Bar Exam 2010 Suggested Answers in LABOR AND SOCIAL LEGISLATION by the UP Law Center

PART I

TRUE OR FALSE. Explain your answer briefly.

1. Deeds of release, waivers and quitclaims are always valid and binding. (2%)

SUGGESTED ANSWER:

FALSE. Deeds of release, waivers and quitclaims are not always valid and binding. An
agreement is valid and binding only if : (a) the parties understand the terms and conditions
of their settlement; b) it was entered into freely and voluntarily by them; and (c) it is
contrary to law, morals, and public policy.

ALTERNATIVE ANSWER:

FALSE. Not all deeds of release, waivers and quitclaims are valid and binding. The
Supreme Court, In Periquet v. NLRC (186 SCRA 724 [1990]) and affirmed In Solgus
Corporation v. Court of Appeals (514 SCRA 522 [2007]), provided the following guide
posts in determining the validity of such release, waivers and quitclaims:

“Not all waivers and quitclaims are invalid as against public policy. If the agreement was
voluntarily entered into and represents a reasonable settlement, it is binding on the parties
and may not later be disowned simply because of a change of mind. But where it is shown
that the person making the waiver did so voluntarily, with full understanding of what he
was doing, and the consideration for the quitclaim is credible and reasonable, the
transaction must be recognized as a valid and binding undertaking.”

2. The relations between employer and employee are purely contractual in nature. (2%)

SUGGESTED ANSWER:

FALSE. Some aspects of the relations between employer and employee are determined by
certain labor standards.

ALTERNATIVE ANSWER:
FALSE. The Constitution, Labor Code, Civil Code and other social legislations are replete
with provisions that define employment relationship oven without contract, with the
intention of insuring that all the rights of labor are protected.

Article 1700 of the Civil Code provides that “[The relations between capital and labor are
not merely contractual. They are so impressed with public interest that labor contracts
must yield to the common good.”

In Article 106 of the Labor Code, the principal is deemed as a direct employer in labor-
only contracting, despite absence of contractual relationship between the worker and the
principal reduced in writing.

Equity likewise affords the aggrieved party relief in a case where an agent was given
apparent authority by the employer to represent it to third persons, such as in a
relationship between hospitals and doctors practicing medicine in its establishment
(Nograles v. Capitol Medical Center, 511 SCRA 204 [2006]).

3. As a general rule, direct hiring of Overseas Filipino Workers (OFWs) is not allowed.
(2%)

SUGGESTED ANSWER:

TRUE. Art. 18 of the Labor Code provides that no employer may hire a Filipino worker
for overseas employment except through the Boards and entities authorized by the
Department of Labor and Employment (DOLE) except direct-hiring by members of the
diplomatic corps, International organizations and such other employers as may be allowed
by the DOLE.

Another exemption is “Name Hire, which refers to a worker who is able to secure an
overseas employment opportunity with an employer without the assistance or participation
of any agency.

II

1. Distinguish the terms “conciliation,” “mediation” and “arbitration”. (3%)

SUGGESTED ANSWER:

There is a DOLE official called a “Conciliator Mediator”. He is an officer of the NCMB

whose principal function is to assist in the settlement and disposition of labor –
management disputes through conciliation and preventive mediation. However, he does not
promulgate decisions that settle controversies about rights, which are demandable and
enforceable. The latter is called arbitration and is the function of a labor arbiter or a
voluntary arbitrator.

ALTERNATIVE ANSWER:

(1) CONCILIATION is the process of dispute management whereby parties in dispute are
brought together for the purpose of: (1) amicably settling the case upon a fair compromise:
(2) determining the real parties In interest; (3) defining and simplifying the issues in the
case;(4) entering into admissions or stipulations of facts; and (5) threshing out all other
preliminary matters (Section 3, Rule V, 2005 NLRC Rules of Procedure). In resolving labor
disputes, this comes before arbitration, as a mandatory process, pursuant to the State
policy of promoting and emphasizing conciliation as modes of settling labor disputes (Art.
211 (A)(a), Labor Code).

(2) MEDIATION Is a voluntary process of settling dispute whereby the parties elect a
mediator to facilitate the communication and negotiation between the parties in dispute for
the purpose of assisting them in reaching a compromise (Sec. 319), Rep. Act No. 9285 or the
Alternative Dispute Resolution Law).

(3) ARBITRATION is a system of dispute settlement that may be compulsory or voluntary,

whereby the parties are compelled by the government, or agree to submit their dispute
before an arbiter, with the Intention to accept the resolution of said arbiter over the dispute
as final and binding on them (Luzon Development Bank v. Association of Luzon
Development Employees, 249 SCRA 162 [1995]).

In this jurisdiction, compulsory arbitration in labor disputes are submitted to a labor

arbiter, whose powers and functions are clearly defined under Article 217(a) of the Labor
Code; whereas in voluntary arbitration, the powers and functions of the voluntary
arbitrator or panel of voluntary arbitrators elected to resolve the parties’ dispute involve
the interpretation and implementation of the parties’ collective bargaining agreement,
pursuant to Articles 260-262 of the Labor Code.

1. Differentiate “surface bargaining from “blue-sky bargaining”. (2%)

SUGGESTED ANSWER:

(1) SURFACE BARGAINING is defined as “going through the motions of negotiating”

without any legal intent to reach an agreement. The determination of whether a party has
engaged in unlawful surface bargaining is a question of the intent of the party in question,
which can only be inferred from the totality of the challenged party’s conduct both.at and
away from the bargaining table. It involves the question of whether an employer’s conduct
demonstrates in unwillingness to bargain in good faith or is merely hard
bargaining (Standard Chartered Bank Employees Union (NUBE) v. Confesor, 432 SCRA 308
[2004]).
(2) BLUE-SKY BARGAINING is defined as “unrealistic and unreasonable demands in
negotiations by either or both labor and management, where neither concedes anything
and demands the impossible* (Standard Chartered Bank Employees Union (NUBE) v.
Confesor, supra.).

III

A, single, has been an active member of the Social Security System for the past 20 months. She
became pregnant out of wedlock and on her 7th month of pregnancy, she was informed that she
would have to deliver the baby through caesarean Section because of some complications. Can A
claim maternity benefits? If yes, how many days can she go on maternity leave? If not, why is
she not entitled? (3%)

SUGGESTED ANSWER:

YES. The SSS Law does not discriminate based on the civil status of a female member-
employee. As long as said female employee has paid at least three (3) monthly contributions
in the twelve-month period immediately preceding the semester of her childbirth, she can
avail of the maternity benefits under the law.

Since A gave birth through C-section, she is entitled to one hundred percent (100%) of her
average salary credit for seventy-eight (78) days, provided she notifies her employer of her
pregnancy and the probable date of her childbirth, among others (See Section 14-A, Rep.
Act No. 8282).

The same maternity benefits are ensured by Sec. 22 (b)(2) of the Magna Carta of Women
(Rep. Act No. 9710).

IV

A, a worker of ABC Company, was on leave with pay on March 31, 2010. He reported for work
on April 1 and 2. Maundy Thursday and Good Friday, respectively, both regular holidays. Is A
entitled to holiday pay for the two successive holidays? Explain, (3%)

SUGGESTED ANSWER:

YES. A is entitled to holiday pay equivalent to two hundred percent (200%) of his regular
daily wage for the two successive holidays that he worked (Section 6/a), Rule IV, Book III
of the Omnibus Rules implementing the Labor Code).
 V

Company XYZ has two recognized labor unions, one for its rank-and-file employees (RFLU),
and one for supervisory employees (SELU). Of late, the company instituted a restructuring
program by virtue of which A, a rank-and-file employee and officer of RFLU, was promoted to a
supervisory position along with four (4) other colleagues, also active union members and/or
officers. Labor Union KMJ, a rival labor union seeking recognition as the rank-and-file
bargaining agent, filed a petition for cancellation of the registration of RFLU on the ground that
Aand her colleagues have remained to be members of RFLU, Is the petition meritorious?
Explain. (3%)

SUGGESTED ANSWER:

1. Having been promoted to supervisory positions, A and her colleagues are no longer
part of the rank-and file bargaining unit. They are deemed removed from
membership of RFLU (Art. 245-A, Labor Code as amended by Rep. Act No. 9481).

VI

A is a member of the labor union duly recognized as the sole bargaining representative of his
company. Due to a bargaining deadlock, 245 members of the 500-strong union voted on March
13, 2010 to stage a strike. A notice of strike was submitted to the National Conciliation and
Mediation Board on March 16, 2010. Seven days later or on March 23, 2010, the workers staged
a strike in the course of which A had to leave and go to the hospital where his wife had just
delivered a baby. The union members later intimidated and barred other employees from entering
the work promises thus paralyzing the business operations of the company.

A was dismissed from employment as a consequence of the strike.

1. Was the strike legal? Explain. (3%)

SUGGESTED ANSWER:

1. The strike was not legal due to the union’s failure to satisfy the required majority
vote of union membership (251 votes), approving the conduct of a strike (See Art.
26301, Labor Code; Section 11, Rule XXII, Dept. Order No. 40-03

Also, the strike was illegal due to the non-observance of the 30-day cooling off period by the
union (Art. 263/c), Labor Code).

1. Was A’s dismissal valid? Why or why not? (3%)

SUGGESTED ANSWER:
 1. Article 264 of the Labor Code distinguishes the effects of illegal strikes between
ordinary workers and union officers who participate therein. A, as an ordinary
striking worker, may not be declared to have lost his employment status by mere
participation in an illegal strike, unless there is proof that he knowingly participated
in the commission of illegal acts during the strike(Arellano University Employees and
Workers Union v. CA. 502 SCRA 219 [2006]). This is an aspect of the State’s
constitutional and statutory mandate to protect the rights of employees to self-
organization (Club Filipino, Inc. v. Bautista, 592 SCRA 471 [2009]).

VII

A was an able seaman contracted by ABC Recruitment Agency for its foreign principal,
Seaworthy Shipping Company (SSC). His employment contract provided that he would serve on
board the Almeda IT for eight (8) months with a monthly salary of US $450. In connection with
his employment, he signed an undertaking to observe the drug and alcohol policy which bans
possession or use of all alcoholic beverages, prohibited substances and unprescribed drugs on
board the ship. The undertaking provided that: (1) disciplinary action including dismissal would
be taken against anyone in possession of the prohibited substances or who is impaired by the use
of any of these substances, and (2) to enforce the policy, random test sampling would be done on
all those on board the ship.

On his third month of service while the Almieda I was docked at a foreign port, a random drug
test was conducted oli all members of the crew and A tested positive for marijuana. He was
given a copy of the drug test result. In compliance with the company’s directive, he submitted his
written explanation which the company did not find satisfactory. A month later, he was
repatriated to the Philippines.

Upon arrival in the Philippines, A filed with the National Labor Relations Commission (NLRC)
a complaint against the agency and the principal for illegal dismissal with a claim for salaries for
the unexpired portion of his contract.

1. Was A’s dismissal valid? Explain. (3%)

SUGGESTED ANSWER:

NO, A’s dismissal was not valid. A was not found to be *in possession of the prohibited
substance” nor was he Him paired by the use” thereof. Being tested positive for
marijuana” is not a ground for “disciplinary action” under the “undertaking” he signed.

ALTERNATIVE ANSWER:
YES, A’s dismissal was valid. He was tested positive for marijuana. This is in violation of
the drug and alcohol policy, which bans possession, or use of all alcoholic beverages,
prohibited substances and un-prescribed drugs on board the ship.

1. Is his claim for salaries for the unexpired portion of his contract tenable? Explain. (3%)

SUGGESTED ANSWER:

YES, Section 10 of Rep. Act No. 8042 (as amended by Rep. Act No. 10022) provides that in
case of termination of overseas employment without just, valid or authorized cause as
defined by law or contract, or any unauthorized deductions from the inigrant worker’s
salary, the worker shall be entitled to the full reimbursement of his placement fee with
interest at twelve percent (12%) per annum, plus his salaries for the unexpired portion of
his employment contract or for three (3) years for every year of the unexpired term,
whichever is less (cf. Serrano v. Gallant Maritime, 582 SCRA 254 [2009]).

ALTERNATIVE ANSWER:

1. Under Rep. Act No. 8042, money claim can be made only if there is dismissal
without just or authorized cause.

VIII

ABC company and U labor union have been negotiating for a new Collective Bargaining
Agreement (CBA) but failed to agree on certain economic provisions of the existing agreement.
In the meantime, the existing CBA expired. The company thereafter refused to pay the
employees their midyear bonus, saying that the CBA which provided for the grant of midyear
bonus to all company employees had already expired. Are the employees entitled to be paid their
midyear bonus? Explain your answer. (3%)

SUGGESTED ANSWER:

YES, under Article 253 of the Labor Code, the parties Are duty-bound to maintain the
status quo and to continue in full force and effect the terms and conditions of the existing
CBA until a new agreement is reached by the parties.

Likewise, Art. 253-A provides for an automatic renewal clause of a CBA. Although a CBA
has expired, it continues to have legal effects as between the parties until a new CBA has
been entered into.

