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LABOR STANDARDS (Atty. Paulino Ungos)

DISCLAIMER: The Provisions used in this Code is based on the updated version of the Labor Code Codal, not on the Book of Atty. Paulino Ungos. This work is not intended to replace the book of Atty. Ungos, it merely highlights the important topics covered therein. Watch out for the stars  it is best to memorize this provision or paragraph.

PRESIDENTIAL DECREE NO. 442 PRELIMINARY TITLE Chapter I GENERAL PROVISIONS

ART. 1.  Name of Decree.  –  This Decree as the “Labor Code of the Philippines.”

shall be known

Effectivity.  –  This Code shall take effect ART. 2.  Date of Effectivity. six (6) months after its promulgation. PROMULGATION: May 1, 1974 EFFECTIVITY: November 1, 1974

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LIMITATION OF RULES AND REGULATIONS: It cannot enlarge or amend the provisions of the Labor Code.

ART. 6. Applicability.  –  All rights and benefits granted to workers under this Code shall, except as may otherwise be provided herein, apply alike to all workers, whether agricultural or non-agricultural. GENERAL RULE: It applies only to employees in the  Private Sector , whether agricultural or non -agricultural. A. With regard to normal working hours of work, meal periods, night-shift differential, overtime pay, weekly rest day, rest day and special day premium, regular holiday pay, service incentive leave and service charges, the exceptions are: 1) Government employees, including those employed in Government-Owned and Controlled Corporations;* 2) Managerial employees; 3) Members and employees of the managerial staff; 4) Field personnel; 5) Members of the family of the employer who are dependent on him for support; 6) Domestic helpers; 7) Persons in the personal service of another; and 8) Workers paid by results.

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 conditions of work.

B. With regard to the term “wages,” the exceptions are:

REASON: To raise the worker to equal footing with the employer. Hence, the construction of this Code in case of doubt, is in favour of labor. EXTENT OF PROTECTION: Not only against oppressive employers but also against unscrupulous union leaders. LIMITATIONS: a) Cannot be used to d efeat the rights of an employer.  b) Cannot be used as an excuse to distribution charities at the expense of an employer. c) Not available when both p arties have violated the law because neither party is entitled to protection.

C. With regard to retirement benefits, benefits, the exceptions are:

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 favour of labor. REASON: Those who have less in life should have more in law. APPLICABILITY: Applies only when there is a doubt. When there is no doubt, there is no room for interpretation.

ART. 5.  Rules and Regulations.  –  The Department of Labor and Employment (DOLE) and other Government agencies charged with the administration and enforcement of this Code or any of its parts shall promulgate the necessary implementing rules and regulations. Such rules and regulations shall become effective fifteen (15) days after announcement of their adoption in newspapers of general circulation. At least 2 newspapers (newspaperS nga eh)

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1) Those mentioned above; 2) Farm tenancy and leasehold; 3) Domestic service; 4) Persons working in their respective homes in needle work; and 5) Persons working in cottage industries. 1) Those enumerated in “A”; 2) Employees in retail and service establishments employing not more than 10 employees; and 3) Workers of agricultural establishments employing not more than 10 employees. *GOCC’s with special charter are under the Civil Service Law, hence they are not included. However, if the GOCC has a Special Charter  and  and is registered in the Securities and Exchange Commission (SEC), the employees thereof are covered by the Labor Code. To fall within the coverage of the Labor Code, it is essential that there be employer-employee relationship. relationship. ELEMENTS OF EMPLOYER-EMPLOYEE RELATIONSHIP:

(PWES!) a) Selection and Selection and Engagement   Engagement  of  of the employees;  b) Payment of Wages; Wages; c) Power  c) Power  of  of dismissal; and d) Power  d) Power  to  to control the employees conduct. Among the four elements, the power of control is the most important element that the other elements may even be disregarded.

When asked, what determines the existence of an employeremployee relationship, the answer is: - (MEANS and ENDS) That the employer has control over the  Means and the Ends the Ends.. In other words, the employer has control not only over the results for which the employee was hired for, but also the method how the results are to be attained.

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Does the employer-employee relationship exist in the following professions? -

-

-

-

-

INSURANCE AGENTS  –  If salaried, keep definite hours, and work under the control and supervision of the company, YES. If they are merely registered who work on commission  basis, NO. COLLECTION AGENTS  –  When the employer is only interested in the results and does not concern himself how the employee will get the results, NO. IN-HOUSE LAWYERS –  NO  NO PROFESSORS – YES WORKING SCHOLARS  –  If (a) there is a training agreement; and (b) the training program is duly accredited   by the proper government agency, agency, YES. CONSULTING OR VISITING PHYSICIANS  –  Generally,   Generally,  NO. But if the case case involves medical medical negligence, YES. YES. JEEPNEY DRIVERS or TAXI DRIVERS UNDER THE “BOUNDARY SYSTEM” – Yes. STEVEDORES OR ARRASTRE WORKERS  –  Between the shipping company and said workers, NO. But if said employees acted as agents of the shipping company, YES. SUGAR FARM WORKERS  –  Between the sugar central owner and the sugar planters, NO. GOLF CADDIES - NO

Cases where the Employer-Employee relationship is suspended: (MOLDS) 1) 2) 3) 4) 5)

Employee fulfils a Military a Military or Civic Civic duty; During Off-Season, Off-Season, in case of regular seasonal employees; When the employee is Laid-off  is  Laid-off  not  not exceeding 6 months;  Drydocked or  Drydocked or under repair fishing vessels; and When the employee is under Suspension; Suspension;

When is the E-E Relationship terminated? -

Dismissal of employee; Resignation of employee; Abandonment of employee of his duties; and Expiration of employment period.

What are the factors which do not interrupt E-E relationship? - Leave of absence with pay - Illegal dismissal - Strike HOW TO DETERMINE IF WHAT IS PAID IS WAGES: a) If paid in consideration of labor   being performed, the compensation is considered as “wages:”  b) If paid in consideration of the results or finished work , the compensation is not considered as wages.

Chapter II  EMANCIPATION OF TENANTS

Opinio non Juris: This part was not discussed by Atty. Ungos. I included this part simply because these are provisions of the law.

ART. 7. Statement of Objectives.  –  Inasmuch as the old concept of land ownership is concerned by a few has spawned valid and legitimate grievances that gave rise to violent conflict and social tension and the redress of such

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legitimate grievances being one of the fundamental objectives of the New Society, it has become imperative to start reformation with the emancipation of the tiller of the soil from his bondage. ART. 8. Transfer of Lands to Tenant-Workers.  –  Being a vital part of the labor force, tenant farmers on private agricultural lands primarily devoted to rice and corn under a system of share crop or lease tenancy whether classified as landed estate or not shall be deemed owner of a portion constituting a family size farm of five (5) hectares, if not irrigated an three (3) hectares, if irrigated. In all cases, the landowner may retain an area of not more than seven (7) hectares is such landowner is cultivating such area or will now cultivate it. ART. 9. Determination of Land Value.  –  For the purpose of determining the cost of the land to be transferred to the tenant-farmer, the value of the land shall be equivalent to two and one-half (2-1/2) times the average harvest of three (3) normal crop years immediately preceding the promulgation of Presidential Decree No. 27 on October 21, 1972. The total cost of the land, including interest at the rate  per annu annum m, shall be paid by the tenant in of six percent (6%) pe fifteen (15) years of fifteen (15) equal annual amortizations. In case of default, the amortization due shall be paid by the farmer’ cooperative in which the defaulting tenant farmer is a member, with the cooperative having a recourse against him. The government shall guaranty such amortizations with shares of stock in government-owned and governmentcontrolled corporations. Ownership.  —  No title to the ARTI. 10. Conditions of Ownership. land owned by the tenant-farmers shall be actually issued to a tenant-farmer unless and until the tenant has become a full fledged member of a duly recognized farmer's cooperative.

Title to the land acquired pursuant to Presidential Decree No. 27 or the Land Reform Program of the Government shall not be transferable except by hereditary succession or to the Government in accordance with the provisions of this Code, the Code of Agrarian Reforms and other existing laws and regulations. Agency.  —  The Department of ART. 11.  Implementing Agency. Agrarian Reforms shall promulgate the necessary rules and regulations to implement the provisions of this Chapter.

BOOK ONE  Pre-Employment  Objectives . — It is the policy of the ART. 12. Statement of Objectives. State: (a) To promote and maintain a state of full employment through improved manpower training, allocation and utilization. (b) To protect every citizen desiring to work locally or overseas by securing for him the best possible terms and conditions of employment; (c) To facilitate a free choice of available employment by persons seeking work in conformity with the national interest;

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(d) To facilitate and regulate the movement of w orkers in conformity with the national interest; (e) To regulate the employment of non-resident aliens; (f) To strengthen the network of public employment offices and to undertake the phasing out of private feecharging employment agencies; (g) To insure careful selection of Filipino workers for overseas employment in order to protect the good name of the Philippines abroad. TITLE I  Recruitment and Placing Placing of Workers

CHAPTER I General Provisions Terms.  —  (a) "Worker" means ART. 13.  Definition of Terms. any member of the labor force, whether employed or unemployed.   (b) "Recruitment "Recruitment and placement" refers refers to any any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, including referrals, contact services, promising employment or advertising for employment locally or abroad, whether for profit or not: Provided,   That whenever two or more persons are in any manner promised or offered employment for a fee, the individual or entity making such offer or promise shall be deemed engaged in recruitment and placement. (c) "Private fee-charging employment agency" means any person or entity engaged in recruitment and placement of workers for a fee which is charged, directly or indirectly, from the workers or employers or both. (d) "License" means a document issued by the Department of Labor authorizing a person or entity to operate a private employment agency. (e) “Private recruitment agency” means any person or association engaged in the recruitment and placement of workers, locally or overseas, without charging, directly or indirectly, any fee from the workers or employers. (f) “Authority” means a d ocument issued by the Department of Labor authorizing a person or association to engage in recruitment and placement activities as a private recruitment entity. (g) “Seaman” means any person employed in a vessel engaged in maritime navigation. (h) “Overseas employment” means employment of a worker outside the Philippines. (i) “Emigrant” means any person, worker or otherwise, who emigrates to a foreign country by virtue of an immigrant visa or resident permit or its equivalent. The phrase shall be deemed  merely creates a presumption that a person is engaged in recruitment and placement whenever he deals for a fee with two or more persons.

MIDTERMS: Read Darvin vs. CA (page 41) promotion.  —  The Secretary of ART. 14.  Employment promotion. Labor shall have the power and authority to: (a) To organize and establish new employment offices in addition to the existing employment offices under the Department of Labor as the need arises; (b) To organize and establish a nationwide job clearance and information system to inform applicants

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registering with a particular employment office of job opportunities in other parts of the country as well as job opportunities abroad; (c) To develop and organize programs that will facilitate occupational, industrial and geographical mobility or labor and provide assistance in the relocation of workers from one area to another; and (d) To require any person, establishment, organization or institution to submit such employment information as may be prescribed by the Secretary of Labor. ART. 15.  Power to Phase Out .  —  (a) The Bureau of Employment Services shall primarily be responsible for developing and monitoring a comprehensive employment program. It shall have the power and duty: 1. To formulate and develop plans and programs to implement the employment promotion objectives of this Title; 2. To establish and maintain a registration and/or licensing system to regulate private sector participation in the recruitment and placement of workers, locally and overseas, and to secure the best possible terms and conditions of employment for Filipino contract workers and compliance therewith under such rules and regulations as may be issued by the Minister of Labor; 3. To formulate and develop employment programs designed to benefit disadvantaged groups and communities; 4. To establish and maintain a registration and/or work permit system to regulate the employment of aliens; 5. To develop a labor market information system in aid of proper manpower and development planning; 6. To develop a responsive vocational guidance and testing system in aid of proper human resources allocation; and 7. To maintain a central registry of skills, except seamen. (b) The regional offices of the Ministry of Labor shall have the original and exclusive jurisdiction over all matters or cases involving employer-employee relations including money claims, arising out of or by virtue of any law or contracts involving Filipino workers for overseas employment except seamen: Provided, That the Bureau of Employment Services may, in the case of the National Capital Region, exercise such power, whenever the Minister of Labor deems it appropriate. The decision of the regional offices of the Bureau of Employment Services, if so authorized by the Minister of Labor as provided in this Article, shall be appealable to the National Labor Relations Commission upon the same grounds provided in Article 223 hereof. The decisions of the National Labor Relations Commission shall be final and inappealable. (c) The Minister of Labor shall have the power to impose and collect fees based on rates recommended by the Bureau of Employment Services. Such fees shall be deposited in the National Treasury as a special account of the General Fund, for the promotion of the objectives of the Bureau of Employment Services, subject to the provisions of Section 40 of Presidential Decree No. 117. SECTION 40.Special 40.Special Budgets for Lump-Sum  Appropriations.  Appropriations.  —   Expenditures from lump-sum appropriations authorized for any purpose or for any

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department, office or agency in any annual General Appropriations Act of other Act and from any fund of the National Government, shall be made in accordance with a special budget to be approved by the President, which shall include but shall not be limited to the number of each kind of position, the designations, and the annual salary proposed for which an appropriation is intended. This provision shall be applicable to all revolving funds, receipts which are automatically made available for expenditure for certain specific  purposes, aids and donations for carrying out certain activities, or deposits made to cover the cost of special services to be rendered to private parties. Unless otherwise expressly provided by law, when any Board, head of department, chief of bureau or office, or any other official, is authorized to appropriate, allot, distribute or spend any lump-sum appropriation or special, bond, trust, and other funds, such authority shall be subject to the provisions of this section. In case of any lump-sum appropriation for salaries and wages of temporary and emergency laborers and employees, including contractual  personnel, provided in any General Appropriation Act or other Acts, the expenditure of such appropriation shall be limited to the employment of persons paid by the month, by the day, or by the hour. E.O. 797 abolished the Bureau of Employment Services. In its stead, the Bureau of Local Employment (domestic functions) and the Philippine Overseas Employment Administration (overseas functions) were created.

 ART. 16.  Private Recruitment.  –   Except as provided in

Chapter II of this Title, no person or entity other than the public employment offices, shall engage in the recruitment and placement of workers. Q: Who are qualified to engage in recruitment and placement agencies? A: Generally, only public employment offices can engage in recruitment and placement of workers, whether for local or overseas employment. By way of exception, the private sector is given the privilege to engage in recruitment and placement, but limited to the following: (a) Private Employment Agency (PEA); (b) Private Recruitment Entity (PRE); (c) Shipping and Manning Agency (SMA); and (d) Such other persons or entities as may be authorized by the Secretary of Labor and Employment.

ART. 17 Overseas Employment Development Board .  —  An Overseas Employment Development Board is hereby created to undertake, in cooperation with relevant entities and agencies, a systematic program for overseas employment of Filipino workers in excess of domestic needs and to protect their rights to fair and equitable employment practices. It shall have the duty: 1. To promote the overseas employment of Filipino workers through a comprehensive market promotion and development program; 2. To secure the best possible terms and conditions of employment of Filipino contract workers on a governmentto-government basis and to ensure compliance therewith;

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3. To recruit and place workers for overseas employment on a government-to-government arrangement and in such other sectors as policy may dictate; and 4. To act as secretariat for the Board of Trustees of the Welfare Training Fund for Overseas Workers. As mentioned earlier, the Philippine Overseas Employment Administration (POEA) took over the functions of Overseas Employment Development Board. Overseas Employment  –   employment of a worker outside the Philippines under a valid contract Migrant Worker  –   a person who holds and overseas employment; applies to both land based workers and seafarers The POEA has the original and exclusive jurisdiction to hear and decide: (a) All cases which are administrative in character, involving or arising out of violations of recruitment laws, rules and regulations, including refund of fees collected from workers and violations of the conditions for the issuance of license to recruit landbased overseas workers or seafarers; and (b) Disciplinary action cases against migrant workers or seafarers, foreign employers and principals.

 MIDTERM Q: What is the RELIEF of a migrant worker? A: Double the claims plus 10% as attorney’s fees. Q: What is the REMEDY of a migrant worker who wants to bring action against his employer? A: File a complaint in POEA with the right to appeal to the Secretary of Labor Labor and Employment fifteen fifteen (15) days days from the receipt of the decision of the POEA.

Q: What are the Remedies of a locally or domestic employee? A: See Articles 128 and 129. Q: What if the issue was decided upon by a court in a foreign country? A: File a case in the courts of justice. Note: Differentiate a relief from a remedy. Remedies, According to Atty. Ungos, are the procedures which are available to the employee to assert any right granted to him by law, while Reliefs are the awards that may be granted to an aggrieved employee after the court finds fault against his employer.

 ART. 18.  Ban on Direct-Hiring. –  No   No employer may hire

a Filipino worker for overseas employment except through the Boards and entities authorized by the Secretary of Labor. Direct-hiring by members of the diplomatic corps, international organizations and such other employers as may be allowed by the Secretary of Labor is exempted from this provision. GENERAL RULE: No Filipino workers.

foreign  employer may directly   hire

EXCEPTIONS: (a) Members of dip lomatic corps; (b) International organizations; and

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LABOR STANDARDS (Atty. Paulino Ungos)

 Repealed by E.O. 797 ) ART. 23. ( Repealed

(c) Other employers who may be allowed by the Secretary to directly hire their workers.

 Repealed by E.O. 247 ) ART. 24. ( Repealed

 Name Hire  –   a worker who is able to secure an overseas employment on his own without the assistance or participation of any agency.

ART. 19. (Superseded by B.P. Blg. 79 or the Commission on Filipino Overseas) Overseas) ART. 20. (Superseded by E.O. 797or An Act Reorganizing the Ministry of Labor and Employment, creating the Philippine Overseas Employment Administration, and for other purposes) purposes) ART. 21.  Foreign Service Role and Participation.  –  To provide ample protection to Filipino workers abroad, the labor attaches, the labor reporting officers duly designated by the Secretary of Labor and the Philippine diplomatic or consular officials concerned shall, even without prior instruction or advice from the home office, exercise the power and duty: (a) To provide all Filipino workers within their  jurisdiction assistance on all matters arising out of employment; (b) To insure that Filipino workers are not exploited or discriminated against; (c) To verify and certify as requisite to authentication that the terms and conditions of employment in contracts involving Filipino workers are in accordance with the Labor Code and rules and regulations of the Overseas Employment Development Board and National Seamen Board; (d) To make continuing studies or researches and recommendations on the various aspects of the employment market within their jurisdiction; (e) To gather and analyze information on the employment situation and its probable trends, and to make such information available; and (f) To perform such other duties as may be required of them from time to time.  ART. 22.  Mandatory Remittance of Foreign Exchange

shall be mandatory for all Filipino workers abroad to remit a portion of their foreign exchange earnings to their families, dependents, and/or beneficiaries in the country in accordance with rules and regulations prescribed by the Secretary of Labor and Employment.

CHAPTER II  Regulation of Recruitment Recruitment and Placement Placement Activities

ART. 25.  Private S ector Participation in the Recruitment and Placement of Workers. Workers .  —   Pursuant to national development objectives and in order to harness and maximize the use of private sector resources and initiative in the development and implementation of a comprehensive employment program, the private employment sector shall participate in the recruitment and placement of workers, locally and overseas, under such guidelines, rules and regulations as may be issued by the Secretary of Labor. Recruitment and Placement of Employees for Local Employment. A private recruitment and placement agency for local employment can engage in recruitment and placement only under the following conditions: (a) It must have a license to operate   as a recruitment and  placement agency; agency; and (b) It must have an authority to engage in recruitment activities activities in a particular region. Apart from the license, a private employment agency for local employment is obliged to secure an authority to recruit workers within a particular region.

Recruitment and Placement of Employees for Overseas Employment. A. For Land-Based Overseas Employment (a) It should have a license to operate ; and (b) It should recruit and place workers only for and accredited principals  by the POEA.

EXCEPTIONS TO THE REMITTANCE: a) Immediate family members, dependents and beneficiaries are residing with him abroad;  b) Filipino servicemen working in U.S. military installations; and c) Immigrants and Filipino professionals and employees working with the United Nations agencies.

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registered

B. For Overseas Maritime Employment (a) It should have a license to operate ; and (b) It should recruit and place workers only for and accredited principals  by the POEA. (c) The vessels are enrolled with the POEA.

 Earnings.  —  It   It

80% of basic salary –  salary –  seamen  seamen and mariners; 70% - workers of Filipino contractors and construction companies; 70% - do ctors, engineers, teachers, nurses and other professional workers whose employment contracts provide for free  board and lodging facilities; facilities; 50% - other professionals whose employment contracts do not  provide for free board and lodging; 50% - domestic helpers and other service workers; and 50% - other workers not falling under the aforementioned categories.

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registered

Duration of License: Provisional License –  License –  One  One (1) year Private Employment Agency –  Agency  –  Two   Two (2) years starting from the date of issuance and valid all over the Philippines. Foreign Private Employment Agency –  Agency –  Four  Four (years) years.

Renewal of License: -

Must be renewed within thirty (30) days before its expiration. It must be renewed on or b efore it expiration. Renewal of license will not be allowed if: (a) The agency has been been convicted by the regular courts for violation of the Labor Code; or (b) The agency’s license has been previously revoked.

PROVISIONAL LICENSE  –  is a permit issued to a new recruitment or manning agency for a limited period of one (1) year, within which the period, the agency shall comply with its undertaking to deploy one hundred land-based workers or fifty seafarers to its new market. Non compliance will result in expiration of the provisional license .

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LABOR STANDARDS (Atty. Paulino Ungos)

Advertisement for Overseas Jobs. A. For Actual Job Vacancies  –  Licensed employment or manning agencies may advertise for actual job vacancies without prior approval from the POEA, if covered by manpower requests by registered/accredited foreign principals and projects.

B. For Manpower Pooling  –  Licensed employment agencies may advertise for manpower pooling without prior approval from the POEA under the following conditions: (a) The advertisement should indicate in bold letters that it is for manpower pooling only and that no fees will be collected; and (b) The advertisement indicates the name, address and POEA license number of the agency, name of worksite of the  prospective registered/accredited principal and skill categories and qualification standards, in case of land-based workers; or the name, address and POEA license number of the agency, name of the ship and skill categories and qualificiation standards, in case of seafarers.

Period to Deploy an Overseas Worker or Seafarer Within sixty (60) days from the date of issuance of the overseas employment certificate.

Minimum Provisions for Employment Contracts of LandBased Workers (a) (b) (c) (d) (e)

Guaranteed Wages whichever is highest;* Free transportation to and from worksite; Free food and accommodation, or offsetting benefit; Just/authorized causes for termination of the contract; Other matters to be considered by the POEA.

*Highest of the following: a) Minimum wage in host country  b) Minimum wage according to a bilateral agreement of international convention; or c) Minimum wage in the Philippines

Repatriation of Workers and Seafarers Gen. Rule: The repatriation of land-based workers or seafarers and the transport of their personal belongings shall be the  primary responsibility of the agency which recruited or deployed the worker or seafarer. All costs attendant to r epatriation shall be  borne by the principal or agency concerned including the repatriation of the remains and transport of the personal  belongings of the deceased worker or seafarer and all costs attendant thereto.

Exception: If the termination of the employment is due to the fault of the worker or seafarer, the principal or agency shall not in any manner be responsible for h is repatriation. Without prior determination of the cause of termination of the employment, the principal or agency shall advance the cost of the plane fare. If it is later found that the termination is due to the worker’s or seafarer’s fault, the principal or agency may recover the cost of repatriation.

Solidary Liability of Recruitment or Manning Agency The recruitment agency and foreign employer shall assume joint and solidary liability for all claims and liabilities which may arise in connection with the implementation of the contract, including but not limited to payment of wages, death and disability compensation and repatriations.

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Exceptions: a) Workers themselves were the ones who persuaded the agency to send them back abroad despite their knowledge that the foreign employer might not be able to p ay their wages;  b) When the workers were recruited by the supposed agency without the latter’s consent.

Read: Feagle Const. Corp. vs. Gayda (page118) ART. 26. Travel Agencies Prohibited to Recruit . —  Travel agencies and sales agencies of airline companies are prohibited from engaging in the business of recruitment and placement of workers for overseas employment whether for profit or not. Persons Disqualified Recruitment:

From

Engaging

in

Overseas

(a) Travel agencies; (b) Sales agencies of airline companies; (c) Officers or members of the Board of any corporation or members of a partnership engaged as a travel agency; (d) Persons, partnerships or corporations which have: (i) Derogatory records with the NBI, POEA; (ii) Probable cause or prima facie evidence against them for illegal recruitment; (iii) Been convicted of illegal recruitment or crimes involving moral turpitude; and (iv) Their licenses revoked or cancelled. (e) Any officer or employee of the DOLE, POEA, OWWA, DFA, or other government agencies directly involved in the implementation of R.A. No. 8042 or P.D. 442. (f) Relatives within the fourth degree of consanguinity or affinity of those officers mentioned in the preceding number; and (g) Persons, parthers, officers and directors or corporations whose license has been revoked or cancelled for violation of recruitment laws.

