Labor Standards Digests 1

Labor Standards Digest Matrix 1 – Stef Macapagal

Guideposts of Labor Law Title PASEI v . Drilo n GR No. 81958 30 June 1998 Sarmiento, J.

Facts The Department of Labor and Employment issued Department Order No. 1, entitled “Guidelines Governing the Temporary Suspension of Deployment of  Filipino Domestic and Household Workers.” Philippine Association of  Service Exporters, Inc., a firm engaged principally in the recruitment of Filipino workers, male and female, for overseas placement, challenges the DO for being unconstitutional.

Issue/s W/N Department Order No. 1 is a valid implementation of the Labor  Code.

ISAE v. Quisumbing GR No. 128845 1 June 2000  Kapunan, J.

International School is a domestic educational institution established  primarily for dependents of foreign diplomatic personnel and other  temporary residents. As such, it hires  both foreign and local teachers as members of its faculty, classifying them into (1) foreign-hires; and (2) local-hires. The foreign hires get higher salaries and more benefits than their local counterparts, which is  justified by the school with 2 significant economic disadvantages: (a) the dislocation factor, and (b) limited tenure.

W/N the point-of-hire classification employed by IS is discriminatory to Filipinos.

The local hires decry this classification as being discriminatory. The DOLE initially ruled in favor of the school.

W/N the foreign-hires should belong to the same bargaining unit as the local-hires.

Ruling YES. The Labor Code itself vests the DOLE with rulemaking powers in the enforcement thereof, and DO 1 is a valid implementation of the basic  policy of the Labor Code, namely to “afford protection to labor.” It is bad enough that the country has to se nd its sons and daughters to strange lands because it cannot satisfy their  employment needs at home. Under  these circumstances, the Government is duty-bound to insure that our  toiling expatriates have adequate  protection, personally and economically, while away from home. YES. There is no reasonable distinction between the services rendered by foreign-hires and localhires. Although the school contends that the ISAE has not adduced evidence that local-hires perform work equal to that of the foreignhires, the presumption is that employees which have the same  position and rank perform equal work. There is no evidence that foreign-hires perform 25% more efficiently or effectively than the local-hires. Both groups have similar  functions and responsibilities, which they perform under similar working conditions. While the Court recognizes the need of the school to attract foreign-hires, salaries should not be used as an enticement to the  prejudice of local-hires. The localhires perform the same services as foreign-hires and they ought to be  paid the same salaries as the latter.

 NO. The basic test of an asserted  bargaining unit’s acceptability is whether or not it is fundamentally the combination which will best assure to all employees the exercise of their  collective bargaining rights.

Doctrine “Protection to labor” does not signify the promotion of employment alone. What concerns the Constitution more  paramountly is that such an employment be, above all, decent,  just, and humane.

“Equal pay for equal work” –  Persons who work with substantially equal qualifications, skill, effort and responsibility, under similar  conditions, should be paid similar  salaries. Discrimination, particularly in terms of wages, is frowned upon by the Labor Code. The Constitution enjoins the State to “protect the rights of workers and  promote their welfare,” “to afford labor full protection.” The State, therefore, has the right and duty to regulate the relations between labor  and capital. These relations are not merely contractual but are so impressed with public interest that labor contracts, collective bargaining agreements included, must yield to the common good. A bargaining unit is a group of  employees of a given employer, comprised of all or less than a ll of the entire body of employees, consistent with equity to the employer, indicate to be the best suited to serve the

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Labor Standards Digest Matrix 1 – Stef Macapagal

Although foreign-hires perform similar functions under the same working conditions as the local-hires, foreign-hires are accorded certain  benefits not granted to local-hires. These benefits are reasonably related to their status as foreign-hires, and  justify the exclusion of the former  from the latter. To include foreignhires in a bargaining unit with localhires would not assure either group the exercise of their respective collective bargaining rights.

reciprocal rights and duties of the  parties under the collective  bargaining provisions of the law.

Obiter: The Constitution specifically  provides that labor is entitled to “humane conditions of work.” These conditions are not restricted to the  physical workplace—the factory, the office, or the field—but include as well the manner by which e mployers treat their employees.

UST Faculty Union, et al. v. Bitonio GR No. 131235 16 November 1999  Panganiban, J.

