ARELLANO LAW FOUNDATION

CENTER FOR LEGAL EDUCATION

AND RESEARCH

BAR REVIEW
PROGRAM

Pre-Week Reviewer in

LABOR
LAW

LABOR STANDARDS
a.

What is recruitment and placement?

"Recruitment and Placement" means any act of canvassing, enlisting, contracting, transporting, utilizing,
hiring or procuring workers, and which includes referrals, contract services, promising or advertising for
employment, locally or abroad, whether for profit or not. Provided, that any person or entity which, in any
manner, offers or promises for a fee employment to two or more persons shall be deemed engaged in
recruitment and placement. (Article 13(b), Labor Code)
b.

X Cruise Lines terminated its Crewing Ageement with Y Agency on October 3, 1996, to
take effect on December 31, 1996, and appointed Z Agency as new crewing agent.
Pending approval of the accreditation from the POEA on its new manning agent, foreign
principals of X Cruise nLines cames to the Philippines and conducted interviews for the
seafarers as Z Agencys office for deployment in January 1997. This was repoted to the
POEA by Y Agency, whcih subsquently filed a complaint for illegal recruitment. Z
Manning Agency argues that it was only upon approval of its accreditation that the
employment contracts were entered into and actual deployment of the seamen was
made; and X Cruise Lines officers could have conducted the alleged activities of
interviewing, and selecting and hiring crewmen without license. Is Z Manning Agency
liable for illegal recruitment?

Yes. The conduct of preparatory interviews is a recruitment activity. Prior to the approval of the transfer of
accreditation, no recruitment or deployment may be made by the principal by itself or the would-be
transferee manning agency as this would constitute illegal recruitment by a non-holder of authority.
Direct hiring by employers of Filipino workers for overseas employment is banned; they can only do so
through, among others, licensed private recruitment and shipping/ manning agencies. (C.F. Sharp Crew
Management, Inc., vs. Hon. Usec Jose Espanol, Jr., Hon. Sec. Leonardo A. Quisumbing and Rizal
International Shipping Services, G.R. No. 155903, Sept. 14, 2007)
c.

What is the Country-Team Approach?

This concept, as stated in the Migrant Workers Act, means tah all officers, representatives and personnel
of the Philippine government working abroad, regardless of their mother agencies shall on a per country
basis, act as one country-team with a mission under the leadership of the ambassador.
d.

May an OFM acquire regularity of employment?

No, they can never become regular employees because their employment contract is for a fixed term.
(Millares, et al vs. NLRC, G. R. No 110524, July 29, 2002) Further, an OFW cannot be considered a regular
employee notwithstanding the fact that the work he performs is necessary and desirable in the business of
the company. (Gu-Miro vs. Adorable, GR No. 160952, August 20, 2004)

2010 LABOR LAW

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e.

What are the requisites for valid payment of wages through checks?

Payment of wages by bank checks, postal or money orders is allowed under the following circumstances:
a. Such manner of wage payment is customary on the date of the effectivity of the Labor Code or
b. It is stipulated in do not the CBA or
c. All the conditions are met:
1. There is a bank facility for encashment within a 1 km radius from the work place.
2. The employer, his agents or representatives do not recieve any pecuniary benefits directly or
indirectly form the arrangement.
3. The employees are given reasonable time during banking hours to withdraw their wages from the
bank, which shall be considered compensable hours worked if done during working hours, and
4. Written consent of the employees if there is no collective agreement authorizing such. ( Sec. 2,
Rule VIII, Book III, Rules Implementing the Labor Code)

f.

Distinguish between Name Hiring and Direct Hiring in overseas employment.

Name hires are individual workers who are able to secure contracts for overseas employment on their own
efforts and representation without the assistance or participation of any agency. Their employment
contracts and documents are processed by POEA. Direct hiring involves the employment of individual
workers directly by foreign employers without coursing their job orders through POEA or through private
employment agencies. There is an existing ban on direct hiring with the exception of those whose
employment were secured through:
a)
b)
c)
d)

g.

Name hires
Members of the diplomatic corps
International organization
Such other employers as may be allowed by POEA

What is the duration of the license to recruit?

A license is valid for a period of four (4) years from the date of issuance unless sooner cancelled, revoked
or suspended by the POEA for violation of the Labor Code or its Implementing Rules and Regulations.
(Rule II(6), Book I, Omnibus Rules Implementing the Labor Code)

h.

How should the monetary claims of OFWs be computed?

In case of termination of overseas employment without just, valid or authorized cause as defined by law
or contract, workers shall be entitled to full reimbursement of his placement fee with interest of twelve
percent (12%) per annum, plus his salaries for the unexpired portion of his employment contract. (See.
10, R.A. 8042)
Note: There is no more distinction as to which amount to award an illegally dismissed overseas worker
whether his contract is for at least one year or less than a year.
The rule laid down in Marsaman Manning Agency v. NLRC (1999) was abandoned by the Supreme Court in
Antonio M Serrano vs. Gallant Maritime Services, Inc., at at., G.R. No. 157614, March 24, 2009, when it
DECLARED UNCONSTlTUTIONAL the clause "or for three months for every year of the unexpired term,
whichever is less" in the 5th paragraph of Section 10 of RA No. 8042.

i.

Can illegal recruitment be committed by a licensed recruitment agency?

Section 6 of the Migrant workers Act of 1995 (RA 8042), illegal recruitment may be committed by any
reason regardless of whether or not he is a non-licensee, non-holder, licensee or holder of authority for
acts such as overexaction of placement fee, publishing false information, engaging in recruitment or
placement of workers in jobs harmful to public health or morality, contract, substitution, withholding of
travel documents from applicants before departure for monetary or financial considerations, failure to
actually deploy workers for valid reasons and failure to reimburse expenses incurred by the worker in
connection with his documentation and processing for purposes of deployment in cases where deployment
does not actually take place without the workers fault.

j.

What is the duration and validity of Alien Employment Permit?

Except in cases of pre-arranged employment requiring a short period of employment, an employment

permit issued to a non-resident alien shall be valid for one (1) year from date of issue. Such permit shall
be renewed upon approval by the Regional Director. Within forty-five (45) days prior to the expiration of
the permit, an application for extension of the same can actually be filed.

k.