The same is also supported by the principle of holdover, which states that despite the lapse
of the formal effectivity of the CBA, the law stills considers the same as continuing in force
and effect until a new CBA shall have been validly executed (MERALCO v. Hon. Sec. of
Labor, 337 SCRA 90 [2000] citing National Congress of Unions in the Sugar Industry of
the Philippines v. Ferrer-Calleja, 205 SCRA 478 [1992]).

The terms and conditions of the existing CBA remain under the principle of CBA
continuity.

IX

A was working as a medical representative of RX pharmaceutical company when he met and fell
in love with B, a marketing strategist for Delta Drug Company, a competitor of RX. On several
occasions, the management of RX called A’s attention to the stipulation in his employment
contract that requires him to disclose any relationship by consanguinity or affinity with co-
employees or employees of competing companies in light of a possible conflict of interest A
seeks your advice on the validity of the company policy. What would be your advice? (3%)

SUGGESTED ANSWER:

The company policy is valid. However, it does not apply to A. As A and Bare not yet
married, no relationship by consanguinity or affinity exists between them. The case of
Duncan v. Glaxo Welcome(438 SCRA 343 [2004]] does not apply in the present case.

A, an employee of XYZ Cooperative, owns 500 shares in the cooperative. He has been asked to
join the XYZ Cooperative Employees Association. He seeks your advice on whether he can join
the association. What advice will you give him? (3%)

SUGGESTED ANSWER:

A cannot join XYZ Cooperative Employees Association, because owning shares in XYZ
Cooperative makes him a co-owner thereof.

An employee-member of a cooperative cannot join a union and bargain collectively with his
cooperative for an Howner cannot bargain with himself and his co-owners (Cooperative
Rural Bank of Davao City, Inc. v. Calleja, 165 SCRA 725, 732 [1988]; San Jose City –
Electric Service Cooperative, Inc. v. Ministry of Labor, 173 SCRA 697,701703 [1989]).

XI
Because of continuing financial constraints, XYZ, Inc. gave its employees the option to
voluntarily resign from the company. A was one of those who availed of the option. On October
5, 2007, he was paid separation benefits equivalent to seven (7) months pay for his six (6) years
and seven (7) months of service with the company and he executed a waiver and quitclaim.

A week later, A filed against XYZ, Inc. a complaint for illegal dismissal. While he admitted that
he was not forced to sign the quitclaim, he contended that he agreed to tender his voluntary
resignation on the belief that XYZ, Inc. was closing down its business. XYZ, Inc., however
continued its business under a different company name, he claimed.

Rule on whether the quitclaim executed by A (Gabrielj is valid or not. Explain. (3%)

SUGGESTED ANSWER:

The quitclaim executed by A is valid and binding.

Generally, deeds of release, waiver or quitclaims cannot bar employees from demanding
benefits to which they are legally entitled or from contesting the legality of their dismissal,
since quitclaims are looked upon with disfavor and are frowned upon as contrary to public
policy. However, where the person making the waiver has done so voluntarily, with a full
understanding thereof, and the consideration for the quitclaim is credible and reasonable,
the transaction must be recognized as being a valid and binding undertaking (Francisco
Soriano, Jr. NLRC, et al., 530 SCRA 526 [2007]).

A elected to voluntarily resign, and accepted a credible and reasonable separation benefits
package. In exchange, A executed a waiver and quitclaim.

A’s resignation could not have possibly been vitiated by any fraud or misrepresentation on
the part of XYZ, Inc. The company offered its voluntary resignation package because of
continuing financial constraints, and not preliminary to closure of business. A’s belief is not
the kind of proof required that will show he was defrauded, his consent vitiated, and
therefore the termination of his employment illegal.

ALTERNATIVE ANSWER:

The quitclaim is invalid. The signing of the quitclaim was based on a wrong premise, and
the employer was deceitful by not divulging full information. The subsequent re-opening of
the business under another name is an indication of bad faith and fraud..

XII
On December 12, 2008, A signed a contract to be part of the crew of ABC Cruises, Inc. through
its Philippine marining agency XYZ. Under the standard employment contract of the Philippine
Overseas Employment Administration (POEA), his employment was to commence upon his
actual departure from the port in the point of hire, Manila, from where he would take a flight to
the USA to join the cruise ship “MS Carnegie.” However, more than three months after A
secured his exit clearance from the POEA for his supposed departure on January 15, 2009, XYZ
still had not deployed him for no valid reason.

Is A entitled to relief? Explain. (3%)

ALTERNATIVE ANSWER:

YES. Even if no departure took place, the contract of employment has already been
perfected which creates certain rights and obligations, the breach of which may give rise to
a cause of action against the erring party:

(1) A can file a complaint for Recruitment Violation for XYZ’s failure to deploy him within
the prescribed period without any valid reason, a ground for the imposition of
administrative sanctions against XYZ under Section 2, Rule I, Part V of the 2003 POEA
Rules on Employment of Seafarers.

(2) At the same time. A can file a case for illegal recruitment under Section 6(L) of Rep. Act
No. 8042 (cf. Section 11 Rule I, Part V of the 2003 POEA Rules on Employment of
Seafarers).

(3) A may likewise file a complaint for breach of contract, and claim damages there for
before the NLRC, despite absence of employer employee relationship. Section 10 of Rep.
Act No. 8042 conferred jurisdiction on the Labor Arbiter not only on claims arising out of
EER, but also by virtue of any law or contract involving Filipino workers for overseas
deployment including claims for actual, moral, exemplary and other forms of damages.
(Santiago vs. CF Sharp Crew Management, 527 SCRA 165 [2007]).

XIII

A is employed by XYZ Company where XYZ Employees Union (XYZ-EU) is the recognized
exclusive bargaining agent. Although A is a member of rival union XYR-MU, he receives the
benefits under the CBA that XYZ-EU had negotiated with the company.

XYZ-EU assessed A a fee equivalent to the dues and other fees paid by its members but A insists
that he has no obligation to pay said dues and fees because he is not a member of XYZ-EU and
he has not issued an authorization to allow the collection. Explain whether his claim is
meritorious. (3%)
SUGGESTED ANSWER:

1. The fee exacted from A takes the form of an AGENCY FEE. This is sanctioned by
Article 248 (e) of the Labor Code.

The collection of agency fees in an amount equivalent to union dues and fees from
employees who are not union members is recognized under Article 248(e) of the Labor
Code. The union may collect such fees even without any written authorization from the
non-union member employees, if said employees accept the benefits resulting from the
CBA. The legal basis of agency fees is quasicontractual (Del Pilar Academy v. Del Pilar
Academy Empluyeres Urzton, 553 SCRA 590 [2008]).

PART II

XIV

After working from 10 a.m. to 5 p.m. on a Thursday as one of 5,000 employees in a beer factory,
A hurried home to catch the early evening news and have dinner with his family. At around
10p.m. of the same day, the plant manager called and ordered A to fill in for C who missed the
second shift.

1. May A validly refuse the plant manager’s directive? Explain. (2%)

SUGGESTED ANSWER:

YES. A may validly refuse to fill in for C. A may not be compelled to perform overtime
work considering that the plant manager’s directive is not for an emergency overtime
work, as contemplated under Article 89 of the Labor Code.

1. Assuming that A was made to work from 11 p.m. on Thursday until 2 a.m. on Friday,
may the company argue that, since he was two hours late in coming to work of Thursday
morning, he should only be paid for work rendered from 1 a.m. to 2 a.m.? Explain. (3%)

SUGGESTED ANSWER:

1. Undertime is not off-set by overtime (Art. 88, Labor Code)

XV

Samahang Manggagawa ng Terracota, a union of supervisory employees at Terracota Inc.,

recently admitted A member of the company’s managerial xiafr, A, Into the union ranks.
 

1. Should A be a member of the supervisory union? Explain.

SUGGESTED ANSWER:

YES, as long as A is not a confidential employee who has access to confidential matters on
labor relations (San Miguel Corporation Supervisors and Exempt Employees Union v.
Laguesma, 277 SCRA 370,374-375 [1997]]

If A performs supervisory functions, such as overseeing employees’ performance and with

power of recommendation, then A is a rightful member of the supervisory union.
Otherwise, he may not, because Samahang Manggagawa ng Terracota cannot represent A,
A being not part of SMT’s bargaining unit.

B Assuming that A is ineligible to join the union, should the registration of Samahang
Manggagawang Terracota be cancelled? Explain. (3%)

SUGGESTED ANSWER:

1. Rep. Act No. 9481 introduced a new provision, Art. 245-A, which provides that
mixed membership is not a ground for cancellation of a union’s registration, but said
employees wrongfully joined are deemed removed from said union.

XVI

On the first day of collective bargaining negotiations between rank-and-file Union A and B Bus
Company, the former proposed a P45/day increase. The company insisted that ground rules for
negotiations should first be established, to which the union agreed. After agreeing on ground
rules on the second day, the union representatives reiterated their proposal for a wage increase.
When company representatives suggested a discussion of political provisions in the Collective
Bargaining Agreement as stipulated in the ground rules, union members went on mass leave the
next day to participate in a whole-day prayer rally in front of the company building.

1. The company filed a petition for assumption of jurisdiction with the Secretary of Labor
and Employment. The Union opposed the petition, arguing that it did not intend to stage a
strike. Should the petition be granted? Explain. (2%)

SUGGESTED ANSWER:

YES.
There was a strike. What the union engaged in was actually a “work stoppage in the guise
of a protest rally.

Article 212(o) of the Labor Code defines strike as a temporary stoppage of work by the
concerted action of employees as a result of an industrial or labor dispute. The fact that the
conventional term “strike was not used by the striking employees to describe their common
course of action is in consequential. What is controlling is the substance of the situation,
and not its appearance. The term strike” encompasses not only concerted work stoppages,
but also slowdowns, mass leaves, ait-downs, attempts to damage, destroy or sabotage plant
equipment and facilities, and similar activities (Santa Rosa CocaCola Plant Employees
Union, Donricou. Sebastian, et al. v. Coca-Cola Bottlers Phils., Inc., 512 SCRA 437 [2007]).

1. The Union contended that assuming that the mass leave will be considered as a strike, the
same was valid because of the refusal of the company to discuss the economic provisions
of the CBA. Rule on the contention, (2%)

SUGGESTED ANSWER:

The Union’s contention is wrong. A strike may be declared only in cease of deadlock in
collective bargaining negotiations and unfair Labor practice (Article 263(c, Labor Code);
Section 1, Rule V, NCMB Manual of Procedures).

The proposal of the company to discuss political provisions pursuant to the ground rules
agreed upon does not automatically mean that the company refuses to discuss the economic
provisions of the CBA, or that the company was engaged in “surface bargaining” in
violation of its duty to bargain, absent any showing that such tend to show that the
company did not want to reach an agreement with the Union. In fact, there is no deadlock
to speak of in this case.

The duty to bargain does not compel either party to agree to a proposal or require the
making of a concession, The parties’ failure to agree which to discuss first on the
bargaining table did not amount to ULP for violation of the duty to bargain.

Besides, the mass leave conducted by the union members failed to comply with the
procedural requirements for a valid strike under the Rules, without which, the strike
conducted taints of illegality.

1. Union member AA, a pastor who headed the prayer rally, was served a notice of
termination by management after it filed the petition for assumption of jurisdiction. May
the company validly terminate AA? Explain. (2%)

SUGGESTED ANSWER
 1. The company cannot terminate AA because the Labor Code provides mere
participation of a worker in a strike shall not constitute sufficient ground for
termination of his employment.

XVI

A was hired in a sugar plantation performing such tasks as weeding, cutting and loading canes.
planting cane points, fertilizing and cleaning the drainage. Because his daily presence in the field
was not required, A also worked as a houseboy at the house of the plantation owner. For the next
planting season, the owner decided riot to hire A as a plantation worker but as a houseboy
instead. Furious, A filed a case for illegal dismissal against the plantation owner. Decide with
reason. (3%)

SUGGESTED ANSWER

A is a regular seasonal employee. Therefore, he cannot be dismissed without just or valid

cause.

The primary standard for determining regular employment is the reasonable connection
between the particular activity performed by the employee in relation to the usual trade or
business of the employer (Pier 8 Arrastre & Steredoring Services, Inc., et al. v. Jeff B.
Boclot, 534 SCRA 431 [2007]). Considering that A, as plantation worker, performs work
that is necessary and desirable to the usual business of the plantation owner, he is therefore
a regular seasonal employee and is entitled to reinstatement upon onset of the next season
unless he was hired for the duration of only one season (Hacienda Bino v. Cuenca, 456
SCRA 300 [2005]].

Converting Ato a mere houseboy at the house of the plantation owner amounts to an act of
severing his employment relations as its plantation worker (Angeles D. Fernandez, 513
SCRA 378 [2007]).

ALTERNATIVE ANSWER

It is management prerogative to determine what kind of worker is needed by the

plantation. Of course, if the prerogative is exercised and results in redundancy, there must
be payment of separation pay under Article 283 of the Labor Code.

XVIII

Flight attendant A, five feet and six inches tall, weighing 170 pounds ended up weighing 220
pounds in two years Pursuant to the long standing Cabin and Crew Administration Manual of the
employer airline that set a 147-pound limit for A’s height, management sent A a notice to “shape
up or ship out” within 60 days. At the end of the 60-day period, A reduced her weight to 205
pounds. The company finally served her a Notice of Administration Charge for violation of
company standards on weight requirements. Should A be dismissed? Explain. (3%)

SUGGESTED ANSWER

1. While the weight standards for cabin crew may be a valid company policy in light of
its nature as a common cartier, the airline company is now estopped from enforcing
the Manualas cround for dismissal against A. It hired A despite her weight of 170
pounds, in contravention of the same Manual it now Invoked.

