disagreement/conflict which may not necessarily bind the parties.

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If conciliation/mediation fails, the parties shall be encouraged to submit their dispute for voluntary arbitration. (3) Observance of cooling-off periods Cooling off periods (a) bargaining deadlock – 30 days (b) ULP but not union busting – 15 days (c) ULP and union busting – no cooling-off period Art. 269 (e). During the cooling-off period, it shall be the duty of the Ministry to exert all efforts at mediation and conciliation to effect a voluntary settlement. Should the dispute remain unsettled until the lapse of the requisite number of days from the mandatory filing of the notice, the labor union may strike or the employer may declare a lockout. (4) Strike vote (Art. 263 (f)) Requirements for a declaration of a strike in a strike vote (a) approval by a majority of the total union membership in the ABU (b) approval is obtained by secret ballot in a meeting/referendum called for the purpose (5) Strike Vote Report (Art. 263(f)) In every case, the union or the employer shall furnish the Department the results of the voting at least 7 days before the intended strike or lockout, subject to the cooling-off period herein provided. (6) Observance of the waiting period The waiting period, on the other hand, is intended to provide opportunity for the members of the union or the management to take the appropriate remedy in case the strike or lockout vote report is false or inaccurate. (National Federation of Sugar Workers v. Ovejera, 1982)

REQUISITES FOR A VALID LOCKOUT

Lockout by the employer Art. 218 (p). Lockout is the temporary refusal of an employer to furnish work as a result of an industrial or labor dispute.

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No lockout based on intra or inter union disputes Art. 269 (b). No labor union may strike and no employer may declare a lockout on grounds involving inter-union and intra-union disputes. GROUNDS Similar to a strike, the proper grounds for a lockout are (1) bargaining deadlock (2) ULP by labor organizations REQUISITES (1) Effort to bargain Art. 270 (a). No labor organization or employer shall declare a strike or lockout without first having bargained collectively in accordance with Title VII of this Book. (2) Filing and service of notice of lockout Bargaining deadlock Art. 269 (c). The notice of lockout may be filed by the employer at least 30 days before the intended date thereof. ULP Art. 269 (c). In cases of unfair labor practice, the period of notice shall be 15 days. CONTENTS OF NOTICE (1) Names and addresses of the employer and the union involved (2) Nature of the industry to which the employer belongs (3) Number of union members and of workers in the bargaining unit (4) Such other relevant data as may facilitate the settlement of the dispute. ADDITIONAL REQUIREMENTS In cases of bargaining deadlocks (1) Statement of unresolved issues in the bargaining negotiations (2) Written proposals of the union (3) Counterproposals of the employer (4) Proof of a request for conference to settle the differences.

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In cases of ULP (1) Statement of acts complained of (2) Efforts taken to resolve the dispute amicably. ACTION ON NOTICE Upon receipt of a valid notice of strike or lockout, the NCMB, through its ConciliatorMediators, shall call the parties to a conference the soonest possible time in order to actively assist them to explore all possibilities for amicable settlement. The Conciliator-Mediator may suggest/offer proposals as an alternative avenue for the resolution of their disagreement/conflict which may not necessarily bind the parties. If conciliation/mediation fails, the parties shall be encouraged to submit their dispute for voluntary arbitration. (Book V Rule XXII Sec. 9) (3) Observance of cooling-off periods Lockout cooling-off periods:  based on bargaining deadlock – 30 days  based on ULP – 15 days (4) Lockout vote Art. 269 (f). A decision to declare a lockout must be approved by a majority of the board of directors of the corporation or association or of the partners in a partnership, obtained by secret ballot in a meeting called for that purpose. The decision shall be valid for the duration of the dispute based on substantially the same grounds considered when the strike or lockout vote was taken. (5) Report of lockout vote Art. 269 (f). In every case, the union or the employer shall furnish the Ministry the results of the voting at least seven days before the intended strike or lockout, subject to the cooling-off period herein provided. (6) Observance of waiting period (7 days) Effect of Illegal Lockout

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Art. 270 (a), par. 3, 1st sentence. Any worker whose employment has been terminated as a consequence of any unlawful lockout shall be entitled to reinstatement with full backwages.

REQUISITES PICKETING

FOR

LAWFUL

Prohibited activities in picketing (Art. 264) (1) By any person. No person shall obstruct, impede, or interfere with, by force, violence, coercion, threats or intimidation, any peaceful picketing by employees during any labor controversy or in the exercise of the right to self-organization or collective bargaining, or shall aid or abet such obstruction or interference. [Art. 264 (b)] (2) By police force. The police force shall keep out of the picket lines unless actual violence or other criminal acts occur therein: Provided, That nothing herein shall be interpreted to prevent any public officer from taking any measure necessary to maintain peace and order, protect life and property, and/or enforce the law and legal order. [Art. 264 (d)] (3) By person engaged in picketing. No person engaged in picketing shall commit any act of violence, coercion or intimidation or obstruct the free ingress to or egress from the employer’s premises for lawful purposes, or obstruct public thoroughfares. [Art. 264 (e)] Picketing as part of freedom of speech/expression; limitations General rule: picketing enjoys constitutional protection as part of freedom of speech and/or expression. Exceptions/limitations: (1) when picketing is coercive rather than persuasive (Security Bank Employees Union v. Security Bank) (2) when picketing is achieved through illegal means (Mortera v. CIR) (3) courts may confine the communication/demonstration to the parties to the labor dispute (PCIB v. Philnabank Employees Association) (4) Innocent bystander rule. An "innocent

bystander," who seeks to enjoin a labor strike, must satisfy the court that aside

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from the grounds specified in Rule 58 of the Rules of Court, it is entirely different from, without any connection whatsoever to, either party to the dispute and, its interests are totally foreign to the context thereof. (MSF Tire and Rubber Inc. v. CA, 1999)

Peaceful picketing is legal even in the absence of employer-employee relationship Picketing, peacefully carried out, is not illegal even in the absence of employer-employee relationship, for peaceful picketing is a part of the freedom of speech guaranteed by the Constitution. (De Leon v. National Labor Union, 1957)

ASSUMPTION OF JURISDICTION BY THE DOLE SECRETARY OR CERTIFICATION OF THE LABOR DISPUTE TO THE NLRC FOR COMPULSORY ARBITRATION

Conditions for the assumption/certification powers (1) labor dispute in an industry indispensable to the national interest (2) such dispute is causing or is likely to cause a strike or lockout Powers of the Secretary of Labor (alternative) (1) Assumption of jurisdiction. The Secretary of Labor will decide the labor dispute himself/herself. (2) Certification for compulsory arbitration. The Secretary of Labor will certify the labor dispute to the NLRC for compulsory arbitration. Powers of the President (not precluded by the powers of the Secretary of Labor) (1) determine the industries indispensable to the national interest (2) assume jurisdiction over any such labor dispute to settle or terminate such dispute WHO DETERMINES INDUSTRIES INDISPENSABLE TO THE NATIONAL INTEREST Art. 263 (g), last paragraph. It is in the discretion of the Secretary of Labor to determine which

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industries are indispensable to the national interest. However, the President may determine such industries himself: The foregoing notwithstanding, the President of the Philippines shall not be precluded from determining the industries that, in his opinion, are indispensable to the national interest, and from intervening at any time and assuming jurisdiction over any such labor dispute in order to settle or terminate the same.