Differentiate Apprenticeship from Learnership.

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Differences

APPRENTICESHIP
training

for

LEARNERSHIP

Duration

Practical
months

to

Practical training for not more

than 3 months

Applicability

Highly skilled jobs or in highly

technical industries

Semi-skilled
occupations

Employers commitment

No commitment to hire
apprentice after training

the

With commitment to hire the

learner as reg. employee if he
desires after training

Effect of pretermination

In case of pre-termination of the

agreement, the apprentice is NOT
considered as a regular employee

In case of pre-termination of the

agreement,
the
learner
is
considered
as
a
regular
employee provided: it be after 2
months of training and the
dismissal is not due to the fault
to the learner

Necessity of DOLE approval

Necessary as to what occupations

are apprenticeable

NOT necessary but agreements

are subject to DOLEs inspection

or

industrial

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l.

Who are not covered by holiday pay?

The following are not covered by holiday pay:

a.
b.
c.
d.
e.

m.

Those of the government and any of the political subdivisions, including government owned and
controlled corporation.
Those of retail and service establishments regularly employing less than ten (10) workers
Domestic helpers and persons in the personal service of another.
Managerial employees
Field personnel and other employees whose time and performance is unsupervised by Me
employer including those who are engaged on task or contract basis, purely commission basis or
those who are paid a fixed amount for performing work, irrespective of the time consumed in the
performance thereof. (Art.94 of LC, see also Handbook on Worker's Statutory Monetary Benefits,
p.19)

A manufacturing firm with 500 employees schedules Sunday as their rest day. Fifty
workers who were Seventh-Day Adventists and 200 workers who belong to the Iglesia
ni Kristo object and propose that their rest days be scheduled on Saturdays and
Thursdays, respectively. The company claims that the proposed schedule will seriously
prejudice or obstruct its manufacturing operations and refuses to re-schedule the rest
days requested.

n.

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o.

Do the Seventh-Day Adventists and members of the Iglesia ni Kristo have any right to
choose their own rest days?

p.

Assuming that the claim of the employer is well founded, can it legally refuse to reschedule the rest day of the employees involved?

q.
r.

a. YES. The employer, under the law, is required to respect the preference of the
employee if the same is based on religious grounds. The employee shall make known
his preference to the employer in writing at least (7) days before the desired effectivity
of the initial rest day preferred. (Section 4, Rule IN, Book I of the Implementing Rules
and Regulations)

s.

b) YES. If the employer cannot resort to other remedial measures it may schedule the
rest days of the employees involved on the days of their choice for at least 2 days in a
month (Section 4. Rule lll, Book lll of the Implementing Rules and Regulations).

t.
u.

14. Is job contracting or subcontracting illegal?

v.

NO, provided the requirements for legitimate job contracting or subcontracting are
satisfied and the prohibition against labor only contracting or subcontracting is
observed. The requisites of legitimate subcontracting are as follows:

w.

a. The contractor or subcontractor carries on a distinct and independent business and

undertakes to perform the job, work or service on its own account and under its own
responsibility, according to its own manner and method, and free from the control and
direction of the principal in all matters connected with the performance of the work
except to the results thereof;
.

x.
y.

b. The contractor or subcontractor has substantial capital or investment;

z.

c. The agreement between the capital and the contractor or subcontractor assures the
contractual employees entitlement to all occupational safety and health standards, free
exercise of the right to self organization, security of tenure, and social and welfare
benefits. (Vinoy vs. NLRC, G. R. No. 126586, February 2, 2000, and Lim vs. NLRC, G. R.
124630, February 19, 1999)

aa.
bb.

15. What is wage distortion?

cc.
dd.

A wage distortion shall a situation where an increase in prescribed wage totes results
in the elimination or severe contraction of intentional quantitative differences in wage
or salary rates between and among employee group in an establishment as to
effectively obliterate the distinctions embodied in such wage structure based on skills,
length of service or other logical bases of differentiation. (Art. 124, Labor Code)

ee.

It is not required that there be a complete obliteration of the wage differences. It is

enough that there is a severe contraction of the same. (Metrobank Employees Union vs.
NLRC)

ff.
gg.
hh.

16. How should Wage Distortion be settled?

ii.

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jj.

In organized establishments, wage distortion shall be resolved through the grievance

procedure under their CBA, and if remains unresolved, through voluntary arbitration.

kk.

In establishments where there are no CBAs or recognized labor unions, the employers
and workers shall endaevor to correct such distortion. Any dispute arising therefrom
shall be settled through the NCMB, and if remains unresolved after ten (10) calendar
days of conciliation, it shall be referred to the appropriate branch of the NLRC for
compulsory arbitration. (Art. 124)

ll.
mm.
nn.

17. In the event of bankruptcy or liquidation of an employer's business, which between

mortgagee and employee's money claim would prevail?

oo.

As a general rule; the order of preference is as follows:

pp.

1. workers

qq.

2. state

rr.

3. other creditors.

ss.

A mortgagee's claim is superior to a worker's preference, for preference of credit

applies only to claims which do not attach to specific properties.

tt.

However, if there is a formal declaration of bankruptcy or judicial liquidation; mortgage

credits are subordinate to a worker's claim. The State can also claim far taxes has a
special preference in relation to Article 2241 of the Civil Code.

uu.
vv.

18. RMC employees, to satisfy a judgment in their favor, filed a notice of levy on
execution against the properties of' its employer annotating in its certificate of title
while DBP obtained a writ of possession over RMC's property after judicial foreclosure.
The writ of possession prevented the execution in favour of the RMC employees. The
labor arbiter ruled in favor of the RMC employees on the basis of Article 110 of the
Labor Code giving worker's preference. Is the Labor arbiter correct?

ww.
xx.

No, in the absence of a declaration of bankruptcy or judicial liquidation of RMC, the

employees cannot enforce first preference in the satisfaction of their claims over those
of DBP. It is clear form the provisions that a declaration of bankruptcy or a judicial
liquidation must be present before the workers preference may be enforced. Thus,
Article 110 of the Labor Code cannot be invoked by the labor arbiter in this case absent
a formal declaration of bankruptcy or a liquidation order. (DBP vs. Hon. Labor Arbiter
Ariel Santos, GR No. 78261-62, March 8, 9989)

yy.
zz.
aaa.