The Labor Code gives to in airline the power to determine appropriate minimum age and
other standards for requirement or termination in special occupations such as those of light
attendants and the like. Weight standards for cabin crew is a reasonable imposition by
reason of flight safety (Yrasuegut v. PAL, 569 SCRA 467 [2008]). However, A had already
been employed for two (2) years before the airline company imposed on her this weight
regulation, and nary an incident did the airline company raise which rendered her amiss of
her duties.

XIX

Several employees and members of Union A were terminated by Western Phone Co. on the
ground of redundancy. After complying with the necessary requirements, the Union staged a
strike and picketed the premises of the company. The management then filed a petition for the
Secretary of Labor and Employment to assume jurisdiction over the dispute. Without the benefit
of a hearing, the Secretary issued an Order to assume jurisdiction and for the parties to revert to
the status quo ante litem

1. Was the order to assume jurisdiction legal? Explain, (2%)

SUGGESTED ANSWER

YES. The Secretary of Labor and Employment has plenary power to assume jurisdiction
under Article 263() of the Labor Code. When in his opinion, there exists a labor dispute
causing or likely to cause a strike or lockout in un industry indispensable to the national
Interest, the Secretary of Labor may assume jurisdiction over the dispute and decide it or
certify it to the NLRC for compulsory Arbitration (Art. 263/g), Labor Code). This
extraordinary authority glven to the Secretary of Labor is aimed at arriving at a peaceful
and speedy solution to labor disputes, without jeopardizing national interests (Steel
Corporation . SCP Employees Unton, 551 SCRA 594 [2008]). Such assumption shall have
the effect of automatically enjoining an impending strike or lockout, or in order directing
immediate return to work and resume operations, if a strike already took place, and for the
employer to re-admit all employees under the same terms and conditions prevailing before
the strike or lockout (Art. 263/9), Labor Code; Sec. 15, Rule XXII, Dept. Order No. 40-G-
03).

1. Under the same set of facts the Secretary instead issued an Order directing all striking
workers to return to work within 24 hours, except those who were terminated due to
redundancy. Was the Order legal? Explain. (3%)

SUGGESTED ANSWER

1. The Secretary of Labor’s order will be inconsistent with the established policy of the
State of enjolning the parties from performlng acts that undermine the onderlying
principles embodied in Article 26318) of the Labor Code.

In this case, excepting the employees terminated due to redundancy from those who are
required to return

to-work, which was the very labor dispute that sparked the union to strike, the Secretary of
Labor comes short of his duty under Article 26318) to maintain status quo or the terms and
conditions prevailing before the strike. In fact, the Secretary could be accused of disposing
of the parties’ labor dispute without the benefit of a hearing, in clear derogation of due
process of law.

XX

A, a driver for a bus company, sued his employer for non-payment of commutable service
incentive leave credits upon his resignation after five years of employment. The bus company
argued that A was not entitled to service incentive leave since he was considered a field
personnel and was paid on commission basis and that, in any event, his claim had prescribed. If
you were the Labor Arbiter, how would you rule? Explain. (6%)

SUGGESTED ANSWER:

I will grant the prayer of A.

Payment on commission basis alone does not prove that A is a field personnel. There must
be proof that A is left to perform his work unsupervised by his employer. Otherwise, he is
not a field personnel, thus entitled to commutable service incentive leave (SIL) credits
(Auto Bus u. Bautista, 458 SCRA 578 [2005]).
His action has not yet prescribed. In Auto Bus u. Bautista (supra), the Supreme Court
recognized that SIL is such a unique labor standard benefit, because it is commutable. An
employee may claim his accrued SIL throughout the years of his service with the company
upon his resignation, retirement, or termination. Therefore, when A resigned after five
years, his right of action to claim ALL of his SIL benefits accrued at the time when the
employer refused to pay him his rightful SIL benefits. (Art. 291, Labor Code).

ALTERNATIVE ANSWER

The money claim as cause of action has prescribed because the claim was filed after five (5)
years from date of negotiation. Art. 291 of the Labor Code provides that all money claims
arising from employeremployee relations occurring during the effectivity of the Code shall
be filled within three (3) years from that time the cause of action has accrued, otherwise,
they shall be forever barred.

XXI

A was approached for possible overseas deployment to Dubai by X, an interviewer of job

applicants for Alpha Personnel Services, Inc., an overseas recruitment agency. X required A to
submit certain documents (passport, NBI clearance, medical certificate) and to pay P25,000 as
processing fee. Upon payment of the said amount to the agency cashier, A was advised to wait
for his visa. After five months, A visited the office of Alpha Personnel Services, Inc. during
which X told him that he could no longer be deployed for employment abroad. A was informed
by the Philippine Overseas Employment Administration (POEA) that while Alpha Personnel
Services, Inc. was a licensed agency, X was not regiatered as its employce, contrary to POEA
Rules and Regulations. Under POEA Rules and Regulations, the obligation to register personnel
with the POEA belongs to the officers of a recruitment agency.

1. May X be held criminally lable for illegal recruitment? Explain. (2%)

SUGGESTED ANSWER:

1. X performed his work with the knowledge that he works for a licensed recruitment
agency. He is in no position to know that the officers of said recruitment agency failed
to register him as its personnel (People v. Chowdury, 325 SCRA 572 [2000]. The fault
not being

attributable to him, he may be considered to have apparent authority to represent Alpha in

recruitment for overseas employment.

1. May the officers having control, management or direction of Alpha Personnel Services,
Inc. be held criminally liable for illegal recruitment? Explain. (3%)

SUGGESTED ANSWER:
Yes. Alpha, being a licensed recruitment agency, still has obligations to A for processing his
papers for overseas employment. Under Section 6[m] of Rep. Act No. 8042, failure to
reimburse expenses incurred by the worker in connection with his documentation and
processing for purposes of deployment, in cases where the deployment does not actually
take place without the worker’s fault, amounts to illegal recruitment.

XXII

A was recruited to work abroad by Speedy Recruitment Agency as a technician for a Saudi
Arabian construction firm, with a monthly salary of $650.00. When she got to the construction
site, the employer compelled her to sign another contract that referred her to another employer
for a salary of $350.00. She worked for the second employer and was paid $350.00 until her two-
year contract expired. Upon her return to the Philippines, she filed a case against the agency and
the two employers. May the agency validly raise the defense that it was not privy to the transfer
of A to the second employer? Explain. (3%)

SUGGESTED ANSWER:

1. Speedy’s obligation to A is joint and several with the principal employer (Sec. 10,
Rep. Act No. 8042).

The liability of the principal/employer and the recruitment/placement agency for any and
all claims for

Memorandum, management explained that too much texting and phone-calling by employees
disrupted company operations. Two employees-members of Union X were terminated from
employment due to violation of the Triemorandum-policy. The union countered with a
prohibitory injunction case (with prayer for the issuance of a temporary restraining order) filed
with the Regional Trial Court, challenging the validity and constitutionality of the cell phone
bani. The company filed a motion to dismiss, arguing that the case should be referred to the
grievance machinery pursuant to an existing Collective Bargaining Agreement with Union X,
and eventually to Voluntary Arbitration. Is the company correct? Explain. (3%)

SUGGESTED ANSWER:

YES.

Termination cases arising in or resulting from the interpretation and implementation of

collective bargaining agreements, and interpretation and enforcement of company
personnel policies which were initially processed at the various steps of the plant-level
Grievance Procedures under the parties collective bargaining areements, fall within the
original and exclusive jurisdiction of the voluntary arbitrator purgiant to Article 217 (c)
and Article 261 of the Labor Code.

ALTERNATIVE ANSWER

NO, The Regional Trial Court has jurisdiction to hear and decide the prohibitory
injunction case filed by Union X against Company C to enjoin the latter from
Implementing the memorandum-policy against use of cell phones in the factory. What is at
isaue is Union X’S challenge against the validity and constitutionality of the cell phone ban
being implemented by Company C. The Issue, therefore, does not involve the
interpretation of the memorandum-policy, but its intrinsie validity (Haliguefla v. PAL, 602
SCRA 297 [2009]).

2014 Bar Exam Suggested Answers in Labor Law by the UP Law Complex

LABOR LAW

I.

Linda was employed by Sectarian University (SU) to cook for the members of a religious order
who teach and live inside the campus. While performing her assigned task, Linda accidentally
burned herself. Because of the extent of her injuries, she went on medical leave. Meanwhile, SU
engaged a replacement cook. Linda filed a complaint for illegal dismissal, but her employer SU
contended that Linda was not a regular employee but a domestic househelp. Decide (4%)

SUGGESTED ANSWER:

The employer’s argument that Linda was not a regular employee has no merit. The
definition of domestic servant or househelper contemplates one who is employed in the
employer’s home to minister exclusively to the personal comfort and enjoyment of the
employer’s family. The Supreme Court already held that the mere fact that the
househelper is working in relation to or in connection with its business warrants the
conclusion that such househelper or domestic servant is and should be considered as a
regular employee (Apex Mining Co., Inc. v. NLRC, G.R. No. 94951, April 22, 1991). Here,
Linda was hired not to minister to the personal comfort and enjoyment of her employer’s
family but to attend to other employees who teach and live inside the campus.
ALTERNATIVE ANSWER:

The complaint for illegal dismissal should be dismissed. There was no showing that in
hiring the replacement cook, SU severed its employer-employee relationship with Linda. In
illegal dismissal cases, an employee must first establish, by substantial evidence, the fact of
dismissal before shifting to the employer the burden of proving the validity of such
dismissal (Grand Asian Shipping Lines, Inc. v. Wilfred Galvez, G.R. No. 178184, January
29, 2014). Here, Linda’s dismissal was not clearly established.

II.

Lucy was one of approximately 500 call center agents at Hambergis, Inc. She was hired as a
contractual employee four years ago. Her contracts would be for a duration of five (5) months at
a time, usually after a one-month interval Her re-hiring was contingent on her performance for
the immediately preceding contract. Six (6) months after the expiration of her last contract, Lucy
went to Hambergis personnel department to inquire why she was not yet being recalled to work.
She was told that her performance during her last contract was “below average.” Lucy seeks your
legal advice about her chances of getting her job back. What will your advice be? (4%)

SUGGESTED ANSWER:

Lucy cannot get her job back. She is a fixed-term employee and as such, her employment
terminates upon the expiration of her contract (Rowell Industrial Corporation v. Court of
Appeals, G.R. No. 167714, March 7, 2007, 517 SCRA 691).

ALTERNATIVE ANSWER:

I will advise Lucy that she can get her job back if she files a case for illegal dismissal where,
as a general rule, the twin reliefs of backwages and reinstatement are available. In the
instant case, Lucy is a regular employee because the employment contracts of five (5)
months at a time, for four (4) years are obviously intended to circumvent an employee’s
security of tenure, and are therefore void. As a regular employee, Lucy may only be
dismissed from service based on just and authorized causes enumerated under the Labor
Code, and after observance of procedural due process prescribed under said law (Magsalin
v. National Organization of Working Men, G.R. No. 148492, May 9, 2003).
 

III

Lolong Law Firm (LLF), which employs around fifty (50) lawyers and one hundred (100)
regular staff, suffered losses for the first time in its history. The management informed its
employees that it could no longer afford to provide them free lunch. Consequently, it announced
that a nominal fee would henceforth be charged. Was LLF justified in withdrawing this benefit
which it had unilaterally been providing to its employees? (1%)

(A) Yes, because it is suffering losses for the first time.

(B) Yes, because this is a management prerogative which is not due to any legal or contractual
obligation.

(C No, because this amounts to a diminution of benefits which is prohibited by the Labor Code.

(D) No, because it is a fringe benefit that has already ripened into a demandable right.

SUGGESTED ANSWER:

(C) No, because this amounts to a diminution of benefits which is prohibited by the Labor
Code.

IV.

Linis Manpower, Inc. (LMI) had provided janitorial services to the Philippine Overseas
Employment Administration (POEA) since March 2009. Its service contract was renewed every
three months. However, in the bidding held in June 2012, LMI was disqualified and excluded. In
2013, six janitors of LMI formerly assigned at POEA filed a complaint for underpayment of
wages. Both LMI and POEA were impleaded as respondents. Should POEA, a government
agency subject to budgetary appropriations from Congress, be held liable solidarily with LMI for
the payment of salary differentials due to the complainant? Cite the legal basis of your answer.
(4%)

SUGGESTED ANSWER:

Yes, but only to the extent of work performed under the contract. The second paragraph of
Art. 106 of the Labor Code provides:
Art. 106. Contractor or subcontractor. – … 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 fact that POEA is a government agency is of no moment. In U.S.A. v. Ruiz (G.R. No.
L-35645, May 22, 1985), the Supreme Court ruled that the State may be sued if the
contract it entered into is pursuant to its proprietary functions.

V.