NATURE OF ASSUMPTION ORDER OR CERTIFICATION ORDER (1) Automatic injunction (2) Return-to-work and admission (3) Immediately executory

(1) Automatic injunction of intended of impending strike or lockout Art. 269 (g), 2nd sentence. Such assumption or certification shall have the effect of automatically enjoining the intended or impending strike or lockout as specified in the assumption or certification order. (2) Return-to-work and readmission if strike or lockout has already taken place Art. 269 (g), 3rd sentence. If one has already taken place at the time of assumption or certification, all striking or locked out employees shall immediately return-to-work and the employer shall immediately resume operations and readmit all workers under the same terms and conditions prevailing before the strike or lockout. (3) Immediately executory The assumption and certification orders are executory in character and must be strictly complied with by the parties. (Allied Banking v. NLRC, 1996) Strikes and lockouts in hospitals, clinics and similar medical institutions Art. 269 (g). It shall be the duty of the striking union or locking-out employer to provide and maintain an effective skeletal workforce of medical and other health personnel, whose movement and services shall be unhampered and unrestricted, as

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are necessary to insure the proper and adequate protection of the life and health of its patients, most especially emergency cases, for the duration of the strike or lockout. In such cases, therefore, the Secretary of Labor and Employment may immediately assume, within twenty four (24) hours from knowledge of the occurrence of such a strike or lockout, jurisdiction over the same or certify it to the Commission for compulsory arbitration.

EFFECT OF DEFIANCE OF ASSUMPTION OR CERTIFICATION ORDERS Art. 270 (a). No strike or lockout shall be declared after assumption of jurisdiction by the President or the Minister or after certification or submission of the dispute to compulsory or voluntary arbitration or during the pendency of cases involving the same grounds for the strike or lockout.

SUMMARY OF LIABILITIES OF PARTICIPANTS IN AN ILLEGAL STRIKE/LOCKOUT (ART. 264) Employer in an illegal lockout – workers terminated due to illegal lockout shall be entitled to reinstatement plus full backwages. Union officers who participated in illegal strike – deemed to have lost their employment Union officers who participated in illegal acts during a lawful strike – deemed to have lost their employment. Ordinary workers – deemed to have lost their employment only if they participated in illegal acts.

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STRICTER PENALTIES FOR NONCOMPLIANCE WITH ORDERS, PROHIBITIONS, AND/OR INJUNCTIONS ISSUED BY THE SECRETARY OF LABOR IN STRIKES INVOLVING HOSPITALS, CLINICS, & SIMILAR MEDICAL INSTITUTIONS (1) immediate disciplinary action against both union and employer (2) dismissal/loss of employment for members of the striking union (3) payment by employer of backwages, damages, and other affirmative relief (4) criminal prosecution against either or both the union and employer

who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status.

ILLEGAL STRIKE

Exception: When the worker participated in illegal acts during the strike.

Reasons for being illegal (1) Prohibited by law (2) Improper grounds (3) Noncompliance with procedural requirements (4) Unlawful means and methods (5) Violation of injunction order (6) No strike/lockout provisions in the CBA Purpose and means test There must be concurrence between the validity of the purpose of the strike and the means of conducting it. To be valid, a strike must be pursued within legal bounds. The right to strike as a means for the attainment of social justice is never meant to oppress or destroy the employer. The law provides limits for its exercise. Among such limits are the prohibited activities under Art. 264, particularly paragraph (e), which states that no person engaged in picketing shall:  commit any act of violence, coercion, or intimidation or  obstruct the free ingress to or egress from the employer's premises for lawful purposes or  obstruct public thoroughfares. (Association of Independent Unions in the Philippines (AIUP), et. al. v NLRC, 1999) LIABILITY OF UNION OFFICERS Any union officer who knowingly participates in an illegal strike and any worker or union officer

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Mere participation in an illegal strike by a union officer is sufficient ground to terminate his employment. In case of a lawful strike, the union officer must commit illegal acts during a strike for him to be terminated. LIABILITY OF ORDINARY WORKERS General rule: Participation by a worker in a lawful strike is not ground for termination of his employment.

When the strike is or becomes illegal, the workers who participate in it are not deemed to have lost their employment status by express omission in the second sentence of the third paragraph of Art. 264. Only the union officers are deemed to have lost their employment status. LIABILITY OF EMPLOYER Any worker whose employment has been terminated as a consequence of any unlawful lockout shall be entitled to reinstatement with full backwages. WAIVER OF ILLEGALITY OF STRIKE The defense of illegality will be considered waived if after the illegal strike, the employer voluntarily reinstates and accepts the striking workers back. However, this is only applicable for striker who signified their intent to come back and were reinstated.

INJUNCTIONS General rule: injunction prohibited Art. 260. No temporary or permanent injunction or restraining order in any case involving or growing out of labor disputes shall be issued by any court or other entity, except as otherwise provided in Articles 218 and 264 of this Code. REQUISITES FOR LABOR INJUNCTIONS Requisites for injunction to issue (Art. 224(e) – Powers of the NLRC)

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(1) actual or threatened commission of a prohibited or unlawful act OR requirement of performance of a particular act in a labor dispute (2) if unrestrained or unperformed, the act will cause grave or irreparable damage to any party OR render ineffectual any decision in favor of such party Prohibited activities (Art. 270) (1) No labor organization or employer shall declare a strike or lockout without first having bargained collectively in accordance with Title VII of this Book or without first having filed the notice required in the preceding Article or without the necessary strike or lockout vote first having been obtained and reported to the Ministry. No strike or lockout shall be declared after assumption of jurisdiction by the President or the Minister or after certification or submission of the dispute to compulsory or voluntary arbitration or during the pendency of cases involving the same grounds for the strike or lockout. Any worker whose employment has been terminated as a consequence of any unlawful lockout shall be entitled to reinstatement with full backwages. Any union officer who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status: Provided, That mere participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his employment, even if a replacement had been hired by the employer during such lawful strike. (2) No person shall obstruct, impede, or interfere with, by force, violence, coercion, threats or intimidation, any peaceful picketing by employees during any labor controversy or in the exercise of the right to self-organization or collective bargaining, or shall aid or abet such obstruction or interference.