19. Premiere Bank, a banking corporation, being the creditor mortgagee of XYZ and
Co., a garment firm, foreclosed the hypothecated assets of the latter. Despite the
foreclosure, XYZ & Co. continued its business operations. A year, the bank took
possession of the foreclosure property. The garment firm's businesses operations
ceased without a. declaration of bankruptcy. Jose Gaspar, an employee of XYZ & Co.,
was dismissed from employment due to the cessation of business of the firm. He filed a
complaint against XYZ 7 Co. and the Bank. The Labor Arbiter, after hearing so found
the company liable, as claimed by Jose Gaspar for separation pay. Premier Bank was
additionally found subsidiary liable upon the thesis that the satisfaction of labor
benefits due to the employee is superior to the right of mortgage of property. Was the
Labor Arbiter correct in his decision?

bbb.
ccc.

No. The preference of credits established in Art. 110 of the Labor Code cannot be
invoked in the absence of any insolvency proceedings declared of bankruptcy, judicial
liquidation. (DBP vs. Santos, 171 SCRA 938 [1989].

ddd.

The decision of the Labor Arbiter holding Premiere Dank (as foreclosing mortgageecreditor) subsidiary liable in the money obligations of XYZ & Co, (as mortgagor) to
Gaspar, its employee, has no legal basis.

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eee.

There is no privity of relationship between the Bank and Gaspar. The relationship, upon
which the obligation to pay a sum of money is based, is between XYZ (the mortgagor)
and Gaspar as its employee arising the Labor Code provision requiring an employer to
pay separation pay, re: bother cause employment.

fff.

At both times - Labor Arbiter Decision to pay separation pay and foreclosure - XYZ. &
Co. was an existing business entity and neither bankrupt or in liquidation, although its
business operations after the foreclosure ceased.

ggg.

The decision of the Labor Arbiter for XYZ & Co. to pay a sum of money to Gaspar was
based on an action in personam, riot in mm, enforceable against any party. (Sundower
Corporation vs. Drilon, 180, SCRA 94 [1989])

hhh.

The reference in the Decision to "labor benefits due to an employee is superior to the
right of a mortgagee of property" is misplaced. The preferential claim rule has no. basis
runs contrary to law and jurisprudence

iii.
jjj.
kkk.

20. When may an employer terminate a probationary employee?

lll.
mmm. The Labor Code (in Art. 281) provides that the services of an employee who has been
engaged on a probationary basis may be terminated for a just cause or when he fails to
qualify as a regular employee in accordance with reasonable standards made known by
the employer to the employee at the time of his engagement. If the probationary
employee is being terminated for just cause, he must of course, be given due process
before his termination. (Article 281, Labor Code)
nnn.
ooo.

21. Distinguish between dismissal of an employee for just cause and termination of
employment for authorized cause. Enumerate examples of just cause and authorized
cause.

ppp.

Dismissal for a just cause is founded on faults or misdeeds of the employee. Separation
pay, as a rule, will not be paid. Examples: serious misconduct, willful disobedience,
commission of crime, gross and habitual neglect, fraud and other causes analogous to
the foregoing. (Art. 282, Labor Code).

qqq.

Termination for authorized causes are based on business exigencies or measures

adopted by the employer, not constituting faults of the employee.

rrr.

Payment of separation pay at varying amounts is required. Examples: redundancy,

closure, retrenchment, installation of labor saving device and authorized cause. (Art.
283-284, Labor Code).

sss.
ttt.

22. An airline which flies both international and domestic routes requested the
Secretary of Labor and Employment to approve the policy that all female flight
attendants upon reaching age forty (4Q) with at least fifteen (15) years of service shall
be compulsorily retired. However, flight attendants who have reached age forty (40)
but have not worked for fifteen (15) years will be allowed to continue working in order
to qualify for retirement benefits, but in no case will the extension exceed four (4)
years.

uuu.

Does the Secretary of Labor and Employment have the authority to approve the policy?

vvv.
www.

Yes, the Secretary of Labor and Employment has the authority to approve a policy
dealing with the retirement of flight attendants of airlines.

xxx.

Article 132 (d) of the Labor Code provides that the Secretary of Labor and Employment
shall establish standards that will ensure the safety and health of women employees,
including the authority to determine appropriate minimum age and other standards for
retirement or termination In special occupations such as those of flight attendants and
the like.

yyy.

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zzz.

23. The Company As legal counsel advised the Board of Directors as follows: "A
company cannot retrench to prevent losses until actual losses occur.
The
Company
must wait until the end of the Business Year when
its Books of Accounts, Profit
and Loss Statement showing the actual loss and Balance Sheet have been audited by
an independent auditing firm."

aaaa.

Is the legal advice of counsel correct?

bbbb.
cccc.

The legal advice is not correct. The Labor Code (in Article 283) provides that retrenchment may be resorted to "to prevent losses" Thus there could be legal basis for
retrenchment even before actual losses as long as the losses are imminent and serious.

dddd.
eeee.
ffff.

24. What is the principle of codetermination?

gggg.
hhhh.

The principle of codetermination is one which grants to the workers the right to
participate in policy and decision-making processes affecting their rights and benefits.
(Art. 255, Labor Code)

iiii.
jjjj.
kkkk.

25. What is Brent School Doctrine?

llll.

There is nothing essentially contradictory between a definite period of an employment

contract and the nature of the employees duties set down in the contract as being
usually necessary or desirable in the usual business or trade of the employer.

mmmm.
This applies to employment contracts to which a fixed term is an essential and
natural appurtenance: overseas employment contracts, for one, to which, whatever the
nature of the engagement, the concept of regular employment with all that it implies
does not appear ever to have been applied, Art. 280 of the Labor Code
notwithstanding; also appointments to the positions of dean, college secretary,
principal and other administrative offices in educational institutions, which are by
practice or tradition rotated among the faculty members, and where fixed terms are a
necessity without which no reasonable rotation would be possible. (Brent School, Inc.
vs. Zamora, G.R. No.48494, February 5, 1990; AMA Computer College, Paraaque, et al.
vs. Austria, G.R. No. 164078, November 23, 2007)
nnnn.
oooo.