When a notice was posted that the UST Faculty Union was to hold its election of new officers on 5 October  1996, the old set of officers contested this notice because the Commission on Elections that the notice was constituted was allegedly not in accordance with the USTFU’s constitution and by-laws. The MedArbiter issued a TRO enjoining the new officers from conducting the elections.

W/N the election of new officers was a legitimate exercise of USTFU’s members’ right to self-organization.

The Constitution also directs the State to promote “equality of  employment opportunities for all.” Similarly, the Labor Code provides that the State shall “ensure equal work opportunities regardless of sex, race, or creed.” It would be an affront to both the spirit and the letter of  these provisions if the State, in spite of its primordial obligation to  promote and ensure equal employment opportunities, closes its eyes to unequal and discriminatory terms and conditions of employment.  NO. The said election is not binding,  because it cannot be properly called a union election for the procedures laid down in the USTFU’s CBL was not followed. 1. The The 4 Octo Octobe berr ass assem embl bly y was not called by the USTFU. It was merely a convocation of faculty clubs. It was not convened in accordance with the provision on

Self-organization is a fundamental right guaranteed by the Philippine Constitution and the Labor Code. Employees have the right to form,  join, or assist labor organizations for  the purpose of collective bargaining or for their mutual aid and protection. Whether employed for a definite  period or not, any employee shall be considered as such, beginning on his first day of service, for purposes of  membership in a labor union.

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Labor Standards Digest Matrix 1 – Stef Macapagal

The TRO notwithstanding, a general assembly was called for by the secretary general of the UST on 4 October 1996, where a new set of  USTFU officers were elected by acclamation and clapping of hands. Some of the participants were not members of the USTFU. The new set of officers subsequently entered into another CBA with UST from June 1996 to May 2001. Acting upon the petition of the old officers, Director Bitonio, the labor  secretary, held that the 4 October  1996 election was void.

2.

3.

W/N the Constitution and Bylaws of  the USTFU were suspended during the 4 October elections.

W/N the ratification of the new CBA validated the 4 October elections.

Calalang v. Williams GR No. L-47800 2 December 1940  Laurel, J.

The National Traffic Commission recommended to the Director of  Public Works that animal-drawn vehicles be prohibited from passing

W/N CA No. 548 constitutes undue delegation of legislative power.

general membership meetings as found in the USTFU’s CBL. There was no Commission on Elections to oversee the election, as mandated by the USTFU’s CBL. The The pur purpo port rted ed elec electi tion on was not done by secret  balloting, in violation of  the USTFU’s CBL.

 NO. The union’s CBL is the fundamental law that governs the relationship between and among the members of the union. It is where the rights, duties and obligations,  powers, functions, and authority of  the officers as well as the members are defined. It is the organic law that determines the validity of acts done  by any officer or member of the union. Without respect for the CBL, a union as a democratic institution degenerates into nothing more than a group of individuals governed by mob rule. Moreover, allowing a nonunion member to initiate the suspension of a union’s CBL, and non-union members to participate in a union election on the premise that the union’s CBL had been suspended in the meantime, is incompatible with the freedom of association and  protection of the right to organize.  NO. Ratified were the new terms of  the new CBA, not the issue of union leadership—a matter that should be decided only by union members in the proper forum at the proper time and after observance of proper   procedures.

 NO. The provisions of CA 548 does not confer legislative power upon the Director of Public Works and the Secretary of Public Works and

Corollary to this right is the  prerogative not to join, affiliate with or assist a labor union. To become a union member, an employee must, as a rule, not only signify the intent to become one, but also take some positive steps to realize that intent. An employee who  becomes a union member acquires the rights and the concomitant obligations that go with this new status and becomes bound by the union’s rules and regulations. Union election v. Certification election – A union election is held  pursuant to the union’s constitution and bylaws, and the right to vote in it is enjoyed only by union members. A certification election is the process of  determining, through secret ballot, the sole and exclusive bargaining agent of the employees in the appropriate bargaining unit, for   purposes of collective bargaining. All employees belonging to the appropriate bargaining unit can vote. The importance of a union’s constitution and bylaws embody a covenant between a union and its members and constitute the fundamental law governing the members’ rights and obligations. Where ILO Convention No. 87 speaks of a union’s full free dom to draw up its constitution and rules, it includes freedom from interference  by persons who are not members of  the union. Mob hysteria, however wellintentioned, is not a substitute for the rule of law. The Legislature cannot delegate its  power to make the law; but it can make a law to delegate a power to determine some fact or state of things

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Labor Standards Digest Matrix 1 – Stef Macapagal

on Rizal Avenue from the points of  Antipolo Street to Azcarraga Street at specific times during the day.