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(3) No employer shall use or employ any strikebreaker, nor shall any person be employed as a strike-breaker. (4) No public official or employee, including officers and personnel of the New Armed Forces of the Philippines or the Integrated National Police, or armed person, shall bring in, introduce or escort in any manner, any individual who seeks to replace strikers in entering or leaving the premises of a strike area, or work in place of the strikers. The police force shall keep out of the picket lines unless actual violence or other criminal acts occur therein: Provided, That nothing herein shall be interpreted to prevent any public officer from taking any measure necessary to maintain peace and order, protect life and property, and/or enforce the law and legal order. (5) No person engaged in picketing shall commit any act of violence, coercion or intimidation or obstruct the free ingress to or egress from the employer’s premises for lawful purposes, or obstruct public thoroughfares. “INNOCENT BYSTANDER RULE” An innocent by-stander is entitled to injunction if it is affected by the activities of a picketing union where no connection or interest exists between the union and the innocent by-stander.

Procedure & Jurisdiction LABOR ARBITER JURISDICTION

Except as otherwise provided under the Code the Labor Arbiters shall original and exclusive jurisdiction to hear and decide: (1) Unfair labor practices cases; (2) Termination disputes; (3) If accompanied with a claim for reinstatement, those cases that workers may file involving wages, rates of pay, hours of work and other terms and conditions of employment; (4) Claims for actual, moral, exemplary and other forms of damages arising from the employer-employee relations;

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(5) Cases arising from any violation of Art. 264 of this Code, including questions involving the legality of strikes and lockouts; (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) regardless of whether accompanied with a claim for reinstatement. (Art. 217) (7) Money claims arising out of employeremployee relationship or by virtue of any law or contract, involving claims for actual, moral, exemplary an other forms of damages, as well as employment termination of OFWs; (8) Wage distortion disputes in unorganized establishments not voluntarily settled by the parties. (Art. 124) (9) Enforcement of compromise agreements when there is non-compliance by any of the parties. (Art. 227) (10) Other cases as may be provided by law. “Exclusive and Original” Jurisdiction subject to Articles 261 and 262. A case under Art 217 may be lodged instead with a voluntary arbitrator. The policy of the law is to give primacy to voluntary modes of settling dispute. VERSUS REGIONAL DIRECTOR Jurisdiction on Money Claims (Labor Arbiter vs. Regional Director) A money claim arising from employer-employee relations, except SSS, ECC/Medicare claims, is within the jurisdiction of a labor arbiter if: (1) The claim, regardless of amount, is accompanied with a claim of reinstatement; or (2) The claim exceeds P5,000, whether or not there is a claim for reinstatement. The Regional Director has jurisdiction if: (1) the money claim is not accompanied by reinstatement AND (2) the claim does not exceed P5,000 Notes:

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o The money claim must arise from law or contracts other than CBA. o Money arising from an implementation of the CBA – Voluntary Arbitrator or Panel of Voluntary Arbitrators have jurisdiction o Money claims which does not arise from EREE relations – Regular Courts have jurisdiction. o Nature of Proceeding: Non-litigious. The Labor Arbiter is not bound by the technical rules of procedure. o The Labor Arbiter shall use every and all reasonable means to ascertain the facts in each speedily and objectively. (Art. 221) o Employer-employee relationship is a jurisdictional requisite, absent of which, the NLRC has no jurisdiction to hear and decide the case. (Hawaiian-Philippine Company v. Gulmatico) o Venue: Regional Arbitration Branch (RAB) having jurisdiction over the workplace of the complainant or petitioner. o Workplace – place or locality where the employee is regularly assigned at the time the cause of action arose. o In the case of field employees, ambulant or itinerant workers, their workplace is (a) where they are regularly assigned or (b) where they are supposed to regularly receive their salaries and wages or work instructions from, and report the results of their assignment to their employers.

REINSTATEMENT PENDING APPEAL

An order for reinstatement entitles an employee to receive his accrued backwages from the moment the reinstatement order was issued up to the date when the same was reversed by a higher court without fear of refunding what he had received. (Garcia v. Philippine Airlines, Inc., G.R. No.164856, 2009)

NATIONAL LABOR RELATIONS COMMISSION (NLRC) JURISDICTION

NLRC divisions (1) Original Jurisdiction: Over petitions for injunction or temporary restraining order under Art. 218 (e).

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(2) Exclusive Appellate Jurisdiction: over all cases decided by labor arbiters (Art 217[b]) and the DOLE regional directors under Art 129. Period of Appeal (2005 NLRC Rules of Procedure) From Labor Arbiter to NLRC: Decisions and resolutions of the Labor Arbiter shall be final and executory unless appealed to the Commission by any or both parties within (10) calendar days from receipt thereof From Regional Director to NLRC pursuant to Art. 129: Decisions and resolutions of the Regional Director shall be final and executory unless appealed within 5 days from receipt thereof. Note: If the 5th or 10th day falls on a Saturday, Sunday, or a holiday, the last day shall be the next working day. Grounds of Appeal (1) If there is prima facie evidence of abuse of discretion on the part of the Labor Arbiter or Regional Director; (2) If the decision, resolution or order was secured through fraud or coercion, including graft and corruption; (3) If made purely on questions of law; and/or (4) If serious errors in the findings of fact are raised which, if not corrected, would cause grave or irreparable injury to the appellant Appeals must be verified and certified against forum-shopping by the parties-in-interest themselves. (Antonio B. Salenga, et al. v. CA, 2012)

EFFECT OF NLRC REVERSAL OF LABOR ARBITER’S ORDER OF REINSTATEMENT

Even if the order of reinstatement of the Labor Arbiter is reversed on appeal, it is obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee during the period of appeal until reversal by the higher court.

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On the other hand, if the employee has been reinstated during the appeal period and such reinstatement order is reversed with finality, the employee is not required to reimburse whatever salary he received for he is entitled to such, more so if he actually rendered services during the period. (Garcia v. Philippine Airlines, Inc., G.R. No.164856, 2009)

REMEDIES

Requisites for Perfection of Appeal to the Court of Appeals (Rule 43) (1) The appeal shall be: o Filed within the reglementary period; o Verified by the appellant himself in accordance with Section 4, Rule 7 of the Rules of Court; o In the form of a memorandum of appeal which shall state the grounds relied upon and the arguments in support thereof, the relief prayed for, and with a statement of the date the appellant received the appealed decision, resolution or order; o In three (3) legibly typewritten or printed copies; and o Accompanied by (a) proof of payment of the required appeal fee; (b) posting of a cash or surety bond as provided in Section 6 of the 2005 NLRC Rules, (c) a certificate of non-forum shopping; and (d) proof of service upon the other parties. (2) A mere notice of appeal without complying with the other requisites aforestated shall not stop the running of the period for perfecting an appeal. (3) The appellee may file with the Regional Arbitration Branch or Regional Office where the appeal was filed, his answer or reply to appellant’s memorandum of appeal, not later than 10 calendar days from receipt thereof. Failure on the part of the appellee who was properly furnished with a copy of the appeal to file his answer or reply within the said period may be construed as a waiver on his part to file the same. (4) Subject to the provisions of Article 218 of the Labor Code, once the appeal is perfected in accordance with these Rules, the Commission shall limit itself to reviewing and deciding only the specific issues that were elevated on appeal.