26. What are the requisites for the Brent ruling to apply?

pppp.

Term employment cannot be said to be in circumvention of the law on security of

tenure where:

qqqq.

The fixed period of employment was knowingly and voluntarily agreed upon by the
parties without any force, duress or improper pressure being brought to bear upon the
employee and absent of any other circumstances vitiating his consent; or

rrrr.

It satisfactorily appears that the employer and employee dealt with each other on more
or less equal terms with no moral dominance whatever being exercised by the former
over the latter. (Brent School, Inc. vs. Zamora, G.R. No.48494, February 5, 1990)

ssss.

27. What cases fall under the grievance machinery?

tttt.

Any grievance arising from:

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uuuu.

The interpretation or implementation of the Collective Bargaining Agreement (CBA);

and

vvvv.

The interpretation or implementation of company personnel policies.

wwww. Note that all grievances submitted to the grievance machinery, which are not settled
within seven (7) calendar days from the date of its submission, shall automatically be
referred to voluntary arbitration as prescribed in the CBA.
xxxx.

28. What is the power to assume jurisdiction or certify national interest labor
disputes to the NLRC?

yyyy.

When, in his opinion, there exists a labor dispute causing or likely to cause a strike or
lockout in an industry indispensable to the national interest, the Secretary of Labor and
Employment may assume jurisdiction over the dispute and decide it or certify the same
to the Commission for compulsory arbitration. Such assumption or certification shall
have the effect of automatically enjoining the intended or impending strike or lockout
as specified in the assumption or certification order. If one has already taken place, all
striking or locked out employees shall immediately return to work and the employer
shall immediately resume operations and readmit all workers under the same terms
and conditions prevailing before the strike or lockout. The Secretary of labor and
Employment or the Commission may seek the assistance of law enforcement agencies
to ensure compliance with this provision as well as with such orders as he may issue to
enforce the same. (Art. 263[g], Labor Code)

zzzz.
aaaaa. 29. What is the substitutionary doctrine?
bbbbb. The term substitutionary doctrine means that the employees are not allowed to
revoke the CBA validly executed with their employer by reason of the change in the
bargaining agent during the effectivity thereof. The new bargaining agent should
respect the CBAs validity and binding effect. It may, however, negotiate for the
shortening of the lifetime of the CBA. (Elisco-Elirol Labor Union vs. Noriel, G.R. No.
41955, December 29, 1997)
ccccc.
ddddd. 30. Bagot University refused to pay
Jenna, a full-time professor, her salaries during
semestral breaks. The University argues that its action is lawfully based on the No
work no pay policy. Decide.
eeeee.
fffff.

The no work no pay policy does not apply during semestral breaks. The policy
contemplates a scenario where an employee voluntarily absents himself from work.
Here, Jennas absence is not voluntary. She is constrained to take a mandatory leave
from work. (L-63122, Univ. Of Pangasinan Faculty Union vs. Univ Of Pangasinan, Feb
20, 1984)

ggggg.
hhhhh. 31. Employees of ABC Company are made to work continuously for two shifts, each for
eight hours. The company, however, credited only 6 hours for overtime pay claiming
that the decrease of compensable time is based on the meal periods given to the
employees. The employees maintain that they should receive an 8 hour credit. Decide.
iiiii.
jjjjj.

The work being continuous, the meal breaks should be counted as working time for
purposes of overtime compensation. The employees should be credited sixteen hours
when they work in two shifts. (L-15422, 11-30-62)

kkkkk.
lllll.

32. ABC Corporation employed Manny as a motor operator in its factory. Manny,
however, opts to waive his right to overtime pay in exchange of a monthly rate 5 times
their daily wage, 3 day off and other privileges of a regular employee. Later, Manny
claims that under the law, the right to overtime pay cannot be waived and he deserves
to be paid more. Decide.

mmmmm.
nnnnn. When the alleged waiver of overtime pay is in consideration of benefits and privileges
which may be more than what will accrue to them in overtime pay, the waiver may be
permitted as an exemption. (L-11876, May 29, 1959)
ooooo.

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ppppp. 33. ABC Company refused non-Muslim employees their holiday pay on Muslim holidays
as provided by law. Is the refusal valid?
qqqqq.
rrrrr.

No. Muslim and Christian employees are entitled to holiday pay on Muslim holidays.
Wages and emoluments granted by law to the working man are determined on the
basis of the criteria laid down by laws and certainly not on the basis of the workers
religion.

sssss.
ttttt.
uuuuu. 34. BAGOT Corporation hired 30 OFW accountants as tellers in Hongkong. After 2 years
of enjoying full benefits of regular employees, the corporation retained 20 employees
and 10 are made to go home. The 10 OFWs filed suit against Ansio. Will the case
prosper?
vvvvv. Yes, they are regular employees and must enjoy security of tenure, a right safeguarded
by the Constitution.
wwwww.

No, OFWs never become regular employees because they have fixed contracts.

xxxxx. Yes, it is a cardinal rule that the constitution is superior over the contract signed
between Ansio and the 10 employees.
yyyyy. No, the accountants acting as tellers perform acts necessary to the business of Ansio
Banking Co.
zzzzz.
aaaaaa. 35. In December 1993, Jimmy sold all his belongings to pay the placement fee required
by Mandys Agency for her to travel and work abroad. Upon payment in March 1994,
however, he learned that Mandys Agency is a member of a drug syndicate. When will
his right to bring action prescribe?
bbbbbb.

1999

cccccc. 2000
dddddd.

2009

eeeeee. 2013
ffffff.
gggggg.

The regular holidays contemplated by law are:

hhhhhh.
A. National Heroes Day, All Saints Day, Good Friday, Independence
Day, Eidul Fitr, Araw ng Kagitingan, Bonifacio Day, Christmas Day, New Years Day,
Labor Day, Rizal Day.
iiiiii.

B. New Years Day, Eidul Fitr, Good Friday, Maundy Thursday, Ninoy Aquino
Day, Christmas Day, Bonifacio Day, Rizal Day, Labor Day, National Heroes Day, Araw ng
Kagitingan.

jjjjjj.