Communications. The delegated  power, if at all, is not the determination of what the law shall  be, but merely the ascertainment of  the facts and circumstances upon which the application of said law is to be predicated. To promulgate rules and regulations on the use of national roads and to determine when and how long a national road should be closed to traffic, in view of the condition of the road or the traffic thereon and the requirements of   public convenience and interest, is an administrative function which cannot  be directly discharged by the  National Assembly.

Pursuant to the recommendation, and the powers conferred to it by Commonwealth Act No. 548, the Director of Public Works approved the recommendation, and the Mayor  of Manila and the Acting Chief of  Police of Manila started to enforce the said measures. As a consequence of the enforcement, all animal-drawn vehicles are not allowed to pass and  pick up passengers in the places mentioned—to the detriment not only of their owners but of the riding  public as well. CA No. 548 authorizes the Director  of Public Works, with the approval of the Secretary of Public Works a nd Communications, to promulgate rules and regulations for the regulation and control of the use of and traffic on national roads and streets.

W/N the rules and regulations  promulgated by the Director of  Public Works and the Secretary of  Public Works and Communications  pursuant to the powers conferred upon them by CA 548 constitute unlawful interference with legitimate  business or trade and abridge the right to personal liberty and freedom of locomotion.

 NO. Said Act aims to promote safe transit upon and avoid obstructions on national roads, in the interest and convenience of the public. In enacting said law, the National Assembly was prompted by considerations of public convenience and welfare. It was inspired by a desire to relieve congestion of traffic, which is, to say the least, a menace to  public safety. Public welfare, then, lies at the bottom of the e nactment of  said law, and the state in order to  promote the general welfare may interfere with personal liberty, with  property and with business and occupations. Persons and property may be subjected to all kinds of  restraints and burdens, in order to secure the general comfort, health, and prosperity of the state.

W/N the rules and regulations infringe upon the constitutional  precept regarding the promotion of  social justice.

 NO. Social justice must be founded on the recognition of the necessity of  interdependence among diverse units of a society and the protection that should be equally and evenly extended to all groups as a combined force in our social and economic life, consistent with the fundamental and  paramount objective of the state of   promoting the health, comfort, and

upon which the law makes, or intends to make, its own action depend. To deny this would stop the wheels of  government. There are many things upon which wise and useful legislation must depend which cannot  be known to the law-making power, and, must, therefore, be a subject of  inquiry and determination outside the halls of legislation. The paradox lies in the fact that the apparent curtailment of liberty is  precisely the very means of insuring its preservation. Social justice is neither communism, nor despotism, nor atomism, nor  anarchy, but the humanization of  laws and the equalization of social and economic forces by the State so that justice in its rational and objectively secular conception may at least be approximated. Social justice means the promotion of the welfare of all the people, the adoption by the Government of measures calculated to insure economic stability of all the competent elements of society, through the maintenance of a proper  economic and social equilibrium in the interrelations of the members of  the community, c onstitutionally, through the adoption of measures legally justifiable, or extraconstitutionally, through the exercise of powers underlying the existence of  all governments on the time-honored  principle of  salus  salus populi est suprema lex.

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Labor Standards Digest Matrix 1 – Stef Macapagal

AMA Computer College v. Rolando Austria GR No. 164078 23 November 2007  Nachura, J.

Rolando Austria was hired by AMA on probationary employment as a college dean, and was confirmed as such by AMA’s Officer-in-Charge of  Academic Affairs.

Whether Austria was a regular  employee, or an employee with a fixed term.