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CERTIFIED CASES DEFINITION Certified labor disputes are cases certified to the Commission for compulsory arbitration under Art. 263 (g) of the Labor Code. (Sec. 2, The 2011 NLRC Rules and Procedures) When, in his opinion, there exists a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to the national interest, the Secretary of Labor and Employment may assume jurisdiction over the dispute and decide it or certify the same to the Commission for compulsory arbitration. Such assumption or certification shall have the effect of automatically enjoining the intended or impending strike or lockout as specified in the assumption or certification order. (Art. 263) FUNCTION OF THE NLRC When sitting in a compulsory arbitration certified to by the Secretary of Labor, the NLRC is not sitting as a judicial court but as an administrative body charged with the duty to implement the order of the Secretary. (Union of Filipino Employees v. NLRC, 1990) PROCEDURE IN CERTIFIED CASES (1) When there is no need to conduct a clarificatory hearing, the Commission shall resolve all certified cases within 30 calendar days from receipt by the assigned Commissioner of the complete records, which shall include the position papers of the parties and the order of the SOLE denying the motion for reconsideration of the certification order, if any. (2) Where a clarificatory hearing is needed, the Commission shall, within 5 calendar days from receipt of the records, issue a notice to be served on the parties through the fastest means available, requiring them to appear and submit additional evidence, if any. All certified cases shall be resolved by the Commission within 60 calendar days from receipt of the complete records by the assigned Commissioner. (3) No motion for extension or postponement shall be entertained. (Sec. 5, 2011 NLRC Rules and Procedures)

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Upon issuance of the entry of judgment, the Commission motu proprio or upon motion by the proper party, may cause the execution of the judgment in the certified case. (Sec. 6, 2011 NLRC Rules and Procedures)

BUREAU OF LABOR RELATIONS – MED-ARBITERS JURISDICTION (ORIGINAL & APPELLATE) Art. 232. The Bureau of Labor Relations and the Labor Relations Divisions in the regional offices of the Department of Labor and Employment shall have original and exclusive authority to act, at their own initiative or upon request of either or both parties, on all inter-union and intra-union conflicts, and all disputes, grievances or problems arising from or affecting labor-management relations in all workplaces whether agricultural or non-agricultural, except those arising from the implementation or interpretation of collective bargaining agreements which shall be the subject of grievance procedure and/or voluntary arbitration. The Bureau shall have fifteen (15) calendar days to act on labor cases before it, subject to extension by agreement of the parties. APPELLATE JURISDICTION (1) BLR has the power to review the decision of the Regional Director (2) Decisions rendered through its appellate power are final and executory. Hence, the remedy of the aggrieved party is to seasonably avail of the special civil action of certiorari under Rule 65 of the Rules of Court.

NATIONAL CONCILIATION AND MEDIATION BOARD NATURE OF PROCEEDINGS

Conciliation and mediation is non-litigious/nonadversarial, less expensive, and expeditious. Under this informal set-up, the parties find it more expedient to fully ventilate their respective positions without running around with legal technicalities and, in the course thereof, afford

EXECUTION OF JUDGMENT

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them wider latitude of possible approaches to the problem.

CONCILIATION VS. MEDIATION

Conciliation A mild form of intervention by a neutral third party, the Conciliator-Mediator, relying on his persuasive expertise, takes an active role in assisting parties by trying to keep disputants talking, facilitating other procedural niceties, carrying messages back and forth between the parties, and generally being a good fellow who tries to keep things calm and forward-looking in a tense situation. Mediation A mild intervention by a neutral third party, the Conciliator-Mediator, wherein the CM advises the parties or offers solutions or alternatives to the problems with the end in view of assisting them towards voluntarily reaching their own mutually acceptable settlement of the dispute.

PREVENTIVE MEDIATION

Preventive mediation case — refers to the potential or brewing labor dispute which is the subject of a formal or informal request for conciliation and mediation assistance sought by either or both parties in order to remedy, contain or prevent its degeneration into a full blown dispute through amicable settlement.

DOLE REGIONAL DIRECTORS JURISDICTION

Small money claims Recovery of wages, simple money claims and other benefits. — Upon complaint of any interested party, the Regional Director of the Department of Labor and Employment or any of the duly authorized hearing officers of the Department is empowered, through summary proceeding and after due notice, to hear and decide any matter involving the recovery of wages and other monetary claims and benefits, including legal interest, owing to an employee or person employed in domestic or household service or househelper under this Code, arising from employer-employee relations: Provided, That

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such complaint does not include a claim for reinstatement: Provided, further, That the aggregate money claims of each employee or househelper do not exceed five thousand pesos (P5,000). The Regional Director or hearing officer shall decide or resolve the complaint within thirty (30) calendar days from the date of the filing of the same. o Any sum thus recovered on behalf of any employee or househelper pursuant to this Article shall be held in a special deposit account by, and shall be paid, on order of the Secretary of Labor and Employment or the Regional Director directly to the employee or househelper concerned. o Any such sum not paid to the employee or househelper, because he cannot be located after diligent and reasonable effort to locate him within a period of three (3) years, shall be held as a special fund of the Department of Labor and Employment to be used exclusively for the amelioration and benefit of workers. Xxx The Secretary of Labor and Employment or his duly authorized representative may supervise the payment of unpaid wages and other monetary claims and benefits, including legal interest, found owing to any employee or househelper under this Code. (Art. 129)

DOLE SECRETARY VISITORIAL POWERS

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ENFORCEMENT

Art. 128. The Secretary of Labor and Employment or his duly authorized representatives, including labor regulation officers, shall have access to employer’s records and premises at any time of the day or night whenever work is being undertaken therein, and the right to copy therefrom, to 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 this Code and of any labor law, wage order or rules and regulations issued pursuant thereto.

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Notwithstanding the provisions of Articles 129 and 217 of this Code to the contrary, and in cases where the relationship of employeremployee still exists, the Secretary of Labor and Employment or his duly authorized representatives shall have the power to issue compliance orders to give effect to the labor standards provisions of this Code and other labor legislation based on the findings of labor employment and enforcement officers or industrial safety engineers made in the course of inspection. The Secretary or his duly authorized representatives shall issue writs of execution to the appropriate authority for the enforcement of their orders, except in cases where the employer contests the findings of the labor employment and enforcement officer and raises issues supported by documentary proofs which were not considered in the course of inspection. Art. 37. The Secretary of Labor or his duly authorized representatives may, at any time, inspect the premises, books of accounts and records of any person or entity covered by this Title, require it to submit reports regularly on prescribed forms, and act on violation of any provisions of this Title. Art. 280. The Secretary of Labor and Employment or his duly authorized representative is hereby empowered to inquire into the financial activities of legitimate labor organizations upon the filing of a complaint under oath and duly supported by the written consent of at least twenty percent (20%) of the total membership of the labor organization concerned and to examine their books of accounts and other records to determine compliance or non-compliance with the law and to prosecute any violations of the law and the union constitution and by-laws: Provided, That such inquiry or examination shall not be conducted during the sixty (60)-day freedom period nor within the thirty (30) days immediately preceding the date of election of union officials.

effects of the termination pending resolution of the dispute in the event of a prima facie finding by the appropriate official of the Department of Labor and Employment before whom such dispute is pending that the termination may cause a serious labor dispute or is in the implementation of a mass lay-off.