C. Independence Day, National Heroes Day, Labor Day, Araw ng Kagitingan,

Bonifacio Day, Rizal Day, Christmas Day, Maundy Thursday, Eidul Fitr, Good Friday,
New Years Day.

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kkkkkk.

D. New Years Day , Independence Day, National Heroes Day, Good Friday,
Eidul Fitr, Christmas Day, National Heroes Day, All Souls Day, Rizal Day, Bonifacio Day,
Araw ng Kagitingan.

llllll.
mmmmmm.
36. ABC Corporations manager caught Johnny, a security guard, sleeping on
duty. The Agency then dismissed Johnny despite his 5 years of working very hard even
on weekends and overtime without pay. Johnny filed a complaint for illegal dismissal
against ABC Corporation. Will the case prosper?
nnnnnn.
Yes, under the law, ABC Corporation is principally liable for the due payment
entitled to Johnny.
oooooo.Yes, ABC Corporation is the employer of Johnny for five years straight and the Agency
is only subsidiarily liable.
pppppp.

No, the Agency is the employer of Jimmy.

qqqqqq.

No, ABC Corporation is the employer of Jimmy.

rrrrrr.
ssssss. 37. What is surface bargaining?
tttttt.

It is the process of going through the motions of negotiating without any legal intent
to reach an agreement. It involves the question of whether or not the employers
conduct demonstrates an unwillingness to bargain in good faith or is merely hard
bargaining.

uuuuuu.

38. What is Zipper Clause?

vvvvvv. It is a stipulation in the CBA indicating that issues that could have been negotiated
upon but not contained in the CBA cannot be raised for negotiation when the CBA is
already in effect.
wwwwww.

xxxxxx. What are the requisites for perfection of appeal?

The requisites for perfection of appeal are the following:
a. the appeal should be filed within the reglementary period;
b. the Memorandum of Appeal should be under oath;
c. payment of appeal fee;
d. posting of cash or surety bond, if judgment involves monetary award; and
e. proof of service to the adverse party.
yyyyyy. What is the concept of unfair labor practice?
An unfair labor practice act violates the right of workers to self-organization, is inimical to the legitimate
interests of both labor and management, including their right to bargain collectively and otherwise deal
with each other in an atmosphere of freedom and mutual respect, disrupts industrial peace and hinders
the promotion of healthy and stable labor-management relations. (Art. 248, Labor Code)
zzzzzz. When is an employer-employee relationship deemed to exist?
The factors to be considered in determining the existence of employer-employee relationship are:
(a) the selection and engagement of the employee;
(b) the payment of wages;
(c) the power of dismissal; and
(d) the employers power to control the employee with respect to the means and method by which the
work is to be accomplished (control test).
aaaaaaa.

What is control test?

Under the control test, there is an employer-employee relationship when the person for whom the services
are performed reserves the right to control not only the end achieved but also the manner and means
used to achieve that end. (TAPE, Inc. and Tuviera vs ROBERTO C. SERVAA (G.R. No. 167648, January
28, 2008)

bbbbbbb.

What is totality of conduct doctrine?

Expressions of opinion by an employer, though innocent in themselves, may be held to be constitutive of

unfair labor practice because of the circumstances under which they were uttered, the history of the
particular employers labor relations or anti-union bias or because of their connection with an established
collateral plan of coercion or interference. An expression which might be permissibly uttered by one
employer, might, in the mouth of a more hostile employer, be deemed improper and consequently
actionable as an unfair labor practice. (Samahan ng Manggagawa sa Bandolino-LMLC vs. NLRC, 275 SCRA
633)

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ccccccc.What is yellow-dog contract?
An agreement which exacts from workers as a condition of employment that they shall not join or belong
to a labor organization, or attempt to organize one; during their period of employment or that they shall
withdraw therefrom, in case they are already members of a labor organization. (Art. 248-b, LC)

160.

What is union security clause?

A stipulation in the CBA whereby the management recognizes that the membership of employees in the
union which negotiated said agreement should be maintained and continued as a condition for
employment or retention of employment.

161.

What are the classifications of union security clause?

a.
b.
c.
d.
e.
f.
g.
h.

162.

Closed shop agreement an undertaking by the employer not to hire or employ any person who is
not a member of the bargaining union.
Maintenance of membership agreement stipulation that employees who are not member of the
bargaining union at the time of the execution of the CBA, are not in any manner bound to become
members of the bargaining union.
Union shop agreement employer is given the freedom to hire and employ any person who is not a
member of the bargaining union.
Modified union shop agreement employees who are not union members at the time of the
signing or execution of the CBA are not required to join the union.
Exclusive bargaining agreement the union which negotiated and concluded the CBA with
management is considered and recognized as the sole and exclusive bargaining agent of all the
covered employees in the bargaining unit, whether they be members or not of the said agent.
Bargaining for members only agreement the union which negotiated and concluded the CBA
with management is recognized as the bargaining agent only for its own members.
Agency shop agreement there is no requirement for non-members of the bargaining union to
become members thereof.
Preferential hiring agreement employer gives preference to hiring the members of the
bargaining union under equal circumstances and qualifications.

What are the requisites for termination based on union security clause?
(1) the union security clause is applicable;
(2) the union is requesting for the enforcement of the union security provision in the CBA; and
(3) there is sufficient evidence to support the unions decision to expel the employee from the union.
(Alabang Country Club, Inc. vs. NLRC, [G.R. No. 170287, Feb. 14, 2008])
ggggggg.

What is a runaway shop?

An industrial plant moved by its owners from one location to another to escape union labor regulations or
state laws. It may also be a relocation motivated by anti-union animus rather than for business reasons.
164.

What is feather-bedding?
It is ULP for a labor organization, its officers, agents or representatives to cause or attempt to cause an
employer to pay or deliver or agree to pay or deliver any money or other things of value, in the nature of
an exaction, for services which are not performed or not to be performed, including the demand for fee for
union negotiations. (Art. 249-d, LC)
iiiiiii.

What is grievance machinery?

It is a mechanism for the adjustment and resolution of grievances arising from the interpretation or
implementation of a CBA and those arising from the interpretation or enforcement of company personnel
policies. It is part of the continuing process of collective bargaining.

jjjjjjj.