 ART. 27. Citizenship Requirement . —  Only Filipino

citizens or corporations, partnerships or entities at least sevent-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. 28. Capitalization. —  All applicants for authority

to hire or renewal of license to recruit are required to have substantial capitalization as determined by the Secretary of Labor. Single Proprietor or Partnership (Minimum Net Worth) Corporation (Paid-up Capital)

LOCAL

OVERSEAS

P200,000

P2,000,000

P500,000

P2,000,000

 ART. 29.  Non-transferability of License or Authority.  — 

No license or authority shall be used directly or indirectly by any person other than the one in whose favor it w as issued at any place other than that stated in the license or authority be transferred, conveyed or assigned to any other person or entity. Any transfer of business address, appointment or Page 6

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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.

 been garnished, the agency shall replenish the same. Failure to replenish shall cause the suspension of the license.

Note:

applying with a private fee-charging employment agency for employment assistance shall not be charged any fee until he has obtained employment through its efforts until he has obtained employment through its efforts or has actually commenced employment. Such fee shall be always covered with the appropriate receipt clearly showing the amount paid. The Secretary of Labor shall promulgate a schedule of allowable fees.

- Cannot be used by those other than those in whose favour it was issued - Cannot be used at any place other than those stated - Cannot be transferred, conveyed or assigned - Any changes in the information in the license must be subject to the approval of the Department of Labor

Effects to the license

 ART. 32.  Fees to be Paid by Workers.  –   Any person

Revoke –  Death of a sole p roprietor Surrender –  Change of ownership of local recruitment agency Revoke - Change of ownership of overseas recruitment agency Revoke –  Dissolution of partnership Revoke –  Upgrading from single proprietorship or partnership to corporation

Placement fees on workers:

ART. 30.  Registration Fees.  –   The Secretary of Labor shall promulgate a schedule of fees for the registration of all applicants for license or authority.

Service Fee

Note: Local –  P5,000 Overseas –  P50,000

 ART. 31. Bond . —  Any applicant for license or authority

shall post such cash and surety bonds as determined by the Secretary of Labor to guarantee compliance with the prescribed recruitment procedures, rules and regulations, and terms and conditions of employment as may be appropriate.

LOCAL - not to exceed 20% of the worker’s first month’s basic salary OVERSEAS  –   equivalent to one month salary unless the host country does not allow charging of placement fees LOCAL – not to exceed 20% of the worker’s ann ual salary OVERSEAS –  chargeable against the principal

ART. 33. Reports on Employment Status.  –  Whenever the public interest requires, the Secretary of Labor may direct all persons or entities within the coverage of this Title to submit a report on the status of employment, including job vacancies, details of job requisitions, separation from jobs, wages, other terms and conditions and other employment data.

As soon as an Order or Notice of Garnishment is served upon the Bank, the deposit in escrow shall no longer be considered sufficient. The POEA shall then serve the recruitment or manning agency to replenish its escrow deposit. Within 15 days from date of receipt of notice from the POEA that the bonds or deposit in escrow, or any part of it had

ART. 34. 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 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 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; (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

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Company posting the bond is still liable even if it is not included as a party in the complaint.

Amount of Bond LOCAL EMPLOYMENT: Cash Bond –  P25,000 Surety Bond –  P100,000 OVERSEAS EMPLOYMENT Escrow Deposit –  P1,000,000 Surety Bond –  P100,000

Appeal Bond The bond required under Article 31 is different from the bond required under Article 223 of the Labor Code. The bond under the latter is a requirement for the perfection of an appeal. The former is intended to insure the payment of monetary award in the event that the judgment is affirmed on appeal.

Garnishment of Bonds The bond under Article 31 is intended to answer only employment-related claims and violations of labor laws. Therefore, it cannot be garnished to satisfy a claim against a recruitment agency that is not employment-related or does not  pertain to violations of labor laws.

Effect of a Valid Garnishment

LABOR STANDARDS (Atty. Paulino Ungos)

time of actual signing thereof by the parties up to and including the period of expiration of the same without the approval of the Secretary of Labor; (j) To become 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; (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. 35. Suspension and/or Cancellation of License or  Authority.  —   The Minister of Labor shall have the power to suspend or cancel any license or authority to recruit employees for overseas employment for violation of rules and regulations issued by the Minister of Labor, the Overseas Employment Development Board, or for violations of the provisions of this and other applicable laws, General Orders and Letters of Instructions. CHAPTER III  Miscellaneous Provisions

ART. 36.  Regulatory Powers.  — 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. ART. 37. Visitorial Power.  –   The Secretary of Labor or his duly authorized representatives may, at any ti me, 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. 38.  Illegale Recruiment .  —   (a) Any recruitment activities, including the prohibited practices enumerated under Article 34 of this Code, to be undertaken by nonlicensees or non-holders of authority, shall be deemed illegal and punishable under Article 39 of this Code. The Department of Labor and Employment or any law enforcement officer may initiate complaints under this Article. (b) Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense involving economic sabotage and shall be penalized in accordance with Article 39 hereof. Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring and/or confederating with one another in carrying out any unlawful or illegal transaction, enterprise or scheme defined under the first paragraph hereof. Illegal recruitment is deemed committed in large scale if committed against three (3) or more persons individually or as a group. (c) (declared unconstitutional ) Two types of illegal recruitment: (a) The offender is not a holder of a license or authority and engages in recruitment activities; or (b) The offender is licensed and is engaged in recruitment activities and has committed any prohibited practices under Article 34 of the Labor Code or those enumerated in Section 6 of the Migrant Workers Act.

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Qualified Illegal Recruitment: (a) Committed by a syndicate  –   carried out by a group of three (3) or more persons conspiring or confederating with one another in carrying out any illegal or unlawful recruitment activity; or (b) Committed in large scale  –  committed against three or more  persons, individually or as a group. Qualified illegal recruitment is considered an offense involving economic sabotage.

Illegal Recruitment and Estafa A person who violates any of the provisions under Article 13(b) and Article 34 of the Labor Code can be charged and convicted separately of illegal recruitment and estafa because illegal recruitment is a malum prohibitum where criminal intent is not necessary for conviction, while estafa is a malum in se where criminal intent is necessary for conviction.

Prescription of Action 3 years –  Illegal recruitment cases under the Labor Code 5 years  –   Illegal recruitment cases covered by the Migrant Workers Act 20 years –  Cases involving economic sabotage

ART. 39.  Penalties.  - (a) The penalty of life imprisonment and a fine of One Hundred Thousand Pesos (P1000,000.00) shall be imposed if illegal recruitment constitutes economic sabotage as defined herein; (b) Any licensee or holder of authority found violating or causing another to violate any provision of this Title or its implementing rules and regulations shall, upon conviction thereof, suffer the penalty of imprisonment of not less than two years nor more than five years or a fine of not less than P10,000 nor more than P50,000, or both such imprisonment and fine, at the discretion of the court; (c) Any person who is neither a licensee nor a holder of authority under this Title found violating any provision thereof or its implementing rules and regulations shall, upon conviction thereof, suffer the penalty of imprisonment of not less than four years nor more than eight years or a fine of not less than P20,000 nor more than P100,000 or both such imprisonment and fine, at the discretion of the court; (d) 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; and if such officer is an alien, he shall, in addition to the penalties herein prescribed, be deported without further proceedings; (e) 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. Republic Act No. 8042 SECTION 7. Penalties. —  (a)Any person found guilty of illegal recruitment shall suffer the penalty of imprisonment of not less than six (6) years and one (1) day but not more than twelve (12) years and a fine of not less than Two

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hundred thousand pesos (P200,000.00) nor more than Five hundred thousand pesos (P500,000.00).

activity in a state of which he or she is not a legal resident; to be used interchangeably with overseas Filipino worker.

(b)The penalty of life imprisonment and a fine of not less than Five hundred thousand pesos (P500,000.00) nor more than One million pesos (P1,000,000.00) shall be imposed if illegal recruitment constitutes economic sabotage as defined herein.

SEC. 6 ILLEGAL RECRUITMENT   (under Migrant

 Provided, however , That the maximum penalty shall be imposed if the person illegally recruited is less than eighteen (18) years of age or committed by a nonlicensee or non-holder of authority.

Notes: Penalties involving local employment: Article 39 Penalties involving overseas employment: R.A. 8042

Article 39

Economic Sabotage

Illegal Recruitment

Committed by a juridical person

Effects

Imprisonment: - Life Fine: - P100,000

R.A. 8042 (Sec. 6) Imprisonment: - Life Fine: P500,000 to P1,000,000

Licensed: Imprisonment: - 2-5 years Fine: Imprisonment: - P10,000 to - 6-12 years P50,000 Fine: Unlicensed: P200,000 to Imprisonment: P500,000 - 4-8 years Fine: - P20,000 to P100,000 Local Corp: Imposed upon the officer responsible for the violation Alien/Foreign: Imposed upon the officer responsible for the violation with deportation - Revocation of - If the person license or illegally authority recruited is - Forfeiture of cash less than 18 and surety bonds years of age, maximum  penalty - Committed by a non-license or non-holder of authority, maximum  penalty

IMPORTANT PROVISIONS OF THE MIGRANT WORKERS ACT: SEC. 3(a). MIGRANT WORKER  –  a person who is to be engaged, is engaged or has been engaged in a remunerated

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Workers Act)  –   any act of canvassing, enlisting, contracting, transporting, utilizing, hiring, procuring workers and includes referring, contact services, promising or advertising for employment abroad, whether for pro fit or not, when undertaken by a non-license 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. Provided, that such nonlicense or non-holder, who, in any manner, offers or  promises for a fee employment abroad to two or more  persons shall be deemed so engaged.

SEC. 10. MONEY CLAIMS  - claims arising out of an employer-employee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment including claims for actual, moral, exemplary and other forms of damages.

SEC. 23. ROLE OF GOVERNMENT AGENCIES  - The following government agencies shall perform the following to  promote the welfare and protect the rights of migrant workers and, as far as applicable, all overseas Filipinos: (a) Department of Foreign Affairs.  - The Department, through its home office or foreign posts, shall take priority action its home office or foreign posts, shall take priority action or make representation with the foreign authority concerned to protect the rights of migrant workers and other overseas Filipinos and extend immediate assistance including the repatriation of distressed or beleaguered migrant workers and other overseas Filipinos; (b) Department of Labor and Employment - The Department of Labor and Employment shall see to it that labor and social welfare laws in the foreign countries are fairly applied to migrant workers and whenever applicable, to other overseas Filipinos including the grant of legal assistance and the referral to proper medical centers or hospitals: (b.1) Philippine Overseas Employment Administration Subject to deregulation and phase out as provided under Sections 29 and 30 herein, the Administration shall regulate  private sector participation in the recruitment and overseas  placement of workers b y setting up a licensing and registration system. It shall also formulate and implement, in coordination with appropriate entities concerned, when necessary employment of Filipino workers taking into consideration their welfare and the domestic manpower requirements. (b.2) Overseas Workers Welfare Administration   - The Welfare Officer or in his absence, the coordinating officer shall  provide the Filipino migrant worker and his family all the assistance they may need in the enforcement of contractual obligations by agencies or entities and/or by their principals. In the performance of this functions, he shall make representation and may call on the agencies or entities concerned to conferences or conciliation meetings for the purpose of settling the complaints or problems brought to his attention.

SEC. 28. COUNTRY-TEAM APPROACH  - Under the country-team approach, all officers, representatives and  personnel of the Philippine government posted abroad regardless of their mother agencies shall, on a per country basis, act as one

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country-team with a mission under the leadership of the ambassador. In this regard, the ambassador may recommend to the Secretary of the Department of Foreign Affairs the recall of officers, representatives and personnel of the Philippine government posted abroad for acts inimical to the national interest such as, but not limited to, failure to provide the necessary services to protect the rights of overseas Filipinos. Upon receipt of the recommendation of the ambassador, the Secretary of the Department of Foreign Affairs shall, in the case of officers, representatives and personnel of other departments, endorse such recommendation to the department secretary concerned for appropriate action. Pending investigation by an appropriate body in the Philippines, the person recommended for recall may be placed under preventive suspension by the ambassador. In host countries where there are Philippine consulates, such consulates shall also constitute part of the country-team under the leadership of the ambassador.

TITLE II  Employment of Non-Resident Aliens

ART. 40.  Employment permit for non-resident aliens.  —  Any alien seeking admission to the Philippines for employment purposes and any domestic or fo reign employer who desires to engage an alien for employment in the Philippines shall obtain an employment permit from the Department of Labor. The employment permit may be issued to a non-resident alien or to the applicant employer after a determination of the non-availability of a person in the Philippines who is competent, able and willing at the time of application to perform the services for which the alien is desired. For an enterprise registered in preferred areas of investments, said employment permit may be issued upon recommendation of the government agency charged with the supervision of said registered enterprise. Q: Who are required to obtain employment permit? A:  Non- resident aliens seeking admission in the Ph ilippines for employment and any domestic of foreign employer who desires to engage and alien for employment.

Q: What is the minimum age of employment: A: For apprenticeship or learners, 15 years old. For overseas employment, not less than 18 years of age.

Q: What are the grounds for the cancellation of Alien Employment Permit? A: (a) Non-compliance with the conditions of the permit; (b) Misrepresentation of facts in the application; (c) Submission of falsified or tampered documents; (d) Meritorious objection or information against the employment of the foreign national; (e) Foreign national has a derogatory record; and (f) Employer terminated his employment.

Remedies in Case of Suspension, Cancellation or Revocation of Alien Employment Permit File a Motion for Reconsideration within seven (7) calendar days from the receipt o f Suspension, Cancellation or Revocation order with the Regional Director.

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After the lapse of seven calendar days and before ten days, the action is considered to be for an appeal. File an appeal with the Secretary of Labor within ten (10) calendar days from receipt of such Order. The decision of the Secretary of Labor is final and unappealable unless there is an abuse of discretion amounting to lack or excess of jurisdiction.

ART. 41.  Prohibition Against Transfer of Employment.  —  (a) After the issuance of an employment permit, the alien shall not transfer to another job or change his employer without prior approval of the Secretary of Labor. (b) Any non-resident alien who shall take up employment in violation of the provision of this Title and its implementing rules and regulations shall be punished in accordance with the provisions of Articles 289 and 290 of the Labor Code. In addition, the alien worker shall be subject to deportation after the service of his sentence. ART. 289. Closur of Establishment and  Reduction of Personnel.  –  The employer may also terminate the employment of any employee due to the installation of labor-saving devices, redundancy, retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the closing is for the purpose of circumventing the provisions of this Title, by serving a written notice on the workers and the Miniter of Labor and Employment at least one (1) month before the intended date thereof. In case of termination due to the installation of labor-saving devices or redundancy, the worker affected thereby shall be entitled to a separation pay equivalent to at least one (1) month pay or to at least one (1) month pay for every year of service, which is higher. In case of retrenchment to  prevent losses in cases of closures or cessation of operations of establishment or undertaking not due to serious business losses or financial reverses, the separation pay shall be equivalent to one (1) month  pay or atleast one-half (1/2) month pay for every year of service, whichever is higher. A fraction of at least six (6) months shall be considered one (1 ) whole year. ART. 290.  Disease as Grounds for Termination.

 –  An employer may terminate the services of an employee who has been foun to be suffering from any disease and whose continued employment is  prohibited by law or is prejudicial to his health as well as to the health of his co-employees:  Provided , That he has paid separation pay equivalent to at least one (1) month salary or to one-half (1/2) month salary for every year of service, whichever is greater, a fraction of at least six (6) months being considered as one (1) whole year.

ART. 42. Submission of List . —  Any employer employing non-resident foreign nationals on the effective date of this Code shall submit a list of such nationals to the Secretary of Labor within thirty (30) days after such date indicating their names, citizenship, foreign and local addresses, nature of employment and status of stay in the country. The Secretary of Labor shall then determine if they are entitled to an employment permit. Page 10

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BOOK TWO  Human Resources Development 

TITLE I  National Manpower Development Program

CHAPTER I  National Policies and Administrative Machinery for their  Implementation

NOTE: Articles 43 to 56 (Superseded by R.A. No. 7796 or Technical Educational and Skills Development (TESDA) Act of 1994)

DUAL TRAINING SYSTEM  –  is an instructional delivery system of technical and vocational education and training that combines in-plant training and in-school training.

TITLE II Training and Employment of Special Workers

CHAPTER I  Apprenticeship

ART. 57. Statement of Objective. —  This Title aims: (1) To help meet the demand of the economy for trained manpower. (2) To establish a national apprenticeship program through the participation of employers, workers, and government and non-government agencies. (3) To establish apprenticeship standards for the protection of apprentices.  ART. 58. Definition of Terms. —  As used in this Title:

(a) "Apprenticeship" means practical training on the  job supplemented by related theoretical instruction. (b) An "apprentice" is a worker who is covered by a written apprenticeship agreement with an individual employer or any of the entities recognized under this Chapter. (c) An "apprenticeable occupation" means any trade, form of employment or occupation which requires more than three (3) months of practical training on the job supplemented by related theoretical instruction. (d) "Apprenticeship agreement" is an employment contract wherein the employer binds himself to train the apprentice and the apprentice in turn accepts the terms of training. REQUISITES: 1) 2)

A highly technical industry; and Approved apprenticeable occupation.

PERIOD:  Not less than 3 months but not more than 6 months

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REQUISITES: (a) At least 14 years of age; (b) Possess vocational aptitude and capacity for approp riate test; (c) Posses the ability to comprehend and follow oral and written instructions; and (d) Physically fit

ART. 60. Employment of Apprentices.  —  Only employers in the highly technical industries may employ apprentices and only in apprenticeable occupations approved by the Secretary of Labor and Employment. REQUISITES FOR APPRENTICE EMPLOYMENT: 1) The employer should be engaged  in a business that is considered a highly technical industry ; 2) The job to which the apprentice will work on should be classified as and apprenticeable occupation .

ART. 61. Contents of Apprenticeship Agreements.  —  Apprenticeship agreements including wage rates of apprentices, shall conform to the rules issued by the Secretary of Labor and Employment. The period of apprenticeship shall not exceed 6 months. Apprenticeship agreements providing for wage rates below the legal minimum wage, which in no case shall start below 75 percent of the applicable minimum wage, may be entered into only in accordance with apprenticeship programs duly approved by the Secretary of Labor and Employment. The Department shall develop standard model programs of apprenticeship. Q: What is the minimum compensation for apprentices? A: Not less than 75% of the statutory minimum wage. However, the employer may pay for a higher wage.

GROUNDS FOR TERMINATION OF APPRENTICE PROGRAM BY THE EMPLOYER: (P 2HWET) 1) Poor efficiency; 2) Poor physical condition; 3) Habitual absenteeism; 4) Willful disobedience; 5) Engaging in violence; and 6) Theft

GROUNDS FOR TERMINATION OF APPRENTICE PROGRAM BY THE APPRENTICE: (Bull Shit ang Revised Penal Code) 1) Bad health or continuing illness; 2) Substandard working conditions; 3) Repeated violations of the apprenticeship agreement by the employer; 4) Personal problems which will prevent performance; 5) Cruel and inhuman treatment.

ART. 59. Qualifications of Apprentice.  —   To qualify as an apprentice, a person shall: (a) Be at least fourteen (14) years of age; (b) Possess vocational aptitude and capacity for appropriate tests; and (c) Possess the ability to comprehend and follow oral and written instructions. Trade and industry associations may recommend to the Secretary of Labor appropriate educational requirements for different occupations.

ART. 62. Signing of Apprenticeship Agreement .  —   Every apprenticeship agreement shall be signed by the employer or his agent, or by an authorized representative of any of the recognized organizations, associations or groups, and by the apprentice. An apprenticeship agreement with a minor shall be signed in his behalf by his parent or guardian or, if the latter is not available, by an authorized representative of the Department of Labor, and the same shall be binding during its lifetime. Every apprenticeship agreement entered into under this Title shall be ratified by the appropriate apprenticeship

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committees if any, and a copy thereof shall be furnished both the employer and the apprentice. ART. 63. Venue of Apprenticeship Programs.  —  Any firm, employer group of association, industry organization or civic group wishing to organize an apprenticeship program may choose from any of the following apprenticeship schemes as the training venue for apprentices: (a) Apprenticeship conducted entirely by and within the sponsoring firm, establishment or entity; (b) Apprenticeship entirely within a Department of Labor training center or other public training institution; or (c) Initial training in trade fundamentals in a training center or other institution with subsequent actual work participation within the sponsoring firm or entity during the final stage of training. ART. 64. Sponsoring of Apprenticeship Program.  —  Any of the apprenticeship schemes recognized herein may be undertaken or sponsored by a single employer or firm or by a group or association thereof, or by a civic organization. Actual training of apprentices may be undertaken: (a) In the premises of the sponsoring employer in the case of individual apprenticeship programs; (b) In the premises of one or several designated firms in the case of programs sponsored by a group or association of employers or by a civic organization; or (c) In a Department of Labor training center or other public training institution. ART. 65.  Investigation of Violation of Apprenticeship  Agreement .  —   Upon complaint of any interested person or upon its own initiative, the appropriate agency of the Department of Labor or its authorized representative shall investigate any violation of an apprenticeship agreement pursuant to such rules and regulations as may be prescribed by the Secretary of Labor and Employment. ART. 66.  Appeal to the Secretary of Labor .  —   The decision of the authorized agency of the Department of Labor and Employment may be appealed by any aggrieved person to the Secretary of Labor within five (5) days from receipt of the decision. The decision of the Secretary of Labor shall be final and executory. Note: Appeal for illegal recruitment (7 calendar days); Appeal for violation of apprenticeship agreement (5 calendar days). Though the Code states that the decision of the Secretary shall  be final and executor, aggrieved party may elevate the matter in court by way of Petition for Certiorari to the Supreme Court for issues involving grave abuse of discretion amounting to lack or abuse of jurisdiction. According to Rule 43 Section 2 of the Rules of Court which states: “This Rule shall not apply to  judgments or final orders issued under the Labor Code of the Philip pines.”

ART. 67.  Exhaustion of Administrative Remedies.  —  No person shall institute action for the enforcement of any apprenticeship agreement, or damages for breach of any such agreement, unless he has exhausted all available administrative remedies.

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required under this Chapter, employers or entities with duly approved apprenticeship programs shall have primary responsibility for providing appropriate aptitude tests in the selection of apprentices. If they do not have adequate facilities for the purpose, the Department of Labor and Employment shall perform the service free of charge. ART. 69.  Responsibility for Theoretical Instruction.  —  Supplementary theoretical instruction to apprentices in cases where the program is undertaken in the plant may be done by the employer. If the latter is not prepared to assume the responsibility, the same may be delegated to an appropriate government agency. RATIO: 100 hours of theoretical instructions for every 2,000 hours of practical or on-the-job training.

ART. 70. Voluntary Organization of Apprenticeship  Programs;  Exceptions.  —   (a) The organization of apprenticeship programs shall be primarily a voluntary undertaking of employers; (b) When national security or particular requirements of economic development so demand, the President of the Philippines may require compulsory training of apprentices in certain trades, occupations, jobs or employment levels where shortage of trained manpower is deemed critical as determined by the Secretary of Labor and Employment. Appropriate rules in this connection shall be promulgated by the Secretary of Labor and Employment as the need arises; and (c) Where services of foreign technicians are utilized by private companies in apprenticeable trades, said companies are required to set up appropriate apprenticeship programs. ART. 71.  Deductibility of Training Costs.  —  An additional deduction from taxable income of one-half (1/2) of the value of labor training expenses incurred for developing the productivity and efficiency of apprentices shall be granted to the person or enterprise organizing an apprenticeship program: Provided , That such program is duly recognized by the Department of Labor and Employment; Pr ovided F urther,   That such deduction shall not exceed 10% of direct labor wage; and Pr ovided F inally , That the person or enterprise who wishes to avail himself or itself of this incentive should pay his apprentices the minimum wage. ART. 72.  Apprentices Without Compensation.  —   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 a requisite for graduation or board examination. Q: Is an employer required to compensate an apprentice? A: Generally yes, with atleast 75% of the statutory minimum wage. However, if the apprentice ship is required by the school or training program, or a requisite for graduation or board examination, an employer may NOT pay the apprentice any compensation if he elects to do so.

ART. 68.  Aptitude Testing of Applicants.  —   Consonant with the minimum qualifications of apprentice-applicants

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CHAPTER II  Learners

ART. 73.  Learners Defined .  —   Learners are persons hired as trainees in semi-skilled and other industrial occupations which are non-apprenticeable and which may be learned through practical training on the job in a relatively short period of time which shall not exceed three (3) months. Apprentices Hired for apprenticeable occupation Theoretical instruction required Should not exceed 6 mos. At least 14 years of age

At least 75% of the statutory minimum wage, unless it is a school requirement or for the  board exams, the employer is not required to pay.

ART. 76. Learners in Piece Work .  —  Learners employed in piece or incentive rate jobs during the training period shall be paid in full for the work done. ART. 76.  Penalty Clause.  —   Any violation of this Chapter or its implementing rules and regulations shall be subject to the general penalty clause provided for in this Code. DSITEH CHAPTER III

Learners Hired for non-apprenticeable occupations Theoretical instruction is not necessary Should not exceed 3 mos. Persons below 15 years of age cannot be hired as learners; If between 15 and 18 years of age, can only be employed in non-hazardous occupations. At least 75% of the statutory minimum wage.