Liwayway Glass had 600 rank-and-file employees. Three rival unions A, B, and C participated in
the certification elections ordered by the Med-Arbiter. 500 employees voted. The unions
obtained the following votes: A-200; B-150; C-50; 90 employees voted “no union”; and 10 were
segregated votes. Out of the segregated votes, four (4) were cast by probationary employees and
six (6) were cast by dismissed employees whose respective cases are still on appeal. (10%)

(A) Should the votes of the probationary and dismissed

employees be counted in the total votes cast for the purpose of determining the winning labor
union?

SUGGESTED ANSWER:

Yes. Rule IX, Sec. 5 of DOLE Department Order 40-03 provides that “[a]ll employees who
are members of the appropriate bargaining unit sought to be represented by the petitioner
at the time of the issuance of the order granting the conduct of a certification election shall
be eligible to vote. An employee who has been dismissed from work but has contested the
legality of the dismissal in a forum of appropriate jurisdiction at the time of the issuance of
the order for the conduct of a certification election shall be considered a qualified voter,
unless his/ her dismissal was declared valid in a final judgment at the time of the conduct of
the certification election.”

(B) Was there a valid election?

SUGGESTED ANSWER:
Yes. To have a valid election, at least a majority of all eligible voters in the unit must have
cast their votes (Art. 256, now Art. 266, of the Labor Code). In the instant case, 500 out of
600 rank-and-file employees voted.

1. C) Should Union A be declared the winner?

SUGGESTED ANSWER:

No. The Labor Code provides that the Labor Union receiving the majority of the valid
votes cast shall be certified as the exclusive bargaining agent of all the workers in the unit
(Art. 256, now Art. 266, of the Labor Code). Here, the number of valid votes cast is 490;
thus, the winning union should receive at least 246 votes. Union A only received 200 votes.

(D) Suppose the election is declared invalid, which of the

contending unions should represent the rank-and-file employees?

SUGGESTED ANSWER:

None of them should represent the rank-and-file employees (Art. 255, now Art. 265, of the
Labor Code).

(E) Suppose that in the election, the unions obtained

the following votes: A-250; B-150; C-50; 40 voted “no union”; and 10 were segregated votes.
Should Union A be certified as the bargaining representative?

SUGGESTED ANSWER:

Yes. The Labor Code provides that the Labor Union receiving the majority of the valid
votes cast shall be certified as the exclusive bargaining agent of all the workers in the unit
(Art. 256, now Art. 266, of the Labor Code). Here, the number of valid votes cast is 490.
Thus, the winning union should receive at least 246 votes; Union A received 250 votes.

VI.

Lina has been working as a steward with a Miami, U.S.A.-based Loyal Cruise Lines for the past
fifteen (15) years. She was recruited by a local manning agency, Macapagal Shipping, and was
made to sign a ten-month (10) employment contract everytime she left for Miami. Macapagal
Shipping paid for Lina’s round-trip travel expenses from Manila to Miami. Because of a food
poisoning incident which happened during her last cruise assignment, Lina was not re-hired.
Lina claims she has been illegally terminated and seeks separation pay. If you were the Labor
Arbiter handling the case, how would you decide? (4%)

SUGGESTED ANSWER:

I will dismiss Lina’s complaint. Lina is a contractual employee and the length of her
employment is determined by the contracts she entered into. Here, her employment was
terminated at the the expiration of the contract (Millares v. NLRC, G.R. No. 110524, July
29, 2002, 385 SCRA 306, 318).

VII.

Non-lawyers can appear before the Labor Arbiter if: (1%)

(A) they represent themselves

(B) they are properly authorized to represent their legitimate labor organization or member
thereof

(C) they are duly-accredited members of the legal aid office recognized by the DOJ or IBP

(D) they appear in cases involving an amount of less than Php5,000

SUGGESTED ANSWER:

(A) they represent themselves (Art. 222, Labor Code: Rule III, Sec. 6, 2011 NLRC Rules of
Procedure).

VIII.

As a result of a bargaining deadlock between Lazo Corporation and Lazo Employees Union, the
latter staged a strike. During the strike, several employees committed illegal acts. Eventually, its
members informed the company of their intention to return to work. (6%)

(A) Can Lazo Corporation refuse to admit the strikers?

SUGGESTED ANSWER:

No. The commission of illegal acts during a strike does not automatically bring about loss
of employment status. Due process must be observed by the employer before any dismissal
can be made (Stamford Marketing Corp. v. Julian, G.R. No. 145496, February 24, 2004,
423 SCRA 633).

(B) Assuming the company admits the strikers, can it later

on dismiss those employees who committed illegal acts?

SUGGESTED ANSWER:

No. The employer may be considered as having waived its right to dismiss employees who
committed illegal acts during the strike (Reformist Union of R.B. Liner v. NLRC, G.R. No.
120482, January 27, 1997, 266 SCRA 713).

(C) If due to prolonged strike, Lazo Corporation hired replacements, can it refuse to admit the
replaced strikers?

No. Sec. 3, Art. XIII of the Constitution guarantees workers the right to strike in
accordance with law, and prolonged strike is not prohibited by law. With Art. 212 (o)
defining strike as “any temporary stoppage of work as a result of an industrial or labor
dispute, it is the prerogative of strikers to cut short or prolong a strike. By striking, the
employees have not abandoned their employment. Rather, they have only ceased
temporarily from rendering work. The striking employees have not lost their right to go
back to their positions, because the declaration of a strike is not a renunciation of their
employment, much less their employee-employer relationship.

ALTERNATIVE ANSWER:

No. As a general rule, replacements take their employment as conditional, i.e., subject to
the rights of strikers to return to work.

However, since this is an economic strike, the strikers are entitled to reinstatement only in
case Lazo Corporation has not yet hired permanent replacements (Consolidated Labor
Association v. Marsman & Co., G.R. No. L-17038, July 31, 1964, 11 SCRA 589).

 
.

IX.

Luisa Court is a popular chain of motels. It employs over thirty (30) chambermaids who, among
others, help clean and maintain the rooms. These chambermaids are part of the union rank-and-
file employees which has an existing collective bargaining agreement (CBA) with the company.
While the CBA was in force, Luisa Court decided to abolish the position of chambermaids and
outsource the cleaning of the rooms to Malinis Janitorial Services, a bona fide independent
contractor which has invested in substantial equipment and sufficient manpower. The
chambermaids filed a case of illegal dismissal against Luisa Court. In response, the company
argued that the decision to outsource resulted from the new management’s directive to streamline
operations and save on costs.

If you were the Labor Arbiter assigned to the case, how would you decide? (4%)

SUGGESTED ANSWER:

I will decide in favor of Luisa Court, provided that all the requisites for a valid
retrenchment under the Labor Code are satisfied. It is management prerogative to farm
out any of its activities (BPI Employees UnionDavao City-FUBU (BPIEU-Davao City-
FUBU) v. Bank of the Philippine Islands, G.R. No. 174912, July 24, 2013).

ALTERNATIVE ANSWER:

I will decide in favor of the chambermaids. Art. 248 (c) of the Labor Code considers as
unfair labor practice on the part of Luisa Court its “contract out the services or functions
being performed by union members.” Luisa Court’s abolition and act of outsourcing the
chambermaids’ positions are clearly acts of illegal dismissal.

X.

Luisa was hired as a secretary by the Asian Development Bank (ADB) in Manila. Luisa’s first
boss was a Japanese national whom she got along with. But after two years, the latter was
replaced by an arrogant Indian national who did not believe her work output was in accordance
with international standards. One day, Luisa submitted a draft report filled with typographical
errors to her boss. The latter scolded her, but Luisa verbally fought back. The Indian boss
decided to terminate her services right then and there. Luisa filed a case for illegal dismissal with
the Labor Arbiter claiming arbitrariness and denial of due process.
If you were the Labor Arbiter, how would you decide the case? (4%)

SUGGESTED ANSWER:

I will dismiss the case. ADB enjoys immunity from suit (DFA v. NLRC, G.R. No. 113191,
September 18, 1996).

ALTERNATIVE ANSWER:

I will decide in favor of Luisa, by granting nominal damages. To clarify, however, Luisa’s
dismissal is not illegal, for it has been held that failure to observe prescribed standards of
work, or to fulfill reasonable work assignments due to inefficiency, as in this case, may
constitute just cause for dismissal (Iluminada Ver Buiser v. Leogardo, Jr., G.R. No. L-
63316, July 31, 1984, 131 SCRA 15). Nonetheless, the employer’s failure to comply with the
procedure prescribed by law in terminating the services of the employee warrants the
payment of nominal damages of Php 30,000, in accordance with the Supreme Court’s
ruling in the case of Agabon v. NLRC (G.R. No. 158693, November 17, 2004).

XI.

Lionel, an American citizen whose parents migrated to the U.S. from the Philippines, was hired
by JP Morgan in New York as a call center specialist. Hearing about the phenomenal growth of
the call center industry in his parents’ native land, Lionel sought and was granted a transfer as a
call center manager for JP Morgan’s operations in Taguig City. Lionel’s employment contract
did not specify a period for his stay in the Philippines. After three years of working in the
Philippines, Lionel was advised that he was being recalled to New York and being promoted to
the position of director of international call center operations. However, because of certain
“family reasons,” Lionel advised the company of his preference to stay in the Philippines. He
was dismissed by the company. Lionel now seeks your legal advice on: (6%)

SUGGESTED ANSWER:

(A) whether he has a cause of action

Lionel has a cause of action; he was illegally dismissed. Dismissal due to an employee’s
refusal of a promotion is not within the sphere of management prerogative. There is no law
that compels an employee to accept promotion (Dosch v. NLRC, G.R. No. L-51182, July 5,
1983).

(B) whether he can file a case in the Philippines

Yes. Since this is a case of illegal dismissal, the Labor Arbiters have jurisdiction over the
same (Art. 217 (a) (2), Labor Code). Under the 2011 NLRC Rules of Procedure, all cases
which Labor Arbiters have authority to hear and decide, may be filed in the Regional
Arbitration Branch having jurisdiction over the workplace of the complainant or petitioner
(Rule IV, Sec. 1).

(C) what are his chances of winning

He has a big chance of winning. An employee cannot be promoted without his consent, even
if the same is merely a result of a transfer, and an employee’s refusal to accept promotion
cannot be considered as insubordination or willful disobedience of a lawful order of the
employer. In this case, JP Morgan cannot dismiss Lionel due to the latter’s refusal to
accept the promotion (Norkis Trading Co., Inc. v. Gnilo, G.R. No. 159730, February 11,
2008, 544 SCRA 279).

ALTERNATIVE ANSWER:

His chances of winning is nil because the objection to the transfer was grounded solely on
personal “family reasons” that will be caused to him because of the transfer (OSS Security
& Allied Services, Inc. v. NLRC, G.R. No. 112752, February 9, 2000, 325 SCRA 157); Phil.
Industrial Security Agency Corp. v. Dapiton, G.R. No. 127421, December 8, 1999, 320
SCRA 124).

XII.

Which of the following groups does not enjoy the right to self-organization? (1%)

(A) those who work in a non-profit charitable institution

(B) those who are paid on a piece-rate basis

(C) those who work in a corporation with less than ten (10) employees

(D) those who work as legal secretaries

SUGGESTED ANSWER:

(D) those who work as legal secretaries (Tunay na Pagkakaisa ng Manggagawa sa Asia
Brewery v. Asia Brewery, Inc., G.R. No. 162025, August 3, 2010).
 

XIII.

Don Luis, a widower, lived alone in a house with a large garden. One day, he noticed that the
plants in his garden needed trimming. He remembered that Lando, a 17-year old out-of-school
youth, had contacted him in church the other day looking for work. He contacted Lando who
immediately attended to Don Luis’s garden and finished the job in three days. (4%)

(A) Is there an employer-employee relationship between Don Luis and Lando?

SUGGESTED ANSWER:

Yes. All the elements of employer-employee relationship are present, viz: 1. the selection
and engagement of the employee; 2. the power of dismissal; 3. the payment of wages; and 4.
the power to control the employee’s conduct. There was also no showing that Lando has his
own tools, or equipment so as to qualify him as an independent contractor.

ALTERNATIVE ANSWER:

None. Lando is an independent contractor for Don Luis does not exercise control over
Lando’s means and method in tending to the former’s garden.

(B) Does Don Luis need to register Lando with the Social Security System (SSS)?

SUGGESTED ANSWER:

Yes. Coverage in the SSS shall be compulsory upon all employees not over sixty (60) years
of age.

ALTERNATIVE ANSWER:

No. Lando is not an employee of Don Luis. What the parties have is a contract for a piece
of work which. while allowed by Art. 1713 of the Civil Code, does not make Lando an
employee under the Labor Code and Social Security Act.

XIV.

Luisito has been working with Lima Land for twenty vears. Wanting to work in the public sector,
Luisito applied with and was offered a job at Livecor. Before accepting the offer, he wanted to
consult you whether the payments that he and Lima Land had made to the Social Security
System (SSS) can be transferred or credited to the Government Service Insurance System
(GSIS).

What would you advice? (4%)

SUGGESTED ANSWER:

Yes. Under R.A. 7699, otherwise known as the Portability Law, one may combine his years
of service in the private sector represented by his contributions to the Social Security
System (SSS) with his government service and contributions to the GSIS. The contributions
shall be totalized for purposes of old-age, disability, survivorship and other benefits in case
the covered member does not qualify for such benefits in either or both Systems without
totalization.