What are the cases falling under the jurisdiction of the Grievance Machinery?

1. interpretation or implementation of CBA; and

2. interpretation or enforcement of company personnel policies.

167.

What is voluntary arbitration?

It is a mode of settling labor-management disputes by which the parties select a competent, trained and
impartial third person who shall decide on the merits of the case and whose decision is final and
executory. (Section 1 [d], Rule II, NCMB Revised Procedural Guidelines in the Conduct of Voluntary
Arbitration Proceedings [Oct. 15, 2004]).
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lllllll.

What are the distinctions between regular holidays and special days?

Regular Holiday
Worked:
Paid 200% of his regular daily wage
Not Worked:
Paid 100% of his regular daily wage

mmmmmmm.

Special Holiday
Worked:
Paid of additional compensation of 30%; and
Paid of additional 50% if falls on his rest day.
Not Worked:
No work, no pay rule

May a wage distortion be a valid ground for staging a strike?

No, the existence of wage distortion is not a valid ground for a strike because Art. 124 of the Labor Code
provides for a specific method of procedure for correcting wage distortion. Ilaw at Buklod ng Manggagawa
vs. NLRC, 198 SCRA 586

nnnnnnn.

How should a wage distortion be resolved?

(1) in case there is a CBA?

It shall be resolved through the grievance machinery provided in the CBA, and if remains unresolved,
through voluntary arbitration.
(2) in case there is no CBA?
The employers and workers shall endeavor to correct such distortions. Otherwise, it shall be settled
through the NCMB. If it remains unresolved after ten (10) calendar days, it shall be referred to the NLRC.
ooooooo.
What are the effects of the assumption of power by the Secretary of Labor
and/or the President?

Automatically enjoins the intended or impending strike or lockout as specified in the assumption
or certification order.

If one has already taken place at the time of assumption or certification, all striking or locked out
employees shall immediately return-to-work and the employer shall immediately resume
operations and readmit all workers under the same terms and conditions prevailing before the
strike or lockout. (Article 263,g of the Labor Code)

ppppppp.

What is the effect of the assumption of power by the Sec. of Labor or President
in case there is a strike or lockout in hospitals, clinics and similar medical institutions?

Within 24 hours from knowledge of the occurrence of such strike or lockout, the Sec. of Labor or the
President may assume jurisdiction over the same or certify it to the Commission for compulsory
arbitration.
qqqqqqq.
What is the procedure for inspection by the Secretary of Labor over
recruitment agencies?

conducted during office hours by a team of at least two (2) duly authorized inspectors, in the
presence of the manager of the office or any office personnel (Sec. 5 [a,b], Rule IV, Book II,
Rules and Regulations Governing Overseas Employment).
Inspection reports submitted to the POEA within 24 hours after inspection (Sec. 5 [c], Rule IV,
Book II, Ibid).
Violations found shall constitute grounds for imposition of appropriate sanctions or for the denial
of application for issuance and renewal of license (Sec. 6, Rule IV, Book II, Ibid).

rrrrrrr. When does a casual employee become a regular employee?

a.

Casual employee becomes regular after one year of service by operation of law.
The status of regular employment attaches to the casual worker on the day immediately after the
end of the first year of service. (Kay Products, Inc. vs. CA, G. R. No. 162472, July 28, 2005).

b.

Repeated rehiring-- If the employee has been performing the job for at least one year,
even if the performance is not continuous or merely intermittent, the law deems the repeated and
continuing need for its performance as sufficient evidence of the necessity if not indispensability of
that activity to the business. Hence, the employment is also considered regular but only with
respect to such activity and while such activity exists. (Tan vs. Lagrama, G. R. No. 151228, Aug.
15, 2002).

sssssss.

When may a project employee become regular employee?

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1.
When there is a continuous (as opposed to intermittent) rehiring of
project employees even after cessation of a project for the same tasks or nature of tasks; and
2.
When the tasks performed by the alleged project employee are vital,
necessary and indispensable to the usual business or trade of the employer. (Imbuido vs. NLRC, G. R. No.
114734, March 31, 2000).
ttttttt. Distinguish termination of employment of project and regular employees?
The services of project employees are coterminous with the project and may be terminated upon the end
or completion of the project for which they were hired.
Regular employees, in contrast, are legally entitled to remain in the service of their employer until that
service is terminated by one or another of the recognized modes of termination of service under the Labor
Code.
(Magcalas
vs.
NLRC,
supra;
ALU-TUCP
vs.
NLRC,
234
SCRA
678).
uuuuuuu.

Is notice required in case of termination of project employees?

No, but a report to DOLE about the termination is necessary.

No prior notice of termination is required if the termination is brought about by completion of the contract
or phase thereof for which the worker has been engaged. This is because completion of the work or
project automatically terminates the employment. (Cioco vs. C. E. Construction Corporation, G. R. No.
156748,
Sept.
8,
2004).
30.

What are the legal consequences of termination of project employment?

The legal effects of termination of project employees is best exemplified by the 2005 case of Filipinas PreFabricated Building Systems [Filsystems], Inc. vs. Puente, [G. R. No. 153832, March 18, 2005]. If
employees services were terminated for no valid cause prior to the expiration of the period of his
employment, the termination is illegal. Reinstatement with full back wages, inclusive of allowances and
other benefits or their monetary equivalents - computed from the date of his dismissal until his
reinstatement
is
thus
in
order.
However, if indeed the project has already been completed during the pendency of this suit, then
respondent - being a project employee - can no longer be reinstated. Instead, he shall be entitled to the
payment of his salary and other benefits corresponding to the unexpired portion of his employment,
specifically from the time of the termination of his employment until the date of the completion of the
project.

31.

What does substantial capital and investment as a requisite of labor-only contracting

contemplate?
These refer to the tools, equipment, machineries, work premises, and other materials which are necessary
in the conduct of his business (Philippine Fuji Xerox vs. NLRC G.R. No. 111501 March 5, 1996)

32.

33.

When may a strike be enjoined?