W/N Austria was lawfully dismissed. On the same month that he was confirmed, Austria was charged with violating AMA’s Employees’ Conduct and Discipline provided in its orientation handbook. He was then placed on preventive suspension, and was eventually dismissed. Austria filed an illegal dismissal complaint against AMA.

quiet of all persons, and of bringing about “the greatest good to the greatest number.” Austria was an employee with a FIXED TERM. The position of dean is normally an employment for a fixed term.  NO. True, AMA erred in dismissing Austria, acting on the mistaken belief  that he was liable for the charges leveled against him. But he cannot also claim entitlement to any benefit flowing from employment after 17 September 2000, because the employment, which is the source of  the benefits, had, by then, already ceased to exist.

When the findings of the National Labor Relations Commission contradict those of the Labor Arbiter, the Supreme Court, in the exercise of  its equity jurisdiction, may look into the records of the case and reexamine the questioned findings. The decisive determinant in term employment should not be the activities that the employee is called upon to perform, but the day certain agreed upon by the parties for the commencement and termination of  their employment relationship. A contract of employment for a definite period terminates on its own force at the end of such period. The lack of notice of termination is of no consequence because when the contract specifies the length of its duration, it comes to an end upon the expiration of such period.

Toyota Motors Phils. Corp. Workers Association v. NLRC GR Nos. 158786, 158789, and 158798-99 19 October 2007 Velasco, Jr., J.

Because of Toyota’s refusal to negotiate with the Union regarding the collective bargaining agreement, the Union staged a strike on February 2001 which became detrimental to Toyota’s business. As a result, Toyota terminated 227 employees. Outraged, the Union staged more strikes from March to April 2001, eventually barricading the entrance

W/N the mass actions committed by the Union on different occasions are illegal strikes.

While the Court adheres to the  principle of social justice and  protection to labor, the constitutional  policy to provide such protection to labor is not meant to be a n instrument to oppress employers. The commitment under the fundamental law is that the cause of labor does not  prevent us from sustaining the employer when the law is clearly on its side. Six categories of an illegal strike:

YES.

1.

Shrouded as demonstrations, they were in reality temporary stoppages of work   perpetrated through the concerted action of the employees who deliberately failed to report for work on the convenient excuse that

1.

When it is contrary to a specific prohibition specific prohibition of  law, such as strike by employees performing governmental functions;

2.

When it violates a specific requirement of law; law;

3.

When it is declared for an unlawful purpose unlawful purpose,, such as

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Labor Standards Digest Matrix 1 – Stef Macapagal

of Toyota’s two plants. Upon assumption of the DOLE Secretary of jurisdiction over the case, he directed that the status quo  be upheld and ordered the striking employees to return to work and f or  Toyota to have them reinstated. Despite the order, some reinstated workers still went on strike on May 2001.  NLRC subsequently declared that the strikes were illegal, that the dismissal of the 227 employees was legal, and forfeiting the employment status of  the reinstated employees for   participating in the subsequent strikes.

2.

3.

they will hold a rally at the BLR and DOLE offices. It becomes obvious that the real and ultimate goal of the Union is to coerce Toyota to finally acknowledge the Union as the sole  bargaining agent of the company. This is not a legal and valid exercise of  the right of assembly and to demand redress of  grievance. Moreover, the February 2001 concerted actions were undertaken without satisfying the  prerequisites for a valid strike under Art. 263 of  the Labor Code, which renders the strike illegal. With With respe respect ct to to the the March March and April 2001 strikes, however, they were initially legal as the legal requirements were met. But when Toyota’s plants were blocked, they  became illegal because unlawful means were employed. With respect to the May 2001 strikes, although there was no work  disruption in the two Toyota plants, the fact still remains that the Union and its members  picketed and performed concerted actions in front of the Company premises. This is a patent violation of the assumption of   jurisdiction and certification Order of the DOLE Secretary. While there are no work  stoppages, the pickets and concerted actions outside the plants have a

inducing the employer to commit an unfair labor   practice against non-union employees;

4.

When it employs unlawful means in the pursuit of its objective, such as a widespread terrorism of  non-strikers;

5.

When it is declared in violation of an existing injunction; injunction;

6.

When it is contrary to an existing agreement , such as a no-strike clause or  conclusive arbitration clause.