XV.

Our Lady of Peace Catholic School Teachers and Employees Labor Union (OLPCS-TELU) is a
legitimate labor organization composed of vice-principals, department heads, coordinators,
teachers, and non-teaching personnel of Our Lady of Peace Catholic School (OLPCS).

OLPCS-TELU subsequently filed a petition for certification election among the teaching and
non-teaching personnel of OLPCS before the Bureau of Labor Relations (BLR) of the
Department of Labor and Employment (DOLE). The Med-Arbiter subsequently granted the
petition and ordered the conduct of a joint certification election for the teaching and non-teaching
personnel of OLPCS.

May OLPCS-TELU be considered a legitimate labor organization? (5%)

SUGGESTED ANSWER:

Yes. The facts of the case concede that OLPCS-TELY “is a legitimate labor organization.”

XVI.

Samahang East Gate Enterprises (SEGE) is a labor organization composed of the rank-
and-file employees of East Gate Enterprises (EGE), the leading manufacturer of all types of
gloves and aprons.
EGE was later requested by SEGE to bargain collectively for better terms and conditions of
employment of all the rank-and-file employees of EGE. Consequently, EGE filed a petition for
certification election before the Bureau of Labor Relations (BLR).

During the proceedings, EGE insisted that it should participate in the certification process. EGE
reasoned that since it was the one who filed the petition and considering that the employees
concerned were its own rank-and-file employees, it should be allowed to take an active part in
the certification process.

Is the contention of EGE proper? Explain. (5%)

SUGGESTED ANSWER:

No. Under Art. 258 (a) of the Labor Code, an emploġer is a mere bystander in certification
elections, whether the petition for certification election is filed by said employer or a
legitimate labor organization. The employer shall not be considered a party thereto with a
concomitant right to oppose a petition for certification election.

XVII.

Philhealth is a government-owned and controlled corporation employing thousands of Filipinos.

Because of the desire of the employees of Philhealth to obtain better terms and conditions of
employment from the government, they formed the Philhealth Employees Association (PEA) and
demanded Philhealth to enter into negotiations with PEA regarding terms and conditions of
employment which are not fixed by law. (4%)

(A) Are the employees of Philhealth allowed to self-organize and form PEA and thereafter
demand Philhealth to enter into negotiations with PEA for better terms and conditions of
employment?

SUGGESTED ANSWER:

Yes. Employees of Philhealth are allowed to selforganize under Sec. 8, Art. III and Sec. 3,
Art. XIII of the Constitution which recognize the rights of all workers to self-organization.
They cannot demand, however, for better terms and conditions of employment for the
same are fixed by law (Art. 244, Labor Code), besides, their salaries are standardized by
Congress (Art. 276, Labor Code).

(B) In case of unresolved grievances, can PEA resort to strikes, walkouts, and other temporary
work stoppages to pressure the government to accede to their demands?
SUGGESTED ANSWER:

No. Since the terms and conditions of government employment are fixed by law,
government workers cannot use the same weapons employed by workers in the private
sector to secure concessions from their employers (Blaquera v. Alcala, G.R. Nos. 109406.
110642, 111494, 112056, 119597, September 11, 1998).

XVIII.

The procedural requirements of a valid strike include: (1%)

(A) a claim of either unfair labor practice or deadlock in collective bargaining

(B) notice of strike filed at least fifteen (15) days before a ULP-grounded strike or at least thirty
(30) days prior to the deadlock in a bargaining-grounded strike

(C) majority of the union membership must have voted to stage the strike with notice thereon
furnished to the National Conciliation and Mediation Board (NCMB) at least twenty-four (24)
hours before the strike vote is taken

(D) strike vote results must be furnished to the NCMB at least seven (7) days before the intended
strike

SUGGESTED ANSWER:

(B) notice of strike filed at least fifteen (15) days before a ULP-grounded strike or at least
thirty (30) days prior to the deadlock in a bargaining-grounded strike (Art. 263 (c), Labor
Code).

ALTERNATIVE ANSWER:

(C).majority of the union membership must have voted to stage the strike with notice
thereon furnished to the National Conciliation and Mediation Board(NCMB) at least 24
hours before the strike vote is taken (Art. 263 (f), Labor Code).

(D) strike vote results must be furnished to the NCMB at least seven (7) days before the
intended strike (Art. 263 (f), Labor Code).

 
 XIX.

Lincoln was in the business of trading broadcast equipment used by television and radio
networks. He employed Lionel as his agent. Subsequently, Lincoln set up Liberty
Communications to formally engage in the same business. He requested Lionel to be one of the
incorporators and assigned to him 100 Liberty shares. Lionel was also given the title Assistant
Vice-President for Sales and Head of Technical Coordination. After several months, there were
allegations that Lionel was engaged in “under the table dealings” and received “confidential
commissions” from Liberty’s clients and suppliers. He was, therefore, charged with serious
misconduct and willful breach of trust, and was given fortyeight (48) hours to present his
explanation on the charges. Lionel was unable to comply with the 48-hour deadline and was
subsequently barred from entering company premises. Lionel then filed a complaint with the
Labor Arbiter claiming constructive dismissal. Among others, the company sought the dismissal
of the complaint alleging that the case involved an intra-corporate controversy which was within
the jurisdiction of the Regional Trial Court (RTC).

If you were the Labor Arbiter assigned to the case, how would you rule on the company’s motion
to dismiss? (5%)

SUGGESTED ANSWER:

I will deny the motion to dismiss. “Corporate officers” in the context of Presidential Decree
No. 902-A are those officers of the corporation who are given that character by the
Corporation Code or by the corporation’s by-laws. Sec. 25 of the Corporation Code
enumerates three specific officers that in law are considered as corporate officers – the
president, secretary and the treasurer. Lincoln is not one of them. There is likewise no
showing that his position as Assistant Vice-President is a corporate officer in the
company’s by-laws. The Labor Arbiter therefore, has jurisdiction over the case (Art. 217
(a) (2), Labor Code).

XX.

Lito was anticipating the bonus he would receive for 2013. Aside from the 13th month pay, the
company has been awarding him and his other co-employees a two to three months bonus for the
last ten (10) years. However, because of poor over-all sales performance for the year, the
company unilaterally decided to pay only a one month bonus in 2013. (4%)

Is Lito’s employer legally allowed to reduce the bonus?

SUGGESTED ANSWER:
Yes. A bonus is an act of generosity granted by an enlightened employer to spur the
employee to greater efforts for the success of the business and realization of bigger profits.
The granting of a bonus is a management prerogative, something given in addition to what
is ordinarily received by or strictly due the recipient. Thus, a bonus is not a demandable
and enforceable obligation, except when it is made part of the wage, salary or
compensation of the employee. It may, therefore, be withdrawn, unless they have been
made a part of the wage or salary or compensation of the employees, a matter which is not
in the facts of the case (American Wire and Cable Daily Rated Employees Union v.
American Wire and Cable Co., Inc., G.R. No. 155059, April 29, 2005).

ALTERNATIVE ANSWER:

No. Having been enjoyed for the last ten (10) years, the granting of the bonus has ripened
into a company practice or policy which can no longer be peremptorily withdrawn. Art.
100 of the Labor Code prohibits the diminution or elimination by the employer of the
employees’ existing benefits.

XXI.

An accidental fire gutted the JKL factory in Caloocan. JKL decided to suspend operations and
requested its employees to stop reporting for work. After six (6) months, JKL resumed
operations but hired a new set of employees. The old set of employees filed a case for illegal
dismissal.

If you were the Labor Arbiter, how would you decide the case? (4%)

SUGGESTED ANSWER:

I will rule in favor of the employees. JKL factory merely suspended its operations as a
result of the fire that gutted its factory. Art. 286 of the Labor Code states that an employer
may bona fide suspend the operation of its business for a period not exceeding six (6)
months. In such a case, there would be no termination of the employment of the employees,
but only a temporary displacement. Since the suspension of work lasted more than six
months, there is now constructive dismissal (Sebuguero v. NLRC, G.R. No. 115394,
September 27, 1995, 245 SCRA 532).

XXII.
Despite a reinstatement order, an employer may choose not to reinstate an employee if: (1%)

(A) there is a strained employer-employee relationship

(B) the position of the employee no longer exists

(C) the employer’s business has been closed

(D) the employee does not wish to be reinstated.

SUGGESTED ANSWER:

(D) the employee does not wish to be reinstated (DUP Sound Phils. v. CA, G.R. No. 168317,
November 21, 2011).

XXIII.

Luningning Foods engaged the services of Lamitan Manpower, Inc., a bona fide independent
contractor, to provide “tasters” that will check on food quality. Subsequently, these “tasters”
joined the union of rank-and-file employees of Luningning and demanded that they be made
regular employees of the latter as they are performing functions necessary and desirable to
operate the company’s business. Luningning rejected the demand for regularization. On behalf of
the “tasters,” the union then filed a notice of strike with the Department of Labor and
Employment (DOLE). In response, Luningning sought a restraining order from the Regional
Trial Court (RTC) arguing that the DOLE does not have jurisdiction over the case since it does
not have an employer-employee relationship with the employees of an independent contractor.

If you were the RTC judge, would you issue a restraining order against the union? (4%)

SUGGESTED ANSWER:

Yes. There is no labor dispute in the instant case. Since Lamitan Manpower is a bona fide
independent contractor, there is no employee-employer relationship between the
Luningning and the tasters.

ALTERNATIVE ANSWER:
No. Art. 254 of the Labor Code is clear that no temporary or permanent injunction or
restraining order in any case involving or growing out of labor disputes shall be issued by
any court or other entity, except as provided in Article 218 and 264 of the same Code.

XXIV.

Lanz was a strict and unpopular Vice-President for Sales of Lobinsons Land. One day, Lanz
shouted invectives against Lee, a poor performing sales associate, calling him, among others, a
“brown monkey.” Hurt, Lee decided to file a criminal complaint for grave defamation against
Lanz. The prosecutor found probable cause and filed an information in court. Lobinsons decided
to terminate Lanz for committing a potential crime and other illegal acts prejudicial to business.
Can Lanz be legally terminated by the company on these grounds? (4%)

SUGGESTED ANSWER:

No. The grounds relied upon by Lobinsons are not just causes for dismissal under the
Labor Code. Defamation is not a crime against person which is a ground to dismiss under
Art. 282, now Art. 295 (d) of the Labor Code.

XXV.

Lizzy Lu is a sales associate for Luna Properties. The latter is looking to retrench Lizzy and five
other sales associates due to financial losses. Aside from a basic monthly salary, Lizzy and her
colleagues receive commissions on the sales they make as well as cost of living and
representation allowances. In computing Lizzy’s separation pay, Luna Properties should consider
her: (1%)

(A) monthly salary only

(B) monthly salary plus sales commissions

(C) monthly salary plus sales commissions, plus cost of living allowance

(D) monthly salary plus sales commissions, plus cost of living allowance and representation
allowance

SUGGESTED ANSWER:

(D) monthly salary plus sales commissions, plus cost of living allowance and representation
allowance (Songco v. NLRC, G.R. No. L-50999, March 23, 1990).
 

XXVI.

Liwanag Corporation is engaged in the power generation business. A stalemate was reached
during the collective bargaining negotiations between its management and the union. After
following all the requisites provided by law, the union decided to stage a strike. The management
sought the assistance of the Secretary of Labor and Employment, who assumed jurisdiction over
the strike and issued a return-to-work order. The union defied the latter and continued the strike.
Without providing any notice, Liwanag Corporation declared everyone who participated in the
strike as having lost their employment. (4%)

(A) Was Liwanag Corporation’s action valid?

SUGGESTED ANSWER:

Yes. A strike that is undertaken despite the issuance by the Secretary of Labor of an
assumption or certification order becomes an illegal act committed in the course of a strike.
It rendered the strike illegal. The Union officers and members, as a result, are deemed to
have lost their employment status for having knowingly participated in an illegal act
(Union of Filipro Employees (UFE) v. Nestle Philippines, Inc., G.R. Nos. 88710-13,
December 19, 1990, 192 SCRA 396). Such kind of dismissal under Art. 264 can
immediately be resorted to as an exercise of management prerogative (Biflex Phils., Inc. v.
Filflex Industrial & Manufacturing Corp., G.R. No. 155679, December 19, 2006, 511 SCRA
247).

ALTERNATIVE ANSWER:

No. Liwanag Corporation cannot outrightly declare the defiant strikers to have lost their
employment status. “(A)s in other termination cases,” the strikers are entitled to due
process protection under Art. 277 (b) of the Labor Code. Nothing in Art. 264 of the Code
authorizes immediate dismissal of those who commit illegal acts during a strike (Stamford
Marketing Corp. V. Julian, G.R. No. 145496, February 24, 2004, 423 SCRA 633; Suico v.
NLRC, G.R. No. 146762, January 30, 2007, 513 SCRA 325).

(B) If, before the DOLE Secretary assumed jurisdiction, the striking union members
communicated in writing their desire to return to work, which offer Liwanag Corporation refused
to accept, what remedy, if any, does the union have?

SUGGESTED ANSWER:

File a case for illegal dismissal [Art. 217 (a) (2), Labor Code]
 XXVII.