ART. 74. When Learners May be Hired .  — Learners may be employed when no experienced workers are available, the employment of learners is necessary to prevent curtailment of employment opportunities, and the employment does not create unfair competition in terms of labor costs or impair or lower working standards. Conditions for Employment of Learners: (PUSÉ) 1) The job is semi-skilled or non apprenticeable ; 2)  No available experienced workers ; 3)  Necessary to prevent curtailment   of employment opportunities; and 4) It will not create unfair competition.

Age Requirement: Below 15: absolutely prohibited to be hired as learner Below 18: only in non-hazardous o ccupations

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 Handicapped Workers

ART. 78.  Definition.  —  Handicapped workers are those whose earning capacity is impaired by age or physical or mental deficiency or injury. DEFINITION: The term handicap means handicap in terms of earning capacity, not physical handicap. ( API) 1) Impaired by age; 2) Impaired by physical or mental deficiency; and 3) Injury

ART. 79. (Superseded by R.A. No . 7277 or Magna Carta of Disabled Persons) Section 32 of the Magna Carta prohibits discrimination against disabled persons in regard to hiring, promotion and other terms and conditions of employment.

ART. 80.  Employment Agreement .  —   Any employer who employs handicapped workers shall enter into an employment agreement with them which agreement shall include: (a) The names and addresses of the handicapped workers to be employed; (b) The rate to be paid the handicapped workers which shall be not less than seventy-five per cent (75%) of the applicable legal minimum wage; (c) The duration of employment period. (d) The work to be performed by handicapped workers. The employment agreement shall be subject to inspection by the Secretary of Labor or his duly authorized representatives.

ART. 75.  Learnership Agreement .  —   Any employer desiring to employ learners shall enter into a learnership agreement with them, which agreement shall include: (a) The names and addresses of the learners; (b) The duration of the learnership period, which shall not exceed three (3) months; (c) The wages or salary rates of the learners which shall begin at not less than seventy-five per cent (7 5%) of the applicable minimum wage; and (d) 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 learner. The learnership agreement shall be subject to inspection by the Secretary of Labor and Employment or his duly authorized representative.

The law does not prohibit the hiring of handicapped workers so long as their handicap does not effectively impede the  performance of job operations.

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ART. 81.  Eligibility for Apprenticeship.  —   Subject to the appropriate provisions of this Code, handicapped workers may be hired as apprentices or learners if their handicap is not such as to effectively impede the performance of job operations in the particular occupations for which they are hired. DISCUSSION:

If the disabled person is engaged as an apprentice or learner, he is entitled to the applicable compensation for apprentices and learners of atleast 75% of the statutory minimum wage. If the disabled person was not hired as an apprentice, then he is entitled to the terms and conditions of employment to able bodied employees. ( Bernardo vs. NLRC ) Hence, they have the right to be compensated the full amount of remuneration similar to those able-bodied employees.

LABOR STANDARDS (Atty. Paulino Ungos)

Q: What are the minimum standards in the payment of apprenctices, learners and handicapped or disabled persons, respectively? A: (1) For apprentices, 75% of the statutory minimum wage; (2) For learners, 75% of the statutory minimum wage unless the hiring of learners is a requirement for graduation or board examinations in which case, no remuneration is required; and (3) For disabled or handicapped workers, applicable minimum wage.

BOOK THREE Conditions of Employment 

TITLE I Working Conditions and Rest Periods

CHAPTER I  Hours of Works

ART. 82. Coverage.  —   The provisions of this Chapter shall apply to employees in all establishments and undertakings, whether for profit or not, but not to government employees, managerial employees, field personnel, members of the family of the employer who are dependent upon him for support, domestic helpers, persons in the personal service of another, and workers who are paid by results as determined by the Secretary of Labor in appropriate regulations.  As used herein, "managerial employees" refer to 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. "Field personnel" shall refer to non-agricultural employees who regularly perform their duties away from the principal place of business or branch office of the employer and whose actual hours of work in the field cannot be determined with reasonable certainty. The following are not entitled to: -

Overtime pay; Premium pay for holidays and rest days;  Night shift differential; Holiday pay; Service incentive leaves; and Service charges.

Those employees are not entitled: (1) Government employees;* (2) Managerial employees; (3) Officers and members of the managerial staff; (4) Field personnel; (5) Members of the family of the employer who are dependent upon him for support; (6) Domestic helpers insofar as rest day and service incentive leave is concerned; (7) Persons in the personal service of another; and (8) Workers paid by results. *includes employees of GOCC’s with special charters   not those GOCC’s registered under the Corporation Law.

A. Managerial Employee (Conditions): (a) His primary duty consists in the management of the establishment in which they are employed or in the management of a department or subdivision thereof;

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(b) He customarily and regularly directs the work of two or more employees therein; and (c) He has the authority to hire or fire other employees of lower rank; or his suggestions and recommendations as to hiring, firing, promotion and other personnel movements are given weight.

B. Officers or Members of Managerial Staff (Duties and Responsibilities): (a) Their primary duty consist in the performance of work directly related to management policies of their employer; (b) They customarily and regularly exercise discretion and independent judgment; (c) They regularly and directly assist a proprietor or a managerial employee whose primary duty consist of the management of the establishment in which he is employed or a subdivision thereof; or they execute under general supervision, work, along specialized or technical lines requiring special training, experience or knowledge; or they execute under general supervision special assignments and tasks; and (d) They do not devote more than 20% of their hours worked in a workweek to activities which are not directly and closely related to the performance of the work described above.

C. Field Personnel: (a) They regularly perform their duties away from the principal  place of business (or branch office) of the employer; and (b) Their actual hours of work cannot be determined with reasonable certainty.

Exception: Where the employee is constantly supervised. Hence, he shall be entitled to the benefits mentioned above.

D. Family Members: - Husband and wife; - Parents and children; - Other ascendants and descendants; and - Brothers and sisters, whether full or half-blood. Cousins, parents-in-law or children-in-law are not included.

Important: Must be dependent on the employer for support. Reason: The employer already takes care of the sustenance, dwelling, clothing, medical attendance or education of that  particular member of the family.

E. Domestic Helpers: Refers to any person, whether male or female, who renders service in and about the employer’s home on an activity which are usually necessary or desirable for the maintenance and enjoyment of the employer and ministers exclusively to the  personal comfort and enjoyment of the family. Drivers not included. Domestic helpers are entitled to rest day and service incentive leave.

F. Persons in the Personal Service of Another: Those who minister to the personal comfort, convenience or safety of the employer as well as the members of the employer’s household. Examples are personal bodyguards, private nurses and drivers.

G. Workers Paid by Results:

Those who are paid on p iece-work, takay, pakiao, or task basis.

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Important: Their output should be fixed in accordance with the standards and procedures of the Rules Implementing the Labor Code.

ART 83. Normal Hours of Work . —  The normal hours of work of any employee shall not exceed eight (8) hours a day. Health personnel in cities and municipalities with a population of at least one million (1,000,000) or in hospitals and clinics with a bed capacity of at least one hundred (100) shall hold regular office hours for eight (8) hours a day, for five (5) days a week, exclusive of time for meals, except where 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, dieticians, pharmacists, social workers, laboratory technicians, paramedical technicians, psychologists, midwives, attendants and all other hospital or clinic personnel. Q: What is the maximum number of hours of work under normal conditions? A:  Eight (8) hours in a day for five (5) consecutive days exclusive of time for meals. Q: What do you mean by the term “day?” A: It refers to the 24-hour period commencing from the time the employee regularly starts work.

Q: What is the maximum number of hours of work when there are exigent circumstances? A: An employee may be required to work for six (6) days or forty-eight (48) hours.  Provided , he be compensated with an additional compensation of at least 30% of their regular wage for work on the 6th day. The eight hour work need not be continuous. It may be staggered as long as the 8 hours falls within the 24-hour period. Work in excess of eight hou rs is overtime service.

Q: May an employer force and employee to render work? A: Generally no, because it would amount to involuntary servitude, unless there are exigent o r emergency situations.

Q: What are these exigent or emergency situations? A: Under Article 89 of the Labor Code, these are: ( ULPIaNO) (1) National emergencies or war; (2) To prevent Loss to life or property; (3) There is Imminent danger to public safety; (4) There is Urgent work to be performed on machines,

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2)  No diminution in the weekly or monthly take-home pay and fringe benefits; 3) The benefits that will accrue is more than, or commensurate with or equal to, the one-hour overtime pay that is due them during weekdays; 4) The 1-hour overtime pay of the of the employees will  become due and demandable if they are permitted to work on a Saturday; 5) The work does not involve strenuous physical exertion; and 6) Only for a temporary duration. Q: What is the “Right to Vary?” A: It is the right given to a solo parent employee to vary his or her arrival or departure time without affecting (1) the core work hours as defined by the employer and (2) individual and company productivity.

Q: Who is a solo parent? A: A solo parent is any individual who, under R.A. 8972 or Solo Parents Welfare Act, falls under any of the following categories: 1) A woman who gives birth as a result of rape and other crimes against chastity even without a final conviction of the offender:  Provided , That the mother keeps and raises the child; 2) Parent left solo or alone with the responsibility of  parenthood due to a. death of spouse;  b. detention or service of sentence of spouse for a criminal conviction for at least one (1) year; c.  physical and/or mental incapacity of spouse; d. legal separation or de facto separation from spouse for at least one (1) year, as long as he/she is entrusted with the custody of the children; e. due to declaration of nullity or annulment of marriage as decreed by a court or b y a church as long as he/she is entrusted with the custody of the children; f. abandonment of spouse for at least on e (1) year; 3) Unmarried mother/father who has preferred to keep and rear her/his child/children instead of having others care for them or give them up to a welfare institution; 4) Any other person who solely provides parental care and support to a child or children; and 5) 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.

 ART. 84.  Hours worked.  —   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.

installations or equipment; (5) To prevent loss or damage to Perishable goods; and (6) To prevent serious O bstruction to the business or operations.

Rest periods of short duration during working hours shall be counted as hours worked.

Q: What is a compressed work week? A: An instance where an employer and employee agree to

Three Principles in Determining Hours Worked: First. All hours which the employee is required to give his

 prolong the normal hours of work from Monday to Friday in exchange for elimination of Saturday work without obligating the employer to pay overtime compensation.

employer are hours worked, regardless of whether or not such hours are spent in productive labor or involve physical or mental exertion.

Q: You say, the employer and employee agree, is this agreement valid? A: Yes, the agreement is valid. Provided, the following

Second. If the work performed was necessary or it benefitted the

conditions concur: 1) The work hours from Monday to Friday is 9 hrs;

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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 b e considered

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as hours worked, if the work was done with the knowledge of his employer or immediate supervisor.

Third. The time during which an employee is inactive by reason

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A: Rest periods running from 5 to 20 minutes are considered hours of work. If it exceeds 20 minutes, then it shall not be considered hours worked.

of interruptions in his work beyod control shall be considered as hours worked 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 in the employee’s own interest.

Q: Does the employee need to leave the premises in order that his time will not be considered as hours wo rked? A:  No. It is enough that he stops working, may rest completely

FIRST PRINCIPLE:

Seamen: It being enough that he “cease to work,” may rest

Q: When an employee is engaged to wait, is the time spent waiting included as hours worked? Why? A: Yes, because he is unable to effectively use the time spent for

completely and leave or may leave at will the  spot   where he actually stays while working, to go somewhere else, whether within or outside the premises of the said factory, shop or boat.

waiting for his own purpose such as a driver or fireman.

Waiting to be engaged?  No, because the his time is not yet controlled by the employer, he is considered, not yet engaged. Hence, the employee can effectively use such time.

On call time? Yes, if he is not required to leave word at his home or he is required to inform his employer where he can be reached. If he is not required to do such duties, No.

and may leave his workplace, go elsewhere, whether within or outside the premises.

The criterion for determining whether o r not seamen are entitled to compensation is not whether they were on board and cannot leave the ship beyond the regular eight working hours a day but whether they actually rendered service in excess of eight hours a day.(for a more detailed discussion, read p. 291)

 ART. 85. Meal periods.  —  Subject to such regulations as

Yes.

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.

Travel Time? Yes, if the employee deviated from his normal

Duration: 60mins.

route to or from work to render some order from employer. (Read: Rada vs. NLRC, lumabas sa midterms)

Q: Can be the meal period shortened? A: Yes, but it should be at least 20 minutes and under certain

Attendance in lectures, meetings or training programs?  No, if all the following are present:

circumstances.

Assembly time? If subject to absolute control by the employer,

(a) Attendance is voluntary; (b) Attendance is outside the employee’s regular work hours; and (c) The employee does not do any productive work during such attendance.

Semestral Break? If the teachers cannot use the break

Q: What are these circumstances? A: (Impending 16 PUNs) (1) Where the work is non-manual in nature or does not involve strenuous physical exertion; (2) Where the establishment operates not less than 16 hours a day; (3) In case of actual impending emergencies; (4) There is urgent work to be performed on machineries, equipment or installation; or (5) It is necessary to prevent serious loss of perishable goods.

effectively for their own interest and continue to work during this short recess, No.

Q: Is the meal period compensable? A: If for less than 20 minutes, yes. If it lasts for 1 hour or more,

SECOND PRINCIPLE: Note: What is essential is knowledge  (not approval) by the employer or immediate supervisor about the rendition of work.

it is no longer considered part of hours worked, UNLESS the employee is not completely discharged during the 1 hour p eriod.

Even if there is a standing order from the employer that before rendering work, approval should be secured, any overtime work rendered without such approval is still compensable if the employer or his managerial staff had knowledge about the rendition of work. THIRD PRINCIPLE:

Q: During brownouts, is it considered hours of work? A: If the brownouts are of short duration not exceeding 20 minutes, are considered hours of work, whether used  productively by the employee or not.

Q: What if it exceeds 20 minutes? A: Generally, it is not considered hours of work. But if the employees can leave their workplace or when the employee can use the time effectively for his own interest, then, it shall be considered hours of work.

Q: Are rest period considered hours of work?

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Q: How about coffee breaks? A:  As long as it does not exceed 20 minutes, it is considered hours worked.

ART. 86.  Night-Shift Differential.  –  Every employee shall be paid a night shift differential of not less than ten percent (10%) of his regular wage for each hour of work performed between ten o’clock in the evening and six o’clock in the morning. Notes: From 10:00 PM to 6:00 AM; Those earned by way of night-shift differential is not part of the premium pay. Rate: Additional 10% of his regular wage.  Note: Lahat to additional.  Night-Shift Differential –  10% Overtime during regular day –  25% Overtine during Regular Holiday –  30% Restday –  20% Special Holiday –  20% Regular Holiday –  100%`

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Computation Procedure: Ganito lang yan... madali lang promise! a. Regular Pay (RP) = Regular Pay (anu pa ba?)  b. Premium Pay (PP) = Regular pay times Holiday/Restday Percentage c. Regular Pay Rate (R.R.) = RP divided by 8hrs d. Premium Pay Rate (P.R.) = PP divided by 8hrs e. Regular Overtime Rate (R.O.R.) = R.R. x OT Percentage f. Premium Overtime Rate (P.O.R.) = P.P.R. x OT Percentage g. Regular Nightshift Rate (R.N.R.) = R.R. x NS Differential h. Premium Nightshift Rate (P.N.R.) = P.R. x NS Differential Panu ngayon pag pumasok sa nigh tshift yung overtime? i. Regular Overtime Nightshift Rate (R.O.N.) = R.O.R. x NSD  j. Premium Overtime Nightshift Rate (P.O.N.) = P.O.R. x  NSD  Now you have all the values diba? Multiply each value with the number of hours na p asok siya. I-add mo lahat! Tapos! Dali diba?

Employees not entitled to night-shift differential. All those mentioned in Article 82, except Members of the family of the employer is not included.

ART. 87. Overtime work .  —   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. Work performed beyond eight hours on a holiday or rest day shall be paid an additional compensatin equivalent to the rate of the first eight hours on a holiday or rest day plus at least thirty percent (30%) thereof. OVERTIME RATES: 25% for Regular Day 30% for Holiday or Rest Day Work rendered during rest days is called rest day work while work rendered during holidays is holiday work.

Q: Can overtime pay be waived? A: No because it is against public policy. What you can waive is your right to claim what you earned, what you cannot waive is the right to be compensated for overtime work. “What is being waived or compromised is not the right overtime pay but the claim for unpaid (uncollected) overtime compensation.” –  Atty. Ungos

ART. 88. Undertime Not Offset by Overtime.  —  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 in some other day of the week shall not exempt the employer from paying the additional compensation required in this Chapter. Sorry, inaantok na ako kaya nagtatagalog na ako.. Basta di  pwedeng “O, umuwi ka na ng 2pm kahit tapos ng trabaho mo 5pm basta bukas hanggang 8pm ka.” Pag ganun, kung  pinayagan ka magundertime, swerte mo. P ero pag-nagovertime ka para bumawi si in-undertime mo, babayaran ka pa rin overtime compensation.

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3) Clearance from health agency; and 4) Approved by the Secretary of Labor.

ART. 89.  Emergency Overtime Work .  —   Any employee may be required by the employer to perform overtime work in any of the following cases: (a) 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; (b) 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; (c) When there is urgent work to be performed on machines, installation, or equipment, in order to avoid serious loss or damage to the employer of some other cause of similar nature; (d) When the work is necessary to prevent loss or damage to perishable goods; and (e) 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 operation of the employer. Any employee required to render overtime work under this Article shall be paid the additional compensation required in this Chapter. (1) (2) (3) (4) (5) (6)

War or Emergency Situations Disaster or Calamity Urgent Repairs Preservation of Perishable Goods Completion of Work  Take Advantage of Favorable Weather Conditions

ART. 90. Computation of Additional Compensation.  —  For purposes of computing overtime and other additional remuneration as required by this Chapter, the "regular wage" of an employee shall include the cash wage only, without deduction on account of facilities provided by the employer. “Regular Wage” is confined to the cash wage only. Cash benefits are not enjoyed with regularity and continuity do not form part of the regular wages, hence, they cannot be included in the computation of overtime pay, night shift differential, etc. For the purposes of determining the overtime and premium pay, the 13th  month pay need not be credited as part of the regular wage.

CHAPTER II Weekly Rest Periods

1) Majority of the employees consent to it; 2) Agreement between the employer and employees is put in writing;

ART. 91.  Right to Weekly Rest Day.  —   (a) It shall be the duty of any employer, whether operating for profit or not, to provide each of his employees a rest period of not less than twenty-four (24) consecutive hours for every six (6) consecutive normal work days. (b) 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

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COMPRESSED WORK WEEK:

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employees as to their weekly rest day when such preference is based on religious grounds. Q: What is a rest day? A: It is the period of inactivity of not less than 24 consecutive hours given to an employee after rendering service for a week.

Q: What is a week of labor? A: It is to be understood to embrace the ordinary number of six labor days, in the absence of an express agreement to the contrary.

Q: Does the rest day need to fall on a Sunday? A: No, it need not be on a Sunday especially if the establishment is open during Sundays and Holidays.

Q: Who has the right to choose which day of the week the rest day will fall? The employer is given the option to assign the rest day, but, if due to religious grounds, the worker may be respected of his choice. However if the employee’s absence on that day would result in serious p rejudice to the operations of the  business, the employer may schedule the preferred rest day for at least 2 days in a month.

Q: What is the rest day of health personnel? A: According to Article 83 of this Code, health personnel are given twenty four consecutive hours of rest after every six (6) consecutive normal work days. However if there are exigencies, such that, the city or municipality where he work in has a  population more than one million or in a hospital where he is employed has more than 100 beds, then the health personnel is given a rest day of 4 8 consecutive hours after 5 consecutive days of work.

ART. 92. When Employer May Require Work on A Rest Day. —  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 and property, or imminent danger to public safety; (b) In case or 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 or wok due to special circumstances, where the employer cannot o rdinarily be expected to resort to other measures; (d) Where the nature of work requires continuous operations and the stoppage of work may result in irreparable injury or loss to the employer; and (e) Under other circumstances analogous or similar to the foregoing as determined by the Secretary of Labor and Employment. Compulsory Rest Day Work, When Allowed: (1) (2) (3) (4) (5) (6) (7)

Disaster or Calamity Urgent Repairs Abnormal Pressures of Work  Preservation of Perishable Goods  Nature of Work  Favorable Weather Conditions Exigencies of Service

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additional compensation of at least thirty percent (30%) of his regular wage. An employee shall be entitled to such additional compensation for work performed on Sunday only when it is his established rest day. (b) When the nature of the work of the employee is such that he has no regular workdays and no regular rest days can be scheduled, he shall be paid an additional compensation of at least thirty percent (30%) of his regular wage for work performed on Sundays and holidays. (c) Work performed on any legal holiday shall be paid with an additional compensation of at least thirty percent (30%) of the regular wage of the employee. Where such holiday work falls on the employee's scheduled rest day, he shall be entitled to an additional compensation of at least fifty percent (50%) of his regular wage. (d) 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. Q: What is a Premium Pay? A: It is an additional compensation given to a covered employee for working on a holiday or rest day.

Rates of Premium Pay. 30% on a rest day or special day 50% on a rest d ay falling on a special holiday 200% on a regular holiday 30% in addition to his regular holiday rate, on a regular day falling on a rest day.

Tip: When asked, what is the premium pay of the employee, the  proper answer is “the regular wage plus an additional percent of his regular wage.” Q: Does an employee who work on a Sunday entitled to premium pay? A:  No, because Sunday is considered a regular day, unless it is the employee’s established rest day.

Employees Not Entitled to Premium Pay. - All employees mentioned in Article 82. (1) Government employees and those employed in Government-Owned and Controlled Corporations having a special charter; (2) Managerial employees; (3) Officers and members of the managerial staff; (4)  Non-Agricultural field personnel; (5) Members of the family of the employer who are dependent upon him for support; (6) Domestic helpers insofar as rest day and service incentive leave is concerned; (7) Persons in the personal service of another; and (8) Workers paid by results.

Important: Premium pay is an additional compensation other than and added to the regular wage or basic salary. It should not be considered in the computation of 13th month pay. Important: For special holidays, “No work, no pay” policy applies.

ART. 93. Compensation for Rest Day, Sunday or Holiday Where an employee is made or permitted to work on his scheduled rest day, he shall be paid an Work .  —   (a)

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CHAPTER III  Holidays, Service Incentive Leaves and Service Charges

ART. 94.  Right to Holiday Pay.  –  (a) Every worker shall be paid his regular daily wage during regular holidays, except in retail and service establishments regularly employing less than ten (10) workers; (b) 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; and (c) As used in this Article, “holiday” includes: New Year’s Day, Maundy Thursday, Good Friday, the ninth of

April, the first of May, the twelfth of June, the fourth of July, the thirtieth of November, the twenty-fifth and thirtieth of December and the day designated by law for holding a general election. Q: What are the regular Holidays? A: According to the Administrative Code of 1997, as amended  by R.A. No. 9492, the regular holidays are: a) Regular Holidays - New Year’s Day January 1 - Maundy Thursday Movable Date - Good Friday Movable Date - Eidul Fitr Movable Date - Araw ng Kagitingan Monday nearest April 9 - Labor Day Monday nearest May 1 - Independence Day Monday nearest June 12 - National Heroes Day Last Monday of August - Bonifacio Day Monday nearest November 30 - Christmas Day December 25 - Rizal Day Monday nearest December 30  b) Nationwide Special Holidays - Ninoy Aquino Day Monday nearest August 21 - All Saints Day November 1 - Last day of the Year December 31 c) In the event the holiday falls on a Wednesday, the holiday will be observed on the Monday of that week. If the holiday falls on a Sunday, the ho liday will be observed on the Monday that follows. d) Eidul Adha shall be celebrated as a regional holiday in the Autonomous Region in Muslim Mindanao. Pursuant to Proclamation No. 1198 (1973), For corporations whose business is situated in muslim provinces, as enumerated, shall observe the Holidays under the Code of Muslim Personal Laws, their employees are excused from reporting for work without reduction in their usual compensation . Muslim employees working outside Muslim provinces shall be excused from work in ob servance of the enumerated holidays.

Employees not Entitled to Holiday Pay.

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(6) Domestic helpers insofar as rest day and service incentive leave is concerned; (7) Persons in the personal service of another; and (8) Workers paid by results.

Piece Rate Persons  –  No Sale s Personnel –  No Seasonal Workers –  No Teachers and Faculty Members  –  During Christmas vacation, Yes. During semestral breaks, No. Those paid per lecture hour,  No. Panu pag regular holiday? Nada. Alam naman kasi nila na during those days, hindi sila magtatarabaho eh.

Monthly-Paid Employees – Yes! How to determine if the holiday pay is included in the wages: When the total earned wages for the year divided by 251 days would result to his regular monthly wage, then holiday pay is not included. When the total earned wages for the year divided  by 261 days would amount to his regular monthly wage, then, the holiday pay is deemed included.