A strike means any temporary stoppage of work by the concerted action of employees as a result of an industrial or labor dispute. A labor dispute includes any controversy or matter concerning terms or 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 the employer and the employee. Once the DOLE Secretary assumes  jurisdiction over the labor dispute and certifies the case for compulsory arbitration with the NLRC, the  parties have to revert to the status the status quo ante. ante. The responsibility of union officials is greater than that of the members. They are tasked with the duty to lead and guide the membership in decision making on union activities in accordance with the law, government rules and regulations,

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Labor Standards Digest Matrix 1 – Stef Macapagal

demoralizing and even chilling effect on the workers inside the plants and can be considered as veiled threats of possible trouble to the workers when they go out of the company premises after  work and of impending disruption of operations to company officials and even to customers in the days to come. W/N separation pay should be awarded to the Union members who  participated in the illegal strikes.

 NO. The general rule is that when  just causes for terminating the services of an employee under Art. 282 of the Labor Code exist, the employee is not entitled to separation  pay. One exception where separation  pay is given even though an employee is validly dismissed is when the court finds justification in applying the principle of social  justice well entrenched in the 1987 Constitution. But this exception only applies when the employee is validly dismissed for causes other than serious misconduct, willful disobedience, gross and habitual neglect of duty, fraud or willful  breach of trust, commission of a crime against the employer or his family, or those reflecting his moral character. Since the dismissal of the workers was due to their   participation in the illegal strikes as well as violation of the Code of  Conduct of the company, the same constitutes serious misconduct. Obiter: While strikes and lockouts have been recognized as effective bargaining  tools, it is an antiquated notion that  they are truly beneficial, as they only  provide short-term solutions by  forcing concessions from one party; but staging strikes would damage the working relationship between

and established labor practices. The leaders are expected to recommend actions that are arrived at with circumspection and contemplation, and always keep paramount the best interests of the members and union within the bounds of law. Union officers are duty bound to guide their members to respect the law. If the officers urge the members to violate the law and defy the duly constituted authorities, their dismissal from the service is a just penalty or  sanction for their unlawful acts. An ordinary striking worker cannot  be terminated for mere participation in an illegal strike.  Rule of vicarious liability : Mere membership in a labor union serves as basis of liability for acts of  individuals, or for a labor activity, done on behalf of the union. The union member is made liable on the theory that all the members are engaged in a general conspiracy, and the unlawful acts of the particular  members are viewed as necessary incidents of the conspiracy. The Labor Code does not follow the vicarious liability rule. It is only when a striking worker “knowingly  participates in the commission of  illegal acts during a strike” that he will be penalized with dismissal. A serious misconduct is a transgression of some established and definite rule of action, a forbidden act, a dereliction of duty, willful in character, and implies wrongful intent and not mere error in  judgment. Obiter: Social justice cannot be permitted to be a refuge of scoundrels any more

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Labor Standards Digest Matrix 1 – Stef Macapagal

employers and employees, thus endangering the business that they both want to succeed. The more  progressive and truly effective means of dispute resolution lies in mediation, conciliation, and  arbitration, which do not increase tension but instead provide relief   from them.

Cebu Metal Corp. v. Gregorio Robert Saliling GR No. 154463 5 September 2006 Chico-Nazario, J.

Saliling and the others claimed to be regular workers for Cebu Metal Corp. Cebu Metal Corp. claims that these workers are only seasonal. When these workers demanded an increase in their salary, they were dismissed and were precluded from entering the compound of Cebu Metal Corp. Saliling and his companions then filed a case against Cebu Metal Corp. for underpayment of wages and non-payment of   benefits.

W/N the NLRC can rule on an issue which was NOT properly raised  before it.

 NO. The NLRC’s decision simply expressed an observation. It was  plain error for the CA to annul and set aside the decision of the NLRC on the lone reason that the latter  “dismissed Petitioner’s appeal on the  basis of an issue not raised by Private Respondent in its appeal.” A  painstaking review of the decision of  the NLRC will readily reveal that the Commission’s finding that respondent complainants were not regular employees was the raison d’etre for the subsequent turnaround of the state of affairs. And the use of  the word “moreover” clearly expresses NLRC’s position in treating the matter of the noninclusion of the issue of illegal dismissal in the complaint merely as an add-on, adjunct or a supplement to its finding that respondent complainants were not regular  employees of petitioner company.

W/N Murillo was a regular  employee.