POWER TO SUSPEND/EFFECTS OF TERMINATION

SUBJECT MATTER OF GRIEVANCE

Article 283 (b). The Secretary of the Department of Labor and Employment may suspend the

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ASSUMPTION OF JURISDICTION Art. 269 (g). When in his opinion, there exist a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to the national interest, the SOLE may assume jurisdiction over the dispute and decide it or certify the same to the Commission for compulsory arbitration.

APPELLATE JURISDICTION

(1) Orders issued by the duly authorized representative of the SOLE under Art. 128 may be appealed to the latter. (2) Denial of application for union registration or cancellation of union registration originally rendered by the BLR may be appealed to the SOLE (if originally rendered by the Regional Office, appeal should be made to the BLR) (3) Decisions of the Med-Arbiter in certification election cases are appealable to the SOLE (decisions of med-arbiters in intra-union disputes are appealable to the BLR) [Art. 259]

VOLUNTARY ARBITRATION POWERS Art. 269 (h). Before or at any stage of the compulsory arbitration process, the parties may opt to submit their dispute to voluntary arbitration. Art. 269 (i). The Secretary of Labor and Employment, xxx shall decide or resolve the dispute xxx.

GRIEVANCE MACHINERY VOLUNTARY ARBITRATION

&

Grievance is any question by either the ER or the union regarding the interpretation or application of the CBA or company personnel policies or any claim by either party that the

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other party is violating any provisions of the CBA or company personnel policies. It is a complaint or dissatisfaction arising from the interpretation or implementation of the CBA and those arising from interpretation or enforcement of personnel policies Grievance machinery It refers to the mechanism for the adjustment and resolution of grievances. It is part of the continuing process of collective bargaining.

VOLUNTARY ARBITRATOR JURISDICTION Exclusive and original jurisdiction over grievances The VA or panel of VAs shall have original and exclusive jurisdiction to hear and decide all unresolved grievances. Violations of a CBA, except those which are gross in character, shall no longer be treated as ULP and shall be resolved as grievances under the CBA. Note: Gross violations of CBA shall mean flagrant and/or malicious refusal to comply with the economic provisions of such agreement. Art. 267. The Commission, its Regional Offices and the Regional Directors of the DOLE shall not entertain disputes, grievances or matters under the exclusive and original jurisdiction of the Voluntary Arbitrator or panel of Voluntary Arbitrators and shall immediately dispose and refer the same to the grievance machinery or Voluntary Arbitration provided in the Collective Bargaining Agreement. Other labor disputes The VA or panel of VAs, upon agreement of the parties, shall also hear and decide all other labor disputes including ULP and bargaining deadlocks. (Art. 268) PROCEDURE (IRR, BOOK V, RULE XI) Hearing All parties to the dispute shall be entitled to attend the arbitration proceedings. The attendance of any third party or the exclusion of any witness from the proceedings shall be

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determined by the VA or panel of Vas. Hearing may be adjourned for cause or upon agreement by the parites. Days to render an award/decision Unless the parties agree otherwise, it shall be mandatory for the VA or panel of Vas to render an award or decision within 20 calendar days from the date of submission of the dispute to voluntary arbitration. Form of award/decision The award or decision of the VA or panel of Vas must state in clear, concise and definite terms the facts, the law and/contract upon which it is based. Finality It shall be final and executory after 10 calendar days from the receipt of the copy of the award or decision by the parties. Execution of award/decision Upon motion of any interested party, the Voluntary Arbitrator or panel of Voluntary Arbitrators or the Labor Arbiter in the region where the movant resides, in case of the absence or incapacity of the Voluntary Arbitrator or panel of Voluntary Arbitrators, for any reason, may issue a writ of execution requiring either the sheriff of the Commission or regular courts or any public official whom the parties may designate in the submission agreement to execute the final decision, order or award. (Art, 262-A, LC) REMEDIES Rule 43 Sec. 1, Rules of Court The decision of a Voluntary Arbitrator or panel of Voluntary Arbitrators is appealable by ordinary appeal under Rule 43 of the Rules of Civil Procedure directly to the Court of Appeals.

COURT OF APPEALS RULE 65, RULES OF COURT

Section 1. Petition for certiorari. — When any tribunal, board or officer exercising judicial or quasi-judicial functions has acted without or in excess its or his jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and there is no appeal, or any plain,

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speedy, and adequate remedy in the ordinary course of law, a person aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty and praying that judgment be rendered annulling or modifying the proceedings of such tribunal, board or officer, and granting such incidental reliefs as law and justice may require. The petition shall be accompanied by a certified true copy of the judgment, order or resolution subject thereof, copies of all pleadings and documents relevant and pertinent thereto, and a sworn certification of non-forum shopping as provided in the third paragraph of section 3, Rule 46. (1a) Section 2. Petition for prohibition. — When the proceedings of any tribunal, corporation, board, officer or person, whether exercising judicial, quasi-judicial or ministerial functions, are without or in excess of its or his jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and there is no appeal or any other plain, speedy, and adequate remedy in the ordinary course of law, a person aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty and praying that judgment be rendered commanding the respondent to desist from further proceedings in the action or matter specified therein, or otherwise granting such incidental reliefs as law and justice may require. The petition shall likewise be accompanied by a certified true copy of the judgment, order or resolution subject thereof, copies of all pleadings and documents relevant and pertinent thereto, and a sworn certification of non-forum shopping as provided in the third paragraph of section 3, Rule 46. (2a) Section 3. Petition for mandamus. — When any tribunal, corporation, board, officer or person unlawfully neglects the performance of an act which the law specifically enjoins as a duty resulting from an office, trust, or station, or unlawfully excludes another from the use and enjoyment of a right or office to which such other is entitled, and there is no other plain, speedy and adequate remedy in the ordinary course of law, the person aggrieved thereby may

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file a verified petition in the proper court, alleging the facts with certainty and praying that judgment be rendered commanding the respondent, immediately or at some other time to be specified by the court, to do the act required to be done to protect the rights of the petitioner, and to pay the damages sustained by the petitioner by reason of the wrongful acts of the respondent.