The jurisdiction of the National Labor Relations Commission does not include: (1%)

(A) exclusive appellate jurisdiction over all cases decided

by the Labor Arbiter (B) exclusive appellate jurisdiction over all cases decided

by Regional Directors or hearing officers involving the recovery of wages and other monetary
claims and benefits arising from employer-employee relations where the aggregate money claim
of each does not exceed five

thousand pesos (P5,000) (C) original jurisdiction to act as a compulsory arbitration

body over labor disputes certified to it by the Regional

Directors (D) power to issue a labor injunction

SUGGESTED ANSWER:

(C) original jurisdiction to act as a compulsory arbitration body over labor disputes
certified to it by the Regional Directors (Art. 129, Labor Code).

SUGGESTED ANSWERS TO THE 2017 BAR EXAMINATION QUESTIONS IN LABOR & SOCIAL LEGISLATION

I.
A.

What are the accepted tests to determine the existence of an employer employee relationship?
(5%)

SUGGESTED ANSWER 
The accepted tests to determine the existence of an employer employee relationship are: 
A) Four-fold Test:

1. The selection and engagement of the employees;

2. The payment of wages
3. The power of dismissal; and
 4. The power to control the employees’ conduct (The Manila Hotel Corp. v. NLRC, G.R.
No. 154591, March 5, 2007, 343 SCRA 1).

The most important test is the element of control, which has been defined as the “right to control
not only the end to be achieved but also the means to be used in reaching such end” (LVN
Pictures v. Philippine Musicians Guild, G.R. No. L-12582, January 28, 1961, 1 SCRA 132).

B) Economic reality Test: 

The Supreme Court has also used the economic reality test, where the economic realities
prevailing within the activity or between the parties are examined, taking into consideration the
totality of circumstances surrounding the true nature of the relationship between the parties
(Orozco v. Court of Appeals, G.R. No. 155207, August 13, 2008, 562 SCRA 36).

B.
Applying the tests to determine the existence of an employer employee relationship, is a jeepney
driver operating under the boundary system an employee of his jeepney operator or a mere lessee
of the jeepney? Explain your answer. (3%)

SUGGESTED ANSWER

The jeepney driver operating under the boundary system is an employee of the jeepney operator,
not a mere lessee. The jeepney operator exercises supervision and control over the jeepney
driver. The jeepney operator, as holder of the certificate of public convenience, must see to it that
the jeepney driver follows the route prescribed by the franchising authority and the rules
promulgated as regards its operation. Moreover, jeepney drivers perform activities which are
usually necessary or desirable in the usual business or trade of the jeepney operator (Jardin, et al.
v. NLRC, G.R. No. 119268, February 23, 2000, 326 SCRA 299).

II.

Procopio was dismissed from employment for stealing his co employee Raul’s watch. Procopio
filed a complaint for illegal dismissal. The Labor Arbiter ruled in Procopio’s favor on the ground
that Raul’s testimony was doubtful, and, therefore, the doubt should be resolved in favor of
Procopio. On appeal, the NLRC reversed the ruling because Article 4 of the Labor Code – which
states that all doubts in the interpretation and implementation of the provisions of the Labor
Code, including the implementing rules and regulations, shall be resolved in favor of labor –
applied only when the doubt involved the “implementation and interpretation” of the Labor
Code; hence, the doubt, which involved the application of the rules on evidence, not the Labor
Code, could not necessarily be resolved in favor of Procopio. Was the reversal correct? Explain
your answer. (3%)

SUGGESTED ANSWER 
The reversal is not correct. It is a time-honored rule that in controversies between a laborer and
his master, doubts reasonably arising from the evidence, or in the interpretation of agreement and
writings, should be resolved in the former’s favor (Lepanto Consolidated Mining Company v.
Dumapis, G.R. No. 163210, August 13, 2008, 562 SCRA 103). There appears to be serious
doubts in the evidence on record as to the factual basis of the charges against Procopio. These
doubts should be resolved in his favor in line with the policy under the Labor Code to afford
protection to labor and construe doubts in favor of labor (Asuncion v. NLRC, G.R. No. 129329,
July 31, 2001, 362 SCRA 56).

ALTERNATIVE ANSWER 
The reversal is not correct. Article 227 (221) of the Labor Code clearly provides that “the rules
of evidence prevailing in courts of law shall not be controlling” in any proceeding before the
NLRC or the Labor Arbiters. Moreover, the NLRC/Labor Arbiters are mandated to use every
and all reasonable means to ascertain the facts speedily and objectively and without regard to
technicalities of law or procedure, all in the interest of due process.

III.
A.

Andrew Manning Agency (AMA) recruited Feliciano for employment by Invictus Shipping, its
foreign principal. Meantime, AMA and Invictus Shipping terminated their agency agreement.
Upon his repatriation following his premature termination, Feliciano claimed from AMA and
Invictus Shipping the payment of his salaries and benefits for the unserved portion of the
contract. AMA denied liability on the ground that it no longer had an agency agreement with
Invictus Shipping. Is AMA correct? Explain your answer. (3%)

SUGGESTED ANSWER 
AMA is not correct. The liability of the principal/employer and the recruitment/placement
agency is joint and several. Such liability shall continue during the entire period or duration of
the employment contract and shall not be affected by any substitution, amendment or
modification made locally or in a foreign country of the said contract (Section 10, Rep. Act No.
8042, as amended by Section 7 of Rep. Act No. 10022). 
The fact that AMA and its foreign principal have already terminated their agency agreement does
not relieve the former of its fiability, because the obligations covenanted in the agency
agreement between the local agent and its foreign principal are not coterminous with the term of
such agreement so that if either or both of the parties decide to end the agreement, the
responsibilities of such parties towards the contracted employees under the agreement do not at
all end, but the same extends up to and until the expiration of the employment contracts of the
employees recruited and employed pursuant to said recruitment agreement; otherwise, this will
render nugatory the very purpose which the law governing the employment of workers for
foreign jobs’ abroad was enacted (Catan v. NLRC, G.R. No. 77279, April 15, 1988, 160 SCRA
691).

B. 
As a rule, direct hiring of migrant workers is not allowed. What are the exceptions? Explain your
answer. (2.5%)

SUGGESTED ANSWER 
The exceptions are: direct hiring by members of the diplomatic organizations, international
organizations, heads of state and government officials with the rank of at least deputy minister,
and such other employers as may be allowed by the Secretary of Labor (Book I, Title 1, Chapter
1, Article 18, Labor Code). The reasons for the ban on direct hiring are:

A worker hired directly by a foreign employer without government intervention may not be
assured of the best possible terms and conditions of employment. 
A foreign employer must also be protected. Without government intervention, a foreign
employer may be entering into a contract with a Filipino who is not qualified to do the job. 
The mandatory requirement for remittance to the Philippines of a portion of the worker’s foreign
exchange earnings can easily be evaded by the worker.

C.

Phil, a resident alien, sought employment in the Philippines. The employer, noticing that Phil
was a foreigner, demanded that he first secures an employment permit from the DOLE. Is the
employer correct? Explain your answer. (2.5%)

SUGGESTED ANSWER 
No, the employer is not correct. Only non-resident aliens seeking admission to the Philippines
are required to obtain an employment permit from the Department of Labor and Employment
(Article 40, Labor Code).

ALTERNATIVE ANSWER 
The employer is not correct. Under DOLE Department Order No. 75-06, resident foreign
nationals are exempted from securing an employment permit.

IV.
The Regional Tripartite Wages and Productivity Board (RTWPB) for Region 3 issued a wage
order on November 2, 2017 fixing the minimum wages for all industries throughout Region 3. 
(a) Is the wage order subject to the approval of the National Wages and Productivity
Commission before it takes effect? (2%)

SUGGESTED ANSWER 
(a) No, because the NWPC exercises only technical and administrative supervision over the
RTWPB (Article 121(g), Labor Code).

ALTERNATIVE ANSWER 
(a) No, the Wage Order becomes effective fifteen (15) days after its publication in at least one
(1) newspaper of general circulation in the region pursuant to the Rules of Procedure in
Minimum Wage Fixing.

ANOTHER ALTERNATIVE ANSWER 

(a) Yes. In NWPC v. Alliance of Progressive Labor (G.R. No. 150326, March 12, 2014), it was
ruled that “(t)he very fact that the validity of the assailed sections of Wage Order No. NCR-07
had been already passed upon and upheld by the NWPC meant that the NWPC had already given
the wage order its necessary legal imprimatur. Accordingly, the requisite approval or review was
complied with.”

(b) The law mandates that no petition for wage increase shall be entertained within a period of 12
months from the effectivity of the wage order. Under what circumstances may the Kilusang
Walang Takot, a federation of labor organizations that publicly and openly assails the wage order
as blatantly unjust, initiate the review of the wage increases under the wage order without
waiting for the end of the 12-month period? Explain your answer. (3%)

SUGGESTED ANSWER 
(b) The federation may initiate a review of the wage order even before the expiration of the 12
month period when there are supervening conditions, such as extraordinary increase in prices of
petroleum products and basic goods/services which demand a review of minimum wage rates as
determined by the Board and confirmed by the 
Commission.

V.
A.

Percival was a mechanic of Pacific Airlines. He enjoyed a meal break of one hour. However,
during meal breaks, he was required to be on stand-by for emergency work. During emergencies,
he was made to forego his meals or to hurry up eating. He demanded payment of overtime for
work done during his meal periods. Is Percival correct? Explain your answer. (3%)

SUGGESTED ANSWER 
Percival is correct. Under Article 85 of the Labor Code and Book III, Rule I, Section 7 of the
Rules, it shall be the duty of every employer to give his employees not less than sixty (60)
minutes time-off for their regular meals. But where during the meal break, the workers are
required to stand by for emergency work, such period is considered overtime (Pan American
World Airways System (Phil.) v. Pan American Employees Association, G.R. No. L-16275,
February 23, 1961, 1 SCRA 527).

ALTERNATIVE ANSWER 
Percival is correct. All the time during which an employee is required to be on duty or to be at
the employer’s premises or to be at a prescribed work place, and all time during which an
employee is suffered or permitted to work is considered compensable hours. Given that
Percival’s meal break was not one of complete rest, as he did not have the freedom to devote
such period for his personal needs, the same should be considered as compensable hours of
work.

B.
Distinguish a learner from an apprentice. (4%)

SUGGESTED ANSWER 

As to nature: a learner trains in a semi-skilled job; whereas, an apprentice trains in a highly

technical job. 

As to period: a learner is for three months; whereas, an apprentice is not less than three months
but not more than six months, as a rule. 

As to commitment to employ: For a learner, there is a commitment to employ the learner, as

regular employees if he so desire, upon completion of the learnership; whereas, for an
apprentice, there is no such commitment. 

As to necessity of TESDA approval: For a learner, TESDA approval is not necessary, only
TESDA inspection is required; whereas, for an apprentice, prior approval by TESDA is
required. 

As to deductibility of expenses: For a learner, there is no provision for deductibility of expenses;

whereas, for an apprentice, expenses of training are deductible from income tax. 
As to compensation: a learner has compensation; whereas, an apprentice has none if DOLE
authorizes, as when OJT is required by the school.

C.

Are there differences between a househelper and a homeworker? Explain your answer. (4%)

SUGGESTED ANSWER 
Househelper refers to any person, whether male or female, who renders services in and about the
employer’s home and which services are usually necessary or desirable for the maintenance and
enjoyment thereof, and ministers exclusively to the personal comfort and enjoyment of the
employer’s family (Rule XIII, Section 1(b), Book 3, Labor Code; Apex Mining Company, Inc. v.
NLRC, G.R. No. 94951, April 22, 1991, 196 SCRA 251), homeworker, on the other hand, is one
who works in a system of production under an employer or contractor whose job is carried out at
his/her home, the materials of which may or may not be furnished by the employer or contractor
(Department Order No. 005-92).

The househelper is covered by the Kasambahay Law; whereas, the homeworker is subject to the
provisions of Book III of the Labor Code. The househelper works in another person’s home;
whereas, the homeworker does his job in the confines of his own home. The househelper has a
definite employer while the homeworker has none. The househelper has security of tenure,
which the homeworker does not have.

VI.
A.

One of Pacific Airline’s policies was to hire only single applicants as flight attendants, and
considered as automatically resigned the flight attendants at the moment they got married. Is the
policy valid? Explain your answer. (2.5%) 
SUGGESTED ANSWER:
The policy is not valid. It violates the provisions of Article 136. (now Article 134) of the Labor
Code on stipulations against marriage, to wit: “It shall be unlawful for an employer to require as
a condition of employment or continuation of employment that a woman emploves 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.”

B.
 1. Tarcisio was employed as operations manager and received a monthly salary of
P25,000.00 through his payroll account with DB Bank. He obtained a loan from Roberto to
purchase a car. Tarcisio failed to pay Roberto when the loan fell due. Roberto sued to
collect, and moved to garnish Tarcisio’s payroll account. The latter vigorously objected
and argued that salaries were exempt from garnishment. Is Tarcisio correct? Explain your
answer. (3%) 
SUGGESTED ANSWER

No, Tarcisio is not correct. Case law exempts wages of rank and-file employees from
garnishment. Tarcisio, however as operations manager, is a managerial employee. Since the rule
covers only rank-and file employees, therefore, Tarcisio’s salary is not exempt from garnishment
(Gaa v. Court of Appeals, G.R. No. L-44169, December 3, 1985, 140 SCRA 304).