Effect of Absences, how to know if you are entitled to holiday pay: RULES: Entitled to holiday pay when they are on leave of absence with pay.  Not entitled when they are on leave o absence without pay on the day immediately preceding the regular holiday. Entitled, if the days immediately preceding the regular holiday is a non-working day or rest day, he is deemed to  be on leave of absence on that day, provided, he worked on the day immediately preceding the non-working day or rest day. For two successive regular Holidays, not entitled if the employee is absent the day preceding the first regular Holiday. But, if he works on the first holiday, he is entitled to holiday pay on the second holiday. 

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Q: How much compensation is the employee entitled when two regular holidays fall on the same day? A: The employee should be paid for both the regular holidays. So, he will be earning 100% of his regular wage, plus an additional 100% for the first holiday and another additional 100% for the second holiday for an aggregate premium pay of 300%.

Q: Is an employee entitled to Holiday Pay if the business is closed? A: Yes if the closure is temporary. Obviously no, if the closure is permanent.

- All employees mentioned in Article 82 except members of the family of the employer and including employees of retail and service establishments. (1) Government employees and those employed in Government-Owned and Controlled Corporations having a special charter; (2) Managerial employees; (3) Officers and members of the managerial staff; (4)  Non-Agricultural field personnel; (5) Employees of the retail and service establishments regularly employing less than 10 workers;

ART. 95.  Right to Service Incentive Leave.  –  (a) Every employee who has rendered at least one year of service shall be entitled to a yearly service incentive leave of five days with pay.

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(b) This provision shall not apply to those who are already enjoying the benefit herein provided, those enjoying vacation leave with pay of at least five days and those employed in establishments regularly employing less than ten employees or in establishment exempted from granting this benefit by the Secretary of Labor and Employment after

LABOR STANDARDS (Atty. Paulino Ungos)

considering the viability or financial condition of such establishment. (c) The grant of benefit in excess of that provided herein shall not be made a subject of arbitration or any court or administrative action. Note: 5 days of service incentive leave is granted to an employee who rendered at least one year of service. If it is not exhausted by the end of the year, it may be converted to cash.

Employees not Entitled to Service Incentive Leave. - All employees mentioned in Article 82 except those employees paid by results and including employees of establishments with less than 10 employees and those already enjoying vacation leave. (1) Government employees and those employed in Government-Owned and Controlled Corporations having a special charter; (2) Managerial employees; (3) Officers and members of the managerial staff; (4)  Non-Agricultural field personnel; (5) Employees of the retail and service establishments regularly employing less than 10 workers; (6) Domestic helpers insofar as rest day and service incentive leave is concerned; (7) Persons in the personal service of another; and (8) Those who are already enjoying vacation leave with pay of at least 5 days; and (9) Those employed in establishments regularly employing less than ten employees.

ART. 96. Service Charges. –  All service charges collected by hotels, restaurants and similar establishments shall be distributed at the rate of eighty-five percent (85%) for all covered employees and fifteen percent (15%) for management. The share of the employees shall be equally distributed among them. In case the service charge is abolished, the shore of the covered employees shall be considered integrated in their wages. Employees not Entitled to Service Charges - All employees except managerial employees.

Distribution of Charges - 85% for the employees divided equally among them and 15% for the management for its disposition to answer for losses and breakages and for distribution to managerial employees.

Q: Can employees be required to post a bond before employment? A: No, if service charge is being collected by the establishment. Q: What if the service charge was abolished? A: The share of the covered employees shall be consi-dered integrated in their wages. The basis o f the amount is the average monthly share for the past 12 months immediately preceding the abolishment.

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TITLE II Wages

CHAPTER I  Preliminary Matters

ART. 97. Definitions. —  As used in this Title: (a) "Person" means an individual, partnership, association, corporation, business trust, legal representative, or any organized group or person.  (b)"Employer" includes any person acting directly or indirectly in the interest of an employer in relation to an employee and shall include the Government and all its branches, subdivisions and instrumentalities, all government-owned or controlled corporations and institutions, as well as non-profit private institutions or organizations. (c) "Employee" includes any individual employed by an employer. (d) "Agriculture" includes farming in all its branches and among other things includes the cultivation and tillage of soil, dairying the production, cultivation, growing and harvesting of any agricultural and horticultural commodities, the raising of livestock or poultry, and any practices performed by a farmer or on a farm as an incident to or in conjunction with such farming operations, but does not include the manufacturing or processing of sugar, coconuts, abaca, tobacco, pineapples or other farm products. (e) "Employ" includes to suffer or permit to work. (f) "Wage" paid to any employee shall mean the remuneration or earnings, however designated, capable of being expressed in terms of money, whether fixed or ascertained on a time, task, piece, or commission basis, or other method of calculating the same, which is payable by an employer to an employee under a written or unwritten contract of employment for work done or to be done, or for services rendered or to be rendered, and includes the fair and reasonable value, as determined by the Secretary of Labor, 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. Q: What are wages? A: Wages are remunerations or earnings payable by an employer to an employee for work done or to be done or for services rendered or to be rendered. It should arise from an employer-employee relationship.

Q: What is the distinction between salaries and wages? A: The Labor Code does not distinguish one from the other. Wages is too broad a term that salaries are considered included in it. The fine line would be, wages refers to compensation to manual labor, skilled or unskilled, while salaries denote a higher grade of employment, or a superior grade of service and implies a position of office. Wages indicate pay for a low character employment, whereas salaries are of higher and more important service. Important:  If it is not wages, it will not fall under the Labor Code, instead the Civil Code.

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If there is no employer-employee relationship, it not considered as wages. Article 1708 of the Civil Code exempt’s a laborer’s wage from execution or attachment except   for debts incurred for food, shelter, clothing, and medical attendance.

Q: What are facilities? A: Facilities are expenses necessary for the laborer’s and his family’s existence and subsistence. It includes rice ration, housing, medical treatments, school facilities, cost of water, electricity, fuel, etc.

Q: Are facilities included in the wages? A: Yes because it includes the fair and reasonable value of  board, lodging, and other facilities customarily furnished by the employer to the employee.

Q: What do you mean by customarily? A: It means that the furnishing of facilities is founded on long established and constant practice connoting regularity.

Q: May the employer deduct these facilities from his wages? A: Yes, provided, that: 1) 2) 3) 4)

The facilities are customarily furnished; The provision of deductible facilities must be voluntarily accepted; The facilities must be fair and reasonable; and There must be a written authorization from the employee to deduct.

Q: What are supplements? A: They are extra remuneration or special privileges or benefits given to or received by the labourers over and above their ordinary earnings or wages. They are not part of wages. They are given merely to augment the earnings of the employee.

Q: Give examples of supplements? A: Vacation leave pay, overtime pay, sick, pension, retirement and death benefits, profit sharing, allowances, Christmas bonus, etc.

Q: How will you determine if the benefit is a facility or supplement? A: If it inures primarily to the benefit of the employer, then it is a facility.

Q: Can the employer deduct the benefits? A: According to Article 100, No. BONUS –  is an amount granter and paid to an employee for his industry and loyalty which contributed to the success of the employer’s business and made possible the realization of profits. It is an act of generosity.

GEN. RULE: Bonus is not demandable nor an enforceable obligation.

EXCEPTION: When the bonus has become a matter of r ight. Q: When does it become a matter of right? A: If the grant is the result of an agreement or if it is made part of the wages.

Q: How can a bonus become part of wages? A: If it is given in a fixed amount without and condition,

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Thirteenth Month Pay It is an extra remuneration given to employees in an amount equivalent to 1/12 of the basic salary  earned by an employee within a calendar year,  provided , such employee has rendered service for at least one year.

Computation: Basic salary divided by 12. Basic salary ha? Hindi premium salary.

Who are Entitled to 13 th month pay: (1) All rank-and-file employees; (2) Employees paid on piece-work basis; (3) Employees who are paid a fixed or guaranteed wage plus commission; (4) Private school teachers who have rendered at least one year of service; (5) Employees working for two or more firms (they are entitled to collect from all employers); (6) Employees who resigned or whose services were terminated before the payment of the 13 th month pay; (7) Household helpers. - All employees mentioned in Article 82 except those employees paid by results and including employees of establishments with less than 10 employees and those already enjoying vacation leave.

Employees not Entitled to 13 th Month Pay: (1) Government employees and those employed in Government-Owned and Controlled Corporations having a special charter; (2) Employers already paring their employees a 13 th month pay or more in a calendar year or its equivalent; (3) Those who have rendered less than one year of service; and (4) Employees paid purely on commission.

Q: What if equivalent pay is less than the 1/12 of the employee’s basic salary ? A: The employer is bound to pay o nly the difference. Time of payment of 13 th month pay. Either not later than December 24 in full or one before the opening of the regular school year and the other half on or  before December 24.

14th month pay  Not mandated by law; Gratuitous in nature; and a managerial  prerogative. Hence, it is not demandable.

Q: When is the 14 th month pay demandable? A: When the requisites are met: (1) (2) (3) (4)

If it is a company practice; If it arises from a contract; If it was made part of wages; It is given regardless whether the employer realized profits or not.

 ART. 98.  Application of Title.  —   This Title shall not

apply to farm tenancy or leasehold, domestic service and persons working in their respective homes in needlework or in any cottage industry duly registered in accordance with law.

whether the employer realized profits or not; or if the granting of  bonus has ripened into a practice.

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Coverage of the Law on Wages The provisions of the Labor Code on wages apply to all employees except: (1) Household helpers; (2) Persons in the personal service of another; (3) Homeworkers engaged in needlework; (4) Workers employed in the cottage industry; (5) Workers of a registered cooperative; and (6) Farm tenancy and leasehold.

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employee benefits being enjoyed at the time of promulgation of this Code. Principle of Non-Diminution of Benefits: A benefit regularly and voluntarily granted without conditions  becomes part of the terms and conditions of employment, and therefore, it cannot be unilaterally withdrawn or reduced.

Q: Name cases where the principle do not apply to? A: The principle is not violated if the action

 ART. 99. Statutory Minimum Wages.  —   The minimum

(a) does not result in reduction or elimination of benefits; (b) if what is deducted is the fair and reasonable value of facilities; (c) if an employer reduces the bonuses it used to grant its employees; and (d) if it discontinues a benefit that has been granted by mistake.

REMEDY: The aggrieved party can appeal to the National Wages Commission within ten (10) days.

Q: When does the grant of benefits become a “Company Practice?” A: To be considered as company practice, it should have been observed over a long period of time and must be shown to have  been consistent and deliberate.

CHAPTER II  Minimum Wage Rates

wage rates for agricultural and non-agricultural employees and workers in each and every region of the country shall be those prescribed by the Regional Tripartite Wages and Productivity Boards.

METHODS IN FIXING THE MINIMUM WAGE: (a) The Floor-Wage method; and (b) The Salary-Ceiling  method. FLOOR-WAGE METHOD prescribes a determinate amount that would be added  to the prevailing statutory minimum wage. SALARY-CEILING METHOD prescribes a wage adjustment  that would apply only employees receiving a certain denominated salary ceiling.

Q: Can you waive the minimum wage? A: The minimum wage fixed by law is mandatory. It cannot be waived. The term “wage” includes the fair and reasonable value, as determined by the Secretary of Labor and Employment, of  board, lodging or other facilities furnished by the employer to the employee.

Q: Can you bargain the minimum wage? A: It is an area beyond the sphere of collective bargaining  between the parties. It is fixed by law. Not even the consent of the employees themselves suffices to defeat its operations.

Q: If the minimum wage is not followed, what is the sanction? A: Failure to pay the prescribed wage increase or cost of living allowances will subject the employer to CRIMINAL LIABILITY and DOUBLE INDEMNITY.

Note: This is the relief mentioned earlier in Article 17. AGRICULTURE means farming in all its branches and any  practice performed by a farmer on a farm as an incident to or in conjunction with farming operations. It includes: (a) The cultivation and tillage of soil; (b) Dairying; (c) The production, cultivation, growing and harvesting of agricultural and horticultural commodities; and (d) The raising of livestocl or poultry.

 ART. 100.  Prohibition Against Elimination or Diminution of Nothing in this Title shall be construed to eliminate, or in any way diminish supplements, or other 

 Benefits.  —  

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Q: What is “Payment by Mistake?”

A: When an employer grants benefits to his employees which had never been due. It may be a mistake of fact or mistake of law.

ART. 101.  Payments by results.  —   The Secretary of Labor and Employment shall regulate the payment of wages by results, including  pakyao, piecework and other non-time work, in order to ensure the payment of fair and reasonable wage rates, preferably through time and motion studies or in consultation with representatives of workers' and employers' organization. CHAPTER III  Payment of Wages

ART. 102.  Forms of Payment .  —   No employer shall pay the wages of an employee by means of promissory notes, vouchers, coupons, tokens, tickets, chits or any object other than legal tender, even when expressly requested by the employee. Payment of wages by check or money order shall be allowed when such manner of payment is customary on the date of effectivity of this Code, or is necessary because of special circumstances as specified in appropriate regulations to be issued by the Secretary of Labor or is stipulated in a collective bargaining agreement. Q: In what form should wages be paid? A: Generally, in legal tender. However, the employer and his employees may agree that it be made by check or money o rder. LEGAL TENDER  –   is that currency which had been made suitable by law for the purpose of tender of payment of debts. All notes and coins issued by the Bangko Central are legal tender. A check is not a legal tender. Principle of “No Work, No Pay” If there is no work performed by the employee there can be no wage or pay, unless the employee was illegally locked out, dismissed, or suspended. It is based on an age-old rule “fair day’s wage for a fair labor.”

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Remedy: If payment of wages made not in legal tender  –   file a

2)

complaint for unpaid wages even if he accepted tokens, etc.

Note: The law is clear that wages should be made in legal tender. Even if the method of payment was agreed upon by the  parties or the employee himself made the request.

Q: Can payment be made using checks or money order? A: Yes. It is allowable only in the following cases:

3)

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Employer provides for transportation to and from the place where the salary is to be distributed; Analogous circumstance, provided the time spent by the employees collecting their wages shall be considered as compensable hours worked.

PAYMENT IN RECREATIONAL PLACES, PROHIBITED, except for employees working in such places.

(a) It is customary on the date of the effectivity of the Labor Code; (b) So stipulated in a collective bargaining agreement (agreement with the union); or (c) When there is a bank or other facilities for encashment: a. Within a radius of 1km from the workplace;  b. The employer or his agents do not receive eny  pecuniary benefit from the arrangement; c. The employees are given reasonable time during  banking hours to withdraw their wages on company time; and d. The employee consents to such an arrangement.

PAYMENT THROUGH ATM’s REQUISITES: 1) Written consent of the employee; 2) Reasonable time to withdraw their wages from the bank, if done during working hours, considered hours worked; 3) Without prejudice to Art. 103 with regard to frequency of  payment; 4) Within 1km to the place of work; 5) Upon request of the employee; 6)  No additional expenses and no diminution of benefits and  privileges; and 7) Employer shall be responsible when the law are not complied with.

ART. 103. Time of Payment .  —   Wages shall be paid at least once every two (2) weeks or twice a month at intervals not exceeding sixteen (16) days. If on account of  force majeure  or circumstances beyond the employer's control, payment of wages on or within the time herein provided cannot be made, the employer shall pay the wages immediately after such  force majeure or circumstances have ceased. No employer shall make payment with less frequency than once a month. The payment of wages of employees engaged to perform a task which cannot be completed in two (2) weeks shall be subject to the following conditions in the absence of a collective bargaining agreement or arbitration award: (1) That payments are made at intervals not exceeding sixteen (16) days, in proportion to the amount of work completed; and (2) That final settlement is made upon completion of the work.

 ART. 105.  Direct Payment of Wages.  - Wages shall be

Circumstances that may justify delayed payment: (a) Force Majeure; or (b) Circumstances beyond employer’s control.  Force Majeure –  refers to events which arise from legitimate or illegitimate acts of persons o ther than the employer, such as war, robbery, arson, etc. Circumstances bend control  –   refers to fortuitous events independent of human intervention, such as flood, typhoons, earthquakes, and other natural calamities.

ART. 104.  Place of Payment. - Payment of wages shall be made at or near the place of undertaking, except as otherwise provided by such regulations as the Secretary of Labor and Employment may prescribe under conditions to ensure greater protection of wages. 

GENERAL RULE: The payment of wages should be made at the place of business.

paid directly to the workers to whom they are due, except: (a) In cases of  force majeure  rendering such payment impossible or under other special circumstances to be determined by the Secretary of Labor and Employment in appropriate regulations, in which case, the worker may be paid through another person under written authority given by the worker for the purpose; or  (b) Where the worker has died, in which case, the employer may pay the wages of the deceased worker to the heirs of the latter without the necessity of intestate  proceedings.   The claimants, if they are all of age, shall

execute an affidavit attesting to their relationship to the deceased and the fact that they are his heirs, to the exclusion of all other persons. If any of the heirs is a minor, the affidavit shall be executed on his behalf by his natural guardian or next-of-kin. The affidavit shall be presented to the employer who shall make payment through the Secretary of Labor and Employment or his representative. The representative of the Secretary of Labor and Employment shall act as referee in dividing the amount paid among the heirs. The payment of wages under this Article shall absolve the employer of any further liability with respect to the amount paid. GENERAL RULE: Wages shall be paid directly to the workers to whom they are due. EXCEPTION: Can be paid to another person when: 1) Employer is authorized in writing that it shall be paid to a member of the family; 2) Payment is authorized by existing law; 3) Death of an employee; and 4) Force Majeure and employee executes a written authority for the delivery of his wages to another person.

EXCEPTIONS: 1) Deterioration of peace and order or actual or impending emergencies;

PAYMENT OF WAGES OF AN EMPLOYEE WHO HAS DIED: Intestate proceedings are not necessary. The heirs should simply submit to the employer an affidavit attesting to their relationship with the deceased and the fact that they are his heirs, to the exclusion of all other persons. If any of the heirs is a minor, the natural guardian or next of kin shall execute the affidavit in his behalf. Upon presentation of the affidavit, the

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LABOR STANDARDS (Atty. Paulino Ungos)

employer shall make payment to the heirs as representative of the Secretary. Payment in accordance with the foregoing  procedure will relieve the employer from further liability with respect to the amount paid.

ART. 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 contractingout 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. Decides

CONTRACTOR

Undertakes

WORKER

Finishes

a. to perform the work on his own account;  b. under his own responsibility; c. according to his own manner and method; d. free from control and direction of the p rincipal in all matters connected with the performance of work EXCEPT as to the results thereof. 2) The SubCon/Con must have substantial capital or investment in the form of tools, equipment, machineries and other materials which are necessary in the conduct of his business.

Q: What does substantial capital or investment mean? A: That the contractor or subcontractor has fully subscribed and  paid for its capital stock.

Q: What if the (sub)contractor is not registered? A: There is a presumption of “labor -only” contracting? Q: What if the presumption is not overcome? A: The employees of the (sub)contractor will become employees of the principal.

Legal Effect of Legitimate Contracting or Subcontracting An employer who enters into a contract with a legitimate contractor does not thereby create an employer-employee relationship between himself and the employees of the contractor. The employees of the contractor remain the contractor’s employees and his alone When the contractor fails to pay the wages of his employees in accordance with the Labor Code, the employer becomes jointly and severally liable with his contractor for wages “to the extent of the work performed under the contract.” The principal may seek reimbursement from contractors for wages he paid. He should file his claim in the regular courts and not with the NLRC.

Q: When is Contracting or Subcontracting Illegal? A: Being contrary to law or public policy, contracting or

TRILATERAL RELATIONSHIP: (Art. 107) PRINCIPAL

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Power to Control Means and ends

With E.E. Relationship

Only Ends

 No E.E. Relationship

There is contracting or subcontracting when an employer engages the services of a contractor to perform a certain work, task or job on his own account under his own r esponsibility free from the control and direction of his employer in all matters except as to the result of the work. Contracting or subcontracting is no illegal  per se. It is perfectly legal for an employer to engage a contractor to perform  janitorial, security, collection, maintenance, merchandising, messengerial, and technical services or specialized works. REQUISITES OF VALID (SUB)CONTRACTING: 1) The SubCon/Con must have a distinct and independent  business and must undertake

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subcontracting is illegal in the following cases: (C  dean Ulan Galit, at Illegal daw R ectruitment ng Lex Talionis) 1) Labor-Only Contracting; 2) Contracting out work with a “ Cabo;” 3) Contracting out work through an In-house agency; 4) Contracting out work that is directly R elated to the  business of the principal by reason of strike or lock-out, whether actual or imminent; 5) Contracting out work when not done in Good faith and not  justified by the exigencies of the same resulting in: a. The termination of regular employees;  b. Reduction of work hours; or c. Reduction or splitting of the bargaining unit. 6) Contracting out work being performed by Union members when such will interfere with the exercise of their right to self organization. (Unfair Labor Practice)

Q: What is Labor-Only Contracting? A: an arrangement whereby the contractor: 1)

does not have substantial capital or investment in the form of tools, equipment, and work premises: and 2) merely recruits, supplies or places workers only; to the principal employer to perform a job, work or activity that is directly related to the main business of the principal employer.

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Elements or Labor-Only Contracting (D Wade Scores) (a) Contractor supplies Workers only; (b) The undertaking is Directly related to the main business of the principal; and (c) The contractor does not have Substantial capital in the form of tools, equipment and work premises.

Legal Effect of Labor-Only Contracting When there is “Labor -Only” contracting, the law establishes an employer-employee relationship between the principal employer and the employees of the contractor. The contractor is considered as a mere agent of the principal employer and, therefore, both the principal and the contractor are solidarily liable for all the rightful claims of the employees. (Art. 109) Contracting Out Work with a “ Cabo”  –   refers to a person or group of persons or to a labor group which, in the guise of a labor organization, supplies workers to an employer, whether as an agent of the principal or as an independent contractor.

Contracting Out Work Through an In-House Agency  –  refers to a contractor or subcontractor engaged in the supply of labor which is owned, managed or controlled by the principal and which operates solely for the principal.

Contracting Out Work During a Strike or Lockout  –   becomes illegal only if the job, work, or service contracted is directly related to the business of the principal.

Contracting Out Work Being Performed by Union Members  –  becomes illegal only when such, will interfere with, restrain or coerce employees in the exercise of their right to selforganization.

Contracting Out Work Resulting in the Termination of Regular Employees. Reduction of work hours, reduction or splitting of the bargaining unit becomes illegal only when not done in good faith AND not justified by the exigencies of the  business.

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ART. 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. ART. 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. As mentioned earlier, if the principal was to be held solidarily liable with the contractor, the former shall be liable to any claims by the employees. What are these claims? A: The principal employer shall be liable jointly and severally with the contractor for the employees back wages, separation  pay and damages.

Q: Can the employee sue the government? A: Yes. As defined in Article 97(b) of the Labor Code, the term “employer ” shall include the Government and all its branches, subdivision and instrumentalities, all government-owned or controlled corporations and institutions.

Q: Where may an employee file his claims? A: File it with the NLRC since the word “employer” includes the Government, the NLRC may exercise jurisdiction over cases involving claims of employees.

ART. 110. Worker Preference in Case of Bankruptcy . - In the event of bankruptcy or liquidation of an employer’s

business, his workers shall enjoy first preference as regards their wages and other monetary claims, any provisions of law to the contrary notwithstanding. Such unpaid w ages and monetary claims shall be paid in full before claims of the government and other creditors may be paid.

ART. 107.  Indirect Employer.  - The provisions of the immediately preceding article shall likewise 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.

Note: For Article 110 to become effective, there must be  bankruptcy or insolvency proceedings, or judicial liquidation of the business of the employer, otherwise, this Article will hold no ground.

Contractors and Sub-Contractors are required to register with the DOLE. Failure to register shall give rise to the presumption that the contractor is engaged in labor-only contracting.

Q: What if the business, say a bank, is put into a receivership, and is undergoing rehabilitation proceedings, is Article 110 in force? A: Duh, no.. the law is clear that it must be bankruptcy or

Q: What is the Trilateral Relationship in contracting arrangements? A: Under the trilateral relationship, the principal d ecides the job or service to be contracted out, while the contractor undertakes to perform a job or service, and the workers accomplish the job or service.

Q: How will you determine if the relationship between the principal and the contractor is for contracting or subcontracting purposes? A: When the contractor undertakes the job or service and the  principal has control only as to the results of the job or service and not to how it will be performed or the means employed by the contractor.

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liquidation proceedings. Kumbaga, ayaw nang i-tuloy ni  principal negosyo niya. Mag file ka na lang nang claim tapos maghanap ka na ng bagong trabaho. Kung naka-receivership siya, eh di suspended lang yung operation kasi medyo nalulugi na, pero employed ka pa rin.

Q: What if the employer announces, that he will stop operating the business without entering into any judicial proceedings and, the employees found out that the employer entered into an agreement with his creditors for the payment of debts, how will the employees assert their claim? A: Opinio Non Juris.  Normally, the employees may demand from the stockholders or employer to execute and affidavit of  personal liability, since there is no judicial proceedings, the employees have no right to initiate the same. However, they may

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LABOR STANDARDS (Atty. Paulino Ungos)

claim for damages based on Article 28 of the Civil Code which states: Art. 28. Unfair competition in agricultural, commercial or industrial enterprises or in labor through the use of force, intimidation, deceit, machination or any other unjust, oppressice or highhanded method shall give rise to a right of action  by the person who thereby suffers damage. A: According to Master “Boy Tinder,” the relationship between the employer and employee becomes a credit-debtor relationship. The employees may file a case for the collection of sum of money based on contract under the Civil Code.