SUPREME COURT Therefore, all references in the amended Section 9 of B.P. No. 129 to supposed appeals from the NLRC to the Supreme Court are interpreted and hereby declared to mean and refer to petitions for certiorari under Rule 65. Consequently, all such petitions should hence forth be initially filed in the Court of Appeals in strict observance of the doctrine on the hierarchy of courts as the appropriate forum for the relief desired. (St. Martin Funeral Home vs. NLRC, 1998)

PRESCRIPTION OF ACTIONS No claim for compensation shall be given due course unless said claim is filed with the System within three (3) years from the time the cause of action accrued. (Article 201, as amended by Section 5, Presidential Decree No. 1921) (1) MONEY CLAIMS Art. 297. Money claims. – All money claims arising from employer-employee relations accruing during the effectivity of this Code shall be filed within three (3) years from the time the cause of action accrued; otherwise they shall be forever barred. All money claims accruing prior to the effectivity of this Code shall be filed with the appropriate entities established under this Code within one (1) year from the date of effectivity, and shall be processed or determined in accordance with the implementing rules and regulations of the Code; otherwise, they shall be forever barred. Workmen's compensation claims accruing prior to the effectivity of this Code and during the period from November 1, 1974 up

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to December 31, 1974, shall be filed with the appropriate regional offices of the Department of Labor not later than March 31, 1975; otherwise, they shall forever be barred. The claims shall be processed and adjudicated in accordance with the law and rules at the time their causes of action accrued. The Labor Code has no specific provision on when a monetary claim accrues. Thus, again the general law on prescription applies. Article 1150 of the Civil Code provides that: Article 1150. The time for prescription for all kinds of actions, when there is no special provision which ordains otherwise, shall be counted from the day they may be brought. Illegal dismissal In illegal dismissal cases, the employee concerned is given a period of four years from the time of his dismissal within which to institute a complaint. This is based on Article 1146 of the New Civil Code which states that actions based upon an injury to the rights of the plaintiff must be brought within four years. (Victory Liner, Inc. v Race, 2007) Article 1146. The following actions must be instituted within four years: (a) Upon an injury to the rights of the plaintiff; (b) Upon a quasi-delict;

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the preceding paragraph. During the pendency of such administrative proceeding, the running of the period of prescription of the criminal offense herein penalized shall be considered interrupted: Provided, however, that the final judgment in the administrative proceedings shall not be binding in the criminal case nor be considered as evidence of guilt but merely as proof of compliance of the requirements therein set forth. (As amended by Batas Pambansa Bilang 70, May 1, 1980 and later further amended by Section 19, Republic Act No. 6715, March 21, 1989) (3) OFFENSES

PENALIZED BY THE LABOR CODE & IRR ISSUED PURSUANT THERETO Art. 290. Offenses penalized under this Code and the rules and regulations issued pursuant thereto shall prescribe in three (3) years.

(4) PRESCRIPTIVE PERIOD OF ILLEGA

L RECRUITMENT CASES Section 7. Prescription. Illegal recruitment cases under this Rule shall prescribe in five (5) years; Provided, however, that illegal recruitment cases involving economic sabotage shall prescribed in twenty (20) years. (RA 804)

(2) UNFAIR LABOR PRACTICE Art. 296. Offenses penalized under this Code and the rules and regulations issued pursuant thereto shall prescribe in three (3) years. All unfair labor practice arising from Book V shall be filed with the appropriate agency within one (1) year from accrual of such unfair labor practice; otherwise, they shall be forever barred. Art. 253. Concept of unfair labor practice and procedure for prosecution thereof. (last par.) No criminal prosecution under this Title may be instituted without a final judgment finding that an unfair labor practice was committed, having been first obtained in

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Social Welfare Legislation SSS

GSIS

Enabling law RA 1161 as amended by RA 8282: Social Security Act of 1997

RA 8291 amending PD 1146

Definition of Employer – any person, natural or juridical, domestic or Terms foreign, who carries on in the Philippines any trade business, industry, undertaking, and uses the services of another person who is under his orders as regards the employment, except those considered as employer under the GSIS. A selfemployed person shall be both employer and employee at the same time.

Employer – National government, its political subdivisions, branches, agencies or instrumentalities, including government-owned or controlled corporations and financial institutions with original charters (GOCCs); constitutional commissions; and judiciary

Employee – any person who performs services for an employer in which either or both mental and physical efforts are used and who receives compensation for such services, where there is an employer—employee relationship; also, a self-employed person who is both employee and employer at the same time

Employee – any person receiving compensation while in service of an employer whether by election or appointment, irrespective of status of appointment; baranggay officials; and sangguniang officials

Self-employed – any person whose income is not derived from employment, including, but not limited to: Note: No employed.  self-employed professionals;  partners and single proprietors of businesses;  actors, directors, scriptwriters, news correspondents not considered as employees under the above definition;  athletes, coaches, trainers, jockeys; and  individual farmers and fishers.

counterpart

for

self-

Dependents: Same except that a child here is below 18  Legal spouse entitled by law to receive support;  Child – unmarried, not gainfully employed, and below 21 or  Child over 21 if he or she became permanently incapacitated and incapable of self-support, physically or mentally,; child may be legitimate, legitimated, legally adopted, or illegitimate;  Parent who is receiving regular support. Beneficiaries Same except that RA 8291 does not distinguish share of legitimate and - Primary illegitimate children  Dependent spouse – until remarriage (see above);  Dependent children (see above); illegitimate children are entitled only to 50% of the share of legitimate children unless there are no legitimate children, in which case, they get 100%. - Secondary – shall only receive when the primary beneficiaries are absent: Dependent parents - Other – any other person designated by the member as his/her secondary beneficiary. Compensation – all actual remuneration for employment, including living allowance, as well as the cash value of any remuneration paid in any medium other than cash except that portion already above the max salary credit under Sec. 18 of the Act.

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Compensation – basic pay received excluding per diems, bonuses, overtime, honoraria, allowances and other emoluments not integrated into the basic pay under existing laws.

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Compulsory  Employers as defined above;  Employees not over 60 years including household helpers with at least P1,000 monthly pay; and  Self-employed.  Domestic worker who has rendered at least one month of service

Public sector employees below the compulsory retirement age of 65.

Exceptions: a. AFP and PNP; b. Members of the Judiciary and Constitutional Commissions who are covered only by life insurance as they have separate retirement Voluntary schemes;  Spouses who devote full time to managing household and c. Contractual employees with no family affairs; employee-employer relationship  OFWs recruited by foreign-based employers; with the agency they serve.  Employees already separated from employment or those self-employed with no realized income for a given month, who chose to continue with contributions to maintain right to full benefit. Note: Foreign governments, international organizations or their wholly owned instrumentality employing workers in the Philippines may enter into an agreement with the Philippine government to include their employees in the SSS except those already covered by their civil service retirement system. st

Effective Employer: 1 day of operation st Date of Employee: 1 day at work Coverage Self-employed: upon registration with SSS Summary of a) Benefits b) c) d) e) f) g)

Monthly pension Dependents’ pension Retirement benefits Permanent disability benefits Death benefits Funeral benefits Loan – Social Security Commission Resolution No. 669. Moreover, several SSS-issued circulars such as Circular No. 21-P and No. 52 pertain to the treatment of salary loans, sometimes providing for more flexible payment terms or condonation for delinquent payers; Santiago v. CA and SSS, GR # L-39949 (1984) resolved an issue involving the treatment of salary loan repayments; SSS website also shows loans h) Sickness benefits i) Maternity leave benefits

SSS LAW (RA 8282) EXCLUSIONS FROM COVERAGE

(SEC. 8 [J]) (1) Employment purely casual and not for the purpose of occupation or business of the employer;

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a) b) c) d) e) f)

Monthly pension Retirement benefits Permanent disability benefits Death Benefits Funeral benefits Loan – GSIS website provides for this g) Temporary disability benefits (similar to sickness) h) Separation benefits i) Unemployment benefits – Sec 11 j) Survivorship benefits k) Life insurance benefits Note: Judiciary and Constitutional Commissions are entitled to life insurance only.