ALTERNATIVE ANSWER 
Yes, Tarcisio is correct. Under Article 1708 of the Civil Code, “(t). he laborer’s wages shall not
be subject to execution or attachment, except for debts incurred for food, shelter, clothing and
medical attendance.” The indebtedness of Tarcisio was due to a purchase of a car which is nou
one of the exceptions under the said law.

ANOTHER ALTERNATIVE ANSWER

Garnishment, which is a species of attachment requires that debtor (Tarcisio) is insolvent.

VII

Dr. Crisostomo entered into a retainer agreement with AB Hotel and Resort whereby he would
provide medical services to the guests and employees of AB Hoteland Resort, which, in turn,
would provide the clinic premises and medical supplies. He received a monthly retainer fee of
P60,000.00, plus a 70% share in the service charges from AB Hoteland Resort’s guests availing
themselves of the clinic’s services. The clinic employed nurses and allied staff, whose salaries,
SSS contributions and other benefits he undertook to pay. AB Hotel and Resort issued directives
giving instructions to him on the replenishment of emergency kits and forbidding the clinic staff
from receiving cash payments from the guests. 
In time, the nurses and the clinic staff claimed entitlement to rights as regular employees of AB
Hoteland Resort, but the latter refused on the ground that Dr. Crisostomo, who was their
employer, was an independent contractor. Rule, with reasons. (4%)

SUGGESTED ANSWER 
I will rule in favor of AB Hoteland Resort. Applying the Four Fold Test will readily show that
the real employer of the nurses and the clinic staff is Dr. Crisostomo and not AB Hoteland
Resort, viz: (1) the selection and engagement of the nurses and clinic staff were made by Dr.
Crisostomo; (2) their wages were paid by Dr. Crisostomo. As a matter of fact, SSS contributions
were paid by him which, by itself, is already an indication that he is the employer. Although he
did not exercise the power of dismissal, it can be said that as the doctor, he has the control, of his
employees’ conduct in the dispensing of medical services to the guests and personnel of the
resort. The fact that AB Hoteland Resort gave instructions to him regarding replenishment of
emergency kits and forbidding his staff from receiving cash payments from guests is of no
consequence. They are nothing more but guidelines which will not create an employer-employee
relationship (Insular Life Co., Ltd. v. NLRC, G.R. No. 84484, November 15, 1989, 179 SCRA
459).

ALTERNATIVE ANSWER

I will rule in favor of the employees. In the case of Samonte v. La Salle Greenhills, Inc. (G.R.
No. 199683, February 10, 2016), the Court held that “Time and again, we have held that the
power of control refers to the existence of the power and not necessarily to the actual exercise
thereof, nor is it essential for the employer to actually supervise the performance of duties of the
employee. It is enough that the employer has the right to wield that power.” Such power is
present in the hands of AB Hoteland Resort. 

VIII

Marciano was hired as Chief Engineer on board the vessel M/V Australia. His contract of
employment was for nine months. After nine months, he was re-hired. He was hired a third time
after another nine months. He now claims entitlement to the benefits of a regular employee based
on his having performed tasks usually necessary and desirable to the employer’s’ business for a
continuous period of more than one year. Is Marciano’s claim tenable? Explain your answer.
(3%)

SUGGESTED ANSWER 
No. Marciano’s claim is not tenable. Seafarers are contractual employees for a fixed term,
governed by the contracts they sign. We should not depart from the rulings of the Supreme Court
in Brent School, Inc. v. Zamora (G.R. No. L-48494, February 5, 1990, 181 SCRA 702); Covoca
v. NLRC (G.R. No. 113658, March 31, 1995, 243 SCRA 190); and Millares v. NLRC (G.R. No.
110524, July 29, 2002, 385 SCRA 306), which constitute stare decisis with respect to the
employment status of seafarers as contractual employees, not regular employees,
notwithstanding performance of usually necessary and desirable functions which exceed one
year or continuous rehiring.

IX
Section 255 (245) of the Labor Code recognizes three categories of employees, namely:
managerial, supervisory, and rank-and-file. 
(a) Give the characteristics of each category of employees, and state whether the employees in
each category may organize and form unions. Explain your answer. (5%) 
SUGGESTED ANSWER

1 
(a) Managerial employees – those vested with powers or prerogatives to lay down and execute
management policies and/or to hire, transfer, suspend, lay-off, recall employees (Article 219
1212), par. m, Labor Code) Managerial employees cannot join, assist or form unions (Article 255
(245), Labor Code). 

Supervisory employees – those who, in the interest of management, effectively recommend such
managerial actions if the exercise of such authority is not merely routine or clerical in nature, but
requires use of independent judgment (Article 219 (212), par, m, Labor Code). Supervisory
employees are not eligible for membership in a labor organization of rank-and-file employees
but may join, assist, or form separate labor organizations of their own (Art. 255 [245], Labor
Code). 

Rank-and-file employees – all other employees not falling within the definition of “managerial”
or “supervisory” employees are considered rank-and-file employees (Article 219 [212], par. m,
Labor Code). Rank and-file employees have the right to form, join or assist unions of their own
choosing (Art. 253 [243], Labor Code);

(b) May confidential employees who assist managerial employees, and who act in a confidential
capacity or have access to confidential matters being handled by persons exercising managerial
functions in the held of labor relations form, or assist, or join labor unions? Explain your answer.
(2.5%) 
SUGGESTED ANSWER

(b) No, these confidential employees cannot form, assist, or join labor unions. The exclusion
from bargaining units of employees who, in the general course of their duties, become aware of
management policies relating to labor relations is founded upon the confidential employee rule”.
The rationale behind this rule is that employees should not be placed in a position involving a
potential conflict of interests. Management should not be required to handle labor relation
matters through employees who are represented by the union with which the company is required
to deal and who in the normal performance of their duties may obtain advance information of the
company’s position with regard to contract negotiations, the disposition of grievances or other
labor relations matters (San Miguel Corporation Supervisor and Exempt Employees Union v.
Laguesma, G.R. No. 110399, August 15, 1997, 277 SCRA 370).
ALTERNATIVE ANSWER 
(b) No. Under the doctrine of necessary implication, same reason for the disqualification of
managerial employees app! confidential employees (Pepsi-Cola Products Phil., Inc. v. Sec. oj bu
G.R. Nos. 96693 and 103300, August 10, 1999, 312 SCRA 104).

X. 
A.

The labor sector has been loudly agitating for the end of labor-only contracting, as distinguished
from job contracting. Explain these two kinds of labor contracting, and give the effect of a
finding that one is a labor-only contractor. Explain your answers. (4%)

SUGGESTED ANSWER 
There is labor-only contracting where: (1) 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 (2) the workers recruited and placed by such person are performing
activities which are directly related to the principal business of such employer (Baguio v. NLRC,
G.R. Nos. 79004-08, October 4, 1991, 202 SCRA 465; Art. 106, Labor Code). 
There is job contracting where: (1) the contractor carries on an independent business and
undertakes the contract work on his own account under his own responsibility according to his
own manner and method, free from the control and direction of his principal in all matters
connected with the performance of the work except as to the results thereof; and (2) the
contractor has substantial capital or investment in the form of tools, equipment, machineries,
work premises, and other materials which are necessary in the conduct of his business (Baguio v.
NLRC, G.R. Nos. 79004-108, October 4, 1991, 202 SCRA 465). 
A finding that a contractor is a labor-only contractor is equivalent to a declaration that there is an
employer-employee relationship between the principal and the employees of the labor-only
contractor (Industrial Timber Corp. v. NLRC, G.R. No. 83616, January 20, 1989, 169 SCRA
341). In such a case, the person or intermediary shall be considered merely as an agent of the
employer, who shall be responsible to the workers in the manner and extent as if the latter were
directly employed by him (Sandoval Shipyards, Inc. v. Prisco Pepito, G.R. No. 143428, June 25,
2001, 359 SCRA 555). The liability of the principal vis-à-vis the employees of the labor-only
contractor is comprehensive, i.e., not only for unpaid wages but for all claims under the Labor
Code and ancillary laws (San Miguel Corporation v. MAERC Integrated Services, Inc., G.R. No.
144672, July 10, 2003, 405 SCRA 579).

B. 
What are the grounds for validly terminating the services of an employee based on a just cause?
(5%)
SUGGESTED ANSWER 
Article 296 of the Labor Code (formerly Article 282) provides for the termination of the services
of an employee for just causes. 
An employer may terminate an employment for any of the following causes: 
(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his
employer or representative in connection with his work; 
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of the trust reposed in him by his employer or duly
authorized representative; 
(d) Commission of a crime or offense by the employee against the person of his employer or any
immediate member of his family or his duly authorized representatives; and 
e) Other causes analogous to the foregoing.

C.
Give the procedure to be observed for validly terminating the services of an employee based on a
just cause? (4%)

SUGGESTED ANSWER 
Procedural due process mandates that the twin requirements of Notice and Hearing should be
present. The two notices are as follows: 
1st notice: Notice of appraisal, which is a written notice served on the employee specifying the
ground or grounds of termination, and giving the employee reasonable opportunity within which
to explain his side. 
2nd notice: Notice of termination, which is a written notice of termination served upon the
employee, indicating that upon due consideration of all the circumstances, grounds have been
established to justify his termination.

The first notice should contain a detailed narration of facts and circumstances that will serve as
basis for the charge or specific causes or ground for termination against the employee, and a
directive that the employee is given the opportunity to submit his written explanation within a
reasonable period (Unilever Phil. v. Maria Ruby Rivera, G.R. No. 201701, June 3, 2013, 697
SCRA 136). This is to enable the employee to intelligently prepare his explanation and defenses. 
A general description of the charge will not suffice. The notice should specifically mention
which company rules, if any, are violated (King of Kings Transport, Inc. v. Mamac, G.R. No.
166208, June 29, 2007, 526 SCRA 116), and that the employer seeks his dismissal for the act or
omission charged against him; otherwise, the notice does not comply with the rules (Magro
Placement and General Services v. Hernandez, G.R. No. 156964, July 4, 2007, 526 SCRA 408;
see also Mercury Drug Corporation: V. Serrano, G.R. No. 160509, March 10, 2006, 484 SCRA
434; citing Maquiling v. Philippine Tuberculosis Society, Inc., G.R. No. 143384, February 4,
2005, 450 SCRA 465). 
“Reasonable opportunity” under the Omnibus Rules means every kind of assistance that
management must accord to the employee to enable him to prepare adequately for his defense.
This should be construed as a period of at least five (5) calendar days from receipt of the notice
to give the employee an opportunity to study the accusation against him, consult a union official
or lawyer, gather data and evidence, and decide on the defenses he will raise against the
complaint (King of Kings Transport, Inc. v. Mamac, G.R. No. 166208, June 29, 2007, 526
SCRA 116). 
After receiving the first notice apprising him of the charges against him, the employee may
submit a written explanation (which may be in the form of a letter, memorandum, affidavit or
position paper) and offer evidence in support thereof, like relevant company records (such as his
201 file and daily time records) and the sworn statements of his witnesses.

For this purpose, he may prepare his explanation personally or with the assistance of a
representative or counsel. He may also ask the employer to provide him copy of records material
to his defense. His written explanation may also include a request that a formal hearing or
conference be held. 
In such a case, the conduct of a formal hearing or conference becomes mandatory, as where there
exist substantial evidentiary disputes or where company rules or practice requires an actual
hearing as part of employment pre-termination procedure (Perez V. Philippine Telegraph and
Telephone Company, G.R. No. 152048, April 7, 2009, 584 SCRA 110).

XI.
A.

The modes of determining the exclusive bargaining agent of the employees in a business are: (a)
voluntary recognition; (b) certification election; and (c) consent election. Explain how they differ
from one another. (4%)

SUGGESTED ANSWER 
Voluntary Recognition: An employer may voluntarily recognize the representation status of a
labor union if the establishment is unorganized and has only one legitimate labor organization.
Such voluntary recognition, accompanied by supporting documents, should be submitted to the
Regional Office, which issued the labor union’s certificate of registration. 
Certification Election: This is the process by which a legitimate labor organization or the
employer may file a petition for certification election to determine the choice of an exclusive
collective bargaining agent of the employees. A med-arbiter shall automatically order a
certification election by secret ballot when a petition is filed (1) in an unorgànized establishment
or (2) in an organized establishment where the petition is supported by at least 25% of all
employees in the bargaining unit. To have a valid certification election, at least a majority of all
eligible votes in the bargaining unit must have cast their votes. The labor union receiving the
majority of the valid votes cast shall be certified as the exclusive bargaining agent of all
employees in the unit. 
Consent Election: Similar to a certification election proceeding, consent election is the process of
determining through secret ballot the sole and exclusive bargaining agent of employees in an
appropriate collective bargaining unit for purposes of collective bargaining or negotiations. This
process, however, differs from a certification election as this is voluntarily agreed upon by the
parties, with or without the DOLE’s intervention. In such a case, the med-arbiter need not issue a
formal order calling for such an election. The minutes of the agreement and records of the case
are forwarded to the Regional Director for implementation of the consent election.