Q: What are the monetary claims available to the employees? (BDSM) A: Backwages, Damages, if any and Separation Pay monetary claims.

Q: Who are the claimants of the employer or business owner? A: The Government; the employees regarding their monetary claims; and the business owner’s creditors.

Q: What are the kinds of credits under the Civil Code? A: Special preferred credits, Ordinary preferred credits and Common credits.

Monetary Claims of Workers  Not all monetary claims of workers fall under the category of special preferred credits. Only those specified in Article 2241(6) and Article 2242(3) of the Civil Code are considered as special  preferred credits, namely: (a) Claims for laborer’s wages, on the goods manufactured or the work done; and (b) Claims of labourers, masons, mechanics and other workmen, as well as architects, engineers and contractors, engaged in the construction, reconstruction or repair of  buildings, canals or other works, upon the same buildings, canals or other works.

Q: What is the legal effect in the order of preference of credits under the Civil Code when the Labor Code, in relation to Article 110, was promulgated? A: The use of the phrase “first preference” in Article 110 of the Labor Code merely modifies the order of preference found in Article 2244 of the Civil Code. The modification consists in: (a) Removing the one year limitation found in Article 2244(2) of the Civil Code; and (b) Moving up claims for unpaid wages and other monetary claims of labourers or workers. The taxes listed in Articles 2241 and 2242 of the Civil Code, stand first in preference with respect to the particular property to which the tax liens have attached, as provided by Article 2243 of the Civil Code which states: “taxes mentioned in No.1, Article 2241, and No.1, Article 2242, shall first be satisfied. ”

after the taxes on the specific property involved have been paid . Special preferred credits are to be paid only

Article 110 of the Labor Code does not constitute a lien on the  property of the insolvent debtor in favour of workers. It is just a  preference of credit in their favor. Preference of credits applies only to claims which do not attach to specific properties, while a lien attaches to a particular property.

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ART. 111.  Attorney’s fees.  - (a) In cases of unlawful withholding of wages, the culpable party may be assessed attorney’s fees equivalent to ten percent (10%) of the

amount of wages recovered.

(b) It shall be unlawful for any person to demand or accept, in any judicial or administrative proceedings for the recovery of wages, attorney’s fees which exceed ten percent

(10%) of the amount of wages recovered. CHAPTER IV

 Prohibitions Regarding Wages

 ART. 112.  Non-interference in Disposal of Wages.  - No

employer shall limit or otherwise interfere with the freedom of any employee to dispose of his wages. He shall not in any manner force, compel, or oblige his employees to purchase merchandise, commodities or other property from any other person, or otherwise make use of any store or services of such employer or any other person. PROHIBITIONS: -

Disposal Deduction Deposit Limitations Withholding / Kickbacks Promise Employment / Retention Retaliatory False Reporting

 ART. 113. Wage Deduction. - No employer, in his own

behalf or in behalf of any person, shall make any deduction from the wages of his employees, except: (a) In cases where the worker is insured with his consent by the employer, and the deduction is t o recompense the employer for the amount paid by him as premium on the insurance; (b) 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 (c) In cases where the employer is authorized by law or regulations issued by the Secretary of Labor and Employment. What are the lawful deductions? (I IWAS, FOULE 3D pa rin?) 1) Insurance premiums advanced by the employer; 2) Union dues, where the right to check-off has been recognized by the employer; Agency fees assessed by the collective bargaining agent against non-union members; 4) S pecial assessments or extraordinary fees levied by a collective bargaining agents against its members. 5) Fair and reasonable value of Facilities; 6) O bligations of an employee to third persons; 7) Cost of Lost or damaged tools, materials or equipment; 8) Due and demandable Debt of an employee to his employer; 9) Deductions made in compliance with Writs of execution or attachment against the employee for debts incurred for food, shelter, clothing and medical attendance; 10) Income Tax; 11) Employee’s shares in the premium contributions to the SSS; 3)

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LABOR STANDARDS (Atty. Paulino Ungos)

12)

Empoyee’s share in the premium contributions to the

Philhealth; and 13) Employee’s contribution to the Pag-Ibig Fund.

Q: Can an employer deduct the cost of uniforms? A:  No, even if the employee executes a written authorization. Pinagpilitan ka nang mag-uniform, pagbabayarin ka pa?

Q: If an employer reduces the number of workdays due to economic reasons, can it also make the corresponding reduction in the salaries or wages? A: Yes. In situations where the reduction in the number of regular working days is resorted to by the employer to prevent serious losses due to cause beyond his control, such reduction is valid. Q: What is a “ Check-off ” Fee?

A: 

Q: Can an employer be compelled to check-off union dues? A: No.

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GEN RULE: The employer may not require his employees to make a deposit for any future loss or breakage of any tools, materials or equipment. EXCEPTIONS: If the employer is engaged in such trade; or requiring deposits is a recognized practice; or  necessary or desirable as determined by the Secretary. In establishments where service charge is collected, the employees are not required to make any deposits because 15% of the service charge belongs to the management, under his  prerogative, give to his other employees or answer for the loss or damage to his tools or equipment.

Q: Can a taxi driver be required to make a deposit? A: if the deposit or deduction is to wash the unit after the tour of duty, yes. But if the deposit or deduction is to answer for the deficient “boundary” payment, then there  is a violation of Article 114 of the Labor Code.

 ART. 115.  Limitations. - No deduction from the deposits

Q: What if the employer rejects deducting the check-off dues? A: The employer’s failure to make the requisite reduction may

of an employee for the actual amount of the loss or damage shall be made unless the employee has been heard thereon, and his responsibility has been clearly shown.

constitute a violation of a contractual commitment for which he may incur liability for unfair labor practice.

Q: May when an employee be required to pay for any loss or damage? A: (a) When the employee is given the opportunity to b e heard;

Q: May non-union members avail of the right to check-off? A: Yes, non-union members belonging to the appropriate  bargaining unit who accepts the benefits of the CBA may avail of this right.

Q: Are they required to make a written check-off authorization? A:  No, they don’t. The employee’s acceptance of the benefits resulting from the CBA justifies the deduction of agency fees from his salary.

Q: What are the requisites of a valid check-off or special assessment or other extraordinary expenses? A: The requisites are: 1)

2) 3)

There must be a written resolution by a majority of all the members at a general membership meeting duly called for the purpose; The minutes of the meeting duly recorded by the secretary of the union and attested by the union president; and Individual written check-off authorization by the employees concerned.

Q: What is the most important requisite? A:  No. 3. That there must b e a written check-off authorization  by the employees concerned.

 ART. 114.  Deposits for Loss or Damage. - No employer

shall require his worker to make deposits from which deductions shall be made for the reimbursement of loss of or damage to tools, materials, or equipment supplied by the employer, except when the employer is engaged in such trades, occupations or business where the practice of making deductions or requiring deposits is a recognized one, or is necessary or desirable as determined by the Secretary of Labor and Employment in appropriate rules and regulations.

(b) He was found responsible for the loss or breakage; and (c) The amount required of him does not exceed the actual damage. (d) The deduction does not exceed 20% of the employee’s wages in a week.

 ART. 116. Withholding of Wages and Kickbacks

 Prohibited. -

It shall be unlawful for any person, directly or indirectly, to withhold any amount from the wages of a worker or induce him to give up any part of his wages by force, stealth, intimidation, threat or by any other means whatsoever without the worker’s consent.

Q: What are the prohibited acts under Article 116? A: These are the withholding of any amount from the wages of the worker; and inducing an employee to give up any part of his wages by force, stealth, intimidation, threat or any other means without the employee’s consent.

Q: What will be the liability of the employer for such violation? A: The employer may incur criminal liability, pay double the claim of the employee, and in proper cases payment of at least 10% of the Attorney’s fee..

ART. 117.  Deduction to Ensure Employment. - It shall be unlawful to make any deduction from the wages of any employee for the benefit of the employer or his representative or intermediary as consideration of a promise of employment or retention in employment. 

Q: What is the scope of Article 117? A: Article 117 prohibits the deduction from the wages of an employee as consideration for: (a) promise of employment; or (b) retention of employment.

 ART. 118. Retaliatory Measures. - It shall be unlawful for

an employer to refuse to pay or reduce the wages and

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LABOR STANDARDS (Atty. Paulino Ungos)

benefits, discharge or in any manner discriminate against any employee who has filed any complaint or instituted any proceeding under this Title or has testified or is about to testify in such proceedings. ART. 119. False Reporting. - It shall be unlawful for any person to make any statement, report, or record filed or kept pursuant to the provisions of this Code knowing such statement, report or record to be false in any material respect. CHAPTER V Wage Studies, Wages Agreements and Wage Determination

ART. 120. Creation of National Wages and Productivity Commission. - There is hereby created a National Wages and Productivity Commission, hereinafter referred to as the Commission, which shall be attached to the Department of Labor and Employment (DOLE) for policy and program coordination. ART. 121.  Powers and Functions of the Commission. The Commission shall have the following powers and functions: (a) To act as the national consultative and advisory body to the President of the Philippines and Congress on matters relating to wages, incomes and productivity; (b) To formulate policies and guidelines on wages, incomes and productivity improvement at the enterprise, industry and national levels; (c) To prescribe rules and guidelines for the determination of appropriate minimum wage and productivity measures at the regional, provincial, or industry levels; (d) To review regional wage levels set by the Regional Tripartite Wages and Productivity Boards to determine if these are in accordance with prescribed guidelines and national development plans; (e) To undertake studies, researches and surveys necessary for the attainment of its functions and objectives, and to collect and compile data and periodically disseminate information on wages and productivity and other related information, including, but not limited to, employment, costof-living, labor costs, investments and returns; (f) To review plans and programs of the Regional Tripartite Wages and Productivity Boards to determine whether these are consistent with national development plans; (g) To exercise technical and administrative supervision over the Regional Tripartite Wages and Productivity Boards; (h) To call, from time to time, a national tripartite conference of representatives of government, workers and employers for the consideration of measures to promote wage rationalization and productivity; and (i) To exercise such powers and functions as may be necessary to implement this Act. The Commission shall be composed of the Secretary of Labor and Employment as ex-officio chairman, the DirectorGeneral of the National Economic and Development Authority (NEDA) as ex-officio vice-chairman, and two (2) members each from workers’ and employers’ sectors who

shall be appointed by the President of the Philippines upon recommendation of the Secretary of Labor and Employment

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to be made on the basis of the list of nominees submitted by the workers’ and employers’ sectors, respectively, and who

shall serve for a term of five (5) years. The Executive Director of the Commission shall also be a member of the Commission. The Commission shall be assisted by a Secretariat to be headed by an Executive Director and two (2) Deputy Directors, who shall be appointed by the President of the Philippines, upon the recommendation of the Secretary of Labor and Employment. The Executive Director shall have the same rank, salary, benefits and other emoluments as that of a Department Assistant Secretary, while the Deputy Directors shall have the same rank, salary, benefits and other emoluments as that of a Bureau Director. The members of the Commission representing labor and management shall have the same rank, emoluments, allowances and other benefits as those prescribed by law for labor and management

representatives

Compensation Commission.

in

the

Employees’

ART. 122. Creation of Regional Tripartite Wages and  Productivity Boards. - There is hereby created Regional Tripartite Wages and Productivity Boards, hereinafter referred to as Regional Boards, in all regions, including autonomous regions as may be established by law. The Commission shall determine the offices/headquarters of the respective Regional Boards. The Regional Boards shall have the following powers and functions in their respective territorial jurisdictions: (a) To develop plans, programs and projects relative to wages, incomes and productivity improvement for their respective regions; (b) To determine and fix minimum wage rates applicable in their regions, provinces or industries therein and to issue the corresponding wage orders, subject to guidelines issued by the Commission; (c) To undertake studies, researches, and surveys necessary for the attainment of their functions, objectives and programs, and to collect and compile data on wages, incomes, productivity and other related information and periodically disseminate the same; (d) To coordinate with the other Regional Boards as may be necessary to attain the policy and intention of this Code; (e) To receive, process and act on applications for exemption from prescribed wage rates as may be provided by law or any Wage Order; and (f) To exercise such other powers and functions as may be necessary to carry out their mandate under this Code. Implementation of the plans, programs, and projects of the Regional Boards referred to in the second paragraph, letter (a) of this Article, shall be through the respective regional offices of the Department of Labor and Employment within their territorial jurisdiction; Provided, however , That the Regional Boards shall have technical supervision over the regional office of the Department of Labor and Employment with respect to the implementation of said plans, programs and projects. Each Regional Board shall be composed of the Regional Director of the Department of Labor and Employment as chairman, the Regional Directors of the National Economic and Development Authority and the Department of Trade Page 28

LABOR STANDARDS (Atty. Paulino Ungos)

and Industry as vice-chairmen and two (2) members each from workers’ and employers’ sectors who shall be

appointed by the President of the Philippines, upon the recommendation of the Secretary of Labor and Employment, to be made on the basis of the list of nominees submitted

by

the

workers’

and

employers’

sectors,

respectively, and who shall serve for a term of five (5) years. Each Regional Board to be headed by its chairman shall be assisted by a Secretariat. (As amended by Republic Act No. 6727, June 9, 1989). ART. 123. Wage Order. - Whenever conditions in the region so warrant, the Regional Board shall investigate and study all pertinent facts; and based on the standards and criteria herein prescribed, shall proceed to determine whether a Wage Order should be issued. Any such Wage Order shall take effect after fifteen (15) days from its complete publication in at least one (1) newspaper of general circulation in the region. In the performance of its wage-determining functions, the Regional Board shall conduct public hearings/consultations, giving notices to employees’ and employers’ groups, provincial, city and municipal officials

and other interested parties. Any party aggrieved by the Wage Order issued by the Regional Board may appeal such order to the Commission within ten (10) calendar days from the publication of such order. It shall be mandatory for the Commission to decide such appeal within sixty (60) calendar days from the filing thereof. The filing of the appeal does not stay the order unless the person appealing such order shall file with the Commission, an undertaking with a surety or sureties satisfactory to the Commission for the payment to the employees affected by the order of the corresponding increase, in the event such order is affirmed. (As amended by Republic Act No. 6727, June 9, 1989). ART. 124. Standards/Cr iteri a for minimum wage fi xing.  The regional minimum wages to be established by the Regional Board shall be as nearly adequate as is economically feasible to maintain the minimum standards of living necessary for the health, efficiency and general wellbeing of the employees within the framework of the national economic and social development program. In the determination of such regional minimum wages, the Regional Board shall, among other relevant f actors, consider the following: (a) The demand for living wages; (b) Wage adjustment vis-à-vis the consumer price index; (c) The cost of living and changes or increases therein; (d) The needs of workers and their families; (e) The need to induce industries to invest in the countryside; (f) Improvements in standards of living; (g) The prevailing wage levels; (h) Fair return of the capital invested and capacity to pay of employers; (i) Effects on employment generation and family income; and (j) The equitable distribution of income and wealth along the imperatives of economic and social development. The wages prescribed in accordance with the provisions of this Title shall be the standard prevailing

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minimum wages in every region. These wages shall include wages varying with industries, provinces or localities if in the  judgment of the Regional Board, conditions make such local differentiation proper and necessary to effectuate the purpose of this Title. Any person, company, corporation, partnership or any other entity engaged in business shall file and register annually with the appropriate Regional Board, Commission and the National Statistics Office, an itemized listing of their labor component, specifying the names of their workers and employees below the managerial level, including learners, apprentices and disabled/handicapped workers who were hired under the terms prescribed in the employment contracts, and their corresponding salaries and w ages. Where the application of any prescribed wage increase by virtue of a law or wage order issued by any Regional Board results in distortions of the wage structure within an establishment, the employer and the union shall negotiate to correct the distortions. Any dispute arising from wage distortions shall be resolved through the grievance procedure under their collective bargaining agreement and, if it remains unresolved, through voluntary arbitration. Unless otherwise agreed by the parties in writing, such dispute shall be decided by the voluntary arbitrators within ten (10) calendar days from the time said dispute was referred to voluntary arbitration. In cases where there are no collective agreements or recognized labor unions, the employers and workers shall endeavor to correct such distortions. Any dispute arising therefrom shall be settled through the National Conciliation and Mediation Board and, if it remains unresolved after ten (10) calendar days of conciliation, shall be referred to the appropriate branch of the National Labor Relations Commission (NLRC). It shall be mandatory for the NLRC to conduct continuous hearings and decide the dispute within twenty (20) calendar days from the time said dispute is submitted for compulsory arbitration. The pendency of a dispute arising from a wage distortion shall not in any way delay the applicability of any increase in prescribed wage rates pursuant to the provisions of law or wage order. As used herein, a wage distortion shall mean 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. All workers paid by result, including those who are paid on piecework, takay ,  pakyaw   or 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. All recognized learnership and apprenticeship agreements shall be considered automatically modified insofar as their wage clauses are concerned to reflect the prescribed wage rates. (As amended by Republic Act No. 6727, June 9, 1989).

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LABOR STANDARDS (Atty. Paulino Ungos)

Q: What is wage distortion? A: Wage distortion is a situation where an increase in the  prescribed wage rates results in the elimination or severe contraction  of intentional quantitative differences in wages or salary rates between and among employee groups in an establishment as to effectively onliterate  the distinctions embodied in such wage structure based on skills, length of service, or other logical bases of differentiation.

Elements of Wage Distortion: (a) An existing hierarchy   of positions with corresponding salary rates; (b) A significant change in the salary rate of a lower pay class without concomitant increase in the salary rate of a higher one; (c) Elimination or severe contraction of the distinction  between two levels; and (d) The existence of the distortion  in the same region of the county.

Note: If there’s a CBA, wage distortion may be valid. Procedure for Correction of Wages Distortion A. Unionized Establishment

(a) The employer and the union shall negotiate to create the distortions. (b) If the negotiations fail, the matter shall be brought to the grievance machinery  under their collective bargaining agreement. (c) If the grievance machinery fails to settle the dispute, the matter shall be threshed out through voluntary arbitration.

B. Non-Unionized Establishment

(a) The employers and workers shall negotiate to correct such distortions. (b) If the negotiations fail, the matter shall be brought to the  National Conciliation and Mediation Board for conciliation. (c) If conciliation fails, the dispute shall be referred to the appropriate branch of the National Labor Relations for compulsory arbitration.

Q: Does the restoration from a wage distortion require that the historical gap be returned? A: There is no legal requirement that the historical gap that existing before the implementation of the wage ord er be resorted to in precisely the same form or amount.

ART. 125. F reedom to bargain. - No wage order shall be construed to prevent workers in particular firms or enterprises or industries from bargaining for higher wages with their respective employers. (As amended by Republic Act No. 6727, June 9, 1989). ART. 126. Prohibition against injunction.  –  No preliminary or permanent injunction or temporary restraining order may be issued by any court, tribunal or other entity against any proceedings before the Commission or the Regional Boards. (As amended by Republic Act No. 6727, June 9, 1989). ART. 127. Non-diminution of benefits. - No wage order issued by any regional board shall provide for wage rates lower than the statutory minimum wage rates prescribed by

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Congress. (As amended by Republic Act No. 6727, June 9, 1989). Chapter VI ADMINISTRATION AND ENFORCEMENT

ART. 128. Visitorial and enforcement power.   - (a) 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. (b) Notwithstanding the provisions of Articles 129 and 217 of this Code to the contrary, and in cases where the relationship of employer-employee 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. (As amended by Republic Act No. 7730, June 2, 1994). An order issued by the duly authorized representative of the Secretary of Labor and Employment under this Article may be appealed to the latter. In case said order involves a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly accredited by the Secretary of Labor and Employment in the amount equivalent to the monetary award in the order appealed from. (As amended by Republic Act No. 7730, June 2, 1994). (c) The Secretary of Labor and Employment may likewise order stoppage of work or suspension of operations of any unit or department of an establishment when noncompliance with the law or implementing rules and regulations poses grave and imminent danger to the health and safety of workers in the workplace. Within twenty-four hours, a hearing shall be conducted to determine whether an order for the stoppage of work or suspension of operations shall be lifted or not. In case the violation is attributable to the fault of the employer, he shall pay the employees concerned their salaries or wages during the period of such stoppage of work or suspension of operation. (d) It shall be unlawful for any person or entity to obstruct, impede, delay or otherwise render ineffective the orders of the Secretary of Labor and Employment or his duly authorized representatives issued pursuant to the authority granted under this Article, and no inferior court or entity shall issue temporary or permanent injunction or Page 30

LABOR STANDARDS (Atty. Paulino Ungos)

restraining order or otherwise assume jurisdiction over any case involving the enforcement orders issued in accordance with this Article. (e) Any government employee found guilty of violation of, or abuse of authority, under this Article shall, after appropriate administrative investigation, be subject to summary dismissal from the service. (f) The Secretary of Labor and Employment may, by appropriate regulations, require employers to keep and maintain such employment records as may be necessary in aid of his visitorial and enforcement powers under this Code. Powers of the Secretary of Labor

Inspect the records and premises of an employer; Copy pertinent records or documents; Question any employee; and Investigate any fact, condition or matter.

Q: When can the visitorial power be exercised? A: At any time of the day or night, whenever work is being undertaken therein.

Q: What if during the exercise of visitorial powers, violations of Labor Standards were found? A: Art. 128-B becomes operational (enforcement power) and the Secretary or his Regional Director may issue writs of execution.

Q: Where does the visitorial power and enforcement power exercised? A: It is exercised over the establishment and not over the individual employees.

Q: Say, the Secretary or the Regional Director issued an order against an establishment, to which employees does the order apply? A: The entire employees who are still working   with said establishment should benefit therefrom even if they did not sign the complaint or request for inspection . Midterm

Exams:

Maternity

Secretary of Labor (p. 452)

Children’s

Hospital

Power Basis for the exercise of  power Subject Matter / Issues

Amount Involved Appellate Body Period to Appeal

Powers under visitorial power 1. 2. 3. 4.

(2) Raises issues supported by documentary proofs which were not considered during the inspection.

Workers involved

(a) Visitorial power; (b) Enforcement power; and (c) Power to order suspension or stoppage of operations.

vs.

Remedies: A party aggrieved by an Order issued by the Regional Director in connection with the exercise of the visitorial and enforcement powers under Article 128 of the Labor Code can avail of the following remedies: (1) Motion for Reconsideration, to be filed within seven calendar days from receipt of the Order; and (2) Appeal to the Secretary of Labor and Employment, to be filed within ten days from receipt of the Order. A motion for reconsideration filed beyond the seven-day reglementary period shall be treated as an appeal if filed within the ten-day period for appeal, but subject to the requirements for the perfection of an appeal.

Limitations:  The Secretary of DOLE or his duly authorized representatives cannot exercise the enforcement power under Art. 128 of the Labor Code when the employer: (1) Contests the findings of Labor Standard & Welfare Officer; and

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Incidental Powers

Article 128

Article 129

Visitorial and Enforcement Powers Inspection Result

Adjudicatory Powers

Violations of labor and occupational health standards Only to employees still in service

Complaint

Purely money claims

 No limit to the amount involved Secretary of DOLE

Includes also those separated from service and does not seek reinsatement Cannot exceed P5,000 NLRC

10 calendar days

5 calendar days

Includes the power to order suspension or stoppage of operations

ART. 129. 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 such complaint does not include a claim for reinstatement: Provided further, That the aggregate money claims of each employee or househelper does not exceed Five thousand pesos (P5,000.00). 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. 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. 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. Any decision or resolution of the Regional Director or hearing officer pursuant to this provision may be appealed on the same grounds provided in Article 223 of this Code, within five (5) calendar days from receipt of a copy of said decision or resolution, to the National Labor Relations Commission which shall resolve the appeal within ten (10) calendar days from the submission of the last pleading required or allowed under its rules. Page 31

LABOR STANDARDS (Atty. Paulino Ungos)

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. (As amended by Section 2, Republic Act No. 6715, March 21, 1989) . Adjudicatory Power: Article 129 confers upon the Regional Director of DOLE the authority to hear and decide claims for unpaid wages and other monetary claims and benefits filed  by an employee or person employed in domestic or household service,  whose employment has been terminated and does not seek reinstatement anymore .

Requisites for Valid Exercise of the Adjudicatory Power: (APES) (a) The claim is Purely for recovery for unpaid wages and other monetary claims and benefits; (b) The claim is  filed by an Employee, househelper or person employed in domestic or household service; (c) The employee, househelper or person employed in domestic of household service has already been Separated  from service and does not seek reinstatement anymore; and (d) The A ggregate money claims  of each claimant does not exceed P5,000.

Q: What if the requisites are incomplete? A: The case will fall within the exclusive jurisdiction of the Arbitration Branch of the NLRC.

Q: What are the issues of cases falling within the jurisdiction of the NLRC? A: (a) Praying for Reinstatement for termination of employment and the claim does not exceed P5,000; (b) The monetary claim exceeds P5,000; and (c) Illegal dismissal of the employee which is no longer purely a money claim.