(2) Service performed on or in connection with an alien vessel by an employee if he is employed when such vessel is outside the Philippines; (3) Service performed in the employ of the Philippine Government or instrumentality or agency thereof;

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(4) Service performed in the employ of a foreign government or international organization, or their wholly-owned instrumentalities; and (5) Services performed by temporary and other employees which may be excluded by SSS regulation. Employees of bona fide independent contractors shall not be deemed employees of the employer engaging the services of said contractors.

BENEFITS (1) MONTHLY PENSION (SEC.12) Computation of monthly pension The monthly pension shall be the highest of the following amounts: (a) P300 + [20% x (ave. monthly credit)] + [2% x (ave. monthy credit) x (# of cash credited years of service in excess of 10 years)]; or (b) 40% x (ave. monthly credit); or (c) P1,000; provided, that the monthly pension shall in no case be paid for an aggregate amount of less than 60 months. (d) Notwithstanding the abovementioned, minimum pension is P1,200 for members with at least 10 years credit service, P2,400 for those with 20 years. (2) DEPENDENTS’ PENSION (SEC. 12-A) (a) Paid when member dies, retires or with permanent total disability; (b) Paid to each child conceived on or prior to contingency, but not exceeding 5, beginning with the youngest and preferring the legitimate; (c) Amount is either P250 or 10% of the monthly pension as computed above, whichever is higher. (3) RETIREMENT BENEFITS (SEC. 12-B) Eligibility requirements (1) 120 monthly contributions; (2) Age (a) 65 years old; or (b) a member who has reached 60 years may also avail if he is already separated from employ-ment or has ceased to be selfemployed.

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Lump Sum Alternative Member may opt to receive his first 18 monthly pensions in lump sum but such is discounted at a preferential rate of interest. Lump Sump Eligible A 60 year old member with less than 120 monthly contributions who is no longer employed or self-employed, and who is not continuing contributions independently, he is entitled to a lump sum equal to his total contributions paid. (4) PERMANENT DISABILITY BENEFITS (SEC. 13-A) Eligibility requirement 36 monthly contributions prior to the semester of disability; same as death benefit; only difference is that the pension is paid directly to the member. In case the permanently disabled member dies, it would be given the same treatment as a retiree dying. For permanent partial disability, the pension is not lifetime. (e.g. loss of thumb entitles member to only 10 months of pension, while loss of arm 50 months). It shall be paid in lump sum if the period is less than 12 months. For multiple partial disabilities, they shall be additive when related or deteriorating – the percentage shall be equal to the number of months the partial disability is entitled to divided by 75 months. (e.g. loss of sight in one eye  25/75; loss of arm  50/75; if both occur due to same cause, then 25/75 + 50/75 = 100% so treated as if it were permanent total disability) (5) DEATH BENEFITS (SEC. 13) Eligibility requirement 36 monthly contributions prior to the semester of death. Benefit – monthly pension to primary or secondary beneficiaries.

Benefit – entitlement to monthly pension from retirement until death.

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To those ineligible – lump sum benefit which shall be the higher between the two:  (monthly pension) x 12; or  (monthly pension) x (# of monthly contributions)

(limited only to first four deliveries or miscarriage)

(6) FUNERAL BENEFITS (13-B)

(1) Primary (i) Dependent spouse – until remarriage (see above); (ii) Dependent children (legitimate, legitimated, legally adopted, and illegitimate) (see above); illegitimate children are entitled only to 50% of the share of legitimate children unless there are no legitimate children, in which case, they get 100%. (2) Secondary – shall only receive when the primary beneficiaries are absent (i) Dependent parents (3) Others – shall only receive when the primary and secondary beneficiaries are absent (i) Any other person designated by member as his/her secondary beneficiary.

P12,000 in cash or in kind, upon death of member (7) LOAN Social Security Commission Resolution No. 669. Moreover, several SSS-issued circulars such as Circular No. 21-P and No. 52 pertain to the treatment of salary loans, sometimes providing for more flexible payment terms or condonation for delinquent payers; Santiago v. CA and SSS, GR # L-39949 (1984 )resolved an issue involving the treatment of salary loan repayments; SSS website also shows loans (8) SICKNESS BENEFITS (SEC. 14) Eligibility requirements and other conditions (1) Inability to work due to sickness or injury (2) Confined for at least 4 days either in a hospital or elsewhere with SSS approval; (3) At least 3 months of contributions in the 12 month period immediately before the semester of sickness or injury has been paid; (4) All company sick leaves with pay for the current year has been used up; (5) Maximum of 120 days per 1 calendar year (so maximum permissible for the same sickness and confinement is 240 days for 2 consecutive years); (6) The employer has been notified, or, if a separated, voluntary or self-employed member, the SSS directly notified within 5 days of confinement; (7) Notice to employer or SSS not needed when confinement is in a hospital; notice to employer not required as well when Employee became sick or injured while working or within premises of the employer.

Note: All of these benefits are tax-exempt.

BENEFICIARIES

Benefit: daily cash allowance paid for the number of days a member is unable to work due to sickness or injury equivalent to 90% x (average daily salary credit) (9) MATERNITY LEAVE BENEFITS (SEC. 14-A)

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GSIS (RA 8291) BENEFITS

(1) MONTHLY PENSION The amount shall be: (a) 37.5% x (revalued ave. monthly compensation) (b) Plus 2.5 x (revalued ave. monthly compensation) x (years in service in excess of 15 years). The monthly pension shall not exceed 90% of the average monthly compensation. It shall not be less than P2,400 for those with 20 years of service and not less than P1,300 for everyone else. (2) RETIREMENT BENEFITS Eligibility requirements (a) 15 years service; (b) 60 years of age; and (c) Not receiving pension benefit from permanent total disability. Note: Retirement is compulsory for employees 65 years of age who have rendered at least 15 years of service; if employee has less than 15 years of service, he may be allowed to continue in accordance with civil service laws. Benefit: choice between (a) 60 x (basic monthly pension) lump sum payment at the time of retirement plus basic monthly pension payable monthly for life after expiry of the 5-year guaranteed period which is already covered by the lump sum; or (b) Cash payment equivalent to 18 x (basic monthly pension) plus monthly pension for life immediately but with no 5-year guarantee (3) PERMANENT DISABILITY BENEFITS Eligibility requirements for Permanent Total Disability (1) Disability not due to employee’s own grave misconduct, notorious negligence, habitual intoxication, or willful intention to kill himself or another;