B. 
Marcel was the Vice President for Finance and Administration and a member of the Board of
Directors of Mercedes Corporation. He brought a complaint for illegal suspension and illegal
dismissal against Mercedes Corporation, which moved to dismiss the complaint on the ground
that the complaint pertained to the jurisdiction of the RTC due to the controversy being
intracorporate based on his positions in the corporation, Marcel countered that he had only been
removed as Vice President for Finance and Administration, not as a member of the Board of
Directors. He also argued that his position was not listed as among the corporate offices in
Mercedes Corporation’s by laws. Is the argument of Marcel correct? Explain your answer.
(2.5%)

SUGGESTED ANSWER 
Yes, Marcel’s argument is correct. The question is whether the complaint for illegal dismissal
filed by Marcel is intra-corporate and thus beyond the jurisdiction of the Labor Arbiter. Marcel
as the Vice-President for Finance and Administration is not a corporate official. Although he is a
member of the Board of Directors, he was not removed as such; he was removed only from his
position as Vice-President. Inasmuch as the core issue is his termination as a non-corporate
official, then Marcel’s complaint for illegal dismissal is not an intra-corporate controversy (Real
v. Sangu Philippines, Inc. et al., G.R. No. 168757, January 19, 2011, 640 SCRA 67). 
ALTERNATIVE ANSWER 
Yes, Marcel’s argument is correct. Only corporate officers such as the president, secretary,
treasurer, and such other officers as may be provided in the by-laws of the corporation are
subject to the jurisdiction of the RTC. Corporate officers are those whose position is a creation of
the corporate charter or by laws and whose election is by virtue of the acts of the Board of
Directors (Cosare v. Broadcom Asia, Inc., G.R. No. 201298, February 5, 2014,715 SCRA 534). 
C.

State the jurisdiction of the Voluntary Arbitrator, or Panel of Voluntary Arbitrators in labor
disputes? (4%) 
SUGGESTED ANSWER 
The jurisdiction of the Voluntary Arbitrator, or Panel of Voluntary Arbitrators in labor disputes
is provided in Article 274 (formerly Article 261) of the Labor Code, viz: the Voluntary
Arbitrator or panel of Voluntary Arbitrators shall have original and exclusive jurisdiction to hear
and decide all unresolved grievances arising from the interpretation or implementation of the
Collective Bargaining Agreement and those arising from the interpretation or enforcement of
company personnel policies referred to in the immediately preceding article. Accordingly,
violations of a Collective Bargaining Agreement, except those which are gross in character, shall
no longer be treated as unfair labor practice and shall be resolved as grievances under the
Collective Bargaining Agreement. For purposes of this article, gross violations of Collective
Bargaining Agreement shall mean flagrant and/or malicious. refusal to comply with the
economic provisions of such agreement. 
ALTERNATIVE ANSWER 
Under Articles 274 and 275 of the Labor Code, as re-numbered, the jurisdiction of Voluntary
Arbitrators or Panel of Voluntary Arbitrators are: 
(a) original and exclusive jurisdiction to hear and decide all unresolved grievances arising from
the interpretation or implementation of the Collective Bargaining Agreement (Article 274);
(b) those arising from the interpretation or enforcement of company personnel policies (Id.);
(c) upon agreement of the parties, jurisdiction to hear and decide all other labor disputes
including unfair labor practices and bargaining deadlocks (Article 275).

XII.

A. 
Juanito initiated a case for illégal dismissal against Mandarin Company. The Labor Arbiter
decided in his favor and ordered his immediate reinstatement with full backwages and without
loss of seniority and other benefits. Mandarin Company did not like to allow him back in its
premises to prevent him from influencing his co-workers to move against the interest of the
company; hence, it directed his payroll reinstatement and paid his full backwages and other
benefits even as it appealed to the NLRC.. 
A few months later, the NLRC reversed the ruling of the Labor Arbiter and declared that
Juanito’s dismissal was valid. The reversal ultimately became final. 
May Mandarin Company recover the backwages and other benefits paid to Juanito pursuant to
the decision of the Labor Arbiter in view of the reversal by the NLRC? Rule, with reasons.
(2.5%)

SUGGESTED ANSWER 
Mandarin cannot recover the backwages and other benefits paid to Juanito. The decision of the
Labor Arbiter insofar as the reinstatement aspect is concerned, is immediately executory pending
appeal (Felix v. Enertech Systems Industries Inc., G.R. No. 192007, March 28, 2001, 355 SCRA
680). In fact, in the case of Pioneer Texturizing Corp. v. NLRC (G.R. No. 118651, October 16,
1997, 280 SCRA 806), it was held that the order of the Labor Arbiter is self-executory; hence, it
is the obligation of Mandarin to immediately admit Juanito back to work or reinstate him in the
payroll. 
When Mandarin appealed the Labor Arbiter’s decision to the NLRC, the employer-employee
relationship between the former and Juanito never ceased; and his employment status remained
uncertain until the NLRC reversed the decision, which became final. 
Thus, the reinstatement salaries due to Juanito were, by their nature, payment of unworked
backwages. These were salaries due to him because he was prevented from working despite the
finding of the Labor Arbiter that he had been illegally dismissed (Wenphil Corp. v. Abing and
Tuason, G.R. No. 207983, April 7, 2014, 721 SCRA 126).

B.
Gene is a married regular employee of Matibay Corporation. ” employees and Matibay
Corporation had an existing CBA that provided for funeral or bereavement aid of P15,000.00 in
case of the death of a legal dependent of a regular employee. His widowed mother, who had been
living with him and his family for many years, died; hence, he claimed the funeral aid. Matibay
Corporation denied the claim on the basis that she had not been his legal dependent as the term
legal dependent was defined by the Social Security Law. 
(a) Who may be the legal dependents of Gene under the Social Security Law? (2.5%) 
(b) Is Gene entitled to the funeral aid for the death of his widowed mother? Explain your answer.
(2%)

SUGGESTED ANSWER 
(a) Pursuant to Section 8(e) of Rep. Act No. 1161, the legal dependents of Gene under the Social
Security Law are the legitimate, legitimated or legally adopted child who is unmarried, not
gainfully employed and not over twenty-one years of age, or over twenty-one years of age
provided that he is congenitally incapacitated and incapable of self-support, physically or
mentally; the legitimate spouse dependent for support upon the employee; and the legitimate
parents wholly dependent upon the covered employee for regular support. 
(b) Gene would be entitled to the funeral aid under the CBA for the death of his widowed mother
because the latter is a legitimate parent wholly dependent upon him for regular support for many
years. As held in a case, the coverage of the term “legal dependent” in a stipulation in a CBA
granting funeral or bereavement benefits to a regular employee for the death of a legal
dependent, if the CBA is silent about it, is to be construed as similar to the meaning that
contemporaneous social legislation have set. This is because the terms of such social legislation
are deemed incorporated in or adopted by the CBA (Philippines Journalists, Inc. v. Journal
Employees Union, et al., G.R. No. 192601, June 3, 2013, 697 SCRA 103).

C. 
Rosa was granted vacation leave by her employer to spend three weeks in Africa with her family.
Prior to her departure, the General Manag of the company requested her to visit the plant of a
client of the compan in Zimbabwe in order to derive best manufacturing practices useful to the
company. She accepted the request because the errand would be important to the company and
Zimbabwe was anyway in her itinerary. It appears that she contracted a serious disease during
the trip. Upon her return, she filed a claim for compensation, insisting that she had contracted the
disease while serving the interest of her employer. 
Under the Labor Code, the sickness or death of an employee, to be compensable, must have
resulted from an illness either definitely accepted as an occupational disease by the Employees’
Compensation Commission, or caused by employment subject to proof that the risk of
contracting the same is increased by working conditions. 
Is the serious disease Rosa contracted during her trip to Africa compensable? Explain your
answer. (2.5%)

SUGGESTED ANSWER 
For sickness and the resulting disability to be compensable, the sickness must be the result of an
occupational disease listed under Annex A of the Amended Rules on Employees’ Compensation
with the condition set therein satisfied; otherwise, proof must be shown that the risk of
contracting the disease is increased by the working condition. The burden of proof is upon Rosa.
No proof was presented by Rosa to substantiate the foregoing. Moreover, it is required that the
sickness and the resulting injury must have arisen out of or in the course of employment. In the
present case, Rosa contracted the disease while on vacation leave. Consequently, the disease
contracted by her in Africa during her vacation leave is not compensable (Iloilo Dock &
Engineering Co. v. Workmen Compensation Commission et al., G.R. No. L-26341, November
27, 1900, 26 SCRA 102).

ALTERNATIVE ANSWER 
Yes, although Rosa’s leave of absence was approved, she was merely on a partial vacation due to
the business assignment that her employer gave her to visit the plant of a client in Zimbabwe to
derive best manufacturing practices useful to the company; thus, she had to go and observe said
activity beneficial to her employer in the performance of her assigned task. As she contracted the
disease during her trip, the same must be construed as work-related.

XIII 
A.

Given that the liability for an illegal strike is individual, not collective, state when the
participating union officers and members may be terminated from employment because of the
illegal strike. Explain your answer. (4%) 
SUGGESTED ANSWER

When a strike is declared illegal because of non-compliance with statutory or contractual

requirements or because of the use of unlawful means, the consequence is loss of employment
status of the officers of the union who knowingly participated in the illegal strike. 
Ordinary union members will lose their employment status only if they participated in the
commission of illegal acts during the strike, thus, mere union membership does not result in
automatic loss of employment as a result of an illegal strike (Article 263-264 (now Articles 278-
279) of the Labor Code; Pepsi-Cola Labor Union v. NLRC, G.R. No. L-58341, June 29, 1982,
114 SCRA 930; Solidbank Corp. v. Solidbank Union, G.R. No. 159461, November 15, 2010,
634 SCRA 554).

B.

A sympathetic strike is stoppage of work to make common cause with other strikers in another
establishment or business. Is the sympathetic strike valid? Explain your answer. (1%) 

SUGGESTED ANSWER 
A sympathetic strike is not valid. It is illegal because the strikers have no direct grievance against
their own employer; that is, no labor dispute exists between the strikers and the employer. 
C.
Due to business recession, Ballistic Company retrenched a part of its workforce. Opposing the
retrenchment, some of the affected employees staged a strike. Eventually, the retrenchment was
found to be justified, and the strike was declared illegal; hence, the leaders of the strike,
including the retrenched employees, were declared to have lost their employment status. 
Are the striking retrenched employees still entitled to separation pay under Sec. 298 (283) of the
Labor Code despite the illegality of their strike? 
Explain your answer. (2%) 

SUGGESTED ANSWER 
No. The Supreme Court has ruled if the strike staged by the union is declared illegal, the union
officers and members are considered validly dismissed from employment for committing illegal
acts during the illegal strike. The striking retrenched union officials and members who were
found guilty of having staged an illegal strike, which constituted serious misconduct, will not be
entitled to separation pay (C. Alcantara & Sons, Inc. v. Court of Appeals, G.R. No. 155109,
March 14, 2012, 631 SCRA 486; citing Toyota Motors Phils. Corp. Workers Association v.
NLRC, G.R. No. 158786 & 158789, October 19, 2007, 537 SCRA 171). 

ALTERNATIVE ANSWER 
Yes. Article 298 (283) of the Labor Code requires an employer to give, without qualification,
separation pay in cases of retrenchment. The law does not make a distinction as to which among
the retrenched employees are entitled to receive separation pay; thus, the striking retrenched
employees are still entitled to separation pay despite the illegality of their strike.

XIV.

Pursuant to his power under Sec. 278(g) (263(g)) of the Labor Code, the Secretary of Labor
assumed jurisdiction over the 3-day old strike in Armor Steel Plates, Inc., one of the country’s
bigger manufacturers of steel plates, and ordered all the striking employees to return to work.
The striking employees ignored the order to return to work.

(a) What conditions may justify the Secretary of Labor to assume jurisdiction? (2.5%)

SUGGESTED ANSWER 
(a) The conditions that may justify the Secretary of Labor to assume jurisdiction are found in
Article 278(g) (formerly Article 263 (g)), viz: “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. xxx”
(b) What are the consequences of the assumption of jurisdiction by the Secretary of Labor, and
of the disobedience to me to work? Explain your answer. (2.5%)

SUGGESTED ANSWER 
(b) The assumption of jurisdiction by the Secretary of Labor automatically results in a return-to-
work of all striking workers (if one has already taken place) or enjoins the taking place of a
strike, whether or not a corresponding order had been issued by the Secretary of Labor (Union of
Filipro Employees v. Nestle Philippines, Inc., G.R. Nos. 88710-13, December 19, 1990, 192
SCRA 396).

When jurisdiction over a labor dispute is assumed by the Secretary of Labor, such
comprehensive jurisdiction includes all incidental issues and cases which otherwise would be
under the original and exclusive jurisdiction of the labor arbiters (International Pharmaceuticals,
Inc v. Secretary of Labor, G.R. Nos. 92981-83, January 9, 1992, 205 SCRA 59). 
A disobedience or defiance of the return-to-work order of the Secretary of Labor results in a loss
of employment status (Allied Banking Corporation v. NLRC, G.R. No. 116128, July 12, 1996,
258 SCRA 724).