If it will cause grave or irreparable damage to any party or render ineffectual any decision in
favor of such party (Art. 218)

When it will cause or is likely to cause a strike affecting national interest (Art. 264)

Union A went on strike on September 5, 2009, the same day they filed their notice to strike. Is
the strike legal?
No, because it did not observe the cooling-off period and the 7-day strike ban. (Article 263(c)(f), Labor
Code; TUCP v. NLRC, GR No. 88053, May 31, 1989)

34.

What is the Country-team Approach?

This concept, as stated in the Migrant Workers Act, means that all officers, representatives and personnel
of the Philippine government working abroad, regardless of their mother agencies shall on a per country
basis act as one country-team with a mission under the leadership of the ambassador.

35.

Distinguish between consent election and certification election

Consent Election

Certification Election

determine the issue of majority

representation of all the workers in the
appropriate collective bargaining unit

Determining the sole and exclusive bargaining agent of all

the employees in an appropriate bargaining unit for the
purpose of collective bargaining. (Algire vs. De Mesa, G.R.
No. 97622, October 19, 1994)

voluntarily agreed upon by the parties,

with or without the intervention by the
DOLE

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Certification election is ordered by the DOLE.
(Section
1[h],
Rule I, Book V, Rules to Implement the Labor Code, as
amended by Department Order No. 40-03, Series of 2003
[February 17, 2003])

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36.

May a ULP be subject to compromise agreement?

No, ULP cases are not subject to compromises in view of the public interest involved. (Gochangco Workers
Union v. NLRC).

37.

What is the period for contract of household helper?

The initial contract for household service shall not last for more than 2 years. However, such may be
renewed from year to year (Art. 142, Labor Code; Sec. 4, Rule XIII, Book III, Rules to Implement Labor
Code).

38.

What is the prescriptive period for filing an illegal dismissal case?

When one is arbitrarily and unjustly deprived of his job or means of livelihood, the action instituted to
contest the legality of ones dismissal from employment constitutes, in essence, an action predicated upon
an injury to the rights of the plaintiff, as contemplated under Art. 1146 of the New Civil Code, which must
be brought within four (4) years. Callanta vs. Carnation Philippines (GRN. 70615, Oct. 28, 1986)

39.

Types Of Illegal Recruitment

As to the no
of persons
committing
As to no of
victims
Essential
Elements

SIMPLE

SYNDICATED

3 or more conspiring and confederating

1 or 2

3 or more persons individually or as group

a. Offender is engaged in the recruitment and placement of workers

b. Offender undertakes any of the recruitment defined under Article 13(b) or commits any of
the prohibited practices enumerated under Article 34 of the Labor Code

a. RTC of the province or city where the offense was committed; or

Venue

b. RTC where the offended party actually resides at the time of the commission of the
offense:
Note: The RTC that first acquired jurisdiction excludes other courts. (Exclusionary Rule).
5 years

Prescription

Prision Mayor and Fine of P200k-500k

Penalty

40.

20 years
Life Imprisonment and Fine; P500k-1M
Note: if the offender is a minor, the penalty to
be imposed is prision mayor in its maximum
period.

Summary Of Overtime Rates:

OVERTIME during

Regular Workdays

RATES
Regular basic wage + 25% of regular basic wage

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Regular/Legal Holiday

Holiday wage rate + 30% of holiday rate (200%)

Rest Day or Special Holidays

Rest Day/Special Holiday wage rate + 30% of rest

day or special holiday wage rate (130%)

Scheduled Rest Day which is also Special

Holiday

Rest day & Special Holiday wage rate + 30% of rest

day & special holiday wage rate (150%)

Double Holiday

Double Holiday wage rate + 60% of double holiday

wage rate (400%)

Night Shift Differential

(10% x regular wage per hour) x no. of hours of work performed
41.

Premium Pay for Sunday Work

Day

Rate of Additional Compensation

Work on Scheduled Rest day

30% of regular wage

Work on Special Holiday

30% of regular wage

On Sundays and holidays where no regular

workdays and rest days are scheduled

30% of regular wage

Holiday Work falls on Scheduled Rest Day

50% of regular wage

42.

List Of Regular And Special Holidays (As Per Ra 9492)

Movable Dates
Regular Holidays
Maundy Thursday
Good Friday
Ramadan/ Eidul fitr (RA 9177)
Araw ng Kagitingan
- April 9
Independence Day
- June 12
National Heroes Day
- last Sunday of August
Bonifacio Day - November 30
43.

Immovable Dates
Regular Holidays
New Years Day
- January 1
Labor Day
- May 1
Christmas Day - December 25
Rizal Day
- December 30
Nationwide Special Days
All Saints Day - November 1
Last day of the year
- December 31

Successive holiday basis:

If there are two successive regular holidays, e.g., Maundy Thursday and Good Friday, the employee must
be present the day before the scheduled regular holiday to be entitled to compensation to both;
otherwise, he must work on the first holiday to be entitled to holiday pay on the second regular holiday.
(Sec.10, Rule IV, Book III, Implementing Rules)

44.

What are the steps in collective bargaining?

1.
Preliminary Process by serving a written notice to the other party of its proposals. The other
party is required to reply not later than 10 days upon receipt of such notice. (Rivera vs. Espiritu
GR No. 135547, Jan. 23, 2002)
2.

Negotiation conducted not later than 10 calendar days from the date of request for conference.
(Article 250 252)

3.

Execution by signing and executing of the CBA by the representatives of both management and
the bargaining union.

4.

Publication by posting a copy of the newly-concluded CBA in at least 2 conspicuous places in

the company.

5.

Ratification ratification of the new CBA by at least a majority of the members of the bargaining
unit.

6.

Registration 5 copies of CBA should be submitted with other documentary requirements and
payment of registration fee to the BLR or Regional DOLE Office.

7.

Administration - joint administration of the CBA by the employer and the bargaining union during
the entire lifetime thereof. (Article 253-A)

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8.

45.

Interpretation and Application application and enforcement of the stipulations embodied in the
new CBA.

Is a newspaper columnist an employee of the newspaper which publishes the column?

No, she is an independent contractor engaged to do independent work. Rules which serve as general
guidelines towards the achievement of the mutually desired result are not indicative of the power of
control. The so-called control as to time, space, and discipline are dictated by the nature of the
newspaper business itself and inherent conditions in running a newspaper. (Orozco vs. CA, et al., G.R. No.
155207, August 13, 2008)

46.