Title III WORKING CONDITIONS FOR SPECIAL GROUPS OF EMPLOYEES

Chapter I EMPLOYMENT OF WOMEN

Changes made by R.A. No. 10151: (a) Renumbering of the  provisions of the Labor Code; (b) Prior to its enactment, the Labor Code prohibited women from performing n ight work, it is now limited to pregnant women and nursing mothers; and (c) added Chapter 5 in this Title. Coverage: All employees except those employed in agriculture, stock raising, fishing, maritime transport and inland navigation.

Rights added: (1) Right to free health assessment: (a) before taking up an assignment as a night worker; (b) at regular intervals; and (c) if they experience health problems caused by reason of performing such work (Art. 155). (2) Right to be transferred to a similar job which they are fit to work (Art. 157).

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(5) Right of pregnant women against dismissals and diminution of benefits on account of pregnancy.

ART. 130. F acilities for women. - The Secretary of Labor and Employment shall establish standards that will ensure the safety and health of women employees. In appropriate cases, he shall, by regulations, require any employer to: (a) Provide seats proper for women and permit them to use such seats when they are free from work and during working hours, provided they can perform their duties in this position without detriment to efficiency; (b) To establish separate toilet rooms and lavatories for men and women and provide at least a dressing room for women; (c) To establish a nursery in a workplace for the benefit of the women employees therein; and (d) To determine appropriate minimum age and other standards for retirement or termination in special occupations such as those of flight attendants and the like. (As renumbered by R.A. No. 10151)

ART. 131. Maternity leave benefits. - (a) Every employer shall grant to any pregnant woman employee who has rendered an aggregate service of at least six (6) months for the last twelve (12) months, maternity leave of at least two (2) weeks prior to the expected date of delivery and another four (4) weeks after normal delivery or abortion with full pay based on her regular or average weekly wages. The employer may require from any woman employee applying for maternity leave the production of a medical certificate stating that delivery will probably take place within two weeks. (b) The maternity leave shall be extended without pay on account of illness medically certified to arise out of the pregnancy, delivery, abortion or miscarriage, which renders the woman unfit for work, unless she has earned unused leave credits from which such extended leave may be charged. (c) The maternity leave provided in this Article shall be paid by the employer only for the first four (4) deliveries by a woman employee after the effectivity of this Code. (As renumbered by R.A. No. 10151)

Maternity Leave REQUISITES: (1) Has paid at least 3 months of her SSS Contribution. (2) Notification is given to the employer of the probable date of delivery. (3) Applies only to first 4 deliveries. BENEFITS: (1) 100% salary during her period of leave; (2) 60-day leave for normal delivery and 78-day leave for caesarean delivery; (3) Full payment of delivery expenses to be advanced by employer.

Paternity Leave

(4) Right of pregnant women to alternatives to night work during certain periods (Art. 158).

CONDITIONS FOR ENTITLEMENT: (1) Employed at the time of delivery; (2) Notified his employer of the pregnancy of his wife and her expected date of delivery; and (3) His wife has given birth, su ffers a miscarriage or an abortion.

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(3) Right to safe working conditions (Art. 1 56).

LABOR STANDARDS (Atty. Paulino Ungos)

IMPORTANT FACTORS: (1) Married to his pregnant legal wife; (2) Cohabitating with legal wife; (3) Applicable only to first 4 deliveries; (4) Employed at the time of delivery; (5) Notice is given to his employer; (6) Presentation of marriage certificate; (7) Submission of birth certificate or medical certificate; (8) Not convertible to cash; and (9) Not applicable after 60-days from delivery. BENEFITS: (1) 7-day leave with pay.

Parental Leave for Solo Parents REQUISITES: (1) 1- year of service whether continuous or broken; (2) Must notify the employer of the availment; and (3) Must present his Solo Identification Card.

Q: Who is a solo parent? A: (a) A woman who gives b irth as a result of rape or crimes against chastity even without a final conviction of the offender,  provided, that the mother keeps and raises the child; (b) Parent left solo or alone with the responsibility of parenthood due to: (i) death of spouse; (ii) detention or service of sentence of spouse for a criminal conviction for at least one (1) year; (iii) physical and/or mental incapacity of spouse as certified by a public medical practitioner; (iv) legal separation or de facto separation from spouse of at least one (1) year, as long as he/she is entrusted with the custody of the children; (v) declaration of nullity or annulment of marriage as decreed by a court r y a church as long as he/she is entrusted with the custody of the children; (vi) abandonment of spouse for at least one (1) year; (c) Unmarried mother/father 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; (d) Any other person who solely provides parental care and support to a child or children, provided he/she is duly licensed as a foster parent by the DSWD or duly appointed legal guardian  by the court; (e) Any family member who assumes the responsibility of head of a family as a result of the death, abandonment, disappearance, or prolonged absence of the parents or solo parent, provided, that such abandonment, disappearance, or absence lasts for at least one (1) year. BENEFITS: (1) 7-day leave with pay which is non-cumulative.

ART. 132. F amily planning services; incentives for  family planning. - (a) Establishments which are required by law to maintain a clinic or infirmary shall provide free family planning services to their employees which shall include, but not be limited to, the application or use of contraceptive pills and intrauterine devices.

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planning among female workers in any establishment or enterprise. (As renumbered by R.A. No. 10151)  ART. 133. Discrimination prohibited.   - 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: (a) 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 (b) Favoring a male employee over a female employee with respect to promotion, training opportunities, study and scholarship grants solely on account of their sexes. Criminal liability for the willful commission of any unlawful act as provided in this Article or any violation of the rules and regulations issued pursuant to Section 2 hereof shall be penalized as provided in Articles 288 and 289 of this Code: Provided, That the institution of any criminal action under this provision shall not bar the aggrieved employee from filing an entirely separate and distinct action for money claims, which may include claims for damages and other affirmative reliefs. The actions hereby authorized shall proceed independently of each other. ( As amended by R.A.  No. 6725 and renumbered by R.A. No. 10151).  ART. 134.  Stipulation against marr iage. - It shall be

unlawful for an employer to require as a condition of employment or continuation of employment that a woman employee shall not get married, or to stipulate expressly or tacitly that upon getting married, a woman employee shall be deemed resigned or separated, or to actually dismiss, discharge, discriminate or otherwise prejudice a woman employee merely by reason of her marriage. (As renumbered  by R.A. No. 10151)

Prohibited Acts under Article 134: 1) Requiring as a condition of employment that a female employee shall not get married; 2) Requiring a female employee to resign upon getting married; or 3) Dismissing or discriminating against female employee  because of her marriage.

ART. 135. Prohibited acts.  - (a) It shall be unlawful for any employer: (1) 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. (2) To discharge such woman on account of her pregnancy, or while on leave or in confinement due to her pregnancy; (3) To discharge or refuse the admission of such woman upon returning to her work for fear that she may again be pregnant. (As renumbered by R.A. No. 10151) Prohibited Acts under Article 135:

(b) In coordination with other agencies of the government engaged in the promotion of family planning, the Department of Labor and Employment shall develop and prescribe incentive bonus schemes to encourage family

1) Dismissing a female employee for the purpose og preventing her from enjoying the maternity leave benefit and other benefits or facilities; 2) Dismissing a female employee on account of her pregnancy, or while on leave or in confinement due to her pregnancy; and

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3) Dismissing or refusing admission of a female employee upon returning to her work for fear that she may again be pregnant.

terms and conditions of employment on account of his age.

ART. 136. Classification of certain women workers . Any woman who is permitted or suffered to work, with or without compensation, in any night club, cocktail lounge, massage clinic, bar or similar establishments under the effective control or supervision of the employer for a substantial period of time as determined by the Secretary of Labor and Employment, shall be considered as an employee of such establishment for purposes of labor and social legislation. (As renumbered by R.A. No. 10151)

READ:  Apex Mining Co. v. NLRC   and  Barcenas v. NLRC

Chapter II EMPLOYMENT OF MINORS

ART. 137.  Mi nimum employable age. - (a) No child below fifteen (15) years of age shall be employed, except when he works directly under the sole responsibility of his parents or guardian, and his employment does not in any way interfere with his schooling. (b) Any person between fifteen (15) and eighteen (18) years of age may be employed for such number of hours and such periods of the day as determined by the Secretary of Labor and Employment in appropriate regulations. (c) The foregoing provisions shall in no case allow the employment of a person below eighteen (18) years of age in an undertaking which is hazardous or deleterious in nature as determined by the Secretary of Labor and Employment. (As renumbered by R.A. No. 10151)

Q: What is the minimum age of employment? A: Generally, the minimum age of employment is fifteen (15) years old.

Q: Are there any exceptions? A: Yes. There are two instances. The  first   is when the child works directly under the sole responsibility of his parents or legal guardian and only members of his family are employed therein, provided that: (a) the employment of the child neither endangers his life, safety, health and morals, nor impairs his normal development; (b) his parent or legal guardian provides the said child with the prescribed primary and/or secondary education; and (c) his employer obtains an employment permit. The second is when the child’s employment or participation in  public and entertainment or information through cinema, theatre, radio or television is essential.

Children below 15 years Hours of work

Night Work

Children 15 years old but below 18 years old

 Not more than 4  Not more than 8 hours a day but not hours a day but not more than 20 hours more than 40 hours a week a week Cannot be made to Cannot be made to work from 8:00 work from 10:00 PM to 6:00 AM. PM to 6:00 AM

(As renumbered by R.A. No. 10151) (p.484)

Chapter III EMPLOYMENT OF HOUSEHELPERS

ART. 139. Coverage.  - This Chapter shall apply to all persons rendering services in households for compensation. " 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. (As renumbered by R.A. No. 10151)

Non-compliance With the Stipulated Period (Art.147): Househelper fails to comply: forfeit any unpaid salary due him not exceeding fifteen (15) days. Employer fails to comply: pay the househelper an indemnity equivalent to fifteen (15) days pay.

ART. 140. Contract of domestic service. - The original contract of domestic service shall not last for more than two (2) years but it may be renewed for such periods as may be agreed upon by the parties. (As renumbered by R.A. No. 10151)

ART. 141.  Mi nimum wage. - (a) Househelpers shall be paid the following minimum wage rates: (1) Eight hundred pesos (P800.00) a month for househelpers in Manila, Quezon, Pasay, and Caloocan cities and municipalities of Makati, San Juan, Mandaluyong, Muntinlupa, Navotas, Malabon, Parañaque, Las Piñas, Pasig, Marikina, Valenzuela, Taguig and Pateros in Metro Manila and in highly urbanized cities; (2) Six hundred fifty pesos (P650.00) a month for those in other chartered cities and first-class municipalities; and (3) Five hundred fifty pesos (P550.00) a month for those in other municipalities. Provided, That the employers shall review the employment contracts of their househelpers every three (3) years with the end in view of improving the terms and conditions thereof. Provided, further, That those househelpers who are receiving at least One thousand pesos (P1,000.00) shall be covered by the Social Security System (SSS) and be entitled to all the benefits provided thereunder. (As amended by R.A.  No. 7655 and renumbered by R.A. No. 10151). ART. 142.  Mi nimum cash wage. - The minimum wage rates prescribed under this Chapter shall be the basic cash wages which shall be paid to the househelpers in addition to lodging, food and medical attendance. (As renumbered by R.A. No. 10151)

ART. 143.  Assignment to non-household work.  - No househelper shall be assigned to work in a commercial, industrial or agricultural enterprise at a wage or salary rate lower than that provided for agricultural or nonagricultural workers as prescribed herein. (As renumbered by 

R.A. No. 10151)

ART. 138. Prohibition against child discrimination. - No employer shall discriminate against any person in respect to

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Q: What is the prohibition on assignment to non-household work? Page 34

LABOR STANDARDS (Atty. Paulino Ungos)

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A: What is prohibited is not the assignment of the houshelper to

Domestic Helper Wages:

a non-household work but the payment of a wage or salary rate lower than those prescribed for the non-household work.

Metro Manila  –   P2,500 First Class Cities  –   P2,000 Municipalities  –   P1,500

Q: When will Article 143 not apply? A: When the househelper is paid with the proper commercial, industrial or agricultural wage rate.

 ART. 144. Opportunity for education. - If the househelper

is under the age of eighteen (18) years, the employer shall give him or her an opportunity for at least elementary education. The cost of education shall be part of the househelper’s compensation, unless there is a stipulation to the contrary. (As renumbered by R.A. No. 10151)

Domestic Helper Benefits: - 13th month pay - Service incentive leave - Covered by SSS, Philhealth and Pag-ibig

SSS Contributions: - Wages is more than P5,000/month –   employer and employee  pays for his own share - Wages is less than P5,000/month  –   the employer shoulders the househelper’s share.

 ART. 145. Treatment of househelpers. - The employer

shall treat the househelper in a just and humane manner. In no case shall physical violence be used upon the househelper. (As renumbered by R.A. No. 10151)

Working hours of househelpers:  Not more than 10 hours a day and must be allowed 4 days vacation each month. The househelper must be given 8 hours of rest (need not be continuous) and 24-hours rest day (need not be continuous).

 ART. 146. Board, lodgi ng, and medical attendance. - The

employer shall furnish the househelper, free of charge, suitable and sanitary living quarters as well as adequate food and medical attendance. (As renumbered by R.A. No. 10151)

ART. 147. I ndemnity for unj ust termination of services. If the period of household service is fixed, neither the employer nor the househelper may terminate the contract before the expiration of the term, except for a just cause. If the househelper is unjustly dismissed, he or she shall be paid the compensation already earned plus that for fifteen (15) days by way of indemnity. If the househelper leaves without justifiable reason, he or she shall forfeit any unpaid salary due him or her not exceeding fifteen (15) days. (As renumbered by R.A. No. 10151)

Chapter IV EMPLOYMENT OF HOMEWORKERS

ART. 151. Regulation of industri al homework ers.  - The employment of industrial homeworkers and field personnel shall be regulated by the government through the appropriate regulations issued by the Secretary of Labor and Employment to ensure the general welfare and protection of homeworkers and field personnel and the industries employing them. (As renumbered by R.A. No. 10151)

Industrial Homework is a system of production under which work for an employer or contractor is carried out by a homeworker at his home.

Limitation  –   Homework is not allowed in the manufatrue or  processing of: (a) explosives, fireworks and similar articles; (b) drugs and poisons; and (c) other articles, the processing of which requires exposure to toxic substances. == P Paarrtt  o of f  LLeeccttuurree ART. 152. Regulations of Secretary of Labor. - The regulations or orders to be issued pursuant to this Chapter shall be designed to assure the minimum terms and conditions of employment applicable to the industrial homeworkers or field personnel involved. (As renumbered by

 ART. 148. Service of termination notice. - If the duration

R.A. No. 10151)

of the household service is not determined either in stipulation or by the nature of the service, the employer or the househelper may give notice to put an end to the relationship five (5) days before the intended termination of the service. (As renumbered by R.A. No. 10151)

ART. 153. Distribution of homework. - For purposes of this Chapter, the " employer"  of homeworkers includes any person, natural or artificial who, for his account or benefit, or on behalf of any person residing outside the country, directly or indirectly, or through an employee, agent contractor, sub-contractor or any other person: (1) 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 his directions; or (2) Sells any goods, articles or materials to be processed or fabricated in or about a home and then rebuys them after such processing or fabrication, either by himself or through some other person. (As renumbered by R.A. No. 10151)

 ART. 149. E mployment certif ication.  - Upon the

severance of the household service relation, the employer shall give the househelper a written statement of the nature and duration of the service and his or her efficiency and conduct as househelper. (As renumbered by R.A. No. 10151) ART. 150. E mployment record.   - The employer may keep such records as he may deem necessary to reflect the actual terms and conditions of employment of his househelper, which the latter shall authenticate by signature or thumbmark upon request of the employer.   (As renumbered by R.A. No. 10151)

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Contractor or Subcontractor refers to any person who, for the account or benefit of an employer, delivers or causes to be delivered to a homeworker goods or articles to be processed in

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LABOR STANDARDS (Atty. Paulino Ungos)

or about his home and thereafter to be returned, disposed of or distributed in accordance with the direction of the employer.

Chapter V EMPLOYMENT OF NIGHT WORKERS

Art. 154. Coverage  –   This chapter shall apply to all persons, who shall be employed or permitted or suffered to work at night, except those employed in agriculture, stock raising, fishing, maritime transport and inland navigation, during a period not less than seven (7) consecutive hours, including the interval from midnight to five o’clock in the

morning, to be determined by the Secretary of Labor and Employment,

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‘Night worker’ means any employed person whose

work requires performance of a substantial number of hours of night work which exceeds a specified limit. This limit shall be fixed by the Secretary of Labor after consulting the workers’ representatives/labor organizations and employers. (As amended R.A. No. 10151)

Art. 155. H ealth Assessment  –  At their request, workers shall have the right to undergo a health assessment without charge and to receive advice how to reduce or avoid health problems associated with their work: (a) Before taking up an assigntment as a night worker; (b) At regular intervals during such an assignment; and (c) If they experience health problems during such an assignment which are not caused by factors other than the performance of night work. With the exception of a finding of unfitness for night work, the findings of such assessments shall not be transmitted to others without the worker’s consent and shall not be used to their detriment. (As amended by R.A. No. 10151)

Art. 156.  Mandatory F acilities - Suitable first-aid facilities shall be made available for workers performing night work, including arrangements where such workers, where necessary, can be taken immediately to a place for appropriate treatment. The employers are likewise required to provide safe and healthful working conditions and adequate or reasonable facilities such as sleeping or resting quarters in the establishment and transportation from the work premises to the nearest point of their residence subject to exceptions and guidelines to be provided by the Department of Labor and Employment. (As amended by R.A.  No. 10151)

Art. 157. Transfer  –  Night workers who are certified who are certified as unfit for night work, due to health reasons, shall be transferred, whenever practicable, to a similar job for which they are fit to w ork. If such transfer to a similar job is not practicable, these workers shall be granted the same benefited as other workers who are unable to work, or to secure employment during such period. A night worker certified as temporarily unfit for night work shall be given the same protection against dismissal or notice of dismissal as other workers who are prevented from working for reasons of health. (As amended by R.A. No. 10151)

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San Beda College Alabang

Art. 158. Women Night Workers.  –   Measures shall be taken to ensure that an alternative to night work is available to women workers who would otherwise be called upon to perform such work: (a) Before and after childbirth, for a period of at least sixteen (16) weeks, which shall be divided between the time before and after childbirth; (b) For additional periods, in respect of which a medical certificate is produced stating that said additional periods are necessary for the health of the mother o r child: (1) During pregnancy; (2) During a specified time beyond the period, after childbirth is fixed pursuant to subparagraph (a) above, the length of which shall be determined by the DOLE after consulting the labor organizations and employers. During the periods referred to in this article: (i) A woman worker shall not be dismissed or given notice of dismissal, except for just or authorized causes provided for in this Code that are not connected with pregnancy, childbirth and childcare responsibilities. (ii) A woman worker shall not lose the benefits regarding her status, seniority, and access to promotion which may attach to her regular night w ork position. Pregnant women and nursing mothers may be allowed to work at night only if a competent physician, other than the company physician, shall certify their fitness to render work, and specify, in the case of pregnant employees, the period of the pregnancy that they can safely work. The measures referred to in this article may include transfer to day work where this is possible, the provision of social security benefits or a extension of maternity leave. The provisions of this article shall not have the effect of reducing the protection and benefits connected with maternity leave under existing laws. Art. 159. Compensation  –   The compensation for night workers in the form of working time, pay or similar benefits shall recognize the exceptional nature of night work. (As amended by R.A. No. 10151)

Art. 160.  Social Services.  –   Appropriate social services shall be provided for night workers and, where necessary, for workers performing night work. (As amended by R.A.  No. 10151)

Art. 161. Night Work Schedules.  –   Before introducing work schedules requiring the services of night workers, the employer shall consu lt the workers’ representatives/labor organizations concerned on the details of such schedules and the forms of organization of night work that are best adapted to the establishment and its personnel, as well as on the occupational health measures and social services which are required. In establishments employing night workers, consultation shall take place regularly. (As amended by R.A.  No. 10151)

Title I MEDICAL, DENTAL AND OCCUPATIONAL SAFETY

Chapter I MEDICAL AND DENTAL SERVICES

ART. 162. F irst-aid treatment.  - Every employer shall keep in his establishment such first-aid medicines and Page 36

LABOR STANDARDS (Atty. Paulino Ungos)

equipment as the nature and conditions of work may require, in accordance with such regulations as the Department of Labor and Employment shall prescribe. The employer shall take steps for the training of a sufficient number of employees in first-aid treatment. ART. 163. E mergency medical and dental servi ces. - It shall be the duty of every employer to furnish his employees in any locality with free medical and dental attendance and facilities consisting of: (a) The services of a full-time registered nurse when the number of employees exceeds fifty (50) but not more than two hundred (200) except when the employer does not maintain hazardous workplaces, in which case, the services of a graduate first-aider shall be provided for the protection of workers, where no registered nurse is available. The Secretary of Labor and Employment shall provide by appropriate regulations, the services that shall be required where the number of employees does not exceed fifty (50) and shall determine by appropriate order, hazardous workplaces for purposes of this Article; (b) The services of a full-time registered nurse, a parttime physician and dentist, and an emergency clinic, when the number of employees exceeds two hundred (200) but not more than three hundred (300); and (c) The services of a full-time physician, dentist and a full-time registered nurse as well as a dental clinic and an infirmary or emergency hospital with one bed capacity for every one hundred (100) employees when the number of employees exceeds three hundred (300). In cases of hazardous workplaces, no employer shall engage the services of a physician or a dentist who cannot stay in the premises of the establishment for at least two (2) hours, in the case of those engaged on part-time basis, and not less than eight (8) hours, in the case of those employed on full-time basis. Where the undertaking is non-hazardous in nature, the physician and dentist may be engaged on retainer basis, subject to such regulations as the Secretary of Labor and Employment may prescribe to insure immediate availability of medical and dental treatment and attendance in case of emergency. (As amended by Presidential Decree NO. 570-A, Section 26)

San Beda College Alabang

 ( Finals Labstan) Required Medical and Dental Services 10 to 50 workers

Graduate First-aider Full-time registered nurse A full-time first-aider will 51 to 200 workers suffice if the workplace is non-hazardous and a nurse is not available. - Full-time registered nurse - Part-time physician - Part-time dentist - Emergency clinic 201 to 300 workers An emergency clinic shall  be provided regardless of the nature of the undertaking HAZARDOUS WORKPLACE: - Full-time registered nurse - Part-time physician - Part-time dentist - Dental clinic - Infirmary or emergency Over 300 workers hospital with 1 bed capacity for every 100 workers.  NON-HAZARDOUS WORKPLACE: - Full-time registered nurse - Part-time physician - Part-time dentist Note: In all workplaces where there are more than 1 workshift in a day, the employer shall, in addition to the aforesaid requirements, provide the services of full-time first-aider  for each workshift.

Hazardous Workplace: (a) Workers are exposed to dangerous, environmental elements, contaminants or work conditions including radiation, chemicals, fire, flammable substances, noxious components and the like; (b) Workers are engaged in construction work, logging, firefighting, mining, quarrying, blasting, stevedoring, dock work, deep sea fishing and mechanical farming; (c) Workers are engaged in the manufacture or handling of explosive and other pyrotechnic products; (d) Workers are exposed to heavy or power-driven machinery or equipment; or (e) Workers are exposed to power-driven too ls.

ART. 164. When emergency hospital not required. - The requirement for an emergency hospital or dental clinic shall not be applicable in case there is a hospital or dental clinic which is accessible from the employer’s establishment and

he makes arrangement for the reservation therein of the necessary beds and dental facilities for the use of his employees. Requisites: (1) In a written contract; (2) Facilities for transportation; (3) The hospital is 5km away in urban areas or 25mins away in rural areas; and (4) Must still maintain emergency clinics and Family planning clinics.

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LABOR STANDARDS (Atty. Paulino Ungos)

ART. 165. H ealth program. - The physician engaged by an employer shall, in addition to his duties under this Chapter, develop and implement a comprehensive occupational health program for the benefit of the employees of his employer.

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Safety Committee  –  all establishments are required to have a Safety Committee which should be organized within 1 month from the date the business starts operating and should reorganize every January of each year.

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ART. 167. Assistance of employer.  - It shall be the duty of any employer to provide all the necessary assistance to ensure the adequate and immediate medical and dental attendance and treatment to an injured or sick employee in case of emergency.

the DOLE covers all establishments, workplaces, and other undertakings, including agricultural enterprises, whether operating for profit or no t, except to: (a) Those engaged in land, sea and air transportation, except their garages, dry-docks, hangars, maintenance and repair shops and offices; (b) Residential places exclusively devoted to dwelling purposes; and (c) Activities of a lessee regarding safety of mining installations, surface or underground, within the mining claim or lease.

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ART. 166. Qualifications of health personnel.   - The physicians, dentists and nurses employed by employers pursuant to this Chapter shall have the necessary training in industrial medicine and occupational safety and health. The Secretary of Labor and Employment, in consultation with industrial, medical, and occupational safety and health associations, shall establish the qualifications, criteria and conditions of employment of such health personnel.

ART. 168.  Safety and health standards. - The Secretary of Labor and Employment shall, by appropriate orders, set and enforce mandatory occupational safety and health standards to eliminate or reduce occupational safety and health hazards in all workplaces and institute new, and update existing, programs to ensure safe and healthful working conditions in all places of employment.