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(2) Employee is: in service at the time of disability; or b) even if separated, he has paid at least 36 monthly contributions within the 5-year period immediately prior to disability or has paid a total of at least 180 monthly contributions prior to disability; and (3) Member is not enjoying old-age retirement benefit. Benefit for Permanent Total Disability Monthly income benefit for life equal to basic monthly pension – This is effective from date of disability; If member is in service at the time of disability and he has paid at least 180 monthly contributions, in addition to the monthly income benefit, he shall receive an additional cash payment of 18 times basic monthly pension. To the ineligible If member has rendered at least 3 years of service, then he shall receive cash payment equal to 100% of ave. monthly compensation for each year of service (essentially total amount of contributions made) or P12,000 whichever is higher. Partial Disability Paid according to GSIS prescribed schedule (this is similar to the scheme used by SSS; refer to section II subsection D-3 above); member availing of permanent partial disability must satisfy condition E.1.a. above regarding the disability not being due to his own fault and either E.1.b.i. or E.1.b.ii. regarding employment status and services rendered. (4) DEATH BENEFITS When member dies, the primary beneficiaries are entitled to only one of the following: (a) Survivorship pension (i) If he was in the service when he died; or (ii) Even if separated from the service, he has at least 3 years of service and has paid 36 monthly contributions within the 5 years immediately preceding death; or (iii) Even if separated from the service, he has paid 180 monthly contributions prior to death.

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(b) Survivorship pension plus cash payment of 100% ave. monthly compensation for every year of service (so essentially, pension plus total contributions made) (i) If he was in the service when he died; and (ii) With 3 years of service. (c) Cash payment equivalent to 100% ave. monthly compensation for each year of service he paid contributions or P12,000 whichever is higher (i) With 3 years of service; and (ii) He has failed to qualify in the prior 2 schemes. (5) FUNERAL BENEFITS Fixed by GSIS rules and regulations Entitled to this are the following: (1) Active member; (2) Member separated from service but still entitled to funeral benefit; (3) Pensioner; (4) Retiree who at the time of retirement was of pensionable age but opted to retire under RA 1616. (6) LOAN – GSIS website provides for this (7) TEMPORARY DISABILITY (SIMILAR TO SICKNESS)

BENEFITS

Eligibility requirements and other conditions: (1) Employee must be (a) in service at the time of disability; or (b) if separated, he has rendered at least 3 years of service and paid at least 6 monthly contributions in the 12 month period immediately prior to disability; (2) All sick leave credits including CBA sick leaves for the current year has been used up; and (3) Maximum of 120 days per 1 calendar year (so maximum permissible for the same sickness and confinement is 240 days for 2 consecutive years). Benefit 75% of the current daily compensation for every day or fraction thereof of disability or P70 whichever is higher.

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(8) SEPARATION BENEFITS Eligibility requirements (1) 60 years of age, or separation from service with at least 3 years but not over 15 years served (2) Below 60 years of age, but at least 15 years of service rendered. Benefit (1) For 60 years of age or separated from service with 3 to 15 years of service: cash payment of 100% of ave. monthly compensation for each year of service (so essentially, the total amount of all contributions paid) or P12,000 whichever is higher. (2) Below 60 years of age and at least 15 years of service: cash payment equivalent to 18 x (monthly pension) at the time of resignation or separation plus an old-age pension benefit equal to basic monthly pension. (9) UNEMPLOYMENT BENEFITS (SEC 11) Eligibility requirements (a) Employee separated from service due to abolition of his office or position; and (b) Employee has been paying integrated contributions for at least 1 year prior to separation. Benefit Monthly cash payments of 50% of average monthly compensation for a duration which is proportional to years rendered, ranging from 2 months to 6 months. (10) SURVIVORSHIP BENEFITS Beneficiaries are entitled to the following: (a) Basic survivorship pension which is 50% of basic monthly pension; and (b) Dependent children’s pension not exceeding 50% of the basic monthly pension. (11) LIFE INSURANCE BENEFITS Note: Judiciary and Constitutional Commissions are entitled to life insurance only.

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1)

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BENEFICIARIES

i. ii.

Primary Dependent spouse – until remarriage; Dependent children (legitimate, legitimated, legally adopted, and illegitimate) – but RA 8291 does not distinguish share of legitimate and illegitimate children.

2) Secondary – shall only receive when the primary beneficiaries are absent i. Dependent parents ii. Legitimate descendants, subject to the restrictions on dependent children

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LABOR STANDARDS

LIMITED PORTABILITY LAW (RA 7699) COVERAGE

(1) Workers who transfer employment from one sector to another; or (2) Those employed in both sectors (public and private).

PROCESS

The covered worker shall have his credible services or contributions in both Systems credited to his service or contribution record in each of the Systems and shall be totalized for purposes of old-age, disability, survivorship and other benefits in case the covered member does not qualify for such benefits in either or both systems without totalization: Provided, however, That overlapping periods of membership shall be credited only once for purposes of totalization (Sec. 3) “Totalization” shall refer to the process of adding up the periods of creditable services or contributions under each of the Systems, for purposes of eligibility and computation of benefits (Sec. 2e). Overlapping periods of membership in case of those employed in both sectors at once are to be counted only ONCE for purposes of totalization to be able to satisfy eligibility requirements of benefits provided for by either SSS or GSIS.

EMPLOYEE’S COMPENSATION – COVERAGE & WHEN COMPENSABLE

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(4) An employee who is coverable by both the GSIS and SSS shall be compulsorily covered by both Systems. (Sec. 2, IRR of Title II, Book IV of LC) (5) Filipinos working abroad in the service of an employer as defined in Section 3 hereof shall be covered by the System, and entitled to the same benefits as are provided for employees working in the Philippines. (Sec. 5, IRR of Title II, Book IV of LC)

EFFECTIVITY

Coverage of employees shall take effect on the first day of employment. (Sec. 6)

WHEN COMPENSABLE

Grounds: (1) 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. (2) For the sickness and the resulting disability or death to be compensable, the sickness must be the result of an occupational disease listed under Annex “A” of these 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. Limitation: No compensation shall be allowed to the employee or his dependents when the injury, sickness, disability, or death was occasioned by any of the following: (1) his intoxication; (2) his willful intention to injure or kill himself or another; or (3) his notorious negligence (4) As otherwise provided by law

COVERAGE

(1) Every employer shall be covered. (2) Every employee not over sixty (60) years of age shall be covered. (3) An employee over sixty (60) years of age shall be covered if he had been paying contributions to the System prior to age sixty (60) and has not been compulsorily retired.

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