When is there wage distortion?

a.there

exists intentional quantitative differences in wages among employees of different classes based
on skill, length of service, etc.

b.a wage order is issued increasing wage rates

c. such wage rates are eliminated or there is a severe contraction thereof.
47.

A, B and C are employed as household helpers. They filed a claim with the Labor Arbiter for
unpaid wages amounting to 2,000, 3,000 and 6,000 respectively, without a prayer for
reinstatement. The case was dismissed for lack of jurisdiction. Was the dismissal correct?
The dismissal is correct as regards A and B because the law provides that where the aggregate money
claim of each employee or househelper does not exceed Php 5,000 and there is no prayer for
reinstatement, the jurisdiction lies with the Regional Director (Article 129, LC).
As regards C, the dismissal is incorrect since his claim falls under the jurisdiction of the Labor Arbiter
(Article 217, LC).

48.

What is the effect of conversion of the notice of strike/lockout into a preventive mediation
case?
Under the NCMB rules, there is a remedy called preventive mediation. The NCMB has the authority to
convert a notice of strike filed by the union into a preventive mediation case if it finds that the real issues
raised therein are non-strikeable in character. Such authority is in pursuance of the NCMBs duty to exert
all efforts at mediation and conciliation to enable the parties to settle the dispute amicably and in line with
the state policy of favoring voluntary modes of settling labor disputes. Once a notice of strike/lockout is
converted into a preventive mediation case, it will be dropped from the docket of notices of
strikes/lockouts. Once dropped therefrom, a strike/lockout can no longer be legally staged based on the
same notice. The conversion has the effect of dismissing the notice. (Philippine Airlines, Inc. vs. Secretary
of Labor and Employment, G.R. No. 88201, January 23, 1991, 193 SCRA 223)

49.

What is parental leave?

R.A. No. 8972 (An Act Providing for Benefits and Privileges to Solo Parents and Their Children,
Appropriating Funds Therefor and for Other Purposes), otherwise known as The Solo Parents Welfare Act
of 2000 provides:
Section 8. Parental Leave In addition to leave privileges under existing laws, parental leave of
not more than seven (7) working days every year shall be granted to any solo parent employee
who has rendered service of at least one (1) year.
This benefit is granted to a solo parent to enable him or her to perform parental duties and responsibilities
where physical presence is required. This leave privilege is an additional leave benefit, which is separate
and distinct from any other leave benefits provided under existing laws.

50.

What is the Brent School Doctrine?

There is nothing essentially contradictory between a definite period of an employment contract and the
nature of the employees duties set down in the contract as being usually necessary or desirable in the
usual business or trade of the employer.
This applies to employment contracts to which a fixed term is an essential and natural appurtenance:
overseas employment contracts, for one, to which, whatever the nature of the engagement, the concept
of regular employment with all that it implies does not appear ever to have been applied, Art. 280 of the
Labor Code notwithstanding; also appointments to the positions of dean, assistant dean, college secretary,
principal and other administrative offices in educational institutions, which are by practice or tradition
rotated among the faculty members, and where fixed terms are a necessity without which no reasonable
rotation would be possible. (Brent School, Inc. vs. Zamora, G.R. No. 48494, February 5, 1990; AMA
Computer College, Paraaque, et al. vs. Austria, G.R. No. 164078, November 23, 2007)

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51.

A Co. had service contracts with B Co. wherein the former provided janitorial and maintenance
services to the latter. The employment contracts of the janitors and employees provided by A
Co. were periodically renewed. However, when the service contract between A Co. and B Co.
was not renewed, the employees were terminated, and the termination was not reported to the
DOLE. The employees filed a complaint for illegal dismissal. A Co. claims the termination was
not illegal because the employees were project employees, not regular employees, whose
employment was coterminous with the service contract with B Co. Is the contention of A Co.
tenable?
The dismissed workers were regular employees. The principal test in determining whether an employee is
a project employee is whether he/she is assigned to carry out a specific project or undertaking, the
duration and scope of which are specified at the time the employee is engaged in the project, or where the
work or service to be performed is seasonal in nature and the employment is for the duration of the
season. A true project employee should be assigned to a project, which begins and ends at determined or
determinable times, and be informed thereof at the time of hiring. (OMSI vs. Chantengco, et al., G.R. No.
156146, June 21, 2007)

52.

How is the decision of a Voluntary Arbitrator enforced?

Upon motion of any interested party, the Voluntary Arbitrator or panel of Voluntary Arbitrators or the
Labor Arbiter in the region where the movant resides, in case of the absence or incapacity of the Voluntary
Arbitrator or panel of Voluntary Arbitrators, for any reason, may issue a writ of execution requiring either
the sheriff of the NLRC or regular courts or any public official whom the parties may designate in the
submission agreement to execute the final decision, order or award. (Article 262-A of the Labor Code)

LABOR RELATIONS
vvvvvvv.

What are the two kinds of jurisdiction of the NLRC?

Original Jurisdiction
a. Injunction in ordinary labor disputes
b. Injunction in strikes or lockouts under Article 264 of the Labor Code.
c. Certified labor disputes causing or likely to cause a strike or lockout in an industry indispensable to the
national interest, certified to it by the Secretary of Labor and Employment for compulsory arbitration.
d. contempt cases pursuant to powers of the commission.
exclusive appellate jurisdiction.
a.

All cases decided by the Labor Arbiters including contempt cases.

b. Cases decided by the DOLE Regional Directors or his duly authorized Hearing
Officers (under Article 129) involving recovery of wages, simple money claims and other
benefits not exceeding P5,000 and not accompanied by claim for reinstatement.

HAIL TO THE CHIEFS!

Arellano University School of Law
Bar Operations Commission 2009
LABOR LAW COMMISSION
COMMISSIONER: ROSALISA MORAN-VIDAL
SUBJECT HEADS:
LABOR STANDARDS: EARL GOICO; LABOR RELATIONS: KAT SERRANO
MEMBERS: Johar Macabangit; Hazel Sabornido; Anne De Belen; Glenn Matulac; Jane Timbang;
Michelle Labajanan; Victor Cayco; Mae Napa; Cherie Lira; Irish Caamales; Kristin Amat;

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