YES. Murillo was a regular  employee under contemplation of  law. The assertion that a talent

The Labor Arbiter ruled that Saliling, et al. were regular company employees. Upon appeal, the NLRC reversed the decision, stating that the said workers were not regular  employees, thus could not be illegally dismissed. The CA then reversed the NLRC’s decision based on the ground that the NLRC gravely abused its discretion in ruling on an issue that was not raised on appeal  before it (Cebu Metal allegedly did not make an issue out of the Labor  Arbiter’s action in ruling on a cause of action—illegal dismissal was not specifically stated in the complaint).

than can equity be an impediment to the punishment of the guilty. Those who invoke social justice may do so only if their hands are clean and  their motives blameless and not   simply because they happen to be  poor. The constitutional guarantee on  social justice is not intended only for  the poor but for the rich as well. It is a policy of fairness to both labor and  management. An act of a court or tribunal may only  be considered to have been done in grave abuse of discretion when the same was performed in a capricious or whimsical exercise of judgment which is equivalent to lack of   jurisdiction. The abuse of discretion must be so patent and gross as to amount to an evasion of positive duty or to a virtual refusal to perform a duty enjoined or to act at a ll in contemplation of law, as where the  power is exercised in an arbitrary and despotic manner by reason of passion or personal hostility.

Characteristics of Employee-Employer Relationship Dumpit-Murillo v. CA GR No. 164652 8 June 2007

On 2 October 1995, Thelma DumpitMurillo was hired by Associated Broadcasting Company (ABC) as a

The practice of having fixed-term contracts in the industry does not automatically make all talent

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Quisumbing, J.

newscaster and co-anchor for   Balitang-Balita,  Balitang-Balita, an evening news  program. On 30 September 1999, after four years of repeated renewals, Murillo’s talent contract expired. She sent a letter to the Vice President for   News and Public Affairs of ABC, signifying her interest in renewing her contract subject to a salary increase. When she did not receive a reply, she demanded for  reinstatement to her former position,  payment of unpaid services from 1 September until 20 October 1999 and full backwages, and payment of other   benefits due to a regular employee starting 31 March 1996. ABC told her a check for her talent fee covering 16 September until 20 October 1999 had already been  processed, but answered that her  other claims had no basis in fact or in law. Murillo filed a claim with  NLRC. The labor arbiter dismissed her  complaint. Upon appeal, the NLRC reversed the labor arbiter, holding that an employer-employee relationship between the parties existed, and that Murillo was illegally dismissed. The NLRC also held that Murillo was entitled to reinstatement and backwages or  separation pay, aside from 13 th month  pay and service incentive leave pay, moral and exemplary damages, and attorney’s fees. The CA reversed the  NLRC decision on the ground that Murillo was a fixed-term employee, as was on her employment contract.

contract exists does not necessarily  prevent a regular employment status. In the case at bar, ABC had control over the performance of Murillo’s work. Moreover, Murillo’s duties as enumerated in her contract indicate that ABC had control over her work. Aside from control, ABC also dictated the work assignments and  payment of Murillo’s wages. ABC also had the power to dismiss her. All these being present, clearly, there existed an employment relationship  between Murillo and ABC. W/N Murillo was illegally dismissed.

YES. As a regular employee, Murillo is entitled to security of tenure and can be dismissed only for just ca use and after due compliance with  procedural due process. Since ABC did not observe due process in constructively dismissing Murillo, Murillo was illegally dismissed.

contracts valid and compliant with labor law. Elements of an employment relationship: 1. The The sel selec ecti tion on and and engagement of the employee; 2. The The pay payme ment nt of wage wages; s; 3. The The pow power er of dism dismis issal sal;; 4. Empl Employ oyer er’s ’s pow power er to to control. The most important element is the employer’s control of the employee’s conduct, not only as to the result of  the work to be done, but also as to the means and methods to accomplish it. Considering regular employment, the law provides for 2 kinds of  employees, namely: 1. Thos Thosee who who are engag engaged ed to  perform activities which are usually necessary or  desirable in the usual  business or trade of the employer; 2. Thos Thosee who who have have ren rende dere red d at least one year of  service, whether  continuous or broken, with respect to the activity in which they are employed. Regular status arises from either the nature of work of the employee or the duration of his employment.

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