San Beda College Alabang

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Safety Man: The principal function of the Safety Man is to act as the employer’s assistant and consultant in the application of  programs to remove the hazards from the workplace and to correct unsafe work p ractices.

Q: What are considered as dangerous occurrences? A: (a) Explosion of boilers used for heating or power; (b) Explosion of a receiver or storage container; (c) Bursting of revolving wheel, grinderstone or grinding wheel operated by mechanical power; (d) Collapse of crane, elevator, hoist or other appliances used for raising or lowering persons or goods; (e) Explosion or fire causing damage to the structure of any room; and (f) Electrical short circuit or failure of electrical machinery,  plant or apparatus.

ART. 169. Research. - It shall be the responsibility of the Department of Labor and Employment to conduct continuing studies and research to develop innovative methods, techniques and approaches for dealing with occupational safety and health problems; to discover latent diseases by establishing causal connections between diseases and work in environmental conditions; and to develop medical criteria which will assure insofar as practicable that no employee will suffer impairment or diminution in health, functional capacity, or life expectancy as a result of his work and working conditions.

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ART. 170. Training programs.   - The Department of Labor and Employment shall develop and implement training programs to increase the number and competence of personnel in the field of occupational safety a nd industrial health. Training of Personnel in Safety and Health: (1) In Non-Hazardous Workplace (a) 50 to 400 workers per shift  –  at least one of the supervisors or technical personnel shall be trained and assigned as part-time safety man. (b) Over 400 workers per shift  –  at least two  of its supervisors shall be trained who shall work as   part-time safety man. (2) In Hazardous Workplace (a) 20 to 200 workers per shift  –  at least one  of its supervisors as part time safety man . (b) Over 200 workers per shift  –  at least two  of its supervisors shall be trained who shall work as   full-time safety man. The employment of a full-time safety man may not be required if the employer enters into a written contract with a qualified consulting organization which shall develop and carry out his safety and health activities; provided that the consultant shall conduct plant visits at least 4 hours a week and is subject to call any time to conduct accident investigations and is available during scheduled inspections or surveys by the Secretary of Labor and Employment or his authorized representatives.

ART. 171. Admini stration of safety and health laws. - (a) The Department of Labor and Employment shall be solely responsible for the administration and enforcement of occupational safety and health laws, regulations and standards in all establishments and workplaces wherever they may be located; however, chartered cities may be allowed to conduct industrial safety inspections of establishments within their respective jurisdictions where they have adequate facilities and competent personnel for the purpose as determined by the Department of Labor and Employment and subject to national standards established by the latter. (b) The Secretary of Labor and Employment may, through appropriate regulations, collect reasonable fees for the inspection of steam boilers, pressure vessels and pipings and electrical installations, the test and approval fo r safe use of materials, equipment and other safety devices and the approval of plans for such materials, equipment and devices. The fee so collected shall be deposited in the national treasury to the credit of the occupational safety and health fund and shall be expended exclusively for the administration and enforcement of safety and other labor laws administered by the Department of Labor and Employment. Types of Inspection: Techni cal Safety I nspection  –  refers to inspection for the  purpose of safety determination of boilers, pressure vessels, internal combustion engines, electrical installations, elevators, hoisting equipment and other mechanical equipment. General Safety I nspection  –  refers to inspection of work environment, including the location and operation of machinery other than those covered by technical safety inspection, adequacy of work space, ventilation, lighting, conditions of

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work environment, handling, storage or work procedures,  protection facilities and other safety and health hazards in workplace.

Q: What can the Department of Labor order for violations of labor standard? A: It can order a stoppage of the establishment’s operation and compel the employer at fault to pay his employees their wages during the stoppage.

Title II EMPLOYEES’ COMPENSATION AND STATE INSURANCE FUND

Chapter I POLICY AND DEFINITIONS

ART. 172. Policy.   - The State shall promote and develop a tax-exempt employees’ compensation program whereby employees and their dependents, in the event of work-connected disability or death, may promptly secure adequate income benefit and medical related benefits. Q: What are the benefits under Title II? A: Medical benefit, Temporary total disability benefit, Permanent total disability benefit, Permanent partial disability  benefit, death benefit and Funeral benefit.

Compensability of Disability or Death Arising From Injury For disability or death arising from injury is compensable, the injury must be the result of an employment accident that satisfies all of the following conditions: (a) The employee must have been injured at the place where his work requires him to be; (b) The employee must have been  performing his offi cial  functions; and (c) If the injury is sustained elsewhere, the employee must have  been executing an order  for the employer.

 DOCTRINES:

PERSONAL COMFORT DOCTRINE  –  Acts performed by an employee within the time and space limits of his employment, to minister to his personal comfort, such as satisfaction of his thirst, hunger or other physical demands, or to  protect himself fro m excessive cold, shall be d eemed incidental to his employment and injuries the employee suffered in the  performance o f such acts shall be considered compensable and arising out of and in the course of employment. SPECIAL ENGAGEMENT DOCTRINE  –  Any injury or accident suffered by an employee shall be compensable if it occurred during the period of recreation, where such recreation was officially conducted by the company from which such  person is employed. SHUTTLE BUS DOCTRINE  –  Any injury or accident suffered by an employee while being in the shuttle bus provided  by his or her employee shall be compensable PROVIDED that the trip when the injury incurred was during an official and routine trip.

GOING-TO AND COMING-FROM PLACE OF WORK DOCTRINE –  Injury or death resulting from an accident while the employee is going to, or coming from, the workplace is compensable if the following conditions are definitively established: (a) The act of the employee of going to, or coming from, the workplace must have been a continuing act and he had

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not departed from his usual route to, or from, his workplace; and (b) If the employee was sent on a special errand, the special errand must have been official and in connection with his work. MINGLING OF PURPOSE DOCTRINE  –  When an employee is ordered to perform work outside the workplace and deviates from such directive to attend to some personal concerns, any injury or accident suffered by an employee, even during the period when such employee is attending to his  personal concerns, shall be compensable. 24-FOUR HOUR DUTY DOCTRINE  –  A soldier on active duty status is really on a 24-hour official duty status and is subject to military discipline and military law twenty-four hours a day. He is subject to call and to the orders of his superior officers at all times, seven days a week, except when he is on vacation leave. “INCREASED RISK” DOCTRINE –  Diseases which are not classified as “occupational disease” are compensable only if the claimant can prove that the risk of contracting the disease was increased by the working conditions. WORK-AT-HOME DOCTRINE – When the work allows that an employee to perform his work in the comforts of his home, any injury or accident suffered by such employee is, incidental to and while performing work, shall be compensable. (Lopez v. ECC. 228 SCRA 657. p.530)

Q: Is doing work at home compensable? A: Yes. If made under the discretion of employer. Q: Is death or injury while on vacation leave compensable? A: Death or disability arising from injury sustained by an employee while on vacation leave is not compensable because an employee who is on leave does not perform his usual duties.

Q: Is death or disability arising from illness compensable? A: Death or disability is compensable: (a) if the illness is classified as an occupational disease; or (b) if not classified as an occupational disease, the risk of contracting the same is  proven by substantial evidence to have been increased by the working conditions.

Occupational Diseases: 1. Papiloma of the Bladder 2. Cancer or ulceration of the skin or of the corneal surface of the eye 3. Cataract 4. Deafness 5. Decompression Sickness 6. Dermatitis due to irritants and sensitizers 7. Infections 8. Ionizing Radiation Disease 9. Poisoning 10. Pneumoconioses 11. Diseases caused by abnormalities in temperature and humidity. 12. Vascular disturbances in the upper extremities. 13. Viral Hepatitis

14. Poisoning by Cadmium 15. Leukemia and lymphoma 16. Cancer of the stomach 17. Cancer of the lungs, liver and brain. 18. Cardiovascular disease 19. Cerebrovascular accidents 20. Malaria and Schistosomiasis 21. Pneumonia 22. Hernia 23. Bronchial Asthma 24. Osteoarthritis 25. Viral Encephalitis 26. Peptic Ulcer 27. Pulmonary Tuberculosis 28. Viral Hepatitis 29. Essential Hypertension

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ART. 173. Definition of terms. - As used in this Title, unless the context indicates otherwise: (a) " Code"   means the Labor Code of the Philippines instituted under Presidential Decree Numbered four hundred forty-two, as amended. (b) " Commission"  means the Employees’ Compensation Commission created under this Title. (c) " SSS"   means the Social Security System created under Republic Act Numbered Eleven hundred sixty-one, as amended. (d) " G SI S "    means the Government Service Insurance System created under Commonwealth Act Numbered One hundred eighty-six, as amended. (e) " System" means the SSS or GSIS, as the case may be. (f) " E mployer"   means any person, natural or juridical, employing the services of the employee. (g) " E mployee"  means any person compulsorily covered by the GSIS under Commonwealth Act Numbered One hundred eighty-six, as amended, including the members of the Armed Forces of the Philippines, and any person employed as casual, emergency, temporary, substitute or contractual, or any person compulsorily covered by the SSS under Republic Act Numbered Eleven hundred sixty-one, as amended. (h) " Person"   means any individual, partnership, firm, association, trust, corporation or legal representative thereof. (i) " Dependent"   means the legitimate, legitimated or legally adopted or acknowledged natural child who is unmarried, not gainfully employed, and not over twenty-one (21) years of age or over twenty-one (21) years of age provided he is incapacitated and incapable of self-support due to a physical or mental defect which is congenital or acquired during minority; the legitimate spouse living with the employee and the parents of said employee wholly dependent upon him for regular support. (j) " Beneficiari es"   means the dependent spouse until he/she remarries and dependent children, who are the primary beneficiaries. In their absence, the dependent parents and subject to the restrictions imposed on dependent children, the illegitimate children and legitimate descendants, who are the secondary beneficiaries: Provided, That the dependent acknowledged natural child shall be considered as a primary beneficiary when there are no other dependent children who are qualified and eligible for monthly income benefit. (k) " I njury"  means any harmful change in the human organism from any accident arising out of and in the course of the employment. (l) " Sickness"   means any illness definitely accepted as an occupational disease listed by the Commission, or any illness caused by employment subject to proof that the risk of contracting the same is increased by working conditions. For this purpose, the Commission is empowered to determine and approve occupational diseases and workrelated illnesses that may be considered compensable based on peculiar hazards of employment. (m) " Death"  means loss of life resulting from injury or sickness.  (n) " Di sability"  means loss or impairment of a physical or mental function resulting from injury or sickness.

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(o) " Compensation"   means all payments made under this Title for income benefits and medical or related benefits. (p) " I ncome benefi t"   means all payments made under this Title to the providers of medical care, rehabilitation services and hospital care. (q) " Medical benefi t"  means all payments made under this Title to the providers of medical care, rehabilitation services and hospital care. (r) " Related benefit"   means all payments made under this Title for appliances and supplies. (s) " Appliances"   means crutches, artificial aids and other similar devices. (t) " Supplies"   means medicine and other medical, dental or surgical items. (u) " H ospital"  means any medical facility, government or private, authorized by law, an active member in good standing of the Philippine Hospital Association and accredited by the Commission. (v) " Physician"   means any doctor of medicine duly licensed to practice in the Philippines, an active member in good standing of the Philippine Medical Association and accredited by the Commission. (w) " Wages"  or " Salary" , insofar as they refer to the computation of benefits defined in Republic Act No. 1161, as amended, for SSS and Presidential Decree No. 1146, as amended, for GSIS, respectively, except that part in excess of Three Thousand Pesos. (x) " Monthly salary credit"   means the wage or salary base for contributions as provided in Republic Act Numbered Eleven hundred sixty-one, as amended, or the wages or salary. (y) " Average monthly salary credit"   in the case of the SSS means the result obtained by dividing the sum of the monthly salary credits in the sixty-month period immediately following the semester of death or permanent disability by sixty (60), except where the month of death or permanent disability falls within eighteen (18) calendar months from the month of coverage, in which case, it is the result obtained by dividing the sum of all monthly salary credits paid prior to the month of contingency by the total number of calendar months of coverage in the same period. (z) " Average daily salary credit"  in the case of the SSS means the result obtained by dividing the sum of the six (6) highest monthly salary credits in the twelve-month period immediately preceding the semester of sickness or injury by one hundred eighty (180), except where the month of injury falls within twelve (12) calendar months from the first month of coverage, in which case it is the result obtained by dividing the sum of all monthly salary credits by thirty (30) times the number of calendar months of coverage in the period. In the case of the GSIS, the average daily salary credit shall be the actual daily salary or wage, or the monthly salary or wage divided by the actual number of working days of the month of contingency. (aa) " Quarter"  means a period of three (3) consecutive months ending on the last days of March, June, September and December. (bb) " Semester"   means a period of two consecutive quarters ending in the quarter of death, permanent disability, injury or sickness. (cc) " Replacement ratio" - The sum of twenty percent and the quotient obtained by dividing three hundred by the

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sum of three hundred forty and the average monthly salary credit. (dd) " Credited years of service" - For a member covered prior to January, 1975, nineteen hundred seventy-five minus the calendar year of coverage, plus the number of calendar years in which six or more contributions have been paid from January, 1975 up to the calendar year containing the semester prior to the contingency. For a member covered on or after January, 1975, the number of calendar years in which six or more contributions have been paid from the year of coverage up to the calendar year containing the semester prior to the contingency. (ee) " Monthly i ncome benefi t"   means the amount equivalent to one hundred fifteen percent of the sum of the average monthly salary credit multiplied by the replacement ratio, and one and a half percent of the average monthly salary credit for each credited year of service in excess of ten years: Provided, That the monthly income benefit shall in no case be less than two hundred fifty pesos. Chapter II COVERAGE AND LIABILITY

 ART. 174. Compulsory coverage.  - Coverage in the State

Insurance Fund shall be compulsory upon all employers and their employees not over sixty (60) years of age: Provided, That an employee who is over (60) years of age and paying contributions to qualify for the retirement or life insurance benefit administered by the System shall be subject to compulsory coverage. Covered Employees. All employees not over 60 years old, whether belonging to the public or private sector, are covered. Employees who are over 60 years old are covered if they have  been paying contributions to the SSS or GSIS.

Public Sector Employees are those covered by the Government Service Insurance System.

Private Sector Employees are those who are covered by the Social Security System.

Coverage of Filipinos Working Abroad  –  Filipinos working abroad for an employer who carries on in the Philippines any trade, business, industry, undertaking or activity of any kind are covered, and therefore, entitled to the same benefits given to employees working in the Philippines.

ART. 175. F oreign employment. - The Commission shall ensure adequate coverage of Filipino employees employed abroad, subject to regulations as it may prescribe. ART. 176. E ff ective date of coverage.  - Compulsory coverage of the employer during the effectivity of this Title shall take effect on the first day of his operation, and that of the employee, on the date of his employment.  ART. 177. Registration.  - Each employer and his

employees shall register with the System in accordance with its regulations.

The procedure for registration is set forth in Section 2, Rule II of the Amended Rules on Employees’ Compensation which reads: SEC. 2. GSIS.  –  The following guidelines shall apply to the public sector:

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(1) Every employer operating before January 1, 1975 shall register not later than March 31, 1975; (2) Every employer operating on or after January 1, 1975 shall register within one month from the first day of operation; and (3) Every employee shall be registered through his employer within one month from the date of employment.

Q: When is an employee deemed reported? A: An employee is deemed reported for coverage if the SSS or GSIS has received a report or written communication about him from his employer and Employee’s Compensation contribution paid in his name  before a compensable contingency occurs.

Q: What is the effect of failure to report an employee? A: Failure on the part of the employer to report his employee for coverage shall be penalized as follows: (1) In case of failure or refusal to register employees, the employer or responsible official who committed the violation shall be punished with fine of no t less than P1,000 nor more than P10,000 and/or imprisonment for the duration of the violation or non-compliance or until such time that rectification of the violation has been made; (2) In case of compensable contingency occurs after 30 days from employment and before the System receives any report, his employer shall be liable to the System for the lump sum equivalent to the benefits to which he or his dependents may be entitled.

 ART. 178. Limitation of liability.  - The State Insurance

Fund shall be liable for compensation to the employee or his dependents, except when the disability or death was occasioned by the employee’s intoxication, willful intention

to injure or kill himself or another, notorious negligence, or otherwise provided under this Title. Factors That Bar Compensability (a) Intoxication; (b) Willful intention to injure or kill himself or another; or (c) Gross negligence.

Intoxication –  refers to a person’s condition in being under the influence of liquor or prohibited drugs to the extent that his acts, words or conduct is impaired visibly, as to prevent him from  physically and mentally engaging in the duties of his employment. To constitute a ground for denial of compensation, the degree of intoxication must be such that it rendered the employee incapable of doing his work. The accident or injury must be shown by clear and convincing proof that it arose out of his drunken condition. It is incumbent upon the party invoking drunkenness as a defense to show that the employee was extremely drunk. Although intoxication may be a contributory cause to his injury, it must be shown that the intoxication was the proximate cause of death or injury and the burden of proof lies on h im who raises drunkenness as a defense.

Willful Intention to Injure/Kill Himself or Another A disability or death not caused by the employment but by the employee’s own voluntary act. The compensation applies only to work-connected injury, sickness, disability or death.

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Notorious Negligence  Notorious negligence is something more than mere or simple negligence or contributory negligence. It signifies a deliberate act of the employee to disregard his own personal safety. It is more than mere carelessness or lack of foresight. It is failure to observe any or slight care. It is tantamount to gross negligence. Disobedience to rules, orders, and/or prohibition does not per se constitute notorious negligence, if no intention can be attributed to the injured to end his life.  Notorious negligence is exemplified by a seaman who jumps into the sea to retrieve a 2-peso bill, as a result of which he was drowned. But an employee who inadvertently placed his left hand on a paper cutting machine which he thought at the time was not working as a result of which, four of his fingers were cut, is not guilty of notorious negligence because the employee acted in a casual manner in which anyone might have acted under similar conditions.

ART. 179. E xtent of liability. - Unless otherwise provided, the liability of the State Insurance Fund under this Title shall be exclusive and in place of all other liabilities of the employer to the employee, his dependents or anyone otherwise entitled to receive damages on behalf of the employee or his dependents. The payment of compensation under this Title shall not bar the recovery of benefits as provided for in Section 699 of the Revised Administrative Code, Republic Act Numbered Eleven hundred sixty-one, as amended, Republic Act Numbered Forty-eight hundred sixty-four as amended, and other laws whose benefits are administered by the System or by other agencies of the government. (As amended by Presidential Decree No. 1921). Q: Can the injured employee avail of the compensation benefits under the Labor Code and sue the employer for damages under the Civil Code? A: [F irst View ] The injured employee (or his heirs, in case of death) may initiate an action for damages (not compensation under the Workmen’s Compensation Act) on the basis of negligence of the employer pursuant to the Civil Code. [ Second View] The remedy of an employee for work-connected injury or accident is exclusively restricted to seeking the limited compensation provided under the Workmen’s Compensation Act. [Third V iew ] The employee or his heirs can choose on whether to avail of the limited compensation under th e Workmen’s Compensation Act or sue for higher damages under the Civil Code by reason of the employer’s negligence. But once the choice has been made, the employee or his heris can no longer opt for the other remedy.

Distinction Between Compensation and Damages. Compensation is given to mitigate the harshness and insecurity of industrial life for the workman and his family. So long as the death, injury or illness is wok-connected, entitlement to compensation exists, regardless of the negligence of the employer. Damages are given in order to vindicate a wrongful invasion of a right. It is recoverable by a person by a person who has sustained injury either in person, property or relative rights, through the act or default of another.

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ART. 180. Liability of third party/ies.   - (a) When the disability or death is caused by circumstances creating a legal liability against a third party, the disabled employee or the dependents, in case of his death, shall be paid by the System under this Title. In case benefit is paid under this Title, the System shall be subrogated to the rights of the disabled employee or the dependents, in case of his death, in accordance with the general law. (b) Where the System recovers from such third party damages in excess of those paid or allowed under this Title, such excess shall be delivered to the disabled employee or other persons entitled thereto, after deducting the cost of proceedings and expenses of the System. Third Party refers to any person who is not the employer of the injured employee. A co-employee would be considered a third party.

Q: Is injury or death caused by a third party compensable? A: Yes. If all the requisites for compensability are met. However, the claimant cannot receive payment twice for the same injury.

Compensability of Disability or Death Arising From Injury For disability or death arising from injury is compensable, the injury must be the result of an employment accident that satisfies all of the following conditions: (a) The employee must have been injured at the place where his work requires him to be; (b) The employee must have been  performing his offi cial  functions; and (c) If the injury is sustained elsewhere, the employee must have  been executing an order  for the employer.

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members, one of whom shall represent the employees and the other, the employers, to be appointed by the President of the Philippines for a term of six years. The appointive member shall have at least five years experience in workmen’s compensation or social security programs. All vacancies shall be filled for the unexpired term only. (As amended by Section 19 [c], Executive Order No. 126).

(b) The Vice Chairman of the Commission shall be alternated each year between the GSIS General Manager and the SSS Administrator. The presence of four members shall constitute a quorum. Each member shall receive a  per diem of two hundred pesos for every meeting that is actually attended by him, exclusive of actual, ordinary and necessary travel and representation expenses. In his absence, any member may designate an official of the institution he serves on full-time basis as his representative to act in his behalf. (As amended by Section 2, Presidential Decree No. 1368) . (c) The general conduct of the operations and management functions of the GSIS or SSS under this Title shall be vested in its respective chief executive officers, who shall be immediately responsible for carrying out the policies of the Commission. (d) The Commission shall have the status and category of a government corporation, and it is hereby deemed attached to the Department of Labor and Employment for policy coordination and guidance. (As amended by Section 2, Presidential Decree No. 1368) .

Compensation Commission is hereby created to be composed of five ex-officio members, namely: the Secretary of Labor and Employment as Chairman, the GSIS General Manager, the SSS Administrator, the Chairman of the Philippine Medical Care Commission, and the Executive Director of the ECC Secretariat, and two appointive

ART. 183. Powers and duties. - The Commission shall have the following powers and duties: (a) To assess and fix a rate of contribution from all employers; (b) To determine the rate of contribution payable by an employer whose records show a high frequency of work accidents or occupational diseases due to failure by the said employer to observe adequate safety measures; (c) To approve rules and regulations governing the processing of claims and the settlement of disputes arising therefrom as prescribed by the Sy stem; (d) To initiate policies and programs toward adequate occupational health and safety and accident prevention in the working environment, rehabilitation other than those provided for under Article 190 hereof, and other related programs and activities, and to appropriate funds therefor; (As amended by Section 3, Presidential Decree No. 1368). (e) To make the necessary actuarial studies and calculations concerning the grant of constant help and income benefits for permanent disability or death and the rationalization of the benefits for permanent disability and death under the Title with benefits payable by the System for similar contingencies: Provided, That the Commission may upgrade benefits and add new ones subject to approval of the President: and Provided, further, That the actuarial stability of the State Insurance Fund shall be guaranteed: Provided, finally, That such increases in benefits shall not require any increases in contribution, except as provided for in paragraph (b) hereof; (As amended by Section 3, Presidential Decree No. 1641). (f) To appoint the personnel of its staff, subject to civil service law and rules, but exempt from WAPCO law and regulations; (g) To adopt annually a budget of expenditures of the Commission and its staff chargeable against the State Insurance Fund: Provided, That the SSS and GSIS shall

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ART. 181. Deprivation of the benefits. - Except as otherwise provided under this Title, no contract, regulation or device whatsoever shall operate to deprive the employee or his dependents of any part of the income benefits and medical or related services granted under this Title. Existing medical services being provided by the employer shall be maintained and continued to be enjoyed by their employees. Q:

What

are

the benefits under Compensation Law? (Bar Question)

the

Employees’

A: The benefits under the employees’ compensation law are in the form of income or services, and consist of the following: (a) Medical services, appliances and supplies; (b) Rehabilitation services; (c) Permanent total disability; (d) Permanent partial disability; (e) Death; and (f) Funeral.

Chapter III ADMINISTRATION

ART. 182.  Employees’ Compensation Commission.  - (a) To initiate, rationalize, and coordinate the policies of the employees’

compensation

program,

the

Employees’

LABOR STANDARDS (Atty. Paulino Ungos)

advance on a quarterly basis, the remittances of allotment of the loading fund for the Commission’s operational expenses

based on its annual budget as duly approved by the Department of Budget and Management; (As amended by Section 3, Presidential Decree No. 1921). (h) To have the power to administer oath and affirmation, and to issue subpoena and subpoena duces tecum in connection with any question or issue arising from appealed cases under this Title; (i) To sue and be sued in court; (j) To acquire property, real or personal, which may be necessary or expedient for the attainment of the purposes of this Title; (k) To enter into agreements or contracts for such services and as may be needed for the proper, efficient and stable administration of the program; (l) To perform such other acts as it may deem appropriate for the attainment of the purposes of the Commission and proper enforcement of the provisions of this Title. (As amended by Section 18, Presidential Decree No. 850). ART. 184.  Management of funds.  - All revenues collected by the System under this Title shall be deposited, invested, administered and disbursed in the same manner and under the same conditions, requirements and safeguards as provided by Republic Act Numbered eleven hundred sixty-one, as amended, with regard to such other funds as are thereunder being paid to or collected by the SSS and GSIS, respectively: Provided, That the Commission, SSS and GSIS may disburse each year not more than twelve percent of the contribution and investment earnings collected for operational expenses, including occupational health and safety programs, incidental to the carrying out of this Title. ART. 185. I nvestment of funds. - Provisions of existing laws to the contrary notwithstanding, all revenues as are not needed to meet current operational expenses under this Title shall be accumulated in a fund to be known as the State Insurance Fund, which shall be used exclusively for pay ment of the benefits under this Title, and no amount thereof shall be used for any other purpose. All amounts accruing to the State Insurance Fund, which is hereby established in the SSS and GSIS, respectively, shall be deposited with any authorized depository bank approved by the Commission, or invested with due and prudent regard for the liquidity needs of the System. (As amended by Section 4, Presidential Decree  No. 1368)

ART. 186. Settlement of claims. - The System shall have original and exclusive jurisdiction to settle any dispute arising from this Title with respect to coverage, entitlement to benefits, collection and payment of contributions and penalties thereon, or any other matter related thereto, subject to appeal to the Commission, which shall decide appealed cases within twenty (20) working days from the submission of the evidence. ART. 187. Review. - Decisions, orders or resolutions of the Commission may be reviewed on certiorari   by the Supreme Court on question of law upon petition of an aggrieved party within ten (10) days fro m notice thereof.

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ART. 188. E nforcement of decisi ons. - (a) Any decision, order or resolution of the Commission shall become final and executory if no appeal is taken therefrom within ten (10) days from notice thereof. All awards granted by the Commission in cases appealed from decisions of the System shall be effected within fifteen days from receipt of notice. (b) In all other cases, decisions, orders and resolutions of the Commission which have become final and executory shall be enforced and executed in the same manner as decisions of the Court of First Instance, and the Commission shall have the power to issue to the city or provincial sheriff or to the sheriff whom it may appoint, such writs of execution as may be necessary for the enforcement of such decisions, orders or resolutions, and any person who shall fail or refuse to comply therewith shall, upon application by the Commission, be punished by the proper court for contempt. Chapter IV CONTRIBUTIONS

ART. 189.  Employers’ contributions. - (a) Under such regulations as the System may prescribe, beginning as of the last day of the month when an employee’s compulsory

coverage takes effect and every month thereafter during his employment, his employer shall prepare to remit to the System a contribution equivalent to one percent of his monthly salary credit. b) The rate of contribution shall be reviewed periodically and subject to the limitations herein provided, may be revised as the experience in risk, cost of administration and actual or anticipated as well as unexpected losses, may require. (c) Contributions under this Title shall be paid in their entirety by the employer and any contract or device for the deductions of any portion thereof from the wages or salaries of the employees shall be null and void. (d) When a covered employee dies, becomes disabled or is separated from employment, his employer’s obligation to

pay the monthly contribution arising from that employment shall cease at the end of the month of contingency and during such months that he is not receiving wages or salary. Payment of Premium Contributions  –   Sole Obligation of Employer The obligation to pay premium contributions for employees’ compensation is the sole obligation of the employer. Any contract or device for the deduction of any portion thereof from the wages is null and void. The contributions required are nonrefundable.

Effect of Death or Separation from Employment When a covered employee dies during employment or is separated from employment, his employer’s o bligation to pay the monthly contribution shall cease on the last day of the month of the contingency.

Effect of Disability When a covered employee becomes disabled during employment, his employer’s obligation to pay the monthly contribution arising from that employment shall be suspended during the months that he is not receiving salary or wages.

ART. 190. Government guarantee.  - The Republic of the Philippines guarantees the benefits prescribed under this Title, and accepts general responsibility for the solvency of Page 44

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the State Insurance Fund. In case of any deficiency, the same shall be covered by supplemental appropriations from the national government.

employment, including assistance as may be within its resources, to help each rehabilitee to develop his mental, vocational or social potential.

Chapter V

Rehabilitation is the process by which there is provided a  balanced program of remedial treatment, vocational assessment, and preparation designed to meet the individual needs of each handicapped employee to restore him to suitable employment, including assistance as may be within its resources to help each rehabilitee to develop his mental, vocational, or social potential.

MEDICAL BENEFITS

 ART. 191.  Medical services.  - Immediately after an

employee contracts sickness or sustains an injury, he shall be provided by the System during the subsequent period of his disability with such medical services and appliances as the nature of his sickness or injury and progress of his recovery may require, subject to the expense limitation prescribed by the Commission.

ART. 192. Liability.   - The System shall have the authority to choose or order a change of physician, hospital or rehabilitation facility for the employee, and shall not be liable for compensation for any aggravation of the employee’s injury or sickness resulting from unauthorized

changes by the employee of medical services, appliances, supplies, hospitals, rehabilitation facilities or physicians. ART. 193.  Attending physician.  - Any physician attending an injured or sick employee shall comply with all the regulations of the System and submit reports in prescribed forms at such time as may be required concerning his condition or treatment. All medical information relevant to the particular injury or sickness shall, on demand, be made available to the employee or the System. No information developed in connection with treatment or examination for which compensation is sought shall be considered as privileged communication. ART. 194. Refusal of examination or treatment. - If the employee unreasonably refuses to submit to medical examination or treatment, the System shall stop the payment of further compensation during such time as such refusal continues. What constitutes an unreasonable refusal shall be determined by the System which may, on its own initiative, determine the necessity, character and sufficiency of any medical services furnished or to be furnished. ART. 195. F ees and other charges. - All fees and other charges for hospital services, medical care and appliances, including professional fees, shall not be higher than those prevailing in wards of hospitals for similar services to injured or sick persons in general and shall be subject to the regulations of the Commission. Professional fees shall only be appreciably higher than those prescribed under Republic Act Numbered sixty-one hundred eleven, as amended, otherwise known as the Philippine Medical Care Act of 1969.  ART. 196. Rehabili tation services. - (a) The System shall,

as soon as practicable, establish a continuing program, for the rehabilitation of injured and handicapped employees who shall be entitled to rehabilitation services, which shall consist of medical, surgical or hospital treatment, including appliances if they have been handicapped by the injury, to help them become physically independent. (b) As soon as practicable, the System shall establish centers equipped and staffed to provide a balanced program of remedial treatment, vocational assessment and preparation designed to meet the individual needs of each handicapped employee to restore him to suitable

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Conditions for Entitlement (a) He has been reported  to the SSS or the GSIS; (b) He sustains a  permanent disabili ty   as a result of a compensable injury or sickness; and (c) He has not been p laced in suitable employment .

Period of Entitlement Rehabilitation services shall be provided during the period of disability unless suspended or terminated under the following grounds: (a) Upon suitable employment; (b) Upon suspension or termination of such services; or (c) by self-termination.

Limitation (a) Intoxication (b) Willful Intention; or (c) Notorious negligence

Chapter VI DISABILITY BENEFITS

ART. 197. Temporary total disability. - (a) Under such regulations as the Commission may approve, any employee under this Title who sustains an injury or contracts sickness resulting in temporary total disability shall, for each day of such a disability or fraction thereof, be paid by the System an income benefit equivalent to ninety percent of his average daily salary credit, subject to the following conditions: the daily income benefit shall not be less than Ten Pesos nor more than Ninety Pesos, nor paid for a continuous period longer than one hundred twenty days, except as otherwise provided for in the Rules, and the System shall be notified of the injury or sickness. (b) The payment of such income benefit shall be in accordance with the regulations of the Commission. Temporary total disability is the healing time or that period of time in which the claimant employee, by reason of the injury or sickness, is unable to perform any kind o f labor.

Q: When is a disability total and temporary? A: (a) If as a result of the injury or sickness, the employee is unable to perform any gainful occupation for a continuous  period not exceeding 120 days; or (b) If the injury or sickness still requires medical attendance  beyond 120 days bu t not to exceed 240 days fro m the onset o f the disability.

Q: What if it exceeds 240 days? A: If the claimant is still sick and unable to report for work as established by proper medical examination, the disability shall  be considered permanent and total.

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Q: Is it the injury that is compensated? A: No. It is not the injury that is compensated, but the incapacity to work resulting in the impairment of one’s earning capacity.

Conditions for entitlement (a) The employee should have been duly reported   to the SSS or the GSIS; (b) The employee  sustains the temporary total disabili ty   as a result of the injury or sickness; and (c) The SSS or the GSIS has been duly notified  of the injury or sickness which caused his d isability.

 ART. 198. Permanent total disability. - (a) Under such

regulations as the Commission may approve, any employee under this Title who contracts sickness or sustains an injury resulting in his permanent total disability shall, for each month until his death, be paid by the System during such a disability, an amount equivalent to the monthly income benefit, plus ten percent thereof for each dependent child, but not exceeding five, beginning with the youngest and without substitution: Provided, That the monthly income benefit shall be the new amount of the monthly benefit for all covered pensioners, effective upon approval of this Decree. (b) The monthly income benefit shall be guaranteed for five years, and shall be suspended if the employee is gainfully employed, or recovers from his permanent total disability, or fails to present himself for examination at least once a year upon notice by the System, except as otherwise provided for in other laws, decrees, orders or Letters of Instructions. (c) The following disabilities shall be deemed total and permanent: (1) Temporary total disability lasting continuously for more than one hundred twenty days, except as otherwise provided for in the Rules;  (2) Complete loss of sight of both eyes; (3) Loss of two limbs at or above the ankle or wrist; (4) Permanent complete paralysis of tw o limbs; (5) Brain injury resulting in incurable imbecility or insanity; and (6) Such cases as determined by the Medical Director of the System and approved by the Commission. (d) The number of months of paid coverage shall be defined and approximated by a formula to be approved by the Commission. ART. 199. Permanent partial disability. - (a) Under such regulations as the Commission may approve, any employee under this Title who contracts sickness or sustains an injury resulting in permanent partial disability shall, for each month not exceeding the period designated herein, be paid by the System during such a disability an income benefit for permanent total disability. (b) The benefit shall be paid for not more than the period designated in the following schedules: Complete and permanent loss of the use of 

One thumb One index finger One middle finger

No. of Months

-

10 8 6

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One ring finger One little finger One big toe One toe One arm One hand One foot One leg One ear Both ears Hearing of one ear Hearing of both ears Sight of one eye

-

5 3 6 3 50 39 31 46 10 20 10 50 25

(c) A loss of a wrist shall be considered as a loss of the hand, and a loss of an elbow shall be considered as a loss of the arm. A loss of an ankle shall be considered as loss of a foot, and a loss of a knee shall be considered as a loss of the leg. A loss of more than one joint shall be considered as a loss of one-half of the whole finger or toe: Provided, That such a loss shall be either the functional loss of the use or physical loss of the member. (d) In case of permanent partial disability less than the total loss of the member specified in the preceding paragraph, the same monthly income benefit shall be paid for a portion of the period established for the total loss of t he member in accordance with the proportion that the partial loss bears to the total loss. If the result is a decimal fraction, the same shall be rounded off to the next higher integer. (e) In cases of simultaneous loss of more than one member or a part thereof as specified in this Article, the same monthly income benefit shall be paid for a period equivalent to the sum of the periods established for the loss of the member or the part thereof. If the result is a decimal fraction, the same shall be rounded off to the next higher integer. (f) In cases of injuries or illnesses resulting in a permanent partial disability not listed in the preceding schedule, the benefit shall be an income benefit equivalent to the percentage of the permanent loss of the capacity to w ork. (g) Under such regulations as the Commission may approve, the income benefit payable in case of permanent partial disability may be paid in monthly pension or in lump sum if the period covered does not exceed one year. Permanent Partial Disability is when the employee sufers a lasting partial loss of the use of any part of his body as a result of injury or sickness.

Conditions to entitlement (a) The employee should have been reported to the SSS or the GSIS; (b) He sustains permanent partial disability as a result of injury or sickness; and (c) The SSS or the GSIS has been duly notified of the injury or sickness which caused his d isability.

Chapter VII DEATH BENEFITS

ART. 200. Death. - (a) Under such regulations as the Commission may approve, the System shall pay to the primary beneficiaries upon the death of the covered employee under this Title, an amount equivalent to his Page 46

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monthly income benefit, plus ten percent thereof for each dependent child, but not exceeding five, beginning with the youngest and without substitution, except as provided for in paragraph (j) of Article 167 hereof: Provided, however, That the monthly income benefit shall be guaranteed for five years: Provided, further, That if he has no primary beneficiary, the System shall pay to his secondary beneficiaries the monthly income benefit but not to exceed sixty months: Provided, finally, That the minimum death benefit shall not be less than fifteen thousand pesos. (b) Under such regulations as the Commission may approve, the System shall pay to the primary beneficiaries upon the death of a covered employee who is under permanent total disability under this Title, eighty percent of the monthly income benefit and his dependents to the dependents’ pension: Provided, That the marriage must

have been validly subsisting at the time of disability: Provided, further, That if he has no primary beneficiary, the System shall pay to his secondary beneficiaries the monthly pension excluding the dependents’ pension, of the remaining

balance of the five-year guaranteed period: Provided, finally, That the minimum death benefit shall not be less than fifteen thousand pesos. (c) The monthly income benefit provided herein shall be the new amount of the monthly income benefit for the surviving beneficiaries upon the approval of this decree. (d) F uneral benefi t.  - A funeral benefit of Three thousand pesos (P3,000.00) shall be paid upon the death of a covered employee or permanently totally disabled pensioner. Entitlement to Death Benefits The rule is that only the primary beneficiaries are entitled to death benefits. In the absence of primary beneficiaries, the secondary beneficiaries are entitled to the death benefit. If the deceased employee has no primary or secondary beneficiaries at the time of death, the death benefit shall accrue to the Employee’s Compensation Fund.

Q: Who are primary beneficiaries? A: The primary beneficiaries are: (a) The legitimate spouse living with the employee at the time of the employee’s death, until he or she marries; and (b) The legitimate, legitimated or legally adopted children who are: (i) unmarried; (ii) not gainfully employed; and (iii) not over 21 years old; or if over 21 years old, he is incapable of self-support due to physical or mental defect which is congenital or acquired during minority.

Q: Who are secondary beneficiaries? A: The secondary beneficiaries are: (a) The legitimate parents wholly dependent upon the employee for support; (b) The legitimate descendents and illegitimate children who are: (i) unmarried; (ii) not gainfully employed; and (iii) not over 21 years old; or if over 21 years old, he is incapable of self-support due to physical or mental defect which is congenital or acquired during minority.

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Policy on Surviving Spouse General Rule: The surviving spouse is entitled to the benefit only if he or she is living with the deceased employee at the time of death. Exceptions: Even if the surviving spouse is not living with the deceased employee at the time of death, the spouse may still be entitled to death benefits if because: ( PAPAS need LAB PASS) (1) Refusal of the covered employee to continue living with the surviving spouse; or the employee’s  Abandonment   of the said spouse without justifiable or valid cause; (2)  Attempt  on the part o f the covered employee against the life of the surviving spouse or common child of the spouse; (3) Commission of an act of  Sexual abuse  against the surviving spouse, common child of the spouse by the covered employee; (4) The covered employee’s recurrent commission of Physical violence, or grossly Abusive conduct   against the surviving spouse or common child of th e spouse; (5) The covered employee’s infliction of Physi cal vi olence, or imposition of moral duress to compel the surviving spouse, common child of the spouse to change their religious or  political affiliation; (6) Attempt of the covered employee to corrupt or induce the surviving spouse or common child of the spouse to engage in Prostitution , or to make them connive with the employee in such act of corruption or inducement; (7) Drug addiction  or habitual alcoholism of the covered employee; (8) Lesbianism or homosexuality of the covered employee; (9) Contraction of Bigamous marriage  by the covered employee, whether in the Philippines or abroad; (10) Sexual infi delity  or perversion of the covered employee; (11) The covered employee’s act of allowing the surviving spouse or common child to be subjected to  Acts of lasciviousness ; and (12) The covered employee’s act of contraction of serious  Sexually transmitted disease extramaritally.

Conditions for entitlement: (a) The employee has been duly reported to the SSS or the GSIS; (b) He died as a result of an injury or sickness; and (c) The SSS or GSIS has been duly notified of his death, as well as the injury or sickness which caused his d eath.

Period for Entitlement The income benefit shall start at the month of death and shall continue to be paid for as long as the beneficiaries are entitled thereto. The monthly income benefit which in no case shall be less than P15,000, shall be guaranteed for 5 years. Thereafter, the beneficiaries shall be paid the monthly income benefit for as long as they are entitled thereto. In case of secondary beneficiaries, the income benefit which is payable in monthly pension, shall not exceed the period of 60 months and the aggregate income benefit shall not be less than P15,000.

Death Benefit in Case of Presumptive Death If one is declared presumptively dead, payment of benefit shall be reckoned from the date he was declared presumptively dead except when the declaration of death specifies another date, in which case, payment of death benefits shall start from the latter date.

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Amount of Death Benefit For Primary Beneficiaries Period –  Guaranteed for 5 years Minimum Amount –  Not less than P15,000 Amount: - Equivalent to monthly income benefit for permanent disability. - If the employee has been receiving income benefits for  permanent total disability at the time of his death, the primary  beneficiaries shall be paid the monthly income benefit equivalent to 80%. Additional Benefits - Plus 10% for each dependent child not exceeding 5 children beginning with the youngest, and without substitution.

Secondary Beneficiaries Period –  Guaranteed for 5 years Minimum Amount –   60 times the monthly income of a primary  beneficiary which in no case be less than P15,000 Amount: - Equivalent to monthly income benefit for permanent disability. - If the employee has been receiving monthly income benefits for permanent total disability at the time of his death, the secondary beneficiaries shall be paid the monthly pension, excluding the dependent’s pension of the remaining balance of the five year guaranteed period. Additional Benefits - Plus 10% for each dependent child not exceeding 5 children beginning with the youngest, and without substitution.

Funeral Benefit The funeral benefit of P3,000 shall be paid upon the death of a covered employee or permanently disabled pensioner to one of the following: (a) Surviving spouse; or (b) Legitimate child who spent for the funeral expenses; or (c) Any other person who can show incontrovertible proof that he shouldered the funeral expenses.

Q: Can the employee recover from the Labor Law and Special Law (SSS)? A: No. He must choose only one. Q: Can an employee avail benefit and vacation leave? A: Yes. The benefit and vacation leave are two separate and distinct from each other.

Q: What are these benefits? A: Medical, Disability, Death and Funeral Benefits. Q: Can the employee avail of the benefit and sue for damages? A: No. Q: What if there are two “legal” wives? A: The spouse was not granted the benefit because there is a  presumption that he was not living with his legal wife.

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Q: Are there any exceptions to that? A: The spouse may still avail of the benefits even if there are n ot living together: PROVIDED, the surviving spouse was abandoned, or there was an attempt against the surviving spouse’s life, sexually abused, or any grounds for legal separation.

Chapter VIII PROVISIONS COMMON TO INCOME BENEFITS

ART. 201.  Relationship and dependency.  - All questions of relationship and dependency shall be determined as of the time of death. Q: What does the w ord “dependent” mean? A: Dependent means: (a) The legitimate, legitimated or legally adopted children who are: (i) unmarried; (ii) not gainfully employed; and (iii) not over 21 years old; or if over 21 years old, he is incapable of self-support due to physical or mental defect which is congenital or acquired during minority; (b) The legitimate spouse living with the employee at the time of the employee’s death, until he or she marries; and (c) The parents of said employee wholly dependent upon him for regular support.

ART. 202.  Delinquent contributions. - (a) An employer who is delinquent in his contributions shall be liable to the System for the benefits which may have been paid by the System to his employees or their dependents, and any benefit and expenses to which such employer is liable shall constitute a lien on all his property, real or personal, which is hereby declared to be preferred to any credit, except taxes. The payment by the employer of the lump sum equivalent of such liability shall absolve him from the payment of the delinquent contribution and penalty thereon with respect to the employee concerned. (b) Failure or refusal of the employer to pay or remit the contribution herein prescribed shall not prejudice the right of the employee or his dependents to the benefits under this Title. If the sickness, injury, disability or death occurs before the System receives any report of the name of his employee, the employer shall be liable to the System for the lump sum equivalent to the benefits to which such employee or his dependents may be entitled. ART. 203. Second injuries.  - If any employee under permanent partial disability suffers another injury which results in a compensable disability greater than the previous injury, the State Insurance Fund shall be liable for the income benefit of the new disability: Provided, That if the new disability is related to the previous disability, the System shall be liable only for the difference in income benefits. Comepensability of Second Injuries Second injury resulting in disability which may be suffered  by an employee under permanent partial disability, is compensable. If the second injury is greater than the previous injury, the State Insurance Fund shall be liable for the income benefit of the new disability. If the new injury is related to the previous one, the liability is only for the d ifference in income benefits.

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ART. 204.  Assig nment of benefits.  - No claim for compensation under this Title is transferable or liable to tax, attachment, garnishment, levy or seizure by or under any legal process whatsoever, either before or after receipt by the person or persons entitled thereto, except to pay any debt of the employee to the System. Restrictions on Compensation Benefits (a) Non-transferable; (b) Not subject to tax; and (c) Not subject to execution, attachment, garnishment, levy, or seizure, except in payment of a debt to the System.

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dependent notifies the System of his claim prior to the payments. (b) In case of doubt as to the respective rights of rival claimants, the System is hereby empowered to determine as to whom payments should be made in accordance with such regulations as the Commission may approve. If the money is payable to a minor or incompetent, payment shall be made by the System to such person or persons as it may consider to be best qualified to take care and dispose of the minor’s or incompetent’s property for his benef it.

Q: Can accrued employee benefits under a contract or CBA be enjoyed simultaneously with employee compensation benefits? A: Yes, because they are separate and distinct from each other.

ART. 209. Prohibition.   - No agent, attorney or other person pursuing or in charge of the preparation or filing of any claim for benefit under this Title shall demand or charge for his services any fee, and any stipulation to the contrary shall be null and void. The retention or deduction of any amount from any benefit granted under this Title for the payment of fees for such services is prohibited. Violation of any provision of this Article shall be punished by a fine of not less than five hundred pesos nor more than five thousand pesos, or imprisonment for not less than six months nor more than one year, or both, at the discretion of the court.

Q: What if the employee gains employment while being compensated for permanent total disability? A: The compensation shall be suspended.

Q: What are the prohibited acts contemplated under this Article? A: Demanding or charging service fees; or deducting any

ART. 205. E arned benefits. - Income benefits shall, with respect to any period of disability, be payable in accordance with this Title to an employee who is entitled to receive wages, salaries or allowances for holidays, vacation or sick leaves and any other award of benefit under a collective bargaining or other agreement.

Q: How about if the employee is suffering from permanent  partial disability? A: The employee shall continue to receive compensation  benefits even if he is gainfully employed.

ART. 206. Safety devices. - In case the employee’s injury or death was due to the failure of the employer to comply with any law or to install and maintain safety devices or to take other precautions for the prevention of injury, said employer shall pay the State Insurance Fund a penalty of twenty-five percent (25%) of the lump sum equivalent of the income benefit payable by the System to the employee. All employers, specially those who should have been paying a rate of contribution higher than required of them under this Title, are enjoined to undertake and strengthen measures for the occupational health and safety of t heir employees. ART. 207. Prescriptive period.   - 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. Q: When should an employee file his claim from compensation? A: Within 3 years from the time the cause of action accrued.

amount from the compensation benefit in payment of services.

ART. 210. E xemption fr om levy, tax, etc. - All laws to the contrary notwithstanding, the State Insurance Fund and all its assets shall be exempt from any tax, fee, charge, levy, or customs or import duty and no law hereafter enacted shall apply to the State Insurance Fund unless it is provided therein that the same is applicable by expressly stating its name. Chapter IX RECORDS, REPORTS AND PENAL PROVISIONS

ART. 211. Record of death or disability.  - (a) All employers shall keep a logbook to record chronologically the sickness, injury or death of their employees, setting forth therein their names, dates and places of the contingency, nature of the contingency and absences. Entries in the logbook shall be made within five days from notice or knowledge of the occurrence of the contingency. Within five days after entry in the logbook, the employer shall report to the System only those contingencies he deems to be workconnected. (b) All entries in the employer’s logbook shall be made by the employer or any of his authorized official after verification of the contingencies or the employees’ absences

Q: Or is it from the time of the occurrence of his injury or illness? A: No. From the time the employee lost his earning capacity.

for a period of a day or more. Upon request by the System, the employer shall furnish the necessary certificate regarding information about any contingency appearing in the logbook, citing the entry number, page number and date. Such logbook shall be made available for inspection to the duly authorized representative of the System.

ART. 208. E rroneous payment.  - (a) If the System in good faith pays income benefit to a dependent who is inferior in right to another dependent or with whom another dependent is entitled to share, such payments shall discharge the System from liability, unless and until such other

(c) Should any employer fail to record in the logbook an actual sickness, injury or death of any of his employees within the period prescribed herein, give false information or withhold material information already in his possession, he shall be held liable for fifty percent of the lump sum

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Q: When does the cause of action arise? A: From the time the employee lost his earning capacity.